Ever wondered about the value of one rupee while tossing a coin to a beggar at a traffic light or a holy place? Well… its worth could be as high as Rs10 lakh for your family!
Next time, while you are booking tickets from a railway counter, do not ignore that box asking you to opt for the 92 paisa insurance. The Indian Railway Catering and Tourism Corporation (IRCTC) insures a passenger’s life for Rs10 lakh, which the family is entitled to receive in case of an unforeseen accident resulting in a passenger’s death.
On July 20, this year the Supreme Court passed a directive making third-party insurances mandatory for new vehicles, both cars and two-wheelers, to be sold from September 1. For two-wheelers, the insurance period would be five years and for cars, it would be three years.
Rakesh Jain, Executive Director and CEO, Reliance General Insurance, says “Over 50 per cent of total vehicles in India are without insurance, the Supreme Court order is a welcome move. It’s mandatory to have an insurance cover when vehicles are brought for the first time, but in many cases they are not renewed in subsequent years. The order of mandatory third-party insurance cover as well as for a longer tenure will help to protect owners from the unforeseen liability.”
The moto behind the judgement is to ensure that road accident victims receive due compensation and insurers are sympathetic rather than looking at those from a commercial perspective.
While booking a cab make sure to tap on the insurance button on your mobile screen, when it prompts to take a cover for Rupee One, Rs10 or Rs15, according to the ride you opt for. Kaushiki Mukherjee (19), a student at Amity University regularly takes a cab to college from her Ghaziabad home.
She says, “I had no idea that an insurance is available to riders and its actually a great initiative. There are times when our classes end late in the evening and we fear for our safety with increasing number of road rage cases and accidents.”
Like Mukherjee, most travellers availing various modes of public transport everyday—cabs, buses, trains and airlines are either unaware of travel insurance or end up completely ignoring them.
According to Ministry of Statistics and Programme Implementation, between 2012 and 17, 456 passengers were killed and 1,138 were injured in road accidents. Ministry of Road Transport and Highways data shows, 1,50,785 people were killed and 4,94,624 were injured in 4,80,652 road crashes in India in 2016. This translates into 1,317 crashes and 413 deaths every day or 55 crashes and 17 deaths every hour. The number of road accident deaths has increased by 31 per cent from 2007 to 2017. Also the number of fatal accidents have increased by 25.6 per cent in the same period.
Gaurav Paliwal, 31, a government employee residing in Noida, loves to travel and often avails the inter-state bus service for such small pleasures. But he says, “Most of the inter-state buses and private cabs do not provide any passenger insurance. I think passenger insurance should be provided, as accidents are very common in India. If the inter-state buses and cabs offer passenger insurance, I will definitely take it.”
As per, General Insurance Council of India’s latest report, approximately 60 per cent of automobiles in India are uninsured and most of these are two-wheelers.
Citing the importance of safety of students travelling from home to school and vice versa, KV Dipu, Head—Operations and Customer Service of Bajaj Allianz General Insurance, says, “Our company provides Group Personal Accident Cover. The school needs to select a combination of two plans i.e. Out Patient Department (OPD) and Accidental Hospitalization”.
“The sum insured for OPD ranges between Rs5,000 and Rs15,000, and Accidental Hospitalization covers around Rs10,000 – 2 lakh. The premium for these two covers put together is only Rs6 per month or Rs70 annually,” Dipu explains.
The committee appointed by the Apex Court also pointed out that out of the 18 crore vehicles plying on Indian roads, only one third, or about six crore vehicles, have third party insurances. This often result in road accident victims not receiving any compensation.
Outlook Money also spoke with some of private cab and e-rickshaw drivers about insurance. Surprisingly, many of them, including Uber and Ola drivers, were not aware that they are also covered under insurance.
According to experts, most of the private commercial passenger service (cabs and buses) do not have cover under motor insurance. Fewer private commercial passenger services have motor and driver’s insurance. This is simply due to the lack of awareness though. It is mandatory to have a valid insurance according to the Motor Vehicles Act, 1988 while one is driving.
Director of Health, Life and Strategic Initiatives, Coverfox.com, Mahavir Chopra says two-wheeler insurance is the largest in terms of volume, owing to the increased number of two-wheelers on Indian roads. This is followed by comprehensive car insurance, third party car insurance followed by general travel insurance.
“Many customers leave change with the driver when they pay in cash. The cost of travel insurance is often less than that change,” says Varun Dua, Founder and CEO, Acko General Insurance. He adds that this clearly points out the importance of Ola ride insurance.
Cab aggregator Ola has launched ‘chalo befikar’, an in-trip cover campaign for passenger travel coverage in association with Bajaj Allianz General Insurance, Acko General Insurance and ICICI Lombard General Insurance.
An Ola spokesperson says, “Ola enables smart transportation options to over 12.5 crore users through its network of over 10 lakh driver partners. With over 20 lakh people taking Ola every day, it serves as many as 100 crore rides annually and operates in more than 110 Indian cities with nine lakh vehicles, across 14 diverse categories”.
Travelling by train is extremely popular and cost-effective means of transport in India. Needless to say most Indians choose to travel by train often. According to a data shared by Ministry of Statistics and Programme Implementation, nearly 811.6 crore passengers travelled by train in 2016–17.
To promote digital transaction, an insurance cover as low as 92 paisa is provided for free, since December 10, 2016, to all confirmed passengers booking tickets online from IRCTC, confirms Rajen Gohain, Minister of State for Railways, told Lok Sabha in a written response.
While booking railway tickets from a counter, travel insurance is still optional. However, if one opts for it, then every passenger whose ticket are being booked will be automatically entitled to the insurance under a single PNR number. IRCTC has partnered with Shriram General Insurance, Royal Sundaram General Insurance and ICICI Lombard General Insurance to provide travel insurance for passengers. However, children under five years and foreigners are not eligible for this policy. It is valid in cases like train accident, riots, terrorist attacks, shoot-out or arson in train, on platform or enroute to its destination.
When we travel abroad, for holiday or business, we often opt for travel insurance. However, not all of us make an effort to know what all does the insurance package covers. Not doing so can have far-reaching consequences and might result in a well-planned trip being completely spoilt. Such an experience would be nothing but reminder of carelessness.
Kolkata-based couple Sarathi Nag and Ankur Ghoshdastidar has a similar story to narrate. The couple chose Bali as their honeymoon destination and opted for partial travel insurance. “When we reached Bali airport, our baggage was stuck at Kuala Lampur airport. We took a travel insurance but didn’t opt for the full package. Loss or delay of check-in baggage was not covered, hence we received our baggage only the next day,” rues Ghoshdastidar.
To avoid such unpleasant incidents, always choose the right travel insurance plan while scheduling your vacations.
Industry experts opine that insurance plans are not all about covering death, injury and medical emergencies. The benefits of travel insurance include trip delay or cancellation, loss or delay of check-in baggage, loss of passport, emergency cash benefit and others.
Good decisions come from experience and experience comes from some bad decisions. No doubt safety comes first while you travel but an insurance, which does not cost more than a few rupees, is critical not only for your belongings, but also for your life. Therefore, be smart and travel with insurance.
nirmala@outlookindia.com