New Railway Insurance May Not Help Many Victims of Kanpur Tragedy

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New Railway Insurance May Not Help Many Victims of Kanpur Tragedy insurance

New Delhi: About 78 passengers onboard the Indore-Patna Express, which derailed on Sunday were identified to be beneficiaries under a new IRCTC optional insurance cover. But if insurance service providers are to be believed then disbursal of payments could take ‘infinite time’.

So far, 145 people have been killed in the accident which has left 200 more injured.

Indian Railway Catering and Tourism Corporation (IRCTC) introduced the travel insurance scheme on September 1, 2016, which makes the Indore-Patna Express tragedy the first accident that will put the scheme to test. Commuters can avail insurance after paying a premium of 92 paise to the railways while booking the ticket. IRCTC has partnered with ICICI Lombard General Insurance, Royal Sundaram General Insurance Co. Ltd and Shriram General Insurance Co. Ltd for the scheme.

Jaganathan Annamalai, Head of Commercial Lines, Shriram General insurance Co Ltd, told News18 that most of the beneficiaries would face a lot of difficulty to claim their insurance amount. “Passengers don’t take a train journeys security seriously. After a passenger books their ticket, we send emails and reminders but in spite of this, they do not appoint a nominee whom we can disburse the amount in case of a death,” Annamalai said.

He also said that when the insurance company does not have a nominee’s name, they usually have to wait for a legal heir certificate to be issued by the local government.

“It is just 92 paise and hence no one bothers to appoint a nominee. Without a legal heir name, we cannot proceed with settling the claims. This travel insurance scheme should be made mandatory and not optional, and then people should be compelled to follow these regulations to avoid future hassle,” he said.

According to the Chief Public Relations Officer (CPRO) of Indian Railways, Anil Saxena, the derailed Indore-Patna Express had on board 695 passengers who were travelling on reserved seats. Out of them, 128 had opted for the insurance and paid for it at the time of booking. “Out of the 128 passengers, 78 were in the train during the accident, whereas the remaining was to board later. Even if the insurance claim takes time to settle, the bereaved families have been provided an ex-gratia of Rs 3. 5 lakh already which is in addition to the insurance amount payable (sic),” he said.

However, the chief of IRCTC told News18 that companies would not be allowed to “get away with the nominee excuse.” A K Manocha, Chairman and Managing Director of IRCTC said that there were several issues which might lead to “very few claims out of the official figure of 78”.

“The data we have received from Shriram General Insurance Co and Royal Sundaram General Insurance Co., shows that many people had given wrong numbers while booking tickets either themselves or through an agent, and this makes tracing them very difficult. Almost 51 out of 128 insured had their tickets automatically cancelled due to wait-list or detained due to non-confirmation of the tickets,” Manocha said.

He said that insurance companies will not leave the cases if nominees cannot be located and the state would also intervene to get the affected their insurance amount. “But there should be requests from the family of the deceased or injured as well. My estimate is not more 10 to 15 claims will be there out of the total 78 because many were called up and they said that they were safe or were not in the affected bogies,” Manocha said.

Sanjay Dutta, Chief of Underwriting and Claims, ICICI Lombard General Insurance Company Limited, told News18 that ‘more than sorting nominees, the problem is to identify the passengers actually travelling in the train’. “As of now we have not received any claims, but at this juncture we are trying to find who were actually travelling in the affected bogies while the accident took place and finding the nominee will only take place after that,” he said.

Masood Wahab, Chief Manage, Oriental Insurance Company, maintained that disbursal of payments could be ‘painstakingly long’ if correct nominees are not stated. He told News18 that identification of the correct nominee was very important and it may cause inordinate delay.

“When a beneficiary does not appoint a nominee then their natural nominee has to come forward and prove by certificates to the effect of law that they are entitled, and only then disbursals can be made,” he said.

However, Wahab said that it is strange that companies like ICICI Lombard and others did not have a strong procedure to have the names of the nominees in place before giving insurance. “Premium is not important, expediting the claims is what one looks for in these cases,” said Wahab.

Manocha told News18 that IRCTC has written to the Railway Ministry to make this insurance scheme mandatory with other features such as making it applicable to unreserved tickets, linking the insurance to Aadhar numbers, insuring valuables of commuters and paying a lump sum amount to insure all their local and short distance train journeys throughout the year.

The claims under the new scheme is Rs 10 lakh in case of death, Rs 10 lakh in case of Permanent Total Disability, Rs 7.5 lakh in case of permanent partial disability, Rs 2 lakh for hospitalization expenses for injury and Rs 10,000 for transportation of mortal remains.