After passenger cover, railways plans baggage insurance

After successfully rolling out insurance for passengers who book tickets online, the Indian Railways is planning to introduce theft insurance. Under the proposed scheme, travellers can get a cover for all their baggage, electronic items and other valuables.

The scheme would cover incidents like robbery and dacoity. Indian Railway Catering and Tourism Corporation (IRCTC) has sought insurance companies' views on the issue.

The existing system doesn't provide any provision for compensation in case of theft during a rail journey. According to the rules, a passenger can approach the train conductor, coach attendants, guards or escorts, in case of a robbery or dacoity. In such cases, railways officials normally help passengers file a first information report (FIR) with the police station concerned. However, the stolen goods are rarely recovered. And to claim normal theft insurance, passengers need a "non-traceable certificate" from police, which takes at least three months.

"IRCTC has asked us to look into theft insurance possibilities and submit our views. Their idea is to provide cover for all items, including laptops, mobile phones and other valuables," said a top executive of a Mumbai-based insurer.

The initiative comes on the back of the passenger insurance scheme introduced by the railways on September 1, which became an instant hit among online ticket buyers. Till now, the scheme has attracted over 6 million buyers with about 330,000 passengers choosing it everyday.

Once IRCTC gets insurers' views on theft cover, it will take up the matter with the railway ministry for clearance. IRCTC Chairman and Managing Director A K Manocha said railways is also considering providing insurance cover to passengers who buy tickets offline or travel without reservation. "We will have to invite fresh tender if the scheme gets extended to unreserved passengers as well," he told Business Standard. The current cover is for all rail mishaps, including terrorist attacks and accidental falls from trains.

On an average, the IRCTC website records 3.2 million logins and up to 700,000 ticket bookings. The three companies providing passenger insurance are Shriram General Insurance, ICICI Lombard and Royal Sundaram General Insurance.

"The response we are getting is huge. In the first three days, the response was about 80 per cent and now it is in the range of about 50 per cent… Now, it seems railways are contemplating a wider cover," said Dipankar Acharya, country head, affinity and strategic relationships, Royal Sundaram. As per the current scheme, in the case of death or permanent disability of the traveller, Rs 10 lakh is provided. For permanent partial disability, the coverage extends to Rs 7.5 lakh; for hospital expenses, the coverage is up to Rs 2 lakh. In addition, the insurers provide Rs 10,000 for transportation of mortal remains.