Yes Bank offers COVID-19 health cover for fixed deposits over Rs 1 lakh

Looking to shore up its deposit base, private sector lender Yes Bank on Friday launched a fixed deposit product with a health cover for COVID-19 illness.

The bank has tied up with Reliance General Insurance for the product, under which it will bear the premium cost for a cover of Rs 25,000 for new fixed deposits of over Rs 1 lakh, an official statement said.

Yes Bank, which had to be bailed out by a consortium of lenders led by SBI in March, had seen erosion of deposits in the weeks leading to it being put under a moratorium by the Reserve Bank.

It closed FY20 with a 53 per cent reduction in its deposit base.

Under the new scheme, new fixed deposit openings of Rs 1 lakh for one year and above will get the complimentary health insurance cover apart from an interest of around 7.25 per cent, it said.

"The insurance cover provides lump-sum benefit of Rs 25,000 to beneficiaries on being tested positive for COVID-19," the bank said, adding that it is different from traditional policies as the amount will be offered without any hospitalisation.

People aged between three months to 60 years can avail the fixed deposit, and the scheme is valid only up to June 30, it said.

Earlier, the bank had launched COVID-19 Protection Insurance Cover, a voluntary benefit policy being offered as a group cover to its customers.