Accidental Insurance on ATM Cards in India: Key Benefits, Claim Process, and Essential Statistics
In response to Lok Sabha Unstarred Question No. 2711 concerning the provisions for accidental insurance linked to ATM cards, Shri Pankaj Chaudhary, Minister of State in the Ministry of Finance, outlined the existing framework and pertinent statistics related to this initiative.
Key Highlights from the Response:
Accidental Insurance Provision:
The Reserve Bank of India (RBI) does not mandate insurance coverage for debit or credit cards. However, card issuers or payment networks have the option to provide insurance—either complimentary or chargeable—subject to the cardholder’s consent.
Under the Pradhan Mantri Jan Dhan Yojana (PMJDY), RuPay cardholders receive an accident insurance cover of ₹2 lakh, which was increased from ₹1 lakh for accounts opened after August 28, 2018. This benefit is available to cardholders who complete at least one successful financial or non-financial transaction within 90 days prior to the date of the accident.
RuPay Card Statistics in Madhya Pradesh:
As of February 26, 2025, there are a total of 3,34,97,859 RuPay cards issued under PMJDY in Madhya Pradesh, indicating significant adoption of this financial service among residents.
Claims Under the PMJDY Scheme:
For the fiscal year 2023-24, there were 24 claims reported for accidental death or disability by RuPay cardholders in Madhya Pradesh. Of these, 18 claims totaling ₹29 lakhs were successfully settled, demonstrating the effectiveness of the insurance provision.
Accident Statistics:
The Ministry of Road Transport and Highways has stated that comprehensive data regarding the total number of accident-related deaths in Madhya Pradesh for the year 2023-24 is currently unavailable, highlighting a gap in the collection of vital safety statistics.
Expediting Claim Settlements:
The government has called upon banks, the National Payments Corporation of India (NPCI), and other stakeholders to ensure prompt processing of claims under the RuPay card accidental insurance scheme.
Claimants are required to notify their bank within 90 days of the accident and submit all necessary documentation within 60 days of the claim notification. Claims should be settled within 10 working days following the receipt of complete documents, aimed at enhancing the efficiency of the claims process.
Conclusion
The accidental insurance provision associated with RuPay cards under the PMJDY is designed to enhance financial security for cardholders in the event of unforeseen accidents. While the current framework is established, ongoing efforts are focused on raising awareness and streamlining the claims process to ensure beneficiaries receive timely support. The substantial number of RuPay cards issued reflects the government’s commitment to promoting inclusive financial services. However, improved data collection on accident statistics would be beneficial for future policy development and safety initiatives.
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