Indian Railways has introduced a groundbreaking scheme that provides ₹1 crore in compensation to the families of employees in the case of accidental death, without any premium payment. This initiative aims to offer financial security to railway personnel and their loved ones, recognizing the risks associated with their jobs.
Why in News?
The scheme gained prominence following the disbursement of the first payout to the family of Sushil Lal, a loco pilot from the Moradabad division who tragically passed away in an on-duty accident. His wife, Priya Singh, received a ₹1 crore cheque from Northern Railway officials in Delhi on June 21, 2025.
How Does the Scheme Work?
- Employees do not need to pay any premium.
- They are required to have their salary account designated as a “Salary Package Account.”
- Partnered banks of Indian Railways administer the compensation in the event of accidental death.
- The scheme covers accidents that occur on duty, off duty, or outside the workplace.
Bank Partnership & Account Requirement
- Indian Railways has collaborations with major banks such as SBI.
- Employees must convert their salary accounts into Salary Package Accounts with partner banks.
- In the event of accidental death, the partner bank handles the claim and disburses ₹1 crore to the nominee.
First Beneficiary: Case of Sushil Lal
- Sushil Lal met with a fatal accident while deboarding a train after duty in March 2025.
- His wife and two children, aged 8 and 5, received the compensation.
- SBI efficiently processed the insurance claim and extended support to the bereaved family.
Awareness & Implementation
Indian Railways intends to raise awareness through:
- Displaying posters at railway stations and offices.
- Collaborating with major railway unions like All India Railway Men’s Federation (AIRF) and National Federation of Indian Railwaymen (NFIR).
- The objective is to maximize employee coverage under the scheme.
Significance and Benefits
- Provides financial security to families of employees in high-risk occupations.
- No deductions from employees’ salaries as insurance premiums.
- Boosts employee morale and demonstrates organizational support for its workforce.
- Strengthens welfare initiatives within Indian Railways.
Key Takeaways for Competitive Exams
- Indian Railways offers a ₹1 crore compensation scheme for employees in case of accidental death.
- No premium payment is required, and the scheme covers accidents on and off duty.
- Employees need to maintain a Salary Package Account with partnered banks for eligibility.
- The scheme aims to enhance the financial security of railway personnel and their families.
