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Explainer: What are the Compensation Terms for Victims of Railway Accidents?


The tragic triple-train accident in Balasore, Odisha on 02 June 2023 resulted in the death of nearly 300 passengers and several hundreds were reported injured. Apart from the compensation announced from various relief funds, the railways also has a compensation scheme. Here are the details.

The tragic triple-train accident in Balasore, Odisha on 02 June 2023 resulted in the death of nearly 300 passengers and several hundreds were reported injured. The central government and different state governments have announced financial assistance to the kin of deceased persons and to those who sustained injuries. However, apart from the compensation from relief funds announced by governments, Indian Railways is legally bound to compensate for the loss. There are also insurance covers that train passengers can avail of at the time of booking train tickets for a small amount. In this story, we look at the assistance provided by the railways at the time of unfortunate incidents. 

Railways Act, 1989 clearly establishes the liability of the Railway Administration at the time of accidents 

Section 124 of the Indian Railways Act, 1989 deals with the extent of liability of the Railway Administration for death, injury, or damage of goods belonging to passengers due to accidents. According to the Act, if a railway accident occurs involving at least one train carrying passengers including a railway servant on duty, the railway administration is legally bound to pay a prescribed compensation for loss of lives, injuries, and damage to goods belonging to passengers in the accident. The accident may be due to collision, derailment, fire, or explosion, or due to road vehicles colliding with trains at level crossings, etc. 

However, no compensation would be provided if the passenger dies or gets injured in the following cases-

  1. Suicide or attempted suicide
  2. Self-inflicted injury
  3. Own criminal act
  4. Act due to insanity or intoxication
  5. Due to medical conditions or disease or natural cause or surgical treatment not arising due to the train accident/untoward incident

Since 1994, the Act has also made the railway administration liable to pay compensation for loss of life or injury to bonafide rail passengers, who become victims of untoward incidents such as terrorist acts, violent attacks, robberies, dacoity, rioting, shoot-out or arson by any persons in or on any train carrying passengers, waiting hall, cloakroom, reservation or booking office, platform, any place within the precincts of a railway station or the accidental falling of any passenger from a train carrying passengers.

Quantum of compensation ranges from Rs. 64,000 to Rs. 8 Lakhs

The quantum of compensation to be paid is determined by the Railway Accidents and Untoward Incidents (Compensation) Amendment Rules, 1990. Under these Rules last revised in 2017, the amount of compensation payable in case of death is Rs. 8 lakhs. For injuries, the amount depends on the nature of the injury sustained and ranges from Rs.64,000 for fractures of arms and legs to Rs. 8 lakhs for loss of body parts or amputation. Prior to the revision, the amount was half of the present amount, between Rs.32,000 to Rs. 4 lakhs.

The railway administration also provides ex-gratia relief soon after an accident to meet the immediate expenses arising out of the situation. It is not taken into account during the time of final settlement of compensation claims. The amount varies from Rs. 500 for simple injury to Rs.15,000 for grievous injury, and Rs. 50,000 for death during train accidents. The amount varies for untoward incidents and accidents at manned level crossings due to Railway’s prima facie liability. 

Applications for compensation are to be made with the Railways Claims Tribunal

Section 125 of the Act lays out the procedure to claim compensation under the Act. The application is to be made to the Railways Claims Tribunal by the person who has sustained the injury or suffered any loss, or any agent duly authorized by such person on this behalf, or by dependent in case of death of a passenger in the accident/incident or guardian, in case of a minor. The Tribunal will decide the application. There are around 20 benches of the Tribunal that are spread across the country. The principal Bench is in New Delhi. The Tribunal was set up in 1989 to provide speedy justice to rail users and passengers.

Since 2016, an optional insurance scheme has been rolled out for railway passengers

Apart from this, an Optional Travel Insurance Scheme was launched in 2016 for the Confirmed/RAC Railway passengers who book e-tickets through the official website of the Indian Railway Catering & Tourism Corporation (IRCTC) portal at the premium of Rs. 0.92 per passenger. The premium amount was further reduced to Rs. 0.35 per passenger in 2021. At the time of booking the ticket, the option to avail of the policy is displayed. For those who avail the same, after booking the ticket, the nomination details are to be filled out at the respective Insurance Company site that has been sent through SMS/Email. If nomination details are not filled in, then the settlement shall be made with legal heirs if the claim arises.

Only Indian citizens are covered under the insurance policy

The policy is only for Indian Citizens and children up to 5 years of age are not covered under the scheme if they are not booked with a seat/berth. Two Insurance Companies- Liberty General Insurance Ltd. and SBI General Insurance Co. Ltd are responsible for policy issuance and claims settlement.

The definition of accident and untowardly incidents for the insurance is as given in the Railways Act discussed earlier. The policy coverage is for each passenger under the PNR in case of death, permanent total disability, permanent partial disability, and hospitalization expenses for injury and transportation of mortal remains following a rail accident or untoward incident. 

As per the guidelines, if a passenger dies in a train accident or suffers a permanent total disability, then an insurance amount of up to Rs. 10 lakhs is paid (100% of the sum insured). If the passenger suffers a permanent partial disability, then the compensation provided to them is Rs 7.5 lakh. In case of an injury arising out of the accident, hospitalization expenses of Rs. 2 lakhs are paid and in case of transportation of mortal remains, an amount of Rs.10,000 is paid. Depending on the permanent partial disability, the compensation ranges from 10% to 100% of the insured amount.

PMO & State Governments have announced ex-gratia relief for victims in the Odisha train tragedy

Apart from the above-discussed compensation schemes, states and the Central Governments may extend financial support to the victims with their funds. For instance, in the case of the Balasore Train incident, various governments have also announced financial support. The railway minister announced an ex-gratia compensation to the victims of Rs. 10 Lakh in case of death, Rs. 2 Lakh towards grievous injuries and Rs. 50,000 for minor injuries. The Prime Minister announced that an ex-gratia from the Prime Minister’s National Relief Fund (PMNRF) of Rs. 2 lakhs would be given to the next of kin of each deceased in the train mishap and the injured would be given Rs. 50,000. In addition to the PMO and Railways Ministry’s announcements, the Odisha Chief Minister announced ex-gratia of Rs. 5 lakhs for the kin of the deceased and ex-gratia of Rs. 1 lakh for seriously injured persons. The Chief Minister of Tamil Nadu and the Chief Minister of Andhra Pradesh have also announced ex-gratia for the victims. 

Featured Image: Compensation Terms for Victims of Railway Accidents


About Author

A bachelor’s degree in mathematics and master’s in social science, she is driven by ardent desire to work with this unique combination to create her own path instead of following the herd. Having served a stint as the college union chairperson, she is a strategist who is also passionate about nature conservation, art and loves solving Sudoku.

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