KARACHI, Sept 27: The public sector National Insurance Company (NICL) has offered an insurance package to the Pakistan Railways that proposes compensation cover of the loss of lives, injuries and disability of the passengers and employees in accidents and that of the merchandise cargo being transported in trains.

“We are engaged in negotiations with the Pakistan Railways and hope to reach some agreement on premium and other details of the insurance cover,” a well-placed source in the NICL told Dawn on Wednesday.

Pakistan Railways carries about 70 million passengers in a year and operate about 230 train services. On a rough average the daily mail, express and passenger service carry about 200,000 passengers. The passengers train service generates more than Rs5 billion revenues in a year.

The Freight Business Unit with 12,000 personnel operates over 200 freight stations on the railway network. This unit serves two major ports of the country Karachi Port and Port Qasim.

It also generates revenue from the movement in four provinces of agricultural, industrial and imported products that are petroleum products, lubricants, wheat, coal, fertiliser, rock phosphate, cement, container traffic and sugar.

Officials say 39 per cent cargo traffic revenue is generated from transportation of petroleum products, 19 per cent from imported wheat, fertiliser, rock phosphate and the remaining 42 per cent from domestic traffic.

Under the NICL scheme there is a compensation of Rs200,000 on death of a passenger with valid ticket, Rs100,00 in case of permanent disability and Rs50,000 for injury. This compensation is subject to maximum payment of Rs100 million in one accident. The annual policy aggregate has been kept limited to Rs500 million in all.

The policy will only cover railway passengers holding a valid ticket including season ticket holders, passengers travelling on circular railway and children below age of five years, railway passes, platform ticket holders and railway men on duty, travelling on any train anywhere in Pakistan.

“The NICL proposes a premium of Rs2 on every passenger ticket while the Pakistan Railways insists on keeping premium up to Rs0.25 to Rs0.30 per ticket,” the official disclosed.

The NICL proposes Rs2 per passenger that will be applied to estimated number of passengers for the period, adjustable at the end of policy period on actual passenger carried.

A premium rate of Rs0.05 to Rs0.10 of the sum insured have been proposed for a large variety of cargo that include from sand stones to coal, cement, fertiliser, gypsum, firewood, oil cake, rice, salt, petroleum products, sugar etc.

The NICL has proposed insurance coverage for rolling stock and assets of Pakistan Railways. It has offered Rs1.5 billion coverage for collision and derailment.

With a primitive management structure, total lack of accountability of the minister-in-charge and those of the officials, outdated and almost obsolete stocks and equipment, the experts

believe that Pakistan Railways has the highest incidence of accidents — big and small — and insurance is a big risk.Even after major accidents and disasters and losses in terms of human lives and stocks none of the railways minister or any senior official has ever resigned. Inquiries were carried out but were never made public.

As many as 233 persons were killed and 509 injured in 486 train accidents during January 2002 to July 2005. This information was given to a Senate Sub-Committee in September last year by the railways minister.

Pakistan Railways losses in these accidents were given at Rs86.31 million. A sum of Rs29.72 million was paid as compensation to those killed and injured. According to the railways minister 144 accidents were happened due to “negligent driving on part of the road users” at various manned and unmanned level crossings. He attributed 134 accidents to defects in railway tracks.

The chairman the sub-committee in February this year informed the Senate about 382 train accidents during January 2003 to December 2005. These included 156 accidents of goods trains, 137 collisions of manned and unmanned level crossings and 89 of passengers.In June 2005, Pakistan Railways sought expression of interest from insurance companies for accident risk cover and received a few responses. But things could not move ahead.