The free personal accident insurance cover of Rs 1 Lakh will be an add-on service given to existing as well as new savings account holders of SBH.
Speaking on the occasion, Renu Challu, Managing Director of State Bank of Hyderabad said that the bank had 8 million savings accounts, of which around 2 million were either not operational or no-frills accounts.
SBH will pay a premium of Rs 10 for every account to United India Insurance. This premium will entitle the customer for a 1 year personal accident cover of Rs 1,00,000. The policy will start from July 1, 2011 and will be valid till June 30, 2012.
G Srinivasan, Chairman and Managing Director of United India Insurance was present in Hyderabad to sign the agreement with SBH. He told reporters that bancassurance is a good model to increase insurance penetration as it helps overcome the bottleneck of reaching potential customers.
This is the third product from the bancassurance tie-up between SBH and United India Insurance. The four public sector insurers – United India Insurance, National Insurance, New India Assurance and Oriental Insurance are soon going to launch their own captive TPA.