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The covid-19-led lockdown has severely impacted the food delivery business in India, as several restaurants remained shut over the past few months, and home delivery orders took considerable impact (Photo: Mint)
The covid-19-led lockdown has severely impacted the food delivery business in India, as several restaurants remained shut over the past few months, and home delivery orders took considerable impact (Photo: Mint)

E-commerce firms begin offering covid-19 insurance for delivery workforce

  • E-commerce firms face greater risks of revenue loss as they depend on delivery executives who are more likely to contract the respiratory disease given the nature of their operations

MUMBAI: With coronavirus case count soaring across the country, e-commerce companies such as Flipkart, Zomato, Swiggy, BigBasket, and Amazon have started offering insurance cover and income protection plans for their delivery partners, local vendors, and supply chain associates.

Most have purchased medical insurance covers ranging from 50,000 to 5 lakh for their delivery workforce, both on-the-rolls and freelance staff.

"Companies, mostly in the e-commerce sector, who have frontline workers and delivery boys, are now buying insurance plans with sum assured of up to Rs. 5 lakh per person to cover against covid-19 risks. The premium for such products is around 2,500," said Sanjay Datta, chief of claims, underwriting and reinsurance at ICICI Lombard General Insurance Co. Ltd.

Premium for all-inclusive health insurance products that cover other health risks is 3,000-4,000 depending on the tenure which varies from 3.5 months to 6.5 months or 9.5 months. The size of the employees' medical insurance business (taken by companies) have been Rs. 7,000-8,000 crore, which is now poised to grow at 30-40%, Datta added.

India is now the third worst pandemic-affected country in the world, with total reported cases at 1.04 million so far. Most major cities and metros have seen a surge in cases over the past few weeks.

Compared to others, e-commerce firms, especially those engaged in food and goods delivery business, face greater risks of revenue loss as they depend on delivery executives who are more likely to contract the respiratory disease given the nature of their operations.

Walmart-owned e-commerce firm Flipkart has bought fresh insurance policies for all its 1.2 lakh supply chain employees and delivery partners.

Amitesh Jha, senior vice-president, Flipkart, said, “Our employees and partners are covered under a medical and accident cover of up to 3 lakh and 5 lakh respectively. This apart, Flipkart offers a term-life cover of 3 lakh for contract employees and a minimum term cover of 25 lakhs for full time employees. Our employees are also covered under Employee State Insurance Corporation (ESIC)."

"We are providing a COVID lumpsum cover of up to 50,000 to our employees who test positive for the virus," Jha added.

Flipkart has a 40% market share of India's e-commerce industry.

Flipkart’s alternate delivery model-partners such as kirana and freelance delivery executives are also insured against any loss of income due to the disease.

A spokesperson of rival Amazon India said associates working for the company directly or through staffing agencies are covered for medical insurance under the ESIC and if anyone tests positive or is placed under quarantine, a two-week paid leave is given.

The e-commerce giant has also launched a $25-million Amazon Relief Fund which can be utilised by individuals who are part of Amazon’s Delivery Service Partner Program, said the spokesperson.

Popular online food delivery companies Zomato and Swiggy have also been offering delivery executives and employees covid-19 insurance.

A Zomato spokesperson said, "We have 4,000 employees and about 2 lakh delivery partners. All our on-roll employees are covered for COVID-19 under the plan which is designed in partnership with ICICI Lombard General Insurance Co. Ltd. Through our Delivery Partner Insurance Plan in partnership with Acko General Insurance Ltd, we provide accidental and medical insurance to our delivery partners. Additionally, we also cover lost earnings in case they are infected by COVID-19."

A Swiggy spokesperson said the company has launched comprehensive insurance plans that cover hospitilisation expenses for both employees and their family members on testing positive.

“Swiggy is providing options to employees to personalise their medical policy as per their health profile. This includes additional top-ups up to 10 lakhs (self and dependants), hospitilisation cash cover, consumables cover and EMI protection plan at additional costs," said Swiggy.

Its active delivery partners and their family members are covered under medical insurance along with an income protection plan which provides them assured income for up to 14 days if they are hospitalised with the disease.

Online grocery supermarket BigBasket too has bought covid-19 insurance policies for all its frontline workforce and employees.

This insurance cover has been taken for a year, said Tanuja Tewari, vice president-human resources, Bigbasket, adding that the company will decide on extending insurance after assessing how the situation evolves over a year.

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