SBI Cardholders Beware: Free Air Insurance Ends Soon!

2025-06-30

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Ranveer Singh

SBI Cardholders Beware: Free Air Insurance Ends Soon!

Free Air Accident Insurance to Be Cancelled
What Was Covered Before?
What’s Changing Now?
Adjustment in Minimum Amount Due (MAD) Calculation
What’s the Change?
Caution:
What Should SBI Cardholders Do Now?
Why Is SBI Doing This?
Final Takeaway

Attention SBI Card users! A major change is coming that may affect your travel safety net and your monthly payments. FREE Air Accident Insurance cover with effect from July 1, 2025:This is one benefit which has been liked by many cardholders and from July 1, 2025, there will be no more FREE protection.Let’s unpack what that means for you.

Free Air Accident Insurance to Be Cancelled

For many years, SBI cardholders had the benefit of free Air Accident cover to provide financial support to their family in the event of an unfortunate air mishap. But, now SBI Card has formally announced the discontinuation of this benefit across all card variants from July 2025 onwards.

What Was Covered Before?

As is common, this insurance offered lump sum benefit (which is usually anywhere between ₹10 lakh – ₹50 lakh) to the nominee in case the policyholder died in an accident during an air travel on tickets booked using an SBI credit card.

What’s Changing Now?

Effective Date: July 1, 2025
Impact : You do not receive any free air accident insurance on SBI Credit Cards, be it any variant (Platinum, Signature, Elite etc)
Current Coverage: Will remain in effect for eligible cardmembers through June 30, 2025.

Adjustment in Minimum Amount Due (MAD) Calculation

With removal of the insurance benefit the company will also change the way it computes your Minimum Amount Due (MAD) on credit card bills.

What’s the Change?

From July 2025:

GST and other fees now exempt in MAD calculation
Going forward the MAD will only be computed on the principal plus interest/fees so the minimum payment is reduced a small amount each month as the remaining principal balance declines.

Caution:

But simply paying off the MAD alone subjects you to a high APR (30-40% p.a. typical APR) on the balance that remains.

What Should SBI Cardholders Do Now?

If You Travel Frequently: You may want to purchase a further private air travel insurance if you do travel with your own plane so that you are still covered.
Review Your Current Benefits: All you have to do is login to your SBI Card account and view your eligible card benefits list.
Plan Your Payments: Don’t just keep paying the MAD every month. You need to pay off those full balances to avoid steep interest charges.
Stay Alert for Further Changes: After such announcements, banks have frequently changed rewards programs, late fees and the fees for cash advances.

Why Is SBI Doing This?

Industry experts suggest:
Rising insurance costs
Airline insurance policies have a low number of customer claims.
A wider push by Indian banks to scale back low-use free perks
Drive to be in the black at a time of growing expense
SBI Card is also simplifying how it collects repayments by aligning its calculation with international credit card billing norms.

Final Takeaway

For those who own an SBI credit card, July 2025 has signalled a sea change in terms of your card’s benefits.Farewell, free air accident insuranceMiniscule new Minimum Amount Due, but same risk of never-ending debt if unpaidStay informed. Stay prepared. And as always, read your card’s terms and conditions carefully.