In a major bonanza, Bharat Sanchar Nigam Ltd is planning to offer its 36 million customers an accident insurance scheme free of cost.

Customers will be insured for up to Rs 50,000 against death and permanent total disability.

The programme will cover the period between August 1, 2007 and July 31, 2008.

BSNL, the country's largest telecommunication service provider, is planning the offer as it has seen its fixed-line subscriber base erode by 2 million since 2004.

Six leading insurance companies, including public sector majors, have provided their quotes for the scheme. The company board will take a final decision shortly.

Given the huge customer base, BSNL will not have to shell out much as premium. "Because of the size of our customer base, especially landline users, and the coverage amount, it should not cost us more than Rs 15 crore," he said.

The official declined to identify the insurance companies that had put in bids. "We will hire the lowest bidders. We may tie up with more than one company," he added.

The insurance cover will be given to all subscribers from the date of the launch, and new customers shall be eligible to join from the date they subscribe to a BSNL connection.

The cover, however, will terminate on July 31, 2008.

BSNL plans to ensure settlement of claims within seven days of the filing of the claim.

The insurance company will create a centralised claims team to process and monitor the claims of BSNL customers.

The insurance coverage is expected to cover over 33.7 million fixed-line subscribers and 3.4 million post-paid mobile subscribers.

The move could ensure a major benefit for over 13.8 million fixed-line subscribers (41 per cent of its total fixed-line base) who are based in rural India and have negligible insurance cover against accident or personal disability.

More importantly, it is going to cover lower middle-class households.