SBI Credit Card Rules Change: Free Insurance Cover Removed From July 15

Premium Cardholders Lose ₹1 Crore Insurance Cover as SBI Restructures Key Terms

What happens when a silent clause gets removed overnight? Cardholders are now waking up to a notice that may impact their financial planning more than expected.

Starting July 15, 2025, SBI Card has introduced major policy changes that affect millions of users. The air accident insurance cover of up to ₹1 crore, once attached to premium credit cards, will no longer be available. 

Along with that, the company has also restructured the way payments are settled and how the minimum amount due (MAD) is calculated. These updates were confirmed through multiple public notices released on the official SBI Card website earlier this month.

Insurance Cover Discontinued for Premium Cardholders

Premium SBI credit cards such as Elite, Miles Elite, Miles Prime, Prime, and Pulse earlier came with complimentary air accident insurance ranging from ₹50 lakh to ₹1 crore. That benefit has now been fully withdrawn. 

As per the public notification issued by SBI Card, this discontinuation will come into effect from July 15, 2025, for most cards. For co-branded cards, the changes will roll out from August 11, 2025.

The discontinued insurance benefit includes accidental death cover during air travel, which was offered without any extra premium. Many cardholders were unaware they were even covered under such a scheme. Now, they must seek personal insurance elsewhere, especially frequent flyers.

Previous Insurance Coverage (Now Removed)
 

Source 

Next, the change in payment settlement structure brings in new financial order for credit card users.

Read More – RBI’s New Credit Card Rules: How It Affects Your EMI & Loan Eligibility

Settlement Order Now Prioritises Government Dues and Charges

Another key update is the change in the order of payment settlement. This determines which part of a cardholder’s dues get paid off first when any amount is paid.

Earlier, retail purchases were typically adjusted early. However, under the new rules effective July 15, SBI Cards will first adjust taxes and fixed charges before any spend-related amounts. That means the interest-bearing balances like cash advances or retail spends may remain unpaid longer, which can lead to higher interest accumulation.

New Order of Payment Settlement
 

This structure has been detailed in SBI Card’s official customer notice dated July 5, 2025. It ensures that statutory dues are cleared first, keeping the company compliant with tax authorities. However, it leaves less breathing space for consumers with rolling balances.

To understand how these changes will affect monthly bills, one needs to look at the revised MAD rule.

Minimum Amount Due Calculation Gets Tighter

As part of this policy overhaul, SBI Card has updated its MAD formula. The new rule states that the minimum due will now include the entire amount of GST, finance charges, EMIs, and all applicable fees, plus 2 percent of the remaining balance.

Previously, cardholders could clear as little as 5 percent of the total outstanding to avoid late payment fees. Now, the threshold has been raised significantly.

Revised MAD Breakdown
 

Over-limit amount (if applicable)

100%

Remaining balance

2%

This change forces users to pay a much higher amount each billing cycle, reducing the tendency to revolve credit at low cost.

Next, it’s important to look at who else this affects apart from standard cardholders.

Also Read - How to Apply SBI Credit Card – Step-by-Step Guide

Co-branded Cards and State-Wise GST Variation Also Included