Natural calamity in Uttarakhand: Insurers peg losses up to Rs 3,000 cr

The industry has started making preparations to deal with the claim-settlement process

Insurance companies in India are estimating losses in the range of Rs 1,500-3,000 crore from the Uttarakhand natural calamity. While the total number of claims are still being assessed, the industry has started making preparations to deal with the claims.

“We have started receiving claims from families, several of whom do not have extensive documents to support it. Here, we have been working to resolve the claims in the quickest time possible,” said the chief executive of a private life insurance firm.

Both public and private life insurance companies, including Life Insurance Corporation of India (LIC), ICICI Prudential Life Insurance, Max Life Insurance, Bharti AXA Life and Bajaj Allianz Life, among others, have set up dedicated processes and personnel to deal with the claims.

ICICI Prudential Life Insurance has simplified the claims settlement process for the families/ beneficiaries of the victims of the Uttarakhand tragedy. The company will accept the list issued by hospitals/police/ armed forces in case a death certificate from the municipal authorities is not available. Further, the company has a dedicated 24/7 helpline to assist claimants with information on making claims.

Similarly, Max Life said the company would accept any evidence from government/designated district officials of the state government or hospital authorities/municipal record showing death due to floods in the northern region of India. Bajaj Allianz Life has streamlined the normal procedure for minimum documentation in order to settle all the claims on priority.

General insurance companies have also begun to engage loss surveyors and loss assessors to get information on the claim amounts. With several hydropower projects situated in the region, industry sources estimate the losses to touch Rs 1,500-2,000 crore.

“Not just property and motor vehicles, large-scale projects have also been impacted. We are assessing those claims and helping them to restore operations as soon as possible. While we will take a hit on our books due to these claims, the current focus is to provide relief immediately to the affected,” said the claims director of a private general insurance company.

While insurers have been speeding the process of claims-redressal, players do not rule out false claims being issued. A senior life insurance company official commented while minute details for claims processing will be overlooked in this situation, there have been a few cases where investigations are being done to prove the veracity of claims.

“Disputes are bound to arise in some cases. However, we are looking at resolving the situation as amicably as possible, with minimum damage to both the parties, ie, the insurer and insured,” said a senior general insurance industry official.

According to Aon Benfield's Annual Global Climate and Catastrophe Report, there was an estimated economic loss of Rs 1,517.1 crore in 2012 from natural disasters in India, including floods (India and Bangladesh) and Nilam Cyclone (India and Sri Lanka).