August 20, 2018

The Insurance Regulatory and Development Authority of India(IRDAI) has issued guidelines for speedy-settlement of the insurance claims of victims of recent floods in Kerala.

By a circular dated 17th August, insurers have been directed to take immediate action to ensure that all the reported claims of life insurance are registered & eligible claims are settled as expeditiously as possible.

Several public sector insurers have expedited their claim process in Kerala after the insurance regulator, Insurance Regulatory and Development Authority of India (Irdai), asked for faster settlement of claims in the state that has been ravaged by floods.

Motor insurance is expected to generate largest claims for the companies whereas for crop insurance, the Agriculture Insurance Company (AIC) is expecting claims of about Rs 150-160 million.

With regard to claims where difficulty is faced in obtaining death certificate due to non-recovery of body, the insurers have been advised to adopt the procedure followed in case of 2014 J&K floods which was also followed in 2015 Chennai floods.

The insurers have been urged to follow a simplified procedure including relaxations in usual requirements wherever feasible to expedite the settlement of claims.

A similar circular has been issued for dealing with non-life insurance claims. The insurers have been asked to set up special camps/offices for claims’ settlement, and to give wide publicity about their details in print and electronic media. The details regarding measures adopted in that regard are to be informed to the IRDA by the insurers.

They're also advised to appoint a senior officer who'd act as a Nodal Officer for the State, who would be co-coordinating/expediting the settlement of all eligible claims that are reported in Kerala. Adequate no. of surveyors are also to be deployed in each district.

In order to gauge the magnitude of the loss, all non-life insurers (Including Standalone Health Insurers) were advised to submit information relating to insurance claims in Kerala on a daily basis, in the prescribed format.

Meanwhile, the AIC, which had a sum insured of about Rs 600 million, would pay only 25 per cent. If damage is during the sowing period, insurance companies are liable to pay only 25 per cent of the sum insured under the Pradhan Mantri Fasal Bima Yojana (PMFBY). The floods had a devastating effect on paddy plantation.

 

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