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Tuesday, Aug 26, 2003

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`Terror cover would have aided them'

Our Bureau

Mumbai , Aug. 25

MOST of the traders near the temple of Mumba Devi, whose shops were damaged in today's blast, may not enjoy any insurance benefits. Shop insurance does not necessarily cover bomb attacks, say officials at insurance companies.

Officials of most leading public sector insurance companies admit, that the worst affected in cases of terrorist attacks, in terms of loss of property, are shopkeepers, small dwelling houses, small businessmen, etc, who do not have `insurance against terrorism.'

Large corporates are usually the only ones who take this kind of a cover, as there is not much awareness among the public, about the need for `terrorism insurance,' just yet, according to industry sources.

Mr P.C. Ghosh, Chairman, General Insurance Corporation, told Business Line, "At present, it is mostly industrialists and large corporates who opt for terrorism insurance. We want more people to take these kind of covers so that our risk will be spread and the premium burden will be reduced for clients.''

GIC is currently managing a corpus formed by all insurance companies, for terrorism insurance, amounting to roughly Rs 218 crore. This enables insurers to provide terrorism insurance cover for up to Rs 200 crore. According to industry sources, terrorism claims for the fiscal year March 2003, amounted to Rs 9 crore, while claims this year have already aggregated Rs 11 crore.

According to Mr I.J. Jain, General Manager, Oriental Insurance Company, "terrorism cover already existed as an extension of fire insurance. But after the September 11 attacks in the US, the insurance industry has undergone some changes and terrorism insurance is now marketed as a separate product."

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`Terror cover would have aided them'

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