The Hindu Business Line : Many a slip between the Clause and the Loss

COMPANIES and individuals often lose out on insurance claims simply because of common underwriting mistakes. A sample — not intimating the change of address to the insurance company, even while taking care to inform banks and other statutory authorities.

Another example — the insurance policy is seldom read except when it is time to file a claim. And then, companies discover that they do not even have the cover that they are supposed to have taken.

These and more were narrated at a seminar on `Navigating your way through the claims labyrinth' organised by India Insure Risk Management Services Pvt. Ltd.

Detailing an instance of how a car dealer suffered Rs 6-crore loss in the recent floods in Mumbai, Mr R. Srivatsan, surveyor, pointed out that it came about because the Storm, Tempest, Flood, Inundation (STFI) clause had been excluded. Apparently the agent had quietly got the cover excluded in an attempt to reduce the premium charges for the dealer.

Mr V. Thiagarajan, Branch Claims Manager, Tata AIG General Insurance Company, who chaired the session, said insurance companies would apply the "6P check" — Premium, Person, Property, Place, Peril and Period — while evaluating claims.

Urging customers to take care to read the policy and the fine print, Mr Thiagarajan said they needed to be sure of what they wanted from the insurance company. De-tariffing which was expected soon would see insurers fine-tuning their policies to suit specific requirements of different companies, he said.

Mr V. Ramakrishna, Managing Director, India Insure, said companies needed to establish proper risk management practices. Often, there were no procedures for buying insurance in many companies. Many companies who signed blank policy forms (which would be filled up later by the agent/ broker) had no idea of what they were buying.