The Hindu Business Line : Indian Hotels gets Rs 25 cr in insurance claims

Mumbai, Dec. 11 The Indian Hotels Company on Thursday received Rs 25 crore in insurance claims arising out of the terror attack on the Taj Mahal Hotel, Mumbai.

This is the first payment made to the hotel against its claims, and which was paid from the terror insurance pool by General Insurance Corporation of India (GIC Re), the designated administrator of the pool.

The payment was made after Tata AIG, the lead cover provider to the Taj Mahal Palace and Tower, submitted the claims report to GIC Re, a press release issued by GIC Re said.

Three insurance companies — Tata AIG General Insurance (65 per cent share), ICICI Lombard General Insurance (30 per cent) and IFFCO Tokio General Insurance (five per cent) — jointly provided the insurance cover to the hotel.

However, claims arising out of any terrorist activity are paid from the terror insurance pool formed by the general insurance companies in 2001. Therefore, irrespective of which company issues the policy, the claim is borne by the pool. The total corpus of the terror pool currently is around Rs 750 crore.

A senior GIC official said, “Though no assessment has been made about the total claim, this amount is a token gesture to assuage the company that the claims are admissible and to ease the cash flow for the company. The final report will only come once the independent surveyors assess the damage”.

The official said that the total losses incurred by Taj Mahal Palace and Tower, Trident, Mumbai and The Oberoi Mumbai could be around Rs 500 crore.

Regarding payment to The Oberoi, the official said that though no claim has been received, they are working on granting a similar facility to The Oberoi as well.

Meanwhile, The Oberoi Group told Business Line it has not claimed any insurance amount so far. The group is currently focussing on the repair work and commencing operations of its hotel, Trident, Mumbai at the earliest.

Damage assessment

Mr S.S. Mukherji, Vice Chairman of The Oberoi Group, said, “While our insurers are keen to give us some ad hoc amount, our cash flow is good enough to take care of the damages currently. We will look into it (insurance claims) later. The assessment of damage to The Oberoi property is still on. Our focus for the moment is to open Trident.”

New India Assurance has provided lead cover for the Oberoi’s properties, which were also under siege from gun-men who attacked Taj and Oberoi among other locations on November 26.

The hospitality group plans to re-open its Trident, Mumbai from December 21, as the damage to that hotel has been relatively less.