The Hindu Business Line : Insurance cos brace up for flood claims in Surat

Insurance companies will soon be inundated with motor claims from the Gujarat floods. According to reports from surveyors, around 50,000 cars and 75,000 two-wheelers in Surat have been damaged in the floods. This overshadows Mumbai's tally of motor claims due to the floods last year, which stood at 16,000 cars and 30,000 two wheelers.

Mr Mahendra Dhruva, National President, Institute of Insurance Surveyors and Adjusters, said that public sector general insurance companies as well as private companies were holding meetings to evolve a common strategy for dealing with flood-related claims.

Surveyors' Report

"Most of the cars have been fully submerged as the flood levels ranged from four feet to 21 feet in Surat. So, the vehicles are likely to be completely damaged," Mr Dhruva said. He also said that surveyors had suggested to insurance companies that customers could be provided with three options. Insurance companies should either offer to write it off as a complete loss, pay a lump sum or reimburse the repair expenses.

As per the surveyors' report, around 30,000 Maruti, 12,000 Hyundai and 3,000 Honda cars have been damaged. Insurance companies that will face the maximum number of motor claims include New India Assurance, National Insurance Company, Oriental Insurance Company, United India Insurance Company, Iffco Tokio, Bajaj Allianz and HDFC Chubb.

Repair Facilities

Mr Srirang Samant, MD & CEO, HDFC Chubb, said that problems due to motor claims in Surat were going to be more magnified than it was in Mumbai as there would be enormous pressure on repair facilities. "The cost of repairs and replacement will increase due to an imbalance in demand and supply as is always the case," said Mr Samant.

Maruti Udyog Ltd, which has the largest number of damaged cars to deal with, has plans to shift the vehicles to a higher ground so that they can service and provide spare parts. Company officials said that additional manpower was being brought in through Maruti authorised service stations outside Surat as well as Gujarat.

The existing five Maruti authorised service stations in Surat would work on a double shift thus operating with a capacity of 10 workshops, said an official at Maruti Udyog Ltd. The Mumbai flood last year had caused a loss of around Rs 200 crore in the motor portfolio.