Kerala: As claims begin to flood in, insurers work overtime to speed up settlements

What does it take to rebuild your life after rain waters and floods wash away or damage a huge part of it? Along with a good dose of optimism and determination, money is a key factor.

This is where insurance covers come in handy. While the government and insurers are working to not just process but also expedite claim settlement in the aftermath of the floods, the first thing to check for a policy holder is whether the cover provides insurance against natural calamities like floods.

For instance, many of those impacted by the Chennai floods of 2015 recount how, when they applied for insurance, they were told that their policies did not include protection against natural calamities.

“I applied for an insurance claim for my library which consisted of priceless journals, but it was rejected as it did not cover natural calamities. The claims of many neighbours for motor insurance or household goods were also similarly rejected,” said G Boopathi, former librarian and a resident of Arul Nagar, Urapakkam (West) in Chennai, which was one of the worst affected areas in the 2015 floods. Similarly, some also spoke about problems they faced in the assessment of losses by insurance companies.

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Insurers also emphasise that it is essential to check whether the cover provides protection against floods.

“It is essential to note that the vehicles must have a comprehensive cover that includes protection against flooding of engine,” said an executive with an insurance firm, adding that consumer awareness is also required to ensure that they do not start vehicles that were submerged in water.

The vast majority of claims after the floods are expected to come from motor insurance apart from a few big-ticket claims from sea ports and the Kochi airport, which was shut down for nearly a week during the floods and is estimated to have made losses of about ₹220 crore. While no industry-wide data is available at present, insurers believe the claims will be about ₹1,000 crore, and not as high as the near ₹5,000-crore following the Chennai floods.

Since flood waters began to recede in Kerala and neighbouring districts of Karnataka, insurance companies — state-run as well as private ones, have begun to roll up their sleeves. They are setting up camps, deputing additional personnel to the flood-hit areas and are coming out with simplified and, in many cases, uniform guidelines and documents for settling claims.

The Finance Ministry and the insurance regulator Insurance Regulatory and Development Authority have also asked insurers to stick to strict timelines for settling claims.

Insurers ready

State-run general insurance companies under the General Insurers Public Sector Association of India (GIPSA) are fully geared up to settle claims, and have come out with common guidelines and standardised formats.

“Claims have just started to trickle in but it is expected that a large majority of them will be for motor and health insurance. Property and home insurance are yet to catch up on a large scale,” said an executive with a public sector general insurer.

Private insurers are also coming up with facilities such as towing trucks and holding facilities for vehicles that were submerged in rain water.

“We have rushed out personnel from States like Andhra Pradesh and Telangana to Kerala. We have also engaged pick-up trucks to tow the submerged vehicles. We have also engaged an agency to clean up the submerged vehicles and have come out with simpler modes of loss assessment,” said Easwara Narayanan, Chief Operating Officer, Future Generali India Insurance.

Cashless claim settlements for small amounts, waiving off documents, and payments within 24 hours are some of the other facilities that insurers are providing to those impacted by the Kerala floods.

Life Insurance Corporation of India has said it will accept a certificate from any authorised government official, or a proof that the claimant has received ex-gratia from the government, as alternative proof of death. “In deserving cases, a certificate issued by the agent concerned will also suffice, subject to certain conditions. Or, a confirmed development officer can also certify the death,” it said.

It has also set up a special team for speedy settlement of claims from Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and other policies. Insurers believe that much of the life insurance claims would be those from the PMJJBY.

Over 380 people are estimated to have been killed in the incessant rains in Kerala, which are being seen as the worst since those in 1924.

“We have come out with a simplified claim form and eased the document requirement. If everything is in order, we will settle the cliam within 24 hours in these cases,” said Nilesh Parmar, Chief Operating Officer, Edelweiss Tokio Life Insurance.

According to Parmar, in case the identity documents have been swept away in the rain water, the nominees can provide reference details such as bank account numbers, PAN or Aadhaar number.

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