Insurers to hold meeting to decide claims settlement process for Kerala, Karnataka floods

Insurance companies are likely to meet on Tuesday and Wednesday to discuss the claims settlement process for those affected by floods in Kerala and Karnataka.

This will include the uniform process to be followed for the claims and the process to be followed in case of absence of documents.

The Kerala floods, which were the worst floods in the state in almost a century, caused heavy loss of life and property. As many as 361 people died due to the flooding caused by heavy rainfall across the state.

In Karnataka, 17 people died flooding and landslides caused by rain.

"The claims process will have to be streamlined to ensure that they are settled expeditiously. A similar one to the mechanism followed during the Assam and Chennai floods will be used for the Kerala floods," a senior insurance official told Moneycontrol.

After this, a detailed statement on the documents required for submitting claims will be released by each of these companies on their respective websites.

Initial estimates suggest that the insured losses could touch Rs 700 crore. This would include motor insurance and crop insurance losses due to heavy destruction to vehicles and crops.

The insurance regulator has asked companies to nominate a senior officer who would act as a nodal officer for Kerala/Karnataka for coordinating and expediting the settlement of all eligible claims.

The insurers will also have to submit a weekly report on the claims to the Insurance Regulatory and Development Authority of India (IRDAI).

For crop insurance, it is likely that insurers will use geo-satellites to assess the extent of damages and pay claims accordingly.

The Pradhan Mantri Fasal Bima Yojana aims at providing financial support to farmers suffering crop loss/damage because of unforeseen events.

It is also likely that little or no documentation will be required for claims under Pradhan Mantri Jeevan Jyoti Bima Yojana and Pradhan Mantri Suraksha Bima Yojana, which are the life and personal accident insurance schemes sponsored by the central government.

Given that several areas are still cut-off due to flooding, insurers could also tie-up with local auto manufacturers and dealers to expedite the process of claims settlement for motor insurance.

Basic repairs and replacements will be done locally.

The insurers will meet and discuss what will be the basic documents required to submitted for claims settlement. In cases of death where the body has not been recovered, a letter from a local authority could be a valid proof.

For corporate customers in Kerala, insurance companies will not just consider the physical losses to the commercial property/factories, but will also look at loss of business and man-hours due to a complete shutdown in the state.