FDI limit in insurance may go up

Adsul was in Mumbai to inaugurate an insurance seminar on claim management organised by Delhi-based Green Arch Stockfin Ltd. However Adsul had ruled out any roll back of 8 per cent service tax which will adversely impact the insurance industry.

‘‘We are not going to reconsider it,’’ he said adding that both insurance companies and consumers have to share the financial burden of the government.

Expressing his unhappiness on the time consuming claim management system of the state owned general insurers, he hinted that the government is preparing a series of new initiatives on this front. ‘‘We are formulating detailed guidelines for the quick settlement of claims by the state general insurers,’’ he stated. The government may set up Lok Adalat type bodies to expedite the claim management process.

Adsul pointed out that the centre is also thinking bring in laws to make it mandatory for the private sector general insurance companies to transact loss making motor insurance portfolio which has thrusted heavy loses on state general insurers.

‘‘We are working on it along with the proposal to hike the motor insurance premium,’’ he said. Participating in the conference R. Beri, CMD of New India said that his company has a quick claim ratio 80 per cent and the company is taking stringent measures to settle all pending claims.

‘‘I have asked my people to be transparent in their claim settlement process and not to harass the customers,’’ he said.

The loopholes in the legal system is hampering setting up of an efficient claim management system by the insurance company, he felt. ‘‘Even after receiving the claim within a month, people are approaching the court within 90 days to demand a higher claim to the much disadvantage of the state insurers,’’ he lamented.

Beri revealed that IRDA has convened a meeting of the insurers to take a final decision on stopping of the five per cent discount by the insurance companies to corporate clients.

Earlier, CMD of a leading bank had exhorted insurance companies to settle the claim quickly so that the industry doesn’t have to incur the losses.