Insurance process simplified

SURAT, Sept 22: In a bid to settle insurance claims arising from last week's devastating floods here, the four subsidiary companies of Ge...

SURAT, Sept 22: In a bid to settle insurance claims arising from last week8217;s devastating floods here, the four subsidiary companies of General Insurance Corporation have agreed to relax certain rules mandatory in normal circumstances. Losses due to the floods have been estimated at Rs 2,300 crore in only the textile and diamond sectors.

The state government has already held meetings with the representatives of all the four companies and has requested them to expedite the process of settlement of claims to help industries to be back on its feet. They have also held a meeting with the Southern Gujarat Chamber of Commerce and Industry SGCCI which has requested them to simplify the settlement procedure and not to insist on documents the affected claimant would find difficult to produce.

The companies have agreed to go for on account payment, something they did not do during the last flood, to allow small units to regain posture. The companies have also agreed to waive production of the certificate of destruction in case of perishable goods from either the SMC or FDA and First Information Reports lodged with the police.

Tho company will also accept private panchnama in cases where owners don8217;t have proof. Since all claims are below Rs 15 lakh payments will be made locally, surveys will be carried out within three days and payment also made within three days as policies based on depreciation require few details.

The progress of settlement will be reviewed every week and companies will send a confidential report every week to the district collector.

Explaining the ease with which rules were relaxed, divisional manager of Oriental Insurance Company Amitabh Mitra said: 8220;It is common knowledge which areas were worst affected. We won8217;t insist on many formalities like FIRs and certificates of destruction of edible stuff8221;.

He is, however, sceptical of the On account settlement criteria. 8220;That is a self-defeating arrangement. Some might end up getting more than what they lost8221;.

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All insurance companies are gearing up for possible fraudulent claims, but agree they cannot make the majority pay for a handful of dishonest claimants. Mitra, however, strikes a cautious note: 8220;Some exceptional cases might require scrutiny8221;.

According to SGCCI president Rajendra Chokhawala, the companies have promised to settle all claims within a month. The chamber will take up individual claims which are not settled on some account or the other.

The companies have already received about 2500 claims and the number is likely to go up to 4,000, say sources. Most claimants are owners of powerlooms from the worst affected Ved Road, Kapodra and Varachhha areas, some of which were under 15 feet water for quite some time. The industry has estimated losses at Rs 2300 crore only in the textile and diamond sectors.

Following the experience after the last floods, when settling claims was not very easy, the industry has decided to involve additional chief secretary finance K V Bhanujan from the start during their meetings with insurance companies. 8220;The strategy8221;, says a source, 8220;has paid dividends8221;.

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Some claimants began informing the insurance companies immediately after the flood waters receded on Thursday night; some claims are still trickling in. The companies are aware that some insured persons might still be living in areas cut off by the flood waters and take some time to approach them with claims.