After rain, the bill: insurance claims cross Rs 2,000 cr

Mumbai, July 31 | Updated: Aug 1 2005, 07:06am hrs
The unprecedented rain and the consequent flooding of Indias financial capital Mumbai last week have resulted in huge insurance claims from India Inc.

Till Sunday afternoon, the claims bill from major corporates and retail segments had crossed the Rs 2,000 crore mark, threatening the health of the domestic insurance industry.

The top four private sector general insurance companies, ICICI Lombard General Insurance, Bajaj Allianz General Insurance, Iffco Tokio General Insurance and Tata AIG have together received claims worth over Rs 1,000 crore.

The four state-owned general insurance companies New India Insurance, Oriental Insurance, United Insurance and National Insurance too have received claims of close to Rs 1,000 crore.

Add on ONGCs Mumbai High claims and this will be the worst year for the Indian general insurance industry triggering a change in the perception of the countrys risk .

Wholl Pick Up The Tab
Claims may rise in the coming days
Losses have been reinsured with GIC and overseas reinsurers
Insurance companies may have to liquidate investments to meet claims
May worsen risk-perception of India
The silver lining in the crisis is that the claims are reinsured with state-owned official reinsurer General Insurance Corporation and leading reinsurers in the London market.

The insurance firms have already sent an SOS to their reinsurers to draw out funds which, in insurance parlance, is called cash call, to meet the immediate demands of part-claim settlements of their prime corporate clients.