Indian insurers are gearing up to fork out a substantial amount as claims in the aftermath of the Nepal earthquake.
Public sector GIC Re, the only Indian reinsurer and also the largest in Nepal, is expecting around a $160 million (close to Rs 1,000 crore) hit from the damages caused by the earthquake. “$160 million is the maximum we should be paying in the worst scenario.
We have done the business of reinsurance (insurance that is purchased by an insurance company) with 13 Nepalese non-life companies and account for about a quarter of the total insurance in the country. We are expecting claims from segments like power plant, housing, buildings and hotels. The claims may lead to higher reinsurance premium in the region,’’ GIC Re chairman A K Roy said.
The losses would rise as other PSU insurers operating in Nepal, including National Insurance and Oriental Insurance, are also expected to settle claims. All non-life insurance policies sold by the Indian insurers in Nepal are reinsured with GIC Re.
GIC Re has sent 10 surveyors to Nepal at the request of non-life insurers to help assess the damage. “A clearer picture will be available after a week. We expect some claims from Bihar and Uttar Pradesh on the life side. Motor insurance claims are also expected,” said an official.
Life Insurance Corporation (LIC), which is operating in Nepal through a joint venture, assured that it would settle all the claims. “I have sent an advisory note to LIC Nepal to follow the same method which LIC does in India in such circumstances,” LIC chairman SK Roy said.
“LIC Nepal is expected to get a better idea of the claims in the next two weeks,” said an official.
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