Insurance companies are likely to face claims worth over Rs 1,500 crore in the wake of devastating floods in Tamil Nadu.
Insurance companies are likely to face claims worth over Rs 1,500 crore in the wake of devastating floods in Tamil Nadu. Industry officials said they expected a large number of these claims from property, automobiles and small and medium enterprises (SME) sectors.
While the earlier deluge in the state, which started on November 8, has already resulted in claims of around Rs 500 crore-600 crore, the recent torrential rains could lead to claims worth over Rs 1,500 crore, insurers point out. The floods in Jammu and Kashmir in September 2014 cost insurers an estimated Rs 2,400 crore in claims.
G Srinivasan, chairman and managing director at The New India Assurance, said, “The condition has become worse after the second spell of rainfall. We expect claims to go up significantly. We have received claims for an approximate Rs 100 crore across 400 claims for motor and small and medium enterprises.” He further indicated that the overall claims for the industry would be around Rs 2,000 crore as the current spell of rains in Tamil Nadu was far worse than the first spell.
State-run United India Insurance has the biggest exposure to the state and have already received around 400 claims of over Rs 300 crore. “As of now rains have stopped and we have started collecting more infornation from our regional offices. I think we should get a clear idea about the loss to the industry in the next three to four days. For us, we expect major losses in householders’ policies and motor insurance policies as most vehicles are under water,” said Milind Kharat, chairman and managing director, United India Insurance.
Easwara Narayanan, COO, Future Generali India Insurance, said they have already received 180 claims worth across Tamil Nadu of over Rs 18 crore. “We expect more claims in the coming days. Unless the water level recedes and the situation improves, we will not be able to comment on the exact figure.”
Sasikumar Adidamu, chief technical officer at Bajaj Allianz General Insurance also said that his company’s claims stood at around Rs 30 crore. “We are still waiting to get clear picture after the recent rainfall. But it is likely that losses would be coming from automobile insurance, home insurance and losses from commerical property.”
Senior officials from the industry also added that, in the next few days they will start receiving more claims as situation on Chennai and other parts of Tamil Nadu resumes to normalcy and than only there will be clear picture on losses to the insurance industry.