While we eagerly wait for the monsoon every year, excessive rains can cause severe damage to life and property. Insurance is the only scientific method of ensuring recovery from such disasters, at least in terms of the economic value of the assets lost.
Any person holding policies such as the householder’s policy, house policy, motor policy, etc., may hope to get
adequate compensation by way of claims settlement. However, the process is not as simple as one expects it to be on the basis of the face value of the policy. The policyholder has to be very cautious and careful while lodging the claim with the insurer.
Submit details for claims
As soon as the flood recedes, the policyholder has to get hold of his policy document. If the document is not retrievable, then trace the policy number from a soft copy. He should then read the terms and conditions and prepare a list of damages and submit it to the insurer. Care should be taken not to displace or remove such items from the place of occurrence. The normal response of the insurer would be to depute a loss assessor to inspect the affected site or the damaged property. Hence the items should be allowed to be inspected in the as is where is condition.
Insurers have their own yardstick to evaluate the loss caused in such situations. The fine print is the description of exclusions from the cover. The insurers print certain conditions under which the expected claims are excluded. In normal course of transactions while buying a policy, the customer may not be made aware of such exclusions. Policyholders should be very careful while buying a policy and while filing claims. If they are not satisfied with the assessment of loss made by the insurer they need to insist on a review of the assessment before signing the discharge voucher for settlement of claims. One of the major losses suffered by people in urban areas is in respect of motor vehicle.
A comprehensive motor insurance policy does cover losses due to flood, fire, theft, arson, etc. The policyholder should ideally take photograph of the vehicle submerged in water or swept away to another location away from the road and he should furnish that photograph while filing the claim. He should not try to drive the vehicle or to get it repaired before the representative of the insurer has inspected the vehicle. Under the standard comprehensive policy one should not expect claim against damage to the plastic parts, upholstery, etc., but compensation for entire cost for all mechanical work and concerned replacements must be expected. If the insurer denies such claims, the policyholder needs to register his dissatisfaction and request for review of the claim amount.
Be patient with procedures
In the situation where natural disaster is on the scale of a catastrophe the insurers also find it very difficult to meet all the expectations of the policyholders in terms of due diligence and prompt settlement of claim. The difficulties of the insurers also must be understood by the claimants and they need to be a little patient with the official procedures which insurers cannot afford to overlook.
Following the unprecedented flood causing widespread damages in Kerala, Irdai has instructed all insurers to step in to settle claims as soon as possible for those who suffered loss of life and property. The government has also instructed all life insurers to settle claims in respect of the Jeevan Jyoti Bima Yojana, Suraksha Bima Yojana and the Fasal Bima Yojana without any delay. The insurers have also been taking proactive actions in this regard. For securing the real value of insurance in such situations, the claimants need to be fully aware of the claim procedure and the claim amount that he is entitled to under the policy that he holds or a deceased relative held on his life or property.
In case one is not satisfied with the amount of settlement of claim one must raise the matter in appropriate forum such as the insurance ombudsman, consumer forum, etc. A policyholder has absolute right to receive monetary value of the lost or damaged property to the extent of amount of risk cover stipulated under the policy that he purchased for protecting his interests in the event of unforeseen circumstances.
The writer is former MD & CEO, SUD Life