GIC warns of stringent action against insurance consultants making false claims

BENGALURU: General Insurance Council on Tuesday has warned of action against insurance consultants making false claims over the Coronavirus pandemic. False advertisements urging corporates, SMEs, shop owners to file lockdown claims has come to the notice of the regulator Irdai.

In a public advisory on Wednesday, the GI Council said that loss of profit or business interruption insurance coverage is only for coverage of "insured perils" such as fire, earthquake, floods, tsunami, etc and not in the case of a pandemic.

GI Council said, "It has come to our notice that some persons claiming to be insurance exports in the guise of advisors, consultants, legal experts, etc are advising, encouraging insureds to lodge claims on their insurers in respect of losses arising due to Covid-19 shutdown."

GI Council further noted that consultants were advising corporates, industrial establishments, shops, hotels, offices, to file such claims under loss of profit, business interruption policies, standard fire policies, etc. And with the assurance, "the broker would get the claim settled."

Source: The Times of India