Vehicle claims may not be cleared if insurance not renewed for lockdown

KOLKATA: Leading insurers and insurance broking firms have appealed that cars submerged in water after the downpour on Wednesday should not be restarted before 24 hours after water recedes. For damaged property, the firms have advised owners to take photographs and videos before removing or clearing the area.

A day after Cyclone Amphan ripped through Bengal, including Kolkata, leading insurance companies on Thursday said they expected a huge number of applications to settle claims for property and motor damage. Going by an even conservative estimate, they believe a few thousand cars were battered on Wednesday night. The number of houses in the city damaged were also pretty high but insurance companies deal in very few residential properties, as low as merely 1% in Kolkata. Mostly, commercial and industrial properties are usually covered. Bajaj Allianz, along with the likes of National Insurance and Bharti Axa, has started taking measures, such as sending messages to customers and preparing marketing team for settlement of claims in Kolkata, the biggest market among affected zones in cyclone. Milind V Kohe, chief of underwriting and reinsurance, Bharti Axa, said it has communicated internally for speedy settlement of claims.

But Rahul Agarwal, founder of Ideal Insurance, one of the leading insurance broking firms, pointed out that some car owners, who were scheduled to renew their motor insurance in March to May but had not yet owing to the current lockdown, were not likely to get their claims cleared. “We have already received a lot of calls from car owners who have not renewed the insurance because of the lockdown. Most of them had thought of making the payment next month as they were not using the car at the moment,” he added.

Agarwal pointed out if vehicles were submerged in water, it was advisable not to start the engines to avoid any chance of the claim being repudiated. Echoing him, head of motor (OD) claim of Bajaj Allianz General A V Padmanabha said if the water was above the level of tyres it was better not to restart the engine before consulting a technician. “There is a thing called engine lock. If that happens, it would further the damage,” he said. Padmanabha said insurers usually paid part of insured declared value (IDV) for motor damage but if the vehicles was found to be irreparable, the owner will get majority of its IDV, that would take into account depreciation as well.

Source: The Times of India