[svsantosh]

The Times of India - 11-April-2008 (Bangalore, Page-22)

CONSUMER WATCH


The fine print in motor accident insurance claims



Rucha Biju Chitrodia | TNN




To the rising tribe of car owners, motor insurance is reassuring. Many, though, do not know the nitty-gritties of the claim procedure. In the unfortunate circumstance of an accident or damage, it appears, the vehicle must undergo scrutiny from an insurance surveyor, who assesses and quantifies the loss and prepares a report. Other than the terms and conditions of a policy, the release of the insurance claim amount depends heavily on this report.
An insurer can employ its own surveyor for damage under Rs 20,000. Companies TOI spoke to say in-house service engineers are employed for small claims to lower the claim amount release time.
However, in case of claims exceeding Rs 20,000, Section 64 UM of the Insurance Act, 1938, stipulates that, unless otherwise directed, the insurer must obtain a loss report from an approved surveyor or loss assessor.
Thus, in a higher claim, an independent surveyor is mandatory. Mahendra Dhruva, national president at the Institute of Insurance Surveyors and Adjusters, says the world over, this practice helps avoids bias in the loss report.
Dhruva, though, says certain private general insurance companies have started sending across their own surveyors even for losses that cross the mandated limit. This, he says, is a violation of the Insurance Act. “We have submitted written proof to both the IRDA (Insurance Regulatory and Development Authority) and the General Insurance Council about this trend.’’
While an IRDA official denies knowledge of this development, K N Bhandari, secretary general at the General Insurance Council, admits to having received a representation from the surveyors’ body. Bhandari says the allegations are not true and companies are complying with IRDA regulations. He, though, points out that insurers conduct an in-house verification of surveyors themselves. “It is a system of double check.
That is strictly according to law. (But) we are discussing the issues with the companies and the surveyors’ association. We will also have a joint meeting shortly to discuss them.’’
Dhruva says companies are resorting to their own surveyors to cut costs. “If they have to conduct 10 surveys for claims above Rs 20,000, their surveyor cost will be nothing less than Rs 15,000.
Now if they have their own employee surveyors, they can carry out hundreds such surveys in a month. Which is why private insurers employ 10-15 people to carry them out. At the same time, these in-house surveyors dictate terms to the insurer too.’’
Consumer organisations such as Ahmedabad’s Consumer Education and Research Centre and Delhi’s Consumer Voice point to disputes over underestimation of damages.
A senior insurance official too admits to “differences over issues like depreciation. The client may not agree to the amount’’.
Consumer Voice’s K L Madhok, an insurance educationist, says it is the surveyor’s responsibility to verify the ground reality of a claim.
Generally insurance companies abide by the report, although it is not binding on the insurer. “Ultimately the decision has to be taken by the insurer,’’ says the IRDA official.
Only in case of “hanky panky’’, when the company doubts a report’s veracity, does it call upon another surveyor. “Companies can engage up to three surveyors.’’
Madhok, though, emphasises that one surveyor cannot be tied with one company.H K Awasthi, also of Consumer Voice, points to another grouse — sometimes surveyors reach a site to assess the damage too late, by which time the proof of the damage has been minimised.
The Insurance Surveyors and Loss Assessors (Licensing, Professional Requirements and Code of Conduct) Regulations, 2000, clearly state that a surveyor or loss assessor shall submit his report to the insurer within 30 days of his appointment... Provided that in exceptional cases, the afore-mentioned period can be extended with the consent of the insured and the insurer.

WHAT DO YOU GET?


Clear written communication from the surveyor for easy and simpler claim documentation Immediate clearance towards restoration of affected items Early disposal of salvage/ debris arising out of claim Surveyor’s competency (expertise in related fields) Discussion on documents as required by the surveyor for assessment of claim Assistance on loss minimisation Source: Sanjay Datta, head, customer service health, accident, ICICI Lombard

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Mods, I did not want to create a new thread, Please post it as a new one if you feel the need, Possible discssions -
(1) Does every one know about the role of a Inhouse Vs a External Surveyor?
(2) How many tBHPians have come across a Accident claim and understood what the surveyor has done for us?(or the company)
(3) Public Vs Private insurance companies, which works by the book and can be trusted?, which bends the rules more often?