Insurance companies are busy settling claims in Kashmir, and have so far given out close to Rs 300 crore to people and businesses affected by last month’s devastating floods – more than three times the compensation the state government has doled out. Claim settlement is expected to pick up further after Diwali holidays, say insurance executives.
“We have settled nearly 3,500 of around 6,000 claims that we have received, surveyed and paid,” said Aijaz A Khan, regional head atBajaj Allianz, a private insurer. “We have madeRs 150 crore payments and it is a continuous process.” Bajaj Allianz’s tie-up with Jammu & Kashmir Bank, which controls more than 60 per cent of both loans and deposits in the state’s banking sector, had helped the insurer expand in the market.
“They are working round the clock,” a J&K Bank executive said, referring to Bajaj Allianz’s response to the surge in claims. State-owned insurance companies had gone to the Supreme Court against a high court order directing them to pay half the claimed amount immediately to the insured. Insurers wanted elaborate surveys before making any payment. After the top court upheld the high court’s decision, they have improved delivery.
United India has settled 1,264 of the 2,626 claims it received and has already paid Rs 59.41 crore. National Insurance Company has paid Rs 49.27 crore to 1,108 of the 3,296 claimants who had their properties destroyed, and New India Assurance Company paid Rs 26 crore to 1,087 clients. Oriental Insurance Company has settled 210 claims, paying Rs 4 crore.
“We anticipate ending up paying around Rs 1,000 crore,” Hazara Singh of National Insurance Company said.
Though the World Bank and Asian Development Bank are expected to offer a professional assessment of the overall losses, the state government has tentatively put it upward of Rs 1 lakh crore. The state has submitted an aid proposal for Rs 43,995 crore to the central government.
Prime Minister Narendra Modi, who is visiting Srinagar on Diwali, is expected to announce a package. Modi has already announced a Rs 1,000 crore aid, but the state government says it has yet to get anything.
From its own resources, the state government has paid barely Rs 90 crore as part-compensation.Even banks have become very conservative on lending now. Their priority is restructuring existing exposure and are waiting for possible schemes envisaging interest subventions.