CLAIMS PROCEDURE - IAR POLICIES

1. CLAIMS PROCEDURE - IAR POLICIES Presentation by

2. CLAIMS PROCEDURE CLAIMS – DEFINITION • A demand made on an insurer for performance of contractual obligation as per the policy issued by him. • Only a fair & quick settlement of claim gives tangible shape to insurance contract • desirable guiding principle of claims management is “Pay it, If we can! Repudiate it, If it is must!!”

3. Stages in Claims Management • Notification • Review • Response / settlements • Investigations • Negotiations • Response/ settlements • Recoveries

4. CLAIMS PROCEDURE CLAIM INTIMATION/NOTIFICATION: • BY LETTER, TELEGRAM, TELEPHONE,E-MAIL OR FAX Every notice and other communication to the Company must be written or printed – General Condition No. 13) • It has to be immediate (General Condition No. 1) • To enable insure to investigate and to minimize his exposure under the policy. • Quick notification helps speedy settlement – Claim philosophy aims to provide a high quality service and all legitimate claims are settled promptly and fairly • To explore possibility of recoveries from third parties and to ensure timely compliance of pre-action contacts • Delay in notification may complicate the claims process

5. CLAIMS PROCEDURE A Claim intimation to contain: • Policy No. • Property affected with location and serial no. of the policy • Perils occurred • Date of occurrence • An estimate of loss

6. Appointment of surveyor • Licensed • Categorized • Empanelled • Competent • Immediate appointment on receipt of intimation • No to appointment of any preliminary surveyor • Regulatory norms • Internal Norms set by the insurer i.e. fortnightly reports on progress of loss assessments vis-a-vis on account and final settlement of the claims

7. CLAIMS PROCEDURE Duties of the insured following a claim • Forthwith notification and to furnish, within 15 days, an account of loss and particulars of all other insurances, if any. • To furnish at all times at his own expense produce, such further particulars, plans, specification books, vouchers, invoices, duplicates or copies thereof, documents, investigation reports (internal/ external) • To furnish proofs of origin of cause of loss and extent of loss as may be reasonably required. • To avoid any temporary repairs (material alteration exclusion may be invoked for subsequent claim if any before permanent repair) • The Insured shall not in any case be entitled to abandon any property to the Company whether taken possession of by the Company or not • 12 months disclaimer period has to be borne in mind.

8. Other Conditions • Mis-representation / Mis - description • Fall or displacement • Change of trade/process/occupation/material alteration which enhances the risk/change of ownership • Termination of policy • Forfeiture if claim/declaration being fraudulent • Right of insurer to take/keep possession or to dispose of the same for account of whom it may concern. • Option to the Insurer either to repair or replace • Contribution/Subrogation • Arbitration

9. Basis of indemnity Section I • Calculated on the basis of the reinstatement or replacement of the property lost, destroyed or damaged. • Reinstatement or replacement shall mean : • where property is lost or destroyed, the rebuilding of the property or replacement of any other property by similar property. In either case in a condition equal to but not better or more extensive than its condition when new. • where property is damaged, the repair of the damage and the restoration of the damaged portion of the property to a condition substantially the same as but not better or more extensive than its condition when new.

10. Indemnity is subject to adjustment for (MD) • Cenvat • Average • Excess • Reinstatement premium

11. Basis of indemnity • Section II • (a) in respect of Reduction in Turnover : The sum produced by applying the Rate of Gross Profit to the amount by which the Turnover during the Indemnity Period shall fall short of the Standard Turnover in consequence of the loss destruction or damage. • (b) in respect of Increase in Cost of Working : The additional expenditure necessarily and reasonably incurred for the sole purpose of avoiding or diminishing the Reduction in Turnover which but for that expenditure would have taken place during the Indemnity Period in consequence of loss destruction or damage, but not exceeding the sum produced by applying the Rate of Gross Profit to the amount of the reduction thereby avoided

12. Indemnity is subject to adjustment for (BI) • Trend of the business • Standing charges saved • Average • Excess • Reinstatement premium

13. Exclusions Causes • Faulty or defective design, material or workmanship, wear & tear. • Loss due to F.O.U.S. • Collapse or cracking of buildings • Corrosion & rust • larceny, Acts of fraud, unexplained inventory shortage • Wilful negligence, cessation of work, loss of market • War group of perils • Nuclear group of perils • Destruction of the property by order of public authority

14. Exclusions Properties • Money, cheques, securities of any description, goods held in trust or on commission, computer system records unless specifically covered. • Vehicles licensed for road use • Property in transit outside the premises • Property or structures in the course of construction, demolition or erection • Land, pavements, roads, runways, railways lines, etc., unless specifically covered • Growing crops or trees • Property damage as a result of its undergoing any process • Property removed to other locations for a period exceeding 60 days • Property undergoing repair/ alteration/ testing • Property more specifically insured • Property insured under a Marine Policy

15. Claims decisions • Pay • Negotiate • Settlements – Pay/Reject

16. Thank You Very Much