Cyclone Michaung and the ensuing heavy rains/floods in December 2023 have inflicted extensive damage on human lives, properties (residences and businesses), and infrastructure across multiple states.
In response, all insurance companies are urged to activate their resources promptly, ensuring swift service response, according to an Insurance Regulatory Development Authority of India (Irdai) circular.
This includes mobilizing external functions like surveyors, loss adjusters, and investigators.
Cyclone Michaung: In 2023, a powerful cyclone named Michaung formed in the Bay of Bengal during the North Indian Ocean cyclone season. Starting as a low-pressure area in the Gulf of Thailand, it moved into the Bay of Bengal, becoming a deep depression on December 2.
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Gradually intensifying, it reached cyclonic storm status and was named Michaung, marking the ninth depression and sixth named storm of the season.
Moving northwest, it hit the eastern coast of India, bringing heavy rainfall to areas like Chennai and Andhra Pradesh. Michaung made landfall near Bapatla, Andhra Pradesh, on December 5, with peak sustained winds of 110 km/h (70 mph).
Here's what you need to know about the recent directive from Irdai:
Choose a Senior Executive to serve as the Nodal Claims Officer in charge of handling claims. Notify the relevant state's Chief Secretary about the appointment without delay.
Assign a district claims service head to manage areas with high claim numbers in those districts.
Share the contact information of state/district heads on the insurer's website, and consider publicizing it in the press as well.
Insurers must set up and publicize 24/7 helplines to assist claimants. Additionally, they should initiate a comprehensive awareness campaign to highlight the measures being taken.
Establish special claims desks at the district level with sufficient delegated authorities for claim settlements. This will speed up the processing of claims and settlements, including the release of interim payments, to help in the early recovery of property and businesses in affected areas.
Make sure to promptly survey all claims and disburse claim payments or on-account payments as quickly as possible
Hire enough surveyors and loss adjustors right away. If necessary, consider deploying resources from neighboring states as well.
Insurers should advise policyholders to opt for electronic communication when initiating claims and submitting relevant documents. They should make efforts to use digital processes as much as possible for claim assessments.
Insurers should review and simplify the claims processing by requiring only essential documentation to support the claim amount, ensuring a speedy final settlement.
For claims related to loss of life, if obtaining a death certificate is challenging due to reasons like the non-recovery of the body, and if the insured's details match those published by the state/central government or relevant authorities, the claim may be considered without requiring a death certificate.
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All insurers, including life and standalone health insurers, should share details of cyclone/flood claims with Irdai using the attached format, according to the circular. General and health insurers should send this information to nl-catastrophe@irdai.gov.in, while life insurers can send it to life@irdai.gov.in every week for one month.
