Non-life insurers still to settle 25 percent of quake-related claims
March 13, 2017 12:00 AM NPT
KATHMANDU, March 13: Non-life insurance companies are yet to settle 24 percent of the claims arising out of the 2015 earthquakes.
While 16 non-life insurance companies have settled 94.68 percent of the claims in terms of number of claims from policyholders, the settlement in terms of monetary value stands at only 76.04 percent.
According to statistics compiled by Beema Samiti - the insurance sector regulator, non-life insurers have paid Rs 12.81 billion in compensation to settle 16,836 claims as of February 11.
Policyholders had made a total of 17,782 claims for losses worth Rs 16.85 billion incurred by the 2015 earthquakes. Of that, only 11,886 claims for physical damages worth Rs 16.28 billion were considered valid. Remaining 5,896 claims worth Rs 570 million were considered ineligible for the compensation by the insurers. Life insurers are yet to make settlement of claims worth Rs 3.47 billion.
Raju Raman Poudel, a director at the Beema Samiti, told Republica that most of the claims have already been settled while those remaining are the claims with high amount of damages for which the insurers are awaiting compensation from reinsurance companies. “The few remaining cases that are yet to be settled are related to damages on high rise apartments and hydropower companies,” said Poudel.
Lumbini General Insurance Company Ltd has completed 100 percent settlement both in terms of number of claims (880) and claim amount (Rs 254.44 million), while National Insurance Company Ltd (NICL) has settled the lowest number of claims. NICL has made payment to only 661 eligible claims worth Rs 498.3 million.
Insurance companies have received Rs 6.46 billion from their reinsurer to settle claims.
Insurers made the highest compensation payment under the 'fire' heading as they completed settlement worth Rs 8.34 billion compared to the eligible 9,755 claims worth Rs 9.69 billion.
Fire insurance in Nepal, in general, provides coverage of property like office and residential building, factory building, plant and machinery and various equipment from fire, lightning and earthquake.
Similarly, they made payment of Rs 173 million to 874 companies on motor insurance that covers losses from the damage of motor vehicles. There were a total of 741 eligible insurance claims for compensation of Rs 171.9 million.
Claims settlement under 'engineering' stood at Rs 818.1 million for 94 claims. This insurance coverage includes damage to the factory, hydropower and other equipment, and property due to engineering risks during engineering activities, planning, designing, erection, construction, operation and maintenance. There were 110 eligible claims for compensation worth Rs 2.85 billion under this heading.
The 'marine' and 'miscellaneous' insurance claim settlement stood at Rs 753,000 and Rs 3.48 billion, respectively.