The very recent earthquake in Indonesia has left people not only there but also in India in a state or terror and shock. As various parts of India were hit by the after-shocks of the massive earthquake, many people have pushed the panic button.
Literal earth-shattering news like this makes us re-evaluate our lifestyle. If you are concerned about safe-guarding your family against earthquakes, then take the necessary steps. OracleThinkQuest has collated some precious information from Dharam Bir Gaba, Haryana Vidhan Sabha MLA, and Deputy Superintendent of Police, regarding all you need to know about earthquake insurance –
1. Insurance Scenario in India
India might be the 2nd most populous country but it sure lags behind in the number of insured people. There is still a very big chunk of the working population which refuses to get any form of insurance, be it – life or health. This type of attitude is a pressing problem in our country. So, it is even rare that Indians go for earthquake insurance. As only a few parts of India have witnessed more number of earthquakes, most Indians in general do not give earthquake insurance any thought. We do have earthquake insurance in India but mostly business ventures go for this.
2. How Much Earthquake Insurance Coverage to Buy?
If the recent quakes have compelled you to go for earthquake insurance, then according to Insure.Com, get sufficient insurance in order to cover costs of rebuilding your home and also replacing spoiled belongings. Do not base your insurance coverage on the actual or market value of the property. Include only the amount needed to renovate and rebuild your home. Though this is only an estimate but try and figure out a rough number.
Plus, you should read and understand all terms and conditions of claiming insurance before applying for it. Reading the terms and conditions of earthquake insurance is important because they need to be claimed within a certain period of time. As sometimes the effects of an earthquake are not very apparent, it might take you a while to get a proper estimate of damage.
Most insurance policies do not provide a separate cover for earthquake. A bundle of insurance is mostly available for natural calamities, like – earthquakes, droughts, floods, hurricanes and the like. As Gujarat is among the most earthquake affected area, this region has a special earthquake insurance policy. A few other companies, like – ICICI Lombard, LIC and Royal Sundaram, provide special earthquake insurance. So, the policy amount may differ from one service provider to another.
The policy offered in Gujarat costs 0.6 per 1,000. This insures your house against – fire, natural calamities (earthquakes, cyclones, storms and floods), gas cylinder explosions, riots and even terrorist attacks. However, only the building and its contents are covered, while other areas are not, like – valuables, cash, jewellery, precious stones and metals, securities, bonds and documents.
4. What Happens in the Aftermath of an Earthquake?
In the wake of natural disasters, like earthquakes, it is almost impossible to find the documents related to earthquake insurance from the debris. Though helping people should be your primary goal, claiming earthquake insurance to compensate a bit of your world is on the priority list too. Thanks to digitalization, all information regarding insurance is safely tucked in computers. So, if insurance papers are destroyed in the earthquake, you can ask the insurance company regarding the insurance claim. Divisional offices have access to a lot of data. So, even if offices in the seismic zone are affected, information can still be retrieved. If family members and/or relatives can produce sufficient ID proofs, they too can claim insurance on behalf of the policy holder.
5. What Should Survivors and their Relatives Do to Claim Insurance?
LIC is among the very few insurance companies, which approves of insurance claims from relatives and/or family members. LIC accepts death certificates issued only by municipal authorities. Moreover, it accepts death certificates issued only by insurance agents and/or responsible citizens. If you are claiming such insurance, then contact the insurance agent of the deceased. Ask the agent regarding the insurance details of your relative. You can also contact the insurance agency for the claim. Make sure that you have a valid death certificate of the policy holder.
You will also have to produce some proof that the natural disaster has occurred. Newspaper cut-outs are ideal proofs for this. If all members of the policy holder have passed away and there is more than one person asking for the claim, a court of law settles the dispute.
6. What Do Insurance Companies Do to Help the Survivors/ Nominees?
Four (4) public sector companies, all belonging to non-insurance firms, have come together to form General Insurers (Public Sector) Association (GIPSA). This organization aims to co-ordinate all earthquake related claims that spring up. It makes sure that all the claims that go to the court are genuine. Moreover, LIC has also decided to waive the penal interest for a period of 3 months, in case the policy-holder does not pay the premium on time. Additional help comes towards earthquake affected victims – if they have lost the originals certificates, a fresh one will be issued to them for free. Officers from such insurance firms also survey earthquake affected regions to provide necessary help to people.
7. Can Non-Insured People Claim Benefit from Insurance Companies?
Unfortunately for people who have not applied for earthquake insurance, they cannot claim for compensation from any insurance firm. Such people can, however, get compensation from local and state governments but as a group or whole and not individually.
The government is the primary source of compensation provider in case of all natural calamities. So, if you are thinking of getting earthquake insurance, then do so because your life is in your hands. As there is no surety of life, the only way to preserve it is to plan for its longetivity.
- East Coast earthquake: Are you covered? (insurance.com)
- Earthquake insurance can put you on solid ground (insurance.com)