In every disaster lies an opportunity, seems to be the motto of insurance companies in the time of terror attacks. Insurance companies and broking firms are now seriously planning to enter the largely under-insured sector of exclusive terror insurance cover for individuals. New India Insurance company has tied up with click2insure.com , an online insurance broking firm, and is providing free terrorism insurance cover up to Rs 1 lakh to one lakh policy holders on a promotional basis. "Our online site has already got around 5,000 registrations in the last two months. We're getting overwhelming response, especially after the Ahmedabad blast," Rahul Agarwal, CEO of Delhi-based click2insure.com , said. The broking firm hit upon this concept after the Jaipur blasts, when reports that hundreds of people who were injured had to wait for weeks together for compensation to arrive from the government. "We have been getting a great response from cities like Mumbai, Bangalore and Hyderabad as the threat perception levels there have gone up tremendously," Agarwal said. Insurance companies normally provide comprehensive fire policy cover for households and commercial establishments which also include cover for terror attacks. 'Huge market for terror insurance' "As of now, insurance firms do not provide exclusive terrorism insurance cover for individuals as a stand-alone policy. This is part of the inbuilt personal accident policy cover for most life insurance firms. But we are planning to propagate this terrorism insurance policy cover as there is a huge market for this," Rahul Agarwal, CEO of Delhi-based click2insure.com , said. Says Neelkant Jain, who has a jewellery showroom at Mumbai's Zaveri Bazaar, "I asked all my employees to take this cover after hearing about the Ahmedabad blast. These days everything in life is so uncertain and anything can happen to anyone," Jain said. New India Assurance executives said that the insurance broking firm will be paying the premium to the insurance firm, though the initial one lakh policy holders will be getting it free of cost. "For the terror insurance cover, we will be charging an annual premium of Rs 18 per lakh. We have kept the premium very low as the claim ratio will be very less as compared with personal accident cover," said B S Baga divisional manager, New India Assurance.
The insurance companies had a few years ago come together to set up a common terrorism pool to offset huge losses due to insurance claims on property damaged by terror attack. "But for individual compensation, there is no such common pool and the insurance company will have pay the compensation from its kitty," Baga said. Meanwhile, the funds collected from the premium on terrorism cover have swelled from Rs 250 crore to Rs 450 crore in the last three years. "The common terrorism pool has over Rs 1,000 crore and is set to touch the Rs 2,000 crore marks. This shows that people do anticipate terror attacks," an insurance official said.
Source: The Times of India
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