General Insurance Corporation Re set to reel under loss in Nepal over earthquake claims

MUMBAI: State-owned reinsurer GIC Re will bear the brunt of the Nepal earthquake that has caused widespread damage to industrial and commercial property. "We are the largest international reinsurer in the Nepal market and we have sent a team of 10 surveyors to assess the loss," said AK Roy, chairman and managing director GIC Re, which accounts for about a quarter of the total insurance in the Himalayan country.

Roy added, "We will have loss estimate in the next two-three days. We have kept surveyors as the backup." The Insurance Regulatory Authority of Nepal or Beema Samiti requires companies to cede 50% of insurance within the country.

A massive earthquake measured at 7.9 on the Richter scale rocked Nepal on Saturday, followed by another one measuring 6.7 on the following day, im-pacting some parts of India as well.

The worst earthquake to hit the region in 80 years brought down several buildings and centuries old temples. While the quantum of insured loss due to destruction is yet to be assessed, claims will come from home insurance policy that provides cover for any damage to the property and contents due to natural or man-made calamities including earthquake.

Rates depend on the area and the frequency. There are four seismic zones – Zone I, Zone II, Zone III and Zone IV. Private sector insurer Bajaj Allianz General Insurance came out with a dedicated helpline number for victims of the earthquake that struck northern and eastern parts of the country.

A special team has been formed in the company to handle these cases and it will make efforts to settle claims on priority. State-run insurer Life Insurance Corporation of India is also set to be hit by claims from the earthquake.