Insurance council issues advisory against false claims experts

The general insurance council, which represents the interests of all non-life insurers and reinsurers in India, has issued a public advisory against insurance experts who are making false promises during the COVID-19 pandemic.

The council said that some people claiming to be ‘insurance experts’ in the guise of advisers, consultants and legal experts are advising policyholders to lodge claims with insurers for losses arising from the COVID-19 lockdown under various insurance policies such as loss of profits, business interruption policies and industrial all risk policies issued to industrial establishments, shops, hotels, offices and offering their services to get claims settled under such policies.

The advisory mentions that any claims under these policies can only be triggered only if the claim is admissible under the material damage condition. The council has requested the general public to stay safe during this period and to contact their insurance company directly for any support and in case of any claim. “Policyholders are advised not to get carried away by the false promises/ suggestions of such entities, that ‘business interruption losses’ arising out of COVID-19 shut down are admissible," the advisory said.

The advisory also stated that persons claiming to be acting as insurance consultants are violating the provisions of Section 42D (8) of the Insurance Act 1938. Further it also stated that any registered entity of the IRDAI who deals with such persons will also become liable under the provisions of Section 42D (9) of the Insurance Act 1938.