Page 49 - Insurance Times March 2021

LEGAL

Vehicle Insurance

Insurers did not follow 20% orders of Film insurance rebounds after
ombudsman pandemic hit
Justice for insurance claimants takes a long time coming
ever after winning an award from the ombudsman. A Mega claims following movie production cancellations and
response to an activist's query under the Right to delay in releases last year have burnt insurance companies.
Information (RTI) Act has shown that one in five awards But a renewed demand for film insurance could see the
announced by the insurance ombudsmen was pending at industry's annual premiums grow from the current Rs 150-
the end of FY20. 200 crore to around Rs 300 crore. "We are getting almost
two proposals a day. There is a huge number of productions
IRDAI has said that it has not taken any disciplinary action that are taking the floor in Hindi, Tamil and Telugu, including
against any insurance company so far for not complying from over-the-top (OTT) platforms," said Aatur Thakkar,
with the order of the ombudsman. The RTI query was filed director of Alliance Insurance Brokers, which arranges for
by Jeetendra Ghadge, who took an interest in the matter a large chunk of the films to be insured in India. After
after his own experience with the ombudsman. He taking a beating last year on account of mega event
managed to get his order implemented within two months cancellations like Wimbledon in the UK and the Olympics
with help from the ombudsman's office, but was surprised in Japan, event insurers globally have got badly burnt.
to see how lightly insurers were treating the orders. Additionally, the pandemic became an excluded risk
immediately after the World Health Organization's
According to the response, 9,528 awards were issued by
various ombudsmen across the country against insurance announcement on March 11, 2020.
companies in the previous financial year. Of this, insurers "While risks arising out of Covid are excluded from
had complied with 7,664 orders, but 1,864 were pending insurance treaties, it is possible to get specialised covers
at the end of the year. Public sector insurers Oriental, New from global underwriters under facultative
India and National Insurance had the highest number of programmes," said Thakkar. Facultative reinsurance
pending orders at 480, 303 and 289, followed by Bharti Axa covers provide for a case-to-case acceptance unlike
Life at 198 and Star Health at 142. reinsurance treaties where there is a blanket acceptance
of all proposals underwritten by a primary insurer in a
IRDAI has said that it has not acted against any insurer so
year.
far for delay in implementation. According to Vinay Sah,
ombudsman for Maharashtra excluding Mumbai, there are "We arranged a Rs 140-crore insurance cover for Akshay
instances when insurance companies take more than a Kumar-starrer 'Bell Bottoms', the first film in India and
probably worldwide to go on the floors after the
couple of months. His orders now incorporate a condition
pandemic," said Thakkar. The movie, produced by Vashu
that the award is to be complied with within one month,
failing which interest will be applicable at bank rate plus Bhagnani, was shot in a bubble - a term used to describe
2% from the date of original rejection of the claim until a situation where interaction is limited to a small cluster
of people in a group.
payment.
The Insurance Times, March 2021 49