Page 11 - The Insurance Times July 2025

grant labourers in Noida when tem- drive up freight costs and insurance Two Crore End-of-Life Ve-
peratures exceeded 42°C, marking its premiums, especially for Indian busi-
first payout under a heat-index-based nesses reliant on global trade. While hicles Need Urgent Policy
parametric policy. This initiative, span- the Iran-Israel conflict has so far had Backing: SIAM
ning six cities, is in partnership with K limited direct impact, Brent crude The Society of Indian Automobile
M Dastur Reinsurance Brokers and Jan prices have risen to $73-76 per barrel- Manufacturers (SIAM) has called for
Sahas Foundation. higher than the April-May average of
urgent policy support to manage over
Bajaj Allianz General Insurance also $65-raising concerns over future en- two crore vehicles in India nearing the
reported payouts ranging from Rs 500 ergy price spikes. end of their operational life. At a World
to Rs 2,000 for early monsoon condi- Should hostilities escalate or energy Environment Day event, SIAM Presi-
tions under its "Climate Safe" product, supply chains be disrupted, Indian cor- dent Shailesh Chandra emphasized the
which covers 200 cities. These policies porate profitability may suffer, Crisil need for a circular economy driven by
compensate for climate-induced in- cautioned. While upstream oil firms three pillars: policies promoting bio-
come loss due to extreme weather stand to gain from higher prices, down- based materials, incentives for scrap-
conditions like heatwaves and exces- stream refiners may face margin pres- ping old vehicles, and enhanced recy-
sive rainfall. Despite low public aware- sures due to rising input costs. Export- cling infrastructure.
ness, insurers expect increased de- and import-based industries could also Chandra urged the government to
mand as climate risks intensify. Para- see increased air/sea freight charges implement a robust policy framework
metric policies are gaining traction and marine insurance rates. that pushes OEMs to adopt sustainable
across sectors such as agriculture, gig However, Yes Securities noted that de- materials and efficient lifecycle man-
economy, and event management. spite past geopolitical tensions, Iran has agement. He also recommended fi-
historically refrained from closing the nancial incentives to encourage own-
West Asia Uncertainty Strait of Hormuz-critical for global oil ers to scrap vehicles via Registered

May Push Freight, Insur- transit-due to economic and strategic re- Vehicle Scrapping Facilities (RVSFs),
percussions. The presence of U.S. naval supported by awareness campaigns.
ance Costs Higher: Crisil forces continues to act as a deterrent, As of January, 125 RVSFs have been
Crisil Ratings has warned that pro- but risks remain elevated in a region approved, with 65 operational, along-
longed instability in West Asia could central to global energy dynamics. side 162 automated testing stations, of
which 23 are functional. The Environ-
ment Protection (End-of-Life Vehicles)
Govt Plans SOP for Faster Insurance Claim Settle- Rules, 2025, mandate OEMs to meet

ment Post-Air India Crash scrapping targets under extended pro-
ducer responsibility. Additional tax con-
In the wake of the tragic Air India plane crash, the Union finance ministry
cessions and OEM-led purchase dis-
is considering the creation of a formal Standard Operating Procedure (SOP) counts aim to incentivize sustainable
to expedite insurance claim settlements in mass casualty scenarios.
scrapping practices as India moves to-
Sources said the ministry may soon convene a meeting with insurers to draft ward a cleaner mobility future.
a roadmap ensuring swift and coordinated response mechanisms. A senior
official confirmed that the Insurance Regulatory and Development Author-
ity of India (IRDAI) has been asked to instruct insurers to prioritise claims Join
linked to the recent crash. The proposed SOP will outline procedures for
identifying claimants and managing settlements for two primary catego- Online Certificate
ries: individuals with personal life insurance and those covered under air-
line-provided group insurance. Course on
Insurers have also been directed to set up dedicated helpdesks and main-
tain separate claimant lists to streamline processing. "We need to prepare Motor Insurance
our insurance industry for uncertain times," the official said, indicating a
broader effort to build systemic readiness for future incidents. An official For details please visit
response from the ministry was still awaited at press time. www.smartonlinecourse.co.in

10 July 2025 The Insurance Times