Industries urged to make “informed decisions”

Industries should make “informed decisions” while going in for insurance products for different risks, according to representatives of the insurance companies.At a meeting organised by the Confederation of Indian Industry here on “Protecting Business from Physical and Export Risk Exposures”, S.V. Mony, Chairman of Chola MS General Insurance, said that in mature markets, industries discussed the quality of the insurance products and the coverage details rather than just the prices.

He spoke on “Emerging Trends in Insurance Industry”. In general, there was a constructed move against any form of intermediaries. However, brokerage houses had an important role to play in developing such discussions. Industries could also constitute a research group to study product adequacy for various risks, he said.G. Srinivasan, Chairman and Managing Director of United India Insurance Company Limited, who spoke on the “Paradigm Shift in the Property Insurance Scenario”, said that paradigm shift had to happen in property insurance that covered fire, industrial and engineering policies. The general insurance industry was affected after September last year and had started growing only from July–August 2009. There were positive signs of revival in many sectors.

New product variations were coming and premium rates were hardening in the property insurance segment. Cross-subsidisation was almost not there. However, customer awareness should improve. Industries should make informed decisions. There was a need to understand the risks exposed to properties insured etc. Risk management would become an important factor soon, he said.

Speaking on “Current Economic Downturn Can Insurance Be Leveraged”, S. Narayanan, Managing Director and Chief Executive Officer of IFFCO Tokio General Insurance, said that industries should look at factors such as the financial strength of the insurance company and ability to deal with claims. May be insurance companies would have to start disclosing the speed at which they settled claims and redressed grievances.

They should move to an era of disclosures and enlightenment so that customers could make informed choices.The industries should look at future capacities and track record of the insurance company when transferring risks, he said.

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