Courier firms make false insurance claims: IRDA

IRDA has recently cautioned public that claims of insurance cover made by courier companies are false, as these firms do not have the permission or authority to offer insurance cover. The insurance regulator has stated clearly that few entities under the banner of cargo carrier, couriers/ logistic providers/ freight forwarders/ transporters or involved in similar trade are charging consideration from their clientele towards the liabilities, using the terminology ‘insurance’, thus creating an impression that they are either insurance entities or arranging insurance on behalf of their clientele. “These companies are illegally charging extra amounts against the insurance cover promise,” said an IRDA member. In a recent notice IRDA has clarified that an entity can function as an insurer or an insurance intermediary only after obtaining a licence or certificate of registration from the IRDA under the relevant provisions of the Insurance Act, 1938 and the IRDA Act, 1999 for carrying on such business. The IRDA has also stated that only a licensed entity by the authority can offer an insurance product and collect or charge insurance premium towards consideration. “The general public is also advised to check the veracity of the entity as well as the insurance arrangement promised, before making any payment towards insurance premium consideration,” the public notice issued by IRDA said.