PSU insurers for quick disbursal of third party motor insurance claims

PSU insurance companies — National Insurance, New India Assurance, Oriental Insurance and United India Insurance — have recently set up a common mechanism for settlement of motor third party claims in Kolkata.

The common mechanism will seek a faster redress of third party motor claims on a mutual basis between the insurance companies and accident victims and their kin.

The four PSUs underwrite nearly 70 per cent of the third party motor claims in the Indian market.

Third party motor claims refer to the claims of compensation for injury or death of the driver or passengers in a vehicle, in case it meets with an accident. Various findings have shown that about 10 per cent of fatal road accidents worldwide are in India.

According to Mr C.P.R. Varma, General Manager, National Insurance Company, a similar pilot project initiated in Cuttack (Odisha) has been successful. The Cuttack centre has disbursed claims worth nearly Rs 9 crore within a year, he said, speaking on the sidelines of the launch of the Kolkata centre on Saturday.

Other than Kolkata, there are four other such common mechanism centres in the eastern region – one each in Guwahati, Cuttack, Rourkela and Bhubaneshwar. Currently, there are 20 such centres operating across the country.

“We plan to set up three more centres in Bengal; and a total of nine centres in the eastern region by March. Plans are afoot to take the number centres to 50 by March next year,” Mr Varma added.

According to Mr Varma, the centres will help disburse pending third party motor claims mutually thereby, reducing dependence on Lok Adalats.

At present, there are over 10 lakh pending third party motor claims between the four PSU insurance companies. Typically, disposing off a third party claim varies between four and five years following a protracted legal procedure.