3. INTRODUCTION :
Significance of claims
Delivery of promise
Displays attitude :
You are with insured or take it as a burden
You help at each step or do just postman’s job & leave to
mercy of surveyor and insurance co.
Test of underwriting precautions, add-on covers
Shows competence to service the insurance portfolio
Trust of client in insurer
Faith in the intermediary
Can strengthen or demolish long term relationship
with the insurer and intermediary
Publicity through word of mouth
4. CLAIM PROCESS :
Major stages in life cycle of a claim
Intimation of claim: Policy no., Address, contact, Loss Estimate
Deputation of surveyor by insurance co.
Action for recovery from Carrier / shipping co. for marine part
First visit of surveyor and on-site verifications
Go ahead for further action : dismantle/repair/replacement
Letter of requirements from surveyor (LOR)
Submission of documents, discussions, response to queries of
surveyor, Request for on account payment
Replacement / repair/strengthen, its verification by surveyor
Salvage disposal process : Tender / auction
Assessment, Consent and submission of survey report
Processing by insurance co., addressing their queries
Approval, discharge, NOC, Subrogation (marine), Payment
5. CLAIM PROCESS :
Documentation for SCE/CAR claims
General (List is not exhaustive)
Copy of the written intimation to insurer
Copy of the insurance policy
Occurrence report & Statement of eye witnesses
Segregation Report : damaged and undamaged
items, Extent of damage
Proposal for loss minimization efforts and docs
Profile of the Company
A brief write up about the affected project: date of
start, specifications, bar chart, work completed
before DOL, bills raised to principal, past claims.
Tender document and Bill of quantities (BOQ)
6. CLAIM PROCESS :
Documentation for SCE/CAR claims
General (contd…)
Bills for repairs/ invoice for replacements, wherever
applicable with payment proof
Photographs / Video at different stages
Documentary evidence in support of the amounts
claimed
Copy of the intimation of the loss to Police, Fire
Brigade and any other authority
Fire Brigade report / Meteorological deptt. report (in
case of flood, cyclone etc.)
Daily Diary report / FIR issued by the Police
Photographs, Video, CCTV footage, News paper clips
Duly completed claim form and Claim bill
7. CLAIM PROCESS :
Documentation for SCE/CAR claims
General (contd…)
Test report by the Quality Control personnel
Drawing layout of the Fire hydrant points and fire
fighting equipment
Documents to establish adequacy of insurance : how
sum insured arrived at, total project cost
Purchase invoices of all items above certain amt.
GST, Import duty : Reversal / input credit, exemption
Estimated quantities for salvage items
Offer for salvage value / Docs as per Salvage process
Final Survey report
8. CLAIM PROCESS :
Documentation for SCE/CAR claims
Building
Complete dimensioned layout of the premises
marking the area affected by fire
Structural engineers inspection report along with
results of the tests conducted giving the condition of
affected building and repair methodology
Item wise estimate of the repairs of the damaged
portion of the affected building giving the item name,
qty, rate & amount for the material and labour
BOQ separately for existing (damaged +
Undamaged) and new design, if there is any change
in the design / specifications.
9. CLAIM PROCESS :
Documentation for SCE/CAR claims
P&M and other assets
Layout of the premises marking the installation of
the various machinery
'Single Line Diagram (SLD)' showing the electrical
connections from the main to the end consumer P&M
Service Engineer/OEM's Report with nature of
damage, cause of damage, method of restoration,
estimate of repairs
Estimates/quotations of repairs and replacement
machine-wise with specifications duly supported with
copy of the original procurement invoice
Technical data, specifications, operating parameters
before and after reported failure / damage.
Original purchase invoice, Quote for replacement (if
second hand)
10. CLAIM PROCESS :
Documentation for SCE/CAR claims
Stocks (at site or off-site storage location)
Stock ledger : Received and issued with supporting documents
Itemized purchase ledger for specified period
Purchase invoices, import documents, transportation documents
etc. to substantiate the claimed quantities and value.
Estimate of loss in respect of the damaged stock, along with
cost supporting documents giving costing of each article
(Excluding profit element)
Volumetric analysis of stocks for each type of material : Floor
plan, item name and quantity stored in each area
Details of damaged and undamaged items (Quantities and
value) : items identified as affected / damaged from remains,
items saved
Testing report after the loss with explanation on standard
parameters and deviations in test result
11. CLAIM PROCESS :
Documentation for Marine claim
Recovery Rights
Intimation to carrier / shipping co. and invitation for joint
inspection (within 72 hours) : If loss observed after delivery
Copy of monetary claim lodged on railways/road carriers/postal
authorities/shipping co. within time limit
Postal Acknowledgement for monetary claim lodged (if received
back), otherwise proof of sending the letter by Regd. AD post.
Reply to the monetary claim lodged, if any
Original open delivery / short delivery / Non-delivery Certificate
/ Damage Certificate issued by Carrier (Insured obliged to make
best of efforts to obtain this)
Letter of Subrogation & Special Power of Attorney
12. CLAIM PROCESS :
How to speed up the process
Maintain and provide standard formats to the insured
Take the claim as a project and make someone from client side
as Project in-charge
Joint meeting of all concerned on insured side, earmark and
assign documentations in three categories:
Readily available internally
Can be prepared internally
To be sourced from outside agencies
Assigning of duties to concerned persons : Name, time-line
Mark and Prioritize documents to get “Go ahead” for next
course of action
Review to take updates every week : speak to concerned
persons / assignee directly to clarify his concerns / issues
Discuss and brain-storm difficult areas and decide / ask client to
decide to make the choice out of different options
Scrutinize documents from surveyors and insurer’s perspective
13. CLAIM PROCESS :
How to speed up the process
Don’t hesitate to provide documents to surveyor in piecemeal :
give surveyor opportunity to review documents received
Persistent follow-up with client, surveyor, insurer at least on
weekly basis : Follow-up telephonic discussions by email
Regularly discuss and maintain cordial relations with surveyor
and insurers : Do not create any ego issues on either side.
Correspondence and discussions : polite, does not help to be
offensive. Present differing point of view as academic discussion
Keep legal aspects in mind but never use legal words
Don’t manipulate documents : Surveyors have means to know
through scrutiny.
Presentation : easy to co-relate, qualitative, makes a lot of
difference.
Grey Areas : After informal discussions, present the view point
in a logical and forceful manner.
14. CLAIM PROCESS :
Areas of dispute
Claim not payable / liability is denied
Exclusions : Loss discovered at time of taking inventory, Faulty design
(CAR), Breakage of Glass, Testing done but principle not taken over
Policy coverage : Duration - Loss after testing / 4 weeks of readiness,
Defect liability / extended maintenance cover : link to occurrence before
commissioning
Breach of condition : Delay in intimation, fraudulent means
Fear of damage, fear of liability, breach of regulation, Govt authority action
Claim file closed as NO CLAIM: Non-compliance of requirements
Deduction from claim amount :
To the extent included in S.I. : BOQ, Excise, Freight (expediting cost)
Loss during transit OR during storage / handling / erection
Loss minimization expenses
Burglary/theft in multiple events,
Debris removal : Dismantling expenses, Foreign Debris
Non-standard settlement of claim
Breach of express warranty, Loss of recovery rights in marine
Inordinate Delay in settlement of claim
By surveyor : Busy in other assignments, piecemeal, response time
By insurance co. : Queries in piecemeal, officials on leave/tour/busy
15. Examples of disputes and :
Tips to avoid disputes
Photo / video at different stages (particularly wet risks)
Maintenance Cost sheet, SI working and BOQ of each project
incl material supplied by principals
Second hand machinery : declaration
Cover for site office and its contents
S.I. for Debris removal to cover dismantling expenses, external
/ foreign debris (To check link to percentage of claim amt.)
Reusable scaffolding / shuttering material : CPM
Additional or increased expenses cover as a result of insured
peril (Boulders to be removed to access project site)
Put to use endorsement
Amendment to fire fighting endorsement
Additional duty cover
Stretch warranty for road
Transmission line exclusion by PSU insurers duty to treaty limits
Building in course of construction, items lying in store
Go through and understand tariff endorsements and warranties
16. CLAIM PROCESS :
Case studies
Road and Bridge : Put to use / operation
Flood linked to rainfall data on different dates : multiple excess
Water leakage from overhead tank
Theft by other contractors or their staff working at site
Escalators : Truss, Chinese Engineers
Transformer, Panel, Gilks for Sikkim Govt.
Fire in temporary office
Excise : Centvat credit Original purchase, Repl. purchase
Theft of parts of transmission lines
Storage in open along the long area of project
Electrical cable damaged gradually : Extended maintenance
Fire : absence of fire fighting equipment
Bridge on River : to the extent included in original scope
Natural topography damaged : artificial to be created after loss
Temporary road for diversion after damage, signs / watchman
Cause of damage in Road Bridge slip case