A committee headed by PJ Joseph, member(non-life), IRDAI, has deliberated on the prospects, challenges, risks and opportunities with regard to a proposal from Indian Institute of Insurance Surveyors and Loss Assessors (IIISLA) to accord itself the status of a chartered institute.
The panel, comprising representatives from Insurance companies, Surveyors, IIISLA and nominated members of IRDAI and the Government among other things has recommended that membership must be issued to every eligible applicant/existing surveyor who comply with statutory requirements. The existing provisions of articles of association (AOA) were drafted when the membership was not mandatory and now, in keeping with the statutory requirements of the present legal framework, it must be amended, immediately.
There are full 1762 fleged surveyors including 31 corporate bodies and 1291 trainee enrolments in the industry as on Mach 31,2018. Some 294 new surveyors have joined the industry in 2017-18.
Moreover, IIISLA Council has to be made more diverse with inclusion of members from varied domains and expertise areas, suugested the Joseph Panel. .
IIISLA will define a framework of technical qualifications and examinations at par with global standards and only when it has established such a framework.It can regulate the profession of surveyors and loss assessors as a self- regulatory body on the lines of ICAI, ICSI etc. IIISLA may draw necessary technical know-how from similar bodies such as The Chartered Institute of Loss Adjusters, London (CILA) and then develop a roadmap for this endeavour, explained the Joseph panel.
The panel wants that IIISLA must set up a Research and Training Wing – for carrying out research and bringing out academic publications, both for Motor and Non-Motor technical areas in loss control and minimization techniques and measures. There is a need to promote the efficiency and usefulness of the profession of loss adjuster by having in place high standards of research and education
IIISLA will be able to carry out its functions effectively only when it has proper governance structures in place. There is a need to work with all the members of the institute in a coherent manner to design a well-laid governance system to carry out the objects of its present AOA and gain credibility, essentially required for the institute as well as for the profession of survey and loss assessment.
IIISLA must ensure that adequate internal controls and systems are in place, including proper maintenance of books of accounts and records, appropriate structure of operations and the appointment of an executive officer, independent of office bearers. The accountability of the office bearers may be demonstrated through appropriate penal action. For instance, if it is found that there is involvement of office bearers in any of the lapses identified, suitable action may be taken against them including ineligibility to contest the elections atleast for a period of three years and so on, said the panel .
IIISLA must submit a roadmap within 30 days of release of the Joesph panel report indicating actionable points for implementation on the above and this has to be implemented within a period of six months from the date of release of this report.
The progress and compliance report should be submitted to IRDAI on a monthly basis. After six months, a comprehensive compliance audit report on the functioning of IIISLA should be furnished to IRDAI and Ministry of Finance, indicating the status and extent of compliance of the above requirements.
According to the report, on average, after excluding Health insurance segment, , Motor OD (own damage) claims form 32% of total claims paid in terms of numbers and 31% of total claims paid in terms of amounts. The losses reported by the insured beyond the stipulated limits (Rs. 50,000/- in cases of motor and Rs 1,00,000/- in case of other than motor segments) need to be surveyed and assessed for timely settlement of claim and the licensed surveyors and loss assessors (SLAs) are appointed by insurers for this purpose.
Based on the claims paid data received from Indian Insurance Bureau(IIB) for the last two years, in terms of claim numbers,Motor-claims above Rs. 50,000/- constitute more than 95% of the total claims that have to be surveyed and assessed as per the limits.• In terms of claims paid value, Motor claims exceeding Rs. 50,000/- represents almost 68% of the total claims paid value. Majority of the Property-claims are handled by Corporate Surveyors.
The total amount of claims paid (excluding health segment) has grown by 5.6% and 16.7% over the last two years. The growing volumes of non-life business and the increasing number of claims demand existence of qualified professional surveyors to examine, measure, assess the losses and report to insurers for speedy settlement of claims.