Preliminary estimate of 5th December devastation out of Cyclone Michaung in Tamil Nadu indicate the economic losses of around Rs 12,000 crore for the state and insured losses limited between Rs 1,500 crore to Rs 2000 crore
With all its fury and devastation, both economic losses as well as insurance losses out of the last week’s Chennai floods due to Cyclone Michaung will be much less than what a similar natural catastrophe had caused to the city in 2015.
Back in 2015,Chennai floods had saddled the city with around Rs 20,000 crore of economic losses and Rs 5,000 crore insured losses.
Preliminary estimate of 5th December devastation out of Cyclone Michaung in Tamil Nadu indicate the economic losses of around Rs 12,000 crore for the state and insured losses limited to Rs 1,500 crore Rs 2000 crore.
The cyclone triggered torrential rainfall in several parts of Tamil Nadu since December 5 claimed the lives of at least 14 persons, most of them in Chennai. It made landfall in neighbouring Andhra Pradesh on December 6
“This time, we are not expecting insured losses like last time,’’ said a senior official of GIC Re.
The state government says, in all, 4,800 MSME units in 24 industrial estates in Chennai, Tiruvallur, Kanchipuram, and Chengalpattu districts have been affected due to excessive rains and subsequent floods.
The affected MSMEs supply components and other materials to sectors like automobiles, electronics, and chemical manufacturing and medical devices.
Tamil Nadu finance Minister Thangam Thennarasu has advised insurance companies to settle auto claims expeditiously.
Attending a meeting on the last Friday convened by the minister, representatives of 13 firms said so far claims for compensation for 600 two-wheelers, 1,275 four-wheelers, and 445 commercial vehicles have been received.
He also asked the insurers to simplify the procedures for getting insurance claims for vehicles and to create awareness of getting insurance claims among people.
T M Anbarasan,Tamil Nadu MSME minister, is planning to meet representatives from insurance companies this week to ask them to speed up the process of assessing the losses and evaluating the claims without any delay.
“While the task of estimating expected claims and assessing the economic impact remains complex at this early stage, our immediate priority is to reach out and alleviate any inconvenience our customers may be facing, said a senior Official from the Claims Team at TATA AIG General Insurance.
“The Chennai floods have caused immutable loss of property and lives, creating a mode of panic and uncertainty among the general public. The floods have had a severe impact on connectivity be it mobile networks or transportation, and so, we have not been intimated on claims so far as rescue efforts are still on. In areas where the water has receded, we will be directing our teams to approach policyholders to evaluate claims and collect all the necessary documents,’’ Casparus Kromhout, MD & CEO of Shriram Life Insurance Company said adding that as of yet, the company has not received any claims, as the search and rescue is still going on in the affected area.
K. E. Raghunathan, national President of Association of Indian Entrepreneurs, a Chennai-based MSME body, in a statement said the economic losses due to the heavy rains triggered by Cyclone Michaung hitting Chennai and neighbouring districts, is expected to be over Rs.11,000 crores.
The local manufacturing units of leading global companies including Daimler, Hyundai Motor and Taiwan’s Foxconn and Pegatron, that makes products of tech behemoth Apple, are located around Chennai and had experienced disruptions in their operations
However, a few of the companies could resume production in 48 hours while a few are yet to do that.
Besides, Raghunathan has informed that over 25 lakh persons involved in the MSME sector, along with those working as street vendors, gig workers, auto and taxi drivers, daily wage earners, contractors, perishable goods sellers and traders have been affected by the flooding.
The maximum loss was expected in Kanchipuram, Tiruvallur, Chennai and Chengalpattu districts, which account for more than 3.5 lakh industries, said Raghunathan.
Majority of the 2,100-odd units in Vichur, Ambattur (north phase), Perungudi, Thirumazhisai, Thirumudivakkam, and Villivakkam industrial estates were flooded days after the storm receded with water reaching their shop floor, damaging machines, finished goods, and raw materials.
Anticipating a surge in motor vehicle claims due to the flooding situation in Chennai and nearby areas, at Tata AIG, our customer service department is ready to address all inbound queries since the first day of the flooding situation, said an official of Tata Aig General Insurance.
“Our motor insurance policies include a variety of features and add-ons that have been designed to effectively handle issues arising from flooding. Notable among these are Engine Secure, Return to Invoice, EMI Protector, and Nil Depreciation – each tailored to offer specific additional benefits during such challenging circumstances,’’ he said.
“To our customers, we would recommend that they do not start their vehicles, but instead arrange for towing of the vehicle to a workshop. We would also suggest that policyholders do not delay claim intimation to us. To facilitate the reimbursement process for claims, we advise our customers to contact us at our toll-free number (1800266 7780) and email their claims requests to firstname.lastname@example.org, use our website (https://www.tataaig.com/claims-process) or reach out to our TATA AIG Insurance advisors,’’ he said.
Meanwhile, insurance regulator IRDAI has said all Insurance companies are advised to mobilise all resources to ensure immediate service response including outsourced functions such as Surveyors, Loss Adjustors and Investigators, to quickly settle claims out of Chennai floods.
The IRDA has asked the insurers to specifically a nominat a senior executive to act as the Nodal Claims Officer overseeing the claims response.
The Nodal Officer appointment should be communicated to the chief secretary concerned of the state immediately, said the IRDAI.