Natural catastrophe is nothing new to India. Be it floods, landslides, extreme cold or heat, they all have their seasons in India. Many lives are lost every year due to these calamities. Earthquakes and tsunami are rare but equally devastating. Its been nearly 6 years since tsunami struck us and still individual natural catastrophe covers have not yet evolved in India.
There is a strong need to insure individual property and its contents. India is yet to see a standalone insurance product for natural disasters. IRDA is now studying CAT insurance solutions to insure an individual against such natural acts of destruction. In response to this, Mr. Narayan, chairman, IRDA, mentioned that the government at present provides the bulk of financial aid through budgeted funds, which are largely given for restoration of public buildings, humanitarian relief and writing off of crop loans. Loss of individual family assets is not taken care of.
He suggested that mandating lenders to take out catastrophe insurance, irrespective of the location of the properties on which they have loaned money, was one way of increasing cover against disasters.
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