Claim is by far the most important aspect of any insurance. If there is a lack of proper knowledge and guidance on how to file a claim, the entire process can be incredibly taxing for the policyholder. So, let’s break down how claims happen for Fire and Allied Perils Insurance policies and what are the best practices to follow in the event of a loss.
If you suffer a loss to your insured property due to an insured event, you need to follow certain steps in order to avoid any complications later during the claims process. For all three fire and allied insurance policies, namely, Standard Fire and Special Perils (SFSP), Bharat Laghu Udyam Suraksha (BLUS), and Bharat Sookshma Udyam Suraksha (BSUS), the usual steps to be followed in the claims process are as follows:
First notice of loss / Claim Intimation - As soon as any loss, damage or destruction occurs to your insured property due to an insured event, you must immediately inform your insurer. This is known as the First Notice of Loss (FNOL), and marks the first step in the claims cycle. It usually comes before any formal or official claim, and following this the entire claims process, from surveyor deputation to payout, takes place.
This claim intimation needs to be sent to the claim representative of the broker or the client relationship manager along with a detailed and clear description of the incident.
The following details need to be mentioned in the FNOL report :
- Policy number
- Name of the policyholder
- Details of the event
- A brief statement of the loss
- Details of report to the police or any other authority
- Date and time of loss or damage
- Location of the incident
- Estimated amount of loss
In addition to the above, you should collect and preserve evidence such as photographs of the loss or damage wherever possible. These need to be enclosed in the claim intimation.
Surveyor Deputation - On receiving the claim intimation, the insurance company might depute an external surveyor to inspect & assess the loss. This would depend on the nature of loss & estimated amount of loss. Insurers normally do not depute a surveyor if the estimated loss as confirmed by the client is within their "Self Survey Limit'' However, if the loss is more than that, a surveyor gets appointed.
The policyholder is expected to cooperate with the insurance company’s surveyor in order to ensure smooth processing & finalisation of the claim. The surveyor and the insurance company will then approve (or reject / disallow) the necessary repairs and reconstruction to be carried out on the damaged property.
Please Note: If you’re confused about what a Surveyor does and who appoints such a person, head to our dedicated section for this below.
Final Documentation - Once the survey has been completed and the final repair / restoration work is also finished (on prior consent of the insured), the surveyor makes the Final Survey Report. At this stage, the following documents need to be submitted to the insurance company :
- Final Repair Bill along with the Payment Receipt
- Final Survey Report
On receipt of these documents, the claim gets reviewed internally by the claims team of the insurance company. They may raise a fresh set of requirements if they feel it’s necessary to substantiate the claim better.
Claim Approval & Payment - On reviewing the claim file, if the insurance company’s claims team finds the claim to be genuine and payable, the claim is approved and the claim assessment is sent to the insured for their consent.
Once the insured consents, the claims payment procedure is then initiated. The payment process varies from insurer to insurer and is typically completed within 3 to 4 days of Claim Approval and Consent
The entire Claims procedure can last anywhere from a few days to a few months depending on the size of the claim. Small claims are usually completed within a maximum of 10 days from the date of Claim Intimation since they fall within the “Self Survey Limit”- here no Claims Surveyor is needed to be deputed and the process is quicker.
Bigger claims take a month or sometimes even 2 - 3 months to be completed. This is due to the scale and depth of investigation required for larger claims. If the claim is repudiated by the insurance company and the insured wishes to challenge this decision in a court of law, it can take years before a final judgement is made.
Please note: If you’re a Verak customer, this process is very different! You can make paperless claims using your mobile phone. More on that in the last section.
Immediate notice to authorities - You must immediately report the event to the police, fire department or any other appropriate legal authority. The details and time of this report will be taken into consideration by the insurer during the claims process.
- In case of any damage due to fire, explosion, implosion or lightning, the local fire department must be immediately called.
- In case of land subsidence, landslide or rockslide, the district administration must be informed.
- In the event of impact damage of any kind, or riot, strikes, malicious acts, acts of terrorism, and theft, the police must be duly informed.
- However, some insurers may waive the condition of an immediate report to a legal authority as a determinant during the claims process, if the insurer feels that such reporting was not possible due to extreme hardship experienced by the policyholder or any other person on their behalf.
Steps to prevent further loss or damage - You must take all reasonable steps to minimize the loss or damage to the insured asset. This can include prompt notice/report to legal authorities like the police or fire department, who can come in and assuage the effects of the insured event (be it fire, riots, strikes, or theft). The insurer will also take into account the security steps that were taken before the occurrence of the insured event, which can include establishment of adequate fire control systems, anti-theft devices, etc.
Additionally, you are not allowed to sell, give away or dispose of any damaged property or any items therein without the consent of the insurance company. Also, you should avoid carrying out any repairs, or washing and cleaning of any item, except for an urgent necessity.
Submission of claim - You must submit the claim form to your insurer at the earliest opportunity and within 30 days from the day you first notice the loss or damage. The claim form must be duly filled in with all necessary details. The insurance company will not be liable for any loss or damage after 12 months from the occurrence of the insured event, unless the claims have been filed or are subject to arbitration of pending action.
Establishing loss - In order to prove that the loss/damage was caused due to an insured event, you must present documentation that can support your claim. These documents can include plans, specification books, vouchers, or invoices pertaining to costs incurred for reconstruction/replacement/repairs to the insured property.
Adding to this, you should also assist the insurer and its representatives (surveyors, claims adjusters, etc.) in collecting evidence, taking measurements and samples, taking photographs, and inspecting information mentioned in the business’s books of accounts and relevant records.
To file a Fire Insurance claim, you will need to have the following documents ready:
- Properly filled and signed claim form (every insurer has their own claim form)
- Certified copy of the Insurance policy along with the Schedule and endorsements
- A list of damaged contents or items (usually referred to by insurers as a ‘Claim Bill’)
- Fire Brigade Report
- Photographs of the damaged site and/or goods
- Initial Committee Report, which was composed to investigate the cause of the fire
- Final Investigation Report
- Forensics Report
- Police FIR copy / proof of intimation to Police (in case, the Police is involved)
- Newspaper cuttings/Fire Brigade report/Panchnama (if any)
- Previous claim history (if any)
A Loss Adjuster, also known as a Claims Adjuster or simply Claims Surveyor, is an insurance agent who evaluates the amount of claim to be paid to the insured by the insurance company in the event of a loss or damage. Loss Adjusters come into the picture once a claim has been filed by a policyholder on their insurance policy.
A Loss Adjuster’s primary function is to verify insurance claims and assess the extent of the insurance company’s liability. Loss Adjusters handle property claims involving physical loss or damage to assets as well as liability claims involving third party injuries and the insured’s legal liability. Their functions include :
- Interviewing the policyholder/claimant
- Interviewing witnesses to the claim event
- Inspecting the damaged property / liability event and determining the cost of repairing / the extent of covered loss
- Reviewing Police and Fire Brigade Reports
- Submitting final review to insurance company along with recommended claim amount
A Loss or Claims Adjuster is appointed by the insurance company for the purpose of handling claims. This kind of an official is deputed only when the claim amount as assessed by the insured goes beyond the “Self Survey Limit”.
Filing a claim with Verak is very different from the cumbersome process we’ve detailed above! If you’re our customer, all you need is a few minutes and your mobile phone.
Here’s how it works :
Step 1 : Send ‘Hi’ to the WhatsApp Chatbot or the Web Chatbot to view the main menu
Step 2 : Send ‘4’ to the Chatbot to File a Claim
Step 3 : Enter the number corresponding to the policy that you want to initiate the claim against. A claim request has been opened
If you only have one insurance policy associated with your account, skip to Step 4. Note: In this case, the claims request gets automatically opened for your policy once you complete Step 2. It should look something like this:
Step 4 : Select the type of damage that has occurred
Step 5 : Enter the date and time of the damage
Step 6 : Attach any image(s) or video(s) of the damage. One attachment at a time.
Step 7 : Provide additional details by explaining the incident as a free text response
Keep your claims reference number handy.
At the end, you can select whether you want to return to the main menu, or exit the chat.
Once you have completed all of the above steps, a Claims Executive from Verak will contact you within 2-4 hours.
If all the steps are duly completed, there is NO need for you to intimate the insurance company. That part of the process will be handled by us! In case you get stuck on any step or are unaware about the policy to file a claim on, you can always reach out to one of our agents by clicking on ‘Chat with Agent’. We’ll be happy to help.
Filing for Insurance Claims can be wearisome and intimidating. But once you know the steps you need to take and the documents you need to submit, a large portion of the work is done!
If you’d like to know more about what your Fire Insurance policy covers, head to: Bharat Sookshma Udyam Suraksha Insurance Policy