According to and other top sites covering Insurance market in India, there are over 2 crore claims coming every year in the Motor Insurance Industry. As per insurance norms, there needs to be a survey inspection for all claims above Rs. 20,000/- . The survey is done by Surveyors, who are paid by the insurers for conducting the survey.

So there are 4 parties or stakeholders during any Insurance claims processing that is above Rs. 20,000/- . First is the customer himself, second is the authorised service centre of the manufacturer of vehicle, third stakeholder is the insurer who has to pay the money for insured vehicle, and fourth stakeholder is the surveyor who has to judge whether the vehicle is entitled for insurance reimbursement, and if so , by how much. In a way, Surveyors helps customers by keeping the service centre estimates in check, and ensuring that insurance provider pays for the expense as per norms.

The flaw in this process is that there is a shortage of trained Insurance surveyors. As per some estimates, there are only 11,000 surveyors who are available to the insurance agencies to process these claims. This , coupled with the rising number of middle to high segment cars, have lead to a bottleneck in motor vehicle insurance processing. The number of claims greater than Rs. 20,000 has been increasing , with the rise in number of vehicles on the road. Hence, there are times when the cars or vehicles cannot be serviced in time, and customer are kept waiting till the surveyors reaches and examines the vehicle.

Imagine what happens when such bottlenecks are coupled with natural disasters, like floods. Such was the case in Jammu & Kashmir and then Uttarakhand. The situation could have been very painful. Thankfully IRDA approved a temporary relaxation in norms and lifted this Rs. 20,000/- criteria in these areas for some time. Customer were able to gets their damaged vehicles serviced and claimed insurance in time.

What is the present debate focused upon:

After this pilot, the insurance companies and their lobby is pushing for structural reforms in this process. They are suggesting that the criteria of Rs. 20,000/- plus be changed to Rs. 50,000/- plus (in some cases, upto Rs. 1 lac) . This is suggested to make sufficient bandwidth for an estimated 2 lacs claims per year. We also have to keep in mind that with an average claim amount of Rs. 30,000/- there is a high cost factor (in % terms) impacting the insurance agencies. Hence, this change , if implemented would also help Insurance companies make more money !

Now the insurance lobby is pushing IRDA to change the mandatory survey amount from Rs. 20,000/- to Rs. 50,000/- or in some cases, upto a lac. The reason being cited is that there are over 2 crore claims every years, and the number of qualified surveyors are less to fulfil their needs.

Another explanation for this is that with an average ticket size of Rs. 30,000/-, the cost of conducting these surveys is hitting the insurance company hard. Do keep in mind that the motor insurance industry is not making much money in india.

Possible Impact:

If implemented, there are positive as well as negative possible outcomes for the customers. While they might see a speedy repair and claim handling of their less than 50,000/- claims, it might also result in insurance companies rejecting portions of their claims, as they (insurance companies) will be the deciding authority. (there will be internal surveyors for these category of claims). Having said that, there are provisions for grievance redressal in case this happens.

Surveyors will be impacted the most in this. From being highly sought and getting paid well, the demand supply equation will tilt way from them, since majority of the cases are settled under Rs. 30,000/-

Things are still undecided as of now, and all the stakeholder are keenly watching this development. To keep yourself informed of all insurance related news and to get a good price for your next insurance need, visit

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