Nokia phones insurance will not erode New India's goodwill: Official
Chennai, March 12 : India's leading non-life insurer New India Assurance Company Ltd is upbeat about offering insurance protection to mobile handsets sold at Nokia retail outlets and is confident that the venture will not result in erosion of its goodwill, said a senior official.
New India and Nokia India have entered into a tie-up whereby mobile phone buyers at the latter's outlets in 10 cities have the option of buying an insurance policy to cover against risks like theft, burglary, accidental damage and others.
"The insurance cover is not bundled with the sale of mobile handset. The handset buyer has an option to buy or not to buy the insurance protection.
"Secondly, we tell the claims procedure and the documents needed upfront so there will not be any impact on our brand image or loss of goodwill," Segar Sampathkumar, general manager at New India told IANS, while declining to share any numbers on expected premium income.
He said the claims formality has been relaxed and the company is not insisting on submission of a first information report (FIR) and non-traceable certificate (NTC) from police if the insured mobile handset is lost due to burglary or theft.
"A claimant has to lodge a police complaint and submit a proof of entry in the diary maintained at the police station. The claimant has to intimate the network service provider and get an acknowledgment from them," Sampathkumar added.
He said New India hopes to settle the claims in five days time and has tied up with Universal Insurance Broker who for Rs.50 will pick-up and drop the handsets for servicing or documents in case of theft/burglary claim.
The premium for the insurance coverage is 1.25 percent of the purchased value of the handset or Rs.50 whichever is higher. The insurance cover is valid for one year.
Not wanting to disclose his name or his company, an official of a private non-life insurer told IANS: "We don't go for such business as it is highly loss making and administering the claim is a headache. For the customers proving the genuiness of the claim is a problem as getting even an acknowledgement from police will be a tough task and ultimately they will blame the insurer."
"Buyers of high and low end customers will not bother to make a claim. This business survives due to lack of awareness. The buyers of mid-segment handsets will not bother to undergo the claim procedure as the deductibles are high," he said.
However, according to Sampathkumar, the excess/deductible (that portion of the claim that the customer has to bear is Rs.300 or five percent of the claim amount which ever is high.
He said the rate of depreciation depends on the age of the equipment. For handsets which of less than three months old, the depreciation is 10 percent, for handsets between three and six months it is 25 percent and for others, it is 50 percent.
To a query whether an insurance broker can earn revenue by managing call centre and offering pick-up and drop services, a former member of Insurance Regulatory and Development Authority (IRDA) told IANS: "The regulations has been recently amended enabling brokers to earn consultancy fee. In this case the revenue can be accounted as consultancy charges."