Mumbai hotel insurers remain largely unscathed

Chennai: The bottom lines of insurance companies who insured the hotels attacked during the siege of Mumbai, will not be affected by property damage claims as the loss will be met from a terrorism risk pool, managed by the state-run General Insurance Corp of India (GIC), say industry officials.

The claims for property damage as well as loss of profit will be met from the Rs7.5-billion (Dh555 million) pool, they say.

Insurers who issued public liability policies to the three hotels targeted by the terrorists, and provided personal accident policies to employees with the risk of terrorism extension, may face sizeable claims from next-of-kin of those killed and injured during the seige.

"Our liability policy covering the Trident-Oberoi hotel covers damage owing to acts of terrorism," United India Insurance general manager A. Asthana said.

The overall liability is around Rs100 million and the risk is reinsured. The maximum net impact on the company will be around Rs50 million, Asthana said.

Sitting comfortably among the insurers of the terrorist attacked hotels is the Mumbai-based New India Assurance which insured only the Trident-Oberoi hotel properties.

Since the property damages will be met from the terrorism pool, New India will remain unscathed.

Long time Taj Mahal Hotel and employee insurer, New India, this year escaped as the account was bagged by three private insurers.

According to industry officials, it will take at least two weeks for the insurance surveyors to assess the actual financial damage as investigating authorities have first to complete their job.