Insurance firms plan repositories to prevent claims fraud

New Delhi: To avoid fraud in the government’s recently launched social security schemes, providing

life and accident insurance cover to a majority of Indians, insurance companies are looking to set up a claim repository. The measure is aimed at preventing individuals from filing multiple claims, said insurance industry officials.

Finance minister Arun Jaitley announced the launch of the Pradhan Mantri Suraksha Bima Yojana (PMSBY) and the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) to provide accidental death and disability cover and life insurance cover, respectively, in this year’s budget speech.

The schemes were subsequently launched by Prime Minister Narendra Modi.

In just over a month since the launch, more than 100 million people have enrolled themselves in these schemes, according to data available with the government.

Insurance companies are bracing for multiple claims, fearing that the low and subsidized premiums may encourage individual policyholders to apply for several policies through multiple bank accounts held by them.

“The general insurance council will set up the claim repository for PMSBY and the life insurance council will set up the claim repository for PMJJBY,” said the chairman and managing director of a state-run general insurance company who did not want to be identified.

Another insurance industry official said that various options are being considered for “de-duplication”.

“Once the claims start coming in and increase, we need to see how to ensure that claim de-duplication is done,” said the insurance industry official who also did not want to be named.

People in the age group of 18-70 years having a bank account are eligible to get a policy under PMSBY.

Under this scheme, accidental death and full disability cover of Rs.2 lakh and partial disability cover of Rs.1 lakh is available at an annual premium of Rs.12.

The scheme is mainly being implemented by government-run general insurance companies.

PMJJBY, currently being offered by the Life Insurance Corporation of India, is available to people in the age group of 18 to 50 years. The scheme offers a life cover of Rs.2 lakh for an annual premium of Rs.330.

In both these schemes, the main criterion is that the policyholder should have a bank account linked with Aadhaar, with the premium auto-debited from the bank account.

“Many insurance schemes have been announced in the past few years by the government, but they remain only on paper. No implementation agency has so far managed to contact a large number of villages and convince people to subscribe to these schemes,” said N.C. Saxena, former member of the National Advisory Council.

“These schemes will also remain only on paper and will soon be forgotten,” he added.

Which Cars Have the Cheapest Auto Insurance Rates?

When buying cars, people often only consider the sticker price, but insurance can impact your wallet, too. Try to get a price quote from any insurance company, and you’ll discover that your location, coverage level and personal driving record are just a few of the other factors that affect how much you pay. Auto insurance premiums are partially based on the year, make, model and features of the vehicle. If you’re looking for cheap car insurance, buy a vehicle model with strong safety features and a low risk for damage claims.

How car models influence insurance

What vehicle you drive significantly affects insurance costs. Experts say the cheapest insurance rates belong to crossover SUVs and minivans, and the most expensive belong to high-dollar sports cars. Insurers factor in safety testing data, sticker prices, theft risks and bodily injury claims when formulating your rates. They also compare insurance claim histories of different makes and models to see which cause and receive the most damage in traffic accidents.
The Insurance Institute for Highway Safety and the National Highway Traffic Safety Administration test new auto models every year in labs and on controlled track courses to see how well they’ll hold up in an assortment of accidents. Crash-test dummies ride along as drivers and passengers in simulation after simulation. These results also factor into your insurance rate.

Crash test data

According to IIHS experts, the mini class has the poorest performance in crash tests. Injury risk is high because the smaller and lighter vehicle’s structure collapses in at least three different impacts. The next size up, the small car, rated higher in testing. The IIHS also says that who is driving the vehicles affects the number of collision insurance claims. In other words, parents with children in the car tend to be very careful drivers.

SUVs, pickups fare best

According to the most recent data available from the IIHS in a comparison of all vehicles, the two-door 4-wheel-drive Jeep Wrangler with a short wheelbase had the lowest overall frequency and insurance losses due to collision between 2011 and 2013. At 49% better than average, it’s the only one in the small SUV class to make the top 10 list. Right behind it is the midsize SUV four-door Jeep Wrangler. Of the remaining eight, six are large or very large pickup trucks. The Smart For Two convertible is the only automobile in the group, representing the micro two-doors class. The Chevrolet four-door 4-wheel-drive Suburban 2500, considered a very large SUV, tied with four of the trucks at 39% better than average.

Sports and luxury vehicles rank worst

The two-door Ferrari 458 Italia claims the highest overall frequency and losses between 2011 and 2013, coming in at 446% worse than average. The 10 highest percentage of losses on the IIHS list all belong to sports cars and luxury automobiles, with the exception of the seventh-place midsize luxury SUV, the BMW four-door 4-wheel-drive X6 M at 280% worse than the average vehicle.

Choosing cheaper car insurance

Just how much of a difference is there in auto insurance among the different types of car classes? Our Nerds did a test to find out using our auto insurance comparison tool. As a control number, we used the 2012 model for each vehicle. The driver is a hypothetical 35 year-old man in San Francisco, California, with a clean driving record who’s been insured for 19 years and owns his vehicle.
Here’s a sampling of monthly auto insurance rate estimates:

Vehicle Class       Make and Model                         Insurance Cost Range

Subcompact car	Honda Fit	$97	$186
Luxury sports car	Ferrari 612 Scaglietti	$577	$811
Mid-size sedan	Nissan Altima 2.5	$104	$210
Luxury sedan	Lincoln MKS	$120	$244
Mid-size SUV	Jeep Wrangler two-door	$79	$192
Large SUV	Chevy Suburban 2500	$84	$107
Luxury SUV	BMW X6 M	$156	$411

If you’re trying to save on monthly expenses, choose your vehicles carefully. You can spend less on car insurance when you purchase a safer vehicle without the high price tag.

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