Schengen blacklists 14 Indian insurance companies
19 Mar, 2014 01:01 PM
 
Travel and medical cover issued by these companies, including National Insurance and SBI Life, will now be invalid in the 25 European countries bound by the Schengen agreement. 11 insurers figure in the list of approved.

Indians travelling to Europe will now have fewer options to insure their journey. The Schengen visa authority has blacklisted 14 Indian insurers, including National Insurance and SBI Life, for various inefficiencies.

Henceforth, travel and medical insurance issued by these companies will not be valid in Schengen countries. The Schengen authority issues common visas to 25 countries.

The debarred companies also include top private players like ICICI Lombard, Bharti Axa, L&T General Insurance, Religare Health Insurance and Raheja QBE.

The authority approves 14 companies and instructs travellers to take insurance only from these companies.

"Visa applicants are advised to note that travel and medical cover by other Indian insurance companies are not accepted for Schengen visa procedure," said the authority.

For insurance companies, this is bad news as it comes right ahead of the busy April-May season for travel insurance sales. That Europe attracts maximum Indian tourists during summer also adds to their woes.

Student travel, too, is high during the period. Insurance industry insiders say the visa authority took this step as the rejected insurers do not measure up to their standards.

"The reasons for rejection include high claim repudiation, inadequate service and IT infrastructure. They do not comply with embassy norms," said a top official of an insurance company.

None of the insurance companies, except ICICI Lombard, responded to e-mail queries.

"Our travel insurance products are compliant with all embassy requirements. Problem pertains to an IT-related upgrade... the same has been done and communicated to the authorities," said an ICICI Lombard official.

Insurance Regulatory and Development Authority (IRDA), too, did not respond to queries.

Travel insurance accounts for 4% of the total premium of general insurance companies. Rejection by a top authority could have damaging effects on the reputation of these companies, experts say.

Most insurance companies have many claims-related complaints pending against them and a majority of them relate to mis-selling. Though IRDA has started a grievance redressal system, it is yet to take off.

An industry analyst, however, said that the Schengen authority cannot be blamed.

"Many Indian companies don't take policyholders seriously. They don't provide appropriate services during emergencies. Travel insurance needs a helping hand in other countries. Foreign authorities do not turn a blind eye to such operational inefficiencies. Schengen embassy chooses companies which are well-equipped to handle such services for travellers," said an industry analyst.
 
Source : Dna
http://www.dnaindia.com/india/report-schengen-blacklists-14-indian-insurance-companies-1970400
 



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