A report on

An analysis of POLICIES AND SCHEMES OF

INSURANCE FOR DISASTER MANAGEMENT

By
GENESIS COSMILLA

A report on OF INSURANCE FOR

DISASTER MANAGEMENT

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 ACKNOWLEDGEMENT

Sometimes words fall short to show gratitude, the same happened with me during this project.
The immense help and support received from Our School

As I sum up draft of my study, I appreciatively reminisce the contribution of all those people without
whose support and help, this study would have never taken its present form.

My sincere gratitude to (teacher mo) for providing me with an opportunity to do this research

I also very thankful to my friends who help me in completion of the project. I am thankful to that
power that always inspires me to take right step in the journey of success of my life.

Table of contents:
Contents page no.
Page 2
Executive summary 7
Objectives 8
Introduction 8
Company profile 9
Company overviews 9
Disaster 12
Classification of disaster 12
Natural disaster 12
Manmade disaster 13
Hazard vulnerability in INDIA 13
Administrative structure for disaster management in UTTARANCHAL 16
National disaster management framework 21
Disaster management acts 2005 25
Insurance 28
Basic insurance terminologies 28
General insurance 29
Need for insurance in disaster 30
Bodies that regulate insurance sector 32
Major challenges of insurance sector 34
Future prospects of insurance sector 35
List of general insurers 36
Market share of different companies in general insurance 37
Methodology 38
Observation and findings 39
Conclusion 43
Annexure-I Questionnaire 44
Abbreviations 46
References 46

Executive summary

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With the liberalization and entry of private players in insurance field, the Indian insurance
sector has started showing signs of significant change. Within a short span of time, private
insurance has acquired a great market share of insurance market. The study will help to find out
the awareness of disaster insurance of the people of Dehradun and accessibility of disaster
insurance in Dehradun. It also measures the perception of the people of Dehradun about
disaster insurance. What they think about disaster insurance, is it really effective to recover the
damages caused by disaster. How many of them have disaster insurance coverage, as we know
that Uttaranchal state is very disaster prone. Apart from that the report also considers the
current state of insurance market. Presently how many companies are in general insurance
business, and also the market share of different companies. It also contains the administrative
structure & their preparedness for disaster management in Uttaranchal and national disaster
management framework of India.

Objectives::

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Project will help to make people more aware about various products of different insurance
companies. This study will help to know the market situation of disaster insurance in Dehradun.
The main objectives of the studies are as follows::

 The awareness of disaster insurance of the people of dehradun and accessibility of

disaster insurance in dehradun.
 The potential role of disaster insurance for disaster risk reduction.
 To study the fruitfulness of disaster management schemes to recovery from disaster.
 To study the administrative structure & their preparedness for disaster management
in uttaranchal.
 To study the activities; and various policies and schemes of disaster management
provided by government of uttaranchal.
 To study national disaster management framework.

Introduction::
A contract between two parties is known as Insurance. Shifting or transferring of risk of loss or
damage, from owners and thereby sharing of losses by all the members of the group are main
uniqueness. Thus a contract of insurance is a contract by which one party undertakes to make good
the loss of another, in consideration of a sum of money, on the happening of a specified event. For
example fire, accident or death.

Since liberalization in 2000, the Indian insurance sector has become a buyer’s market. Owing to
liberalization customer has the choice to select from variety of products, services and service
providers. In the year 2005 karvy established a new division karvy insurance broking ltd. Karvy
insurance broking ltd. is working with most of the insurance company’s products. They can reach
every customer whatever customer needs.

Company profile::
Company overview::

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Karvy was established as karvy and company by five chartered accountants during the year 1979-80,
and then its work was confined to audit and taxation only. Later on it diversified into financial and
accounting services during the year 1981-82 with a capital of rs.150000. it achieved its first
milestone after its first investment in technology. Karvy became a known name during the year
1985-86 when it forayed into capital market as registrar.

Evolution of KARVY::
It is well said that success is a journey not a destination and we can see it being proved by karvy.
Under this section we will see that how this “karvy and company” of 1980 became “karvy” of 2008.
Karvy blossomed with the setting up of its first branch at Mumbai during the year 1987-88. The
turning point came in the year 1989 when it decided to enter into one of the not only emerging
rather potential field too i.e; stock broking. It added the feather of stock broking into its cap. At the
same time it became the member of Hyderabad Stock Exchange through associate firm karvy
securities ltd and then karvy never looked back……..it went on adding services one after another, it
entered into retail stock broking in the year 1990. Karvy investor service centers were set up in the
year 1992. Karvy which already enjoyed a wide network through its investor service centers, entered
into financial product distribution services in the year 1993. One year more and karvy was now
dealing into mutual fund services too in the year 1994 but it didn’t stopped there, it stepped into
corporate finance and investment banking in the year 1995.

Karvy’s strategy has always been being the first entrant in the market. Karvy again hit the limelight
by becoming the first registrar in the country to be awarded ISO 9002 in the year 1997. Then it
stepped into the other most happening sector i.e; IT enabled services by establishing its own BPO
units and at a gap of just 1 year it took the path of e-Business through its website www.karvy.com .
Then it entered into insurance services in the year 2001 with the launch of its retail arm “karvy- the
finapolis: your personal finance advisor”. Then in the year 2002 it launched its PCG(Private Client
Group) which looks after its High Networth Individuals .and maintain their portfolio and provides
them with other financial services. In the year 2003, it commenced secondary debt and WDM
trading.

It was a decade which saw many Indian companies going global…..so why the largest financial

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service provider of India should lag behind? Hence, karvy launched “karvy global services limited”
after entering into a joint venture with Computershare, Australia in the year 2004.the year 2004 also
saw karvy entering into commodities marketing through karvy comtrade.

Year 2005 saw karvy establishing a separate branch for its insurance services under the head “ karvy
insurance broking ltd” and in the same year, after being impressed with the rapid growth of karvy
stock broking limited, PCG group of Hong Kong acquired 25% stake at KSBL. In the year 2006, karvy
entered into one of the hottest sector of present time i.e real estate through Karvy realty& services
(India) ltd. hence , we can see now karvy being established as the lagest financial service provider of
the country.

Reason behind the success of karvy::

karvy achieved success by working mainly on eight basic points; these are trust, integrity,
dedication, commitment, enterprise, hard work and team play, learning and innovation, empathy
and humility.

Mission statement::
“Our mission is to be a leading and preferred service provider to our customers, and we aim to
achieve this leadership position by building an innovative, enterprising , and technology driven
organization which will set the highest standards of service and business ethics.”

Now karvy group consists of 10 highly renowned entities which are as

follow::
: The first securities registry to receive ISO 9002 certification in India. Registered
with SEBI as Category I Registrar, is Number 1 Registrar in the Country. The award of being ‘Most
Admired’ Registrar is one among many of the acknowledgements that Karvy received for customer
friendly and competent services.

: karvy stock broking ltd. Consists of five units namely stock broking servics,
depository participant, advisory services, distribution of financial products, advisory services and
private client goups.

:: Karvy Financial Services Ltd. is a wholly owned subsidiary of Karvy Stock

Broking Ltd. Karvy Stock Broking Ltd a member of the National Stock Exchange of India and the

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Bombay Stock Exchange, ranks among the top 5 stock brokers in India. With over 6 Lac active
accounts, it ranks among the top 5 Depositary Participant in India, registered with NSDL and CDSL.

: It is a SEBI registered Merchant Banker has emerged as a leading Investment

Banking entity in the country with over a decade of experience. KISL has built its reputation by
capitalizing on its qualified professionals, who have successfully executed a large number of complex
and unique transactions

: karvy insurance broking ltd is also a part of karvy stock broking ltd. At Karvy
Insurance Broking Limited both life and non-life insurance products are provided to retail
individuals, high net-worth clients and corporates.

: The company provides investment, advisory and brokerage services in Indian

Commodities Markets. And most importantly, it offer a wide reach through our branch network of
over 225 branches located across 180 cities.

: Karvy Global is a leading business and knowledge process outsourcing

Services Company offering creative business solutions to clients globally. It operates in banking and
financial services, inurance, healthcare and pharmaceuticals, media , telecom and technology. It has
its sales and business development office in New York, USA and the offshore global delivery center in
Hyderabad, India

: Karvy Realty (India) Limited is engaged in the business of real estate and
property services offering:

Buying/ selling/ renting of properties

Identifying valuable investments opportunities in the real estate sector
Facilitating financial support for real estate and investments in properties
Real estate portfolio advisory services

:: Karvy Data Management Services is the domestic BPO arm of the Karvy
Group and services corporate across various industry verticals and business horizons.
KDMS is committed to provide best in class, value driven business solutions to its clients by way of its
innovative techniques and technology framework.

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 : it is a joint venture between Computershare, Australia and KarvyConsultants
Limited, India in the registry management services industry.

DISASTER::
WHAT IS DISASTER::
Disaster is the tragedy of a natural or human-made hazard (a hazard is a situation which poses a
level of threat to life, health, property, or environment) that negatively affects society or
environment.

CLASSIFICATION::
Disaster can bi classified into two categories viz. NATURAL DISASTER and MAN–MADE DISASTER.

NATURAL DISASTER::
A natural disaster is a consequence when a natural hazard (e.g., volcanic eruption or earthquake)
affects humans. Human vulnerability, caused by the lack of appropriate emergency management,
leads to financial, environmental, or human impact.

VARIOUS TYPES OF NATURAL DISASTER::

1. EARTHQUAKE:: An earthquake is the result of a sudden release of energy in the Earth's crust
that creates seismic waves.
2. AVALANCHE:: An avalanche is a rapid flow of snow down a slope, from either natural triggers
or human activity.
3. FLASHFLOOD:: A flash flood is a rapid flooding of geomorphic low-lying areas - washes, rivers,
dry lakes and basins. It may be caused by heavy rain associated with a storm, hurricane, or
tropical storm or meltwater from ice or snow flowing over icesheets or snowfields.
4. FLOODS:: A flood is an overflow or accumulation of an expanse of water that submerges
land.
5. LANDSLIDES:: A landslide or landslip is a geological phenomenon which includes a wide
range of ground movement, such as rock falls, deep failure of slopes and shallow debris
flows, which can occur in offshore, coastal and onshore environments.

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 6. CYCLONES:: A cyclone is an area of closed, circular fluid motion rotating in the same
direction as the Earth
7. DROUGHT:: A drought is an extended period of months or years when a region notes a
deficiency in its water supply. Generally, this occurs when a region receives consistently
below average precipitation

MAN MADE DISASTER::

Disasters caused by human action, negligence, error, or involving the failure of a system are called
man-made disasters.

Man-made disasters are in turn categorized as technological or sociological.

Technological disasters are the results of failure of technology, such as engineering failures,
transport disasters.

Sociological disasters have a strong human motive, such as criminal acts, stampedes, riots and war.

VARIOUS MAN –MADE DISASTER::

1. STAMPADE:: A stampede is an act of mass impulse among herd animals or a crowd of people
in which the herd (or crowd) collectively begins running with no clear direction or purpose.
2. Road accidents.
3. Rail accidents.
4. Boat accidents.
5. Building and bridge collapse.
6. Bomb explosions.

Hazard vulnerability in india::

 54% of land vulnerable to earthquakes.

 8% of land vulnerable to cyclones.

 5% of land vulnerable to floods.

 More than 1 million houses damaged annually , plus human, social, and other losses.
EARTHQUAKES::
 12% land is liable to severe earthquakes [intensity MSK(Medvedev-Sponheuer-Karnik) IX or
more]

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  18% land is liable to MSK VIII.

 25% land is liable to MSK VII.

 Biggest quakes in :: Andamans , Kuchchh , Himachal, Kashmir, North Bihar and the North
East.

WIND AND CYCLONES::

 1981-1990 :: 262 cyclones[92 severe] in a 50 km wide strip of the east coast.

 Less severe cyclonic activity on west coast[ 33 cyclones in the same period].

 In 19 severe cyclonic storms , death toll> 10000 lives.

 In 21 cyclones in Bay of Bengal 1.25 million lives have been lost.

FLOODS::
 Floods in the Indo-Gangetic-Bramhaputra plains are an annual feature.

 On an average , a few hundred lives are lost.

 Millions are rendered homeless .

 Lakhs of hectares of crops are damaged every year.

Increasing visibility and impacts of disaster::

Natural disasters are increasingly making headline news, due to the impact of modern
communications and connectivity, and the proliferation of TV and news media.

There is hardly any part of the globe, whether Asia, Africa, Oceania or elsewhere which is really free
from natural disaster of one kind or the other. Painful tales of what they mean are told to us either
by the kith and kin of the dead, or by the lucky survivors of the natural disasters they have personally
gone through. To say that these disasters take heavy toll of life and property or derail national
economics, is an understatement. In some cases, they wipe out the future of generations, still
unborn.
The past decade has witnessed frequent natural hazards all over the world. At the beginning of the
1990s, the events that hit the headlines were mainly earthquakes and windstorms. Some of the
examples are the winter storms in Europe in 1990, Typhoon Mireille in Japan in 1991, Hurricane
Andrew in Florida in 1992, the earthquakes in California in 1994 and Kobe in 1995; 1998 was the

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year of largest number of events and highest damages cost and witnessed floods as most notable
events. Severe floods as the aftermath of storm surges in the wake of tropical cyclones were also
noticed as in the case of Gujarat, in June 1998, and Central America at the end of October. The
recent super cyclone in Orissa (1999), a catastrophe claiming more than 10,000 lives and recently
the earthquake of Gujarat in the new millennium are the most tragic events that have shaken up the
world. The analysis and trends of these natural catastrophes world over indicates:

During last ten years the number of great natural disasters have increased three times and
economic losses due to these disasters have increased nine times.
Number of loss events worldwide in 1998 alone (one of the years with largest number of
catastrophes in the decade) indicate that 50 per cent of the events are earthquakes and
windstorms and these have been higher in the Americas (255) compared to 202 in Asia. While
the occurrence of number of events is highest in the Americas, number of deaths occurring due
to these events have been higher in Asia, i.e. 34,303 as compared to 14,995 in the Americas.
Economic losses due to earthquakes and windstorms is highest in the Americas while these
losses are highest due to floods in Asia.

These trends (Sigma, 2001) world over indicate that in spite of technological advancements in
prediction techniques and warning systems:

There has been an increase in the occurrence of events as well as cost of damage;
Economic losses are more in developed countries than developing countries; and
Number of deaths is much more in Asia than America.

The main reasons for such dramatic increases are:

The concentration of population is constantly growing in a number of large cities, which are
often located in high-risk zones;
Greater susceptibility of modern industrial societies to catastrophes; and
Accelerating deterioration of natural environmental conditions.

Administrative Structure for Disaster Management in

Uttaranchal::

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Shortly, after the carving out of state of Uttaranchal, a new administrative structure for disaster
management has been put in place, The state became the first in the country to have ministry of
Disaster Management. The structure of disaster management system is as follows::

Institutional Arrangements at District Level::

Transit Camp Relief Camp Cattle Camps Feeding Centres

Institutional arrangements at state level::

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 Ministry of Disaster Management

Pr. Secretary of Disaster Management

Commissioner Disaster Management Disaster Management and Mitigation

Center

Pr. Secretary of Disaster Management

Disaster Mitigation and Management Centre::

The disaster mitigation and management centre is the apex centre in the field of disaster mitigation
and management in Uttaranchal. It was established in October 2001. The objectives of DMMC are
 To find and promote solutions to the root causes of disasters in the state of Uttaranchal and
 To facilitate the smooth transition from relief to rehabilitation and development. DMMC has a
well structured framework to carry out its activities. It involves three focallayers of
participatory organizations.
1. State level: Ministry/department of disaster management through State emergency
Operations Group under the control of Principal Secretary/ Commissioner, disaster
management.
2. District level: District ,Magistrate through District Emergency Operations Group
under the control of District Disaster Manager.

3. Local level: Tehsil/Block/Village through Site Operations Centre under the control of
the Site Manager.
Through these institutions, DMMC strives to::
 Offer an extensive range of training programmes.
 Provide advance information about likely disasters through latest technologies.
 Maintain a network of experienced experts working in the field.
 Provide consultancy services to all levels of government and NGOs and  Develop a strong
regional knowledge base towards disaster policy.
The DMMC has also formulated a strategy to be adopted for five years from its inception.
These include::
 Setting up of State Emergency Operations Group.
 Setting up of District Emergency Operations Group
 Institutional Strengthening and Coordination

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  Strengthening of Village Disaster Intervention team.
 Creation and strengthening of Rescue Teams.
 Networking of NGOs.
 Capacity building, training and sensitization.
 Creation of RS/GIS Database for village, town, block and the district.
 Updating the strategy for disaster management from the lessons learnt.  Technical
assistance to the Government of Uttaranchal and  Consultancy.

District Project Officer::

Amongst the various initiatives taken for disaster management is the creation of a post of District
Project Officer. This new post has been created under the Disaster Risk Management Program of
Government of India-United Nations Development Programme [UNDP]. This program aims to
contribute towards the social and economic development goals of the national and state
Governments by enabling them to programme is being implemented in 8 districts of Uttaranchal
with the help of the local governments and PRI institutions in two phases.
The District Project Officer (DPO) will be posted at district head quarters to work in consultation with
the state nodal agency DMMC and under the direct supervision of the District Magistrate and
perform the following duties;
 Facilitate and Coordinate for preparation of multi-hazard Disaster Management plans of the
District, Blocks, GPs and Villages along with government functionaries.
 Help the District administration Block for selection of partners for the Community Based
Disaster preparedness work.
 Helping in development of awareness campaign strategy and awareness generation activities
like street plays, rallies, painting and drawing competitions amongst school children on
disaster preparedness.
 Supporting in the training and capacity building programme of government officials/PRIs/
NGOs/CBOsN outh Clubs/ SHGs Teachers and others concerned on various aspects of disaster
management.
 Facilitate the process Community Based Disaster Preparedness exercises at blocks, GP and
village levels through active involvement of government officials, PRIs, NGOs/CBOs, youth
clubs.
 Coordinating and facilitating training programmes for disaster management task forces
formed at various levels on Health and First Aid, Search and Rescue Operation, Sanitation,
Shelter Management, Carcasses & Garbage disposal, use of early warning equipments IEM!
radio operation etc.
 Establishing linkages with Civil Society Response group at various levels for emergency
response plan development.

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  Networking with NGOs/CBOs/NCC/NSS and other agencies working in the field of Disaster
Management for unification of the strategy and process.
 Assisting the Collector and District Magistrate in performing all activities related to disaster
management.
 Regular reporting to the Collector State Nodal Agency and State Project Officer on the
programme activities.
 Helping district administration in organizing mock drill at various levels.
 Facilitating establishment of effective communication systems for early tracking and
dissemination of warnings at the district level.
 Facilitating establishment of control rooms at District and block levels for Disaster
Management Information dissemination.

Initiatives for Earthquake Resistant Houses::

In 1999, Garhwal was rocked with an earthquake which was measured 6.8 on the richter scale.It was
second major earthquake in the last 10 years. Around 20000 houses collapsed,85000 houses
damaged and 130 people lost their lives. One of the prime reasons of such a huge devastation was
that the structures could not withstand the tremors because the design and quality of these houses
was substandard. Earthquake resistance was not kept in view while constructing these houses. Thus,
it is felt today that all houses in Uttaranchal should be earthquake resistant. Constructing a new
house is an expensive preposition and more so in the hilly terrains as it is difficult to transport
modem construction equipments and articles in these regions. Moreover, construction activities lead
to environmental degradation which is a potential threat in the region. In this context, it becomes
imperative to repair and retrofit the existing structures so that they can withstand any future
eventuality. It is not only cost effective hut also will help in future from the devastating aftereffects
of earthquakes. The existing structure should be repaired and retrofitted accordingly, while, the new
structures should be constructed as per the earthquake resistant techniques. With the help of
modem day techniques, the old houses can be converted into earthquake resistant houses without
demolishing them even there is no need to remove the roofs. It is not required that houses should
be of brick, cement and iron rods only. It is quite possible to construct houses with the locally
available materials. The only thing which should be kept in mind is that appropriate techniques
should be adopted.

Repair and Retrofitting of Existing Houses::

The house owners have little or no awareness about the dangers of a future disaster and the ways
the houses can be made stronger to withstand the impact of a future disaster. It is difficult for
people to invest more than their already stretched resources in their houses to build better. There is

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little or no knowledge in the public about the alternate affordable technologies. Nor do the people
know that their vulnerability to future disasters can be reduced through the use of suitable
technologies for the construction.
DMMC has taken up this task and is creating awareness in this regard through its machinery. It has
laid down various categories of damage as G-l, G-2, G-3, G-4. and has developed detailed plan to
rectify that.
In order to prove the strength of such houses an experiment was done in Latur in 1998-99. In this
demonstration two houses were constructed on a temporary platform. The first one was a
traditional house of stone, mud and wood while the second was again a traditional house but
Retrofit with new techniques. Now, earthquake like situation was created by hitting the platform
with a tractor. It was shown that Retrofitted house withstand such collisions. The total expenditure
in Retrofitting. is just 15% of constructing a new house. This experiment is being given wide publicity
through pamphlets and training programmes to build up acceptability and confidence of the masses.
DMMC has prepared booklets for local masons in Hindi language.
These booklets are prepared after taking into account the experiences of Lattur in Maharashtra,
Jabalpur in MP and Uttaranchai state's own house construction methods. Aiso, earthquake related
Indian standards have been taken into account.

Training::
One major initiative taken by DMMC is that of Building centers which have played a pivotal role in
promoting safer building technologies and practices. A number of workshops involving middle level
government officers, academicians and engineers took part in the workshops. These workshops
were:
 Review of functioning of Building Centers, their role in Earthquake Resistant Constructionand
means to revitalize them.
 Review of adequacy of current legislation in implementation of Building codes and meansto
improve implementation of codes.
 Review of current curriculum with regard to awareness about Earthquake Vulnerability
of the state population and recommendations to include Earthquake Engineering in Civil
Engineering curriculum.

Mason's Training::
To percolate the awareness and technology at the bottom level DMMC has organized training camps
for the Masons. One such camp was held in the district Rudraprayag from 28th March to 31st March
2004. In this camp, 35 masons from different villages were trained by experts in building earthquake
resistant structures and retrofitting techniques. In the training, a model of different retrofit
techniques was constructed. It consisted of traditional as well as modem design of construction and
their retrofitting. During our visit to Rudraprayag district we visited the place and had a look on this

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model. In order to prevent the sliding of lower portion of hills one more model was constructed
there. These masons after getting trained will further act as 'gurus' to their next generations and will
ensure the sustainability of the process. At the district level, a computerized database of trained
masons and construction workers is being created. Till date, 800 masons have been registered in the
database.

Integration with Other Schemes::

DMMC is also exploring the possibilities of integrating disaster preparedness and mitigation efforts
with other government schemes.

IAY::
Under this scheme government provides assistance to weaker and marginalized sections of society
to construct houses. DMMC is trying that all houses to be constructed under the scheme should be
earthquake resistant. Block offices are taking care of this aspect. During our field visit, we came
across one such initiative where a BPL family who lost their house due to sinking of the ground was
provided a house under lAY.
53

Rina Sahay Yojana::

Under this scheme, Government of Uttaranchal is providing a loan of Rs 30000-40000 with Rs 10000
as subsidy to construct earthquake resistant houses.

NATIONAL DISASTER MANAGEMENT

FRAMEWORK::
I.INSTITUTIONAL MECHANISMS::
Expected Outputs Areas of intervention Agencies/sectors to be
involved and resource
linkages
Nodal agency for (i)Constitution of Ministries/ Departments
disaster management National Emergency of Health, Water
at the national level Management Resources, Environment
with appropriate Authority with and Forests, Agriculture,
systems appropriate legal, Railways, Atomic
financial and Energy, Defence,
administrative powers.

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 (ii)Roles and responsibilities Chemicals, Science &
of the Technology, Rural
NEMA: Development, Road
-Coordinating multi hazard Transport & Highways etc.
mitigation, prevention,
preparedness and response
programs. - Policies for
disaster risk reduction and
mitigation -Preparedness at all
levels.
-Coordination of response -
Coordination of post disaster
relief and rehabilitation.
-Amendment of existing laws,
procedures, instructions.
Ministries/ Departments of
Health, Water Resources,
Environment and Forests,
Agriculture, Railways, Atomic
Energy, Defence, Chemicals,
Science & Technology, Rural
Development, Road Transport
& Highways Etc.
Setting up State Disaster (i) State Disaster Ministers for
Management Authorities Management Authority to Agriculture, Home,
be headed by the Chief Disaster Management,
Minister. Water Resources,
(ii) The Authority to Health, Road &
lay down policies and Transport, Civil
monitor mitigation, Supplies, Environment &
prevention and Forests, Rural
preparedness as also Development, Urban
oversee response. Development and Public
Health
Engineering
Departments as
Members.

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II.LEGAL/POLICY FRAMEWORK::
Disaster Management to (i) Bill to be drafted. Ministry of Home
be listed in List – III – Affairs/
[Concurrent List] of (ii) Bill to be brought Ministry of Law
Seventh Schedule to the before Parliament (Legislative Department)
Constitution
State Disaster Model Act to be circulated Ministry of Home
Management Acts to the States. Affairs
State Governments
National Policy on (i) Mainstreaming Ministry of Home
Disaster Management disaster management Affairs, Ministry of
into planning and Finance, Planning
development process. Commission, Ministry of
Environment & Forests,
(ii) Mandate safe Rural Development,
construction. Urban Development and
other relevant
(iii) Coordinated Ministries to be
action by all relevant consulted.
Departments as per policy

States to enunciate (i) Mainstreaming State Governments

Policy on Disaster disaster management
Management . into planning and
development process.

(ii) Mandate safe

construction.

(iii) Coordinated
action by all relevant
Departments as per policy

State Disaster Amendment of State Governments

Management Codes existing relief
codes/scarcity

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 codes/famine codes to
incorporate mitigation,
preparedness and
planning measures at all
levels from community
to State, constitution of
Emergency Support
Teams /Disaster
Management Teams
/Committees /State
Disaster Management
Authorities, delegation of
administrative and
financial powers to
disaster incident
managers etc, protocol to
update the inventory of
resources and plans.

iii.EARLY WARNING
SYSTEMS::

(i) State of the art (i) IMD/CWC to carry Indian Meteorological

sensors to be set up. out a review of sensors
(ii) Hazard monitoring, available and draw up
tracking and plans for strengthening the
modelling. system.
(ii) Models to be
updated to improve
prediction accuracy.
Warning Protocols (i) Warning protocols to
be user friendly. (ii)
Warning to be
communicated as quickly
as possible to the
States/districts/
community. (iii) Protocols
should be simple to
Department/ Central
Water Commission/
National Centre for
Medium Range
Weather Forecasting
Ministry of Home
Affairs/ State
Governments /Indian
Meteorological
Department/ Central
Water Commission/
National Remote
Sensing Agency/

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 understand. (iv) Districts to Information and
set up protocols for Broadcasting/
communication of early Doordarshan/ All India
warning to the community. Radio.
(v) Panchayats/local bodies
to be used for early
warning communication.
vi) Communication linkages
for early warning.

Disaster Management Act, 2005::

The Act lays down institutional, legal, financial and coordination mechanisms at the National, State,
District and Local levels. These institutions are not parallel structures and will work in close harmony.
The new institutional framework is expected to usher in a paradigm shift in DM from relief-centric
approach to a proactive regime that lays greater emphasis on preparedness, prevention and
mitigation.

Institutional Framework under the Act::

National Disaster Management Authority (NDMA)::

The NDMA, as the apex body for disaster management, is headed by the Prime Minister and has the
responsibility for laying down policies, plans and guidelines for DM and coordinating their
enforcement and implementation for ensuring timely and effective response to disasters. The
guidelines will assist the Central Ministries, Departments and States to formulate their respective
DM plans. It will approve the
National Disaster Management Plans and DM plans of the Central Ministries/Departments. It will
take such other measures, as it may consider necessary, for the prevention of disasters, or
mitigation, or preparedness and capacity building, for dealing with a threatening disaster situation or
disaster. Central Ministries/Departments and State Governments will extend necessary cooperation
and assistance to NDMA for carrying out its mandate. It will oversee the provision and application of
funds for mitigation and preparedness measures. NDMA has the power to authorise the
Departments or authorities concerned, to make emergency procurement of provisions or materials
for rescue and relief in a threatening disaster situation or disaster. The general superintendence,
direction and control of the National Disaster Response Force (NDRF) is vested in and will be
exercised by the NDMA. The National Institute of Disaster Management (NIDM) works within the
framework of broad policies and guidelines laid down by the NDMA.

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The NDMA is mandated to deal with all types of disasters; natural or man-made. Whereas, such
other emergencies including those requiring close involvement of the security forces and/or
intelligence agencies such as terrorism (counter-insurgency), law and order situations, serial bomb
blasts, hijacking, air accidents, CBRN weapon systems, mine disasters, port and harbor emergencies,
forest fires, oilfield fires and oil spills will continue to be handled by the extant mechanism i.e.,
National Crisis Management Committee (NCMC).

National Executive Committee (NEC)::

The NEC comprises the Union Home Secretary as Chairperson, and the Secretaries to the Govt. of
India in the Ministries/Departments of Agriculture, Atomic Energy, Defence, Drinking Water Supply,
Environment and Forests, Finance (Expenditure), Health, Power, Rural Development, Science &
Technology, Space, Telecommunications, Urban Development, Water Resources and the Chief of the
Integrated Defence Staff of the Chiefs of Staff Committee as members. Secretaries in the Ministry of
External Affairs, Earth Sciences, Human Resource Development, Mines, Shipping, Road Transport &
Highways, and the Secretary, NDMAwill be special invitees to the meetings of the NEC.

The NEC is the executive committee of the NDMA, and is mandated to assist the NDMA in the
discharge of its functions and also ensure compliance of the directions issued by the Central
Government. The NEC is to coordinate the response in the event of any threatening disaster
situation or disaster. The NEC will prepare the National Plan for Disaster Management based on the
National Policy on Disaster Management. The NEC will monitor the implementation of guidelines
issued by NDMA. It will also perform such other functions as may be prescribed by the Central
Government in consultation with the NDMA.

State Disaster Management Authority (SDMA)::

At the State level, the SDMA, headed by the Chief Minister, will lay down policies and plans for DM in
the State. It will, inter alia approve the State Plan in accordance with the guidelines laid down by the
NDMA, coordinate the implementation of the State Plan, recommend provision of funds for
mitigation and preparedness measures and review the developmental plans of the different
Departments of the State to ensure the integration of prevention, preparedness and mitigation
measures.

The State Government shall constitute a State Executive Committee (SEC) to assist the SDMA in the
performance of its functions. The SEC will be headed by the Chief Secretary to the State Government
and coordinate and monitor the implementation of the National Policy, the National Plan and the
State Plan. The SEC will also provide information to the NDMA relating to different aspects of DM.

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District Disaster Management Authority (DDMA)::
The DDMA will be headed by the District Collector, Deputy Commissioner or District Magistrate as
the case may be, with the elected representative of the local authority as the Co- Chairperson. The
DDMA will act as the planning, coordinating and implementing body for DM at the District level and
take all necessary measures for the purposes of DM in accordance with the guidelines laid down by
the NDMA and SDMA. It will, inter alia prepare the District DM plan for the District and monitor the
implementation of the National Policy, the State Policy, the National Plan, the State Plan and the
District Plan. The DDMA will also ensure that the guidelines for prevention, mitigation, preparedness
and response measures laid down by the NDMA and the SDMA are followed by all the Departments
of the State Government at the District level and the local authorities in the District.

Local Authorities::
For the purpose of this Policy, local authorities would include Panchayati Raj Institutions (PRI),
Municipalities, District and Cantonment Boards, and Town Planning Authorities which control and
manage civic services. These bodies will ensure capacity building of their officers and employees for
managing disasters, carry out relief, rehabilitation and reconstruction activities in the affected areas
and will prepare DM Plans in consonance with the guidelines of the NDMA, SDMAs and DDMAs.
Specific institutional framework for dealing with disaster management issues in mega cities will be
put in place.

National Institute of Disaster Management (NIDM)::

The NIDM, in partnership with other research institutions has capacity development as one of its
major responsibilities, along with training, research, documentation and development of a National
level information base. It will network with other knowledge-based institutions and function within
the broad policies and guidelines laid down by the NDMA. It will organise training of trainers, DM
officials and other stakeholders. The NIDM will strive to emerge as a ‘Centre of Excellence’ in the
field of Disaster Management.

National Disaster Response Force (NDRF)::

For the purpose of specialised response to a threatening disaster situation or disasters/ emergencies
both natural and man-made such as those of CBRN origin, the Act has mandated the constitution of
a National Disaster Response Force (NDRF). The general superintendence, direction and control of
this force shall be vested in and exercised by the NDMA and the command and supervision of the
Force shall vest in an officer to be appointed by the Central Government as the Director General of
Civil Defence and National

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Financial Arrangements::
National Disaster Response and Mitigation Funds::
A National Disaster Response Fund may be constituted as mandated in the Act. The National Disaster
Response Fund will be applied by the NEC towards meeting expenses for emergency response, relief
and rehabilitation, in accordance with the guidelines laid down by the Central Government in
consultation with the NDMA. The proposal for merging the National Calamity Contingency Fund
(NCCF) with the National Disaster Response Fund shall be as recommended by the Finance
Commission from time to time.
Similarly, as mandated by the Act, the National Disaster Mitigation Fund (NDMF) may be created for
projects exclusively for the purpose of mitigation. The NDMF shall be applied by the NDMA and shall
be as recommended by the Finance Commission from time to time.

Insurance::
Nothing is certain in this world except the death but even in this the timing of death is not certain.
There is uncertainty in the world. Every one has a desire to be secure. Every one takes precautionary
measures to prevent the unforeseen and unfortunate events. Even then , accidents do occur.
Therefore to cover such incidents we require insurance . This occurrence has to be random,
accidental and not the deliberate creation of the insured person. Risk which may be measured in
money and which is not against public policy can only be insured.
Insurance is a technique , which provides for collection of small amounts of premium from many
individuals out of which losses suffered by few are reimbursed. In this method, the individual insured
is able to buy protection through the payment of a small cost viz. premium.
Functionally insurance may be defined as a method where by the uncertain risks of individuals are
combined in a group through small individual contributions out of which those who suffer losses are
reimbursed.
Legally insurance is a contract between the insurer and the insured where by in consideration of
payment of the premium by insured , the insurer agrees to make good any financial loss the insured
may suffer due to the operation of a peril insured
The policy which is a document issued by the insurer is evidence of the contract. A contract of
insurance does not undertake to prevent the occurrence of the peril insured against. What it
provides is a promise to make good the financial loss caused by the operation of the insured peril.

BASIC INSURANCE TERMINOLOGIES::

Insured::
The person known as the policyholder, a person with insurance coverage.
Insurer::
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A company licensed to transact the business of insurance and issue insurance policies. Policy::
It's the written contract between an insurance company and its insured. It defines what the company
agrees to cover for what period of time and describes the obligations and responsibilities of the
insured. Premium::
It's the amount of money a policyholder pays for insurance protection. Claim::
It's the notice to the insurance company that under the terms of a policy, a loss maybe covered.
Indemnity::
Legal principle that specifies an insured should not collect more than the actual cash value of a loss
but should be restored to approximately the same financial position as existed before the loss.
Broker::
An organization or person paid by the policyholder to look for insurance on their behalf. Expiration
Date::
This is the date on which the policy ends. Grace
Period::
A period (usually 30 or 31 days) following each insurance premium due date, other than the first due
date, during which an overdue premium may be paid. All provisions of the policy remain in force
throughout this period Limit::
It's the maximum amount paid by the insurance company under the terms of a policy. Underwriting::
The process of classifying applicants for insurance by identifying characteristics such as age, gender,
health, occupation and hobbies. People with similar characteristics are grouped together and are
charged a premium based on the group's level of risk.

GENERAL INSURANCE::
Insurance other than ‘Life Insurance’ falls under the category of General Insurance. General
Insurance comprises of insurance of property against fire, burglary etc
The non-life insurance sector is on an upswing! The non-life insurance industry in India has grown by
over 16 % p.a. over the last 5 years.
There is a vast business potential that lies untapped, as more and more cities enter the development
phase….
Mr. Yogesh Lohiya,
Chairman-cum-Managing Director of gic

WHO SHOULD BUY GENERAL INSURANCE?

Anyone who owns an asset can buy insurance to protect it against losses due to fire and theft and so
on. Each one of us can insure our and our dependents’ health and well being through hospitalization
and personal accident policies. To buy a policy the person should be the one who will bear financial
losses if they occur. This is known as insurable interest.

Page 26
RISK COVERED UNDER GENERAL INSURANCE::
Non-life insurance companies have products that cover property against fire and allied perils, flood,
storm and inundation, earthquake and so on. There are products that cover property against
burglary, theft etc. The non-life companies also offers policies covering machinery against
breakdown, there are policies that cover the hull of ships and so on.

IMPORTANCE OF GENERAL INSURANCE::

General insurance cover is necessary for every family. It is important to protect one’s property,
which one might have acquired from one’s hard earned income. A loss loss or damage to one’s
property can leave one shattered. Losses created by catastrophes such as tsunami, Earthquakes,
Cyclones etc.have left many homeless and penniless. Such losses can be devastating but insurance
could help mitigate them. Property can be covered , so also the people against personal accidents. A
health insurance policy can provide financial relief to a person undergoing medical treatment
whether due to a disease or an injury.
Industries also need to protect themselves by obtaining insurance covers to protect their building ,
machinery, stocks etc. They need to cover their liabilities as well. Financiers insist on insurance.
So ,most industries and businesses that are financed by banks and other institutions do obtain
covers. But are they obtaining the right covers? And are they insuring adequately are questions that
need to be given some thought. Also organizations or industries that are self-financed should ensure
that they are protected by insurance.

Need for insurance in disasters::

In the Indian context where people below the poverty line are high and per capita income is low,
insurance penetration is bound to be low. It is, therefore, essential to make the best use of available
public insurances and affordable commercial insurances, in disaster mitigation.

The loss of property in Gujarat is likely to be close to Rs 10,000 crore. Most of this was residential
property and, tragically, uninsured. This means that survivors of the quake are faced with the bleak
prospect of not getting a penny for what most would have regarded a rock solid investment, built
with a lifetime’s savings. The irony is that earthquake insurance is available in the country. Most
industrial establishments are, in fact, insured against earthquakes and fire. But, residential
establishments seldom are. This must change. Just as in the case of motor insurance, where third
party insurance is compulsory, insurance against calamities – earthquake, flood or fire – must also be
made compulsory. It already is in most developed countries – where property is separately insured
against different kinds of risk depending on the location and exposure to the risk in question – and
there is no reason why it should not be made so in India as well.

Page 27
People affected by calamities would not then have to depend on charity, but would instead be able
to face the prospect of their immediate state of homelessness with greater equanimity, secure in the
knowledge that they will receive compensation once they file their insurance claim. It was US
insurance companies that picked up the tab after Hurricane Mitch and the earthquake in Los
Angeles, for instance. True, it left many insurance companies bleeding but that risk is an integral part
of the insurance business. This will have the additional advantage of serving as a check on the quality
of construction, since insurance companies, anxious to limit their liability, will insist on certain
minimum standards being met. For the same reason, they will also be compelled to draw up zoning
maps, demarcating areas as flood/earthquake/ cyclone prone and accordingly tailor policies to the
requirements of each area instead of having the current one-size-fits-all approach.

The insurance industry has at its disposal comprehensive worldwide loss experience which it uses
not only in calculating premiums commensurate with the risk and in classifying hazard areas, known
as rating zones, but also in tracing relationships between event intensity and loss intensity and
estimating loss potentials from realistic disaster scenarios (Gopalakrishanan, 2001).

On the other hand, the insurance industry is known to have extensive information in the form of
leaflets, brochures, films and television spots with which it alerts the public to risks and draws
attention to possible effective precautions.

Before, such information campaigns have concentrated on fire, accident and burglary prevention;
efforts today are shifting more and more to the area of natural hazards, where there are many
possibilities for loss prevention, which hitherto have scarcely been tapped.

Some of the important milestones in the general insurance business in india::

 1907:: The Indian Mercantile Insurance Ltd. Set up , the first company to transact all classes
of general insurance business.
 1957:: General Insurance council , a wing of the Insurance Association of India, frames a code
of conduct for ensuring fair conduct and sound business practices.
 1968:: The Insurance Act amended to regulate investments and set minimum solvency
margins and the tariff Advisory Committee set up.
 1972:: The General Insurance Business (Nationalization) Act,1972 nationalized the general
insurance business in India with effect from 1st January 1973.

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  107 insurers amalgamated and grouped into four companies viz. the National insurance
company ltd.,the new india assurance company ltd., the oriental insurance company ltd., and
the united india insurance company ltd. GIC incorporated as a company.

BODIES THAT REGULATE THE SECTOR::

For better regulation purpose of the insurance sector the government has established following
bodies:

1. IRA:: Insurance Regulatory Authority::

The IRA, under the chairmanship of Rangachary, was set-up in January 1996. The IRA Bill has
to be passed by parliament to make the IRA a statutory body. Comprehensive legislation
aimed at reviewing the insurance Act of 1938 and repealing the life insurance corporation
Act of 1956 have to be passed.

2. IRDA:: Insurance Regulatory and development Authority::

The Insurance Regulatory and Development Authority, constituted under the IRDA Act, 1999,
provide for the establishment of an authority to protect the interest policyholders, to regulate,
promote and ensure orderly growth of the life insurance industry.

Business Requirement:-
A company will not be issued a license unless the IRDA is satisfied with the sound financial condition,
the general character of management, the volume of business, the capital structure, earning
prospects for the insurers and that the interests of the general public will be served if registration is
granted to the insurer.
Foreign insurance companies have been allowed to have a maximum 26% share holding. No life
insurance company can be registered under the Act unless they have a paid up capital of Rs.100
crores. Every life insurer shall deposit with the reserve bank of India one percent of the total gross
premium written in India in any financial year, not exceeding Rs.10 crores
.

Investment of Assets:-
Every insurer is required to invest, and keep invested, assets equivalent to not less
than the net liabilities as follows:
a. 25 % in government securities,
b. a least 25% of the said sum in government securities or other
approved securities and
b. the balance in any approved investment rated as “very strong” or more by reputed rating
agencies, which include various debt instruments on which dividend on its ordinary shared
for the five years immediately preceding or for at least five out of the six or seven years
Page 29
 immediately preceding have been paid and which have priority in payment over ordinary
shares of the company in winding up.

3. TAC:: Tariff Advisory Committee::

The tariff advisory committee established under the Act is empowered to control and regulate the
rates, terms, and etc. that may be offered by insurers in respect of any risk or of any category of
risks. It is provided that in fixing, amending or modifying such rates etc. the committee shall try to
ensure as far as possible that there is no unfair discrimination between risk of essentially the same
hazard and also that consideration is given to past and prospective loss experience. Every insurer is
required to make payment to the TAC of the prescribed annual fees.

Present situation of General Insurance in India::

The Indian insurance sector is rapidly moving towards international standards of free (risk-based)
market pricing and new/innovative product offerings. Big changes have occurred over the last few
years, during which the sector was opened to private participation, along with foreign direct
investment (FDI) capped at 26%.

India is the 5th largest market in Asia by premium, following Japan, Korea, China and Taiwan. The
country is geographically large and has the world’s 2nd largest population -- 1.13 billion in 2007 –
but it also has one of the lowest penetration rates for property and casualty insurance in Asia in
terms of premium as a percentage of GDP.

India’s general insurance market witnessed a variety of changes as deregulation continued at a

hectic pace.
The total number of general insurers registered with IRDA are increasing day by day, with the
registration of SBI General Insurance Company Limited, a joint venture general insurance company
promoted by State Bank of India and Insurance Australia Group, Australia, as a general insurer in
December 2009. Moreover, L&T General Insurance is readying to launch its operations in the next
three to five months.

The Gross Premium underwritten by public sector non-life insurers for the April-December 2009
period posted year-on-year growth of 11.37 per cent as compared to the year-on-year growth of
7.93 per cent posted by private sector non-life insurers. Overall, the non-life insurance sector grew
9.95 per cent in April-December 2009, compared to the corresponding period last year. According to
IRDA data, out of the US$ 5.46 billion premium underwritten by the industry during the
AprilDecember 2009 period, US$ 3.24 billion came from the four public sector companies as
compared to US$ 2.91 billion during the same period in 2008.

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Moreover, in the 2010-11 budget, Finance Minister, Mr Pranab Mukherjee, has decided to roll back
the government’s decision to tax the unrealised gains of non-life insurance companies. “The
appreciation in the value of investments, being in the nature of unrealized gain is not taken into
account for determining profit or loss of non-life insurance business as per the IRDA regulations. It is,
therefore, proposed that the unrealized gains due to appreciation in the value of investments will
not be included in the total income,” according to the budget documents.

According to data from the IRDA (Summary Reports of Motor Data of Public and Private Sector
Insurers - 2008-09), in 2008-09, nearly 30 million vehicles were registered and a total premium
worth US$ 2.03 billion was collected.

MAJOR CHALLENGES::

Awareness:: It is the main problem faced by all the insurance company is lack of awareness
about Risk exposures and about insurance products available to the customers. In India only 20% of
the population is insured. Majority of the populations who are living in the rural areas and sub urban
areas are not aware of the about risk exposures and about insurance products available in the
market.

Affordability:: In India majority of the population standard of living is low and majority of them
belong to middle class and lower class and they have very little money left after satisfying basic
needs. Uneconomical premium of insurance policy is also a major constrains.
Accessibility:: The policies are complex to understand by a layman the procedures are
difficult to obtain policies if done individual .there are a lot of activities and formalities involved in
order to get the insurance policy.

Inappropriate / inadequate distribution strategies::

Majority of the population is not aware of the benefits that the insurance company provides. And
they are also not aware of the various schemes which these companies introduce.

FUTURE PROSPECTS::
 Huge market largely untapped especially in Rural & Urban regions can be targeted to
increase the number of insurer in the market.
 As high as 70% of population is still not covered by insurance. So the company can conduct
mass campaign and educated the people more about the products and also about the risk

Page 31
 covered and the various benefits which they can avail .The Company can use various
medium to increases the awareness.
 Increase in standard of living, disposable income, literacy, insurance awareness throws open
huge opportunities on insurance.
 High growth in Automobile sector.
 Huge strides in Health Care opening up huge Health Insurance potential.
 In Rural sector large number of Micro finance institutions, Self Help Groups are setup who
can be the major clients of this industry.
 The Government initiatives on Mass insurance.
 General Insurance would grow at CAGR 17% next 5years.

Pros of Disaster Insurance::

 It could save livelihoods, therefore it can be more financially sustainable than traditional
humanitarian aid, which focus on saving lives.
 By making disaster risk reduction an integral part of national policies and guaranteeing a
predictable and reliable payout in case of disaster, it will allow for longer term planning in
development.
 By reducing the need for international involvement in emergencies, it can diminish the
negative effect external relief and reconstruction interventions often have in eroding local
markets and exacerbating social inequalities (Pelling, 2007).
 It will create or reinforce the idea that the state has responsibilities to ensure its citizens’
safety and protection of their livelihoods (Pelling, 2007).
 It can increase governments self-determination.
 It can guarantee greater dignity for the beneficiaries than aid appeals (Syroka and Wilcox,
2006).
 If weather data collected are openly shared, they can be valuable for any Disaster Risk
Reduction programme.
 Current experience is, according to the experts involved in its implementation, transferable
to other countries with available historical and update weather data. The World Bank and
WFP are also exploring the opportunity for Satellite Data to be considered acceptable by the
reinsurance market as this would allow virtually insuring any country in the world against
bad weather, even if weather stations are not available.

Challenges & Limitations of Disaster Insurance ::

 There is the risk of conflict with existing response capacities, where existing systems can
overlap with new programmes complementing the Insurance (see possible conflict between
DPPC and Contingency Plan in Ethiopia3)

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  It seems quite clear from actual experience that Disaster Insurance can not be a stand alone
tool and it needs to be part of a broader contingency plan, since it can not cover the risk of
mild droughts or other chronic risks (as otherwise the premium would become too costly).
 It is not capable of addressing all types of humanitarian crisis (for instance crisis due to
conflict or poor governance) and therefore, as a social protection tool, it needs to be part of
a broader set of emergency response mechanisms (Barnett et al., 2006).
 It is also important to recognize that insurance can at the most replace losses but it is not
oriented to create improvements in quality of life (Pelling, 2007).

List of GENERAL INSURERS::

Public Sector::
National Insurance Company Limited www.nationalinsuranceindia.com
New India Assurance Company Limited www.niacl.com
Oriental Insurance Company Limited www.orientalinsurance.nic.in
United India Insurance Company Limited www.uiic.co.in
Export Credit Guarantee Corporation` www.ecgcindia.com
Agriculture Insurance Company of India Limitedwww.aicofindia.org
Private Sector::
Bajaj Allianz General Insurance Co. Limited www.bajajallianz.co.in
ICICI Lombard General Insurance Co. Ltd. www.icicilombard.com
IFFCO-Tokio General Insurance Co. Ltd. www.itgi.co.in
Reliance General Insurance Co. Limited www.ril.com
Royal Sundaram Alliance Insurance Co. Ltd. www.royalsun.com
TATA AIG General Insurance Co. Limited www.tata-aig.com
Cholamandalam General Insurance Co. Ltd. www.cholainsurance.com
Export Credit Guarantee Corporation HDFC www.ecgcindia.com
Chubb General Insurance Co. Ltd.
BHARTI-AXA General insurance
FUTURE GENERALI
ICICI Prudential General Insurance AEGON
Religare General Insurance Ltd.

REINSURER::
General Insurance Corporation of India www.gicindia.com

Page 33
Market share of different companies ingeneral insurance
industry::

Table-2

Methodology::
Literature Survey::
The analysis has started with the literature survey of various news papers, magazine which helped
the various aspects of the insurance industry in India. According to Parasuraman et al (1985)
customer’s perceptions of the service received equate with customer’s prior expectations, and then
a quality service has been delivered.

Design of Questionnaire::
A questionnaire was prepared on the basis of objective of the study. It was parted into some
categories as follows
 Personal details of the customers

Page 34
  Experience of natural disaster
 Awareness about disaster insurance
 What they think about disaster insurance is it really effective to recover the damages caused
by disaster.
A sample questionnaire is given into Annexure-I.

Design of sample survey:: Primary data was collected in the sample size of seventy five
due to time constraint. Data was collected through one to one interaction from different people. The
respondents are from govt. officers, businessmen, shopkeepers etc. The respondent were mostly from
Rajpur Road area, Balliwala chock, Canuaght Place, Gandhi Road and Indira Nagar area. They were from
different age group and income level.
Data Tabulation::

Schematics showing Methodological Steps

Observations & Findings::
EXPERIENCE OF NATURAL DISASTER

32%
YES
68% NO

Page 35
FIG:: 1 Source: Questionnaire

Out of 75 sample size it was found that in the field of experience of natural disaster natural disaster
68% respondent has experience of natural disaster. From this we can say that Uttaranchal state is a
disaster prone state.

Those have the experience of natural disaster among of them 64% of the people has the experience
of earthquake ,so it is clear that Uttaranchal state is liable to several earthquakes.

VARIOUS TYPES OF DISASTER

2%
20%
EARTH QUAKE
HOUSEHOLD FIRE
64% LAND SLIDES
14%
WIND STORM

FIG:: 2 Source: Questionnaire

FIG:: 3 Source: Questionnaire

From this figure we can interpret that the people of Dehradun generally get the information related
to disaster, how to make their home and life safer from disaster.

Page 36
 Disaster insurance coverage
12%

yes
no
88%

FIG::4 Source: Questionnaire

From this figure we can say only 12% people has disaster insurance coverage.

FIG:: 5 Source: Questionnaire

From the previous figure it is clear that 64% of the people are aware about disaster insurance , but
the most important thing is that do they have insurance coverage?

Page 37
FIG:: 6 Source: Questionnaire
From this figure we get to know that those who aware about disaster insurance among of them only
42% people has insurance coverage. The penetration of insurance should increase to reduce the
financial damages caused by disaster. Govt. should take some initiative to promote insurance. Later
we will see what the opinion of the people of Dehradun that Govt. should take some initiative to
promote disaster insurance.

FIG:: 7 Source: Questionnaire

Those who has disaster insurance coverage among of them 63% has earthquake coverage, 22%
coverage against land slides, 11% against flash flood and 4% has coverage against fire.

Page 38
FIG:: 8 Source: Questionnaire

In Dehradun in general insurance there has 4 major players general insurance corporation has 40%
market share; new india assurance has 35% market share; united india insurance has 20% market
share and oriented insurance has 5% market share.

FIG:: 9 Source: Questionnaire

I also try to find out the perception of the people of Dehradun about disaster insurance. What they
think about disaster insurance. Is disaster insurance effective to recover the damages caused by
natural disaster. 61.2% of the respondent those who aware about disaster insurance , think that
‘disaster insurance is effective to recover the damages caused by natural disaster.’ And another

Page 39
amazing thing is that 91.2% of the respondent think that Govt. of Uttaranchal should take some
initiative to improve the awareness of disaster insurance.

CONCLUSION::
Uttaranchal, due to its peculiar geographical setting is vulnerable to minor ecological changes. This
makes the state disaster prone in terms of land slides, forest fires, cloud bursts, flash floods, and
most importantly earth quakes. Given the frequency and the unpredictability of the occurrence of
these disasters, an attempt to develop capacity to undertake disaster mitigation strategies is very
important. The ultimate end of all these strategies should be to reduce the vulnerability of the state
to disasters. These programs should include, inter alia, disaster vulnerability assessment for the
entire state and investment that would reduce vulnerability. In short the emphasis of the approach
to disasters should shift from reaction to anticipation. In other words, the thrust should be on pro
active pre- disaster measures rather than post disaster response.
If any person has disaster insurance he can reduce financial loss caused by disaster. But the people
of Dehradun not so much aware about disaster insurance. In this situation Govt. of Uttaranchal
should take some initiative to improve the awareness of disaster insurance.
91.2% of the respondent think that Govt. of Uttaranchal should take some initiative to improve the
awareness of disaster insurance. 61.2% of the respondent those who aware about disaster insurance
, think that ‘disaster insurance is effective to recover the damages caused by natural disaster.
Disasters both man made and natural are one of the most challenging problems faced by the state of
Uttaranchal. It is true that we cannot avert or prevent the occurrence of many of the disasters. But
by taking appropriate steps, we can definitely reduce their effects. The focus should be on all areas
including connectivity in form of road, telecommunication and air connectivity. It is here that the
role of a proper mechanism to guide and coordinate a comprehensive disaster preparedness
programme becomes relevant. Some of the initiatives have been taken in the right direction but still
there is a long way to go.

Annexure-I::
QUESTIONNAIRE
Dear Respondent,

Thank you for taking the time to answer this questionnaire; this questionnaire is aimed at your
awareness and your perception about insurance for disaster management. Your response will be dealt
with strict confidentially and it will be used only for academic purpose. Again thank you for spending
your valuable time to fill this questionnaire.

GENERAL INFORMATION:: Optional::

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Name::……………………………………………………………… Contact no.::………………………………………………………………..

E-Mail ID::………………………………………………………….

Gender:: Male Female Marital status:: Unmarried

Married

Age Group (years old) :: Below 30 31-40 41-50 51-60 Above 60

Occupation:: Student Employee Self-Employed Other, Specify………………..

Educational qualification:: Under graduate Graduate Post-Graduate

Other, specify…………………….

Income (annually):: Below 1 lakh 1.01-3 lakh 3.01-5 lakh Above 5 lakhs.

INFORMATION RELATED TO NATURAL DISASTER AND DISASTER INSURANCE::

1. Experience of natural disaster [if no then go to question no.3].
Yes no

2. Type of disaster.
Drought Wildfire
Dust Storm Household Fire
Earthquake Wind Storm
Flood Winter Storm
Landslide / Debris Flow Other (Specify)…………………………
3. Have you ever received information about how to make your family and home safer from natural
disasters? [if no then go to question no.5]. yes No

4. How recently?
Within the last 6 months
Between 2 and 5 years
Between 6 and 12 months
Between 1 and 2 years
5 years or more

5. Are you aware about disaster insurance? [if no then go to question no.11].
Yes No.
6. Does your family have any disaster insurance coverage? [ if no then go to question no.9].
Yes No
7. Do you have the insurance coverage any of the following.

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 Earth quake Land slides
Flashflood Avalanche
Others-specify……………………………
8. Name of the company.
General insurance corporation of india
New india assurance
Oriented insurance
United india insurance
Other- specify……………………………..
9. What is the main reason that your family doesn’t have insurance coverage against disaster.
Not easily accessible
Too expensive
Not necessary
Never considered it
Other

[Please specify your level of agreement for the following statements(just put a tick mark). SD-
strongly disagree, D-disagree, U-undecided ,A-agree, SA-strongly agree]

10. Disaster insurance is effective to recover the damages caused by natural disaster.

SD D U A SA

11. Govt. of Uttaranchal should take some initiative to improve the awareness of disaster insurance
of the state.

SD D U A SA

Other comments::
………………………………………………………………………………………………………………………
………………………………………………………………………………………………………………………
………………………………………………………………………………………………………
…………………………………………………………………………………………………………………

Thank you very much for providing these informations

AbbreviationS::
IAY – Indira Awas Yojana
ARMVs – Accident Relief Medical Vans
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BIS – Bureau of Indian Standards
CBOs – Community Based Organisations
CBRN – Chemical, Biological, Radiological and Nuclear
CCMNC – Cabinet Committee on Management of Natural Calamities
CCS – Cabinet Committee on Security
CSR – Corporate Social Responsibility
DDMA – District Disaster Management Authority
DM – Disaster Management
GIS – Geographic Information System
GoI – Government of India
GPS – Global Positioning System
HLC – High Level Committee
MHA – Ministry of Home Affairs
NCC – National Cadet Corps
NCCF – National Calamity Contingency Fund
NCMC – National Crisis Management Committee
NDEM – National Database for Emergency Management
NDMA – National Disaster Management Authority
NDMF – National Disaster Mitigation Fund

References::
 http://ndmindia.nic.in/EQProjects/Disaster%20Management%20in%20India%20-
%20A%20Status%20Report%20-%20August%202004.pdf
 http://www.azadindia.org/social-issues/poverty-in-india.html
 http://ncw.nic.in/pdfreports/Gender%20Profile-Uttaranchal.pdf
 http://www.afminetwork.org/fichiers/ressources/18.pdf
 http://www.proventionconsortium.org/themes/default/pdfs/IIASA_microfin_draft.pdf
 http://www.ccsindia.org/ccsindia/policy/live/studies/wp0010.pdf
 http://www.gdrc.org/icm/disasters/disaster.pdf
 http://www.duryognivaran.org/documents/country%20papers/India%20Country%20Paper.p
df
 http://planningcommission.nic.in/aboutus/committee/wrkgrp11/wg11_disastermg.pdf
 http://en.wikipedia.org/wiki/Avalanche
 http://en.wikipedia.org/wiki/Cyclone
 http://en.wikipedia.org/wiki/Flash_flood
 http://en.wikipedia.org/wiki/Drought

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 http://en.wikipedia.org/wiki/Climate_of_India
 http://saarc-sdmc.nic.in/pdf/publications/sdr/chapter-13.pdf
 http://nidm.gov.in/idmc2/PDF/Outcome/Manmade.pdf
 http://www.gisdevelopment.net/proceedings/mapworldforum/sem5/MWF_sem5_Disaster
Management_131.pdf
 http://india.gov.in/citizen/agriculture/natural_schemes.php
 http://en.wikipedia.org/wiki/Category:Earthquakes_in_India
 http://www.sristi.org/dmis/plan_manage
 http://www2.unescobkk.org/elib/publications/103/disaster.pdf
 http://data.undp.org.in/dmweb/pp/UNDP_IDPR%2045%20Versionweb.pdf 
http://ndma.gov.in/ndma/hr/consultant.pdf

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