The final one-day international (ODI) cricket match between India and Australia, which was abandoned due to rains on Wednesday, might leave Oriental Insurance Company poorer by up to Rs 6 crore. The Mumbai Cricket Association (MCA), the host of the final ODI in the seven-match series, had bought an insurance cover from Oriental Insurance for losses on cancellation of the match due to natural phenomenon, terrorist attacks, communal violence and various other causes.
On Wednesday, cyclone Phyan that passed off Maharashtra coast brought heavy rainfall in the coastal areas leaving the ground at D Y Patil Stadium in Navi Mumbai wet and soggy. After the umpires inspected the ground and found it unfit for playing, the match was called off in the evening. A cyclone alert was sounded by the India Meteorological Department across coastal areas in north Maharashtra and south Gujarat in the wake of a deep depression over the Arabian Sea.
According to Reena Bhatnagar, deputy general manager at Mumbai office of Oriental Insurance, the match was insured for a total of Rs 6 crore, including Rs 2 crore as gate money (ticket sales), Rs 3 crore for advertising revenue loss and Rs 1 crore for match expenses incurred. “There is definitely a claim that is payable under the policy but we have not been intimated by MCA yet,” Bhatnagar told Financial Chronicle.
This is the first claim for MCA though Oriental Insurance, which had paid claims on two occasions earlier when matches were called off during the Indian Premier League (IPL) tournament and once when an India-West Indies match was called off. The Irda allows general insurance companies to insure matches held outside India if the insured is an Indian party.
The Board of Control for Cricket in India (BCCI) generally insures all players and broadcasters even for overseas matches. The host of the match has to insure the match, like MCA did. According to Bhatnagar, BCCI had bought a Rs 40 crore cover for the entire seven-match series in name the broadcaster, Nimbus Communications.
Bhatnagar said once the claim is filed with them, the certified assessor will assess the loss on books and then the claims will be settled. Since the tickets are already sold and the money is non-refundable to the buyers, the insurance company might exclude that from the claim.
New Delhi: State-owned Oriental Insurance Co. Ltd will be paying Mumbai Cricket Association, or MCA, for the cancellation of the 7th one-day international cricket match between India and Australia at DY Patil Sports Academy grounds.
The match was called off due to incessant rains as a result of cyclone Phyan but MCA had insured the match against any loss of revenue arising out of cancellation. The cancellation could have been due to natural perils like earthquakes, lightning, storms and floods. Additionally the policy also covered terrorist attacks, airline strikes, death of a national leader, and failure of floodlights.
“This cricket match was insured for Rs6 crore for MCA. Since it is a “one ball bowled” policy, we are liable to pay the claims. However, although the sum insured is Rs6 crore, the amount that we pay up would depend upon the assessment of damage done,” said Reena Bhatnagar, deputy general manager, Mumbai region, Oriental Insurance.
“One ball bowled” policies refer to insurance policies that cover the risk of cancellation of the match till the time a ball is played. Once a ball is played the cover ceases to exist.
The policy covers any revenue loss to MCA on account of refunding the match tickets and in-stadia advertising. Additionally it also covers expenses incurred by MCA to host the match. MCA had also bought a public liability cover of Rs2 crore.
“Since it was a one-day, it can’t be rescheduled. Most probably we will be refunding the tickets of the match. However, whether we would be refunding tickets and paying up the advertisers, the management board has to take a decision. We would be lodging the insurance claim shortly,” said Ratnakar Shetty, treasurer, MCA.
Oriental hopes to settle the claims within 15-20 days from the receipt of all documents by the surveyor. “After MCA lodges a claim with us, we will appoint a surveyor who will go through the extent of losses that was specified in the policy. Once the surveyor gives us an estimate we will move the documents to the head office in Delhi. It shouldn’t take much time after that since it is a fairly simple case,” said Bhatnagar.
deepti.b@livemint.com
Source : http://www.livemint.com/2009/11/11222238/Oriental-to-pay-for-match-canc.html?h=B
Cricket fans were not the only ones left disappointed by the cancellation of the India-Australia one-day international (ODI) match today that was to be played at the DY Patil Stadium in Navi Mumbai. Public sector insurer Oriental Insurance will have to pick up the tab for claims worth Rs 6.75 crore.
While the Mumbai Cricket Association (MCA) had taken an insurance cover for Rs 6 crore against natural perils such as cyclone, lightening, death of a political leader, riots, airline strike, civil commotion etc, the Board of Control for Cricket in India (BCCI) had insured the advertisers and the broadcasters against cancellation due to such events for Rs 75 lakh. This would include the loss of revenue through ticket sales.
The claim comes against the cancellation of the match due to heavy rains. The premium paid for the cover, however, is not known, but it could be in the range of 0.5 per cent to 1 per cent of the sum assured.
A senior executive at Oriental Insurance declined to disclose the premium paid by both MCA and BCCI.
The cricket association had taken an additional cover against terror attacks, but since the match was not cancelled due to terrorist attack or fear of such activity, the insurer would not pay that amount.
Moreover, the risks were not reinsured in this case. The executive added that since the risk was low and within the limit of the insurance company, no reinsurer was roped in.
Oriental Insurance has been aggressively writing covers for cricket tournaments. Recently, it has covered all matches of the International Cricket Council’s T-20 World Cup. Of late, the public sector insurer had started covering broadcasters too. During the Champions Trophy, it had provided a cover of Rs 148 crore to ESPN India against revenue loss due to match cancellations.
Source : http://www.business-standard.com/india/storypage.php?autono=376135
