Gammon denies insurance claim

Gammon India on Thursday said that it had not claimed insurance for the portion of the flyover under construction which collapsed last Sunday in Hyderabad. Company sources said that “we have not claimed for insurance. There is no question of claiming insurance.” A news channel had said that their claim for insurance had been rejected. A company source said that it was only one span, a small portion that had caved in.
The company has insurance for Rs 30 crores. The insurance company ICICI Lombard did not wish to comment on the issue on grounds of “client confidentiality.” But it said that there were exclusion clauses in a typical general contractor all risk (CAR) policy. The spokesperson said it is a general contract and is available on their website.
According to the CAR an insurance claim can be rejected if there is a design defect or wilful negligence on the part of the contractor or a faulty workmanship. If one of these reasons is there, insurance claims can be rejected. The reasons for the collapse is still a matter of investigation so it is too early to say whether any of the three reasons could apply in this case.