Lapses in claiming insurance, Supplyco suffers Rs 113 cr loss
Thiruvananthapuram: The Kerala Civil Supplies Corporation known as Supplyco has suffered a huge loss of Rs 113 crore after the officials failed to get the insurance claim of the rice and paddy which was destructed in the floods. As the corporation is already in financial crisis, the denial of insurance claim also made Supplyco face another setback.
Food grains worth Rs 163 crore were destructed in the deluge. But the insurance company only paid Rs 25 crore as insurance claim. The corporation suffered a loss of Rs 113 crore due to the failure to demand the claim on time.
At the same time, Supplyco earned Rs 24 crore from the sale of the damaged grains to fodder manufacturing company.
Though there are many complaints regarding this, the government has not initiated a probe into it. It is alleged that conspiracy between officials, people who are close to Chief Minister’s office, rice mill owners and Insurance company owners led to the huge loss to Supplyco.
Meanwhile, sale in 1500 Supplyco stores was also affected as there is no more stock to supply. It is reported that the corporation failed to ensure supply due to the loss of Rs 431 crore from subsidy and Rs 135 crore marked as consolidated loss.
Delay to apply for insurance claim
Supplyco has insured 1.09 lakh food grains in 51 mills for Rs 273 crore through United Insurance Company before the floods.
The first premium of Rs 4.45 lakh was paid on August 8.
Supplyco has informed the insurance company that the food grains were damaged in the floods multiple times from August 16 to 18 and on August 21. But they filed the application requesting insurance claim only after two months from the floods.
In a letter to the insurance company dated October 1, Supplyco informed the company that food grains worth Rs 163 were damaged in the floods and 75 percent of the insurance claim that is Rs 123 crore should be granted immediately.
Meanwhile, the loss from the damage of food grains came down to Rs 131 crore in another letter send on October 10.
The Supplyco officials have no idea on the change in the estimated loss that marked a reduction of Rs 32 crore.