Skip to main content

RERA Creates a Rs10k-cr Business for Cover Firms

By
RERA Creates a Rs10k-cr Business for Cover Firms
 
TITLE INSURANCE for all projects was made compulsory for builders under the Realty Act
 
The Real Estate Regulatory Act (RERA) has made it compulsory for developers to get title insurance for all projects, opening a new segment of over Rs 10,000 crore for insurance companies.
 
Insurance companies have so far not covered land transactions and they say the reason for missing cover is unreliable land records, which can be challenged.
 
After the implementation of Rera, it is mandatory for developers to provide written affidavit to the buyer stating that the legal title to the land contains legitimate documents of ownership. This policy covers buyers of property against loss and settlement costs, litigation funds arising from problems in the land title discovered after purchase. HDFC Ergo and SBI General are working on launching title insurance policy.
 
“As per Rera, every builder will have to buy title insurance and we expect the entire potential in terms of premium to be ?10,000 crore,” said Anurag Rastogi, member of Executive Management - HDFC Ergo. “Demand has always been there but there was no regulatory requirement.”Sum assured for title insurance will be the value of the property. Five -six large builders have shown interest in buying title insurance to cover loss of property and cover the legal expense in case of faulty land records.
 
Given the lack of records, title insurance may not become a big segment just yet.“Most land records and manuals and are yet to be digitalised. The ecosystem is yet to mature and given the existing problems with land records, implementation of title insurance could still be difficult and could take up to two-five years for Rera to be fully implemented nationwide,” said Pushan Mahapatra,CEO, SBI General Insurance Company. “Large developers, financiers would like to buy title insurance.”
 
Mostly, it will cover issues arising out of forgery and fraud or claims arising out of documents not created properly. Interestingly, if property value appreciates, the policy will increase the limit of indemnity.
 
The Economic Times, New Delhi, 27th March 2018 

Comments

Post a Comment

Popular posts from this blog

Data storage norm splits digital payments industry

By
Data storage norm splits digital payments industry  India’s nascent digital payment industry could be thrown into disarray due to the demand by the Reserve Bank of India (RBI) that all user data be stored within the country, fears an industry grouping, which has termed the decision as “heavy-handed”, even as others, including the country’s largest digital payment provider Paytm, have hailed the move.  In a bid to narrow the growing schism, the industry is planning to send a formal representation to the regulator highlighting its concerns, a top official told ET.  “We are trying to build a consensus on the issue," said the person adding that the representation to the central bank will be ready this week.  RBI on April 6, mandated all payment companies—global and local—to set up data storage facilities within India by October. The stringent six-month deadline has attracted the ire of several sections of the industry that fear it will lead to a disruption of wel...
18 comments
Read more

Offer’s for all of you

By
Great Bumper Dhamaka Offer’s for all of you... It's Time to see your Business Online, WebeCreator Offer Website Designing with domain & Email @ nominal charges. For a year For More information visit us http://goo.gl/KlpppF call on 9890151261/9773197533  drop a mail to sales@webecreator.com
Post a Comment
Read more

Sebi to finalise options in commodities today

By
The Commodity Derivatives Advisory Committee of the Securities and Exchange Board of India ( Sebi) will meet on Friday with senior officials of the latter, to give a final shape to the rules on options trading in commodity futures, beside revising the warehousing norms to ensure good delivery on settlement. The decision taken, after discussing with the advisory committee, will be placed before the regulator’s board, to finalise the regulations. According to knowledgeable sources, three commodities in each segment, agricultural and non- agricultural, have been proposed for introducing options. It appears commodities from the soya and guar segments are preferred in the former. From the non- agri segment, it is likely that gold, silver and crude oil will be finalised. All these These have better liquidity and both the National Commodity and Derivatives Exchange and the Multi Commodity Exchange, respectively, will be able to introduce the options. In the equity segments, options ar...
17 comments
Read more