CELEBRITY insurance is in with actor John Abraham wishing to insure his butt reportedly

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for Rs 10 crore, but insurers appear to be divided on providing such covers.

While public sector insurers are open to the idea of providing such covers there appears to be hesitancy among a section of insurers to get involved in such covers. Those unwilling give the reason that domestic nonlife insurance companies do not have the underwriting expertise to design such a cover and would completely depend on foreign reinsurers to provide it.

Government owned insurance companies such as New India Assurance, United India Insurance and private insurer ICICI Lombard have said that they may consider providing such a cover.

However, private insuers such as Bajaj Allianz General, Tata-AIG General, Royal Sundaram said that they have not sold such covers and would not look at providing celebrity insurance covers. They would rather provide a personal accident policy that would cover the financial loss due to disability from an accident.

So what does a celebrity insurance policy cover? The policy would indemnify the business loss to a celebrity for that part of their body or talent that is important for their business. Foreign reinsurers would look at the health of celebrity, his popularity, his balance sheet and earnings from the talent or body part that he wishes to insure, the kind of sport or art he is in and the risks surrounding the celebrity.

So, many in Western countries have insured their voice, sportspersons their legs and arms while actors have insured their smile, face or specific body parts.

However, unlike in the Western countries, in India the trend is yet to begin. A key reason is that Indian insurers do not have the expertise to design a celebrity insurance cover and would have to get it designed from foreign reinsurers, mostly Lloyds of London.

G Srinivasan, CMD of United India Insurance, said, “There have not been any serious proposals from celebrities asking for body insurance covers. We can consider providing such a cover, but we first have to check with foreign reinsurers who will look at the risks involved, the contingencies, besides other factors such as the amount of cover being asked is appropriate or not.”

M Ramadoss, CMD of New India Assurance, said, "If a celebrity wants such an insurance, then we will send his proposal to foreign reinsurers who will evaluate the request and put the terms, conditions and decide the premium."

However, explaining the reason for hesitance among other segment of insurers, vice-president of Prudent Insurance Brokers, Pavanjit Singh Dhingra said, "Celebrity insurance is a very niche segment. There is no reinsurance capacity for such covers in India. Also very few foreign reinsurers offer such covers."

Director retail at ICICI Lombard General insurance, Neelesh Garg, said, "We sell one or maximum two such policies in a year on a case-to-case basis. There are specific events under which a celebrity's talent or specific body parts are covered. These policies are not popular in India. Since we do not have the underwriting experience, these are underwritten by Lloyds of London. The premium is very high and varies from 1 per cent to 5 per cent of the sum insured depending on the various risk factors.” Official of Bajaj Allianze said on conditions of anonymity, “We would sell our personal accident cover to the celebrity and are not looking at providing these exitic covers.” A Tata AIG official also that they offer personal accidents covers that will insure the celebrity against any injury to any of his or her body parts due to accident.

Efforts to get in touch with John Abraham did not yeild results.