KBC insured

In an industry that thrives on high television rating points (TRPs) and endorsements, the game show KBC, also popularly known as Kaun Banega Crorepati Season 5, has inflows from an additional source.
It earned close to Rs1 crore by taking an over- redemption policy with National Insurance Company (NIC). This policy, which forms a part of wagering insurance, includes commercial contracts of insurance or contracts which deal in futures and options. Some experts also define it as a gambling or betting activity.

KBC purchased this policy by paying a one-time premium of Rs7.5 crore to NIC, in anticipation that they would give out prize money worth Rs7 crore and more. NIC decided to cover their risk because they believed KBC 5 wouldn’t cross the Rs7 crore mark.

KBC was confident of giving out prize money worth Rs7 crore and more, but it didn’t include the prize money given to the 10 invited celebrities, who took more than Rs1.2 crore worth of prize money.


The contract also suggested that Rs7 crores of prize money that KBC gives away will include only sums of Rs50 lakh, Rs1 crore and Rs5 crore. Players taking home anything below these will not be included in the amount of Rs7 crore.

The wagering agreement between KBC and NIC said if the latter loses to KBC’s skepticism then in such a case, NIC would pay KBC a maximum sum assured of Rs9 crore as its upper limit. However, the amount claimed was Rs8.5 crore by KBC as the decision fell in their favour.

“Our prediction went wrong and hence, we will pay KBC around Rs8.5 crore. But, our loss is negligible as we recovered this amount by investing Rs7.5 crore for a long period,” said a senior official from NIC. KBC paid NIC Rs7.5 crore premium early this year, whereas NIC is likely to pay them claims before this year end. With this, NIC committed their entire loss was not more than Rs5-6 lakh because they got to invest Rs7.5 crore (premium paid by KBC before the show could start) in various instruments available in the market for a period of more than six months. With this, they recovered Rs8.5 crore (sum assured that they have to now pay to KBC.)

Such over redemption policies taken, come under the umbrella of wagering insurance. In other words, the amount of money made under such contracts or agreements are known as insurance.

When asked about KBC’s quiz show being authentic, reliable and reality based, the official from NIC said, “We took the plunge because the game is trustworthy and not one of those which can be manipulated.

Last year also nobody won Rs5 crore bonus amount, hence, we thought it was worth taking the risk in this season.”

Here, the risk taken for KBC was shared by NIC, United India Insurance (UII) and ICICI Lombard in the ratio of 60:20:20. However, NIC acted as lead insurer because they took 60% of risk exposure. KBC has won the bet, so ICICI Lombard and UIA will also have to pay the sum assured.

Since the entire premium was paid to NIC alone, it will pay the claim of Rs8.5 crore and recover amounts from UII and ICICI Lombard in stipulated ratios of 20:20.

The decade-old reality show, for the current season, opened with approximately 5.4 TVR (television viewer ratings) points and experienced its highest rating of 8 TVR points when Sushil Kumar won Rs5 crore which was the highest prize money set by KBC since season 4. Approximately 27 million people watched this show.