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Tuesday, May 31, 2011 12:40 PM]
LIC International, a subsidiary of Life Insurance Corporation of India, has brought a unit linked insurance plan ‘Gold Plus’ in the market.
In Gold Plus, customers can invest in gold spot and gold exchange traded fund and can get the benefits of the increase in gold prices in future.
The policy is available for age group of zero to seventy-two years and the term is from five to thirty-five years. The mode of payment is yearly, half-yearly or quarterly and also has an option of single premium. The minimum premium is $1000 for single mode and annual premium mode. The maximum premium is $10 million for single premium, and $1 million per annum for regular premium.
In case of the demise of the insured, the sum assured with fund value is paid to the nominee. In accidental death, additional sum assured is also payable if accidental rider is availed. Partial withdrawal facility is available. The policy can be liquidated after one year from the date of start.
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Monday, May 30, 2011 11:27 AM]
India’s life insurance industry is desperately seeking to find a proper marketing formula to boost its profitability. Almost a decade has gone by since this sector was privatized, yet for most of the life insuring companies, profits are still a distant dream. Most of the insurers have yet to achieve the break-even point.
As per an IRDA report, India has about 32.5 crore insurance policies, one of the highest in the world. However, the total losses of the top ten private insurers in the past ten years are above Rs. 16,000 crore. Right now the biggest issue in front of the industry is to find a proper distribution channel to convert its low productivity into profit.
Most of the insurance companies are struggling to increase productivity beyond Rs. one lakh of premium collected per month per sales manager. However, according to experts, to break-even, the industry needs Rs. two to three lakh per sales manager per month.
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Sunday, May 29, 2011 11:26 AM]
Dinesh Kumar Mehrotra, one of the LIC's MD was chosen to act as interim chairman of the India’s biggest insurer, Life Insurance Corporation on Thursday. He will be holding this position for a time period of three months or until further notice, which so ever is earlier.
The uncertainty began when in an unexpected move, the finance ministry removed the chairman of LIC, T. S. Vijayan whose five-year tenure as LIC chairman finished early this month. The committee to select a chairman had suggested a two-year extension for T.S. Vijayan. However, the Central Vigilance Committee (CVC) refused to clear his name as he along with a few other managing directors was indicted in a case.
In the meantime, Rakesh Singh, chairman of NABARD and also holding the post of the additional secretary in the department of financial services) was appointed as chairman until a new person was found.
D. K. Mehrotra started his office from 27th May. Mehrotra joined the company in year 1977. He held the position of the executive director (international operations) and was appointed MD in July 2005.
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Saturday, May 28, 2011 1:57 PM]
India’s public sector insurer, Life Insurance Corporation is once again applying for a licence from the Singapore government to open its subsidiary in Singapore. In year 2009, Singapore government had turned down the LIC’s application as the LIC did not have an international credit rating.
Now, the insurer has obtained a rating from the Global ratings agency Moody's Investors Service. Moody’s has allotted A3 for short-term and BBB for long-term. A3 rating judges obligations as ‘upper-medium grade’ subject to ‘low credit risk’. BBB rating judge obligations as speculative and subject to high credit risk.
Moody’s upgraded India’s sovereign local currency from Ba2 to Ba1 in July, 2010, recognizing India's pledge to fiscal and economic reforms. This rating judges a country's political and financial mood, and indicates its capability to repay loans. This up-gradation has improved the trust of investors in the country's economic system.
Presently, LIC has a representative office in Singapore, but with the Moody’s rating in place, the company is ready to apply for a licence to set up the subsidiary. The benefit LIC has over other insurers is that the Indian government guarantees every policy issued by it.
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Friday, May 27, 2011 11:54 AM]
Zero depreciation policies are the latest fab in motor insurance and are slowly turning out to be a hit within top and mid segment cars. These policies are also known as zero percent depreciation covers. As opposed to comprehensive cover, this cover offers full settlement without any write-off for depreciation. Normal motor car policies pay only 50 percent of Plastic/Rubber parts and 5 to 50 percent deduction on metallic parts in accident claim. The only downside to these policies is that they cost a bit more than the normal policies.
IRDA allowed these policies to make their entry into the Indian market about two years ago. The reason behind the success of these policies is that in standard motor policies the customer has to pay a big amount for fixing fibre and plastic parts and in the case of old cars, a hefty portion of the repairing cost has to be borne by the customer since his vehicle’s old parts are replaced by new parts.
The zero depreciation policy compensates the claim fully for a premium amount which is around 20 percent higher than the normal cover. Despite the benefits and raising sales of zero depreciation policies, majority of the car owners are not aware of this policy.
Many customers after coughing up big amounts towards repairs of their car were upset when they came to know about this policy. All were of view that they should have been told about it and were willing to purchase it in spite of it being costly.
Tata AIG was the first insurance company to get the go ahead from IRDA to provide this insurance plan with Zero Depreciation to its customers. Presently, many insurance companies in India are offering this policy to their customers and others are in the process of offering it in the very near future.
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Thursday, May 26, 2011 12:24 PM]
The last decade saw a boom in the life insurance industry with its total assets over Rs. Fourteen lakh crore, a growth of 700%. This financial year, the industry is expecting a growth of 15% as it equilibrates the challenges of profitability and growth.
Recently, Life Insurance Council organized a conference of industry CEOs in Hyderabad, where the industry bigwigs concurred that growth would be about 15%. The Council is now in the process of drafting a white paper highlighting how the life insurance industry will develop in the next decade.
MD of SBI Life, M. N. Rao said, “The new business premium of the life insurance industry should grow by 10-15% during the current fiscal. But the big challenge for insurers would be to ensure that all their earlier policies are renewed. It is an acknowledged fact that renewal premium will be the main driver of profit."
During last financial year, the life insurance industry raised its premium collection from new policies to Rs. 1.25 lakh crore from Rs. 1.09 lakh crore. In this the major share was of LIC. Private life insurers collectively registered a negative growth.
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Wednesday, May 25, 2011 12:41 PM]
Punjab National Bank (PNB) is in the final stages of purchasing almost 33% stake in MetLife India Insurance Company Ltd. The move will enhance nationalized bank’s fee income and allow the private insurer to avail the facilities of second largest financial distribution network in India.
PNB is rated as the second largest bank in the country after State Bank of India in terms of number of branches. MetLife India Insurance Comp. Ltd. is a joint venture between MetLife International Holdings, Inc., M. Pallonji and Co. Pvt. Ltd. and the Jammu and Kashmir Bank and is one of the fastest growing life insurers in the country.
An insider intimate with the negotiations said, "PNB is in talks to pick up to 33% stake in MetLife, the deal may be finalised in the next few days." But there is an uncertainty about the deal as the negotiations involve many parties such as Jammu & Kashmir Bank and Shapoorji Pallonji & Company. There is no certainty that the transaction will take place. MetLife MD Rajesh Relan said, "We are one of the three short-listed companies by PNB as per their process and the discussions with the management are yet to begin."
Also, nobody from PNB was willing to comment on the deal either. "It would be premature to say we have zeroed in on MetLife. The bank will take a final decision based on the financial valuation report," said PNB executive director M. V. Tanksale.
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Tuesday, May 24, 2011 12:41 PM]
For an insured person, settlement of insurance claim is his biggest concern when he needs it. An individual purchases life insurance so that his family members and loved ones are financially secured just in case something unfortunate happens to him. However, if the claim gets refused, the financial security of his loved ones is threatened. All insurers have different statistics of claims settlement which can be explained by Claim repudiation ratio.
Claim repudiation ratio can be defined as the number of claims rejected (calculated in percentage) by the insuring company. A claim repudiation of 30% would mean that out of every 100 claims, 30 claims have been rejected by the company.
As per the data from industry sources, LIC of India still remains at the top in settling insurance claims. During financial year 2010-11, LIC settled 99.6% of the total claims and 95% death claims were adjudicated inside fifteen days of intimation. Adding together, the PSU insurer settled roughly 18 million claims totalling to Rs. 53,000 crore, including maturity, survival benefits and death claims. Out of this, 721,000 death claims were settled for Rs. 6,000 crore.
Among the private insuring companies, HDFC Life settled around 96 % of the total death claims, while ICICI Prudential settled about 94% of total claims. Among the new private players, the ratio is on the higher side. For example, repudiation ratio for IDBI Federal Life, which started its operations in 2007, was 21% and for India First Life, which started out in 2009, the ratio is 9.4%.
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Monday, May 23, 2011 11:55 AM]
IRDA is set to surrender its financial autonomy to government in the very near future. The funds of both the Insurance Regulatory and Development Authority (IRDA) and Securities and Exchange Board of India (SEBI) are to be maintained in the Public Account.
According to the sources, both the regulators are in the final stages of forfeiting their financial autonomy. The regulators have funds of nearly Rs. 2,000 crore between them. The government wants to merge the funds with its own accounts and is of the view that the IRDA and SEBI should get whatever financing they need from it.
Previously, the regulators have taken the stand that the loss of financial liberty would affect their working significantly.
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Sunday, May 22, 2011 11:51 AM]
Insurance Regulatory and Development Authority of India is facing an acute shortfall of skilled actuaries. Member actuary, S. Kannan is going to retire this month and with no applicant in sight for the position, the industry experts fear that various crucial regulatory functions may suffer.
Actuaries are statisticians or somebody knowledgeable in the collection and interpretation of numerical data, particularly an individual who uses statistics to calculate insurance premiums. Actuaries’ services are needed in determining prices of products, valuation of businesses and presumption of future profits.
Some weeks ago, IRDA had advertised for the placement of the member actuary, but it has yet to receive a response. The position of the member actuary is equivalent to the rank of the additional secretary and is regarded as the second-most powerful position in the office of IRDA.
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Saturday, May 21, 2011 11:46 AM]
Recently, Life Insurance Corporation of India (LIC) introduced a software by the name of “E-FEAP” to increase its efficiency and make its offices paperless. E-FEAP, developed by Wipro, was first introduced by LIC in Mumbai. A trial run of the software by LIC in its Bangalore branches showed many glitches, but the LIC authorities installed the software in all LIC offices without correcting the errors.
On Friday, there was bedlam in Indiranagar and St Mark’s Road branches as customers were left stranded, due to a glitch in the software. An LIC officer stated, “The whole idea of the new software was to go paperless. But thanks to E-FEAP, paper work has increased and customers are inconvenienced.”
One senior LIC officer formulates a potential worst-case backdrop that the software bug may breed: “Suppose a policy holder comes to pay his premium on the last date of the grace period – 30 days is given as a grace period after the due date to pay premium – and is sent back without accepting the payment due to slow network. If the policy holder dies the next day, his premium payment would not be up-to-date in LIC’s books. Thus, the policy holder’s family will not get 100 per cent of the insurance claims. If the policy is less than three years, no claims are given.”
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Friday, May 20, 2011 11:25 AM]
Star Union Dai-ichi Life Insurance Co. Ltd. is planning to aggressively spread its presence in southern India by opening more back-end offices for customer support. SUD Life is preparing to open around dozen area offices in the coming nine months. Presently, it is operating four regional offices in south at Bangalore, Chennai, Hyderabad and Kochi and 1,150 branches of the partner banks. The company is planning to establish a total of sixty area offices throughout the country in two phases.
Recently, Star Union Dai-ichi Life (SUD Life) launched two new insurance plans, one in the traditional category named 'Growth Endowment Plan' and another in ULIP segment, by the name of “Dhan Suraksha Express”.
SUD Life has become the first life insurer in India to collect about Rs. 1329 crore in new business premiums in its first twenty-six months of operations. During the fiscal year 2010-11, the company has procured about Rs. 758.00 crore new business premium, a growth of 46 percent over the last fiscal year. The life insurer has covered 353,994 lives under group schemes and sold 97,730 individual policies.
Star Union Dai-ichi Life is a joint venture between Dai-ichi Mutual Life Insurance Company of Japan and leading Indian public sector banks, Union Bank of India and Bank of India.
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Thursday, May 19, 2011 11:15 AM]
Jadavpur University, rated one of the top five universities in India, has collaborated with International College of Financial Planning (ICoFP), one of India’s foremost institution for careers in financial services, to start financial courses.
Students from the eastern part of India can now take courses in Banking, Financial Services and Insurance (BFSI) sector and launch their career in the financial sector. The Centre for Rural and Cryogenic Technologies, through its partnership with ICoFP would provide job oriented courses to students under the supervision and direction of Jadavpur University. The course will be called “Post Graduate Diploma in Financial Planning (PGDFP)”, which will be collectively certified by Jadavpur University as well as ICoFP.
The duration of course PGDFP is full time one year. The course programme includes specialized subjects like Insurance Planning, Financial Planning, Tax Planning, Risk Analysis, Securities Research, Mutual Funds, Equity Derivatives Commodities Derivatives, etc. and extra subjects like Micro insurance, Microfinance, Social Entrepreneurship, Rural Banking, etc.
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Wednesday, May 18, 2011 11:33 AM]
Private insuring company IDBI Federal Life has launched a new single premium ULIP product by the name of “Retiresurance Milestone Pension Plan”. The product is launched keeping in view the vast potential of post retirement needs of the today’s generation and to insure against potential future shocks. This unit linked pension plan helps wealth building by giving an option of guaranteed investment options for an insured life after retirement.
The product has two investment alternatives, first is Guaranteed Return Funds - Pension, which targets a minimum assured maturity value per unit and invests in fixed income instruments and second is Guaranteed Growth Funds - Pension, targeting to give the minimum Guaranteed Maturity Value per unit via investments in debt instruments and also increase returns by investing a small portion in equity.
M.D & C.E.O of IDBI Federal Life Insurance, G. V. Nageswara Rao, said, “India’s population is predominantly young. With the increase in life expectancy, many Indians could be spending a good 20 to 25 years of their life in retirement. While the talented younger generation works hard to meet the increasing cost of living, we at IDBI Federal visualise this generation’s dire need for building wealth to support their standard of living post-retirement as well. This also assumes significance in view of the fact that many of the Gen-Next jobs are contractual by nature and the youth does not enjoy the benefits of traditional options like a Provident Fund.”
IDBI Federal started its business in March 2008, and today it is one of the fastest growing insurance companies in India. It has issued about 2,92,000 policies and a Sum Assured of Rs. 163.84 billion. It has launched various innovative plans like Homesurance, Wealthsurance, Microsurance, Bondsurance, Incomesurance, Termsurance, Healthsurance and the latest Retiresurance.
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Tuesday, May 17, 2011 10:56 AM]
Rajnikanth has always been a sure bet for insuring companies. The legend has yet to give a flop, thanks to his millions of diehard fans. There has been never a problem for his movies to get insured, but this time, the superstar is having troubles for getting his latest movie “Rana” insured.
All the insurance companies were keen on providing insurance for Rajinikanth's latest flick “Rana” after the super-duper box office triumph of Enthiran (Robot). However, now following reports about megastar’s star's health problems and his numerous hospital visits, the insurers are having second thoughts.
As per a report by a Hyderabad based financial newspaper, United India Insurance and New India Assurance, which insured Enthiran, are not willing to cover Rana.
A New India Assurance official was quoted as saying, "Considering that the actor has been going in and out of hospital and with so many rumours floating about his ill health, it is a very risky proposition to provide insurance cover for the film. We will not consider it.”
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Monday, May 16, 2011 11:19 AM]
Rashtriya Swasthya Bima Yojana (RSBY), the government’s health insurance scheme for people below poverty line (BPL), is in problem as many state governments has yet to pay their dues to insurance companies. According to insurers, about Rs. 250 crore premium is pending with state governments.
The scheme was formally inaugurated on October 1, 2007 and became functional on April 1, 2008. Hitherto, the RSBY is running in twenty-five states more than 9 crore people have been insured. This scheme allows for Rs. 30000 hospitalization charges for a family of five.
Insuring companies and their TPAs have complained to the central government about payment delays. Anil Swar¬up, joint secretary in labour and employment ministry, said, “Delay in payments to insurers is a problem. It happens as the payment has to be made in advance and also since RSBY has expanded very fast. The bu¬dgetary requirements have increased and processes take time. However, in so¬me cases, 100 per cent premium has been received by insurance companies yet the claims are not settled to hospitals.”
“The central government has just recently cleared all pending bills of insurance companies. It is now only the dues from the state governments that are pending,” added Swarup.
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Sunday, May 15, 2011 11:15 AM]
IndiaFirst Life Insurance is planning to infuse Rs. 120 crore in the business to support the company’s expansion plans and meet the solvency cap requirements. This is the third time the company is infusing the capital since its inception. It will take up company’s total share capital to Rs. 550 crore from Rs 430 crore.
MD and CEO of the company, P Nandagopal said, “Despite the challenges faced by the life insurance industry and the new investments coming in, the company is confident of achieving breakeven by 2014 as targeted or even before that.”
“We plan to increase business from our agency channel to at least 30 per cent of the business in the next two to three years. We plan to recruit 5,000 agents each in the next two years to take up our total agent network to 10,000 by the year 2014,” Nandagopal added.
IndiaFirst Life Insurance is the youngest life insurance company in India. It is a joint venture between UK's leading financial institution, Legal & General and India’s leading banks, Andhra Bank and Bank of Baroda. Bank of Baroda holds a 44% stake, while Andhra Bank and Legal & General hold a 30% and 26% stake respectively in IndiaFirst.
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Saturday, May 14, 2011 11:39 AM]
ICICI Lombard, India’s biggest private sector General Insurer has partnered with Air India Express to provide cost effective travel insurance solutions to Airline’s domestic and overseas travellers.
You can buy the e-policy from the airline’s website www.airindiaexpress.in at the same time while booking tickets. The e-policy is issued immediately without any formalities with straightaway verification through SMS and email.
The policy covers a multitude of predicaments such as loss from trip hold up, loss of passport, medical expenses due to accidents, delay or loss or of checked in baggage, and a great deal more.
“We are committed to delivering unique and convenient risk management solutions to our customers. Our partnership with Air India Express brings together a comprehensive, cost effective travel insurance cover at the time of ticket purchase along with the ease of instant online policy issuance. The product coverage has been carefully designed to meet the needs of Air India Express’ guests and has a convenient claims settlement process,” Neelesh Garg, Executive Director, ICICI Lombard General Insurance said while talking about the tie up.
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Friday, May 13, 2011 11:27 AM]
The government has provided an exemption to insurance companies from filing their annual results in the electronic format XBRL. XBRL stands for Extensible Business Reporting Language. Other sectors excluded are non-banking financial companies, banking and power companies.
Previous month, the Ministry of Corporate Affairs (MCA) had issued a notice to all big companies to file their annual 2010-11 result in XBRL format to ascertain better improvement and transparency in corporate administration.
In a circular issued on Thursday, MCA stated that insurance, banking, non-banking financial companies (NBFCs), power companies and their overseas subsidiaries will be exempted from this system. Other than the above mentioned, all other companies with a paid up capital of more than Rs. 5 crore, or with a turnover of Rs. 100 crore will have to file their annual returns in XBRL format.
Presently, all companies file their annual results with the MCA in an e-form format. XBRL format would allow the users to digitally retrieve data with much more precision.
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Thursday, May 12, 2011 11:36 AM]
Axis Bank has purchased a 4% stake in Max New York Life Insurance Company from Max India for Rs. 72 crore. The bank has acquired the stake at par value and has entered into a ten year tie-up. The bank has obtained required regulatory approval from the Insurance Regulatory and Development Authority (IRDA) and the Reserve Bank of India (RBI).
Max New York Life Insurance is a joint venture between Max India and US-based New York Life International in the ratio of 74:26. Max New York Life holds a share base of Rs. 180 crore and a paid-up capital of Rs. 1,976 crore at the end of FY 2010-11.
Vijay Sarathi, analyst at BNP Paribas said, "Axis Bank does not have an insurance subsidiary. At some point of time, Axis would like to extend activities like ICICI Bank and HDFC that get a significant part of the fee income by selling third party products. This is a small investment so Axis may like to increase stake at some point."
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Wednesday, May 11, 2011 3:35 PM]
On Tuesday, ING Life India announced its plan to launch eight new insurance products in financial year 2011-12. It is preparing to launch two new products in every quarter of 2011-12. The company has posted 13% increment in operating profits in the fourth quarter of FY 2011 and is planning to raise its premium income by 17% in the current financial year.
These results have been achieved at a time when the industry is seeing sharp decline in new business. ING Life India, a part of the Dutch ING Group is in life insurance business in India since last ten years. Till now, the company has issued over million policies and has a staff of over 6500 employees.
Headquartered in Bangalore, ING Life India is currently present in 229 cities across 251 branch offices. In addition, the company distributes its products in several parts of the country through its partner's presence.
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Tuesday, May 10, 2011 1:27 PM]
Dutch financial group Aegon is planning to quit India's mutual fund industry in the very near future. Sources in the mutual fund industry are enunciating that Aegon group no more regards the asset management business fit for its growth plans in India.
Aegon with its venture partner Religare Enterprises has not launched any mutual fund product in India since it received its licence from SEBI in October 2008. Soon after, Religare and Aegon separated. Both of them are continuing as partners in their life insurance venture, Aegon Religare Life Insurance.
Aegon has been looking for a collaborator, particularly a bank, for its asset management business since its breakup with Religare, but had not managed to find one. There is speculation in the industry that the failure to find a JV partner could have led the Aegon to take this step.
Many industry insiders are shocked by group’s group's plan to quit the market, as they feel the company is well equipped to take advantage of the mutual fund business.
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Monday, May 9, 2011 2:36 PM]
India’s private insuring company-HDFC Life has announced premium collection of Rs. 9,004 crore in the financial year 2011. In financial year 2010, the company posted a total premium collection of Rs. 7,005 crore, thus showing a growth of 28.53%. It registered a 36% increase in the renewal premium and a 28.53% growth in total premium in the fiscal year 2010-11.
Among the top five private life insurance companies in India, the company has registered the highest growth of 26% in individual new business in year 2010-11. The company cut down its losses to Rs. 99 crore in 2010-11 as compared to Rs. 299 crore in the preceding financial year and it also reduced its capital expenses from 16% in 2009-10 to 13.5% in fiscal year 2011.
Managing Director and CEO of HDFC Life, Amitabh Chaudhry said, “I am extremely satisfied with our performance in 2010-11. In spite of significant challenges in the market, we responded extremely well and demonstrated significantly better traction than our competitors. Our proactive efforts on gearing up the organization to face challenges in the market reflect in the early signs of adapting well to the new regime. We ranked 1st in H2 FY2010- 11 in individual business in the industry, and we are one of the very few private insurers to achieve positive growth in FY2010-11. Our consistent focus on creating awareness about life insurance as long-term financial instruments has resulted in our customers exhibiting renewed focus on life insurance reflected in our high conservation ratio of 81%.”
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Sunday, May 8, 2011 2:32 PM]
Public sector general insurance company United India Insurance, is aiming towards a business target of Rs. 8,000 crore in the financial year 2011-12. The company has decided to focus on micro, small and medium enterprises (MSME) section and rural market. United India plans to open many more micro offices in emerging rural sector.
The general insurer has announced a profit of Rs. 130.54 crore (after tax) for financial year 2011, ending March 31, 2011. It has declared a business of Rs. 6,376.66 crore during financial year 2011, an increase of 21.71% from Rs. 5,239.05 crore in the financial year 2010.
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Saturday, May 7, 2011 2:29 PM]
Religare Enterprises, one of the India’s biggest financial services group, is set to enter the general insurance market in the very near future. The group is in talks with several foreign insuring companies to form a general insurance company which would be offering general insurance services in India.
Presently, Religare is in the life insurance business by the name of AEGON Religare Life Insurance Company Limited (ARLI). ARLI is a joint venture between Religare, AEGON, an international investment, pension and life insurance company and India’s largest media house, Bennett, Coleman & company.
India's general insurance industry has several public, private and foreign players. There are about two dozen general insurance players in the market. Religare Enterprises was launched by brothers, Malvinder Singh and Shivinder Singh and have an interest in multiple business sectors, including lending, investment banking, brokerage and asset management business. According to Forbes, the brothers are ranked 15th richest in India.
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Friday, May 6, 2011 4:22 PM]
Star Union Dai-ichi Life (SUD Life) has launched two new insurance plans, one in the traditional category named 'Growth Endowment Plan' and another in ULIP segment, by the name of “Dhan Suraksha Express”.
SUD Life has become the first life insurer in India to collect about Rs. 1329 crore in new business premiums in its first twenty-six months of operations. These two products were launched to commemorate this memorable occasion.
During the fiscal year 2010-11, the company has procured about Rs. 758.00 crore new business premium, a growth of 46 percent over the last fiscal year. The life insurer has covered 353,994 lives under group schemes and sold 97,730 individual policies. The company has also improved its ranking from 15th in March 2010 to 12th in March 2011 among the 23 life insuring companies in India.
Star Union Dai-ichi Life is a joint venture between Dai-ichi Mutual Life Insurance Company of Japan and leading Indian public sector banks, Union Bank of India and Bank of India.
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Thursday, May 5, 2011 1:11 PM]
The Lucknow district consumer disputes redressal forum has ordered the general insurance company, New India Insurance to pay a compensation of Rs. 75,000 with interest to a complainant for holding up the accident claim for his truck.
The complainant had submitted in his complaint that he owned the truck bearing number-UP32 Z 0588, and its insurance was valid from March 12, 2003 to March 11, 2004. The truck was insured from M/s New India Insurance Company Limited. On July 20, 2003, the truck met with an accident with another truck and was damaged.
The truck owner spent Rs. 75,000 in getting the truck fixed. However, when he approached the New India Insurance for compensation, the company rejected his claim. After that, he registered the complaint with the forum.
The opposite party, New India Insurance communicated to the forum that at the time of the accident, the aforesaid truck was carrying eleven passengers which is against the conditions of insurance. The insurer also admitted that it had insured the truck.
The forum after hearing both the sides, noted that the complainant had surely spent the amount which he was seeking as compensation on the repair of the vehicle. It also found that accident did take place. Keeping in view the fact that the insurance company accepted that the aforementioned vehicle had been insured by them, the Forum bench observed that the insurer unreasonably rejected the claim.
Therefore, in its order dated April 2006, the forum directed the New India Insurance to reimburse Rs. 75,000 to the complainant. It was further stated that interest at the rate of 9 per cent would be payable to the complainant inside a month of acquiring the copy of the order.
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Wednesday, May 4, 2011 11:53 AM]
In an unexpected move, the finance ministry has decided to remove the chairman of Life Insurance Corporation (LIC), T. S. Vijayan whose five-year tenure as LIC chairman finished on Tuesday. He has been offered the post of managing director. The move is seen by industry insiders as a demotion.
Although Vijayan completed his five-year term as chairman of LIC on Tuesday, he had two more years until retirement and therefore, was likely to get an extension.
The government has started looking for a new chairman for LIC-the country's biggest investment institution. In the meantime, Rakesh Singh, chairman of NABARD and also holding the post of the additional secretary in the department of financial services) will function as chairman until a new person is found.
The committee to select a chairman had suggested a two-year extension for T.S. Vijayan. However, the Central Vigilance Committee (CVC) refused to clear his name as he along with a few other managing directors was indicted in a case.
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Tuesday, May 3, 2011 1:15 PM]
With the death of Osama bin Laden, insurance companies are hopeful of lowering of terror insurance rates. Historically, liquidation of terror bigwigs always has a dampening effect on terror activities. However, insuring companies are reluctant to say anything on the immediate effect of Osama’s death on lowering of terror insurance rates as there is some apprehension over the likelihood of possible reprisal attacks.
Terrorism insurance is an insurance product that covers potential losses and liabilities that might take place on account of terrorist activities. It is a difficult product for insurers as the probability of terrorist acts are hard to predict. This policy is exclusively an add-on cover which can be only purchased with the fire insurance policy cover.
India is far ahead of western countries when it comes to terrorism insurance. After the 9/11 attacks on the US, the Indian general insurance companies had set up an autonomous terrorism pool. This terrorism pool is basically funds collected from all insuring companies to compensate potential future losses springing up out of such terrorist activities. In contrast, western countries had to depend on administrations to establish a separate terrorism pool to take care of probable eventualities.
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on
Monday, May 2, 2011 2:18 PM]
India’s leading life insuring company SBI Life will invest about Rs. 9,600 crore in Indian share market in this financial year. Until now, the company’s investment in equities was about Rs. 25,000 crore. This step will take the company’s total exposure in capital markets to over Rs. 34,000 crore.
SBI Life Insurance is a joint venture between France-based BNP Paribas Assurance and State Bank of India and. SBI owns 74% of the total capital in the joint venture and 36% is controlled by BNP Paribas Assurance.
The company at the end of March 31 has managed assets of about Rs. 40,163 crore and expects to increase assets under management (AUM) to approximately Rs. 60,000 crore during the current fiscal.
The life insurer is planning to launch new products in the traditional segment as well as in the unit-linked segment.
[Posted by:
InsuringIndia News
on
Sunday, May 1, 2011 2:17 PM]
As per a report compiled by the Federation of Indian Chambers of Commerce and Industry (FICCI) on health insurance in India, consistency in cost and treatment methods for different diseases can settle disputes between insurance companies and private hospitals over medical claims.
The FICCI team has prepared a list of standardized treatment procedures and cost indices for twenty common diseases, which will be presented to the health ministry in the next 4 to 6 weeks. India's top medical specialists and health ministry officials will frame a standard template and submit it to IRDA. This step is expected to enable health insurers and private hospitals to settle medical claims in a reasonable and faster mode.
However, finalizing the standardized procedure is going to be a tough task as there are many parties which will be affected by this, such as insurance companies, healthcare service providers, consumers, policymakers and regulators whose interests may conflict with each other.
As per the report, the insuring companies are suspicious of rising claims as they believe maximum of them are not genuine. The third party administrators (TPAs) believe that the system does not pay back with a firm return on investment (RoI). The customers are not satisfied by services and are angry over the delay in claim settlement.
The FICCI report is also advocating the portability scheme which allows individuals to change the insurer, if not satisfied.
