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The Thane District Consumer Redressal Forum (TDCRF) on Wednesday directed a private insurance firm, Future Generali India Insurance Company to pay the complainant the claim amount of Rs 1.5 lac and also Rs 25,000 towards legal expenses.
In its order, the Forum President Mr. Umesh Jhavalikar and Member ND Kadam stated that even if there is violation of the conditions in the insurance policy the insurance company cannot reject the claim taking shelter under 'technical reasons'.
The complainant, Ashok Kesav Pandit of Shahapur town of Thane district filed a complaint with the forum against the insurer of his car Future Generali India Insurance Company after the insurer rejected its claim on technical grounds.
On September 29, 2009, the driver of the car Rajendra Amrutlal Pal aka Pappu was on his way to Mumbai from Kankawli. He had offered lift to two persons and also charged them, but the car met an accident on the way. The passengers died and the car got damaged in the accident. According to the claimant, he informed the insurance company about the accident and lodged the claim for the damaged vehicle. But the insurer rejected the claim arguing, since it was a private car and the owner used as a passenger vehicle, which is a violation of insurance norms.
However, the forum, in its order, citing a Supreme Court ruling said the company is bound to give 75 per cent of the claim, as per the apex court's ruling.
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The Cabinet Committee on Economic Affairs (CCEA), one of the standing committees of the cabinet constituted by the Government of India, on Thursday approved Insurance Laws (Amendment) Bill, which proposes to raise Foreign Direct Investment (FDI) cap in insurance to 49 per cent from current 26 per cent.
In a meeting of the CCEA, headed by Prime Minister Mr. Narendra Modi, the cabinet approved 49 per cent foreign investment in Indian insurance market through the Foreign Investment Promotion Board (FIPB) route ensuring management control in the hands of Indian promoters.
Union Finance Minister, Mr. Arun Jaitley, in his maiden budget speech had said that the insurance sector is investment starved and there is a need to increase the composite ceiling in the sector to 49 per cent. Now, as the cabinet has approved the bill, it will be tabled in the Parliament.
The Insurance Laws (Amendment) Bill was first introduced by the UPA government in 2008, but it could not be taken up in the Rajya Sabha, the Upper House of the Indian Parliament, because of opposition from then main opposition party the BJP.
This time again, the Rajya Sabha could come on the way of insurance bill, as the ruling NDA has not necessary numbers there. It will totally depend on the Congress and other parties move.
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Despite being mandated insurance cover for vehicles running in India, a large number of vehicles are plying without having insurance cover. With a view to curb and reduce uninsured vehicles in the country, the insurance watchdog, Insurance Regulatory and Development Authority (IRDA) has started a pilot initiative in Cyberabad, Telangana, to strictly enforce the provisions of the Motor Vehicles Act.
“We have collaborated with the police and they will send challans to owners of vehicles without an insurance policy. What we have found (through the pilot) is that out of the 12 lac registered vehicles, almost 25 per cent do not have an insurance policy,” said Mr. M Ramprasad, Member, Non-life, IRDA.
If the results of this pilot initiative are encouraging then we will extend it to seven more states, he said, adding, “ We are planning to collaborate with the Ministry of Road Transport to use their data on the number of registered vehicles to corroborate data from insurers.
As per a report of ICICI Lombard General Insurance, about 40 per cent cars are uninsured; while, whopping 70 per cent two-wheelers are plying without insurance cover.
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Private sector life insurance player Future Generali India Life Insurance Company Ltd Tuesday announced the launch of its new product ‘Care Plus’, a simple and affordable pure term insurance plan.
On the launch, Future Generali India Life MD & CEO Mr. Munish Sharda said, “This plan provides financial security at affordable rates, with no hidden costs, keeping in mind the customers’ requirements. The launch of this product is a step towards augmenting our next phase of growth.”
Since the Indian insurance sector was opened for private and foreign companies in year 2000, the industry has witnessed a significant growth and transformational changes; despite that, merely 4 per cent of the population has got insured cover as of now, which is, of course, a serious matter of concern.
This new offering of Future Generali is a simple pure protection plan, which provides financial security to family at extremely affordable rates. It comes with two options –First, Future Generali Care Plus Classic, which is for those seeking insurance cover up to Rs. 25 lac. Second, Future Generali Care Plus Premier, which offers protection cover of Rs. 25 lac and above.
Under the Future Generali Care Plus Premier option, non-smokers can avail discount on premium. Customers can avail tax deduction benefits on premiums paid under the Section 80C and Section 10(10D) of the Income-Tax Act.
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Private insurer Kotak Mahindra old Mutual Life Insurance (Kotak Life Insurance) has launched Assured Income Accelerator, a plan which guarantees an increasing income every year during the payout phase, irrespective of economic changes.
In a release, Kotak Life Insurance Managing Director Mr. G Murlidhar said, “This product fulfils a long pending demand for a life insurance product which offsets the ever-increasing cost of living and meaningfully addressed an individual's lifecycle needs.”
Assured Income Accelerator addresses a wide variety of customer needs ranging from second income to planned lifecycle events such as child education and retirement, Mr. Murlidhar added.
Under the plan, the minimum annual premium is Rs 15,000. The annual payout of guaranteed income commences after premium payment term is over. At maturity, guaranteed maturity benefit is also payable along with the last instalment of the increasing guaranteed income.
In the case of unfortunate death of the person insured, the plan pays out a guaranteed death benefit, irrespective of the payouts already given.
This new offering of Kotak Life Insurance also provides optional riders such as Term Benefit, Accident Death Benefit, Permanent Disability Benefit, Life Guardian Benefit and Accidental Disability Guardian Benefit.
Kotak Mahindra old Mutual Life Insurance is a joint venture between Kotak Mahindra Bank and South Africa-based Old Mutual Public Limited Company, a global investment, savings, insurance and banking group. Kotak Mahindra Bank owns 74 per cent of the stake in the JV; while, Old Mutual holds the remaining 26 per cent.
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The union budget presented recently by the Finance Minister Mr. Arun Jaitely has promised to table the long awaited Insurance Laws (Amendment) Bill, which proposes to raise foreign direct investment cap to 49 per cent from current 26 per cent, in the current session of the Parliament. It is encouraging for the industry but has also created a state of confusion within the industry on some points.
The budget proposals have imposed a withholding tax of 2 per cent on payment made by insurance companies to their policy holders. The logic of imposing such tax has not been defined.
Further, Mr. Jaitely announced that the composite FDI ceiling in the Insurance sector is proposed to be increased up to 49 per cent from the current level of 26 percent, with full Indian management and control, through the FIPB route. In which, terms composite ceiling, full Indian management and control are not clearly defined.
The industry wants to know whether full Indian management and control would be achieved through differential voting rights, or through compelling the insurers to have their board majorly with Indians and the company to be headed only by an Indian.
Also, the industry is apprehensive about routing the FDI proposals through Foreign Investment Promotion Board (FIPB) instead of the current automatic route.
"In the banking sector FDI up to 49 percent is under automatic route. There are lots of checks and balances in the insurance sector. With stiff solvency norms policy holders will not lose their monies. There need not be any differential treatment between these two sectors," a senior industry official said.
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Bajaj Finserv Limited (BFL), a leading financial services company of the Bajaj Group, is considering selling part of its stakes in insurance joint ventures to its foreign partner Allianz once the Insurance Laws (Amendment) Bill is passed.
The Insurance Laws (Amendment) Bill, which proposes to raise foreign direct investment (FDI) in insurance to 49 per cent from current 26 per cent, is pending in Rajya Sabha, the upper house of the Indian parliament, since 2008.
Bajaj Finserv is present in insurance businesses through 74 per cent stake in Bajaj Allianz Life Insurance and Bajaj Allianz General Insurance.
Both the life insurance business and the non-life insurance business were generating funds to sustain themselves and no further capital infusion was required, said Bajaj Finserv Managing Director Mr. Sanjeev Bajaj.
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Two private sector insurance players - Exide Life Insurance Co Ltd and Magma HDI General Insurance Co may not seek foreign direct investment (FDI) flowing into their companies anytime soon even if the long pending Insurance Laws (Amendment) Bill, which proposes raising FDI ceiling to 49 per cent, is passed.
"We are well-capitalised and not looking at any investments through FDI route in our businesses in the short term. However, in the long term, Exide Industries intend to induct a new foreign shareholder," said Exide Life Insurance MD and CEO Mr. Kshitij Jain.
While Banglore-based Exide Life Insurance Company is fully Indian company with 100 per cent holding owned by Rahejas-controlled battery maker Exide Industries, Magma HDI General Insurance is 74 per cent stake owned by Magma Fincorp with remaining 26 per cent being held by Germany partner HDI-Gerling Industries Versicherung.
The Modi-led NDA government has said that it will table Insurance Laws (Amendment) Bill in the current session of the parliament. The foreign investors are waiting for the bill to be passed.
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Riding on the growth of internet reach in the country, private sector leading insurer HDFC Life Insurance Company is expecting to double its revenue from its online sales by 2016. It is seeing 10 per cent of its new insurance business coming from the online sales in just about two years.
"While the offline insurance premiums have a renewal rate of about 70 per cent, we are seeing over 95 per cent renewals for online insurance," said Executive Vice-President & Head (Strategy and Technology) for HDFC Life, Mr. Subrat Mohanty.
The insurer has grown 20 folds to Rs 300 crore since 2012, when it started online sales.
The online channel of insurance sales is more convenient as it does not require any agent’s involvement, and customers can themselves compare and choose best suited policies for themselves using different web aggregator present in the market. Also, online policies comes 20-25 per cent cheaper as there is no middleman involved in the transaction. Most of the websites selling online insurance do not charge brokerage but just a small commission for passing on the lead.
HDFC Life is facing resistance from agents for its offline business. The agents fear loss of business to the online channel. However, the insurer is trying to convince them to move online. The insurer is planning to launch a mobile app by October this year to enable customers to buy and get information about various product offerings from the company on the go.
HDFC Life Insurance is a joint venture between Housing Development Finance Corporation (HDFC) Limited, one of India’s leading housing finance institution and Standard Life Plc, a renowned financial savings & investments services provider of United Kingdom.
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In order to bridge the gap between the total cost of healthcare incurred and the amount covered by health insurance companies, health insurance companies have come up with comprehensive plans by adding up some extra features to their existing plans that would cover more than just hospitalisation expenses.
These feature-rich policies would be able to compensate policyholders the total actual cost occurred in healthcare, including hospitalisation reimbursement, pre-hospitalisation expenses such as out-patient department (OPD) and wellness services.
In addition, these companies would also be providing Worldwide Emergency Cover, disease- specific covers, value-added services in the form of discounts, health maintenance benefits and consultation charges for second opinion.
Conventional health insurance plans, especially the hospitalisation reimbursement category that exists in the market today, have been restrictive in terms of coverage, Bajaj Allianz General Insurance Managing Director and Chief Executive Officer Mr. Tapan Singhel said.
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The Union Finance Minister Mr. Arun Jaitley in his maiden budget speech on Thursday announced that the pending Insurance Laws (Amendment) Bill, which proposes to raise the FDI (Foreign Direct Investment) ceiling to 49 per cent from current 26 per cent, will immediately be brought for consideration before Parliament.
This move will help the sector in two ways - First, this help companies access capital more easily, which is huge positive, given that the insurance sector is capital intensive. And second, this could act as a trigger for listing of insurance players, which will provide a better yardstick to value these companies.
In his speech, Mr. Jaitly said benefits of insurance in India have not reached to a large section of the people as insurance penetration and density are very low. He assured that the government would work addressing this situation in multi-pronged manner with support of all stake holders concerned.
The voting rights of foreign stakeholders shall not exceed 26 per cent in the aggregate and the CEO of the said Indian insurance company, to be appointed by its Indian stakeholders, and the majority of the company’s directors shall be Indian nationals.
The Insurance Laws (Amendment) Bill was first mooted by the previous Congress-led UPA government, and has been pending in the Rajya Sabha since December 2008, as the BJP didn’t support it arguing that raising the FDI ceiling to 49% would expose the sector to global vulnerability.
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Seeking permission to issue compulsory third-party (CTP) motor cover with limited liability, general insurance companies have sent a proposal to the government. For the high-risk commercial vehicle segment, an option for additional liability limit covers is proposed, which will provide a sum over and above the basic motor policy.
According to a leading newspaper, the General Insurance Council and non-life insurance companies, led by the industry body, have sent a proposal to the Road Transport and Highways Ministry to consider third-party covers with fixed limits, similar to the pre-determined liability limits for air and train accidents.
The implementation of this model will need an amendment to the Motor Vehicles Act which currently does not stipulate any limit on the liability of vehicle owners. Non-life insurance companies say, due to this law, an increase in claim awards by courts is seen every year.
At present, combined ratios in the motor insurance segment stand at 140-150%, owing to losses in the third-party motor segment. According to an estimate, payouts by insurance companies to individuals for motor third-party related accidents have climbed 15-20%.
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New entrant in the general insurance business in the country, Magma HDI General Insurance is all set to launch a prepaid health card to facilitate payments at OPD (outpatient departments) and day-care facilities of hospitals.
This electronic health card can be used like any other debit or credit card but only in hospitals, the company said.Mr. Swaraj Krishnan, Managing Director and Chief Executive Officer of Magma HDI (MHDI), said, “Pre-paid health card is a step forward from the cashless concept.”
“The ‘hospital cash facility’ or prepaid health card will be linked to the company’s upcoming health insurance products in the individual, family and group categories. The amount of cash equivalent in the card will be based on the policy value of the user”, Mr. Krishnan said.
The company has applied to the Insurance Regulatory and Development Authority for necessary regulatory approval. It is expected that the product will be available for customers by September this year.
Magma HDI General Insurance is a joint venture between India’s Magma Fincorp and Germany’s HDI Gerling Industrie Verischerung AG. Magma Fincorp holds 74 per cent stake in the JV, while remaining 26 per cent by HDI Gerling Industrie Verischerung AG.
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State-run general insurance firm New India Assurance has paid a dividend of Rs 220 crore to the government for the fiscal year which ended on March 31, 2014.
As per an official, Chief Managing Director of New India Assurance Co. Ltd Mr. G. Srinivasan presented a dividend cheque of Rs 220 crore to the Union Finance Minister Mr. Arun Jaitly on Thursday.
The state-owned general insurance companies- New India Assurance, National Insurance Company, United India and Oriental Insurance Company Ltd have jointly registered a growth of 10 % in gross premium during the fiscal year 2013-14 and have projected a 100% increase in the next five years.
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Leading private sector insurer AEGON Religare Life Insurance (ARLI) Company has been conferred with the ‘E-Business Leader Award’ for the second consecutive year, under the category of Overall Insurance Industry Awards by the Indian Insurance Award in a function held in Mumbai on June 25, 2014.
The jury members were SB Mathur, Former Secretary General, Life Insurance Council; R Krishnamurthy, Senior Advisor, Towers Watson; Mr R Chandrasekaran, Secretary General, General Insurance Council.The E-Business Leader award is given to an insurance company that has deployed the online insurance channel effectively for sales, marketing and lead generation for the business. This also needs to commend an insurance company bringing special focus on this revolutionary distribution model.
Speaking on the occasion, Sri K.S. Gopalakrishnan, Managing Director & Chief Executive Officer at ARLI said, “AEGON Religare Life Insurance is extremely proud and happy to be honoured as the E-Business Leader Award for the second year in a row. As pioneers in the online business in life insurance in this country, it gives me immense pleasure to accept this well-deserved award. It further strengthens our leadership position.”
“Introducing India to a digital distribution channel for life insurance was a challenge and I believe ARLI overcame this hurdle by simplifying the buying process and introducing the customers to e-friendly products like ‘AEGON Religare iTerm Plan’ and ‘AEGON Religare iGuarantee Plan’. We wish to keep our focus on the E-Sales distribution channel and further strengthen our online presence”, he added.
AEGON Religare Life Insurance (ARLI) Company is a joint venture between AEGON (26%), an international life insurance, pension and investment company; Religare Enterprises Limited (44%), a global financial services group; and Bennett, Coleman & Company (30%), India’s largest media.
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