Life insurance most preferred investment for affluent Indians

Life insurance has emerged as the most preferred investment option for Indian households with an income up to Rs 25 lakh, says a survey.

Seventy per cent of affluent population of the country, who hold investments other than cash, have put their money in life insurance, while 64 per cent among them have gone for fixed deposits, according to the DSP BlackRock India Investor Pulse Survey.

It is followed by their investments in other financial instruments like shares (46 per cent), equity mutual funds (33 per cent), fixed maturity plans (27 per cent), tax-free bonds (25 per cent) and so on, it said.

"Even though the larger current ownership is in insurance and fixed deposits, there is a growing awareness among the educated affluent category of investors in the country to move more money from cash and deposits to other form of investments like mutual fund and bond," said DSP BlackRock Executive Vice President, Head (Sales) and Co-Head (Marketing), Ajit Menon, while unveiling the survey report here today.

People living in the country invest 25 per cent of their monthly take home pay, which is higher than the global average of 17 per cent, it said.

When it comes specifically to asset allocation, Indians are more likely to invest in property than the global average, it added.

Equities and bonds are also important asset classes accounting for 13 per cent and five per cent of the total value of saving and investment products, the survey said.

Majority of Indians (56 per cent) feel their economy is getting better, way ahead of the global average of 22 per cent. The huge margin of positivity extends to their financial future with 81 per cent of Indian respondents feeling positive as compared to 56 per cent globally, it added.

A large proportion of Indian respondents also feel that they are in control of their finances (75 per cent) as compared to the global average of 55 per cent, second only to China (84 per cent).

Source: Times of India.

Life insurance claims to be settled within 60 days

The insurance regulator is looking to make it mandatory for companies to settle life insurance claims within 60 days, as against the earlier six month time frame.

Following the implementation of new rules, if a claim is not settled within 60 days, the beneficiary can take the insurer to court.

On its proposal to reduce the claim investigation time, the Insurance Regulatory and Development Authority (Irda) has sought the response from life insurers.

According to life insurance companies, most of the cases are resolved within a couple of weeks. However for 15 per cent cases the lack of required documents or disputes, pose problems. For such cases such claims can then stretch beyond the mandated timeframe.

The Union Cabinet had on December 24 approved promulgation of an ordinance on the Insurance Laws (Amendment) Bill, 2008, just a day after the Winter Session of Parliament concluded with finance minister Arun Jaitley announcing that the “country can no longer wait”.

The insurance reforms initiative by the government, which will attract more foreign capital into the sector, will also have stringent penalty provisions on companies found compromising on consumer interests. The Ordinance will also provide more teeth to the IRDA.

Source: indiatvnews.com