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Thursday, 29 October 2015

Insurance ombudsman an easy way to settle claims

Like in the case of other ombudsmen, a negligible number of the insured (policy-holders) are aware that a public authority called the Insurance Ombudsman exists in India, according to G. Rajeswara Rao, Insurance Ombudsman for Andhra Pradesh and Telangana and Yanam.

The level of awareness is so low that the ombudsman receives only a few thousands of complaints against the lakhs of claims repudiated every year, he said. The number of such claims rejected by 24 life and 28 non-life insurers in India last year was about four lakh. As the number of petitions submitted to the ombudsman is insignificant, awareness is being spread in different ways.

In 2014-15, 1,274 cases were settled involving an award amount of Rs. 13 crore within three months. In the current year, 595 cases were disposed of in as many months with a total financial award of Rs. 1.55 crore, he said.

Addressing the media here on Wednesday, Mr. Rajeswara Rao said aggrieved individuals who took policies like life insurance, Mediclaim, accident insurance and property insurance in their personal capacities could approach the ombudsman but the amount under dispute should not exceed Rs. 20 lakh.

Before lodging complaints with the ombudsman, the policy-holders should approach the grievance redressing committees of insurers.

The awards given by ombudsman were binding on the insurers but the aggrieved persons could go to a consumer court or other forum if he or she finds the awards unacceptable.

The policy-holders have to approach the ombudsman within a year of repudiation of their claims. Mr. Rajeswara Rao said 17 such insurance ombudsmen were functioning in the country and the Hyderabad centre that has jurisdiction over A.P, T.S and Yanam was adjudged the best last year.

In the first six months of 2015-16, the ombudsman passed 57 awards including 16 against Life Insurance Corporation of India and 10 against Reliance Life Insurance Co. Ltd. Complaints could be made in written form or mailed.

Source: The Hindu

Sunday, 25 October 2015

Benefits of Pension Products Bundled with Insurance to Consumers

It is estimated that the size of India’s elderly population aged 60 and above is expected to increase from 77 million in 2001 to 179 million in 2031and further to 301 million in 2051. Owing to declining birth rates and longer life expectancy, India’s elderly are growing annually at a rate of 3.8% as against the annual average growth rate of 1.8% of the total population. According to a FICCI-KPMG study, pension reforms held the prospect of enlarging the pension market size from Rs 56,100 crore in 2002 to about Rs 4,06,400 crore by 2025. Further,  as per the study, the existing government administered pension schemes cater only to 12% of India’s workforce, and the pension provided under such schemes are inadequate to cover financial needs of the retirees. There was need for constructing a portfolio with some exposure to equities and international markets with stress on low risk and high returns. For a successful regulatory regime, the three corner stones of product, processes and distribution were stressed. With only LIC and few other life insurance companies active currently in the pension segment there is a huge potential for life insurance companies to expand in this segment. Even PFRDA is regulating only the pension fund management and ultimately will have to transfer the corpus to a life insurance company to provide annuities. There is a great demand for annuity service providers. Pension funds, being long term in nature, support infrastructure investments in a big way.

Pension funds carry long term benefit guarantees. For example, a customer buying a Deferred Pension Policy at age 30, retiring at age 58, can pay periodic premiums over the active service in convenient instalments and upon reaching the age of superannuation, say at age 58, can start receiving a periodic annuity. Up to 1/3rd of the corpus (which is the accumulated value) at age 58 is allowed to be commuted (withdrawn as a lump sum) and the balance 2/3rd is invested in the name of the customer to earn a monthly annuity starting from the retirement age.

Since all life insurance companies are required to give a positive interest guarantee, the customer gets a certain amount of guarantee in the corpus build up or in the form of guaranteed annuities.

Upon superannuation, the corpus is utilised to purchase a Single Premium Immediate annuity from the same insurance company. Annuities are payable depending on the options selected by the customer – It can be a Life annuity, payable during the life time of the Customer and stops upon death or it can be an Annuity certain for minimum period of years, say 5 years, 10 years or 15 years after superannuation, continuation of Pension after death of the annuitant, in the name of Spouse till his/her death etc.

Pension products also carry an assured death benefit which is normally in the form of return of premiums.

Advantages of developing Pension products

  • Building a corpus over a period of time rather than in a short period – Pension plans are vehicles to build a corpus over a period of time – the benefits of starting early in life through a pension policy
  • One vehicle for both corpus building and annuities – Pension products provide one window of opportunity to build corpus as well as annuities through a single insurance company
  • Guaranteed returns - The regulator has prescribed that all insurers must guarantee  non-zero returns in all pension products.
  • Tax benefits for pension premiums under Section 80CCC, up to a limit of Rs 1.50 lakhs per annum along with other eligible investments under Section 80C and 80CCD


Saturday, 17 October 2015

Secure ‘study-abroad’ experience with student insurance

Overseas student insurance policies offer wide bouquet of benefits to insurance buyers. These policies not only offer more benefits but also come cheaper as compared to the policies issued overseas.

It’s a proud moment when you secure admission to a coveted course at a foreign university. There is the distinct and indescribable feeling that the world is your oyster and the future is full of immense possibilities. But as the actual visa application process kicks in, and there is talk of purchasing insurance, at home or through the university, you may consider some less delightful possibilities – falling ill while you are far from home, meeting with an accident on foreign soil, losing important documents that support your identity and more... Who, you may wonder, will take care of you and help you when such vulnerabilities strike and you are far from your homeland?

Insurance to the rescue

‘Travel abroad for studies’ forms less than 5% of all the reasons why Indians go overseas. Nevertheless, domestic insurance companies take this segment very seriously and offer a special kind of product to meet its unique needs. If chosen well, this product can cover all the perils you may face as a traveller and those that may confront you as a student living in a foreign land.

Mandated by the law of foreign lands

At one level, health insurance is usually mandatory for those who travel abroad to pursue education. Medical insurance is a must for students, although it can be purchased either from India or in the country of your destination, from the university that you plan to attend.

Insurance beyond health

A student insurance policy from India, on the other hand, offers much more than just financial protection in unexpected accidents and illnesses. If you do your homework thoroughly, you will find policies that cover a range of untoward incidents – medical, travel and non-medical – that could strike while you are studying abroad. With no pre-policy medical check-up required, these plans indemnify medical expenses, in-patient and out-patient care and pre-existing diseases in life threatening medical conditions. They also come with customized features such as extended cover in the country of residence, repatriation of mortal remains and medical evacuation. By way of accident insurance, these policies pay out an accidental death benefit or a permanent partial or permanent total benefit, as the case may be.

Far-sighted features

Appreciating the fact that you are far from home and may encounter some loss of documents or belongings, such policies indemnify loss of passport and loss of checked-in baggage. New-age features like Loss of Laptop/Tablet are also sometimes bundled into the package.

Another interesting feature is sponsor protection, wherein the insurance company indemnifies the balance fees for regular classroom study for your educational course in the event of the death of your sponsor due to an injury, subject to conditions. Trip delays, emergency cash advances, cancer screening, treatment of mental or nervous disorders and alcoholism and drug dependency also form part of student policies, naturally, subject to reasonable conditions.

The extent of the far-sightedness of domestic student policies is apparent from the fact that some indemnify the actual additional expenses (e.g., those borne towards accommodation and a common carrier) that you may incur to return to India in case the university in which you study becomes insolvent. Still more, some student policies even indemnify the legal costs of procuring a bail bond, which is required to be furnished in the event of the arrest or imminent arrest of the insured person by any government or statutory body or authority.

Cost comparisons

With all these incredulous features, it natural to imagine that these policies will come at a considerable cost. Surprisingly, they don’t. With all their appealing features that seem to blend together the best of health, accident, travel insurance, child plans and more, these policies are highly economical in comparison to standard policies that are issued by universities abroad. Now that’s what really qualifies as getting the best coverage for the buck!


Thursday, 15 October 2015

IRDA cautions public not to buy unauthorised insurance policies

Insurance Regulatory and Development Authority(IRDA) today cautioned the public that Allied Trade Masters operating from Prashant Vihar, New Delhi, has not been licensed or granted registration to sell insurance policies of any kind in India.

In a recent statement here, the Insurance Regulatory said, it has been brought to the notice that an entity by name Allied Trade Masters, operating from New Delhi, has been selling motor insurance policies.

In this connection, the Authority cautions the public not to buy insurance policies from Allied Trade Masters.

The Public are informed that the Authority is taking action against the entity and the persons connected with that entity.

IRDA hereby urges the public to remain alert and not to fall prey to frauds and cheating indulged in by the said entity, the statement added.

Source: WebIndia123

Monday, 12 October 2015

Car insurance policy with free roadside assistance

Roadside assistance is an amazing service which takes care of all your roadblocks when you are driving your car. If you have driven a car in India you would know how painful it is to drag your car to the garage or wait for the mechanic to reach you. Considering the dismal road condition in India there is a high probability of a tire puncture or a breakdown.  The large numbers of reckless and untrained drivers make an accident a viable possibility. Wouldn’t it be great if there was someone who would take care of your car in case of a breakdown? If the answer is yes, then roadside assistance is exactly what you are looking for.

Roadside assistance is provided by major car manufacturing companies, insurance companies and stand-alone service providers which offer it as a full-fledged service. However, it needs to be noted that some insurance providers on the market provide this service free of cost. What kinds of services are offered with roadside assistance? Let’s go through the following list to know more:

  • Towing assistance
  • Emergency message relay to friends and family
  • Battery jumpstart
  • Organizing a taxi and hotel accommodation
  • Tire punctures
  • Minor repairs
  • Emergency fuel assistance and much more
Such cutting-edge services are provided along with roadside assistance and they are just a phone call away. Wait! There are other ways to inform your service provider about your car breakdown. For the tech-driven souls there are a few insurance companies such as Reliance General Insurance that offer specialized apps for providing this service. E.g. the Anywhere Assist app.

So, you have the option of calling for help at the click of a few buttons. The phone will automatically fetch your location from the GPS on your mobile.

Hence, ensure you are covered under roadside assistance, so you are never stranded on an unknown location. A car insurance policy with free roadside assistance would do the trick for you.

Source: New Indian Express

Friday, 9 October 2015

Women's insurance market in India likely to grow four-fold by 2030

Women's insurance market in India is expected to result in two to four times growth by 2030, according to a study done by AXA in association with International Finance Corporation (IFC).

The India chapter of the report titled 'SheforShield: Insure Women to Better Protect All', presented by Bharti AXA, was conducted in emerging economy countries of Brazil, China, Colombia, India, Indonesia, Mexico, Morocco, Nigeria, Thailand and Turkey.

It said the Indian women’s insurance market is predicted to be between US 22 billion - 35 billion by 2030, which is two to four times the estimated premium of USD 10 billion spent by women in 2013.

The study lists increase in number of working women in the country, along with 20 per cent growth in their income compared to 2008, among growth drivers for this segment.

Another important factor highlighted by the study, which could contribute to the growth in insurance premiums from women is the increasing number of women entrepreneurs in India.

Source: KNN India

Monday, 5 October 2015

Less than 20% of population covered under health insurance: Report

Despite liberalization of the insurance industry, less than one-fifth of India's population are covered under health insurance. Even among those who have some form of coverage, 67% are covered by public insurance companies, according to National Health Profile 2015, compiled by the Central Bureau of Health Intelligence.

As per the separate chapter on health financing, despite a declining share of the Centre towards public health expenditure has done significantly well to provide insurance cover as compared to the private sector.

Apart from the standard health insurance, around 15.5 crore people are covered under the three Central government-funded health schemes - Central Government Health Scheme, Employees' State Insurance Scheme and Rashtriya Swasthya Bima Yojana.

A low public health spending coupled with poor health insurance penetration is reflected in India's high out-of-pocket expenditure on health. In rural India, almost 80% of the out-of-pocket expenditure is on medicine, whereas in urban areas it is around 75%.


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