CBI probing other insurers in bribery scandal - source

MUMBAI (Reuters) - The Central Bureau of Investigation (CBI) is looking at the involvement of fund managers and senior officials at state-run insurance firms in the bribes-for-loans scandal, a source with direct knowledge of the matter said.
The CBI is looking into their involvement in all deals arranged by Money Matters Financial Services, a financial services firm at the heart of the corruption scandal that sent shockwaves through India when it was revealed earlier this week.
The CBI is also probing all block deals, bulk deals and share placements arranged by Money Matters, said the source, who declined to be named as details of the investigation were not public.
The CBI is probing 21 companies and has arrested eight officials from banks and financial institutions for allegedly taking bribes in exchange for large corporate loans, or in some cases, sharing insider information.
(Reporting by Indulal P.M.; Editing by Jui Chakravorty)
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LIC to name new CEO for housing fin unit in 2-3 days

Thursday November 25, 03:30 PM

MUMBAI (Reuters) - State-run Life Insurance Corp of India will name a new chief executive for its housing finance unit in 2-3 days, the insurer's chairman said on Thursday, after the arm's chief was arrested on bribery charges.

T.S. Vijayan also said they would form an internal inquiry team to investigate into the bribery charges.

India's federal investigative agency said on Wednesday it had arrested eight financial officials, including the chief executive of LIC Housing Finance and investment secretary at parent LIC, on charges of receiving bribes for granting loans.

Vijayan had earlier said as per the company policy the two arrested group officials would be suspended after two days of police custody.

(Reporting by Kaustubh Kulkarni)

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Pranab asks banks to look at exposure to loan scam

Thursday November 25, 04:10 PM

NEW DELHI (Reuters) - India's finance minister on Thursday asked all banks, financial institutions and insurance firms to look into their exposures to firms named by federal investigators in a loans bribery scandal.

A ministry statement quoted Pranab Mukherjee as calling on regulatory and other institutions to further improve safeguards.

Eight officials of banks and financial firms were arrested on Wednesday by federal investigators for taking bribes to facilitate large corporate loans. Investigators have not said who were the beneficiaries of those loans.

(Reporting by Abhijit Neogy; editing by Malini Menon)

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LIC chair: bribery charges not to impact balance sheet

Thursday November 25, 02:30 PM

MUMBAI (Reuters) - State-run Life Insurance Corp of India does not see any impact on the balance sheet and asset quality of its housing unit due to the arrest of the arm's chief executive, its chairman said on Thursday.

India's Central Bureau of Investigation said on Wednesday it had arrested eight financial officials, including the chief executive of LIC Housing Finance and investment secretary at parent LIC, on charges of receiving bribes for granting loans.

LIC Chairman T.S. Vijayan said as per the company policy the two arrested group officials would be suspended after two days of police custody.

(Reporting by Sowmya Kamath and Suvashree Dey Choudhury)

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Aon-Hewitt chalks out growth plan for India

Thursday November 25, 01:50 PM Source: Indian Express Finance By Diksha Dutta
Aon-Hewitt, formed with the $4.9 billion merger of HR firm Hewitt Associates with insurance brokerage Aon Corp, is eyeing to grab a share in the Indian market.
Aon-Hewitt plans to raise its headcount to 20,000 in India over the next three to four years against 8,000 at present. The company looks to tap the market with new recruits, fresh branding strategies and acquiring potential regional customers.
"Currently, one third (8,000) of Hewitt employees are based in India, but we aim to be a third of Hewitt -Aon (20,000) in the next three to four years," said Arjun Singh, senior vice-president & MD (Asia-Pacific), Aon-Hewitt. The global headcount of Hewitt is at 25,000 and for Aon it is 60,000.
Aon Corp has a captive in Bangalore which has 250 people at present. "This merger will help in establishing a captive for Aon in India, with the assistance of our mature platform," Singh told FE. Last year alone, Hewitt Associates signed 55 new customer deals in India. Hewitt has a strong presence in India, where its domestic HRO business services around 265 clients out of a total of 320. However, the regional (only India presence) clients of the company account for more than 50% of Hewitt customers. The Indian market, Singh noted, has started maturing, as more clients seek services beyond payroll and benefits (P&B), progressing to employee data management and other HR transactions.
A major repercussion of this merger is on the branding strategy of Hewitt which will now be consumer centric. "We have been concentrating on a business to business (B2B) branding strategy as our customers are primarily business leaders. Our focus will now be to create awareness of Aon-Hewitt as a brand in the Indian market amongst the talent available in the country," said Singh.
The two firms will bring their strengths in consulting, benefits administration and business process outsourcing to their clients not only in the consulting space, but also to the clients in the risk and reinsurance space as well, which creates the benefit of cross-selling. Based on 2009 revenues, the three leaders in HRO, combined with consulting space, would be Aon-Hewitt with $4.4 billion, followed by Mercer ($3.3 billion) and Towers Watson with $3.1 billion.
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LIC chairman: looking into need to tighten controls

Thursday November 25, 12:10 PM

MUMBAI (Reuters) - State-run Life Insurance Corp of India is looking into the need to tighten internal operational systems, its chairman told CNBC-TV18 on Thursday, a day after its housing unit chief was arrested on charges of accepting bribes.

LIC is planning to conduct an internal inquiry into the allegations and a board meeting for LIC Housing Finance as soon as possible to discuss the development, T.S. Vijayan told the Indian television channel.

LIC is considering two internal executives for the top job at the housing finance unit.

The Delhi-based Central Bureau of Investigation said on Wedneday it had arrested eight officials from banks and financial firms on charges of receiving bribes valued at hundreds of millions of dollars.

(Writing by Sumeet Chatterjee)

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Irda issues norms for universal life insurance products

Wednesday November 24, 11:03 AM Source: Indian Express Finance By fe Bureau

The Insurance Regulatory and Development Authority (Irda) has issued guidelines for universal life products or variable insurance products (VIPs). In a note to CEOs of all life insurance companies, Irda said all VIPs will only be offered under the non-unit linked platform.

VIPs are to be defined as non-linked life insurance products that provide a death benefit equal to the guaranteed sum assured, together with the balance in the policy account, Irda said. Besides, every policy shall have a corresponding policy account whose balance shall depict the accrual to the policyholder. The policy account shall be credited with premium net of all charges, Irda said. The guaranteed rate and bonus shall be applicable to the balance of the policy account. The statement of policy account shall be sent to the policyholder at least once a year.

Malay Ghosh, president & executive director, Reliance Life Insurance, said the Irda has defined the universal life product for the first time. "Though I'm yet to go through the Irda guidelines, I hope two of our traditional products may come under the definition of the universal life product, which have already been withdrawn by us temporarily since the circulars was issued by Irda on October 22. We are looking into the guidelines on the subject,'' he said .

According to the new guidelines, the policyholder will be offered the flexibility of changing the sum assured during the currency of the contract, subject to a minimum assured sum. The guidelines specify that no group insurance contract is allowed for these products at this stage. A top-up premium is allowed throughout the term.

However, at any point of time during the currency of the contract, the total top-up premium paid shall not exceed the sum total of regular premiums paid at that point of time. Besides, no partial withdrawal shall be allowed under this product. But a loan amount of not more than 60% of the balance may be extended at a rate of interest, the Irda notification said.

All VIPs shall be offered as traditional products either as participating or non-participating, as per the current practice. Further, for all modes of premium payment (viz., annual, half-yearly, quarterly and monthly) the additional interest rate (for non-par) or the bonus (for par) shall be declared once a year (immediately after the annual actuarial valuation i.e., as on March 31 of each year) which is to be credited to the policy account in the manner as specified in clause 4. The guaranteed rate is to be credited to the policy account at least on quarterly basis.

The insurer has to keep a separate account of all receipts and payments in respect of this product. The valuation of assets and liabilities shall be in accordance with the Irda (assets, liabilities and solvency margin) Regulations, 2000.The insurance regulator had banned sale of universal life insurance policies in October after receiving complaints on the sale practices of the insurers. However, Irda had issued the draft guidelines for these products.

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Sun Life Financial eyes growth in China, India, US

Wednesday November 24, 01:10 AM

TORONTO (Reuters) - Sun Life Financial, Canada's No. 3 insurer, plans to expand its operations in China and India to capitalize on the insurance and investment needs of a growing middle class in the two countries, the company's chief executive said on Tuesday.

Sun Life plans to expand its Chinese presence through its Everbright joint venture, which became the first foreign joint venture to be recognized as a domestic Chinese company this past summer.

"As insurance penetration is currently low in these markets, there are excellent prospects, partly driven by the strong domestic savings cultures," Sun Life Chief Executive Don Stewart told an investor presentation in Toronto.

Everbright, which is 20 percent owned by Sun Life, currently operates in 18 cities, and Stewart said the company plans to expand into others.

Sun Life plans to continue to grow its Birla Sun Life unit in India, whose premiums and deposits have more than quadrupled to C$406 million ($398 million) over the past four years, while its assets under management have more than tripled to C$14 billion.

The company is also eyeing rapid growth at its U.S. MFS mutual fund arm, with a goal of eventually doubling the unit's assets under management to $400 billion.

Robert Manning, head of MFS Investment Management, said the plan to raise the unit's assets to $400 billion was an "aspirational" goal that would be possible due to Sun Life's vast global reach. The insurer currently has a presence in more than a dozen countries.

"We don't have to invest much capital at all to take the firm and double its size in assets," he said.

Sun Life's shares were down 25 Canadian cents at C$28.37 on the Toronto Stock Exchange on Tuesday.

(Reporting by Cameron French; editing by Rob Wilson)

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Global biz leaders to push for reforms

Source: Indian Express Finance By Rajat Guha

Disappointed with the virtual stalemate on key economic reforms in the UPA-II government, a high-level group comprising top global business honchos of Indian origin like Indra Nooyi, LN Mittal and Vikram Pandit would meet Prime Minister Manmohan Singh early January next year to press for speeding up of reforms. Subjects that would figure prominently in the meeting would be raising the FDI cap in insurance to 49%, allowing foreign investment in multi-brand retail and setting up one composite FDI body which would both frame and clear FDI proposals, a source said.

These corporate bigwigs, apart from 15 other members, who form a part of the PM's Global Advisory Council for Overseas Indians (GAC) which was formed in 2009, meet once a year to discuss issues ranging from skills development, education and facilitating foreign investment into the country.

A member of this council told FE that the high-powered panel was finalising its discussion points with the PM and there was broad consensus to raise issues especially pertaining to the key bottlenecks in increasing the FDI limit in some sectors. "Among the three issues would be that of insurance. The bill (to raise the FDI cap to 49%) has been pending for two years. Our estimates suggest that over the next 10 years, India would have to invest anywhere close to $1.7 trillion to create the basic infrastructure for insurance. Allowing FDI would be one such option," the source said.

Raising the existing 26% cap on FDI in insurance to 49% was seen as one of the big-ticket reforms towards the fag end of UPA-1. The cabinet had given its in-principle nod to the proposal. However, due to the impending elections in the May 2009, the matter has still not seen the light of day. The Insurance (Amendment) Bill 2008 sought to not only raise the FDI cap but also provide IRDA flexibility to discharge its functions.

The source said that apart from urging the PM to allow FDI in multi-brand retail, the panel would also urge the PM to streamline the FDI procedures in the country by setting up one composite FDI body. As per the current practice the Department of Industrial Policy & Promotion (DIPP) frames the FDI policies under the commerce & industry ministry while the Foreign Investment Promotion Board (FIPB) under the ministry of finance clears these propoals.

"We would hope that the PM considers setting up one single centralised body. Since there are more than one government bodies dealing with FDI, it delays the process," the source said.

Framing of a one single body for both framing FDI policies and clearing proposals was discussed in the previous UPA regime but due to lack of beuareucratic consensus it did not materialise. The commerce and industry ministry and finance menistry are averse to let go their FDI related departments DIPP and FIPB, respectively. Even though the finance minstry had earlier on several occasions raised the issue of subsuming DIPP with FIPB, a severe resistance from commerce minister under Kamal Nath had prevented that.

In the April-September period, FDI inflows into the country had dipped 28% to $11 billion as against $15.3 billion in the same period last year. Following the US President Barack Obama's visit to the country earlier this month, the sensitive issue of allowing the likes of Wal-Mart and Carrefour to set shop in the country has gained momentum. Government sources said that the Prime Minister's Office, Planning Commmission, finance ministry and the agriculture ministry have agreed to allow upto 26% FDI in muli-brand retail.

The PM's GAC was the first of its kind initiative by any government to create a platform to engage with successful Indian leaders across the world over various issues. Apart from Nooyi, Mittal and Pandit, other key members include the first Indian-born head of McKinsey & Company Rajat Gupta, Padma Bhushan awardee in 2001 Swadesh Chatterjee, Columbia University professor Jagdish Bhagwati and other key officials of the government including external affairs minister SM Krishna.

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Result Corner

Thursday November 11, 01:57 PM Source: Indian Express Finance By fe Bureau

ING net falls 26% on US insurance writedown; plans 2 IPOs by Dec end

ING Groep NV, the biggest Dutch financial-services company, reported a surprise 26% drop in third-quarter profit after a writedown at its US insurance business. Net income fell to 371 million euros ($511 million), from 499 million euros a year earlier, Amsterdam-based ING said in a statement on Wednesday. Earnings missed the 938.4 million-euro average estimate of 14 analysts surveyed by Bloomberg as the company wrote down goodwill at the insurance unit by 513 million euros. ING agreed to split its insurance and banking units by the end of 2013 to gain European Commission approval for a government bailout, which included 10 billion euros of state aid and the transfer of 21.6 billion euros of US mortgage assets. The company plans to separate the two businesses by the end of the year as it prepares to sell the insurer. "While the option of one IPO remains open, we are going to prepare ourselves for a base case of two IPOs for our insurance businesses: one Europe-led IPO with solid cashflow combined with strong growth positions in developing markets, and one separate US-focused IPO with a leading franchise in retirement services," chief executive officer Jan Hommen said in the statement.

Prudential Q3 group sales up 17% on demand from emerging mkts

Britain's largest insurer Prudential Plc on Wednesday reported a better-than-expected 17% rise in third-quarter sales, helped by strong growth in its flagship Asian markets. Prudential has focused on expanding in fast-growing Asia to offset stagnant sales at home. The region now accounts for almost half its revenue, making Prudential one of the biggest foreign-owned insurers operating in Asia. Prudential said it had sales of 809 million ($1.3 billion) on an annual premium equivalent basis in July-September, ahead of a consensus forecast of 773 million , and up from restated 689 million a year earlier. The company reported new business profit of 1.3 billion pounds for the first nine months of 2010, up from 1.1 billion last year and in line with expectations. It did not give a figure for the third quarter. Prudential said it expected sales in India to suffer in the months ahead as a result of regulatory changes that will force insurers there to design new products and seek authorisation to market them.

Lenovo Q2 profit beats forecasts; growth in China market could slow

Lenovo, the world's No. 4 PC brand, posted its best profit growth in four quarters, helped by its mature markets returning to profitability but warned that growth in its key China market could slow. Lenovo saw the biggest improvement among the top PC brands in the third quarter of this year, with shipments up 33% during those three months, according to research firm IDC. This was better than rivals Hewlett-Packard, Acer and Dell, and also about three times the speed of the overall market's 11%growth. The PC brand's earnings also top off with a string of better-than-expected earnings from technology peers such as Microsoft and Google, pointing to continued strength in the sector. PC demand growth in China will likely be moderate given the high comparison base, the company said in a statement. Lenovo posted a net profit of $76.6 million in its fiscal second quarter through September, up 43% from the $53.1 million recorded a year ago, according to Reuters calculations based on data supplied to the Hong Kong stock exchange. China continued to make up the largest portion of Lenovo's sales, accounting for 47% of its total revenue in the second quarter, down from 48.7% in the April-June quarter.

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Videocon, Liberty plan non-life insurance JV

Source: Indian Express Finance By fe Bureau

Videocon (VIDEOIND.NS : 218.6 +2.45), the flagship company of Videocon group and Liberty Mutual group, a Boston-based global property & casualty insurance major, are planning to form a joint venture to foray into non-life insurance sector.

Under the proposed agreement, Liberty Mutual Group through a subsidiary will initially pick up 26% stake in the Indian JV and may raise it to 49% when the regulations permit. Venugopal N Dhoot, CMD, Videocon Industries said, "The company has a strong presence in Indian consumer space ranging from white and brown goods to mobile telecom services covering entire geography of India. Domain expertise of Liberty Mutual Group coupled with our huge platform of brand, trade and customer relationships will provide a robust business model to our general insurance business."

However, Venugopal said the company has no other plans to enter into no other segments of Indian financial sector.Earlier, Liberty Mutual had a tie up with Dabur (DABUR.NS : 96.15 -1.4) group for entering into general insurance sector, but couldn't progress due to regulatory hurdles. Making an announcement about the proposed JV in Mumbai on Wednesday, David H Long, president, Liberty Mutual group said, "We are ending our earlier JV with Dabur group. We expect our new JV to be formed in a week and start operations after a year. We are targeting a premium of $ 50 million in the the first year. We are projecting a premium of $ 300 million over a period of five years." To begin with, the JV will have its capital base of Rs 300 crore which will be sufficient to take care of the financial requirements of the company for the first five years.

Long said that the JV would infuse another capital of $40 million afterwards and has a break-even target within five years.

Both the companies will sign the joint venture agreement and apply to Insurance Regulatory & Development Authority (IRDA) for a license soon , said Long .

The Videocon and Liberty Mutual JV will be initially focus on motor, health insurance, home insurance and small enterprises insurance, he said.

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Waiver of premium-a key insurance rider

Saturday November 13, 05:41 AM

With the growing uncertainty of life, getting an insurance policy has become a must for almost every individual. When you take an insurance policy, you also tend to add 'riders' to the policy. Riders are the additional benefits that you may buy and add to your policy. Riders can be mixed and matched based on one's preferences for a small additional cost.

One size does not fit all

A one size fits all approach does not apply to insurance policies. Therefore, the kind and number of riders added to an individual's insurance policy depends on many factors such as individual's health, future plans, purpose of the insurance, etc.

One of the most popular and important riders added to an insurance policy is the 'Waiver of Premium.' If this rider is a part of insurance policy, it ensures premiums to be paid by the insured are waived off if the latter becomes unemployed due to an injury or sickness. In such a situation, even though the premiums are not paid by the insured, the policy does not lapse.

What is a waiver of premium?

A waiver of premium is an extra option life insurance companies provide you with on top of your purchased life insurance policy at an additional cost. This offers protection and cover for your premiums if you should fall seriously ill or incur injuries that leave you impaired - a situation where you cannot earn. In such an unfortunate event, the life insurance company will become responsible to pay the premiums which you were expected to pay.

The best part about this rider is that anyone who takes up the insurance policy can effectively add this rider to the policy. The amount of premium to be paid depends on the premium you pay on the base policy and on other riders. The higher the premium on the base policy and the more the riders you add, the higher will be the premium you pay on this rider.

Is it worth it?

With the increasingly stressful lifestyle, hazardous traffic situations, addition of this rider to an insurance policy could be very helpful. The rider also ensures that in an event of death of the insured during policy term, the policy does not lapse and remains in force even during the Auto Cover period. An Auto Cover Period is a term of two years during which full death cover continues even if the insured has not paid premiums - subject to at least two full years' premiums having been paid. The premium paid for this rider also qualifies for tax deduction under section 80D of the Income Tax Act.

How is it useful?

This rider is especially useful for a child insurance policy as it has been primarily set up in place to provide money for your child in an hour of his or her need.

In case of child insurance policy, where you are ensuring your child receives a sum of money at a certain pre-defined age, this will ensure that the process is uninterrupted and premium payment is continued.

The terms and conditions regarding what constitutes serious illness or injury and conditions regarding the time frame when the premium payment starts by the insurer, etc are defined by the insurance company and may vary from one company to another. Be sure to research on this thoroughly and understand the clauses and conditions of the insurance company.

Usually, the premium paying term for the rider is throughout the benefit period. Few companies restrict time frame of a policy owner or maximum duration of policy to 25 to 30 years.

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Insurance Ltd

Thursday November 11, 01:40 PM Source: Indian Express Finance By Saikat Neogi

India's insurance industry is at a crossroads. While the demand for insurance products is projected to grow due to the growth of both household savings and working population, the growth rate of the industry in the last two years has actually declined. Adequate capital to scale up operations is a major constraint for smaller and new companies. The industry is a highly capital-intensive one and requires capital infusion at regular intervals. Even fixed costs are high in India because of the vast geographical spread and smaller players with limited access to capital often do not have adequate funds to scale up their operations.

An E&Y report says that private insurance companies have a high expense ratio as compared with public sector insurance companies. The expense ratio, which includes operating expense and commission expense, is around 30.6% for private sector life insurance companies and around 30.1% for non-life private insurers. For long-term sustainability and profitability, this ratio should not be more than 10-15% as per the norms in developed countries. As India's insurance industry is at a nascent stage, many companies are yet to break even and rising expenses can further delay the process.

An FDI increase from the current 26% to the proposed 49% could help smaller players access capital, technology and actuarial know-how and product development. This will help insurers reduce operating expenses and secure a strong foothold in a rapidly growing insurance market. Going ahead, insurance companies will have to compete on a number of parameters like price, product underwriting and innovative sales strategies, and customise products to suit individual needs.

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Health insurance must have minimal fineprint

Saturday November 13, 05:41 AM

With the country's health insurance penetration at only about 3%, there is a huge market yet to be tapped. A new entrant in this space is Max Bupa Health Insurance, a joint venture between Analjit Singh's Max and global health insurer Bupa. Damien Marmion, the chief executive of the company, in an interview with FE's Sitanshu Swain, discusses his plans for India and promises to bring in a different experience in the domestic health insurance market. Excerpts:

How do you view the Indian healthcare and health insurance markets? Currently, how developed or undeveloped are they?

In India, the health insurance market is in a highly nascent stage. With a current penetration level of about 3%, there is huge potential to be tapped. Effectively, 97% still need a good health insurance cover. Healthcare itself has a lot of ground to cover in India and there is a need for more quality hospitals and doctors. Also, the regulatory environment is currently changing and enabling insurers to offer more quality services. We believe that healthcare requires a long-term relationship with the customers, it is not just a transaction. Customer centricity is the key to delivering high quality and consistent customer experience.

What should be done to improve the healthcare market, including the role of health insurance in order to serve the customer better?

Since Indian consumers still do not see any return in health insurance unlike life insurance policies, the value perception of health insurance has not made a mark. This is a constraint as far as health insurance penetration is concerned. There are two important aspects about the perception the service and the product. The perceptions about the array of services that a health insurance provider offers are not very clear. Now, most insurers are beginning to communicate consistently about products and thus, addressing the somewhat stilted communication. Health insurance companies must realise that being approachable and transparent will play a crucial role in helping customers manage their health proactively.

The health insurance portfolio has been a loss-making portfolio for almost all general insurers. Is there anything wrong in the way it is currently managed?

The health insurance industry is in its initial stages and as it grows, it will follow the same lifecycle as the life insurance industry. For the industry to grow, it is important to develop a strong relationship between the insurance provider, customers and healthcare providers. Health insurance products deal with aspects of health and that require a detailed explanation and a more personalised approach. Health insurance products need to be more comprehensive and transparent and have minimal fineprint to ensure good value delivered to customers. Companies need to address issues related to servicing and low product innovation.

Do you plan to provide extra benefits, since your local partner has a chain of hospitals?

We have a network of 600 quality hospitals across the country, and these offer cashless services. Max Hospitals are a part of our network. Since they it is a group company, it allows us to share best practices and look for areas in which we can work together. We want to partner all our network hospitals in helping our customers live healthier and more successful lives.

How competitive will your pricing be?

We offer products to suit different target groups. Under Heartbeat, our customers can choose an individual or family cover across price bands from Rs 2 lakh to Rs 50 lakh. We also have a transparent pricing system.

What kind of customers, products, and premiums are you looking at in the next two years?

Despite being a new entrant in the health insurance space, we are encouraged by the excellent response from the market. We have recently completed over 10,000 policies and covered over 15,000 lives in less than 200 days of beginning operations and are sure that going ahead, we will see good traction. We are working towards earning our customers' trust and providing value to customers as well as our shareholders.

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Wipro arm eyes deals in insurance business

Wednesday November 10, 02:20 PM Source: Indian Express Finance By TickerNews

Wipro (WIPRO.NS : 418.3 +17.45) Infotech-India and West Asia business of Wipro Technologies-is eyeing information technology contracts from private insurance companies in India, a top official said.

Wipro Technologies is the IT services business of Wipro. "Private insurance companies are looking at it (outsourcing). We have started talking to them about it," said Anand Sankaran, senior vice-president and business head, Wipro Infotech.

The contracts could be finalised in the next 12 months and are likely to be integrated deals comprising business process outsourcing as well as information technology services, Sankaran said.

He, however, declined to comment on the deal sizes.

"It's too early to say how things will pan out. Lot of people are looking at options, talking to technology vendors, seeing what suits them best. It's early days still," he said. He also declined to name companies Wipro is in talks with.

In its latest draft guidelines on outsourcing activities for insurance companies, Insurance Regulatory and Development Authority said insurers can outsource human resource services, pay roll management, tele-marketing, call centre for registering complaints or answering enquiries among other services.

Potential for business growth from the insurance sector is strong for software companies, Sankaran said. "For technology vendors, the insurance sector in India at present is similar to what the telecom sector was three to five years ago," he said.

In the past couple of years, Wipro Infotech has won big-ticket deals from mobile services providers. In 2008, the company won a nine-year integrated outsourcing deal from Aircel. It won another large nine-year deal from Uninor in 2009. In 2010-11 (April-June), Wipro Infotech aims to grow 50% faster than the Indian market, which is growing at 15-17%, he said.

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HDFC to infuse 1 bln rupees in insurance JV in FY12

MUMBAI (Reuters) - HDFC Ltd over the next six months will infuse 500 million rupees ($11.27 million) in HDFC Standard Life, a leading Indian private insurer, its chairman said on Tuesday.

It will also infuse 1 billion rupees in the insurance firm, a joint venture between HDFC and Britain's Standard Life, in the next fiscal year, Chairman Deepak Parekh told reporters.

(Reporting by Nandita Bose; Editing by Bryson Hull)

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US sees 141 bank failures in just 11 months

Source: Indian Express Finance By Agencies

In signs of continuing financial woes, a staggering 141 American banks have gone belly up so far this year, surpassing the total count of bank failures in 2009.

The world's largest economy saw the collapse of 140 banks last year, at a time when the country exited one of the worst recessions.

Four banks -- Western Commercial Bank, Pierce Commercial Bank, First Vietnamese American Bank and K Bank -- were shut down by the authorities on November 5.

According to the Federal Deposit Insurance Corporation (FDIC), which insures deposits at over 8,000 American banks, the latest failures would cost more than USD 254 million.

In October alone, 12 banks went out of business.

Seven banks were closed down in September, while August saw the failure of ten entities. The maximum number of failures this year happened in April, when 23 entities went belly up.

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Hospital chains call for insurance deal with US

Source: Indian Express Finance By Soma Das

Leading hospital chains in India have a unique proposal for US President Barack Obama when he visits India this weekend. These healthcare providers are seeking to put in place a formalised process between the two countries whereby willing US patients can claim reimbursements from their US-based health insurers even when they decide to get their medical procedures done in reputed hospitals in India.

To start with, a pilot of the mechanism could be tested on US citizens of Indian or South Asian origin who divide time between the two countries and volunteer for such a policy. This, Indian healthcare providers maintain, could significantly contribute towards Obama's goal of reducing healthcare costs in the US.

"With the healthcare costs so high in the US and considering that a large number of Americans do come to India for treatment, President Obama can look at leveraging the high quality, low-cost healthcare model of India and open new vistas for US patients," said Vishal Bali, CEO, Fortis Hospitals. "That can be achieved when the health insurance firms in US can be persuaded to allow the US citizens to avail of medical services in India and still claim reimbursements," Bali added.

Max Healthcare CEO Pervez Ahmed feels the same: "The feasibility of this model can be tested by first letting US patients of South Asian origin avail of it. We meet many elderly US citizens of Indian origin who spend a substantial part of the year here. But these people have to insure themselves separately at both places. In fact, Medicare, the US government's social insurance programme that provides health insurance coverage to elderly people and other special sections of the population is an apt platform to pioneer such a pilot project," he told FE.

Bali, whose hospital chain has begun exploring the idea by reaching out to US insurers and working with a self-funded employers' group in US, said that if such a model gets government backing, it would showcase Indian healthcare providers' compliance with global benchmarks of quality and automatically spur more patients inflow from US, apart from reducing overall healthcare costs in the US.

In India, most common medical procedures cost less than one-sixth in the US. A liver transplant costs above $300,000 in the US, while it costs around $60,000 in India. While a coronary artery bypass graft costs $35,000 in US, it costs $8,500 in India.

In the US, a patient has to shell out over $50,000 for a joint replacement, while the same can be done for $12,000 in India. Similarly, hip replacement surgeries which cost over $23,000 in the US cost around $8,500 here. Price differences in cosmetic surgeries are even higher. Max's Ahmad said such an insurance policy would obviously have to work out many finer details with a differentiated approach towards elective procedures and emergency services. Bali feels that in the era of globalisation and global citizens, this model is inevitable between countries to cross-benefit from each others' core competence.

With the US spending 17% of its GDP on healthcare in 2009 with its annual healthcare expenses over $2 trillion, the highest among all developed countries, Obama is taking multiple steps to lower the country's healthcare costs. According to the non-partisan Congressional Budget Office, the US would be spending 25% of its GDP on healthcare by 2025. However, lawyers FE spoke to feel that in such cross-country agreements, determining legal jurisdiction in the case of hospital and doctor liabilities could play spoilsport.

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Lupin, Ranbaxy sued for overcharging

Wednesday November 3, 01:40 PM Source: Indian Express Finance By Soma Das

Two of the country's top drugmakers, Ranbaxy Labs and Lupin have been sued by the US state Louisiana's attorney general in a US district court for allegedly overcharging the state insurance programme, Medicaid, with full intent while supplying prescription drugs.

The names of these firms figure along side 16 other pharma firms (that includes Abbott, Watson Pharma, Forest Labs Inc, Baxter International) named in the lawsuit filed by attorney general James Buddy Caldwell who claims that these drug makers "knowingly, willfully, want only and/or intentionally" provided false inflated pricing information related to their drugs to various drug industry reporting services.

The lawsuit further claims that this 'inflated pricing information' far exceeded the 'actual prices' at which these firms sold their drugs to non-government players such as retailers, physicians, hospitals, pharmacies and even wholesalers. Louisiana Medicaid reimbursed pharma companies at rates derived from this artificially inflated prices, the lawsuit said.

Both Ranbaxy and Lupin spokesperson did not respond to FE queries till the time of going to the press.

The suit alleges that by overcharging these firms have violated the Louisiana Unfair Trade Practices and Consumer Protection Act, Louisiana's Anti-trust Statute, Louisiana's Medical Assistance Programmes Integrity law among others.

Caldwell said by indulging in such practices, the companies were creating something called a 'spread'. The term 'spread' is commonly used by the firms to indicate this difference between the reported pricing information and the actual price of a drug, the lawsuit added. Through this mechanism, the firms intend to increase their sales and market share in case of the drugs involved, Caldwell argues. It is at the behest of these drug firms, that private retailers got persuaded that a larger spread would mean more profit for them from the reimbursement system, earned at the expense of the state exchequers.

The suit has sought recoveries of the entire overcharged amount with accumulated interest along with damages, fines and penalties.

"This is an egregious abuse of the Medicaid reimbursement system. We believe Louisiana has lost hundreds of millions of dollars as a result of these drug companies' fraudulent pricing schemes," a Caldwell statement submitted. Caldwell has had some past success in suing pharma firms. Late last month a jury in Louisiana ruled on a Caldwell suit that Johnson & Johnson owed the state nearly $258 million for misleading state doctors about the possible side effects of Risperdal, an antipsychotic medication. Before that in April ,Caldwell said that Louisiana managed to get $20 million in a settlement with pharmaceutical firm Eli Lilly, again over over its marketing of the anti-psychotic drug Zyprexa. At the time, Caldwell had said, "This settlement sends a clear message to pharmaceutical companies that improper and illegal marketing of drugs will not be tolerated in Louisiana". Incidentally, Louisiana has a governor of Indian origin, Bobby Jindal.

View the original article here

IRDA slaps Rs 10L fine on Reliance Life

Wednesday November 17, 05:33 PM Source: Indian Express Finance

The Insurance Regulatory and Development Authority (IRDA) has imposed a fine of Rs 10 lakh on Anil Ambani Group company Reliance Life Insurance Company for violating the norms.

In an order issued by IRDA chairman J Hari Narayan which was posted on the official website of the regulator, Reliance Life was directed to pay the penalty for paying excess referral fees and not following the regulatory guidelines with respect to group products.

The insurance regulator has observed that Reliance Life had paid excess referral fees than envisaged in the referral guideline. In its reply to the IRDA, the company had agreed for the lapses and said that these fees were paid in anticipation of business volumes to be generated as per initial commitments. "The company is directed to pay a penalty of Rs 5 lakh for the violation and cautioned to ensure that they adhere strictly to the guidelines in future," the IRDA said.

The regulator has said that the company has deviated in the "F&U procedure" particularly in group products and the comments received from the company on this was not satisfactory. "The company is directed to pay a penalty of Rs 5 lakh for the violation and cautioned to ensure that they adhere strictly to the guidelines in future," IRDA said.

View the original article here

How to revive a lapsed insurance policy

Source: Indian Express Finance By Adhil Shetty

Some of us like our life laid back! That is fine if you are someone who is slow but steady in this fast paced era. However, if you add a heavy dose of procrastination to the mix, it could be lethal to your own best interests. Let us consider what happens to someone just like this who forgot to pay up his insurance premium after procrastinating on the dates for a while. Thankfully for him there were loopholes to make amends. Read on to figure how!

Ajay, 32, has been going through an old bunch of documents, and comes across an insurance policy he had taken when he was 28, but had completely forgotten about. The first (and only) annual premium paid was Rs 8,000, and he's now feeling bad that the money paid has gone down the drain. Or, has it?

Grace period

Generally, there is a grace period for paying your insurance premiums - a period of one month. During this period, the policy remains valid. However, beyond one month, the policy lapses, and no claims will be entertained by the insurance company.

Revive an old policy

In Ajay's case, the policy ceased to be in force for three years, so he is not within the grace period. Yet, he can still revive his policy, since an insurace policy can be revived within five years from the date of the last unpaid premium. What Ajay needs to do is contact the insurance company, submit a declaration of health from a doctor recognised by the company, and pay the unpaid premiums along with a late payment penalty.

Benefits

What benefit would Ajay get out of reviving an old policy? For one, he would get the benefit of having to pay regular premiums calculated when he was 28 - which would be less than the premium for a similar, new policy taken at the age of 32. He will enjoy all the benefits and guraranteed returns of the policy as was promised to him four years ago. Also, he benefits from tax deduction under Section 80C for the entire payment made towards arrears in premium payment, not counting the penalty.

On the other hand, if Ajay decides not to revive the policy, he would lose the money he has paid as premium. If Ajay had paid his premiums for three years before discontinuing the policy, he would still have received the amount paid as premium along with pro-rata accrued bonuses at the end of the policy term.

Doing it right!

Ajay's twin, Vijay, is more meticulous. He has a similar policy, issued at the same time as Ajay's, and his policy is still active. This, even though he has been out of the country for the last two years. How did he manage that? Well, being meticulous, the first thing Vijay did was set up an ECS facility with his bank in India and every year his premiums get paid directly, without his intervention. Knowing how careless his brother is, he has some advice for Ajay:

- Ajay should update his correspondence address, contact numbers and email address with his insurance company when there is a change, so that they can send him reminders about due dates.

- Ajay should also check with his insurance company if they have SMS alert facilities - this would ensure that he gets reminders by SMS.

- Like Vijay, Ajay could set up an ECS facility with his bank (as long as he remembers to have the money in his account whenever his premium is due!).

Author is CEO of BankBazar.com

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Insurers can't outsource work; M&A norms soon

Wednesday November 10, 04:15 PM Source: Indian Express Finance By fe Bureau

New guidelines for mergers and acquisitions among non-life insurance companies are expected soon with the Insurance Regulatory Development Authority (Irda) initiating the process after receiving proposals for the same from two non-life insurance companies.

Also, Irda came out with guidelines on outsourcing by all insurers, both in life and general, which will come into practice with immediate effect. Insurers will have to terminate all outsourcing especially core activities such as investment, underwriting and policy servicing to third-party companies. "With regard to merger among non-life insurance companies, even though there's no specific provision in the enactment (Insurance Act), there is one certain specific circumstance where Irda could direct a merger. Other than the genuine provision, there are no specific guidelines required for the M&A process," Irda chairman J Hari Narayan said after launching an SMS-based customer care initiative by SBI (SBIN.NS : 3039.85 +48.9) Life here. "We have received M&A proposals from two non-life insurance firms and are evaluating the same. As far as M&A guidelines for life insurance companies are concerned, there's already a provision in the Insurance Act. We are examining the two proposals that will set the blueprint for guidelines for M&As among non-life companies," he said. There are about 22 life insurance companies and 21 non-life insurance companies operating in the country. The proposed norms are expected to spur consolidation leading to fewer but stronger players in the insurance sector.

Talking about the regulator's near-term goal, the chairman said Irda is working to enhance policy holder protection.

Further, to streamline the health insurance norms, Irda has formed six working groups under the umbrella of Ficci and CII to look at various aspects of health insurance.

View the original article here

Irda imposes Rs 10-lakh fine on Reliance Life Insurance

Wednesday November 17, 03:35 AM Source: Indian Express Finance By fe Bureau

The Insurance Regulatory & Development Authority (Irda ) has slapped a fine of Rs 10 lakh on Reliance Life Insurance Company for violating some of the norms laid down by the regulating authority.

A showcause notice was issued to Reliance Life for having paid excess referral fees than envisaged in the referral guidelines. In its reply, the company has agreed for this lapse and informs that the fees was paid in anticipation of business volumes to be generated as per initial commitments. This is in violation of the laid down provisions of the guidelines, according to Irda.

Irda also observed that the company opened many offices without taking the necessary approvals.

Irda noted that Reliance Life Insurance Company has contracted business in a unit with an identifiable code number relating to a branch, for which no approval of Irda has been accorded. Their contention that such booking of business was only for the purposes of MIS for internal monitoring is not acceptable, Irda noted. If the intention was to establish whether opening of a branch office would be viable at a given location, such an assessment could have been done by other means. There are several examples where branches occupy the same building and quite often the same floor of a building, observes Irda.

It is also noted by the Irda inspection team that the Reliance Life Insurance Company has outsourced key jobs related to issue of licences and thus violated the laid down procedures. Reliance Life Insurance Company informs that co-sourcing of licensing process was a legacy of AMP Sanmar Life Insurance Company in the past.

In its reply, the company informs they had stopped the outsourcing process after it had transitioned the entire process to Mumbai and they had not outsourced any of the activities related to licencing. However, the insurer is cautioned not to outsource any of the activities involved in issue and renewal of licenses in future, Irda said.

Irda also saw deviations in the F & U procedure particularly in group products in violation of certain circulars.

View the original article here

ANALYSIS - Insurance industry misses technology opportunity

Saturday November 20, 12:30 AM

By Ben Berkowitz

NEW YORK (Reuters) - Most insurers are letting consumer technology like smartphones and social media networks get ahead of them, creating a challenge to attract a new generation of customers who are not interested in doing business with agents the way their parents did.

But it has also created an opportunity for companies like Allstate and State Farm which have embraced interactive technologies as a way to extend their brand's reach to children of the 1980s and 1990s.

"You're not going to get any more mortality (business) with the things you're doing now" among the younger generation, said Douglas French, managing principal of Ernst & Young's insurance advisory practice, told reporters recently.

While the insurance industry is known for many things, an orientation toward the young and/or hip customer is not one of them. In some ways this contrasts strongly with banks, which are offering check deposit via cell phone and pushing the Internet to replace branches for much of their business.

Catchy advertising gimmicks like Aflac's spirited duck or Geico's cavemen notwithstanding, underwriters usually aim their pitches at a middle-aged customer seeking an aura of confident authority about matters like health and property.

While that has continued to work among a segment of the market, branding experts say there is a missed opportunity.

"It's a buggy whip mentality. Everything is moving more and more to high-tech electronic online interface and particularly with this generation," said Robert Passikoff, president of brand loyalty and customer metrics researcher Brand Keys.

"They're still looking at this as a commodity ... if we can get the price down low enough, people will come to us and I don't need a lot of friends on Twitter and Facebook."

FEW BRIGHT SPOTS

There are some companies in the industry that have been more aggressive with their push into new media, though mostly in automotive insurance. Industry executives say auto insurance lends itself to new media because the transactions are in some ways simpler than other insurance lines.

Allstate has a suite of mobile applications for smartphones that offer services like home inventory lists and roadside assistance requests.

"A very significant number, up to a majority, of wireless users will have these devices with them and they expect to be able to interact with companies through these devices where they are," said Bob Wasserman, vice president of e-business for Allstate. "You start to think about what this device can do and you build other capabilities."

State Farm is just as active, with prominent links off its home page to Twitter, Facebook and Flickr feeds and a suite of mobile applications for customers, though they are still just a supplement to the company's traditional network of agents in storefronts across the country.

Berkshire Hathaway's Geico is also aggressive in mobile, offers an application that lets people obtain rate quotes by taking a picture of their drivers license among its lineup of phone applications.

No matter what channel they are using, the auto insurers seem to have picked up on an idea that other insurers have missed: younger customers don't want to go to an agent's office and don't want to be sold products where they already know they can get a better price elsewhere.

Brand Keys' Passikoff said that shift in thinking could take a decade for insurers to really make, but some say that may not be sufficiently aggressive.

"I don't see the industry moving fast enough," said Bill Chrnelich, a partner in PricewaterhouseCoopers' insurance practice, in a recent interview. "This industry isn't focused enough on that change in their sales and distribution."

(Reporting by Ben Berkowitz, editing by Matthew Lewis)

View the original article here

AIG posts massive loss on sale, goodwill charges

NEW YORK (Reuters) - Bailed-out insurer American International Group lost more than $2 billion in the third quarter as charges for the discount sale of its consumer finance unit offset growth in its general insurance business.

AIG had warned in August that the sale of a majority stake in American General Finance to Fortress Investment Group would lead to a $1.9 billion pretax loss. Although the sale price was not disclosed, it was characterized as a "very small fraction" of the value of the business.

AIG reported a third-quarter loss of $2.4 billion, or $17.62 per share, compared with a year-earlier profit of $455 million, or 68 cents per share. Besides the American General Finance loss, AIG also took two charges of more than $1 billion each, for goodwill and tax items.

Operating results, stripping out extraordinary items and discontinued operations, came in at a loss of $200 million, or $1.47 per share.

The two analysts reporting estimates to Thomson Reuters I/B/E/S given earnings-per-share forecasts of 58 cents and $1.35.

(Reporting by Ben Berkowitz; Editing by Lisa Von Ahn)

View the original article here

Easy norms to help banks infuse extra capital in insurance arms...

Wednesday November 3, 04:02 AM Source: Indian Express Finance By fe Bureau

In a bid to help banks to infuse additional capital in their insurance subsidiaries, the Reserve Bank of India (RBI) has said the entire investments in the paid up equity of the subsidiaries (including insurance entities), will be deducted at 50% from tier-I and 50% from tier-II capital.

"Earlier the entire amount which the bank was investing in insurance companies was getting deducted from tier-I for calculating the capital adequacy of the parent banks, but now will be deducted equally both from tier-I and II. In this way the banks will be in a position to infuse more capital to the insurance subsidiaries,'' said Ashvin Prekh, partner, national leader, global financial services, Ernst & Young.

RBI has also reduced the investment threshold in subsidiaries to 20% from 30% for applying its new norms.

RBI had constituted an internal group on the supervision of financial conglomerates (FCs) in the country. The internal group had made various recommendations for strengthening the supervision of the FCs, including changes in certain regulatory norms.

As per Basel II framework, investments in the equity of subsidiaries or significant minority investments in banking, securities and other financial entities, where control does not exist, together with other regulatory capital investment in these entities are required to be excluded from the banking group's capital if these entities are not consolidated.

Accordingly, RBI has proposed that the entire investments in the paid up equity of the entities (including insurance entities), where such investment exceeds 20% of the paid up equity of such entities will be deducted at 50% from tier-I and 50% from tier-II capital when these are not consolidated for capital purposes with the bank. In addition, entire investments in other instruments eligible for regulatory capital status in these entities shall also be deducted at 50% from tier-I and 50% from tier-II capital; and the deductions indicated above will also be applicable while computing capital adequacy ratio of the bank on a solo basis.

The capital adequacy requirement will be further calibrated after finalisation of the Basel III rules.

Also, in order to limit the inter-connectedness between the bank and other group entities, the central bank has proposed to put in place an appropriate limit for such transactions and exposures, both for a single entity and on an aggregate basis for all other group entities.

The detailed guidelines in this regard will be issued separately.

View the original article here

Irda's rural biz norms put LIC on backfoot

Wednesday November 17, 03:34 AM Source: Indian Express Finance By Kumud Das

The stringent norms of Insurance Regulatory & Development Authority (Irda) on rural business has put the state-owned Life Insurance Corporation (LIC) on the back foot in expanding its rural business .

Irda norms make it mandatory for the life insurers to generate at least 25% of total business from the rural regions. The norms alternatively say that the life insurers have to each year improve their rural business by 2%. The life insurers who fail to comply with the regulations have to pay a penalty of Rs 5 lakh. LIC which has already achieved the mandatory 25% target in rural business sometime back and has crossed 31% in the current year is reluctant to grow the business further as it has to set a new bench mark for the next year. "Doing rural business is not easy. It would be difficult to grow the business 2% more than the earlier year each time. This rule rather puts a restriction in expanding our rural business,'' said a senior LIC official In fact LIC had earlier paid a penalty of Rs 5 lakh as it had failed to comply with the rural business norms.

LIC has already done 31% business from the rural areas in the current fiscal. Last year, the corporation had done 27% business in the remote parts of the country. However, with the stringent IRDA norms, the corporation will have no option but to shelve its rural business plans. "We have got a bigger base and we have been increasing our base in the rural areas each year too. But, if Irda wants us to increase our rural base by 2% as compared to our earlier achievement, then it will be quite difficult for us,'' said the official.

View the original article here

Life insurers' premium rises 23% on new biz

Thursday November 11, 01:49 PM Source: Indian Express Finance By fe Bureau

The total premium of life insurance industry rose by 23% to Rs 1,25,254 crore as of September 2010 against the same period in the previous year, said Life Insurance Council, the official representative body of life insurers in the country. The growth is due to an increase in the new business premium, which rose by 60% and also a strong show put up by Life Insurance Corporation.

The growth is all the more noticeable since the said period was marked by significant changes in product profile of unit-linked insurance plans. However, the renewal premium continues to remain flat with a marginal increase in traditional business.

As a consequence of changes made in Ulip policies, there has been an increase in average annual premium and average sum assured per policy. The average premium per policy for non-single product has increased from Rs 10,233 (September 2009) to Rs 12,887 (September 2010).

Single-premium products have also shown healthy growth of 123% from Rs 7,732 crore as of September 2009 to Rs 17,267 crore as of September 2010. Private sector life insurers pruned man power base, branch network and agency force in a bid to cut down their expenses. While private sector insurers opted for austerity drive in order to meet changed environment of low margins under Ulip products, state-owned Life Insurance Corporation added 70 offices to network, said Life Insurance Council.

During the six months ended September 2010, private sector insurers shut down 90 offices, laid off 5,480 employees and slashed their agency force by 1,56,675. This was reflected in the cost and overall cost ratio, which came down from 10.34% as of September 2009 to 9.48% as of September 2010. Commission ratio also came down from 6.23% to 5.43% in the said period.

Sounding cautiously optimistic about the future, S B Mathur, secretary general, Life Insurance Council, said, "While the numbers reflect well, it is better to be cautious about immediate future. Some of the private players might take some more time to get adjusted to the new regulatory framework. The overall scenario appears positive and I foresee growth for the industry to be sustained in the coming years."

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traditional plans versus ULIPS

traditional plans versus ULIPS | insurance blog #indicimelayer {border: 1px solid black; padding: 3px; font-size:10px;font-family: verdana, arial, helvetica, sans-serif; position:fixed; background-color:white; top:80px; right:2px; text-align:right;display:inline; z-index:1002;}* html #indicimelayer{position: absolute; top: expression(document.compatMode=="CSS1Compat"? document.documentElement.scrollTop+2+"px" : body.scrollTop+2+"px"); }.mu_register #password_1,.mu_register #password_2 { width:100%; font-size: 24px; margin:5px 0; }#wp-admin-bar{position: absolute;top: 0;left: 0;height:20px;width:100%;background-image: url(http://blog.co.in/wp-content/admin-bar-bg.jpg);font-size:9px;color:#333333;font-family:Verdana;}.wp-admin-bar_table{ margin:0; padding:0; border:0; font-size:9px;}#wp-admin-bar a, a:hover{ color:#333333; border:0px text-decoration:none; border-bottom:none;}.wp-admin-bar_table a, a:hover{ color:#333333; text-decoration:none; border:0px border-bottom:none;}.wp-admin-bar_table td, th{padding:0px;vertical-align:middle;font-size:9px;}.wp-admin-bar_table th{font-weight:normal;font-size:9px;}.wp-admin-bar_table td {border:0px;font-size:9px;}   Create Free Blog | Random Blog »   Report Abuse | Login   
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traditional plans versus ULIPSApril 28th, 2009indian insurane7 Comments

TRADITIONAL PLANS are long duration plans which needs paying premium over a long period starting from minimum 5 years to maximum 60 years. If the policy is lapsed once, you may not get returns.

 7 Comments BendzJanuary 1st, 2010 at 11:50 pm

You’re great. But A lot of people have no idea about short term insurance plans and other related information. Cool info.
international insurance web world
 Rayudu KrishnaraoApril 23rd, 2010 at 10:34 am

Anything & Everything in Insurance..
Vashi Navi Mumbai.
9867362022.

http://rayudukrishnarao.blogspot.com/
 Rayudu KrishnaraoApril 23rd, 2010 at 10:36 am

http://rayudukrishnarao.blogspot.com/

Anything & EVerything in Insurance.

Vashi Navi Mumbai. 400703.
 Rayudu KrishnaraoApril 23rd, 2010 at 10:37 am

Anything & EVerything in Insurance. Rayudu Krishn arao, 9867362022.

Vashi Navi Mumbai.
 BendzJuly 27th, 2010 at 1:32 pm

Hi,
Good information. Many people not aware about insurance policies. If you’ve got time, visit my insurance blog.
Cool blog and Keep it up.

 akhilendraAugust 27th, 2010 at 6:16 pm

great post, lot of good information
 insorenceOctober 15th, 2010 at 4:54 pm

I posted your button to my blog. I tried to send a message to the email address you had listed but it wouldn’t allow it so I am posting here and on your FACEBOOK page. Thanks!
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insurance sector in india

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great thoughts for success in business

GREAT QUOTES FOR SUCCESS IN YOUR LIFE

 A friend is someone who will do anything to cheer you up;

a friend is someone who makes you feel warm all the time.

Learn from the mistakes of others, you can’t live long enough to make them all yourself.

 If people are trying to full you down, be proud about it, because it only confirms that you are above them, your attitude rock. Any day if you are depressed or confused or hurt, don’t worry. Just go in front of the mirror, you will find a beautiful best person who can solve all your problems.

There is only one happiness in life; To Love and To Be Loved.

The journey of thousand miles with a single step,

Break your goals What matters is how you see yourself.

Just BE Be strong enough to face the world each day,

Be weak to know you can’t do everything alone,

Be generous to those who needs your help,

Be frugal with what you need yourself,

Be wise enough to know that you do not know everything,

Be foolish enough to believe in miracles happens rarely,

Be willing to share your joys, Be willing to share the sorrows of others,

 Be a leader when you see a path others have missed,

Be a follower when you are shrouded in the midst of uncertainity,

Be the first one to congratulate the opponent, who succeeds,

Be the last to criticize a colleague, who fails,

Be sure of your final destination, in case you are going the wrong way,

Be loving to those who love you,

Be loving to those who do not love you, they may change,

Above all the most important is Be true to yourself.

In the end of the day,

3 things matters a lot;

 How fully you lived

How deeply you loved

and How well you learnt to let go off the things not meant for you.

Every minute is a challenge. Every challenge is an opportunity.

Every opportunity is a goal. Every goal is a chance.

A single chance can change your life So live up to your expectation,

every minute of your life It’s not how much we do,

it’s all how much love we put into doing it,

 What do you do today is getting you closer to where you want to be tomorrow.

At the age of 20, we think of what others think us,

At the age 40, we do not care what they can think of us,

At the age 60, we discover that they have not been thinking of us.

The best day is TODAY

 The hardest thing to do is TO BEGIN

Easiest thing to do is FINDING FAULTS

The greatest mistake is to GIVE UP.

Most useless asset is PRIDE Most useful asset is HUMILITY

 Greatest need is COMMON SENSE Best gift is FORGIVENESS

The hardest and most painful ting to accept is DEFEAT

The greatest knowledge is EXPERIENCE

The greatest success in the world is PEACE OF MIND

 The size of our problems is nothing compared with our ability to solve them ,

but by over estimating the problem we under estimate our ability.

ABC’s of HAPPINESS

? Aspire to reach your potential ? Believe in yourself ? Create a good life ? Dream about what you want to become ? Exercise frequently ? Forgive honest mistakes ? Glorify the creative spirit ? Humor yourself and others ? Imagine great things ? Joyfully live each day ? Kindly help needy people ? Love your enemies as well friends and people around you ? Meditate daily ? Nurture the environment ? Organize for harmonious action ? Praise good performance of others ? Question most things ? Regulate your own behavior ? Smile often ? Think rationally ? Understand yourself ? Value the spirit of life ? Work for the common good ? X-ray and carefully examine the problems ? Yearn to improve ? Zestfully pursue happiness Prominent statement by an eminent personality

“The educated man of yesterday who stops learning today becomes uneducated tomorrow.

Every effort is never wasted even when it leads to disappointing results. Because it always makes you stronger, perfect and experienced. Forget your past glory and achievements. Aim higher for excellence. Do not stand too much in front of the mirror Even mirror will fall in love with you. For more jokes please mail JOKES to shivusira.webs.com@gmail.com

LOVE POEMS FOR SUCCESS IN LOVE

 All I ever wanted was to be part of your heart, And for us to be together, to never be apart. No one else in the world can even compare, You’re perfect and so is this love that we share. We have so much more than I ever thought we would, I love you more than I ever thought I could. I promise to give you all I have to give, I’ll do anything for you as long as I live. In your eyes I see our present, our future and past, By the way you look at me I know we will last. I hope that one day you’ll come to realize, How perfect you are when seen through my eyes. If I could have just one wish, I would wish to wake up every day, to the sound of your breath on my neck, the warmth of your lips on my cheek, the touch of your fingers on my skin, and the feel of your heart beating with mine… Knowing that I could never find that feeling with anyone other than you love the way you look at me, Your eyes so bright and blue. I love the way you kiss me, Your lips so soft and smooth. I love the way you make me so happy, And the ways you show you care. I love the way you say, “I Love You,” And the way you’re always there.

I love the way you touch me, Always sending chills down my spine. I love that you are with me, And glad that you are mine. Love is the greatest feeling, Love is like a play, Love is what I feel for you, Each and every day, Love is like a smile, Love is like a song, Love is a great emotion, That keeps us going strong, I love you with my heart, My body and my soul, I love the way I keep loving, Like a love I can’t control, So remember when your eyes meet mine, I love you with all my heart, And I have poured my entire soul into you, Right from the very start. My love is like an ocean it goes down so deep my love is like a rose whose beauty you want to keep. My love is like a river that will never end my love is like a dove with a beautiful message to send. My love is like a song that goes on and on forever my love is like a prisoner it’s to you that I surrender

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greatthoughts for success in business and life

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Wikio Health: November Rankings

The good news is that we’ve been asked once again to (exclusively!) publish this month's rankings for Wikio's Health blog category.

The bad news is that we've slipped a bit, down several spots to #17, but still solidly in the Top 20.

Not bad for an insurance blog, I'd say.

And now, without further ado, your November Wikio Health Blog Rankings:

Health

Ranking made by Wikio

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The MVNHS©: Dying young

Proponents of ObamaCare© like to point to the Brits' health care scheme as an exemplar of gummint-run health care. The argument seems to be that the MVNHS© does sooo much better than our system, allowing folks to live longer lives as a result.

Turns out, not so much:

"Americans, aged 65, can expect to live on average around three months longer than their equivalent retirees across the Atlantic."

Ooops.

This despite our (allegedly) higher rate of diabetes and cancer. The fact is, our system is much more adept at effectively treating these diseases, resulting in better outcomes across a broader spectrum. For those who think we're not getting our own money's worth, I give you Jim Smith, a senior economist at US-based think tank Rand Corporation:

"We are spending twice as much as England on health and we are getting the benefit of the extra years of life."

That is, until Mr Berwick gets through with us.

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Outstanding Food Pyramid News

This is just tremendous news for those of us struggling to find an effective, simple way to shed pounds:

"Twinkies. Nutty bars. Powdered donuts ... For 10 weeks, Mark Haub, a professor of human nutrition ... ate one of these sugary cakelets every three hours, instead of meals. To add variety in his steady stream of Hostess and Little Debbie snacks, Haub munched on Doritos chips, sugary cereals and Oreos, too ... His body mass index went from 28.8, considered overweight, to 24.9, which is normal ... Haub's "bad" cholesterol, or LDL, dropped 20 percent and his "good" cholesterol, or HDL, increased by 20 percent."

Count me in!

[Hat Tip: FoIB Tom T]

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Tuesday Afternoon Linkfest

First up, regular readers may recall our recent post on John Hancock's substantial (unprecedented?) rate hike. Thanks to FoIB Jeff M, we learn that they've also announced a moratorium on new group LTCi cases. Not to be outdone, fellow LTCi biggie GenWorth has announced that it's "seeking an increase of 18% on PCS I and PCS II LTC products." They cite "lower than expected lapse rates."

That's an interesting point, by the way: rates are set based on a number of factors, and most of us would recognize things like return on investments and overall claims costs to be near the top. But carriers also have a "fudge factor" built in that relies on a certain percentage of policyowners "bailing" over time; that this rush to get out of the pool never materialized is telling.

Second, FoIB Bob D alerts us to thus far under-the-radar news that many of the newly-minted Republican governors are on track to opt out of ObamaCare©. According to the Wall Street Journal's Janet Adamy:

"Newly elected Republican governors are planning to blunt key parts of the federal health overhaul and join lawsuits against it ... Mr. Walker, along with new GOP governors in Wyoming and Oklahoma, said they planned to join in the legal fights against the law's requirement that most Americans carry insurance or pay a fine."

Good on them!

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Timing is everything...

In email from UHC/Golden Rule (I'm still a bit confused on the branding), Vice President of Sales Susan Fowler has some news about that carrier's rate guarantees. Up 'til now, the default rate guarantee was 12 months; concerned buyers could opt to "buy up" to a 24 month lock-in. As with most carriers, that initial 12 month guarantee had a CYA clause: moving to a new area or changing benefits voided it (which makes sense).

As a result of ObamaCare©, though, the company has made some substantive changes to the underlying guarantee; those whose plans were effective on or after September 23rd will see no change (for now). But those whose plans pre-dated the 23rd are going to get hot with some unexpected "change:"

¦ They will receive additional health reform benefits as of 1/01/11.

¦ These customers will experience a rate change due to the additional benefits provided.

That's because, as we've pointed out before, even so-called "grandfathered" plans are not immune to some of the changes, which will necessarily result in higher rates (although how high is still not known).

But remember, "if you like your current plan..."

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Pee on the MVNHS©? There's an app for that!

Insurance Issues, Principles & Solutions

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Dear Congress

Last night was really something, wasn't it? Some political races decided while others have gone into overtime.

Voters wanted to send a message to Washington and they did so in a resounding fashion. It seems every time the country moves too far in either direction, but especially to the left, there is a correction.

The voters sent a message to FDR in 1938 shortly after instituting Social Security. Roosevelt's autocratic way of dealing with things was viewed as too extreme.

Same thing 10 years later under Truman and more recently in 1994 as a reaction to Clinton.

While the economy and jobs are major concerns the debate over health care reform (Obamacare) just won't go away and very few are pleased with what has been foisted on us. What Washington gave us was 2200 pages of laws and tax increases that do little or nothing to reduce the cost of health insurance and nothing to impact the cost of health care.

There are two ways to reduce the cost of health care, and neither involve simply telling medical providers what you are willing to pay for their services.

Roughly 70% of chronic illness can be prevented or reversed by diet and exercise. We are an nation of unfit, lazy slobs who would rather take a pill for what ails us than actually put forth effort and get off our butts. Until that attitude changes we will continue marching toward obesity and all the ailments that accompany it such as hypertension, high cholesterol, heart disease and diabetes.

Most of those conditions are a result of lifestyle, not genetics or environment.

We can reduce total health care expenditures by eliminating incentives to abuse health care funding. Health insurance is the only form of insurance where no one knows, or cares, how much a procedure or medication costs. There is no reason for the insured to ask since health insurance pays over 85% of the cost of care.

We have automobile insurance to protect us against theft or major damages. Our car insurance does not pay for tires, brakes or oil changes and if it did, auto insurance premiums would break the bank.

But some feel they cannot afford to go to the doctor or fill a prescription without a copay. Until 20 years ago health insurance did not have copay's.

We have become conditioned into thinking health care is not attainable unless our exposure is limited to the price of a decent bottle of wine.

We can just as easily become conditioned to pay for our routine care out of pocket. I know this because over 90% of my clients pay for every day medical expenses out of pocket and use their insurance for the major items.

Reduce the Cost of Health Care

You make health CARE more affordable through lifestyle changes and encouraging personal responsibility for routine and minor health care.

So how do you reduce health insurance premiums?

Not by increasing taxes on health insurance plans or setting unreasonable expectations on things like how much a carrier must pay out in benefits. Health insurance is a fiercely competitive market and prices move without outside intervention to the lowest level.

Almost every free market industry has higher profit margins than health insurance. Attempts to regulate the market with micro-management only serves to drive away competition and raise premiums. Just look at states like Maine, Vermont, New York and Massachusetts to experience first hand the result of over-regulating a market. These states have some of the highest premium rates in the country and the fewest choices.

Government mandates, at both the state and federal level drive premiums up, not down. State mandates add 30% or more to health insurance premiums. Eliminating mandates, not increasing the number and scope of mandate will do more to make health insurance affordable than anything else.

If Congress truly has an interest in making health care, and health insurance more affordable they need to consider less regulation and manipulation, not more. They need to relax some rules, including those passed off as "consumer protection" that do nothing more than encourage over-utilization and raise premiums for everyone.

The election sent a message. We are not sure if anyone is really listening.

If not, we will be back . . .

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More Stupid ObamaCare© Tricks: HSAs vs "Young Adults"

This is to laugh:

Under ObamaCare©, your 26 year old "baby" is generally eligible to stay on your health plan (or re-up to it if the little darlin' had already "aged off"). And it means that the insurance benefit remains non-taxable to said "dependent." Which is fine, if you have a typical, generic "co-pay" plan.

But what if you were a savvy buyer, and own a High Deductible Health Plan (HDHP) and a Health Savings Account (HSA)? Well, the premiums for the HDHP are still non-taxable, but any HSA distributions may not be.

Here's the problem: ObamaCare© defined "dependent" in the context of the insurance policy, but the HSA isn't "insurance," it's money. So it continues to operate under the pre-existing rules regarding dependents, which is a completely different definition.

Result: disbursements for Junior who doesn’t meet the definition of “tax dependent” may be considered nonqualified, which means subject to some pretty hefty taxes and penalties.

How hefty, you ask?

Well consider that, next year, the penalty on nonqualified disbursements is increasing from 10% to 20%. Ouch!

Hmmm, maybe we shoulda read it before we passed it? Naaaah!

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On Tartys in Applis...

We're very proud of our work here at IB, and apparently other folks like it, as well. We get requests to reprint our work, which we almost always grant. That's fair, and it's also right: contrary to what some folks believe, being "on the web" doesn't mean "in the public domain." Unfortunately, that's not evident to the purported editor of Cooks Source Magazine (which offers both online and "dead tree" versions, both of which are supported by paid advertisers).

Back in '05, food writer and Medieval connoisseur Monica Gaudio reprinted her adaptations of 14th and 17th century apple pie recipes, in the original ("Ye Olde") English. One imagines Mr Chaucer enjoying a slice or three.

Fast forward 5 years, and these recipes, "edited" to "correct' the "awful writing" appear in the pages of Cooks Source Magazine. To her credit, the editor does name Monica as the source. To her discredit, she neither sought nor obtained Ms Gaudio's permission to reprint - let alone "correct" - the post. Ms Gaudio was notified of this situation by a friend, and promptly wrote to CSM's editor, a Ms Judith Griggs. After some back-and-forth, Ms Gaudio indicated that all she really wanted was a public acknowledgment and apology, and for CSM to make a modest donation to a journalism school.

What she received in reply is priceless (and by "priceless," we mean "epically asinine"):

"Yes Monica, I have been doing this for 3 decades, having been an editor at The Voice, Housitonic Home and Connecticut Woman Magazine. I do know about copyright laws ... But honestly Monica, the web is considered "public domain" and you should be happy we just didn't "lift" your whole article and put someone else's name on it!"

Really? Do go on...

"I am sorry, but you as a professional should know that the article we used written by you was in very bad need of editing, and is much better now than was originally ... you should compensate me!"

Gentlemen, I believe we have found a winner for the "New Definition of Chutzpah Award."

As one might imagine, this was not well-received, and the blogosphere is aflame today with recriminations. If you're interested - and you should be, if you ever post original content on, for example, a blog - this post provides an excellent starting point.

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Veteran's Day Health Wonk Review now online

Insurance Issues, Principles & Solutions

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Cavalcade of Risk #118: Call for Submissions

Jay Norris hosts next week's Cavalcade of Risk. Submissions are due this Monday (the 15th). Please remember to include:

¦ Your blog's url
¦ Your post's url
¦ The post's trackback URL (if available)
¦ A (brief) summary of the post

And PLEASE remember: ONLY posts that relate to risk (not personal finance tips and the like).

You can submit your post via Blog Carnival or email.

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Cool Tool: Pills That Get "Sick"

One of the problems with health care is that, as Bob pointed out this morning, a lot of us don't take out own responsibility all that seriously. That translates into other issues, of course, but one that we see with increasing frequency is folks who just stop taking their meds. They do this for a variety of reasons, of course, but one surely must be lack of immediate and notable feedback.

That's where Mathieu Lehanneur, a French artiste, comes in:

"Instead of redesigning you, why not redesign the pills? ... If the boy doesn't take his medicine on time, the inhaler will change color "displaying its own physiological problem and indicating to the patient the urgency of taking the medication."

That's right: if you don't take the pill, it gets "sick."

And he's designed an inhaler and other delivery systems, as well. I'm sure there'll be all kinds of hurdles to get these on the market (starting with an often recalcitrant FDA), but how cool would it be to want to take your medicine?

Maybe a syringe with a spoonful of sugar?

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Medicare Cuts Affect Seniors

Seniors on Medicare may find they are not welcome in the doctors office. Coming cuts in Medicare payments to physicians is not going to set well with doctors.

Funding Obamacare for the poor and uninsured is made possible by robbing Peter to pay Paul. In this case, Peter is seniors on Medicare. By paying your doctors less, Washington can use the money saved to pay for health care for younger people who don't have health insurance.

The folks at MediLexicon tell us what to expect unless Congress acts now.

Unless Congress intervenes, payments to doctors for treating Medicare patients will be cut by 23 percent on Dec. 1 and another 6.5 percent on Jan. 1.

Ouch! How many doctors are willing to treat patients for 30% less than they are paid now? Will your doctor be one of those who welcome Medicare patients with open arms or will they be booked up?

Cutting payments to doctors that treat seniors. Just another stupid government trick.

Next time you go to your doctor, ask if they are willing to take a major pay cut.

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