IRDA Halts LIC to invest 30% in Equity Market
Insurance experts say that IRDA (Insurance Regulatory and Development Authority) may take time to allow LIC to invest 30% in the Equity Market as there is complete oversight on LIC relating to its activities in the equity segment with respect to its market conduct and prudential regulations. However, IRDA Chairman TS Vijayan is of the view that the regulatory oversight of LIC is quite comprehensive to the extent that it requires monitoring both prudential and market conduct operations of LIC. The insurance regulator had recently increased the equity investment cap for insurers from 10% to 12% and 15%, depending on the size of the controlled fund and LIC is allowed to invest 15%.

Shriram Life Records Rs. 960 Millions as its First Quarter New Business Premium
In its reports for the first quarter ended June 30, 2013, Shriram Life Insurance Company has recorded Rs. 96 crores as its new premium for 2013-14 as against the first premium of Rs. 87 crores collected for the first quarter in 2012-13. This reflects 10% growth over the previous corresponding period at a time when the industry as a whole has a drop in growth by 1%.

Ms. Akhila Srinivasa, MD of Shriram Life Insurance expressed her happiness over the commendable growth told the media that ““We are pleased to report that Shriram Life Insurance is now ranked 9th in the private industry on Policy Count. We sold 34,000 policies (a 36% growth QoQ). The strong growth in policy count is testimony to company’s focus on penetrating into lower and lower middle segment. The industry saw a drop of 10% for the same period”.

Quicker Relief for Uttarkhand Victims
Subsequent to the Directives issued by the Government to the Life Insurance Corporation of India (LIC) to process the claims of those missing in the recent Uttarkhand calamity on a fast track phase by accepting a certificate issued by the government.

Similar Directives have been given to all other private Life Insurers too towards expeditious settlement of claims to the Uttarkhand victims.

LIC has set up special help desks in their divisional and branch offices to assist the affected persons. Public Sector General Insurance Companies (PSGIC) have also set up “Apda Rahat” Camps to facilitate the lodging of claims of affected persons & property. The claim format has been simplified for the Uttarkhand victims and a Certificate issued by any Government Department, is being accepted as proof of death. The norms for settlement of property claims also have been simplified by PSGIC.

Regulation of commission rate to insurance agents
Regulation (9) of Insurance Regulatory and Development Authority prescribes levels of commission payable to the insurance agents for the linked insurance products while Regulation (21) under the same prescribes commission payable to the Non-linked insurance products.

As informed by the IRDA, the position regarding first year premium of the life insurance business in 2012-13 was 6.48% down at Rs. 1.07 trillion, while in 2011-12 it was 9.85% down at Rs. 1.14 trillion and in 2010-11, it was 15% up at Rs. 1.26 trillion.

Insurers should follow TRAI norms for telemarketing: IRDA
The Insurance Regulatory and Development Authority (IRDA) has informed all the life and general insurance companies to follow the regulations of the Telecom Regulatory Authority of India (TRAI) while carrying out their telemarketing activities.

According to the Telecom Commercial Communications Customer Preference Regulations 2010, those sending commercial communications should be registered with TRAI as a telemarketer. However, the circular issued by IRDA revealed that some of the insurance companies and their marketing intermediaries are violating the relemarketing norms prescribed under the TRAI’s regulations.

The registered telemarketers are also supposed to use telephone numbers from the ‘140’ series. They should also filter the numbers that they accessing through the National Customer Preference Register database before making voice calls and SMSes.

IRDA to introduce norms for CSC-insurers' tie-up
The Insurance Regulatory and Development Authority (IRDA) plans to issue guidelines for insurance companies to tie-up with the Common Service Centres (CSCs) across India which would help the insurers to sell their products. The new model of CSCs is expected to come into operation within the next couple of months.

Plan Retirement- Niraj Shah, SVP & Head Products, ICICI Pru
Following the dramatic change in the Indian economy, there has been increase in the disposable income with the Indian population and the increased domestic demand etc., This has led to improved lifestyle and consequently improved life span. The life span of a retired individual has increased by 20 years according to a research and thus there arises a need for the individuals to have sufficient funds to maintain their life style after retirement.

If a 7% inflation is assumed, today’s monthly expenses of Rs. 25000 would mean Rs. 1,36,000 per month after 25 months plus medical expenses which is soaring at a fast pace.

Most of the private sector organizations do not provide pension. Moreover, the increasing cost of health care and medical treatment drive people to plan for retirement so that they get a regular flow of money after retirement that will enable them to manage the increased expenses without compromising their lifestyle.

The question arises as to when to start planning for retirement. Earlier is always better in case of retirement planning. Starting early gives you the benefit of time, which coupled with the power of compounding, enables you to create a sizeable corpus that can enable an individual to take care of expenses after retirement.

Retirement planning can be done in 3 simple steps:

Step 1: How do I calculate my expenses post retirement?
Take into account your current expenses and factor in aspects like inflation, increased medical costs, vacations, gifts for family etc. You will then arrive at an amount that you will require for living comfortably once you have retired. You need to keep in mind that inflation will cause your expenses to increase (even if you are spending on the same items). One can eliminate costs like children's education and rent, if you own a home.

Step 2: What will be the savings pool I need to build?
Once you have an idea of your expenses, you can accordingly establish the quantum of amount (corpus) required to be built – the amount that you need for meeting the expenses. This savings pool will be created taking into consideration the inflation factor.

Step 3: How much do I need to save now?
Depending on your financial status, determine the funds which can be put aside for building the desired retirement corpus. Start saving now so that you have time on your side and can enjoy the power of compounding.

SBI Life records Rs. 2.12 billion as Q1 net profit
SBI Life net profit stood at Rs. 2.12 billion for the quarter ended June 30, 2013 as against Rs. 1.63 billion for the same quarter last year.

During the period under review, the insurer's income from investments rose to Rs. 2.1 billion from Rs. 1.65 billion.

Central Insurance Repository gets IRDA Repository License
Central Insurance Repository (CIRL) has received the license from IRDA (Insurance Regulatory and Development Authority) Repository License on 31 July 2013.

CIRL is an insurance repository set up under the guidelines on insurance repositories and electronic issuance of insurance policies. It is promoted by CDSL, CVL along with various Life Insurance & Non-Life Insurance Companies with an objective to provide policyholders a facility to keep insurance policies in electronic form.

Policy holder can request their insurance companies who provide e-insurance facility through CIRL to credit old & new policies into their e-insurance account. An e-insurance account holder can appoint Authorised Representative who shall help the policyholder's nominee get the benefits after his demise.

Pension Products redefined by Max Life
Max Life Insurance, one of the leading private life insurers in India has announced the launch of their new and unique pension plans viz. Max Life Forever Young Pension plan’ and ‘Max Life Guaranteed Life Time Income Plan’. These plans guarantee a carefree and financially secured retirement for the individuals.

While the ‘Max Life Forever Young Pension Plan’ is a unit-linked plan with a minimum guaranteed return of premiums that helps in accumulating a retirement corpus , the ‘Max Life Guaranteed Life Time Income Plan’ is an annuity plan that helps utilize the retirement corpus to guarantee an income for life. Together this retirement solution provides guaranteed lifetime income for an individual and his/her spouse.

The unique feature of this pension plan has two rider benefits - Max Life Partner Care Rider, safeguards the completion of the plan for the spouse in case of an untimely death of an individual during the accumulation phase. The‘ Save More Tomorrow’ option will enable the individual to increase her/his savings component in a disciplined manner every year to mitigate the effects of inflation on the pension.

Banks to act as Insurance Brokers
To qualify for the licence, each bank will have to have the principal officer As per the recent guidelines from IRDA, banks can act as brokers and sell insurance products of more than one insurer as against the earlier status of selling only the products of one insurance company. This is for the purpose of exploring the insurable potential across the country.

According to Irda (Licencing of Banks as Insurance Brokers) Regulations, 2013, there is no capital requirement for insurance broking business carried out by banks. However, each bank must have a principal officer to qualify for the license.

'Principal Officer' means — a general manager or equivalent cadre of the respective licensed entity appointed exclusively to carry out the functions of an insurance broker and positioned at corporate office, the IRDA said in the notification on 8th August.

The licence, will be valid for three years from the date of issue For renewal of licence, the same can be applied 30 days before expiry of licence.

Life Insurance Industry Spearheads ‘Customer Centricity’
Life Insurance industry, riding on the growth path that has been spurred by product innovation and multiple distribution channels, is now making a concerted effort towards being Customer Centricity in its approach by adopting Internationally accepted six principles viz. Increasing overall confidence, Meeting customers’ Needs, Clear Information, Suitable Advise, Product Performance & Post Sales Barriers.

The Regulatory changes in recent years have brought renewed focus on Customer Centricity - be it, protection-oriented like making sum assured at a minimum ten multiples, and offering guaranteed surrender value, or transparency-oriented like forming a policy-holder protection committee or making benefit illustration mandatory for all products, or even investment-oriented relaxing investment guidelines for exposure to infrastructure, or need-oriented like measuring product suitability matrix before making any recommendation.

V. Manickam, Secretary General, Life Insurance Council, the industry body of life insurers in India, said: “The Life Insurance industry would reinforce customer centricity at every step, be it creating awareness by improving financial literacy, need-based service & addressing effectively customer grievances etc. As a matter of fact, there has been an improvement in death claims settled by Life Insurers in terms of number of policies as also by amount in the past three most challenging years. The number of claims repudiated too has seen a significant drop. ”

Customer Grievance Redressal through Integrated Grievance Management System (IGMS) has been successful with no of grievances attended rising, and the number of pending grievances steadily declining to below 1%.

DLF Pramerica Life Insurance launches ‘Aajeevan Samriddhi’
DLF Pramerica Life Insurance Co. Ltd. (DPLI) has launched ‘Aajeevan Samriddhi’,. This plan is a participating whole life insurance cum savings plan that helps customers protect the financial security of their families through their life time. The plan provides life cover till the age of 99 years with premium required to be paid only for a limited tenure.

Aajeevan Samriddhi also doubles up as a smart savings tool to help customers plan for the golden years of their retirement. The survival benefit payout of compounded reversionary bonus and Guaranteed Additions at age 65 ensures that customers have a corpus to help take care of post retirement expenses, and maintain their existing lifestyle.

No extra charges for ECS payment: IRDA
ECS is an electronic mode of payment / receipt for transactions that are periodic in nature. Electronic Clearing Service (ECS) mode enables collection of premiums without any manual intervention of policyholders.

The Insurance Regulatory and Development Authority (IRDA) announced that that the life insurance companies shall not levy any additional charge towards cancellation of the electronic clearing service (ECS) mode / recover such additional charge from the benefits payable under the policy.

Bharti AXA Life launches ‘Secure Income Plan’
Bharti AXA Life Insurance, the private life insurance company , announced the launch of a unique traditional non-participating plan, Bharti AXA Life Secure Income Plan with a limited payment term. This plan provides tax free guaranteed income at the end of the term. On maturity, the policyholders gets the sum assured along with the guaranteed additions.

In the unfortunate event of death of the life insured, the beneficiaries get the highest of sum assured plus guaranteed additions accrued till date of death or 105% of premiums paid or 13 times annual base premium (for a policy term of 20 years)

Single premium plan from Canara HSBC OBC Life Insurance
Canara HSBC Oriental Bank of Commerce Life Insurance announced the launch of its first single premium plan - Canara HSBC Oriental Bank of Commerce Life Insurance Shubh Labh which is a Unit Linked Non-participating endowment life insurance plan. This plan provides life over and helps customers meet their protection and investment needs.

IRDA issues norms for agents training institutes
Institutes which are engaged in training for financial products for more than three years are eligible to apply for starting an offline/online institute.

In order to ensure that only serious players come into such business, IRDA (Insurance Regulatory and Development Authority) has issued standard guidelines applicable for approval/renewal of agents training institutions (ATIs).

These guidelines are applicable to all the training institutes including in-house training institutes of the insurers.

The accreditation window for starting new ATI will be opened twice in a year depending on need.

Institutes which are engaged in training for financial/insurance products for more than three years are eligible to apply for starting an offline/online institute. However this will not apply to in-house institutes of insurers, the IRDA said in a circular on 1 August 2013.

Only entities registered as Company under the Companies Act and Society and trusts registered under Societies Registration Act shall be eligible to apply for accreditation as Atls, it added.

The accreditation will be given on need basis. The existing private ATls wilt be granted a one-time permission as assessed by the Department to relocate the centers within the state. The existing ATls will also be eligible for reallocation of the centres within the state based on the assessments made by the Department.

For a new location if more than one private Agents Training Institutes apply for accreditation, internal grading and marking system will be applied to give accreditation on merits.

The initial approval will be for a period of three years and consideration of further renewal next three years would depend on the satisfactory compliance of requirements of accreditation. Accreditation of any centre which has not conducted any pre recruitment training for one year continuously will be liable for cancellation.

For renewal cases the ATI are required to apply with all documents/details three months in advance of expiry of accreditation.

To read the full guidelines, please click on the following link given hereunder.
http://www.taxmann.com/topstories/104010000000040562/irda-puts-in-fetters-to-ensure-only-serious-institutions-are-recognized-to-impart-training-to-insurance-agents.aspx

ICICI Prudential Life launches ICICI Pru cash advantage
ICICI Prudential Life Insurance Company Ltd (ICICI Prudential Life) has launched a new traditional plan called ICICI Pru Cash Advantage. This plan enables customers to systematically plan for their long term financial goals while ensuring a regular cash flow for meeting regular expenses.

This new traditional plan has been designed with specific reference to meeting the long-term financial goals of customers and also their regular expenses. While the maturity benefit takes care of the larger goals of life, the cash benefit advantage is meant for meeting their regular expenses. The plan also has a unique feature which allows the customers to choose the premium paying period viz. 5,7 or 10 years that would suit their financial capacity.

Reliance Life to sell up to 5% to bancassurance partner
IRDA recently has allowed banks to act as brokers and sell products of more than one insurer in order to increase the penetration of insurance in the country.

Following the IRDA’s nod for banks to act as insurance brokers selling multiple insurance company products, Reliance Life is looking for tying up with several banks and offer a stake of up to 5% for the same. So far, Reliance Life does not have a bancassurance tie-up or a distribution pact with a bank.

"Allowing banks to act as brokers and sell products of more than one insurer has opened up a distribution opportunity for the company. We are in talk with multiple banks, including commercial and co-operative, for a long-term strategic partnership and might offer a small equity stake up to five per cent to a bank of critical size and reach," Reliance Life Insurance CEO Anup Rau told PTI. According to industry experts, the banking distribution channel account for almost 60 per cent of the business at leading private sector life insurance companies.

IRDA slaps fine of Rs 3.10 crore on Bajaj Allianz Life
Insurance regulator IRDA has levied a hefty penalty of Rs 3.10 crore on Bajaj Allianz Life Insurance for violation of various norms, including those related to early-death claims and group insurance. The penalty has to be remitted within 15 days.

A penalty of Rs. 78 lakhs was levied for rejection of early death claims as unconcluded contracts under the pretext that the insured persons dies after the date of commencement of risk but before receiving the policy document. Bajaj Allianze has rejected 78 claims under the this ground during 2010-11 which was a violation of File and Use Guidelines.

Moreover the insurer has been directed to ensure fair settlement of claims both as per terms and conditions of the policy contract and as per regulations.

Bajaj Allianz also violated norms by entering into referral arrangements with entities that were not licensed to act as corporate agents or insurance intermediaries for the sale of group insurance products, the regulator said.

"By entering into referral agreements and making payments to group policy holders, the insurer has grossly violated Clause B-2 of Group Guidelines," IRDA said.

Therefore, it said, under powers of the Act, a penalty of Rs 70 lakh is levied on the life insurer

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