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Volume 8, Issue 11, November 2012
 


“Save Guard” from AEGON Religare Life Insurance Company
AEGON Religare has announced launch of an insurance plan with new dimension, which is not a pure protection term policy but a return of premium plan. Under Pure Term policies, the sum assured is given to the nominees in the event of the death of the insured. But this new plan from AEGON, named after “Save Guard”, provides life cover and also offers to pay back all the premiums paid during the plan period.

Save Guard provides two options to the policyholders. Under the first one, the sum assured is handed over to the nominees of the policyholder in the event of his/her death. The second one comes with an in-built accidental death cover equivalent to the sum assured. This amount will be paid out in addition to the sum assured if the policyholder dies in an accident. On maturity, all the premiums paid till then are 'returned' to the policyholder. The plan also has the option of critical illness rider.

The minimum annual premium under the policy amounts to Rs 2860, for a base cover of Rs 2 lakh. The minimum age of entry is 18 years, with the upper-age limit being 55 years. The maximum age at maturity is 65, 70 or 75 years for policy terms of 10, 15 and 20 years respectively.

It should be noted that this Plan is costlier than the simple term insurance plans.

Ten years completion of IPru’s Dynamic Plan
ICICI Prudential Life Insurance Company had launched its Dynamic Plan in 2002 and it has completed ten years. This plan provides long term investment solutions of the equity investors by capitalizing on volatility and facilitating wealth creation.

IPru’s Dynamic Plan is an open-ended diversified equity fund. The ICICI Prudential Dynamic Plan follows a three pronged strategy i.e. 1). The mandate to adopt an active cash strategy, which helps mitigate downside risks, when markets get overvalued. 2). Agility to capture upside opportunities across market caps. 3) The focus on investing across sectors based on valuation attractiveness and growth potential.

ICICI Prudential Dynamic Plan has the option of increased equity participation when the Sensex goes down and reduce equity participation when the Sensex goes up.

Private Insurer’s Premium falls in 2012-2013
The total premium collection of private life insurers decreased 5.7% to Rs. 116.22 billion in the April-September period of FY12-13 from Rs. 123.25 billion in the first six months of FY11-12.

The total premium collections of Life Insurance Corporation of India (LIC) declined 3.75% to Rs. 353.42 billion in the first half of FY12-13 from Rs. 367.21 billion for FY11-12.

Money Back Term Plan - Shriram Life Insurance Company
Shriram Life Insurance, a joint venture of the financial services major, Shriram Group and Sanlam of South Africa, has launched a new money-back term plan which offers a twin benefit. As any other term plan, Shriram’s money-back term plan offers lump sum payment in the event of the death of the insured. In case the person survives till the term of the plan, the entire premium paid during the policy term will be returned to the policyholder.

Shriram Life already has a money back term plan. This new plan is a modified version of the existing plan with few changes such as lowering the age of entry and reduction of surrender charges etc. The minimum age of entry is 12 years in the new plan as generally the term policies are not offered below 18 years by insurance companies. . The maximum age at maturity is 70 years.

This refined plan has four different rider options - accident benefit, critical illness, total and permanent disability and family income benefit riders.

First interim dividend by Max Life Insurance
Max Life Insurance on Monday announced its maiden interim dividend of 5.1% for its shareholders. The company would be distributing Rs. 115 crores based on the performance during FY 2012-2013.

The interim dividend of Rs. 99 crore, post Dividend Distribution Tax (DDT) of Rs 16 crore, will be distributed in proportion to shareholding as of November 1.

The company would enjoy solvency ratio of excess by 550% as against the stipulated 150%. The solvency surplus would amount to Rs. 1500 crores.

SBI Life is the “Most Trusted Private Life Insurance Brand, 2012”
SBI Life Insurance, the largest private life insurer has been adjudged as the “Most Trusted Private Life Insurance Brand, 2012”, for the second consecutive year. The survey has been carried out by the Economic Times Brand Equity - Nielsen Survey. The “Most Trusted Brands” survey evaluates brands on the basis of media visibility, consideration, specialty and customer confidence.

Reliance Life’s Net profit zooms by 63%
Reliance Life Insurance has posted its net profit at Rs.310 million for the quarter ended September 30, 2012. This is 63% up as against the net profit for the quarter ended June 2012 at Rs. 190 million.

Simple Benefit Plan from IndiaFirst Life
IndiaFirst Life Insurance Company is a joint venture between two of India’s public sector banks – Bank of Baroda (44%) and Andhra Bank (30%), and UK’s financial and investment company Legal & General(26%).

IndiaFirst has launched its new plan which is named after “Simple Benefit Plan” which offers dual benefits of a life cover and assured savings. Simple Benefit Plans is aimed at people who don’t have adequate disposable income but want to save for their future and also secure themselves from the uncertainties of life.

The plan term is between 10 to 20 years and offers a death benefit equal to the sum assured plus five times the annual premium, guaranteed amount and additional earning from bonuses.

It also provides tax benefits. Customers can also access their money easily during any emergency by availing a loan of up to 90 per cent of the surrender value.

Three successful years of IndiaFirst Life
IndiaFirst Life Insurance, a joint venture between two of India’s largest public sector banks - Bank of Baroda and Andhra Bank along with UK’s leading risk, wealth and investment company Legal & General was launched in 2009 and it has completed three successful years of operations..

Started with a share capital of Rs. 475 crores, IndiaFirst today has spread its branches over 1000 cities Pan India through 5000+ partner bank branches. The company has established a cutting edge by way of unique products that are simple and fairly priced and well serviced.

Speaking on the occasion, Dr. P. Nandagopal, Managing Director & CEO, IndiaFirst Life Insurance, said “We have come a long way and have successfully positioned ourselves as a customer-focused and innovative player in the life insurance sector in a short span of time. We have continuously strived to make our approach and our products customer oriented and that has helped us perform well on a sustainable basis”.

IndiaFirst was awarded the ISO 9001:2008 certification within 7 months of operations. The company’s USP lies in its innovating thinking and customer-centric approach. IndiaFirst has been awarded with Company of the Year Award – Life Insurance at The Indian Insurance Awards, 2012. It has also won the prestigious Celent Model Insurer Award (Asia), 2012 and the CIO 100 Award (India Edition), 2011.

Reliance targets significant premium from Tier II and Tier III cities
Private Insurer, Reliance Life explores substantial premium from tier II and tier III cities. He company targets significant growth in its business in the current financial year. It is looking forward to premium income of Rs. 61 billion in 2012-13. The company expects new business premium of Rs. 23 billion in FY12-13 from Rs. 18.09 billion in the last fiscal. The company estimates its renewal premium to grow to Rs. 38 billion for FY12-13 from Rs. 36.88 billion in 2011-12.

The company has reported net profit of Rs. 310 million for the September 2012 quarter. Its total funds under management increased 16% in the second quarter of current fiscal to Rs. 194.17 billion.

The total premium (net of reinsurance) for the September 2012 quarter was Rs. 10.03 billion. On quarterly basis, Reliance Life's net profit zoomed 63% from Rs. 190 million in the quarter ended June 30, 2012.

Life Assure – a twin plan from Bajaj Allianz Life Insurance
Bajaj Allianz has launched a new ULIP called “Life Assure” which offers both life cover and also income from savings. This ULIP is available at a monthly premium of Rs 1000. There are two variants under the Life Assure – Life Assure “Sure” and Life Assure “More”. The ULIP also has three riders viz. Accelerated Critical Illness, Super Premium Waiver and Extra Cover Benefit. Accelerated Critical Illness benefit gives the policyholder an immediate payment of Sum Assured in case of diagnosis of a critical illness. Super Premium Waiver benefit, when taken with Accelerated Critical Illness Benefit Rider would ensure continued creation of the corpus in case of death or critical illness. Thus, if both these riders are taken together, the plan offers a comprehensive protection for the policyholder and his/her spouse, in case of critical illness or untimely death. The third rider, Extra Benefit Rider gives an extra sum assured on unfortunate death during the policy term.

This plan is targeted at people who want to save and also to protect themselves from uncertainties of life. The plan is suitable to those who want to invest in market linked financial instrument but due not have surplus money or investment modalities.

New Distribution Channels by Reliance Life Insurance
Reliance Life Insurance has announced the launch of two new distribution channels namely “face-to-face” and Life Plaza distribution channels to reach the policyholders whose agents have turned inactive. These platforms also provide post-sales service to its policyholders.

According to Mr. Malay Ghosh, President and Executive Director, Reliance Life Insurance, "The main goal of this distribution format is to target existing customers who are currently not connected to any advisor and distributor. We hope this sales-cum-service initiative will not only help retain our existing customers but also help us enhance relationship value through cross-sell and up-sell to them..

The operations under the Face-to-Face distribution channel will be carried out by the Life Planning Officers who are women employees. They would be trained to service the policies of such policyholders whose agents have turned inactive (orphan policyholders) thereby developing rapport and then cross-sell the other products of the company.

During its pilot phase, the company has recruited 200 women employee advisors from seven cities. These newly recruited advisors have taken up their training and started servicing the orphan policies.

Face-to-face distribution channel will focus on Tier I and Tier II cities.

The Face-to-Face distribution model is adapted from Nippon Life Insurance, Japan. This model is expected to enhance the reach of the company into the tier II and III cities. Life Plaza will help us further reach out to customers, understand their needs and provide solutions to them at the venue. The process of selling will ensure that the customer buys only what he/she needs and understands and thus also address the problem of mis-selling.

RLIC is hiring about 1,000 people and setting up 200 Life Plazas across the country with a focus on Tier II, Tier III and Tier IV cities by the end of this fiscal.

Investment cap relaxed - LIC to invest up to 30% in companies
Life Insurance Corporation of India (LIC) can now invest up to 30% in a company as against its earlier limit of 10%, according to the directives of the Finance Ministry. Since LIC has a huge reserve of cash, it has been requesting the Finance Ministry for investing more in companies. Accordingly a notification relaxing the investment cap has been issued.

IRDA to form product-specific committees
With a view to assist the Life Insurance Council in speedily resolving issues faced by the Life Insurance companies, the Insurance Regulatory and Development Authority (IRDA) will form product-specific committees.

These newly-set up committees will handle the ULIPs, variable insurance and traditional plans and interact with IRDA and with the Insurance Council.

Each committee would include six members, including CEOs, actuaries and product heads of various life insurers, the reports concluded.

Dhan Samruddhi for the Risk Averse - Aviva
Aviva Life Insurance has recently announced the launch of Aviva Dhan Samruddhi, a traditional money-back policy that offers guaranteed returns.

Dhan Samruddhi offers a guaranteed addition of 7-9% of the annual premium till the end of policy tenor which can be either 10, 15 or 20 years. The premium payment term is fixed at 10 years irrespective of the policy tenure.

The minimum entry age is 13 years, with the upper limit being 55 years. The policyholder's age at maturity cannot exceed 70 years. The minimum annual premium and sum assured under the plan are Rs 6,464 and Rs 1 lakh respectively.

Traditional Plan with guaranteed Returns – SBI Life
SBI Life, the largest private insurer has recently announced the launch of a traditional plan that offers guaranteed returns named as “Smart Income Protect”. The policy has a limited premium payment term after which the payout period would start.
Smart Income Protect is a participating policy that entails bonus to the policyholders.
The premium payment term has an option of five, ten or 15 years.

In the event of the death of the policyholder, before the end of the policy term, the nominee will get the sum assured plus accumulated bonus, if any. Smart Income Protect is in built with three optional riders, viz. accidental death benefit, accidental total and permanent disability and critical illness.

Guaranteed Endowment Plan from Tata AIA Life
Tata AIA Life has launched a guaranteed endowment plan “MahaLife Supreme”. This is a non-participating (non-par) and non-participating policy that offers guaranteed maturity benefits. The policyholder pays premiums for a limited period of 12-15 years depending on the option that he chooses. However, the policy tenure extends for 30-35 years.

After the premium payment period comes to an end, the policyholder receives annual 'income' till the expiry of the policy tenure. At maturity, a lump-sum is paid out at maturity. This lump-sum is paid as per the prescribed formula. In the event of the death of the policyholder during the policy term, the nominee will get the death benefit.

Life Insurance Premium collection fall sharp – Tata AIA, Reliance Life
According to the information from the Parliament, there was a steep for in the life insurance premium collection for the six month period ending September 2012 for Tata AIA and Reliance Life Insurance.

The total premium collected by Tata AIA Life Insurance during April-September 2012 declined by 29.55 per cent followed by Reliance Life Insurance at 28.62 per cent. The steep fall in the life insurance premium collection is attributed to various factors that influence the financial sector as a whole. However the public sector player Life Insurance Corporation (LIC) recorded much better performance as against its private peer players and has recorded only a marginal decline of 0.18% in premium collection during the said period. SBI Life (23.97 per cent), Birla Sun Life (15.56 per cent), Shriram Life (14.6 per cent), Sahara Life (12.94 per cent) and Future Generali Life Insurance (12.60 per cent) were the other private players who have recorded fall in premium collection.

The figures provided by the Minister revealed that premium collected by the private sector life insurance companies during the first half of the current fiscal declined to Rs 32,423 crore from Rs 35,059 crore in the corresponding period a year ago.

LIC collected a premium of Rs 87,780 crore, down marginally from Rs 87,937 crore in the six-month period of the previous fiscal, the minister said quoting figures.

New Health products from Reliance Life
Reliance Life has plans to launch four new products in health and annuity segments.

Consequent to the overall slump in the market, Reliance plans to aggressively focus its healthcare policies and manage tide over the market sluggishness. The various reasons such as inflation, high deposit rates and change in prudential norms have significantly contributed to the sluggish growth of the life insurance segment. Hence, Reliance Life, with an objective to adapt to the changing economy, now plans to focus on healthcare products.

Life insurers' new business drops 3.45%
Life insurance companies posted a 3.45% in the first six months of the current fiscal to Rs 53,814 crore mainly due to drop in group non-single income.

According to the Insurance Regulatory Development Authority the industry collected Rs 55,737 crore during April-September 2011. Life Insurance Corporation saw 2.88% drop to Rs 40,069 crore in the first half from Rs 41,295 crore for the corresponding period last year. Private sector companies saw a huge decline of 5.07% during the period.

The group non-single premium collections dropped 66.81% to Rs 2,883 crore from Rs 8,688 in the first half of the financial year. Apart from the group single premium, the industry saw 7.9% drop in individual single premium collections.

New product guidelines are expected to boost growth of life insurance guidelines.

 

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