LIC to stop selling 14 life insurance policies
Life Insurance Corporation has decided to stop selling as many as 14 policies, including Jeevan Mitra and Anmol Jeevan. Out of these 14 products, LIC has already withdrawn seven policies, including Convertible Term Assurance, Children Deferred Endowment Assurance, with effect from November 16.

Five more policies including Jeevan Mitra, Jeevan Paramukh Plan, LIC's Bima Account I and II will also go off from LIC's shelves from November 23.

Guaranteed Growth Plan from Aegon Religare Life
AEGON Religare Life Insurance has launched a new product 'AEGON Religare Guaranteed Growth Insurance plan. This is a medium term plan targeted at the risk-averse customers looking at a steady return over the medium-term. 

The premium paying term for the new plan is 8 years and policy term is 10 years. At the end of the policy payment term, the customer gets an annual return equivalent to 150 per cent of the premium, paid for a period of 8 years. 

While the minimum age to enter the policy is eight years, the maximum is 50 years.

Revival of Lapsed Policies at Reliance life insurance
Reliance Life Insurance Company has brought out a new initiative for revival of the lapsed policie.

While in practice, a lapsed policy can only be revived by payment of due premiums along with applicable interest and Declaration of Good Health by the policyholder, RIL’s new initiative permits the policyholders to renew their lapsed policies by simply paying their premium arrears without any penalty or medical tests.

Reliance Life Insurance is offering this revival opportunity across all its insurance products till November 30, 2013. The benefit will be available across all Reliance Life Insurance plans and extended to every policyholder across the country.

Re-launch of 10 policies by SBI Life
On approval of 10 products by IRDA, SBI Life Insurance plans to relaunch about 10 products by January 1, 2014.

The Insurance Regulatory and Development Authority (IRDA) had extended the deadline for implementation of new individual product regulations for the life insurance industry  by three months to December 31 to enable insurers to cope with the system readiness.  The new guidelines are aimed at making insurance policies more customer-friendly. 

"All the existing group policies and all the existing individual products not in conformity with the provisions of this regulation shall be withdrawn from August 1, 2013 and January 1, 2014, respectively," IRDA had said in a circular. 

With regard to group policies, the life insurers have been asked not to enroll these policies after the immediate policy anniversary falling due after July 2013. 

However, it had said, all group policies at the time of renewal of such policy shall be given an option to switch over to the modified version of the group product, if any, once introduced.

Online term policies are cheaper
Online insurance policies are emerging fast as a preferred medium due to lower premiums and ease of processes of buying the same through internet. These online policies are aimed at young, urban population who are tech savvy. The target audience for the online policies consist of people of age group between 30 years and 44 years who generally opt for term policies.

The key differentiator of online term policies is the pricing as all other features are identical between online policies and offline policies. The unique feature of the online term policies is that they are 30-40% cheaper as compared to buying them physically. Moreover, the Insurer is also at an advantage because there are no distribution costs and the transaction costs are lower. These advantages are passed on to the customers by way of lower premiums.

Complaints against life insurers rise 9.2% in FY13
According to an IRDA (Insurance Regulatory and Development Authority) report, the complaints from life insurance policyholders have grown by 9.2% to 3.4 lakh in 2012-13 as against 3.09 lakhs of complaints in 2011-12.

Almost 50% of the complaints pertain to unfair business practices followed by the life insurers. Other complaints include malpractices, misappropriation of premiums, single premium policy issued as annual premium policy, difference in promised and actual features in products, non-refund of premium on policies cancelled during the free-look period, tampering or forgery of proposal forms and alteration in policy tenure without consent.

According to T. S. Vijayan, Chairman, IRDA, the reason for the grievances in insurance business is because lack of information flow symmetric across people. Customers may not know the entire thing that is being given to them. To address these issues, we are working towards improving insurance awareness,

On the other hand, general insurance complaints declined 15 per cent to 78,927 in FY13, from 93,155 in 2011-12.

The reason for this, according to Mr. Vijayan is that General insurance contracts are short-term contracts, which are settled annually. Life insurance contracts are long-term contracts and the gap between the understanding of the seller and the buyer is more in life insurance.

LIC to surpass first premium collection for FY 2014
Life Insurance Corporation of India (LIC) is confident of exceeding the target for first premium collection for this fiscal year due to brighter time for the industry than the previous year which was very sluggish.

Life Insurance Corporation (LIC) had witnessed a 6.5 per cent drop in new premium collection in the last fiscal. The first premium growth for the year is more than 30 per cent as of now against budgeted 12 per cent.

LIC outshines private Insurers in HI Premium collection
The State-owned Life Insurance Corporation has outperformed its peers in the private sector by recording a 7.26 per cent growth in premium collection during the first half of the current fiscal.

Several large private sector insurance companies, including ICICI Prudential, HDFC Standard Life and SBI Life, witnessed a decline in premium collection during the April- September period compared to the same period last year.

The data released by the Insurance Regulatory and Development Authority (IRDA) said the performance of a host of small private sector insurance companies, including Sahara Life, Edelweiss Tokio and Future Generali, has been muted. LIC witnessed a 7.26 per cent growth in premium income to Rs. 37,906 crore during the six-month period ending September. However, the 23 private sector players' premium income grew 4.55 per cent to Rs. 12,150 crore during the period.

Among the large private sector insurers, Reliance Life has performed better showing, with premium collection rising to Rs. 1,022 crore from 570 crore in the same period last year, mainly on account of increase in group premium. Life insurance companies collect premium under four segments -- individual single, individual non-single, group single and group non-single.

Source: Economic Times

RBI Sets norms for Banks to Enter into Insurance Broking
The Reserve Bank of India (RBI) has released draft guidelines for entry of banks into insurance broking business. “Since insurance broking is a knowledge-intensive activity requiring professional expertise, this will be permitted subject to the certain conditions,” the RBI said.

Banks desirous of offering insurance broking services, however, have to get specific prior approval of RBI. ``Validity period for the approval granted for insurance broking will be three years subject to review thereafter,’’ the RBI said.

According to the draft guidelines, released on Friday, banks should formulate a comprehensive board-approved policy on insurance broking. And, the services offered to customers should be in accordance with this policy. The draft guidelines have laid out certain eligibility criteria for banks. Aspiring banks should have a net worth of not less than Rs.500 crore, and CRAR (capital to risk assets ratio) of not less than 10 per cent. Further, the draft has stipulated that the level of net non-performing assets should not be more than 3 per cent. Also, the bank should have made profits for the last three consecutive years. The RBI has made it clear that the track record of the subsidiaries/JVs, if any, of the bank should be satisfactory. “To avoid any conflict of interest, banks undertaking insurance broking business should not enter into agreements either for corporate agency or for referral arrangements for insurance, either departmentally or through subsidiaries/group companies,’’ it further stated.

Source: The Hindu

HIV Patients to be covered under Life Insurance
IRDA (Insurance Regulatory and Development Authority) has been directed by The Union Health and Family Welfare Ministry to remove, from its draft circular, provisions that exclude people living with HIV (PLHIV) from purchasing health insurance products.

The IRDA circular, issued about a month ago, asks all insurers to provide life-insurance cover to HIV/AIDS patients. “It is not an either-or-situation for HIV/AIDS patients. They should be able to buy both life and health insurance if their CD4 count [a measure of sickness] is above a particular cut-off. HIV/AIDS should be treated [as] any other chronic diseases like cancer or diabetes,” DAC additional secretary Aradhana Johri told reporters here on Tuesday.

Even as she expressed appreciation for the IRDA’s efforts in bringing PLHIV under the ambit of insurance cover, Ms. Johri said the efforts fell short of expectation and needs. There were, she said, approximately 21 lakh people living with HIV in the country who are denied health and life insurance for other diseases if they test HIV-positive.

The insurance products of both group and individual type should also be available for widows and children and they should be able to purchase it without getting excluded. Since widows and children are more vulnerable, special efforts should be made so that they are not excluded, the DAC has written to the IRDA.

According to Ms. Johri, the DAC had set up a technical working group to work out the means of including PLHIV under insurance products. The technical working group had recommended that there should be at least one health insurance product offered by each insurance company where HIV/AIDS is removed from the exclusions. PLHIV shall not be excluded from the group health insurance plans, which are generally offered by insurance companies to employers and must be included in the government-funded mass health insurance schemes targeted at the poor and other vulnerable sections of society.

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