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IndiaFirst premium grew by over 43 pc to Rs 1,000 cr in FY12

admin — Thu, 05 Apr 2012 06:35:59 +0000

Private insurer IndiaFirst Life Insurance today said it garnered premium at Rs 1,000 crore during FY12 by over 43 percent compared to the previous fiscal.

IndiaFirst premium stood at Rs 700 crore in FY11, the company said in a statement issued here.

“Being incorporated in November, 2009, we have approximately covered 1.6 million lives. The trust displayed by our customers, distributors and shareholders in us, adds to our responsibility of ensuring continuous innovation to keep providing enhanced value,” IndiaFirst Managing Director and CEO P Nandagopal said.

Last financial year, IndiaFirst surpassed its rural and social obligations laid down by the regulator, he said.

The company acquired 14 per cent of its business from rural India and covered 5,27,589 lives against 5,000 lives – taking the benefits of life insurance to the doorsteps of customers across the country, irrespective of their location.

This year the company has further increased its presence in the rural hinterland of India by tying up with 10 Regional Rural Banks, the statement said.

The total Assets Under Management (AUM) of the insurer at the end of March has crossed Rs 2,500 crore, it added.

IndiaFirst Life Insurance is a joint venture between two public sector banks - Bank of Baroda and Andhra Bank, along withUK’s leading risk, wealth and investment company Legal & General.

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Buy a cover for your child

admin — Mon, 26 Mar 2012 10:11:43 +0000

Children are undoubtedly the top priority for parents. Every parent, irrespective of his or her financial status, would want only the best for the children and good health is no exception. Any medical problem with the child is a double whammy because the parents have to suffer emotional as well as financial trauma. Unforeseen and alarmingly high health expenses can even cause a serious dent in the parents’ pockets.

It is commonly observed that in case of family medical covers, parents often ignore health cover for their children or restrict the same to a relatively smaller sum. Typically, parents provide for a cover up to Rs 50,000 for their children and the coverage increases gradually with the age of the children. However, this may not be the best thing to do.

At a younger age, the child is more susceptible to illnesses and preventive services like immunisation and medical care for recurring illnesses such as asthma, ear or throat infections.

Need for adequate medical cover: In developed countries, it is observed that children who have health insurance coverage generally, have better health throughout their childhood and into their teens. They are less likely to get sick and more likely to get preventive care to keep them well. At the same time, they get the required treatment they need when they are sick or injured, without the parents having to bother much about the financials.

An important reason children should have adequate healthcare is that the injuries or diseases a child suffers early in life can affect his growth and development. No doubt, parents can and would pay for their child’s health expenses, but at times, costs can be prohibitive.

How is it different from any other medical policy? Life insurance companies offer a variety of plans specifically designed to protect the needs of children especially in the absence of parents on the traditional and non-traditional platform. There are other plans which also offer investment at various stages of a child’s growth like higher education, marriage and so on.

Unlike life insurance, there are no dedicated medical plans available for children but can only be covered under the same plan as their parents. The only means by which health coverage can be provided is by way of a family floater policy or individual cover for the child combined with one of the parents. Most family policies have a cap on the number of kids that can be included in the cover.

Some of the available medical policies cover children only from the age of five. However, a younger child may be allowed to be covered from the 91st day, if both the parents are covered under the same policy (varies across companies).

Hence, children’s medical policies are similar to adults’. The cover would provide reimbursements for nursing and related expenses during hospitalisation and also cover the pre and post hospitalisation costs as prescribed under the policy guidelines.

Strategy for child cover: It is advisable to take individual covers in the name of children (minimum of Rs 3 lakh per child) along with the parents in the same policy. To illustrate, the following example for a family of four will be helpful in deriving a good strategy for optimum child medical coverage.

It is assumed that the eldest member in the family is below 35 year of age. In both situations, it is extremely important that both the parents have medical coverage of Rs 5 lakh each. Since the children cannot be covered under an independent policy, a family floater plan including the father and the 2 kids is considered for a floater cover of Rs 3 lakh.

In the second proposition, a family floater policy is considered where both the parents are covered up toRs 5 lakh each and both the kids are covered up to Rs 3 lakh each.

It may be observed from the table, that a family policy not only helps in securing separate covers but is also friendly to the pocket. If finances are not a constraint, then it is advisable to have separate covers for the children and parents. A floater policy can always be added as an additional safeguard. At this juncture, it is advisable to keep in mind that medical premiums paid for self, spouse and dependent children are deductible from the taxable income to an extent of Rs 15,000 under section 80D of the Income Tax Act.

HEALTH EXPENSE SHEET
	Type of cover	Sum assured	Situation 1 Premium outgo (Rs)	Situation 2 Premium outgo (Rs)
Parents	Individual cover	Rs 5 lakh	11,813	-
Eldest parent, 2 kids	Family floater	Rs 3 lakh	5,739	-
Parents, 2 kids	One cover for parents and one for kids	Parents = Rs 5 lakh; Kids = Rs 3 lakh	-
Total			17,552	16,886
(For the purpose of these illustrations, the quotes used are those for the respective plans of Apollo Munich Health Insurance, the same should not be construed as any recommendation).

For salaried individuals, covered under group medical policies provided by their companies, also helps in enhancing the cover for kids. But these policies should strictly be supplementary to independent medical coverage.

Learnings from trends abroad: Child only plans available in the United States are individual health insurance policies made available to children under age 18 with no parent or guardian listed on the same policy. The 2010 Patient Protection and Affordable Care Act prevents insurers from declining health insurance applications for children due to pre-existing medical conditions.

However, recently a lot of health companies have discontinued offering such plans on concerns that parents could delay purchasing cover for children until they got sick. Some countries even offer ‘baby health insurance’ which provides coverage right from birth till approximate 30 days post delivery.

To sum up, it is important that children are actively and adequately included in the medical policies of parents, who are concerned about coverage for their child and want to ensure coverage even during change in jobs or in times of uncertainty.

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How to understand various terms used in Life Insurance

admin — Sat, 24 Mar 2012 10:28:52 +0000

Most of us want to have a life insurance plan. We almost buy these plans when they are either pushed to us by agents or we think of buying them when we see an event.

The major reason that we don’t buy Insurance is that we have no idea what plan/company is good and we do not understand the common terms used in the Insurance industry.

To help you understand your insurance policy and the terms used along with it, we are trying to explain major terms here.

Annuity Plans

These plans provide for a pension plan which is a mix of a lumpsum amount and a pension to be paid to the policy holder or his spouse. In the event of death of both of them during the policy period, a lumpsum amount is provided for the nominated person.

Accident Benefit

Provides for payment of an additional benefit equal to the sum assured in installments on permanent total disability and waiver of subsequent premiums payable under the policy.

Vesting Age

The age at which the receipt of pension starts in an insurance-cum-pension plan

Whole Life Policy

Premiums are paid throughout the life time of person who is assured. This can be with profits or without profits.

Surrender Value

The value payable to the policy holder in the event of his deciding to terminate the policy before the maturity of the policy.

Premium

The payment, or one of the regular periodic payments, that a insurance holder makes to an insurer in exchange for the insurer’s obligation to pay benefits upon the occurrence of the contractually-specified contingence ie death etc.

Premium Back Term Insurance Plans

These provide for refund of all the premiums paid, in the event of the life assured surviving to the end of the policy term. The total sum assured is paid to the beneficiaries in the event death occurs during the policy term.

Maturity Claim

The Payment to the policy holder at the end of the stipulated term of the policy is called maturity claim.

Lapsed Policy

A policy which has terminated by life insurance Company due to non payment of premium within the specified date.

Maturity Claim

The Payment to the policy holder at the end of the stipulated term of the policy is called maturity claim.

Indemnity

Legal principle that specifies an insured should not collect more than the actual cash value of a loss but should be restored to approximately the same financial position as existed before the loss.

Endowment Policy

The assured has to pay an annual premium which is determined on the basis of the assured’s age at entry and the term of the policy. The insured amount is payable either at the end of specified number of years or upon the death of the insured person, whichever is earlier

Coverage

The scope of protection provided under a contract of insurance; any of several risks covered by a policy.

Indemnity

Legal principle that specifies an insured should not collect more than the actual cash value of a loss but should be restored to approximately the same financial position as existed before the loss.

Annuity Plans

These plans provide for a pension plan which is a mix of a lumpsum amount and a pension to be paid to the policy holder or his spouse. In the event of death of both of them during the policy period, a lumpsum amount is provided for the nominated person.

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IDBI Federal Life Bondsurance – Features & Benefits

admin — Thu, 22 Mar 2012 06:27:26 +0000

Get guaranteed return on your investment with life insurance

IDBI Federal Bondsurance Plan is designed for customers looking for guaranteed returns which will not get affected by financial market conditions. It offers guaranteed return on investment along with life insurance cover.

Investment in this Plan is eligible for deduction under Sec 80C of the Income Tax Act and the maturity amount is tax-free under Sec 10(10D) of the Income Tax Act.

Why Bondsurance?

Bondsurance is the ideal plan to beat the ups and downs around you. It provides safety by giving you a guaranteed return on your investment. It also provides a life insurance cover to ensure the financial security of your loved ones. Not only these, it also gives you two tax benefits at the same time.

What is Bondsurance?

IDBI Federal Bondsurance Plan (Bondsurance) is a single premium plan which allows you to make a one-time investment and get a guaranteed amount on maturity. You can choose a maturity period of 5 or 10 years for your investment. At the end of the chosen period, you will receive a guaranteed maturity amount.

A. Guaranteed Return on your investment

Bondsurance gives you guaranteed returns on your one-time investment. All you have to do is choose the Maturity Benefit, and the Maturity Period for your investment. Based on your choice, the investment you have to make by way of single premium is determined.

- Maturity Benefit

Guaranteed Return on your investment with life insurance.

You can choose any amount as the Maturity Benefit. The amount you choose is guaranteed and will be paid to you on the maturity date.

- Maturity Period

You can choose the Maturity Period, which can be either 5 or 10 years. The Maturity Period is also the policy term of your Bondsurance™.

- Single Premium Amount

The single premium amount is based on your choice of Maturity Benefit, Maturity Period and the age of the Insured Person in completed years as on the date of application, as per the Premium Table below. Minimum single premium payable is Rs 20,000. There is no maximum limit.

PREMIUM TABLE
Age of the Insured Person (in completed years)	Premium per Rs1000 of Maturity Benefit
Age of the Insured Person (in completed years)	Maturity Period 5 years	Maturity Period 10 years
8-32	Rs 712.10 (from age 13 years)	Rs 487.16 (from age 8 years)
33-37	Rs 716.69	Rs 494.45
38-42	Rs 726.75	Rs 509.38
43-47	Rs 744.94	Rs 539.42
48-52	Rs 782.09	Rs 598.54
53-55	Rs 858.60	Not Available
Note: The above premiums are exclusive of service tax and education cess, which are payable in addition. Premiums may be revised based on market conditions.

B. Life Insurance Cover of 5 times the invested amount

Besides giving assured returns, Bondsurance also provides a life insurance cover. In the unfortunate event of death of the Insured Person before the maturity date, a Death Benefit equal to five times the single premium amount will be paid. The Death Benefit (which is the Sum Insured) is guaranteed. The Plan will terminate upon payment of Death Benefit. The life insurance cover ensures that the financial security of loved ones is secured.

Advantage Bondsurance

A. Discount on Single Premium Account increases your effective return

If you choose a Maturity Benefit of Rs 1, 50,000 or higher for your Bondsurance Plan, you will also get a discount on the single premium amount as per the Discount Table below. As a result of the discount, the single premium payable will reduce and your effective return will increase.

PREMIUM TABLE
Maturity Benefit	Discount for 5 year Maturity Period	Discount for 10 year Maturity Period
Rs 1,50,000 to Rs 3,99,999	2.0%	3.5%
Rs 4,00,000 to Rs 9,99,999	2.5%	4.5%
Rs 10,00,000 and above	3.0%	5.25%

Discount rate applies on the premium as per the Premium Table. Service tax and education cess are payable on the single premium amount after discount

B. Premature Surrender facility provides liquidity before maturity

IDBI Federal Bondsurance Plan also provides liquidity before maturity. In case of an urgent financial need, you have the option to prematurely redeem your Bondsurance Plan by surrender after one year. You will receive Special Surrender Value, which will be announced by us from time to time. The surrender value is at least 80% of the single premium paid.

C. Tax Benefits enhance your returns

IDBI Federal Bondsurance Plan is designed to give you attractive tax benefits. Bondsurance gives you two benefits under the Income Tax Act, 1961: Sec 80C and Sec 10(10D).

- Deduction under Sec 80C

Your investment in Bondsurance is eligible for deduction under Sec 80C of the Income Tax Act, 1961, up to the limit of Rs 1, 00,000 (along with other eligible investments). Thus you save income-tax when you invest in Bondsurance.

- Tax-free Benefits under Sec 10(10D)

The Maturity Benefit and also the Death Benefit are tax-free under Sec 10(10D) of the Income Tax Act, 1961, without any limit. There is also no tax deduction at source. Thus your investment grows in Bondsurance free of any tax impact. The benefits above are as per present tax laws. Please note that tax laws may change from time to time. You are also advised to consult and be guided by your tax advisor.

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Edelweiss Tokio Life Cashflow Protection – Features & Benefits

admin — Wed, 14 Mar 2012 09:58:52 +0000

• Avail protection for whole life

• Get guaranteed income up to 100 years of age

• Guaranteed maturity benefit enables you to plan the maturity amount

• Sharing of profits enables you to earn higher returns through additional cash bonus

• Limited payment periods allow you to pay from your present income for your future needs

• Get discounts for higher Sum Assured

• Loans available against the policy to meet unforeseen needs

Plan Summary

This is a non-linked, participating endowment assurance money back plan

Entry Age of Life Insured (Last Birthday)	5 to 65 years
Minimum Maturity Age (Last Birthday)	85 years
Maximum Maturity Age (last birthday)	100 years
Minimum Policy Term	85 years less age at entry of the life insured
Maximum Policy Term	95 years
Premium paying Term	10/15/20
Premium Payment frequency	Annual, Semi-annual, Quarterly and Monthly
Minimum sum assured	Rs.75000(multiple of 1000)
Maximum sum assured	No Limit, subject to underwriting
Minimum Premium	Rs.5702
Maximum Premium	No Limit

# 3% Premium discount on annual mode.

Benefits –

A) Guaranteed Accrual benefits – is equal to 5% of sum assured per annum and payable on maturity or death earlier. The accrual happens every year for limited period starting from 5th policy anniversary and continues till one year before the money back payout begins.

B) Money Back – is equal to 5% of sum assured, payable annually and the payout starts at different points of time (as per table below) depending on premium paying term and continues to be paid till maturity.

C) Cash Bonus – is discretionary and depends on the performance of the par fund. This Start along with the money back payout and continues to be paid till maturity.

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Latest New Plans Launched in March 2012

admin — Tue, 06 Mar 2012 10:17:32 +0000

Latest New Plans Launched in March 2012

IDBI Federal Life Launched New Plan

- IDBI Federal Life Bondsurance

Sahara India Life Launched Vatsalya Jeevan Bima

- Sahara Vatsalya Jeevan Bima

Edelweiss Tokio Life Insurance Launched New Plan

- Edelweiss Tokio Life CashFlow Protection

Met Life Launched New Retirement Plan

- Met Deferred Monthly Income Plan

LIC Launched New Plan

- LIC Jeevan Vriddhi

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Latest New Plans Launched in Feb 2012

admin — Tue, 06 Mar 2012 09:57:57 +0000

Latest New Plans Launched in Feb 2012

Bharti AXA Life Launched online Plan – eProtect

- Bharti AXA Life eProtect

Bajaj Allianz General Insurance Launched Critical Illness plan

- Bajaj Allianz Critical illness Cover for Women

Edelweiss Tokio Life Insurance Launched Two Term Plans

- Edelweiss Tokio Life Protection

- Edelweiss Tokio Life Income Replacement

Aegon Religare Life launched Guaranteed Income Plan

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Latest New Plans Launched in Jan 2012

admin — Thu, 19 Jan 2012 09:53:03 +0000

Latest New Plans Launched in Jan 2012

LIC Launched Jeevan Ankur Child Plan

- LIC Jeevan Ankur

Aegon Religare Life Launched Educare Plan

- Aegon Religare Educare Plan

Aegon Religare iTerm With Improved and New Features

- Aegon Religare iTerm

Apollo Munich Launched Optima Restore Plan

- Apollo Munich Optima Restore

IDBI Federal Life launched Child Insurance Plan

- Childsurance Dreambuilder Insurance Plan

HDFC Life Launched Click2Protect online term insurance plan

- HDFC Life Click 2 Protect

Star Union Dai-ichi launched traditional endowment plan

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United India to manage TN`s health insurance

admin — Sat, 14 Jan 2012 06:56:24 +0000

The Tamil Nadu government has awarded the state government-sponsored health insurance contract to public sector general insurer United India Insurance Company.

The new scheme, which replaced the DMK Government’s Kalignar Health Insurance Scheme, extends medical cover up to Rs 4 lakh for four years, up from Rs 1 lakh in the earlier scheme. It is expected to generate a premium of around Rs 600 crore.

Company and government officials have confirmed that United India is the new partner for the government.

The scheme, which will be launched by chief minister J Jayalalithaa on Wednesday, will also cover 950 types of medical treatment, while the previous scheme covered 642 types.

The Project Director of Tamil Nadu Health System society will pay the premium on behalf of the beneficiaries.

The earlier scheme, which was managed by Star Health Insurance, was scrapped by the AIADMK government, which took charge in May 2011.

Sources said the new scheme would give priority to government hospitals, over those in private sector.

[Source - BS]

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Age barrier for health policies may go

admin — Fri, 13 Jan 2012 06:06:11 +0000

Regulator as well as insurers keen on such policies, but pricing may be a trouble.

The Insurance Regulatory and Development Authority (Irda) is looking to do away with the age limit for purchasing insurance policies. Even as the proposal is still at a nascent stage, the regulator is in the process of clearing products targeted at senior citizens.

By allowing policyholders to renew policies at any age, Irda has already taken the first step to make health policies ‘age free’. It had recently made it mandatory for policies to have a “life long” renewal clause. This means once a health insurance policy is issued, insurers would be obliged to continue renewing such policies during the policyholder’s lifetime. However, the entry age barrier remains.

Meanwhile, some general insurance companies have already started applying for an ‘age-free’ policy. For instance, Apollo Munich Insurance applied for such a policy a few months back and is awaiting approval.

L&T Insurance, on the other hand, has an interesting variant which permits lifetime renewal but mandates a co-payer after the age of 70. Even ICICI Lombard is looking at a lifetime renewal policy. “We will be coming out with a plan where policies issued once could be renewed throughout the lifetime of the policyholder. However, the final entry age for our health policies is 65 years,” said a senior official at ICICI Lombard GIC.

Other insurance companies are expected to follow suit or add necessary clauses in their existing portfolio of products. At present, the entry age for most existing health insurance plans is capped at 65 years.

When contacted, Irda chairman J Hari Narayan said there had been discussions about removing the entry age gap. “However, there are no concrete plans as of now,” he said.

But, the regulator is looking into these products carefully. Senior officials at Apollo Munich said though the first application was made a while back, Irda sent it back with queries. They have reapplied for the product and are awaiting a response.

For most insurers, pricing remains the main issue with policies. For a Rs 5-lakh cover for someone aged 75-80 years, the premium should not be more than 15 per cent of the cover. “But, since the loss ratio beyond 80 years is high and most people of that age suffer from some illness, the real challenge is underwriting such a product,” said a senior official at Apollo Munich Health Insurance.

As a result, the pricing for a Rs 5-lakh policy (for persons over 70 years) is expected to be around Rs 60,000-80,000 annually. In addition, there would be certain conditions, subject to the health of the individual. “For example, some existing chronic diseases might be excluded from the cover,” the official added. Another official of a standalone health insurance company said they would be filing a product without any entry age cap with the regulator soon, even as the premiums would be slightly higher.

According to industry estimates, the health insurance business constitutes more than 25 per cent of the general insurance industry. Over the last one year, premiums have risen 25 per cent. During April-September this financial year, the health insurance premium collection rose 21.3 per cent to Rs 6,721.53 crore from Rs 5,540.34 crore.

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