Following regulators : IRDA launches Insurance Repository System, the first of its kind in the World

Dated : 17th Sep, 2013

Source : IRDA

Hon. Union Finance Minister, Shri. P Chidambaram, formally launched the Insurance Repository System (IR) on 16th Sept, 2013. The Honourable Finance Minister also handed over the first e-Insurance Accounts opened by the Insurance Repositories in the august presence of Shri Rajiv Takru, Secretary, Department of Financial Services, Govt. of India and IRDA Chairman, Shri. T S Vijayan.

Insurance Repository system for individual policy holders is a pioneering initiative of India’s Insurance Regulatory and Development Authority (IRDA), the first of its kind in the world, as part of its efforts to improve services to policy holders and Insurance penetration.

Insurance Repository system will enable policy holders to buy and keep insurance policies in dematerialized or electronic form (e-Policies). e-Policies will eliminate paper and associated risks of storage and loss and provide convenience and safety to the customer. It will also make it a economical preposition for Insurance companies to issue and service e policies as compared to traditional paper policies. This reduced cost will make lower ticket policies much more viable and is expected to give a further boost to greater penetration of insurance in India.
IRDA has licensed five entities – NSDL Database Management Ltd., Central Insurance Repository Ltd., SHCIL Projects Ltd., Karvy Insurance Repository Ltd., and CAMS Repository Services Ltd. – to act as Insurance Repositories (IRs). The IRs will also act as a single point of service for all e Policies held by a policy holder, making it convenient for policy holders to get service on demand. All the Repositories will be directly regulated by IRDA.

A policy holder needs to open an e Insurance Account (eIA) with an Insurance Repository to be able to buy and keep policies issued by various insurers in electronic mode – be it life, pension, health or general. This account opening is free of cost to the account holder. An Individual can have only one e IA and he will get a unique e Insurance Account number. Once an e IA is opened, a policy holder can keep all his e policies, both life and general, issued by various Insurers, under this single account. Initially, this facility is launched for life insurance policies which are of long term nature.

A policy holder can also convert existing policies (in paper form) into electronic form by submitting a request for conversion after opening an e IA. Once a person has an e-IA, he doesn’t have to go through the KYC process every time he buys a new insurance policy. Further, any changes to personal details like address can be effected through a single request to the Repository.
Over a period of time, Insurance Repositories will be able to provide a number of services to the policy holders. It will help insurers to bring efficiency in dealing with the requirements of the policyholders and at the same time cut down their costs. As dematerialization is expected to bring down the cost of issuing and servicing policies, the IRs will be paid directly by the Insurers for these services rendered. No additional cost will need to be paid by the policyholders.
As part of this IR initiative, IRDA has set up iTrex, an Insurance Transaction Exchange to facilitate data interchange between the Repositories and Insurance Companies.
On this occasion, Hon’ble Union Finance Minister also released the Handbook on Insurance Repositories. He advised to come out with an action plan to ensure availability of all Insurance Policies in the repository system.

Hon’ble Minster also reviewed the Budget related announcements made by him that have a bearing for furthering Insurance reach. Secretary, Department of Financial Services was also present on the occasion.

During the interface with the Authority Members, he advised to work for greater persistency and also to increase the usage of Web Aggregation space for the growth of the Insurance Sector. He also advised to increase the Financial Education measures and start a campaign to promote Life Insurance and its benefits to the people at large.

Following claim rejections : Insurance firm told to pay up Rs 40 lakh policy

Dated : 17th Sep, 2013

Source : Indian Express

The Haryana State Consumer Disputes Redressal Forum slapped a penalty of Rs 50,000 on an Insurance Company after finding the settlement of a life insurance claim faulty. The Forum directed the comapany to pay Rs 40 lakh as the insurance amount which was earlier repudiated, to the mother of ahiwani resident.

Late Yudhvir Singh, had purchased a Life Insurance policy from Birla Sunlife Insurance in December 2011 which was slated to mature after thirty years. Singh, however, died in a road accident in April, 2012. When his mother, Ram Ratti Devi approached the company with the requisite documents to claim the aforesaid policy, her plea was rejected.

The insurance firm claimed that the replies filed by Singh were false as he was suffering from Tuberculosis (TB) and was undergoing treatment for the same before submitting the proposal form. The company maintained that it was misled to issue the policy and was justified in repudiating the claim.

Insurance Planning : Important factors to keep in mind while buying a child insurance plan

Dated : 12th Sep, 2013

Selecting an insurance policy for children is one of the best ways to secure their future. Child plans can take care of your child’s higher education and marriage expenses. In the event of demise of the main breadwinner, a child plan will take care of the child's future.It is equally important to select the right policy that gives you maximum benefit.

Few important factors which you need to keep in mind while buying a child insurance plan:

Maturity benefit: 

Children’s insurance plans are designed in such a manner that your child is protected financially at every important stage of his life. Most often, the maturity of child plans is around a specific stage of a child’s life. Most child insurance plans will offer a maturity period which is related to your child’s age, for instance, when he child turns 18, 21 or 24 years.

Adequate protection: 

The most important benefit of buying a child insurance plan is to protect your child in case of an unfortunate event. A good insurance policy covering your children’s financial needs can take care of their welfare even in case of your absence.

Premium waiver benefit: 

In case of death of the provider, premium waiver benefit allows continuation of the plan without the burden of further premium payments. Thus choosing a comprehensive child insurance policy that provides maximum benefits will not only ensure that all your child’s needs are met, but also that his future is financially secure even if you are no longer around.

Following regulator - IRDA : Banks can only sell standard insurance products through branch

Dated : 10th Sep, 2013

Source : PTI

Banks will be allowed to sell only standard or vanilla insurance products through their branches following the relaxation of brokerage norms by the sectoral regulator Irda, said a finance Ministry official.

The move is aimed at ensuring that lenders do not sell customised insurance products where risk assessment is more complex.

It will also address various concerns of the Reserve Bank, including those pertaining to conflict of interest. RBI does not want banks to undertake new risk in the form of insurance broker.

"Products with same features will not only prevent mis- selling but also ensure that customers can chose a product based on the performance and efficiency of the insurer," the official said.

Irda will ensure that all products sold through banks are standardised in terms of features and commission structure, the official added.

A broking licence will allow a bank to sell products of multiple insurance firms, compared with the current bancassurance model that allows lenders to sell products of just one life and non-life insurance company.

Banks have wide network of delivery channel, over 1 lakh branches, which can be leveraged to increase insurance penetration in the country.

Finance Minister P Chidambaram in his budget speech this year had said: "Banks will be permitted to act as insurance brokers so that the entire network of bank branches will be utilised to increase penetration."

Life insurance penetration in the country is as low as 4.4 per cent of GDP.

Last month, the Insurance Regulatory and Development Authority (Irda) notified rules allowing banks to act as brokers of insurance companies, a process termed as bancassurance.

As per the norms, there is no capital requirement for insurance broking business carried out by banks, according to Irda (Licencing of Banks as Insurance Brokers) Regulations, 2013.

To qualify for the licence, each bank will have to have the principal officer - an officer of general manager or equivalent category, who is appointed exclusively to carry out the functions of an insurance broker. The licence, once issued, will be valid for three years from the date of issue, it said, adding that the renewal of licence can be applied 30 days before expiry of licence. Every insurance broker will, before the commencement of the business, deposit and keep deposits with any scheduled bank as sum of Rs 50 lakh, it said.

Following claim rejections : Death due to heart attack at job place is employment injury - High Court

Dated : 10th Sep, 2013

Source : PTI

Death due to heart failure at work place amounts to employment injury, the Bombay High Court has held and ordered Employees State Insurance Corporation (ESIS) to pay within a month the claim amount to a 40-year-old housewife whose husband died of cardiac arrest in a factory.

The order was passed by justices K R Sriram and V M Kanade, on September 5, on a petition filed by the widow of Bharguram Mahadik, who worked as a fitter on a meagre salary of Rs 6,000 with Dhanwantari Engineers Pvt Ltd.

Bharguram was registered with ESIS scheme. On March 27 last year, he complained of chest pain and his colleagues took him to a resting area within the factory premises and asked him to rest for a while. As his condition worsened, he was rushed to the Navi Mumbai Municipal Corporation at Vashi.

The provisional cause of death in the certificate issued on the same day mentioned that the insured was "brought dead" to the Hospital. The Insured was declared as dead by the Medical Officer of NMMC Hospital and the cause of death was mentioned as "Acute Myocardial Infarction". At the time of death he was about 50 years old.

The employer of the insured raised a claim for the dependents under the ESI Act on April 11, 2012 but it was rejected by ESIS on May 14. One of the ground said that the deceased cannot be treated as an employee under the ESIS Act. The ESIS refused to pay the claim, saying that the injury sustained by the employee cannot be treated as an Employment injury under the Act. It further said the insured person had died of natural causes and the death was not related to stress and strain of work.

Following regulators :All you wanted to know about insurance repository

Dated : 7th Sep, 2013

Insurance Repository means a company formed and registered under the Companies Act, 1956 (1 of 1956) and which has been granted a certificate of registration by IRDA for maintaining data of insurance policies in electronic form on behalf of Insurers.

Insurance repository provides policyholders a facility to keep insurance policies in electronic form and to undertake changes, modifications and revisions in the insurance policy with speed and accuracy. In

addition, the repository acts as a single stop for several policy service requirements.

Insurance repositories cannot sell/solicit insurance policies. They are authorized only to maintain the policies in electronic form and provide a service record of all insurance policies.

What is an eIA (e-Insurance account)?

eIA stands for e-Insurance Account or “Electronic Insurance Account” which will safeguard the insurance policy documents of policyholders in electronic format. This e-Insurance account will facilitate the policyholder by providing access to the insurance portfolio at a click of a button through internet.

Currently, IRDA has granted the Certificate of Registration to the following five entities to act as

Insurance repositories that are authorized to open e-Insurance Accounts.

1. M/s NSDL Database Management Limited

2. M/s Central Insurance Repository Limited

3. M/s SHCIL Projects Limited

4. M/s Karvy Insurance Repository Limited

5. M/s CAMS Repository Services Limited

Each e-Insurance Account will have a unique Account number and each account holder will be granted a unique Login ID and Password to access the electronic policies online.

Is there a charge for opening of e-Insurance Account or on periodic basis?
No. e-Insurance account is offered free of cost to the applicants.

Can any individual open more than one e-insurance account with any Insurance Repository?

No. As per the IRDA guidelines, an individual cannot open multiple e-Insurance accounts.

What is an e-Insurance account application form? Where can it be obtained from?

An e-Insurance account application form is one that is used by an individual to open an e-insurance

account with the Insurance Repository. This form would be available with Insurance Company, Insurance Repository or an Approved Person.

Insurance planning : What are the benefits of holding Insurance Policies in electronic form?

Holding insurance policies in electronic form offers multiple benefits such as:

Safety: There is no risk of loss or damage of a policy as is common with paper policies; the electronic form ensures that the policies are in safe custody and can be easily accessed whenever and wherever needed. A copy of the policy can be downloaded at any time by accessing the e-Insurance account.

Convenience: All insurance policies, be it life, pension, health or general, can be electronically held under a single e-Insurance account. This means all details of all policies are available in a single account (place). The details of any of the policies can be accessed at any time by logging on to the online portal of Insurance Repository.

Single Point of Service: Service requests in respect of e-Insurance account or any of the electronic policy can be submitted at any of Insurance Repository’s service points. A single request can sometimes cater to the requirements of several Insurers. As an illustration, a single change of address request made to the Insurance Repository can update the policies issued by multiple Insurers. There would be no need to go to several offices of individual Insurers for service.
Dated : 7th Sep, 2013

Source : IRDA

Less Paper work and savings in time: An e-Insurance account holder is freed from the trouble of submitting KYC details each time a new policy is taken. Further, any changes in personal details like address or contact number can be effected through a single request thus saving on paper and time.

Statement of Account: At least once every year, the Insurance repository would send a statement of account to the e–Insurance account holder with the details of the policies of the account holder.

Payment Options: Premium for all the policies can be paid online and several service requests can be logged from the e-Insurance account.

Increased number of service touch points: Since, the Insurance repositories function in addition to the Insurers, the policyholders will have increased number of touch points for having their servicing needs attended.

Easy payout transfers: Policy benefits would be paid through electronic facility to the registered bank account, thus ensuring speedier and convenient settlement.

Single view: Single view of all policies will be made available to an authorized person in case of death of the e-Insurance account holder.

Following inflation effects : The rise in onion prices have hit street vendors harder than most

Dated : 7th Sep, 2013

Source : Forbes India

The trebling of onion prices—from Rs 24 per kilo to Rs 70 per kilo—since April has been hurting not just household budgets, but street food vendors as well. 

Sellers of onion bhajis, who operate on very slim margins, have had to raise prices from Rs 20 to Rs 30 a plate since the beginning of the year. Some vendors have stopped selling the popular snack altogether because they feel customers will simply not be willing to pay beyond a certain price. 

High-end pubs and bistros, on the other hand, have seen only a marginal increase in the price of onion rings (for which they charge Rs 150 to Rs 190), and no fall in sales. Operating on very high margins, prices at these places see only yearly revisions, and are not affected by temporary spikes.

Source : http://forbesindia.com/article/findex/rising-onion-prices-take-a-toll-on-snacks/36085/1#ixzz2eCB2jbCz