Sunday, October 19, 2008
LIC PENSION FUND HOLDS 1ST AGM
The first annual general meeting of the board of LIC Pension Fund, which was held in Mumbai on Wednesday, reviewed the progress of the company including regulatory compliance, risk management, corporate governance, progress in business development and internal audit. T. S. Vijayan, chairman of the company, expressed confidence in the strength o0f LIC Pension Fund and visualized a bigger role in the pension market. H Sadhak, CEO, LIC Pension Fund informed that the company has been managing its entire operation fully independently from its own corporate office and complied with all regulatory requirement.
Source: The Financial Express
Source: The Financial Express
TRY WEATHER-BASED INSURANCE
New Delhi: The non-clearance of insurance claims can render any risk mitigation product worthless. It is worse when the victims are hapless farmers who, having lost their crops, are deprived of compensation despite having insurance cover under the government-supported National Agricultural Insurance Scheme (NAIS). Unpaid insurance claims are reckoned to have mounted to over Rs 920 crore, owing largely to the failure of state governments to put in their share of the money for running the scheme. This is not the only problem with NAIS, which was evolved after decades of experimentation with over half-a-dozen models of farm insurance products since the 1980s. As the findings of some studies, including the National Sample Survey, have revealed, a large proportion of farmers are either unaware of the available risk management scheme, or are not opting for it because it offers little by way of gain. Inappropriate procedures for assessing crop yield in order to determine the compensation that has to be paid, invariably leave the farmers dismayed. Several other irksome issues have also remained unaddressed, including those concerning the unit area for the operation of the scheme, benchmarks for assessing crop losses, the extent of risk coverage and the amount of premium to be charged.
The fundamental problem with all the agricultural insurance models that have been tried out and discarded till now, is the lack of economic viability despite the government’s financial support. In the case of NAIS, too, the premium-claims ratio is a hopeless 1:3.3. The scheme, therefore, requires heavy subsidisation by governments at the Centre and in the states, which becomes fiscally difficult to sustain. Surprisingly, though the government is in possession of the reports of the joint group that went into the changes required in the agricultural insurance scheme, as well as of the working group that vetted the joint group’s report, a modified NAIS based on the recommendations of these two bodies is yet to be unveiled. It does not help, of course, that many of the suggestions mooted by these panels are either impractical or ill-conceived.
For instance, they have suggested that the unit area for operating the scheme be reduced to the jurisdiction of a village panchayat, little realising that this administrative area may not be agriculturally homogeneous. Similarly, their recommendation to move to an actuarial regime for premium calculation may sound good on paper but is bound to pose operational problems for a national-level programme, as the actuarial premium would vary from state to state, and even from one region to another within a state. Moreover, the plea that any insurance scheme involving government subsidy should not cover high-risk crops is absurd as that defeats the very purpose of providing farm insurance.
Considering the very patchy record of trying to make agricultural insurance work, it may be a good idea to opt for weather-based crop insurance which, as stated in the 2007-08 Budget, appears to be a more promising method of risk mitigation. Some weather-related insurance products are being tried out on a pilot scale by public as well as private sector insurance companies in select states, with encouraging results. Though weather-based insurance, too, may not provide solutions for all the predicaments involved in managing hazard in an inherently risky agricultural business, it has been found to be more practical in almost all the countries where it has been put to the test. There is no reason to believe that India will be an exception.
The fundamental problem with all the agricultural insurance models that have been tried out and discarded till now, is the lack of economic viability despite the government’s financial support. In the case of NAIS, too, the premium-claims ratio is a hopeless 1:3.3. The scheme, therefore, requires heavy subsidisation by governments at the Centre and in the states, which becomes fiscally difficult to sustain. Surprisingly, though the government is in possession of the reports of the joint group that went into the changes required in the agricultural insurance scheme, as well as of the working group that vetted the joint group’s report, a modified NAIS based on the recommendations of these two bodies is yet to be unveiled. It does not help, of course, that many of the suggestions mooted by these panels are either impractical or ill-conceived.
For instance, they have suggested that the unit area for operating the scheme be reduced to the jurisdiction of a village panchayat, little realising that this administrative area may not be agriculturally homogeneous. Similarly, their recommendation to move to an actuarial regime for premium calculation may sound good on paper but is bound to pose operational problems for a national-level programme, as the actuarial premium would vary from state to state, and even from one region to another within a state. Moreover, the plea that any insurance scheme involving government subsidy should not cover high-risk crops is absurd as that defeats the very purpose of providing farm insurance.
Considering the very patchy record of trying to make agricultural insurance work, it may be a good idea to opt for weather-based crop insurance which, as stated in the 2007-08 Budget, appears to be a more promising method of risk mitigation. Some weather-related insurance products are being tried out on a pilot scale by public as well as private sector insurance companies in select states, with encouraging results. Though weather-based insurance, too, may not provide solutions for all the predicaments involved in managing hazard in an inherently risky agricultural business, it has been found to be more practical in almost all the countries where it has been put to the test. There is no reason to believe that India will be an exception.
Source: Business Standard (Editorial)
PREMIUM FOR CROP INSURANCE CAN BE PAID TILL OCTOBER
Perambalur: Farmers, who wish to avail the weather-based crop insurance scheme, can pay the premium for the scheme until October 31, Collector Anil Meshram has said.
Speaking at a consultative meeting on the implementation of the insurance scheme in the district here on Thursday, Mr. Meshram said the scheme was being implemented by the Agriculture Insurance Company of India with assistance from Central and State governments.
For farmers who have availed crop loans, the premium of Rs.225 an acre would be deducted and those who have not taken loans can pay the premium amount and avail an insurance cover of up to Rs.10,000. Further details can be had from the scheme coordinators over the telephone numbers: 9360247160, 9940326750, 9443780661, a release said.
Speaking at a consultative meeting on the implementation of the insurance scheme in the district here on Thursday, Mr. Meshram said the scheme was being implemented by the Agriculture Insurance Company of India with assistance from Central and State governments.
For farmers who have availed crop loans, the premium of Rs.225 an acre would be deducted and those who have not taken loans can pay the premium amount and avail an insurance cover of up to Rs.10,000. Further details can be had from the scheme coordinators over the telephone numbers: 9360247160, 9940326750, 9443780661, a release said.
Source: The Hindu
IFFCO-TOKIO ROPES IN PARESH RAWAL
Actor Paresh Rawal will now be seen on the small screen promoting IFFCO-TOKIO General insurance, for it’s recently launched advertising campaign. IFFCO-TOKIO General Insurance is a trusted player in general insurance and has rolled out its new Muskurate Raho ad campaign. The campaign is titled Albert Pinto kyon muskura raha hain and Paresh Rawal who will be seen ad Albert Pinto.
Source: The Financial Express
ANDHRA BANK LAUNCHES ‘BIMA UTSAV-2008’
Karimnagar: Andhra Bank launched the ‘AB Bima Utsav-II -2008’ coinciding with the festival season from October 15 to December 31, 2008 at all its branches. Speaking to newsmen here on Wednesday, Andhra Bank deputy general manager A. S. Prabhakar said that during this Utsav they would educate customers about various insurance-based policies such as Andhra Bank Jeevan Abhaya and Abhaya Gold, Andhra Bank Arogyadhan-health insurance scheme, loan liability insurance, housing loan, educational loan, vehicle loan etc.
Low-cost deposits
He said the Andhra Bank zone had mobilised 10,000 low-cost deposit accounts, 2,500 LIC policies with premium of Rs 1.25 crore and other products under Andhra Bank touch four campaign, which was completed last month. Giving details about the performance of the bank in the zone which comprises of Karimnagar, Adilabad and Nizamabad districts, he said that they had total business around Rs. 3,635 crore till September 30.
Advances
He said that they had provided Rs. 506 crore as advances to the agricultural sector and Rs. 122 crore to women self-help groups.
New branches
He also said that the bank had decided to open new braches at Armoor (Nizamabad), Bellampally crossroads (Mancherial), Vavilalapally and Bank Colony in Karimnagar town. Assistant general manager I. C.V. Subba Reddy and others were also present.
Low-cost deposits
He said the Andhra Bank zone had mobilised 10,000 low-cost deposit accounts, 2,500 LIC policies with premium of Rs 1.25 crore and other products under Andhra Bank touch four campaign, which was completed last month. Giving details about the performance of the bank in the zone which comprises of Karimnagar, Adilabad and Nizamabad districts, he said that they had total business around Rs. 3,635 crore till September 30.
Advances
He said that they had provided Rs. 506 crore as advances to the agricultural sector and Rs. 122 crore to women self-help groups.
New branches
He also said that the bank had decided to open new braches at Armoor (Nizamabad), Bellampally crossroads (Mancherial), Vavilalapally and Bank Colony in Karimnagar town. Assistant general manager I. C.V. Subba Reddy and others were also present.
Source: The Hindu
TSM TIES UP WITH AEGON RELIGARE LIFE
Chennai: T. S. Mahalingam & Sons (TSM), a reputed name in the used car business, has inked a distribution agreement with nascent AEGON Religare Life Insurance to hawk the latter’s products. The tie-up with TSM is expected to help AEGON Religare beef up its presence in southern India. Also, Religare will have access to over 2.50 lakh potential customers of TSM.
Addressing a press conference here on Thursday, Rajiv Jamkhedkar, CEO, AEGON Religare Life Insurance, said Religare had written 4,000 polices since its launch in August. “We want to build a sustainable business,” he said. The company had already brought in capital to the tune of Rs. 370 crore.
K. Mahalingam, Partner, TSM, said his organisation hoped to provide customised insurance products and bring about a difference in the way life insurance is sold.
Addressing a press conference here on Thursday, Rajiv Jamkhedkar, CEO, AEGON Religare Life Insurance, said Religare had written 4,000 polices since its launch in August. “We want to build a sustainable business,” he said. The company had already brought in capital to the tune of Rs. 370 crore.
K. Mahalingam, Partner, TSM, said his organisation hoped to provide customised insurance products and bring about a difference in the way life insurance is sold.
Source: The Hindu
MAX NEW YORK LIFE LAUNCHES MAX VIJAY SCHEME
Taking a cue from the mobile telecom sector, Max New York Life Insurance on Wednesday, launched Max Vijay, an innovative insurance scheme that has been made affordable, accessible and flexible for the common man.
Marking a paradigm shift in life insurance, the company has made the process of buying life insurance simple with its innovative distribution, marketing as well as service delivery. “Unlike other financial instruments, buying and selling Max Vijay is as simple as buying atta, dal and chawal. In fact, it is as simple as recharging a mobile sim card and can be done by paying a minimum of Rs 10 at the nearest kirana store,” said Anil Mehta, senior director and head, Vijay, Max New York Life Insurance.
Speaking to FE on the sidelines of the launch, Kenneth Sannoo, the company’s director & chief distribution officer said “Uttar Pradesh, the largest state of India, has people, who aspire to achieve more in life and Max Vijay thus offers them the opportunity to partake in the financial inclusion process. It offers life insurance cover to provide financial protection with an opportunity to create wealth by aggregating small savings.”
“Distribution is an integral and perhaps the most important element of this innovative savings plus protection solution. Thus taking Max Vijay to every nook and corner of the country is very important to us. Our strong network will introduce Max Vijay across the state in a few months, through which the customers will be able to avail multiple facilities such as initial purchase, subsequent premiums and partial withdrawals,” said Mehta.
To be available in three premium paying options: Rajat, Swarna, and Heera, the sum assured from the policy is guaranteed with choice to invest any amount, anytime, anywhere.
Marking a paradigm shift in life insurance, the company has made the process of buying life insurance simple with its innovative distribution, marketing as well as service delivery. “Unlike other financial instruments, buying and selling Max Vijay is as simple as buying atta, dal and chawal. In fact, it is as simple as recharging a mobile sim card and can be done by paying a minimum of Rs 10 at the nearest kirana store,” said Anil Mehta, senior director and head, Vijay, Max New York Life Insurance.
Speaking to FE on the sidelines of the launch, Kenneth Sannoo, the company’s director & chief distribution officer said “Uttar Pradesh, the largest state of India, has people, who aspire to achieve more in life and Max Vijay thus offers them the opportunity to partake in the financial inclusion process. It offers life insurance cover to provide financial protection with an opportunity to create wealth by aggregating small savings.”
“Distribution is an integral and perhaps the most important element of this innovative savings plus protection solution. Thus taking Max Vijay to every nook and corner of the country is very important to us. Our strong network will introduce Max Vijay across the state in a few months, through which the customers will be able to avail multiple facilities such as initial purchase, subsequent premiums and partial withdrawals,” said Mehta.
To be available in three premium paying options: Rajat, Swarna, and Heera, the sum assured from the policy is guaranteed with choice to invest any amount, anytime, anywhere.
Source: The Financial Express
BAJAJ FINSERV TO SEEK GOD FOR ASSET MANAGEMENT
Mumbai: Financial service company Bajaj FinServ Ltd is getting ready to enter the assets management business, its managing director said on Thursday. “We desire to get into the business,” Sanjiv Bajaj said on the sideline of an industry conference. He said on the sidelines of an industry conference. He said he was in talks with Germany’s Allianz. Bajaj already runs insurance joint venture with Allianz in India.
Source: Reuters, Mint
Source: Reuters, Mint
A CASE FOR HIGHER DEPOSIT INSURANCE
The world financial market is facing one of the worst crises since the Great Depression of the 1930s. The $700-billion bailout, which some analysts are calling “cash-for-trash”, has barely calmed the international financial market, which is still coming to the grips with the huge fallout of the sub-prime crisis.
Unlike the earlier Savings and Loan Association crisis of the 1980s and 1990s in the US, the present debacle is still playing out, not only in Europe but also in Asia, including developed countries such as Japan and emerging countries such as China and India. It was widely believed by experts the world over that deposit insurance would avert this kind of crisis but it has not. However, it has surely minimised the run on the banks that would have led to a repeat of the 1930s.
Deposit insurance was seen as a measure of protection for depositors, particularly small depositors, from the risk of loss of their savings, arising from bank failures. The purpose was to avoid panic and promote greater stability and growth of the banking system — what in today’s world is termed financial stability.
But in the midst of a crisis in the global banking system, the concern is rather more critical — for many, a matter of survival or otherwise. The common man’s real concern is whether the insurance actually works.
Deposit insurance is at different levels in different part of the world. In India, deposits were covered, in the first Act of 1962, only to the extent of Rs 1,500 — the maximum amount payable was revised upwards to Rs 5,000 from January 1, 1968; to Rs 10,000 from April 1, 1970; to Rs 20,000 from January 1, 1976; to Rs 30,000 from July 1, 1980 and now to Rs 1 lakh from May 1, 1993. Since then, it stands at Rs 1,00,000 ($2,500).
The Government charges a premium of 5 paise, later raised to 10 paise for Rs 100. This covers a customer’s deposit, plus interest per bank in all the branches of the bank, up to a maximum of Rs 1,00,000. If one has an account in more than one bank, he is entitled to cover for another Rs 1,00,000 with each of the banks.
How safe?
As the world is coming to terms with the latest financial crisis, the Indian stock market has lost more than Rs 1,60,000 crore in value. In India, the banking sector has been affected more than the others.
The question being asked by the ‘aam aadmi’ (common man) is: “Is my deposit safe with the banks?” Despite the assurance by the RBI and our Finance Minister, the answer is only relative ‘Yes’, and not an absolute ‘Yes’. Even though our deposits with the banks are reasonably secure it is only due to such assurances, not because of any legal obligation of the fund or the Government.
Deposit insurance, as we know it, was introduced in India in 1962. India was the second country in the world to introduce such a scheme — the first being the United States in 1933. After the setting up of the Reserve Bank of India, the issue came to the fore in 1938, when the Travancore National and Quilon Bank, the largest bank in the Travancore region, failed.
The banking crisis in Bengal between 1946 and 1948 revived the issue of deposit insurance. It was in 1960 that the failure of Laxmi Bank and the subsequent failure of the Palai Central Bank catalysed the introduction of deposit insurance in India. The Deposit Insurance Corporation commenced functioning on January 1, 1962. In 1968, the Deposit Insurance Corporation Act was amended to extend deposit insurance to ‘eligible co-operative banks’.
The 1960s and 1970s were a period of institution-building. 1971 witnessed the establishment of another institution, the Credit Guarantee Corporation of India Ltd (CGCI). In 1978, the DIC and the CGCI were merged. After the merger, the focus of the new entity, the DICGC (Deposit Insurance and Credit Guarantee Corporation), shifted to credit guarantees.
This owed in part to the fact that most large banks were nationalised. With the financial sector reforms initiated in the 1990s, credit guarantees have been gradually phased out and the focus of the Corporation is veering back to its core function of deposit insurance, with the objective of averting panics, reducing systemic risk, and ensuring financial stability.
International practice
The UK has just raised its deposit insurance cover from 30,000 to 50,000 pounds sterling. Ireland recently guaranteed deposits of its six largest lenders. Some countries provide unlimited coverage in response to a crisis. Malaysia, Thailand and Indonesia did so in response to the 2003 crisis. Some countries, such as Japan and Mexico, had unlimited coverage, which was revoked after the crisis seemed to have abated.
The US is actively debating raising the limit from $100,000 to $250,000. Even with the recent increase in the limit of the deposits in various countries, a lot of deposits fall outside the safety net. Britain’s new limit will still leave about two-fifths of the cash in deposits uninsured.
America’s proposed change would do no more than reduce the part of the deposit base that is unprotected from 38 per cent to 27 per cent. The idea of a quarter or more of a big bank’s deposit base being wiped out is politically unthinkable. Indeed, when Wachovia, America’s fourth-largest commercial bank by assets, was rescued this week, the FDIC created a structure that protected all deposits. It has done so with other banks, too.
It is time the RBI and the Centre took another look at deposit insurance in India. When the Government has increased the annual income level of the ‘creamy layer’ to Rs 4.5 lakh, it is imperative that the RBI increases the limit to at least Rs 500,000 as the minimum deposit amount to be covered by insurance in the current context.
Raise the limit
The Government has to review, like other countries, an increase the insurance limits to avoid the flight of money too. India should also consider introducing optional co-insurance that is available in a few countries that will offer depositors the option to purchase additional cover by collecting additional premium from the depositors over the statutory limit of the deposit’s tenure, so that the tax-payers alone are not saddled with paying for the banks’ and big depositors’ possible bailouts in the future.
It was also felt that an additional purpose of a deposit insurance scheme would be to increase the confidence of depositors in the banking system and facilitate the mobilisation of deposits to enable growth and development. The traditional criticism of such insurance, however, is that it may indirectly encourage banks to take more risk. Hence, it is imperative on the RBI to ensure that the banks do not speculate, like the financial institutions in the US did.
Even after collecting the premium on all deposits over the set limit, it may not, under all circumstances, be possible to cover all kinds of bankruptcy. Even in the US, FDIC’s available funds, including untapped credit lines from the Treasury, are equivalent to just 1.5 per cent of total deposits of commercial banks. Ultimately, if the public thinks that multiple failures of big banks are likely, only the government can offer a credible guarantee to infuse confidence in the banking system.
Source: The Hindu Business Line
Unlike the earlier Savings and Loan Association crisis of the 1980s and 1990s in the US, the present debacle is still playing out, not only in Europe but also in Asia, including developed countries such as Japan and emerging countries such as China and India. It was widely believed by experts the world over that deposit insurance would avert this kind of crisis but it has not. However, it has surely minimised the run on the banks that would have led to a repeat of the 1930s.
Deposit insurance was seen as a measure of protection for depositors, particularly small depositors, from the risk of loss of their savings, arising from bank failures. The purpose was to avoid panic and promote greater stability and growth of the banking system — what in today’s world is termed financial stability.
But in the midst of a crisis in the global banking system, the concern is rather more critical — for many, a matter of survival or otherwise. The common man’s real concern is whether the insurance actually works.
Deposit insurance is at different levels in different part of the world. In India, deposits were covered, in the first Act of 1962, only to the extent of Rs 1,500 — the maximum amount payable was revised upwards to Rs 5,000 from January 1, 1968; to Rs 10,000 from April 1, 1970; to Rs 20,000 from January 1, 1976; to Rs 30,000 from July 1, 1980 and now to Rs 1 lakh from May 1, 1993. Since then, it stands at Rs 1,00,000 ($2,500).
The Government charges a premium of 5 paise, later raised to 10 paise for Rs 100. This covers a customer’s deposit, plus interest per bank in all the branches of the bank, up to a maximum of Rs 1,00,000. If one has an account in more than one bank, he is entitled to cover for another Rs 1,00,000 with each of the banks.
How safe?
As the world is coming to terms with the latest financial crisis, the Indian stock market has lost more than Rs 1,60,000 crore in value. In India, the banking sector has been affected more than the others.
The question being asked by the ‘aam aadmi’ (common man) is: “Is my deposit safe with the banks?” Despite the assurance by the RBI and our Finance Minister, the answer is only relative ‘Yes’, and not an absolute ‘Yes’. Even though our deposits with the banks are reasonably secure it is only due to such assurances, not because of any legal obligation of the fund or the Government.
Deposit insurance, as we know it, was introduced in India in 1962. India was the second country in the world to introduce such a scheme — the first being the United States in 1933. After the setting up of the Reserve Bank of India, the issue came to the fore in 1938, when the Travancore National and Quilon Bank, the largest bank in the Travancore region, failed.
The banking crisis in Bengal between 1946 and 1948 revived the issue of deposit insurance. It was in 1960 that the failure of Laxmi Bank and the subsequent failure of the Palai Central Bank catalysed the introduction of deposit insurance in India. The Deposit Insurance Corporation commenced functioning on January 1, 1962. In 1968, the Deposit Insurance Corporation Act was amended to extend deposit insurance to ‘eligible co-operative banks’.
The 1960s and 1970s were a period of institution-building. 1971 witnessed the establishment of another institution, the Credit Guarantee Corporation of India Ltd (CGCI). In 1978, the DIC and the CGCI were merged. After the merger, the focus of the new entity, the DICGC (Deposit Insurance and Credit Guarantee Corporation), shifted to credit guarantees.
This owed in part to the fact that most large banks were nationalised. With the financial sector reforms initiated in the 1990s, credit guarantees have been gradually phased out and the focus of the Corporation is veering back to its core function of deposit insurance, with the objective of averting panics, reducing systemic risk, and ensuring financial stability.
International practice
The UK has just raised its deposit insurance cover from 30,000 to 50,000 pounds sterling. Ireland recently guaranteed deposits of its six largest lenders. Some countries provide unlimited coverage in response to a crisis. Malaysia, Thailand and Indonesia did so in response to the 2003 crisis. Some countries, such as Japan and Mexico, had unlimited coverage, which was revoked after the crisis seemed to have abated.
The US is actively debating raising the limit from $100,000 to $250,000. Even with the recent increase in the limit of the deposits in various countries, a lot of deposits fall outside the safety net. Britain’s new limit will still leave about two-fifths of the cash in deposits uninsured.
America’s proposed change would do no more than reduce the part of the deposit base that is unprotected from 38 per cent to 27 per cent. The idea of a quarter or more of a big bank’s deposit base being wiped out is politically unthinkable. Indeed, when Wachovia, America’s fourth-largest commercial bank by assets, was rescued this week, the FDIC created a structure that protected all deposits. It has done so with other banks, too.
It is time the RBI and the Centre took another look at deposit insurance in India. When the Government has increased the annual income level of the ‘creamy layer’ to Rs 4.5 lakh, it is imperative that the RBI increases the limit to at least Rs 500,000 as the minimum deposit amount to be covered by insurance in the current context.
Raise the limit
The Government has to review, like other countries, an increase the insurance limits to avoid the flight of money too. India should also consider introducing optional co-insurance that is available in a few countries that will offer depositors the option to purchase additional cover by collecting additional premium from the depositors over the statutory limit of the deposit’s tenure, so that the tax-payers alone are not saddled with paying for the banks’ and big depositors’ possible bailouts in the future.
It was also felt that an additional purpose of a deposit insurance scheme would be to increase the confidence of depositors in the banking system and facilitate the mobilisation of deposits to enable growth and development. The traditional criticism of such insurance, however, is that it may indirectly encourage banks to take more risk. Hence, it is imperative on the RBI to ensure that the banks do not speculate, like the financial institutions in the US did.
Even after collecting the premium on all deposits over the set limit, it may not, under all circumstances, be possible to cover all kinds of bankruptcy. Even in the US, FDIC’s available funds, including untapped credit lines from the Treasury, are equivalent to just 1.5 per cent of total deposits of commercial banks. Ultimately, if the public thinks that multiple failures of big banks are likely, only the government can offer a credible guarantee to infuse confidence in the banking system.
Source: The Hindu Business Line
OPTIMA ONLINE SERVICE TO INSURE TWO-WHEELERS
Coimbatore: Retail insurance site www.click2insure.in is in the process of introducing two-wheeler insurance cover online in the national capital region. The site, promoted by Optima Insurance Brokers, aims to resolve the inconvenience faced by two-wheeler owners on the policy renewal front.
The company has, in the pilot phase, rolled out the service at a grocery store — LM 365, Mayur Vihar, New Delhi. It plans to extend the service across the grocery store chain (comprising 75 stores in Delhi) in a phased manner. Explaining the need for introducing such a service, Mr Rahul Aggarwal, CEO, Optima Insurance Brokers and click2insure.in, said “agents’ commission tends to dip with the slip in the value of the policy. There is not enough money to motivate them to chase a renewal. Insurers too have a thin margin on two-wheeler insurance and so, do not send reminders. The site, therefore, would provide an opportunity for two-wheeler owners to get their vehicles insured conveniently.”
Preventing break in policy
He further pointed out that a break in insurance policy compounded the problem. “With the introduction of this service, a representative from click2insure will be present in LM 365 store to help the vehicle owners avail the cover by registering their policy on the spot,” Mr Aggarwal said, adding there was good response to the service.
The company has, in the pilot phase, rolled out the service at a grocery store — LM 365, Mayur Vihar, New Delhi. It plans to extend the service across the grocery store chain (comprising 75 stores in Delhi) in a phased manner. Explaining the need for introducing such a service, Mr Rahul Aggarwal, CEO, Optima Insurance Brokers and click2insure.in, said “agents’ commission tends to dip with the slip in the value of the policy. There is not enough money to motivate them to chase a renewal. Insurers too have a thin margin on two-wheeler insurance and so, do not send reminders. The site, therefore, would provide an opportunity for two-wheeler owners to get their vehicles insured conveniently.”
Preventing break in policy
He further pointed out that a break in insurance policy compounded the problem. “With the introduction of this service, a representative from click2insure will be present in LM 365 store to help the vehicle owners avail the cover by registering their policy on the spot,” Mr Aggarwal said, adding there was good response to the service.
Source: The Hindu Business Line
MATERNITY BENEFIT TO COME UNDER RASHTRIYA SWASTHYA BIMA YOJANA
New Delhi: The Union Cabinet on Thursday approved inclusion of maternity benefit under the Rashtriya Swasthya Bima Yojana (RSBY), subject to the condition that the premium is within the existing limit of Rs.750 per beneficiary. The modification would be applicable with immediate effect and this would encourage institutional delivery among those workers living below the poverty line.
The RSBY was launched on October 1 last year for the BPL population in the unorganised sector. The scheme is being implemented by the State governments through insurance companies by inviting bids from both public and private companies. Almost all States have agreed to implement the scheme during the current year with Haryana, Punjab, Delhi, Gujarat, Bihar, Jharkhand and Tamil Nadu already starting enrolment and issuing smart cards. As many as 12 States have initiated the process and the remaining are likely to start implementation soon.
Until September 23, more than 3.39 lakh smart cards had been distributed covering more than 16.97 lakh people. So far, 1,458 people have availed themselves of benefits under the scheme. The Cabinet Committee on Economic Affairs also gave its approval for continuation of the ongoing Integrated Child Development Services scheme during the XI Five-Year Plan period within the total allocation of Rs.44,400 crore. With this, the total number of anganwadi centres will also increase to 14 lakh.
Regarding the provision of serving hot cooked meals in all anganwadi centres, the government has decided to constitute a Group of Ministers which will give its recommendations after consultations with the State governments.
The RSBY was launched on October 1 last year for the BPL population in the unorganised sector. The scheme is being implemented by the State governments through insurance companies by inviting bids from both public and private companies. Almost all States have agreed to implement the scheme during the current year with Haryana, Punjab, Delhi, Gujarat, Bihar, Jharkhand and Tamil Nadu already starting enrolment and issuing smart cards. As many as 12 States have initiated the process and the remaining are likely to start implementation soon.
Until September 23, more than 3.39 lakh smart cards had been distributed covering more than 16.97 lakh people. So far, 1,458 people have availed themselves of benefits under the scheme. The Cabinet Committee on Economic Affairs also gave its approval for continuation of the ongoing Integrated Child Development Services scheme during the XI Five-Year Plan period within the total allocation of Rs.44,400 crore. With this, the total number of anganwadi centres will also increase to 14 lakh.
Regarding the provision of serving hot cooked meals in all anganwadi centres, the government has decided to constitute a Group of Ministers which will give its recommendations after consultations with the State governments.
Source: The Hindu
CABINET DEFERS DECISION ON FDI CAP IN INSURANCE
New Delhi: The Union Cabinet deferred a decision on the much-awaited insurance law amendment Bill that aims to raise the foreign direct investment (FDI) cap for insurance companies from 26 per cent to 49 per cent. No decision was taken as Finance Minister P Chidambaram was not present at the meeting.
The Insurance Laws (Amendment) Bill is expected to be tabled in the coming Parliament session, which begins on Friday. The Bill also seeks to allow promoters to hold majority stakes in insurance companies and permit public sector general insurance companies to raise capital from the market to finance their expansion.
The reforms, planned by the government long back, were put on the back-burner due to the opposition by the Left parties, which were giving outside support to the UPA government. The Bill is likely to be taken up by the Cabinet soon.
Briefing the media, Sibal said the Cabinet Committee of Economic Affairs (CCEA) approved the creation of institutional infrastructure for hospitality and tourism education. The approval would entail strengthening of existing hotel management and food craft institutes and result in creation of 19 new hotel management centres and 25 food craft institutes during the 11th Plan period (2007-12).
The CCEA also approved an incentive bonus of Rs 50 per quintal on paddy, over and above the minimum support price (MSP), for the entire kharif marketing season. The decision will effectively increase the support price of paddy procured for the central pool to Rs 900 per quintal, and partially address the concerns of farmers’ organisations, which were demanding a hike in the MSP.
The Insurance Laws (Amendment) Bill is expected to be tabled in the coming Parliament session, which begins on Friday. The Bill also seeks to allow promoters to hold majority stakes in insurance companies and permit public sector general insurance companies to raise capital from the market to finance their expansion.
The reforms, planned by the government long back, were put on the back-burner due to the opposition by the Left parties, which were giving outside support to the UPA government. The Bill is likely to be taken up by the Cabinet soon.
Briefing the media, Sibal said the Cabinet Committee of Economic Affairs (CCEA) approved the creation of institutional infrastructure for hospitality and tourism education. The approval would entail strengthening of existing hotel management and food craft institutes and result in creation of 19 new hotel management centres and 25 food craft institutes during the 11th Plan period (2007-12).
The CCEA also approved an incentive bonus of Rs 50 per quintal on paddy, over and above the minimum support price (MSP), for the entire kharif marketing season. The decision will effectively increase the support price of paddy procured for the central pool to Rs 900 per quintal, and partially address the concerns of farmers’ organisations, which were demanding a hike in the MSP.
Source: Asian Age, Business Standard
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