SBI Life to leverage bank network also raising the no of agents

SBI Life is setting up to raise its operations in the rural and semi-urban areas by improved utilization of SBI branch network and raising the number of advisor.

SBI Life said that they want to make a important difference in our rural reach by doubling the number of agents by 2008-09 and fuller-utilization of SBI branch network in rural areas.

SBI has more than 7,000 branches in the country. More than 50 pct of these are located in rural and semi-urban areas. Though SBI's products are being sold in these branches, there is a lot of scope for further business.

BI Life would launch a health product in the first quarter of the next fiscal and implement direct payment of premium through core banking network.

SBI life has implemented a pilot micro insurance project, Grameenn Shakti, in Bhubaneswar for Self Help Groups (SHGs) in December, 2007 and provided life cover to 2.5 lakh women.

Source: insuremagic

Corporates pruning health insurance cover for staff

Mumbai: Many corporates, particularly top IT companies and BPOs, are pruning the health insurance coverage for their staff, following sharp increase in premium rates. Some corporates have even taken away parents of employees from their group insurance scheme, restricting the benefit only to the staff.

IT companies, which have traditionally offered substantial health covers for their staff as a human resource incentive, are now choosing to cut costs either by introducing a co-payment structure (where an employee has to partly bear the cost) or by doing away with the cover altogether, they said.

“IT companies are reacting to the twin but unrelated threats of business recession and increase in health insurance premium rates by tweaking benefits and coverage. BPOs, for instance, where traditionally attrition has been high, are cutting down on coverage for parents,” said Mr V.G. Dhanasekaran, Vice-President and Regional Head – South, India Insure Risk Management & Insurance Broking Services P Ltd. India Insure handles several group health insurance accounts.

“Some have either reduced the overall limits or brought in sub-limits within the overall floater limit for parents. Co-payment has been introduced in several policies,” he said.

The insurance restrictions come in the wake of high claims from parents.

“The overall claims ratio in the corporate group health portfolio is high — up to 150 per cent. Around 60 per cent of the claims in this segment come from parents of employees. So, the cover is either being spun out of the scope of coverage or co-payment has been put in,” said Mr Girish Rao, Managing Director, Swiss Re Healthcare Services.

“Covers for employees have also been restricted. So, junior employees may have access only to twin sharing rooms in hospitals, employees in the middle rung may be given a single room and senior officials may have air conditioned rooms, he added.

Owing to their high staff strength, IT, ITeS and BPO companies are the biggest buyers of group policies, followed by other services companies, manufacturers and media houses.

Since the beginning of the free pricing regime, insurance companies have raised rates on their group health policies since they no longer require to cross-subsidise it against the more profitable corporate property insurance policies.

In the last 6 months, premium rates have gone up by 25-40 per cent on group health covers but the claims still far outweigh the premium. Insurers still want to have big corporate names as their clients, even at a cost.

An insurer accepted renewal of the health cover by a leading IT company for Rs 25 crore in spite of it suffering claims of around Rs 35 crore in the previous year.

Likewise, a leading BPO which had reported claims of over Rs 9 crore in the previous year, renewed its policy for just Rs 6 crore.

Some experts argue that the individual customers are paying higher premium and end up subsidising for the corporates.

“While premium for individuals has gone by an average of 10-50 per cent, the increase has not been in the same proportion for corporates,” said Dr Sandeep Dadia, Director, Enam Insurance Brokers.

The health insurance market currently stands at Rs 4,000 crore in terms of premium of which 40 per cent comes from corporate health insurance.

Source: Business Line

FILM INSURANCE IS A HIT AGAIN

Film insurance seems to be gradually returning to Bollywood, after a lull. This weekend’s two big releases, Harry Baweja’s Love Story 2050, co-produced by Adlabs, and Aamir Khan’s latest production Jaane Tu..Ya Jaane Na with PVR, have both had insurers.

While state owned non-life insurer United India Insurance has insured Baweja’s film, Khan’s film has been insured by private insurer Bajaj Allianz General Insurance.

Without disclosing the premium for Jaane Tu.., an Bajaj Allianz official told FE on condition of anonymity that, among other things, shooting equipment and the film sets had been insured for the film. However, the insurers are not concerned with the performance of the film at the box office.

The trend of film insurance begun in the late nineties with Subhash Ghai’s Taal and continued with Sanjay Leela Bhansali’s Black.

But despite the initial hype, film insurance has still to gather momentum in the Hindi film industry, despite insurers seeking to make inroads. Broadly, only one out of every 10 films being produced opts for insurance.

Sources say the main obstacle lies in the nature of insuring a particular film. While writing a film insurance policy, the insurers usually cover things like reimbursement of expenses incurred by the producer due to the death of principal stars, loss or damage to sets, wardrobes, costumes machinery, equipment owned and destroyed due to fire and other perils, as well as theft.

Meanwhile, both the films Love Story 2050 and Jane Tu.. which were released on Friday, are being keenly watched by the film trade and exhibition circles.

source: The Financial Express

INVESTORS' LOVE FOR ULIPS CONTINUES

New Delhi: The current bearish trend at the stock market has not affected the appetite of investors for the Unit Linked Insurance Plans (ULIPs), which has continued to grow with 70 to 90% of new investors preferring insurance plans with option for investment in equity.

"ULIP-linked products continue to be dominant though the market has not performed well in the last few months," Bhargav Dasgupta of ICICI Prudential said. About 70-90% of new customers are opting for ULIPs with investment in equity, a senior official of the Aviva Life Insurance said. ULIPs are fundamentally mutual fund schemes with an insurance component and gives investors option to switch from debt to equity or vice versa, without paying any fee.

Private life insurance industry, Dasgupta said, was expected to record a growth of 40% current fiscal. Insurance being a long-term investment proposition, customers find it more lucrative, which gives a higher return than the rate of price increase, said Max New York Life official, adding "ULIP products also provide flexibility to customers as they have the choice of switching from one fund to the other without paying any additional fee." Investors, he added, are comfortable with ULIP products as they believe that the fundamentals of the Indian economy are strong, the recent turbulence in the bourses notwithstanding.

Some insurance companies are offering products with capital guarantee to maintain confidence of customers, the official said. The BSE Sensex is on a downslide having slipped below the 13,000-mark in the first week of July from a high of 20,000 recorded in October 2007.

Source: PTI, Times of India

'INTEREST IN ULIPS CONTINUES TO BE POSITIVE': KSHITIJ JAIN, MD& CEO, ING VYSYA LIFE INSURANCE

There have been a spate of financial products available for the investing community at the moment, and there will be more on offer in times to come. And, there will be many more service providers. ING Vysya Life Insurance, one of the service providers, has been expanding rapidly. Kshitij Jain, MD& CEO of ING Vysya Life Insurance took some time out to answer some snappy queries posed by Akash Joshi of The Financial Express.

Excerpts:
How would you differentiate between your products and that of the competition?

Our products are customer-centric and offer excellent value. The products are easily customisable for premium paying terms (single, limited and regular), simple and easy to understand.

How would you rate your performance in the Indian market?

We have been growing at over 60%, and have 1.2% market share in individual new business premium. Last year, we undertook a major expansion, and ING Life has established its footprint in 231 cities. We have over 7,00,000 customers and over 50,000 advisors selling our products across the country. We aim to grow at a minimum of double the market growth.

Do you see any changes in customer/investor preference for insurance products in the market?

Interest in ULIP continues to be positive, and customers want to participate in the upside of the market. People are becoming more aware of insurance products and are investing more time in financial planning, which is a positive trend. Customers are beginning to plan their financials at a younger age. In the recent past, we have also noticed an increase in retirement products.

What is the strategy your organisation is employing to battle these uncertain times? What is the investing approach you would employ?

Our approach has been simple –Life insurance is for the long term. Short-term cyclical instabilities should not be a cause of concern. Investment in life insurance should be made with a long-term perspective and not short-term gains.

What are the key sectors you would be looking at right now?

We would continue to focus on pension and long-term savings segments. The two sectors have shown immense potential and we are confident that this will only continue to grow in the future.

What would your wish-list for regulatory change be?

That's a good question. The industry is looking forward to an increase in FDI cap to 49%. This will bring in the required capital to grow the market. Life Insurance companies should also be allowed a longer period for availing a set-off of carry forward of losses, as it has a longer gestation period.

What are your current plans and offerings in the Indian market?

ING Life has a large product portfolio to suit the needs for every life-stage of our customers. We have 11 traditional and 9 ULIP plans. Our products offer solutions for protection, savings, retirement, and investments.

Some recent products that were launched were two new protection plans – ING Term Life and ING Term Life Plus and a retirement plan on ULIP platform, called the ING Golden Life.

Source: The Financial Express