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G Srinivasan appointed director of National Insurance Academy
Dec 03, 2018
Mr G Srinivasan, former chairman-cum-managing director of New India Assurance Company, India's largest general insurer, has been appointed the director of the National Insurance Academy (NIA) at Pune.
Mr Srinivasan’s appointment will be for a period of three years or until he attains the age of 65, whichever is earlier from the date of taking charge at his post.
Mr Sushobhan Sarker, the previous director of NIA had completed his tenure on 31 October this year. Mr Srinivasan superannuated from the post of chairman-cum-managing director of New India Assurance in July 2018.
NIA is a premier insurance academic institute sponsored by the Indian public sector insurance industry. Besides running the two-year flagship post-graduate diploma in insurance, it also conducts a variety of short duration courses in insurance for the Indian insurance industry.
A chartered accountant and fellow of the Insurance Institute of India, Mr Srinivasan has won many accolades from various organisations in the market. An active practitioner and lobbyist for the industry good, he served in many government committees in India as well as in the IRDAI during his career with the public sector general insurance industry in India.
Mr Srinivasan was also the winner of the Personality of the Year award at the 2016 Asia Insurance Industry Awards. He was also instrumental in successfully guiding in November 2017 the IPO of New India.
It is perhaps befitting that Mr Srinivasan with his impeccable career and over three decades of experience in insurance, would now guide the young insurance talent that would steer the Indian insurance industry in the years to come.
Mr Srinivasan has always been active in drawing the “intelligent, confident tech-savvy: genY” into the insurance business. And to those in the business, he urges them to “keep constantly up to date”.
He cherishes the challenges and joy of meeting a variety of people, understanding so many businesses, coming to the assistance of people when they are in need and helping many to rebuild their lives when the chips are down.
NIA was established in 1980 jointly by the Ministry of Finance, Life Insurance Corporation of India, General Insurance Corporation of India, The New India Assurance, National Insurance, United India Insurance and Oriental Insurance.
Source : Asia Insurance Review
Life insurance to be cheaper while health insurance becomes more expensive
Nov 30, 2018
Buying life insurance is likely to get more affordable, while health insurance could get dearer. Improved life expectancy among the insured population will keep the cost of life cover down, but the cost of health covers is expected to move up because of various court directives asking insurers to cut out exclusions.
Mr Sanket Kawatkar, head of life insurance at actuarial consulting firm Milliman, said that there is an improvement of around 10% in the new mortality table, which is prepared by the Institutes of Actuaries of India, according to a report in Times of India.
According to Mr Kawatkar, insurers may choose not to reflect the new tables because life insurance premiums are already the lowest in the region.
Global reinsurers are bullish on India as it is seen as the market with the highest latent demand. “The protection gap in India is estimated at $9trn, making it one of the biggest markets in terms of potential,” said Mr Kawatkar, consulting actuary with Milliman.
Health insurance is expected to see an increase in rates. According to Mr Lalit Baveja, senior health management consultant at Milliman, the scope of health insurance in India is set to increase due to court interventions for covering hitherto excluded illnesses like HIV, mental ailments and congenital defects.
“Insurance companies will have to rework all their existing products to address these exclusions and file them with the insurance regulator with revised pricing,” said Mr Baveja.
Source : Asia Insurance Review
SBI General Insurance targets public listing in 2020
Nov 28, 2018
SBI General Insurance plans to launch an initial public offer (IPO) in 2020, the company's deputy CEO has said.
Ms Lisa Jeffrey told the Indo-Asian News Service that the insurer, which is a joint venture between State Bank of India (SBI) and Insurance Australia Group (IAG), aims to be among the top five non-life insurers in India by investing in technology and launching new products. The company also plans to boost the number of agents and other distribution channels, and focus on health insurance policies.
"We are investing in digital technology and looking at digital strategy. Now there are insurers that are purely into digital technology. The investment is part of our overall budget for information technology," Ms Jeffery said.
At a time when the industry is registering a 12% growth, SBI General Insurance is clocking about 30% business growth.
"We hope to log about 35% growth in our gross domestic premium income (GDPI),” she said, adding that during the first half of the current fiscal year which ends on 31 March, the GDPI growth was about 30% at INR2,067 crore ($292m) and the net profit was INR270 crore. She said SBI General Insurance was one of the few players to have posted an underwriting profit.
Ms Jeffery said that IAG International was not planning to increase its stake in the company from the current 26% to the maximum permissible 49%. This overturns a stock exchange statement by SBI in 2015 that IAG would raise its stake to 49%.
In September, SBI sold a 4% stake in SBI General Insurance at INR482 crore, in what was seen as a price discovery exercise. The sale valued the company at about INR12,000 crore. After the deal, SBI holds a 70% stake in the venture.
Source : Asia Insurance Review
Centre eases insurance claim rules for farmers
Nov 27, 2018
The Union government has introduced several norms tightening the Pradhan Mantri Fasal Bima Yojana (PMFBY), its flagship farm insurance scheme. One of the new rules taking effect on November 30, reviewed by Hindustan Times, says that claims of farmers not cleared by insurance firms within two months of harvest will be “automatically approved”.
As with any insurance policy, claims need to be approved by insurance firms for policyholders to get compensation.
The new rule means insurance firms will not be able to verify claims or carry out further checks to ascertain the validity of claims of farmers if they don’t do it within two months.
“Beyond the two-month deadline, all claims will be auto approved by the PMFBY portal (website),” an official said, requesting anonymity.
With this new “auto approval” guideline, the government hopes to deal with what a major reason of farmer angst concerning the scheme: delayed payments.
If farmers don’t get insurance payouts for one season in time, it affects their ability to invest in crops for the next season.
A centralized website governing the farm-insurance programme has been updated with an in-built feature to make this “auto approval feature” operational.
Among key changes to the politically important scheme, participating insurance companies will now have to spend 0.5% of the gross premium collected on raising “awareness about the scheme among farmers”.
State governments will have to devote 2% of their annual budget to a slew of measures tied to the farm insurance programme.
These include administrative expenses to speed up processing of claims. This 2% share will also go towards meeting expenses for yield and loss assessment, crucial for timely payouts.
The 2% share from the budget will also be used for purchase of smart phones through which yield losses need to be estimated via an android app developed for the purpose. Other expenses include setting up of state technical support teams.
According to Ashok Gulati, an economist with the think-tank ICRIER, if the Pradhan Mantri Fasal Bima Yojana scheme is to achieve its most critical goal — timely payouts to farmers — it can’t fly without a raft of highend technological fixes, from drones to even a new constellation of satellites for accurate crop damage assessments.
In an earlier round of changes, the government had decided to slap a 12% interest on insurance firms (to be paid to farmers) for delay of more than 2 months in claim settlement.
Moreover, a 12% interest must be paid by states too for delay of more than 3 months in releasing their state of subsidy. Under the Pradhan Mantri Fasal Bima Yojana, farmers have to pay between 1-2% of the total premium. The rest is shared between the Centre and states equally.
Source: Financial Express
Remembering 26/11: Insurance claims of Rs 376 crore settled after Mumbai attacks
Nov 26, 2018
Insurance claims of over Rs 376 crore was settled after the Mumbai attacks in 2008. The fund that covered most of the claims was the Indian Market Terrorism Risk Insurance Pool (IMTRIP) which was formed in the wake of the September 11 attacks on the World Trade Centre in the US in 2001.
The losses of up to $10 billion in the 9/11 attacks had forced the global insurance industry to rethink and develop a new strategy for terror cases . Before the WTC attacks, terrorism risk was included in "all-risk" insurance policies at no added cost.
After WTC attacks, terrorism risk cover was withdrawn from insurance policies. Existing policies were cancelled and new insurance policies were issued, excluding terrorism cover. Now, terrorism coverage is generally offered separately at a price.
In India, the IMRTRIP covered the affected locations in the Mumbai attack. IMTRIP has a growing corpus stacked up during the course of more than 15 years and adequate resources available to meet liability arising out of any unfortunate incident. Combined with a decline in claims ratio, risk pools such as IMTRIP have a comfortable premium reservoir.
Just like other countries, terrorism cover is an optional add-on cover in India too. It provides cover to individuals and businesses for potential losses due to acts of terror. The premium charged varies as per the risk occupancy and sum insured. Mid-term inclusion of terrorism is also not allowed.
Most corporates are opting for terror cover for their employees and buildings. Plants owned by nearly all top corporates are covered. Large energy companies such as ONGC have diffrent types of insurance and terrorism insurance. Some of the large infrastructure projects such as Metro projects, ports, airports and flyovers have also started taking terror insurance cover.
Source: Business Today
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