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New micro-insurance norms soon

5th Feb, 2015

The sum assured for micro-insurance products may rise to upto Rs 2 lakh to ensure more banking correspondents and distributors sell such products.

Earlier in 2014, Insurance Regulatory and Development Authority of India(Irdai) had brought out a revised draft on the micro-insurance products.

The regulator had said that partial withdrawals may be permitted from the second policy year onwards, subject to ensuring minimum balance equivalent to one annual premium in the policy account.

Final guidelines are expected to be announced in the next few weeks.

Micro-insurance products, which offer coverage to low income households, are a mechanism to penetrate rural areas. It is a general or life insurance policy with a sum assured of Rs 50,000 or less.

In a communication to the regulator and ministry officials, insurers had sought better remuneration for distributors of micro-insurance including banking correspondents so that more institutions are incentivised to sell such products.

"With a higher ticket-size of Rs 1 lakh or above, distributors can earn higher commissions from the products that they sell," said a senior life insurance executive.

Irdai has said that regional rural banks, micro-finance institutions, district cooperative banks, non-governmental organisations, self-help groups, urban cooperative banks, banking correspondents and individual owners of kirana stores, public call offices, petrol bunks and fair-price shops in rural areas will be allowed to sell these products.

Source : Business Standard

Demystifying health insurance: Max Bupa kicks off customer education initiative

4th Feb, 2015

Max Bupa has kicked off 'All Fact no Myth', a first of its kind customer education initiative, aimed at demystifying health insurance and educating customers about its benefits. The six week-long integrated campaign comprises of a series of engaging and interactive customer outreach activities across the digital, social, radio and print platform. It is expected to drive customer awareness leading to higher adoption of health insurance amongst customers.

The campaign is timed for the last quarter of the fiscal year since the period is marked by a spike in insurance buying. It is aimed at helping consumers make informed choices about their families' health. The campaign will drive category awareness as well as outline Max Bupa's competitive edge in terms of its innovative product offering and exemplar customer service delivery. These include Max Bupa's promise to fulfil all cashless claims within 30 minutes making it the first health insurer in the country to do so, coverage for 19 relationships under a single policy and international treatment for 9 critical illnesses amongst others.

With the number of people visiting social medium platforms for information rapidly increasing, the initiative has been rolled out on multiple digital platforms like Facebook, Twitter and Instagram. The digital campaign introduces two virtual characters, Satya and Mythya driving conversations around health insurance, which de-mystify the common misconceptions about the category. While Mythya propagates common myths prevalent about the category, Satya helps bust them to guide the customer in the right direction. The conversations are in the form of interesting videos, comic strips. and print platforms.

Anika Agarwal, Head-Marketing, Max Bupa said, "As health partners for our customers, our aim is to further aid the accessibility of quality healthcare and enable them to lead healthier and more successful lives. In light of the current medical inflation, this will become a reality only when they avail health Insurance. Considering the abysmal level of health insurance in the country, we recognised the need for a consumer education drive to enable people overcome their lack of involvement and negative disposition about health insurance. The 'All Fact No Myth' initiative has been designed to create a greater understanding and acceptance of health insurance amongst consumers across all groups. "

Source : The Financial Express

Service tax on insurance policies likely to pinch policy holders

29th Jan, 2015

CHENNAI/COIMBATORE: Be prepared to shell out service tax for traditional life insurance policies and see a reduction in designated units on unit-linked insurance plans (ULIPs) offered by private insurers.

For instance, the PLI (Postal Life Insurance) directorate of India Post has decided to collect the service tax on insurance premium from all PLI and rural PLI policy holders with effect from January 1.

The service tax works out to 3.09% (including education and higher education cess) of the gross premium during the first year and 1.545% (including education and higher education cess) from the second year. It is being collected from the policy holders separately and a consolidated receipt is being issued for the total amount i.e. premium plus service tax.

But officials from India Post, Chennai city region state the additional imposition of service tax won't have much impact on their overall business. "The additional 3% (service tax) on premium is a very minuscule amount. In any case, the bulk of our PLI (postal life insurance schemes) are on auto debit mode and now the service tax would also be debited in addition to premium," post master general, Chennai city region, Mervin Alexander said.

The Chennai city region of India Post currently has 3.16 PLI policies and 6.57 lakh RPLI policies in force. The average policy size in RPLI ranges from Rs. 50000 to Rs. 1 lakh in the region while in the case of PLI the average size was Rs. 5 lakh in Chennai city region.

The service tax has been expanded to cover a whole host of charges including policy administration and allocation charges, mortality charge and fund management charges on ULIPs by some private insurers recently.

Though the service tax will not impact the annual premium amount, it will result in lower units for ULIPs. "The tax will be adjusted by deducting the equivalent units from your account or by levying the same on the investment fund held by and on your behalf, as may be decided by the company from time-to-time," Aegon Religare said in its letter to a ULIP policyholder.

"We could not effect service tax on unit-linked plan charges in our plans after the union budget announcement a couple of years back. That was because our systems were not compliant to capture this earlier," chief distribution officer of Aegon Religare Amit Kumar Roy said.

Source : The Times Of India

United India Insurance eyeing Rs 400 cr premium income in UP

21st Jan, 2015

Public sector general insurance company United India Insurance is targetting over 17% growth in premium income in Uttar Pradesh during 2014-15 financial year.

The company is eyeing total premium income of Rs 400 crore in this fiscal compared to Rs 340 crore last year.

Talking to media here, company's CMD Milind Kharat said pan-India United India Insurance was aiming at premium income of Rs 11,000 crore, up from about Rs 9,700 crore last fiscal.

"Against the domestic general insurance industry growth of 8%, we are growing at 11%," he claimed.

He further informed about the recruitment plan of 1,000 personnel to man the different offices in India.

There are 28 general insurance companies operating in India, of which 4 are public sector enterprises, who collectively account for 56% of the total business.

He observed the insurance sector would witness greater competition in the market with the lifting of foreign equity ceiling from 26% to 49%. "More competition would mean even better customer service and products."

Source : Business Standard

CM Siddaramaiah launches health insurance schemes

20th Jan, 2015

Bengaluru, Jan 20: Karnataka Chief Minister Siddaramaiah launched two health insurance schemes -Rajiv Arogya Bhagya for above poverty line (APL) households and Jyothi Sanjeevini for all government employees – in Bengaluru on Tuesday.

Siddaramiaiah said government employees will get cashless treatment in 124 empanelled private hospitals under Jyothi Sanjeevini scheme without any cap while APL families will get subsidised treatment under Rajiv Arogya Bhagya (RAB) up to Rs 1.5 lakh in 110 empanelled hospitals.

Both the health insurance schemes will commence from January 20.

Under RAB for APL families, there are differential rates for general, semi-private and private wards.

While the beneficiaries opting for treatment in general wards get 70 per cent of the cost, those choosing semi-private and private wards will get reimbursements up to 50 per cent of the cost.

Implementation of the Rajiv Arogya Bhagya scheme also means every citizen, irrespective of income and even those not covered by any health insurance scheme will be eligible for low-cost surgeries.

These schemes would cover ailments related to heart, neurology, kidney, cancer, burns and accident besides children affected by serious diseases.

As many as 449 serious types of surgeries related to these seven ailments have been identified.

Those who wish to make use of the schemes should enrol themselves at the Arogya Suraksha Trust.

The Rajiv health scheme is aimed at providing help to APL card holders and their family members, who are facing serious health problems.

There are plans to provide advanced healthcare at the government super speciality hospitals, which would be on cash payment basis.

The Trust has tied up with 124 hospitals for implementing the scheme.

Medical care to the tune of Rs 1.5 lakh could be availed annually by an APL family.

The Chief Minister said the treatment under the Rajiv health scheme is not totally free. They will have to pay a minimum fee.

If a patient is admitted to a general ward, 30 per cent of the total medical cost has to be paid by the patient and the rest 70 per cent would be met by the Arogya Suraksha Trust.

In super speciality wards, 50 per cent of the cost would be met by the Trust, he said.

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