Insurance policies to be available at post offices

Insurance policies to be available at post offices

Post offices can now distribute insurance products with IRDA, allowing each circle of the Department of Post (DOP) to act as a corporate agent of insurers.

"Each Circle of India post should be treated a separate unit in order to grant independent corporate agent licence with various insurers," insurance regulator IRDA said while granting permission to postal circles to distribute insurance products.

It, however, said that in the case of metropolitan areas, head of Circle may approach IRDA for prior approval of further division in the circle as separate units to obtain licence to act as corporate agent in view of the large population.

The DOP has divided the whole country into 22 postal circles for providing postal services.

The Insurance Regulatory and Development Authority (IRDA) allowed each circle to tie up with two non-life insurance companies, two life insurance companies, one agricultural insurance company and one stand alone Health Insurance Company for this purpose.

Corporate agents act as insurance agent for insurers and procure business on behalf of the insurance companies through its executives.

The sector watchdog had last month sought views from insurers for granting corporate agency licence to the DoP to promote financial inclusion.

An expert committee on 'Harnessing the India Post Network for Financial Inclusion' had earlier recommended that the low cost platform of India Post be used for strategic partners like microfinance institutions (MFIs), mutual funds and insurance companies.

It also suggested expanding the role of Post Office Savings Bank as an agent of Ministry of Finance to play a larger and direct role in financial inclusion.

However, IRDA has disallowed the head office of India Post to engage in the distribution of the insurance products.

"In its individual capacity the Head/Corporate Office of India Post shall not obtain license to act as Corporate Agent of any insurance company. The Head /Corporate Office of India Posts shall not engage in the distribution of insurance products of any insurance company registered with IRDA in any other capacity," it added.

Unethical Practices by Some Hospitals for Claiming Insurance

Unethical Practices by Some Hospitals for Claiming Insurance

Meena Kumari, at 25 years of age, had never expected that in her life she would have to undergo a surgery which would have a major impact on her life. Last year, she had consulted a Chennai based private hospital for irregular menstrual cycle. It was diagnosed by this private hospital as small fibroid in her uterus and subsequently underwent hysterectomy to get her uterus removed. As this individual was covered by the government employees’ health insurance scheme, a claim amounting to Rs 40,000/ - prepared by the hospital was sent to the insurance company for re-imbursement.

Upon further investigations by an expert panel comprising of doctors from an insurance company, this surgery has been deemed as unnecessary and unjustified.

More than 30% of the hysterectomies done under the insurance scheme are unwarranted not only by the medical fraternity and across insurance companies but also by the senior medical practitioners. This has rendered several women as medically unfit to conceive, thereby complicating the social lives of such families and this classic example is strongly illustrative of violation of medical ethics.

An analytical study of the records available across insurance companies depict that under the government employees’ health scheme, approximately 540 ladies in the age group of 25-35, members exceeding 100 in the age range from 20-30 years, had undergone surgeries pertaining to either removal of uterus or ovaries.

V Jagannathan, Chairman of Star Health and Allied Insurance, has conducted numerous marathon meetings with hospitals, warning them against medical malpractices and quoted examples by citing numerous instances. For example, when one of the patients was contacted by the Insurance Company, the patient replied that she had agreed to undergo surgery just because she was informed that it could turn cancerous. In fact, surgery is not the only remedy for irregular menstrual cycle in women. It is not a necessity that many young women should have to undergo this ordeal. It can simply be treated by administration of medications to regularize their periods and added that further examination in such women revealed that there was absolutely no family history or any ailment pertaining to their reproductive system. Just recently, two private hospitals in Nagercoil and Kanyakumari were “blacklisted” in connection with exorbitant expenses from the beneficiaries of the Kalaignar health insurance scheme implemented by the government of Tamil Nadu, India.
Source: medindia

Irda tells postal dept to fall in line, triggers row

Irda tells postal dept to fall in line, triggers row

India's top insurance regulator has demanded that the country’s postal department adhere to its norms while selling insurance products, triggering a potentially damaging row between the two and forcing the finance ministry’s intervention.

The Insurance Regulatory Development Authority (IRDA), which regulates all insurance products in the country, has threatened to ban all policies sold by the Department of Posts (DoP) in case of a failure to comply.

A rattled finance ministry, which is already locked in a high-profile mediation effort to resolve a row between the IRDA and Securities and Exchange Board of India (SEBI) over unit linked insurance policies (ULIPS), was forced to step in asking for restraint and the matter is now being discussed between the three.

“....We are working to find an amicable solution on how both IRDA and the Postal Department can solve this issue. Any final decision will be taken only after giving due consideration to benefit of existing policy holders,” a finance ministry official said.

The postal life insurance has over 15 million policy holders. It offers two life insurance schemes, Postal Life Insurance and Rural Postal life Insurance with a corpus fund of Rs 14,000 crore and Rs 4,000 crore, respectively as on March 2009. All insurance products offered by the DoP are not covered by IRDA’s rules and regulations.

The current one and the bigger battle between IRDA and SEBI highlight the importance of clear rules of demarcation between various regulators and government bodies in a sector whose growth has assumed gigantic proportions.

The insurance regulator argued that compliance with IRDA’s norms will actually benefit the department of post. “In fact they (department of post) have lost a number of times to get group insurance schemes from public sector players such as BSNL in the past,” said an IRDA official stating the case for expedition of decision on investment of the corpus under Post Office Insurance Fund as per IRDA guidelines.

Under the Insurance Act 1938, Section 118 (C), life insurance schemes run by several state governments for their employees and the Postal Life Insurance Scheme of the central government don’t come under the IRDA purview. The insurance regulator is looking to extend its reach. “IRDA has asked us to form a separate insurance division. They further want us to follow their norms regarding requirement for capital and deposits. Given our huge base, it doesn’t make sense unless some relaxation is provided for,” said an official in the ministry of Communications and IT.

As per a report from Comptroller and Auditor General of India (CAG), the department of post failed to achieve the yearly target set for procurement of business both in Postal Life Insurance (PLI) and Rural Life Insurance during 2002-03 and 2006-07. It states that in case of PLI, the shortfall in target went up from 17% in 2002-03 to 41% in 2006-07.
Source: Economic Times

LIFE COVER OF Rs 1 CRORE FOR JUST Rs.15000

There is a quiet rate war raging among insurers that has brought down the cost of Rs 1 crore cover to Rs 15,000 from over Rs 50,000 per annum a decade ago. A big chunk of the reduction has happened in recent months. Without much publicity life insurance companies have drastically reduced premium rates on high-value term insurance policies of Rs 1cr and above.

As against a premium of over Rs 50,000 for a Rs 1 cr cover for a 30-year old woman charged by Life Insurance Corporation a decade ago, private life insurer Birla Sun Life are offering a similar cover for an annual premium of around Rs 15,000.

Other private life insurers, such as ICICI Prudential life and HDFC Standard Life, have also reduced their term insurance rates. The term rates for LIC policies, too, have come down drastically as compared to 10 years ago.

Today, one can avail of a LIC term policy with a sum assured of Rs 1cr for an annual premium of nearly Rs 25,700-32 ,000. But unlike LIC whose rates are available to most buyers, Birla Sun Life has stringent underwriting norms and the rates are available to only those in the best of health.

Term insurance is a cover where the only benefit is a payment if the insured dies during the term of the policy is the most basic form of life insurance. The cover is now almost a commodity with web-based aggregators offering quotes from all insurance for term protection.

ICICI Prudential Life appointed actuary Avijit Chatterjee said the decline can be attributed to better mortality experience in the recent past.

This is another factor, industry-watchers feel, that has worked in favour of the rich. Since such policyholders have access to quality healthcare and lead a relatively superior lifestyle, their life expectancy is high, and this translates into lower rates.

“Term insurance premium rates have started seeing a downward trend since the last three years. Over the last couple of years, they have dropped by nearly 30%," said Rahul Aggarwal, CEO, Optima Insurance Brokers. One of the reasons for this, he explained, is the increasing demand, mainly from the high net worth segment, which has inflated the volumes. "Increasing volumes are driving the rates down and lower rates, in turn, are stimulating the demand for term insurance," he added

"Over the last six months, some insurers have reduced the term insurance rates. The price reduction is limited mainly to high value policies targeted at the HNI segment, that is, people earning over Rs 1 lakh per month, who seek policies entailing a sum assured of more than Rs 25 lakh," said a senior executive with a private life insurance company.

HDFC Standard Life Insurance, for instance, has reduced the premium rates of its term plan by around 25% across different premium and age bands.
source: The Economic Times

Pay your insurance premium at Post Offices ...

INDIA POST TIE-UP WITH ICICI PRUDENTIAL
POSTAL GOLD COINS GO TO HARYANA AND UTTAR PRADESH NEXT WEEK

In yet another move to expand its basket of services, India Post has done a tie-up with ICICI Prudential for collection of insurance premium through Post Offices. The service is now available at more than 200 Post offices in Gujarat, Punjab, Andhra Pradesh, Kerala and Maharashtra Postal Circles. Their will be no additional cost involved for the customer.
The premium amount realized will be sent to ICICI Prudential through ePayment system of India Post. The tie-up with ICICI Prudential is a step in the direction to make the Post office a one stop shop for the community. Now, the customers will have the convenience to pay their insurance premium at their neighborhood Post office.
This tie-up is expected to bring the customers closer to Post office. In the service category, insurance is one of the fastest growing industries with a very high potential. The highly popular sale of gold coins by India Post is being opened in Uttar Pradesh & Haryana Postal Circles from next week. The service was taken to post offices in Kerala earlier this week. With this, select Post offices from 14 Postal circles will provide this service to the public. Department of Posts began selling 24 carat ‘Gold Coins’ at 102 Post offices in Delhi, Maharashtra, Gujarat and Tamil Nadu from 15th October. Later, the service was extended to Punjab, Andhra Pradesh, Karnataka, Madhya Pradesh, West Bengal and Rajasthan.
Apart from enhancing the revenue of the Department, this has enabled India Post to usher in a new image of India Post as a modern and relevant organization in all areas of life. Gold is the latest addition to a range of retail activity that India Post has already taken up.
India Post has been selling various products under Retail Post category and there is sustained growth in the revenue from these activities. Post Office sells UPSC applications and university applications, it retails Darjeeling Tea in West Bengal, it markets Aloe Vera products in Gujarat and it takes orders for distribution of Prasadams of various temples in Andhra Pradesh and Kerala.

6th CPC recommends withdrawal of Risk Allowance

6th CPC recommends withdrawal of Risk Allowance All categories of jobs that involve inherent element of risk with deleterious effect on health over a period of time should instead be provided with free medical and life insurance of
Rs.5 lakhs for employees in PB-1 pay band ;
Rs.7 lakhs for employees in PB-2 pay band;
Rs.10 lakhs for employees in PB-3 pay band / higher pay bands / scales.

To offset the effect of inflation, amount of the insurance should automatically be increased by 50% every time the DA payable on the revised pay goes up by 50%. The entire expenditure on paying premium for this insurance will be borne by the Govt.

The amount insured will be paid in case of any serious injury or death sustained in the course of employment and will be over and above the others benefits with mandatory health check-ups every quarter and enhanced leave, wherever the same is necessary for proper recuperation. Further, the Govt. should ensure that latest technology and greatest level of care is observed in these jobs so that the element of risk involved therein is minimized.

http://90paisa.blogspot.com/2008/11/as-on-rates-of-da-1.html