Jeevan Nischay Policy is to be launched by LIC
Recently, Life Insurance Corporation announced to launch Jeevan Nischay policy. It will be single premium granted plan of LIC. Jeevan Nischay policy will be very similar to Jeevan Aastha which was launched last year.
Still, the whole information has not taken place among us but LIC will declare more information about the policy soon. According to the insider’s information, an insurer would have to invest of Rs. 1 lakh for 10 years then he will get a maturity about Rs. 1.7 lakh.
Yield and additional loyalty will be declared soon after the launch of the policy. Jeevan Nischay policy will be sold for limited period till March, 2010.
Jeevan Nischay policy introduces maximum features such as single premium plan and the investment will be linked with to the extent of protection the individual already has purchased.
The ET has written, “According to sources, the main objective of the policy is to tap the maturity benefits offered under an older plan – Bima Gold, which sold more than 1 crore policies when it was launched. Jeevan Aashta had mobilised close to Rs 10,000 crore, as it offered a safe haven of guaranteed returns amidst the turmoil in the market.”
Jeevan Nischay policy will cover “the mandatory five times of the premium amount for the first year of insurance. For subsequent years, the sum insured will be equivalent to the premium paid.” The news was also published in Economic Times.
Till now, one time premium policy has proved its essence. Earlier, we have seen many single premium policies by LIC and Reliance that had gotten good popularity. Now, we can assume about Jeevan Nischay policy and about its effect.
Single premium policy gives insurer independency also. Jeevan Nischay policy will be just like an investment for 10 years with insurance cover that will surly attract customers.
VISSS of IRDA and Subh Nivesh of SBI Life Insurance
There is the biggest news in insurance department of India related to VISSS and Subh Nivesh. VISSS is Vehicle Insurance Status SMS System and Subh Nivesh is a type of life insurance plan of SBI.
Currently, IRDA is working on VISSS project to create a large database about motor policy information by all insurance companies. This is a type of technology which will enable simple SMS query to ascertain whether a vehicle is insured or not. VISSS would provide an additional facility to police authority to verify insurance status of the vehicle.
So, VISSS will be an SMS technological system of IRDA where all vehicle information will be available from all insurance companies whether a motor insured or not.
There is other the most popular news about SBI Subh Nivesh policy which has been recently introduced. Subh Nivesh of SBI is a traditional life insurance plan. Subh Nivesh plan has been designed to savings, protection and income needs of customers which will cover risk-averse profile.
M N Rao who is the Managing Director and Chief Executive Officer of SBI Life Insurance, said in press release,
“Strengthening our product suite, the introduction of Shubh Nivesh is a step towards presenting customers a range of solutions which enables them to choose one that best suits their risk profile and financial needs. The product is available in two options. In endowment assurance option, the accrued bonus and the sum assured amount is payable during an unfortunate event of death during the endowment term or on survival at the end of term.”
So, the Subh Nivesh policy of SBI is not just very new, it is similar to JEEVAN ANAND policy of LIC. Subh Nivesh policy with endowment option will give a sum assured amount on an unfortunate event of death even after the completion of 100 years of age.
There is some very good attractive option with maturity payment options of Subh Nivesh of SBI life insurance.
TATA to Buy AIG in life insurance JV
There is the biggest news in insurance sector. TATA is to buy AIG in life insurance JV. Tata has planned to buy out AIG which is US insurer from the life JV, TATA AIG Life insurance. We have already published an analysis of life insurance industry in the comparison of AIG. According to our analysis AIG is facing crisis in the USA. About the loss of AIG we write in our previous post, banking and insurance sector loss,
“AIG’s loss amounts to 92 per cent of the $67.4 billion that Americans spent at world’s largest retailer Wal-Mart Stores Inc. in the fourth quarter, which includes the holiday season. It would take a person spending $1 million per day, everyday, the next 169 years to spend as much money as AIG lost during the fourth quarter, which lasted just 92 days.”
About the deal ET writes,
“Initially, there were indications that AIG would sell its Asian life insurance business. Earlier this year, US’ Metlife, UK’s Prudential and French insurer Axa had shown interest in buying parts of AIG’s life insurance business. But this could have caused regulatory problems in India, as all three multinationals have a presence here through JVs.”
It means not only TATA but also there are many insurance companies who are trying to take a chance to buy some share of AIG.
There is another thing which has made TATA to buy AIG that is global economic slowdown. These days AIG is suffered from huge loss in the USA. You should know that the USA government has bought maximum shares of AIG to get from crisis but still the insurance company facing more problems to survive globally.
Another thing which is also most important, US government has decided to sell shares by its Asian business under AIA. You should know that AIA is an arm of AIG, a public offer.
TATA spokesperson doesn’t want to comment at all on this situation, “We do not wish to comment on such speculation.” It is the truth that AIG was able to infuse money into the Indian life insurance JV despite of, crisis.
AIG plans to invest in non-life business also that could be strong position for that company. TATA is still in confusion to choose it’s a reliable partner.
M&A Guidelines Coming for Insurance Companies
Recently, IRDA (Insurance Regulatory and Development Authority announced that within two months M&A (Merger and Acquisitions) guidelines will be available for insurance companies.
J Hari Narayan who is the chairman of IRDA said to the reports of ET in a function which was organized by FICCI,
“It (guidelines) would be out soon. It is most likely to be finalized in the next couple of months. We have not taken any view we are examining it. We are examining the possibility.”
Currently, there is no any specific guideline for M&A in insurance sector over the country. Now, here are 22 life insurance firms and 21 non-life insurance companies in the country.
According to the Narayan, today non-life insurance products are taking large share. A data represents that more than 300 health insurance products have been offered by over 30 insurance companies which are both – general and life insurance.
Related to the insurance products there is big news which state that now car insurance will be comprehensive. Recently, the news came in light that if you want a motor insurance then you needn’t to go motor insurance companies because it will be now through any insurance companies.
The Economic Times published the news,
An official at the Insurance Regulatory and Development Authority (IRDA), while asking consumers to be more aware, says, “Dealers are neither agents, nor brokers’ insurers. What they quote is what they get from insurers. They can’t quote more or less than that.’’ Consumers should cross-check the price offered by various insurers, says the official. “Nobody should get carried away. No dealer can force you to get insurance.’’
Now, it is clear that in insurance sector a big change is going on. How much is effective the guidelines and car insurance feature, we will see in future. Still we are also looking some drastic changes in insurance products which may be useful for customers.
Guarantee Builder Launched by Bharti AXA Life
Private life insurance joint venture between Bharti Enterprises and AXA, Bharti AXA Life Insurance, launched an innovative premium guarantee product – Guarantee Builder.
Nitin Chopra who is the CEO of Bharti AXA Life said,
“This premium guarantee product addresses the needs of those traditional and new investors who are wary of market volatility – as is the case currently – but would still like to participate in the Indian growth story.”
Guarantee Builder would be a package for long-term customer to get benefit, as per the Chopra statement. Guarantee Builder will provide customers the benefit of increasing GMV (guaranteed maturity value). It is a first-of-its-kind benefit product to Indian customers.
Economic Times online news paper writes about the premium,
“GMV is the sum of the investment premiums payable over the term of the policy. Guarantee Builder provides customers the comfort of the GMV increasing by 1% each year till it reaches 115% of GMV at maturity.”
Guarantee Builder would be the new guarantee fund to Build & Protect. It will provide customers the option for the long-term to remain invested in equity up to 40%. It gives the flexible option to move out of the guarantee to switch out of Build & Protect Fund.
At the end of the 10th and 15th year a special addition of 2.5% of average policy fund value will be provided customers the benefit of wealth creation over the long-term. Guarantee Builder will provide death benefit of sum assured plus fund value. It would be with sum assured for ten times on the annual investment premium.
Latest news shows that Bharti AXA Life has also plan to invest Rs 100 crore into the life company in the July-September quarter.
Bharti AXA Life has many plan and investment option nearly to the new customers. The company is trying to invest almost all growing industries.
Life Insurance Industry Falling in Competition of General Insurance
According to the recent news, life insurance premium collection has fallen about 11.6% in the fourth quarter. In the financial year 2009 (April – March) has brought down about 6% according to the Insurance Regulatory and Development Authority (IRDA).
North-zonal Manager, Sanjay Kumar Jha from Bajaj Allianz said to the Economic Times, “The stock market crash in the previous fiscal led to a drop in the demand for unit-linked insurance plans, pulling down sale of new policies.” About the new premium collection ET says, “New premium collection clocked Rs 34,814.55 crore in Q4 against Rs 39,413.16 crore in the corresponding period of the previous fiscal. For the full fiscal, it stood at Rs 87,107.62 crore compared to Rs 92,988.71 crore in the previous fiscal.”
About the down it is said that the market leader LIC (Life Insurance Corporation) has gone more down about 10% whose market share was 60% to 63%. The collection has declined during the year which had been sold this year.
It is being said that LIC’s policy Jeevan Aastha premium collection would have been worse also.
Another news according to IRDA data shows that general insurance sector is in growth from 9% to 12.6%. Among the 16th non-life insurance companies only Reliance has posted negative growth in the sector.
In the other hand Birla Sun Life Insurance Rs 10,000 crore marks in Assets under Management (AUM). According to the Vikram Kotak who is the Chief Investment Officer said to the ET, “it gives us great pleasure to cross the landmark of Rs 10,000 crore of AUM and in the process registering a strong growth of 41 per cent year-on-year.”
On the analysis of Insurance sector we can say that the sector differ company to company not from policy to policy because in the one hand LIC is going down in life insurance where on the other hand BSLI is going up. Like it, in the general insurance policy all the insurance companies going up where Reliance is going down.
Renew your health insurance policies easily
Now, you can renew your health insurance policies very easily and rightfully. From June, 2009 even non-life insurance companies also will renew your health insurance. A new terms & condition announces that such rejection will be rare and exceptional now.
According to the news no insurance companies can reject renewing your health insurance policies now which you have claimed previous years or during premium renewing cover arbitrarily.
IRDA (Insurance Regulatory & Development Authority) announced in news with Hindustan Times, “ordinarily renewable except on grounds such as fraud, moral hazard or misrepresentation of facts. Specifically, renewal shall not be denied on the ground that the insured had made a claim in the previous years.”
If insurer proposed to increase your premium while renewing your insurance policy then they would have to inform you before three months for it. Along with it they would have to explain all the details with reasons.
J Hari Narayan who is the chairman of IRDA told with HT in a press, “There were several complaints from policy-holders who had claimed earlier that their insurers have refused renewing their policies next year without giving reasons for rejection.”
From now the prospects of health insurance will be upfront with all the details including all coverage. Maximum age to renew will be decided. All the details of pre-existing diseases will be in details.
It is the much comfortable news for those who have health insurance policies and those who have to renew this. We can’t say how effective it because health insurance policies are very complicated subject. In spite of the news announce that now health insurance policies will be easy and all the details will be in prospectus.
Still there is no review about the news however; we assume that soon there will be practical aspect of the news. If health insurance policies will be truth like the news then surely everyone will feel comfortable.
Banking and Insurance is in the loss across the world
One of the largest insurance companies American International Group Inc. has lost about $60 billion in just 92 days. The amount is as high as $470,000 in a minute. You can say that it is equal to the net worth of Bill Gates.
The loss has made a history in the insurance sector. About the loss of AIG it is being said that if $62 billion is distributed in US population then each Americans is able to get about $200.
About the loss of AIG’s loss HT writes, “AIG’s loss amounts to 92 per cent of the $67.4 billion that Americans spent at world’s largest retailer Wal-Mart Stores Inc. in the fourth quarter, which includes the holiday season. It would take a person spending $1 million per day, everyday, the next 169 years to spend as much money as AIG lost during the fourth quarter, which lasted just 92 days.”
With the news it is clear that insurance sector is also in the crisis. There is data which clear about the crisis but what is real cause and internal crisis no one knows because we have the example of one of the biggest technology company Satyam.
On the other hand in the banking sectors there is hot news about HSBC, which is one of the biggest banks of Europe. HSBC bank has announced that there is slump about 70% in its annual net profit. On the bank there is huge debts about 25 billion dollars.
To fight the crisis they are planning to cut 6,100 jobs by shutting most of its HFC branches. About the crisis Stephen Green who is the chairman of HSBC said with Hindustan Times, “”In this difficult environment, we missed our profitability targets. The coming twelve months will be difficult. We expect parts of Asia, the Middle East and Latin America to continue to outperform Western economies, but to be constrained by the global downturn.”
These slowdowns are quite clear now in banking and insurance sectors due to economic crisis. What will be with insurance policy no one knows. What is the planning by corporate companies is not clear still however the job crisis is on the head of common people. There is no way now to survive life.
Jivan Anand Life Insurance Policy from LIC and My Experience
I have already told you in my previous post about my experience with corporate health insurance. Now, I want to share my own life insurance experience to you. I am 24 years old still I was not insured. Once day, I met with my teacher friend. We were talking with some different topic. Suddenly, we come to the insurance topic. He asked me about my life insurance. I told him that I don’t think about insurance and have not thought over the insurance policy.
Now, he was serious. He begins arguments with me about insurance. He gives one suitable argument that no car and motor bike run on road without insurance then you do you not think about your life insurance? “We also run on road every day then why should we don’t feel about our life insurance?”
After that logic I had no space for arguments. That time I decided to be an insured person. He was an insurance agent actually. That is why he wanted to make me insure. In spite of some reality was there. I asked him to tell me about best policy. He was my friend so he suggested for Jivan Anand Life Insurance of LIC.
He told me that JEEVAN ANAND is unique combination of ’’Whole Life’’ and ’’Endowment’’ policy. By this policy I was able to get an insurance of whole life without paying policy amount.
He told me that if you get a policy of Rs. 1 lakh then you have to pay only premium of Rs. one lakh. After that you will get endowment at the end of the selected term or on end of your life.
He told me about premium also that you are able to pay in term of yearly, half-yearly, quarterly or monthly. I saw an advertisement also nearly about Jivan Anand policy that if you take the policy then your life will be “ANAND HI ANAND”.
Now, I want to ask that let me know Jivan Anand is right for me or is there any other policy which is better for me?
