Insurance Plans Reviews and Articles

Reliance Mutual Fund Introduces Fixed Maturity Plan

Posted in Mutual Funds by kishosingh on April 14, 2010

Recently, Reliance Mutual Fund unveiled fixed maturity plan. The news came in light through ET online news paper.

The online news portal, economictimes.indiatimes.com, writes about the fixed maturity plan of Reliance Mutual Fund, “Reliance Mutual Fund has come up with a fixed maturity plan —Fixed Horizon Fund – XIV – Series 9. As per the scheme information docu-ment, the primary investment objective is to generate regular returns and growth of capital by investing in central and state government se-curities and other fixed income or debt securities, normally maturing in line with the scheme’s maturity, with the objective of limiting in-terest rate volatility.”

So, the Mutual Fund has come with a fixed maturity plan. It belongs to a series of Fixed Horizon Fund – XIV – Series 9. Reliance Mutual Fund will generate regular returns and growth of capital by fixed maturity plan investing in central and state government securities and other fixed income.

The statement makes the objective of fixed maturity plan very clear. With the fixed maturity plan, Reliance Mutual Fund will try to generate fixed money investing capital in government sectors.

Reliance Mutual Fund unveils fixed maturity plan for a limited period. About the period, ET writes, “The close-ended scheme, which opened for sub-scription from April 7, 2010, will close on April 15, 2010. The mini-mum subscription amount for the scheme is Rs 5,000.”

So, Reliance Mutual Funds offer the fixed maturity plan for just a month only. Subscriber can buy it between the date periods. A subscriber can invest a minimum amount of fund also that is Rs. 5,000 in this scheme.

Reliance Mutual Funds has made the fixed maturity plan very comfortable with Rs. 5,000. The scheme has been launched broadly to attract almost all classes of people.

We already have seen the performance of Reliance Life with Highest NAV Guarantee plan. Now, Reliance Mutual Funds tries to collect some huge money from market by fixed maturity plan.

SEBI has banned 14 life insurance companies from issuing ULIP

Posted in life insurance by kishosingh on April 11, 2010

Recently, market regulator SEBI banned 14 life insurance companies from issuing ULIP. ET writes about those companies who have been banned by SEBI, “The 14 companies mentioned in this order include; Aegon Religare, Aviva, Bajaj Allianz Life Insurance, Bharti AXA, Birla Sun Life, HDFC Standard Life, ICICI Prudential, ING Vyasa Life, Kotak Mahindra Old Mutual Life, Max New York Life, Metlife India, Reliance Life, SBI Life, TATA AIG Life.”

J Harinarayan who is the chairman of IRDA said, “After due consultation with the members of the consultative committee all the 14 insurance companies which are mentioned in the order of Sebi are directed to note that notwithstanding the said order of the Sebi, they shall continue to carry out insurance business as usual including offering, marketing and servicing ULIPs in accordance with the Insurance Act 1938.”

The statement was published in economictimes.indiatimes.com, an online news portal about economy and business.

Further the news portal quotes another statement of IRDA, “The IRDA Act `99 is specifically enacted to provide for an authority to protect the interests of holders of insurance policies, to regulate, promote and ensure the orderly growth of the insurance industry.”

In an analysis the news portal quotes some data of IRDA, “Sebi’s order has more far reaching implications than a press release or a circular. Since the order has been issued under Section 34(i) (a) and (b) of the insurance Act. IRDA has said that in the year `08-09 ULIP policies involving a total premium of Rs 90,645 cr were in force. In fiscal `09-10 upto February 16.7 lakh policies have been sold with a premium of Rs 44,611crores.”

Now, the whole things are very clear from the above mentioned data. It is nothing but regulatory battle in insurance segment of India. It is the biggest news in life insurance segments for insurance companies just like M&A guidelines for insurance companies.

ESIC Medicare Facilities for Unorganised Sector Workers

Posted in health insurance by kishosingh on March 24, 2010

With the recent updates in ESIC policy now, millions of workers in the unorganised sector would be able to take advantage of the ESIC medicare facilities. Recently, government announced to amend the Employees’ State Insurance Act 1948 to significantly enhance the social security coverage.

ESI Corporation sources said to ET, “The facilities of ESIC would now be extended to workers in the unorganised sector under Rashtriya Swasthya Bima Yojana by making optimum use of under-utilised hospitals and dispensaries of ESI Corporation.”

Further sources said, “The ESIC would be empowered to enter into an agreement with any local authority, local body or private body for commissioning or running ESI hospitals through third party participation for providing medical treatment and attendance to insured persons.

The state governments, with the prior approval of the Centre, would be able to set up autonomous organisations on the pattern of ESIC.

A Bill to amend the ESI Act 1948 would be brought before Parliament.”

Now, the act will interact with local authority, local body or private body to empower and providing medical treatment.

About this updates, economictimes.indiatimes.com, a business and finance news portal writes, “A decision to amend the existing Act to ensure effective implementation of the Employees’ State Insurance Scheme was taken at a meeting of the Union Cabinet chaired by Prime Minister Manmohan Singh.”

According to the updates, “It would apply to all places where ten or more workers are employed.”

So, it is effective for those workers who work in a team of at least 10 workers. In Delhi, there are many un-organised sectors which have not a team of 10. What about them? Will they still out from the facilities?

Still there is need of lots of improvement in ESI act and policies. It should be easier and more effective from the government sides. It is other good news in insurance field after Wealth Plus Insurance Policy from LIC.

Wealth Plus Insurance Policy from LIC

Posted in life insurance by kishosingh on March 16, 2010

Wealth Plus is a new offering of LIC. It is an 8-year fixed-term product. In this plan, LIC guarantees the highest Net Asset Value (NAV) recorded over the first seven years of the policy.

According to the economictimes.indiatimes.com, an online news portal, “Wealth Plus has two options — a single premium one and another plan where premium is payable for the first three years. The minimum annual premium is Rs 40,000 under the single premium option and Rs 20,000 under the 3-year premium paying term. The sum insured is a modest 1.25X the premium for single premium policies and 5X the annualised premium for policies with a 3-year payment term. The insurance cover continues for two years after the term of the policy.”

About the policy LIC states an example – “a 30-year old who invests a single premium of Rs 40,000 can look forward to getting back Rs 64,679 if the fund value appreciates 10% annually. If the appreciation is 6%, he can expect to get back Rs 47,377 at the end of eight years. On the other hand, if the same investor chooses to invest Rs 20,000 for the first three years, he can look forward to getting Rs 91,445 if the fund appreciates 10% and Rs 70,309 if the appreciation is 6%.”

In an analysis, the news portal writes, “In short, the working behind such products is that the highest NAV is assured by shifting assets to debt as timed by the fund manager. The downside is that the fund managers cannot allow spikes in the scheme’s NAV.”

Wealth Plus is the latest offering of Life Insurance Corporation. However, many other private life insurance companies have already launched the same plan in the insurance market.

Recently, Reliance has also launched highest NAV Guarantee Plan. We already have seen Guarantee Builder of Bharti AXA Life also. In this condition, Wealth Plus of LIC is only an insurance plan not a new plan.

Highest NAV Guarantee Plan is launched by Reliance Life

Posted in insurance by kishosingh on February 24, 2010

Recently, the popular news about NAV Guarantee Plan came in light for the insurance investor. “Reliance Highest Net Asset Value Guarantee Plan” is a new unit linked insurance plan of Anil Ambani Group firm Reliance Life Insurance that enables the policy-holder to enjoy good returns.

Malay Ghosh who is the Reliance Life Insurance president says, “The new plan simply captures and guarantees the upside of the market with no risk of negative return. The customers can take advantage of market-linked returns with the satisfaction of getting the highest NAV during the policy term, while protecting his wealth from any downturn in the market.” The statement was published in ET online news paper.

Further Economic Times writes, “The key differentiator is that the Net Asset Value (NAV) in this case is calculated on a daily basis for the entire policy term and not on any fixed dates of the month, the company said in a release.

Under this plan, the premium paid by the policyholder (minus charges) is invested in the ‘Highest NAV Guarantee Fund’ and accordingly units are allocated based on the fund NAV.

On maturity the plan guarantees the highest ever returns — number of units on date multiplied by highest NAV– to the customer.”

Samaylive.com which is another online news paper, writes about the plan, “The plan is available under two minimum payment options Regular options that allows customers to pay Rs 20,000 annually which can also be paid in monthly, quarterly and half yearly option; and the Single Premium wherein the customer pays a minimum of Rs 30,000 only once at the inception during the tenure of the policy.”

Overall, the policy gives the highest returns on lower investment. Essence of the plan is introducing highest returns with the guarantee on the lowest investment. Recently, new ULIP plan was also launched by ICICI Prudential Life that was very attractive for insurance investor.

New ULIP Plan Launched by ICICI Prudential Life Insurance

Posted in insurance by kishosingh on December 29, 2009

Recently, Prudential Life Insurance launched a new ULIP plan that is called ICICI Pru LifeTime Maxima. The insurance policy follows two different portfolio strategies – fixed and trigger portfolio. Fixed portfolio strategy provides an option to choose from any of the seven funds — Opportunities Fund, Blue-chip Fund, Multi-Cap Growth Fund, Multi-Cap Balanced Fund, Income Fund, Money Market Fund and Return Guarantee Fund.

On the other hand, trigger portfolio strategy is a market base portfolio to generate good funds from the market.

If you invest your money in trigger portfolio strategy then your investments will be distributed between two funds: Multi-Cap Growth Fund and Income Fund in 75:25 ratios. In this plan, fund manager maintains the asset allocation between the Multi-Cap Growth Fund and Income Fund at 75:25.

First year premium allocation charge is 7.5% in this investment. Second and 3rd year charge will be only 3% while it is 0% from the fourth year onwards. In this investment, fund management charge would depend upon the choice of funds between 0.75-1.35 percent.

Administration charge for the policy will be necessary for 1st five years in this plan that would be 0.8-0.9 per cent.

The policy offers some good features such as changing of portfolio strategy once a year free of cost, top-up option and partial withdrawals from the sixth year up to a maximum of 20 per cent.

You can withdraw minimum Rs 2,000. You can withdraw your funds in a systematic way yearly, half yearly, quarterly or a monthly basis on maturity. During the settlement period, you can withdraw your entire fund.

You should go in trigger portfolio strategy because it works in a volatile market. Your fund is managed by professional fund manager who understands the vagaries of the stock market.

The analysis is taken from Economic Times. It is nothing but an investment with a secure policy. Basically, it is the market policy. Recently, TATA AIG had also launched Life InvestAssure Superstar ULIP but it was not market based plan.

Tata AIG Launches Life InvestAssure Superstar ULIP

Posted in insurance by kishosingh on November 30, 2009

Recently, the biggest insurance company of private sector, TATA AIG launches life InvestAssure Superstar ULIP plan. ULIP is known as Unit-Linked Life Insurance Plan. The plan is dedicated to the children’s education. The plan is known as InvestAssure Superstar.

InvestAssure Superstar will pay the sum assured to the nominee in case of the parent’s or proposer’s demise unfortunately. In this case, the further premium will be paid by the company through the inbuilt Waiver of Premium. WOP pays the premium among other benefits also.

The claim fund will grow under the policy and would continue till maturity. This statement is proposed by the company, TATA AIG in an official statement.

The plan offers another benefit of investors Systematic Money Allocation and Regular Transfer. SMART of the plan will give a solution for managing investment.

SMART will give a path of choice for an investor of simple switching of a part of the customer’s investment from the accumulation to the target fund.

You can enjoy with Tata AIG Life InvestAssure Superstar’s flexible policy term which will be between 10-25 years.

Anyone can buy the policy whose age is between 18-55 years. The maximum maturity age for Tata AIG Life InvestAssure Superstar is 65 years.

Tata AIG launches Life InvestAssure Superstar which gives the maximum security in the plan about the maturity and premium. The child ULIP plan is better for any person because of WOP. The plan gives an investment opportunity also by SMART features.

Tata AIG launches Life InvestAssure Superstar that will create the biggest competition with HDFC children’s Plan. In the insurance market, it is the best plan by TATA AIG for Indian people.

In Indian insurance market, Apollo DKV health plan was the best. Apollo DKV had been launched recently as the health insurance plan. So, the both plans- Tata AIG Life InvestAssure Superstar and Apollo DKV health plan are the best plan for Indian customers.

Jeevan Nischay Policy is to be launched by LIC

Posted in insurance by kishosingh on October 29, 2009

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

Posted in insurance by kishosingh on September 22, 2009

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

Posted in insurance by kishosingh on August 6, 2009

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.