Jointly promoted by Bank of Baroda, Andhra Bank and Britain’s, on Wednesday said its shareholders have infused Rs 125 crore capital for expanding distribution network.
"With the Rs 125 crore infusion, the total paid up capital of the company now stands at Rs 455 crore," IndiaFirst Life Managing Director and CEO P Nandagopal.
He said the company will take up the capital base to Rs 2,500 crore in 10 years.
"In the next fiscal we will infuse about Rs 200 crore. We will take up the equity base to Rs 1,500 crore by the end of the first five years. We have finished our for this fiscal," Nandagopal said.
IndiaFirst, which started operations in November 2009, is the 23rd player in the life insurance space. While BoB holds 44(%) per cent, Andhra Bank has an equity stake of 30(%) per cent and the remaining 26 per cent is with the British partner.
"We will be coming out with two traditional products for which we will file with (insurance regulator) IRDA in two weeks time. We will come out with health insurance plans next year," Nandagopal said.
The company has a network of 4,500 bank branches.
Thursday, September 30, 2010
Tuesday, September 28, 2010
Insurance firms squeeze outsourcing to cut costs
Hemmed in by regulatory changes and a potential squeeze in profitability, insurance companies are now increasingly looking to outsource many of their non-core functions to cut costs and remain competitive. ICICI Prudential, Max New York Life and HDFC Standard Life are among those who have initiated discussions to outsource some of their activities as focus shifts to cost control and consolidation.
Claims administration, analytics, customer care, policy administration, sales and distribution and even product development, are some of the areas that insurance companies are looking to outsource to specialist firms.
This is a departure from the past when insurance companies’ corporate strategies largely revolved around growth in policy sales and premium collection.
Max New York Life has engaged consulting firm McKinsey to carry out a comprehensive cost-benefit analysis across verticals.
“We are looking at ways to reduce costs and one of the options could be to outsource certain areas but we need to see what exactly the impact would be,” a senior official at a Mumbai-based private insurance company, who did not wish to be identified, told Hindustan Times.
Insurance companies are desperately seeking options to cut costs after sector watchdog Insurance Regulatory Development Authority (IRDA) enforced a new set of norms from this month for the controversial Unit Linked Insurance Products (ULIPs).
ULIPs — a hybrid product where a part of the money is invested in equities and the balance is set aside as premium and charges and fees — accounts for more than half of the life insurance firms’ total business.
The new norms have capped surrender charges of policies, slashed agent commissions and seek to make charges more transparent to prevent mis-selling. This will reduce profitability of companies but also help consumers by making their investments more transparent.
Business process outsourcing companies expect a major jump in their insurance related services in India in the coming months.
“We are in healthy discussions with many of the insurance companies in India for providing specialist services across all sub-verticals,” said Keshav R Murugesh, Group CEO of WNS, a leading global business process outsourcing company.
Claims administration, analytics, customer care, policy administration, sales and distribution and even product development, are some of the areas that insurance companies are looking to outsource to specialist firms.
This is a departure from the past when insurance companies’ corporate strategies largely revolved around growth in policy sales and premium collection.
Max New York Life has engaged consulting firm McKinsey to carry out a comprehensive cost-benefit analysis across verticals.
“We are looking at ways to reduce costs and one of the options could be to outsource certain areas but we need to see what exactly the impact would be,” a senior official at a Mumbai-based private insurance company, who did not wish to be identified, told Hindustan Times.
Insurance companies are desperately seeking options to cut costs after sector watchdog Insurance Regulatory Development Authority (IRDA) enforced a new set of norms from this month for the controversial Unit Linked Insurance Products (ULIPs).
ULIPs — a hybrid product where a part of the money is invested in equities and the balance is set aside as premium and charges and fees — accounts for more than half of the life insurance firms’ total business.
The new norms have capped surrender charges of policies, slashed agent commissions and seek to make charges more transparent to prevent mis-selling. This will reduce profitability of companies but also help consumers by making their investments more transparent.
Business process outsourcing companies expect a major jump in their insurance related services in India in the coming months.
“We are in healthy discussions with many of the insurance companies in India for providing specialist services across all sub-verticals,” said Keshav R Murugesh, Group CEO of WNS, a leading global business process outsourcing company.
Friday, September 24, 2010
Car Insurance myths | what affects car insurance Premium?
1. New Cars Cost More to Insure - This is not always the case. Depending on the driver’s history, insurance for a brand new car is often cheaper than a five or ten year old version of the same vehicle. Newer models have top of the range security features installed, meaning that they are statistically less likely to be stolen, a fact that helps to bring insurance costs down. Older models also tend to be owned by younger or new drivers, who insurers class as a bigger risk and charge a higher premium.
2. Car Color Matters - Although insurers take many factors into account, including engine size, age and value of the car, driver’s record etc., they don’t take any notice of the color.
3. Being Loyal to Insurer leads to Cheaper Coverage - Staying with the same insurance company year on year won’t automatically lower your premiums. It always pays to shop around for a better deal and compare car insurance quotes when it’s time to renew your policy, because providers don’t necessarily reward your loyalty with a reduced price.
4. New Cars Are Stolen More - New models have much more advanced security equipment and anti-theft devices installed, meaning that criminals steer clear and target older vehicles that are easier to steal instead.
5. A Car is Worth What You Paid for It - If your car is totaled or stolen, insurers will only pay to replace it with a similar model at today’s market rate, not the value you paid for it originally.
6. Credit Scores Don’t Count - Sadly this isn’t the case. Most insurers now factor in a customer’s credit score when calculating their insurance quote. The better the credit score, the lower the premium will be. Build your score by keeping on top of credit cards debts and paying bills on time, and you’ll start to see a difference when you renew your auto insurance policy.
7. No Fault Insurance Means It’s Never My Fault - The only thing no fault insurance covers is your medical bills if you are in an accident, whoever is at fault. It doesn’t cover the other driver, it doesn’t cover damage to cars, and it certainly doesn’t mean you’re absolved of any responsibility if you are to blame.
8. I’ve never been in a Crash So I Don’t Need Insurance - Just because you’ve been lucky enough to avoid accidents so far doesn’t mean that’ll always be the case, no matter how good a driver you are. But it’s not just the peace of mind that having motor insurance can provide if something were to go wrong. It’s actually a legal requirement to have some form of insurance, so it’s not an even an option, you must have some sort of protection.
2. Car Color Matters - Although insurers take many factors into account, including engine size, age and value of the car, driver’s record etc., they don’t take any notice of the color.
3. Being Loyal to Insurer leads to Cheaper Coverage - Staying with the same insurance company year on year won’t automatically lower your premiums. It always pays to shop around for a better deal and compare car insurance quotes when it’s time to renew your policy, because providers don’t necessarily reward your loyalty with a reduced price.
4. New Cars Are Stolen More - New models have much more advanced security equipment and anti-theft devices installed, meaning that criminals steer clear and target older vehicles that are easier to steal instead.
5. A Car is Worth What You Paid for It - If your car is totaled or stolen, insurers will only pay to replace it with a similar model at today’s market rate, not the value you paid for it originally.
6. Credit Scores Don’t Count - Sadly this isn’t the case. Most insurers now factor in a customer’s credit score when calculating their insurance quote. The better the credit score, the lower the premium will be. Build your score by keeping on top of credit cards debts and paying bills on time, and you’ll start to see a difference when you renew your auto insurance policy.
7. No Fault Insurance Means It’s Never My Fault - The only thing no fault insurance covers is your medical bills if you are in an accident, whoever is at fault. It doesn’t cover the other driver, it doesn’t cover damage to cars, and it certainly doesn’t mean you’re absolved of any responsibility if you are to blame.
8. I’ve never been in a Crash So I Don’t Need Insurance - Just because you’ve been lucky enough to avoid accidents so far doesn’t mean that’ll always be the case, no matter how good a driver you are. But it’s not just the peace of mind that having motor insurance can provide if something were to go wrong. It’s actually a legal requirement to have some form of insurance, so it’s not an even an option, you must have some sort of protection.
Wednesday, September 22, 2010
Endowment Plus Policy launched | LIC
Life Insurance Corporation of India (LIC) launched another unit-linked pension plan named - Endowment Plus Policy, under the new Insurance Regulation and Development Authority (IRDA) regime.
Pension Plus being the first unit-linked product launched in unison with the new IRDA guidelines.
Endowment Plus offers:
• Investment-cum-insurance during the term of the policy and
• Available for people under 7-60 years for a policy term between 10 years and 20 years.
Other features:
• The minimum annual premium under the insurance policy is Rs 20,000 for regular modes and a risk cover of up to 11-30 times of annualized premium or 1.25 times of single premium.
• Critical illness and accident benefit riders are also available with this policy.
• The policy holder has the option to choose any of the 4 funds namely - Bond Fund, Secured Fund, Balanced Fund Growth Fund.
• The option of switching within the funds is available any number of times during the duration of policy. The first four switches every year are free of charge and Rs 100 is levied thereafter per switch.
Pension Plus being the first unit-linked product launched in unison with the new IRDA guidelines.
Endowment Plus offers:
• Investment-cum-insurance during the term of the policy and
• Available for people under 7-60 years for a policy term between 10 years and 20 years.
Other features:
• The minimum annual premium under the insurance policy is Rs 20,000 for regular modes and a risk cover of up to 11-30 times of annualized premium or 1.25 times of single premium.
• Critical illness and accident benefit riders are also available with this policy.
• The policy holder has the option to choose any of the 4 funds namely - Bond Fund, Secured Fund, Balanced Fund Growth Fund.
• The option of switching within the funds is available any number of times during the duration of policy. The first four switches every year are free of charge and Rs 100 is levied thereafter per switch.
Saturday, September 18, 2010
Loansurance Group Life Plan launched | IDBI Federal Life Insurance
IDBI Federal Life Insurance launched a group cover for loans - Loansurance Group Life Plan - a solution that will enable investors protect their borrower's assets and savings.
Customers of the plan gets to cover their borrowers, it could be a loan taken by any individual or by a business entity, against default in case of death of the person who is responsible for loan repayment.
To quote IDBI Federal Life Insurance Managing Director and CEO, G V Nageswara Rao - "Loansurance can help lending institutions to build strong bonds and customer loyalty by ensuring that their debt does not become a burden on their families in their unfortunate absence. They would also be protected from the risk of non-payment of the loan due to death of the borrower".
The unique feature of the plan is its cost-effective way to ensure that the outstanding debt is settled in the unfortunate event of death of the insured member.
The plan comes with two cover options
1. Reducing cover - the insurance cover reduces as per the benefit schedule
2. Level cover - the insurance cover remains unchanged throughout the cover term.
Customers of the plan gets to cover their borrowers, it could be a loan taken by any individual or by a business entity, against default in case of death of the person who is responsible for loan repayment.
To quote IDBI Federal Life Insurance Managing Director and CEO, G V Nageswara Rao - "Loansurance can help lending institutions to build strong bonds and customer loyalty by ensuring that their debt does not become a burden on their families in their unfortunate absence. They would also be protected from the risk of non-payment of the loan due to death of the borrower".
The unique feature of the plan is its cost-effective way to ensure that the outstanding debt is settled in the unfortunate event of death of the insured member.
The plan comes with two cover options
1. Reducing cover - the insurance cover reduces as per the benefit schedule
2. Level cover - the insurance cover remains unchanged throughout the cover term.
Thursday, September 9, 2010
3 new products launched by Aviva Life Insurance
Three new products are launched by the private insurer Aviva Life Insurance which includes two unit-linked insurance plans (or as we all call them, ULIPs).
The company says -
"... The two ULIP plans -- Aviva Freedom Life Advantage, Aviva Life Saver Advantage -- offer enhanced value to the customers and meet the new ULIP guidelines".
The third product - Aviva Life Shield Advantage - promises a return on the premium, with optional protection against disease and disability as well.
These products are in accordance with the new IRDA guidelines, as the commission paid to distributors and expenses charged by insurers will not be front-loaded and will be distributed over the lock-in period of the schemes, which has been raised to five years from three years (earlier).
A little about the Company –
Aviva Life Insurance is a joint venture between Dabur Group (74 %) and UK-based Aviva Group (26%).
The company says -
"... The two ULIP plans -- Aviva Freedom Life Advantage, Aviva Life Saver Advantage -- offer enhanced value to the customers and meet the new ULIP guidelines".
The third product - Aviva Life Shield Advantage - promises a return on the premium, with optional protection against disease and disability as well.
These products are in accordance with the new IRDA guidelines, as the commission paid to distributors and expenses charged by insurers will not be front-loaded and will be distributed over the lock-in period of the schemes, which has been raised to five years from three years (earlier).
A little about the Company –
Aviva Life Insurance is a joint venture between Dabur Group (74 %) and UK-based Aviva Group (26%).
Tuesday, September 7, 2010
Private insurers to espouse PSU rates for cashless mediclaim
Private non-life insurance companies are expected to implement the packaged rates prescribed by their public sector counterparts for cashless mediclaim.
“Private players have expressed interest in following the packaged rates decided by the PSU insurers,” said a senior General Insurance Public Sector Association (Gipsa) member who did not want to be quoted.
The rates worked out by Gipsa are likely to be 15-20(%) per cent less than what healthcare providers charge at the instant.
“We have in principal agreed to be part of the packaged charge. But the mechanics of packaging needs to be worked out. We will join them, but how soon will depend on how fast they move and incorporate us,” said Sanjay Datta, head of health insurance at ICICI Lombard.
The PSU insurers had graded hospitals fewer than 4 categories – primary, secondary, tertiary and tertiary plus, the Gipsa member said. He added they had made a list of 43 diseases. The rates, 15-20(%) per cent less than what the hospitals charge, will differ on the basis of provider, infrastructure, location and past experiences.
“We have not properly advised on the rates but would like to join them if it brings down our costs,” said T R Ramalingum, head of underwriting, Bajaj Allianz General Insurance.
By packaging rates and stabilising costs, insurers expect to cut expenses. “The claim ratio may not fall but the cost of treatment at individual hospitals will become standardised. The rates may differ from one hospital to another based on location and facilities,” said New India Assurance Chairman and Managing Director M Ramadoss.
State-run insurers have made a list of hospitals in the National Capital Region, Mumbai, Chennai and Bangalore. The rates are worked out on the basis of those accepting the rate packages. The rates include medical procedures and hospitalisation costs.
The public sector insurance companies — New India Assurance, National India, United India and Oriental Insurance —launched a new list for the preferred provider network after they stopped the cashless facility from July. Under the new list, only healthcare providers selected by the four insurance companies are covered by the cashless mediclaim policy.
Meanwhile, the Insurance Regulatory and Development Authority (IrDA) has asked insurance companies to provide the cashless facility if the policyholder is undergoing treatment in a hospital that has been put off the preferred network list.
The insurance industry has been incurring huge losses in the health segment. In the last financial year, PSUs paid claims of Rs 5,400 crore, as against a total collection of Rs 4,900 crore.
For policyholders willing to pay higher premium to be treated at any elite hospital, insurance companies are working on a different product.
“Private players have expressed interest in following the packaged rates decided by the PSU insurers,” said a senior General Insurance Public Sector Association (Gipsa) member who did not want to be quoted.
The rates worked out by Gipsa are likely to be 15-20(%) per cent less than what healthcare providers charge at the instant.
“We have in principal agreed to be part of the packaged charge. But the mechanics of packaging needs to be worked out. We will join them, but how soon will depend on how fast they move and incorporate us,” said Sanjay Datta, head of health insurance at ICICI Lombard.
The PSU insurers had graded hospitals fewer than 4 categories – primary, secondary, tertiary and tertiary plus, the Gipsa member said. He added they had made a list of 43 diseases. The rates, 15-20(%) per cent less than what the hospitals charge, will differ on the basis of provider, infrastructure, location and past experiences.
“We have not properly advised on the rates but would like to join them if it brings down our costs,” said T R Ramalingum, head of underwriting, Bajaj Allianz General Insurance.
By packaging rates and stabilising costs, insurers expect to cut expenses. “The claim ratio may not fall but the cost of treatment at individual hospitals will become standardised. The rates may differ from one hospital to another based on location and facilities,” said New India Assurance Chairman and Managing Director M Ramadoss.
State-run insurers have made a list of hospitals in the National Capital Region, Mumbai, Chennai and Bangalore. The rates are worked out on the basis of those accepting the rate packages. The rates include medical procedures and hospitalisation costs.
The public sector insurance companies — New India Assurance, National India, United India and Oriental Insurance —launched a new list for the preferred provider network after they stopped the cashless facility from July. Under the new list, only healthcare providers selected by the four insurance companies are covered by the cashless mediclaim policy.
Meanwhile, the Insurance Regulatory and Development Authority (IrDA) has asked insurance companies to provide the cashless facility if the policyholder is undergoing treatment in a hospital that has been put off the preferred network list.
The insurance industry has been incurring huge losses in the health segment. In the last financial year, PSUs paid claims of Rs 5,400 crore, as against a total collection of Rs 4,900 crore.
For policyholders willing to pay higher premium to be treated at any elite hospital, insurance companies are working on a different product.
Monday, September 6, 2010
Future Generali to move out 7 new products
Future Generali Life Insurance Company Ltd, a joint venture between Future Group and the Italy-based Generali Group, would move out 7 new products by March 2011. These products would be a mix up of traditional insurance products and Unit-Linked Insurance Products (ULIPs).
Addressing media persons here, Nirakar Pradhan, chief investment officer of Future Generali India said, “We would be launching 7 new products by March 2011. These would be a mix of traditional insurance products and ULIPs. Currently, we have 18 products in our portfolio which includes 15 conventional products and 3 ULIPs.”
Future Generali is also planning to foray into the micro-insurance section given its huge prospective but the modalities are yet to be worked out, he added.
The insurance firm is eyeing a total pan-India premium collection of Rs 1200 crore for the current financial year which would be a jump of 118.97 per cent over Rs 548 crore which it had actually achieved in 2009-10. TIN the eastern region, the company's premium collection stood at Rs 53 crore in the last financial.
Addressing media persons here, Nirakar Pradhan, chief investment officer of Future Generali India said, “We would be launching 7 new products by March 2011. These would be a mix of traditional insurance products and ULIPs. Currently, we have 18 products in our portfolio which includes 15 conventional products and 3 ULIPs.”
Future Generali is also planning to foray into the micro-insurance section given its huge prospective but the modalities are yet to be worked out, he added.
The insurance firm is eyeing a total pan-India premium collection of Rs 1200 crore for the current financial year which would be a jump of 118.97 per cent over Rs 548 crore which it had actually achieved in 2009-10. TIN the eastern region, the company's premium collection stood at Rs 53 crore in the last financial.
Thursday, September 2, 2010
Two new ULIPs Plan launches by SBI Life Insurance
Private insurer SBI Life launched two Unit-Linked Life Insurance Policies (ULIPs), which observe with the new IRDA guidelines that will become successful.
"SBI Life has launched Smart Performer and Unit Plus Super... In compliance with the new IRDA guidelines, these recently launched ULIPs are equipped with enhanced features such as benefits of higher protection, multiple investment options and a wide range of riders," SBI Life said in a release.
SBI Life Insurance is a joint venture between State Bank of India and BNP Paribas Assurance. SBI has a 74(%) per cent stake in the insurance company, while BNP Paribas Assurance holds the remaining 26(%) per cent.
The Insurance Regulatory and Development Authority's (IRDA) new guidelines protecting ULIP-holders from mis-selling by dealers and onerous commissions are possible to make the equity-linked instruments more investor-friendly.
"Customers will find that the new range is highly beneficial, as it further reinforces the plan of security and long-term wealth creation," SBI Life Insurance MD & CEO M N Rao said.
"SBI Life has launched Smart Performer and Unit Plus Super... In compliance with the new IRDA guidelines, these recently launched ULIPs are equipped with enhanced features such as benefits of higher protection, multiple investment options and a wide range of riders," SBI Life said in a release.
SBI Life Insurance is a joint venture between State Bank of India and BNP Paribas Assurance. SBI has a 74(%) per cent stake in the insurance company, while BNP Paribas Assurance holds the remaining 26(%) per cent.
The Insurance Regulatory and Development Authority's (IRDA) new guidelines protecting ULIP-holders from mis-selling by dealers and onerous commissions are possible to make the equity-linked instruments more investor-friendly.
"Customers will find that the new range is highly beneficial, as it further reinforces the plan of security and long-term wealth creation," SBI Life Insurance MD & CEO M N Rao said.
Wednesday, September 1, 2010
Two Latest Plan launches by Birla Sun Life Insurance
Leading private insurer Birla Sun Life Insurance launched two variants of its just launched savings plan, offering 20(%) per cent assured return at standard intervals.
Bachat Moneyback and Bachat Child plans follow the achievement of the Bachat Endowment Plan, launched this May, which contributed to over 10(%) per cent of overall sales in the first quarter of this financial, Birla Sun Life Insurance Chief Actuarial Officer Fabien Jeudy said.
"Our research shows that there is rising a demand for products on the traditional platform that will help consumers save for their long-term goals during regular and affordable premia. We hope Bachat Moneyback and Bachat Child plans will address these consumer needs effectively," he said.
These plans offer regular money back of 20(%) per cent of the monthly stand premia at every 5th, 10th and 15th policy year, Jeudy said.
In Q1 of this financial, the company reported a profit of Rs 9 crore against a loss of Rs 111 crore in Q1 last financial. Its asset under management grew 44(%) per cent to Rs 16,841 crore in Q1, on a total premium income of Rs 1,143 crore, up 18 per cent. Its new premium grow 7(%) per cent to Rs 473 crore while renewal premium rise by 27(%) per cent to Rs 669 crore.
Birla Sun Life, a JV between the Aditya Birla Group and Sun Life Financial of Canada, has over 2.3 million customers.
For More information about Life Insurance
Bachat Moneyback and Bachat Child plans follow the achievement of the Bachat Endowment Plan, launched this May, which contributed to over 10(%) per cent of overall sales in the first quarter of this financial, Birla Sun Life Insurance Chief Actuarial Officer Fabien Jeudy said.
"Our research shows that there is rising a demand for products on the traditional platform that will help consumers save for their long-term goals during regular and affordable premia. We hope Bachat Moneyback and Bachat Child plans will address these consumer needs effectively," he said.
These plans offer regular money back of 20(%) per cent of the monthly stand premia at every 5th, 10th and 15th policy year, Jeudy said.
In Q1 of this financial, the company reported a profit of Rs 9 crore against a loss of Rs 111 crore in Q1 last financial. Its asset under management grew 44(%) per cent to Rs 16,841 crore in Q1, on a total premium income of Rs 1,143 crore, up 18 per cent. Its new premium grow 7(%) per cent to Rs 473 crore while renewal premium rise by 27(%) per cent to Rs 669 crore.
Birla Sun Life, a JV between the Aditya Birla Group and Sun Life Financial of Canada, has over 2.3 million customers.
For More information about Life Insurance
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