Health plan sensation may lead to wider increase for more schemes

The government is examining the possibility of turning its two important social sector programmers into universal schemes covering the unorganized sector in phases, taking a cue from the successful extension of a health insurance plan to 23 million poor families.

The labour ministry will prepare a feasibility plan together with the rural and finance ministries that run the old age pension scheme for the below poverty line people and the Aam Aadmi Bima Yojana (AABY) targeting the rural landless.

"The idea is in its conceptualization stage. We have to carry out studies and discuss all details, including funding options, with the rural development and finance ministries," labour secretary P C Chaturvedi told ET.

The insurance plan provides death and disability cover to one member of rural landless households while the Indira Gandhi old age pension scheme gives 400 to people over 65 years in the BPL category.

"We want the schemes to be extended to the entire unorganized sector, but it has to be done in phases," Chaturvedi said.

The issue may be taken up at the next meeting of the National Social Security Board, which is headed by the labour minister and has representatives from various ministries, including agriculture, rural development, urban development and housing and poverty alleviation.

The government has attained some amount of success in extending health cover to the poor through the Rashtriya Swasthya Bima Yojana run by the labour ministry that provides Rs 30,000 health insurance to poor families through smart cards. The scheme, initially targeted at the BPL population, is now being extended to various unorganized sections such as construction workers, coolies and domestic workers. In fact, it is the success of the RSBY that has been successfully extended to 23 million poor families in 330 districts in 27 states, that has prompted the labour ministry to plan an extension of the other two schemes.

"Since we have already created a database through the distribution of smart cards under RSBY and are building on it, the same infrastructure can be used for universalisation of the other two schemes," Chaturvedi said.

According to Subhash Bhatnagar from the National Campaign Committee for unorganized sector worker, extending the two schemes to all unorganized workers will help beef up the grossly inadequate social security cover available to the country's poor provided it is properly implemented. "It should not end up being a revenue earner for insurance companies, while workers struggle to get benefits," he said.

Linking the two schemes with the smart cards given under RSBY was good as the card made the scheme portable. "The card makes it possible for a migrant worker working in a particular state to move to another and continue to be part of the scheme," he said.

Under the old age pension scheme, the Centre provides Rs 200 pension per month to BPL population over 65 years of age and the states are advised to contribute the same amount.

Under the AABY, the head of a rural landless family is insured and the nominee is assured Rs 30,000 if the insured dies a natural death and 75,000 in case of death due to accident or total permanent disability. Both the state and Centre share the annual premium amount of Rs 200.

Protect your Vijaya bank running loan with Bajaj Allianz Insurance cover

Vijaya Bank has signed an MOU with Bajaj Allianz Life Insurance to cover its borrowers under a group life insurance plan.

As part of its ongoing strategy to provide to the diverse needs of its increasing clientele, the bank has been launching products and services tailor-made for different segments.

Through the present understanding with Bajaj Allianz Life Insurance, the bank is offering a product which enables the borrower, in an economical way, to protect his/her family from the load of repayment of the loan in the event of death.

Through this partnership, Bajaj Allianz aims to cover up to 4 lakh borrowers of Vijaya Bank across the country. The product will cover housing loans, education loans, vehicle loans, personal loans as well as other loans.

"This is a key that will provide financial protection from the load of loan repayment in the ill-timed event of borrower's death. Over 4 lakh borrowers in 1,185 networked branches of the bank spread across 28 states and 4 Union territories can avail the facility," Vijaya Bank chairman and managing director Albert Tauro said.

"This insurance plan will cover all customers of Vijaya Bank who have taken a loan for various purposes, irrespective of the amount of loan sanctioned. This coverage under a single product makes it easier for the bank and their customers to administer. Our partnership is another step in our association with such a big public sector bank, like Vijaya Bank," Bajaj Allianz Life Insurance chief distribution officer AS Narayanan said.

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.

Reliance Life launches Traditional Investment Insurance Plan

Reliance Life Insurance, an ADAG group company, has launched a savings cum protection plan. It’s a traditional investment plan that provides life protection and regular savings with yearly guaranteed investment income. The new scheme is a regular premium plan offer guaranteed investment returns. The guaranteed return module would be confirmed at the beginning of every financial year during the product term, the Life insurance company said in a statement.

The growth rate for the 2010-11 financial years is 7.75% per cent. At any point of time, the minimum guaranteed growth rate will not be less than the savings bank deposit interest rate as confirmed by the Reserve Bank, the company added. The insurance plan is available to children aged less than 30 days and senior citizens aged up to 70 years, with monthly, quarterly, half-yearly and yearly payment option. The fixed sum assured under the plan is 7.5 times of the annualized premium. The minimum term of the policy is 10 years and the maximum is 30 years. Besides the maturity and tax benefits, it offers health-connected cover which will pay a lump sum to the customer for as many as 33 specific surgeries, including open heart, kidney transplant, and 25 critical conditions. These riders can be added by paying an additional premium.