Bajaj Allianz launches guaranteed maturity insurance plan

Type of policy: A single premium Unit Linked Plan. The investment objective of this fund is to provide capital appreciation by investing in a mix of debt and debt-related securities.

Premium: Minimum premium is 5,000 and in multiples of 5,000.

Term of the Policy: The tenure of the policy is 10 years and you are allowed to make partial withdrawals after five years, limited to 1/3rd of the single premium.

Maturity benefit: Higher of the guaranteed maturity value of all the'guaranteed maturity certificates' held at maturity or the fund value as on maturity date. The plan guarantees 200% returns on maturity - that means your money doubles in 10 year (CAGR of 7.18%).

Death benefit: It is calculated as higher of the prevailing sum assured reduced by the value of the units withdrawn through partial withdrawals from the fund value in two years prior to the death, or fund value as on date of receipt of intimation of death.

The sum assured under the plan is five times the single premium in the first policy year and will, for subsequent years, reduce to 1.25 times of the single premium for those who enter the policy before they are 45, and 1.10 times of the single premium for those entering after 45.

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Eligibility: The minimum age at entry in the plan is eight years and the maximum is 60 years

Charges: There is no premium allocation charge. But the policy administration charges are 1.85% per annum of the total single premium in the first five years of the policy, subject to a maximum of 6,000 and 0.70% per annum of the total single premium subject to a maximum of 6,000 per annum.

Policy administration charges and mortality charges are deducted monthly through cancellation of units. Fund management charge is 1% per annum adjusted in the unit price.

The good: It is a simple plan to understand and offers minimum guaranteed return on maturity

The bad: The policy offers reduced life cover from the first anniversary of the policy. Hence, it doesn't serve the purpose of insurance. Also guaranteed returns under the policy are less than the current 10- year G-sec yield or interest rate offered by most banks, without taking tax benefits into account.

Insurance industry to grow from next fiscal: Swiss Re

India's insurance industry is likely to witness significant improvement by next fiscal, both in life as well as non-life categories, triggered by health, micro-insurance and innovative products, global reinsurance major Swiss Re said today.

"The non-life segment is expected to grow by 7.9 per cent in 2012 and 8.5 per cent in 2013, while in the life segment is expected to rise by 7.5 per cent in 2012 and by 11 per cent in 2013. The main drivers for this growth will be health, micro-insurance and innovative product offerings," Swiss Re Vice-President Amit Kalra told reporters here after launching Asia economic and insurance market outlook.

However, this growth trend in non-life is lower than that of 2010, as the motor and trade-related lines are likely to see a slight slowdown, he said.

This segment will mainly be driven by premia from the health sector, he said, adding there are huge untapped opportunities in retail personal lines, liability, micro- insurance and agriculture.

Foreign direct investment in retail could have boosted premium for the non-life industry as international companies take insurance for their establishments, Kalra said.

Globally, in the life segment, premia growth will recover, led by India and China, he said. "We expect strong demand for life insurance, protection and group insurance."

Growth will be supported by recovery in unit-linked products, he said, adding there is also down side risks if the capital markets continue to be suppressed.

Meanwhile, global outlook, he said, remains uncertain due to the world economic crisis, but it would still perform better than banks, he said.

LIC for deeper penetration of low-cost insurance schemes in UP

Public sector insurer Life Insurance Corporation (LIC) aims at deeper penetration of its low cost insurance schemes in Uttar Pradesh.

LIC is concerned over rather low level of awareness among the masses towards such low premium and social security schemes, wherein the government provides 50 per cent premium subsidy from its corpus of about Rs 100 crore. Under the Aam Admi Bima Yojana, which is a low cost insurance scheme for people living below poverty line, LIC has so far settled 1,573 death claims cases amounting to over Rs 5.30 crore in UP.

LIC partners with non-government organisations (NGOs) for these social security schemes at the local level.

“Since UP is such a vast state, these schemes should have more penetration, but the level of awareness is rather missing for bringing a major chunk of beneficiaries under its net,” LIC senior divisional manager Mohd Azeezuddin told Business Standard here.

In the Lucknow and Faizabad regions, LIC has partnered with about 20 NGOs for these social security schemes.

Under the Aam Admi Bima Yojana, about 2.38 million people in 75 UP districts are covered and LIC aims at increasing the base to 3 million this year.

The company provides Janshree Bima Yojana coverage to self help groups (SHG), primitive tribal groups, anganbari workers, handicrafts’ artisans, Mahatma Gandhi Bima Bunkar Yojana, Khadi and Village Industries Commission and various other 45 groups.

Earlier, LIC has also already been engaged by the UP government for executing the annuity scheme under the new land acquisition policy of the state. Since annuity under the land acquisition policy is valid for 33 years, the government felt it would be difficult for the respective district magistrate office to ensure timely and regular payment of annuity to the farmers.

Terms and conditions that an insurance contract does not cover

Your insurance policy is expected to deliver when things go wrong. The insurance company promises to pay the sum assured when an insured event occurs, provided the policyholder has paid the premium in advance. But to bring down the possibility of anti-selection and also limit losses, insurers introduce the concept of exclusions to the cover offered. Exclusions simply connote conditions that an insurance contract does not cover.

An example will make it easier to understand. An individual, with the intention to defraud an insurance company, may buy a life insurance and then commit suicide. A life insurance policy promises to pay the sum assured to the nominee upon the death of the life assured.

But a suicide in the first year of the policy is not covered at all. This ensures that the insurer does not incur undue losses as individuals are highly unlikely to plan a fraud by committing suicide. The same applies for group life insurance policies other than the policies issued in lieu of employees' deposit-linked insurance where the sum assured is limited.

Similar exclusions are applicable for accident disability rider. If a life assured dies in an accident while driving in a drunken state or participating in a car racing event or due to drug abuse, then his survivors won't be paid the benefit payable under the accident cover rider.

Then there are other exclusions such as deaths occurring in war, terrorism, droughts or accidents incited by the actions of the life assured. In case of surgical assistance, surgeries carried out for cosmetic purposes are also excluded.

An insurer may choose to exclude certain benefits for a specific period of time. This is termed as the waiting period and is seen mainly in non-life insurance policies. For example, a critical illness cover will insist on a waiting period of 180 days from the date of issuance of the policy.

The waiting period protects the life insurance company from a fraudulent claim. Some insurance companies cover pre-existing diseases after a waiting period of four years, whereas a set of daycare surgeries is also covered after a waiting period of two years.

While buying a policy, a buyer should read the exclusions in detail. If you need further clarification, you may check the policy wordings and contact the insurance company. If you are moving from one insurer to another for health insurance, please double-check the exclusions in the new policy. Under benefits due to portability, you are entitled to some exclusion waivers.

Keep your insurance policies in demat form

After shares, you can now keep your insurance policies in demat form. In order to reduce transaction costs and ensure swift modifications in insurance policies, the Insurance Regulatory and Development Authority (IRDA) issued guidelines for electronically issuing policies. IRDA has also laid down guidelines for repositories, which compile and store data about policyholders on behalf of insurance companies.

According to the IRDA, the objective of creating an insurance repository is to provide policyholders with a facility to keep insurance policies in electronic form. They can also undertake changes, modifications and revisions in the insurance policy with speed and accuracy.

This would enable the insurance companies to sell all the polices - life, pension and non-life , in electronic form. With the issuance of e-insurance policies, there will be efficiency, transparency and cost reduction in issuing and maintaining them. According to the guidelines, an insurer issuing e-insurance policies will have to take the services of a registered repository. All such insurance policies in electronic form will be treated as valid insurance contracts.

A certified insurance repository has to have a net worth of at least Rs 25 crores, without any foreign investment. No insurance company can hold over 10 percent or hold any managerial position . The repository has measures to safeguard the privacy of the data to prevent manipulation of records and transactions, before the commencement of operations. An insurer can enter into an agreement with one or more insurance repositories for maintaining the electronic insurance policies.

Hence, insurance buyers will now be able to open demat or e-insurance accounts for their contracts and hold the insurance policies in electronic form. Having an e-insurance account will reduce hassles for buyers. The need to provide age and address proof every time a policy is bought will not be necessary now. It will also save insurers substantial money in printing and dispatching policies.

Similar to demat account

E-insurance will be similar to the demat account for shares and mutual funds. Just like the securities market, the IRDA has proposed to create insurance repositories on the lines of securities depositories like the National Securities Depository or the Central Securities Depository. These repositories will be licenced by the regulator and connected to all insurance companies. This will result in efficiency and better customer service by the insurance companies. Since the repository will consolidate all policies under a single account, the family will immediately come to know of the policies purchased by an individual in an emergency.

IRDA will grant licences and regulate insurance repositories, which will act as service providers to life insurance companies. The repository will give a unique number to every individual and all his policies will come under that account. It will hold all types of policies - including life, health, motor and group covers. The data maintained by the repository will include history of the claims of the individual and names of the beneficiary, assignees and nominees.

Dematerialized policies will be more liquid than paper policies as these contracts can be easily assigned. Whenever the policies are assigned, the assignee will have the same rights as the policyholder.

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Any insurance policyholder or a prospective policyholder can open an e-insurance account. Opening an account will require identity proof and address proof. There would be no additional costs for a policyholder for opting for electronic policies. You will not be required to go through KYC (know-your client) procedure every time you buy a policy.

Life insurance favorite investment class of urban Indians

Life insurance products are the hot favorite of most urban Indians as an investment option and they are likely to earmark over half of their investable income for these products in future, says a study by market research firm Nielsen.

According to Nielsen's study on the life insurance sector and investment patterns, 'LIFE 2011', a little over 60 per cent of urban Indians hold insurance policies, which are likely to account for a large share of their future investments as well.

A look at the shift in investment habits over the last two years indicates that people are returning to fixed investment products, while investment in risky categories like equity is on the decline.

The study said that Indians, in practice, remain "risk averse" and the main drive behind an urban Indian's investment is returns, followed by unforeseen emergencies and child education.

"Given the recent volatility in equity markets and rise in commodity markets, urban Indians, being traditionally risk averse, are returning to safer, more traditional investment products like life insurance, given the tax benefits and limited risk associated with the product," Nielsen Head - Finance Practice Subhash Chandra said.

As per the study, there is a sizeable opportunity waiting to be tapped. The young investor segment accounts for nearly a fifth of the population and most of them currently do not hold a life insurance policy. This space is the also the most enthusiastic to invest in life insurance in the immediate future.

"With the youth entering the workforce at high salaries these days, the young investor segment is a huge opportunity for most financial service organisations. Coupled with the historical acceptance of life insurance as a safe investment and the added tax benefits that it provides, life insurance seems to have retained favour with even the young investors," Chandra added.

There is also an opportunity to expand coverage by way of additional policies, as around 16 per cent of life insurance holders are open to investing in a new policy within the next six months.

"While in the short-term, marketers can look at ensuring conversions from this segment, the long-term opportunity for life insurance marketers lies in increasing dual policy ownership. Hence, marketers need to promote the benefits of opting for a second policy to current policyholders," Nielsen Finance Practice Head Insurance and Investments Anand Parameswaran said.

Indians are still not open to making insurance purchases over the internet, going by the response of current policyholders, Neilsen said.

Kingfisher Airlines renews air insurance policy at lower premium

Kingfisher Airlines (KFA) has renewed its annual insurance policy without much hassle as premium rates fell by 37% for its insurance policy, mainly due to the abundant capacity in the reinsurance market. The policy is insured primarily with ICICI Lombard, which is the lead insurer, while Bajaj Allianz, SBI General and IFFCO TOKIO are part of the consortium.

According to a source close to the development, premium rates have come down 37% to 43 crore ($9.5 million) in 2011-12, lower from 60 crore ($15 million) paid in FY11.

"Premium rates have not gone up. This is despite the increase in the number of aircraft during the past one year, increase in landing and increase in passengers. There were not any major claims made by the aviation company," the source revealed.

The airline has coughed up 56 crore towards aviation insurance in FY10 compared with 52 crore in the previous fiscal. The policy covers the hull of the aircraft and liability to passengers. It includes coverage for any third party damage to property or people outside the aircraft.

Aviation policies are mainly reinsurance-driven since underwriting capacity is restricted to 150 crore. The number of accidents determines the premium rates for airlines. Kingfisher had made a claim of $17 million last year for the damage caused to its turboprop ATR that flew from Bhavnagar to Mumbai.

"The capacity available in the market is twice than is required. While there is an intent to increase rates, the capacity remains abundant," said Rajiv Kumaraswamy, head of underwriting at ICICI Lombard. Insurance premium rates had hardened in 2009 with three major accidents - Air France, Yemenia and Caspian Airlines. Prior to this, rates had shot up after 9/11.

The total premium in the airlines sector globally has touched $2 billion in 2010 against $1.6 billion a year ago.

State-run Air India is in the process of renewing its annual policy.

Let needs decide your insurance plan

As Indians, we are naturally very cost conscious and this holds true even for financial products we buy. Premium, the actual amount of money charged by insurance companies for active coverage, is often measured as the cost of an insurance product. An insurance premium for the same service can vary widely among insurance providers. As in the case of consumer durables, the lowest quoted price on an insurance premium may seem like the better bargain, but the level of coverage may also be lower.

Having said that, a cheaper premium is an apt comparison for pure term plans alone, since the benefit offered by all insurers is standard.

For all other types of plans, including health plans, one needs to consider the features and benefits of a product. Customers can review the following guidelines when deciding on subscribing to a particular policy:

Is the life cover offered sufficient? One must definitely ensure whether the life insurance cover is adequate to cover the family in case of an eventuality. While opting for a life cover, one must ensure that the cover is sufficient to cover dependants not only today, but also over the life stage.

Are the features/benefits offered suited to your life stage needs? You must check whether the benefits offered by the policy are suited to your individual needs. A policy providing benefits to customers towards the end of the policy term may be suitable for younger customers, but not for older customers. Similarly, a money-back product may be offering a money-back every three years. However, the amount may be miniscule, compared with the customer’s need. In that case, one is better off choosing an endowment product.

Click here to apply Life Insurance in Delhi

Term of the policy: If you require a term policy to cover dependants during your working years, then the term of the policy must coincide with your planned retirement age. If the policy term is shorter than the desired term, then you may not realise the full potential of the benefits.

Additional protection: In addition to life cover, policies also provide additional protection against critical illnesses, accidental death and permanent disability. It is important to check whether your policy offers such options or inbuilt riders to protect you for various eventualities.

Monetary factors: For traditional plans, an important factor to consider is the quantum of bonus declared by the company in the past. For unit-linked insurance plans (Ulips), you must also consider the fund’s performance history and its risk-return profile.

It is important to note that new Irda regulations have made most life insurance products more or less similar. Therefore, a key differentiator would be ‘service delivery’ of the insurer. You could look at the company’s records in managing the entire customer life cycle. The other important service differentiator is ‘claims’. A claim is a moment of truth when the family of the policyholder is in distress due to an unfortunate incident in their lives and it is important that the company you choose has a good record in claim settlements.

Therefore, price should not be the only factor for choosing an insurance plan, where benefits are realised in the long term and quite often, not directly by the person investing.

Follow IRDA guidelines on insurance policies

It is not unusual to see insurance-seekers as well as those who have bought policies to rely heavily on their insurance agents for advice and help regarding operational issues. Insurance companies, therefore, invest heavily in training and rewarding their agents.

On the flipside, however, there are agents who sell insurance on a part-time basis and drop out when the situation turns unfavourable, leaving policyholders in the lurch. This is especially true in the current scenario, where reduced commissions have made many to abandon their job as insurance agents.

The agent's job does not stop at selling a policy to you and delivering the documents thereafter. They are required to help you further with paying renewing premiums, arranging to get changes (like those of address) effected, exercising the switch funds option, top-ups, partial withdrawals, policy surrender as also guiding your dependants with the claims process in the event of your demise.

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If you happen to be one of those who have been left in the lurch by an agent, you need not be disheartened. Remember, your agent is just an intermediary between you and the company, and you can always go straight to your insurer to get any issue resolved. Besides, the Insurance Regulatory and Development Authority (( IRDA)) has put in place detailed guidelines for handling such 'orphan' policies.

If the agent closes shop, the insurance company is under obligation to assign an official or another agent to service the policy and offer help to such policyholders. Typically, insurers transfer the servicing of such orphaned policies to their in-house cells set up specifically for the purpose. The policyholder will not be affected much in such cases. The insurer informs them about the change, asking them to get in touch with the company directly if the need arises.

Things could be a bit complicated if your agent happens to be your bank that acts as a bancassurance agency channel for your insurer. If the bank and the company decide to sever ties, the former may stop servicing your policy. Again, it's the insurer's responsibility to take charge of such policies and its call centre will become your point of contact.

This apart, there could be a situation where you voluntarily wish to dissociate yourself from your agent due to poor quality of services. In such a case, you can bring this to the notice of your insurer who may decide to take over the servicing of the policy or assign the job to another agent. However, there is very little scope of you getting a new agent as companies usually do not accede to such requests.

High sum assured may not give enough cover

The policy, as the name suggests, provides term insurance to senior citizens.The minimum and the maximum entry age are 50 and 85, respectively. Though the product offers a whole life cover, it does not ask buyers to undergo medical tests. The premium paying term, though, will end at age 90.

The company offers a maximum sum assured of Rs 5 lakh. The minimum sum assured is as low as Rs 2,338. Both these apply only two years after the policy has been bought. If the policyholder dies before two years, the dependents will be paid 125 per cent of the total premium paid till date.

But despite the bonus of 25 per cent over the premium paid, the product is expensive, as compared to other term plans available. The annual premium for a 50-year male seeking maximum cover under IDBI’s Termsurance Seniors Insurance Plan is Rs 18,195. If the same cover is bought at the age of 85, it will cost Rs 213,890. The same person can buy a 10-15 year simple term from other insurers at Rs 6,000 annually.

However, there are differences in the features offered by the senior’s insurance plan that make it difficult to compare the product with other term insurance in the market. The maximum entry age for most term insurers is 65 years and they do not extend cover beyond age 75. Also, no term insurer gives a whole life cover.

Those available today are offered by traditional and unit-linked insurance plans. While the waiver of medical tests is allowed by insurers, especially for the smaller sum assured of Rs 5-10 lakh, buyers in the 60-plus age bracket have to go through with it.

The company has positioned the product for people nearing retirement and with inadequate insurance to support kin after their demise. Experts feel senior citizens opting for the policy would require an income stream even after retirement.

If the buyer opts for the minimum sum assured at the minimum entry age of 50, where he needs to pay premiums as low as Rs 1,000 annually, the amount still might not suffice. This may limit the number of takers for the product, unless it is targeted at those in the lower income bracket.

Bharti AXA Life Insurance launches Monthly Income Plan

Private insurer Bharti AXA Life Insurance today launched a traditional participating money-back plan - 'Bharti AXA Life Monthly Income Plan'.

"Bharti AXA Life Monthly Income Plan is the first regular monthly income product in our portfolio. This is in line with our brand positioning of 'Jeevan Suraksha ka Naya Nazariya' that has customer centricity and trust at its core," company Chief Marketing and Operations Officer Mark Meehan said in a statement issued here.

From a financial perspective, he said, a supplementary income can help bridge the gap in meeting the intended goals.

Bharti AXA Life Monthly Income Plan guarantees the policyholder additional monthly income.

The plan also provides the policyholder with life cover, financially protecting the nominee, in case of the unfortunate death of the policyholder.

The private life Insurance company is a joint venture between Bharti Enterprises and AXA, leading financial protection and wealth manager.

Why do claims get rejected? How to avoid rejection of my claim?

According to the Insurance Regulatory and Development Authority (Irda), of the 7.62 lakh life insurance claims filed in 2009-10, nearly 15,000 were rejected by insurers. Meaning 15,000 families were denied the money that the policyholders had thought would reach them if they died! So you see numerous life insurance claims are rejected on various grounds and this articles is going to help you avoid rejection of your claim.

Firstly invest in an insurance policy and secure yours and your family’s future. You can avail of many offers available online that suit your purpose and benefit you.

The rejection ratio (rejected claims as a percentage of the total claims received and pending during the year) of some companies, especially those which started operations a few years back are very high. Namely, Aegon Religare rejected 45% of the claims, Future Generali, IDBI Federal and DLF Pramerica rejected one of every fifth claim raised (20%) whereas LIC has a rejection ratio of 1.1%.

This does not mean that one should not buy insurance from new insurance companies as claim settlement ratio or rejection ratio does not give the complete picture. Many a times the claims are rejected because the insurance company believes that pertinent facts were deliberately suppressed by the policyholder at the time of buying the cover.

An insurance company sizes up the risk of covering an individual on the basis of his health, medical history of his family, income, occupation and existing insurance cover. And based on the information disclosed the risk is properly assessed and priced accordingly. If an insurance company has reason to believe that any information pertaining to these parameters was suppressed, it can reject the claim.

Make sure you inform the agent that he is not really doing any favor if he deliberately overlooks any health problem or fills the form incorrectly as in the long run you would suffer as your claim will be rejected on grounds of non-disclosure of the pre-existing ailment.
This is especially true in case of low value insurance policies. Before they sell a policy, insurance companies subject the buyer to a range of medical tests.

Try not to rely on agents and fill the application form yourself. Ask him if you get stuck, but try and do it yourself. Just in case you are unable to fill it yourself go through the form after the agent has filled it up and then only sign it. Also retain a photocopy for your own record.

When you get the policy document and a photocopy of the form that you filled up, match it with the copy you have. This will ensure that all the information given in the form is correct.

Do not hold back any information relating to your health and family medical history.
Even disclose facts like use of tobacco and alcohol consumption.

Contrary to popular perception, a rigorous medical test actually helps the buyer. Because if a company gets the tests done, it rules out the chances of the claim being denied on account of preexisting diseases.

State correct age, occupation, income and other insurance cover. Your age defines the risk, so any inaccuracy can lead to rejection.

If your work profile involves risk, give the true picture.

Don't overstate your income so that you can buy a large cover.

Check the policy document carefully and notify the insurance company if there is any inaccuracy. In case of minor changes, the insurance company will simply send a letter confirming the new issuance terms. But if there are material changes which have a bearing on the original terms, the buyer may be asked to undergo additional medical tests to ensure that the risk cover continues.

Submit genuine documents like copies of your PAN card, identity proof, birth certificate and other such documents at the time of buying a policy.

Last, but not the least, pay your premium by the due date so that your policy does not lapse. Make use of the 15-30 day grace period for paying the premium, but don't bank on this.

ING Life Insurance ties up with Vizag co-op bank

ING Life India, part of the ING Group, has tied up with Visakhapatnam District Central Co-op Bank in Andhra Pradesh.

The tie-up gives access to ING Life India to make its products available to more than 60,000 customers of the co-op bank through its 28 branches spread across Visakhapatnam, Anakapalli, Narsipatnam and Yelamanchili.

Commenting on the tie-up, T K Uthappa, director - sales, ING Life India, said, “ING Life India has a strong network of tie-ups with co-operative banks across India. We have been keen to develop our network in Andhra Pradesh, and this tie-up gives us the right start in the region to reach out to our customers to help them manage their financial future.”

Visakhapatnam District Central Co-op Bank is the fifth district central cooperative bank that the company has tied up with in AP.

B Satya Rao, chairman, Visakhapatnam District Central Coop Bank, said, “With the tie up we will now be able to add one more service to our customers by offering life insurance products.”

What is not covered under your Insurance Policy?

The best way to avoid any surprises at the time of medical emergency is by being prepared. Fore warned is fore armed! All you need to do is carefully go through the insurance policy document when it arrives and not when your claim is rejected. Being aware of what your policy does not cover is as important as knowing what it does. Increasingly, insurers are also imposing limits on room rent and operation theatre charges, even if the total claim is within the extent of coverage. Therefore, it is critical to understand at least three clauses (pre-existing illness being the third) in your health insurance policy.

Exclusions: Is any illness, condition or expense that is spelt out in the policy as being specifically out of the scope of coverage. For instance, most policies do not entertain claims during the first 30 days from policy inception, barring the ones that are accident-related.
• Preventive care, vitamins and tonics and the cost of pacemakers and wheel-chairs are usually not reimbursed.
• Same is applicable to expenses relating to maternity, dental treatment, outpatient department (OPD) and diagnostic tests (that are not linked to hospitalization). However, some policies do cover some of these expenses.
• Amongst ailments, cataract and piles are not covered in the first year. However, if the insured has to undergo medical tests in connection with an upcoming surgery, the same will be covered and so will be the medicines administered during the period. These could be claimed separately as pre-hospitalization expenses.
• A majority of health policies cover expenses up to 30 days prior to hospitalization and 60 days after discharge.
Sub-limits: All charges including room rent are reduced in proportion to the room rent cap. This is primarily because the charge structures levied by hospitals varies as per the type of room chosen by you. This apart, the claim that is finally disbursed to you could be in great variance to what you have estimated, due to another clause: reasonability. If the insurer is of the opinion that you have paid say `1 lakh for a treatment that generally costs `80,000, only the latter amount will be sanctioned.

Auto Insurance Policy | Common Exclusions

The insurance policy jargon is such that most of us find it difficult to understand. In fact it is not surprising, that many people don’t even fully read their insurance policy. The reason is that all standard insurance policy contracts are long, boring, confusing, and actually, misleading. For example, in many cases a coverage is excluded in one section, only to be added back later on in the policy. It can get frustrating, that you need a lawyer or an expert, to help you understand what exactly is covered.
There are few common misconceptions about what is and what isn’t covered in an insurance contract, which can be cleared by understanding the policy exclusions.
1. Delivery for Commercial Purposes: If you pick up a job delivering pizzas a few nights a week, there will be no coverage from your personal auto insurance, if you happen to get in an accident while delivering. Commercial deliveries are excluded from the standard personal auto insurance policy.
Always check with the company you are working for, to see if they have a commercial auto policy, that will cover you, while you make deliveries.
2. Company Vehicles: The insuring agreement of personal auto policy excludes, “coverage for the use of a vehicle furnished or available for your regular use.”
For instance: Your employer supplies you a company vehicle. Suppose your spouse also has a car of their own, which is insured under a personal auto policy, which you are named under. If your spouse were driving your company car, she has no coverage under the commercial auto policy.
3. Vehicles not Considered Autos: Auto insurance doesn’t cover all things with a motor. Typical exclusions include boats, four wheelers, motorcycles, go carts, and golf carts.
Before adding this on to your auto policy, first check with homeowners insurance, to see if it’s covered through your policy. In most cases, you have to add a special endorsement, either to your home or auto insurance, or buy a separate policy.
4. Personal Contents: The gadgets we carry in our cars today are not cheap. The combined cost of even a cheap cell phone costs, your CD collection and iPod, you’re easily approaching Rs20, 000 of personal contents in the car. Unfortunately, if someone were to break into you car and steal these items, none of that is covered under your auto insurance policy.
However, personal contents are covered under your home/renters insurance policy.
Endorsements to Insurance Contracts: All of the above are excluded from the standard insurance contract. That doesn’t mean that individual carriers, can’t add them back in. Adding coverage to a policy is called an endorsement.
The next time you’re reviewing your insurance agreement, check to see what your policy is endorsed for. There are a lot of special perks, the better insurance companies will give, that often go unnoticed.
To conclude: It is a good practice to read your insurance contract. Set aside just a few minutes of your time, to get through your auto, home, life, and health insurance contracts. It is bound to prove beneficial and you will definitely learn a lot.

Reasons for cancellation of an Insurance Policy

There has to be a very good reason for an Insurance company to cancel a policy. The top five reasons for having your policy cancelled are discussed below:
1. Failing to pay on time.
The first and most obvious reason for cancellation would be failing to pay or paying late. This applies to all types of insurance. Each state has rules governing when an insurance company may drop your policy. Grace periods will also vary depending on which line of insurance you purchase (health, auto, home, life) and which insurance company you choose. Some car insurance companies may seize the opportunity to drop you if you’re only a few days late – especially if you're habitually behind on payments. However, many insurers value your business and won't drop you if you're a few days late.
Advice - Pay your bills on time. This usually means your premium must be received by the due date. Dropping the payment in the mail on the due date may not be good enough. If you’re worried about being late on your payments, check with your insurance company about its grace period. If you've been cancelled by your car insurance company, it may require that you to pay the balance due for the full term before they reinstate your insurance.
2. Falsifying the truth.
If you knowingly tell lies to your insurance company, it has the right to cancel your policy. To an insurance company, it’s bad business to give you a lower rate for lying. For example, lying to your auto insurer about the number of miles you drive annually can be cause for cancellation. Some insurers may simply increase your car insurance rates for this particular lie, but they can also cancel your policy and refuse to pay your claim — assuming you provided inaccurate information intentionally.
Life insurance companies may also cancel your policy if you lie. For example, if you lie about your deep-sea diving hobby and then die during a dive, your life insurance company could deny your beneficiaries’ claim. Any lie caught within the two-year contestability period of a policy can provoke the insurer to scale down the death benefit or even rescind the policy, depending on state law.
Advice - When applying for any type of insurance ‘honesty is the best policy’.
3. Your driver’s license has been suspended or revoked during the policy period
If your auto insurance company finds out that your license has been suspended or revoked, it will cancel your policy. This rule also applies to other members of your household. For example, if you have a child listed on your policy who has had his or her license revoked/suspended, your insurance company may cancel your policy if you fail to disclose this information. Car insurance companies often check your DMV record (and that of other members of your household) at renewal time. They will also find out about a license suspension if the person in question is involved in a car accident.
Advice - If someone in your household experiences problems with their license, notify your insurer. Your policy will not be cancelled (unless you’re the culprit). Your insurer may simply exclude coverage for that person.
4. You ignoring telephone calls from your insurance company
Ignoring your insurance company is never a good idea. If your insurer makes an effort to contact you – especially during a claims-settlement process – you’re obligated to comply. For example, if you get into a car accident, your insurance company will surely want to interview you or may even require you to attend a deposition if a lawsuit is involved. Failing to comply could be grounds for policy cancellation. A standard car insurance policy states that the insurer has “no duty to provide coverage” unless the insured is in full compliance with a number of duties. These include promptly notifying your insurer where, when and how the accident happened. A standard policy states that “a person seeking coverage must cooperate with us in the investigation, settlement or defense of any claim or suit” and “promptly send us copies of any notices or legal papers received in connection with the accident or loss.” This can include exams by physicians and medical records.
5. You commit suicide
Generally, life insurance policies have a contestability clause that says, among other things, the policy will not pay out if you commit suicide within the first two years of the policy. However, if you commit suicide two years and one day after you purchase the policy, your beneficiaries will be paid!

2 New ULIPs & 2 Traditional products launched | DLF Pramerica Life

Private sector insurer DLF Pramerica Life Insurance launched four new insurance products, which include two traditional plans.

The traditional non-linked products
1. DLF Pramerica Assure Money Plus - provides minimum guaranteed earnings on maturity along with the advantage of high life insurance cover
2. DLF Pramerica Tatkaal Suraksha Gold
Both provide saving as well as protection.

Besides, it also launched two unit linked products namely
1. DLF Pramerica Wealth Plus Premier - is a good product for high net worth individuals seeking potentially high investment returns along with a well secured future for the family in case of any eventuality
2. DLF Pramerica Ezee Wealth Plus with simplified underwriting.

About the Company:-

DLF Pramerica Life is a joint venture between real estate company DLF Ltd and the US-based Prudential International Insurance Holdings.

The company became operational in September, 2008 and currently has 30 offices across Delhi NCR, Haryana, Punjab and Gujarat.

Insurance: Non-life business now enters development stage

After playing second fiddle to the life insurance industry for several years, the non-life business has roared back into growth mode. In the first six months of the current fiscal, the industry has recorded 23% growth and there are signs that profitability has improved as well.

“In a stable price environment, the non-life industry should grow by 2-2 .5 times the rate of GDP growth. What we are now seeing is some stability in pricing coupled with opening up of hitherto untapped sectors because of government schemes like the Rashtriya Swastha Bima Yojana,” said ICICI managing director Bhargav Dasgupta .
The growth rate in the first half is almost twice the 13% growth recorded in the whole of 2009-10.

The last time the non-life industry saw such growth was in 2005-06. After that, the insurance regulator freed pricing on all lines of businesses which led to a fall in prices. While the reduction was as high as 80% in the property insurance, the competition also ensured that prices of health and motor insurance — the fastest growing segments were kept under check despite high claims ratio.

“Pricing has improved in health, but in parts of motor insurance, it continues to remain very competitive,” said Mr. Dasgupta. What has kept the price war alive was the continuous entry of new players in the market who were willing to sacrifice margins to build up an underwriting book.

For the first half of the current fiscal, private insurers have recorded total premium of . 9,204 crore against. 7,312 crore in FY10 — recording a growth of 25.9%. Stateowned insurers have collected total premium of . 14,500 crore in the first half of FY11 against . 11,184 crore in the previous year — resulting in a 21% growth.

While health insurance continues to be a major driver of growth — with a 40% rise in health premium in the first half of FY11, all other segments, barring property insurance have recorded a healthy growth. Health insurance today accounts for more than one-fifth of total premium in the country.

Aviation insurance, which has seen some price hardening, coupled with an increase in fleet size, has grown by 40% in the first half. Marine Cargo, which is a reflection of trade in goods, grew 26.3%.

Among companies, HDFC Ergo continues to be one of the most aggressive growing by 49%. ICICI Lombard General Insurance — leader among private companies — has grown 32%. Tata AIG General has also managed a 33% growth despite its foreign parent’s troubles internationally.

Reliance General Insurance , which is currently in merger talks with Royal Sundaram General Insurance is the only private insurer to have shown a drop in premium income (-24 %).

How to find cheap auto insurance?

YES, Cheap Auto Insurance is possible. But getting it cheap is synonyms with little extra work to take advantage of savings that aren't always advertised. Here is heads up to what you need to know to find the best deal on auto insurance:
Shopping ability
If you want to cut down your insurance costs, you need to do two things;
1. Understand exactly how much coverage you need. The question is how much you'll pay for coverage in these three categories:
a. Bodily injury liability for a single person,
b. Bodily injury liability for all injured parties and
c. Property damage liability.
2. Compare before you shop. When it comes to getting the best deal on your auto insurance, you have to compare auto insurance quotes. You can use online calculators available on www.bimadeals.com to streamline your search as well as reach out to our customer care representatives for a quote.
Cut costs
There are various ways to save on auto insurance but nothing beats to cutting costs. How?
• You can raise your deductible, but the downside is that you'll pay more out of pocket after an accident.
• Or reduce your coverage. You don't want to go below your state's minimum guidelines, but if you're looking to save, you need to ask if you're overvaluing your assets and the coverage you need.
• You may want to drop some coverage altogether. It may not add up to much, but you may not need coverage that provides rental car and towing coverage.
Look for discounts
Yes, its true the key to cheap motor insurance is to maximize discounts. Insurers have been known to offer discounts based on the type of work you do, your driving record and whether you're married. Insurers also offer discounts for those who pay their yearly premium in full, and there's usually a discount for insuring more than one vehicle on the same policy.

So, follow these basic tips and get the cheapest auto insurance easily.

Is it possible to increase life insurance policy?

You could have numerous reasons to want to increase your life insurance coverage. Namely,
• If your insurance does not provide for growing inflation
• It could be due to a growing family,
• New job
Above mentioned could thereby require more insurance in order to keep up their quality of life.
For the above mentioned reasons you could be interested to expand your life insurance coverage. In order to do this firstly, it is important to consider how much life insurance you need.
Experts advise that ideally a life insurance policy worth should be roughly eight or 10 times the holder's annual salary. Thus, if you wish to expand your coverage then you could purchase an appropriate policy easily.
But you should bear in mind of how the cost of life insurance increases as you age, as well as various other factors.