Tuesday, December 21, 2010

Insurance is foresight not hindsight

HINDSIGHT is always a great thing. It explains, in a lot of situations, what foresight could have prevented.

How often do we hear people saying, "Oh, if only I had bought a home before prices surged!" or "Why didn't I sell those shares at their highs?"

Oddly this retrospective insight into our human frailties doesn't seem to help much where the insurance industry is concerned.

The apartment complex blaze that killed at least 58 people in Shanghai on November 15 is a case in point. It turns out only a handful of residents had insurance policies covering their homes and contents. Insurance compensation can't bring back the life of a loved one, but it can go a long way in staunching the kind of material losses almost all of the families now face.

The combined property losses of the reported 156 families living in the building have been estimated at 500 million yuan (US$75.2 million), based on the average market price of 30,000 yuan per square meter for residential space in the area, said earlier media reports. By November 23, insurers in Shanghai paid more than 8.3 million yuan in claims related to the fire, according to the Shanghai Bureau of the China Insurance Regulatory Commission, the nation's top industry regulator.

Of the 8.3 million yuan, 5 million yuan came from a publicly financed community insurance fund, indicating the low penetration of the private insurance sector.

Life, property and casualty insurance is still a relatively new concept in China. I still remember the sneer from one of our business reporters, a frequent flier, who was asked if he bought flight insurance. "What's the use of money if one is dead?" the reporter replied.

That misses the point. Insurance aims to provide relief for survivors in case of death.

I did a quick, informal survey among 12 colleagues on the subject of buying insurance. Only one said he has insurance to protect his family from "the uncertainties of the future."

"I bought insurance to cover illness, pension and accidents," said the 30-year-old married guy, whose monthly salary is around 7,000 yuan. "I don't want my family to suffer a deteriorating quality of life if anything happens to me."

The other 11 all said they had no insurance at all, including a reporter covering the insurance industry.

"My own experiences showed me that insurance agents are always quick to boast about all the things they can offer when they are selling policies, but when it's time to file a claim, it's a tedious and complex process to try to collect on any of those promises," said the mother of a three-year-old boy, recalling her unhappy experiences when she claimed reimbursement under the employer's group medical policy.

Difficulty in claiming compensation, the lack of third-party agencies to provide an impartial guide to insurance products and lack of trust in insurance professionals have topped the list of why my colleagues aren't rushing out to buy insurance.

Hu Shi, the esteemed Chinese philosopher and essayist who died in 1962, once said that insurance is to prepare for tomorrow today, prepare for death while one is still alive, and prepare for children when you're parents.

His wisdom seems to be particularly well received by the well-off.

It appears the more money you have in China, the more you are aware of insurance protection. Buying protection to cope with major diseases, protect pension funds and savings, and guarantee enough money for children's education top the list of needs when the wealthy consider their risks, according to a survey conducted by HSBC Life Insurance Co.

The survey centered on people in Shanghai, Guangzhou and Beijing who had financial assets of 500,000 yuan or more.

Thus, a dilemma: the most vulnerable are the least concerned about financial protection. In many instances, lower-income families just can't afford to face another cost, especially during a period when high inflation is already eroding household spending power.

"For the rich, the main concern is protecting their wealth; for the poor, the main concern is how to increase their wealth," said a former Shanghai retail banking officer now working in the news media.

The insurance sector in China is still small by comparison with the nation's huge economy and population. Since China embarked on its market reform and opening-up policies three decades ago, sea changes have occurred. China is now the world's second-biggest economy after the United States, and family incomes are rising rapidly.

The financial sector, too, is growing by leaps and bounds. But insurance professionals in China still lack the prominence of their counterparts overseas.

In China, insurance agents are often treated like salesmen peddling milk. Insurance industry personnel complain that their salaries are nowhere near those of bankers or securities brokers.

True, China's insurance industry is growing almost three times as fast as the economy at large, but that gain comes from a very small base in a country with 1.3 billion people.

In the first three quarters of this year, insurers in China pulled in premiums totaling 1.13 trillion yuan, up 32 percent annually. In the same period, China's economy surged 10.6 percent to 26.8 trillion yuan, giving an insurance penetration of only 4.2 percent. Actually, the insurance industry is growing ahead of the government's forecasts.

China's 11th Five-Year Plan, which ends this year, envisioned insurance premiums per capita doubling and contributing to 4 percent of gross domestic product.

Per capita premiums are forecast to reach 750 yuan this year, compared with just 367 yuan, or 2.7 percent of GDP, in 2005, according to data compiled by Swiss Reinsurance Co.

China is also ahead of its five-year target to triple domestic insurance assets to 5 trillion yuan by the end of this year and to more than double premiums to 1 trillion yuan.

The potential of the market is tantalizing to overseas insurers. However, many of them have held back because their operations in China are restricted and their returns on investment poor, an industry survey by PricewaterhouseCoopers found in late November.

Foreign insurers continue to find China a tough market to operate in, said the PwC report. Regulations, shortage of professionals and fierce competition from domestic insurers are cited as stumbling blocks, according to the survey. The accounting firm's survey covered 21 of the 28 overseas life insurers operating in China, and 10 of the 18 property and casualty insurers.

China is trying to encourage the growth of the domestic insurance industry to trim the government's burden in a cradle-to-grave social welfare system. The government also wants to expand the investment vehicles insurers are allowed to offer to help them earn higher returns and prepare for the future needs of a burgeoning crop of middle-class customers.

China introduced its modern insurance law in 1995, and the China Insurance Regulatory Commission was set up three years later to supervise the growing industry.

A healthy insurance industry can deepen attention to cutting risk exposure. I still remember how a risk-control officer at an overseas insurer said he won the trust of clients by advising a company to increase ventilation in an engine room and thereby cut risks of situations that might lead to claims.

Source:Shanghai Daily

Planning Ahead: Top 8 Life Insurance Mistakes (and How to Avoid Them)

Life insurance mistakes are common. Almost one-third of people in the U.S. carry no life insurance whatsoever, and millions more waste money by paying into a life insurance policy for years (appropriate or not) and then canceling the policy. Of those remaining, most buy insurance in amounts that simply do not match their needs.
So, what is a savvy life insurance shopper to do? How do you know how much life insurance you need and what life insurance mistakes should you avoid?

Read on: Top 8 Life Insurance Mistakes (and How to Avoid Them)
Source: www.creditloan.com

Monday, December 20, 2010

Life Insurance: Lost and Found

New centralized web-based service offered to life insurance policy holders to register and track insurance policies. Free to register and inexpensive to search for unclaimed or lost policies.

PRLog (Press Release) – Dec 17, 2010 – An easier way to track and find lost life insurance policies is now available to the general public. Any insurance policy holder can track their own policies in this new centralized database making it easier for beneficiaries to streamline the collections process. Founders of http://www.findyourpolicy.com, Michael and Edmund Hartmann were left to settle the affairs of their father’s estate after he died of cancer. They quickly became frustrated in attempting to research their father’s insurance policies. Not knowing which insurance company to contact and then not receiving adequate customer service seemed to make the process impossible. Michael and Edmund Hartmann decided to create a simple solution to keep track of and research insurance policies of loved ones. They have created a centralized database where insurance agents and individuals can register the policies for free. When it comes time to research the policies a nominal fee is charged to retrieve the information. A portion of this fee is donated to cancer research in honor of their father.

An estimated 1 out of every 4 life insurance policies go unclaimed each year for various reasons, the most common of which is misplaced policy information. Unclaimed life insurance policies are retained by the insurance companies until proper claims are made by the beneficiaries. If no claim is made then no payout is expected. It is the responsibility of the beneficiaries to submit claims. If the beneficiaries are not aware of who or where to make claims, it can become a very frustrating process, as experienced by Michael and Edmund.

To register is easy and free. The process requires basic information on the policy holder and the company name which holds their life insurance policy. A social security number or policy number is never required. Policy owners can always reenter the site for free to make any updates or changes as they wish, while loved ones looking for their information can retrieve it by searching the database for $9.95 (US). Thus avoiding the painstaking process of searching through over 1500 insurance agencies trying to find out which one held the policy. The simple, easy to use, centralized database provides peace of mind to policy holders by securely storing the information for later retrieval.

When it comes time to retrieve your information, www.findyourpolicy.com is very helpful even if you are not registered with them. First, if you are registered with them, then they will provide you with your stored information. You are also given instructions on what to do next. If for some reason your deceased loved one did not register with www.findyourpolicy.com, you will receive a 17-point checklist on what to do, a list of the top 100 insurance companies, and links to correct contact information within those companies. Plus you will receive instructions on a 5 step process on how to work with the insurance company and to make a claim. It is clear that keeping track of your valuable insurance policies is important. What better way than to secure it in an organized database. www.findyoupolicy.com will help them be able to quickly receive what you have been paying for.

Contact: info@findyourpolicy.com



Source: www.prlog.org

Insurance firm told to refund Rs 50K

CHANDIGARH: UT district consumer disputes redressal forum has directed Aviva Life Insurance to refund Rs 50,000 to the complainant along with Rs 10,000 compensation. The complainant, Surinder Kaur, a resident of Mohali alleged that she got a policy for Rs 50,000 issued from the respondents. As per the terms and condition, the refund could be claimed within the free look period of 15 days. The complainant requested the respondents to refund the amount within this period and returned the original policy to them. After several requests, the complainant received a letter on December 20, 2008, intimating that a cheque for Rs 49,950 had been issued in her favour. The complainant alleged she never received the cheque.

Initially, an advocate appeared on behalf of the respondents and the case was fixed for their reply and evidence. However, when no one turned up from the respondents? side the court started ex parte proceedings against them.

Forum stated that the complainant has not received the cheque sent by Axis Bank and the respondents have not responded to the notice issued to them, which proves that the cheque in question has not been credited to the complainant?s account. It seems that the respondents are well aware of the fact that the amount had been encashed by a third party, forum added.

Forum directed the respondents to refund Rs 50,000 to the complainant along with an interest of 12% per annum along with Rs 10,000 as compensation for harassment and the costs of litigation.

Source: timesofindia.indiatimes.com

Through Canada’s insurance loophole

Lynne Rae Zlotnik had insurance in her blood.

Her father, Harold, began selling policies in 1945 and eventually she followed in his footsteps. “Insurance,” Harold Zlotnik liked to say, “is the business of financing dreams.”

But when insurance regulators began looking into Vancouver-based Lynne Zlotnik Wealth Management Inc. this year – a firm she created in 2006 to sell life insurance and other investment products – they were troubled by what they found.

Several of her clients had invested a total of more than $1.4-million in her company on the promise of a lucrative return. The clients included 96-year-old Katie Sturhahn, who cashed out a $200,000 segregated fund, an investment fund that comes with insurance guarantees, and instead put her faith in the insurance agent.

It was a questionable financial strategy, since the payout on the fund – which she intended to leave her five children – was assured. Soon after the elderly woman died in March, the agent declared bankruptcy, and the money was gone.

“That was our inheritance,” says her son, 71-year-old Walt Sturhahn. “We’ve got none of it.”

But an even more disturbing discovery had yet to be made: When regulators went looking for someone responsible for overseeing such a risky financial transaction, there was no one to answer for it. The regular checks and balances that are designed to oversee an insurance agent had failed.

The insurance company that administered the policy had no direct oversight over Ms. Zlotnik. In a practice that is increasingly common throughout the industry, she dealt with a middleman company called a Managing General Agent, or MGA, which is an unregulated wholesaler of insurance products to independent agents that few consumers know about. That made it difficult for regulators to scrutinize her conduct.

Read on: Through Canada’s insurance loophole

Source: www.ctv.ca

Total premium of life insurance sector rises 23% in H1

Looking at the article just below this I was bit worried.. at least this article shows some ray of hope...

Despite an uncertain environment, the total premium of life insurance industry increased by 23 per cent to Rs 1,25,254 crore, from Rs 1,01,973 crore for the first six months of the current fiscal.

Read on: Total premium of life insurance sector rises 23% in H1
Source: www.thehindubusinessline.com

Life insurance cos cuts loss by 80%

The 23-player life insurance industry in the country made a total loss of Rs 988.82 crore in the financial year 2009-10, according to the latest annual report of Insurance Regulatory Authority of India (Irda). But the more pertinent point is that the industry has reduced its loss by a whopping 80 per cent from net loss of Rs 4,883 crore in 2008-09.

Read more on: Life insurance cos cuts loss by 80%
Source: www.deccanherald.com

Wednesday, December 15, 2010

Message from Mindtree Executive Chairman to his employees

Email from Mindtree Executive Chairman Ashok Soota to his employees.
Pretty interesting.....

(Thank you Narasimhan for sharing this)

Dear MindTree Minds,

Points on How to Improve Your Life

Many of you may be aware of the speech given by Randy Pausch entitled “Guide To a Better Life”. He had been diagnosed for cancer and when he made this wonderful speech, he knew that he had been given only a finite span to live. I am reproducing below the extract from the speech which gives 30 valuable lessons for all of us.


1. Don't compare your life to others'. You have no idea what their journey is all about.
2. Don't have negative thoughts of things you cannot control. Instead invest your energy in the positive present moment
3. Don't overdo; keep your limits
4. Don't take yourself so seriously; no one else does
5. Don't waste your precious energy on gossip
6. Dream more while you are awake
7. Envy is a waste of time. You already have all you need.
8. Forget issues of the past. Don't remind your partner of his/her mistakes of the past. That will ruin your present happiness.
9. Life is too short to waste time hating anyone. Don't hate others.
10. Make peace with your past so it won't spoil the present
11. No one is in charge of your happiness except you
12. Realize that life is a school and you are here to learn. Problems are simply part of the curriculum that appear and fade away like algebra class but the lessons you learn will last a lifetime.
13. Smile and laugh more
14. You don't have to win every argument.


15. Call your family often
16. Each day give something good to others
17. Forgive everyone for everything
18. Spend time with people over the age of 70 & under the age of 6
19. Try to make at least three people smile each day
20. What other people think of you is none of your business
21. Your job will not take care of you when you are sick. Your family and friends will. Stay in touch.


22. Put GOD first in anything and everything that you think, say and do. 23. GOD heals everything 24. Do the right things 25. However good or bad a situation is, it will change 26. No matter how you feel, get up, dress up and show up 27. The best is yet to come 28. Get rid of anything that isn't useful, beautiful or joyful 29. When you awake alive in the morning, thank GOD for it 30. If you know GOD you will always be happy. So, be happy.
To the above, I would add:

31. Never do something which you would not like to see in newspaper headlines.
32. “When you say something you shouldn’t have said – something that you didn’t mean or that was unkind – apologize right away. The longer you wait the harder it will be.” Many of you will recognize this as a quote from the “Thought of the Day”. Subroto describes it very well in his book when he says that in most instances the hurt caused is unintended, but for the person who feels the pain it is real.
33. We need an optimistic approach to life. I am a strong believer that things will invariably work out for the greater good of all concerned and it is an attitude to have whenever things don’t appear to be going the way we would like (Point 27 flows from above).

On a lighter side, please see No.18 of Randy’s points. In a couple of years from now, you will be able to fulfill one half of this by meeting me now and then!

Hope these points help you to lead a happier and more contented life.



Monday, December 13, 2010

LIC pension funds — IRDA clarification

The recent clarification by Insurance Regulatory and Development Authority Chairman that the Life Insurance Corporation of India did not break any rules and certainly it would not transfer money from one account to another in violation of the existing guidelines had brought cheers to millions, but it left them also wondering. “What is meant by transfer of money from one account to another? Why it is not permitted and does this restriction apply to LIC? To answer these questions, one has to understand the structural difference between LIC and private insurance companies.

Read on the complete article: LIC pension funds — IRDA clarification
Source: www.hindu.com

Life insurance ‘protection gap’ revealed

First it was observed in US ... now in UK..
More than half of UK adults have no life insurance policy in place, according to new research – despite the fact that two thirds of the people who took part in the survey had financial dependents.

Read on: Life insurance ‘protection gap’ revealed
Source: www.which.co.uk

Sunday, December 12, 2010

U.S. life insurance lowest in 50-years

... and I was under impression that since there are now more avenues of "knowing" what exactly life insurance is about and how does it helps, the overall awareness and sales would increase!
Study by LIMRA proved me wrong!!

Read on: U.S. life insurance lowest in 50-years

Source: www.todaysthv.com

More benefits for paid-up life insurance

An article with good example of paid-up life insurance.

By way of review, a person who has owned a cash-value life insurance policy for a while can choose to stop paying the premium, maintain the cash value, and accept a guarantee that the insurer will pay a reduced death benefit whenever the insured dies in the future. The policy is thus paid-up.

Read on more on: More benefits for paid-up life insurance

Source: news.cincinnati.com

Thursday, December 9, 2010

Bharti AXA Life launches Aajeevan Anand

NEW DELHI: Private sector insurer Bharti AXA Life Insurance today launched Aajeevan Anand plan that provides guaranteed regular payouts after every 5 years and life cover until the age of 100 years.

"Aajeevan Anand is a powerful financial solution that provides guaranteed regular payouts to meet various life stage needs until the age of 100," Bharti AXA Life Chief Marketing and Operations Officer (CMOO) Mark Meehan said.
In addition to these lifelong paybacks, the product provides customers with life cover and hence is an ideal savings cum protection plan, he said.

This whole life plan is apt for salaried people since all premium payments are made in the first 10-15 years of the policy, he added.
The nominee of the policy holder would get sum assured in case of death during the policy period which is 100 years.

Bharti AXA Life is 74:26 joint venture between Bharti Enterprises and AXA of France.

Source: http://economictimes.indiatimes.com

GEICO Releases Windows Phone 7 App

At the end what matters is the customer service... With the release of Windows Phone 7 app, GEICO is now several steps ahead of its most of the competitors in terms of customer service.

Chevy Chase, Md.-based P&C carrier GEICO has released a version of its GloveBox mobile application for Microsoft's recently released Windows Phone 7 mobile OS. The GloveBox app for policyholder services is already available for iOS and Android. “The application for the Windows Phone 7 was created to provide a great customer service experience as well as ease of use for our policyholders," Dave Weaver, manager of mobile applications for GEICO, says in a statement.

GloveBox allows GEICO policyholders to bills, access ID cards, record accident information, reach the carrier by phone, view videos and TV commercials and access the company's social media pages. It is also available for Apple's iOS, which powers the iPhone and iPad; as well as Google's Android mobile OS. Esurance launched a Windows Phone 7 app earlier this year.

Source: www.insurancetech.com

Wednesday, December 8, 2010

IRDA Warnings and Penalties

List of IRDA(Insurance Regulatory and Development Authority) Warnings and Penalties issued to Life Insurance Companies in India.

Read On: IRDA Warnings and Penalties

Source: www.irda.gov.in

Life insurance applications decline for sixth straight month

U.S life insurance application activity fell slightly in November, marking the sixth straight month of declines.

The monthly MIB Life Index found that application activity for individually underwritten life insurance declined 1.6% in November compared to the same month in 2009.

So far this year, declining months have outnumbered gainers, 8-3, with the last gains coming last January and March.

Because of the declines, the January-November period shows a 1.2% decline from 2009.

On the bright side, November’s activity exceeded October’s numbers by 2.1%, making it four straight months of monthly increases.

The age 60 and above age group showed the best numbers, with a 6% increase over November 2009. Ages 0-44 filed 3.4% fewer applications, while people age 45-59 filled out 1.5% fewer applications than in November 2009, according to the index.

Source: ifawebnews.com

Google Gets U.S. Government Cloud Contract

Google or Microsoft .. Google or Microsoft .. Google or Microsoft ..
..... and the contract goes to Google!!!

Here is the news -

* Google wins contract to provide email to federal agency
* Google poses threat to rival Microsoft's pricing-analyst

The U.S. General Services Administration awarded a five-year, $6.7 million contract last week to Unisys Corp , with Google as a subcontractor -- a relatively small dollar amount but an important initial foothold.

Read on: Google Gets U.S. Government Cloud Contract

Source: www.insurancetech.com

Tuesday, December 7, 2010

Financial Institutions and Social Media

In the span of a few short years, social websites such as Facebook, YouTube and Twitter have attracted millions of users. Today, three out of every four global consumers who go online visit social networks or blogs and the average visitor is spending two-thirds (66 percent) more time on these sites than a year ago.1 The use of social websites has become a part of many consumers’ everyday lives, making them a channel financial institutions can no longer ignore.

Read on the complete white paper on : Financial Institutions and Social Media

Source: www.fiserv.com

Monday, December 6, 2010

Gartner Identifies Top 10 Strategic Technologies for 2011 in Insurance space

Here is the top 10 list, with some of Gartner's analysis of the impact of these developments:

Cloud Computing -- "Gartner expects large enterprises to have a dynamic sourcing team in place by 2012 that is responsible for ongoing cloudsourcing decisions and management."

Mobile Applications and Media Tablets -- "Gartner estimates that by the end of 2010, 1.2 billion people will carry handsets capable of rich, mobile commerce providing an ideal environment for the convergence of mobility and the Web."

Social Communications and Collaboration -- "By 2016, social technologies will be integrated with most business applications. Companies should bring together their social CRM, internal communications and collaboration, and public social site initiatives into a coordinated strategy."

Video -- "Gartner believes that video will become a commonplace content type and interaction model for most users, and by 2013, more than 25 percent of the content that workers see in a day will be dominated by pictures, video or audio."

Next-Generation Analytics -- "It is becoming possible to run simulations or models to predict the future outcome, rather than to simply provide backward-looking data about past interactions, and to do these predictions in real time to support each individual business action."

Social Analytics -- or, "the process of measuring, analyzing and interpreting the results of interactions and associations among people, topics and ideas."

Context-Aware Computing -- defined as "the concept of using information about an end-user or object's environment, activities, connections and preferences to improve the quality of interaction with that end user."

Storage Class Memory -- As flash memory proliferates, "Given the cost premium, simply building solid state disk drives from flash will tie up valuable space on all the data in a file or entire volume, while a new explicitly addressed layer, not part of the file system, permits targeted placement of only the high-leverage items of information that need to experience the mix of performance and persistence available with flash memory."

Ubiquitous Computing -- or, "the coming third wave of computing where computers are invisibly embedded into the world."

Fabric-Based Infrastructure and Computers -- defined as, "a modular form of computing where a system can be aggregated from separate building-block modules connected over a fabric or a switched backplane."

Source: www.insurancetech.com

Insurance Companies are spending on Document Capture technology

According to a study done by a market analyst firm, insurance companies are spending more on document capture as compared to last year. This include investing in technologies/hardware like scanner, OCR and intelligent document recognition software.

The growth in insurance spending largely can be attributed to more property and casualty insurers investing in document capture solutions, says Harvey Spencer, the East Northport, N.Y.-based firm's president. "P&C is becoming more important" to the document capture market, he relates, noting that a growing number of carriers are adopting transaction, or in-process, document capture. "These carriers are beginning to recognize the importance of acquiring information at the point of capture," Spencer comments.

"More value is being moved to the capture process from the back-end process. If you can start understanding documents at the point of capture, you can process them more easily," Spencer explains. "Truncating at the point of creating or acquisition of a document is key. The longer something exists as paper, the more risk you run of someone changing it or copying it -- then you can't process it as efficiently."

Source: w

Sunday, December 5, 2010

December 2010

Well Friends... New year is just around the corner and it's now time to tick off all the new year's resolutions you made last year :) . Seems like an awkward situations right ?!!

Don't worry, we still have 26 more days to go... and if you are really serious about the resolutions you made last year and want to keep them no matter whatever it takes, it is time to show the world/yourself what you are capable of.

Two things mentioned above are worth introspecting...(and I have started realizing it myself as I write)

1. Is putting efforts in these last 26 days of year would resolve this real problem ? Wasn't the real issue more related to - making and following the schedule, making it as a habit, doing things on on-going basis.. ? Just by putting all the efforts at the end, would it really solve the underneath problem (of being lethargic, lazy) ?

2. Are the resolutions made for the world or for yourself ? Do you want to show it to the world or you want to show it to yourself and raise the bar for yourself?

Wake up Sid!!!