Tuesday, April 29, 2014

IRDA: New business premium in life insurance up 12% in 2013-14

New business premium in the life insurance segment increased by 12 per cent in the year ended March 31, 2014, compared to the previous year, according to T S Vijayan, Chairman, Insurance Regulatory and Development Authority (IRDA).

“We have got only provisional, unaudited figures so far. The growth in the non-life sector was around 13 per cent,’’ Vijayan told Business Line on the sidelines of the first Insurance Awareness Day celebrations organised by IRDA here on Saturday.

During the year 2012-13, total premium in life and non-life insurance stood at Rs 2.87 lakh crore and Rs 63,000 crore respectively.

On the growth potential in the current year, the regulator said health insurance was poised for “significant” growth, while group insurance would drive growth in the life insurance segment. “In the non-life sector, things will depend on how the industry performs,” he added.

The market for traditional policies vis-à-vis unit-linked insurance products was gaining traction, the Chairman said.


When asked about the delay in making banks insurance brokers, he said: “There are some concerns expressed by banks in becoming brokers.” On whether banks can be permitted to tie up with more than one insurer as a corporate agent, Vijayan said: “All this is only nomenclature but the point is better distribution.”

Earlier, while speaking after the formal launch of the regulator’s official page on YouTube and 12 animation films and brochures to promote insurance awareness, he said the foundation day of IRDA would from now on be celebrated as Insurance Awareness Day.

Since its establishment on April 19, 2000, IRDA had taken measures to promote the industry and welfare of consumers, he said, adding: “Life insurance penetration had gone up from 2.15 per cent of gross domestic product in 2001 to 3.17 per cent in 2012.”

IRDA imposes fine on Reliance Life Insurance for violating underwriting regulations

The Insurance Regulatory and Development Authority (Irda) has imposed a monetary penalty of INR17.7m ($294,166) against Reliance Life Insurance for violating various insurance regulations in the country.

During the course of investigation, the Indian insurance watchdog scutinized 47 charges leveled against the life insurance company, which includes violation of advertisement and product distribution norms, as reported by PTI.

The market regulator slammed the insurance for indulge in the business sourced from unlicensed entities through multi level marketing for which the company will have to reimburse a fine of INR6.5m ($108,027).

Additionally, the insurer was fined INR2.5m ($41,549) for service agreements with various entities, which IRDA claimed were also engaged for providing services of lead generation and dissemination of information.

The market regulator said that such agreements with various third parties have violated the Insurance Advertisement Regulations, 2000.

Apart from this, IRDA fined INR2.5m ($41,549) on the insurer for the procedure adopted in issuing cheques favoring the Master Policy Holder which breached its group insurance guidelines.

"Further, payment of significant monies for an unskilled job of distribution of publicity material under the guise of 'Dissemination of Information' is questionable," said Irda in the order. Reliance Life has been directed to immediately discontinue the payments.

"...the penalty of Rs1.77 crore shall be remitted by the Life insurer by debiting shareholders' account within a period of 15 days from the date of issuance of this order...," Irda said in its order.

Source: http://lifeinsuranceandpensions.insurance-business-review.com

Life Insurance : Investment options

Here is a good article on what type of Life insurance you should choose in case you want to use it as an investment option..

When the stock market does well, it becomes easier for life insurance companies to sell "permanent life" products that grow in value in step with general increases in the stock market. Unlike term life policies, which only pay when the insured person dies within a specified period, permanent life policies are not restricted to a specific period and accrue cash value.

Read on: Is life insurance a good way to invest?
Source: http://www.chicagotribune.com