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Friday, 12 April 2019
Friday, 13 April 2018
SUPREME COURT PANEL WANTS 3-YEAR INSURANCE POLICY FOR CARS, 5-YEAR POLICY FOR MOTORBIKES AT TIME OF SALE
Dipak K Dash,
Concerned over poor compliance of third party insurance of vehicles, which puts all road users at risk, the Supreme Court Committee on Road Safety has asked the insurance regulator to offer mandatory three-year insurance policy for cars and five-year policy for motorbikes at the time of sale and registration.
Sources in the Insurance Information Bureau (IIB) said only 6.5-7 crore vehicles had insurance cover against approximately 18 crore registered vehicles. Government officials said almost 50% of vehicles plying on roads had no valid insurance and a large share of them were two-wheelers.
Driving any vehicle without third-party (TP) insurance is an offence and attracts a fine of up to Rs 1,000 with a possible jail term of three months. These vehicles pose a serious risk as accident victims have little chance of getting inadequate compensation.
Self-damage and other insurance covers except TP are optional.
TOI has learnt that representatives of Insurance Regulatory and Development Authority (IRDA) told the SC panel at a recent meeting that it had allowed three-year insurance plans for two-wheelers and insurance companies could offer them. “But the road safety committee said this must be made mandatory to increase compliance. Giving any option does not work,” said a source who attended the meeting.
Data shows that five-year TP insurance upfront for two-wheelers will be almost similar to what companies charge for comprehensive insurance. For example, the annual TP insurance premium is only Rs 720 for majority of two-wheelers and so five-year insurance will be Rs 3,600, which is slightly higher than one year’s comprehensive insurance policy.
But insurance companies have their reasons. “The problem of uninsured vehicles can be fixed mainly by enforcement. Why can’t government devise a norm that every vehicle owner has to renew the registration annually in place of the present 15 years. No registration can happen without insurance and so there will be 100% compliance. Now, with all these processes going online, this proposition won’t be difficult to implement,” said an industry representative.
He added that though a few companies have been offering three-year insurance for two-wheelers, there were few takers.
Source: Economic Times
Friday, 6 April 2018
Aadhaar To Be Submitted Within 6 Months For New Insurance Policies
Correction: A previous version of this story erroneously stated that Aadhaar will not be mandatory for new insurance policies. The correct position is that customers buying new policies have 6 months to submit their Aadhaar.
Even after the Supreme Court extended the deadline to link Aadhaar with various services, including existing bank accounts, mutual funds and insurance policies, Aadhaar or Aadhaar enrolment number remains mandatory for opening a new bank account. At the same time, there are consumer complaints citing the demand for Aadhaar at points of sale of other financial products such as insurance policies and mutual funds.
The Insurance Regulatory and Development Authority of India (Irdai) has clarified that though Aadhaar is not compulsorily required at the time of buying a new insurance policy, the consumer will have to submit it within 6 months. An Irdai circular stated that for new insurance policies, the consumer is allowed 6 months from the date of commencement of account-based relationship to submit her Aadhaar number and permanent account number (PAN) or Form 60 to the insurer. “In absence of Aadhaar, (a) client shall submit any of the “Officially Valid Documents” as mentioned in the Prevention of Money-Laundering (Maintenance of Records) Rules, 2005 (as amended from time to time),” the regulator stated.
These rules state that officially valid documents include passport, driving licence, PAN card, voter identity card issued by the Election Commission of India, job card issued by Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) and Aadhaar card. All of these except PAN serve the purpose of identity as well as address proof, while PAN can only be a proof of identity.
For existing insurance policies, the date of linking Aadhaar is extended till the matter is finally heard and the judgement is pronounced by the Supreme Court of India, the insurance regulator said.
Aadhaar E-KYC for insurance
You should also take note that the Aadhaar-based electronic-know your customer (e-KYC) process is sufficient for the purpose of customer verification for insurance companies.
For life insurance products, regulatory guidelines mandate that insurers conduct a KYC check before selling the policy in case of direct sales. If the sale is through other channels, such as online, KYC is to be completed within 15 days of the sale.
These practices put the onus on insurers to ensure that these products are not used for money laundering.
For non-life insurance products like motor and health covers, the anti-money laundering guidelines of the insurance regulator mandate that the KYC process be done at the time of claim. Moreover, KYC will apply only when the claim settlement is over Rs1 lakh.
If you use Aadhaar for insurance KYC, you do not need additional documents as proof for details such as identity, date of birth or address. However, if the photograph in your Aadhaar is not clear, or there is a mismatch (for example, in photo, or name), the insurer can ask for additional documents. So, if you plan to use the Aadhaar e-KYC method, ensure that the details in your Aadhaar database are correct and updated, and that the photograph is clear.
You can verify your own Aadhaar authentication history through an option available on the Unique Identification Authority of India (UIDAI) website—www.uidai.gov.in. If you find any unauthorised authentication, you should register a complaint with UIDAI.
Source : LiveMint - 06-Apr-2018
Thursday, 5 April 2018
Saturday, 27 January 2018
Life Insurance Claims Are To Be Paid in 30 days
25-Jan-2018
It’s important to understand the process of making a claim in a life insurance policy, especially for the nominee of a life insurance policy. Knowing the process and the documents to be submitted can save you a lot of trouble. But did you know that to make insurance claims more efficient, the insurance regulator has spelt out strict turnaround timelines on claims and penalty on violation, under the Protection of Policyholders’ Interests Regulations of 2017. Read for more details.
How to file a claim
Start with filling the claim form, which can be downloaded from the insurer’s website or collected from the agent or the insurer’s office. The form asks for details such as policy number, date, time and cause of death of the policyholder, name of the nominee and bank account details. Other than the claim form, the nominee will also have to submit supporting documents such as the original policy papers, death certificate and medical records in case of natural death. In case of un-natural death that includes accidental death, murder and suicide, additional documents such as the first information report (FIR) and a postmortem report also need to be attached.
Start with filling the claim form, which can be downloaded from the insurer’s website or collected from the agent or the insurer’s office. The form asks for details such as policy number, date, time and cause of death of the policyholder, name of the nominee and bank account details. Other than the claim form, the nominee will also have to submit supporting documents such as the original policy papers, death certificate and medical records in case of natural death. In case of un-natural death that includes accidental death, murder and suicide, additional documents such as the first information report (FIR) and a postmortem report also need to be attached.
Also, the nominee needs to submit her Know Your Customers (KYC) details to the insurer. Do keep in mind that during calamities, insurers tend to waive the need for some of these documents.
Duty of the insurer
As per rules, a life insurer needs to process the claim without delay and if there are enquiries, they need to be raised together and not in a piece-meal manner. In fact, this needs to be done within a period of 15 days of the receipt of claim. The insurer has a window of 30 days from the date of receiving all the relevant papers and the required clarifications to pay the claim or reject it. But if the insurer sees merit in further investigation, it can take up to 90 days, which start from the date of receiving the claim and the claim needs to be settled within 30 days thereafter.
As per rules, a life insurer needs to process the claim without delay and if there are enquiries, they need to be raised together and not in a piece-meal manner. In fact, this needs to be done within a period of 15 days of the receipt of claim. The insurer has a window of 30 days from the date of receiving all the relevant papers and the required clarifications to pay the claim or reject it. But if the insurer sees merit in further investigation, it can take up to 90 days, which start from the date of receiving the claim and the claim needs to be settled within 30 days thereafter.
The penalty on violating these timelines are also specified. If there is a delay, the insurer shall pay interest at the rate of 2% above bank rate on the claim money from the date of receipt of the last necessary document. So, if you have done your bit by submitting all the documents, but the insurer settles the claim after 35 days, the insurer will not pay a penalty for 5 days, but 35 days.
Source : LiveMint
Saturday, 6 January 2018
The success story of LIC: From 1957 to 2017
Big players
Some of the top stocks in LIC's portfolio, which delivered handsome returns during the year include ITCBSE, ONGCBSE, NHPCBSE, NTPCBSE, SBI, ICICI, Coal IndiaBSE, SAILBSE and NMDCBSE.
Good news for the customers
Thanks to higher profit from it's huge portfolio, LIC has decided to pay 40 per cent higher bonus and dividents to the government and its customers for 2016-17.
Starting of journey
The Parliament of India passed the Life Insurance Corporation Act on the 19th of June 1956, and the Life Insurance Corporation of India was created on 1st September, 1956, with the objective of spreading life insurance more widely and to reach all insurable persons in the country, providing them adequate financial cover at a reasonable cost.
Branch offices
LIC had 5 zonal offices, 33 divisional offices and 212 branch offices, apart from its corporate office in the year 1956.
Market expansion
LIC took place within a few years and many new branch offices were opened. From about 200 crores of New Business in 1957 the corporation crossed 1000 crores only in the year 1969-70, and it took another 10 years for LIC to cross 2000 crore benchmark of new business.
Market expansion
LIC took place within a few years and many new branch offices were opened. From about 200 crores of New Business in 1957 the corporation crossed 1000 crores only in the year 1969-70, and it took another 10 years for LIC to cross 2000 crore benchmark of new business.
Stable growth rate
LIC continues to be the dominant life insurer even in the liberalized scenario of Indian insurance and is moving fast on a healthy growth rate of 16.67 per cent trajectory. LIC has issued over one crore policies during the current year.
Journey continues
From then to now, LIC has crossed several milestones; set remarkable performance records in the Indian life insurance business and continues to dominate the market till date.
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