Insurance Newsletter – September 23 to 27, 2013

India Infoline News Service | Mumbai |

Insurance repositories have been launched to hold policies in digital or electronic form.

Top Stories
 
Life Insurance industry to grow 12%-15% in 5 years
Life Insurance Council, the industry body of life insurers in India, has estimated life insurance industry to record a CAGR of 12-15% over the next 5 years. This growth expectation is based on multiple regulatory and industry changes brought over in the past few years as well as the favourable demographics of the country.

Favourable Indian demography – insurable population, expected to grow to 75 crore and life expectancy to 74 years by FY 2020, would help achieve spurt in the preference for Life Insurance. Thus, Life Insurance, which is the second most preferred financial instrument, would drive the growth in Net Household Financial Savings to an estimated 35% of Total Savings in the next seven years, as compared to meager 26% in FY10, Life Insurance Council said in a press release on Thursday... Read more

Single KYC required for e-insurance account holders
The Insurance Regulatory and Development Authority (IRDA) on Friday said an e-insurance accountholder under the insurance repository system need not submit additional know your customer (KYC) documents each time a policy is bought.

At present, for every new insurance cover, a customer has to submit new KYC documents since there is no sharing of this information among insurers.

Insurance repositories have been launched to hold policies in digital or electronic form.

The five licensed insurance repositories will sign an agreement with the insurers who share the electronic data pertaining to the insurance policies with the repositories.

The IRDA said within seven days of submitting an application, a customer would get an e-insurance account... Read more

Domestic News

Reliance Life launches electronic insurance policies
Reliance Life Insurance Company (RLIC), part of Reliance Capital Ltd, announced the launch of life insurance policies in electronic demat form across all its products. The announcement was made by Anup Rau, Chief Executive Officer, RLIC, in Mumbai. This initiative follows the recent inauguration of Insurance Regulatory and Development Authority's Insurance Repository System (IRS) by Finance Minister P Chidambaram in Hyderabad last week to enable and encourage policy holders to hold their insurance policies in demat form... Read more

LIC's Sri Lanka unit to strengthen base

Life Insurance Corporation (LIC) of India's subsidiary LIC (Lanka) Ltd said that it will aggressively scale up operations to become the market leader in the life insurance business in Sri Lanka, according to a media report.

LIC India Chairman SK Roy said that the insurer was prepared to infuse capital to support its subsidiary for expansion of its operation, the report added.

As part of LIC Lanka’s strategy, the insurance company will expand the distribution network, geographical reach in terms of branches and will also introduce new products fine-tuned to the local market, the report further said.

At present, LIC Lanka has 28 branches and closer to 1,000 employees including the commission-based agents scattered across the island. LIC India has been in business since 1956.

IRDA invites applications for on-line, off-line ATIs

The Insurance Regulatory and Development Authority (IRDA) on Friday invited applications from organisations and institutions to establish on-line and off-line ATIs (agents training institutes) for conducting insurance agents training as mandated for the renewal of agent’s license.

Different application forms are prescribed for establishing on-line and off-line training institutes. Hence applicants are advised to apply in relevant format only, IRDA said in a notification... Read more

IICA, BSE sign MoU to develop India’s first CSR Index
BSE Ltd and Indian Institution of Corporate Affairs (IICA) on Monday have signed an MoU to work collaboratively to develop a Corporate Social Responsibility (CSR) Index, take up capacity building on CSR, conduct education and awareness programmes and other activities to facilitate a more effective corporate participation in CSR areas. “Transparency is very important and so the companies must disclose their spending and areas of spend on their own websites and the MCA website as well,” Sachin Pilot said... Read more

Learning

Basic things to know about insurance repositories

Till now insurance policies were in paper form, whether we submit our proposal application in physical form or through online mode. The Insurance Regulatory and Development Authority (IRDA) launched the insurance repository system on 16 September 2013 to provide better services to policyholders and enhance insurance penetration.

Now, our insurance policies including the existing ones can be converted in an electronic form and held with an ‘insurance repository’. E-policies will eliminate paper and associated risks of storage and loss and provide convenience and safety to the customer... Read more

International News

Barclays plans to shut wealth management services: reports
Barclays Plc is planning to shut wealth management services in about 130 countries by 2016, a media report said.

The company will cut jobs as part of its effort to restructure its costs, the report further said.

"This is part of our new strategy, focusing on reducing complexity," a Barclays spokesman reported. In April, Barclays announced its plans to restructure its wealth business.

60% of defined contribution assets are intermediated: Cerulli

New research from Cerulli Associates, a Boston-based global analytics firm, finds two-thirds of private defined contribution (DC) assets are invested in plans that have an ongoing advisor/consultant relationship, and that dedicated defined contribution investment-only (DCIO) wholesalers are a key to success.

"The stickiness of DC assets is often cited as the primary reason why asset managers find the DC market attractive," Kevin Chisholm, associate director at Cerulli reveals. "Plan participants very rarely change their asset allocation, and asset managers are likely able to retain DC assets and benefit from ongoing contributions."... Read more

German storm claims to cost $240mn: Swiss Re

Swiss Re estimates industry-wide insured losses between $2 billion and 2.7 billion. Hail storms in northern and southern Germany in July will generate a claims burden of approximately $240 million for Swiss Re.

Unusually strong hail storms throughout Germany in July of this year caused significant hail losses in the country. A first hail storm affected the areas around Hannover and Wolfsburg on 27 July.

One day later, another hail storm hit southern Germany, causing major damage around the cities of Rottenburg, Tuebingen und Reutlingen. It is expected that these hail storms will generate approximately $240 million in claims for Swiss Re, net of retrocession and before tax. The total losses for the insurance industry are estimated between $2 billion and $2.7 billion.

 

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