Insurance Newsletter: 11-15 November 2013

Indian Overseas Bank is planning to raise around Rs. 16.26 billion from the government and the Life Insurance Corporation of India

November 14, 2013 4:30 IST | India Infoline News Service
News this week

IRDA proposes to set up Insurance Clearing House

The Insurance Regulatory and Development Authority on Friday has proposed to set up an Insurance Clearing House.

According to IRDA, the inter-company balances in reinsurance and coinsurance business are at a very high level and have been on a constant rise.

In order to ensure timely and effective reconciliation of these balances and also to achieve transparency and for timely and efficient accounting and settlement of these balances, the Authority intends to establish, “Insurance Clearing House” to act as a clearing house for these transactions, IRDA said in a notification...
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Indian public banks struggle to raise Basel III capital: Fitch

India's public sector banks (PSBs) continue to face several challenges in raising capital and meeting the higher Basel III requirements, says Fitch Ratings. This includes insufficient market appetite to fill the regulatory requirement, which has raised the dependence on the state-owned Life Insurance Corporation (LIC) for private placement of PSBs' Basel III-compliant capital instruments.

Indian banks have until March 2018 to be fully compliant. But the weakening profitability of the PSBs, in particular, is constraining their retained earnings and raising their overall capital requirement. This need will increase even further if loan growth in the system were to resume close to 20% year-on-year from the current 14%-15% rate... Read more

Major task is to implement PFRDA Act 2013: FM

Union Finance Minister P Chidambaram on Tuesday said that with the Pension Fund Regulatory and Development Authority (PFRDA) Bill having been passed by Parliament, the major task before us was to implement it in letter and spirit.

FM mentioned that most countries are moving from a ‘defined benefit’ pension system to a ‘defined contribution’ system to enable pension related commitments to be sustainably discharged. The National Pension System (NPS) was a step in this direction.

He mentioned that the PFRDA Act would give statutory status to the PFRDA, the pensions sector regulator, and in addition to other objectives, aims to address apprehensions regarding safety and yield under the NPS... Read more

IOB plans to raise Rs. 16.26 billion from govt, LIC

Indian Overseas Bank (IOB) said that it is planning to raise around Rs. 16.26 billion from the government and the Life Insurance Corporation of India.

The Chennai-based public sector bank has received the approval from its Board for the preferential allotment of equity shares.

IOB said that the Government has conveyed its decision to infuse capital funds to the Bank to the extent of Rs. 12 billion and advised the Bank to take all preparatory steps in this regard...
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Aviva Life unveils 13 products under new IRDA norms

Aviva Life Insurance on Monday said that it has launched 13 products in compliance with new Insurance Regulatory and Development Authority (IRDA) guidelines.

The plans are — Aviva Health Secure (online health insurance plan), Jana Suraksha (rural term plan), Life Shield Plus (term plan), Life Shield Platinum, Dhan Samruddhi, Wealth Builder, Life Shield Advantage (traditional life insurance plans), I Life (online term plan), i—Shield (online term plan with return of premium) and Next Innings Pension Plan...
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Deutsche Bank, Max Bupa sign bancassurance tie up

Deutsche Bank and Max Bupa Health Insurance announced their bancassurance agency partnership to provide Max Bupa’s comprehensive health insurance offerings to Deutsche Bank customers across the country.

The cooperation comes on the back of IRDA’s guidelines which permits the banks to act as corporate agents of one stand alone health insurance company in addition to their existing one life and one non-life insurance companies. The agency partnership combines Max Bupa’s experience and leadership in introducing innovative health insurance products with Deutsche Bank’s affluent clientele in the country.

DPLI unveils two child protection cum savings plans

DLF Pramerica Life Insurance Co Ltd (DPLI) has launched two new Child Protection-cum-Savings Plans - ‘DLF Pramerica Future Idols Gold+’, a participating child protection cum savings plan and ‘DLF Pramerica Rakshak+’, a non-participating child benefit protection sum savings plan - to help parents safeguard their child’s financial future in case of any eventuality.

Both the plans provide a comprehensive cover to address a child’s immediate, recurring and future long term financial needs. They also allow for wealth creation through accrual of Bonuses and Guaranteed Additions respectively... Read more

Leader Speak

India is among five largest economies on basis of purchasing power parity

Despite the volatility in the markets, developing economies show signs of strong domestic demand, which has allowed them to recover from market turmoil more quickly than developed markets and grow at a much faster rate, Prashant Sharma, Chief Investment Officer, Max Life Insurance, says...
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