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The <keyword id="6391022" type="ORGANIZATION" weightage="100" keywordseo="Insurance-Regulatory-and-Development-Authority">Insurance Regulatory and Development Authority</keyword> (<keyword id="6361421" type="ORGANIZATION" weightage="100" keywordseo="IRDA">IRDA</keyword>) has issued new norms for pricing of group products and immediate annuity products. 
	“It is observed in group products that the premiums approved under file and use procedure and the actual premium quoted to various groups appear different...Hence, the Authority withdraws the cited circulars with immediate effect,” TS Vijayan, chairman, IRDA said.<o:p></o:p>

	According to the new norms for annuity products, life insurance companies will have the freedom to vary annuity rates in the range of -10% to +10% of the approved annuity rates without taking prior permission from IRDA, provided the change is due to changing interest rates scenarios.<o:p></o:p>

	These guidelines will come into effect from October 1. The IRDA also took back two existing circulars issued in July 2006 and March 2008 with immediate effect.<o:p></o:p>

IRDA Issues Fresh Guidelines For Group Products Pricing

Buying insurance is a tricky process. So when you have to buy <keyword id="6362363" type="ORGANIZATION" weightage="20" keywordseo="health-insurance">health insurance</keyword> for yourself and your family, how do you ensure you are getting the best deal? BI India shares a few tips to remember before you sign the papers and buy the health insurance product for your loved ones. 
	 
	Check the coverage 
	 
	Before buying a health insurance plan, check who all can you cover under the plan. Every insurance plan has an age limit. It doesn’t make sense to buy a plan that doesn’t cover your entire family if the premiums are too high. Prefer buying a plan that covers your immediate family at least. 
	 
	Plan for the future 
	 One buys an insurance coverage for future contingencies. Hence, factor in the <keyword id="22195" type="COMPANY" weightage="20" keywordseo="Inflation">inflation</keyword> and the estimated costs at the hospitals in the future. Don’t go by the current costs and buy a plan. 
	 
	Understand the terms and conditions 
	 Read the document carefully in order to understand the deal. At times, you end up buying an insurance plan in which the company will not bear the entire costs. As per Insurance Regulatory and Development Authority of India (<keyword id="6361421" type="ORGANIZATION" weightage="20" keywordseo="IRDA">IRDA</keyword>) there are many plans in which the consumer ends up becoming the co-bearer. Ensure, you know these things before signing the documents.

These three tips will help you buy the best health insurance plan

The <keyword id="35450" type="COMPANY" weightage="40" keywordseo="insurance">insurance</keyword> regulator, <keyword id="6361421" type="ORGANIZATION" weightage="40" keywordseo="IRDA">Irda</keyword>, have given a more customer-friendly avatar to the unit-linked insurance plans, or, <keyword id="6362086" type="CITY" weightage="40" keywordseo="Ulips">ULIPs</keyword>. One of the major reforms in the guidelines was the introduction of cap on charges and commissions that could not be front-loaded and had to be evenly distributed throughout the policy term. Also, the regulator mandated a higher death benefit and a longer lock-in period. 
 
As a result, compared to the old Ulips, the new ones provide better avenues for wealth creation along with adequate cover. With reduced cost structure, there is more that gets invested and therefore makes a significant difference to the returns earned in the long term. 
 
The upfront charges are now uniformly distributed over the five year lock-in period. So, a good portion of the first year premium will be invested and your money starts to grow from day one. 
 
Also, the maximum reduction in yield at maturity, that is, the difference between the gross yield and the net yield has been capped at 3% for policies whose tenure is less than or equal to 10 years, whereas, for plans whose tenure exceed 10 years, the total charges can't exceed 2.25%. This means, the IRR, or, internal rate of return cannot be less than 7.75% in any case. 
 
The lock-in period has increased from 3 years to 5 years which ensures that these policies have long-term orientations and enjoy greater compounding benefits—higher the returns the more your earnings get re-invested. 
 
Insurers have launched plans with lower charges than the cap. In fact, there are online ULIPs in the market where you do not have to pay any commission. So the whole money gets invested and you are able to get higher compounding benefits. 
 They have also become more flexible offering different cover sizes and premium paying terms. Also, there are more fund options to cater to different risk appetites along with top-up options to <keyword id="47916" type="UNKNOWN" weightage="40" keywordseo="invest">invest</keyword> additional premiums. A few insurers are also offering unlimited number of partial withdrawals and higher death benefit as much as up to 40 times the yearly premium. 
 
Being essentially an insurance product, they haven’t lost their core component either. A requirement of minimum sum assured should now be at least ten-times the yearly premium paid ensures they are provide adequate protection as well.

Better returns from new ULIPs

Following the successful acquisition of ING Vyasa, <keyword id="6376194" type="CITY" weightage="20" keywordseo="Kotak-Mahindra">Kotak Mahindra</keyword> Bank plans to enter the general insurance market. The bank will soon launch a subsidiary insurance company as it has received the requisite approval from the Reserve Bank of India (<keyword id="30067" type="ORGANIZATION" weightage="20" keywordseo="RBI">RBI</keyword>). 
	 
	“The General Insurance business in India is currently a Rs 77,000 crore premium per annum industry and is growing at a healthy rate of 17%. It provides a cover of close to Rs 1,000 lakh crore,” said Gaurang Shah, president of Asset Management, Insurance and International Bank division of Kotak Mahindra. 
	 
	“With the addition of General Insurance business, Kotak Mahindra group with existing presence across banking, wealth management, life insurance, broking, mutual funds and private equity will be able to offer the complete range of financial products and services to our retail and wholesale customers. Our knowledge and experience across the BFSI spectrum generates excellent cross synergies that we hope to leverage in our General Insurance business to the benefit of our customers and stakeholders alike,” added Shah. 
	 The company has also received in-principle approval from insurance regulatory body Insurance Regulatory and Development Authority (<keyword id="6361421" type="ORGANIZATION" weightage="20" keywordseo="IRDA">IRDA</keyword>) for commencing the new subsidiary. 
	 
	The bank has appointed Mahesh Balasubramanian, the current executive vice-president and co-head of Branch Banking vertical of the bank, as the CEO of the new general insurance company. 
	 
	“With Kotak Mahindra group’s increasing distribution network, growing brand equity and consumer franchise, we believe we will be able to leverage synergies and add significant value to the general insurance business. Being a new entrant, we will have opportunities to embrace new technologies and developments in the digital world to provide innovative products and solutions which will deliver superior customer experience,” said Balasubramanian. 
	 
	Image: Indiatimes.com

Kotak Mahindra Bank
To Enter General Insurance Market, Will Soon Set Up Insurance Subsidiary

<keyword id="443223" type="UNKNOWN" weightage="100" keywordseo="misselling">Misselling</keyword> is defined as deliberate, reckless, or negligent sale of products or services in circumstances where the contract is either misrepresented, or the product or service is unsuitable for the customer's needs. 
 
In simple terms Misselling means that you were given unsuitable advice, the risks were not explained to you or you were not given the information you needed, and ended up with a product that isn’t right for you. 
 
Examples of Misselling in Finance 
· Selling life insurance to someone who has no dependents. 
· Selling retired or elderly person a long-term or child plan. 
· Selling the policy promising a single premium mode or a limited term policy but it actually turns out to be a regular premium mode. 
· Selling endowment plans without disclosing the expenses and commissions earned, 
· Selling ULIPs by promising huge returns, 
· Asking investors to surrender the existing policy (giving false reasons of non performance) and to buy a new high commission-yielding policy. Churning the policy every five or six years while the policyholder pays the price 
· Selling investor five funds with SIPs of Rs 1,000 each instead of one fund with SIP of Rs 5,000. 
· A bank relationship manager suggesting his client to exit from the existing funds as their NAV is at Rs 140, Rs 80 each, and instead start fresh SIP investments in two cheap NFOs with their NAV of Rs 10 each, recommended by the bank’s research team. Relationship manager used the ignorance of his client that low NAV doesn’t mean the fund is cheap and it has nothing to do with the future performance of the fund. · Recently it’s also observed that some unscrupulous elements call randomly(send emails) and introduce themselves as belonging from <keyword id="6361421" type="ORGANIZATION" weightage="60" keywordseo="IRDA">IRDA</keyword> or Ministry of Finance or <keyword id="30067" type="ORGANIZATION" weightage="60" keywordseo="RBI">RBI</keyword> and lure customers with fake offers like bonus or incentives. But they are pushing high commission-yielding products. 
 
Misselling for financial products is not unique to insurance and happens in various lines of businesses such as loans, credit cards, investment products, pharmacy, hospitality etc. The customers mostly buy financial products either in obligation or because of ignorance. Lot of mis-selling of insurance policy happens during last month of a financial year as people are in a hurry to save taxes. 
 
But Misselling is quite rampant in our daily life also in products other than the financial products. Example of a misselling of non financial products: 
 
● Say you were looking to use 4G on a mobile phone. You told the shop assistant that you planned use 4G and they recommended a model. Then you took it home, and found that it doesn’t work. There’s nothing wrong with the phone itself – it’s not faulty – but it’s not what you needed. The mobile phone was mis-sold to you. 
● Fairness creams are a multi-billion rupee industry in India as in India a large population equates fairness with beauty and superiority. Now they have for men too! 
● A superior course, global exposure, international faculty, good placement. Many universities claim. 
● Speak Asia, duped around 23 lakh investors to the tune of Rs 2,000 crore. It promised a weekly income, merely on filling online survey forms. Members paid money to join the firm’s network and earn reward points for referring its offerings to friends and peers. 
● Diet soda With no calories or sugar, comes with its own set of side effects that may harm your health-from kick starting kidney problems to adding inches to your waistline. 
● Brown bread much of the ‘brown’ bread you’ll find in the supermarket is simply the same white bread with brown coloring added. Hardly the healthier choice it’s made out to be! 
● As Indians are becoming more health conscious market is full of high nutritional products heart-healthy cooking oil, crunchy granola bars, fruit-flavoured yoghurt, to dry fruit-sprinkled muesli, we are taking everything that screams low calorie. 
 
If something looks too good to be true, it probably is. And this applies in case of buying anything, any product financial products as well. Don’t get tricked into the trap of marketing, intermediaries and buy the product just because the advertisement or agent is eulogizing it. 
 
Ignorance is no bliss. If you have limited wisdom about a product, an insurance plan or a mutual fund scheme, it becomes easy for commission-seeking agents to trick you into the wrong insurance or mutual fund scheme. Understand that a salesperson or an agent’s job is not to advice on the product's suitability for the specific needs of customers. He/she is just an intermediary between the company he is representing and you, as a customer and so his strategy revolves around just three words: sell, sell, sell. It is unrewarding for him to think about the investor’s financial goals when he has his own to fulfill. 
 
Stop the blame game. Do your own homework before buying any product, including financial product. Playing victim is no use and then till how long can you hide behind it. Misselling happens because mis-buying happens. There is no easy way out, no short cuts. As they say “It is easier to protect your feet with slippers than to cover the earth with carpet.” 
This article is written by Kritika. 
Image: Thinkstock

Misselling: Why You Need To Beware Of It

With less than a month to go, there is a sense of anticipation from the <keyword id="6358021" type="PERSON" weightage="20" keywordseo="budget">Budget</keyword> 2015-16. Our Finance Minister, Mr Arun Jaitley faces a unique challenge of presenting an economy, industry and people-friendly budget. With the emerging markets struggling and the global economy still in the recovery phase, the government will have to ensure that India is on track for high growth and reduced fiscal deficit. Which is why, it has to be a foresighted, power-packed Budget. 
 From now till the budget, there will be lot of commentary and discussions about what the budget should do across economic, industry, and fiscal front. I’d like to focus on the <keyword id="65469" type="UNKNOWN" weightage="20" keywordseo="Financial-independence">financial independence</keyword> measures that should be included in the upcoming Budget through this post. 
 
1. Rethink/redesign pension schemes According to a recent report by <keyword id="6359483" type="CITY" weightage="20" keywordseo="Crisil">CRISIL</keyword>, pension schemes cover only 8% of employees retiring from the private sector. The remaining 92% have neither income security nor health insurance. This alarming statistic has put the focus on pension, yet again. Theoretically, there is National Pension Scheme and a host of insurance plans focused on pension protection for the masses. However, in reality, despite the National Pension Scheme being one of the cheapest pension products in the world, it has limited reach and awareness. Insurance pension plans are limited by regulation in terms of their attractiveness to the consumer as well as the distributor, and hence, continues to remain a well-kept secret from the people who need these products. The government needs to review the overall coverage, take bold steps in strengthening the distribution and awareness, and make these products at par with PFs and other saving products to boost their adoption. Further, the government needs to encourage retirement planning by enhancing tax exemption limits (or create a dedicated exempt category for retirement planning for approved products) and ensure no tax on the withdrawal amount or annuity income along with flexibility to buy any annuity plan in the golden years. These steps will not only ensure citizens’ welfare in their later years, but also help Central and State governments cut down their future liabilities. 
 
2. Focus on healthcare and health insurance India’s public spending on healthcare is just 1.3% of the <keyword id="35050" type="CITY" weightage="20" keywordseo="gdp">GDP</keyword>. With 75% of the population outside the health insurance ambit, the government needs to put the spotlight on health insurance. As per the latest records of the World Health Organization, patients in India pay for 58% of the total healthcare expenditure from their own pockets compared to 11% in the US. The ever rising cost of medical expenses further necessitates the key role a good health insurance scheme can play in providing adequate protection to people in the time of need. According to the Insurance Regulatory and Development Authority of India (<keyword id="6361421" type="ORGANIZATION" weightage="20" keywordseo="IRDA">Irda</keyword>), insurance penetration stands close to 4%. Under the Health Insurance Vision 2020, the Indian government plans to cover 80% of the population, but it is easier said than done. Government would do well by showing some intent towards expanding healthcare access and clearing the insurance bill in the budget session; thereby, paving the way for additional FDI capital and multi-national interest in health insurance. 
 
3. Encourage home ownership 
According to a National Housing Bank report, more than 80% of the low-income groups and economically weaker sections in urban areas do not have access to institutional finance. These people depend on informal sources for their credit needs and, therefore, are not integrated in the formal financial market. The government should continue the additional exemption of Rs 1 lakh for the first time home buyers for 2015-16 also, and should remove the cap of Rs 25 lakh on the value of home as property prices in metro cities cross that limit easily. 
 
4. Increase investment limits 
The last suggestion is to again increase the investment limit under Section 80C of the income tax law. The reason this would help is because the household savings rate has been dipping and currently stands at ~30% of GDP. For salaried class, this move would encourage higher savings in to long-term instruments, most of which in turn, directly or indirectly, help long-term capital needs of the country. 
About the author: This article has been written by Naveen Kukreja, Director, PaisaBazaar.com

Budget 2015-16:
Time for financial independence

Kolkata, Feb 27 () State-owned AgricultureInsurance Company of India Ltd currently licensed for cropinsurance in the country, sought the regulator's approval todiversify into more agricultural and rural insurance products,a top company official said on Thursday.The single product insurance company said it aims atoffering "comprehensive" insurance solution for the ruralpopulation rather than restricting itself to crop insurance."We want to launch a comprehensive insurance policyand already applied with the Insurance Regulatory andDevelopment Authority for their permission," AICIL chairmanand managing director Malay Kumar Poddar said.He was talking to reporters on the sidelines of TheBengal Chamber organised Rural Connect 2020.Poddar said he expects the IRDA approval in the nearfuture for rural comprehensive insurance product that willcover all areas related to agriculture, aquaculture, animalhusbandry and farm equipment.He also expects to bring down the cost of cropinsurance with the comprehensive policy by covering all risksof a farmer's livelihood.AICIL offers crop insurance to West Bengal's tailoredproduct after the state did not roll out the Pradhan MantriFasal Bima Yojana (PMBFY).West Bengal agriculture chief advisor to the chiefminister Pradip Kr Mazumdar said the state offers cropinsurance free of cost to all farmers.In PMFBY, a farmer has to bear the cost of 2 per centof the sum assured while the rest is borne by the Center andrespective state governments.AICIL said during last Kharif crop in Bengal it hadcovered 35 lakh farmers in 15 districts. BSMNN NN

Agri Insurance Co for comprehensive policy, seeks IRDA nod

<keyword id="22053621" type="General" weightage="20" keywordseo="Insurance-regulator-IRDA" source="keywords" meta.keywordsubtype="org" meta.entityname="Insurance regulator IRDA" meta.hostid="261" meta.entityid="Insurance regulator IRDA">Insurance regulator IRDA</keyword> has introduced sweeping reforms for various <keyword id="19936531" type="General" weightage="100" keywordseo="life-insurance" source="keywords">life insurance</keyword> products. In its master circular dated 12th June, 2024, the insurance watchdog laid out a slew of customer-friendly directives for life insurance companies to follow with immediate effect. Read on to know all about how these new rules will impact you : <cmsannotation type="cmsannotation" annotationid="Customer information sheet" comment="subhead" text="Customer information sheet"><keyword id="22033784" type="General" weightage="20" keywordseo="customer-information-sheet" source="keywords">Customer information sheet</keyword></cmsannotation> Going ahead, all life insurance companies will have to mandatorily provide their policyholders with a CIS, or Customer Information Sheet. This will serve to explain to them the basic features of the policy in very simple terms, and will include essential details like sum assured, benefits, policy loan options, free-look period and procedures for making claims and redressing grievances. In addition, benefits payable to the policyholder if they survive the policy tenure (maturity benefits), upon death and surrender of policy should also be clearly spelt out. Along with this, the policyholders are also entitled to a customised illustration of how the policy will benefit them while they are being sold the policy. CIS should also be made available to the policyholder in their local language on request. <cmsannotation type="cmsannotation" annotationid="Free-look and grace period" comment="subhead" text="Free-look and grace period"><keyword id="22053620" type="General" weightage="20" keywordseo="Free-look-and-Grace-Period" source="Orion">Free-look and grace period</keyword></cmsannotation> Policyholders will now have a 30-day window from the day they receive the policy document to review and cancel the policy if they want. If the policy is cancelled within this period, they will be entitled to a full premium refund. Earlier, this period only lasted for 15 days. For grace period, which basically refers to the additional, penalty-free window given to the policyholder to make premium payment post due date to avoid losing coverage, the windows will differ depending on premium payment frequency. If you pay the policy premiums on a monthly basis, you will get a 15-day grace period. For premium payments made on a quarterly/half-yearly or annual basis, the grace period will be of 30 days. <cmsannotation type="cmsannotation" annotationid="Penalty on violating Ombudsman’s word" comment="subhead" text="Penalty on violating Ombudsman’s word">Penalty on violating Ombudsman’s word</cmsannotation> The insurer is bound to comply with the <keyword id="960887" type="General" weightage="20" keywordseo="Insurance-Ombudsman" source="Orion">Insurance Ombudsman</keyword>’s award within 30 days of receiving the same. In case the same is violated, the insurer will have to pay a penalty of Rs 5,000 per day to the complainant. <cmsannotation type="cmsannotation" annotationid="Higher value on early policy surrender" comment="subhead" text="Higher value on early policy surrender">Higher value on early policy surrender</cmsannotation> Often, policyholders ended up with a low, negligible amount as refund upon surrendering their insurance policy. This is set to change with <keyword id="21879234" type="General" weightage="20" keywordseo="IRDA" source="keywords">IRDA</keyword>’s latest directives. Now, policyholders will be eligible for <keyword id="885219" type="General" weightage="20" keywordseo="surrender-value" source="Orion">surrender value</keyword> even if they decide to surrender their policy after just one year. Previously, only 50% of <keyword id="2939473" type="General" weightage="20" keywordseo="policy-premium" source="Orion">policy premium</keyword> would be refunded, provided the policyholders surrendered their policy between years 4-7 of the policy tenure. Moreover, they would lose the entire premium amount if they surrendered their policy within a year. Customers will also be entitled to higher special surrender value (SSV) from now on. This SSV should be at least equivalent to the expected present one of the these three: <ol><li>Paid up sum assured, or present value of your sum assured after you stop paying premiums</li><li>Paid up future benefits</li><li>Accrued benefits</li></ol>Also, it will be compulsory for life insurers to offer loans to policyholders as per the eligible surrender value of the policy. Says Vivek Jain, Head, Investments, Policybazaar.com, "The provision for higher Surrender Value (SV), calculated at a prevailing 10-year government securities rate with a limited spread, significantly increases the value returned to policyholders in the event of a policy surrender, after the completion of first year. The mandatory facility of policy loans across all life insurance savings products and the allowance of partial withdrawals under pension products will provide vital financial flexibility, which will enable policyholders to meet liquidity needs and specific financial goals. These measures will certainly enhance trust and transparency in the industry." <cmsannotation type="cmsannotation" annotationid="Partial withdrawal allowed from pension products" comment="subhead" text="Partial withdrawal allowed from pension products">Partial withdrawal allowed from pension products</cmsannotation> Policyholders will be allowed to make partial withdrawals, provided they have 3 years of continuous coverage under their insurance-cum-pension plan. Also, these withdrawals cannot be more than 25% of the total premiums paid till date. The insurer cannot use this withdrawal towards making any adjustments in the policy's sum assured. However, this withdrawal will only be allowed for specific situations, like funding children’s higher education/marriage, constructing a house, treating critical illnesses, starting a new venture or for skill development purposes.

Here’s how your life insurance plans are set to change

To ensure that you are not taken for a ride or lose out on benefits, go through these clauses in your life and health <keyword id="35450" type="COMPANY" weightage="40" keywordseo="insurance">insurance</keyword> policies. 
 
Health insurance 
 
Contribution clause 
 
The health insurance regulations have done away with the contribution clause. So, if you have multiple health covers, you can choose any policy to make a claim. 
 
“While the contribution clause was earlier an inconvenience for the customer, Irda has given the policyholder the right to select a plan of his choice while making a claim,” says Mukesh Kumar, member, executive management and head, HR, marketing and strategy planning, HDFC ERGO. 
 
Earlier, if you had more than one policy, your approved claim amount had to be split in the ratio of the sums insured. Now, you can decide which insurer to approach for the entire claim amount. 
 
Renewability clause 
 
Many senior citizens had complained about insurers refusing to renew policies on grounds of adverse claim experience at a stage when they needed the cover the most. Now, Irda has made it mandatory for insurers to renew a policy except on grounds of fraud, moral hazard or misrepresentation. 
 
“The insurer has to renew a policy on identical terms and conditions on which the first policy was issued. Any variation requires obtaining the specific written consent of the insured,” says consumer activist Jehangir Gai. Claim-based loading, where premiums were hiked because of a claim made in the previous year, too, stands obliterated. 
 
Insurers can load premium only on the basis of overall age-wise and ailment-wise claims experience, among other parameters. 
 
Reasonability clause 
 
According to insurers, this is one of the most common causes of disputes on claim settlement. The clause states that only ‘reasonably and necessarily’ incurred expenses will be eligible for a claim. Clearly, this is a grey area open to interpretation. 
 
“Reasonable charges are arrived at by insurers by comparing the standard billing by a hospital and comparing the same with the prevailing charges in the same geographical area for similar or identical services. Thus, the primary purpose of the reasonable charges clause is to ensure fair billing by hospitals,” says Subrahmanyam B, senior vice-president and head, health, commercial lines and reinsurers, Bharti-AXA General. 
 
For instance, if your hospital charges Rs 1 lakh for a surgery that typically costs Rs 70,000, the insurer will pay the lower amount. Since insurers use their discretion, it can cause heartburn to policyholders. However, independent industry watchers say customers should not accept the company’s decision blindly. 
 
“The new regulations say any denial of claim has to be accompanied by a medical reason. Hence, reasonability clause must not be accepted by the policyholders,” says civic activist Gaurang Damani. 
 
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Exclusions, sub-limits and co-payment clauses 
 
Before signing up for any health policy, you need to check what is not covered. All policies exclude certain expenses, impose sub-limits within the overall sum insured and insist on the claimant sharing a part of the claim burden. 
 
In case of exclusions—expenses that insurers need not pay for—the scope for ambiguity has shrunk, thanks to the Irda putting out a list of 199 such expenses as part of standardisation norms. You also need to watch out for the waiting period for various conditions. 
 
For instance, policies do not entertain any claims, except the ones related to accidents, in the initial 30 days. “A general waiting period of 24 months is applicable for named surgeries or illnesses, such as cataract, gall bladder stones, kidney stones, and so on. 
 
For all pre-existing conditions declared and accepted at the time of application, the waiting period is 48 months,” says Kumar. 
 
Sub-limits and co-payment clauses limit the insurer’s liability. In case of a co-payment clause, which is typically part of senior citizens’ policies, insurers could agree to pay, say, 80% of the approved claim, with policyholders having to chip in with the rest. 
 
<keyword id="6406875" type="COMPANY" weightage="40" keywordseo="life-insurance">Life insurance</keyword> 
 
Indisputability clause 
 
This ensures that insurers do not arbitrarily dismiss claims on grounds of inaccurate declaration by the policyholder. 
 
According to Section 45 of the Insurance Act, insurers cannot question a policyholder’s declaration after two years of the date of issuing the policy, citing inaccurate or false statement made in the application or any report of the medical officer. 
 
Free-look clause 
 
The proposition is simple: if you are not happy with the policy that you have been sold, you can choose to return it and get a refund. The clause is meant to be an antidote to mis-selling of policies. Under this rule, you have the option of returning the policy within 15 days of receiving the policy document. 
 
Remember, the period starts from the day you receive the policy documents and not the date of issue. It is applicable to life and health insurance policies with a tenure of three years or more.

Clauses You Must Read Before Buying An Insurance Policy

If you own a car that has engine capacity more than 1000 CC, get ready to pay a hefty premium. The government has agreed to do away with the cap on third party liability of insurance companies in case of grievous injuries or deaths in road crashes. 
 
The Insurance Regulatory and Development Authority has proposed a nearly 50% hike for most categories of vehicles for 2017-18, according to a news report by The Times of India. 
 
It is mandatory for vehicles to have third party insurance while insurance for own damage is optional. In comprehensive insurance policies, which have both components, the share of third party insurance is barely 30%. IRDA has not proposed increase in third party insurance premium only for a few categories of vehicles such as Maruti Alto, Tata Nano and Datsun Go as well as pick-up vans and mini trucks. 
 
But it proposes to increase the premium of cars that have 1,000-1,500cc engines by almost 50%. Sources said the final hike could be 25-30%. It is likely that insurers would push for another round of increase once the Motor Vehicle (Amendments) Bill is passed with the proviso that insurance companies pay the entire compensation awarded by motor vehicle claims tribunal.

Owning a car to get expensive by at least 50% every year. Here's why

New Delhi, Feb 25 () The Department for Promotion of Industry and Internal Trade (DPIIT) on Tuesday notified the government's decision to allow 100 per cent foreign direct investment (FDI) in insurance intermediaries. Intermediary services include insurance brokers, re-insurance brokers, insurance consultants, corporate agents, third party administrators, surveyors and loss assessors. The FDI policy earlier allowed 49 per cent foreign investment in the insurance sector, which includes insurance intermediaries. In its press note, the DPIIT said 100 per cent FDI is allowed in insurance intermediaries under automatic approval route. It said that insurance intermediary that has majority share holding of foreign investors shall undertake measures including incorporation as a limited company under the provisions of the Companies Act 2013; at least one from among the chairman of the board of directors or the CEO or principal officer or MD of the company shall be a resident Indian citizen, shall take permission of the IRDA for repatriating dividend, and shall not make payments to the foreign group or promoter or associate entities beyond what is necessary or permitted. Representations were made to the government that these intermediary services should be treated at par with other financial services intermediaries, where 100 per cent foreign investment is permitted. RR MRMR

DPIIT notifies 100 pc FDI in insurance intermediaries

The <keyword id="120582" type="General" weightage="20" keywordseo="hinduja-group" source="Orion">Hinduja group</keyword> has made an offer to invest an additional ₹300 crore in <keyword id="157626" type="General" weightage="20" keywordseo="reliance-general-insurance" source="Orion">Reliance General Insurance</keyword>. <keyword id="10926" type="General" weightage="20" keywordseo="reliance" source="Orion">Reliance</keyword> General Insurance, a unit of Reliance Capital, needs a cash infusion to maintain solvency levels. IndusInd International Holdings Ltd (<keyword id="1424679" type="General" weightage="20" keywordseo="iihl" source="Orion">IIHL</keyword>), which is owned by <keyword id="28125" type="General" weightage="20" keywordseo="hinduja" source="Orion">Hinduja</keyword>, made the highest bid of ₹9,650 crore for Reliance Capital in a second auction on Wednesday. Reliance General Insurance had sought ₹600 crore cash infusion from lenders in December last year to meet the solvency requirements of the IRDA. The lenders earlier rejected the call for fund infusion from their pocket, putting the onus on the general insurance firm to the incoming investor. The bid amount of ₹9,650 crore will go to lenders who had lent ₹24,000 crore to Reliance Capital. The Committee of Creditors (COC) of Reliance Capital will hold a meeting on Friday where the top officials of the Hinduja group will make a presentation on its resolution plan. Reliance Capital owns a 51 per cent stake in Reliance Nippon Life Insurance and 100 per cent in Reliance Nippon General Insurance. The Hinduja group has a presence in the financial services sector through its stake in Indusind Bank and Hinduja Leyland Finance, a non-banking finance company owned by Ashok Leyland. The group has a housing finance business which is core to its strategy to increase its presence in financial services. At a consolidated level, as on December 31, 2022, the AUM (assets under management) of Hinduja Leyland Finance stood at ₹33,353 crore of which the housing finance business accounted for 18 per cent. In addition to ₹9,650 crore, the company has also offered ₹300 crore capital infusion in Reliance General Insurance, and another ₹50 crore for other expenses. The total value of IIHL's bid is ₹10,000 crore. The total Hinduja bid is ₹1,900 crore more compared to its own bid of ₹8,110 crore in the first challenge mechanism. Torrent, which decided to skip the second auction, had offered ₹8,640 crore in the first auction. The new Hinduja bid is higher by ₹1,380 crore. Torrent has moved the Supreme Court on banks' plans to launch a second auction. The matter will be heard in August. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/india/news/how-to-grant-social-benefits-to-same-sex-couples-sc-asks-centre/articleshow/99815407.cms">'How to grant social benefits to same-sex couples', SC asks Centre</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/news/anil-agarwal-makes-zero-debt-pledge-says-very-comfortable-servicing-debt/articleshow/99815431.cms">Anil Agarwal makes 'zero debt' pledge, says 'very comfortable' servicing debt</a>

Hinduja group offers to infuse ₹300 crore in Reliance General Insurance

New Delhi, Dec 12 () Parliament on Thursday passed a bill to set up a unified authority for regulating all financial activities in international financial services centres (IFSCs) in the country.
 The Rajya Sabha passed the bill by a voice vote. The Lok Sabha had approved the proposed legislation on December 11.
 The first IFSC in India has been set up at Gujarat International Finance Tec-City (GIFT) in Gandhinagar, Gujarat.
 Speaking in the Upper House, Finance Minister Nirmala Sitharaman said the authority would also be responsible for regulating any other IFSC centre which comes up in the country in future as well.
 She was responding to Congress member Jairam Ramesh who said the authority has been set up to just cater to one centre in Gandhinagar.
 Sitharaman said all the laws of land, including the Prevention of Money Laundering Act, will apply on the centres while adding that the unified authority would be subject audit by the CAG.
 On a separate query she said that all transactions at the centre are going to be in foreign currency and therefore there was no question of rupee convertability.
 Giving details about the operations at Gandhinagar centre, the Finance minister said that two stock exchanges have been set up there and a daily trade volume currently stands at USD 4 billion.
 "Besides, there are 13 international banking units operational there..ECB lending has happened from there," she said, adding that the IT enabled financial services has provided 10,000 jobs at the location. 
 The International Financial Services Centres Authority Bill, 2019, was introduced in the Lok Sabha after withdrawal from the Rajya Sabha.
Currently, the banking, capital markets and insurance sectors in IFSC are regulated by multiple regulators -- the RBI, the Securities and Exchange Board of India (SEBI), the Pension Fund Regulatory and Development Authority (PFRDA) and the Insurance Regulatory and Development Authority of India (IRDAI).
The bill amends 14 Acts, including the SEBI Act, the IRDA
Act and the PFRDA Act.
The dynamic nature of business in IFSCs necessitates a high degree of inter-regulatory coordination and it also requires clarifications and frequent amendments in the existing regulations governing financial activities in IFSC.
On the criticism on why it is being set up in Gandhinagar, she said, the Gujarat government had applied for setting up financial sector Special Economic Zone and the approval given by the then Congress-led UPA in 2011.
She also said that there is no limit on how many IFSCs can be set up but others can come up after first centre (GIFT City) becomes fully operational. MSS ANB MR
MR

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