Tag: INSURANCE

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Smart Insurance Choices for FY2024 Financial Preparedness

Securing our investment plans against unforeseen events is crucial. Hence, it’s essential to view insurance as an integral component of the investment strategy, rather than merely a means of protection…writes Vishal Gupta

We all aspire to accumulate wealth and the key to doing that is discipline. Discipline is about investing systematically and for the longer term and more importantly, it is also about protecting our investments. There are unexpected emergencies that may occur and may lead to either not being able to invest that month, or even worse, we may have to liquidate some of the investments to meet those unexpected expenses.

It is critical to ensure that we protect our investment planning against any such eventuality. Therefore, one should look at insurance as a part of the investment strategy, instead of just simple protection.

When we view insurance as a strategic investment instead of an “expense”, we wouldn’t have to deplete our savings in the face of uncertainties, emergencies, or healthcare expenses as we’d already be insured. Hence, preparedness is key for a well-rounded financial plan. When we are prepared, investments focused on building wealth and purchasing insurance can work hand-in-hand, without hindering the growth of either. Health & Life Insurance also provides tax benefits under 80D and 80C.

For example, the recent global crisis caused by the Covid-19 pandemic is a testament to the true value of insurance as a risk mitigation and protective measure against such unforeseen events. Many individuals experienced disruptions in their financial goals as they had to break their piggy banks to manage the escalating healthcare costs during this time. But those who had health and life insurance were better equipped to weather the storm.

At PhonePe, we are focused on helping Indians ‘save their savings’ effectively. For this, it’s critical to have an in-depth understanding of the role of insurance in investment planning, especially in time for the new year, 2024.

Preparing a safety net the right way in FY2024

Did you know that in India, the traditional preference for physical assets and fixed deposits in banks has gradually shifted towards investment in financial assets like mutual funds and stocks? This is a notable shift reported by CRISIL Market Intelligence & Analytics. Interestingly, this trend is reflected in the increasing participation in the stock market, with the National Stock Exchange (NSE) recording a substantial 26 per cent year-on-year rise in demat accounts, reaching 127 million as of August 2023.

Although there is a visible increase in such financial aspirations, many ignore insurance as a critical component in their overall investment strategy. It highlights the need for heightened awareness regarding the importance of financial protection.

Tailoring health insurance for optimal coverage

Imagine this — Mr Rama is a middle-class working professional from Punjab. He dreams of owning his perfect home one day and he has been consistently setting aside funds for the down payment. But what if an unexpected health crisis costing between Rs 5-10 lakh arises during this saving period? This sudden impact on his finances could significantly prolong the time needed to save up for the down payment, potentially extending it by another 3-5 years. But, let’s say Mr Rama has health insurance coverage of say, Rs 10 lakh costing around Rs 700* per month or roughly Rs 8,000* per year. He can easily handle such unforeseen medical expenses and continue his journey toward buying his dream home without sacrificing financial stability.

Always ensure to have sufficient health cover based on health, lifestage, and investment commitments. Another critical factor to consider is medical inflation and one must ensure that health cover is for the right amount based on the current and future medical costs. One could also think of a cover amount as high as Rs 50 lakh or more. Interestingly, even a 5x increase in the cover amount will only lead to a 2x increase in the total premium.

Simply put, get the right insurance cover that is suitable for a lifestyle that won’t compromise other investments and wealth creation plans in case of any medical expense.

Numbers quoted are for rough estimation only and do not represent actual costs involved

Facing the financial impact of unexpected loss with life insurance

Picture this — Mr Srinivasa, a resident of Tamil Nadu, made a significant investment in a Rs 60 lakh house by opting for a 15-year EMI plan. Six years into diligently meeting the EMI commitments, his untimely demise leaves his family grappling with the financial responsibility of settling this EMI for the remaining nine years. Their lack of financial readiness to handle this additional monthly expenditure has resulted in the loss of both the house and Mr Srinivasa simultaneously. However disheartening this scenario may be, it serves as a reminder of the vital role played by Term insurance coverage. Such coverage can provide families with the necessary support to navigate the financial impact of an unexpected loss and safeguard assets they are emotionally tied to.

Term plans prove invaluable, ensuring stability in your family’s lifestyle even in your absence. Ideally, it’s recommended to choose coverage that is 15x-20x times your current annual income, or at the very least, enough to cover any outstanding financial responsibilities, such as loans, debts, and lifestyle expenses. Whether you’re signing up for a Term plan in the upcoming year or adding more to your existing coverage, it’s crucial to align it with your family’s existing lifestyle to shield them from the impact of a potential financial burden due to unfortunate circumstances.

India’s insurance growth: Embracing digital transformation is the future

In the past, purchasing insurance was often a difficult process due to a lack of information and other documentation issues. The Insurance Regulatory and Development Authority of India (IRDAI) is bringing lots of changes to ensure insurance offerings reach everyone so that the vision of ‘Insurance for all by 2047’ can be achieved.

To achieve this goal, it will be critical that Insurance products are easy to understand, easy to buy, and most importantly the best product suited to prioritise one’s needs over everything else.

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Dubai Economy

Insurance scheme for unemployment starts on Jan 1

Rs 10 lakh to kin of govt general insurance employees dying of Covid

Anyone who loses their job as a result of termination of services (except for disciplinary reasons or resignation) is entitled to a maximum three-month cash compensation…reports Asian Lite News

The Ministry of Human Resources and Emiratisation (MoHRE) has announced that the subscription to the Unemployment Insurance Scheme will start on 1st January, 2023, calling on UAE nationals and residents who work in the federal government and private sector to subscribe.

The Insurance Pool, which is represented by Dubai Insurance, is responsible for providing the insurance service. The Pool offers seven subscription channels: the website www.iloe.ae, the smart app “iloe”, Kiosk machines, businessmen service centres, Al Ansari Exchange, bank ATMs and applications, as well as telecommunication bills.

Stemmed from the Federal Decree-Law No. 13 of 2022, the Unemployment Insurance Scheme aims to create a low-cost job safety net that supports employees in their professional journey, providing them with career stability with no cost on employers.

Compensation

Anyone who loses their job as a result of termination of services (except for disciplinary reasons or resignation) is entitled to a maximum three-month cash compensation.

The subscription fees depend on the employee’s basic salary. The first category is those with a basic salary of AED16,000 or less; their subscription fee is AED5 per month (AED60 annually), whereas, the second category is those with a basic salary exceeding AED16,000; their subscription fee is AED10 per month (AED120 annually).

The first category is eligible for a monthly cash compensation reaching up to AED10,000, while the maximum monthly cash compensation for the second category is AED20,000.

The insurance fees can be paid monthly, quarterly, once every six months, or annually. The insurance compensation is calculated at a rate of 60 percent of the employee’s basic salary in the last six months prior to his or her unemployment.

The compensation should be paid within two weeks from the date the claim is submitted. The insured can submit the claim through various claim channels, including the website https://www.iloe.ae, smart app iloe, or the call centre of the Insurance Pool 600599555.

The insured must be subscribed for at least 12 consecutive months to be eligible for a cash compensation. However, they would lose the right to claim the compensation should they leave the country or take up a new job.

Investors – owners of establishments in which they work, domestic workers, temporary contract workers, juveniles under 18 years, and retirees who receive a pension and joined a new job are not eligible to subscribe to the insurance scheme.

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Business

‘God save insurance industry and govt’

Rs 10 lakh to kin of govt general insurance employees dying of Covid

As per the proposals, the government is scrapping the provision of the Insurance Act that stipulates the minimum capital of Rs 100 crore for life, general, health insurance companies and Rs 200 crore for reinsurers…writes VENKATACHARI JAGANNATHAN

The proposed amendments to the Insurance Act 1938 and the Insurance Regulatory and Development Authority Act 1999 alters the basic structure of the insurance laws that was derived from the Malhotra Committee on Insurance Reforms, said experts.

Further the proposals bestow the sectoral regulator a huge power taken away from Parliament, experts added.

Scrapping of the statutory Rs 100 crore startup capital for life and general insurance business and Rs 200 crore for reinsurance business, allowing different kinds of insurers including captives, changing the investment provisions are some of the major amendments proposed by the Indian government to the insurance laws.

The government also proposes to allow an insurer distribute other financial products as specified by and subject to regulations and to services related or incidental to insurance business and

“God save the industry and the government,” was the cryptic comment of a former official of the Insurance Regulatory and Development Authority of India (IRDAI) to IANS.

Allowing regional insurance companies, reducing minimum startup capital, changing investment norms and other measures may result in mushrooming of small insures and the return of pre-1956 period, N. Rangachary, the first Chairman of IRDAI had recently told IANS.

Prior to 1956, there were several hundreds of small life insurers who were issuing policies in a restricted manner and sold in an unrealistic manner, while claims were not paid.

Incidentally the proposed amendments to the insurance laws seems to do precisely the same.

“Insurance companies cannot be compared with banks that have small finance banks, regional rural banks. The banks deal with assets while insurers deal with risks. The relationship between a banker and its depositors is short/medium term. A depositor can withdraw his money from a bank anytime,” Rangachary had said.

“On the other hand, a life insurance policyholder cannot get back his full money when he surrenders the policy. The relationship between a life insurance policyholder and a life insurer is long term, upwards of 15 years.”

Again, in the case of a bank failure, the depositors have some deposit insurance whereas there is no such guarantee for a policyholder of a life/general insurer. Hence, a life insurer should be structured in a failproof manner, he had remarked.

“On a cursory look at the suggested amendments, it is clear that the government is intending to amend the statutory framework for insurance industry very extensively by weeding out provisions that have outlived their utility and usher in changed legal framework to the changed circumstances,” D. Varadarajan, a Supreme Court advocate specialising in company/competition/insurance laws, told IANS.

“Nevertheless, in its endeavour, the IRDAI would be invested with more powers, some of which border on excessive delegation, if the proposals contained in the Bill graduate into an Act of Parliament,” Varadarajan added.

The Department of Financial Services has put out the proposed amendments to the Insurance Act 1938 and the Insurance Regulatory and Development Authority Act 1999 and has called for comments/ suggestions.

As per the proposals, the government is scrapping the provision of the Insurance Act that stipulates the minimum capital of Rs 100 crore for life, general, health insurance companies and Rs 200 crore for reinsurers.

In the place of statutory provision, the government proposes to vest the sectoral regulator IRDAI the power to prescribe the minimum capital required considering the size and scale of operations, class or subclass of insurance business and the category or type of insurer.

The government has also proposed to reduce the amount of net owned funds required for an insurer to be registered to Rs 500 crore from Rs 5,000 crore.

It is also proposed to put a cap on holding by foreign entities at 26 per cent in an insurance co-operative and not more than 74 per cent in an Indian insurance company, subject to such conditions as may be prescribed.

The nature of amendments vary from overhauling existing provisions and enactment of new provisions, including new definitions to give effect to the proposed changes, Varadarajan said.

According to him, the proposed Bill seeks to introduce new definitions of terms, such as, ‘captive insurer’, ‘class of insurance business’, redefinition of ‘health insurance business’, ‘insurance business’, ‘Indian insurance company’, ‘insurance cooperative society’, ‘intermediary or insurance intermediary’, ‘personal accident insurance business’, ‘premium’, ‘Principal officer’ , ‘sub-class of a class of insurance business’, ‘surveyor and loss assessor’, ‘travel insurance business’ and others.

The Bill seeks to prohibit transaction of insurance business by certain persons.

The provisions in regard to registration of insurers, class or sub-class of insurance business, and IRDAI is proposed to be invested with more powers in this regard, including cancellation of registration.

The government has also proposed to allow general insurers transacting specialised lines of business like motor/travel and others.

The government has also proposed to stipulate the minimum amount of motor third party insurance policies to be underwritten by standalone motor insurance companies that may be set up.

The question that pops up is whether the government would scrap the administered pricing regime for motor third party premium when motor insurance companies are allowed.

According to Varadarajan, drastic amendments are suggested in regard to investments by insurers by amending and deleting some of the existing provisions.

The IRDAI is also would be given extended power to give directions, including in regard to insurance intermediaries.

The provisions relating to insurance agents are also in for amendments, including stiff penalty for agents and insurance companies in cases of omissions and commissions by the agents.

Curiously, the insurers are also sought to be penalised for the violation of code of conduct by the agents, Varadarajan said.

“The composition of both the General Insurance Council and Life Insurance Council is sought to be amended, inter alia, providing for a Central Government nominee on the Councils, which would not gel with the professed self-regulatory mechanism as originally conceived when these Councils were created under the earlier legal dispensation,” Varadarajan remarked.

The proposed amendments to the Insurance Regulatory and Development Authority Act 1999 mostly consequential in nature keeping view of the proposed amendments to the Insurance Act.

Varadarajan said one significant amendment is a proposal to increase the retirement age of IRDAI Members to 65 years, on par with the Chairman.

The scope of delegation of powers of the Authority is also sought to be broad-based by including Members and officers of the Authority as delegates. However, the power to make regulations and registration of insurers are confined to the Authority only, and, as such these two powers are not to be delegated, Varadarajan added.

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Arab News Business Saudi Arabia

Bupa Arabia becomes most valuable insurance company of ME

Bupa Arabia was also named the “Middle East Health Insurance Company” at the Middle East Insurance Industry Awards – supervised by Ernst & Young…reports Asian Lite News

Bupa Arabia continued to shine even in the face of various COVID_19 related challenges last year, as it dominated a number of regional and international awards as well as global rankings in the health insurance, digital innovation, and sustainability fields among others.

The leading health insurer topped Brand Finance’s list of the most valuable insurance companies in the Middle East in 2021, a testament to Bupa Arabia’s efforts in providing innovative healthcare services to millions of people, within the framework of the Council of Cooperative Health Insurance.

Bupa Arabia also topped the insurance companies for Forbes Middle East’s annual rankings of the 100 most powerful companies in the region for 2021, which includes the largest, most profitable, and most valuable companies in the Middle East.

Tal Nazer, CEO of Bupa Arabia, said the company’s presence in the Forbes Middle East and Brand Finance rankings, acknowledges the success of its strategy of adapting to the needs of the evolving industry, making a difference in healthcare, and most importantly, improving its members’ health.

Bupa Arabia also placed 13th on Brand Finance’s most valuable brands in Saudi Arabia rankings, six places ahead of its position in the previous year’s rankings, driven by a growth in its brand value by 22.7 percent, increasing it to $618 million (SR2.31 billion).

Bupa Arabia remains in the lead

In other achievements, the International Business magazine named Tal Nazer as the “Best CEO of Insurance Company in 2021,” and Bupa Arabia as the “Best Health Insurance Company of 2021.”

The health insurer also won the “Best Innovation for a Health Insurance Product” recognition for its Bupa Parents service, and was named the “Best Leading Investor Relations in Insurance” for applying the highest quality standards in customer service and products in 2020, by the US Journal of World Economic Magazine, which enjoys high credibility among decision-makers and influencers in various financial sectors.

Bupa Arabia was also named the “Middle East Health Insurance Company” at the Middle East Insurance Industry Awards – supervised by Ernst & Young.

Prominent Digital Initiatives

Bupa Arabia won the “Best Health Insurance Company of 2021” and “Digital Innovation in the Health Insurance Sector” awards at the Golden Shield Awards for Excellence, held on the sidelines of the InsureTek Regional Conference. Meanwhile, at the 2021 Global Business Outlook Awards, it won the “Best Health Insurance Provider Award” and “Digital Innovation Award in the Insurance Sector” for its Tebtom program.

Nazer said the multiple award wins reflect Bupa Arabia’s leadership in digital transformation in the insurance sector. The company recently launched the revolutionary Bupa Click service, aiming to provide “integrated healthcare with one touch.” Moreover, Bupa Arabia’s Tebtom program provides various innovative healthcare services such as home vaccination for children, doctor’s consultation (Bupa Doctor), telemedicine and others, while the Rahatkom provides an integrated healthcare experience for members, from the moment they enter the hospital and throughout their time there.

Aspiring work environment

Bupa Arabia’s achievements and awards not only recognize its excellence in insurance but also in human resources, as it was named the “Best Employer” in the Middle East by the CIPD as well as won in the “Best Employee Engagement Initiative” category.

In addition, at the Gulf Sustainability Awards, Bupa Arabia won the “Best Practices in the Workplace and Human Resources” award, while at the Global Brand Awards, it won the “Best Mobile Insurance App 2021” award for its innovative Bupa Arabia app.

In the same vein, Bupa Arabia won an award at the LinkedIn Talent Awards MENA. The awards, which are given out by LinkedIn, a global network specializing in professional communication, see intense competition among a wide range of companies, institutions and recruitment destinations in the region.

Nazer said that Bupa’s continuous achievements are due to its dedicated team members. “The COVID-19 pandemic has not affected our performance, thanks to the continuous efforts of the team that deserves gratitude and appreciation, and we look forward to continue developing our services, so that we always remain at the forefront,” he said.

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Business Finance Investment

Saurabh Tiwari : ‘Policybazaar to drive pivotal change in consumer behaviour’

Importantly, the amalgamation of digital and physical models has helped bridge the trust deficit for customers who have online research at their fingertips but prefer an offline purchase…reports Asian Lite News

The combination of physical and digital — phygital — model of operations helped new-age insurance firm PolicyBazaar in tapping the potential of unexplored markets, the company’s Chief Technology Officer(CTO) Saurabh Tiwari told.

The pandemic pushed up the life insurance penetration in India to almost the same as that of the global average. Policybazaar sees this trend as a “secular trend” and it believes it will continue to drive this “pivotal change in consumer behaviour”.

“The transience of life is a brutal reality that applies equally to everyone and Indians don’t have the comfort of standardised social security to turn to,” the CTO said adding that the pre-pandemic term insurance penetration rate, yet, painted a grim picture.

“However, the past two years of Covid-19 have helped break the inertia when it comes to the purchase of insurance products, especially term insurance. With digitisation facilitating ease of access and information, consumers are now better equipped to take charge of their financial decisions and secure their future with just a few clicks. More evidently, during the second wave, Google search in India for ‘term insurance’ was the highest in the last five years. That is considerably huge progress. This indicates a sharp rise in awareness and demand for insurance,” he said.

Asked how the company will ensure a seamless ‘phygital’ experience across both physical and digital worlds, the CTO said: “Our aim is to unify both these models to leverage the omnichannel approach for providing our customers with a robust, 360-degree service and support system.”

Historically, insurance worked on an offline model and it still constitutes a huge share of the overall distribution pie – which is still close to 80 per cent. After the advent of digitisation, online channels have also been a market-defining pillar for the industry in order to serve the customers.

Importantly, the amalgamation of digital and physical models has helped bridge the trust deficit for customers who have online research at their fingertips but prefer an offline purchase.

Further, when asked how the company is using AI/ML, and data analytics, the CTO said: “As consumer behaviour goes through a massive change with better access to research and data available at their fingertips, they can easily compare online, seek assistance and make better choices. The long legacy of data that we have, enables them to do that. Conventionally, the way insurance is bought and sold has broadly been based on static parameters.

“The company is leveraging the potential of automation to entirely turn around the customer experience and also for making the process more cost and time-efficient. Deploying technology helps us efficiently assess the risk profile of a customer which is a breakthrough of sorts for underwriting.

“Furthermore, the CTO said that the cloud technology has helped the insurance company rapidly build its applications over the cloud. For scalability and elasticity, the platform offers all the building blocks for the application with managed services like Amazon RDS, ALB, CloudWatch, ECS with Fargate and WAF/Shield. With AWS we got the native advantage of provisioning resources at will.

“Also, monitoring, managing and decommissioning resources are easier and require fewer clicks. In terms of business outcomes, it had experienced the following key benefits attributed to running on Amazon Web Services: a. Cost reductions: Instead of having to upfront invest heavily in data centres based on peak load, the ability to pay only when you consume computing resources, and pay only for how much one consumes is a big advantage. Since this is an opex model it doesn’t require significant upfront investment.

“b. Quick time to market: In a cloud computing environment, new IT resources are only a click away, which means that one can reduce the time to make those resources and applications available to its developers from weeks to just minutes. It helps in getting the required resources almost 100 per cent in-time.

“c. Effective use of resources: It operates and manages the infrastructure and development processes at scale. Automation and consistency help in managing and utilising the resources to the fullest. The resource utilisation of the critical resources of ECS+FARGATE(Docker), RDS, Elastic-Cache is 98 per cent-99 per cent. It monitors AWS resources via Amazon CloudWatch’s resource utilisation report.

“d. Faster deployment and Reduced latency: It easily deploys its applications in multiple regions around the world with just a few clicks using code, deploy and Jenkins. With this, it can provide lower latency and a better experience for its customers at a minimal cost.

“e. Improved availability: AWS has helped improve the availability of business-critical information, applications, and services. Resource availability is in high 99 per cent and it uses the ASG feature with multiple templates and multiple resource types.

“f. Management efficiency: The infra and application management is far easier via an AWS portal on the browser, as it can be accessed from anywhere.

“g. Improvement in Risk Management: AWS has helped in risk improvement in case of scaling, availability and recovery during business hours.”

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Business Finance Investment

‘Time To Create A Safety Net’

During volatile times, especially while living abroad i.e. away from your home country, it makes sense to ensure that you safeguard yourself and your loved ones when your circumstances change for the worse. A term life policy with global coverage and add on riders like the accidental cover, critical illness cover and disability insurance is considered a must-have shield … Asian Lite’s Iqbal Azeez meets Neeraj Gupta, CEO, Policybazaar.ae, a leading online insurance aggregator in the UAE.

  1.   How the pandemic changed personal finance of the Indian expat population in the Middle East?

The Covid-19 pandemic has been a catalyst in changing people’s attitudes towards money. The spending and purchasing habits of the Indian expats had changed due to the pandemic outbreak. Expats are now prioritizing needs over wants. They are shopping only for the essential goods and services that too when there are offers and discounts available in the market. Thus, the pandemic was like a wake-up call for them to save and invest money for future contingencies.

  •  What is your advise to the Indian expatriates in the Gulf and other parts of the world?

Indian expatriates are always on the lookout for financial schemes/or investments that help them to provide a safety net and ensure their family’s future financial needs are met. Thus, buying a term insurance policy provides a supporting wall until the expat’s dependents can stand on their feet financially. The sum insured of this is the amount your family/nominee will receive in case of any unfortunate incident such as death, disability, or critical illness. Make sure the sum insured is significant enough for your family to live a stress-free and financially independent life after factoring in inflation. Also, one should choose the maximum available policy period as doing this will ensure a relatively lower premium too.

Neeraj Gupta, CEO, Policybazaar.ae

Secondly, buying an individual health insurance plan can help expats reap the benefits of extensive coverage options and save them from the burden of paying exorbitant medical bills for treatment at private hospitals.

  •  What is your take on the Insurance sector in the UAE?

The life insurance penetration in the UAE is currently at 0.5 per cent, this is likely to grow as Covid-19 has increased the awareness of financial and health risks among consumers. This has resulted in increased demand for life insurance and related products such as individual health covers, critical illness covers etc. Despite the increase in demand, Covid-19 has significantly impacted distribution capabilities on the intermediated side of the industry, which relies on physical contact – an obviously unworkable model during the past several months. As a result, the pandemic has ushered in a renewed focus on the ability to reach consumers directly via digital means.

  •      How the pandemic affected the Sector?

The insurance sector is hard hit by the outbreak of the pandemic. The first and foremost concern that arose immediately out of the COVID-19 outbreak was the continuity of business operations along with employees and partners protection. The insurance market in UAE has approximately lost 48% of its market share (as per KPMG international report) since the outbreak began, car and home insurance being the most affected line of business. While health and life insurance witnessed a slow fall in numbers. As the insurance providers are struggling with shrinking market shares and profit levels there is a very high probability that the payable premiums will be increased in the next year to cover the losses incurred.

  •      How robust is Indian insurance sector?

The insurance industry in India has seen major growth in the last decade along with an introduction of a huge number of advanced products. This has led to tough competition with a positive and healthy outcome. India’s insurance penetration was pegged at 4.2% in FY21, with life insurance penetration at 3.2% and non-life insurance penetration at 1.0%. In terms of insurance density, India’s overall density stood at US$ 78 in FY21 (INDIAN INSURANCE INDUSTRY REPORT , NOVEMBER, 2021).

Also, the insurance sector plays a dynamic role in the wellbeing of India’s economy. It substantially increases the opportunities for savings amongst the individuals, safeguarding their future and helping the insurance sector to form a massive pool of funds.

  •      What are trends and demands for insurance sector?

Throughout 2022 and the years to come, we expect the insurance industry to undergo a digital transformation.  As customer expectations change, insurers will have to adapt their business model to meet new demands. Insurers focusing on delivering customer-centric products and services will succeed. Similarly, data-driven insurance, marketing and sales will be the next elements of insurance to be automated. Data-driven marketing is improving insurance, showing insurers where the gaps in the market lie. By paying attention to which products customers are demanding more, insurers can spend more time innovating new products and, crucially, marketing those products to the right audience. Artificial Intelligence (AI) too will spread wider throughout the industry as more insurers gain confidence with this new technology.

  •    What steps an expat should take to protect his family and himself in this time of uncertainty?

During volatile times, especially while living abroad i.e. away from your home country, it makes sense to ensure that you safeguard yourself and your loved ones when your circumstances change for the worse. A term life policy with global coverage and add on riders like the accidental cover, critical illness cover and disability insurance is considered a must-have shield. Secondly, all expats must build an emergency fund with their salary. One might have a job now, but who knows what might happen in the near future. The emergency fund should be saved in an easy-to-access account, such as a bank account or high-yield savings account to help during unprecedented times.

  •      Your advise to the expat communities in the UAE

It’s advised that using the private system, expats must buy individual health insurance policies in the UAE  to save themselves from the burden of exorbitant healthcare costs. Also, they must reduce their credit card debts. Keeping a frequent check of their credit score would help them to monitor their financial actions. Having a low credit score can lead to imposing higher interest rates, more expensive insurance, and other financial issues like a rejection of a loan or new credit card application. Also, expats must invest their money to generate a passive income via making investments in blue-chip equity stocks, monthly income plans, pension plans, gold bonds and fixed-income investments.

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Business India News

Advantage for insurance companies as LIC loses 8% market share

LIC is struggling in the retail segment, the report said. After the rebound in November ’21, LIC’s growth in retail in December ’21 slowed, and was materially lower than the private sector…reports Sanjeev Sharma

Private sector insurance companies have gained 8 per cent market share from LIC in the last 2 years.

On a 2-year CAGR basis, the retail weighted received premium (RWRP) growth in YTDFY22 is 10.2 per cent for the private life insurers and (-) 6.6 per cent for LIC. This divergent growth trend has led to the private sector gaining 8 per cent market share from LIC in the last 2 years, Emkay Global Financial Services said in a report.

LIC is struggling in the retail segment, the report said. After the rebound in November ’21, LIC’s growth in retail in December ’21 slowed, and was materially lower than the private sector. This sustained undergrowth by LIC has meant that it has consistently lost market share in retail.

With its unchanged way of doing business over decades, LIC may lose its stronghold in the retail life segment, particularly in the high-ticket segment, the report said.

With the bank channel increasingly becoming important for savings product distribution and digital channels becoming important for retail protection, LIC may witness turbulent times in terms of growth due to its heavy reliance on the agency-led distribution mix. The sustained growth outperformance by Top-4 private players (SBI Life, HDFC Life, ICICI Pru and Max Life) meant that the RWRP market share of these four together has crossed LIC’s market share for YTD FY22 again in December 2021, the report said.

Notwithstanding the temporary disruption, the overall, developments in FY22 validate the long-term trend of a gradual shift of the retail life insurance market to private players with strong brand and distribution reach, it said.

Maintaining strong momentum, RWRP for private insurers increased by 29.4 per cent YoY in December ’21, leading to YTD FY22 RWRP growth of 30 per cent YoY. Growth for private players seems to be largely driven by an increase in the ticket sizes, as the new retail policy count grew by just 13.3 per cent YoY in December ’21.

LIC’s RWRP saw a YoY growth of meagre 6.2 per cent in December ’21 and 5 per cent for YTD FY22. The individual policy count for LIC grew by 9.7 per cent YoY for YTD FY22. On 2-year basis, the private sector delivered 10.6 per cent CAGR, whereas LIC’s RWRP declined at 3 per cent CAGR.

Growth driven by increased ticket size is reflected in the shift of product mix toward ULIPs and non-par products. These factors corroborate the long-term trend of a gradual shift of the retail life insurance market to large private players with strong brand and a wide banc assurance network.

The life insurance industry saw its growth momentum suffering a temporary disruption in January ’22 led by Omicron surge led restrictions affecting mobility and overall business activities. The retail weighted received premium (RWRP) growth slowing to 6.9 per cent YoY in January ’22 from 21.2 per cent seen in December ’21. Despite this slowness in January ’22, the YTDFY22 RWRP growth for the sector remains strong at 18 per cent YoY.

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Business India News

No chief yet, Indian insurance sector in limbo

The industry officials told that IRDAI had gone into micro-managing the sector with various regulations warranting more structures for monitoring resulting in undesirable outcomes…Writes Venkatachari Jagannathan

Is there a need for a Chairman for Insurance Regulatory and Development Authority of India (IRDAI) is the question that has started popping up.

On Wednesday a reporter asked ICICI Lombard General Insurance Company Ltd’s officials at a press meet about the need for a Chairman to head IRDAI?

The sectoral regulator has been functioning without a Chairman since May 2021 and it is business as usual at the Hyderabad headquartered office with the savings of over Rs 4 lakh per month as salary per month.

A senior industry official preferring anonymity told IANS: “Perhaps the government can give the necessary powers to the IRDAI Members and abolish the Chairman’s post. The other option is to have IRDAI as one more wing of the Reserve Bank of India (RBI).”

Continuing further the official added: “The industry is waiting for an ‘Annaatthe’ or an action oriented Chairman for IRDAI as many things are in a limbo.”

“The existing Members are not even responding to the letters/mails sent to them. At least the earlier Chairman used to respond to the letters and would meet the industry officials when a meeting was sought,” the official bemoaned.

What the official seems to be true as queries sent to some of the Members by IANS on several aspects were not even acknowledged nor they answer or return the calls.

Meanwhile, the government has called for applications for the post of Member (Non-Life) as the incumbent T.L.Alamelu’s tenure is ending in May, officials said.

Be that as it may, industry officials had told that the incoming IRDAI Chairman has important tasks like setting the house in order, working towards its core mission of policyholder’s interest, speeding up the new company licensing process, avoiding micromanagement and others.

They also said upward revision of motor third party premium, simplification of its regulations, leveling the playing field are some of the other areas, the officials added.

Industry officials told that the IRDAI has not licensed any new insurer during the past couple of years.

Even the Andhra Pradesh government’s initiative to set up a crop insurance company is getting delayed, they said.

“Globally in the insurance sector, many things are changing focussed on safeguarding the policyholder’s interest, growing the industry and making the players remain solvent,” a head of a large non-life insurer had told on the condition of anonymity.

The industry officials told that IRDAI had gone into micro-managing the sector with various regulations warranting more structures for monitoring resulting in undesirable outcomes.

“The moment you go into granularity, it takes away the focus on insurance. The IRDAI should first address the structural issues,” a CEO of a private insurer told.

N.Rangachary, the first IRDAI Chairman, told that it is time to do a review of IRDAI since it is more than two decades old and several senior industry officials have voiced their views to.

“There should be a review committee to go into all regulatory aspects. It is time to see whether the original goal of forming the regulatory body has been fulfilled and if not, the action to be taken,” Rangachary suggested.

Industry officials also told that IRDAI should not be a parking lot for retired bureaucrats as a post retirement perk.

“What kind of energy can a retired bureaucrat or an official from public sector insurance companies bring in? The financial services industry is changing fast. But the insurance regulator is still in the year 2000,” a CEO of an insurance company not wanting to be named told.

“There is nothing wrong in having a seasoned civil servant as the Chairperson of the Authority, who can bring to bear her/his unalloyed administrative capabilities, ably assisted by the full-time Members, who are from insurance background, viz., life, non-life, reinsurance and actuarial, which has been the case as of now,” D. Varadarajan, a Supreme Court lawyer specialising in Insurance and Corporate Laws and a Member on KPN Committee on Insurance Laws Reforms told.

“In the past, the Government has also experimented with industry insiders as the Chairperson,” he added.

Industry officials also told that the ease of doing insurance business in India is almost nil.

“Ease of doing insurance business in India? You must be joking. One should ask the industry players on how IRDAI is a control freak. The licence permit raj is in full force in the insurance sector,” a senior industry official preferring anonymity told

The IRDAI not only licences the insurers, intermediaries but also the outsourcing agencies like the healthcare claim processing companies.

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