About Me

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Trichy, Tamil Nadu, India
Working as an Assistant in LIC of India, Rockfort BO, Trichy, TN. Having a strong belief that LIC's welfare is our welfare and always trying to work towards that. Also functioning as an office bearer of AIIEA Thanjavur Division.

Sunday, January 31, 2010

SBI Life Policyholder paid 1 Lac.; Received 10 K!

Here is a First Premium Receipt, Foreclosure Letter and relevant cheque of a SBI Life Policyholder. According to him, he paid a single premium of Rs.1 Lakh and the SBI Life Agent remitted it as yearly premium, without his consent.  Whatever it may be, he paid Rs.1,00,000.00 on 8.3.2006 and SBI Life foreclosed the policy and refunded him Rs.10,865.80 on 7.9.2009.




Courtesy: x+ Rtn.V. Meenakshi Sundaram,
                       Professional Agent,
                       Life Insurance Corporation of India &
                       The Oriental Insurance Co Ltd,
                       Trichy.

Thursday, January 28, 2010

Death Claim Settlement Ratio 2008-09

Settlement ratio of individual death claims by Life Insurance Cos. during 2008-09
Compiled by Arivukkadal 

Tuesday, January 26, 2010

Ready Reckoner for Nischay Returns

A ready reckoner for Jeevan Nischay returns.


Sent by:
Mr.RAKESH D UPADHYAY
DEVELOPMENT OFFICER, Surat.

Lapse ratio of ICICI - 53%, Aviva - 59% - Pvt. Cos.' Lapse Ratio doubled in 2008-09

According to the Insurance Regulatory and Development Authority (Irda),around 9.1 million policies lapsed in 2009 and some private sector insurershave shown a lapse ratio as high as 50% or even more. In fact, for the private players, the value of lapsed policies almost doubled in2009.

The lapse ratio for ICICI Prudential Life Insurance Co. Ltd, the life insurance arm of India’s largest private sector lender ICICI Bank Ltd, stood at 53% in 2009, up from 40% in the previous year.  
In terms of lapse ratio, Aviva Life Insurance Co. India Ltd, leads the list with 59% policies lapsed.
The Reliance-Anil Dhirubhai Ambani Group-controlled Reliance Life Insurance Co. Ltd saw its lapse ratio almost double—40% in 2009 against 21% a year ago.
The lapse ratio for India’s largest and the only state-owned life insurer Life Insurance Corp. of India (LIC) declined to 4% for 2009 from 6% in the previous year.

Saturday, January 23, 2010

Wednesday, January 20, 2010

Presentation of modified Market Plus I (191)

Market Plus I (191) is being relaunched with modifications required by the new guidelines of IRDA.  Here is a simple presentation to explain the changes.

Market Plus Presentation

Friday, January 15, 2010

Tuesday, January 12, 2010

Our SMS services now accept new members

Dear Friends,
For the past several days, our SMS services did not allow new members to join. Now it has been rectified (after changing my personal mobile's sim, based on which the services are being run!!)

We run two separate FREE SMS services
for LIC Agents and LIC Policyholders.

For LIC Agents we send Daily Good Morning - motivational cum reminder of available days of the current year, Daily NAV, Daily Stock Market results and other news like competition, plan changes, new plan, etc. related to LIC Agents.
Any LIC Agent can join this service by sending a
SMS from their mobile as
JOIN LICTRY
to
9219592195 or 567678

For LIC Policyholders we send Daily NAV, Daily Stock Market results, New Plan of LIC, etc.
Any LIC Policyholder can join this service by sending a
SMS from their mobile as
JOIN LICGNAV
to
9219592195 or 567678

Both the services are 
FULLY FREE. 
There is no restriction on number of members.
So You can join all your friends to the respective service!

Monday, January 11, 2010

Guranteed NAV offered by Private is a Gimmick

Highest NAV guaranteed,
but not the best returns!
There’s no guarantee that your money would be invested in the market. In fact, it may move entirely into debt. Then, there are high costs to deal with!
Deepti Bhaskaran
What do you think when you see the giant ads promising you the highest net asset value (NAV) in a unit-linked insurance plan (Ulip)? Most of us would believe that we’d get the highest possible return with zero risk.
But knowing, as you do too, that nothing comes for free, we put all the products that are guaranteeing NAVs under scanner. The quick conclusion: your returns will be between 6% and 15% in the long term. Shave off another 3% for cost and suddenly the guarantee looks a bit weak.

Concept
Essentially, these are capital guarantee products that ensure that the amount you invest does not lose value and you get some upside of equity. It is erroneous to think that you get Sensex-linked return, with zero risk. Ashwani Gujral, chief market strategist, Ashwanigujral.com, a stocks investment advisory portal, says: “These funds can’t guarantee the pure return of an equity fund. To guarantee returns on equity, you need to assume the risk on equity.”
Let’s understand how these funds work. Most of them use an investing strategy called dynamic hedging or constant proportion portfolio insurance (CPPI).Under this, the fund manager will constantly reallocate money between debt and equity classes to assure the previous highest NAV.
In year one, your investment will be split between debt and equity in such a manner that you get an assured NAV of Rs10 at the end of 10 years. Over the year, if the equity market goes down, your capital stays put as you have bonds. But if the market goes up, you will see the NAV rising. So, let’s say, we are at an NAV of Rs15 after a year and the market sinks 15%. The fund manager will sell equity and buy bonds to secure the highest NAV till then.
In a market that has no volatility, the product will work because the NAV will go up only in a linear manner. But real life is less neat. Each time the market falls and your allocation in debt rises, the reverse allocation to equity may not happen when markets recover. Remember, the debt part of your portfolio is holding bonds that ensure the highest NAV at maturity. So over a period of time, your portfolio in equity may become smaller and smaller and would move towards a pure debt fund.
Also See High Costs (in downloads section)
Says Shashi Krishnan, chief investment officer, Bajaj Allianz Life Insurance Co. Ltd: “Depending on how much the markets fall, and at what point during the tenure, we reserve the right to exit the stock market and keep all the money in debt. ” Given the “go-anywhere” mandate—or 0-100% allocation in equity, debt and money market instruments—that the policy document allows, these funds can technically move fully into debt and stay there, making your Sensex-linked dream just that. A dream.
Says Manish Kumar, head (investments), ICICI Prudential Life Insurance Co. Ltd: “Since these have exposure to both equity and debt asset classes, under normal circumstances, the returns can be somewhere between what a debt fund and an equity fund would give.” In the long term, that’s between 6% and 15%.
Has the product started looking less happy? There’s worse to follow. 


Costs and more
The guarantees come at a cost making these products some of the most expensive in the market. Also, the guarantee frees them from the cost caps introduced recently.
You need to pay an annual cost for the guarantee, apart from the fundmanagement fee.
ICICI Pru’s Pinnacle offers the highest NAV in the first seven years of the policy and charges 0.10% above the fund management charge of 1.35%. Result? Your returns are about 3 percentage points lower—a 15% return will mean a post-cost return of 12%.
These plans also look like investment plans masquerading as insurance plans. The sum assured is capped at five times the premiums (on a premium of Rs1 lakh, you will get a maximum sum assured of Rs5 lakh). Also, most of these are available for a term of up to 10 years. An insurance cover is necessary for most people (other than Shah Rukh Khan and Sachin Tendulkar, who do need insurance) till they retire. So a 10-year policy with just a Rs5 lakh cover looks very much like an investment product under the garb of an insurance policy.
Worse, this guarantee is available to you only on maturity, usually 10 years. If you die during the term, your nominees will get the prevailing value of the fund—the guarantee on NAV works only if you live till the end of the policy. 
Should you buy?
Guaranteed products work for investors who do not want a risk to their principal amount, but would like a small upside of equity. If you are looking for a Sensex-linked return kicker with zero risk, please get real. Such products do not exist.
Says Manik Nangia, corporate vice-president and head (product management), Max New York Life Insurance Co. Ltd: “It is possible that the implications of such structures are not well understood. We believe this can create unreasonable expectations. For instance, the allocation to debt can increase substantially when the market falls, while the consumer may have bought on the premise of participating in equity. Besides, there is criticism that this technique necessitates selling equity holdings when the market falls and that is opposite to the principle of value investing for long-term returns.”
Says Veer Sardesai, a Pune-based financial planner: “ There is lack of transparency on asset allocation and the insurer doesn’t guarantee that he would stay invested entirely in the stock market during the term. So, we don’t know what high is guaranteed.
If you are a risk-averse equity investor and can lock in money for 10 years, look at index funds to ride the Sensex and Nifty.
Courtesy: Livemint
(PDF version of this article and a Graph about costs are available in our Downloads section)

Tuesday, January 5, 2010

LIC now holds 6.86% in Reliance Industries

The Life Insurance Corporation bought 2.5 crore of these, tantamount to 0.79% stake. As of September 30, LIC held 6.07% stake in RIL. After Monday’s deal, its stake stands at 6.86%.  LIC is the top shareholder among institutions in the company.  Reliance Industries Ltd raised Rs 2600 crore ($559.5 million) by selling 25 million shares at a 5% discount to Life Insurance Corp of India.  (Shares in Reliance Industries were traded in the market at 1,069.80 rupees at 0425 GMT on Monday.)  RIL merely said the shares were sold at Rs 1,035 each, a discount of around 5% to the market price, in a statement on Monday.

Sunday, January 3, 2010

News about a Pvt. Ins. Co.

Tamil Magazine Nakkeeran Dt.02.01.2010 has published a report with photo on page No.11
about a policyholder's bitter experience with ICICI Pru.
Take it to public!
(I do not have a scanner. If any of our friends has a scanner, please send me a scanned copy to publish here!)

Modifications : Jeevan Saathi Plus (197)

LIC’s Jeevan Saathi Plus (Plan No. 197)

I. MODIFICATIONS UNDER THE PLAN:


Under Regular premium policies:

a) Minimum Premium:

EXISTING

MODIFIED

Other than monthly ECS mode:

Rs. 10,000 p.a



Monthly ECS mode: Rs. 1,000 p.m.

Other than monthly ECS mode:

Rs. 10,000 p.a. for terms 15 to 20 yrs. Rs. 15,000 p.a. for term 10 yrs.


Monthly ECS mode:

Rs. 1,000 p.m. for policy terms 15 to 20 yrs. Rs 1,500 p.m. for policy term 10 yrs

b) Policy Term:

EXISTING

MODIFIED

10 to 20 years

10 Years & 15 to 20 years


Under Regular premium policies & Single premium policies:

a) Fund Management Charge:


EXISTING

MODIFIED

Bond Fund

0.60% p.a.

0.50 % p.a.

Secured Fund

0.80% p.a.

0.60 % p.a.

Balanced Fund

1.00% p.a.

0.70 % p.a.

Growth Fund

1.20% p.a.

0.80 % p.a.


b) Right to revise charges:

Fund Management Charge: The Maximum Charge for each Fund will be as follows:


EXISTING

MODIFIED

Bond Fund

1.20 % p.a.

1.00 % p.a.

Secured Fund

1.60 % p.a.

1.10 % p.a.

Balanced Fund

2.00 % p.a.

1.20 % p.a.

Growth Fund

2.40 % p.a.

1.30 % p.a.


c) Annualized Premiums shall be payable in multiple of Rs. 1,000 for other than ECS

monthly. For monthly (ECS), the instalment premium shall be in multiples of Rs. 250/-.


II. FUND MANAGEMENT CHARGE UNDER EXISTING POLICIES:

With effect from 1st January 2010 under all the existing policies of LIC’s Jeevan Saathi Plus

Plan (i.e. policies taken prior to 1st January 2010) the fund management charges shall be at

the revised rates as applicable in case of the policies issued with effect from 1st January 2010.


III. POLICY DOCUMENT:

Existing Policy Document shall be used with the following modifications:

New UIN (Unique Identification Number).

An endorsement shall be required to be attached as per Annexure I enclosed.

The relevant items in the existing policy bond corresponding to the items given in the endorsement shall be required to be cancelled.

Needless to add, at the time of fresh printing of policy document these changes shall need to

be incorporated.


IV. PROPOSAL FORM:

Existing Proposal Form shall be used after modifying the UIN (Unique Identification

Number). Further, it has been decided to add another question as given below. The same may be added while printing the new proposal form. For existing stock of proposal forms a rubber stamp may be used to add the question.

Question 4 c) Is your life now being proposed for another assurance or an application for revival of a policy on your life or any other proposal under consideration in any office of the corporation or to any other insurer? If yes, give details.


The above question has to be added in both the forms (i.e. to be filled by Principal Life

Assured and Spouse Life Assured).


All other terms and conditions of the plans shall remain unchanged.

These modifications will come into force with effect from 1st January 2010.

Modifications: Child Fortune Plus (194)

LIC’s Child Fortune Plus (Plan No. 194)

I. MODIFICATIONS UNDER THE PLAN:


Under Regular premium policies:

Maximum age at entry for child:


EXISTING

MODIFIED

Age of child upto 17 yrs lbd

Age of child upto 10 yrs lbd

Under Single premium:

Minimum Premium:


EXISTING

MODIFIED

Rs.25,000

Rs.40,000

Under Regular premium policies & Single premium policies:


a) Fund Management Charge:



EXISTING

MODIFIED

Bond Fund

0.60% p.a.

0.50 % p.a.

Secured Fund

0.80% p.a.

0.60 % p.a.

Balanced Fund

1.00% p.a.

0.70 % p.a.

Growth Fund

1.20% p.a.

0.80 % p.a.


b) Right to revise charges:

Fund Management Charge: The Maximum Charge for each Fund will be as follows:



EXISTING

MODIFIED

Bond Fund

1.20 % p.a.

1.00 % p.a.

Secured Fund

1.60 % p.a.

1.10 % p.a.

Balanced Fund

2.00 % p.a.

1.20 % p.a.

Growth Fund

2.40 % p.a.

1.30 % p.a.


c) Annualized Premiums shall be payable in multiple of Rs. 1,000 for other than ECS

monthly. For monthly (ECS), the instalment premium shall be in multiples of Rs. 250/-.

II. FUND MANAGEMENT CHARGE UNDER EXISTING POLICIES:

With effect from 1st January 2010 under all the existing policies of LIC’s Child Fortune Plus

Plan (i.e. policies taken prior to 1st January 2010) the fund management charges shall be at

the revised rates as applicable in case of the policies issued with effect from 1st January 2010.

III. POLICY DOCUMENT:

Existing Policy Document shall be used with the following modifications:

New UIN (Unique Identification Number).

An endorsement shall be required to be attached as per Annexure I enclosed.

The relevant items in the existing policy bond corresponding to the items given in the endorsement shall be required to be cancelled.

Needless to add, at the time of fresh printing of policy document these changes shall need to

be incorporated.


IV. PROPOSAL FORM:

Existing Proposal Form shall be used after modifying the UIN (Unique Identification

Number). Further, it has been decided to add another question as given below. The same may be added while printing the new proposal form. For existing stock of proposal forms a rubber stamp may be used to add the question.

Question 4 c) Is your life now being proposed for another assurance or an application for revival of a policy on your life or any other proposal under consideration in any office of the corporation or to any other insurer? If yes, give details.

All other terms and conditions of the plans shall remain unchanged.

These modifications will come into force with effect from 1st January 2010.