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New Changes in Insurance Domain

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Policy holders can hope to benefit from a number of changes expected in 2012


   Unlike your investment plans, you don't have to look for predictions or make alterations to your insurance covers in the New Year. Most of the fundamentals remain the same: you must have a life cover (preferably term cover) if you have financial dependents; you also must have a health cover for yourself and your family. Sure, there are many other covers you can add to your protection plan: accident cover, critical illness cover and so on.


However, you may have to watch out for regulatory changes that could impact your decisions. Like 2011, even the New Year is likely to be eventful for insurance customers.


The year promises to ring in many developments and record the impact of several regulatory changes in 2011. Here is a small list of what you can expect in 2012:

LIFE INSURANCE

Wider Access In The Offing

It's the key regulatory change the industry is talking about, with the draft guidelines released just a few weeks ago. Banks are likely to be allowed to tie up with multiple insurers. This will give the customer more choice.


The proposed regulations will allow banks to join hands with more than one insurer, but it is subject to the area-wise segmentation laid out in the draft guidelines.


While the final regulations could take a very different shape, the fact remains that the flexibility to banks will certainly improve, resulting in more choices for the customers.

Pension Ulips Set For A Comeback

The revised guidelines on pension Ulips have come into effect from December 31. While products are yet to be filed under the new regime, life insurers seem to be fine with the new rules. Agents were pushing pension Ulips aggressively before September 2010. In 2011 though, very few companies launched these products under the new regime. Now, however, insurance-seekers keen on buying pension Ulips can look forward to the revival of such products this year.

Online On A Roll

The trend of selling term polices online took root in 2010 and branched out to many more companies in 2011. The unique selling point of these products is that they are much cheaper than their offline counterparts. We expect that internet sales as a channel will gain further momentum and will help increase the protection penetration as well as branching into health and savings products being introduced through that channel. Also, with Irda bringing out guidelines to regulate web aggregators customers can hope for better services.

Policies To Go Demat

In 2011, Irda gave a go-ahead to converting physical policies into the electronic form. By April 2012, this initiative could take concrete shape for life insurance policies. The key benefit, of course, will be convenience — both in terms of maintaining the documents and making changes when required. Also, the policyholders will not have to furnish details every time they buy a policy.

DTC Impact

For years, many a life policy has been sold on the basis of its tax saving ability — premium paid of up to . 1 lakh is allowed as deduction under Section 80C of the Income Tax Act. Come April 2012, however, things could change with the proposed implementation of the Direct Tax Code (DTC). Here, life and health insurance premium, along with children's tuition fees, are clubbed together, and the combined tax benefits amount to a maximum of . 50,000. This apart, you will not be eligible for the deduction if the annual life premium exceeds 5% of the sum assured in any year. While this spells bad news for insurance cum-investment policies, those opting for pure protection term covers need not worry. Besides being the cheapest life policies, most, subject to your age and health, are also likely to adhere to premium-to-SA ratio.

HEALTH INSURANCE


Portability To Take Off

The much-awaited health insurance portability became effective from October 1, last year, but by all accounts, it has been a slow starter so far. However, insurers expect it to pick up speed between January and March, when salaried individuals are on a tax-saver-instrument buying spree. The framework could also spawn newer varieties of products and services. With increasing awareness on health insurance portability, more proposals on portability can be expected in the year 2012, value-added services will be launched in terms of second medical opinion, vaccinations, and discounts on health care facilities like on diagnostics and preventive health care facilities, like gyms.

Distribution To Spread Wings

After the Ulip charge ceilings that were placed in September 2010, many agents saw their business dwindle and eventually dropped out. The year 2012 could see the fructification of the agent-mentoring model that the Irda has mooted. The initiatives around creation of a senior, mentoring agents framework, new bancassurance norms and regulatory push towards shifting focus from metros to semi-urban and rural areas will widen access to products.

Expansion In Coverage

The list of health insurers offering OPD products that extend coverage to maternity expenses and dental treatment could grow longer this year, with Irda itself backing it. The Irda chief has asked insurance companies to target a larger healthcare cover, over and above hospitalisation policies, by creating such OPD products. With the entry of more international players, we expect cost-effective OPD — comprehensive health insurance policies in 2012. At present, most basic health policies kick in only if the insured is hospitalised for at least 24 hours or is undergoing treatment through day-care procedures.

MOTOR INSURANCE



Innovative Products On Their Way

Ever since detarrification of prices came into the picture in 2008, insurers have been promising add-ons to what was, until then, a standard product. While some headway has been made, customers are yet to see substantial innovation in motor policies. In 2012, though, you could finally get access to more options. Add on products like Road Side Assistance would be introduced for a wider coverage and better customer service experience. Such assistance services would help consumers through a traumatic experience in case of an accident or breakdown.

Rewards For Model Behaviour On Cards

Again, a long-pending promise that is yet to come good, the practice of linking to premiums to factors other than the standard ones pertaining to the vehicle is quite prevalent abroad. The year 2012 could be the year it's introduced in India, too, given that many insurers have been collecting the data required to enable this mechanism. There will be use of more factors for pricing, particularly details of the insured such as age, marital status, driving record etc will be introduced in pricing of motor insurance. This would lead to better risk-based pricing. Thus, consumers with better driving habits and vehicle maintenance can expect relatively better premium pricing than others.

 

 

Aegon Religare New plan for higher studies - Aegon Religare Educare Plan

 

AEGON Religare Life Insur ance is rolling out Aegon Religare Educare Plan.

The cost of higher education is increasing almost everyday. To ensure that the parents of tomorrow are well-equipped to meet the needs and aspirations of their children, it is important to plan to save in a disciplined manner from today.

Also, higher education costs are not a one-time thing, but a recurring payment, which is why we have designed the new plan with lump sum pay outs over four years.

The Aegon Religare Educare Plan comes with a number of additional benefits, including providing guaranteed payouts during Pinaki Paul the last four years of the pol icy, and offers two benefits to choose from -the first option offers a sum assured and accrued bonus on death and guaranteed payouts during the last four policy years and the second option offers the sum assured and accrued bonus on the death of the policyholder, guaranteed payouts during the last four years of the policy and 10 per cent of the sum assured every year, till the end of the premium payment term.

On maturity of the policy, it provides 20 per cent of the sum assured, which is the last instalment of the guaranteed payout, along with the accrued bonus. It also offers a high discount on sum assured of Rs 5,00,000 and above and an optional additional cover through an ADDD rider (accident, death, disability and dismemberment).

The truly unique part of this plan is the annual lump sum pay out geared to meet the annual expenses of higher education.

 

 

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