Monday, July 29, 2013

DHFL buys out DLF’s 74% stake in DLF Pramerica Life

Mumbai-based home loan and housing finance company Dewan Housing Finance Corporation Limited (DHFL) has bought DLF’s 74% stake in the insurance joint venture DLF Pramerica Life Insurance. However, neither of the companies has disclosed the deal amount, but according to the sources close to the development, the amount could be anything around Rs 350-400 crore.
In 2007, the largest reality firm of India, DLF had announced to enter into life insurance sector through a joint venture with US-based Prudential International Insurance Holdings Ltd., a unit of Prudential Financial Inc.
Apart from DLF Pramerica Life Insurance, Prudential International Insurance is present in Indian insurance sector through joint ventures with two dozen Indian life insurance companies, in which Prudential International Insurance holds the maximum permissible foreign holding of 26%.
DLF in a filing to BSE said that it signed definitive agreements on Thursday to sell its 74% stake in the life insurance joint venture DLF Pramerica Life Insurance to DHFL. The stake sale in the joint venture is part of DLF's strategy to divest ‘non-core’ assets to reduce debt. The joint venture had reported a combined loss of over Rs. 250 crore during past two fiscals.

Friday, July 26, 2013

Employees' unions oppose govt. proposal to allow 49% FDI in insurance

Several employees’ unions have been opposing Insurance Laws (Amendment) Bill 2008, which recommends to raise foreign direct investment (FDI) ceiling to 49% from 26%. The Union government has approved the bill as recommended by the Arvind Mayaram Committee, and is making thorough efforts to pass during the forthcoming monsoon session of Parliament.
Addressing a press conference, Mr. Ravi and Ms. Geetha, members of the Life Insurance Corporation (LIC) of India Employees’ Union said that the decision to raise FDI ceiling in insurance sector would only help foreign capitalists gain greater access and control over domestic savings, which is against the national interest.
The south zone Insurance Employees' Federation is also opposing the bill. In its 32nd state level conference, which is to be held from August 3 to August 6, the body is planning to meet over one lac people as part of its 'Meet the Public' programme. According to the sources, the key highlight of the meet would be expression of opposition to FDI.
If the bill is passed, a foreign investor can be able to invest up to 49% in India insurance sector under the automatic route in which companies investing do not require prior government approval.
Sri K. Swaminathan, General Secretary, south zone Insurance Employees Federation said, “If you see the claims settlement experience of private insurance companies, in many cases, the unsettled claims are as high as 40% to 50%.”
“There are no new products for the public as a result of the FDI hike,” he added.

Thursday, July 25, 2013

Consumer forum asked National Insurance to pay 6 lac to a nominee

The South Mumbai District Consumer Disputes Redressal Forum has held that when the terms of an insurance policy are vague, benefits should be given to the insured. The insurer National Insurance Company denied the accidental death claim of a Mumbai resident on the ground that the death of his father, a senior citizen and a doctor, due to a fall at home, was not accidental and was caused by disease-related giddiness.
In its decision, the consumer forum told the insurer to pay the victim's son, Dr Sunil Vakil, the insured sum of Rs 5 lac along with an interest of Rs 1.20 lac. The forum also asked insurer to pay Rs 23,000 as compensation for an unfair trade practice and towards the costs of the complaint.
The forum cited a national commission order which said it was an accidental death even if an insured person suffered a fit and drowned or fell in front of a train and was killed.
The national commission ruling said “It is settled law that when two reasonable interpretations of the terms of the policy are possible, the interpretation which favours the insured is to be accepted and not the interpretation which favours the insurance. Further, the terms of the insurance policy are drafted one-sided by the insurance company. Therefore, in case the terms of the policy are vague, benefits should be given to the insured and not to the insurer."
Death, which does not occur in the usual course or natural course of events or causes which could not be reasonably anticipated, is considered accidental, the commission order added.
The insured Dr. ShirishVakil was covered under the Janata Personal Accident Insurance Policy.

Wednesday, July 24, 2013

AEGON Religare Life to tie-up with Yes Bank for premium collection

Private sector insurer AEGON Religare Life Insurance (ARLI) Company has announced its tie-up with YES Bank for collecting premiums. This would facilitate customers to pay their renewal premiums as well as new business premiums at any YES Bank branch across the country.
To pay ARLI’s premium at any YES Bank branch, the customer needs to fill in the deposit slip in favour of AEGON Religare Life Insurance Company Limited bearing his/her policy number, name and contact number on the reverse of the slip. The customer soon receives a premium payment acknowledgement receipt upon payment across the bank counter.
 The bank which has more than 130 branches across the country will charge no extra cost for the facility. Any new branches added by YES Bank will be made available to AEGON Religare Life customers to make the renewal premium payment.
 "Our idea of tying up with YES Bank is to provide our customers with an additional mode to pay their premium, without the hassle of locating and visiting an ARLI branch”, said Sri Yateesh Srivastava, CEO, AEGON Religare Life Insurance.
 “YES Bank accesses real-time data of a particular policy and simply collects the due premium. We've ensured that the customer details are secured and do not transfer from or to any of the YES Bank branches”, he added.
ARLI is a joint venture between AEGON (26%), Religare Enterprises Limited (44%), and Bennett, Coleman & Company (30%).