All you need to know about sites comparing insurance products

All you need to know about sites comparing insurance products

General Insurance, IRDA Updates, Life Insurance

You might have come across many websites which are comparing the insurance plans premiums and collecting data about the interested person through their online portals. These sites are called Web Aggregators.

“Web Aggregator” – For the purpose of these guidelines, a web aggregator is a Company registered under Companies Act, 1956 (1 of 1956), approved by the Authority under these guidelines, in whose behalf a website offers information pertaining to insurance products and / or price comparisons of products of different Insurers.-IRDA(Web Aggregators) Regulations, 2013

Do you know that all the sites which are working as Web aggregators have to be registered with IRDA and only after the approval of the IRDA any website can work as Web Aggregators? A Web Aggregator cannot be an insurance agent.

You can find the list of IRDA approved web aggregators at the end of this post, as published by IRDA on 24/08/2016 on its websites.

IRDA has laid down the regulations about the Web Aggregators called as IRDA(WebAggregators) Regulations, 2013; these regulations are about the registration process, lead generations, affiliation with insurers, the number of insurers that an aggregator can work with, sharing of information collected through websites with insurers and many others.

As per the regulations a Web Aggregator has to follow these points:

  1. Web aggregator shall display on the website the premium rates and Key Features of the insurance products of all the Insurers for each class of insurance business.
  1. The price comparisons that are displayed shall be up to date and reflect a true picture of the products.
  1. If you have provided your information on a web aggregators site but didn’t show your interest in any particular insurance product/company, then a web aggregator can share your information with maximum up to 5 insurers in same insurance class (life/nonlife/health). He can also share your information in these case to any insurance broker but not to both.
  1. Web aggregator has to transmit the data of clients to Insurer/Broker:
    1. within five days of the client’s visit to the website.
    2. must be secured from unauthorized access and misuse;
    3. with a reasonable level of suitability, reliability, and correctness;
    4. in compliance with generally accepted security procedures;
  1. Web aggregator can only transmit any leads generated through clients visiting their sites
  2. If a lead was given to an insurer/broker convert into a sale then insurer/broker pay the remuneration to web aggregator which is not more that 25% of the first-year premium.

Obligations of web aggregators

  1. Web aggregator should display the particulars of the validity of approval obtained from the IRDA on its website.
  2. Web aggregator must state clearly and unequivocally that insurance is the subject matter of solicitation.
  3. At no point of time of its functioning, a web aggregator shall have net worth below rupees fifty lakhs
  4. At no point of time of its functioning, a web aggregator shall have the referral arrangement with any Insurer.
  5. Web aggregator shall maintain the records and the reports of its activities under the agreement with insurer / broker, in the manner specified in the agreement entered into between the insurer / broker and the web aggregator.
  6. Web aggregator shall along with its employees (whatever their designation may be) comply with all the provisions of the Act, the IRDA Act, 1999, the rules and regulations framed thereunder and such other directions issued by the IRDA from time to time.

You can find the list of approved Web Aggregator below:

 

LIC changed agency MBG criteria for agents

LIC changed agency MBG criteria for agents

LIC Agents, Life Insurance

Ahead of its Diamond Jubilee year Life Insurance Corporation of India has given a good gift to its agents by changing various norm related to MBG criteria and eligibility norms related to recruitment of agent. This step will be beneficial for both agents as well as Development Officer of LIC. Earlier the MBG criteria for the LIC agents was 12 lives and . 100000/- FYPI  in an agency year.

It will not only help the LIC to retain more agents but also help its Development Officers to recruit more agents as the overall eligibility criteria of minimum qualification of agent reduced to 10th compared to 12th in urban areas and 10th in rural areas. Other than the changes made by LIC, all the other conditions will be governed by the LIC Agents Rules (1972)

Here are the key changes which were approved by the LIC board related to agency matter:

Agency Performance Review policy (MBG Criteria):

  1. The Minimum Business Guarantee norms (MBG Criteria) to be achieved by agents during the agency year :
    An agent has to procure –
    EITHER 6 lives AND .50,000/- FYPI
    OR  12 lives
    OR . 1 Lac FYPI.                                                                                                                                                           Notwithstanding the above, an agent shall be exempt from bringing in the business
    required of him, if he has continually worked for the Corporation as an agent for a
    period of:

    • not less than 21 years ; or
    • at least fifteen years and he is at least 55 years of age; or
    • fifteen years and at any time subsequent thereto there is a business in force in the books of the Corporation under his agency yielding a renewal premium income of not less than Rs. 2,00,000 per annum.
  2. The criteria for termination of agency for failure to achieve the Minimum Business Guarantee:
    If an agent fails to bring in the business required of him as specified in 4(a) above in
    an agency year, his appointment shall stand terminated at the end of such agency year
    under the provisions of Agents Rules, 1972.
  3. The criteria for re-appointment / reinstatement of agents terminated for failure to achieve the Minimum Business Guarantee: As per Agents Rules, 1972 and amended from time to time
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Eligibility conditions for Appointment of Insurance Agents:

  1. Eligible Age:

    An applicant must be at least 18 years of age on the date of the application.

  2. Eligible Educational Qualifications:

    Passed minimum Class X (matriculation examination), or equivalent examination from
    a recognized Board or Institution.

  3. Interview Procedure :

    Branch Manager to interview all applicants.

Pre-Recruitment training on Insurance to Applicants:

Pre-recruitment Insurance Training (online or offline) to equip the prospective agents
with the insurance, knowledge to appear for insurance agency examination –

  • for life insurance agent –

    25 hours of classroom training; and 25 hours of practical training in accordance with the syllabus prescribed by the authority in life [in Branch Office – the respective Development Officer to impart training and certificate of successful practical training to be issued either by Development Officer or ABM(S)]or BM (S) ; 25 hours of classroom training at the time of renewal of agency (as appointment will have to be renewed after every 3 years);

  • for a composite agent with respect to the Life aspect –

    25 hours of classroom training; and 25 hours of practical training in accordance with the syllabus prescribed by the authority in life As regards Non-Life part, training needs will depend upon the respective Insurers. The Training will be valid for a period of 6 months.

Skill Development Training:

Agents shall be exposed to various training for the purpose of Skill Development including those conducted by National Skill Development Council (NSDC), Government of India, BFSI SSC Financial Sector Skill Council in a phased manner.

Other than MBG criteria and  above-mentioned points all other conditions related to LIC agents are according to LIC agents rule 1972 and other circular related to agency conditions and benefits issued later on by LIC. To know more about other changes approved by Board of LIC click the link provided next Board Approved Policy on Agency Matters

Direct debit facility for LIC premium payment

Direct debit facility for LIC premium payment

Life Insurance

Have you missed to deposit your last LIC premium on time? Do find remembering the premium due dates a tiresome process? Do you have multiple policies with different due dates? You want to take policy in ECS mode but your bank is not connected to any ECS center? Then Direct debit facility is the solution for you, only requirement is you must have a bank account in ICICI, corporation bank or State bank of India. Till now LIC of India have tie up with these three banks only for Direct Debit.

This facility is different than the ECS system in which clearing house is also involved, while direct debit is a provision between LIC and bank, on due date bank deduct the premium from your account and deposit in the account of LIC of India pool account with same bank. After the LIC received your payments in its account it is then appropriated in your policy. Direct debit facility can be availed in any branch of ICICI, corporation and SBI even if they are not connected to ECS system. Even in through rural branched of these bank direct debit facility can be enabled. Direct debit facility is available for both new and existing policy holders of LIC of India.

Process of enabling direct debit facility is very simple.

  1. Fill the form of  debit facility in 2 copies
  2. Submit one to bank (ICICI, Corporation or SBI)
  3. Get the other copy attested and submit to LIC of India (Bank may charge for attestation as per their rules). Submission of attested mandate form to LIC of India is very important, LIC do not accept unattested mandate form.

Other important things about direct debit facility

  1. Debit facility can be taken at any stage of policy and for any mode of premium payment
  2. Bank account must have sufficient balance on debit date
  3. Under this facility, only positive/honoured transactions will be accounted.
  4. If dishonored due to reason “Insufficient balance” then dishonors charges Rs. 125 per transaction will be charged by LIC of India.
  5. If any due is dishonored, payment for the dishonor due and all the installments due up to the date of payment are to be paid in cash or DD at any LIC Branch cash counter.
  6. Debit facility will benefit the policy holders at locations where there is no ECS clearing house.

To download mandate for Direct debit facility Click Here

Types of revival for lapsed LIC policies

Types of revival for lapsed LIC policies

LIC, Life Insurance

To keep the risk cover in force in your LIC policy a policyholder must pay his/her insurance premium on time or within the grace period. If a policyholder failed to do so then his policy became lapse, and no risk cover is available under that policy.

To restart the risk cover in the policy, a policyholder has to revive the policy by paying all the due premiums up to the date of revival.

Nowadays policies can be revived in other branches if the policy is to be revived on DGH and Medical Report only. If there is any special medical report is called for then policyholder has to visit his servicing branch to revive his/her policy. But sometimes it’s not possible for the customer to deposit all the due premiums to revive his/her policy, to make the revival process easy and convenient, LIC have different types of revival scheme so that customers can revive their policy to restart the risk cover.

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Types of Revival Schemes in LIC

There are five types of  schemes are available in LIC of India. These are Ordinary Scheme, Special Scheme, SB cum Revival scheme, loan cum revival scheme and installment revival scheme.

Ordinary Revival Scheme

Its the simplest scheme of all, all you have to do is to visit your servicing branch, get the revive quotation from the branch and deposit all the due premiums in your policy with DGH (Declaration of Good Health) or special medical report wherever applicable as per age and sum to be revived.

Special Revival Scheme

Sometimes it is not possible to pay all the due premiums due to huge amount to revive policy, and policy holder do not want to loose the money he has already paid as premium in particular policy (Majority of the policies acquire paid up value after premium have been paid for full three years and 3 years completed in policy). For customer who’s policy have not acquired paid up value (Premium is not paid for 3 years) and policy is in lapsed condition for not less than 6 months and not more than 3 years (6 months < FUP > 3 years), the policy can be revived under Special Scheme.

Under this scheme Date of commencement can be increased up to 2 years of original date of commencement and

  • other requirements will be same as of ordinary scheme
  • the difference of new and old premium must be deposited with any due premium
  • Since DOC and maturity date will shift, consent of policyholder is required
  • endorsement fee of Rs. 50 and policy bond for endorsement is required
  • this type of revival can be done once in policy term
  • Policies under withdrawn plans can be revived under this scheme, even if the new date of commencement falls beyond the date of withdrawal of the plan provided the other conditions applicable for the scheme are satisfied.
  • Some policies are not allowed under this scheme.
  • For policies issued before 01/01/2014, a new date of commencement (DOC) should not be later than 31/12/2013. (As per LIC circular CO/CRM/1012/23 dated 17/03/2016)

As per the LIC of India circular CO/CRM/1012/23 dated 17/03/2016, Special Revival scheme is not available to new plans launched on or after 01/01/2014.

Loan-cum-Revival Scheme

Under this scheme, the policyholder can take the loan in his/her policy and that loan amount is adjusted in premiums. It is not necessary that your policy has acquired paid up value, even policy where paid up value is not acquired can be revived. The loan amount is calculated as if the policy is in force condition till the date of revival. Very useful scheme if the policyholder is not able to pay lump sum revival amount from his pocket at that time.

Survival Benefit cum Revival Scheme

The revival of money back policies can be allowed under ordinary revival by taking into account the amount of survival benefit that had fallen due. The policyholder has to submit usual revival requirements, S.B. discharge form and policy document.

This scheme is allowed for

  1. Survival benefit amount is more than revive amount and balance amount after utilizing amount for revivel is payable to policyholder
  2. Survival benefit amount is less than revival amount. However, shortfall amount will be required to be paid by policyholder

Revival By Installment Method

Under this scheme, the amount is spread over the next two year. Revivl under this scheme will be permitted-

  • for the policyholder who is not in a position to pay the arrears of premiums in one lump sum and policy cannot be revived under special scheme.where the arrears of premiums are for more than 1 year.
  • There is no loan outstanding under the policy at the time
  • No survival benefit falls due during the installment paying period of revivl
  • The arrears of premiums will be calculated in the usual manner as under ordinary scheme. Depending upon the mode of payment, life assured has to pay initially 6 Monthly premiums, 2 Quarterly premiums, 1 Half-premium , or ½ of Yearly premium. Balance of the arrears will be spread over in the remaining premium due date in current policy anniversary and two full policy anniversary thereafter

To download DGH (Declaration of Good Health) Form No. 680 Click Here

How to protect yourself from insurance frauds

How to protect yourself from insurance frauds

Life Insurance

 

Lots of Insurance frauds are in the news of various newspapers, Fraudsters using various means to cheat people, they are using phone calls claiming themselves officers of IRDA, preparing duplicate policy bonds, imposing as an insurance agent with false ID cards and much more that we cannot imagine.

Insurance scam: Crime branch arrests man for duping former government employee off Rs 77 lakh

Fake LIC agents dupe techies with bogus IDs-The Times of India

Insurance scam: IRDA warns against fraudulent agents who mis-sell products with refund baits-DNA

One can only protect himself from these insurance frauds by being vigilant.

Anyone can become the victim of these insurance frauds, so how to keep yourself protected from these insurance frauds.

Points to keep in mind to protect yourself from Insurance frauds

  1. Always update your contact details in your policy with your insurer like your mobile no. email ID and correspondence address, so that you can get all the messages sent by insurer related to your policy, like premium due dates, registration of NEFT details, payments under your policy,  changes in your policy or any other alteration in your policy.
  2. Do not fall prey of rebate in insurance premium, people often hand over cash to agents deducting rebate and become an easy prey of fraudsters.
  3. No insurance company declare bonus to one customer and not to other and never ask you to deposit money in any account to get the bonus. Do not fall prey of these calls and claims.
  4. Keep your policy bond in a secure place and share it with your spouse/or trusted person only.
  5. Never hand over you policy bond to anyone in any case, until unless you know the person very well and his where about or to your old and regular insurance agent (keep in mind not only old but regular insurance agent)
  6. Never engage yourself in any phone calls claiming themselves from IRDAI. IRDAI never calls any policyholder for payment of bonus or to tell you about how your insurance agent is cheating you. If you get the call just go to you branch and check the status of your policy and report about the call to officials of an insurance company.
  7. Add you bank account details to all of your policies not matter how long is the maturity date.
  8. If any new insurance agent contacts you for new plans don’t take the policy immediately in one visit. Check his ID card and confirm with the concerned branch, before his second visit. If it’s confirmed that he/she is a genuine insurance adviser then only consider taking policy from him.
  9. Never hand over cash to any new/unknown insurance agent for new proposal/renewal premium to avoid insurance frauds. Pay through account payee cheque only, clearly mentioning Company name and amount in it. Always write the purpose of issuing cheque behind it like, “For new proposal in the name of ******* for policy 820-20-15, sum assured Rs. 500000, annual premium Rs. *******” or “for renewal premium of policy/policies no. ******
  10. Take follow-up after issuing cheque after two-three days if you do not receive any message from an insurance company. (Nowadays all insurer send message for completion of new proposal to customers mobile no.)
  11. If you always give cash or cheque to your agent for deposit of premium then at least check the status of your policy in every 6 months.
  12. Create your online account with the insurer to know the status of your policies anywhere and anytime you want.

One can never know what type of mediums and means these fraudsters are using, you can only be vigilant to avoid such type of insurance frauds.