Sahara Life Ins penalised Rs 12 lakh

New Delhi: Insurance sector regulator IRDA today imposed a penalty of Rs 12 lakh on Sahara Life Insurance Company promoted by Subrata Roy-led Sahara Group for violation of various regulations, including delay in death claim settlement.

"Accordingly, in exercise of the powers conferred upon me under the provisions of the Insurance Act, 1938, I hereby direct the insurer to remit the penalty of Rs 12 lakh," IRDA Chairman J Hari Narayan said in an order against insurer.

The company, set up in 2004, has been directed to pay the fine within a period of 15 days from the date of receipt of the order, it said.

The Insurance Regulatory and Development Authority (IRDA) observed that the insurer allowed unlicensed entities to solicit business through dummy codes and paid commission to such entities.

"Taking into account, the seriousness of the violation a penalty of Rs 5 lakh is imposed on the insurer under Section 102(b) of the Insurance Act, 1938," IRDA said in the order.

Besides, Sahara Group promoted life insurance company also allowed ineligible person to act as specified person, the order observed.

The insurance regulator also found Sahara Life guilty of licensing ineligible entities as corporate agent.

In its order the regulator said, "it is observed that the corporate agent D K Associates has solicited business through unlicensed persons as evident from the six sample proposal forms obtained during the course of inspection."

The submission of the Sahara Life in this case was taken into account but not considered satisfactory and the violation of corporate agency guidelines of 2005 was proved, it said.

Taking into account the seriousness of the violation, it said a penalty of Rs 5 lakh was imposed on the insurer for the said violation.

The regulator also found the life insurer guilty on count of delay in death claim payments and settling the delayed claims without penal interest.

The insurer's submission that they made special efforts to review pending claims and paid penal interest in all delayed cases was considered. It was also noticed that 41 of the 220 outstanding claims were pending beyond six months, the order said.

"Insurer's submission that claim forms have not been received in 11 of the 41 cases has been also considered.

However, the fact that 30 claims still remain pending beyond six months is established," it said.

"This is a persistent non compliance and hence a serious view is being taken of violation of provision of regulation of Protection of Policyholders' Interests Regulations, 2002. The Authority hereby imposes a penalty of Rs 2 lakh for this violation," it added.

New York Life in talks to exit India JV

New Delhi: New York Life Insurance Co is in talks to sell its stake in a joint-venture with healthcare and life insurance company Analjit Singh-led Max India, it was reported on Wednesday citing an unnamed source.

The U.S.-headquartered insurer has a close to 26 percent stake in Max New York Life, India's largest non-banking private insurance company, estimated to be worth around 35 billion rupees ($709 million), the report said.

Around one-third of the sale proceeds would be paid to Max India, it said citing a person familiar with the development.

Our JV is a highly successful operation that provides important insurance products to the people of India. We do not comment on rumours, a New York Life spokesman was quoted as saying.

A spokesman for Max India could not be immediately reached for comment by Reuters. New York Life was not available outside its business hours.

Max India holds a 70 percent stake in the joint venture, and Indian lender Axis Bank owns the remaining 4 percent. ($1 = 49.3650 rupees)

LIC to invest Rs 1.95 lakh cr this fiscal

Mumbai: Life Insurance Corporation (LIC) will maintain its investment in various assets classes at around Rs 195,000 crore in the fiscal 2011-12

“Last year, our total investment across asset classes was about Rs 1.95 lakh crore and I think we will be able to maintain that in spite of the slowdown,” LIC acting Chairman DK Mehrotra said here. LIC’s investments in the current fiscal in the capital markets will also be at par with the last fiscal’s Rs 43,000 crore, he said.

Mehrotra, who has been officiating as the chairman since May 2011, said LIC has invested Rs 1,25,000 crore across asset classes till November which includes up to Rs 28,000 crore in equities and the remaining in debt.

“We are a long-term player and opportunities keep on coming. If there is good value and where have had an opportunity in the recent past, we have picked up good scrips, there is no doubt about it,” he said.

When asked if it will help the government achieve its Rs 40,000 crore disinvestment target and pick up stakes in public enterprises, as is being mooted, Mehrotra said LIC has not received any such proposal but, “If there is value, definitely we will see (to that)”.

LIC, the biggest domestic buyer of Indian equities, is reportedly in the final stages of adopting direct market access and has already formed an initial panel of brokers to route its trades.

Meanwhile, LIC’s housing finance subsidiary LICHFL launched a Rs 500 crore venture capital fund to finance realty and micro-infrastructure projects. LIC Housing and LIC have pooled in Rs 50 crore each and another Rs 100 crore have been raised via external investors to launch the fund.

The LICHFL Urban Development Fund aims to raise the remaining Rs 300 crore in the next nine months, Mehrotra said.

Half of the amount will be invested in mid-income housing projects while the other half will be dedicated to income yielding micro-infrastructure projects like schools, the company said.

IRDA fines MetLife Insurance Rs 2 lakh

New Delhi: Insurance regulator IRDA has imposed a fine of Rs 2 lakhs on private sector insurer MetLife for failure to follow norms while issuing policy.

"IRDA is satisfied that there has been negligence on the part of the insurer (MetLife India Insurance Company) and consequently imposes a penalty of Rs 2 lakh," said an order issued by the regulator.

Insurance Regulatory and Development Authority (IRDA) has passed the order in connection with the delay in communicating the status of life insurance policy to one Suresh Chukkapalli.

Under the IRDA regulations, an insurer is required to process a proposal with speed and efficiency and communicate the decision to the applicant within 15 days of the receipt of proposal.

The IRDA said "insurer (MetLife) did not pay sufficient attention in promptly communicating the underwriting decision as well as in refunding the proposal deposits collected from the complainant within the prescribed timelines."

Star Health announces Rs 600 cr loss in premium

Chennai: City-based health insurance provider Star Health and Allied Insurance has reported a Rs 600 crore loss in premium this fiscal as the AIADMK government has scrapped the Kalaignar Insurance Scheme managed by the company, a top official of the firm said today.

Star Health and Allied Insurance had emerged as the successful bidder for the Kalaignar Insurance Scheme, a pet project of then Chief Minister and DMK President M Karunanidhi. The scheme was aimed at benefiting below poverty line families.

However, as soon as Chief Minister Jayalalithaa assumed office in May, 2011, the Kalaignar Insurance Scheme was scrapped and an improved insurance cover with additional benfits announced. The new scheme was bagged by another city-based insurance provider.

A sum of Rs 600 crore in total premium was impacted this year, Star Health and Allied Insurance CMD V Jagannathan told reporters after unveiling the upgraded version of the company's 'Family Health Optima' insurance plan.

Jagannathan said in Andhra Pradesh, the company bagged the state government-sponsored 'Aarogyasri Community Health Insurance Scheme' for providing quality health care to BPL families. However, it had lost this insurance scheme as there were not many takers and the company lost Rs 200 crore on the total premium.

A company official, on condition of anonymity, said the impact was big as many did not prefer to renew the insurance scheme. "Selecting a scheme is their choice. Similarly, rejecting a scheme is also based on their interest," she said.

On the company's target for this year, Jagannathan said it would remain "flat", with around Rs 1,200 crore in total premium collections this fiscal.

On future plans, he said the company plans to launch a "high-end" health insurance product targeted at elite individuals. "After getting approval from IRDA, we may introduce it this year itself...," he said.

In Madurai, company Vice-President A M Mallesh told reporters the firm also plans to focus on northeastern states.

Tamil Nadu accounted for one-third of the premium collections in the country, he added.

Sachin Tendulkar buys Rs 100 cr cover

Mumbai: Having moved into his "dream house", ace cricketer Sachin Tendulkar has now secured his five-story Bandra residence with a staggering Rs 100 crore insurance cover, one of the biggest insurance deals by an individual.

The cricket icon has bought the insurance from a consortium of general insurers, according to industry sources.

"A consortium of general insurance companies has given an insurance cover for the cricketer's home in Bandra for a value consideration of Rs 100 crore," an official of a public sector general insurance company, who wished not to be named, said.

As per the official, all the four state-run GIs along with a private insurer have provided the cover.

"Oriental Insurance Company, United India Insurance, New India Assurance and National Insurance Company are the four government-owned general insurers providing the cover along with a private insurer," the official said, adding the annual premium would be around Rs 40 lakh.

According to another insurance official, the cover has been taken in two parts. While a fire insurance policy has been obtained for Rs 75 crore, an additional cover of Rs 25 crore has been bought for household items like furniture, electronic gadgets and cricket accessories among others.

The fire insurance covers losses from blaze, terror attacks, natural disasters like earthquakes, and burglary among others. The insurance covers the cost of the land, compound walls, besides electrical equipment.

The Tendulkars had moved into the sprawling 6,000 square feet villa in Bandra West in September from a flat that had been allotted to the maestro under sports quota.

"Everyone has a dream of owning a house. I, too, had this dream. I am happy that I was able to fulfil it," Tendulkar had said while moving into his new abode.

The cricketer's residence stands on a plot that earlier housed a dilapidated bungalow, which he had bought for Rs 39 crore in 2007.

The villa has been secured with high-walled fencing to avoid curious onlookers. CCTV cameras and sensors have also been installed.

Besides the three storeys above the ground level, the villa reportedly has two underground basements.

With this deal, Tendulkar has joined a select league of industrialists and filmstars who have taken such high insurance cover in the recent past.

While filmstar Shah Rukh Khan has reportedly insured his mansion "Mannat", also in Bandra, for Rs 110 crore, Reliance Industry chairman Mukesh Ambani's USD 1-billion Antilla has been insured for around Rs 150 crore.

LIC earned Rs 6,542 cr profit from stock mkt

New Delhi: Country's largest insurer, Life Insurance Corporation, earned Rs 6,542.72 crore profit from investments in stock market in the first seven months of the current fiscal, Parliament was informed today.

LIC had invested Rs 21,294.80 crore in the equity market during April-October period of 2011, Minister of State for Finance Namo Narain Meena said in a written reply to the Lok Sabha.

In 2010-11, LIC invested Rs 43,213.60 crore in the stock market against Rs 61,398.13 crore in 2009-10.

The profit booked from the investments in equity market stood at Rs 17,055.36 crore in the last fiscal as compared to Rs 9,432.25 crore in 2009-10, Meena said.

RBI: The Reserve Bank of India has reported that certain irregularities in the restructuring of loans have been observed in different categories of restructured loans such as agriculture loans, small borrowers and other category of borrowers in some public sector banks.

"In few cases, restructuring was done without conducting any viability study with regard to various financial and business aspects," Meena said.

Repeated restructuring was undertaken in certain cases, he said, adding that irregular upgradation of restructured accounts were also done in some cases.

He also said that RBI, during the second quarter Review of Monetary Policy of 2011-12, on October 25, 2011, had proposed constituting a working group to review the existing prudential guidelines on restructuring of advances by banks or financial institutions.

It proposed the group suggest revisions taking into account the best international practices and accounting standards.

Credit Cards: Credit card related complaints are generally received from the customers on the grounds of non-adherence of banks or its subsidiaries to the instruction of Reserve Bank on credit card operations, Meena said.

During July-November 2011, as many as 5,554 complaints were received by the office of the Banking Ombudsman relating to credit card operations of scheduled commercial banks, he said.

During 2010-11, 11,800 complaints were received by the Banking Ombudsman relating to credit card operations of scheduled commercial banks.