Ombudsman

The Insurance Ombudsman scheme was created by Government of India for individual policyholders to have their complaints settled out of the courts system in a cost-effective, efficient and impartial way.
There are 12 Insurance Ombudsman in different locations and you can approach the one having jurisdiction over the location of the insurance company office that you have a complaint against.

You can approach the Ombudsman with complaint if:

• You have first approached your insurance company with the complaint and
• They have not resolved it
• Not resolved it to your satisfaction or
• Not responded to it at all for 30 days
• Your complaint pertains to any policy you have taken in your capacity as an individual and
• The value of the claim including expenses claimed is not above Rs 20 lakh

Your complaint to the Ombudsman can be about:

• Any partial or total repudiation of claims by an insurer
• Any dispute about premium paid or payable in terms of the policy
• Any dispute on the legal construction of the policies as far as it relates to claims
• Delay in settlement of claims
• Non-issue of any insurance document to you after you pay your premium

The settlement process

Recommendation:

The Ombudsman will act as counsellor and mediator and

• Arrive at a fair recommendation based on the facts of the dispute
• If you accept this as a full and final settlement, the Ombudsman will
• Inform the company which should comply with the terms in 15 days

Award:

• If a settlement by recommendation does not work, the Ombudsman will:
• Pass an award within 3 months of receiving the complaint and which will be
• A speaking award with the detailed reasoning
• Binding on the insurance company but
• Not binding on the policyholder
• The Ombudsman can also award an ex-gratia payment

Once the Award is passed

• You have to accept the award in writing and the insurance company has to be informed of it within 30 days and
• The Insurance company has to comply with the award in 15 days after that.

Types of Insurance Companies

Getting insured is one great way to secure your future. While shopping for insurance you will came across many insurance companies. Getting a right knowledge about the types of insurance companies is very important.

Different kinds of insurance companies can be classified as:

Life insurance companies

These insurance companies sell life insurance, annuities and pension products. It mainly deals with long and short-term monetary investments, college plans, and plans that mature and benefit your surviving family at the time of your death.

Non-life insurance companies

These are one of the different kinds of insurance companies are which sell other types of insurance. These companies are mainly concerned with protecting property from many risks and natural acts like fire, lightning, typhoon, flood and earthquakes.

Composite insurance companies

These insurance companies types sells both life and non-life insurance.

Insurance companies are also classified as either mutual or stock companies. Mutual companies are owned by policy holders whereas stock companies are owned by stock holders.

Reinsurance companies

Another of different types of insurance companies is the Reinsurance companies, which sell policies to other companies. This helps them to reduce their risks and protects them from huge losses. The reinsurance market is dominated by a few large companies, with huge reserves.

Captive insurance companies

These are other kinds of insurance companies that can be defined as limited purpose companies. It is established with the main objective of financing risks originating from their parent groups or groups. It can be said as an in house self insurance vehicle. Captives also represents commercial, economic and tax advantages to their sponsors. They help in risks management.

Types Of Insurance

As life is full of uncertain events; it is good idea to get insured. There are different types of insurance provided by various insurance companies. You only need to decide the perfect insurance that fits your financial plans. Given below are different kinds of insurance. Choose the one that you require and need most.

Life insurance

Life insurance is one of the most well known and common insurance. This insurance is taken against the risk of death. It provides cash benefits to the decedent's family or other designated beneficiary and may specially provide for burial and other final expenses.

Auto insurance

Another kind of insurance that is often required is auto insurance. It is typically taken against the risks of road accident. It helps cover against theft, financial loss caused by accidents and any subsequent liabilities.

Health insurance

Health insurance is taken against the risks of sickness and accidents. It covers all the medical expenses incurred because of sickness or accidents.

Factors to take into consideration while deciding a corpus for retirement

Retirement planning has become an important part of our financial goals like any other goal. However, many individuals face difficulty in assessing the right retirement corpus that they will need in their sunset years. There are lot many factors to consider like debts will be paid off, some routine expenses would end but medical, healthcare costs would increase. Also, the life span of an individual also affects retirement planning. Hence, here are the three simple steps to figure out your nest egg.

1) Current Expenditure - First and foremost step is to calculate an individual's current expenses per month or per annum. For example, after adding up all costs, an individual's monthly expenditure is Rs. 50,000, which means an annual expense amount of Rs. 6,00,000.

2) Inflation Adjusted Corpus - Once the current expenditure is derived, it is important to adjust the amount for inflation for the number of years till retirement. For instance, a person aged 30 years has current annual expenditure of Rs. 6,00,000 and plans to retire at the age of 60. This means current expenses have to be ascertained for the period after 30 years. Thus, a person will need approximately Rs. 60,00,000 per annum at his retirement age based on 8% inflation per annum.

3) Adjusting For Life Expectancy - In the above calculation, per annum amount has been calculated. But, one would need a corpus that should take care of the entire life term, which is why life expectancy comes into play. In the above example, if an individual's life expectancy is 80 Years then it means he will need Rs. 60,00,000 per annum for 20 years post retirement. Thus, a calculation shows a corpus requirement of Rs. 12 crores to take care of post retirement expenses.

The above retirement corpus can then be discounted back at the current interest rate in equity funds, so as to calculate the SIP amount required towards this goal.

Irda wants to enable insurers to fix agency commission

Insurance sector regulator Irda (Insurance Regulatory and Development Authority) suggested to the parliamentary panel looking into the Insurance Bill on Monday, to incorporate a provision to give a free hand to insurers to fix the agency commission, which is currently capped at 40 per cent of the first-year premium.
At a meeting held with MPs chairing the select house panel on the Insurance Law (Amendment) Bill on Monday, Irda Chairman T S Vijayan endorsed the regulator's internal panel's recommendation to abdicate its powers to fix agency commission, because it felt that insurers should be free to give agents better commissions to help deepen insurance penetration, said an Irda member who attended the meeting. The meeting was chaired by BJP member Chandan Mitra, who is the chairman of the select house panel, in Mumbai on Monday. The house panel is likely to submit its report before the winter session which begins on November 24 and the finance ministry is hopeful tabling the Bill during the session.
The government had tried to table the Bill in the monsoon and budget sessions in June and July, but could not do to due to opposition from the Congress. Currently, the law does not allow insurers to pay more than 40 per cent of the first-year premium to agents as commission. Sources said that the Irda is of the view that a flexible commission framework would make agents more productive and help deepen insurance penetration, which is only 3.2 per cent at present. Agents have been quitting insurance companies due to a lack of major incentive to them and their number shrank to 21.5 lakh as on September 30 from 21.9 lakh as on 31 March this year, as per industry sources.