NPS: Relaxed Norms for PSU Employees

The government may relax norms for facilitating employees of Central public sector undertakings (CPSUs) to join the New Pension Scheme (NPS). Under the existing guidelines, if an employee does not have a minimum 15 years of service, he/ she cannot join the NPS. This rule may be relaxed. Before NPS was launched, government employees could not get pension if they had less than 20 years of service. When the government notified the guidelines for NPS, they did away with this criterion. Meanwhile, the Pension Fund Regulatory and Development Authority, or PFRDA, has allowed pension funds to invest in mutual fund units and bonds of infrastructure debt funds (IDF) having a minimum credit rating of ‘AA’, from at least two credit rating agencies.

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ETF as Investment for Insurance Firms

Following deliberations between the finance ministry and the Insurance Regulatory and Development Authority (IRDA), the regulator will soon notify exchange traded funds as an investment product for insurance firms, according to media reports. The move is expected to help the government tap into the huge resources of insurance companies and to ensure long-term investments through this mode. We are not sure whether the move would be beneficial to the government. Moneylife believes that ETFs are trading products while insurance companies are required to invest for the long term. Many ETFs are not liquid enough to accommodate the large liquidity needs of insurance companies, especially when they want to sell.

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Insurance: Policyholders Dissatisfied with Claims Settlement

Astudy conducted by consumers’ rights organisation, Consumer Voice, has found that four out of every nine health insurance policyholders have faced problems while getting their insurance claims approved and settled. The survey was conducted across eight Indian cities, Delhi, Mumbai, Kolkata, Chennai, Bengaluru, Hyderabad, Ahmedabad and Lucknow, to find out whether or not the health insurance providers keep their promises and settle the policyholders’ claims. In all, 3,312 respondents participated.

The claims include those made with insurance providers and third party administrators (TPA).  Out of this, 26% claimants say documentation is the toughest part, while 21.8% complaints relate to authorisation of claims. Close to 17% respondents rated ‘unjustified deduction by TPA in claim settlement’ as a major problem they have to deal with at the time of claim processing.
 

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COMMENTS

Laxmanprasad Gupta

4 years ago

IRDA should ensure compliance of section 9 (6) of IRDA (Protection of policy holders interests)Regulations 2002 quoted below on insurers who delay unduly claim settlement. Further consumers should also start demanding interest on claim amount for unduly delay for all old claims since IRDA's regulations are effective from 16-10-2002.
"9(6) “Upon acceptance of an offer of settlement as stated in sub-regulation (5) by the insured, the payment of the amount due shall be made within 7 days from the date of acceptance of the offer by the insured. In the cases of delay in the payment, the insurer shall be liable to pay interest at a rate which is 2% above the bank rate prevalent at the beginning of the financial year in which the claim is reviewed by it.”
Dr.L P GUPTA
Author "India Insurance Guide 2013"

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