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Basics of Insurance
Basics of Insurance
Contents:
Life insurance General insurance Insurance market scenario Emerging trends in insurance
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Learning Insurance
What Is Insurance
Insurance is concerned with protection of economic value of assets.Tangible assets are human beings, house, furniture, motor cycle etc.Intangible assets are liabilities
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History of Insurance
It started from Lloyds coffee house London First policy issued in England in 1583 In India first policy issued in 1870
History of Insurance
LIC of India formed in 1956 after nationalization of life insurance Business of 245 private insurance companies General insurance business of 107 insurance companies was nationalized in 1972 & four public sector General Insurance Companies were formed
Classes of Insurance
A. Life insurance B. General insurance General insurance is further classified:1.Fire insurance 2.Marine insurance 3.Miscellaneous insurance
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Miscellaneous Insurances:1.Motor insurance 2.Mediclaim insurance 3.Householders insurance 4.Shopkeepers insurance 5.Engineering insurances etc.
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Market Intermediaries
Who procure the insurance business: Agents Corporate agents Insurance brokers Banks (Bancassurance)
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Provides death cover only during policy period Premium is low No refund of premium Sum assured paid on death
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Death cover only Period is not specified Premium is low & paid during life time No refund of premium Sum assured paid on death
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Covers death & survival benefits Sum assured paid on death or on maturity of policy Period of policy at the option of proposer Most common plan
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Available for different periods Covers death & survival benefits Lump sum paid periodically Full sum assured paid on death
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Policies available with bonus or without bonus Death due to accidents can be covered for additional S.A. Policies available exclusively for women & children Additional cover for major diseases available Guaranteed bonus policies available
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Fire
Standard fire policy-
Policies
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Marine Policy
Marine Cargo Policy
Policy insures physical loss or damage to the goods in transit by road, rail, air, water caused due to accidents, fire etc.
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Health Insurance
Medi claim policy Overseas medi claim policy Videsh yatra mitra policy Corporate frequent travelers policy Employment & study policy Group medi claim policy Cancer policy
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Liability Insurances
Compulsory public liability policy Public liability policy Products liability policy Professional indemnity policy Lift (third party) policy Directors liability policy Employers liability policy
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Cattle policy
Poultry policy Agricultural pump set policy Crop insurance
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Engineering Insurances
Machinery Breakdown Insurance Loss of Profits (Machinery Breakdown) Insurance Electronic Equipment Insurance Erection All Risk Insurance (EAR) Storage cum Erection Insurance (SCE)
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Engineering Insurances
Contractors All Risk Insurance (CAR) Contractors Plant and Machinery Insurance (CPM) Boiler and Pressure Plant Insurance Loss of Profits (Boiler Explosion) Insurance Deterioration of Stocks Insurance.
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Insurance Law
The Insurance Act 1938 (amended) Insurance Regulatory & Development Authority Act 1999
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IRDA
Insurance Regulatory & Development Authority is the controlling and regulatory apex body in the country for insurance sector and its chairman and members are appointed by Government of India. IRDAs HQ is located at Hyderabad
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IRDA General Insurance - Reinsurance Regulations, 2000 IRDA The IRDA (Staff) 2000 IRDA Surveyors and Loss Assessors 2000 IRDA Reinsurance Life 2000 IRDA Revised Investment Regulations in April 2001
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Insurance Regulations
Irda (third party administrators) regulations 2001 Irda (protection of policyholders interest ) regulations, 2002
Insurance Regulations
Irda (manner of receipt of premium) regulation 2002 Irda (licencing of brokers) regulation 2002 Irda (micro-insurance) regulations, 2005 IRDA (Treatment of Discontinued Linked Insurance Policies) Regulations, 2010 IRDA (Sharing of Database for Distribution of Insurance Products) Regulations, 2010
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IRDA vide letter no. IRDA/F&A/CIR/025/2009-10 dated 05-08-2009 has issued detailed guidelines to all insurers on corporate governance for the insurance sector for compliance with effect from 01-04-2010 and an Amendment No.1 has been issued vide letter no.IRDA/F&I/CIR/F&A/014/01/2010 dated 29-012010
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Further in 2010-11 Health insurance increased to Rs. 1558 crores with 44.76 % growth, Agriculture insurance increased to Rs. 1960 crores with 29 % growth, Credit insurance increased to Rs. 885.67 crores with 8.84 % growth.
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Emerging Trends
Detariffing in General Insurance from 1.1.2007 leading to greater price war & new products in future Banks entering insurance market through joint ventures with foreign finance majors
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Emerging Trends
Increasing Role of Insurance Brokers Bancassurance Corporate Agency IT intervention & uses
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Emerging Trends
Greater Job Opportunities For thousands of Insurance Managers, IT Professionals For lacs of Insurance Advisors For Insurance Professionals For Risk Managers For Underwriters For claim Settlements
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Emerging Trends
Increasing No. of Insurance companies & Intermediaries Increasing Awareness about Insurance Growth in GDP Increasing No. of Middle Class
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Emerging Trends
Vast No. of uninsured population Underinsurance Untapped potential for General Insurance
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Emerging Trends
Increasing awareness about Health Insurance Increasing awareness about Personal Line Insurance like House, Shop, Personal Accident Market flooded with new insurance products
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