Now your job will drive auto insurance cover premium

If you are a chartered accountant or a doctor and you are buying a new vehicle , chances are that you would be paying a smaller premium on your vehicle policy compared to a marketing professional or a businessman. This is because physicians and chartered accountants are categorized as a low-risk group by insurers as they travel less frequently on roads than sales executives or other self-employed professionals.

"Occupation is increasingly being considered in risk analysis and premium rating along with other important factors like age, average mileage , parking conditions and previous accident history," said managing director of Royal Sundaram Alliance Insurance Company Ajay Bimbhet. Pricing in motor insurance has gone in for a sea change in the last five years. Prior to de-tariffing (where prices are market-driven ) in 2007, the main factors governing motor insurance premium pricing was the year of manufacture of the vehicle, engine capacity, price and the zone in which the vehicle was bought.

While these four factors continue to play a role in determining the insurance premium , other factors such as occupation are also playing an important role in determining the pricing of the motor cover. "We are seeing the emergence of differential premium pricing with respect to profession. Insurers are giving positive rating for some professions. This is translating to a discount of 5% on tariff premiums," said Rahul Aggarwal of insurance advisory Optima Insurance Brokers. Gender also has a role to play.

So, if you are a woman CA or doctor and your work involves just going to the clinic/ office and coming back, you will end up paying a smaller premium than a male businessman who resides in the same city and drives the same make as you do. That’s because women are considered safer drivers and less rash on roads than their male counterparts.

"There is a differential pricing in motor insurance, and usage of the vehicle on roads and occupation are becoming important factors in determining it," a senior official from United India Insurance said. Motor premiums contribute to nearly 40% of general insurance premium collected by insurers. "The contribution of motor is significant to a company’s top line as well as bottom line. This has resulted in a lot of pricing sophistication in this line of business," head of the actuarial department at Bajaj Allianz General Insurance , Anurag Rastogi, said.

For the first half of FY13, motor insurance contributed 57% to Bajaj Allianz’s business. "A lot of segmentation is happening in the motor insurance space. Companies want to have a profitable set of customers . They are doing so by loading customers who are bound to give more losses and discounts to people who are giving profits," Aggarwal said. 

source: ET

Insurance Regulatory and Developmental Authority to provide for a two-year term car insurance cover

The Insurance Regulatory and Developmental Authority (Irda) is looking to provide for a two-year term insurance cover for both commercial and private vehicles that could be increased to five years later, a government official told ET. A senior official with the insurance regulator confirmed that discussions with both government and insurers were on to extend the period of insurance from one year now. "There was a suggestion from the government that insurance cover can be linked to the registration and fitness certificate," he said. The ministry had argued that at present the insurance renewals are not happening in comparison to the claims being reported.
Car owners may soon be able to insure their vehicles for two years at one time, a move that will help increase premium income for insurers and will benefit customers from lower cost and reduced renewal hassles. Motor insurance is a loss-making business for most insurers because of heavy claims that exceed the premium collected by them. 

"Their concern is that the premium income is low while the liability ratio has increased so to increase persistency, the period of cover should be increased," he said. Irda chairman J Hari Narayan told ET that the discussions are on but at very initial stage. "There are many issues like how the ’no claim bonus’ should be factored in, and other aspects which first need to be scrutinised," he said. If the regulator approves of a long term product, it may be available to both private and commercial vehicles.

A finance ministry official said that a long-term insurance cover will also improve the insurance cover for motor vehicles in the country because many owners do not renew their cover, especially for older vehicles. The ministry has also asked state-run general insurers to set up a working group for analysing their motor portfolio.

"Mostly people in rural areas, specially those using tractors or small utility vehicles do not renew their insurance cover. The idea is if the policy cover is for a longer period and linked with fitness certificate and other details, this will help providing proper insurance coverage at one time," he said. Private insurance firms are not too keen on the idea of a long term insurance cover. 

source: ET

‘Dirty’ diesel drives up insurance premium rates

As the Indian passenger vehicle market moves decisively towards diesel, the shift is leaving its mark on motor insurance premia as well. The premia differential between petrol and diesel vehicles has shot up to 20-22% in certain categories with insurers claiming higher usage, pricier spare parts and steeper maintenance costs as the reason for the higher insurance premium. Diesel vehicles have always commanded higher motor insurance premium and the differential between petrol and diesel variants has traditionally been around 10-15%. But with diesel vehicles ruling the auto mart, that differential has been on the rise.

"With the arrival of new diesel models in the last couple of years, especially in the hatch back and mid size segments, this (difference) has now moved up to 20% to 22% in the case of certain vehicles," said Vijay Kumar, head, motor insurance, Bajaj Allianz General Insurance. Agreed KN Murali, senior vice president and head, motor vertical, Bharti AXA General Insurance, "In case of some models and in certain geographies, the premium differential can move up to 20%." Since diesel cars have higher usage and the cost of spare parts is higher than their petrol counterparts, this is reflected in the premium pricing.

"Diesel cars have higher claims ratio than petrol vehicles," added Murali. Part of the reason why diesel commands a higher insurance premium has to do with the premium pricing of diesel vehicles. Typically the price differential between the petrol and diesel version of a hatchback model can range from Rs 50,000-70,000. And with car companies raising prices, the premia also goes up. But, said Rakesh Batra, India automotive sector national leader, Ernst & Young, "diesel technology, even in its latest avatar, does command higher maintenance cost. That’s as true globally as it is in India.

The engine configuration requires more frequent maintenance because it suffers greater wear and tear." Insurers say the other aspect of diesel vehicles is that a significant number of them are in the people mover (cabs and tourist taxis) category so they clock higher mileage on a daily basis (50-100 km) when compared to petrol vehicles which run for about 15-30 km every day. "The probability of accidents is higher in the case of diesel cars as against petrol vehicles as the former run longer on the roads. As the risk is higher in this category, that gets reflected in the premia as well," said Murali. The diesel-petrol differential is not the only fuel-led differential in motor insurance.

With alternative fuels like CNG becoming popular, a premium differential is also emerging in CNG fitted cars as compared to petrol or diesel cars. "Many customers are retrofitting a CNG kit as the car turns slightly older," said Vijay Kumar. These kits are normally priced between Rs 40,000 and Rs 45,000 and when the motor premium comes up for renewal, insurers charge an additional 4% on the value of the CNG kit (Rs 1,600-Rs 1,800) for such vehicles after deducting the no claim bonus. "As a category change and a modification has occurred in the vehicle, this results in an additional surcharge," said Tarun Kumar Singh, chief executive officer, of financial consultancy, Finexure Consultancy Services. "But what happens when the OEM supplies factory fitted kits on new vehicles? Not all CNG fitments are after market options." 

source: ET

General insurance companies go to IRDA with new proposals; move to bring down fraud third party claims

If general insurance companies have their way with the regulator, your accident insurance claim will be rejected if a friend rams your car. It may well be curtains for people taking joyrides in friends’ cars. Your motor insurance premiums will also go up depending on how many in your family use the vehicle, a move which could face resistance. Rejection of claims in accidents where the vehicle is driven by a person not part of the list provided at the time of buying a policy is among the latest proposals the industry is taking to the Insurance Regulatory Development Authority for approval to boost profitability.

"This is the only way to bring down frauds in third party claims," said Vijay Kumar, head of motor insurance at Bajaj Allianz. "Only 35% of the commercial vehicles on road are insured but we see large part of the claims from them." The claim will be rejected even if by law the person carries a driving licence, said two people familiar with the plan. The general insurance industry, which has been incurring losses due to their poor underwriting standards and fake third party motor insurance claims, are working up novel ways to boost their profitability.

Although the industry is seeking these proposals, it is not clear whether the regulator will approve them. Claim ratio on third party motor insurance, which is the proportion to the premium earned, has gone up to 213% last fiscal, implying for every Rs 100 earned in premium, companies paid a claim of Rs 213. "We are actively looking at rate differentiation through number of users in a limited manner," said Sanjay Datta, chief-underwriting and claims, ICICI Lombard.

"We don’t have external data sources to verify driver behaviour like in the west." But enforcing these rules even if they are admitted by the regulator could be difficult in a country where some car owners force their servants to step in for the accidents caused by them. But insurers who have been loss-making for nearly a decade are determined to change the system. In fact, they are looking to use the data from the credit bureaus to determine the premium, though there is no data on insurance customer behaviour.

"If people have good track record in Cibil, they do not have fraudulent tendency and their behaviour towards driving is strong," said Kumar. If a policy seeker has top credit profile, insurers may give as much as 40% discount on premium. Similarly, if a car is chauffeur driven, insurance companies may offer 10% discount. "The chances of theft are lesser if a car is driven by chauffeur," said ICICI’s Datta. Motor insurance contributes one third of the premium income for the non-life industry. As of September, the industry had earned Rs 13,626 crore by selling motor policies. 

source: ET

Franklin Templeton Mutual Fund announces dividend under various schemes

Record date for dividend is 28 December 2012 

Franklin Templeton Mutual Fund has announced 28 December 2012 as the record date for declaration of dividend under the following schemes. The amount of dividend will be: 

Templeton India Income Opportunities Fund-Dividend Plan: 

Individuals & HUF-Rs 0.176 per unit
Others: Rs 0.151 per unit 

Templeton India Income Fund-Dividend Plan: 

Individuals & HUF-Rs 0.176 per unit
Others: Rs 0.151 per unit 

Templeton India Corporate Bond Opportunities Fund: 

Individuals & HUF-Rs 0.163 per unit
Others: Rs 0.139 per unit 

Templeton India Income Builder Account-Plans A & B-Quarterly Dividend option: 

Individuals & HUF-Rs 0.176 per unit
Others: Rs 0.151 per unit 

Dividend Plans of Templeton India Government Securities Fund: 

Composite Plan & Long Term Plan (each): 

Individuals & HUF-Rs 0.132 per unit
Others: Rs 0.113 per unit 

Treasury Plan: 

Individuals & HUF-Rs 0.052 per unit
Others: Rs 0.045 per unit 

Templeton India Short Term Income Plan-Retail Plan-Quarterly Dividend Option: 

Individuals & HUF-Rs 17.618 per unit
Others: Rs 15.101 per unit 

Templeton Floating Rate Income Fund-Retail Plan-Dividend Option: 

Individuals & HUF-Rs 0.220 per unit
Others: Rs 0.188 per unit 

Templeton India Low Duration Fund-Quarterly Dividend Plan: 

Individuals & HUF-Rs 0.197 per unit
Others: Rs 0.169 per unit 

FT India Monthly Income Plan-Plans A & B-Quarterly Dividend Plan: 

Individuals & HUF-Rs 0.132 per unit
Others: Rs 0.113 per unit 

Dividend Plans of FT India Life Stage Fund of Funds: 

50s Plus Plan & 50s Plus Floating Rate Plan: 

Individuals & HUF-Rs 0.154 per unit
Others: Rs 0.132 per unit

DSP BlackRock Mutual Fund announces dividend under various schemes

Record date for dividend is 28 December 2012  

DSP BlackRock Mutual Fund has announced 28 December 2012 as the record date for declaration of dividend under the dividend option of the following schemes. The quantum of dividend will be:  

DSP BlackRock Government Securities Fund: 

Individuals: Rs 0.192743 per unit
Others: Rs 0.165201 per unit 

DSP BlackRock Treasury Bill Fund: 

Individuals: Rs 0.147641 per unit
Others: Rs 0.126543 per unit 

DSP BlackRock MIP Fund: 

Individuals: Rs 0.180000 per unit
Others: Rs 0.154279 per unit 

DSP BlackRock Short Term Fund: 

Individuals: Rs 0.173011 per unit
Others: Rs 0.148288 per unit 

DSP BlackRock Bond Fund: 

Individuals: Rs 0.164466 per unit
Others: Rs 0.140964 per unit 

DSP BlackRock Strategic Bond Fund (‘DSPBRSBF') –Regular Plan: 

Individuals: Rs 16.276871 per unit 
Others: Rs 13.950923 per unit 

DSPBRSBF – Institutional Plan: 

Individuals: Rs 16.484678 per unit
Others: Rs 14.129035 per unit 

DSP BlackRock Income Opportunities Fund (‘DSPBRIOF') – Institutional Plan – Dividend Option: 

Individuals: Rs 15.290073 per unit
Others: Rs 13.105138 per unit 

DSPBRIOF – Institutional Plan – Quarterly Dividend Option: 

Individuals: Rs 14.933656 per unit 
Others: Rs 12.799653 per unit 

DSPBRIOF – Regular Plan – Dividend Option: 

Individuals: Rs 0.144734 per unit
Others: Rs 0.124051 per unit 

DSPBRIOF – Regular Plan – Quarterly Dividend Option: 

Individuals: Rs 0.134780 per unit
Others: Rs 0.115520 per unit 

DSP BlackRock Natural Resources and New Energy Fund – Regular Plan: 
Rs 0.50 per unit

ICICI Prudential Mutual Fund announces dividend under two schemes

Record date for dividend is 31 December 2012 

ICICI Prudential Mutual Fund has announced 31 December 2012 as the record date for declaration of dividend under the following schemes. The amount of dividend on the face value of Rs 10 per unit will be: 

ICICI Prudential Fixed Maturity Plan Series 60 – 1 Year Plan J: 

Dividend Option: Rs 0.05 per unit 

ICICI Prudential Interval Fund IV-Quarterly Interval Plan B: 

Retail Dividend Option: Rs 0.1836 per unit 

Dividend Option: Rs 0.1907 per unit 

Suspension of trading of units of ICICI Prudential Fixed Maturity Plan Series 60 – 1 Year Plan J
 
In view of the fixed maturity plan maturing on 31 December 2012, the fund shall suspend the trading of units on the BSE with effect from the close of trading hours on 26 December 2012. The record date for determining the eligible unitholders / beneficial owners who would be entitled for the redemption proceeds shall be 31 December 2012.

Tata Mutual Fund announces dividend under various schemes

Record date for dividend is 31 December 2012 

Tata Mutual Fund has announced 31 December 2012 as the record date for declaration of dividend under the dividend options of the following schemes. The rate of dividend on the per unit face value of Rs 10 each will be: 

Tata Fixed Income Portfolio Fund – Scheme B3 Plan A (Quarterly Dividend): Entire returns generated between 27 September 2012 to 31 December 2012. 

Tata Fixed Income Portfolio Fund – Scheme B3 Regular Plan (Quarterly Dividend): Entire returns generated between 27 September 2012 to 31 December 2012. 

Tata Fixed Maturity Plan Series 38 Scheme D (Periodic Dividend): The quantum of dividend will be entire distributable surplus.

IDFC Mutual Fund announces dividend under various schemes

Record date for dividend is 31 December 2012 

IDFC Mutual Fund has announced 31 December 2012 as the record date for declaration of quarterly dividend under various schemes. The quantum of dividend per unit on the face value of Rs 10 per unit will be entire distributable surplus as on record date i.e. 31 December 2012. 

The schemes are: IDFC Fixed Maturity Plan-Eighteen Months Series 9 to 11, IDFC Fixed Maturity Plan-2 Years Series-1 & 2, IDFC Fixed Maturity Plan-3 Years Series-5, IDFC Fixed Maturity Plan-Thirteen Months Series 9 & 11, IDFC Fixed Term Plan- Series 1, 2 & 4, IDFC Fixed Maturity Plan – Yearly Series 47, 48, 50, 51, 60, 62, 63, 65, 66 & 67, IDFC Fixed Maturity Plan – 366 Days Series 71, 73, 74, 75 & 76.

HDFC Mutual Fund Launches HDFC FMP 371D December 2012 (1)

NFO Period from 31 December 2012 to 8 January 2013 

HDFC Mutual Fund has launched a new plan named as HDFC FMP 371D December 2012 (1), a plan under HDFC Fixed Maturity Plans – Series 23 (a close-ended income scheme). The face value of the new issue will be Rs 10 per unit. The new issue will be open for subscription from 31 December 2012 will close on 8 January 2013. 

The investment objective of the plan is to generate regular income through investments in debt / money market instruments and government securities maturing on or before the maturity date of the plan. 

The plan shall offer two options - growth and dividend option. 

The plan would invest 60% to 100% of assets in debt & money market instruments with low to medium risk profile. The plan may invest upto 40% of net assets in government securities with low risk profile. 

The minimum application amount is Rs 5000 and in multiples of Rs 10 thereafter. 

The fund seeks to collect a minimum subscription (minimum target) amount of Rs 20 crore under the plan during the NFO period. 

Entry and exit load charge will be nil for the plan. 

Benchmark Index for the plan is CRISIL Short Term Bond Fund Index. 

The fund manager of the scheme will be Anil Bamboli.

Birla Sun Life Dynamic Bond Fund Announces Dividend

Record date for dividend is 31 December 2012 

Birla Sun Life Mutual Fund has announced 31 December 2012 as the record date for declaration of dividend under the quarterly dividend option of Birla Sun Life Dynamic Bond Fund – Retail Plan. The quantum of dividend on the face value of Rs 10 per unit will be Rs 0.2275 per unit.

Birla Sun Life Monthly Income Fund Announces Dividend

Record date for dividend is 31 December 2012 

Birla Sun Life Mutual Fund has announced 31 December 2012 as the record date for declaration of dividend under the quarterly dividend option of Birla Sun Life Monthly Income Fund. The quantum of dividend on the face value of Rs 10 per unit will be Rs 0.2160 per unit.

Irda sets up panel for sub-broking

The Insurance Regulatory and Development Authority (IRDA) has set up a committee to consider sub-broking in insurance. A total of 11 members with representatives from the life insurance council, the general insurance council and Irda have been made part of the committee.

P C James, chair professor from National Insurance Academy, and two members from Insurance Brokers Association of India are also part of this committee. In order to increase insurance penetration in semi urban and rural areas, Irda observed that the presence of intermediaries is essential.

“The issue of sub-broking is under consideration of the authority for quite some time. After considerable deliberations on the issue of sub-broking, it has been decided to constitute a committee to examine various issues relating to sub-broking and submit their report to the authority for consideration,” said Irda in a notification.

The committee would consider introducing a retail broking system in the insurance space in India. It would also look into the manner in which the retail broking system could operate as sub-brokers and together with insurance brokers.

Also, the committee would consider and recommend the draft agreement that should be entered into between the brokers and retail sub-brokers if such is the recommendation.
The committee would submit its report by January 31, 2013.

source: Business Standard

Tax-free bonds find few takers

Lower returns seen drying up investor demand this financial year 

The tax-free bonds issued by state-owned companies have found few takers so far this financial year, compared to last year. Lower rates and modest broker commissions have been some of the reasons for the tepid investor participation in these quasi sovereign bond issues, say investment bankers and wealth managers.
 
Power Finance Corp's Rs 5,600-crore bond issue (including the green-shoe units), scheduled to end on Friday, extended the closing date to Thursday as the offering received only 60 per cent bids until the weekend.

The bond issued by Rural Electrification Corp (REC), which closed earlier this month, raised about Rs 3,000 crore, against the target of Rs 5,500 crore, including the green-shoe option. While the issue size was Rs 1,000 crore, which was fully lapped up, bankers said lack of demand for the green-shoe option units reflected the relatively subdued demand among investors. Last year, all the green-shoe option units, had been lapped up within days of offers’ opening.

Bankers now fear the next issue, by India Infrastructure Finance Company (IIFCL), which plans to raise Rs 10,000 crore from December 26 to January 11, might meet with the same fate as the previous two.

Wealth managers and bankers said well-heeled investors and firms, among the biggest investors in such issues, were not participating as they were not finding the yields on the tax-free bonds attractive enough.

“A yield of 7.2 per cent is not exciting for HNIs (high networth investors) or companies, despite being tax-free, because the returns are much lower than the 8.1-8.3 per cent they received last year,” said Raghvendra Nath, managing director, Ladderup Wealth Management, a firm that services rich investors.

Last year, the HNI category for these tax-free bonds was fully subscribed on the very first day, with retail investors bidding over the next few days. State-owned companies had issued such bonds worth Rs 30,000 crore in 2011-12, encouraging the government to allow firms to raise Rs 55,000 crore in 2012-13.

“The lukewarm response is partly because all the three issues have come one after the other, without any gap. How can investors bring in so much money at such a short notice?” asked a banker to one of the issues on the condition of anonymity.

Bankers said three share sales — by Bharti Infratel, NMDC and CARE Ratings — which mopped Rs 11,000 crore in December, also contributed to the liquidity crunch.

Compounding their woes, even brokers are not pushing these bonds due to lower commissions. At 0.1 per cent fee, few brokers were willing to sell these bonds aggressively, bankers said. Sale of firms’ fixed deposits fetch brokers fees of at least 2-3 per cent, while in the case of mutual funds, the average commission is one per cent.

source: Business Standard

IRDA, Finmin at odds over nod for online sales of insurance policies

The insurance regulator has expressed reservations over the finance ministry's view that firms need not take another approval for insurance products sold online, arguing that such plans need to be assessed differently from those sold through intermediaries. 

The ministry is seeking to push online insurance products because it believes that cheaper plans available online can help expand the coverage across the country from the abysmally low 4.4% for life insurance and 0.7% for nonlife insurance.

However, this has led to a difference of opinion between the ministry and the Insurance Development and Regulatory Authority.

"The structure is different because in an e-product there is no commission payable. It is a global practice that the two products require different approvals," said a senior official with  IRDA.

  

The official said that in case of online policies, a record should be maintained as per a pre-set format to ensure that the product sold is what the customer asked for.

"In order to protect the investor interest, it is required that separate approval for online policies is given," the official said. The ministry has refused to buy this argument, though, and asked the IRDA to fix a ceiling for all products and charges per deal.

"Our view is there is no need for a re-approval as it causes unnecessary delays. As far as pricing is concerned, the insurance companies and web aggregators can work that out within the IRDA ceiling," said a senior finance ministry official, requesting anonymity.

Industry players admit that a separate clearance for online policies is a tedious task and often acts as a deterrent.

"If a product can be sold directly or through phone and has the same features, then there is no need for a second approval for an online product," said the chief marketing officer of a private sector insurance firm.

But online web aggregators feel that the conditions laid by the IRDA are too stringent. "At present, we get Rs 30 per lead or 25% of the commission earned on premium. They also need to revisit these norms if the online insurance penetration has to be increased," said an industry player, who did not wish to be named.

Akshay Mehrotra, chief marketing officer of Policybazaar.com, one of the bigger online insurance aggregators, said the online potential was yet to be fully tapped.

"There are only three pure online ULIP (unit-linked insurance plan) products available as of now. Insurance firms also need to develop focused online products for expanding reach," said Mehrotra.

Since the beginning of this month, the firm has sold about 15,000 policies online. As per industry reports, the sale of online insurance has almost doubled over the past year and online insurance industry is expected to touch Rs 1,500 crore by the end of this fiscal.
Most industry players, such as Aegon Religare Life Insurance, Aviva India, HDFC Life, and ICICI Prudential Life Insurance, also have online insurance products. 

source: ET

AMFI launches common account statements (eCAS) in electronic form

The Association of Mutual Funds in India (AMFI) on Friday announced the roll out of mutual fund common account statements, or CAS, in the electronic form.

Last year, capital market regulator Securities Exchange Board of India (SEBI) had directed all fund houses to provide a common account statement to every investor. Since November 2011, physical copies of CAS are being dispatched to investors. It is issued each month to MF unit holders in whose folios financial transactions have taken place during that month. Now, the electronic version of this statement will be sent to the investor's e-mail ID.

That is, the e-mail ID registered as per the investor's KYC (know-your-customer) records or the one registered in the last transacted folio during the month. The newly-launched eCAS system will offer convenience, security and anytime/anywhere access, an official release from AMFI said.

"One of the main challenges to roll out CAS was to aggregate data across five registrars and present a common account statement to an investor based on the PAN. Suitable independent partners had to be identified to address confidentiality related challenges," explained HN Sinor, chief executive, AMFI. Terming it a 'Go Green' initiative, he said that eCAS will offer convenience to investors.

The mutual fund body's deputy chief executive V Ramesh advised investors to update their KYC records with their latest e-mail IDs to ensure that the e-statements are sent to the correct ID. 

source: ET

Tax sops may boost sagging insurance sector in 2013

The long-pending Bill seeking to raise FDI limit to 49 per cent in insurance business remained stuck in 2012, although going ahead the sector may see some action with the government expected to extend tax sops to boost the sagging industry.

Prodded by finance minister P Chidambaram, the tax authorities and insurance regulator Irda are working on the possibility of removing Service Tax on first premium and create separate exemption limit for pension schemes.

A slew of incentives being considered by the finance ministry may provide the much-needed booster dose to the life insurance industry.

The Department of Revenue is examining whether, in addition to NPS, some insurance pension products - as approved by Irda - may be included in the separate limit over and above the limit of Rs 1 lakh under section 80C of the IT Act for the purpose of income tax deduction on the premium paid.

Besides, the Department is looking into the proposal of exempting annuity policy from service tax in line with National Pension Scheme (NPS) and may reduce the levy on single premium products.

The CBDT is considering whether the total sum paid for post-retirement medical scheme could be made eligible of income tax deductions.

The announcements by the Finance Minister are expected to stimulate the growth of the sector.

"I am sure all the draft guidelines will be finalised in the first quarter of the year. I am also confident that 2013 will see the collaborative efforts to grow the life insurance sector gaining further strength. This will result in a clearly laid out roadmap for the sector," Max Life Insurance Managing Director Rajesh Sud said.

Echoing similar views, Reliance Life Insurance, President and Executive Director Malay Ghosh said: "We hope to see several enabling regulations, as mentioned by the Finance Minister, in the next few months to drive stable growth for the industry in the coming years."

The key initiatives expected by the industry include bancassurance, open architecture, use and file product approval process and simplifying agency licensing process.

During 2012, the Cabinet approved the much-delayed Insurance Bill, for approval and passage in Parliament so that foreign investors can pump in more funds into the capital intensive sector.

The government had introduced the Insurance Bill in the Rajya Sabha in December 2008 to improve and revise laws relating to the sector in the wake of private participation.

The insurance amendment Bill is an omnibus legislation to change parts of three Acts: 

Insurance Act, 1938; Insurance Regulatory and Development (Irda) Act, 1999, and General Insurance Business Nationalisation Act. 

source: PTI

 

Should you opt for the direct plan in mutual funds?

It's a fact vouched for by most buyers buying directly from the manufacturer by evicting the middleman gets you a better deal. Now, mutual fund investors will also be able to apply it in their lives. Starting January 2013, asset management companies (AMCs) will start rolling out direct plans for various schemes. Since no distributors or brokers will be involved in the transactions, these plans will do away with related costs.

Does this mean that investors will gain significantly by taking this route? Should you shift to the corresponding direct plan of a scheme that you are already invested in?

What's the advantage? 

Given that investors can currently buy units directly from an AMC, what's different about the new development? Today, if an investor deals directly with the fund company, the distributor's commission is pocketed by the fund house. Since it is not reflected in a lower expense structure, side-stepping the distributor does not translate into any gain for the investor.

Now, however, SEBI has directed the fund houses to offer separate direct plans, with distinct NAVs, to such investors. Since there will be no distribution and commission expenses, these will come with a lower expense ratio. Consequently, they will have a higher NAV and also yield slightly higher returns than the regular plans.

Industry insiders estimate that the yield could be 0.5-1.25% higher per year for direct plans, though this will vary among AMCs and various schemes. Since commissions are lower for debt schemes, the difference in expense ratio will be lower in case of debt funds. So, if a regular equity fund deducts about 2.5% as expense ratio annually, its corresponding direct plan could charge around 2%, or even less.

In the long run, this can accumulate to a significant amount (see graph). Dhirendra Kumar, CEO of Value Research, says, "Investors may not notice the variation initially, but the difference in return will start to show after a few years." Since investing in mutual funds has become costlier after the recent revision in cost structure, this will come as a relief for many investors.

 
What's the catch?

Don't rush to invest through a direct plan if your knowledge about mutual funds is not extensive. The do-it-yourself route will require you to go the extra mile to save the extra buck.

Currently, most people are accustomed to having their advisers or distributors handle investments on their behalf. In the absence of these, you will have to handle the homework, paperwork, even the legwork yourself.

The problem is that not many investors are comfortable with or savvy about identifying the right scheme to invest in. Most rely on professional advice. If you take the direct route, you will first have to devote time in picking the right scheme that is suitable for your risk appetite and return expectations. This is not an easy task even if you rely on past track record or fund ratings.

Pankaj Maalde, head, financial planning, Apnapaisa, says, "If you don't understand where and why you are investing, you may end up with a bad product." Of course, if you are already invested in a scheme and merely wish to switch to the direct plan of the same scheme, you will not face this problem.

Another issue that you are likely to face is that you will have to handle the documentation yourself. If you are investing in a fund house for the first time, you will have to download the application form from the AMC's website, fill it up and submit it, along with the accompanying documents, to the fund house.

Your subsequent purchases and redemptions can be done online. If you have been a laggard regarding your KYC formalities, you'll have to visit the nearest branch office of the AMC since updating KYC information requires in-person verification, unless you hire a distributor to do this for you.

Besides this, the onus of monitoring the fund performance will also be on you since there won't be an adviser to send you a consolidated statement of your investments. This means sifting through all the mutual fund statements and keeping tabs on every transaction, change in fund attributes, revision in expense structure, etc. For the uninitiated investors, the direct plan route could be cumbersome.

Says Kumar: "The first-time mutual fund investors will find the going tough. It will be worthwhile to get professional assistance for your first steps in mutual funds." Maalde adds, "Even if you are able to pick good quality schemes on your own, you will miss out on timely rebalancing of the portfolio that advisers are well-equipped to handle."

If you're thinking of switching from your existing equity scheme to a direct plan, you will need to consider the tax implications. If you had invested less than a year ago, you will have to pay an exit load of 1% of the total value as well as incur capital gains tax if the latest NAV is higher than the average NAV. In the case of an ongoing SIP, the units bought in the past year will come under this net.

If you want higher returns from your mutual fund investments, direct plans will be more profitable. Over a long period of time, the difference in NAV will grow to a hefty amount. "Savvy investors with large portfolios will benefit considerably over time," says Kumar.

However, be mindful of the accompanying issues involved in investing without professional advice and support. If you can't devote time and energy to research the right scheme to invest in and complete the various formalities, it is advisable to stick to your distributor, who will take commission expense from your investment, but will also offer you peace of mind.

Ideally, wait for some time to see how the direct plan route fares and the benefit that the existing funds are offering before taking the plunge.

source: ET

SEBI moves to boost corporate bond market

Markets regulator SEBI may allow primary dealers (PDs) and banks to play the role of market makers in public issues of corporate bonds by allowing them to give two-way quotes in a screen-based trading system, two people familiar with the development said.

Financial sector regulators - the Securities and Exchange Board of India, the Reserve Bank of India and the Insurance Regulatory and Development Authority -- have met a few times this month to discuss the proposal, they said preferring anonymity. "Sebi wants to allow market making in corporate bonds as it will bring more liquidity in the secondary market, which, in turn, will help in better price discovery," said a regulatory official.

"Market makers will have to give quotes for buying and selling through an electronic trading platform," he added. The government and the Reserve Bank of India are pursuing measures to deepen the bond market as the banking system and the insurance industry are falling short of fulfilling the task of funding infrastructure projects.

Although, the topic has been discussed for nearly two decades, the central bank has been wary of pushing ahead. Last week, deputy governor Subir Gokarn also called for moves to make the bond market more vibrant. "It is a positive development, however, as it happened in government securities, market making by primary dealers has not been very meaningful in terms of adding liquidity to the market," said Ashish Vaidya, executive director, trading, UBS.

"In case the RBI decides to extend backstop facility to banks and PDs, where will the credit risk fall in case of a default scenario? As of now, RBI does not have a stance of taking credit risk," he said. Primary dealers are mandated to play the role of market makers in the government bonds market. But the market for government bonds is far more liquid than the corporate bonds and there is no credit risk since the government can print money and repay even if it goes broke.

Experts are concerned that market making in corporate bonds may be more complicated since there is an element of credit risk involved in bonds issued by companies. "It will be useful for the issuers as it assures some kind of liquidity post listing," said B Prasanna, MD and CEO, I-Sec Primary Dealership. "We need a trading screen before market making is allowed."

Even the regulator has been raising the question of risk. "The question is, who will provide credit enhancement?" said HR Khan, deputy governor, RBI, earlier this month. "Banks cannot because they are already exposed to risk on lending. We can't think of partial credit enhancement, but there are operational issues." 

source: ET

Retail investors turn away from MFs

Folios in the mutual fund industry have been declining steadily over the last few years. However, calendar year 2012 was particularly noticeable as investors, particularly from the retail segment, left in hoards with declining equity markets. Even when markets picked up towards the end of the year, retail investors were conspicuous by their absence. 

Folio is a unique number identifying one’s account with the mutual fund. 

“We have lost many folios especially in the months of September, October and towards the end of November when the markets picked up. Investors were redeeming their units either with an aim to regain their capital or to book profits,” said V. Krishnan, President, Integrated Enterprises. 

3.6% drop in 7 months 

 

According to data from the Association of Mutual Funds in India (AMFI), between March and September, retail folios fell by about 3.6 per cent to 4.35 crore. For the year-ended September 2012, retail folios fell 5.25 per cent. 

Retail folio count at the end of September 2011 and March 2012 stood at 4.59 crore and 4.52 crore. AMFI discloses folio data on a half-yearly basis in March and September every year. Retail folios account for about 97 per cent of the total folios in the industry. The total number of folios in the country is 4.48 crore as at end September. 

Prefers SIP 

 

Industry officials and analysts alike said that this year saw “record number of redemptions.” Most investors now choose to invest through systematic investment plans, said analysts. But even SIPs which are supposed to be long-term investment vehicles did not see an increase in subscriptions or renewal, in case of expired subscriptions, they said. 

Systematic Investment Plans refers to periodic investments made in mutual fund schemes by investors who are looking at creating wealth over a long period of time. The average ticket-size of an SIP is around Rs 1,000. 

Between September 2011 and 2012, debt AUM increased by 15 per cent, while the folio count in these schemes grew by 17 per cent 55 lakh. Analysts said that they had also seen many retail investors moving from equity products to the debt schemes of mutual funds, especially the short-term funds. Portfolio advisors said that they had been advising clients to increase allocation in debt funds and reduce equity exposure.

Moves to debt-oriented 

 

“Retail investors increased their presence in debt-oriented mutual funds (including gilt and liquid funds) with the number of retail folios rising by 10.5 per cent in the past six months (April-September). This can be attributed to investors looking at relatively safer investment options post the volatility in the domestic equity markets in 2011,” said a report by CRISIL on the folio count in the industry. 

The gold exchange traded fund (ETFs) category continued to grow as gold prices soared. Folio count in the gold ETFs category rose by about 10 per cent to 4.9 lakh from 4.7 lakh between March and September. Between September 2011 and September 2012, gold ETF folio count increased by 14.7 per cent. 

The total number of folios in the exchange-traded funds (other than gold) category increased about one-fourth to 1.5 lakh from 1.2 lakh in the one-year period ending September 2012. 

source: The Hindu

IRDA mulls new rule to chequemate fraudsters

The insurance regulator IRDA is considering a suggestion that renewal cheques should be made in favour of specific policy numbers. This follows a disturbing rise in the number of case of cheating and forgery in the insurance sector. Unscrupulous representatives collect renewal payments but use the cheques to sell fresh policies to unsuspecting customers.

This is possible because most premium renewal cheques do not specify the policy number. The guidelines are a bit fuzzy in this regard. Insurers accept cheques made out to a specific policy number but don't refuse those that are simply in favour of the company. Some life insurance companies advise policyholders to specify the policy number on the cheque while others don't. "The suggestion is under critical examination. (Such a rule) would certainly help in combating rise of cases relating to cheating and forgery," says Irda Chairman J. Hari Narayan.

One reason why brokers are resorting to such desperate measures is the degrowth in the insurance sector. After several years of rapid growth on the back of frenetic Ulip sales, the first year insurance premium collections declined 9.2% in 2011-12. In the first half of 2012-13, new insurance sales are down 3.5% over the same period of the previous year.

While buyers are saddled with unwanted policies, insurance companies are facing a tide of disgruntled customers. For an insurance company, any new business that comes at the expense of an existing policy makes no sense. "Such malpractices will in the long run affect the health and overall profitability of the insurance business," warns Metilda Stanley, senior vice-president, Operations, HDFC Life.

On their part, insurance companies are also trying to prevent such frauds. "We shall soon implement a system, very similar to credit cards, whereby the policy number will have to be mentioned on the renewal premium cheque," says Yateesh Srivastava, chief marketing officer, Aegon Religare Life Insurance. They are also trying to educate customers on how they can avoid frauds. "Always make the cheque stating your policy number. If you are buying a new policy, mention your name, telephone number, email id and the name of the policy opted for on the back of the cheque," says Suresh Agarwal, executive vice-president and head, Individual Distribution and Strategic Initiatives, Kotak Life Insurance.

Such incidents bring into focus the welcome calls that companies make to customers after the sale. These calls can be an important curb against mis-selling and frauds. "If a customer has not paid premium for an existing policy but has bought a new one, the welcome caller will bring this to his notice," says Pawan Mahajan, head of customer care, Bajaj Allianz Life Insurance. The customer has 15 days to return the policy and get full refund of his money. HDFC Life has on its own extended the 15-day deadline to 30 days for its customers.

Investments by LIC in state-owned units see an erosion of Rs 5,170 cr in market value

Investments by Life Insurance Corporation of India to bail out some of the government’s bigticket share sale in state-owned enterprises have lost Rs5,170 crore, or almost a quarter, in value. The country’s largest financial institution had to pick up close to 70% of the government’s combined equity offerings in NTPCBSE -0.47 %, NMDCBSE 0.18 % and ONGCBSE 0.91 % because foreign institutional investors as well as local private sector fund houses were put off by the high floor price

Since LIC is a long-term investor that largely dips into funds of traditional insurance policies to subscribe to stocks sold in government’s divestment programme, it is spared of mark-to-market (or MTM) accounting losses arising out of decline in investment value. "Mark-to-market changes are merely notional, reflecting the appreciation or depreciation of value, and not actual profit or loss," said an LIC official. Justifying the investments, he said, "Public sector undertakings are pioneer and market leaders in their respective sectors and many of them have strong fundamentals, huge potential for market share and high intrinsic valuations."

LIC, however, has to take MTM hit from dip in stock prices whenever it buys shares from funds collected by selling unit linked insurance policies. It is understood that due to the demand and pricing of PSU stocks, LIC uses the traditional fund to subscribe to selloff offers. The government had raisedRs30,560 crore between February 2010 and March 2012 from these three divestments. The market value of these investments has slipped even though the BSE Sensex gained 21% since February 2010 and 10% since March 2012. About a month ago, LIC also bought a substantial part of theRs807-crore divestment of Hindustan CopperBSE -0.03 % at Rs156 a share.

The stock is now trading at less than Rs153. "As long as LIC meets the prudential norms, the regulator has no issue. It cannot comment on individual investment decision of any company," said IRDA chairman J Hari Narayan. Investments by LIC in state-owned units see an erosion of Rs 5,170 cr in market value Refusing to comment on specific investments, the official said: "LIC tends to manage its portfolio as a whole and generate good returns. For the period ended September 30, 2012, its equity portfolio has shown fantastic appreciation on mark-tomarket basis."

But, it’s an unrealised valuation of investment and depends upon indices and parameters such as GDP growth predictions, published data on IIP and inflation, exchange rate, crude price, infrastructure spending, FII inflow and national and global scenario, he said, adding that the corporation has booked profits of more than Rs2,900 crore in the last three financial years from PSU stocks. "LIC is the only white knight-....You can technically call such share sale disinvestment, but it is not. Out of LIC’s multiple objectives, one of them seems to be helping the government reduce deficit," said Dhirendra Kumar, founder and chief executive of the fund tracker, Value Research.

"In India, the market capitalization of top 1,800 companies is around Rs65 lakh crore and PSU companies account for more than 25% of the total market capitalisation. Therefore one cannot construct portfolio without PSU stocks. In the past, PSU stocks like Oil IndiaBSE -0.08 %, HPCLBSE 0.02 %, BPCLBSE 2.08 % and ONGC have given fantastic returns on investment over a period," said the LIC official. 

source: ET

Tata Ethical Fund announces dividend

Record date for dividend is 7 December 2012 

Tata Mutual Fund has announced 7 December 2012 as the record date for declaration of dividend under the dividend option of Tata Ethical Fund. The amount of dividend per unit will be Rs 1 on the face value of Rs 10 per unit.

ICICI Prudential MF announces change in exit load structure under two schemes

With effect from 3 December 2012 

ICICI Prudential Mutual Fund has announced change in exit load structure under two schemes with effect from 3 December 2012. Accordingly, the changes are: 

ICICI Prudential MIP 5: 

If the amount, sought to be redeemed or switched out, is invested for a period of up to 6 months from the date of allotment-1% of applicable NAV. 

If the amount, sought to be redeemed or switched out, is invested for a period of more than 6 months from the date of allotment-Nil 

ICICI Prudential Ultra Short Term Plan: 

If the amount, sought to be redeemed or switched out, is invested for a period of up to 1 month from the date of allotment-0.25% of the applicable NAV. 

If the amount, sought to be redeemed or switched out, is invested for a period of more than 1 month from the date of allotment-Nil.

PineBridge Mutual Fund announces changes

PineBridge Mutual Fund has announced the following changes with effect from 1 December 2012 (effective date): 

1. Changes in the key personnel of the AMC: 

Mr Vikram Duggal, Head-Human Resources has been re-designated as Head-Human Resources and Product Development with effect from the effective date. Mr Nilesh Chonkar, Deputy Head-Operations has been re-designated as Head-Operations with effect from the effective date. Additionally he continues to remain the Investor Relations Officer. Ms Sonal Barot, Head-Compliance & Company Secretary ceases to be key personnel with effect from the end of day of 30 November 2012. Mr Rohit Gupte, Head-Operations has been re-designated as Head-Compliance, Risk Management & Company Secretary with effect from effective date. Mr Prateek Jain, CFO & Head-Risk Management ceases to be key personnel with effect from the end of day of 30 November 2012. Mr Vikas Kalmane has been appointed as Head-Finance with effect from the effective date. Mr Kalmane will be key personnel of the AMC and his details are: 

Vikas Kalmane, Head-Finance is 48 years old and holds B.Com degree. He has 25 years of experience. Assignments held during last 10 years and type & nature of experience:
PineBridge Investments AMC (December 2006-till date): 

Position held: Senior Manager-Finance (December 2006-November 2009) 

AIG India Liasion Office (October 2006-December 2006): Position held: Senior Manager-Finance and Administration. 

Edelweiss Securities (September 2005-October 2006): Position held: Senior Manager-Accounts & Finance 

SUN F&C AMC (October 1994-September 2005): Position held: Senior Manager-Accounts & Finance 

2. Revision in the minimum amount in case of inter/intra scheme switches in PineBridge India Equity Fund, with immediate effect: The minimum amount in case of inter/intra scheme (inter option) switches shall be minimum amount required in the respective transferee scheme. 

3. Revision in the offering on the exchange platform for the weekly dividend reinvestment option in PineBridge India Liquid Fund, PineBridge India Treasury Fund and PineBridge India Short Term Fund: The weekly dividend reinvestment option is not available for transactions on the NSE MFSS Platform and BSE StAR MF platform with immediate effect.

Reliance Interval Fund - Quarterly Interval Fund Series III announces dividend

Record date for dividend is 7 December 2012 

Reliance Mutual Fund has announced 7 December 2012 as the record date for declaration of dividend under the dividend option and institutional plan-dividend option of Reliance Interval Fund - Quarterly Interval Fund Series III. The quantum of dividend will be Rs 0.0001 per unit under each option on the face value of Rs 10 per unit.

DSP BlackRock MF Launches DSP BlackRock FMP – Series 81 – 12M

NFO period from 6 December 2012 to 6 December 2012 

DSP BlackRock Mutual Fund has launched a new fixed maturity plan named as DSP BlackRock FMP – Series 81– 12M, a close-ended income scheme with the duration of 12 months. The New Fund Offer (NFO) price for the scheme is Rs 10 per unit. The new issue will be open for subscription from 6 December 2012 and will close on 6 December 2012. The scheme will mature on 12 December 2012. 

The primary investment objective of the scheme is to seek to generate returns and capital appreciation by investing in a portfolio of debt and money market securities. The scheme will invest only in such securities which mature on or before the date of maturity of the scheme.
The scheme offers a choice of two options, growth option and dividend payout option. 

The scheme would allocate upto 100% of assets in debt securities and money market securities with low to medium risk profile. 

The minimum application amount is Rs 5000 and in multiples of Rs 1 thereafter. 

Entry and exit load charge will be nil for the scheme. Units of the scheme are proposed to be listed on Bombay Stock Exchange. 
 
Benchmark Index for the scheme is Crisil Short Term Bond Fund Index. 

The scheme will be managed by Dhawal Dalal.

DSP BlackRock MF Launches DSP BlackRock FMP – Series 82 – 12M

NFO period from 7 December 2012 to 13 December 2012 

DSP BlackRock Mutual Fund has launched a new fixed maturity plan named as DSP BlackRock FMP – Series 82– 12M, a close-ended income scheme with the duration of 12 months. The New Fund Offer (NFO) price for the scheme is Rs 10 per unit. The new issue will be open for subscription from 7 December 2012 and will close on 13 December 2012. The scheme will mature on 19 December 2012. 

The primary investment objective of the scheme is to seek to generate returns and capital appreciation by investing in a portfolio of debt and money market securities. The scheme will invest only in such securities which mature on or before the date of maturity of the scheme.
The scheme offers a choice of two options, growth option and dividend payout option. 

The scheme would allocate upto 100% of assets in debt securities and money market securities with low to medium risk profile. 

The minimum application amount is Rs 5000 and in multiples of Rs 1 thereafter. 

Entry and exit load charge will be nil for the scheme. Units of the scheme are proposed to be listed on Bombay Stock Exchange. 

Benchmark Index for the scheme is Crisil Short Term Bond Fund Index. 

The scheme will be managed by Dhawal Dalal.

Quantum Mutual Fund Launches A Online Payment Facility “Internet Mobile Payment Service''

With effect from 4 December 2012 

Quantum Mutual Fund has announced the introduction of Internet Mobile Payment Service (IMPS), with effect from 4 December 2012. Accordingly, investors of the fund house shall have an option to pay for the subscription (purchase) application made on the website i.e. www.QuantumMF.com / www.QuantumAMC.com through IMPS.

IDBI Mutual Fund launches IDBI Gilt Fund

NFO Period from 5 December 2012 to 17 December 2012 

Highlights: 

• An open ended dedicated gilt scheme. 

• Opportunity to invest in Gilt Papers with a low lumpsum investment of Rs 5,000/- 

• Approved investment for exempt Provident Funds, Superannuation Funds, Gratuity Funds and under New Pension Scheme 

• Fixed Tenor Trigger (FTT) Plan 

• Easy Exit: 0.5% for exit (repurchase/switch-out/transfer) within 30 days from the date of allotment 

• Minimum investment lumpsum: Rs.5000. SIP : Rs.500/- per month 

• SIP, STP and SWP facilities available 

• Benchmark – CRISIL Gilt Index. 

• NFO Period: December 5, 2012 to December 17, 2012. 

IDBI Mutual Fund today announced the launch of IDBI Gilt Fund, an open ended dedicated gilt scheme. The New Fund Offer (NFO) will open for subscription on December 5, 2012 and close on December 17, 2012. The units will be available at par (Rs.10/-) during the NFO and at NAV related prices thereafter. The scheme will re-open for continuous sale and repurchase from December 27, 2012. 

The investment objective of the scheme is to provide regular income along with opportunities for capital appreciation through investments in a diversified basket of central government securities, state government securities, treasury bills and similar other instruments. 

The benchmark index for the fund is CRISIL Gilt Index. 

Speaking on the occasion, Mr. Debasish Mallick, MD & Chief Executive Officer, IDBI Asset Management Ltd said “IDBI Gilt Fund is an approved instrument for investment by exempt Provident Funds, Superannuation Funds, Gratuity Funds and also under the New Pension Scheme. IDBI Gilt Fund will invest in Gilt securities which bear zero-credit risk and offer adequate liquidity. The Fund will dynamically manage duration of gilt securities so as to optimize returns, in the backdrop of present uncertainties. The launch of IDBI Gilt Fund is in line with our endeavor to offer products across the entire spectrum of investment options to suit all classes of investors and their diverse needs.”

Religare Fixed Maturity Plan - Series XVII - Plan A to F files offer document with Sebi

A close-ended debt scheme 

Religare Mutual Fund has filed offer document with Sebi to launch Religare Fixed Maturity Plan - Series XVII - Plan A to F, a close-ended debt scheme. The New Fund Offer price is Rs 10 per unit. Religare Fixed Maturity Plan - Series XVII - Plan A to F offers plans of tenure from 1 month to 60 months from the date of allotment of the respective Plan(s) (including the date of allotment). 

Investment objective: To generate income by investing in a portfolio of debt and money market instruments maturing on or before the date of maturity of the scheme.
Options: Religare Fixed Maturity Plan - Series XVII offers six plans viz. Plan A, B, C, D, E & F. Each of these Plans offers growth and dividend payout option. Each Fixed Maturity Plan will be managed as a separate portfolio. 

Benchmark: 

For Plans having maturity upto 3 months / 91 days: CRISIL Liquid Fund Index. 

For Plans having maturity of more than 3 months / 91 days and upto 36 months: CRISIL Short-Term Bond Fund Index. 

For Plans having maturity of more than 36 months: CRISIL Composite Bond Fund Index
Loads: Nil 

Minimum Application Amount: Rs.5,000 per application and in multiples of Rs. 10 thereafter. 

Minimum Target Amount: Rs. 20 Crores for each Fixed Maturity Plan. 

Asset Allocation: 

Plans under the Scheme having maturity upto 400 days from the date of allotment: The scheme shall invest upto 100% in debt instruments including money market instruments.
Plans under the Scheme having maturity more than 400 days and upto 1098 days / 3 years from the date of allotment: The scheme shall invest 60%-100% in debt instruments and up to 40% in money market instruments. 

Plans under the Scheme having maturity more than 1098 days / 3 years and upto 1830 days / 5 years from the date of allotment: The scheme shall invest 80%-100% in debt instruments and up to 20% in money market instruments. 

Fund Manager: Mr. Nitish Sikand

Bharti AXA Life launches an improved version of eProtect

Bharti AXA Life Insurance, the private life insurance joint venture between Bharti Enterprises and the world's largest insurance company - AXA, announced the launch of its improved online term insurance plan 'Bharti AXA Life eProtect'. 

Announcing the launch, Sandeep Ghosh, CEO Bharti AXA Life Insurance, said "Online life insurance has shown tremendous growth potential in the last 12 months. We launched our online channel earlier this year with Bharti AXA Life eProtect and the customer response has been very encouraging. Within 6 months of launch, we are currently amongst the top five players in the online term market. We have incorporated customer feedback to our existing term product in the new version of the online product to ensure that it is truly a best in class product in the market". 

Life cover for eProtect has now been increased to age 75 years. The maximum age of entry has been increased to 65 years as well. This is in line with the increased life expectancy in India. "We found that customers today are looking for insurance products that offer comprehensive protection, especially after retirement. An individual's responsibilities towards his family do not necessarily end with retirement. By increasing the tenure of eProtect, we are providing a longer coverage at extremely affordable premiums, making the new version one of the most competitive products in the markets", Sandeep Ghosh added. 

Bharti AXA Life eProtect also provides a unique and industry first service guarantee – "Family Care benefit" that ensures a release of Rs.100,000 during times of distress within 48 hours of claim intimation. To ensure that existing customers do not lose out on this opportunity, Bharti AXA Life will offer the current customers of eProtect an option to upgrade to the new version at a nominal cost. 

Bharti AXA Life eProtect is an easy to buy product available exclusively online at http://buyonline.bharti-axalife.com.