IC - 38 Key Points PDF

# IC - 38 KEY POINTS ## Modern Insurance Concept - Lloyds coffee House London, Sharing of Losses to Many - **Insurance:** Transfer of Risk. - **Insurance Act 1938:** In force 1/07/1939. ## IRDA: Insurance Regulatory and Development Authority - 1999. 1-4-2000. ## H.L.V: Human Life Value - The con...

# IC - 38 KEY POINTS ## Modern Insurance Concept - Lloyds coffee House London, Sharing of Losses to Many - **Insurance:** Transfer of Risk. - **Insurance Act 1938:** In force 1/07/1939. ## IRDA: Insurance Regulatory and Development Authority - 1999. 1-4-2000. ## H.L.V: Human Life Value - The concept was developed by Professor HUBENER. ## Elements of a Valid Contract - 1. Offer and Acceptance - 2. Consideration - 3. Agreement between two parties [Consensus ad idem] - 4. Free consent - 5. Capacity of the Parties ## Free Consent - *(a)* Coercion - *(b)* Undue Influence - *(c)* Fraud - *(d)* Misrepresentation ## "Uberrima Fides" or Utmost Good Faith - The Law imposes an Obligation to Disclose all Material Facts (family, medical history, financial occupational details, illness) ## Insurable Interest - Self, Spouse's life, Children's life, Assets owned, Keyman. ## Saving - Postponement of Consumption and Parting with Liquidity. ## Financial Products - **Transactional Products:** Bank Deposits. - **Contingency:** Insurance. - **Wealth Accumulation:** Shares / Mutual Funds / Real Estate ## Life Insurance - Is a product that is Intangible. ## Traditional Plan - **Term Plan:** Death benefit, Lowest Premium. No Saving Element. - *(Increasing term, Return of Premium)* - **Endowment plan** - **Whole Life** ## Money Back Policy - Periodical benefits, SURVIVAL CLAIM ## Decreasing Term Assurance - Mortgage Redemption Insurance (MRI) Premium will remain CONSTANT. - It is like Decreasing term Assurance, Credit life Insurance. ## Universal Life Insurance - 1975 USA - Non Traditional Life Insurance. ## Unit Linked Insurance Plans - Variable INS plans in India U.K - FUND VALUE ## Public Pension Schemes - **Pay As You Go (PAYG)** - **Commutation Of Pension:** 1/3 rd of the Accumulated value can be withdrawn and it is Tax free. ## Health Insurance - Morbidity - illness, Sec 80D ### Sub-centre's Information - 5000 population (Rural), 3000 population (Hilly, Tribal) 1 female worker and 1 male worker. - 1 Primary Health Centre's (PHC): 6 sub-centre's 30,000 Population (rural), 20000 population (Hilly, Tribal) - They provide Outpatient services. - 4-6 beds - 14 para medical workers - 1 medical officer. ## Community Health Centres - Referral units for 4 Primary health centre's - For 1 Lakh population, 30 beds loperation theatre, 4 specialists 1 surgeon. ## Third Party Administrator (TPA) - Cash less Facility. - They should complete 24hrs service. - Day care service for below 24 hrs. ## Portability - Transferring the credit gained for pre existing conditions ## Married Women Property Act 1874(MWPA) - SEC-6 Trustee will be framed -- Wife & Children. - Court and Creditors cannot touch the property. (State official Trust). ## Key Man Insurance - KEY MAN means - Important person to the Business, for the Profitability of the Company. - Claim - Death, Unable to work. claim is Taxable. ## Surplus - Excess of ASSETS over Liabilities If not STRAIN calculated by ACTUARY. - **Book value:** - Simple Reversionary Bonus, - Compound Reversionary - Interest calculated on already attached Bonus, - Terminal Bonus- Paid Once during policy Term. ## Prospectus - Details about the Product ## Proposal Form - Application to L.I ## Standar Age Proof - DOB, SSC, PAN,D.L,PASSPORT, Defence ID Card, Service Reg ## Non-Standard - Horoscope, rationcard, Panchayat certificate, self (Elder) declaration. ## Prevention of Money Laundering (PMLA) 2002 - Inforce 2005, AML - Anti Money Laundering - KYC-ID Proof, Address Proof, Income Proof. ## First Premium Receipt: (FPR) - Evidance that Policy Contract has Began. ## Policy Bond - Evidance of contrtact between INSURER and INSURED. 3 parts - A: Policy Schedule - B: Standard provisions - C: Specific policy provisions. ## Free Look Period - Coolin Period - 15 Days from receiving of Policy BOND. ## Grace Period - 1 Month or 31 days. - Due date : Premium payment date. ## Non-Forfeiture - **Paid up:** at least 3 yrs premium, cash value - 3 yrs - **Surrender:** withdraw from contract, Loan processed on this value. ## Policy Revival - *(a)* Ordinary Revival - *(b)* Special Revival - *(c)* Loan cum Revival ## Nomination - Sec 39 of Insurance Act 1938, Nominate any number - Right on Death claim only. - When Nominee is a Minor - Appointee ## Assignment - Sec 38 Insurance Act 1938, Transfer of Property by writing. ## Risk Classification - *(a)* Standard Lives- Ordinary Rates - *(b)* Sub Standard Lives - Extra Premium - *(c)* Preferred Lives - Low Premium - *(d)* Declined Lives - Un Insured. ## Hazards - *(a)* Physical - *(b)* Moral Hazard - *(c)* Occupational Hazard - *(d)* Accidental. ## Underwriting Types - 1) Numerical Rating - 2) Judgemental - Complex cases only. ## Claim - **Demand:** Death, Maturity, Suicide, Missing Person. ## Presumption of Death - INDIAN EVIDANCE ACT 1872 - A person is reported missing for 7 yrs, F.I.R copy, Premium continues to pay without Lapse. ## Agent: - Sec42. Representative of Insurance Co-Primary Underwriter. - 10th / 12th Class, 50 Hrs Training, Licence valid for 3 yrs, 25 hrs Renewal Training, Rs.250 Fees. ## Composite Agent: - Both LIFE & GENERAL. - 1st time 75hrs, Renewal 35Hrs. ## Prospecting: - Interview - Need Gap Analysis ## Objection Handling: - L.A.P.A.C- Listen, Acknowledge, Probe, Answer, Confirm ## IGMS-INTERGRATED GRIEVANCE MANAGEMENT SYSTEM ## Insurance Ambudsman 1998 - Central Govt Special Provision: Rs 20 lakhs below complaint before 1 yr, In written only, Issue Award 3 months or 90 days. No fees. ## COPA 1986 - Consumer Protection Act - - 1) District Forum Rs.20 lakhs below. - 2) State Commision 20-100 Lakhs -3) National Commision 100 lakhs and above. - Complaint before 2 yrs. - State Comission established under - SEC 24(B) ## Agent Form 1A - LICENCE cancelation - after 90 days of getting Licence. ## Composit Agent Application - Form 1B ## Moral Hazard: - Increasing Risky behaviour following the purchase of INSURANCE. ## Cash Value - 3Yrs of payment of Premium - Sec 45 -INDISPUTABILITY CLAUSE - 2Yrs ## Surrender of Policy - Withdraw from the contract. ## Sec 41(1) No Rebate - Agent should not give Rebate by way of sharing Commission. ## Actuary - Mortality tables, new Policy design, Premium calculation. ## Normal Claim - Payment - Enquiry 30 days, - Accidental Death - 6 Months/180 days ## First Life Insurance Company in the World - Amicable Society for an Perpetual Assurance, 1706 London ## First Life Insurance Company in India, English company - Oriental Life Insurance Company Limited in 1818, Calcutta ## First Non Life Insurance Company in India - Triton Insurance company Limited in 1850, Calcutta ## The First Indian Insurance Company - Bombay Mutual Assurance Society Limited, 1870 Bombay ## The Oldest Insurance Company in India which still exists today? - National Insurance Company Limited, 1906 ## Life Insurance Business was nationalized on? - Sep 1st 1956 ## GIBNA, Non Life Insurance business was nationalized on? - 1972 ## Persistency Guidelines - 1-7-2014 ## IRDA has prescribed Agent code of ethics - Effective September 2012, ## Apart from individual agency, other insurance channels include: - Corporate agency, Brokers, Bancassurance, ## Direct marketing -Agency INDIRECT - Bancsssurance, Brokers, C Agency. ## P.P.T -PREFERED PRIVIDER NETWORK. C.P.T - Current Procedual Terminology ## 1st Life Ins Co in the world - Amicable society for Perpetual assurance. ## Non - Life ins business was nationalized - in 1972 by amalgamating 106 insurers, General Ins Corporation of India(GIC) and its 4 subsidiaries. ## Bhavishya Arogya Policy: - Introduced in 1990-Age: 25 years to 55 years. ## Pradhan Mantri Suraksha Bima Yogana (PMSBY) - Overing personal accident death and disability cover Age 18-70 yrs. - Sum Assured: Rs. 2,00,000.. - The cover shall be for the one year period from 1st June to 31st May. ## Insurance Market - Natural Market, Immediate, Center Of infuleance (COI). ## Sales Call: - Cold call, Warm Call, Hot call ## ESI Act - Employees State Insurance Scheme? 1948 ## Central Government Health Scheme - CGHS was introduced? 1954 ## IRA Insurance Regulatory Authority - was established? a. 1997 ## Malhotra Committee - was set up on? a. 1993 ## Malhotra Committee - submitted its report on? a. 1994