According to official data, non-oil exports reached RO 5.659 billion, accounting for 28.6 percent of the Sultanate’s total exports. These exports include a wide range of products such as industrial goods, metals, plastics, machinery, electrical equipment, and chemicals, showcasing the strength of Oman’s manufacturing and industrial base.

The growth comes amid a national push to reduce reliance on oil revenues, support private sector participation, and localise key industrial projects. Authorities have introduced various incentives and streamlined procedures to attract both local and international investors.

The United Arab Emirates was the top destination for Omani non-oil exports, receiving goods worth RO 292 million, or 18 percent of total non-oil exports. Saudi Arabia followed with RO 259 million, while India received RO 172 million worth of goods. South Korea and the United States ranked fourth and fifth with RO 154 million and RO 88 million respectively.

Despite the growth in non-oil trade, Oman’s oil exports declined in the first quarter, falling to RO 3.690 billion compared to RO 4.391 billion in the same period last year. The drop was attributed to a decrease in global oil prices, with the average price of Omani crude standing at $75.3 per barrel, down from $79.7 per barrel in Q1 of the previous year.

Re-exports also witnessed a downturn, dropping to RO 351 million from RO 434 million in Q1 last year. The UAE remained the top destination for re-exported goods from Oman, receiving RO 126 million worth, followed by Iran (RO 63 million), Kuwait (RO 24 million), Saudi Arabia (RO 22 million), and Germany (RO 10 million).

On the import side, Oman saw a 10.9 percent increase in commodity imports, which rose to RO 4.312 billion compared to RO 3.889 billion during the same period last year. The UAE led the list of exporters to Oman with RO 995 million, accounting for 23 percent of total imports. Kuwait, China, India, and Saudi Arabia followed in the top five.

This overall trade performance underscores Oman’s steady progress toward a more diversified and resilient economy, with strategic emphasis on non-oil sectors and enhanced trade relations with key global partners.

The post Oman’s Non-Oil Exports Rise 8.6% in Q1, Driven by Diversification and Industrial Growth appeared first on The Gulf Indians.

There are three things that can happen when you make a claim on a health insurance policy. The insurance company may approve the claim, deny the claim, and proceed with the claim settlement process. These three claims are categorized into three types: claims paid, insured, and pending in the insurance company records. There is also a fourth category. This category is classified as closed claims.

These are claims that have not yet been settled due to the insured person not submitting the required documents. Insurance companies do not include such claims in the list of claims that have been denied. This is because the claim is denied only after examining the nature of the claim and the required documents. At the same time, claims are considered closed claims in cases where the claim application has been submitted but the required documents have not been received or the policyholder has not yet taken appropriate steps in submitting documents for the necessary proceedings.

For example, if a policyholder applies for a cashless claim but is not admitted to the hospital, it will be treated as a closed claim. Or if you apply for a refund after the hospital stay and fails to submit the required documents, it will also fall under the category of closed claims.

Closed claims are classified not only in the case of health insurance but also in the case of other types of insurance. Insurance companies do this to reduce the number of rejected claims.

The claim settlement is based on the ratio of an insurance company to the extent to which it is generous in awarding a claim. It should be noted that if the claim settlement ratio is high, the company will allow a higher rate of claims in proportion to the number of claims received. Closed claims will not be considered when calculating the claim settlement ratio. This helps the insurance companies to increase the ratio. At the same time, not all insurance companies classify as closed claims.

To make a claim, you need to fill up the relevant form and submit it to the insurance company. If the required documents are not submitted along with it, the insurance company will request it. The insurance company usually specifies that the documents must be submitted within the stipulated time. At the same time, a claim cannot be denied simply because the documents were not submitted within the stipulated time. If the reason for the delay in submitting the documents is proved, the insurance company will be ready to settle the claim.

The post Will the insurance claim be denied if the documents are not submitted? appeared first on The Gulf Indians.

Banks offer personal loans, especially with no collateral. Therefore, the interest rates on such unsecured loans are very high. At the same time, life insurance companies, including LIC, offer personal loans as a fixed percentage of the surrender value of insurance policies.

The interest rates on such secured loans are lower than the interest rates on bank personal loans and bank loans on the security of insurance policies. This is one of the reasons why LIC stands with banks in providing personal loans.

Loans are available only those who have endowment policies and moneyback policies. Loans are not guaranteed on term policies that do not have a surrender value or on ULIPs that fluctuate in value of the investment due to fluctuations in the stock market.

The loan is available only after a certain number of years after taking out the policy. If the policy is terminated before the end of the term, the loan holder will receive 85-90 per cent of the surrender value.

Flexible conditions have been devised for the repayment of LIC loan amount and interest. Policyholders can apply interest free repayment every year by deducting the loan amount from the amount received at the end of the policy term. At the same time, if such loans are taken from banks, the interest rates and repayment rules vary from bank to bank. The method of deducting the loan amount from the settlement without repaying the loan is very beneficial to the policyholders. Such a loan is a way for policyholders to find money for urgent needs.

The advantage of such loans is that they are easily and quickly available with minimal procedures. There is no problem with loan denial. It is a reliable way of lending to people with low credit score and poor creditworthiness.

At the same time, policyholders should keep in mind that if the loan is not repaid immediately, the nominees will not receive the full benefit of the insurance at the claim stage.

LIC is one of the largest lenders of personal loans in India. It shows the size of the life insurance industry and related financial business in the country.

The post You can get a loan by mortgaging LIC policy appeared first on The Gulf Indians.

Navi General Insurance has launched a ‘2-Minutes’ online retail health insurance product. Customers can buy health insurance via the Navi Health Insurance App through a quick and completely paperless process that takes just 2 minutes, with the policy issued to them instantly on the app.

The product offers customisable health insurance cover ranging from Rs.2 Lakh to Rs.1 Crore for individuals and families. Claims can be initiated by calling the helpline, with most Cashless Claims being approved within 20 minutes. Navi Health Insurance has an industry-leading Claim Settlement Ratio of 98% for Health claims and a network of 10,000+ cashless hospitals across 400+ locations in India. Customers can download the Navi Health Insurance app from Google Play Store. Download link here.

Navi Health offers comprehensive health insurance that covers more than 20 health benefits including in-patient hospitalization, pre and post hospitalization expenses, COVID 19 hospitalization, domiciliary hospitalization, 393 day-care procedures, road ambulance cover, vector-borne disease cover and optional critical illness, maternity and newborn baby cover.

Customers can make any number of claims in a year subject to the upper limit of the Sum Insured opted for. Customers can also get reimbursed for treatment availed in any non-network hospital in India with claims settlement in 4 hours subject to complete documentation. The plan offers lifetime renewal without having to undergo medical check-up on each renewal, unless the customer wishes to enhance the Sum Insured on renewal. 100% of the base Sum Insured is automatically reinstated upon exhaustion once during each policy year. All processes are completely online with no agents involved.

The product also offers an ‘Extra Care’ Cover, an in-built additional Sum Insured of Rs.20,000 for hospitalization due to dengue, malaria, swine flu and other listed vector borne diseases, without impacting the Base Sum Insured.

According to Ramchandra Pandit, MD & CEO, Navi General Insurance “With our health insurance offering, our objective is to radically simplify health insurance for individuals and families. From purchasing a paperless policy within minutes via the app, to easily understandable but comprehensive policies, to hassle-free claims settlement, Navi Health aims to completely change customers’ perception that buying and availing health insurance is complex and cumbersome. With more and more people preferring digital channels for all their needs, we believe our online health insurance product offering transparent benefits, speed, simplicity and convenience will be well received by customers.”

Navi’s mission is to leverage the intersection of finance and technology to offer customers financial services that are simple, affordable and accessible. Founded by Sachin Bansal and Ankit Agarwal, Navi is headquartered in Bangalore.

The post Navi General Insurance launches ‘2-Minutes Online Health Insurance’ via Navi Health App appeared first on The Gulf Indians.

Family floater policies are unique in that they cover all members of the family under one policy, rather than taking out individual health insurance policies. For example, if there are three members in a family, instead of taking special policies with a coverage of Rs.1 lakh per person, you can take a family floater policy with floating coverage of up to Rs.3 lakh for three persons.

The advantage of taking out a Family Floater policy that covers the whole family together is that the cost of the premium item is reduced. The Family Floater policy comes with a lower premium than the one you have to pay for a particular policy. Doing so can save up to 30% of the premium.

Let us see how the Family Floater policy works. For example, a family with a family floater policy of Rs.3 lakh can get floating coverage of up to Rs.3 lakhs. Suppose the head of the family is admitted to the hospital and the hospital expenses are Rs.2.5 lakhs. The entire cost can be claimed under the Family Floater Policy. At the same time, if individual policies are taken out with a coverage of Rs.1 lakh per person in the family, the head of the family will get a maximum claim of only Rs.1 lakh.

However, family floater policies have some drawbacks. Family floater policies are renewed based on the age of the senior member of the family. Most family floater policies cannot be renewed after the age of 60 for a senior member of the family. This means that when a senior member of the family turns 60, he or she will have to take out a special policy for senior citizens and individual policies for other members.

When taking out new policies, one has to wait for 3-4 years to get coverage for existing diseases. No claim bonus will also be forfeited on non-claim basis.

Statistics show that the demand for family floater policies is on the rise as the cost of health insurance continues to rise. This trend is reflected in the figures of those health insurance sales. The sale of family floater policies is more profitable for the insurance companies as it is very rare for a claim to be made for the entire sum insured.

Care should be taken to ensure adequate coverage when taking out a health insurance policy. The coverage amount needs to be increased adequately in the event of a surge in hospital accommodation and medical expenses.

The post How to reduce health insurance policy premium appeared first on The Gulf Indians.

Deloitte India Partner and Financial Services Industry Leader Sanjoy Datta said the announcement to raise the FDI cap in the sector was a much-awaited move by the government. It is in direct recognition of the requirement for significant capital inflows to provide adequate levels of insurance cover to the population, he added.

The proposed increase in FDI would also likely result in increased value for customers by way of more product options at reduced costs, he said.

“We see a possibility of select foreign partners in existing insurance JV’s (joint venture) seeking to increase ownership levels, attractive valuation for exits for existing investors (domestic and foreign) as well as the entry of new investors who prefer majority equity holding in the entity,” he said.

Finance Minister Nirmala Sitharaman in her Budget Speech 2021 proposed to amend the Insurance Act, 1938, to increase the permissible FDI limit from 49 per cent to 74 per cent in insurance companies and allow foreign ownership and control with safeguards.

Shardul Amarchand Mangaldas & Co. Partner Shailaja Lall said a more liberal FDI policy will certainly attract higher amounts of foreign capital, which will aid in increasing insurance penetration in India.

“While this is a welcome move by the government, foreign investors will certainly view this development with ‘a pinch of salt’ and like to take a cautious approach. Much will depend upon the fine print of the conditions being proposed,” Lall said.

She said that once there is more clarity, it will need to be seen as to how many foreign investors are willing to infuse capital, without the ability to control the board.

“Any conditionality and regulatory approvals attached to payment of dividends to foreign investors may add another level of complexity. It is possible that the Irdai may also prescribe certain conditions to safeguard policyholder moneys,” she said.

The post FDI cap hike to raise insurance penetration appeared first on The Gulf Indians.

It is part of financial planning to take out a life insurance policy to secure the future of those who depend on you. The responsibility of the policyholder does not end with taking the policy. Adequate coverage as well as sufficieny time period should be ensured.

Term policies to be taken out for life insurance. Do not take investment policies for any reason. But it was not just enough to take out a term policy. One also needs to look at whether it is adequately linked to the goals. The term of a term policy should be the period during which a person works and earns income.

It is rare for a man to take out a life insurance policy in the name of his housewife. This is because housewives do not generate income and other family members do not depend on them financially. But activities of housewives in a house cannot be ignored as having no economic value. Therefore, the cost of maintaining the home and caring for the children in her absense must be taken into considerationl. Therefore, taking out a life insurance policy in the wife’s name will further strengthen financial planning.

Doubts may also arise as to whether life insurance is required in the case of working couples. This is because husband and wife are not financially dependent on each other. But if one of the spouses dies, it will be difficult for the other to maintain the standard of living due to fall in income. If the two have taken out a joint loan, such as a home loan, it will become a liability. Therefore, both spouses need adequate insurance coverage even if they are working. The loan repayment amount should also be taken into consideration when deciding the amount of insurance.

Care must be taken to enter the nominee’s name correctly. If there is any change in the nomination, care should be taken to correct it in a timely manner. Unmarried people nominate their parents. Care should be taken to transfer it to the name of the life partner after marriage.

Another thing to keep in mind is to increase your life insurance coverage when needed. An unmarried person may not have the required life insurance coverage after he or she is married. The need for life insurance coverage will increase when you have children and take out a home loan. Accordingly, a new policy needs to be taken and coverage increased.

The post Things to look out for when taking out term insurance appeared first on The Gulf Indians.

Although health insurance policies are designed to cover hospital costs up to a certain amount, there are limits on expenses such as room rent, and the policyholder will have to bear the excess costs. Such limits are imposed to limit the liability of the insurance company in the event of a claim.

The room rental limit is the main condition that determines the insurance claim. Therefore, special attention should be paid to the terms of the policy in this regard.

Many policies allow a fixed percentage of the sum insured as the maximum room rent. For example, suppose the daily room rent is limited to one per cent of the sum insured. If the rent exceeds this limit, the policyholder will have to bear the amount above the limit on his own. In the case of a sum insured policy of Rs.1 lakh, if the room rent is more than Rs.1,000, the policyholder will have to pay a proportionate share of the other expenses incurred in the final bill.

Let us see how the room rent limit is reflected in the claim. Depending on what type of room is taken in the hospital, rent, examination fees, surgery costs, nursing fees, and other expenses are calculated. If the room goes above the rent limit, the insurance company will only pay a certain amount of the total claim amount.

For example, suppose you have a sum insured policy of Rs.3 lakhs and the ceiling of the slum is one per cent of the sum insured. That is, you can claim a maximum of Rs.3,000 in rent. At the same time, suppose the hospital gets a room with a rent of Rs.4,000. You will have to pay out of your own pocket Rs.1,000. If the total bill amount is Rs. 3 lakhs, only a proportionate claim will be received. The insurance company will only allow a claim of Rs.2.25 lakh depending on the room rent limit. The remaining Rs.75,000 will have to be paid from his own pocket.

There are several types of room rental policies available in the market. At the same time, the terms and conditions of the insurance policy vary from company to company. Most companies set a limit of up to a certain sum insured and do not set a limit on it.

Some companies set a limit on sum insured policies of less than Rs.5 lakh, but do not set a room rental limit on sum insured policies of Rs.5 lakh or more.

The post Hospital room rental limits will be reflected in insurance claim amount appeared first on The Gulf Indians.

Discontinuing a health insurance policy for any reason or taking out a new policy can result in the loss of many existing benefits. Instead, policyholders have the opportunity to ‘port’ a health insurance policy. This is a facility to purchase a new policy by terminating the existing policy if it is not satisfactory and retaining the benefits provided by the existing policy.

The portability of that insurance is equivalent to transferring from one company to another company of the customer’s choice without changing the mobile phone connection number. Not only will you not be covered for any existing illness when taking out a new policy, but you will also have to wait for up to 30 days for coverage after taking out a new policy. However, with the advent of health insurance portability, the consumer has the opportunity to change his or her health insurance service provider at any time.

Benefits, including coverage for existing illnesses, will continue under the new policy when moving from the old insurance company to the new insurance company. Those who want to switch from policies that require a higher premium to policies that have a relatively lower limit for expenses such as room rent can opt for policies of their choice and policies that do not make a significant difference in the sum assured.

To transfer the policy to another company, the policyholder has to fill in the form and submit the new proposal form to the company with which he intends to transfer the policy to that company. At the same time, the insurance company has the sole right to decide on the application to transfer the policy to another company. That is, if an insurance company rejects an application to change the policy, the customer will have to approach another insurance company to change the policy.

Notice of Renewal of Policy or previous year’s policy document and documents related to previous medical history should also be submitted. The IRDA (Insurance Regulatory and Development Authority) stipulates that the company must reply to the customer within 15 days of receipt of the application. The company will not have the power to reject the application or terminate the policy after 15 days.

According to IRDA rules, cancellation of the policy can be avoided if the premium is paid within 30 days after the expiry of the policy. At the same time, the customer must apply at least 45 days before the policy expires to transfer the policy to another company. No claim bonus under current policy cannot be ported. It cannot be ported even if the application is submitted after the expiry of the existing policy.

The post Things to consider when transferring health insurance to another company appeared first on The Gulf Indians.

Ratheesh’s health insurance policy renewal date was November 1. But he did not remember to renew it on time. Ratheesh recalled that he had not renewed his health insurance policy when the doctor told him that he would have to undergo an operation at the end of December. He decided to pay the premium immediately but could not renew the policy. The grace period for renewing the policy was already over. That is, he had lost policy coverage. He then had to bear the entire cost of the hospital on his own.

Some of the health insurance policyholders, like Ratheesh, do not remember to renew the policy on time. The result is a loss of policy coverage until then. When one has to get expensive treatment in hospital, they are without any protection. Moreover, with the premium paid for such a long time to get the coverage, it goes without any benefit. The consumer also loses the premium paid for so many years.

Care should be taken to renew the policy on time to avoid such situations. It would be best to pay the premium before the date of renewal. The insurance company usually sends a renewal notice 45 days before the policy renewal date.
The grace period of insurance policies is 30 days. That is, the policy can be renewed within 30 days from the date of renewal of the policy by paying the premium without penalty. At the same time policy coverage will not be available during the grace period. Coverage is only available until the policy renewal date. Therefore, no coverage will be available for hospital expenses in the days prior to the renewal of the policy during the grace period. The coverage will be available again after paying the premium.

The policy cannot be renewed after the grace period. Therefore, if the premium is paid after the grace period, it will be equivalent to taking out a new policy. If necessary, a medical examination may be needed. The waiting period when applying for a new policy will apply again. For example, if the policy of the previous policy stipulates that coverage will not be available for existing illnesses for up to four years, this will come into play again. The four-year waiting period is applicable again even if the earlier policy was taken two years ago.

Another drawback is that the no claim bonus is lost. No claim bonus will be available if there is no claim in the first years after taking the policy. For example, suppose a policy of Rs. 5 lakhs receives a no claim bonus of Rs. 50,000 in that year. This bonus will be forfeited if the policy is not renewed on time.

The post If health insurance is not renewed on time appeared first on The Gulf Indians.

Although car insurance companies offer lower premiums, it is important to check whether such policies provide adequate coverage. The insured declared value (IDV) of the car may decrease as the premium decreases. This can lead to a decrease in insurance coverage.

The sum insured amount of a car insurance policy is the declared value of the car’s insurance. Claims are settled on the basis of the amount insured by the car in the event of a car being stolen or damaged beyond repair. So the car owner should not focus on taking a premium low policy. The premium should be compared only after ensuring adequate insured declaration value.

A comprehensive car insurance policy covers two types of risks. The first coverage is for damage to the car. The second is coverage in the event of damage to another vehicle or accident to another person while driving. The premium for the second coverage is determined by law. At the same time the premium for the first coverage is determined based on the car’s insured declared value. That is why the car’s insured-declared value comes into play when taking out and renewing a car insurance policy.

When buying a new car, the insured declared value is determined based on the selling price. The insured declared value of a new car is determined after deducting the depreciation rate from the ex-showroom price. Normally, the depreciation rate of new cars is 5 per cent. That is, the maximum insurance for a new car will be 95 per cent of the declared value added to the showroom price.

As the car exits the showroom, the depreciation rate rises and the insured declared value decreases. Every year the value of the insured declared value decreases at a fixed rate. One year after buying the car, the insured declared value decreases by 15 per cent. In subsequent years it decreases by 20 per cent, 30 per cent and 40 per cent. Five years after the purchase of the car, the insured-declared value will be only 50 per cent of the purchase price. The Insured Declared Value is determined by the depreciation rate each time the premium is renewed. At the same time, the owner has the opportunity to determine the insured declared value of the car on his own. Each insurance company has set a lower limit and a higher limit for IDV, which can be determined in this way. Premium will also change according to IDV. As IDV decreases, the premium decreases.

A claim equal to IDV is determined in two circumstances. IDV can be fully claimed if the car is stolen or 75 per cent damaged in an accident that cannot be repaired. If the car is stolen, the claim is not settled immediately. If the car is not found during the police investigation, the claim will be settled only after a few months. Similarly, if the car breaks down beyond repair, 75 per cent of the damage will be found only if it is found by a specialised agent, and IDV will receive an equivalent claim.

The IDV for cars older than five years is determined by mutual agreement between the car owner and the insurance company. Damage coverage for such cars is generally higher.

In short, car owners need to understand that it is advisable to set a sufficient IDV, even if the premium is slightly increased, in order to get adequate coverage for the car, even if the IDV is reduced.

The post Do not try to save on car insurance premium appeared first on The Gulf Indians.

Borrowers have an obligation to ensure the repayment of the loan. Buying or building a home is only the beginning of a dream come true. Do not assume that by owning a home your dreams have come true. We also need to take care to cover some of the risks through insurance so that the house can always be our own.

If there is any default in repaying the loan, the repayment will become the burden of the family members. If the family members are not able to fulfill that obligation, they may face consequences like bank foreclosure. Care should be taken to ensure insurance coverage in anticipation of such risks.

Interruption of EMI repayment can be due to two reasons. The first is the death of the borrower. The second is the loss of physical ability to work due to illness or accident. Insurance coverage is required to deal with both of these situations.

Term insurance policy is a way to prevent loan default due to the death of the borrower. Term insurance is one of the basic types of insurance that an individual needs. Life insurance fully fulfills the goal of maintaining the financial status of the family in the event of untimely death of the family’s main source of income through term policies aimed at higher insurance coverage.

Term policies with the sole purpose of life insurance are available at a relatively low premium compared to insurance. Nominee will receive Sum Assured in case of death of the insured.

Coverage should be ensured through the Critical Illness Plan in case of loss of physical fitness for work and income due to illness or accident. Term plans include term policies that have Critical Illness Rider. Such riders pay sum insured in case of serious illnesses such as cancer and heart disease. There are also riders who pay a fixed amount per month.

Double term coverage is unavoidable for double income families. When both spouses earn the same amount of income, both need protection equally when they take out joint loans and other things like loan repayment.

Since the death of one of the life partners can affect things like loan repayment, both parties definitely need to ensure protection. So both parties need to have a term plan and a critical illness plan.

The post Insurance protection for your house appeared first on The Gulf Indians.

Earlier, personal health insurance policies did not cover maternity care. Only group insurance policies cover maternity care. Personal health insurance policies have been available in the market for the past few years that cover maternity care as well.

In the past, maternity care was denied coverage because the insurance covers unforeseen medical expenses and does not cover maternity leave. Insurance companies changed this position as part of their strategy to expand policy sales.

Almost all new trends in the insurance industry are initiated by private insurance companies. Maternity insurance policies were also first marketed by private insurance companies. Now, public sector general insurance companies are also launching similar policies in the market. It is important to understand the terms and conditions of these policies before embarking on such personal policies as they cover the maternity hospital expenses only.

Policies covering maternity hospital expenses limit such expenses. Maternity care coverage offered by most policies is only 10 per cent to 20 per cent of the policy amount. For example, in a policy of Rs 1 lakh, the coverage for a normal delivery is only Rs.10,000 to Rs.20,000. This limit may be slightly higher in group insurance policies.

In most of these insurance products, maternity care is covered only after a certain period after the policy is taken out. The waiting period is four to six years. In the case of group insurance policies, the waiting period is only up to nine months.

If the policies are taken for the sole purpose of covering maternity hospital expenses, the real benefit will often not accrue to the consumers. If the premium paid during the waiting period is effectively invested, the hospital expenses can only be recovered. This amount can be deposited in a mutual fund or post office time deposit. Also, take into account the fact that the claim amount is allowed only up to a certain limit of the cost of maternity care.

Since a health insurance policy is a cover for various types of medical expenses, a policy should be taken only with such a view. Only those who do not actually have group insurance coverage should consider taking out such policies. Those with adequate group insurance coverage do not need such policies.

The post Does maternity care require special insurance? appeared first on The Gulf Indians.

Life insurance companies use a variety of strategies to attract customers. A few years ago, stock-linked insurance policies, known as ULIPs, tended to sell with false profit potential. Among such strategies is the promise of a guaranteed return on certain insurance policies.

Almost all life insurance companies have guaranteed life insurance plans that fall under the category of endowment policies. Instead of declaring a bonus on such policies (the bonus will fluctuate according to the profit the insurance company makes) a sum called Guaranteed Return is paid.

Guaranteed returns vary from plan to plan. Some plans offer a guaranteed return based on the sum assured. Some plans include a guaranteed return from the second year of the policy. At the same time, some other plans include a guaranteed return only after a few years.

Some plans, like money-back plans, pay regular income to the policyholder at regular intervals. In some other plans a lump sum is received at the end of the policy term. In some plans, income is paid in fixed years after maturity.

The return that the insurance company actually claims to pay on such plans is lower than that received from fixed deposits. The return received by the investor ranges from four per cent to six per cent from standard endowment and money back policies. The return from guaranteed return plans is even lower.

Let’s look at an example. Suppose a policy with tenure of ten years and the policy holder has to pay premium for eight years. 150% of the premium is refunded to the policyholder for the next eight years after the end of the policy term. It’s natural to think this return is attractive. But what is the actual return received by the policyholder?

Even though the premium is payable for eight years the policy coverage is for ten years. Ten years later, the next eight years will be income-generating. If 20,000 is the annual premium and Rs. 30,000 is the annual premium. In fact, the policyholder’s return on this income from the tenth to the seventeenth year is only 2.9 per cent. The policyholder is actually being deceived.

The post Gimmick of guaranteed return appeared first on The Gulf Indians.

Although car insurance companies offer lower premiums, it is important to check whether such policies provide adequate coverage. The insured declared value (IDV) of the car may decrease as the premium decreases. This can lead to a decrease in insurance coverage.

The sum insured amount of a car insurance policy is the declared value of the car’s insurance. Claims are settled on the basis of the amount insured by the car in the event of a car being stolen or damaged beyond repair. So the car owner should not focus on taking a low premium policy. The premium should be compared only after ensuring adequate insured declaration value.

A comprehensive car insurance policy covers two types of risks. The first coverage is for damage to the car. The second is coverage in the event of damage to another vehicle or accident to another person while driving. The premium for the second coverage is determined by law. At the same time the premium for the first coverage is determined based on the car’s insured declared value. That is why the car’s insured-declared value comes into play when taking out and renewing a car insurance policy.

When buying a new car, the insured declared value is determined based on the selling price. The insured declared value of a new car is determined after deducting the depreciation rate from the ex-showroom price. Normally, the depreciation rate of new cars is 5%. That is, the maximum insurance for a new car will be 95% of the declared value added to the showroom price.

As soon as the car exits the showroom, the depreciation rate increases and the insured declared value decreases. Every year the value of the insured car decreases at a fixed rate. One year after buying the car, the insured declared value decreases by 15 per cent. In subsequent years it decreases by 20 per cent, 30 per cent and 40 per cent. Five years after the purchase of the car, the insured-declared value will be only 50 per cent of the purchase price.

The Insured Declared Value is determined by the depreciation rate each time the premium is renewed. At the same time, the owner has the opportunity to determine the insured declared value of the car on his own. Each insurance company has set a lower limit and a higher limit for IDV, which can be determined in this way. Premium will also change according to IDV. As IDV decreases, the premium decreases.

A claim equal to IDV is determined in two circumstances. IDV can be fully claimed if the car is stolen or 75 per cent damaged in an accident that cannot be repaired. If the car is stolen, the claim is not settled immediately. If the car is not found during the police investigation, the claim will be settled only after a few months. Similarly, if the car breaks down beyond repair, 75 per cent of the damage will be found only if the inspection by special agents reveals that the IDV will receive an equivalent claim amount.

The IDV for cars older than five years is determined by mutual agreement between the car owner and the insurance company. Damage coverage for such cars is generally higher.

In short, car owners need to understand that it is advisable to set a sufficient IDV, even if the premium is slightly increased, in order to get adequate coverage for the car, even if the IDV is reduced.

The post Don’t try to save on car insurance premium appeared first on The Gulf Indians.

Recently, the headline of an article on the business page of a leading Malayalam newspaper was: ‘ULIP is more important in financial planning’. This note, written by a top official of a leading life insurance company, says something misleading.

The note reads: “One of the key features of ULIPs is that it provides insurance and protection as well as investment opportunities in the market.” The fact is that the benefits of saving time and money through a single plan can be misleading.

The unscientific combination of investment and insurance in ULIPs does not serve these two purposes properly. When choosing insurance products such as ULIP, the basic goal of financial planning, which is the required insurance, goes unfulfilled. Insurance is not really for investment. Life insurance is intended to ensure that the financial status of the family is maintained for a long period of time in the event of an untimely death of the family’s source of income.

A person’s life should be insured for a sum of at least 10-15 times the annual income of the person. This goal is fully achieved through term policies aimed at higher insurance coverage. Term policies with the sole purpose of life insurance are available at a relatively low premium compared to the sum insured.

Mutual funds are better for investment than ULIPs. The charge for insurance products is higher than for mutual funds. SEBI (Securities and Exchange Board of India), the regulatory authority for mutual funds, has sharply reduced the charges for mutual funds.

Although the rates charged by ULIPs on various items are lower than in the past, they are still expensive investment products compared to mutual funds. Mortality charges levied by ULIPs etc. will reduce the final investment value.

Excluding transaction rates, ULIPs offer returns of three to five per cent lower than mutual funds, even considering NAV – based returns. The difference is huge for someone who has been investing for fifteen to twenty years.

It is best not to confuse insurance with investment. Instead of buying ULIPs, you should opt for mutual funds for investment and take out term policies for insurance. Both of these products can save tax

The post ULIP is not ideal for financial planning appeared first on The Gulf Indians.

K. Aravind

Parents are not likely to quarrel with their children if they go to the shop and buy sweets for the remaining Re.1. The value of a rupee is so small. But the situation in the financial markets is a little different. You can even buy an insurance policy for Re.1.

Two years ago, the Indian Railway Catering and Tourism Corporation (IRCTC) introduced an insurance cover for passengers for 49 paise. The policy can be taken only if the traveller is interested. Along with booking tickets, you also get the opportunity to take out insurance coverage. All you have to do is pay 98 paise for policy coverage when booking a ticket for a two-person trip. After taking out the insurance coverage, the customer will be informed about the details of the policy via e-mail. Then there is a link to the nominee’s link to the insurance company’s website.

The insurance coverage is for death, permanent illness, or hospitalisation. In case of death, the coverage is up to Rs.10 lakhs. Complete physical disability is also covered up to Rs.10 lakhs. In case of admission to the hospital, the coverage is up to Rs.2 lakhs. Up to Rs 10,000 can be obtained for transporting the mortal remains in case of death.

The premium for the life insurance scheme Pradhan Mantri Suraksha Bhima Yojana is a rupee. A premium of Rs. 12 per annum is charged from the bank account. Up to Rs. 2 lakhs: Amount available in case of death of the policyholder. In case of irreversible loss of eyes, legs or hands, up to Rs. 1 lakh will be available.

It is sufficient to pay a premium of only one rupee, but this is inadequate for comprehensive insurance coverage. Life insurance coverage of Rs. 2 lakhs is not sufficient as life insurance coverage is required even if it is ten times the annual income of an individual. The Pradhan Mantri Suraksha Bhima Yojana does not replace comprehensive personal accident insurance coverage.

The Indian Railway Catering and Tourism Corporation had earlier included the cost of insurance in the ticket. Recently, insurance premiums have been levied on customers.

The coverage available in the event of death of a passenger under this scheme is Rs. 2 lakhs, which is inadequate. Life insurance coverage is required for at least ten times the annual income of a policy holder. Therefore, it is advisable to take out a term policy, health insurance policy and personal accident policy on your own. It is more important for us to get the coverage we need than to reduce the premium.

The post Do Re.1 insurance policies provide adequate protection? appeared first on The Gulf Indians.

Diseases come to us without any warning. Therefore, it is necessary to be financially prepared to deal with the situation of becoming ill. Most people rely on their or their spouse’s group medical insurance coverage. Another group is those who take out their own insurance policy. Is taking out that health insurance policy the only way to deal with an unexpected hospital stay? What about those who do not qualify for a health insurance?

The cost of a health insurance policy is a premium paid annually. The insurance company bears the full or partial cost of hospitalisation due to illness. At the same time, the insurance company does not provide coverage for certain diseases. Illnesses that were present at the time of taking out the policy will be covered only after a certain period of time.

Personal health insurance claims for people between the ages of 25 45 are generally very low. During this period, most people will be using the group insurance and coverage of the company they work for.

Given this fact, would it be appropriate to raise money for hospital expenses on your own? When a group of 25-year-olds have group insurance coverage, they can find money for emergency medical needs through a planned deposit instead of taking out another individual health insurance policy. For this you can invest in mutual funds through SIP (Systematic Investment Plan).

If you invest Rs 3,000 every month through SIP in mutual funds, in the long run you will have a large fund. For example, if the return on mutual funds is 12 per cent per annum, a person who invests Rs.3,000 per month can raise Rs.7 lakh in ten years. If a similar return is received within 20 years, the investment value will increase to Rs.30 lakhs. For example, if you start investing at the age of 25, you will get Rs.30 lakh by the age of 45. It can be used for any purpose, including medical expenses.

Similarly, insurance policyholders should consider a separate fund as they are not covered for existing ailments. If the insurance company does not approve the policy for any of the existing ailments, you will have to find yourself a special fund for medical treatment needs. You can also rely on SIP for this.

The post Is insurance enough to cover treatment expenses? appeared first on The Gulf Indians.

“Life coverage of Rs.1 crore for just Rs.490 a month’ – is the motto of a life insurance company. Such advertisements, which offer life coverage of Rs.1 crore, regularly appear in the media. Life coverage of Rs.1 crore per month for a small amount of money is definitely attractive. But is a crore rupees worth of life coverage enough for everyone?

Do not limit life insurance coverage to less than Rs.1 crore. The amount of life coverage an individual needs is determined on the basis of various criteria.

The life coverage must be determined based on how much money is required for the dependents to sustain their standard of living in the event of the death of the policyholder. Therefore, life insurance coverage should be at least 15 times the annual income of the policyholder. For example, if you have an annual income of Rs.10 lakh, the required insurance cover is Rs.1.5 crore.

This is one method. Another way is to determine life coverage for your family based on future expenses and current investment.

According to the second method, the income that a person can earn during his working life is calculated first. Subtracting the existing life insurance coverage, savings and other investments from this, you can calculate the required life insurance coverage amount.

For example, suppose the current annual expenditure of a 30-year-old person is Rs.3 lakhs. If he intends to retire at the age of 60, he can be expected to work for another 30 years. If the cost of living for 30 years is multiplied by Rs.3 lakhs, it can be considered as Rs.90 lakhs.

Add to this the balance of the mortgage and the cost of educating the children. Assuming these two expenses are Rs.50 lakh each, the total requirement is Rs.1.90 crore.

Exempt current life insurance coverage and other savings from this. Suppose you currently have life insurance coverage of Rs.20 lakh and savings of the same amount. Then the required life insurance coverage can be estimated at Rs 1.50 crore (Rs1.90-0.40 = 1.50).

It is clear from this example that insurance alone is not enough to ensure life coverage of just Rs1. crore. Therefore, care should be taken to determine the required life coverage before taking out a term policy.

The post Is insurance cover of Rs.1 crore enough? appeared first on The Gulf Indians.

Those who take out a traditional endowment policy in the hope of a higher return will be disappointed. Money made through hard work without understanding the terms and conditions of the policy and trusting only the words of the agents will not get the required protection or return if invested in such products.

It is a fact that consumers are deceived by agents when selling products that combine investment and insurance, including endowment policies. Consumers should try to buy the policy only after learning about the policy without falling prey to the baseless temptations of agents about the benefits of the policy. Such policies should be avoided, recognising that insurance is not for investment.

Insurance agents are particularly interested in selling endowment policies because the commission is so high. The commission on sale of an endowment policy is 25 per cent of the first year premium. The agent receives a commission of 7.5 per cent of the premium for two and three years and 5 per cent of the premium from the fourth year. It is only natural that insurance agents would try to maximise sales by targeting this huge commission. Therefore, they do not have to disclose many things to look out for when buying an insurance policy.

Most endowment policies state the sum assured. This amount is received after the policy term. But some policies do not say so. It is too late when those who have taken such policies realise that the amount of death benefit will be received even after the completion of the policy term.

The basic premise is not to confuse insurance with investment. Life Insurance provides for the long-term protection of the family’s financial status in the event of an untimely death of the family’s source of income. This goal is fully achieved through term policies aimed at higher insurance coverage. These are also known as protection policies. Term policies with the sole purpose of life insurance are available at a relatively low premium compared to the sum insured. At the same time endowment policies have to pay a very high premium to get this much coverage.

In addition to taking out a term policy for life insurance, you should opt for mutual funds, PPFs and schemes like the Senior Citizen Savings Scheme for investment.

The post Investing in endowment policies can be frustrating appeared first on The Gulf Indians.

India has the highest number of diabetics and heart patients in the world. It is not easy to get a health insurance policy for people with lifestyle diseases. Although group insurance covers people with such ailments, it is difficult to take out an individual policy after being exposed to lifestyle diseases.

Even those undergoing angiography or heart disease prevention treatments are considered heart disease by those health insurance companies. Such persons are denied policy coverage. Even if the policy allows, you will have to pay a higher premium.

At the same time, do not assume that you will not be covered by insurance because of lifestyle diseases. Insurance companies decide whether to allow coverage for lifestyle diseases such as heart disease, depending on the circumstances. If the disease is under control as per the standards of the insurance company, the coverage will be available under the normal policies.
Coverage for diabetes is also available if the blood sugar level is within certain limits. For example, if the average HBA1C score of a person’s blood sugar level for the last two or three months is less than six-seven, coverage will be allowed without any increase in premium.

The criteria for covering patients with such illnesses may vary depending on the health insurance company. So do not hesitate to approach another health insurance company just because you have been denied a policy.

The premium may vary depending on the nature of the coverage the customer receives. For example, if the coverage starts immediately after taking out the policy, the premium will be higher. At the same time, if the coverage starts after a certain period, the increase in premium can be avoided. There are multiple lifestyle diseases but the premium will be higher.

There are policies that provide special coverage for diabetes. Deciding whether to take out such policies or general health insurance policies is based on your health status, the cost of health insurance and the number of people who need coverage. Patients with moderate diabetes may need to take out a regular health insurance policy but have 50 per cent more coverage than a healthy person. People with serious illnesses may want to take out a special coverage policy for diabetes. If you have to stay in hospital during the waiting period of the policy, you will have to pay for the treatment yourself.

The post Insurance coverage for those suffering from lifestyle diseases appeared first on The Gulf Indians.