South African based insurer Sanlam to buy 26 per cent in Shriram Capital

South African-based insuring company Sanlam Ltd. is all set to purchase 26% in Shriram Group’s Shriram Capital Ltd (SCL). The deal is estimated to be around Rs. 2,000 crore.

As per industry sources, about Rs. 1,200 crore will be in the cash form, and the remaining amount will be in the form of investment in the insurance business.

Shriram Group and Sanlam Ltd. went into partnership five years back to set up Shriram Life Insurance Company Ltd. As per IRDA regulations, 26% stake was acquired by Sanlam. The group also launched a non-life insurance company, Shriram General Insurance Ltd in which Sanlam again has 26% stake.

The SCL is planning to expand the insurance business with this investment and will also be utilized for expanding other finance businesses.

Federal Bank launches unique insurance scheme for its NRI customers

Federal Bank has brought a distinct insurance product for its new NRI customers by the name of “Fed Oriental Pravasi Insurance”, in association with Oriental Insurance Company. 

The insurance scheme is customized to primarily cover hospitalization expenses of NRI customers. It provides cash-less treatment facility at more than 3000 hospitals all across India and covers unexpected contingencies like accidents and repatriation. 

The scheme is applicable to all new NRI customers having a minimum balance of Rs. 5000 in their account. Medical cover of Rs. 10 lakh is available for whole family in the event of death or disability of the insured person. The policy also provides an economy class airfare for a dependent in case of an accident or airlifting along with the patient. 

Treatment abroad in accredited hospitals for an amount up to Rs. 75000 per year is also covered under the scheme.

Federal Bank is listed on BSE, London Stock Exchange and NSE. It is one of the leading private sector banks in India. It is the 4th largest bank in India in terms of capital base.

Public–private partnership model only way for a secured pension

World’s second largest reinsurer Swiss Re has indicated that for creating a long-term retirement provision, both private and public bodies have to work together to address the broader issue of a sustainable pension infrastructure. 

India is making efforts to set up a detailed social security plan by permitting new players in the pension and insurance field. Increase in life expectancy in India in recent times has caused difficulties in funding for insurers. 

Swiss Re report said that advanced models furnish improved figures of future longevity and will bring in vital changes in the overall result, which ought to be driven by private and public bodies working in concert. Insurers and employers ought to work unitedly to attain a lasting sustainable infrastructure.

LIC to offer up to six per cent annual return on Pension Plus

Life Insurance Corporation of India is ready to offer 6% annual return on its unit-linked pension product “Pension Plus”.

The unit-linked pension product-‘Pension Plus’ is thus far the only regular premium unit-linked pension plan based on IRDA guidelines prescribing to a minimum guaranteed return of 4.5%.

This move arrives at a time when the IRDA has been pushed to draw back the disputable 4.5% guaranteed return section following opposition from private life insuring companies, who indicated that such returns were not viable.

Furthermore, LIC is likely to continue with the existing scheme, even if the pension rules are revised in the coming months. The product ‘Pension Plus’ was launched in September 2010, and collected a premium of approximately Rs. 400 crore.

IRDA is now planning to drop the ‘guaranteed return clause’ in pension product norms, as private life insuring companies are refusing to launch any pension products.