All Members NFIFWI

NFIFWI/89/2018-20                                                                                            Date-22-09-2019

All Members NFIFWI

Dear Comrades,

The new “IRDAI Product Regulations 2019” have many new changes which have to be complied by all the Insurance Companies. The major changes are Revival period (Extended from 2 to 5 years), surrender and paid-up value, Suicide clause, Commencement of Risk in minor lives, Change in Minimum / Maximum premium, Extension of premium table to higher/lower ages and/or to longer/shorter premium payment terms and policy terms etc. The above changes will impact the premium structure of the policies already in force. IRDA has laid down the following guidelines for all the insurance companies for modification/withdrawal of existing products and to comply with the new “IRDAI Product Regulations 2019”.

1.) All the insurers shall examine and ensure that all the existing products on sale are compliant with the new regulations. In respect of the existing products and riders which comply with the new regulations, a certificate duly signed by the Appointed Actuary and countersigned by the CEO/Chairman of the Insurer shall be submitted to IRDA.

2.) If the products and riders require modifications to conform to the new provisions, the insurers shall file the modified File and Use documents for modifications to the existing products and riders to comply with the new regulations.

3.) All the existing products and riders not in conformity with the IRDAI regulations shall be withdrawn on or before 30 November 2019.

L.I.C is also examining all the existing products and riders to comply as per the new regulations. The premium rates are being examined if the changes can be absorbed or needs to be modified. We understand that Jeevan Nidhi, Jeevan Rakshak etc may not be complying with the new regulations and may be required to be closed. Jeevan Anand and other policies may be reviewed and sent to IRDA for modifications to conform to the new provisions. The matter is still under review and will be decided shortly.

All the members are requested to wait for the official information from the management and not depend on the information in the social media.

There is a reporting in press that LIC has lost nearly Rs.57000 crores, which is absolutely fake, false, misleading and disingenuous. We strongly condemn such information. When due to slow down in the economy, we are witnessing Job losses in the entire country, LIC is the only institution which is recruiting. LIC this year, had already recruited 800 AAO’s, and given notification for recruitment of 8500 D.O’s and 8000 Assistants.

LIC has increased its market share till August 2019 and this may be the reason for the fake news being circulated to stall our growth and instill fear in the minds of field force and the policy holders. For the information of the members, LIC Investments are very safe and as per the guidelines of IRDA and LIC Act. The investments made by LIC (nearly 68%) in Infrastructure, Bonds, Securities, Loans to State Governments etc. are having sovereign guarantee i.e is guaranteed by the Government of India. As regards the investment made in the equity markets, LIC has made profits every year and there is no exaggeration to tell that there is no F.Y in which LIC has not made profits. LIC has made a net profit of Rs.23621 Crores during the year 2018-19 and during the current financial year LIC already made a profit of Rs.11000 Crores and may cross Rs.30000 Crores by the end of F.Y. LIC is not a short time investor in the equities and follows the principle of contrarian investing, which is the correct type of investing and even followed by the world famous investor, Warren Buffett. Contrarian investing is an investment strategy by purchasing and selling in contrast to the prevailing market sentiment of the time. LIC buys stocks at low price, when the share market falls and sells them when the market is high and the shares start performing well.

 

Kindly bring this to the notice of all your agents and policy holders. Let us work aggressively with renewed vigor and increase the market share of LIC.

 

With best regards,

Comradely yours,

(Vivek Singh)

Secretary General