Increase in term life insurance premium delayed by 10-15 days

 The increase in term life insurance premiums may be delayed by 10-15 days as re-insurer contracts await renewal and new product for a few insurers are yet to be approved, according to insurance brokers.

These premiums were earlier set to be increased from 1 April, but it has been deferred now and is now likely to be hiked later this month, as per industry source. These are premiums that life insurers pay to reinsurers for re-insuring their risk. According to the previous reports, premiums for term insurance were expected to rise by up to 20% in 2021 as insurers take into consideration the emerging mortality rates.

An industry source said, "Term insurance policies normally are pure risk cover which is payable only in case of the death of the life assured. Currently, in India, the term insurance policies are extremely economically priced given that the key influencing factor is the expected mortality risk on the portfolio or in simple words, the incidence of loss due to death."

Moreover, one should know that term insurance premium rates are determined by the insurance company based on the probability of death (mortality rate) at various ages among its customers. In western countries, this is done by insurance company's basis actual data whereas in India this is done basis the assumption of death rates.

So, this way, an insurance company normally works on a concept of creating a pool of fund through premiums, which is being paid by their policyholders. From this pool of funds, they settle the insurance claims of affected policyholders who die every year. This way, the concept of life insurance involves the group sharing of individual losses. And a large part of this pool is reinsured by the insurance companies. Hence, the renewal or renegotiating of re-insurer contracts impact the premiums.

Thus, looking at the current covid scenario, an adverse mortality experience over the past few years has intensified which has now led reinsurers to increase their rates resulting in an upward revision of term insurance premiums.

PROJECTS UNDER AEP TO STRENGTHEN RELATIONS

CULTURAL CONNECTION

 By cultural Connection, India will nourish this growing relationship with ASEAN.

 Buddhist and Hindu links could be deepening to flowering the bonds between peoples. India is also opening 10 ASEAN nations’ consulates in Guwahati, Assam. This would be a gateway to

North East to ease connectivity.

CONNECTIVITY

 Initiatives like building transport, highways, waterways encouraging airways are been taken to enhances connectivity between East countries with North East part of our country India. Budhi Gandaki dam- Nepal, myitsone dam- Myanmar are a part of increasing connectivity with ASEAN nations.

COMMERCE

 India invited ASEAN members to participate in the International Solar Alliance. International solar Alliance was coco-launchedn collaboration with France in COP 21 in Paris. A committee

“ASEAN INDIA TRADE NEGOTIATION” has been formulated to look into the “ASEAN-India Trade in Good Agreement. This committee is formulated with aim to make trade more strong with ASEAN members.

EAST ACT POLICY OF INDIA

Act East Policy is an upgrade policy to focus on strengthening and extending India’s friendly relationship in Asia Pacific region. Asia Pacific Region covers Indonesia, Malaysia, Japan, Vietnam,

ASEAN (Australia, Singapore and Association of Southeast Asian Nations), and the Republic of Korea, ASEAN Regional Forum (ARF) and East Asia Summit (EAS).

INTRODUCTION

 Under the leadership of India’s 15th Prime Minister Narendra Modi, Sushma Swaraj( Foreign Minister of India ) during her visit to Singapore purposed a new outlook “Act East Policy “ as look East policy is no longer working.

 At a very starting, Modi government made it clear that India would focus more on escalating relations with ASEAN and other East Asian countries. When United State got engaged in “pivot

to Asia “, this makes Modi Government smoothen India’s relation with East Asia neighbours foreign policy a priority.

OBJECTIVE

 Objective of Act East Policy is “to promote cultural and economic cooperation’s and strategies relation with Asia- Pacific regions countries “. This policy also focuses on India’s Northeast

region means state like Arunachal Pradesh connection with East countries. So in order to strengthen the connectivity between North East region of India and other Asia Pacific Region various bilateral and regional plans were implemented. These plans include Trades, Cultural activities, people with people contacts and physical infrastructures ( i.e. roads, airports, power, etc. )

SPECIAL DEPOSIT SCHEME (SDS)-1975 PAYMENT OF INTEREST FOR CALENDAR YEAR 2017

WHAT WAS THE NOTIFICATION?

The RBI has advised that interest for the calendar year 2017 may be disbursed to the SDS account holders through electronic mode or by way of account payee cheques on January 01, 2018 itself.

WHAT IS SPECIAL DEPOSIT SCHEME(SDS)?

 It was launched by the Central government on July 1, 1975. However, no fresh deposits were allowed under the scheme from March 1997.

 The purpose of the scheme was to provide better returns to non-government provident funds, superannuation and gratuity funds, surplus funds of the Life Insurance Corporation (LIC) and

Employees' State Insurance Corporation, etc.

 The organisations which invested in SDS were Employees' Provident Fund Organisation (EPFO), General Provident Fund (Central Services), Contributory Provident Fund (India), All India

Services Provident Fund, State Railway Provident Fund and General Provident Fund (Defence Services).

OVER-THE-COUNTER GOVERNMENT SECURITIES TRANSACTION BY FOREIGN PORTFOLIO INVESTORS (FPIS) – SETTLEMENT PERIOD

WHAT WAS THE NOTIFICATION?

 Earlier, Foreign Portfolio Investors (FPIs) are required to settle transactions in Government Securities in the Over-the-Counter-(OTC) market on a T+2 basis.

 It has now been decided to permit FPIs to settle OTC secondary market transactions in Government Securities either on T+1 or on T+2 basis. It may be ensured that all trades are  reported on the trade date itself.

WHAT IS T+1 AND T+2?

 Whenever you buy or sell a stock, bond, or mutual fund, there are two important dates of which you should always be aware: the transaction date and the settlement date.

 The abbreviations T+1, T+2, and T+3 refer to the settlement dates of security transactions which occur on a transaction date plus one day, plus two days, and plus three days, respectively. 'T' is the transaction date.

AUCTION OF GOVERNMENT SECURITIES: NON-COMPETITIVE BIDDING FACILITY TO RETAIL INVESTORS

WHAT WAS THE NOTIFICATION?

 As part of the overall strategy of diversifying the investor base for government securities, the Government of India and RBI have been taking various measures to encourage participation of

retail investors in G-Sec market including introduction of non-competitive bidding in primary auctions.