Making Blockchain Technology In Life Insurance Work For You

wealthymattersBack in April 2018, when I read the press release from Cognizant about having teamed up with a consortium of fifteen Indian life insurers and developed a blockchain solution to facilitate cross-company data-sharing to help these life insurers reduce their reliance on data intermediaries and aggregators in obtaining customer and policy details for a wide range of critical purposes, such as know-your-customer due diligence, financial and medical underwriting, risk assessment, fraud detection, and regulatory compliance, I was FURIOUS.


You see, I am a long-standing customer of 2 of these 15 life insurance companies. One of them was the company I made my very first purchase from all those years ago, on the recommendation of a banker I trusted. And at that time I had in all honesty made full disclosure of all the information they sought in their proposal forms and the additional queries their underwriters had. However, I made the disclosures for the limited purpose of purchasing specific policies from these companies. And at a time that block-chain was nowhere in anybody’s mind space. Read more of this post

Managing Your Health Insurance Premium Costs

wealthymattersA more equitable health insurance market is leading to a heavier burden on younger ,healthier policyholders.Many health insurance policyholders have seen their premiums go up 15-35% in this financial year, as insurance companies, including public sector firms, revise their premium rates.

The new health insurance regulations implemented by the IRDA in October last year,including the abolition of claim-based loading and the introduction of the lifelong renewability clause,are some of the main reasons why premiums have risen sharply.The first refers to the practice of increasing subsequent premiums for those who make claims. The lifelong renewability clause  is to ensure that older people with health issues  continue have access to health insurance.Apart from this, the new health insurance guidelines also allow insurance companies to raise premiums only when a policyholder moves to a new age band. Moving away from claim-based loading and mandating lifelong renewability means that younger people pay more. There is some cross-subsidisation otherwise it becomes impossible for senior citizens to afford health insurance.Most claims come in the age group above 60 years but companies cannot load premium beyond a point for this age group. Read more of this post

List Of Insurance Companies In India

wealthymatters.comToday there are a heck of a lot of Insurance companies in India and every few days some or other new product is launched and withdrawn.

Insurance agents are are paid by the companies they represent and have little motivation to study products from other companies and none to recommend any of them to you.

Theoretically, brokers who are deemed by law to work in the interests of the buyer,are meant to study products from multiple companies and impartially recommend the best for their client. But remember they are compensated by insurance companies on the basis of each product they sell.Additionally the commission is on a percentage basis and calculated on the size of the premium.So brokers too face a conflict of interest and have less incentive to sell cheaper products. Read more of this post

IC-33 Exam of the IRDA

wealthymattersInsurance products as an asset class have always attracted me.This is because I am always on the lookout for investments where the downside risk is nil or minimum and the upside gain is disproportionally higher i.e a sensible asymmetric risk return scenario.I wrote about such investments in this post:Link.

Now insurance products will never give you the returns you can get from businesses, but on the other hand,not all insurance products are such losers as many financial planners,mutual fund agents and stock brokers claim.As far as returns from retail investment products go,returns from good insurance products are at the upper end of the spectrum.

Insurance products have a mixture of financial calculations and legal implications,just like options writing, which makes them interesting.So you can use them creatively to build wealth without unduly increasing risk.And meanwhile you can enjoy free insurance covers.Nothing like free options to make a bargain minded person ecstatic! Read more of this post

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