LIC drive to for Growth push and recast policies

The LIC is planning to redesign 12 policies by the end of this year to comply with the revised life insurance guidelines laid down by the IRDA in February.

The country’s largest life insurer is facing the dual challenge of having an adequate number of policies that adhere to the revised guidelines and sufficient trained agents to sell them.

The Insurance Regulatory and Development Authority (IRDA) had initially set a deadline of September 30 to life insurers to come up with policies conforming to the new guidelines. The deadline was later extended to December 31.

The LIC had 50 saleable policies at the beginning of the year. Almost all of them need to be revised following the IRDA directive.

At present, the LIC’s Jeevan Arogya and Jeevan Akshay meet the new guidelines. The challenge that lies before the LIC is to retain the agents on the policy changes within a short time….. with new plans, new conditions… for all those things they have to spend a lot of time and money. The LIC has more than 1.4 lakh agents in the eastern zone, which serves 3.36 crore policyholders through various branches and satellite offices.

The LIC is also looking to strengthen alternative channels such as bancassurance, which involves the sale of policies through banks. Bhargava said the insurer had tied up with 19 banks, of which nine are PSU lenders and the rest gramin and state co-operative 

Sebi frown on WhatsApp

Dealing room activities of brokers, fund managers and other institutional investors have come under regulatory scanner for possible manipulations through use of Web-based social networking apps and messaging platforms such as WhatsApp and BlackBerry Messenger (BBM).

While the use of personal mobile phones are already prohibited inside dealing rooms — where trades are executed on behalf of clients — some brokers and fund managers have been found to be active on social networking and other Web-based groups and messaging platforms while placing orders, sources said.

This has brought to fore significant risks of insider trading, front running and other manipulative activities with regard to key client trade information being shared with outside investors or even among the dealers possibly working as a cartel, they added.

Brokers and fund managers are not allowed to use their personal mobile phones inside dealing rooms to receive orders from clients, while fund houses and brokerage firms are required to store records of all client calls for future inspections by the Securities and Exchange Board of India (Sebi).

Sebi is considering further tightening its norms with regard to dealing room communications, given the fast emergence of social networking and other Web-based messaging platforms. Those likely to be affected include entities dealing in stocks, derivatives and currency trading.

In a global probe into suspected rigging of forex rates, including those involving rupee as well, foreign regulators already suspect the use of intra-bank and Web-based messaging platforms among currency traders. Subsequently, many large global banks have already started clamping down on the use of such platforms inside their dealing rooms and similar action can be expected with regard to Indian markets as well.

The market watchdog is already mulling steps to check risks posed by the use of new-age smartphone messaging services such as BBM and WhatsApp by manipulators to spread sensitive information about their target stocks.

Messages through applications such as WhatsApp and BBM are difficult to monitor, given the multi-level difficulties faced in tracking the source and spread of market-sensitive information through these platforms.