Money Back Health Insurance Plan.by IndiaFirst Life Insurance

IndiaFirst Life Insurance, a joint venture between Bank of Baroda and Andhra Bank along with UK's Legal & General, has announced its foray into the health insurance market with the launch of IndiaFirst Money Back Health Insurance Plan. 

A substantial part of the premium you pay is actually credited into your policy account and this money is invested in various funds as per your choice to get you optimum returns.

This money accumulates in your account and comes back to you at the end of the policy. What's more, you can also use this amount anytime if you need to cover hospital expenses that are beyond the insurance limits or not payable under this policy.

The plan is a long term plan for 5 or 10 years and offers dual tax benefit of Section 80C and 80D, under the current tax laws.

It offers the convenience of cashless treatment, cover for 195-day care procedures, re-imbursement of medical expenses for 30 days pre and 60 days post hospitalization, cover for the entire family (spouse, two children and two dependent parents) under one plan.

It is an indemnity-based plan - the insurer will reimburse the expenses incurred on hospitalization, subject to the sublimit and other conditions. You can choose between five fund options.

FEATURES: It is available as individual and family floater plans. The floater plan covers the policyholder, spouse, two children and two parents.

The policyholder will be the 'primary life assured', and others will be referred to as 'other life assured'. Upon the death of the 'primary life assured', the benefits are paid out and the policy ceases to exist.

The policyholder can nominate a beneficiary to receive the sum assured in case of his/her death. The maximum entry age is 60 years and a policyholder cannot be over 70 at the end of the tenure. The maximum ages of parents at inception and maturity should be 65 years and 75 years, respectively. 

SUM ASSURED: The minimum cover offered is Rs 1.5 lakh, and Rs 5 lakh is the upper limit. Under the floater option, the maximum sum assured is Rs 10 lakh.

TERMS OF COVERAGE: The maximum cover is restricted to five times the annual sum assured. There are sub-limits for doctor's fee, room rent, ICU charges, etc. On maturity, you will get the fund value, either as lump sum or in installments, as per your choice.

PREMIUM AND PAYMENT TERMS: You can choose either the single-premium -with tenure of five years – or the regular premium option, with a 10-year term. The premium will be reviewed annually.

Till the age of 45, the minimum premium under the regular mode is Rs 10,000, while it is Rs 30,000 for single premium mode. If you are over 46, the minimum premium will be Rs 14,200 in the regular mode and Rs 37,500 in the single premium mode.

CHARGES: Premium allocation charges are 13% in the first year and 2% in the subsequent years under the regular premium mode.

UPSIDE: Those unwilling to treat their yearly health premium solely as expense and prefer to create a fund instead may find the plan appealing.

DOWNSIDE: The plan is costlier than pure health policies, due to Ulip charges. In addition, the policy gets terminated upon the life assured's death, leaving the dependents unprotected.

Note- This blog (www.yoursweetmoney.blogspot.com) must not hold responsible for any information shared in this article as all the information has gather through online.

You are hereby requested to consult with your financial planner prior to investment.

Honda Jazz

Honda Siel Cars India today launched a variant of the premium hatchback Jazz.

The move precedes the introduction of the small car Brio, which will feature the same engine as the new Jazz.

The car is priced in the range of Rs 5.50 lakh to Rs 6.06 lakh (ex-showroom Delhi). The old Jazz was priced between Rs 7.12 lakh and Rs 7.56 lakh. The new variant will be fitted with a 1.2-litre petrol engine and give a mileage of 16.7 km per liter.

The engine is being manufactured at a facility in Greater Noida.

As per Mr. Jnaneswar Sen. Honda Siel senior vice-president (sales and marketing), “The engine capacity at the plant is around 1 lakh units per annum and the utilization level is about 60 per cent. So, there is enough capacity to produce engines for the Jazz and Brio”.

He also said some of the components would be brought from the Tapukara plant in Rajasthan. The localisation level of components in the new car stands at about 76 per cent.

DLF stares at Rs 900cr more penalty

Real estate giant DLF may have to pay Rs 900 crore extra penalty if the Competition Commission of India (CCI) finds it guilty of abusing its dominant market position in three more projects in Gurgaon.

The CCI stunned the housing market on Tuesday when it slapped a Rs 630-crore fine on DLF for unfair practices at its Belaire project in Gurgaon. 

The competition regulator is now investigating charges of market dominance and anti-competitive practices in the Park Place, Magnolias and New Town Heights projects.

Officials said apart from DLF, the commission was also investigating 10 to 11 cases involving other real estate players where complaints under sections 3 and 4 of the Competition Act 2002 had been lodged. Sections 3 and 4 deal with anti-competitive agreements and abuse of dominant position, respectively.

Sources said next in CCI’s line of fire were cement companies such as Ultratech, ACC and Ambuja Cement, who might have misused dominant market positions.

“Complaints have come from buyers of residential properties in Park Place, Magnolias and New Town Heights against DLF. We will issue an order soon,” said commission officials.

The commission can charge a penalty of up to 10 per cent of three-year average turnover of a company in each case of abuse of market dominance and anti-competitive practices. DLF posted an average turnover of Rs 9,006 crore between 2009 and 2011. In Belaire, the fine was 7 per cent of the average turnover.

The CCI will also initiate “suo-motu” investigation into other real estate players, including Lavasa and DB Realty, as anti-competitive practices have become a norm in the real estate sector.

“Buyers in general are facing problems such as escalation of property price, change in build-up area and delay in getting possession. 

It is, therefore, appropriate to look into the general practice along with specific complaints,” said officials.

The commission, which was set up two years back, is currently investigating around 140 cases.

The commission feels a real estate regulator will “ensure the amount collected from customers is utilised for the specific project, bring transparency in information relating to work progress and end the practice of built-in hidden costs other than the initial set price”.

Analysts said in the absence of a market regulator the commission should be careful during its investigation. “The commission should see to it that it does not become a tool in the hands of irate consumers. 

It should be circumspect when dealing with complaints,” said Abhishek Goenka, partner (real estate) at BMR Advisors.

A Real Estate Regulation Bill 2011, which will bring transparency in the sector and protect consumers from fraud, is yet to be introduced in Parliament. 

If the bill becomes law, all developers will have to register with the regulator and provide details of their projects before starting promotional activities.

Courtesy- http://www.telegraphindia.com/1110819/jsp/business/story_14396014.jsp

ICICI loan

 Bringing back memories of the much-reviled teaser rate home loans, ICICI Bank today launched two home loan products, which give borrowers the option of a fixed interest rate for the first two years.

However, it is not a teaser rate loan in the strictest sense as it does not front-load a lowball rate as an inducement to unsuspecting home loan borrowers.

Under the one-year fixed rate home loan, the customer can take a loan at 10.50 per cent for an amount less than or equal to Rs 25 lakh, 11 per cent for higher than Rs 25 lakh and less than or equal to Rs 75 lakh, and 11.50 per cent for above Rs 75 lakh.

Under the two-year fixed rate scheme, the customer can take a loan at 10.75 per cent for an amount less than or equal to Rs 25 lakh, 11.25 per cent for above Rs 25 lakh and less than or equal to Rs 75 lakh, and 11.75 per cent for an amount higher than Rs 75 lakh.

On completion of fixed rate period, loans will take on a floating interest that will be linked to the base rate.

Borrowers will also have to pay a margin above the base rate, which will be decided at the time of loan sanctioning.

The new products will be available from Friday, ICICI Bank said, adding that the fixed interest products are in addition to the already available floating products.

The notorious teaser rate loan was the brainchild of the State Bank of India and its former chairman P. Bhatt. It was launched in 2009 with a fixed interest rate component that was as low as 8 per cent for the first year. It morphed into a floating rate for the remaining term of the loan.

However, the RBI came down on these schemes as it was concerned that borrowers might find it difficult to service the loans once the normal rate kicked in.

With interest rates turning expensive and observers fearing a couple of more rate hikes from the apex bank, ICICI Bank’s latest move seems designed to carve out a greater market share and acquire customers.

The lender said that fixed income rates would shield customers from frequent changes in home loan interest rates and protect them from any rise in interest rates over the next one or two years.

Coal India snatches RIL crown

Barely nine months after it listed on the stock exchanges, has state-owned Coal India had mid-wived one of the most incredible stories on Dalal Street by toppling Reliance Industries from its perch and becoming the country’s most valuable company. The Calcutta-based hewer of coal today notched up a market capitalisation of Rs 2,51,296 crore, nudging ahead of Mukesh Ambani’s flagship company which reported a value of Rs 2,47,129 crore. The Coal India stock, which first listed on the bourses on November 4 last year, has risen 16.21 per cent till date, while Reliance has wilted 32 per cent during the same period. Both are principally energy resource companies: one is the largest producer of coal, while the other is the biggest refiner of crude oil. Coal India’s push to the top came in just seven trading sessions since it burst into the sensex on August 8. That itself is a fairytale ride: no other company has leapt into the index in a short span of nine months since listing. The change at the top, though not unexpected, is a reflection of the huge demand for natural resources such as coal in an economy that is projected to grow at 8 per cent. The fortunes of the two companies — Coal India and RIL — seem to have diverged because of perceptions of investors in a market that has been extremely volatile lately. RIL has been under-performing the markets over several months primarily because of disappointment over the company’s inability to ramp up gas output at its famed KG-D6 block. Revenues from its oil and gas exploration account for just 5.7 per cent of its gross turnover of Rs 276,371 crore in 2010-11, but that does not seem to have weighed with investors at all. In the trading today, the Coal India stock closed with a gain of 2.64 per cent at Rs 397.85, translating into a market capitalisation of Rs 2,51,296 crore. On the other hand, the RIL share ended lower by Rs 4.20 at Rs 754.80. For RIL, the change in the pecking order is tinged with a little bit of irony: it had emerged as India’s most valuable company nearly four years ago after dislodging another state-owned giant — ONGC. It has now been beaten by a nine-month old PSU newbie on the market. The RIL stock has also been pounded after a draft report of the CAG said the company had been shown undue favours by the Union ministry of petroleum and natural gas and the Directorate General of Hydrocarbons (DGH) in its Krishna-Godavari (KG) block. Experts point out that there are many things that are going in favour of Coal India, which is the largest coal producer in the world. The availability of huge reserves in India will see many coal-based power projects coming up. Moreover, after the Fukushima nuclear power disaster in Japan, concerns over safety are likely to result in a slowdown of future nuclear projects.  Coal India has huge cash reserves and will not be affected by the current environment of high interest rates or the economic uncertainty overseas.

Beetle variant .......... next year

 Volkswagen India will bring the third generation Beetle to India next year.

The car, first introduced in 1938, has dropped the “New” tag from its name and will now be called the 2012 Beetle.

The third generation bug was unveiled at the Shanghai Motor Show.

The car has recently been launched in the US and is expected to hit the Asian markets in February 2012.

Volkswagen India has, so far, sold 617 units of the New Beetle that was introduced in India in December 2009. While the company sold 58 units of the “People’s Car” in 2009, sales rose to 466 units in 2010.

This year, the German carmaker sold 93 units of the car till July.

The Beetle, with a price tag of Rs 21.22 lakh, has been introduced in India for its iconic status and for brand positioning and not for volumes. Still, we have not done too badly having sold over 600 units in over one-and-half years.

The new generation Beetle has hit the US markets. It will be introduced in Europe later this year. We hope to bring it to India next year. The car continues to be manufactured at our Mexican plant and will be sold here as CBUs.

Plan your investment in the next one year

It seems that returns from equities is a distance dream however gold and silver are at record highs and inflation is eating into fixed-income returns; now maybe as good a time as any to rethink your asset allocation.

While overall asset allocation should be a function of age and financial goals, equities are expected to emerge as outperformers over the next 12 months, according to experts.

Locking in returns at high interest rates would help get reasonably decent returns in the fixed income space, while gold is being advised as a hedge rather than a major component of a portfolio.

The stock market has outperformed after a year of underperformance in recent times. This trend is expected to repeat itself with a bounce back in the next year.

 A correction in oil prices is good for the Indian economy and one could expect significant returns in equities over the next 12 months.

The Sensex, an index whose movements represent the state of the markets for the Bombay Stock Exchange, was up 81.03% in 2009 after falling 52.45% in 2008.

It has fallen 3778.15 points, or 18.42%, since January this year.

Goldman Sachs put out a report on August 8 with a one-year target of 6600 on the Nifty, the benchmark for the National Stock Exchange. 

This implies a 28.76% upside from Tuesday’s closing level of 5125.75 on the Nifty or 16730.94 on the Sensex.

On the fixed-income side, experts said a peaking of interest rates bodes well for locking in returns in fixed deposits or investing in debt mutual funds.

Under the present circumstances it is advisable to invest in debt mutual funds as against fixed deposits as they are more tax-efficient.

Also, dynamic bond funds could be expected to do well over the next one year as they are best placed to take advantage of the change in interest rate cycle.

Investing in a fixed deposit one year ago would have given you a return of 7.25%, today it gives 9.25% before tax.

Debt mutual fund returns could give higher, with some experts predicting double-digit returns of 10%-13% over the next one year.

Gold and other precious metals have had a great run over the last one year.

The yellow metal returned 40.13%, while silver has more than doubled (102.44%).

Analysts do not expect the same stellar performance now, unless there is a repeat of the global uncertainty that resulted in people fleeing to the safe haven.

Precious metals would be better off as a hedge than a major part of one’s portfolio, experts said.

Precious metals could be expected to give returns of 2-3% over the prevailing inflation rate. One should allocate 10-12% of investible money to the category.

On Tuesday, gold was trading at Rs26,155 per 10 grams and silver at Rs60,145 per kilo, according to data from the Bombay Bullion Association.

Cash with investors at a 30-month high

Cash holdings with global investors touched their highest levels in the last two-and-a-half years following a drastic fall in risk appetite on fears of recession and slowdown in corporate earnings.

A global fund manager survey carried out by Bank of America Merrill Lynch last week suggests cash balances rose to 5.2% — the highest since March 2009 and just a tad below extreme levels seen during previous downturn in December 2008.

Even so, investors remain bullish on emerging market (EM) equities.

Despite the shift away from risk, EM allocations remain remarkably stable and EM has become the single overweight region for global investors.

A net 27% are overweight EM, down slightly from 33% last month. The improving outlook on China can partly explain stable EM allocations.

Among the sectors preferred, EM investors continue to like consumer-oriented sectors with consumerdiscretionary and staple the biggest overweight. 

The cyclical sectors like energy and materials are big underweight.

The income effect and demographics effect along with less impact of slowdown on these stocks works in favour of consumer staples and consumer discretionary sectors like FMCG, pharma and two wheeler automotives.

According to survey, the most favoured markets among EM investors are Indonesia, Russia, China and South Africa (+13).

India remains among the least favoured despite the correction. For India, inflation has been a concern and there may be slowdown in earnings in the near term as well.

However as and when commodity prices come down, we would see inflation cooling off and pause in monetary policy tightening. One needs to keep an eye on oil prices.

Lokpal Bill

The Lokpal will be a three-member body with a chairperson who is or was a chief justice or Supreme Court judge, and two members who are or have been high courts judges or chief justices.

Implementation of the Lokpal bill will hopefully reduce corruption in India.
The basic idea of the Lokpal is borrowed from the office of the ombudsman in other countries.

It provides for filing complaints of corruption against the prime minister, other ministers and members of parliament with the ombudsman.

Anyone, except for a public servant, can file a complaint and the Lokpal has to complete the inquiry within six months.For 42 years, governments have tried to put in place the law.

The bill was for the first time presented during the fourth Lok Sabha in 1968, and was passed there in 1969. However, the Lok Sabha was dissolved, resulting in the first death of the bill.It was revived in 1971, 1977, 1985, 1989, 1996, 1998, 2001, 2005 and 2008.

In September 2004, Prime Minister Manmohan Singh said the Congress-led United Progressive Alliance government would lose no time in enacting the bill. Nevertheless, strong lobbies blocked it.

The bill's supporters consider existing laws too weak and insufficiently enforced to stop corruption

Key features of proposed bill

1.     To establish a central government anti-corruption institution called Lokpal, supported by Lokayukta at the state level.

2.     As in the case of the Supreme Court and Cabinet Secretariat, the Lokpal will be supervised by the Cabinet Secretary and the Election Commission. As a result, it will be completely independent of the government and free from ministerial influence in its investigations.

3.     Members will be appointed by judges, Indian Administrative Service officers with a clean record, private citizens and constitutional authorities through a transparent and participatory process.

4.     A selection committee will invite shortlisted candidates for interviews, video recordings of which will thereafter be made public.

5.     Every month on its website, the Lokayukta will publish a list of cases dealt with, brief details of each, their outcome and any action taken or proposed. It will also publish lists of all cases received by the Lokayukta during the previous month, cases dealt with and those, which are pending.

6.     Investigations of each case must be completed in one year. Any resulting trials should be concluded in the following year, giving a total maximum process time of two years.

7.     Losses caused to the government by a corrupt individual will be recovered at the time of conviction.

8.     Government office work required by a citizen that is not completed within a prescribed time period will result in Lokpal imposing financial penalties on those responsible, which will then be given as compensation to the complainant.

9.     Complaints against any officer of Lokpal will be investigated and completed within a month and, if found to be substantive, will result in the officer being dismissed within two months.

10. The existing anti-corruption agencies (CVC, departmental vigilance and the anti-corruption branch of the CBI) will be merged into Lokpal , which will have complete power and authority to independently investigate and prosecute any officer, judge or politician.

11. Whistleblowers who alert the agency to potential corruption cases will also be provided with protection by it.

Inflation dip fails to mask worry

As per chief economic adviser Kaushik Basu inflation was expected to peak at 10 per cent in August but decline thereafter — which more or less ties in with the RBI’s forecast that it would stay around the current levels of just over 9 per cent at least till the end of the second quarter which ends on September 30.

Basu’s statement came after the CSO authorities announced that headline inflation had dipped to an eight-month low of 9.22 per cent in July as the rate of price rise in food articles and petro-products had eased though pressure remained on manufactured items.

In addition, overall inflation figure for May this year was revised upward to 9.56 per cent from the provisional estimate of 9.06 per cent.

However, finance minister Pranab Mukherjee said the inflationary pressures could ease because of the strong monsoon. He added that the government would take steps to cool inflation

The RBI has raised its key policy interest rate – the repo – 11 times since March last year to beat down on inflation.

Last month at its first quarter review of its monetary policy, the RBI said inflation would hover around current levels at least until the end of the second quarter, which ends on September 30. It expects inflation to go down to 7 per cent by the end of the fiscal on March 31 next year.

The central bank had raised its forecast for inflation by the end of the year by a full percentage point from its May forecast of 6 per cent.

In July, prices of food articles went up 8.19 per cent year-on-year, which is lower than the 8.38 per cent inflation recorded in June.

Inflation in overall primary articles, which have a share of over 20 per cent in the WPI basket, stood at 11.30 per cent in July, down from 12.22 per cent in June.

However, prices of manufactured products, which have a weight of around 65 per cent in the WPI basket, went up 7.49 per cent year-on-year in July.

Employment onus on India

India will need to generate at least 5.5 crore additional jobs by 2015 if it wants to maintain the current ratio of employed people to total population, a study done by Crisil Research said today.

The study, Employment in India — Uneven and Weak, said this number of 5.5 crore would be twice the number of jobs created during 2005-10 and that creating these jobs would pose a challenge without adequate policy support.

While the current ratio of employed people to the total population stands at 39 per cent, the number of 5.5 crore also comes after accounting for many people employed today either retiring or losing their jobs.

According to the study, despite higher economic growth in the second half of 2000s, the country has been unable to generate sufficient number of jobs in manufacturing and services. For instance, the GDP growth increased to 8.6 per cent during 2005-10 from 6 per cent during 2000-05, but the net addition to jobs remained almost flat at around 2.7 crore during these two periods.

“While net additions to jobs during the second half of the 2000 decade have been higher than the much-discussed two million numbers, this is clearly not enough to ensure inclusive growth,” it said.

Crisil said if the country wanted a solution in this regard, it should look at other countries, including China. The study noted large-scale labour-intensive manufacturing units are a rarity in India, since the real cost of employing labour is high.

Moreover, it is also virtually impossible for a manufacturing company with more than 100 employees to fire any employee even if it is facing bankruptcy. Therefore, demand for labour has not increased fast enough in manufacturing.

However, in the service sector, particularly in high-skilled services such as financial intermediation and business services, there is a shortage of skilled labour that is constraining job creation.

DLF penalty in Gurgaon apartment case

The Competition Commission of India (CCI) today slapped a Rs 630-crore penalty on real estate giant DLF for trampling on the rights of apartment allottees — the single-largest amount slapped by any regulatory watchdog in the country. DLF has been accused of ripping off those who bought into Belaire — a tony, high-rise condominium in Gurgaon. The company has been charged with unilaterally changing the scope of the project midway, raising money from clients without statutory approvals and denying customers the right to equitable compensation while slipping on delivery schedules. The commission, which formally started work only last year, upheld the charge that DLF had abused its position of dominance in the country’s real estate market by foisting provisions in the buyers’ agreement that were loaded against its clients. The commission chose an interesting way to decide on the penalty. It calculated the penalty at 7 per cent of the average turnover of DLF in the three preceding years. The average for the three years between end-March 2009 and 2011 was estimated at Rs 9,006.27 crore. Seven per cent of this sum came to Rs 630 crore. The CCI had imposed a penalty for similar abuse of market dominance on the National Stock Exchange a month ago. However, the penalty then was only Rs 5 crore. This is a hefty penalty and a strong statement from CCI. The Belaire project was floated in August 2006 and initially supposed to have five towers of 19 floors each with a provision for 368 residential units. The project, spread over 6.6 acres, was to have been completed in 36 months. The apartments — each costing well over Rs 2 crore — aren’t likely to be handed over before October this year. Without consulting the apartment allottees, DLF arbitrarily raised the number of floors at Belaire to 29 from 19, which inordinately delayed the project. The numbers of floors were raised by compressing the common area. The allottees were denied the right to claim any reduction in the price on that account. DLF also included in the buyers’ agreement Clause 32 that permitted it to “abrogate all that has been promised to the allottee”. This clause allowed DLF to amend or change annexure to the buyers’ agreement. The abuse of its dominant position in the real estate industry — an aspect covered by clause 4 of the Competition Act - became a nub of contention. DLF argued that there were many competitors in the market and it, therefore, could not be accused of abusing its dominance. The commission, however, used a variety of statistics and assertions that DLF itself had made in several documents, including its annual report, to establish that it straddled the totem pole in the real estate business. The DLF stock plunged almost 6 per cent to Rs 189 on the Bombay Stock Exchange yeterday.