Page 11 - Insurance Times September 2015 SAMPLE
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Insurance valuations an enigma: CII-Towers Watson Database to prevent in-
surance fraudulent claims
study It noted that insurers remain upbeat
about the sector's prospects and seek The Life Insurance Council, an apex
A joint study by the Confederation of growth momentum and value. industry body of life insurance com-
Indian Industry (CII) and Towers panies, is planning to put in place a
Watson has revealed that even though Sanjiv Bajaj, Chairman, CII centralized database of insurance
the upper limit of foreign National Committee on In- policies by December to detect and
direct investment (FDI) in surance and Pensions and prevent fraudulent claims.
insurance has been raised Managing Director, Bajaj
to 49 percent, the valua- Finserv, said the govern- "We are working
tion of insurance compa- ment has created a positive environ- on a fraud moni-
nies is still a novelty for investment ment for the sector to unlock value toring framework
analysts in India. through FDI. for the life insur-
ance sector. It is
According to the study, 'Indian Insurance Vivek Jalan, director (risk consulting) at expected to be
sector: In Pursuit of Value', the sector Towers Watson India, added how effec- ready by Decem-
faces challenges such as regulatory tively insurers are able to utilize the ber", said V. Manickam, secretary-
changes, growing competition, mis-sell- expected capital infusion from foreign general of the Life Insurance Coun-
ing and a prolonged economic slow- partners will decide the growth of the cil.
down, necessitating insurers to con- sector.
stantly reassess their business strategies. According to him, the council was in
the process of short-listing the
Aggressive bidding likely for Air India's $9 bn insurance vender who would offer the technol-
cover ogy to build and maintain a common
database where all 24 life insurance
Insurance companies are getting "Premium rates are softening in the companies can share their policy
ready to bid aggressively for Air India international market as there were no data. A meeting is scheduled to final-
$9 billion (around Rs.57,420 crore) major aircraft accidents barring Ger- ize the terms of reference.
cover, coming up for renewal on 1 man-wings. Also, there are more un-
October. State-run Air India, which derwriters flocking to the international As banks get benefits from Cibil, this
floated a global tender proposed fraud monitoring mecha-
for the policy to cover market. Therefore, we nism will help insurance companies
its 126 aircraft expects are expecting a rea- get details of customers and detect
to buy the policy at a sonable discount in the any fraud in disclosure and claims by
reasonable discount, premium", said the ex- policyholders. The database could
given the rise in the ecutive. also help the council to study claim
number of underwriters and its safety patterns.
record, said two Air India executives. Air India paid $24 mil-
lion last year for its policy from state The Life Insurance Council also plans
"Air India's (including its subsidiaries, run firm New India Assurance Co. Ltd, to approach the State Governments
affiliated companies and joint which offered it in partnership with to request waiver of stamp duty on
ventures (JVs)) aviation insurance poli- American International Group Inc. the Pradhan Mantri Jeevan Jyoti
cies are due for renewal effective Bima Yojana.
from October 1, 2015 for an agreed Insurance premiums had increased for
fleet value of around $9 billion. We both aviation insurance and reinsur- However, as insurance is a state sub-
invite technical bids in sealed enve- ance following the disappearance of a ject and they needs to be a discussed
lopes from Indian insurance companies Malaysia Airlines plane in March, 2014 with the State Governments. Of 24
duly registered with IRDAI (Insurance and the alleged shooting down of an- life insurance companies in the coun-
Regulatory and Development other aircraft of the same airline over try only 10 have joined the scheme
Authority of India)" the airline said in Ukraine. so far according to Manickam.
its global tender posted on its
website. On 24 March 2015, a German-wings
Airbus A320 crashed in the French Alps
while flying from Barcelona to
Dusseldorf.
The Insurance Times, September 2015 7
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