Govt appoints former financial services secretary Debasish Panda as IRDAI chief

Govt appoints former financial services secretary Debasish Panda as IRDAI chief

THE GOVERNMENT ON Friday appointed former financial services secretary Debasish Panda as the chairman of the insurance regulator IRDAI for a period of three years. The post was lying vacant for close to 11 months since the departure of Subhash C. Khuntia.

Panda’s appointment comes at a time when the government has announced the initial public offering of the country’s largest insurer, state-run LIC, although it’s now on a wait-and-watch mode due to market turmoil in the wake of the Russia-Ukraine conflict.

Panda, a 1987-batch IAS officer of the Uttar Pradesh cadre, retired as the secretary of the department of financial services on January 31 this year. Previously, he had handled insurance as an additional secretary in the same department of the finance ministry.

The country’s insurance industry has 57 companies, including 24 life insurers and 34 non-life ones. Among the life insurers, LIC is the sole public-sector company. There are six public sector insurers in the non-life insurance segment.

According to some estimates, the overall market size of the insurance sector was about $280 billion in 2020. Setting the house in order, working towards its core mission of policy holder’s interest, speeding up the new company licensing process, and avoiding micromanagement are some of the important tasks for IRDAI’s incoming Chairman, as per a cross-section of industry officials.

source: www.financialexpress.com

This insurtech startup is simplifying health insurance for employees, making it affordable and accessible

This insurtech startup is simplifying health insurance for employees, making it affordable and accessible

Launched in May 2021, Mumbai-based HealthySure is an insurtech startup that targets SMEs and makes insurance and healthcare for employees affordable and accessible. The platform offers digitised policy and claim experience with curated health and wellness offering

The COVID-19 pandemic revealed that many Indian families were just a major health crisis away from financial ruin. According to a report released by the Reserve Bank of India (RBI) last year, household debt ballooned to 37.9 percent of the GDP in the October-December 2021 quarter, while bank deposits halved to Rs 1.7 lakh crore from Q2 FY2021. 

This was largely due to hospitalisation costs, which had gone through the roof for family members. Despite many working in organisations that covered their health insurance, they found themselves struggling to pay off bills as their cover was either inadequate or had certain restrictions

With organisations unable to provide a comprehensive health cover due to budget constraints, employees tend to opt for a separate personal cover – in essence paying double the premium, leaving them with potentially crippling debt in times of emergencies.

Enter HealthySure, which is enabling employees to have comprehensive life insurance cover by helping them upgrade their corporate health cover.

Providing comprehensive coverage

Started in May 2021 by chartered accountants, and IIM Bangalore and ISB alumni – Anuj Parekh and Sanil Basutkar, Mumbai-based HealthySure offers a unified health insurance product that lets employees to take a cover of as high as Rs 1 crore, with employers subsiding a sizeable portion (offer savings as high as 90 percent for the employee).

The way ahead

According to Insurance Regulatory and Development Authority, IBEF and Mordor Intelligence reports, the group health insurance market in India is projected to grow to $11 billion by 2025 – almost 1.5x the size of the retail health market.

Source – yourstory.com

Future Group to sell 25% in general insurance JV to Generali for Rs 1,253 crore; to exit insurance business

Debt-ridden Future Group will exit from the insurance business in a time-bound manner and plans to sell its 25 per cent equity in Future Generali India Insurance Company Ltd (FGIICL) to its JV partner Generali for a cash consideration of Rs 1,252.96 crore, as part of its asset monetisation plans to pare debts.

FGIICL is a joint venture between Future Enterprises Ltd (FEL) and Generali Participations Netherlands NV (Generali) and operates in the general insurance sector.

Besides, the Kishore Biyani-led group, is also exploring options for the sale of its stake in Future Generali India Life Insurance Company Ltd (FGILICL), another Joint Venture with General providing Life Insurance services.

“The company is exploring options for the sale of its remaining interests in FGILICL and FGIICL and it expects to complete the exit of its holding in the Insurance Joint Ventures in a time-bound manner,” FEL said in a regulatory filing.

The sale is to meet FEL’s commitment under the One-Time Restructuring (OTR) scheme for COVID-19-hit companies, which it had entered into last year with a consortium of banks and lenders

As part of that, the Future Group firm has to repay the loan through asset monetisation.

As part of OTR, FEL has to pay around Rs 2,200 crore by March-end this year.

Presently, FEL holds a 49.91 per cent stake in the general insurance firm FGIICL and after the deal with Generali, it will come down to 24.91 per cent

“Generali will become the controlling shareholder of FGIICL with an approx 74 per cent direct and indirect stake from its existing 49 per cent stake,” it said.

Besides, Generali would also have an option to buy out FEL’s remaining stake in FGIICL, said a late-night regulatory filing by the Future Group firm.

“FEL has agreed to sell a 25 per cent stake in its General Insurance Joint Venture, FGIICL, to its Joint Venture partner Generali for a cash consideration of Rs 1,252.96 crore, plus an additional consideration that is linked to the date of the closing of the transaction,” the regulatory filing said.

As part of the deal, Generali has also acquired an option to buy out FEL’s remaining interest in FGIICL, “directly or through a nominee”, at an agreed valuation, subject to applicable regulatory approvals, FEL said.

The transaction is subject to applicable regulatory approvals and other customary conditions,” it added.

According to the company, it had received offers from various potential buyers for its remaining 24.91 per cent interest in FGIICL.

In the Life Insurance JV, FGILICL, FEL currently holds 33.29 per cent stake, while Generali is a controlling shareholder with 49 per cent stake and the balance 16.6 per cent is with Industrial Investment Trust Limited (IITL).

“It (FEL) is also exploring options for the sale of its 33.3 per cent interest in the life insurance JV and expects to complete the exit of its holding in the insurance joint ventures in a time-bound manner to meet its commitment under OTR Plan implemented under an August 6, 2020 circular issued by the Reserve Bank of 

India in relation to the Resolution Framework for COVID-19 related stress,” it said.

Generali has received approval from the Competition Commission of India to purchase a 16 per cent stake held by Industrial Investment Trust Limited in FGILICL.

It has also agreed to invest up to Rs 330 crore in tranches in FGILICL to fund its growth plans.

Generali will become the controlling shareholder of FGILICL pursuant to the investment and its purchase of the 16 per cent stake held by Industrial Investment Trust Limited in the JV firm.

“Pursuant to these transactions, Generali will acquire a majority stake and control in both insurance joint ventures,” the Future Group said.

FEL develops, owns and leases the retail infrastructure for Future Group, which owns and operates retail chains such as Big Bazaar, Easyday and Heritage, among others.

n August 2020, the Kishore Biyani-led Future Group had announced a Rs 24,713-crore deal for the sale of its retail and wholesale business, and the logistics and warehousing business to Reliance Retail Ventures Limited, a subsidiary of Reliance Industries Limited.

As part of the deal, Future Enterprises is the transferee company to Reliance Retail.

Future Group’s 19 companies operating in retail, wholesale, logistics and warehousing assets would be consolidated into one entity — FEL — and then transferred to Reliance.

However, global e-commerce major Amazon is contesting the deal through its 49 per cent stake in Future Coupons Private Limited (FCPL), which is a shareholder in Future Retail Limited.

The matter is presently in dispute before the Supreme Court and the Singapore International Arbitration Centre (SIAC).

Auto dealers can act as sub-brokers for motor insurance: Irdai panel

Auto dealers can act as sub-brokers for motor insurance: Irdai panel

The committee to review the motor insurance service provider (MISP) guidelines on Wednesday suggested that automotive dealers can act as one of the distribution channels on a stand-alone basis, soliciting motor insurance business similar to insurance brokers.

MISP is an automobile dealer appointed by the insurer or the insurance intermediary to distribute or service motor insurance policies of automotive vehicles sold through it. The MISP guidelines were first issued by the Insurance Regulatory and Development Authority of India (Irdai) in August 2017 to bring orderly conduct in the matter of distribution of motor insurance business through motor dealers.

The committee noted that the motor insurance business sourced by MISPs through brokers and insurers constitutes around 25% of the total motor insurance business or around 11.25% of the overall general insurance business in India.

“In order to develop the MISP as another robust channel of distribution of motor insurance policies, the committee makes the following suggestions: automotive dealers as one of the distribution channel on stand-alone basis soliciting motor insurance business similar to insurance broker representing the customer with conditions such as i) mandatorily have agreements with all insurers; ii) prohibited from collecting premium; iii) provide access to customers to make a direct online payment to the insurer,” the committee said in its report.

“Alternatively, the automotive dealer may become a sub-broker or a sub-agent and work for a broker or a corporate agent, respectively,” it added.

On sponsorship of MISPs, the panel suggested that they can be sponsored by either an insurance intermediary or any one or more of the insurance companies at the same time.

“All insurance companies may be directed either to develop a portal or app or use the existing electronic or e-commerce platform through which insurance policies shall be issued. The electronic platform or portal shall have no functionality or mechanism built into it that can alter, modify or change the premium quoted by the insurance company,” the committee said

The panel has also suggested that the original equipment manufacturer (OEM) should be brought into the regulatory ambit by including OEM in the definition of MISP. “The OEMs shall be equal to MISP and will be subject to all the provisions of MISP Guidelines. They shall give the list of their authorized-dealers and authorized sub-dealers to Irdai and that list can be uploaded at IIB (Insurance Information Bureau) for generating unique identification numbers of the MISP,” the report said.

on premium payment, the committee said the amount must be done through a single check and the customer should make payment to the insurance company directly, which is facilitated by the MISP

Source-Livemint Date-21-01-2021

The Capacity Planning Trap

HR professionals are approached daily with multiple and varied requests, most of them presented as urgent. It’s a seemingly constant barrage from colleagues and senior managers. How do we prioritize the requests and deliver the best service possible? How do we marry the supply of HR resources to the business demand and ensure we are delivering value?

You know you have a problem when:

1. An initiative is launched without inter-department coordination
2. Key performance indicators have not been identified
3. There is no clearly defined goal
4. There is no committee charged with capacity calibration
5. Capacity calibration is not recognized as an organizational capability.

These issues are addressed by capacity planning, a management process that helps us determine if we have the sufficient resources to execute projects and requests.

Capacity planning is addressed in non-HR settings, and is one of the most necessary operational tools to run a business. It’s time to give thought to applying it to Human Resources. Given the continual move toward a service economy, the demand for talent solutions will only increase in the coming years.

Some companies lack the structure or desire to calibrate their project/initiative portfolio. HR often feels the downstream impact of capacity imbalance and is often left to manage multiple requests without regard to available capabilities or resources.

Without addressing the capacity restraints, HR can be overwhelmed by many projects and demands that exceed resource supply. Consequently, we are stretched so thin that it becomes difficult to focus on the most strategically aligned and valuable solutions. The irony here is that consistently exceeding capacity leads to less output, not more, resulting in productivity and quality problems. Working at an unsustainable pace can lead to “brain seizing” and burnout. This impedes delivery of high-quality solutions.

Causes of Organizational Capacity Overload

Capacity Blindness

Many organizations simply do not have a line of sight into all of the initiatives to which resources have been committed.

Isolation

Most departments set their priorities in isolation without understanding the impact on other departments or the draw on limited shared services. This myopic method of setting priorities results in drawing upon the same resources for support.

Cost Disequilibrium

Sometimes organizations cut people but do not recalibrate work or expectations. They want to reduce headcount with the goal of reducing expenses, but instead, induce employee burnout and turnover while reducing performance.

Pet Projects

Projects pushed by an executive that add no value whatsoever to the company can drain resources unnecessarily (monetary and human resources).

How to Manage Capacity?

In the absence of organizational capacity planning, HR can mobilize to address the excessive demands from the business. Recognizing the importance of capacity equilibrium is the first step to developing an operational model that is constantly rebalancing HR’s project portfolio. 

The model can include project/initiative prioritization at the highest level in the organization, agile project management, tracking tools to create and monitor the portfolio, initiative intake process, and the muscle to decline projects that are not necessary or valuable.

Agile Project Management

Prioritization is enhanced using the Agile method. I recently implemented capacity planning and Agile with a client. All new HR project/initiative requests go into to a backlog, which along with the business case, is reviewed during a biweekly sprint planning meeting. During the sprint meeting, the entire HR senior leadership team reviews the business cases and decides what will be added to the two-week sprint. Instead of competing for limited resources and embarking on misaligned projects, the entire HR Senior leadership team is rowing in the same direction.

Tracking Tools

Adopting tracking technology allows for a bird’s eye view into all requests in the backlog and in the active sprint. The technology also calculates demand to available supply and allows for better calibration decisions. My current client has adopted Jira as the tracking tool that includes all current and approved initiatives, their owners, and the time required to complete. Tracking tools can also measure the load across the enterprise.

To improve transparency, my client provided all HR staff with access to Jira so that at any level in the HR organization, the team is aware of all initiatives.

Project Intake

HR has traditionally taken on the role of order-taker. When the business has a problem that needs a people solution, it tells HR what it needs. However sometimes, the business does not clearly understand the problem it is trying to solve. This requires formal project intake, review, approval, and prioritization according to availability of resources.

The intake workflow for my current client includes an intake form intended to guide dialogue with the business customer. The intake form includes criteria such as:

1. What problem is this initiative/request meant to fix?
2. What are the facts that have brought your request to HR?
3. Who are the key stakeholders?
4. What is the time commitment and availability of the business and HR?
5. What is the scope of the request (e.g., one department or the whole company)?
6. Is this request aligned with organizational priorities?

Trade Offs and Saying “No”

Capacity planning must include decisions regarding trade-offs. This is often where capacity planning efforts fall short. Prioritization efforts can often be undermined if companies do not engage in decisions around what must stop or what must be rejected. Otherwise, we risk key contributors exiting the organization rather than experience burnout associated with long hours and overwhelming responsibilities.

No system is perfect. However, rigorous reviews and discipline on when and how Human Resources launches initiatives is a start. Having capacity equilibrium can improve creativity, mitigate employee burnout, and foster greater employee commitment to accomplish more in the most significant areas.

Source: HR Exchange Network

Date: 19^th January, 2021

Oaktree’s bid for DHFL’s insurance biz faces review

Oaktree’s bid for DHFL’s insurance biz faces review

Oaktree has proposed to hold DHFL’s stake in Pramerica Life Insurance through an India-incorporated alternative investment fund (AIF) to comply with FDI rules, which restrict foreign ownership in insurers to 49%

The insurance regulator may conduct a “fit and proper” test on the Indian fund used by US-based Oaktree Capital to hold a 51% stake in Dewan Housing Finance Corp. Ltd’s (DHFL’s) life insurance business if its offer to acquire the bankrupt home financier is accepted, two people directly aware of the development said.

Oaktree has proposed to hold DHFL’s stake in Pramerica Life Insurance through an India-incorporated alternative investment fund (AIF) to comply with foreign direct investment (FDI) rules, which restrict foreign ownership in insurers to 49%.

DHFL’s foreign partner, Pramerica Financial Inc., already owns the maximum permissible stake.

“Irdai wants the AIF to be ‘fit and proper’, which will include having a substantial capital base and a proven track record in running financial services businesses directly or indirectly,” one of the two people said, requesting anonymity. “Irdai is not in favour of granting an approval to any newly formed AIF with a small capital base created just for regulatory compliance.”

The committee of creditors (CoC) for DHFL, which is overseeing the sale of the mortgage lender, is currently in talks with top bidders Oaktree and Piramal Capital.

DHFL owes ₹87,000 crore to banks and bondholders, including State Bank of India, Life Insurance Corp. of India, Union Bank of India and many other foreign and domestic lenders.

However, the sale of the insurance business, where FDI rules apply, is a crucial part of the overall plan of the lenders to recover a part of their outstanding dues.

Irdai chairman Subhash Chandra Khuntia didn’t respond to a query sent on Saturday. A Hong Kong-based spokesperson for Oaktree declined to comment.

While Piramal has offered to buy out Pramerica Life Insurance for ₹1,000 crore, Oaktree’s bid suggests that it will rope in an AIF and will infuse ₹1,000 crore into the fund, which, in turn, will own DHFL Investments Ltd’s 51% stake in the insurance firm.

“While Oaktree’s proposal may be legally sound, Irdai is keen to evaluate whether it will be in the best interests of policyholders,” said the second person cited above.

“Initially, the lenders to DHFL were looking for a separate buyer for DHFL’s Pramerica unit. But so far neither has any insurer nor any corporate group shown any interest to buy DHFL Pramerica,” said the first person.

The second person said Oaktree is in talks with at least four AIFs for holding the DHFL Pramerica insurance business.

DHFL’s lenders are currently voting to select the winning bid. The decision to go with Oaktree or Piramal will be completed by 14 January.

On 28 December, Mint reported that Piramal raised its total offer commitment for DHFL to ₹38,250 crore, improving on Oaktree’s commitment of ₹36,400 crore.

Source- LiveMint

Date-05-01-2021

Tech trends in HR in 2021: Technology at workplace

While the pandemic devastated the economy, it also created an opportunity to propel advancements in the HR industry and forced organisations to redesign hiring and human resource management to suit the workplace of the future.

According to a survey by Gartner, 88% of business organisations all over the world mandated or encouraged their employees to work from home, and 97% of organisations immediately cancelled all work-related travel. The remote workplace became a reality almost overnight. This new normal transformed all activities of a typical office to the virtual medium. Beginning from virtual meetings to virtual hiring, everything is being supported by technology, which, in itself, is evolving at a rapid pace. However, virtual hiring comes with its own set of challenges. With no personal interviews, reading body language and facial expressions to assess a candidate becomes difficult even by experts. As applicants don’t always reveal everything in spoken words, these are an effective way of evaluating candidatures. Recruiters are on a lookout for a technology that could help read human emotions and predict behaviour.

Here are some technology trends in the HR industry that we saw in 2020 and will continue to rule in 2021:

—Virtual/remote workspace: Companies have had to equip their employees with software, remote working tools and networking tools. While existing tools like Microsoft Teams, Google Hangouts, Zoom and Skype for Business have worked well, we are going to witness newer innovation that will drive productivity and increase engagement. We will also see the use of Emotion AI in rating productivity of meetings using body language and facial expressions.

—Contactless hiring: Recruitment is a crucial part of every business process and the right quality of hires determine the performance of a team. With workplaces transcending to remote settings, hiring is also adopting newer technologies and platforms. While the beginning of the pandemic saw a lot of job losses, with the economy opening up, hiring activities have also ramped up. However, challenges remain in the absence of face-to-face interactions and deciphering behaviour based on a candidate’s expression and body language. While players like LinkedIn Jobs have developed video interviewing software, the emotional quotient or human element is still missing. This is where Emotion AI comes into play—it’s a dynamic tool that makes businesses reconsider their biases, methods and screening processes. Facial recognition, candidate assessments, eye tracking, brainwave mapping, video interviews and emotion tracking will soon find space in everyday recruitment. Remote interviews are here to stay, as these not only save commuting time, but are also significantly less expensive for both recruiters and candidates. Companies can now skip the long-drawn process of traditionally hiring people, conducting personality tests, and going through numerous CVs.

—Digital tracking: Employers are eager to track not only employee’s work, but also productivity quotient and how employees react to certain kind of work, announcements, changes, etc. While remote working is here to stay, employees are increasingly feeling lonely and productivity is getting hampered. Tracking software can help in getting work done collaboratively and bring out higher productivity ratio.

—Virtual reality: Face-to-face videoconferencing will be replaced by more immersive experiences with technologies like virtual reality and mixed reality. Working from home, assessing eligible candidates, onboarding of employees remotely, keeping employees engaged with company’s culture and removing biases in selection and appraisals will be all made possible using virtual reality.

Although these trends progressed in 2020, they are here to rule the workplace of 2021 and beyond. Adoption of technology will be accelerated as more employers start realising the value of the work-from-home model and creating engaging workplaces for employees.

Source: Financial Express

Date: 4^th January, 2021

Bata gets an Indian CEO

Bata gets an Indian CEO

For the first time in the 126-year-old brand’s history, an Indian will take the global reins

Bata India chief Sandeep Kataria has been elevated as the company’s global CEO, becoming the first Indian to lead the shoemaker’s worldwide operations.

An alumnus of IIT Delhi and XLRI, Kataria has nearly three decades of experience at companies like Unilever, Yum Brands and Vodafone in India and Europe.

Under his leadership since 2017, Bata India has doubled its profits, achieved double-digit revenue growth and ran campaigns to reposition itself as a contemporary brand, targeted at younger consumers.

Kataria joins an elite list of Indian-origin CEOs helming global organisations, including Sundar Pichai of Alphabet, Ajay Banga of Mastercard, Satya Nadella of Microsoft (LinkedIn’s parent) and Arvind Krishna of IBM. Founded in 1894, Bata is India’s largest footwear retailer and its brands like Hush Puppies, Marie Claire, North Star and Scholl are household names

India’s insurance platform Turtlemint raises $30 million

India’s insurance platform Turtlemint raises $30 million

Instead of bypassing these advisors, Turtlemint is embracing them. It works with more than 100,000 such advisors, equipping them with digital tools to offer wider and more relevant recommendations to consumers and speed-up the onboarding process, which has traditionally required a lot of paperwork.

These advisors of Turtlemint “play a critical role in bridging the gap in tier 2 and 3 towns and cities, where low physical presence of insurance companies greatly impacts seamless access to insurance products and information,” the startup said.

Turtlemint works with over 40 insurance companies in India and serves as a broker, charging these firms a commission for policies it sells. The startup said it has amassed more than 1.5 million customers.

“By developing products for the micro-entrepreneurs and the rising middle class, Turtlemint has an opportunity to have a positive impact on India’s economy,” said Hans Tung, managing partner at GGV Capital, in a statement. “Dhirendra, Anand, and their team built an incredible platform that enables over 100,000 mom-and-pop financial advisors to serve consumers’ best interests with digital tools, helping middle-class families in India get insured with the best products available.”

In an interview with TechCrunch, Turtlemint co-founder Anand Prabhudesai said the startup will deploy the fresh capital to grow its network of advisors and improve its technology stack to further improve the experience for consumers. The startup today also offers training to these advisors and has built tools to help them digitally reach potential customers.

“Continuous education is a very important aspect of being a successful financial entrepreneur. To this end, we have created an online education product with a wide range of courses on financial products, advice-based sales techniques and other soft skills. Our content is now available in seven regional languages and over 20,000 learners are active each month on our edtech platform. A lot of these are first-time advisors who are taking their first steps towards starting their advisory business. Our target is to create a million successful financial entrepreneurs over the next 3-5 years,” he said.

Source-techcrunch

Date-19-11-2020

ICICI Lombard General Insurance Q2 net rises 35%

ICICI Lombard General Insurance Q2 net rises 35%

ICICI Lombard reported underwriting profits in fire, motor and the miscellaneous retail segment in the second quarter.

ICICI Lombard General Insurance on Friday posted a 35% year-on-year rise in its net profit to Rs 415.74 crore for the second quarter of the current financial year. The non-life insurer also saw an improved combined ratio and a surge in gross direct premium income (GDPI) in the quarter under review.

The company’s GDPI stood at Rs 3,189 crore in Q2FY21, compared with Rs 2,953 crore in Q2FY20, a growth of 8%. Excluding the crop segment, GDPI increased to Rs 3,186 crore, compared with Rs 2,898 crore in the year-ago period, registering a growth of 9.9%. This was higher than the industry growth (excluding crop segment) of 9.2%.

Bhargav Dasgupta, managing director and CEO of ICICI Lombard General Insurance Company, said: “In terms of performance, large part of the growth in profit after tax (PAT) was driven by better underwriting. We also had a good quarter in terms of investment income and because of our business growth, we are

also seeing growth in investment income.”

ICICI Lombard reported underwriting profits in fire, motor and the miscellaneous retail segment in the second quarter.

The combined ratio was at 99.7% in the latest quarter, against 102.6% in Q2FY20. Excluding the impact of flood and cyclone losses of Rs 46 crore, the combined ratio was at 97.9% in Q2FY21, against 100.7% in the same period last year excluding the impact of cyclone and flood losses of Rs 45 crore.

However, health retail, health group and corporate saw underwriting losses in Q2. ICICI Lombard General Insurance has paid about 14,000 Covid-19 claims, out of about 17,000 intimated as of now. “What we are seeing is that it is the same picture for the whole industry. If you look at the September numbers, we had seen serious spike in claims intimated. Having said that, from October onwards, there seems tapering off, which is a positive sign, Dasgupta said.

The solvency ratio was 2.74x on September 30, against 2.50x on June 30, higher than the minimum regulatory requirement of 1.50x. The stock of ICICI Lombard GI on Friday ended at Rs 1,257.50, up by 0.08% or Rs 1.05 on BSE.