GIPSA CHIEF IN TROUBLE WITH C.B.I.

Dear viewers,

Central Bureau of Investigation (CBI) conducted raids on the premises of Oriental Insurance Company.

Dharani Mishra, CBI spokesperson said that Oriental Insurance gave credit-based insurance policies to Paramount Airways, without following any procedures.

The CBI suspects that M Ramadoss, former Chairman and Managing Director of Oriental Insurance Company, present Chairman of the The New India Assurance Co Ltd, entered into a conspiracy to favour Paramount Airways which is a low-cost airliner.

M Ramadoss, former Chairman and Manging Director of Oriental Insurance has also been the chairman of the governing body of General Insurers' (Public sector) Association of India (GIPSA). Mr Ramadoss takes over as the chairman with effect from 1 Jan 2007.

The post of CMD of New India Assurance Co Ltd fell vacant after the existing chairman of the association-B Chakrabarti, completed his term on 30.09.2009.

The Mumbai-based New India Assurance was headless for nearly two months, with A.R. Sekar, the company’s general manager, working as its acting chief. from 1.10.2009 to 31.12.2009

The normal practice is to transfer the senior-most among the chairmen-and-managing directors of the three other public sector general insurers — National Insurance, Oriental Insurance and United India Insurance — as the chief of New India Assurance.

Mr Ramadoss took charge in Oriental Insurance Company on January 12, 2005.

He joined Insurance Industry in 1976 as direct recruit Class I officer in New India Assurance Company and worked in various positions. In 2001, he was promoted as General Manager and posted to London Branch for 3 years. He returned to India and joined Head Office in the Middle of November, 2004.

Mr Ramadoss is a first class commerce graduate from Madras University and Chartered Accountant from Institute of Chartered Accountants of India. He is also Fellow of Insurance Institute of India and an Associate of Chartered Insurance Institute of UK.

Mr. Ramadoss has the unique experience of having worked in the Insurance Industry in different parts of the country and different fields like Operations, Investments, Finance and Information Technology.

He is:
President, Insurance Institute of India
Chairman, Office of the Governing Body of Insurance Council
Chairman, Governing Board, National Insurance Academy, Pune
Chairman, The New India Assurance Company (Trinidad & Tobago) Ltd., Port of Spain
Director, Prestige Assurance Plc, Nigeria
Director, India International Insurance Pte. Ltd., Singapore
Chairman, Insurance Committee, Bombay Chamber of Commerce & Industry, Mumbai
Chairman, Insurance Committee, The Associated Chambers of Commerce & Industry of India, Delhi
Member, Reinsurance Advisory Committee, IRDA (Regulator)
Member, Policyholders’ Protection, Intermediaries etc. Regulations Advisory Committee, IRDA

......While Paramount Airways was preparing to re-launch flight services, the low-priced airliner pocketed a blow on July 18 when officers of CBI raided its office and house of its proprietors in Madurai.

The Economic Offences Zone of Delhi, CBI, carried out raids on the premises of two firms including Paramount Airways and Oriental Insurance Company Limited at six places in Mumbai, Chennai and Madurai.

CBI spokesperson Dharani Mishra stated, "Oriental Insurance gave credit-based insurance policies to Paramount without following any procedures. The CBI suspects that the former chairman and managing director of Oriental Insurance, M Ramadoss, entered into a conspiracy to favour Paramount."

Around 10 CBI functionaries took part in the raid. Sources stated that one group of six people reached the Paramount office at the airport at 7 a. m.

The group searched the office for some hours and left it around 1p. m. and joined another group, which was carrying out searches in the house of Paramount chairman M Thyagarajan at Thirunagar, Madurai.

It is discovered that the officers explored another house in Kochadai plus the properties of Thyagarajar Mills in Kappalur on the outskirts of Madurai.

Sources in the Paramount management refused the episode, saying that it was neither a raid, nor the officers were from the CBI.

A Paramount functionary stated, "We had applied for security clearance to relaunch our flight service shortly. The visit by the team was in connection with issuing of security clearance. This is part of the normal procedure."

----- EDITOR

Insurance and Indian Budget 2011-2012

Proposals in Indian Budget 2011-2012

A. Budget proposes to move the following legislations in the financial sector:

(i) The Insurance Laws (Amendment) Bill, 2008;

(ii) The Life Insurance Corporation (Amendment) Bill, 2009;

(iii) The revised Pension Fund Regulatory and Development Authority Bill, first introduced in 2005;

B. Services provided by life insurance companies in the area of investment are also proposed to be brought into tax net on the same lines as ULIPs.

C. Budget also proposes to extend the Rashtriya Swasthya Bima Yojana - a health insurance for the poor - to cover workers of the unorganized sector like hazardous mining and associated industries like slate and slate pencil, dolomite, mica and asbestos.

Analysis

The insurance legislation would increase the FDI limit to 49 percent from the current 26 percent.

The LIC bill would increase the share capital of Life Insurance Corporation (LIC) to Rs.100 crore from its current Rs.5 crore.

The PFRDA Bill would bring in a full-fledged regulator for the pension sector. Now it is regulated by an interim authority.

Insurance bill will empower IRDA (Insurance Regulatory and Development Authority) to introduce forward-looking regulations to promote sustainable growth of the industry. The bill gives a lot of flexibility to the IRDA in framing regulations.

Due to the modification proposed in budget for service tax on fund management charges, some guaranteed unit linked insurance policies (ULIPs) will attract higher charges.

A very senior citizen category has been introduced at the age of 80 years and above with exemption limit of Rs.500,000. Also increase in income tax exemption limit to Rs.250,000.for senior citizens and the reduction in the age limit for senior citizens to 60 years will help seniors to enjoy pension in the retirement years without tax impact.

NOTE:

The bills relating to the insurance sector has been pending for past several years.

The Insurance Laws (Amendment) Bill, 2008 was introduced in the Rajya Sabha in December 2008 and was referred to the Standing Committee on Finance in September 2009. The committee is yet to submit its report.

Life Insurance Corporation (Amendment) Bill, 2009 was introduced in the Lok Sabha in July 2009 and was referred to the Standing Committee on Finance, which submitted its report in March 2010.

Pension Fund Regulatory and Development Authority Bill was first introduced in 2005 It lapsed with the dissolution of the 14th Lok Sabha

Insurance reforms in 2011-12 mainly depend on how soon the government is able to get insurance related bills introduced & passed.

...... EDITOR

Bancassurance: emerging trends, opportunities and challenges

DEAR FRIENDS,
According to a recent sigma study, bancassurance is on the rise, particularly in emerging markets. Worldwide, insurers have been successfully leveraging bancassurance to gain a foothold in markets with low insurance penetration and a limited variety of distribution channels.

Bancassurance, the provision of insurance services by banks, is an established and growing channel for insurance distribution, though its penetration varies across different markets. Europe has the highest bancassurance penetration rate. In contrast, penetration is lower in North America, partly reflecting regulatory restrictions. In Asia, however, bancassurance is gaining in popularity, particularly in China, where restrictions have been eased. The research shows that social and cultural factors, as well as regulatory considerations and product complexity, play a significant role in determining how successful bancassurance is in a particular market.

The outlook for bancassurance remains positive. While development in individual markets will continue to depend heavily on each country’s regulatory and business environment, bancassurers could profit from the tendency of governments to privatise health care and pension liabilities. In emerging markets, new entrants have successfully employed bancassurance to compete with incumbent companies. Given the current relatively low bancassurance penetration in emerging markets, bancassurance will likely see further significant development in the coming years.

Emerging Trends ::

Though bancassurance has traditionally targeted the mass market, bancassurers have begun to finely segment the market, which has resulted in tailor-made products for each segment. The quest for additional growth and the desire to market to specific client segments has in turn led some bancassurers to shift away from using a standardised, single channel sales approach to adopting a multiple channel distribution strategy. Some bancassurers are also beginning to focus exclusively on distribution.

In some markets, face-to-face contact is preferred, which tends to favour bancassurance development. Nevertheless, banks are starting to embrace direct marketing and Internet banking as tools to distribute insurance products. New and emerging channels are becoming increasingly competitive, due to the tangible cost benefits embedded in product pricing or through the appeal of convenience and innovation.

Finally, the marketing of more complex products has also gained ground in some countries, alongside a more dedicated focus on niche client segments and the distribution of non-life products. The drive for product diversification arises as bancassurers realise that over-reliance on certain products may lead to undue volatility in business income. Nevertheless, bancassurers have shown a willingness to expand their product range to include products beyond those related to bank products.

Strategic Challenges ::

These developments are expected to challenge traditional bancassurers in the following ways:

The shift away from manufacturing to pure distribution requires banks to better align the incentives of different suppliers with their own.

Increasing sales of non-life products, to the extent those risks are retained by the banks, require sophisticated products and risk management.

The sale of non-life products should be weighted against the higher cost of servicing those policies.

Banks will have to be prepared for possible disruptions to client relations arising from more frequent non-life insurance claims.

.......EDITOR

India – The Next Insurance Giant in Asia-Pac

DEAR VIEWERS,

Insurance is one major sector which has been on a continuous growth curve since the revival of the Indian economy. Taking into account the huge population and growing per capita income besides several other driving factors, a huge opportunity is in store for the insurance companies in India. According to the latest research findings, nearly 80% of Indian population is without life insurance cover while health insurance and non-life insurance continues to be below international standards. And this part of the population is also subjected to weak social security and pension systems with hardly any old age income security. As per our findings, insurance in India is primarily used as a means to improve personal finances and for income tax planning; Indians have a tendency to invest in properties and gold followed by bank deposits. They selectively invest in shares also but the percentage is very small--4-5%. This in itself is an indicator that growth potential for the insurance sector is immense. It’s a business growing at the rate of 15-20% per annum and presently is of the order of $47.9 billion.

Topics covered in the report:
- Trend analysis of Indian economy and growing macroeconomic factors and
- India’s position in the context of emerging countries
- Historical growth trends & growth drivers of Insurance & its sub-sectors in India and outlook till 2011.
- Market size of insurance sector (total, life & non-life) since 2000 till 2007
- Market forecast of insurance sector (total, life & non-life) between 2007 and 2011
- Key issues & challenges, major trends & opportunities
- Government’s initiatives to promote & regulate the insurance market
- Competitive landscape and market share of top players
- And many more...

Emerging Areas:
- Healthcare Insurance & Pension Plans
- Mutual fund linked insurance products
- Multiple Distribution Networks .i.e. Bancassurance

Major Driving Factors:
- Growing demand from semi-urban population
- Entry of private players following the deregulation
- Rising demand for retirement provision in the ageing population
- The opening of the pension sector and the establishment of the new pension regulator
- Rising per capita incomes among the strong middle class, and spreading affluence
- Growing consumer class and increase in spending & saving capacity
- Public private partnerships infrastructure development
- Dearth of innovative & buyer-friendly insurance products
- Success of Auto insurance sector
- - - - - - - EDITOR

India: Insurance Industry to stick to current solvency standard

DEAR VIEWERS,

The insurance industry in India will continue to observe its current solvency rules even though insurers in other countries are moving over to the new Solvency II regime, according to local media reports.

"Our country does not have the required statistical database to adopt Solvency II norms that have been devised by the European community," says says Mr RK Nair, a member of the IRDA which is not keen on adopting Solvency II rules in India.

Solvency II is a risk-based model for all insurers and reinsurers in the European Union. The rationale is to facilitate the development of a single market in insurance services in Europe, while ensuring adequate consumer protection through a risk-based approach to supervision. Scheduled to be implemented in January 2014, Solvency II comprises a new set of capital requirements, valuation techniques and governance and reporting standards.

"The challenge for India, however, is that evaluation of risk can throw up different figures for regulators, insurers and valuers because there are no proper systems of evaluation or calculation of such risks in India," says Mr Nair. "We have a factor-based process in India to calculate solvency. Our regulator and the industry are comfortable with that."

India's current solvency framework is in line with Solvency I model which itself is based on the EU's insurer solvency regime put in place in the 1970's. This requires insurers to maintain a minimum solvency ratio, which currently is 150% for Indian life insurers and 130% for non-life insurers. The required solvency margin is thus easy to compute and to monitor. However, it does not recognise the size of the insurer's portfolio, type of business, operational risk and risk management practices such as reinsurance and underwriting.

.......EDITOR

Public general insurers' own TPA to be ready soon

Dear All,
The Third Party Administrator (TPA), proposed to be set up by the public insurers for health insurance, is likely to be a reality in next three months.


``The process is on and it may take three more months to be ready,’’ Mr G Srinivasan, Chairman and Managing Director, United Indian Insurance Company Ltd (UIICL) told newspersons here on Monday.  Mr Srinivasan was here (Hyderabad) to sign an agreement with State Bank of Hyderabad (SBH) to extend free personal accident insurance to the latter’s customers.

Four public sector general insurers - New India Assurance, Oriental Insurance, National Insurance and United India Insurance announced their plan to float their own TPA stating that the practices of private TPAs were resulting in losses in health insurance business.

``A common TPA for the State-run general insurance will lead to better negotiation of prices with hospitals, among others. The whole health insurance business will have a positive impact,’’ Mr Srinivasan said.

TARGET

On his company’s business growth, Mr Srinivasan said a `better’ business growth was expected due to improved conditions in the economy.

``Last year, our premium income was at Rs 6,400 crore which marked a 22 per cent growth over the year-ago period. We will do well this year and may clock Rs 8,000 crore in premium,’’ the CMD said.

BANCASSURANCE

On the recommendation of an IRDA panel that banks should be permitted to act as corporate agents for two sets of insurers in each segment, he said: ``Our personal view is that opening up of bancassurance channel is not advisable.’’ At present, banks are allowed to take up corporate agency of only one insurer in each segment of life, general and health.

``Bancassurance is a long-term relationship and there is no shortage of products. Opening up of sector may not help improving customer service as being thought,’’ he added.


...... EDITOR

DECLARATION OF MEAGRE VACANCIES -PROMOTIONAL EXERCISE WITHIN CLASS-3 - ASSISTANT CADRE - 2011

DEAR FRIENDS,

At last the Management has declared a meagre number of  5 vaancies for Hyderabad Region and 3 Vacancies for Vizag Region for the pomoional exercise of 2011 for the post of ASSISTANT.  As a responsible trade union and in the larger interest of the aspirants, the GICEU-AP has immediately reacted on this matter and demanded the Management for declaraion of  more number of vacancies.   Expressed the anguish of the aspirants about the declaraion of  meagre number of vacancies. Also explained about the necisisty and requirement of the Assistants (entry cadre) in the day to day operations at every operating office level to meet the customer requirements / demands which is oder of the day in the new environment. 

Also demanded for a fresh recruitment on All India basis in all the entry cadres including marketing, as the most of the employees (nearly 50% to 60%), irrespecive of cadre and strength /rank and file, are laying down the Office between 2012 - 2014, due to reaching superannuation. It is the high time for the Management to have a immediate meaningful discussions with the Check-off qualified Unions on various matters, who are playing a vital role in shouldering every responsibility in  keeping up the promises given to all it's clientele (big or small), on whom we are all depended upon (right from PTS to CMD).

More over, it is the high time for the Boards of the GIPSA memeber Company's are required to concentrate on recruting the people in all entry cadresincluding the marketing personnel and agency force for rebuilding  the past glory of PSUs AND meeting new challenges before of all of us in this competeitive world.  Lest, day is not far of to loose the PSUs share drastically in the market. 

Let us hope and believe that the Management would definitely change their attitude and approach towards their own employees, who are the internal customers and staunch supporters in all back office operations and making the PSUs towards reaching new heights and growth of the Insurance Industry.

With Warm Regards,

.... EDITOR

Vacancies within Class I-Tentatively

All Officer members,
Our parent body NFGIE informed that  the following vacancies may declare within couple of days within Class I:

Scale I to II          216(Seniority upto 708)
Scale II to III       140(Seniority upto 539)
Scale III to IV       55(Seniority upto 242)
Scale IV to V        18(Seniority upto 127)

Written exam date 31/7/2011

M Hanumantha Rao                               T Gopala Krishna
President                                            General secretary

Amendments in Promotion Policy for Officers

Dear Friends,
We are pleased to inform that National Insurance Company adopted the amended promotion policy within Class I its board meeting 331 vide Ref.HO:Pers:MPL.Dept.F002/2011 dated 17th June, 2001. The board of the company has approved  two amendments in the promotion policy for officers with immediate effect for implementation from 2011-12 exercises. These amendments are as under:

1.Extended Eligibility of Officers qualifying in Written Test: In response to representation received from various quarters, the Board has agreed to provide for including an Officer, who has qualified in the written test under promotional process for a particular year, in the promotional process for next two promotional exercises for the set of promotions determined under clause (b)of Para 14.2 of the promotion policy.

2.Fast track Promotions:Not withstanding anything conained in this policy, starting from the promotional exercise for the year 2011-12,for promotion of officers upto scale IV in the company, there shall be, in addition to the already existing channle (to be referred to as the Normal Channel)of promotionsunder thispolicy, another channel of promotions, to be known as "Fast TrackChannel"with the following provisions:

a)20%(fractin 0.5 and above being taken as 1)of vacancies as determined under para 6 of the policy for a financial year for promotionto scale II, Scale III and Scale IV in the company shall be earmarked for being filled up through Fast Tract Channel, the remaining vacancies being available for the Normal Channel

b)To be eligible to participate inthe Fast Track Channel, an Officer should have completed minimum three years of continuous service from the date of selectionto the existingcadre,as on 31st March of the year prescribed for the purpose of para 8.2 from time to time, besides possessing the qualification of;

Associate of Insurance Institute of India or equivalent for promotion to scale-II or Scale- III, and

Fellow of Insurance Institute of India or equivalent for promotion to scale-IV.

Provided however,for the promotional exercise for the years 2011-12 and 2012-13,to beeligible to paricipate in the Fast Tract Channel, an officer should have completed miimum four yearsof continuous serice from the date of selection to the existing cadre, as on 31 March of the year.

d)An Officer eligible to participate inthe Fast Track channel of Promotions and desirous of the same shall have to apply for it against a notice to be published by the company for this purpose.

e)An officer applying for the fast Track channel of promotions ahall be required to appear in the writtentest and secure a minimum of 60 (54 SC/ST)or more marks .

f) Scheme of Weightage:
WrittenTest Scale I to II: 40; Scale II to III: 40;  Scale III to IV: 40
Qualification                  5                        5                         Nil
Work Record                40                       40                         40
Interview                    15                       15                         20

Written Test :Forevery marksecured in the written test, a score of 0.40 in the scheme of weightage shall be alloted. For example, for a score of 60 in the written test,the officer shall be alloted 24 marks out of 40 in the above shcame of weightage.

Scale I&II officers possessing the qualification of Fellow shall be alloted 5 marks

The work record shall be assessed through the annual CRs as per the annual performance

Only two attempts shall be allowed for promotion to a particular cadre under the Fast Tract Channel, which shall be counted within the over all 3 attempts

For more information, please wait for official cirucular of New India, which is being approved by the New India Board meeting.

 M. HANUMANTHA RAO                T GOPALA KRISHNA                           President                                     General Secretary

PROMOTIONS WITH IN CLASS-1 CADRE - 2011 - SOME FLASH INFORMATION

DEAR FRIENDS,

WE HAVE RECEIVED THE FOLLOWING INFORMATION THROUGH RELIABLE SOURCE FROM GIPSA.

1.VACANCIES APPROVED BY BOARD - ONE MORE BATCH LIKELY TO BE CONSIDERED IN EACH SCALE.

2.WRITTEN EXAM MARKS WILL BE CARRIED FORWARD FOR NEXT TWO YEARS.

3. FAST TRACK PROMOTION IN CURRENT EXERCISE.

4. GIPSA EXAM TENTATIVELY IN THE LAST WEEK OF  JULY, 2011.

More details in regard to revised guidelines for promotional exercise viz., eligibility crieteria etc.,  will be published within a weeks time. 

WITH REGARDS,

 

M. HANUMANTHA RAO     T. GOPALA KRISHNA

                   PRESIDENT               GENERAL SECRETARY              

MERGERS IN GENERAL INSUANCE

DEAR VIEWERS,

Geneal Insurance companies intending to go for amalgamations are likely to be subjeted to an independent valuaion by the regulator.

In a Gazette notification of Scheme for Amalgamaion and Transfer of General Insurance Business Regulations - 2011, Mr. J.Hari Narayan, Chairman, IRDA said an independent actuarial valuation of value of transacting parties would be done.

The encompassing assets, liabilities and solvency position of the Companies involved could be done by the IRDA "at any time prior to granting final approval to the proposed scheme", he said.

Giving primacy to the protection of policyholders' interest, the IRDA said that after the grant of in-principle approval of the amalgamation scheme, the copies of the proposed scheme should be kept open for inspection by the policyholders' at the registered / corporate office besides uploading them on their respective web sites.

"Such inspetion and access to the documents should be kept open unill the complete implementation of the sheme," the notification said.

NOTICE OF INTENTION:

Every application for merger should be preceded by a notice of the intention to make an application at least one month before the actual date o appliaion.

This should be accompanied by a draft of the agreement for amalgamation and transfer of business, balance shees of each of the Insurer involved, finanial condition report, repot on the scheme by an independent actuary and a note on how policyholders' interest would be protected, among others.

At present, there are 24 players in the General Insurance segment.  Of this, Reliance General Insurance  and Royal Sundaram had already applied to the IRDA for MERGER.

"However, they will now havae o apply to us again in line with the notified scheme," Mr Hari Narayan told Business Line.

COUTESY: Business Line-10-06-2011

----- EDITOR 

PROMOTION RESULTS DECLARED FROM CLASS-3 TO CLASS-1:: FOR SOUTH ZONE

DEAR FRIENDS,

AT LAST, TODAY LATE EVENING THE NEW INDIA ASSUANCE HO MANAGEMENT HAS DECLARAED THE FINAL RESULTS OF SUCCESSFUL CANDIDATES FROM CLASS-3 TO CLASS-1 CADRE FOR SOUTH ZONE. THE FOLLOWING CANDIDATES HAVE BEEN ELEVATED TO CLASS-1 OFFICER CADRE UNDER HYDERABAD AND VISAKHAPATNAM REGIONS.

HYDEABAD REGION:

PARA: 13.1
1. M. Srinivasulu -  SC on own  Merit
2. Sailaja R Murthy
3. J. Raghuram
4. J. Krupakar - SC
PARA 13.2 :
1. U. Anantha Krishna-
2.K. Jayapal - SC on own merit
3. P. Dharma Raj
4. V. Srinivasulu
5.P. Vijayalakshmi -SC on own merit
6. P. Manjula
7. P. Powlayya - SC on own merrit
8. P. Ranga Babu
9. A. Swamy Naik - ST

VISAKHAPATNAM  REGION:

PARA: 13.1
1. K. Srinivasa Rao
2. U. Raghu - SC
PARA: 13.2
1.SNS Pavan Kumar
2. Rajeswara Murthy
3. M. Srinivas
4. V.N.V.Satyanarayana
5. PSRVSV Sasty
6. Malyadri -SC on own merit
7. G. Appala Raju - SC on own merit
8. V. Rama Rao

Detailed circular follows. The  GIC Employees' Union is expressing its hearty congratulating to all the promotee colleague members. Postings will be done only upon sending the recommendations to The Promoting Authority at Head Office by respective Regional In-charges.

With Warm Greetings,

M. HANUMANTHA RAO                T. GOPALA KRISHNA

                      PRESIDENT                          GENERAL SECRETARY          

NEWS UPDATION

DEAR FRIENDS/VIEWERS,

As we have been receiving en-number of telephone calls from various quarters, we furnish here under the latest position in respect of 1) Promotions under Para 13.1 & 13.2 (South Zone), 2) Announcing the Senioity Lists for all cadres in Class-1  &  Declaration of promotional vacancies for Class-1 for 2011.

The appex body "NFGIE" is vigourously following up the all these matters with New India Management at HO. Mumbai and  All India  General Secretary, Mr.Vasanth H Khade has just informed the latest position at HO.

1. DECLARATION OF RESULTS UNDER PARA 13.1 & 13.2 SOUTH ZONE:

Actually results are expected to be declared today (26-5-2011) late evening  by the Management. Understood that due to certain technicalities it may take one more day or Two. Believe that the Management  is making every effort to complete the exercise on or before 31st MAY, 2011. Let us be positive, friends.

2. In regard to the seniority lists, are still under updation and taking a final shape at HRM/HO.  The declaration of pomotional vacancies for all cadres with in the Class-1, will take place simultaneously on completion of seniority list by 01st June, 2011.  

This is for your information.

With Warm Greetings,

......EDITOR

PROMOTION RESULTS FROM CLASS-3 TO CLASS-1:: FOR SOUTH ZONE

Dear Friends,

We learnt from the reliable sources that the long awaited results in respect of promotions from Class-3 cadre to Class-1 (para 13.1 & 13.2) are being announced late evening of today or early hours of 26-05-2011 by New India Management.

Also undestand that all the promoted candidates are to be reported likely on or or before 31-05-2011 at the place of posting given to them and understand that seniority will be protected.

Awaiting further detailed cirular in this regard, for more clarity  /confirmation from the management. 

In advance GICEU-AP, Congratulating all the promotee colleague friends, and Wishing all the Best and every success in their new assignments in the promoted cadre.

WITH WARM GREETINGS,

M. HANUMANTHA RAO                T. GOPALAKRISHNA

        PRESIDENT                          GENERAL SECRETARY

Primer: Tax saving with 80C

Dear Viwers,

To encourage savings, the government gives tax breaks on certain financial products under Section 80C of the Income Tax Act. The section helps you save taxes on investments up to 1 lakh - if you are in the highest tax bracket of 30%, you can save Rs 30,000 in taxes. Here are the options available under the section:

PF & VPF: Provident Fund (PF) is deducted from your salary. Your employer also contributes to it. While the employer's contribution is exempt from tax, your contribution is counted as investment under Section 80C. You can also contribute additional amounts to Voluntary PF (VPF). The EPFO has announced a 9.5% rate of return on deposits for 2010-2011. Also, the interest earned on the investments is tax-free.

Public Provident Fund (PPF): A PPF account can be opened with a nationalised bank or a post office. The rate of interest earned is 8%, which is tax-free, and the maturity period is 15 years. The minimum required contribution is Rs 500 per year and the maximum allowed is Rs 70,000.

.....EDITOR

GOVT. ALLOWS TAX EXEMPTION ON 9.5% INTEREST ON PROVIDENT FUND FOR 2010-11

DEAR VIEWRS,

Giving relief to 4.71 crore subscribers of EPFO, the government has allowed tax exemption on the 9.5% interest income on PF deposits for 2010-11. The finance ministry notification last week raises the income tax exemption to 9.5% interest income from 8.5%. The decision clears the air for the EPFO's subscribers who were given increased interest rate by one percentage point for 2010-11, but the finance ministry had not matched the interest hike with a commensurate tax exemption.

In the absence of the commensurate income tax exemption, the subscribers were earning higher returns even as it was liable to income tax.

EPFO had decided to provide 9.5% interest rate on PF deposits for 2010-11 after which it was endorsed by the finance ministry in March this year.

In 2001, finance ministry had allowed tax exemption on interest income of up to 12% on PF deposits. This exemption prevailed till August 31,2010.

In August last year, finance ministry had notified tax exemption of upto 8.5% tax on interest income on PF deposits from September 1, 2010, onwards which now stands superseded.

EPFO had decided to pay 9.5% rate of return for 2010-11 after it found a surplus of Rs 1,731 crore. But the rate was stagnant at 8.5% for five years since 2005-06.

EPFO had also maintained interest rate of 9.5% for three consecutive fiscals from 2002-03. The rate of return was 11 and 11.25 percent in 2000-01 and 2001-02 respectively.

The interest income was even higher at 12% 10 years during 1989-90 to 1999-2000.

..... EDITOR

CORPORATE NEWS UPDATES

DEAR FRIENDS,

WE ARE PLEASED TO FURNISH HERE THE FOLLOWING INFORMATION,  RECEIVED FROM OUR APEX BODY NATIONAL FEDERATION, MUMBAI FOR FAVOUR OF ALL CONCERNED, WHICH WAS ALREADY SENT THROUGH "SMS" AND / OR TELEPHONICALLY TO ALL UNIT IN-CHARGES.

1) Leave Travel Subsidy Eligibility has been increased from 2000 Kms each way to 3000 Kms by New India Board, with effect from 11th May, 2011. The employees  who have not availed LTS blocks as per present eligibility, may avail now.

2) The New India Management has duly appoved the long awaited conversion of all Part Time Sweepers to Full Time Sweepers.

3) The written examination in respect of promotions with in the Class-I cadres (Scale -I to II to III to IV to V) will be likely held on 19th/26th June, 2011 at all Metro centres. Exact date will be known only after finalisation of scalewise seniority list by HRM/HO and declaration of vacancies for class-1 cadres for the current year promotional exercise.

4) Further,it is understood that promotions in respet of Class-II (Development Officers) i.e. from Grade-II to Grade-I; Enhancement of Leave encashment period on retirement ( 240 days to 300 days); Enhancement of Vehicle Loan to Class-III & IV employees (from Rs.25,000/- to Rs.50,000/-) and other non-core benefit matters will likely come up in the ensuing Board meetings of New India.

With warm Greetings,

Yours-in-service,

                   M. HANUMANTHA RAO       T. GOPALA KRISHNA

                        PRESIDENT                GENERAL SECRETARY

Retirement Age to 62 - Central Cabinet Sub Committee likely to Approve

DEAR FRIENDS,

 

Retirement Age of Central Government Employees.

 

The retirement age of Central Government employees is likely to raise to 62 years.

The decision in this regard may be taken by the Central Cabinet Sub Committee this week.

More News will follow..
Posted by bINu Friday, May 6, 2011
.... EDITOR

"" Just a thought for the National Anthem ''"

Dear Viewers/ Friends,

Someone needs to check this out

'Jana Gana Mana' - Just a thought for the National Anthem! How well do you know it?

Our national anthem, 'Jana Gana Mana', is sung throughout the country. Did you know the following about it? I didn't. I have always wondered who is the 'Adhinayak'and 'Bharat Bhagya Vidhata', whose praise we are singing.

I have always thought it might be To begin with, Jana Gana Mana, was written by Rabindranath Tagore in honor of King George V and the Queen of England when they visited India in 1919.

To honour their visit, Pandit Motilal Nehru had five stanzas included that are in praise of the King and Queen. (And most of us think it is in praise of our great motherland.)

In the original Bengali verses only those provinces that were under British rule, i.e., Punjab, Sindh, Gujarat , Maratha, were mentioned. None of the princely states, which are integral parts of India now, such as Kashmir, Rajasthan, Andhra, Mysore and Kerala, were recognized.

Neither the Indian Ocean nor the Arabian Sea were included because they were directly under Portuguese rule at that time. Jana Gana Mana implies that King George V is the lord of the masses and Bharata Bhagya Vidhata, or 'the bestower of good fortune'.

Here is a translation of the five stanzas that glorify the King.

Stanza 1: The (Indian) people wake up remembering your good name and ask for your blessings and they sing your glories (Tava shubha name jaage; tava shubha aashish maage, gaaye tava jaya gaatha)

Stanza 2: Around your throne, people of all religions come and give their love and anxiously wait to hear your kind words.

Stanza 3: Praise to the King for being the charioteer, for leading the ancient travellers beyond misery.

Stanza 4: Drowned in deep ignorance and suffering, this poverty stricken, unconscious country? Waiting for the wink of your eye and our mother's (the Queen's) true protection.

Stanza 5: In your compassionate plans, the sleeping Bharat (India) will wake up. We bow down to your feet, O Queen, and glory to Rajeshwara (the King).

This whole poem does not indicate any love for the Motherland, but depicts a bleak picture of it. When you sing Jana Gana Mana, whom are you glorifying? Certainly not the Motherland. Is it God? The poem does not indicate that. It is time now to understand the original purpose and the implication of this, rather than blindly sing as has been done the past 60 years.

May be we should shift to Vande Mataram or Saare Jahan Se Achcha, which are far better compositions in praise of India.

Please don't break the chain -- let's see how many people get to know about this.

> BE PROUD TO BE AN INDIAN   >  BHARAT MAA KI JAI HO !

....... EDITOR

NEW INDIA WILLING TO SACRIFICE TOP LINE GROWTH FOR PROFITABILITY

Dear Viewers,
BUSINESS LINE PUBLISHED NEW INDIA CMD'S INTERVIEW - PLEASE READ AND INFORM OTHERS
 Expects 35% growth in premium income in 2010-11


Chennai, April 25:

New India Assurance expects its profitability in 2010-11 to take a hit due to provisioning for losses from motor pool, wages and pension contributions. The company posted a net loss of Rs 90 crore for the nine months ending December 31, 2010.

Mr M. Ramadoss, Chairman and Managing Director, New India Assurance, told Business Line, that provisioning for pension contribution is estimated at Rs 500 crore and another Rs 600 crore would have to be set aside to absorb the losses from motor pool.

The premiums for third party motor insurance on cars, trucks and buses were recently hiked by the insurance regulator. Premiums were raised in relation to claims of vehicles.

Premiums on cars were increased by 10 per cent, for trucks and buses they went up by 70 per cent. A minimum hike of 80 per cent on premium for trucks is being sought . Even this he felt was inadequate to absorb the losses arising from claims of third party on motor accidents.

Mr Ramadoss pointed out that insurers had to make nearly 153 per cent provisioning to cover the losses from motor third party. Public insurers have to bear greater share of third party losses because they insure 60 per cent of the market. (The motor pool losses are apportioned to various companies in proportion to their market share in the non-life insurance business.)

Premium Income

New India Assurance expects to close financial year 2010-11 with a premium income of about Rs 8,250 crore, reporting a growth of 35 per cent from the previous year. It is the largest insurance company in terms of premium income. New India Assurance is willing to sacrifice top-line (premium income) to grow its profitability.

The loss ratio in insuring companies for various risks (group insurance) is high. Therefore the public insurer has made a conscious decision to reduce its exposure to this segment.

Therefore New India Assurance is focusing on growing its premium income from insuring the valuables and health of individuals than corporates.

High-claims

“We decline to renew group insurance where the claims ratio is high,” he said. With insurers free to fix the premiums, they are undercutting themselves to offer the lowest premium to cover various risks of companies.

Mr Ramadoss, said, “Providing group insurance is not business but donation”. For every Re 1 earned as premium, the insurer paid out about Rs 1.20 or more as claims.

Nearly 15 per cent of the Rs 6,042 crore premium incomes in 2009-10 for the public insurer came from its overseas operations. Mr Ramadoss said it is more profitable to underwrite risk outside India.

....... EDITOR