The General Insurance (GI) council has proposed a new formula for determining the third party (TP) motor insurance cover in meetings with the Ministry of Road Transport and Highways (MoRTH), it suggests that the general insurers’ liability be capped at Rs. 10 lakh and the balance amount be paid from the Motor Vehicle Accident Fund. At present, there is unlimited liability as far as motor TP insurance is concerned. This means that if there is a death due to road accident, there is no upper limit on the compensation paid out.

The Council has proposed that a fuel cess be imposed on petrol / diesel purchased by customers, which would flow into the accident fund. MoRTH currently has a committee in place with representatives from the general insurance companies, Department of Financial Services and insurance regulator IRDAI. As per the Motor Vehicles Act, 2019, the Centre was to prescribe a base premium and the liability of an insurer for TP motor claims in consultation with the insurance Regulatory and Development Authority (IRDAI).

Before the financial year ends in March 2020, a lot of people will be in a rush to make those tax saving investments. One way to save tax is by claiming deduction for life insurance premium paid under section 80 c of the Income Tax Act, 1961. One can claim a deduction of up to Rs. 1.5 lakh a financial year for the premium paid for yourself, your spouse, and your children. However, LIC is bringing the opportunity of paying the policy premium through credit card, for those who ae short of cash.

This is especially useful for those last minute tax savers who do not have enough money in their bank accounts. In order to promote the usage of credit cards, LIC also announced that it has waived off charges on credit card payments.  In a statement the LIC said, From December 1, 2019, an credit card originated payments towards renewal premium, new premium, ir repayment of loan and interest on loans against the policies towards renewal premium, new premium, or repayment of loan and interest oin loans against the policies will not attract any additional charges or convenience fee its parlance.

The merger of three public sector general insurance companies namely United India Insurance Co. Ltd, Oriental Insurance Co. Ltd and National Insurance Co. Ltd is in full swing. The board of directors of the three companies have passed the resolution in their respective boards for the amalgamation of the same. 

In budget 2020, FM has announced the dilution of its holding in Life Insurance Corporation of India. Lots of debates are happening in this regard amongst the policy holders and its employees in this regard.

Happy reading

Thanking you for the opportunity given to serve you,

Yours faithfully

For Link-K Insurance Broker Co. (Pvt.) Ltd

V.P. Mohankumar

Principal Officer and Managing Director