Health Insurance : Myths and Facts

Health Insurance: Myths & Facts

All of us know very well about the importance of health insurance. Today, everyone realize the benefit and need of having health insurance. For sales points of view it is very easy product which can be offer to the clients by the non life insurer. I have also written many blogs about it. Yesterday, I came across very useful information in the news paper which I want to share with all of you. A very well known insurer called ICICI Lombard has conducted the survey about health insurance. According to this survey that people have many misconceptions about health insurance which we will be discuss in today’s blog.

Myth1:

52% people believe that health insurance policies settle the claim only in case of hospitalization.

Reality:

9 out of 22 non life insurance companies offer OPD benefits, including dental treatment, diagnostic test expenses, vaccinations, hearing aid, eye check up, spectacles and preventive health care services.

Myth2:

27% people said I don’t need health insurance if I am fit.

Reality:

Many illnesses like dengue, malaria, food poising and critical illness can happen in healthy people due to hectic life style and pollution. Health insurance also covers injuries due to accident or violence.

Myth3:

29% people said that they have group health cover. So they don’t need a separate health insurance policy.

Reality:

Due to increasing medical cost day by day, group cover may not be enough in case of medical treatment. In case of job loss, you will need the cover. The group health insurance policies have some defined limits and constraint.

Myth4:

49% people was not sure in survey whether they can get health cover or not as they smoke or consume alcohol.

Reality:

Insurance companies offer health insurance to these types of people. In these cases loading increase the premium can be higher due to high risky habits.

Myth5:

26% people do not intend to cover their family as they think that only earning member need the health insurance cover.

Reality:

Unlike life insurance, health insurance should cover the entire family including children and parents of the customer.

Myth6:

Pre- existing diseases will be covered after waiting period so no need to declare in the proposal form.

Reality:

As per IRDA guidelines, any ailment not declared by a customer is considered an un-disclosed pre existing disease and it leads to claim rejection.

If you want more information regarding investment or you need investment services, feel free to ask us. We also conduct the seminar on investment and financial planning. If you are interested for seminar in your city just drop the mail.

Warm regards,

Arvind Trivedi

Certified Financial Planner

arvind.trivedi79@gmail.com

www.artofinvest.com

Desire V/s Need and the role of financial planning

Desire V/s Need and the role of financial planning

I have been in financial planning since last 5 year and I have noticed one thing that the average investors are not able to differentiate desire and need. In this world, every human being have some needs and responsibilities. Everyone has to fulfill basic need like bread and butter, clothes and residence. After fulfilling these basic needs, there are some other responsibilities like take care of family members and social responsibilities towards relatives and society. Here from family members means include mother and father also. As many people in India are also adopting the western lifestyle and planning only their wife and kids.

In the above paragraph, I have discussed about only human needs. These needs may be different for person to person. I have seen many person who have immense wealth but not happy as they have not separated their need and desire. When the word “Desire” comes in picture, then the peace of mind and happiness go away from human life. As there are no limit of desire and for fulfill your all desire one human life is not enough. You have to take birth many many times to fulfill your desire but it does not complete and it is the main cause of sadness and the common person are not able to enjoy the life in today’s world. As long as desire increase in your life, the other very dangerous and new element comes in your life that is called “Greed”. Once greed enters in your life you cannot be live happy life and satisfied life.

Now you are realizing that the main cause of our sadness in life is greed factor and we should completely avoid it but it is not possible. Every human being is in within influence of some amount of greed. We cannot avoid it but we can control. How it should be control? The answer of this question will give you by your financial planner. In this article I will not discuss about how to make financial plan but tell you only why and how important is it for you.

By making financial plan you will be able to draw a line between your need and desire. You will set your future goal and priorities. To fulfill your future commitment where should you have to invest that will be take care by your financial planner. Financial plan is nothing but some pieces of paper where you have described your priorities and goals and it also have the strategies how to achieve your future goal successfully. By fulfilling your commitment and goals I think most of us can live peacefully and filled with joy life with control of greed and desire.

How to make plan and what other factor play important role in financial planning, we will discuss in our other blogs and articles.

If you want more information regarding investment or you need investment services, feel free to ask us. We also conduct the seminar on investment and financial planning. If you are interested for seminar in your city just drop the mail.

Warm regards,

Arvind Trivedi

Certified Financial Planner

arvind.trivedi79@gmail.com

www.artofinvest.com

Review of LIC Jeevan Shagun Policy

Review of LIC Jeevan Shagun Policy

On 1st Sept, 2014 LIC has launced LIC Jeevan Shagun Policy for 90 days. Many of my friends and investors has inquired about this whether should they buy it or not. Today we will discuss about its features in detail for review. It is non linked, single premium, money back insurance plan with profit.

Features of LIC Jeevan Shagun Money Back Plan:

·         The minimum entry age is 18 and the maximum entry age is 45 for this plan

·   It is single premium policy. It means you have to pay premium only in starting. The policy tenure is 12 year.

·       It offer sum assured 10 times of single premium which you pay in start. It will be paid only in the case of death. The minimum sum assured is Rs 60,000 in this plan and for maximum there is no limit.

·         Loan facility also available in this plan. Loan amount is linked to surrender value. From 2^nd to 3^rd year of policy the eligible loan amount would be 50% of surrender value. From 4^th to 6^th year the loan amount would be 60% of surrender value. For 7^th to 9^th year it would be 70% of surrender value and from 10^th to 12^th year it would be 90% of the surrender value

Death Benefit:

In case death happen within 5 year from the beginning of policy your nominee will get paid basic sum assured means 10 time of your single premium and if it happen after 5 year then nominee will get basic sum assured with loyality addition.

Survival Benefit:

On survival of life insured, the insured will get 15% of the maturity sum assured at the end of 10th year, 20% of maturity sum assured at the end of 11^th policy year and 65% of maturity sum assured will get at the end of 12^th year of policy.

Surrender Value:

If you not satisfied with your policy, you have option to surrender it. If you surrender within 1 year from date of policy then you will get 75% of single premium and if you surrender policy after 1 year from the date of policy then you will get 90% of the single premium.

An example for understanding:

If a 40 year age person take Rs 1 lakh maturity sum assured, he/she need to pay Rs 59,500 ((1,00,000 / 1,000)*595) as single premium for 12 year policy cover. In case of death he/she will get 10 times of single premium, It means in this case 5.95 lakh.

In case of survival the payout he/she will get at the end of 10^th year is Rs15,000 (15% of maturity sum assured). At the end of 11^th year you will get Rs 20,000 (20% of maturity sum assured) and at the end of 12^th year Rs 65,000 (65% of maturity sum assured) and loyalty addition or bonus if any.

Should you go for this plan?

I have many times mentioned in my blog. Generally LIC policies provide returns between 5% to 7%. Low risk appetite investors who want to stay away from high risk and high return products stocks, mutual funds, etc. can opt for such policies. One should consider term insurance plans for risk coverage purpose and balance, invest in bank FD schemes or mutual funds and stocks according to their risk appetite which can provide better returns.

If you want more information regarding investment or you need investment services, feel free to ask us. We also conduct the seminar on investment and financial planning. If you are interested for seminar in your city just drop the mail.

Warm regards,

Arvind Trivedi

Certified Financial Planner

arvind.trivedi79@gmail.com

www.artofinvest.com

Pharmaceutical Sector: Recent News

Pharmaceuticals Sector: Recent News

Following are the key developments in the pharmaceuticals space in October 2014:

• US Congress is probing around 14 companies over price escalation of generic drugs including Dr Reddy’s Laboratories and Sun Pharmaceutical Industries. Other companies include Actavis, Apotex Corp, Endo International, Global Pharmaceuticals, Heritage Pharmaceuticals, Lannett Company, Marathon Pharmaceuticals, Mylan, Par Pharmaceuticals, Teva, West-Ward Pharmaceuticals and Zydus Pharmaceuticals.
• As part of its strategy to boost the presence in Iranian pharmaceuticals market, valued at US$4bn, Cipla is planning to set up a manufacturing plant in partnership with its local distributor. As per the agreement, Cipla will own a 75% stake in the plant and will invest Rs2.25bn (US$36.65 mn) over three years in areas including machinery and equipment for the facility.
• The National Pharmaceutical Pricing Authority (NPPA) has clarified to the Delhi High Court that the Centre's recent decision to withdraw its power to fix prices of non-essential medicines  will not affect its earlier order dated 10 July 2014 on the prices of 108 drug formulations.
• Ranbaxy has settled its litigation with Texas Medicaid Program (a public-funded healthcare programme for people with low income) under the settlement agreement and agreed to pay a penalty of US$39.8mn to the State of Texas in a series of tranches through August 2015.

Mergers & acquisitions/joint ventures/partnerships

• American private equity fund TA Associates is in advanced stage of talks with the promoters of Famy Care and private equity investor AIF Capital to  acquire a 35% stake in the company for US$200mn (Rs12bn), as per media reports.
• Ipca Laboratories has acquired the high-potency oral solid dosage formulations facility of Alpa Labs, situated at Pithampur near Indore, on a going-concern basis for a consideration of Rs717.1mn (US$12mn) including non-compete fees. The acquisition will allow Ipca to forward integrate hormonal APIs manufactured at its Nandesari plant (acquired from Tonira) with hormonal formulations.

• Cipla has entered into a sales and distribution agreement with Teva, whereby its South African subsidiary, Cipla Medpro, will exclusively market Teva’s product portfolio in South Africa. The partnership is subject to approval of the Competition Commission of South Africa.

• As per media reports, ChrysCapital, India's largest home-grown independent private equity (PE) firm, is negotiating with a number of potential buyers to sell its 11% stake in Mankind Pharma for  more than US$200mn, valuing the company at more than US$2bn.

If you want more information regarding investment or you need investment services, feel free to ask us. We also conduct the seminar on investment and financial planning. If you are interested for seminar in your city just drop the mail.

Warm regards,

Arvind Trivedi

Certified Financial Planner

arvind.trivedi79@gmail.com

www.artofinvest.com