Nu 15bn as­sured in life pol­icy schemes

Business Bhutan - - Money - Dechen Dolkar

With Bhutanese be­com­ing more sav­ing-ori­ented and fu­ture-savvy, the Royal In­sur­ance Cor­po­ra­tion of Bhutan (RICB) recorded Nu 15bn as as­sur­ance and a to­tal num­ber of pol­icy hold­ers at 109,039 as of Au­gust this year.

Mil­len­nium ed­u­ca­tion pol­icy and money bag pol­icy are the most saleable life in­sur­ance ser­vices in the coun­try as of now.

Cur­rently, there are around 24 prod­ucts un­der the life in­sur­ance scheme. Some are term in­sur­ance pol­icy, whole life pol­icy and en­dow­ment pol­icy and com­bi­na­tion of both term and en­dow­ment pol­icy.

Life in­sur­ance plans aim to make up for the fi­nan­cial loss to a fam­ily in the event of un­for­tu­nate death to the as­sured and for old age pro­vi­sion.

The Gen­eral Man­ager un­der the life in­sur­ance depart­ment of RICBL, Karma Sonam Tsh­er­ing said that the most availed prod­uct is mil­len­nium ed­u­ca­tion. This pol­icy is tar­geted for chil­dren from aged zero to 10 years availed by ei­ther of the par­ents.

The max­i­mum sum as­sured is Nu 1mn and min­i­mum Nu 30,000. The ben­e­fit of this pol­icy is that the in­vest­ment comes with in­ter­est, life cover if there is death of a child and a par­ent and it is also per­sonal in­come tax de­ductable.

GM said that the sec­ond most pop­u­lar prod­uct is money bag pol­icy. Money bag pol­icy can be availed by peo­ple if they are aged 18 years and above.

He said that ac­cord­ing to their age and fi­nan­cial ca­pac­ity, the sum as­sured can be cho­sen. In be­tween, pol­icy hold­ers get sur­vival ben­e­fits af­ter ev­ery three and four years de­pend­ing upon the term of the pol­icy.

Some of the fac­tors of the pol­icy are lesser the term more amount peo­ple have to pay and more the term less amount the peo­ple have to pay. It will also de­pend on value of the in­sur­ance: higher the value of in­sur­ance, higher the pre­mium

Chief un­der­writer at life in­sur­ance depart­ment Sabita Lama said that the trend of in­sur­ance cul­ture is im­prov­ing over time and now the peo­ple are more sav­ing-ori­ented.

How­ever, she said that it is chal­leng­ing for them to cre­ate in­sur­ance aware­ness since their prod­ucts are in­tan­gi­ble and sell­ing fu­ture prom­ises.

“Clients don’t come forward since there is in­sur­ance il­lit­er­acy,” she said.

She added that to cre­ate aware­ness on the pol­icy the com­pany has ap­pointed sales ex­ec­u­tives. They con­sist of 60% of the to­tal busi­ness and play a very im­por­tant role.

These sales ex­ec­u­tives are paid com­mis­sion de­pend­ing on the amount of busi­ness they bring to the com­pany.

The lat­est in­sur­ance pol­icy RICB has launched is in­sur­ance on pri­or­ity sec­tor lend­ing.

“We give in­sur­ance to peo­ple who avail the PSL loans. We cover the risk of hu­man life,” Sabita Lama said, “How­ever we are not pay­ing the loan de­faults.”

Of the to­tal num­ber of life pol­icy hold­ers, 60% con­sists of mil­len­nium ed­u­ca­tion and 18% con­sists of money bag as of to­day.

Sim­i­larly the out of the to­tal amount as­sured, 40% con­sists of mil­len­nium ed­u­ca­tion and 18% con­sists of money bag pol­icy.

Now the RICB has also taken over the ru­ral life in­sur­ance. It is pro­vided to all cit­i­zens aged 8 years and above.

For a to­tal pre­mium of Nu 195 the cit­i­zens pay an amount of Nu. 87 and the bal­ance Nu 108 is paid by gov­ern­ment as sub­sidy pre­mium against the sum as­sured Nu 30,000.

For the ru­ral life in­sur­ance, col­lec­tion of pre­mium starts on Septem­ber 1 to Oc­to­ber 31 ev­ery year.

Newspapers in English

Newspapers from Bhutan

© PressReader. All rights reserved.