Money For Investment - Seite 2 
8THINGS TO HELP GET FASTER CLAIM UNDER MEDICLAIM POLICY
Its not uncommon to find people among us who have suffered at the hands of the mediclaim insurers during claim settlement. There are numerous instances where claim is rejected by the health insurance company on technical/material grounds. This defeats the basis purpose of getting help when needed. So, what can you do to avoid this? Try these steps :- 1. Check Fine Print for Expense Coverage - The mediclaim polices generally list down the limit of expenditure that is allowed to reimbursed under room rent/ambulance hire charges etc. This limit varies between policies of various companies and hence before you get yourself admitted to any hospital , it is always advisable to check the expense limit allowed as per your mediclaim .Any extra expenditure done on account of thee heads is generally borne by the patient himself/herself. 2. Check for exclusion in Diseases - You must also check the number and nature of diseases covered under your mediclaim before you buy it. For example, lot of policies in India dont cover Diabetes at all . This is a major exclusion since Diabetes is very common among Indians and by excluding it the insurer is playing safe. You must select the policy which provides coverage for maximum number of diseases especially the critical one like Diabetes, Heart related, Kidney Related, cancer related etc. 3. Time Period Before Coverage of Preexisting Disease- Most of the mediclaim policies in India, have a waiting period of anywhere between 1 to 4 years before they cover preexisting diseases.Any claim made for the preexisting disease during the waiting period is likely to be rejected.Hence go for the plan which has least waiting period. 4. Plastic Surgery , Cataract, Dental Care and Piles Not Covered - Most of the mediclaim policies in India DONOT cover Dental Care, Piles, Cataract etc . Even Plastic Surgery is considered to be part of cosmetic surgery and as such is seldom covered under mediclaim. . 5. OPD Not Covered - Any claim that you may have on account of expenses towards medicines /Doctor consultancy Charges etc during OPD care is not covered by most of the mediclaim plan in India. 6. Disclose all Material Info - To avoid rejection of any claim made by you which is normally covered under the plan, it is also important for you to have disclosed all material information to the insurer while applying/buying the cover. If the firm finds out that you have willingly suppressed an information which is material in nature, then they are well withing their rights to reject the claim. So be truthful and disclose all the relevant (good and bad) information. It might increase your premium but will ensure that your claim is not rejected when you need the assistance the most. 7. 24 Hr Hospitalization - One needs to be hospitalised for a minimum of 24 hours before your claim is eligible for reimbursement/payment by the insurer. Only exception is Chemotherapy,radiation treatment done in Cancer where 24 hr hospitalisation isnt mandatory. 8. Submit your Claim ASAP - Any claim submitted beyond the stipulated timeframe by the insurer might lead to its rejection . It is advisable to submit claims within 7 days of getting discharged from the hospital.
After stupendous success of mobile number portability introduced by TRAI , IRDA too has taken a cue and introduced health insurance portability in India from 1st October 2011. This is a huge step in the right direction considering there was lot of discontentment among the consumers about the manner in which they were being treated by their health insurers. Some of the common grouses were: 1. The health insurance companies mandated on a waiting period for covering pre existing diseases to each and every customer once he comes in their fold, irrespective of whether or not the person had any other policy where he had served out the waiting period. So in effect , every time you changed the company , you would have had to start the waiting period all over again.2. The insurers generally were resorting to increasing the renewal premium by a steep margin for those policyholders who have had a claim in the year. This was mostly done to discourage the policyholders from renewing the policy with them. Thus they wanted to get rid of policyholders who they thought could be "claim prone".3.In lot of cases, policyholder's request for renewal after a claim was rejected without any material reason from the insurer. This meant a great nuisance for the policyholder since he had to start his waiting period for preexisting disease all over again with the new insurer. To address some of these issues , IRDA has mandated health insurance portability now. What exactly does it mean?Health Insurance Portability means that a health insurance policyholder can now choose to change his insurance provider without foregoing any of the benefits covered in his/her current policy. For instance, if you have a health insurance/mediclaim plan from ICICI Lombard and if for any reason you are not happy with the company , then you can change over to any other insurance provider without foregoing any benefit that you may be enjoying under your current plan. What are the benefits of Health Insurance Portability? Following are the few of the benefits:1. CHOICE - Now as a policyholder , you will have a choice which till now you didn't have. You can now switch over to any health insurance provider . 2. COVERAGE OF PREEXISTING DISEASES - Once you move from one general insurance company to another for their health insurance or mediclaim plan, you will continue to get the same benefit that you got in your old plan.For example , if you were covered for Diabetes in Plan A and then you migrated to Plan B , then in the Plan B too , you will have that covered. 3. NO FRESH WAITING PERIOD - Once you change over to new insurance provider, you need not start your waiting period for getting preexisting diseases covered all over again. You will have the benefit of counting the number of years you waited in your earlier plan .For example, if the waiting period for covering Diabetes under the Plan A is 4 years and after 2 years you migrated to Plan B from another company where also the waiting period for covering Diabetes is 4 years, then you will have to serve waiting period of only 2 years with Plan B since you have already served 2 years under Plan A. This is a big change for all the policyholders.4. NO CLAIM BONUS TOO TO BE PAID - If you had claim free year in your first policy , then on switching over to new policy , you will be entitled to no claim bonus too from the new insurance provider . How to Change the Policy or Insurance Provider in India? You will have to do following :-1. Apply with the insurance company you wish to change to , at least 45 days prior to your current policy getting over.2. Inform the IRDA too about the insurance firm you wish to change to. What else should you consider before switching over?Consider the following before you finally sign on the switch application a. Check for the new premium rates being charged by the other insurance companies for similar coverage in terms of Sum assured and diseases covered.b. Check for the network of hospitals that they have under cashless scheme.The more the merrier.c.Also check claim settlement ratio of the firms. The company which doesn't have good record in settling the claims does not merit a chance. You should go with the firm which has good claim settlement ration, great hospital network and reasonable premium.So its time to pull out your mediclaim policy documents and check if it needs to be from another company . Stay wise and happy investing!!
TOP 5 TAX SAVING FIXED DEPOSIT (FD)
Tax saving FDs offered by banks in India are good option for someone looking to save tax under Sec 80 C without taking any risk that is inherent in equity exposure that ELSS offers. So, if you are one of those conservative investors who want to save tax via FDs , then it would be pertinent to know which banks are offering you the best deal currently. Following are the 5 best Tax saving FDs that are being currently on offer ( as on Sept 11). Rank Bank Rate On Int.(p.a.) Rs 10000 will grow 1. Tamilnad Mercantile Bank 10% Rs16386. 2. City Union Bank 9.75% Rs 16186 3. IDBI Bank 9.50% Rs 15991 4. Punjab And Sind Bank 9.50% Rs 15991 5. State Bank of Travancore 9.50% Rs 15991 Happy investing!!
BANK CASH TRANSACTION FROM MOBILE PHONE
There have been times , when we have been faced with situation of transferring money from bank account to another account without visiting bank branch. One can do cash transactions via netbanking if one doesnt want to visit the branch or the branch timings are over. But what if we in a place where internet isnt available and we need to transfer cash immediately . Relax, we have a solution now. Resereve Bank Of India has now allowed cash transaction upto Rs 50000 from mobile phones . To do so , we need to follow the following steps:- 1. Register with the bank for interbank Mobile Payment Service (IMPS). 2. Download the application on the mobile phone. 3. Log in to the application 4. Select bank account from which funds are to be transferred. 5. Select mobile money transfer service. 6. Enter 10 digit mobile number, 7 digit MMID and desired amount to be transferred. 7. Confirm all the details. 8. Done. You will recieve sms confirming the same. PROS OF THE FACILITY 1. Another platform to do non branch based cash transaction besides netbanking . 2. Ease of operation is huge since we are all with our mobuile phones virtually at all times. 3. Increased penetration of banking services in underbanked areas where bank branches arent available. CONS OF THE FACILITY 1. Cash transactions of upto Rs 50000 only can be done via this platform as of now. 2. Traning could be an issue for rural folk who are very tech savvy.
WANT TO INVEST IN GOLD??
"The desire for gold is the most universal and deeply rooted commercial instinct of the human race." Gerald M. Loeb The above mentioned adage perfectly sums up the love investors have showered on the precious metal since times immemorial. This metal has retained its numero uno pisition as the "Metal of choice" over centuries. So what really makes this metal so desirable inspite of its very limited medicinal or industrial usage? Following are just the few of many reasons responsible for the same : 1. Its widespread use in Jewellery - It has always been used a metal of choice when it comes to Jewellery. In India, for instance, most of the gold demand is on account on Jewellery .This demand for gold jewellery has made India one of the leading countries as far as gold consumption is concerned. 2. It was used as Currency - Gold emerged as a major currency very early during human civilization where kings across continents used gold coins as currency in their respective kingdoms. It was also used as base for new "paper currency" which sovereign governments printed , till very recently. It is still considered as hedge against dollar , the world's reserve currency. 3.Excellent hedge against inflation - Investors flock to gold because it has been proven beyond doubt that it is the best asset class which provides hedge against inflation . Gold investment protects the purchasing power of your investment/portfolio. HOW TO INVEST IN GOLD? Now, if you are wondering how does one invest in gold , then you may want to explore following 3 options: 1. Investment in Gold Mining Funds - You can invest in funds that invest in gold mining funds such as AIG World Gold and DSPBR World Gold Fund. This option will help you own the world's gold reserves and hence as and when gold as an asset class does well, these mining firms will do well and consequently , you as an investor will do well. 2. Gold ETFs - Next, you can invest in paper gold through gold exchange traded fund (ETF), wherein you buy the gold units from the stock exchange for which you need a demat account to buy and sell the units on the stock exchange. 3. Gold Fund of Funds - And more recently, you have the option of investing in a gold fund of fund, such as Reliance Gold Savings, Kotak Gold and SBI Gold fund, which are all passively managed fund of fund that invests in the open-ended Gold Exchange Traded Fund of their fund houses, which in turn invests in physical gold with 99.5 per cent purity. This structure is convenient for those who do not have a Demat account and want to start a systematic investment plan in gold. Depending on your convenience and investment needs; you can consider any of the options to invest in gold. Amongst the investing option; ETFs and gold funds should be better for the liquidity they offer and the fact that these invest into physical gold, their value will be closest to that of gold.
PRECAUTIONS TO TAKE WITH YOUR CHEQUEBOOK
We all use our cheque leaves while making payments to various parties/paying bills etc , but, have we ever wondered what all can go wrong with these cheque leaves? There have been numerous cases of fraud , where the modus operandi has been misuse of the cheque leaf. Hence it is imperative to know ,first, what all can go wrong and then what safeguards to take with your cheque leaves.What Can Go Wrong?1. Cheque can be misused - Lot of fraudsters tamper with the cheque which one writes by adding a name of account number , making alteration, adding digits etc and then countersigning on it. This way they loot the unsuspecting guy , his hard earned money.2. Cheque can be assigned - Since cheques are negotiable instruments , it can be assigned from one person to another and as such , one can simply cut the beneficiary name and assign the cheque in ones own name and then bank it with his own banker. This was he wont have to forge the drawers signature. He simply will have to sign for the beneficiary and since the beneficiary's account may not be with the presenting bank /accepting bank , it is difficult to spot the fraud. But thankfully only few cooperative banks do accept cheques which are "assigned to third party".What safeguards to take?1. Always keep chequebook in safe custody - This is the most basic precaution that one must take. Safe custody of the cheque book will ensure that it does not reach in rogue element's hands easily and thus the chances of its misuse is that much lesser.2. Always give "Account Payee" cheque - Wherever possible avoid giving "Self" or "Bearer" cheques since that opens up lot of possibility of fraud. Anyone with that cheque can go to any branch and get that encashed since it is an open cheque drawn in favour of the presenting party without mentioning its name. So avoid it.3. Always write the name of beneficiary - Always mention the name of the beneficiary to whom the cheque is being issued. This will enable the bank to cheque Identity details of the presenter in case of any doubt etc. Also as a prudent banking practise, banks do check ID proof before giving large value cash withdrawals to unknown person. So a name on the cheque rather than just"Self" or " bearer" would help.4. Never leave Blank spaces in the cheque leaf - Always try to use the full space of the cheque without leaving any space which may be used later for adding name or account number etc. You may cancel the empty space by striking it with a line .5. Dont hand over PDCs to sales executives - In lot of fraud cases, Sales executives from Bank DSAs collect PDCs from the customer even before the loan is disbursed/or is about to be disbursed. These cheques then are used by the executives to siphon off the funds from the customers account. Hence, avoid giving PDCs to executive, you must give it to the branch or loan disbursal centre with proper acknowledgement. Also never give cheque without any beneficiary details (lot of people do it) since execs tell them that they will fill that portion later. The same portion may be used by execs to write their own name and thus they are able to withdraw amount from unsuspecting customers.If you follow these basic guidelines, then I am sure you will be able to stay out of these fraudsters who are out to make quick buck at your expense.
Budget 2011-12 - What is in it for tax payers??
Well like every year , this year too 28th Feb 11 was one of the most awaited days of the year. Everybody was waiting to see what our beloved FM dishes out to common taxpayers via his budget for FY11-12. The budget overall hasn't done much to enthuse common man. There are no major tax breaks for majority of the junta . But, he has done few things which we need to take note of :-1. Increased tax exemption limit for male to Rs 1.8 Lakhs : The tax exemption limit has been increased by Rs 20000 from 1.6 Lacs last year to 1.8 Lacs this year. This is only for males as the tax exemption limit for female taxpayers is already at 1.9 lacs. The additional relief will save 2000 rupees for everyone who falls in ta bracket. Small relief, but, relief nonetheless.2. No need to file ITR for salaried people: Pranab Da has also mandated that those salaried people whose annual income is less than Rs 5 lacs/annum need not file ITR separately. The same will be done by their company. They can decalrae their additional income like FD interest income etc to the employer who will accordingly deduct TDS and file return.3. No Tax till Rs 5 lac income for Very Senior Citizen: In an unprecedented move, Finance Minister has introduced an absolutely new segment in the income tax viz that of Very Senior Citizen. All those taxpayers who are above 80 years of age will be classified as very senior citizen and they wont have to pay any tax till the annual income of RS 5 lacs. This is a huge step taken for welfare of very senior citizens since in India, we dont have any social security and older people have to spend considerably on medical care and as such this was required. Here is thumbs up to Mr FM for doing this. 4. Tax Relief under Infrastructure Bond Investment Extended : The Tax relief offered on investing upto Rs 20000 in infrastructure bonds like IDBI, L&T etc which was introduced in FY10-11 has been enxtended for FY11-12 too. So taxpayers can continue to invest in this and save taxes upto Rs6180 under this option.Besides, these there is nothing much to cheer about for normal taxpayer in this years budget. However, with DTC proposed to be launched in FY12-13, things will be much better and simpler for all taxpayers.I only hope that Mr FM is able to deliver on his promise of making DTC operational from 1st April 2012. More Power to you Mr. FM.!!
INFRASTRUCTURE TAX SAVINGS BONDS - SHOULD YOU INVEST??
January to March is that time of the year when most of us are rushing towards making our mandatory"tax saving investments". While we are all well versed with tax saving options available to us under section 80CC, but, this financial year government has offered us another option where we can invest in infrastructure bonds and save taxes. Here, an investor can invest upto maximum of Rs 20000 which can be claimed as deduction from his taxable income. This is over and above RS 1 lac that you can save under Sec 80 C. SO question to ask is should you and I invest in it?Lets first examine the pros of this option1. Additional tax saving of Rs 6600 if you are under 30% tax bracket.Other than the above mentioned benefit , there isn't any other major benefit associated with investing in these bonds.Now , lets look at cons too1. High lock in period - Most of these bonds are of 10 year tenure where minimum lockin is of 5 years and then these bonds will be listed on exchanges where you can sell it provided you find a buyer.2. Modest post tax returns - The returns offered by these bonds are between 7-8% which is modest at best considering the high lockin. Should you invest?The short answer to this is no if you are a savvy investor since the lockin is high and the returns are nothing to rave about.So what should you do ?One can always invest this money in equity or well diversified mututal fund which will surely give better returns in 5-10 years , besides offering liquidity which these bonds don't offer. Always remember that any "tax saving investment" first MUST qualify as GOOD INVESTMENT and then if it helps save you tax then it is even better , but never, invest in any policy/plan or bond just because it helps you save tax.Happy investing!!
IPO INVESTING IN PSU - GOOD WAY OF MAKING MONEY IN STOCK MARKETS
I have always stayed away from directly getting into equity markets. This was inspite of my firm belief that equity is the best asset class to invest in if one intends to make money over long period of time. The reason why I stayed away was my inability to devote enough time to research the stocks before investing and hence I always relied on Mutual Funds for equity investing. But, I always had this urge of making quick buck in equity markets. The most popular mode of short term investing in stock markets in via trading either intra day or for few days trades. But IPO investing for listing gains can be a great opportunity for common people to make money in stock markets in India. This I can talk from my own experience of investing in CIL IPO. For retail investors there was money to be made in this IPO and I personally made About RS 19000 in this IPO on an investment of Rs 46000. That's cool 46% in less than a month's time. This extra 19000 could be used to pay off my electricity bill, maid -driver salary , petrol bills etc for a month. Not a bad deal. So why is this such a good deal to invest in IPO of PSUs?1. Attractive Pricing by Government - Since the Central government at helm of affairs is one which espouses "inclusive growth" , they have made a conscious decision to price the IPOs at very attractive price point leaving some money on the table for investors. This gives you enough headroom to account for any volatility on negative side on the day of listing.2. 5% discount for retail investors- Any investment in IPO or FPO by retail investors makes them eligible for a discount of 5% on the issuance price and as such the retail investors get an additional 5% margin on listing. So ,theoretically, even if the said stock was to list on the issuing price only,retail investors will still make 5% gain on listing. So minimum 5 Guaranteed on listing atleast on the issue price in a months time. Thats not bad money considering one gets at the most 8% returns in bank deposits over 12 months.3. Most of PSUs enjoy near monopoly status- One of the most important aspects to consider in a company before investing in it is its level of dominance or market share in the industry in which it operates. Warren Bufett says that the best company to invest in is a company enjoying monopoly . While monopoly is an elusive thing in today's globalised world, we still have lot of sectors which are not open to private sector and there the PSUs have almost a complete monopoly and as such they enjoy huge advantage over other companies in terms of potential for growth and profitability. Coal India is a point in case. Hence investing in good PSUs is an ideal thing to do. The mood in the current govt is to continue with disinvestment program to meet their fiscal deficit and as such we as an investor will keep getting good opportunities to participate in the disinvestment program both for short term gains and long term wealth accumulation. So , if you want to make quick money then invest in good IPOs of PSU and sell on listing and if you want to build good portfolio for long term wealth building, then hold on to these stocks which will become multibaggers in time to GOOD PSU stocks . All PSU stocks may not give you same results. Happy investing!!
Why IRDA v/s SEBI hasnt gone in your favour???
Those of us who are in India, we have been inundated with news of tussle between SEBI and IRDA to control/regulate the ULIPS launched by insurance firms. The SEBI's contention was that since ULIPS are primarily a MF in the garb of insurance plan with huge upfront charges, SEBI should have right over regulating that product, while IRDA position was that since ULIP is an insurance product it will be regulated by IRDA. This dispute was also referred to court,but, finally the finance minister intervened in favour of IRDA. So, it is settled now, IRDA is the regulator who will regulate ULIPS. So what does this mean for an average investor like you and me?? Is it good or bad?? The answer is both, good and bad. Let us see why IT IS GOOD BECAUSE1. ULIPS to become relatively a cost effective saving tool- My displeasure over ULIPS as an investment product is well known to the readers of this blog. I feel they are one of the worst products that one can invest in.The reason is its atrociously high charges which can be upto 50-80% of your premiums for first few years. But, now the situation is likely to get better after Sept 2010. The IRDA has mandated that charges be brought down and also should be evenly spread over the tenure rather than being just front loaded as it is now. SO the ULIPS as a product will RELATIVELY become better than its earlier AVATAAR.S o in case you like ULIPS and want to invest only in them, then this is good news for you.2. The lockin to go upto at least 5 years-IRDA has also mandated that minimum lockin should be 5 years atleast than 3 years currently in vogue. This will ensure that people are stay put in the plan for a longer duration and are able to reap the benefits of long term investing. It will also reduce chances of agents misselling this product as "3 year" saving tool.3. Charges to be uniformly distributed - Charges will now be equitably distributed over the term of the plan rather than being front loaded. This will ensure that even if one is surrendering the policy early he isnt heavily penalised because of charges.4.No charges on policy surrender- Currently on surrendering the insurance policy in 3- 4 years time, one does not get anything or if you get then that is close to nothing . This is due to prohibitive charges and upfront commission that companies pay out of your premium. But this will change as now no longer companies can charge any fee on surrendering the plan. This is likely to be effective Sept 2010.IT IS BAD BECAUSE1. It is still a ULIP which will still have charges which may be lower than ULIPS current charges but will still be manifold higher than MF charges. They will still be one of the worst products to invest in.2. With SEBI as regulator, things like high commission etc would have gone and that would have brought charge structure to MF levels and then ULIP would have been a really good product offering you the twin benefits of insurance and MF at a very effective rate. In the end, I think the FInance Minister's decision is not really in the right interest of an average investor who wants to invest in a saving tool which gives maximum appreciation head room with minimum possible charges/fees.