The IRDA has directed the insurance companies to not to refuse health/medical insurance cover to the senior citizens at least till 65 years of age. The IRDA has communicated to the chief executive officers of all general insurance companies that “all health insurance products filed hereafter must allow entry at least till 65 years of age.”

The IRDA has also notified that the insurance companies will have to give reasons in writing for refusing investment in life insurance. to any senior citizen, and the reasons should be strong enough to “stand scrutiny of reasonableness and fairness”.

The IRDA has also directed that the insurance companies should charge “fair, justified, transparent and duly disclosed upfront” premium for health insurance products, from senior citizens. The insurance regulator has advised the insurance companies to invent a plan to reward policyholders for early entry and continued renewals with the same insurers.

The IRDA communicated that the insurance companies will reimburse at least 50 per cent of the cost incurred by the insured in pre-insurance medical examination, in cases where the risk is accepted. The IRDA said, “This circular shall take effect for all policies issued or renewed on or after July 1, 2009.”

Want to know how to choose between the two? Then read on to know how to go about it in order to get the best insurance for your needs.

Ulips are similar to mutual funds except that they provide life cover, tax benefits and need to be kept for long term.

On the other hand, term insurance is actually insurance where your dependents get sum insured in case you die, but nothing if you outlive the insurance term.

Pros and cons of term plans and Ulips

Both term plans and Ulips do have their benefits and drawbacks. Here are some of them.

Term plan: Pros

* Highest sum assured
* Lowest premium charged
* Can be stopped at the end of premium term, as the life cover exists only for the year for which premium is paid.
* Simple to understand.

Term plan: Cons

* No maturity value as there is no investment component.
* Available only up to 50 years age and the life cover will continue only till 65 years. Also those insurers who offer insurance cover to seniors end up charging very high premium.
* No provision to increase the premium with the increase in income.

Ulips: Pros

* You get returns when the policy matures
* Can increase the premium as per increase in your income.
* Flexibility of investing across various asset classes, thereby helping you maximize returns.
* Long-term investment, helping you inculcate value of savings

Ulips: Cons

* Very high charges
* Nominal insurance cover
* Difficult to compare amongst Ulips from other insurers due to non-standard charges, asset allocation, etc.
* Inability to pay the premium will lead to lapse in policy. Also despite many insurers telling you that paying premium for 3 years is enough, remember mortality charges will be deducted from the corpus invested.
* If the value of the corpus is lesser than the mortality charges due to erosion in the value of the underlying asset, your life cover will stop. Your policy will lapse and you will have to take a fresh policy.

How to decide whether to opt for term insurance or Ulip?

If you need to decide which one to choose, answer these questions:

* Do you have dependents?
* Do you have a liability like a home loan?
* Are you young and want cheap insurance with high life cover?

If you have answered yes to these questions, then term plan is must for you.

On the other hand if you answer yes to these questions, then opt for Ulips:

* Can you afford to pay high premiums till the end of policy term?
* Are you looking for an investment option along with insurance and tax benefits?
* Are you saving towards a particular goal?

Both term plans and Ulips have their pros and cons. Which one is suitable for you will be decided by your personal circumstances. Always take them into account before choosing the right one for you.

Sometimes it is very difficult to change the perception of people for investment in life insurance.

With increasing opportunities for work cropping up worldwide, more and more Indians are opting to migrate to other countries in the search for greener pastures. However, being Indians we still feel the need to stay connected to the place of our birth and therefore, we try to make investments in India through different avenues. Let’s take a look at how Non-Resident Indians (NRIs) can make investments in India.

Can NRIs make investments in India?

NRIs can make investments in all the investments options which are available to Resident Indians. However, Persons of Indian Origin can only make investments in non-agricultural businesses in the country.

Are NRIs allowed to deal in stocks and shares in India?

Yes. NRIs can invest in shares and stocks by:

* Directly subscribing to shares and debentures of Indian companies on a repatriable or non-repatriable basis
* Through the Portfolio Investment Scheme
* Through government securities, certificates and units of UTI through remittances from their domestic accounts or remittances from abroad

What kind of an account does an NRI use to make payments for invesments?

An NRI needs to use a:

* NRE Account (Non-Resident External Rupee Account)
* NRO Account (Non-Resident Ordinary Rupee Account)
* FCNR Account (Foreign Currency Non Resident Account)

What are the 24% and 40% Schemes?

The 24% Scheme allows Indian companies, except those engaged in agricultural activities, to issue up to 24% of their shares and debentures to NRIs with repatriation benefits.

Similarly, the 40% scheme allows for purchase of equity, preference shares and convertible debentures not exceeding 51% of the face value of each issue. Repatriation of upto 40% of the new issue is allowed. Under this scheme, NRIs can invest in new projects or in expansion and diversification projects of existing companies.

What are the investment options available for NRIs?

NRIs can invest in:

* Bank Deposits
* Secondary markets through Portfolio investment in equity shares/convertible debentures
* New issues (shares/convertible debentures)
* Non convertible debentures
* Mutual funds provided that amount is invested out of NRE/FCNR/NRO account or by inward remittance
* Domestic (NRO) funds through deposits in Indian companies (including Non Banking Finance Companies if they are registered with Reserve Bank of India) on non repatriation basis upto 3 years subject to certain formalities to be completed by the concerned company
* Bonds provided that amount is invested out of NRE/FCNR/NRO account or by inward remittance
* Proprietary or partnership concern in India
* Immovable property provided that the amount is not invested for the purchase of agricultural land, plantation property or farm house and investments are made from fresh inward remittance or existing non resident account

What are the different tax benefits available to NRIs?

* Bank Deposits investment in shares, units of Mutual Funds etc. are exempt from wealth tax in India
* Interest earned on NRE and FCNR accounts is completely tax-free
* Gift tax has been abolished for all types of gifts from the 1st October 1998
* However, gifts received on the occasion of marriage or from relative or under will or inheritance would not be subject to tax

source:http://www.bankbazaar.com

Over the last couple of decades, I’ve seen a variety of panic-fuelled stampedes in the stock markets, but the severest ones have always been for the exit to avoid losses. I’d never expected that the worst stampede I would ever see would be in the other direction – that of investors trying to buy stocks at any cost.

Behavioural investing tells us that investors are risk-averse and react far more strongly to the prospect of making losses rather than making profits. Last Monday was probably proof that there are mysteries to people’s behaviour that will never be understood. The phrase ‘panic buying‘ is often used, but what we saw on that day was its one true demonstration. Now, I really know what a buying panic looks like and shall never use the phrase in vain. However, that doesn’t make the phenomenon any easier to understand.

When there’s panic selling in a market, it’s because traders want to sell a stock at any price so as to avoid a loss. But what is a buying panic? Are traders are buying because stocks will never again be available? Perhaps.

The most charitable explanation was that it was actually driven by short-sellers trying to avoid a loss. While investors were waiting for the illusory ‘post-election dip’ to buy stocks, plenty of speculative short-term traders had taken that dip as a given and had sold stocks. After seeing the election results on Saturday, these people lined up on Monday morning to buy stocks at any price.

It is also one type of investment in slow down for investors. What u say?? Large investors were waiting for this type of opportunity.

While all these developments have made debt instruments reasonably attractive, one should take decisions depending on one’s investment horizon and liquidity needs. For example, investors in the highest tax bracket can consider investing in short-term debt funds. But do look at the liquidity risk and interest rate risk. On the other hand, for investors in lower tax brackets, FD investments should be the preferred avenue.

Where do debt funds invest?

Less than one year
Commercial Papers: They are short-term papers issued by companies to cover their short-term borrowing requirements. The risk is quite low due to a lower tenure. Short-term debt funds invest in these papers.

Certificates of deposits: It is the same as a commercial paper, except that these are issued by banks. Usually, short-term funds or FMPs invest in these papers.

Collateralised borrowing and lending obligation (CBLO): This is basically an overnight window, which is offered by the Clearing Corporation of India. Funds invest here only for a day or two. This facility is used by liquid funds.

Treasury Bills (T-Bills): They are issued by the Government of India and usually have tenures of 90, 182 and 364 days. They are extremely safe as they carry a sovereign guarantee. Again, short-term debt funds invest in these securities.

One year and above

Corporate Bonds: These are bonds issued by PSUs and are rated by credit rating agencies. Medium-term and long-term debt funds usually invest in them.

Debentures: Issued by Indian companies, these bonds are also rated and medium and long-term bond funds invest in them as in accordance with their investment mandates.

Securitised paper (Pass through certificates): These are papers issued by banks securitising a loan that they have offered to a single corporate entity. Longand medium-term bond funds invest in these certificates.

Government bonds (Gilts): These are bonds issued by the government of India and carry sovereign guarantee; hence, they are highly safe. There are special gilt funds that invest in the government bonds.It is the safe investment in India.

source:http://businesstoday.intoday.in

Scared of the volatility in stock markets? Bored of the bank FDs, insurance and other traditional debt products? Looking for other innovative investment options that provide high returns? Have you given a thought to Art? Don’t be surprised. While art is pleasant to your taste buds, it can also help you earn good returns. Today, art has become a popular investment option amongst the rich and high net worth individuals. Let us discuss this new investment option and if it is for you.

Investment in art can be done either by purchasing the artwork done by reputed artists like M. F. Hussain, Anjolie Ela Menon and Akbar Padamsee or investing in an art fund. The major investors in direct art include museums, private collectors, art galleries and curators. In the developed markets, the trend starts with the museums, followed by private art organizations, private collectors and ultimately the commercial art organizations. However in emerging markets like India, the trend is reversed. Here the commercial art organizations are at the top, and followed by private collectors, with public art organizations like museums being at the bottom. As a result, the prices of art are decided more on the basis of sentiments and perception than the actual auction prices.

This has been due to low levels of education prevalent in these markets and absence of commitment to the artists from the galleries. However with the recent crisis affecting all markets and the sharp rise in prices of the artworks by reputed artists, even art markets have not been spared. They are also witnessing a slow down and there is no guarantee which way the markets will move in the future.

But despite the slowdown in the art markets, there has been a tremendous demand for artwork from the various art collectors, both personal and commercial. As a result, many new artists are entering the art market. They are holding exhibitions in various art galleries to showcase their talents. These exhibitions are well attended by many art lovers and the response has been tremendous.

So now are you sufficiently intrigued? Do you want to know how to buy an artwork?

For one, to buy an artwork, you can visit the auction houses, where the artworks are being bid and start bidding on the artwork of your choice. It will allow you to buy the artwork of your choice at your price. However the problem here is that since the highest bidder gets to keep the item, you may not win the item. This leaves you with another option: purchase at an art gallery. There are many art galleries, both online and offline where you can buy the items of art. They also help you in selling the artwork, if you are looking to sell artwork for cash. Alternately there are art exchanges, where you can trade your current artwork with others.

However remember as these art objects are regarded as investments, they would attract a capital gains tax. If they are sold before 3 years, they attract a short term capital gains tax, whose rate and if it is sold after 3 years, you have to pay a long term capital gains tax at the rate of 10%. This makes this type of investment expensive for tax payers falling in the higher tax bracket, as their tax liability goes up.

Investing directly in art has its own drawbacks. For one, these artworks need to be protected against theft and damage. Second, you need to have large sums of money to buy these works. Third, they occupy a lot of space. So for those looking to invest in art but have money and space constraints, there are art funds available, where you can pool your money along with other investors and invest in art. Some reputed art funds operating in India are Osian’s Yatra and Indian Fine Art Fund.

Indian Fine Art Fund is a 5 year closed-ended fund, with a minimum investment of Rs. 40 lakh. It is established by Phillip Hoffman, who also set up the The Fine Art Fund Group, based in UK. It allows Indians, both resident and non-resident and non-Indians to invest in Indian art.

However remember, art investment is a long term investment, due to high charges like commission, VAT and capital gains tax. Moreover, they invest in the art works by famous Indian artists, whose works are already very expensive. So all these charges add up and affect the final returns generated by your investment. Also ensure you always invest with funds registered with SEBI to avoid being swindled by unscrupulous funds.

Isn’t it a long term safe investment during volatile?

This time people like to inevst in companies where they can trust the managements and where they like the businesses. So they should go for buying mutual funds :in my view if they have trust on the company management.

About PSU Investment:There is underlying value in many PSU companies like ONGC However, this value can only be unlocked if the governement and the bureaucracy does not interfere with the daily running of the companies. These stocks may not move for years but they can have a sharp upward movement if their CEOs are given true independence. SO u can decide from this.If you want constant and steady income (not growth) you should go for this according to me.

What u will suggest other readers??

So now people will invest more time to know where to invest. Whether in equity,insurance or any other field. People will prefer Safe Investments During Volatile Market Times.

But according to me I should go for mix up with risk and safe zone.

According to u what should be the strategy?