Category: Personal Finance

Will Gold Prices Fall Soon As US Fed Announces Tapering Timeline?

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Personal Finance

oi-Kuntala Sarkar

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Gold prices in India depend on the international price trends, measuring factors such as US dollar index and US interest rates. Yesterday, on Friday, US Federal Reserve (Fed) Chair Jerome Powell said that they might start to reduce the monthly bond purchases programme, later this year, but will not rush to hike the interest rates now. As gold is traded against the US dollar, this announcement is going to leave significant impacts on the yellow metal’s prices. When the US Fed will start tapering later this year, it is expected that the interest rate might increase after the tapering, that is in early 2022. Hence, the end of 2021 is no more anticipating a stiff rise in gold rates, as expected before.

Will Gold Prices Fall Soon As US Fed Announces Tapering Timeline?

Why the prices might drop?

Spot gold prices till Aug 27, in the international market, was standing at a $1816.80/oz level and COMEX price was quoted at a $1,819.5s range. In India, 22 carat gold was last quoted at Rs. 4662 per gram. As the Fed Chair Powell announced the possible tapering time, the small rally in gold could end. A similar trend can be found with silver. Spot gold and silver prices might perform moderately, but future rates will be affected. With an interest rate hike, the government bond yield will rise and investors will focus on the US dollar, in addition to government bonds. This will eventually shift their concentration from gold, dragging the precious metal’s prices down, globally.

Fed’s quantitative easing (QE) policy

Due to the pandemic, the US Fed earlier was maintaining a position of quantitative easing (QE) with a US$120 billion-a-month bond-buying programme, to flood the economy with liquidity. But now, as the labour market and housing market data show the economy is gaining pace, which is giving the Fed strength to taper the asset-buying programme. The country’s labour market added 943,000 jobs in July, while the unemployment rate fell to 5.4%. July, month-on-month housing sales data showed positive results, above market expectations. Now, the Fed is ready to focus on its currency index to grow, which will drop down gold rates.

India is one of the largest consumers of gold, globally, and the RBI has purchased a record amount of gold in the recent past to store in its reserve. For the common people, to buy gold, they have to pay the basic gold prices as the Indian Bullion Jewellers Association (IBJA) fixes daily, considering the global rates, along with additional GST. Indians have to pay import duty and cess as gold is mostly imported from foreign markets. As the prices are expected to fall in the international, this will drag down gold prices in India giving more scope to common people to buy the yellow metal. If the gold rates are falling now, an investor who is planning to stay put in the long term, should not worry. Gold always performs well in the long term. When the gold rates are down in the market, it is recommended to invest. Also, a 15-20% gold investment helps an investor to diversify the portfolio, thereby mitigating market risks and keeping a hedge against inflation.

Story first published: Saturday, August 28, 2021, 14:09 [IST]



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Sebi slaps Rs 50 lakh fine on Kotak Mahindra AMC; bars from launching new FMP schemes for 6 months, BFSI News, ET BFSI

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Sebi on Friday imposed a penalty of Rs 50 lakh on Kotak Mahindra Asset Management Company (AMC) and barred the fund house from launching new fixed maturity plan (FMP) scheme for six months for violating regulatory norms.

The markets regulator has directed the fund house to refund a part of the investment management and advisory fees collected from the unitholders of the six FMP schemes along with a simple interest at the rate of 15 per cent per annum.

In a statement, a spokesperson of Kotak Mahindra Group said that all the investors have been fully repaid along with applicable interest in September 2019 and the fund house is committed to protecting investor interest at all times.

The case pertains to six FMP schemes that matured in April and May 2019, which held investments in Non-Convertible Debentures (NCDs) issued by Edisons Utility Works Pvt Ltd and Konti Infrapower & Multiventures Pvt Ltd, belonging to the Essel Group and secured by pledge of equity shares of Zee Entertainment Enterprises Ltd.

Sebi found lapses on part of Kotak Mahindra AMC in carrying out due diligence and laid back approach adopted by the fund house in risk assessment while taking investment decision vis-a-vis the Zero Coupon Non-Convertible Debentures (ZCNCDs) of Essel Group entities.

The fund house has not analysed various risk parameters — credit risk, liquidity and interest rate risk etc — while evaluating the proposal to invest in the ZCNCDs of “certain insignificant and financially handicapped entities” of Essel Group such as Konti Infrapower & Multiventures and Edison Utility Works, it said.

Further, the events that took place involving the shares of ZEEL and the Essel Group from January 25, 2019 onwards clearly suggest that there were strong possibilities of default on the part of the two issuer companies to honour the redemption of the ZCNCDs on their maturities, an event which was prevented by the fund house by extending maturity dates of these ZCNCDs.

“Utter neglect of due diligence, inordinate delay in communicating with the investors, violation of the statutory sanctity of the maturity dates of the FMP schemes, permitting extension of the maturity of the ZCNCDs of the issuers in contravention of extant regulations etc, there remains no doubt in mind that the noticee has acted in gross violation of provisions of the Sebi Act, 1992, MF Regulations, 1996 as well as various circulars issued by Sebi from time to time,” Sebi said in its 84-page order.

It further said that the fund house failed to exercise due diligence and failed to disclose information about negative impact on the six FMP schemes to its investors on time.

Accordingly, Sebi has imposed a monetary penalty of Rs 50 lakh on the fund house and also restrained it from launching any new FMP scheme for a period of six months.

“The noticee (Kotak Mahindra AMC) shall refund a part of the investment management and advisory fees collected from the unitholders of the six FMP schemes, equivalent to the percentage of exposure to the ZCNCDs of the issuers in the respective schemes as on the date of maturity of the six FMP schemes,” Sebi said.

The refund is along with a simple interest at the rate of 15 per cent per annum from the date of maturity of such schemes till the date of actual payment to the respective unitholders of the said schemes, it added.

The regulator has directed to complete the exercise of payment of funds to the respective unitholders within a period of 45 days.

The order came after Sebi noticed that the investors of certain FMPs launched by the Kotak Mahindra Mutual Fund were not paid their full proceeds based on the declared Net Asset Value (NAV) of the said schemes as on their respective maturity dates.

Upon noticing the same, Sebi noted that Kotak Mahindra AMC had launched two FMPs as close ended debt schemes during November 2013 and December 2015 both of which were scheduled to mature in April 2019. These FMPs had invested in ZCNCDs of Konti and Edison.

In addition, the fund house in its made submissions to Sebi revealed that it had also subscribed to the ZCNCDs of the same issuers from four FMP schemes.

In all six schemes, the fund house had permitted the issuers to extend the maturity period of those ZCNCDs till September 30, 2019. PTI SP MKJ



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Centre unveils series VI Sovereign Gold Bond Scheme; Rs 50 discount for investors who apply online, BFSI News, ET BFSI

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The Reserve Bank of India (RBI) has announced the Sovereign Gold Bond Scheme 2021-22 Series VI, which will be open for subscription for the period August 30-September 3, 2021.

The nominal value of the bond based on the simple average closing price for gold of 999 purity of the last three business days of the week preceding the subscription period works out to Rs 4,732 per gram of gold.

The Centre in consultation with the RBI has decided to offer a discount of ₹50/- per gram less than the nominal value to those investors applying online and the payment against the application is made through digital mode. For such investors, the issue price of Gold Bond will be Rs 4,682 per gram of gold.

Sovereign Gold Bonds are government securities denominated in grams of Gold and issued by the Reserve Bank of India on behalf of the government as a replacement for owning physical Gold. The bonds are sold through banks, Stock Holding Corporation of India Limited (SHCIL), designated post offices, and recognized stock exchanges like NSE and BSE.

A total of Rs 25,702 crore has been raised through the SGB Scheme since its inception till end-March, 2021. The Reserve Bank had issued 12 tranches of SGB for an aggregate amount of Rs 16,049 crore (32.35 tonnes) during 2020-21.



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Union Finance Minister Nirmala Sitharaman inaugurated 12 developmental projects in Tripura, BFSI News, ET BFSI

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Union Finance Minister Nirmala Sitharaman inaugurated 12 developmental projects in Tripura. She reviewed the progress of Externally Aided Projects (EAP) worth Rs 7,719 crore.

The finance minister is on a two-day visit to Tripura. The state is implementing EAPs in the afforestation and livelihood, power transmission, water supply sectors and infrastructure development.

Tripura chief minister Biplab Kumar Deb tweeted, “Attended the Externally Aided Project’s review meeting with FM Smt. @nsitharaman Ji Deputy CM @Jishnu_Devvarma & other officials were present on the occasion These EAPs are important for the holistic development of the state and the betterment of the livelihood of its citizens”.

Tripura Chief Secretary Kumar Alok the finance minister reviewed the EAPs and appreciated the pace of implementation. Tripura might get more EAPs.

The finance minister inaugurated Rs 38.03 crore World Bank aided 132 KV electric sub-station besides Rs 20 crore worth three Surface Water Treatment plants funded by Asian Development Bank.

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FM promises Rs 1,300 crore development package for Tripura tribal areas, BFSI News, ET BFSI

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Union Finance Minister Nirmala Sitharaman on Friday promised that a Rs 1300-crore project for Sustainable Development and Infrastructure Development for Tripura‘s Tribal areas would be cleared within the next 10 days.

Addressing a meeting after inaugurating a slew of 11 projects at Mohanpur, about 50 km from here, Sitharaman said the Rs. 1300-crore project with World Bank funding would ensure an all-round development in the state’s tribal areas.

Tribals form one third of the state’s population. In recent elections to the Tripura Tribal Areas Autonomous District Council, the ruling BJP and its allies were trounced by the newly formed Tipraha Indigenous Progressive Regional Alliance led by a former royal, Pradyot Kishore Deb Barman, causing alarms about the future electoral prospects of the ruling alliance.

She also announced that two other projects worth over Rs 21 crore were cleared by the Centre on Friday morning itself. The two projects include- widening of state highways (Rs. 14.15 crore) and various works in the capital city (7.4 crore).

The Union Finance Minister, who arrived in Tripura on a two-day visit, besides inaugurating local projects worth Rs. 189 crore, also reviewed the status of on-going Externally-Aided Projects (EAPs).

Besides, Sitharaman the review meeting was also attended by Chief Minister Biplab Kumar Deb, Deputy Chief Minister Jishnu Dev Varma, Chief Secretary Kumar Alok and other senior officials.

According to a tweet from Sitharaman’s office, the EAPs include Project for Sustainable Catchment Forest Management in Tripura (funding by Japan Internal Cooperation Agency), Tripura Urban and Tourism Development Project (funded by Asian Development Bank) and North Eastern Region Power System Improvement Project (funded by World Bank). These projects are meant for overall development of the state cutting across areas like education, health, communication, infrastructure, power and livelihood support.

Chief Minister Biplab Kumar Deb in a social media post also said the Union Minister had congratulated the state government for work done through EAPs in Tripura.

“FM Nirmala Sitharaman congratulates state officials on work done through EAPs for the holistic development of the state,” Deb wrote on his official Facebook handle.

The Union Finance Minister also interacted with health officials and met beneficiaries of Tripura’s ongoing Covid vaccination drive at a centre at Gandhigram, about 10 km from here. Sitharaman’s office later tweeted, “As on August 27, 33,24,427 anti-COVID vaccine doses have been administered in Tripura. 24,53,931 beneficiaries have received the first dose while 8,70,496 beneficiaries have received the second dose of vaccine. Tripura has 358 sites conducting vaccination.”

Accompanied by chief minister Deb, the Union Minister also paid a visit to Hatipara Forest Complex at Gandhigram. She inspected the Non-Timber Forest Products (NTFP) Centre and Agar plantation where she was apprised by the officials about the potentials of Tripura’s Agar sector. She also planted a sapling.

Sitharaman will visit Matabari temple at Udaipur and then Dasarath Deb Memorial School Ground at Killa village council under Gomati district where she will hold a meeting and interact with the members of women-run Self-Help Groups.

She is also slated to flag-off a mobile van of Tripura State Cooperative Bank Ltd on the occasion of 7th anniversary of Pradhan Mantri Van Dhan Yojana, before leaving the state.



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Covid health claims near Rs 30,000 crore for this fiscal so far, BFSI News, ET BFSI

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Even as fears of third wave mounts, Covid related health claims in the first five months of this fiscal have crossed the claims for the entire fiscal 2021.

About 23,64,957 Covid claims were reported on a cumulative basis by August 18, of Rs 29,949.9 crore. About 19,66,595 claims worth Rs 18,325.4 crore of the claims received have been settled, according to general industry data.

On a year-to-date (YTD) basis (April-July), insurers saw their premiums rise 15.49 per cent to Rs 64,607.25 crore, against Rs 55,939.85 crore in the year-ago period.

While Covid-related claims have come down recently, claims for routine surgeries and hospitalisation are rising.

Rising premiums

With rise in claims, premiums are also on the upswing.

Health insurance premiums have been main driver of non-life insurance industry since the commencement of Covid-19 pandemic as firms have recorded 19.46-per cent year-on-year (YoY) growth in premiums in July.

In July, about 33 non-life insurers garnered premiums of Rs 20,171.15 crore, against Rs 16,885 crore in the same month last year.

The health segment recorded 34.2 per cent growth during April-July this year, which is much higher than 9.9% a year ago, when there were country-wide restrictions.

A number of insurers are also looking at raising prices for health products to bridge the losses.

The YTD premium growth of standalone health insurers continued to be higher than industry average in YTD FY22, indicating that retail premiums are growing faster than group business as standalone health insurers derive most of their premiums from retail segment.

The government schemes have also been a significant factor in the growth as these premiums reached Rs 2,906 crore for the YTD July FY22 versus premiums of Rs 806 crore for a similar period last year.

Growth and losses

While general insurers grew 12.9 per cent on a year on year basis between April and July, standalone health insurers reported a 46.1 per cent growth in premium in the same period on an annual basis.
Of the three listed private life insurers-SBI Life Insurance and HDFC Life Insurance reported lower profits for the April-June quarter while ICICI Prudential Life Insurance reported a loss on account of rise in Covid claims.



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5 Best UTI Equity Mutual Fund SIPs To Consider

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UTI Flexi Cap Fund Direct

UTI Flexi Cap Fund Direct-Growth had assets under management (AUM) of Rs. 20,922 crores, making it a medium-sized fund in its category. The fund’s expense ratio is 1.1 percent, which is greater than the expense ratios charged by most other Multi Cap funds.

UTI Flexi Cap Fund Direct-Growth returns have been 60.70 percent over the last year. It has had an average yearly return of 17.71 percent since its inception.

The SIP of Rs. 10,000 per month for ten years with Rs. 6 lakh investment will be worth Rs.11.05 lakh.

A flexicap fund is unrestricted in its ability to invest a portion of its assets in any market cap. A flex-cap fund helps investors to broaden their horizons across companies with varying market capitalizations, thereby reducing risk and volatility. Diversified equities funds and multi-cap funds are two more names for them.

The Financial, Healthcare, Technology, Services, and Chemicals sectors account for the majority of the fund’s holdings. In comparison to other funds in the category, it has less exposure to the Financial and Healthcare industries.

UTI Long Term Equity Fund Direct

UTI Long Term Equity Fund Direct

UTI Long Term Equity Fund Direct-Growth manages a total of 2,046 crores in assets (AUM). The product charges a 1.33 percent expense ratio, which is more than most other ELSS funds.

The 1-year returns for UTI Long Term Equity Fund Direct-Growth are 52.32 percent. It has had an average yearly return of 15.52 percent since its inception.

An open-ended equity fund that invests at least 80% of its assets in equity-related securities. Its goal is to help members get a tax break under Section 80C of the Income Tax Act while also providing them with growth opportunities. The SIP of Rs. 10,000 per month for ten years with an Rs. 6 lakh investment will be worth Rs.9.91 lakh.

UTI Nifty Index Fund

UTI Nifty Index Fund

The Nifty Index Fund Direct-Growth manages assets of 4,353 crores (AUM). The fund’s expense ratio is 0.2 percent, which is lower than the expense ratios charged by most other Large Cap funds.

The 1-year returns for UTI Nifty Index Fund Direct-Growth are 46.46 percent. It has returned an average of 13.48 percent per year since its inception.

The scheme aims to invest in stocks of firms that make up the Nifty 50 Index in order to attain a passive investment return comparable to the Nifty 50 Index. The SIP of Rs. 10,000 per month for ten years with a Rs. 6 lakh investment will be worth Rs.9.51 lakh.

Reliance Industries Ltd., HDFC Bank Ltd., Infosys Ltd., ICICI Bank Ltd., and Housing Development Finance Corpn. Ltd. are the fund’s top five holdings.

UTI Mastershare Direct

UTI Mastershare Direct

The fund’s expense ratio is 1.03 percent, which is greater than the expense ratios charged by most other Large Cap funds. UTI Mastershare Direct-Growth manages a total of 8,580 crores in assets (AUM).

The 1-year returns on UTI Mastershare Direct-Growth are 48.05 percent. It has generated an average yearly return of 15.01 percent since its inception.

The plan aims to achieve long-term financial appreciation by investing primarily in large-cap equity and equity-related instruments. The NAV of UTI Mastershare Fund for Aug 25, 2021 is 195.46. The SIP of Rs. 10,000 per month for ten years with a Rs. 6 lakh investment will be worth Rs.9.68 lakh.

UTI Value Opportunities Fund

UTI Value Opportunities Fund

UTI Value Opportunities Fund Direct-Growth manages assets of Rs 6,305 crores (AUM). The fund charges a 1.29 percent expense ratio, which is more than most other Value Oriented funds.

The 1-year returns on UTI Value Opportunities Fund Direct-Growth are 51.01 percent. It has had an average yearly return of 14.09 percent since its inception. An opportunities fund invests in companies, industries, or investing topics where the fund manager sees potential for growth.

The majority of the money in the fund is invested in the financial, technology, healthcare, automotive, and services industries. The SIP of Rs. 10,000 per month for ten years with a Rs. 6 lakh investment will be worth Rs.9.84 lakh.

5 Best UTI Equity Mutual Fund SIPs To Consider

5 Best UTI Equity Mutual Fund SIPs To Consider

Fund Name 3-year Return (%) 5-year Return (%)
UTI Flexi Cap Fund Direct-Growth 18.70% 18.42%
UTI Long Term Equity Fund Direct-Growth 16.29% 15.53%
UTI Mastershare Direct-Growth 14.52% 15.19%
UTI Nifty Index Fund Direct-Growth 13.50% 15.16%
UTI Mid Cap Fund Direct-Growth 18.02% 14.99%

Disclaimer

Disclaimer

The views and investment tips expressed by authors or employees of Greynium Information Technologies, should not be construed as investment advise to buy or sell stocks, gold, currency or other commodities. Investors should certainly not take any trading and investment decision based only on information discussed on GoodReturns.in We are not a qualified financial advisor and any information herein is not investment advice. It is informational in nature. All readers and investors should note that neither Greynium nor the author of the articles, would be responsible for any decision taken based on these articles. Please do consult a professional advisor.



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Former union finance minister P Chidambaram says India’s recovery depends on Centre not taking foolish decisions, BFSI News, ET BFSI

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India’s economy will not recover to pre-pandemic levels in the current financial year or in 2022-23 if the Narendra Modi government continues to take “foolish decisions,” said former union finance minister P Chidambaram here on Thursday.

Chidambaram said that the Centre’s four year National Monetization Pipeline is a foolish decision that is akin to giving away the country’s assets that were built by the Congress party over several decades.

“The recovery in 2022-23 may take us to the pre-pandemic level, provided the government does not take foolish decisions,” said Chidambaram while speaking to reporters.

Speaking further, the AICC core group committee member, said that along with demonetization and faulty roll out of GST, the Centre’s refusal to increase public expenditure during a pandemic was a foolish decision. “And a few days earlier they took another foolish decision to monetize national assets,” said the former Union minister.

Chidambaram said that India’s economy ended with negative growth in the last financial year with no hope of any recovery even in 2021-22.

“The GDP for this year will not go to the pre-pandemic level of 2019-20. 2020-19 was a decline. 2021-22 will show an apparent increase in the GDP but it will not go back to the pre-pandemic level. Only when it goes to the pre-pandemic level, can you call it a recovery,” said Chidambaram.



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Floater Funds Have Been Seeing High Inflow: Top Funds Based On 5-Yr Returns

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1. HDFC Floating Rate Fund-Direct Plan:

The fund invests primarily in bonds that keep seeing change in interest rate in line with prevailing interest rate in the economy. In existence since the year 2013, the fund has offered a return of 8.34% and its benchmark is CRISIL liquid fund index. Assets of the fund as on July 31 is Rs. 20,211 crore. Expense ratio is 0.23%.

SIP in the fund can be started for Rs. 500 and in a span of 5 years, Rs. 10000 monthly SIP has grown in value to Rs. 7.28 lakh.

Top investments of the fund include floating rate debt instruments, fixed rate instruments, swapped for floating rate returns and money market instruments.

2. ICICI Prudential Floating Interest Fund - Direct Plan – Growth:

2. ICICI Prudential Floating Interest Fund – Direct Plan – Growth:

These fund show less of volatility in response to changing interest rate dynamics. Since its existence the fund has yielded returns of over 8 percent. Benchmark of the fund is CRISIL Low Duration Debt fund. Assets under the fund are over Rs. 12000 crore and the fund as per the mutual fund risk-o-meter carries a moderate risk.

SIP in the fund can be initiated for Rs. 100 and in 5-years time monthly SIP of Rs. 10000 is now worth Rs. 7.39 lakh.

The fund’s investments are deployed into GoI bonds, floating rate bond,NCDs, state development loans, zero coupon bonds etc.

3. Nippon India Floating Rate fund -Direct Plan:

3. Nippon India Floating Rate fund -Direct Plan:

The fund since its existence 2013 has been providing 8.59% and is low to moderate on risk. The fund asset size is Rs. 17,587 crore. Benchmark of the fund is CRISIL Short term bond Index. Expense ratio of the fund is 0.24% as on July 31, 2021.

SIP in the fund can be initiated with Rs. 100 and the fund’s portfolio includes investments across GOI, CD, Treasury Bill, NCD and Bonds, and Commercial Papers.

Top 3 Floater Funds Based On 5-Year Returns

Top 3 Floater Funds Based On 5-Year Returns

Floater funds Rating 5-Year Annualised Return 5-Yr SIP Annualised return
HDFC Floating Rate Fund-Direct Plan CRISIL 3Star and Morning Star 5-Star 7.71% 7.71%
ICICI Prudential Floating Interest Fund – Direct Plan – Growth CRISIL 1 Star rated and 8.27% 8.3%
Nippon India Floating Rate fund -Direct Plan 3-Star CRISIL and 5-Star Morning Star 7.98% 8.31%

Disclaimer:

Disclaimer:

So, investors who want to tap on the prospects of rising interest rates in the economy can bet on these funds which as against other debt funds benefit from rising interest rates. Nonetheless, here the data is collated just for the purpose of information.

GoodReturns.in



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How to save on premium in life policies

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The recent pandemic has shed light on the importance of life insurance. While the awareness for life insurance has increased, you may be able to save on it if you know about key factors that influence life insurance premiums.

Age

The age of the life assured plays a critical role in determining the premium. The mortality rate, i.e. probability of death, increases with age. Therefore, a person with a higher age shall be required to pay higher premium than a younger person. Based on the IALM (Indian Assured Lives Mortality) 2014-16 table, the mortality rate at age 50 is 380 per cent higher than the mortality rate at the age of 20. Additionally, as per the mortality tables worldwide and experience, women are likely to have 30-35 per cent lower mortality than a man of similar age. Therefore, women are likely to be charged lower premiums than men.

Lifestyle matters

Health parameters and lifestyle choices also play an essential role in determining life insurance premiums. Higher BMI (body mass index) indicates overweight or obesity leading to many medical complications including diabetes and cardiovascular problems. The mortality rate for an obese person is likely to be higher, and the company may charge an extra premium to cover the additional risk. Moreover, underwriters view excess weight or obesity as one of the major risks to life. One needs to make lifestyle changes to reduce the weight and thereby lower the BMI. Adopting a healthy lifestyle, controlling the intake of calories, and regular workouts will be beneficial. This will help reduce any extra premium loading, which may go up to 50-200 per cent over standard mortality on a case to case basis or may even be declined.

Similarly, smokers tend to have a higher mortality as compared to non-smokers. Therefore, smokers are required to pay higher premium than non-smokers of the same age. The premium for a smoker may be close to 50-60 per cent higher than the premium for a non-smoker.

The same is the case for the consumption of alcohol. Excessive drinking harms one’s health, and the underwriter may load an extra mortality premium of 50-200 per cent or even decline cover for an addicted heavy drinker.

Besides, a history of medical conditions, family history of illnesses (hereditary diseases) could factor into your life insurance premium and increase the cost of your coverage.

Work matters

Hobbies or jobs like skydiving, racing cars which are high risk in nature, could lead to higher premiums by the underwriting philosophy of the insurer. Certain hazardous occupations which expose a person to toxic chemicals or require one to perform dangerous duties may require a higher premium.

That said, for an individual, when it comes to life insurance, a term life cover should be of top priority. While the above are the critical reasons for premium variation, it is easier and cost-effective if a term cover is purchased early for lifelong coverage.

The writer is Chief Actuary and Chief Risk officer, Kotak Life Insurance

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