Insurance Development and Regulatory Authority (IRDA)

What is the Insurance Regulatory and Development Agency or IRDA? 

The Insurance Regulatory and Development Authority or IRDA is an autonomous body in India  responsible for  the administration of the Indian insurance industry, covering both life insurance companies and general insurance. Insurance sector is one of the big sectors in India which offers diverse opportunities to policyholders. It is therefore governed by a separate body known as the Insurance Regulatory and Development Authority or IRDA. IRDA acts as the leader of the insurance industry in India and regulates all the rules and policies for the various insurance companies in the country.The insurance industry in India has grown significantly over the years as more and more new companies enter the market. This has led to increased competition in the industry, both in the general insurance and life insurance sectors. All of these companies had their own set of rules and policies, which created confusion in the market. The Insurance Development and Regulatory Authority (IRDA) was formed to establish an established model of rules and guidelines to be followed by all insurance companies.Speaking of the Insurance Regulatory Development Authority (IRDA), it can be said that it acts as the head of the family that protects the needs of each family member  and maintains the balance between the family while  resolving the differences between the family members. and help them in crises. As the head of household is responsible for the entire family,  the Insurance Regulatory Development Authority (IRDA) is similarly responsible for the country's insurance industry  and directs the insurance industry by setting certain rules and regulations that all members and insurance companies must follow. 

How does the Insurance Regulatory and Development Agency (IRDA) work?

To this end, IRDA ensures that no insurance company can refuse a claim against a policyholder unless it falls outside the scope of coverage. To ensure fair practices in the industry, IRDA also requires monthly or annual audits of insurance companies. It also regulates the tariffs and conditions set by  insurance companies to ensure equality for all consumers. The Insurance Regulatory and Development Authority or IRDA also works to resolve any dispute or misunderstanding that may arise between the insurance company and the policyholder regarding the policy in question.

Responsibilities of the Insurance Regulatory and Development Agency or IRDA 

1. Protecting the interests of policyholders, giving them a sense of security and confidence in the policy they have invested in.
2. Promoting efficiency in running the insurance business.
3. Inspect and investigate insurers, brokers and other organizations. Regulate the investment of funds and the solvency margin of companies.

Loan Products from Banks

Credit can be used for various things in today's world. With this you can finance a business start-up or buy equipment for your newly acquired home. Let's talk about the different types of loans available in the market and their specific features that make these loans useful. to the customers. Various types of loans are available in India, which are classified into two factors depending on their purpose:

Secured Loans 

Unsecured Loans 

Secured Loans Secured loans  are those where you have to pledge an asset as collateral for the money you borrow from the lender. That way, if you are unable to repay the loan, the lender still has somethingmeans money back. The interest rate on secured loans tends to be lower  compared to unsecured loans. 

Home Loan – If you are looking to buy a home, applying for a home loan can go a long way.It offers financial support and helps you buy the house for you and your loved ones. These loans usually have longer terms (20  to 30 years). The rates offered by some of the major banks in India. Your creditworthiness will be checked before the lender approves the loan application. If you have  good credit, chances are you'll benefit from lower interest rates on your home loan.Mortgage loans are mainly taken out for the purchase of new houses. However, these loans can also be used for home renovations, home extensions,  land purchases, houses under construction, etc. 

Loan Against Property (LAP) A loan against property is one of the most common forms of a secured loan.You can mortgage any residential, commercial, or industrial property to draw on the funds you need. The loan amount paid out corresponds to a certain percentage of the property value and varies depending on the lender. While some lenders may offer an amount as high as 5060% of the property's value, others may offer an offeran amount of almost 80%. A home equity loan  helps you unlock the latent value of your assets and can be used to further personal life goals such as higher education for children or marriage. Businesses use a loan against the property for business expansion, R&D, and product development, among other things.

Gold Loan – A gold loan can be used to raise cash to meet planned or urgent financial needs like business expansion, education, medical emergencies, farming expenses, etc. A loan against gold is a secured loan where gold is placed as security or collateral against a loan amount equal to the market value per gram  of gold on the date the gold is pledged. Any other metals, gems or stones found in the jewelry are not counted in determining the  gold loan value.

Unsecured loans are loans that do not require collateral. The lender will give you the money based on previous connections, your credit score and history. Therefore, you must have  good credit  to take advantage of themLoan. Unsecured loans usually have a higher interest rate  due to the lack of collateral. 

Personal Loans: Most banks offer personal loans to their customers and the money can be used for any expenses, e.g. B. to pay a bill or to buy a new TV. , these loans are unsecured loans.The lender or  bank will require certain documents such as proof of assets, proof of income, etc. before approving the amount of the personal loan. The borrower must have sufficient assets or income to repay the loan. For personal loans, the application is 1 or 2 pages long. The borrower learns about the rejection or approval of the loan within a few days.Keep in mind that the interest rate  associated with these loans can be higher. The term of these loans is not that long. So if you borrow a large amount, you may find it  difficult  to pay it back without planning your finances properly. 

Small Business Loans:Small business loans are loans made to small  and medium-sized businesses to meet various business needs. These loans can be used for a variety of purposes that help  the business grow. Pay employee salaries, pay marketing expenses, pay off business debts, settle administrative expenses, or even  open a new store or acquire a franchise. 

Education Loan – An education loan is  specifically designed to fund educational needs for school or college.Depending on the lender, it covers basic course fees, exam fees, accommodation fees and other various costs. The student is the borrower and any other close relative is the co-applicant, e.g. a parent, grandparent, spouse or sibling. It can be used for courses in India or abroad. It can be completed part-time or full-time for a  variety of recognized courses. They include vocational courses as well as bachelor and postgraduate courses.

Basics of Credit Card and Debit Card

Debit cards allow you to spend money by withdrawing money that you have deposited at the bank. If you use a debit card, the  amount of your purchase will be debited from your checking account in near real time. Credit cards allow you to borrow money from the card issuer, up to a certain limit, to purchase items or withdraw cash. If you use a credit card, the amount will be charged to your line of credit, which means you  pay the bill at a later date, which also gives you more time to pay. 

Pros and cons of debit and credit cards

Debit Card Pros There is no debt as you are using your own money. It is cheaper to use as there are no interest charges. It also doubles as an ATM card, so you can use it to withdraw money from an ATM.Approving a debit card is easier and faster. Building a credit history doesn't help. 

Debit Card Cons You have no option to keep cash in your account as the money is debited directly. You can make it harder to balance your savings account at the end of the month if you don't keep track of your spending.If you withdraw money from another bank's ATM, you may be charged a fee. There is very little protection against debit card fraud. Check your eligibility

Credit Card Pros Credit cards are extremely practical and save you  having to carry cash with you. Credit cards help you build your credit score. The rewards you earn are much higher than with debit cards. come with relatively high credit limits. 

Credit Card Cons If you don't pay your bills on time or in full, you will be charged  high interest. Credit cards have different fees. Missing a payment (even for real reasons) can negatively impact your credit score. You have to work a lot harder to build it. Although there is a credit limit, you could always be tempted to spend more than  you have.This leads to debt.

Basics of Banking Part II

The following are the functions of  banks in India: Accepting deposits from the public Providing facilities for retrieving disbursements Lending Facility Transferring fundsissuance of payment instructions. Currency Handling The following are the different types of banks in India: Central Bank Cooperative Banks Commercial Banks Regional Rural Banks (RRB) Local Banks (LAB) Specialty Banks Small Financial BanksPayment Banks

Central Bank The central bank of our country is the Reserve Bank of India. Every country has a central bank that oversees all  other financial institutions in the country. institutions

Co-operative banks These banks are governed by a law issued by the state government. They provide short-term credit to agriculture and related industries. The main goal of the cooperative banks is to improve social welfare by providing low-interest loans. commercial banksThey work on a commercial basis, with profit as their main objective. They are owned by the government, the state or a private company and have a unified structure. They serve all sectors, from rural to urban. Unless otherwise stated by the RBI, these banks do not charge favorable interest rates. 

Commercial banks in India 1) Public banks 2) Private banks 3) Foreign banks

Local Area Banks (LAB)The private sector organizes them.The main goal of local banks is to generate profits. Local banks are governed by the  Companies Act 1956. There are now only four local banks, all  located in South India. 

Specialized Banks Certain banks only exist  to serve a specific purpose.Specialist banks are the designations for different types of financial institutions. Here are some of them: SIDBI (Small Industries Development Bank of India) SIDBI can provide a loan to a small business or company. With the support of this bank, small businesses can obtain up-to-date technology and equipment. Export and Import Bank (EXIM Bank) EXIM Bank means Export and Import Bank.This type of bank can provide loans or other financial assistance to foreign countries that export or import goods. NABARD (National Bank for Agricultural and Rural Development): People can turn to NABARD for any kind of financial support for rural, artisan, village and farm development activities Small Financial Banks This type of bank, as the name suggests, offers Loans and grants to micro-industries, small farmers and the unorganized sector of society The country's central bankThe Reserve Bank of India conceived the payments bank, a newly developed form of banking. People who have a payment bank account can only deposit up to Rs. 1,00,000 and cannot apply for any loans or credit cards through this account. 

Payment banks offer services such as internet banking, mobile banking, ATM card issuance and debit card issuance. The following is a list of the few payment banks in our country:Airtel Payments BankIndia Post Payments BankFino Payments BankJio Payments BankPaytm Payments BankNSDL payment bank

Basics of Insurance

 The basic principle of insurance is that a company chooses to regularly spend small  amounts of money against the possibility of a large unexpected loss. In principle, all policyholders bear their risks together. Any loss they suffer is paid for by their premiums that they pay. 

What is insurance? 

Insurance is a legal agreement between two parties i.the insurance company (insurer) and the person (insured). The insurance company undertakes to compensate the insured for damage if the insured event occurs. Contingency is the event that causes a loss. This may be the death of the insured or property damage/destruction. It is called  contingency because there is uncertainty about the occurrence of the event.The insured pays a premium for the insurer's commitment. 

How does the  insurance work? 

The insurer and the insured enter into a legal contract of insurance known as an insurance policy. The insurance policy contains details of the conditions and circumstances under which the insurance company will pay  the insured sum to  the insured person or the authorized representatives.Insurance protects you and your family from  financial loss. In general, the premium for good insurance coverage is much less for the money paid. The insurance company bears the risk of offering high coverage for a small premium, since very few policyholders actually use the insurance. That's why you get insurance for a large sum at a low price.Any individual or business can apply for insurance from an insurance company, but the decision to provide insurance is at the discretion of the insurance company. The insurance company will review the claim application to make a decision. applicant. 

Reduce risk 

Even if you are in an armored vehicle, there is always  some risk that the map will tip over.You can lead an extremely healthy lifestyle and exercise regularly, but whatever your health condition, there are risks such as: Personal accidents. The point you need to understand here is that no matter how hard you try, there will always be some risk in our activities. It is important to have a thorough understanding of the various risks that can arise throughout life. There are two types of risk: tolerable risk and intolerable risk. For example, we can afford to lose our portfolio with a few hundred or thousandsBut we cannot afford to have our car, worth thousands of rupees, or our house lost or damaged in the same way. At its core, insurance is  about risk reduction. For risks that exceed our tolerance level, insurance products provide a way to protect against specific events/conditions. Click here to stay protected with a comprehensive suite of insurance solutions that Standard Chartered offers you through its insurance partners.

Following are the types of life insurance available in India:  

Life insurance

Health insurance

Car insurance

Education Insurance

Home insurance

Basics of Taxation

Taxes are important and largest income sources for the government. The government used the money collected from taxes for various projects for the development of the nation. The Indian tax system is well structured and has a three-level federal structure. There are two ways to classify various types of taxes in India: Taxes are collected by the Central Government and state government 

By the Central Government: This includes income tax (exception is tax on agricultural income), customs, corporate tax, customs, land duties, and more 

By the State Government: Taxes on agrarian revenues, VAT (additional taxes), electricity consumption and sales tax, land income, toll roads and more 

By local civil bodies: city companies and other local government agencies collect taxes such as property taxes 

What is Direct Tax? Direct taxes imposed on corporate entities and individuals. These taxes cannot be transferred to others. For individual taxpayers like you, the most important type of direct tax is income tax. This tax is collected for each year of assessment (April 1 to March 31). In accordance with the income tax law, 1961, is mandatory for you to pay income tax if your annual income is above the minimum liberation limit. You can get tax benefits under various parts of the Act. Before we talk about tax benefits, it is important for you to understand the income tax slab. 

What is indirect tax? The meaning of the tax does not directly reflects the type of taxation that applies to the sale of goods and services. Thus, this is different from the direct tax charged to the income you get. In indirect taxes, people where the load falls and people who pay different taxes. The seller is required to pay this tax to the government (eg, manufacturers, retailers,). But because they sell goods to consumers, they pass the burden of paying taxes to you. Thus, when you buy goods, you pay the amount of tax for the seller. The seller then pays taxes to the government. 

Other taxes Another tax is a small income generator and is a small CESS tax. Various other sub-categories of tax are as follows: 

Property Tax: This is also called real estate tax or city tax. Residential and commercial property owners submit to property taxes. This is used for maintenance of several fundamental civil services. Property tax is collected by city bodies based in every city. 

Professional tax: This work tax is collected in those who practice profession or earn money income such as lawyers, rented accountants, doctors, etc. This tax is different from the state to the country. Not all declare professional tax retribution. 

Entertainment tax: This is tax imposed on television series, films, exhibitions, etc. Tax is collected in the gross collection of income. Entertainment tax is also referred to as entertainment tax. 

Registration fee, stamp duty, transfer tax: This is collected in addition or as a supplement to property tax when buying property. 

Education Cess: This is collected to fund education programs launched and maintained by the Indian government. 

Tax Entry: This is a tax collected on products or items that enter the country, specifically through e-commerce companies, and apply in the state of Delhi, Assam, Gujarat, Madhya Pradesh, etc. 

Road tax and toll tax: This tax is used for road maintenance and toll infrastructure. 

Tax benefit. Tax objectives are to provide funds for expenses without inflation. Taxes are used by the government for various purposes, some of which are: Public infrastructure funding Development and Welfare Projects Defense expenses Scientific research Public insurance Civil servant and government salaries Government operation Public transport Unemployment advantage Retirement scheme Law enforcement Public health Public education Public utility

Saving and Investment Products

1) Public Provident Fund (PPF) The PPF is traditionally regarded as one of the best and best investment vehicles in India and is among the best small savings plans. PPF account holders can invest up to Rs 1.5 lakh in a  financial year, the minimum deposit required is Rs 500.Deposits can be made in one sum or in 12 installments. PPF deposits are deductible from income under Section 80C of the Income Tax Act. This means that an investor does not have to pay any taxes on the three levels of investment, incorporation and withdrawal. 

2) mutual fundsMutual fund dealers allow you to compare  funds based on various metrics such as risk level, performance and price. Additionally, since the data is easily accessible, the investor should be able to make smart decisions. In addition, mutual funds offer advantages in terms of liquidity and professional management 

3) Direct Equity Direct plans help you  save money on commissions and expenses related to marketing.This small saving is credited to the program and  could allow you to earn additional returns over a longer period of time. 

4) Real Estate Investing Real estate investing is among the most suitable and lucrative in India as the  development opportunities are enormous as the market continues to grow. 

5) Gold Investment Traditionally regarded as one of the  best options, gold investment plans offer you the opportunity to turn tied up wealth into high-quality liquidity.

6) Correos Savings Plan Ideal for retirees who need a steady income,  includes the ability to convert accounts. these can be public IPOs)IPOs of well-known companies are an ideal, low-risk and long-term investment opportunity. are among the best investments in India.

7) Business Deposits, which are Fixed FDs) Business deposits  offer higher interest rates than bank FDs and are ideal for long-term investments. 

8) Initial offerings, which can be public IPOs) IPOs launched by reputable companies represent an ideal long-term, low-risk investment opportunity. 

9) ULIPs (Unit Linked Insurance Policies)ULIPs offer a number of benefits and offer the combined benefits of insurance and investment. Known for their income tax benefits, ULIPs are among the best investments in India. 

10) BondsBonds are typically liquid, making it easy for an organization to sell a  large amount without greatly impacting costs. The investment term and the returns are payable  monthly, annually or semi-annually, depending on the banking policy. 

12) Senior  Savings Plan (SCSS)SCSS are tax-free and a risk-free investment  for  residents over the chronological age of 60. They offer high interest rates  and are very lucrative. 

13) RBI Taxable Bonds These RBI bonds are valid for 7 years and are issued in the form credited to the annuity book account holder

14) National Pension Scheme This is a government organized pension product for workers in all sectors. in India and offers equity, corporate bond and government bond based plans. A minimum contribution of Rs 6,000 per year is required in NPS while there is no upper limit.