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LETTER
ISSUE CONTENTS
FROM THE
3 November 2011
EDITOR
LAIM INSURANCE C
Doctrine Of Lapse
insurers on the part of the under the policy ptly. If of any liability of ss your claim prom nt to admission . to enable us proce form does not amou ctly and completely lete a Personal Accident Claim Form Issuance of this information corre ing comp e follow pleas the ance, Please give ent Insur h / Year r Personal Accid ed as Date / Mont the claim is unde All dates to be enter ed: Name of the Insur
1.
Y
ou have bought an insurance policy, the best available in the market. This is in addition to the insurance cover that your company gives you. Doesn’t that secure feeling envelop you because you have taken care of your future? Don’t relax. Just buying an insurance cover is not enough. Even if you have gone through the fine print of your insurance contract with a toothcomb, and paid all your premiums on time, there is no guarantee that your claim will be settled. That’s what this Cover Story is all about. Again, neither an insurance company nor an advisor will give you even a glimpse of the information and advice we have put together for you. Markets around the globe have hit a rough patch—and there is too much uncertainty in the air. Moneylife has been repeatedly writing about the inherent dangers in ‘emerging’ markets, and China, the biggest player, looks like it is about to spoil its own party. See inside for more. And if China sneezes, global bourses will freeze. Aren’t you tired of reading patchy reports about the industrial unrest in Gurgaon? Our correspondent placed his ear on the ground and has given you an insider take in this issue. Do check out our website too for more details. The Moneylife Foundation held comprehensive seminars on microfinance, the dangers of Ponzi schemes and the intricacies of handling your legacy. We’ll let you know more about the latest seminar on the Right to Information (RTI) Act chaired by Wajahat Habibullah, former chief information commissioner and senior Supreme Court lawyer Anil Divan... visit the Foundation’s website for more on this event. If you have not yet become a member of the Moneylife Foundation, please do register. It’s free. Our activities have expanded beyond Mumbai... and we might be coming to a city near you. TV channels make a big draw out of their campaign for ‘citizen’ journalists—but Moneylife has been carrying the voices of citizens for over five years now. If you feel strongly about any issue, do write to me at editor@moneylife.in. Here’s looking forward to your feedback. Debashis Basu MONEYLIFE | 3 November 2011 | 10
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____ _______________ ______ _______________ claim is made) _______________ (in respect of whom _______________ : _______________ Insured : _____ ionship with the (a) Name & Relat
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28 Cover Story
Insurance Claim Rejected
Health insurers are rejecting claims on flimsy grounds. Raj Pradhan explores the sick side of mediclaim and guides you on how to protect yourself
13 Your Interest NPPA will soon verify the landed cost of drugs on Indian shores; Kalpavalli in AP is witnessing degradation after initiation of a wind energy project; Promising amenities to prospective flatowners in a Mumbai high-rise and not fulfilling them has cost EMG Developers Rs6.07 lakh; If you forget your tickets, your smart-phone will help; BPCL’s ‘Pure For Sure Platinum’
14 Your Money RBI relaxes norms on small money transfers; SEBI announces uniform forms for customer identification; SEBI to study STT impact; Union KBC introduces investor awareness programmes & MF-related transactions through ATMs; Andhra Bank’s prepaid gift and international travel cards; Ashok Leyland ties up with City Union Bank; MCX launches cotton futures; Birla Sun Life’s facilities; Equity flows rise
18 Current Account – Steve Jobs and India
19 LOOSE CHANGE Moneylife Quiz; Soundbites Disclaimer: Moneylife has a policy of not allowing its editorial staff to buy and sell stocks that are written about in the magazine. All personal transactions in individual stocks are subjected to internal disclosure rules.
CONTENTS
20
WHICH WAY
PAN freedom: Are FIIs flouting the rules; RBI: The apex bank is ineffective; Foreign inflows: Are official figures a lie?
SAVING AND INVESTING
42 China Too?
51 Retirement Planning
Will China be the next surprise?
Would you need 135% of your final income in retirement years? TRAVEL
DIFFERENT STROKES
Valley: 52 Kathmandu A Living Museum
22 Occupying Main Street
Jaideep Mukerji explores a wealth of history & grand architectural traditions and basks in a unique cultural experience—not too far from home
From Wall Street in the US to the main street in India, public protests are raging SMART MONEY
Bank 24 Don’t on Them Why investors should stay away from government-controlled banks
Momentum
Solar Industries climbed 4% and HDFC jumped 4%, while Yes Bank too rose 4%
Medium Term
FUNDS
26
STOCKGRADER 43
No Game Changer, This
Even the absurdly low cost of IIFL’s Nifty ETF doesn’t make it a big winner vis-à-vis actively-managed funds, show Debashis Basu and Megha Vora
Navin Fluorine climbed 9% and Asian Paints ended unchanged, while Idea Cellular fell 5%
Long Term
Titan gained 4%, Asian Paints settled flat. CRISIL tumbled 2% and Lupin lost 4%
AUTO
INTERVIEW
is likely to be 36 “Portability more illusory than real” 48 Fali Poncha, executive chairman, IRICS Insurance Broking, shares his invaluable insights on whether the newly introduced mediclaim portability would work
Off the Track
– Noida Formula 1 is on skid row – Make the best use of no claim bonus on motor insurance – Hyundai Eon will compete with Maruti Alto – Gurgaon is witnessing an industrial exodus
38
Gujarat Fluorochemicals: Investments in new ventures & high growth potential in the coming years; Hero MotoCorp: Will Hero do well without Honda?
Foundation 58 Moneylife Events Ramesh Arunachalam explains the microfinance crisis Sucheta Dalal warns people against get-richquick schemes
BEYOND MONEY
66 Aforthought school
Alekh Angre visits an organisation which helps to school underprivileged children
STOCKS
Street Beat
EVENTS
LEGALLY SPEAKING
50
Supporting the Status Quo
The new takeover regulations tilt the balance in favour of existing managements
DEPARTMENTS Letters............................. 4 Book Review.....................56 Living .............................62 Money Facts.....................63