STI NEWS;"89(1) relief on Gratuity Received in FY 2011-12"plus 4 more |
- 89(1) relief on Gratuity Received in FY 2011-12
- How critical is home insurance?
- Are buildings in India safe?
- What to remember when you shop for a credit card!
- Repaying a personal loan!
| 89(1) relief on Gratuity Received in FY 2011-12 Posted: 20 Sep 2011 10:10 AM PDT
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| How critical is home insurance? Posted: 20 Sep 2011 03:43 AM PDT
Are we personally capable to financially withstand if our property were to be hit by a Tsunami like Japan. The Recent Japanese earthquake & Tsunami loss is estimated at $309 billion. The numbers would be mind boggling if we convert to Indian currency! The dream of the average lower or middle class people in India is to own a house with probably an area of 1000 sq ft costing at least 15 lacs. Most people borrow a loan to help fund their dream. What if this dream home is destroyed due to a natural disaster? Who can we blame for this unexpected happening? Though the government will support with relief fund but will this fund help us to rebuild the same house which we had? Or can you save Rs 15 Lakh in cash to rebuild the house? The basic five elements of nature – earth, air, fire, water and space along with the various forces of nature, can create any sort of disturbance in this universe. This disturbance may be once in thousand years, this day may be today or tomorrow or a week later. But it's very much unexpected. This means Tsunami in Japan last month could occur anywhere this month. Are we prepared to withstand this loss financially? Naturally we may not be prepared because the impact or cost of any natural disaster may be abnormally high. But on a personal front we do have some recourse The solution is to insure the Home under standard fire & special perils policy given by almost all General Insurance companies. It could be good thing to do so when you apply for a home loan as there maybe some benefits attached to it. Fire and Special Peril Policies provide protection against damages/fortuities triggered by the following perils:
a) Fire – Excluding destruction or damage caused to the property insured by - Its own fermentation, natural heating or spontaneous combustion. - Its undergoing any heating or drying process. b) Lightning c) Explosion/Implosion d) Excluding destruction or damage caused to the boilers (other than domestic boilers), by its own explosion/implosion e) Aircraft Damage f) Destruction or damage caused by Aircraft, other aerial or space devices and articles dropped there from excluding those caused by pressure waves g) Riot, Strike, Malicious and Terrorism Damage h) Loss of or visible physical damage or destruction by external violent means directly caused to the property insured i) Storm, Cyclone, Typhoon, Tempest, Hurricane, Tornado, Flood and Inundation j) Impact Damage k) Impact by any Rail/Road vehicle or animal by direct contact l) Subsidence and Landslide including Rock slide m) Bursting and/or overflowing of Water tanks, Apparatus and Pipes n) Missile Testing operations o) Leakage from Automatic Sprinkler Installations p) Bush Fires 2. Earthquake The above mentioned covers are more than sufficient for any house building. This covers all natural disasters and any kind of fire occurrences. The fire can be of any sort. For example cooking cylinder bursting is also covered But not everything is covered! a) 5% of each and every claim resulting from the operation of Lightning. STFI (Storm, Tempest, Flood and Inundation) and Subsidence & Landslide including Rockslide covered under this Policy. b) Loss, destruction or damage caused by war. c) Loss, destruction or damage directly or indirectly caused to the property insured by nuclear forms. d) Loss, destruction or damage caused to the insured property by pollution or contamination. e) Loss, destruction or damage to bullion or unset precious stones, any curios or works of art for small amount exceeding Rs.10000/-, manuscripts, plans, etc. f) Loss, destruction or damage to the stocks in Cold Storage premises caused by change of temperature. g) Loss, destruction or damage to any electrical and/or electronic machine, apparatus, fixture or fitting (excluding fans and electrical wiring in dwellings) arising from or occasioned by over running, excessive pressure, short circuiting, arcing, self-heating, or leakage of electricity, from whatever cause (lightning included) h) Expenses necessarily, incurred on i) Architects, Surveyors and Consulting Engineer' Fees and j) Debris Removal by the Insured following a loss, destruction or damage to the property k) Loss of earnings, loss by delay, loss of market or other consequential or indirect loss or damage of any kind or description whatsoever. The Exciting news! Premium – Surprisingly the premium for this product is 0.06% + Service Tax. This means per lakh you may have to pay Rs. 67 per annum. What's even more interesting is that one can avail a 50% discount on premium if one wishes to insure his/her house for 10 years by paying the premium upfront. Valuation of the Building – It is advisable to take the valuation at the prevailing market price. So the next time you hear of natural calamities destroying houses or wiping out villages, you can rest assured that your family can overcome the financial burden caused if god forbid such a thing occurs to you. All that you would need is to spend a few hundreds to get covered and get peace of mind too! | ||||||||||||||||||||||||||||
| Posted: 20 Sep 2011 12:33 AM PDT
As per Delhi government, 6.5% houses in Delhi have high damage risk and 85.5% have moderate damage risk (going by the Vulnerability Atlas of India (1997), in the event of an earthquake of intensity 8). If an earthquake similar to one that struck Japan, struck Delhi, as per the experts the devastation will be unimaginable.
As per the National Building Code of India, India is divided into five seismic zones. The zone V is the highest risk zone where earthquakes of having intensity of 9 plus on the Richter scale can take place. Earthquake of intensity between 8 to 9 can be experienced in Zone IV whereas earthquake can occur between 6 and 8 on the Richter scale in Zone III of India. The above table gives details of important cities of India. The National Building Code in 2005 has directed state governments to ensure that all new buildings follow the Indian seismic code which is recommended. However, with corruption being the root cause, the implementation is lax to non-existent. Also dense building structures, growing population, improper city and non-engineered building practices have increased the risk. Need of the day There is a need for construction of seismic proof buildings. The National Disaster Management Authority (NDMA) has made it compulsory for all new constructions to be earthquake-resistant, especially in cities located in seismic zones. The guidelines have also recommended selective seismic strengthening and retrofitting of existing priority structures located in high-risk areas. As per the National Building Code of India An earthquake-resistant building has four virtues in it, namely: (a) Good Structural Configuration: Its size, shape and structural system carrying loads are such that they ensure a direct and smooth flow of inertia forces to the ground. (b) Lateral Strength: The maximum lateral (horizontal) force that it can resist is such that the damage induced in it does not result in collapse. (c) Adequate Stiffness: Its lateral load resisting system is such that the earthquake-induced deformations in it do not damage its contents under low-to-moderate shaking. (d) Good Ductility: Its capacity to undergo large deformations under severe earthquake shaking even after yielding, is improved by favourable design and detailing strategies. The Bureau of Indian Standards (BIS) has laid down different criteria for different earthquake prone zones in the country. While the regulations do not guarantee that the damage will not happen during the quake, they do ensure that structures are able to respond to earthquake shakings of moderate intensities without structural damage and of heavy intensities without total collapse While there is no such term as "earthquake proof", as no building can be entirely safe from earthquakes. The building can however be earthquake resistant, which means that minimum damage to life and property is caused following an earthquake. The builder has to follow the minimum permissible safety standards. Also it should be made mandatory that a copy of 'structure certificate' should be given to the buyers at the time of booking. It is also the duty of the buyer to ensure that the 'structure certificate' is given and they can check if earthquake resistant elements have been incorporated.
'A house saved is a house constructed'. Hence it is duty on the part of the government, builder and buyer to make sure that the dream house does not fall like a pack of cards in times of the quake. To take necessary precautions is one's commitment to safety. | ||||||||||||||||||||||||||||
| What to remember when you shop for a credit card! Posted: 19 Sep 2011 07:12 PM PDT
As the features offered by each credit card varies, it is essential for you to understand which features will benefit you a lot. If you are shopping regularly at a particular store, go for a credit card that offers your reward points or cash back or discount when you shop at that store. Don't select a card that offers you free air miles on usage, if you are not a regular flier. Today it is difficult to come across a person who doesn't own a credit card. With the rise in standard of living, banks are coming out with increasing number of cards offering a number of innovative features. While it increases the number of options open to the customers, this innovation can also confuse the person looking to own his first credit card. As a result, it is very important for you to choose the right credit card so that you can get the best out of credit card. We answer some of your questions on how to select the right credit card for your needs. What card is ideal for me? As the features offered by each credit card varies, it is essential for you to understand which features will benefit you a lot. If you are shopping regularly at a particular store, go for a credit card that offers your reward points or cash back or discount when you shop at that store. Don't select a card that offers you free air miles on usage, if you are not a regular flier. Do you use the credit card to pay your utility bills? Then choose a card that provides you benefits for paying your bills. Besides rewards, also take a look at the interest charged. If you intend to carry outstanding balances each month, then it is advisable to choose a card offering a low interest rate. But if you can manage to pay off the balance in full at the end of each month, it is advisable for you to go for a card with high interest rate but with low or nil joining and annual fees. If you are traveler, check out if the card has widespread acceptance. What are the important features my card should have? Though cards contain many important features, some are the more important than others. While we all like to be rewarded for using the card, it should not be the sole criterion affecting your decision. Instead here are some essential features to look at when choosing a card.
How do I compare these features? You can visit the websites of various banks, and go through the details of their various card products or get someone from the bank to give you a call to explain what features each product has. | ||||||||||||||||||||||||||||
| Posted: 13 Sep 2011 10:20 PM PDT
More often than not many of us consider a personal loan as the best option to meet contingencies. Opting for a personal loan without studying its terms and conditions and services could cost you more than what you intended!
If you are stuck in a personal loan debt, here are some ways to free yourself: Asset monetization If you have one or more of these assets such as car, home, life insurance policies, tax saving certificates, shares, bonds and debentures, or gold jewelry, bank fixed deposits, or mutual funds, you could monetize them to pay off your debt. In fact, some banks offer loan against assets that carry a lower rate of interest which could be used to settle your personal loan. Consider debt consolidation Another effective way of dealing with your debts is through what is called debt consolidation. In this method, you could pay a relatively lower installment every month over a longer tenure to the lender who will combine all the components of your debt portfolio into one. Debt consolidation is an effective option if you have too many loans to take care of and not enough monetary capacity for astute financing as this method will give you a built-in view of your credit worthiness. Though beware that when you calculate the total loan cost in the long run, it might become expensive. However, the idea is to obtain a short term relief under the current circumstances. Once your finances improve aim to close the loan earlier than planned. Top up or convert to a secured loan If you had taken a home loan you can move to a lower cost credit by going for a top up on your current loan. Another viable option would be to talk to your bank and if they agree convert the current loan into a secured loan against your vehicles, house, but only if the property is free from debts, liens or mortgages. This way you can restructure the loan for a lower monthly payment after taking into consideration the loan tenure and the interest rate. Perhaps, the only drawback in converting a personal loan into other loans having collateral is that you stand to lose the collateral at risk in case of default on your loan amount, which could mean a lot when there is a contingency in the future. Hence, it is advisable to convert your current debt into a secured loan only after analyzing your capacity to repay the secured loan so that you don't stand to lose the collateral at risk. Remember that even a single default on your personal loan could trigger unexpected after effects in the repayment of your current loan and getting a future loan. In cases of the first default, it is ideal for you to talk to your lender and find a way out. Under normal circumstances the lender could impose a penalty of roughly around 2% on the default amount, which will only add to your current burden! So strive to discuss any problems you face with the lender to seek advise on possible solutions. A personal loan is always a risky alternative finance with a higher rate of interest and it is better to close the loan as early as possible. Evaluate other options before you take up a personal loan In a case of any eventuality you could try the other time tested avenues of finding emergency funds. Monetizing your assets, or selling off your shares, bonds or debentures or premature closing of your fixed deposit could help! If you are a salaried individual the best way to get funds to meet a contingency is to approach the bank where your salary credit is done. Having known your track record and your exact income and withdrawal transactions, the banks are the best option available for you to secure a loan. The rate of interest could be relatively lower for you, as you bank with them. The same option holds good for any businessman having a current/savings account with a bank. You should opt for a personal loan only if you do not have any assets to monetize or other options don't work for you as interest rates are the highest next to only credit cards! |
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