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EMPLOYEE BENEFITS IN INDIA

EMPLOYEE BENEFITS IN INDIA. - the emerging trends. Population in excess of 1 Billion 35 States and Union Territories 24 Languages 7 Religions 3000 communities. INDIA. Diversity in language, culture and religion Does this diversity extend to employee benefits? Yes & No.

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EMPLOYEE BENEFITS IN INDIA

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  1. EMPLOYEE BENEFITS IN INDIA - the emerging trends

  2. Population in excess of 1 Billion 35 States and Union Territories 24 Languages 7 Religions 3000 communities

  3. INDIA • Diversity in language, culture and religion • Does this diversity extend to employee benefits? • Yes & No

  4. Overview of Employee Benefit Scenario In India Employee Compensation Allowances & Bonus Employee Benefits Salary

  5. Mandatory Voluntary Overview of Employee Benefit Scenario In India Employee Benefits Life Insurance Leave Encashment Provident Fund Gratuity Super-annuation Mediclaim Personal Accident

  6. Employee Benefits – Insurance Co’s viewpoint Employee Benefits Insurance Retirement Accident Mediclaim Life Leave Encashment Superannuation Gratuity Defined Benefit Defined Contribution

  7. Mediclaim Insurance • Reimbursement of medical expenses following hospitalization • Cash less hospitalization facility available under certain plans • Tax deduction available for the business Accident Insurance • Can offer compensation for any/all of the following: • Accidental death, disability • Medical expenses for treatment post accident • List of exclusions • BOTH BENEFITS ARE OFFERED BY NON-LIFE INSURANCE COMPANIES

  8. Life Insurance • Benefit payable on accidental/natural death (limited exclusions) • Convenient eligibility conditions • Additional Optional riders • PROVIDED BY LIFE INSURANCE COMPANIES Life Insurance – Trends • Monopoly of one single company so far • Increasing popularity amongst employers/ employees • General cover is about 3 to 5 times the gross annual salary • Companies with huge staff strength opt for profit-sharing

  9. Leave Encashment –Defined benefit • For whom? • If company offers encashment of leave, all employees • What benefit? • Will be based on the company policy. • Normally x days salary for each accumulated day of leave • How Funded? • Institute of Chartered Accountants of India require that a provision be made for the liability. • No special tax benefits for self-funding through a trust • Insurance plans available to manage the funds

  10. Gratuity – Defined Benefit • For whom? • Engaged in Factories, Mines, Plantations, Railways, Shops and establishments notified by Government • In service for 5 successive years • What benefit? • 15 days wages for each year of service • Maximum limit Rs 3,50,000/ • 7 days wages per season for seasonal occupation • How Funded? • Can be funded our unfunded. • Special tax concessions if funded through a trust or insurance company

  11. Superannuation – Defined Contribution/ benefit • For whom? • Non-mandatory, defined by company policy • What benefit? • Can be defined benefit(certain formula of last drawn salary) /defined contribution(certain %age of salary every month contributed to a fund) • Can be different for different grades • How Funded? • Can be funded our unfunded. • Special tax concessions if funded through a trust or insurance company

  12. Retirement Benefits - Trends • Only one life insurance company in the market till 2000 • Offered a cash-accumulation conventional scheme • More and more companies now funding through Insurance • Unit-linked – a preferred platform • Pensions benefits - from Defined Benefit to defined contribution

  13. HDFC STANDARD LIFE INSURANCE HDFC SL is Insurope’s network partner in India

  14. Employee Benefits – Insurance Co’s viewpoint Employee Benefits Insurance Retirement Accident Mediclaim Life Leave Encashment Superannuation Gratuity Defined Benefit Defined Contribution

  15. Employee Benefits – Insurance Co’s viewpoint Employee Benefits Insurance Retirement Accident Mediclaim Life Leave Encashment Superannuation Gratuity Defined Benefit Defined Contribution

  16. Contact Details Sanjeev Kapur Head - Group Sales • (+91) 98203 48755 • Sanjeevk@hdfcinsurance.com • Vijay Vaidyanathan • Manager – Group Sales • (+91) 98206 11998 • vijayv@hdfcinsurance.com

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