Milliman India EB Herald, August 2013

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By Ravi Shekhar, Simon Herborn | 01 August 2013

To help keep you abreast of developments in employee benefits, we present here our round-up of interesting news articles in this area over the quarter April-June 2013. We hope you find it informative.

Employees’ Provident Fund Organisation (EPFO) / provident funds

The EPFO continues to make headlines. It has engaged Edelweiss Tokio Life Insurance to offer group term insurance in lieu of the EPFO’s EDLI scheme. Aside from this, it faced a mixed reaction to its proposal to broaden the definition of salary for determining provident fund contributions. It also stated its intention to settle claims within three days, and announced plans for separate courts to deal with contribution defaulters. In addition, we got an early indication of the interest crediting rate for 2013-14 at 8.5% p.a.

If you would like to read the articles in detail:

National Pension System (NPS)

There has been considerable activity in regard to the NPS. The Pension Fund Regulatory and Development Authority (PFRDA) appointed Axis Bank as the trustee bank for the NPS. In addition, it has been engaged in discussions on changing the withdrawal conditions under the NPS to enhance its appeal to small investors. Other points of interest are confirmation of the returns for 2012-13 and the published subscribership figures as of May 2013.

If you would like to read the articles in detail:

Employer-sponsored health insurance coverage

This continues to be a dynamic area. New India Assurance announced its intention to raise the cost of coverage, with a similar moves expected by other providers. A recent survey by insurance broker Marsh has revealed companies are withdrawing coverage for employees' parents under group mediclaim policies, citing rising costs.

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Other topics

The Securities and Exchange Board of India (SEBI) announced an extension to the deadline for companies to align their Employee Stock Option Plans (ESOP) and Employee Stock Purchase Schemes (ESPS) with SEBI regulations. In addition, the SEBI chairman was critical of the mutual fund industry for its failure to expand into pension fund management. Elsewhere, a report from the Reserve Bank of India (RBI) cited concern over the risks of inadequate assessment of the liabilities under government sector pension schemes.

If you would like to read the articles in detail:

Please contact us in case you would like to discuss any of the issues above in greater detail, or any other employee benefit topics. We can be reached at