Sr.no 1.

introduction

INDEX

2. History of insurance sector 3. Important mile stone in Indian insurance business 4. Insurance awareness present scenerio . Insurance company in india !. "ife insurance corporation #. $reas of future %rowt& 'awareness (. )onsumer protection 'awareness *. Information 'awareness of ma+or insurance policy 1,. -eneral insurance 11. .uture %rowt& in insurance 12. conclusion

Insurance awareness in India 1. Introduction

/&e Insurance sector in India %o0erned by Insurance $ct1 1*3(1 t&e "ife Insurance )orporation $ct1 1* ! and -eneral Insurance 2usiness 3Nationalisation4 $ct1 1*#21 Insurance 5e%ulatory and De0elopment $ut&ority 3I5D$4 $ct1 1*** and ot&er related $cts. 6it& suc& a lar%e population and t&e untapped mar7et area of t&is population Insurance &appens to be a 0ery bi% opportunity in India. /oday it stands as a business %rowin% at t&e rate of 1 82, per cent annually. /o%et&er wit& ban7in% ser0ices1 it adds about # per cent to t&e country9s -D: .In spite of all t&is %rowt& t&e statistics of t&e penetration of t&e insurance in t&e country is 0ery poor. Nearly (,; of Indian populations are wit&out "ife insurance co0er and t&e Healt& insurance. /&is is an indicator t&at %rowt& potential for t&e insurance sector is immense in India. It was due to t&is immense %rowt& t&at t&e re%ulations were introduced in t&e insurance sector and in continuation <=al&otra )ommittee> was constituted by t&e %o0ernment in 1**3 to e?amine t&e 0arious aspects of t&e industry. /&e 7ey element of t&e reform process was :articipation of o0erseas insurance companies wit& 2!; capital. )reatin% a more efficient and competiti0e financial system suitable for t&e re@uirements of t&e economy was t&e main idea be&ind t&is reform. Since t&en t&e insurance industry &as %one t&rou%& many sea c&an%es. /&e competition "I) started facin% from t&ese companies were t&reatenin% to t&e e?istence of "I) .since t&e liberaliAation of t&e industry t&e insurance industry &as ne0er

loo7ed bac7 and today stand as t&e one of t&e most competiti0e and e?plorin% industry in India. /&e entry of t&e pri0ate players and t&e increased use of t&e new distribution are in t&e limeli%&t today. /&e use of new distribution tec&ni@ues and t&e I/ tools &as increased t&e scope of t&e industry in t&e lon%er run. 2. History of Insurance Sector

/&e insurance sector in India &as completed all t&e facets of competition B from bein% an open competiti0e mar7et to bein% nationaliAed and t&en %ettin% bac7 to t&e form of a liberaliAed mar7et once a%ain. /&e &istory of t&e insurance sector in India re0eals t&at it &as witnessed complete dynamism for t&e past two centuries appro?imately. 6it& t&e establis&ment of t&e Criental "ife Insurance )ompany in Dol7ata1 t&e business of Indian life insurance started in t&e year 1(1(. Important milestones in t&e Indian life insurance business 1*12E /&e Indian "ife $ssurance )ompanies $ct came into force for re%ulatin% t&e life insurance business. 1*2(E /&e Indian Insurance )ompanies $ct was enacted for enablin% t&e %o0ernment to collect statistical information on bot& life and non8life insurance businesses. 1*3(E /&e earlier le%islation consolidated t&e Insurance $ct wit& t&e aim of safe%uardin% t&e interests of t&e insurin% public.

1* !E 24

Indian and forei%n insurers and pro0ident societies

were ta7en o0er by t&e central %o0ernment and t&ey %ot nationaliAed. "I) was formed by an $ct of :arliament1 0iA. "I) $ct1 1* !. It started off wit& a capital of 5s. from t&e -o0ernment of India. /&e &istory of %eneral insurance business in India can be traced bac7 to /riton Insurance )ompany "td. 3t&e first %eneral insurance company4 w&ic& was formed in t&e year 1( , in Dol7ata by t&e 2ritis&. Important milestones in t&e Indian %eneral insurance business 1*,#E /&e Indian =ercantile Insurance "td. was set up w&ic& was t&e first company of its type to transact all %eneral insurance business. 1* #E -eneral Insurance )ouncil1 an arm of t&e Insurance $ssociation of India1 framed a code of conduct for %uaranteein% fair conduct and sound business patterns. 1*!(E /&e Insurance $ct impro0ed for re%ulatin% in0estments and set minimal sol0ency le0els and t&e /ariff $d0isory )ommittee was set up. 1*#2E /&e -eneral Insurance 2usiness 3NationaliAation4 $ct1 1*#2 nationaliAed t&e %eneral insurance business in India. It was wit& effect from 1st Fanuary 1*#3. crore and t&at too

1,# insurers inte%rated and %rouped into four companies 0iA. t&e National Insurance )ompany "td.1 t&e New India $ssurance )ompany "td.1 t&e Criental Insurance )ompany "td. and t&e Gnited India Insurance )ompany "td. -I) was incorporated as a company. 3. Insurance awareness B :resentE

/&e insurance sector was opened up for pri0ate participation four years a%o. .or years now1 t&e pri0ate players are acti0e in t&e liberaliAed en0ironment. /&e insurance mar7et &a0e witnessed dynamic c&an%es w&ic& includes presence of a fairly lar%e number of insurers bot& life and non8life se%ment. =ost of t&e pri0ate insurance companies &a0e formed +oint 0enture partnerin% well reco%niAed forei%n players across t&e %lobe. /&ere are now 2* insurance companies operatin% in t&e Indian mar7et B 14 pri0ate life insurers1 nine pri0ate non8life insurers and si? public sector companies. 6it& many more +oint 0entures in t&e offin%1 t&e insurance industry in India today stands at a crossroads as competition intensifies and companies prepare sur0i0al strate%ies in a detariffed scenario. /&ere is pressure from bot& wit&in t&e country and outside on t&e -o0ernment to increase t&e forei%n direct in0estment 3.DI4 limit from t&e current 2!; to 4*;1 w&ic& would &elp FH partners to brin% in funds for e?pansion. /&ere are opportunities in t&e pensions sector w&ere re%ulations are bein% framed. "ess t&an 1, ; of Indians abo0e t&e a%e of !,

recei0e pensions. /&e I5D$ &as issued t&e first licence for a standalone &ealt& company in t&e country as many more players wait to enter. /&e &ealt& insurance sector &as tremendous %rowt& potential1 and as it matures and new players enter1 product inno0ation and en&ancement will increase. /&e deepenin% of t&e &ealt& database o0er time will also allow players to de0elop and price products for lar%er se%ments of society. State Insurers )ontinue /o Dominate /&ere may be room for many more players in a lar%e underinsured mar7et li7e India wit& a population of o0er one billion. 2ut t&e reality is t&at t&e intense competition in t&e last fi0e years &as made it difficult for new entrants to 7eep pace wit& t&e leaders and t&ereby failin% to ma7e any impact in t&e mar7et. $lso as t&e pri0ate sector controls o0er 2!.1(; of t&e life insurance mar7et and o0er 2!. 3; of t&e non8life mar7et1 t&e public sector companies still call t&e s&ots. /&e country9s lar%est life insurer1 "ife Insurance )orporation of India 3"I)41 &ad a s&are of #4.(2; in new business premium income in No0ember 2,, . Similarly1 t&e four public8sector non8life insurers B New India $ssurance1 National Insurance1 Criental Insurance and Gnited India Insurance B &ad a combined mar7et s&are of #3.4#; as of Cctober 2,, . I)I)I :rudential "ife Insurance )ompany continues to lead t&e pri0ate sector wit& a #.2!; mar7et s&are in terms of fres& premium1 w&ereas I)I)I "ombard -eneral

Insurance )ompany is t&e leader amon% t&e pri0ate non8life players wit& a (.11; mar7et s&are. I)I)I "ombard &as focused on %rowin% t&e mar7et for %eneral insurance products and increasin% penetration wit&in e?istin% customers t&rou%& product inno0ation and distribution. 5eac&in% Cut /o )ustomers B No doubt1 t&e customer profile in t&e insurance industry is c&an%in% wit& t&e introduction of lar%e number of di0er%ent intermediaries suc& as bro7ers1 corporate a%ents1 and bancassurance. /&e industry now deals wit& customers w&o 7now w&at t&ey want and w&en1 and are more demandin% in terms of better ser0ice and speedier responses. 6it& t&e industry all set to mo0e to a detariffed re%ime by 2,,#1 t&ere will be considerable impro0ement in customer ser0ice le0els1 product inno0ation and newer standards of underwritin%. Intense )ompetition B In a de8tariffed en0ironment1 competition will manifest itself in prices1 products1 underwritin% criteria1 inno0ati0e sales met&ods and creditwort&iness. Insurance companies will 0ie wit& eac& ot&er to capture mar7et s&are t&rou%& better pricin% and client se%mentation. /&e battle &as so far been fou%&t in t&e bi% urban cities1 but in t&e ne?t few years1 increased competition will dri0e insurers to rural and semi8urban mar7ets.

-lobal Standards B 6&ile t&e world is eyein% India for %rowt& and e?pansion1 Indian companies are becomin% increasin%ly world class. /a7e t&e case of "I)1 w&ic& &as set its si%&t on becomin% a ma+or %lobal player followin% a 5s2(,8crore in0estment from t&e Indian %o0ernment. /&e company now operates in =auritius1 .i+i1 t&e GD1 Sri "an7a1 Nepal and will soon start operations in Saudi $rabia. It also plans to 0enture into t&e $frican and $sia8:acific re%ions in 2,,!. /&e year 2,, continent. Howe0er1 wit& robust reinsurance pro%rammes in place1 insurers &a0e successfully mana%ed to tide o0er t&e crisis wit&out any ad0erse impact on t&eir balance s&eets. 6it& life insurance premiums bein% +ust 2. ; of -D: and %eneral insurance premiums bein% ,.! ; of -D:1 t&e opportunities in t&e Indian mar7et place is immense. /&e ne?t fi0e years will be c&allen%in% but t&ose t&at can build scale and mar7et s&are will sur0i0e and prosper. Insurance companies in India I5D$ &as till now pro0ided re%istration to 12 pri0ate life insurance companies and * %eneral insurance companies. If t&e e?istin% public sector insurance companies are considered t&en t&ere are presently 13 insurance companies in t&e life side and 13 companies functionin% in %eneral insurance business. -eneral was a testin% p&ase for t&e %eneral insurance

industry wit& a series of catastrop&es &ittin% t&e Indian sub8

Insurance )orporation &as been sanctioned as t&e IIndian reinsurerI for underwritin% only reinsurance business. Insurers Insurance industry1 as on 1.4.2,,,1 comprised mainly two playersE t&e state insurersE "ife InsurersE "ife Insurance )orporation of India 3"I)4 -eneral InsurersE -eneral Insurance )orporation of India 3-I)4 3wit& effect from DecJ2,,,1 a National 5einsurer4 -I) &ad four subsidary companies1 namely 3wit& effect from DecJ2,,,1 t&ese subsidaries &a0e been de8lin7ed from t&e parent company and made as independent insurance companies. /&e Criental Insurance )ompany "imited /&e New India $ssurance )ompany "imited National Insurance )ompany "imited Gnited India Insurance )ompany "imited. "ist of Insurance companies in India "I.E INSG5E5S :ublic Sector "ife Insurance )orporation of India :ri0ate Sector $llianA 2a+a+ "ife Insurance )ompany www.allianAba+a+.co.in www.licindia.com 6ebsites

"imited 2irla Sun8"ife Insurance )ompany "imited HD.) Standard "ife Insurance )o. "imited I)I)I :rudential "ife Insurance )o. "imited IN- Hysya "ife Insurance )ompany "imited =a? New Kor7 "ife Insurance )o. "imited =et"ife Insurance )ompany "imited www.birlasunlife.com www.&dfcinsurance.com www.iciciprulife.com www.in%0ysayalife.com www.ma?newyor7life.com www.metlife.com

"ife Insurance )orporation of India 3"I)4 "ife Insurance )orporation of India 3"I)4 was formed in September1 1* ! by an $ct of :arliament1 0iA.1 "ife Insurance )orporation $ct1 1* !1 wit& capital contribution from t&e -o0ernment of India. /&e t&en .inance =inister1 S&ri ).D. Des&mu7&1 w&ile pilotin% t&e bill1 outlined t&e ob+ecti0es of "I) t&usE to conduct t&e business wit& t&e utmost economy1 in a spirit of trustees&ipL to c&ar%e premium no &i%&er t&an warranted by strict actuarial considerationsL to in0est t&e funds for obtainin% ma?imum yield for t&e policy &olders consistent wit& safety of t&e capitalL to render prompt and efficient ser0ice to policy &olders1 t&ereby ma7in% insurance widely popular. Since nationalisation1 "I) &as built up a 0ast networ7 of 21,4( branc&es1 1,, di0isions and # Aonal offices spread o0er t&e country. /&e "ife Insurance )orporation of India also transacts business abroad and &as offices in .i+i1 =auritius and Gnited

Din%dom. "I) is associated wit& +oint 0entures abroad in t&e field of insurance1 namely1 Den8India $ssurance )ompany "imited1 NairobiL Gnited Criental $ssurance )ompany "imited1 Duala "umpur and "ife Insurance )orporation 3International4 E.). 2a&rain. /&e )orporation &as re%istered a +oint 0enture company in 2!t& December1 2,,, in Dat&mandu1 Nepal by t&e name of "ife Insurance )orporation 3Nepal4 "imited in collaboration wit& His&al -roup "imited1 a local industrial -roup. $n off8s&ore company ".I.). 3=auritius4 Cff8s&ore "imited &as also been set up in 2,,1 to tap t&e $frican insurance mar7et.

Some $reas of .uture -rowt&'awareness "ife Insurance /&e traditional life insurance business for t&e "I) &as been a little more t&an a sa0in%s policy. /erm life 3w&ere t&e insurance company pays a predetermined amount if t&e policy&older dies wit&in a %i0en time but it pays not&in% if t&e policy&older does not die4 &as accounted for less t&an 2; of t&e insurance premium of t&e "I) 3=itra and Naya71 2,,14. .or t&e new life insurance companies1 term life policies would be t&e main line of business. Healt& Insurance Healt& insurance e?penditure in India is rou%&ly !; of -D:1 muc& &i%&er t&an most ot&er countries wit& t&e same le0el of economic de0elopment. Cf t&at1 4.#; is pri0ate and t&e rest is public. 6&at is e0en more stri7in% is t&at 4. ; are out of poc7et e?penditure 32erman1 1**!4. /&ere &as been an almost total

failure of t&e public &ealt& care system in India. /&is creates an opportunity for t&e new insurance companies. /&us1 pri0ate insurance companies will be able to sell &ealt& insurance to a 0ast number of families w&o would li7e to &a0e &ealt& care co0er but do not &a0e it. :ension /&e pension system in India is in its infancy. /&ere are %enerally t&ree forms of plansE pro0ident funds1 %ratuities and pension funds. =ost of t&e pension sc&emes are confined to %o0ernment employees 3and some lar%e companies4. /&e 0ast ma+ority of wor7ers are in t&e informal sector. $s a result1 most wor7ers do not &a0e any retirement benefits to fall bac7 on after retirement. /otal assets of all t&e pension plans in India amount to less t&an GSD 4, billion. /&erefore1 t&ere is a &u%e scope for t&e de0elopment of pension funds in India. /&e finance minister of India &as repeatedly asserted t&at a "atin $merican style reform of t&e pri0atiAed pension system in India would be welcome 35oy1 1**#4. -i0en all t&e pros and cons1 it is not clear w&et&er suc& a w&olesale pri0atiAation would really benefit India or not 3Sin&a1 2,,,4. =ar7et S&are of Indian Insurance Industry /&e introduction of pri0ate players in t&e industry &as added 0alue to t&e industry. /&e initiati0es ta7en by t&e pri0ate players are 0ery competiti0e and &a0e %i0en immense competition to t&e on time monopoly of t&e mar7et "I). Since t&e ad0ent of t&e pri0ate players in t&e mar7et t&e industry &as seen new and inno0ati0e steps ta7en by t&e players in t&is sector. /&e new

players &a0e impro0ed t&e ser0ice @uality of t&e insurance. $s a result "I) down t&e years &a0e seen t&e declinin% p&ase in its career. /&e mar7et s&are was distributed amon% t&e pri0ate players. /&ou%& "I) still &olds t&e # ; of t&e insurance sector but t&e upcomin% natures of t&ese pri0ate players are enou%& to %i0e more competition to "I) in t&e near future. "I) mar7et s&are &as decreased from * ; 32,,28,34 to (1 ;3 2,,48, 4./&e followin% companies &as t&e rest of t&e mar7et s&are of t&e insurance industry. /able 3 s&ows t&e mane of t&e player in t&e mar7et. Insurance 2usinessE Insurance business is di0ided into four classes E 14 "ife Insurance 24 .ire Insurance 34 =arine Insurance and 44 =iscellaneous Insurance. "ife Insurers transact life insurance businessL -eneral Insurers transact t&e rest. No composites are permitted as per law. "e%islation 3as on 1.4.2,,,4E Insurance is a federal sub+ect in India. /&e primary le%islation t&at deals wit& insurance business in India isE Insurance $ct1 1*3(1 and Insurance 5e%ulatory '

De0elopment $ut&ority $ct1 1***.

"ife InsuranceE :opular :roductsE Endowment $ssurance 3:articipatin%41 and =oney 2ac7 3:articipatin%4. =ore t&an (,; of t&e life insurance business is from t&ese products. -eneral InsuranceE .ire and =iscellaneous insurance businesses are predominant. =otor He&icle insurance is compulsory. /ariff $d0isory )ommittee 3/$)4 lays down tariff rates for some of t&e %eneral insurance products 3please 0isit website of -I) for details4 Information $bout t&e insurance industry1 t&e followin% documents may be &elpfulE

=al&otra )ommittee 5eport 3/&e 5eport of t&en

)ommittee on 5eforms in t&e Insurance Sector4L I5D$Js .irst $nnual 5eport B 2,,1 )ustomer :rotection and awarenessE Insurance Industry &as Cmbudsmen in 12 cities. Eac& Cmbudsman is empowered to redress customer %rie0ances in respect of insurance contracts on personal lines w&ere t&e insured amount is less t&an 5s. 2, la7&s1 in accordance wit& t&e Cmbudsman Sc&eme. $ddresses can be obtained from t&e offices of "I) and ot&er insurers.

:rotection of t&e interest of policy &oldersE I5D$ &as t&e responsibility of protectin% t&e interest of insurance policy&olders. /owards ac&ie0in% t&is ob+ecti0e1 t&e $ut&ority &as ta7en t&e followin% stepsE I5D$ &as notified :rotection of :olicy&olders Interest

5e%ulations 2,,1 to pro0ide forE policy proposal documents in easily understandable lan%ua%eL claims procedure in bot& life and non8lifeL settin% up of %rie0ance redressal mac&ineryL speedy settlement of claimsL and policy&oldersJ ser0icin%. /&e 5e%ulation also pro0ides for payment of interest by insurers for t&e delay in settlement of claim. /&e insurers are re@uired to maintain sol0ency mar%ins so t&at t&ey are in a position to meet t&eir obli%ations towards policy&olders wit& re%ard to payment of claims. It is obli%atory on t&e part of t&e insurance companies to disclose clearly t&e benefits1 terms and conditions under t&e policy. /&e ad0ertisements issued by t&e insurers s&ould not mislead t&e insurin% public. $ll insurers are re@uired to set up proper %rie0ance redress mac&inery in t&eir &ead office and at t&eir ot&er offices. /&e $ut&ority ta7es up wit& t&e insurers any complaint recei0ed from t&e policy&olders in connection wit& ser0ices pro0ided by t&em under t&e insurance contract. 5ecent Scenario of Insurance Industry

 India wit& about 2,, million middle class &ouse&old s&ows a &u%e untapped potential for players in t&e insurance industry. Saturation of mar7ets in many de0eloped economies &as made t&e Indian mar7et e0en more attracti0e for %lobal insurance ma+ors. /&e insurance sector in India &as come to a position of 0ery &i%& potential and competiti0eness in t&e mar7et. Indians1 &a0e always seen life insurance as a ta? sa0in% de0ice1 are now suddenly turnin% to t&e pri0ate sector t&at are pro0idin% t&em new products and 0ariety for t&eir c&oice. )onsumers remain t&e most important centre of t&e insurance sector. $fter t&e entry of t&e forei%n players t&e industry is seein% a lot of competition and t&us impro0ement of t&e customer ser0ice in t&e industry. )omputerisation of operations and updatin% of tec&nolo%y &as become imperati0e in t&e current scenario. .orei%n players are brin%in% in international best practices in ser0ice t&rou%& use of latest tec&nolo%ies /&e insurance a%ents still remain t&e main source t&rou%& w&ic& insurance products are sold. /&e concept is 0ery well establis&ed in t&e country li7e India but still t&e increasin% use of ot&er sources is imperati0e. $t present t&e distribution c&annels t&at are a0ailable in t&e mar7et are listed below.

. .

Direct sellin%

-roup sellin%

2ro7ers and cooperati0e societies 2ancassurance )ustomers &a0e tremendous c&oice from a lar%e 0ariety of products from pure term 3ris74 insurance to unit8lin7ed in0estment products. )ustomers are offered unbundled products wit& a 0ariety of benefits as riders from w&ic& t&ey can c&oose. =ore customers are buyin% products and ser0ices based on t&eir true needs and not +ust traditional moneybac7 policies1 w&ic& is not considered 0ery appropriate for lon%8term protection and sa0in%s. /&ere is lots of sa0in% and in0estment plans in t&e mar7et. Howe0er1 t&ere are still some 7ey new products yet to be introduced 8 e.%. &ealt& products. /&e rural consumer is now e?&ibitin% an increasin% propensity for insurance products. $ researc& conducted e?&ibited t&at t&e rural consumers are willin% to dole out anyt&in% between 5s 31 ,, and 5s 21*,, as premium eac& year. In t&e insurance t&e awareness le0el for life insurance is t&e &i%&est in rural India1 but t&e consumers are also aware about motor1 accidents and cattle insurance. In a study conducted by =$5/ t&e results s&owed t&at nearly

one t&ird said t&at t&ey &ad purc&ased some 7ind of insurance wit& t&e ma?imum penetration s7ewed in fa0or of life insurance. /&e study also pointed out t&e pri0ate companies &a0e &u%e tas7 to play in creatin% awareness and credibility amon% t&e rural populace. /&e percei0ed benefits of buyin% a life policy ran%e from security of income bul7 return in future1 dau%&terJs marria%e1 c&ildrenJs education and %ood return on sa0in%s1 in t&at order. $pplication of Information /ec&nolo%y in Insurance Sector to ma7e people aware E /&ere is an e0olutionary c&an%e in t&e tec&nolo%y t&at &as re0olutioniAed t&e entire insurance sector. Insurance industry is a data8ric& industry1 and t&us1 t&ere is a need to use t&e data for trend analysis and personaliAation. 6it& increased competition amon% insurers1 ser0ice &as become a 7ey t&e issue. current =oreo0er1 0alue customers are t&ey %ettin% want increasin%ly personaliAed sop&isticated and tec&8sa00y. :eople today don9t want to accept propositions1 interactions and t&ey loo7 for more and more features and add ones and better ser0ice /&e insurance companies today must meet t&e need of t&e &our for more and more personaliAed approac& for &andlin% t&e customer. /oday mana%in% t&e customer intelli%ently is 0ery critical for t&e insurer especially in t&e 0ery competiti0e en0ironment. )ompanies need to apply different set of rules and treatment strate%ies to different customer se%ments. Howe0er1 to

personaliAe interactions1 insurers are re@uired to capture customer information in an inte%rated system. 6it& t&e e?plosion of 6ebsite and %reater access to direct product or policy information1 t&ere is a need to de0elopin% better tec&ni@ues to %i0e customers a truly personaliAed e?perience. :ersonaliAation &elps or%aniAations to reac& t&eir customers wit& more impact and to %enerate new re0enue t&rou%& cross sellin% and up sellin% acti0ities. /o ensure t&at t&e customers are recei0in% personaliAed information1 many or%aniAations are incorporatin% 7nowled%e database8repositories of content t&at typically include a searc& en%ine and lets t&e customers locate t&e all document and information related to t&eir @ueries of re@uest for ser0ices. )ustomers can &ereby use t&e 7nowled%e database to man%e t&eir products or t&e company information and in0oices1 claim records1 and &istories of t&e ser0ice in@uiry. /&ese products also may be able to learn from t&e customer9s pre0ious 7nowled%e database and to use t&eir information w&en determinin% t&e rele0ance to t&e customers searc& re@uest.

6H$/ IS "I.E INSG5$N)E IN INDI$M "ife insurance made its debut in India well o0er 1,, years a%o. Its salient features are not as widely understood in our country as t&ey ou%&t to be. 6&at follows is an attempt to ac@uaint readers wit& some of t&e concepts of life insurance1 wit& special reference to life insurance. It s&ould1 &owe0er1 be clearly understood t&at t&e followin% narration is by no means an e?&austi0e description of t&e terms and conditions of a life insurance policy or its benefits or pri0ile%es. .or more details1 please contact our 2ranc& or

Di0isional Cffice. $ny life insurance $%ent will be %lad to &elp you c&oose t&e life insurance plan to meet your needs and render policy ser0icin%. "ife Insurance sector is t&e fastest %rowin% sector in India since 2,,, w&en t&e -o0ernment allowed :ri0ate players and .DI N.orei%n Direct In0estmentO up to 2!;. "ife Insurance in India was nationaliAed by incorporatin% "ife Insurance )orporation 3"I)4 in 1* !. $ll pri0ate life insurance companies at t&at time were ta7en o0er by "I). In 2,,,1 t&e le%islation amendin% t&e Insurance $ct of 1*3( and le%islatin% t&e Insurance 5e%ulatory and De0elopment $ut&ority $ct of 2,,, was passed1 w&ere in t&e newly appointed insurance re%ulator 8 Insurance 5e%ulatory and De0elopment $ut&ority NI5D$O started to issue licenses to pri0ate life insurers. 6&at is "ife InsuranceM "ife Insurance is a contract for payment of a sum of money to t&e person assured 3or failin% &imP&er1 to t&e person entitled to recei0e t&e same4 on t&e &appenin% of t&e e0ent insured a%ainst. Gsually t&e contract pro0ides for t&e payment of an amount on t&e date of maturity or at specified dates at periodic inter0als or at unfortunate deat&1 if it occurs earlier. $mon% ot&er t&in%s1 t&e contract also pro0ides for t&e payment of premium periodically to t&e )orporation by t&e assured. "ife insurance is uni0ersally ac7nowled%ed to be an institution w&ic& eliminates Jris7J1 substitutin% certainty for uncertainty and comes to t&e timely aid of t&e family in t&e unfortunate e0ent of deat& of t&e breadwinner. 2y and lar%e1 life insurance is ci0ilisationJs partial solution to t&e

problems caused by deat&. "ife insurance1 in s&ort1 is concerned wit& two &aAards t&at stand across t&e life8pat& of e0ery personE t&at of dyin% prematurely lea0in% a dependent family to fend for itself and t&at of li0in% to old a%e wit&out 0isible means of support. 6&y is it superior to ot&er forms of Sa0in%sM :rotectionE Sa0in%s t&rou%& life insurance %uarantee full protection a%ainst ris7 of deat& of t&e sa0er. In life insurance1 on deat&1 t&e full sum assured is payable 3wit& bonuses w&ere0er applicable4 w&ereas in ot&er sa0in%s sc&emes1 only t&e amount sa0ed 3wit& interest4 is payable. $id /o /&riftE "ife insurance encoura%es Jt&riftJ. "on% term sa0in% can be made in a relati0ely JpainlessJ manner because of t&e Jeasy instalmentJ facility built into t&e sc&eme 3met&od of payin% premium eit&er mont&ly1 @uarterly1 &alf yearly or yearly4. /a7e1 for e?ample1 our Salary Sa0in% Sc&eme popularly 7nown as SSS. /&is sc&eme pro0ides a con0enient met&od of payin% premium eac& mont& by deduction from oneJs salary. /&e deducted premium is remitted by t&e employer to t&e "I). /&e Salary Sa0in% Sc&eme can be introduced in an institution or establis&ment sub+ect to specified terms and conditions. "i@uidityE "oans can be raised on t&e sole security of a policy w&ic& &as ac@uired loan 0alue. 2esides1 a life insurance policy is also %enerally accepted as security for e0en a commercial loan. /a? 5eliefE /a? relief in Income /a? and 6ealt& /a? is a0ailable for amounts paid by way of premium for life insurance sub+ect to Income /a? rates in force. $ssessees can a0ail t&emsel0es of

pro0isions in t&e law for ta? relief. In suc& cases t&e assured in effect pays a lower premium for &is insurance t&an &e would &a0e to pay ot&erwise. =oney 6&en Kou Need ItE $ suitable insurance plan or a combination of different plans can be ta7en out to meet specific needs t&at are li7ely to arise in future1 suc& as c&ildrenJs education1 start8in8life or marria%e pro0ision or e0en periodical needs for cas& o0er a stretc& of time. $lternati0ely1 policy moneys can be so arran%ed to be made a0ailable at t&e time of oneJs retirement from ser0ice to be used for any specific purpose1 suc& as for t&e purc&ase of a &ouse or for ot&er in0estments. Sub+ect to certain conditions1 loans are %ranted to policy&olders for &ouse buildin% or for purc&ase of flats. 6&o )an 2uy $ "ife Insurance :olicyM $ny person w&o &as attained ma+ority and is eli%ible to enter into a 0alid contract can ta7e out a life insurance policy for &imself and on t&ose in w&om &e &as insurable interest. :olicies can also be ta7en out1 sub+ect to certain conditions1 on t&e life of oneJs spouse or c&ildren. 6&ile underwritin% proposals1 factors suc& as t&e state of &ealt& of t&e life to be assured1 t&e proponentJs income and ot&er rele0ant factors are considered by t&e )orporation. Insurance Cn 6omen. :rior to nationaliAation 31* !41 many of t&e pri0ate insurance companies used to offer insurance to female li0es wit& some e?tra premium or on restricti0e conditions. $fter nationaliAation of life insurance1 t&e terms under w&ic& life insurance is %ranted to female li0es &a0e been re0iewed from time to time. $t present1

women wit& earned income are treated on par wit& male li0es. In ot&er cases1 a restricti0e clause is imposed and t&at too only if a%e of t&e female is up to 3, years and if s&e does not &a0e an income attractin% Income /a?. =edical $nd Non8=edical Sc&emes. "ife insurance is normally offered after a medical e?amination of t&e life to be assured. Howe0er1 to facilitate %reater spread of insurance and also as a measure of rela?ation1 "I) &as been e?tendin% insurance co0er wit&out any medical e?amination1 sub+ect to certain conditions. 6it& :rofit $nd 6it&out :rofit :lans. $n insurance policy can be Jwit&J or Jwit&outJ profit. In t&e former1 bonuses disclosed1 if any1 after periodical 0aluations are allotted to t&e policy and are payable alon%wit& t&e contracted amount. In Jwit&outJ profit plan t&e contracted amount is paid wit&out any addition. /&e premium rate c&ar%ed for a Jwit&J profit policy is t&erefore &i%&er t&an for a Jwit&outJ profit policy. Deyman Insurance. Deyman Insurance is ta7en by a business firm on t&e life of 7ey employee3s4 to pro+ect t&e firm a%ainst t&e finance loss w&ic& may occur due to t&e premature demise of t&e Deyman. "ife Insurance is t&e fastest %rowin% sector in India since 2,,, as -o0ernment allowed :ri0ate players and .DI up to 2!;. "ife Insurance in India was nationalised by incorporatin% "ife Insurance )orporation 3"I)4 in 1* !. $ll pri0ate life insurance companies at t&at time were ta7en o0er by "I).

In 1**3 t&e -o0ernment of 5epublic of India appointed 5N =al&otra )ommittee to lay down a road map for pri0atisation of t&e life insurance sector. 6&ile t&e committee submitted its report in 1**41 it too7 anot&er si? years before t&e enablin% le%islation was passed in t&e year 2,,,1 le%islation amendin% t&e Insurance $ct of 1*3( and le%islatin% t&e Insurance 5e%ulatory and De0elopment $ut&ority $ct of 2,,,. /&e same year t&at t&e newly appointed insurance re%ulator 8 Insurance 5e%ulatory and De0elopment $ut&ority I5D$ 88 started issuin% licenses to pri0ate life insurers. "ist of "ife Insurers 3as of Sept1 2,,(4 $part from "ife Insurance )orporation1 t&e public sector life insurer1 t&ere are 2, ot&er pri0ate sector life insurers1 most of t&em +oint 0entures between Indian %roups and %lobal insurance %iants. "ife Insurer in :ublic Sector 1. "ife Insurance )orporation of India "ife Insurers in :ri0ate Sector 1. S2I "ife Insurance 2. =etlife India "ife Insurance 3. I)I)I :rudential "ife Insurance 4. 2a+a+ $llianA "ife . =a? New Kor7 "ife Insurance !. Sa&ara "ife Insurance 7. /ata $I- "ife (. HD.) Standard "ife *. 2irla Sunlife 1,.Dota7 "ife Insurance 11.$0i0a "ife Insurance 12.5eliance "ife Insurance )ompany "imited 8 .ormerly 7nown as $=: Sanmar "I) 13. IN- Hysya "ife Insurance 14.S&riram "ife Insurance 15. 2&arti $X$ "ife Insurance )o "td

1!..uture -enerali "ife Insurance )o "td 1#.ID2I .ortis "ife Insurance 18. $E-CN 5eli%are "ife Insurance 1*.D". :ramerica "ife Insurance 2,.)$N$5$ HS2) Criental 2an7 of )ommerce "I.E INSG5$N)E .orei%n Direct In0estment 3.DI4 :olicy in Insurance Sector $s per t&e current 3=ar ,!4 .DI norms1 forei%n participation in an Indian insurance company is restricted to 2!.,; of its e@uity P ordinary s&are capital. /&e Gnion 2ud%et for fiscal 2,, &ad recommended t&at t&e ceilin% on forei%n &oldin% be increased to 4*.,;. /&e %o0ernment appro0ed t&e muc&8awaited compre&ensi0e Insurance 2ill t&at see7s to raise forei%n direct in0estment 3.DI4 cap in pri0ate sector to 4* per cent from 2! per cent. Indian life insurance industry overview $ll life insurance companies in India &a0e to comply wit& t&e strict re%ulations laid out by Insurance 5e%ulatory and De0elopment $ut&ority of India 3I5D$4. /&erefore t&ere is no ris7 in %oin% in for pri0ate insurance players. In terms of bein% rated for financial stren%t& li7e international players1 only I)I)I :rudential is rated by .itc& India at National Insurer .inancial Stren%t& 5atin% of $$$3Ind4 wit& stable outloo7 indicatin% t&e &i%&est claims payin% ability ratin%. "ife Insurance )orporation of India 3"I)41 t&e state owned be&emot&1 remains by far t&e lar%est player in t&e mar7et. $mon% t&e pri0ate sector players1 I)I)I :rudential "ife Insurance3FH

between I)I)I 2an7 and :rudential :")4 is t&e lar%est followed by 2a+a+ $llianA "ife Insurance )ompany "imited 3FH between 2a+a+ -roup and $llianA4.$mon% ot&ers1 Dota7 "ife Insurance emer%in% as a one of t&e best product pro0ider in t&e current mar7et.It &as been estimated t&at customer %rowt& of Dota7 "ife Insurance is better t&an any pri0ate insurance company in India. /&e pri0ate companies are comin% out wit& better products w&ic& are more beneficial to t&e customer. $mon% suc& products are t&e G"I:s or t&e Gnit "in7ed In0estment :lans w&ic& offer bot& life co0er as well as scope for sa0in%s or in0estment options as t&e customer desires..urt&er1 t&ese type of plans are sub+ect to a minimum loc78in period of t&ree years to pre0ent misuse of t&e si%nificant ta? benefits offered to suc& plans under t&e Income /a? $ct. Hence1 comparison of suc& products wit& mutual funds would be erroneous. )ommission P intermediation fees

/&e ma?imum commission limits as per statutory pro0isions areE

$%ency commission for retail life insurance businessE

o

#8 *,; for 1st year premium if t&e premium payin% term is more t&an 2, years #8 1,; for 1st year premium if t&e premium payin% term is more t&an 1 years #8 1,; for 1st year premium if t&e premium payin% term is less t&an 1, years

#; 8 yr 2 and 3rd year and 3. ; 8 t&ereafter for all premium payin% terms.

In case of =utual fund related 8 Gnit lin7ed policies it 0aries between 1. ; to!; on t&e premium paid.
o

$%ency commission for retail pension policies

#. ; for 1st year premium and 2. ; t&ereafter

=a?imum bro7er commission 8 3,; 5eferral fees to ban7s B =a? ; for re%ular premium and

1,; for sin%le premium. Howe0er in any case t&is fee cannot be more t&an t&e a%ency commission as filed under t&e product.

Howe0er1 t&e abo0e commission may be furt&er sub+ect to t&e product wise limits specified by I5D$ w&ile appro0in% t&e product

Information ' awareness of ma+or insurance policy =iscellaneous insurance

=iscellaneous Insurance e?ists to &elp people %ain a %ood understandin% of t&e 0arious 7inds of insurance co0era%eJs t&at are a0ailable to people today. Insurance &as become a 0ery important part of many peopleJs li0es as t&ey realiAe t&e need to pro0ide protection for different areas of t&eir e0eryday life. /&ere is a wide 0ariety of types of insurance co0era%e a0ailable today. /&e dictionary defines insurance as Ico0era%e by contract w&ereby one party underta7es to indemnify or %uarantee anot&er a%ainst loss by a specified contin%ency or perilI. /&is means t&at an indi0idual enters into an a%reement wit& an insurance company t&at will pay a set amount of money in case of a loss in a specified area. /&ere are a number of inclusions and e?clusions in0ol0ed in eac& insurance policy wit& all 7inds of 0ariables t&at must be ta7en into consideration before purc&asin% t&e policy. Cne of t&e most important t&in%s to remember is t&at an insurance policy is a contract between t&e insurance company and t&eir customer. /&e insurance company a%rees to pay certain amounts of money in case of loss and t&e customer a%rees to pay t&e insurance premiums t&at are re@uired to 7eep t&e policy in place. If t&e customer fails to pay t&e premiums due1 t&e insurance may be re0o7ed1 lea0in% t&e customer 0ulnerable. /&e contract specifically ma7es t&e insurance company liable to pay for any loss t&at is specifically stated in t&e insurance policy. =ost policies will accurately describe t&e types of losses co0ered and t&e amount of money t&at t&e company will pay for t&ose losses.

6it& t&e increase in public awareness and t&e conse@uent t&rust of t&e Insurance Industry in t&e areas of Healt& Insurance1 "iability Insurance and ot&er personal lines of insurances1 t&e miscellaneous portfolio of Insurance is poised to be a sunrise portfolio of -eneral Insurance.

2ac7%round 6it& t&e increase in public awareness and conse@uent t&rust of t&e Insurance Industry in t&e areas of Healt& Insurance1 "iability Insurance and ot&er personal lines of insurances1 t&e miscellaneous portfolio of Insurance is poised to be t&e sunrise portfolio of -eneral Insurance business. /&is pro%ramme &as been desi%ned 7eepin% in mind t&ese de0elopments in t&e mar7et and attempts to address t&e need for increased awareness of t&e multidimensional miscellaneous portfolio.

Cb+ecti0es /o en&ance t&e participants understandin% of t&e miscellaneous portfolio

/o ac@uaint t&em wit& 0arious aspects of Healt& and "iability Insurance in conte?t wit& t&e )urrent scenario Help t&em e?plore t&e potential of rural insurance in line wit& t&e

re%ulatory %uidelines.

/o emp&asiAe t&e importance of and e?plore t&e potential of personal line of business under miscellaneous portfolio.

)ontents $nalysis of t&e miscellaneous insurance products

Healt& )are =ana%ement 8 Indian and -lobal :erspecti0e /:$9s an Effecti0e Ser0ice :ro0ider "e%al framewor7 and "iability Insurance :roducts 5ural and Social Sector 8 re%ulations1 product and mar7etin% :ersonal line products 8 potential and mar7etin%1 distribution c&annels Scope and )o0era%e of New :roducts )redit Default )o0er 2an7ers Indemnity InsuranceP Fewelers 2loc7 )o0ersL Stoc7 2ro7ers P Insurance 2ro7ers Indemnity :ac7a%in% ' :roduct De0elopment Special )ontin%ency )o0ers

:articipants9 :rofile E?ecuti0es &andlin% /ec&nical Departments and Cffice In8c&ar%e of operatin% offices of -eneral Insurance )ompanies.

$ccident Insurance $ccident insurance pro0ides a cas& co0er to a policy&older w&en sP&e suffers in+uries as a result of an accident. 6&ile insurance &elps a policy&older pay off &ospital and medical bills in case of accident in+uries1 it pro0ides cas& benefits to family members if t&e policy&older dies in t&e accident. /&is insurance1 applicable 24 &ours a day1 3! days a year1 is also commonly referred to as personal accident insurance. /ypes of :ersonal $ccident Insurance :olicies Gnder personal accident insurance1 t&e policy&older1 if in+ured1 recei0es cas& benefits e0ery mont&1 +ust li7e income1 for as lon% as sP&e is unable to wor7 due to t&e accidental in+uries. /&is income is non8ta?able and does not e?ceed t&e policy&older9s after8ta? earnin%s minus t&e state benefits sP&e can claim. In case of deat& of t&e policy&older due to an accident1 t&e family recei0es a specific lump8sum amount. /&ere are ei%&t common types of personal accident insurance policiesE

Indi0idualE /&is policy can be ta7en by any indi0idual. /&e benefits usually enclose partners and c&ildren. Since se0eral acti0ities are e?cluded from t&is policy1 it is not as useful for people w&o lo0e ad0enturous sports1 li7e mountaineerin% and roc7 climbin%. )&ildrenE /&e purpose of t&is policy is to pro0ide financial &elp to parents if t&ey are unable to wor7 or if t&ey incur e?penses as a result of an accident.

-roupE /&is policy is used by companies to co0er employees for e?penses related to accidents. Self8employedE Since self employed indi0iduals are not eli%ible for employee benefits1 t&ey are worse off w&en in+ured in an accident. /eamE /&rou%& a team accident insurance policy1 or%aniAers can see7 co0er for all t&e members of a sports team. :rofessionalE /&is policy is specifically for self employed professionals1 suc& as a sportsperson1 actor1 lawyer or doctor1 w&o &a0e special re@uirements. C0er ,E /&is policy tar%ets people o0er , years of a%e1 as accidents can cause more %rie0ous in+uries to t&em. /ra0el accidentsE /&is policy offers benefits in case t&e policy&older meets wit& an accident w&ile tra0elin%.

/&ere are 0aried accident insurance policies to suit different needs. Cne s&ould understand and c&oose t&e policy wit& utmost care.

2ur%lary Insurance

6it& t&e increase in materialistic wealt& and boomin% economy1 t&e c&ances of bur%lary in business premises are also increasin%. /o counteract t&e situation and protect t&e &ard earned wealt& of t&e businesspersons1 many insurance companies &a0e come up wit& attracti0e insurance plans t&at promise to pro0ide co0er

a%ainst t&e rise of loss or dama%e in t&e business premises1 due to bur%lary. In India1 a bur%lary insurance 3business premises4 policy %enerally co0ers contents of business premises1 a%ainst t&e ris7 of loss or dama%e by bur%lary and &ousebrea7in%. It is 0ery important to 7now t&e basic clause of t&e insurance plans1 alt&ou%& t&ey may 0ary from company to company. In t&is article1 we &a0e pro0ided t&e basic information t&at you need to 7now1 before optin% for a bur%lary insurance plan. 2ur%lary Insurance :olicy

/&e loss of materialistic wealt& in a business or%aniAation1 due to bur%lary1 is reimbursed by a bur%lary insurance policy. /&e insurance companies pro0ide insurance a%ainst not&in% but bur%lary1 in t&e business premises. /&e property insured is co0ered only if loss or dama%e ta7es place1 w&ile contained in t&e insured premises and not in any ot&er premises. "oss of or dama%e to deeds1 bonds1 bills of e?c&an%e1 promissory notes1 cas&1 treasury notes and ban7 notes1 c&e@ue1 securities for money stamps1 stamp collections1 boo7s of account1 documents of any 7ind1 manuscripts1 medals and coins1 motor 0e&icles1 and li0e stoc7 cannot be claimed under office bur%lary insurance policy in India. Dama%e to property by bur%lars is co0ered only w&en t&e insured is made %ood. In ot&er words1 dama%e to own premises are not co0ered.

6it& re%ard to cas& in loc7ed safe1 t&e 7ey to t&e safe or stron% room s&ould not be left in t&e premises o0erni%&t or at least anyw&ere near t&e safe. $pplicants need to submit t&e proposal form furnis&in% detailed information on t&e location of t&e ris7 and claims &istory. Cften inspection of t&e premises and its nei%&bor&ood is carried out by a%ents or bro7ers or mar7etin% officers of t&e insurance company. :remises located in isolated areas or t&e ad+oinin% premises are t&ose1 w&ic& are not occupied in t&e ni%&t. /&ese may include educational institution or a place of wors&ip1 w&ic& usually do not find fa0or wit& t&e insurers. In order to substantiate a bur%lary insurance claim1 one must produce t&e .I5 and non8detection report from t&e police. /&e insurers will depute and obtain a sur0ey report e0en on t&e stolen %oods1 to determine t&e pro?imate cause of t&e loss and t&e @uantum. Stoc7 boo7s and ot&er accounts are also 0erified before furnis&in% t&e insurance co0er. In some insurance plans1 t&e t&eft is not 0alid1 if it &as been conducted by an internal staff1 or a person w&o didnJt brea7 into t&e business premises.

=otor insurance

He&icle insurance 3also 7nown as auto insurance1 car insurance1 or motor insurance4 is insurance purc&ased for cars1 truc7s1 and ot&er 0e&icles. Its primary use is to pro0ide protection a%ainst losses incurred as a result of traffic accidents and a%ainst liability t&at could be incurred in an accident. "e%ally1 no motor 0e&icle is allowed to be dri0en on t&e road wit&out 0alid insurance. Hence1 it is obli%atory to %et t&e 0e&icle insured. =otor insurance policies co0er a%ainst any loss or dama%e caused to t&e 0e&icle or its accessories due to t&e followin% natural and man made calamities. Natural )alamitiesE .ire1 e?plosion1 self8i%nition or li%&tnin%1 eart&@ua7e1 flood1 typ&oon1 &urricane1 storm1 tempest1 inundation1 cyclone1 &ailstorm1 frost1 landslide1 roc7slide. =an made )alamitiesE 2ur%lary1 t&eft1 riot1 stri7e1 malicious act1 accident by e?ternal means1 terrorist acti0ity1 any dama%e in transit by road1 rail1 inland waterway1 lift1 ele0ator or air. =otor insurance pro0ides compulsory personal accident co0er for indi0idual owners of t&e 0e&icle w&ile dri0in%. Cne can also opt for a personal accident co0er for passen%ers and t&ird party le%al liability. /&ird party le%al liability protects a%ainst le%al liability arisin% due to accidental dama%es. It includes any permanent in+ury P deat& of a person and dama%e caused to t&e property.

/&e 0e&icles are insured at a fi?ed 0alue called t&e InsuredJs Declared Halue 3IDH4. IDH is calculated on t&e basis of t&e manufacturerJs listed sellin% price of t&e 0e&icle 3plus t&e listed price of any accessories4 after deductin% t&e depreciation for e0ery year as per t&e sc&edule pro0ided by t&e Indian =otor /ariff. If t&e price of any electrical and P or electronic item installed in t&e 0e&icle is not included in t&e manufacturerJs listed sellin% price1 t&en t&e actual 0alue 3after depreciation4 of t&is item can be added to t&e sum insured o0er and abo0e t&e IDH. In case t&e 0e&icle is fitted wit& )N- P ":-1 t&e )N-P":- 7it fitted to t&e 0e&icle is to be insured separately at an additional premium.

-ENE5$" INSG5$N)E 6&at is -eneral InsuranceM

Insurance ot&er t&an Q"ife Insurance9 falls under t&e cate%ory of -eneral Insurance. -eneral Insurance comprises of insurance of property a%ainst fire1 bur%lary etc1 personal insurance suc& as $ccident and Healt& Insurance1 and liability insurance w&ic& co0ers le%al liabilities. /&ere are also ot&er co0ers suc& as Errors and Cmissions insurance for professionals1 credit insurance etc.

Non8life insurance companies &a0e products t&at co0er property a%ainst .ire and allied perils1 flood storm and inundation1 eart&@ua7e and so on. /&ere are products t&at co0er property a%ainst bur%lary1 t&eft etc. /&e non8life companies also offer policies co0erin% mac&inery a%ainst brea7down1t&ere are policies t&at co0er t&e &ull of s&ips and so on. $ =arine )ar%o policy co0ers %oods in transit includin% by sea1 air and road. .urt&er1 insurance of motor 0e&icles a%ainst dama%es and t&eft forms a ma+or c&un7 of non8life insurance business.

In respect of insurance of property1 it is important t&at t&e co0er is ta7en for t&e actual 0alue of t&e property to a0oid bein% imposed a penalty s&ould t&ere be a claim. 6&ere a property is under0alued for t&e purposes of insurance1 t&e insured will &a0e to bear a rateable proportion of t&e loss. .or instance if t&e 0alue of a property is 5s.1,, and it is insured for 5s. ,P81 in t&e e0ent of a loss to t&e e?tent of say 5s. ,P81 t&e ma?imum claim amount payable would be 5s.2 P8 3 ,; of t&e loss bein% borne by t&e insured for underinsurin% t&e property by ,; 4 . /&is concept is @uite often not understood by most insureds. :ersonal insurance co0ers include policies for $ccident1 Healt& etc. :roducts offerin% :ersonal $ccident co0er are benefit policies. Healt& insurance co0ers offered by non8life insurers are mainly &ospitaliAation co0ers eit&er on reimbursement or cas&less basis. /&e cas&less ser0ice is offered t&rou%& /&ird :arty $dministrators w&o &a0e arran%ements wit& 0arious ser0ice pro0iders1 i.e.1 &ospitals. /&e /&ird :arty $dministrators also

pro0ide ser0ice for reimbursement claims. Sometimes t&e insurers t&emsel0es process reimbursement claims. $ccident and &ealt& insurance policies are a0ailable for indi0iduals as well as %roups. $ %roup could be a %roup of employees of an or%aniAation or &olders of credit cards or deposit &olders in a ban7 etc. Normally w&en a %roup is co0ered1 insurers offer %roup discounts. "iability insurance co0ers suc& as =otor /&ird :arty "iability Insurance1 6or7men9s )ompensation :olicy etc offer co0er a%ainst le%al liabilities t&at may arise under t&e respecti0e statutes R =otor He&icles $ct1 /&e 6or7men9s )ompensation $ct etc. Some of t&e co0ers suc& as t&e fore%oin% 3=otor /&ird :arty and 6or7men9s )ompensation policy 4 are compulsory by statute. "iability Insurance not compulsory by statute is also %ainin% popularity t&ese days. =any industries insure a%ainst :ublic liability. /&ere are liability co0ers a0ailable for :roducts as well. /&ere are %eneral insurance products t&at are in t&e nature of pac7a%e policies offerin% a combination of t&e co0ers mentioned abo0e. .or instance1 t&ere are pac7a%e policies a0ailable for &ouse&olders1 s&op 7eepers and also for professionals suc& as doctors1 c&artered accountants etc. $part from offerin% standard co0ers1 insurers also offer customiAed or tailor8made ones. Suitable %eneral Insurance co0ers are necessary for e0ery family. It is important to protect one9s property1 w&ic& one mi%&t &a0e ac@uired from one9s &ard earned income. $ loss or dama%e to one9s property can lea0e one s&attered. "osses created by

catastrop&es suc& as t&e tsunami1 eart&@ua7es1 cyclones etc &a0e left many &omeless and penniless. Suc& losses can be de0astatin% but insurance could &elp miti%ate t&em. :roperty can be co0ered1 so also t&e people a%ainst :ersonal $ccident. $ Healt& Insurance policy can pro0ide financial relief to a person under%oin% medical treatment w&et&er due to a disease or an in+ury. Industries also need to protect t&emsel0es by obtainin% insurance co0ers to protect t&eir buildin%1 mac&inery1 stoc7s etc. /&ey need to co0er t&eir liabilities as well. .inanciers insist on insurance. So1 most industries or businesses t&at are financed by ban7s and ot&er institutions do obtain co0ers. 2ut are t&ey obtainin% t&e ri%&t co0ersM $nd are t&ey insurin% ade@uately are @uestions t&at need to be %i0en some t&ou%&t. $lso or%aniAations or industries t&at are self8financed s&ould ensure t&at t&ey are protected by insurance. =ost %eneral insurance co0ers are annual contracts. Howe0er1 t&ere are few products t&at are lon%8term. It is important for proposers to read and understand t&e terms and conditions of a policy before t&ey enter into an insurance contract. /&e proposal form needs to be filled in completely and correctlyby a proposer to ensure t&at t&e co0er is ade@uate and t&e ri%&t one.

)onclusion
/&ere is a probability of a spurt in employment opportunities. $ number of web8sites are comin% up on insurance1 a few financial ma%aAines e?clusi0ely de0oted to insurance and also a few trainin% institutes bein% set up &urriedly. =any of t&e uni0ersities and mana%ement institutes &a0e already started or

are contemplatin% new courses in insurance. "ife insurance &as today become a mainstay of any mar7et economy since it offers plenty of scope for %arnerin% lar%e sums of money for lon% periods of time. $ well8re%ulated life insurance industry w&ic& mo0es wit& t&e times by offerin% its customers tailor8 made products to satisfy t&eir financial needs is1 t&erefore1 essential if we desire to pro%ress towards a worry8free future. $wareness ':ro%ress Cf "ife insurance in India since 2,,, to 2,12