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INSURANCE
(LIFE INSURANCE CORPORATION)
SUBMITTED BY
EMMANUEL SAVIO, TY.BBI
ROLL NO. 8246
I,
year
2011-2012.
The
information
Stamp of College
Signature of student
Signature of
Signature of Coordinator
External Examiner
CERTIFICATE
I, RENU TIWARI here by certify that the following
student of St. Andrews College of T.Y.B.Com (Banking
& Insurance) Semester (VI) has completed his
research report on INSURANCE (LIC) for the
academic year 2011-2012. Information submitted is
true & original to the best of my knowledge.
Stamp of college
of Professor
Signature
(Prof. RENU
ACKNOWLEDGEMENT
for
their
assistance,
encouragement
and
INDEX
SR.NO
CONTENTS
PAGE
NO.
EXECUTIVE SUMMERY
INTRODUCTION
PRODUCT OF LIC
OBJECTIVES OF LIC
24
25
28
FINDINGS
30
10
CONCLUSION
33
11
RECOMMENDATIONS
34
12
BIBLIOGRAPHY
35
EXECUTIVE SUMMARY
Someone has greatly said that practical knowledge is far better than
classroom teaching. During this project I fully realized this and come to
know about the present real world of Insurance sector. It includes all the
activities involved in providing insurance products to the final customers.
I am pleased to know about the consumers wants and competitors activities
in the real world of Insurance. The subject of my study is to analyze the
present insurance sector and products offered by LIC by applying various
tools like cold calling and through direct interaction with customers. I have
also done research on the growth of private life insurance companies in the
last five years. The report contains first of all brief introduction about the
company.
Then it contains the current status of private insurance companies and
foreign insurance companies in India.
I also put forward recommendations of the consumers and conclusions
that will help LIC to provide consumer satisfactory services in the insurance
sector.
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 1
RESEARCH OBJECTIVE
1. The report gives the brief background of the sector and proceeds to
highlight the short comings of the existing setup and players.
2. The benefits of liberalized sector are enumerated.
3. The report also tries to identify the market potential for insurance products
and the strategy that can be employed to exploit the same.
4. The stress is also given on knowing the awareness level of general public.
RESEARCH METHODOLOGY:
To conduct the market research first of all it is necessary to create a research
design.
A research design is basically a blue print of how a research is to be
conducted, it may include;
1. Choosing the approach
2. Determining the types of data needed.
3. Locating the source of data.
4. Choosing a method of data.
RESEARCH DESIGN:
Basically there are 3 types of approaches used during any research:
1. Exploratory
2. Descriptive
3. Experimental.
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 2
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 3
INTRODUCTION
Insurance is a social device where uncertain risks of individuals may be
combined in a group and thus made more certain - small periodic
contributions by the individuals provide a found out of which those who
suffer losses may be reimbursed.
In addition to being a means to protect oneself, the insurance Industry is an
efficient conduit for the saving of people to be channeled towards economic
growth. In India, the Insurance Industry7 is more than150 years old. Today,
it is monopolized by two PSUs in their respective fields of life and General
Insurance.
However, with the successful passage IRDA Bill through both houses of
parliament in December 1999 the sector has been opened up to private
players. This will provided much. Needed impetus to the Industry and will
improve the quality of service and products and will also increase
employment opportunities.
There are still some issues their need to be sorted out, particularly with
regard to the status of intermediaries as envisaged by the Insurance
Regulatory Authority.
An insurance company works out how likely it is that an
accident or event will happen and what it would cost to put it
right. Based on this, the insurance company sets what is
know as a premium.
This is the amount it asks you to pay in order to protect
yourself against the accident or event. The cost of the
premium is often spread so you pay it on a monthly basis. If
whatever it is you have insured yourself against happens,
you then make a claim to your insurance company and it
pays out the agreed amount.
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 4
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 5
General Insurance:
General insurance business in the country was nationalized with effect from
1stJanuary, 1973 by the General Insurance Business (Nationalization) Act,
1972. More than 100 non-life insurance companies including branches of
foreign companies operating within viz., the National Insurance Company
Ltd., The New India Assurance Company Ltd., The Oriental Insurance
Company Ltd., and The United India Insurance Company Ltd. with head
offices at Calcutta, Bombay, New Delhi and Madras, respectively. General
Insurance Corporation (GIC) which was the holding company of the four
public sector general insurance companies has since been de linked from the
later and has been approved as the "Indian Re insurer" since 3rd
November 2000. The share capital of GIC and that of the four companies
are held by the Government of India. All the five entities are Government
companies registered under the Companies Act, 1956. The general insurance
business has grown in spread and volume after nationalization. The four
companies have 2699 branch offices, 1360divisional offices and 92 regional
offices spread all over the country. GIC and its subsidiaries have
representation either directly through branches or agencies in 16countries
and through associate locally incorporated subsidiary companies in 14
other countries. A wholly- owned subsidiary company of GIC, i.e. Indian
International Pvt. Ltd. is operating in Singapore and there is a joint venture
company, viz. Ken-India Assurance Ltd. in Kenya. A new wholly owned
subsidiary called New India International Ltd., UK has also been registered.
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 6
PRODUCTS OF LIC
Whole Life with Profits Plan 002
Features:
This plan is mainly devised to create an estate for the heirs of the
policyholder as the plan basically provides for payment of sum assured plus
bonuses on the death of the policyholder. However, considering the
increased longevity of the Indian population, the Corporation has amended
the above provision, thereby proving for payment of sum assured plus
bonuses in the form of maturity claim on completion of age 80 years or on
expiry of term of 40 years from date of commencement of the policy
whichever is later. The premiums under the policy are payable up to age 80
years of the policyholder or for a term of 35 years whichever is later. If the
payment of premium ceases after 3years, a paid-up policy for such reduced
sum assured will be automatically secured provided the reduced sum assured
exclusive of any attached bonus is not less thanRs.250/-. Such reduced paidup policy is not entitled to participate in the bonus declared thereafter but the
bonuses already declared on the policy will remain attach, provided the
policy is converted in to a paid-up policy after the premiums are paid for 5
years.
Suitable For:
This policy is suitable for people of all ages who wish to protect their
families from financial crises that may occur owing to the policyholder's
premature death.
BENEFITS
SURVIVAL BENEFIT:
Sum assured plus accrued bonuses and the terminal bonuses, if any; on
the policyholder attaining age 80 years or on expiry of term of 40 years from
the date of commencement of the policy whichever is later.
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 7
DEATH BENEFIT:
Sum assured plus accrued bonuses and the terminal bonuses, if any, on the
death of the policyholder are paid to his/her nominees/heirs.
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 8
Accident Benefit:
By paying a small extra premium of Rs. l per Rs. 1000/- sum assured per
year he or his family are entitled to the following benefits on death or
permanent disability caused by accident. Even students above the age of 18
years can avail of this benefit.
Premium Stoppage:
If payment of premiums ceases after at least THREE years' premiums have
been paid , a free paid-up policy for a reduced sum assured will be
automatically secured provided the reduced sum assured, exclusive of any
attached bonus, is not less than Rs. 250/.
The reduced sum assured will become payable on the event as stipulated in
the policy.
Bonus:
Is there anything extra payable besides the sum assured at the time of claim
settlement? Yes, but only if it is a 'with profits' policy. Every year the Life
Insurance Corporation distributes its surplus among policyholder to 'with
profits' polices in the form of bonuses. Substantial bonuses have been
declared in the past after each valuation of policy liabilities.
ANMOL JEEVAN - I (WITHOUT PROFITS) BENEFITS
On Death during the Term of the Policy: Sum Assured On Maturity: Nil
RESTRICTIONS
(A) Minimum age at entry: 18 years (completed)
(B) Maximum age at entry: 55 years (nearer birthday)
(C)Maximum age at maturity: 65 years
(D) Minimum Term: 5 years
(E) Maximum Term: 25 years
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 9
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If the Policy has lapsed, it may be revived during the life time of the Life
Assured, but before the date of expiry of policy term, on submission of proof
of continued insurability to the satisfaction of the Corporation and the
payment of all the arrears of premium together with interest at such rate as
may be prevailing at the time of the payment. The corporation reserves the
right to accept or decline the revival of discontinued policy. The revival of
the discontinued policy shall take effect only after the same is approved by
the Corporation and is specifically communicated to the Life Assured. The
cost of the Medical reports, including Special Reports, if any, required for
the purposes of revival of the policy, should be borne by the Life Assured.
PAYMENT OF CLAIMS:
No Claims concession will be applicable to this Policy.
BACK-DATING INTEREST:
The policy can be back dated within the financial year. No dating back
interest shall be charged.
BENEFITS:
Survival benefits:
If one or both the lives survive to the maturity date, the sum assured, along
with the accumulated bonus, is payable.
Death Benefits:
In case either of the couple dies during the policy's term, two things happen.
One, LIC pays to the surviving spouse the full sum assured. And, two, the
policy continues on the life of the surviving partner without him/her having
to pay any further premiums ,i.e. the life cover on the survivor continues free
of cost. The sum assured is again be payable on the death of the other
partner in case both the husband and wife were to die during the term of the
policy. Vested bonus would also be paid along with the sum assured on the
second death.
Page 11
Main Exclusions:
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 12
Age Limitations:
This policy covers people between the age of 3 months to 65 years.
Floater Basis:
The benefit of family' will operate on floater basis i.e. the total
reimbursement of Rs.30,000/- can be availed of individually or collectively
by members of the family.
Unit plans:
Unit plans are investment plans for those who realize the worth of hardearned money. These plans help you see your savings yield rich benefits and
help you save tax even if you dont have consistent income.
Jeevan plus
Future plus
Bima plus
Market plus
Money plus
Profit plus
Fortune plus
Fortune plus:
Emmanuel Savio
St. Andrews College T.Y.B.B.I
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You can switch between any fund types for the entire Fund Value
during the policy term subject to switching charges, if any.
iii) Discontinuance of premiums:
If premiums are payable either yearly, half-yearly, quarterly or monthly
(ECS) and the same have not been duly paid within the days of grace under
the Policy, the Policy will lapse. A lapsed policy can be revived during the
period of two years from the due date of first unpaid premium.
i Where at least 3 years premiums have been paid, the Life Cover and
Accident Benefit rider, if any, shall continue during the revival period.
During this period, the charges for Mortality and Accident Benefit cover, if
any, shall be taken, in addition to other charges, by canceling an appropriate
number of units out of the Policyholders Fund Value every month. This will
continue to provide relevant risk covers for i.e. two years from the due date
of first unpaid premium, or
ii. Till the date of maturity, or
iii. Till such period that the Policyholders Fund Value reduces to Rs.
5,000/-, whichever is earlier. The benefits payable under the policy in
different contingencies during this period shall be as under:
A. In case of Death: Higher of Sum assured under the Basic Plan or the
Policyholders Fund Value. The Sum Assured shall be subject to provisions
of Partial Withdrawals made, if any.
B. In case of Death due to accident: Accident Benefit Sum Assured in
addition to the amount under A above, if Accident Benefit is opted for.
C. On Maturity: The Policyholders Fund Value.
D. In case of Surrender (including Compulsory Surrender): The
Policyholders Fund Value. The Surrender value, however, shall be paid only
after the completion of 3 policy years.
E. In case of Partial Withdrawals: For 2 years period from the date of
withdrawal, the sum assured under the basic plan shall be reduced to the
extent of the amount of partial withdrawals made.
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 15
II) Where the policy lapses without payment of at least 3 years premiums,
the Life Cover and Accident Benefit rider cover, if any, shall cease and no
charges for these benefits shall be deducted. However, deduction of all the
other charges shall continue. The benefits under such a lapsed policy shall be
payable as under
F. In case of Death: The Policyholders Fund Value.
G. In case of death due to accident: Only, the amount as under F above.
H. In case of Surrender (including Compulsory Surrender): Policyholders
Fund Value / monetary value as the case may be, shall be payable after the
completion of the third policy anniversary. No amount shall be payable
within 3 years from the date of commencement of policy.
I. In case of Partial withdrawal: Partial Withdrawals shall not be allowed
under such a policy even after completion of 3 years period.
III) Revival: If due premium is not paid within the days of grace, the policy
lapses. A lapsed policy can be revived during the period of two years from
the due date of first unpaid premium or before maturity, whichever is earlier.
The period during which the policy can be revived will be called Period of
revival or revival period .If premiums have not been paid for at least 3
full years, the policy may be revived within two years from the due date of
first unpaid premium.
The revival shall be made on submission of proof of continued insurability
to the satisfaction of the Corporation and the payment of all the arrears of
premium without interest. If at least 3 full years premiums have been paid
and subsequent premiums are not paid, the policy may be revived within two
years from the due date of first unpaid premium but before the date of
maturity. No proof of continued insurability shall be required but all arrears
of premium without interest shall be required to be paid.
The Corporation reserves the right to accept the revival at its own terms or
decline the revival of a lapsed policy. The revival of a lapsed policy shall
take effect only after the same is approved by the Corporation and is
specifically communicated in writing to the Propose / Life Assured
.Irrespective of what is stated above, if less than 3 years premiums have
been paid and the Policyholders Fund Value is not sufficient to recover the
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 16
charges, the policy shall be terminated and thereafter revival will not be
entertained.
If 3 years or more than 3years premiums have been paid and the
Policyholders Fund Value reduces to Rs.5000/-, the policy shall terminate
and Policyholders Fund Value as on such date shall be refunded to the Life
Assured and thereafter revival will not be allowed.
IV) Settlement Option: When the policy comes for maturity, you may
exercise Settlement Option and may receive the policy money in
installments spread over a period of not more than five years from the date
of maturity. There shall not be any life cover during this period. The value of
installment payable on the date specified shall be subject to investment risk
i.e. the NAV may go up or down depending upon the performance of the
fund.
Reinstatement:
A policy once surrendered will not be reinstated.
Risks borne by the Policyholder:
i) LICs Fortune Plus is a Unit Linked Life Insurance product which is
different from the traditional insurance products and is subject to the risk
factors.
ii) The premium paid in Unit Linked Life Insurance policies are subject to
investment risks associated with capital markets and the NAVs of the units
may go up or down based on the performance of fund and factors
influencing the capital market and the insured is responsible for his/her
decisions.
iii) Life Insurance Corporation of India is only the name of the Insurance
Company and LICs Fortune Plus is only the name of the unit linked life
insurance contract and does not in any way indicate the quality of the
contract, its future prospects or returns.
iv) Please know the associated risks and the applicable charges, from your
Insurance agent or the Intermediary or policy document of the insurer.
v) The various funds offered under this contract are the names of the funds
and do not in any way indicate the quality of these plans, their future
prospects and returns.
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 17
vi) All benefits under the policy are also subject to the Tax Laws and other
financial enactments as they exist from time to time.
Cooling off period:
If you are not satisfied with the Terms and Conditions of the policy, you
may return the policy to us within 15 days.
Loan: No loan will be available under this plan.
Assignment: Assignment will be allowed under this plan.
Exclusions: Any amount exceeding it. From second year onwards each
years premium will be 25% of the first year premium. In case the Life
Assured commits suicide at any time within one year, the Corporation will
not entertain any claim by virtue of the policy except to the extent of the
Policyholders Fund Value on death.
MARKET PLUS
IN THIS POLICY, THE INVESTMENT RISK IN INVESTMENT
PORTFOLIO IS BORNE BY THE POLICYHOLDER"
LICs MARKET PLUS:
This is a unit linked deferred pension plan. You can take the plan with or
without risk cover. You can also choose the level of cover within the limits,
which will depend on whether the policy is a Single premium or Regular
premium contract and on the level of premium you agree to pay. The
allocated premiums will be applied to purchase units as per the Fund type
chosen. Your Unit Account will be subject to deduction of charges as
specified in the Policy Conditions. The value of the units in the Unit Fund
may increase or decrease, depending on the investment return of the assets
representing the chosen Fund i.e.
Payment of Premiums:
You may pay premiums regularly at yearly, half-yearly or quarterly intervals
over the term of the policy. The minimum annual premium will be Rs.5,
000/- increasing thereafter in multiples of Rs.1, 000/-.Alternatively, a Single
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 18
B) Benefit on Vesting:
On your surviving to the date of vesting, the Fund Value of the units held in
your Unit Account will compulsorily be utilized to provide a pension based
on the then prevailing immediate annuity rates under the relevant annuity
option. However, you may opt to commute up to one-third of the Benefit to
be paid asa lump sum. Further, you may choose to purchase pension from
LIC or other life insurance company.
Accident Benefit Option:
If you have opted for life cover, you may opt for Accident Benefit equal to
life cover subject to minimum Rs. 25,000 and maximum Rs. 50 lakh (taken
all policies with LIC of India and other insurers).In case of death by
Accident, an additional sum equal to Accident benefit will be payable.
Eligibility Conditions And Other Restrictions:
Basic Plan
Minimum Age at entry: 18 years completed
Maximum Age at entry: 70 years (age nearer birthday).
However if life cover is opted for, then 65 years
Minimum Age at vesting: 40 years (age last birthday)
Maximum Vesting Age: 75 years (age last birthday)
Minimum Deferment Term: 5 years
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 19
Minimum Sum Assured: Rs. 25,000 for Single premium Rs. 50,000 for
Regular premium
Maximum Sum Assured: Single Premium - Equal to single premium
Regular Premium - 20 times of the annualized premium.
i) Investment of Funds:
The premiums allocated to purchase units will be strictly invested according
to the investment pattern committed in various fund types. Various types
of fund and their investment pattern will be as under:
Fund Type Short-term investments such as money market instruments
(including Govt. Securities & Corporate Debt) Investment in Listed
Equity Shares:
Bond Fund
Not less than 80%100%Nil
Secured Fund
Not less than 65% not more than 85% not less than15% & not more than
35%.
Balanced Fund
Not less than 50% not more than 70% not less than30% & not more than
50%.
Growth Fund
i. Not less than 20% not more than 40% not less than60% & not more than
80%.
ii.The Policyholder has the option to choose any ONE of the above 4
funds. Incase no fund has been opted for, the allocated premiums shall, by
default, be invested in the SECURED FUND.
iii. Method of Calculation of Unit price:
Units will be allotted based on the Net Asset Value (NAV) of the respective
fund as on the date of allotment. There is no Bid-Offer spread (the Bid price
and Offer price of units will both be equal to the NAV). The NAV will be
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 20
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for Bond Fund 1.00% p.a. of Unit Fund for ?Secured? Fund 1.25%p.a. of
Unit Fund for Balanced Fund 1.50% p.a. of Unit Fund for Growth Fund.
Switching Charge:
This is the charge levied on switching of monies from one fund to another.
Within a given policy year 4 switches will be allowed free of charge.
Subsequent switches in that year shall be subject to a switching charge of
Rs. 100 per switch.
Bid/Offer Spread:
Nil
Surrender Charge:
Nil
Service Tax Charge:
A service tax charge shall be levied on the Mortality and Accident Benefit
rider charge, if any, on a monthly basis. The level of this charge will be as
per the rate of service tax as applicable from time to time. Presently, the rate
of Service Tax is 12% with an educational cess at the rate of 2% thereon and
hence effective rate is 12.24%.
Miscellaneous Charge:
This is a charge levied for an alteration within the contract, such as reduction
in policy term, change in premium mode, etc. An alteration may be allowed
subject to a charge of Rs. 50/-.
(D) Right to revise charges:
The Corporation reserves the right to revise all or any of the above charges
except the premium allocation charge and charges for risk covers, with the
prior approval of IRDA.
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St. Andrews College T.Y.B.B.I
Page 22
Salient Features
Sum assured is payable only on the death of the life assured
Premiums have to be paid for 35 years or till age 80 years whichever is more
Premiums cease on death of the life assured
Benefits
On Death
Sum assured + vested bonuses are payable to nominees/beneficiaries on
death of life assured only.
Other Conditions
Minimum sum assured: Rs 20000
Minimum premium must be Rs.800 per annum
Minimum age at entry: 18 years
Maximum age at entry: 60 years
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St. Andrews College T.Y.B.B.I
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Objectives of LIC
Spread Life Insurance widely and in particular to the rural areas and to the
socially and economically backward classes with a view to reaching all
insurable persons in the country and providing them adequate financial
cover against death at a reasonable cost.
Maximize mobilization of people's savings by making insurance-linked
savings adequately attractive.
Bear in mind, in the investment of funds, the primary obligation to
its policyholders, whose money it holds in trust, without losing sight of the
interest of the community as a whole; the funds to be deployed to the best
advantage of the investors as well as the community as a whole, keeping in
view national priorities and obligations of attractive return.
Conduct business with utmost economy and with the full realization that the
moneys belong to the policyholders.
Act as trustees of the insured public in their individual and collective
capacities.
Meet the various life insurance needs of the community that would arise in
the changing social and economic environment.
Involve all people working inthe corporation to the' best of their
capability in furthering the interests of the insured public by providing
efficient service with courtesy.
Promote amongst all agents and employees of the Corporation a sense
of participation, pride and job satisfaction through discharge of their duties
with dedication towards achievement of Corporate Objective.
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St. Andrews College T.Y.B.B.I
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constantly developing an insurance product in order to meet the everchanging requirements of the customer. Quality customer service and
education can be another area where a company can differentiate itself from
other companies.
IT to boost life market growth?
THE LIFE Insurance Corporation of India (LIC) has turned to information
technology in a bid to shed its image as a dinosaur among more nimble
private sector companies. LIC, India's dominant life insurer, is encouraging
policyholders to use its web site to pay premiums and make claims. Lastmonth, it announced new mobile phone SMS(testing) services to alert
policyholders of news about their plans. These moves, unmatched by most
of LIC's smaller private sector rivals, are part of an effort to open new
channels to increase the speed and quality of customer service -long seen as
LIC's weakness after decades as India's monopoly life insurer.
LIC's performance in the year to March 2004 suggests that these efforts are
working. It sold27 million new policies generating Rs.85.7 billion (US$1.9
billion) in premium income - an annual growth of about 11 percent. LIC's
deployment of information technology may have helped it maintain its 88
percent market share of premium sales. Yet few believe that technology
alone will drive the company's - and in effect, the Indian life industry's
expansion. "Ultimately the growth of life insurance depends on growth of
the economy," said TK. Banerjee, a board member of the Insurance
Regulatory Development Authority. India's economic growth rate in March
2004 hit double-digit figures to become Asia's fastest-growing economy.
Most economists forecast growth to stabilize at around 7 percent to 2005.
Banerjee said that this climate of rising economic prosperity is encouraging
consumers to think more about insurance.
Nonetheless, most life companies believe consumers still need Sanmar:
"People still don't think that insurance is important. Most sales happen after
personal interaction. "AMP Sanmar, a two-year old joint venture between
south.-Indian based conglomerate Sanmar and Australia's AMP, has
employed some 3,000 sales agents are targeting small and medium-sized
towns that have low penetration rates of life insurance. India's life insurance
penetration is less than three percent. "We're focused on places where there
is no other company - not even LIC," Subramaniam said,-remarking that
unlike LIC, AMP Sanmar regards the internet and mobile phones as channels
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 26
for promotion, not sales. He said that the internet is not widespread as a
channel to sell consumer products in India, but Subramaniam has not ruled
out deploying such technology in the future. Whatever the merits of new
distribution channels, the industry fears a decline in sales following new
taxes levied on single premium products. Single premium life insurance has
been popular in India mainly because guaranteed returns were tax-free.
This encouraged policyholders to pay large premiums with minimal risk
cover, for payments at maturity that often exceeded the returns of more
sophisticated financial products such as mutual funds. But last October, the
government decided to tax premiums that paid above 20 percent of the sum
assured. The decision has reduced sales of single premium products, which
is likely to restrain the overall growth of India's life industry. The industry
regulator has forecast growth of life premiums to be around 20 percent to
March -2004, about the same level as 1999, down from a burst of sales in
2002 of 43.5 percent. India's life insurers have rallied to persuade the
government to rescind the ruling later this year, but any decision must wait
for the end of parliamentary elections currently underway.
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 27
Emmanuel Savio
St. Andrews College T.Y.B.B.I
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Mr. Vaidya, Chairman of SBI, has recently stated that all it is looking for is a
good and reliable partner and the question of a hefty premium to be charged
to its foreign partner is not significant. Them monolith has finally come to
business senses foreign companies are unhappy even about laws pertaining
to repatriation of funds. The Stipulated investment criteria is also something
that all players in the sector, be it Indian or foreign, are closing watching.
The foreign players are essentially looking to tap their" global expertise in
the variety markets and use that know-how to work in the Indian scenario.
Designing of products, information systems, technical expertise, manpower
planning etc is what one expects the foreign players to have a say in. Any
venture of the joint kinds needs to be between equals. If this is not there then
there is every chance that a partner in the venture will feel increasingly un
comfortable and would be looking to call the joint venture off.
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St. Andrews College T.Y.B.B.I
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FINDINGS
QUESTIONNAIRE ANALYSIS
Respondents =80
Respondents Responded =60
Response Rate =75%
Respondents are taken from private, government and business sectors.
1. According to you who has played a major role in the field of life
insurance companies?
INSURANCE
LIC
HDFC
ICICI
OTHERS
PVT.
EMLOYEES
10
5
3
2
GOVT.
EMPLOYEES
13
3
3
1
BUSINESS
MAN
10
5
4
1
PVT.
EMLOYEES
12
3
4
1
Emmanuel Savio
St. Andrews College T.Y.B.B.I
GOVT.
EMPLOYEES
14
2
3
1
BUSINESS
MAN
12
4
3
1
Page 30
PVT.
EMLOYEES
12
3
3
2
GOVT.
EMPLOYEES
14
2
2
BUSINESS
MAN
10
5
4
1
13
7
GOVT.
SECTOR
16
4
BUSINESS
MAN
12
8
12
8
Emmanuel Savio
St. Andrews College T.Y.B.B.I
GOVT.
SECTOR
16
4
BUSINESS
MAN
11
9
Page 31
7. What according to you, the term plan that only covers risk
and doesnt cover maturity benefit on survival at the end of the term
provides security cover over policy holders or a smart way of
accumulative money from policy holders?
PVT. SECTOR
YES
NO
11
9
GOVT.
SECTOR
15
5
BUSINESS
MAN
12
8
16
4
GOVT.
SECTOR
18
2
BUSINESS
MAN
16
4
18
2
Emmanuel Savio
St. Andrews College T.Y.B.B.I
GOVT.
SECTOR
20
-
BUSINESS
MAN
19
1
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CONCLUSION
After overhauling the all situation that boosted a number of Pvt. Companies
associated with multinational in the Insurance Sector to give befitting
competition to the established behemoth LIC in public sector, we come at
the conclusion that :
1) There is very tough competition among the private insurance companies
on the level of new trend of advertising to lull a major part of Customers.
2) LIC is not left behind in the present race of advertisement.
3) The entry of the Pvt. Players in the Insurance Sector has expanded
the product segment to meet the different level of the requirement of the
customers. It has brought about greater choice to the customers.
4) Private insurers have restricted reach to the customers.
5) LIC has vast market and very firm grip on its traditional customers and
monopoly of life insurance products.
6) Bank assurance - that allows life insurers to leverage on the risk product
through bank network, was adopted by private players. But LIC was also not
left behind as picking up majority stake in the corporation Bank and large
equity stake in the Oriental Bank of Commerce.
IRDA is also playing very comprehensive role by regulating norms
mandating to private players in this sector, that increases the confidence
level of the customers to the private players
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 33
RECOMMENDATIONS
In the modernized well advanced hi-tech approach to the customer every
possible facilities and effort to build up the confidence of the rising policy
holders towards. Insurance companies, to complete one another nothing is
left to recommend. But some recommendations that are intensely felt and
highly required for insures to sustain in the market.
These are as follows:
a) More and more transparency should be ascertained between insurers
and policy holders.
b) Particularly, in the emerging boom in the insurance company, every
insurance company should be customer centered, and well versed in the
handling of problem and grievances of the policy holders.
c) Each and Every product launched by the Insurance Company should be in
favor of increasing need of policy holders.
IRDA should be more and more responsible to the insurance sector by
determining some standard. It should be mandatory to every insurers to
make more and more responsible and responsive to the policy holders so that
comprehensive understanding may be developed among policy holders. It
may be beneficial on both sides
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 34
BIBLIOGRAPHY
BROCHURES / INFORMATION BOOKLETS
Product List L.I.C.
L.I.C. Annual Report
HDFC Annual Report
Malhotra Committee Report on Reforms in the Insurance Sector, 1993.
The Insurance Regulatory and Development Authority Bill, 1999.
NEWSPAPERS / MAGAZINES
The Economic Times
DNA money
Insurance Post
BOOKS
Dr. Gupta S.P& Dr. Gupta M.P., Business Statistics by Addition 2004, New
Delhi.
WEBSITES
w.w.w.liclndia.com
www.lrdaindia.org.com
www.indiainfoline.com
www.icici.com
www.hdfc.com
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 35
Emmanuel Savio
St. Andrews College T.Y.B.B.I
Page 36