Presented

By:
Sudhanshu Kumar
Jha:92
Sulagna
Mukherjee:93
Sumit Sharma:94
Sushil Tommar:95
Tarit Chatterjee:96
Udit Grover:97
 Insurance is something that almost all of us will
need sometime, and it is worth understanding it
before buying it.

 Insurance is a form of risk-management which

spreads risk of many people in exchange for small
payments from each. Specifically, insurance
transfers some type of risk (accident, theft, natural
disaster, illness, etc) from one person or group to a
more financially-sound entity in exchange for a
payment (also known as a premium). Premiums are
often annual or monthly, but depending on the
type of insurance they can be at other intervals.
- In 1956, 245 Indian and Foreign life insurers and provident societies
were nationalized, and new single entity namely “LIC” was established
by passing the LIC Act, 1956.
- Similarly, in 1972, 107 general insurers were nationalized through the
passing of General Insurance Business (Nationalisation) Act, 1972.
- The existing 107 insurers were amalgamated and grouped into Five
companies, viz., National Insurance Company (NIC), New India
Assurance Company (NIAC), Oriental Insurance Company (OIC),
United India Insurance Company (UIIC), and General Insurance
Corporation (GIC).
- Then insurance industry transformed into monopoly and Oligopolistic
state or public sector insurance industry in India.
 INSURANCE INDUSTRY IN INDIA

Public Sector Private Sector

Life General
Life General
( 16 Companies) (09 Companies)

GIC and
its Four
subsidiaries

Post Office
LIC of India
Insurance

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-Several leading private sector companies have entered in the field
of insurance sector, both in life and non-life insurance.
-There are several MNCs, in Joint Venture with Indian private
sector firms, have started operations in a big way.
Private Players in the Life Insurance Business
Regd. Date of Name of the Who Owns it (in percentage)
No. Regd. Company
101 23.10.00 HDFC Standard Life Standard Life, UK - 18 and HDFC – 82
104 15.11.00 Max New York Life New York Life - 26 and Max India – 74
105 24.11.00 ICICI Prudential Life Prudential, UK - 26 and ICICI Bank – 74
107 10.01.01 Om Kotak Mahindra Old Maruthi, South Africa – 26 and Kotak
Mahindra – 74
109 31.01.01 Birla Sunlife Sun Life of Canada–26 and Birla Capital– 74

110 12.02.01 Tata AIG AIG, US – 26 and Tatas – 74

111 30.03.01 SBI Life Cardif SA, France – 26 and State Bank of
India – 74
114 02.08.01 ING Vysya ING, Holland–26 and GMR Group, Hyd–54
and ING Visya Bank–20 02/06/10 7
 CURRENT SCENARIO contd….
Private Players in the General Insurance Business
Regd. Date of Name of the Company Who Owns it (in percentage)
No. Regd.
113 02.05.01 Bajaj Allianz
115 03.08.01 ICICI Lombard
106 04.12.00 IFFCO-Tokio
103 23.10.02 Reliance
102 23.10.02 Royal Sundaram Alliance
108 22.01.01 Tata AIG
123 15.07.02 Cholamandalam
124 27.08.02 Export Credit Guarantee
125 27.08.02 HDFC Chubb

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 Life Insurance: Life insurance products include Term Life
policies, which give a pure risk coverage of only the death benefit,
whereas endowment or money back policies have a risk as well as
savings component i.e. death as well as maturity benefit.

 General Insurance: Non Life insurance products include

property or casualty, health insurance or house, fire, marine
insurance etc.
1. Security of funds, and
2. Maximization of return of investment,

Investment Policy in 1995 (GOI, Economic Survey, 1996-97)

1. Central Govt. marketable securities being not less than 20%
2. Loans to Housing Bank including above (1) being not less than 25%
3. State Govt. securities including Govt. Guaranteed marketable
securities, inclusive of (2) above being not less than 50%
4. Socially oriented sectors including public sector, co-operative sector
house building by policyholders, own house scheme, inclusive of (3)
above not less than 75%
5. Private corporate sector, loans to policyholders for construction and
acquisition of immovable property 25%

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Aid To Thrift (economy):
Liquidity:
Tax Relief:
Money When you need it:

02/06/10 11
 Prier nationalization there were 68 Indian insurers (including
LIC) and 45 non-Indian insurers did the business.
 In Nov. 1972, the general insurance business was nationalized by
the General Insurance Business (Nationalized), Act 1972
(GIBNA) and vested in the hand of the GIC and its four
subsidiaries viz.
1. National Insurance Co. Ltd.,
2. New India Assurance Co. Ltd.,
3. Oriental Fire and General Insurance Co. Ltd., and
4. United India Insurance Co. Ltd.
 GIC was incorporated as a holding company in 1992.
 General Insurance Business is completely owned by the
government.
 The paid up capital of GIC was fully subscribed by the
Government and of four subsidiaries.
 It was controlled by a single organization with four subsidiaries.

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1. Central Govt. securities being not less than 20%
2. State Govt. securities and other government guaranteed
securities, including (1) above, being not less than 30%
3. Loans to HUDCO/DDA/GIC-HF and to state govts. For
housing and fire fighting equipment, not less than 15%
4. Market sector not more than 55%

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S.No Life Insurance General Insurance
1 Death benefit Motor Insurance
2 Property Insurance
3 Liability Insurance
4 Credit Insurance
5 Travel Insurance
6 Health Insurance
7 Disability Insurance
 Motor Car Insurance: No longer a Luxury
But a Necessity.
 Eg: Insurance may be necessity for richer

person, or it’s may be luxury for poor

person.
(Mukesh Ambani vs. Rikshawala)
 People need insurance because the
unexpected does happen. Whether it is
a fire, a car wreck, illness or a death, the
financial consequences can be
devastating if you are uninsured.
Insurance helps people have peace of
mind when life's unexpected events
happen.

 Your need for life insurance changes

with the stages of your life, starting with
no need when you're young, progressing
to greater and greater levels as you take
on more and more responsibility and
finally beginning to diminish as you grow
older, which is when you should
commence planning for your retirement.
 When you are single
 Double Income no kids
 Married with children
 The golden years.
Insurance: Necessity or luxury, Need or
investment, It’s time to decide because as
we have seen in this discussion that
Insurance is need but it may sometime
Investment, as it is in the case of Necessity
or luxury, Insurance is necessity but those
who have no money, it will be luxury.
 www.insuremagic.com
 www.ehow.com
 www.articlesbase.com
 www.images.google.co.in
 Prof. Abhijit Roy
 Prof. Abhishek Mittal