INSURANCE For securing you from risks By : Lekshmi Narayanan K
INTRODUCTION Definition: Insurance is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. Insurance, whether life or non-life, provides people with a reasonable degree of security and assurance that they will be protected in an event of a calamity or failure of any sort.
HOW IT WORKS ? Economies of Scale, i.e. the insurer collects premium from a large group of people individually through a policy and invests them in many forms which brings high returns. Once an insured person claims, the benefit is provided for the deceased. Underwriting and investing The business model is to collect more in premium and investment income than is paid out in losses Profit = Earned premium + Investment income - Incurred loss - Underwriting expenses. Insurers make money in two ways: Through underwriting, the process by which insurers select the risks to insure and decide how much in premiums to charge for accepting those risks. By investing the premiums they collect from insured parties.
EVOLUTION Insurance in modern form originated in the Mediterranean during the 13th century. Marine insurance is the oldest form of insurance followed by life insurance and fire insurance. The history of life insurance in India dates back to 1818 when it was conceived as a means to provide for English Widows.
INDIAN EVOLUTION Oriental life Insurance Company was the first insurer and was incorporated at Calcutta in 1818 Insurance regulation formally began in India through the passing of two acts - Life Insurance companies Act of 1912 - Provident Fund Act of 1912 By 1938 there were 176 insurance companies. Nationalization of insurance business took place in 1956
CURRENT SCENARIO In 1993, Malhotra Committee was formed and several Insurance Reforms were made. Redesigned the Structure Increased Competition Regulatory body (IRDA) Investments Customer Service
KEY TERMS Agent - Individual who sells and services insurance policies. Annuity - An agreement by an insurer to make periodic payments. Coverage - The scope of protection provided under an insurance policy. Claim - A request for payment for a loss under the terms of an insurance policy Policy - The written contract effecting insurance, or the certificate. Premium - The price of insurance protection for a specified risk for a specified period of time.
IMPORTANCE Protection for dependants Savings for Old Age Encourage Savings Initiates Investments Credit worthiness Social Security Tax Benefits
Public Sector :National Insurance Co LtdNew India Assurance Co LtdOriental Insurance Co LtdUnited India Insurance Co Ltd LIST OF INSURANCE COMPANIES IN INDIAPrivate SectorBajaj Allianz Bharti AXA Cholamandalam Future GeneraliGeneral Insurance General Insurance MS India InsuranceICICI Lombard Universal Sompo Royal Sundaram SBI General General Insurance InsuranceShriram General Reliance General Tata AIG General HDFC ERGOInsurance InsuranceMagma HDI L & T General Liberty Videocon IFFCO TokioGeneral Insurance Insurance General Insurance
MARKET STATISTICSLife Insurance Funds accounts to 15% of household Savings &may grow upto 20% in future.Insurance Penetration in India is 2.6% of GDP compared toKorea(6.77%) & Singapore(6.38%).India is ranked 19th position in Insurance with a growth of 19%p.a.Non Life Insurance have lower penetration and rural peopleneeds awareness.620 tn rupees investment is anticipated for infrastructuredevelopment in future.
STRATEGIC POLICIES Identification of Markets Assessment of Risks Penetration and exploitation of markets control over investment and operating costs Finding best prospects Newer Marketing Strategies
SWOT ANALYSISStrengths Weakness•Strong capital and reserve •High administration & management expenses•Technically Skilled Manpower •Vertical organisational structure•Innovative product for differentdemography •Lower Reliability on Pvt. PlayersOpportunities Threats•Inflow of global managerial & financial •Cut-throat competitionexpertise •New Entrants•Liberalization results to wider choices •customers switching to other company•Introduce global innovations andpractises
CONCLUSION Today most of the insurance companies are recruiting agents who are professionals who can sell their unsought insurance products. Companies also provide better policies based on customer needs and demands. In this Competitive market companies provide better service Quality, Pricing, Advertisement and Promotional activities. CRM is used to retain the customers and communicate with them. By another 20 yrs 50% of population is expected to have at least one sort of an insurance.
Aviva Life Insurance Company India ING Vysya Life Insurance Company Ltd. Met Life India Insurance Company Ltd.Limited ING Term Life Plus MET Suraksha - TROPLife Shield ING Term Life MET Suraksha Met -MortgageMet-Mortgage ProtectorAEGON Religare Life Insurance ICICI Prudential Life Insurance Co. LtdCompany Limited. Life Guard Return of Premium Reliance Life Insurance CompanyDecreasing Term Plan Life Guard Regular Premium Limited.Increasing Term Plan Home Assure Loan cover term insurance Reliance Simple Term PlanLevel Term Plan Life Guard Single Premium Reliance Special Credit Guardian Plan Reliance Special Term PlanBirla Sun Life Insurance Co. Ltd IDBI Fortis Life Insurance Company Ltd. Reliance Credit Guardian PlanBirla Sun Life Insurance Premium Back Home AssuranceTerm Plan Sahara India Life Insurance Co, Ltd.Birla Sun Life Insurance Term Plan Kotak Mahindra Old Mutual Life Insurance Sahara KavachBirla Sub Life Insurance HNWI Term Plan Limited Kotak Premium Return Plan Shriram Life Insurance Co. Ltd.Bharti AXA Life Insurance Company Ltd. Kotak Term / Preferred Term Plan Shri SurakshaSecure Confident Life Insurance Corporation of India SBI Life Insurance Co. LtdBajaj Allianz Life Insurance Company The Convertible Term Assurance Policy SBI SwadhanLimited Mortgage Redemption SBI ShieldProtector New Bima GoldNew Risk Care Two Year Temporary Assurance Policy Tata AIG Life Insurance CompanyTerm Care Anmol Jeevan-I Limited Amulya Jeevan-I Tata AIG Life LifePlusFuture Generali India Life Insurance Tata AIG Life Raksha 10/15/20/25Company Limit Max New York Life Insurance Co. Ltd Tata AIG Life AssureFuture Care Five Yr Renewable and Convertible Plan (Non - Par) Level Term Plan HDFC Standard Life Insurance Co. Ltd Loan Cover Term Assurance Plan Term Assurance Plan Home Loan Protection Plan