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  1. 1. ACOMPANY TRAININIG REPORTON ANALYTICAL STUDY OF SAVING ANSCHEMECOMPLETED IN "LIC OF INDIA"SUBMITTED IN THE PARTIAL FRLFILLMENT OF REQUIREMENT FOR THEDEGREE OFBACHELOR OF BUSINESS ADMINISTRATION (BBA),GURUJAMBHESHWARUNIVERSITY OF SCINCE & TECHNOLOGY,HISAR(HARYANA)B.B.A.(2007-2010)SUPERVISED BY: - SUBMITTEDD BY:-MR. SURJEET BISHNOIMs. DEEPENDRAHOD OF MANAGEMENT SINGH PARMAR SCMIT,SIKAR(RAJ.) BBA FINAL YEAR E/NO-: 07511505007SUBMITTED TO:-DIRECTORATEOF DISTANCE EDUCATIONGURU JAMBHESHWAR UNIVERSITY OF SCIENCE& TECHNOLOGYHISAR(HARYANA)1250012DIRECTORATE OF DISTANCE EDUCATIONGURU JAMBHESWAR UNIVERSITY OFSCIENCE & TECHNOLOGY, HISAR (HARYANA)125001RESUME OF SUPERVISORNAME MR. SURJEET BISHNOIDESIGNATION LECTURER, HODQUALIFICATIONB.Sc, MBA & UGC-NETAREA OF SPECIALIZATION MARKETINGEXPERIENCE 6YEARSOFFICIAL ADDRESS SCMIT,SIKAR CONTRACT NO. +919414581356E-MAILsurjeet_bishnoi@yahoo.comDATE (SIGNATURE)3DECLARATIONI do hereby declare that this piece of project report entitled³An AnalyticalStudy of Saving Scheme at LIC´practices in³LIFE INSURANCECORPORATION OF INDIA´for partial fulfillment of the requirements fromthe award of the degree of³BBA´is a record of original work done by meunder the supervision & guidance ofMs. Surjeet Bishnoi , ShekhawatiCollege of Information & Technology,Sikar(Raj.).This project work is aconfide work done by me & has neither submitted nor publishedelsewhere.Place: SignatureDate:4ACKNOWLEDGEMENTAt The OutsetSummer training is one of the most vital and active part of the curriculum ofmanagement students. Its basic idea behind this is to strengthen thestudent¶sconcept through practical training and make them acquainted withactual method andprocedures.I did the work as a management trainee at LIC for a period for01-01-2010to14-02-2010.I would like to extend my heartfelt gratitude toMr. RamhetPrasad Chief Life Insurance Advisor at LIC, Dholpur
  2. 2. for his proper guidance throughout the project. Without her support and cooperationIwould have failed in my endeavors and targets in the summer training.I am greatlyintended to my guidesMr. Surjeet Bishnoi (HOD OFMANAGEMENT),Shekhawati College Of Management and InformationTechnology,Sikar(Raj.)for their constant guidance, advice & help whichenabled me to finish this projectreport.DEEPENDRA PARMAR (SIGNATURE)5PREFACESomeone has rightly said that practical experience is far better and closer to the realworld then mere theoretical exposure. The practical experiencehelps the student toview the real business world closely,which in turnwidely influences his perceptionsand understanding of the real situation.Research work constitutes the backbone ofany management educationprogram. A management student has to do researchwork quite frequentlyduring his entire span.The research work entitled "AnAnalytical study of Saving Scheme atLIC" Completed in "LIFE INSURANCE CORPORATION OF INDIA" aimsto know customer awareness regardingLIC.The present report is a part of the project that contains the work done byme duringthe training period ofLIC OF INDIA, Dholpur(Raj.).True to the core, a properly and executed industrial training helps a lotinunderstanding of the mode of operation of industrial organization.The project has offered me an opportunity to put all my efforts andthetheoretical knowledge to practice and enhance my knowledge,and at the suretime given me practical experience in the field of marketing. It is surly going tohelp me in future projects too.In the preparation of this report, I have made every effort to ensure that allstepscompleted in it. Any suggestions for improvement, will be gratefullyaccepted.Isincerely hope that this will prove pure knowledge imparting, throughprovoking andthus stimulating future research work on these guideline.6EXECUTIVE SUMMEARYIn today¶s corporate and competitive world, I find that insurance sector hasthemaximum growth and potential as compared to the other sectors. Insurance hasthemaximum growth rate of 70-80% while as FMCG sector has maximum 12-15% ofgrowth rate. This growth potential attracts me to enter in this sector and LIFEINSURANCE CORPORATION (LIC). has given me the opportunity to work andgetexperience in highly competitive and enhancing sector. Agents are the only wayfor a company of Insurance sector through which policies andbenefits of thecompany can be explained to the customer.The life insurance industry in India grewby an impressive 47.38%, with premiumincome at Rs. 1560.41 billion during thefiscal year 2006-2007. Though the total volumeof LICs business increased in the last
  3. 3. fiscal year (2006-2007) compared to the previousone, its market share came downfrom 85.75% to 81.91%.The 17 private insurers increased their market share fromabout 15% to about 19% in ayears time. The figures for the first two months of thefiscal year 2007-08 also speak of the growing share of the private insurers. Theshare of LIC for this period has further come down to 75 percent, while the privateplayers have grabbed over 24 percent.With the opening up of the insurance industryin India many foreign players haveentered the market. The restriction on thesecompanies is that they are not allowed tohave more than a 26% stake in acompany¶s ownership.Since the opening up of the insurance sector in 1999, foreign investments of Rs.8.7billion have poured into the Indian market and 19 private life insurance companieshavebeen granted licenses.Innovative products, smart marketing, and aggressivedistribution have enabledfledgling private insurance companies to sign up Indiancustomers faster than anyoneexpected. Indians, who had always seen life insuranceas a tax saving device, are nowsuddenly turning to the private sector and snappingup the new innovative products onoffer.Some of these products include investment plans with insurance and good returns(unitlinked plans), multi ± purpose insurance plans, pension plans, child plans andmoneyback plans.7CONTENTSACKNOWLEDGEMENTEXECUTIVE SUMMARYINTRODUCTION OF INDUSTRYINTRODUCTON OF ORGANIZATIONMILESTONES OF LIFE INSURANCE BUSINESS IN INDIAGENERAL INSURANCE CORPORATION OF INDIAMILESTONES IN GENERAL INSURANCEBORAD OF DIRECTORS OF LICKNOW ABOUT OUR LIFE INSURANCEOPERATE ALL OVER INDIAADMISSION OF AGEMISSION & VISION OF LICOBJECTIVE OF LIC
  4. 4. AWARDS OF LICSAVING SCHEME OF LICPROCUCTED OFFERED TO CUSTOMER BY LICJEEVAN AKSHAY PLANBENEFITS OF PLANJEEVAN SARAL POLICYSMALL SAVINGPAY ROLL SAVING SCHEMEBANK AND FINANCIAL INSTITUTIONSRESEARCH METHODOLOGYDATA ANALYSIS & INTERPRETATIONCONCLUSIONSWOT ANALYSISAPPENDIXESQUESTIONNAIREREFRENCES & BIBLIOGARPHY8INTRODUCTION OF INDUSTRYThe history of life insurance in India dates back to 1818 when it was conceived asameans to provide for English Widows. Interestingly in those days a higher premiumwascharged for Indian lives than the non - Indian lives, as Indian lives wereconsideredmore risky to cover. The Bombay Mutual Life InsuranceSociety started its business in1870. It was the first company to charge the samepremium for both Indian and non-Indian lives.The Oriental Assurance Company wasestablished in 1880. The General insurancebusiness in India, on the other hand, cantrace its roots to Triton Insurance CompanyLimited, the first general insurancecompany established in the year 1850 in Calcutta bythe British. Till the end of thenineteenth century insurance business was almost entirelyin the hands of overseascompanies.Insurance regulation formally began in India with the passing of the LifeInsuranceCompanies Act of 1912 and the Provident Fund Act of 1912.S
  5. 5. everal frauds during the1920s and 1930s sullied insurance business in India. By1938 there were 176insurance companies.The first comprehensive legislation wasintroduced with the Insurance Act of 1938 thatprovided strictState Control over the insurance business. The insurance business grewat a fasterpace after independence. Indian companies strengthened their hold on thisbusinessbut despite the growth that was witnessed, insurance remained anurbanphenomenon.The Government of India in 1956, brought together over 240private life insurers andprovident societies under one nationalized monopolycorporation and Life InsuranceCorporation (LIC) was born. Nationalization wasjustified on the grounds that it wouldcreate the much needed funds for rapidindustrialization. This was in conformity with theGovernments chosen path ofState led planning and development.The non-life insurance business continued tothrive with the private sector till 1972.Their operations were restricted to organizedtrade and industry in large cities. Thegeneral insurance industry was nationalized in1972. With this, nearly 107 insurers wereamalgamated and grouped into fourcompanies- National Insurance Company, NewIndia Assurance Company, OrientalInsurance Company andUnited India InsuranceCompany.9These were subsidiaries of the General Insurance Company (GIC).With the largestnumber of life insurance policies in force in the world, Insurancehappens to be amega opportunity in India. It¶s a business growing at the rate of 15-20per centannually and presently is of the order of Rs 1560.41 billion (for the financialyear 2006± 2007). Together with banking services, it adds about 7% to the country¶sGrossDomestic Product (GDP). The gross premium collection is nearly 2% of GDPandfunds available with LIC for investments are 8% of the GDP.Even so nearly 65%of the Indian population is without life insurance cover while healthinsurance andnon-life insurance continues to be below international standards. A largepart of ourpopulation is also subject to weak social security and pension systems withhardlyany old age income security. A well-developed and evolved insurance sector isneeded for economic development asit provides long term funds for infrastructuredevelopment and strengthens the risktaking ability of individuals. It is estimated thatover the next ten years India wouldrequire investments of the order of one trillionUSdollars.10INTRODUCTION OF ORGANIZATIONLife Insurance Corporation of India (LIC)Life Insurance Corporation of India (LIC) was established on 1September 1956 tospread the message of life insurance in the country and mobilisepeople¶s savings for nation-building activities. LIC with its central office in Mumbaiand seven zonal offices atMumbai, Calcutta, Delhi, Chennai, Hyderabad, Kanpurand Bhopal, operates through100 divisional offices in important cities and 2,048branch offices. LIC has 5.59 lakhactive agents spread over the country.TheCorporation also transacts business abroad and has offices in Fiji, Mauritius andU
  6. 6. nited Kingdom. LIC is associated with joint ventures abroad in the field ofinsurance,namely, Ken-India Assurance Company Limited, Nairobi;United Oriental AssuranceCompany Limited, Kuala Lumpur; and Life InsuranceCorporation (International), E.C.Bahrain. It has also entered into an agreement withtheSun Life (UK) for marketing unitlinked life insurance and pension policies inU.K.In 1995-96, LIC had a total income from premium and investments of $ 5 BillionwhileGIC recorded a net premium of $ 1.3 Billion. During the last 15 years, LICsincomegrew at a healthy average of 10 per cent as against the industrys 6.7 percent growth inthe rest of Asia (3.4 per cent in Europe, 1.4 per cent in theUS).LIC has even provided insurance cover to five million people living below thepovertyline, with 50 per cent subsidy in the premium rates. LICs claims settlementratio at 95per cent and GICs at 74 per cent are higher than that of global average of40 per cent.Compounded annual growth rate for Life insurance business has been19.22 per centper annumThe story of insurance is probably as old as the story ofmankind. The same instinct thatprompts modern businessmen today to securethemselves against loss and disaster existed in primitive men also. They too soughtto avert the evil consequences of fire andflood and loss of life and were willing tomake some sort of sacrifice in order to achievesecurity. Though the concept ofinsurance is largely a development of the recent past,particularly after the industrialera ± past few centuries ± yet its beginnings date backalmost 6000 years.11Life Insurance in its modern form came to India from England in the year 1818.OrientalLife Insurance Company started by Europeans in Calcutta was the first lifeinsurancecompany on IndianSoil. All the insurance companies established during that periodwere brought up withthe purpose of looking after the needs of European communityand Indian nativeswere not being insured by these companies. However, later with theefforts ofeminent people like Babu MuttylalSeal, the foreign life insurance companiesstarted insuring Indian lives. But Indian liveswere being treated as sub-standard livesand heavy extra premiums were beingcharged on them. Bombay Mutual Life AssuranceSociety heralded the birth of first Indian life insurance company in the year 1870, andcovered Indian lives at normal rates.Starting as Indian enterprise with highlypatriotic motives, insurance companies cameinto existence to carry the message of insurance and social security throughinsurance to various sectors of society. BharatInsurance Company (1896) was alsoone of such companies inspired by nationalism.TheSwadeshi movement of 1905-1907 gave rise to more insurance companies. The
  7. 7. United India in Madras, National Indian and National Insurance in Calcutta and the Co-operative Assurance at Lahore were established in 1906. In 1907, Hindustan Co-operative Insurance Company took its birth in one of the rooms of the Jorasanko,houseof the great poet Rabindranath Tagore, in Calcutta. The Indian Mercantile,General Assurance andSwadeshi Life (later Bombay Life) were some of the companiesestablished during thesame period. Prior to 1912 India had no legislation to regulateinsurance business. Inthe year 1912, the Life Insurance Companies Act, and theProvident Fund Act werepassed. The Life Insurance Companies Act, 1912 made itnecessary that thepremium rate tables and periodical valuations of companies shouldbe certified by anactuary. But the Act discriminated between foreign and Indiancompanies on manyaccounts, putting the Indian companies at a disadvantage.The first two decades ofthe twentieth century saw lot of growth in insurance business.From 44 companieswith total business-in-force as Rs.22.44 crore, it rose to 176companies with totalbusiness-in-force as Rs.298 crore in 1938. During themushrooming of insurancecompanies many financially unsound concerns were alsofloated which failedmiserably. The Insurance Act 1938 was the first legislationgoverning not only lifeinsurance but also non-life insurance to provide strict statecontrol over insurancebusiness. The demand for nationalization of life insuranceindustry was maderepeatedly in the past but it gathered momentum in 1944 when a billto amend theLife Insurance Act 1938 was introduced in the Legislative Assembly.However, it wasmuch later on the 19th of January, 1956, that life insurance in India wasnationalized.About 154 Indian insurance companies, 16 non-Indian companies and 75providentwere operating in India at the time of nationalization. Nationalizationwasaccomplished in two stages; initially the management of the companies wastaken over by means of an Ordinance, and later, the ownership too by means of acomprehensivebill. The Parliament of India passed the Life Insurance CorporationAct on the 19th of June 1956, and the Life Insurance Corporation of India wascreated on 1stSeptember,1956, with the objective of spreading life insurance much more widely andin particular to the rural areas with a view to reach all insurable persons in thecountry, providingthem adequate financial cover at a reasonable cost.12LIC had 5 zonal offices, 33 divisional offices and 212 branch offices, apart fromitscorporate office in the year 1956.Since life insurance contracts are long term contractsand during the currency of thepolicy it requires a variety of services need was felt in thelater years to expand theoperations and place a branch office at each districtheadquarter. Re-organization ofLIC took place and large numbers of new branchoffices were opened. As a result ofre-organisation servicing functions were transferredto the branches, and brancheswere made accounting units. It worked wonders with theperformance of thecorporation. It may be seen that from about 200.00 crores of NewBusiness in 1957the corporation crossed 1000.00 crores only in the year 1969-70, andit took another10 years for LIC to cross 2000.00 crore mark of new business. But withre-organisation happening in the early eighties, by 1985-86 LIC had alreadycrossed7000.00 crore
  8. 8. Sum Assured on new policies.Today LIC functions with 2048 fully computerizedbranch offices, 109 divisional offices,8 zonal offices, 992 satallite offices and theCorporate office. LIC¶s Wide Area Networkcovers 109 divisional offices andconnects all the branches through a Metro AreaNetwork. LIC has tied up with someBanks andService providers to offer on-linepremium collection facility in selected cities. LIC¶s ECSand ATM premium paymentfacility is an addition to customer convenience. Apartfrom on-line Kiosks and IVRS, InfoCentres have been commissioned at Mumbai, Ahmedabad, Bangalore,Chennai,Hyderabad, Kolkata, New Delhi, Pune and many other cities. With a visionof providingeasy access to its policyholders, LIC has launched itsSATELLITESAMPARK offices.The satellite offices are smaller, leaner and closer to the customer.The digitalizedrecords of the satellite offices will facilitate anywhere servicing andmany other conveniences in the future.LIC continues to be the dominant life insurereven in the liberalized scenario of Indianinsurance and is moving fast on a newgrowth trajectory surpassing its own pastrecords. LIC has issued over one crorepolicies during the current year. It has crossedthe milestone of issuing 1,01,32,955new policies by 15th Oct, 2005, posting a healthygrowth rate of 16.67% over thecorresponding period of the previous year.From then to now, LIC has crossed manymilestones and has set unprecedentedperformance records in various aspects of lifeinsurance business. The same motiveswhich inspired our forefathers to bringinsurance into existence in this country inspire usat LIC to take this message ofprotection to light the lamps of security in as many homesas possible and to help thepeople in providing security to their families.13MILESTONES OF LIFE INSURANCE BUSINESS IN INDIA1818: Oriental Life Insurance Company, the first life insurance company onIndiansoil started functioning.1870: Bombay Mutual Life AssuranceSociety, the first Indian life insurancecompany started its business.1912: The IndianLife Assurance Companies Act enacted as the firststatute to regulate the lifeinsurance business.1928: The Indian Insurance Companies Act enacted to enablethegovernment to collect statistical information about both life and non-lifeinsurancebusinesses.1938: Earlier legislation consolidated and amended to by the InsuranceActwith the objective of protecting the interests of the insuring public.1956: 245Indian and foreign insurers and provident societies are takenover by the centralgovernment and nationalised. LIC formed by an Act of Parliament, viz. LIC Act,1956, with a capital contribution of Rs. 5 crorefrom the Government of India.TheGeneral insurance business in India, on the other hand, can trace itsroots to theTriton Insurance Company Ltd., the first general insurancecompany established inthe year 1850 in Calcutta by the British.14GENERAL INSURANCE CORPORATION OF INDIA (GICI)
  9. 9. The general insurance industry in India was nationalized and a governmentcompanyknown as General Insurance Corporation of India (GIC) wasformed by the CentralGovernment in November 1972. With effect from 1January 1973 the erstwhile 107Indian and foreign insurers which wereoperating in the country prior tonationalization, were grouped into four operating companies, namely, (i) NationalInsurance Company Limited; (ii)New India Assurance Company Limited; (iii) OrientalInsurance CompanyLimited; and (iv)United India Insurance Company Limited. (However, witheffect from Dec2000, thesesubsidiaries have been de-linked from theparent company and made as independentinsurance companies). All theabove four subsidiaries of GIC operate all over thecountry competing withone another and underwriting various classes of generalinsurancebusiness except for aviation insurance of national airlines andcropinsurance which is handled by the GIC.Besides the domestic market, theindustry is presently operating in 17countries directly through branches or agenciesand in 14 countries throughsubsidiary and associate companies.15MILESTONES IN GENERAL INSURANCE1907: The Indian Mercantile Insurance Ltd. set up, the first company totransact allclasses of general insurance business.1957: General Insurance Council, a wing ofthe Insurance Association of India, frames a code of conduct for ensuring fairconduct and soundbusiness practices.1968: The Insurance Act amended to regulateinvestments and setminimum solvency margins and the Tariff Advisory Committeeset up.1972: The General Insurance Business (Nationalisation) Act,1972nationalised thegeneral insurance business in India with effect from 1st January1973.107 insurers amalgamated and grouped into four companies viz.theNationalInsurance Company Ltd., the New India Assurance Company Ltd.,theOriental Insurance Company Ltd. and theUnited India Insurance CompanyLtd. GIC incorporated as a company.16BOARD OF DIRECTORS OF LICMembers On The Board Of The CorporationShri. T.S. Vijayan(Chairman)Shri. D.K. Mehrotra(Managing Director - LIC)Shri. Thomas Mathew T.(Managing Director - LIC)Shri. A.K. Dasgupta(Managing Director - LIC)Shri. Ashok Chawla(FinanceSecretary, Ministry of Finance, Govt. of India)Shri. R. Gopalan(Secretary, Department of FinancialS
  10. 10. ervices, Ministry of Finance, Govt. of India.)Shri. Yogesh Lohiya(Chairman cum Managing Director, GIC of India)Shri. S.Sridhar,Chairmain & Managing Director , Central Bank of IndiaDr. Sooranad RajashekhranShri. Monis R. KidwaiLt. General Arvind Mahajan( Retd.)Shri. Anup Prakash Garg17KNOW ABOUT OUR LIFE INSURANCELife insurance in India made its debut well over 100 years ago.In our country, whichis one of the most populated in the world, the prominence of insurance is not aswidely understood, as it ought to be. What follows is an attempt toacquaint readerswith some of the concepts of life insurance, with special reference toLIC.It should,however, be clearly understood that the following content is by no meansanexhaustive description of the terms and conditions of an LIC policy or its benefitsor privileges.For more details, please contact our branch or divisional office. Any LICAgent will beglad to help you choose the life insurance plan to meet your needs andrender policyservicing.What Is Life Insurance?Life insurance is a contract that pledges payment of an amount to the personassured(or his nominee) on the happening of the event insured against.The contractis valid for payment of the insured amount during:The date of maturity, orSpecified dates at periodic intervals, orUnfortunate death, if it occurs earlier. Among other things, the contract also providesfor the payment of premiumperiodically to the Corporation by the policyholder. Lifeinsurance is universallyacknowledged to be an institution, which eliminates risk,substituting certainty for uncertainty and comes to the timely aid of the family in theunfortunate event of deathof the breadwinner.By and large, life insurance iscivilisations partial solution to the problems caused bydeath. Life insurance, in short,is concerned with two hazards that stand across thelife-path of every person:That ofdying prematurely leaving a dependent family to fend for itself.That of living till oldage without visible means of support.18Life Insurance Vs. Other SavingsContrace Of Insurance:A contract of insurance is a contract of utmost good faith technically knownasuberrima fides. The doctrine of disclosing all material facts is embodied inthisimportant principle, which applies to all forms of insurance. At the time of taking apolicy, policyholder should ensure that all questions in theproposal form are correctlyanswered. Any misrepresentation, non-disclosure or fraudin any document leading tothe acceptance of the risk would render the insurancecontract null and void.Protection:Savings through life insurance guarantee full protection against risk of death ofthesaver. Also, in case of demise, life insurance assures payment of the entire
  11. 11. amountassured (with bonuses wherever applicable) whereas in other savingsschemes, onlythe amount saved (with interest) is payable.Aid To Thrift:Life insurance encourages thrift. It allows long-term savings since payments canbemade effortlessly because of the easy instalment facility built into thescheme.(Premium payment for insurance is either monthly, quarterly, half yearly oryearly).For example: TheSalarySavingScheme popularly known asSSS, provides aconvenient method of paying premium each month by deduction fromones salary.In this case the employer directly pays the deducted premium to LIC.TheSalarySavingScheme is ideal for any institution or establishment subject to specified termsandconditions.Liquidity:In case of insurance, it is easy to acquire loans on the sole security of any policythathas acquired loan value. Besides, a life insurance policy is also generallyacceptedas security, even for a commercial loan.Tax Relief:Life Insurance is the best way to enjoy tax deductions on income tax and wealthtax.This is available for amounts paid by way of premium for life insurance subjecttoincome tax rates in force. Assesses can also avail of provisions in the law for taxrelief. In such cases theassured in effect pays a lower premium for insurance thanotherwise.19Money When You Need It:A policy that has a suitable insurance plan or a combination of different plans canbeeffectively used to meet certain monetary needs that may arise from time-to-time.Childrens education, start-in-life or marriage provision or even periodical needsfor cash over a stretch of time can be less stressful with the help of these policies.Alternatively, policy money can be made available at the time of ones retirementfromservice and used for any specific purpose, such as, purchase of a house or forother investments. Also, loans are granted to policyholders for house building or forpurchase of flats (subject to certain conditions). Any person who has attainedmajority and is eligible to enter into a valid contract caninsure himself/herself andthose in whom he/she has insurable interest.Policies can also be taken, subject tocertain conditions, on the life of ones spouse or children. While underwritingproposals, certain factors such as the policyholder¶s stateof health, the proponentsincome and other relevant factors are considered by theCorporation.Insurance For Women
  12. 12. Prior to nationalisation (1956), many private insurance companies would offerinsurance to female lives with some extra premium or on restrictiveconditions.However, after nationalisation of life insurance, the terms under which lifeinsurance isgranted to female lives have been reviewed from time-to-time. Atpresent, women who work and earn an income are treated at par with men. In othercases, a restrictive clause is imposed, only if the age of the female is up to 30yearsand if she does not have an income attracting Income Tax.Medical And Non-Medical Schemes:Life insurance is normally offered after a medical examination of the life to beassured.However, to facilitate greater spread of insurance and also to avoidinconvenience,LIC has been extending insurance cover without any medicalexamination, subject tocertain conditions.With Profit And Without Profit Plans:An insurance policy can be with or without profit. In the former, bonuses disclosed,if any, after periodical valuations are allotted to the policy and are payable along withthecontracted amount.In without profit plan the contracted amount is paid withoutany addition. The premiumrate charged for a with profit policy is therefore higherthan for a without profit policy.Keyman InsuranceKeyman insurance is taken by a business firm on the life of key employee(s) toprotectthe firm against financial losses, which may occur due to the prematuredemise of theKeyman.20OPERATE ALL OVER INDIA21ADMISSION OF AGEAdmission Of Age:Age is the main basis of calculation of premium under life insurance policies.Thefollowing are accepted as evidence of age:Certified extract from Municipal orLocal Body¶s records made at the time of birth.Certificate of Baptism or CertifiedExtract Family Bible, if it contains age or date of birth.Certified Extract fromSchool or College records, if age or date of birth is stated therein.Certified Extract fromService Register in the case of Govt. employees and employeesof Quasi-Govt.Institutions or Passport issued by the Passport Authorities in India.Payment Of Premium:By cash, local cheque (subject to realization of cheque), Demand Draft at BranchOffice.The DD and cheques or Money Order may be sent by post. You can pay yourpremiumsat any of our Branches as 99% of our Branches are networked. ManyBanks do acceptstanding instructions to remit the premiums.So by providing a standing instruction toyour Bank to debit your account for thepremium amount and send it vide a banker¶scheque to LIC, on the due dates andmonths mentioned on your policy bond.Through Internet : Payment of premiums canbe made through Internet throughServiceProviders viz.HDFC Bank, ICICI Bank, Times of Money, Bill Junction,U
  13. 13. TI Bank, Bank of Punjab, Citibank, Corporation Bank, Federal Bank and BillDesk.Premium payment can also be made through ATMs of Corporation Bank andUTI Bank.Premium payment can also be made through Electronic ClearingService (ECS) whichhas been launched at Mumbai, Hyderabad, Chennai, Kolkata, New Delhi,Kanpur,Bangalore, Vijayawada, Patna, Jaipur, Chandigarh, Trivandrum,Ahmadabad, Pune,Goa and Nagpur,Secunderabad & Visakhapatnam. A policyholder having an account inany Bank whichis a Member of the local Clearing House can opt for ECSdebit to paypremiums. The policyholders wishing to use this system would have to fillup a MandateForm available at our Branches/DO and get it certified by the Bank.The certifiedMandate Forms are to be submitted to our BO/DO.Policy can beanywhere in India.Citibank Kiosks at Industrial Assurance Building, Churchgate, NewIndia Building,Santacruz, JeevanShikha Building, Borivili are dedicated for collection of premiumsthrough cheques.Days Of Grace:Policyholder should pay the premiums on due dates. However, a grace period ofonemonth but not less than 30 days will be allowed for payment of yearly/half-yearly/quarterly premiums and 15 days for monthly premiums.When the days ofgrace expire on aSunday or a public holiday, the premium may bepaid on the following working day tokeep the policy in force.If the premium is not paid before the expiry of the days ofgrace, the policy lapses.22Revival Of Lapsed Policy:If the policy has lapsed, it can be revived during the life time of the life assured,within aperiod of five years from the date of the first unpaid premium but before thedate of maturity subject to certain conditions.The Corporation offers three convenientschemes of revival viz., Ordinary Revival,Special Revival and Installment Revival. Policies can also be revived under Loan-cum-Revival andSB-cum-Revival schemes.Request for revival may be made to the Branch Officeservicing the policy.Change Of Address And Transfer Of Policy Records:The policyholder should immediately intimate the change of his/her address totheBranch Office servicing the policy. The correct address facilitates better serviceandquicker settlement of claims. Policy records can also be transferred from oneBranchOffice to another for servicing, as requested by the policyholder.Loss Of Policy Document:
  14. 14. The Policy Document is an evidence of the contract between the Insurer andtheInsured. Hence the policyholder should preserve the Policy Bond till thecontractedamount under it is settled.Loss of the Policy Document should beimmediately intimated to the Branch Officewhere it is serviced.Loans:Loans are granted on policies to the extent of 90% ofSurrender Value of the policieswhich are in force and 85% of theSurrender Value in case of policies which are paid-up, inclusive of the cash value ofbonus. The rate of interest charged at present is 9%p.a. payable half-yearly.Loansare not granted for a period shorter than six months. The Conditions andPrivilegesprinted on the back of the Policy Bond states whether a particular policy iswith orwithout the loan facility.Relief To Policyholders:The Corporation generally allows concessions on payment of premiums, settlementof claims, issue of duplicate policies, etc when the policyholder are affected bynaturalcalamities such as droughts, cyclones, floods, earthquakes, etc.Nomination:Nomination is a right conferred on the holder of a Policy of Life Assurance on hisownlife to appoint a person/s to receive policy moneys in the event of the policybecoming aclaim by the assured¶s death. The Nominee does not get any otherbenefit except toreceive the policy moneys on the death of the Life Assured. Anomination may bechanged or cancelled by the life assured whenever he likeswithout the consent of theNominee.Ensure nomination exists in the policy for easysettlement of claims.23Assignment:Assignment means transfer of rights, title and interest. When an assignmentisexecuted, all rights, title and interest in respect of the property assigned areimmediatelytransferred to the Assignee/s and the Assignee/s become the owner/s ofthe policysubject to any lawful condition made in the assignment. Assignment can beeither conditional or absolute. On assignment (other than to LIC),Nominationautomatically stands cancelled. Hence, when such a policy is reassigned,thepolicyholder will have to make a fresh nomination to avoid delay in settlement ofclaim.Survival Benefit/Maturity Claims:LIC settles survival benefit/maturity claims on or before the due date.Policyholder areintimated well in advance by the Branch Office which services thepolicy regardingthe payment, and the necessary Discharge Voucher is also sent for execution by theassured. In case the policyholder does not get any intimation from theBranch Officeconcerned, he/she should contact them, quoting the Policy Number.Survival Benefit payment up to Rs.60,000/- are settled without insisting for PolicyBondand Discharge Voucher.Death Claims:If the life assured dies during the term of the policy, death claim arises. The death ofthepolicyholder should be immediately intimated in writing to the Branch Officewhere thepolicy is serviced along with the following particulars:The No./s of thepolicy/iesThe name of the policyholder Death Certificate issued by concerned
  15. 15. AuthorityThe date of death.1. The cause of death and2. Claimant¶s relationship withthe deceasedyOn receipt of the intimation of death, necessary claim forms are sent by theBranchOffice for completion along with instructions regarding the procedure tobe followedby the claimant.yThe claims which have arisen after a period of three years are treated as non-earlyclaims and settled within 30 days from the date of receipt of allrequirements.yThe claims that have arisen within a period of two years from the date ofcommencement of the policy, are treated as early claims and investigationiscompulsory in such cases.24Initiatives In Policy Servicing Areas:All 2048 Branches of LIC are fully computerized covering all policy servicing aspectstogive prompt computerized services from new policy introduction, acceptance ofrenewalpremium, revivals, loans, etc to final claims settlement.Green Channel facilityhas been introduced for the speedy completion of proposals.Payment of premiumscan be made through internet through serviceproviders, viz., HDFC Bank, ICICIBank, Times of money, Bill Junction,UTI Bank, Bankof Punjab,Citi Bank, Corporation Bank, Federal Bank and Billdesk.Grievance Redressal Machinery:A machinery for redressal of policyholders grievances exist in all the offices oftheCorporation. These are headed by designated Officers who are available at theirrespective Offices every Monday between 2.30 pm and 4.30 pm. exceptholidays.Policyholder can approach these officers to get their grievancesredressed.The Designated Officers at the various offices of the Corporation are : AtBranch Office ---Sr./Branch Manager At Divisional Office --- Marketing Manager At Zonal Office ---Regional Manager (Mktg) At Central Office --- Executive Director (Mktg/IO/CRM)Citizens¶ Charter:yCitizens Charter was presented to the Nation in November, 1997. In the Charter thebench marks were prescribed for 30 servicing areas.25MISSSION & VISION OF LICMission:"Explore and enhance the quality of life of people through financial securitybyproviding products and services of aspired attributes with competitivereturns, and byrendering resources for economic development."Vision:"A trans-nationally competitive financial conglomerate of significance tosocieties andPride of India."26OBJECTIVE OF LIC
  16. 16. ySpread Life Insurance widely and in particular to the rural areas and to thesocially andeconomically backward classes with a view to reaching all insurablepersons in thecountry and providing them adequate financial cover againstdeath at a reasonablecost.yMaximize mobilization of peoples savings by making insurance-linkedsavingsadequately attractive.yBear in mind, in the investment of funds, the primary obligation to itspolicyholders,whose money it holds in trust, without losing sight of the interest of the community asa whole; the funds to be deployed to the best advantage of theinvestors as well asthe community as a whole, keeping in view national prioritiesand obligations ofattractive return.yConduct business with utmost economy and with the full realization that themoneysbelong to the policyholders.yAct as trustees of the insured public in their individual and collective capacities.yMeet the various life insurance needs of the community that would arise inthechanging social and economic environment.yInvolve all people working in the Corporation to the best of their capabilityinfurthering the interests of the insured public by providing efficient servicewithcourtesy.yPromote amongst all agents and employees of the Corporation a sense ofparticipation, pride and job satisfaction through discharge of their dutieswithdedication towards achievement of Corporate Objective.27Shri.P.ChidambaramUnion Finance Minister³In the year 1956, 245 Indian and foreign companies were nationalized and today,thethree letters µLIC¶, stands as a synonym for insurance, for services, forexcellence instrengthening the economic fibre of this country. I dare to say that noother three letterstaken together are more recognised to the length and breadth ofIndia than LIC.´³The performance figures of LIC give an indication why LIC is dear tous, why LIC is aJewel in our crown and why we will continue to nurture LIC and growit into a greatorganization rendering service to the people of India.´³LIC¶s footprintsare now to be found in many other countries in the world. Wherever Indians go - andthey go everywhere now, wherever Indians are welcome - and they arewelcome inevery part of the world, wherever Indians settle down ± they have foundmany newhomes, wherever Indians excel ± and they excel in every walk of life, theywant LIC ±they want LIC to protect them, to look after their savings, and provide for protectionas well as their retirement.´P. Chidambaram
  17. 17. Union Finance Minister Excerpts from speeches at the inaugural function of LIC¶sGolden Jubilee Celebrations.Lucknow,September 1, 2005.28Dr.ManmohanSinghPrime Minister of India29AWARDS OF LICCNBC Awaaz Consumer awards 2010Reader Digest Trusted Brand Insurancecategory 2010OUTLOOK MONEY NDTV PROFIT AWARD2009 in " BEST LIFE INSURER CATEGORY "World Brand Congress AwardGolden Peacock Innovative Product /Service Award - 2009ASIA PACIFIC HRM Congress, 2009 Awardfor INNOVATIVE HR PRACTICES30Loyalty Award - 2009NDTV Profit Business Leadership Award2008INDYsSilver Award for Best CorporateFilmNASCOM ITUSER Award 2008BusinessSuperbrand India 2009 ASIA BRAND CONGRESSBRANDLEADERSHIP AWARD, 200831Meaning of saving scheme:saving schemes are a kind of mutual funds like diversified equity funds withTaxbenefits. It is just like other tax saving instruments like NationalSavings Certificate andPublic Provident Fund. Main advantage with EL
  18. 18. SSis lock-in period is only 3 years whilefor NSC it is 6 years and for PPF it is 15 years. At the same time risk factor is high inELSS. As per Income Tax act 80c investment up to Rs 1,00,000 are eligible for deductionfromthe gross total income hence reducing the total taxable income. For example ifyour total annual income is Rs 3,00,000 and you invest Rs 1,00,000 in ELSSthen your taxable income will become Rs 2,00,000.Previously there was an upperlimit for investing in tax saving instruments like ELSSof 5,00,000. Only individuals with less than 5,00,000 annual income are allowed toinvestin tax saving instruments. But last year financial budget removed thisrestriction andnow any individual can invest in ELSSirrespective of their income level.Advantages of ELSS over NSC and PPF1. Main advantage of ELSSis its short lock-in period. Maturity period of NSC is 6 yearsand PPF is 15 years.2.Since it is an equity linked scheme earning potential is very high.3. Investor can opt fordividend option and get some gains during the lock-in period4. Investor can opt forSystematic Investment Plan5.Some ELSSschemes also offer personal accident death cover insurance6. Provides 30 to 40%returns compared to 8% in NSC and PPFDisadvantages of ELSS1. Risk factor is high compared to NSC and PPF2. Premature withdrawal is not allowed but it is allowed in otherinstruments in somespecific conditions.32Diversified Equity Schemes and ELSSBoth Equity linked saving scheme and diversified equity scheme operates in sameway.Both are high return and high risk schemes. But there is a 3 year lock in periodof ELSSand it provides tax benefits too.Systematic Investment PlanBest way to invest in ELSS
  19. 19. is throughSystematic Investment Plan(SIP). WithSIP youcan invest a small amount every month for a specific time period. WithSIP investor cantake advantage of fluctuations in the stock market.So investor will get more units whenthe market is down and get less units when themarket is up. For eg if you are investingRs 1000 every month and you will get 100units for when Net Asset Value (NAV) is 10and will get 50 units when NAV is 20.So investing a fixed sum regularly helps to cover the market fluctuations by rupeecosts averaging. Also most of the Asset ManagementCompanies (AMC) chargesless entry load forSIP compared to normal purchase.33PRODUCT OFFERED TO CUSTOMR BY LICChildrens PolicyyKomal Jeevan - Plan No. 159yChildren Deferred - Plan no.41yJeevan Kishore - Plan no.102yJeevan Chhaya - Plan no.103yMarriage Endowment/Educational Annuity - Plan No. 90yJeevan Anurag - Plan no.168Endowment PolicyyEndowment with Profits - Plan no.14 Limited PaymentyEndowment with Profits ± Plan no.48yJeevan Mitra ± Plan no.88yNew JanaRaksha Policy ± Plan no. 91yJeevan Anand Plan no. 149yJeevan Mitra Triple Cover ± Plan no.113Group Insurance PolicyyJanashree Bima Yojana
  20. 20. yGroup InsuranceScheme in lieu of EDLIyGroup (Trem) InsuranceSchemeyGroupSaving Linked InsuraceSchemeyGroupSuperannuationSchemeyGroup Mortgage Redemption AssuranceSchemeJoint Life PolicyyJeevanSaathi - Plan no.8934Money Back PolicyyMoney Back with Profit - Plan no.75yNew Money Back ± Plan no.93yJeevanSurabhi 15 yrs ± plan no.106yJeevanSurabhi 20 yrs ± plan no.107yJeevanSurabhi 25 yrs ± plan no.108yJeevan Bharati Plan no.160y
  21. 21. JeevanSamriddhi Plan No 154, 155, 156, 157yBima Bachat ± Plan no.175Pension Plans or AnnuitiesyNew Jeevan Dhara - Plan no.148yNew JeevanSuraksha Plan no. 147yJeevan Akshay IInd Plan no. 163yJeevan Nidhi Plan no.169yJeevan Akshat V Plan no.183Special PlansyTerm Assurance - Plan no.43yMortgage Redemption - Plan no.52yJeevan Aadhar - Plan no.114yMarket Plus - Plan No 181yJeevan Vishwas Plan No. 136yJeevanSaral Plan No. 165Jeevan Pramukh Plan No. 167yBima Nivesh 2005 Plan No 171yMoney Plus-Plan No 180Term PolicyyConvertible Term Assurance - Plan no.58yNew Bima KiranyTrem AssuranceyAnmol Jeevan I Plan No.-164yAmulya Jeevan-Plan No-17735JEEVAN AKSHAY PLAN
  22. 22. Introduction:It is an Immediate Annuity plan, which can be purchased by paying a lump sumamount.The plan provides for annuity payments of a stated amount throughout thelife time of the annuitant. Various options are available for the type and mode ofpayment of annuities.Type of Annuity:yAnnuity payable for life at a uniform rate.yAnnuity payable for 5, 10, 15 or 20 years certain and thereafter as long astheannuitant is alive.yAnnuity for life with return of purchase price on death of the annuitant.yAnnuity payable for life increasing at a simple rate of 3% p.a.yAnnuity for life with a provision of 50% of the annuity payable to spouseduringhis/her lifetime on death of the annuitant.yAnnuity for life with a provision of 100% of the annuity payable to spouseduringhis/her lifetime on death of the annuitant.Mode:yAnnuity may be paid either at monthly, quarterly, half yearly or yearly intervals.Youmay opt any mode of payment of Annuity.Salient features:yPremium is to be paid in a lump sum.yMinimum purchase price : Rs.50,000/= or such amount which may secure aminimumannuity as under:ModeMinimum AnnuityMonthly Rs. 500 per monthQuarterly Rs. 1000 per quarter Half-yearly Rs. 2000 perhalf year Yearly Rs. 3000 per yearyNo medical examination is required under the plan.yNo maximum limits for purchase price, annuity etc.yMinimum age at entry 40 years last birthday and Maximum age at entry 79 yearslastbirthday.yAge proof necessary.36Annuity Rate:Amount of annuity payable at yearly intervals which can be purchased for Rs. 1lakhunder different options is as under:Incentives for high purchase price:
  23. 23. If your purchase price is Rs. 1.50 lakh or more, you will receive higher amount ofannuity due to available incentives.Cooling-off periodIf you are not satisfied with the ³Terms and Conditions´ of the policy, you may returnthepolicy to us within 15 days from the date of receipt of the Policy Bond. On receiptof thepolicy we shall cancel the same and the amount of premium deposited by youshall berefunded to you after deducting the charges for stamp duty.Section41of Insurance Act1938:yNo person shall allow or offer to allow, either directly or indirectly, as aninducementto any person to take out or renew or continue an insurance inrespect of any kind ofrisk relating to lives or property in India, any rebate of thewhole or part of thecommissionpayable or any rebate of the premium shown onthe policy, nor shall any persontaking out or renewing or continuing a policyaccept any rebate, except such rebateas may be allowed in accordance with thepublished prospectuses or tables of theinsurer: provided that acceptance by aninsurance agent of commission in connectionwith a policy of life insurance takenout by himself on his own life shall not be deemedto be acceptance of a rebateof premium within the meaning of this sub-section if atthe time of suchacceptance the insurance agent satisfies the prescribed conditionsestablishingthat he is abona fideinsurance agent employed by the insurer. Any person making default in complyingwith the provisions of this section shallbe punishable with fine which may extend tofive hundred rupees.Age last birthdayYearly annuity amount under option(i)( ii ) (15 years certain)( iii )( iv )(v)( vi )40 7510 7440 6930 5610 7310 712045 7770 7660 6960 5890 7500 724050 81407950 7000 6280 7760 742055 8650 8330 7050 6810 8130 767060 9350 8790 71107530 8640 803065 10410 9330 7180 8590 9400 857070 12080 9830 7260 1022010560 937075 14510 10220 7360 12590 12240 1059037BENEFITS OF PLANThe amount of annuity is assured throughout life of the annuitant.What happens if the annuitant dies?If the annuitant dies :1.U
  24. 24. nder option (i) annuity ceases.2.Under option (ii)3. On death during the guaranteed period - annuity is paid to thenominee till theend of the guaranteed period after which the same ceases.4. Ondeath after the guaranteed period - annuity ceases.5.Under option (iii) annuity ceases and the purchase price is paid to the nominee.6.Under option (iv) annuity ceases.7.Under option (v) annuity ceases and 50% of the annuity is payable to thesurvivingnamed spouse during his/her life time. If the spouse predeceases theannuitant, theannuity ceases.8.Under option (vi) annuity ceases and full annuity is payable to the survivingnamedspouse during his/her life time. If the spouse predeceases the annuitant,the annuityceases.When first instalment of annuity payable:First instalment of annuity is payable after one month, three months, six months orone year from the date of purchase of annuitydepending on the mode chosen ismonthly, quarterly, half yearly or yearly respectively.38JEEVAN SARAL POLICYProduct Summary:This is an Endowment Assurance plan where the proposer has simply to choosetheamount and mode of premium payment. The plan provides financial protectionagainstdeath throughout the term of the plan. The death benefit is directly related tothepremiums paid. The MaturitySum Assured depends on the age at entry of the life to beassured and is payable onsurvival to the end of the policy term. It also offers theflexibility of term and a lot ofliquidity.Premiums:Premiums are payable yearly, half-yearly, quarterly, or monthly throughsalarydeductions as opted by you throughout the term of the policy or till earlierdeath.Loyalty Additions:This is a with-profits plan and participates in the profits of the Corporation¶slifeinsurance business. It gets a share of the profits in the form of loyalty additionswhichare terminal bonuses payable along with death benefit or maturity benefit.Loyalty Additions may be payable from the 10th year onwards depending upon theexperienceof the CorporationDeath Benefit:250 times the monthly premium together with loyalty additions, if any, and return ofpremiums excluding first year premiums and extra/rider premium, if any, is payableinlump sum on death of the life assured during the term of the policy.Maturity Benefit:The MaturitySum Assured plus Loyalty additions, if any, is payable in a lump sum.
  25. 25. Supplementary/Extra Benefits:These are the optional benefits that can be added to your basic plan forextraprotection/option. An additional premium isrequired to be paid for these benefits.Surrender Value:Buying a life insurance contract is a long-term commitment. However, surrendervaluesare available on earlier termination of the contract. The surrender value will bethegreater of the guaranteed surrender value and special surrender. The plan alsoallowsfor partial surrenders.39Guaranteed Surrender Value:The policy can be surrendered after it has been in force for at least 3 full years.TheGuaranteedSurrender value will be equal to 30% of the total amount of premiums paidexcludingthe premiums for the first year and all the extra premiums and premiums for accidentbenefit / term rider.Special Surrender Value:80% of MaturitySum Assured if 3 or more years¶ but less than 4 years¶ premiums havebeen paid;90% of the MaturitySum Assured, if 4 or more years¶ but less than 5 years¶premiums have been paidand 100% of the MaturitySum Assured, if 5 or more years¶premiums have been paid. The MaturitySum Assured for this para will be the MaturitySum Assured corresponding to the term for which premiums have been paid underthepolicy.Statutory warning:³Some benefits are guaranteed and some benefits are variable with returns basedonthe future performance of your life insurance company. If your policy offersguaranteed returns then these will be clearly marked ³guaranteed´ in the illustrationtable on this page. If your policy offers variable returns then the illustrations on thispage will show two different rates of assumed investment returns. These assumedrates of return arenot guaranteed and they are not upper or lower limits of what youmight get back as thevalue of your policy is dependant on a number of factorsincluding future investment performance.´Age at entry: 35 yearsPolicy term: 25 yearsMode of premium payment: YearlyAmount of annual premium: Rs.4704/-40End Of PolicyYear TotalPremium paid till endof yearAmount payable at the end of year on death during the year(Rs.)GuaranteedVariable TotalScenario 1 Scenario 2 Scenario 1 Scenario 21 4704100000 0 0 100000 1000002 9408 104800 0 0 104800 1048003 14112 109600 0 0109600 1096004 18816 114400 0 0 114400 1144005 23520 119200 0 0 1192001192006 28224 124000 0 0 124000 1240007 32928 128800 0 0 128800 128800837632 133600 0 0 133600 1336009 42336 138400 0 0 138400 13840010 47040
  26. 26. 143200 7000 18000 150200 16120015 70560 167200 13000 41000 18020020820020 94080 191200 30000 100000 221200 29120025 117600 215200 65000211000 280200 42620041End Of Policy Year TotalPremium paidtill end of yearAmount payable on surrender or maturity at the endof yearGuaranteedVariable TotalScenario 1 Scenario 2Scenario1Scenario21 4704 0 0 0 002 9408 0 0 0 0 03 14112 8099 0 0 8099 80994 18816 12942 0 0 12942 12942523520 18660 0 0 18660 186606 28224 23180 0 0 23180 231807 32928 27856 0 027856 278568 37632 32744 0 0 32744 327449 42336 37892 0 0 37892 378921047040 43360 7000 18000 50360 6136015 70560 75200 13000 41000 8820011620020 94080 106124 30000 100000 136124 20612425 117600 135296 65000211000 200296 346296i) This illustration is applicable to a non-smoker male/female standard (from medical,lifestyle and occupation point of view) life.ii) The non-guaranteed benefits (1) and (2) in above illustration are calculated so thatthey are consistent with the Projected Investment Rate of Return assumption of 6%p.a.(Scenario 1) and 10% p.a. (Scenario 2) respectively. In other words, in preparingthis benefit illustration, it is assumed that the Projected Investment Rate of Returnthat LICI will be able to earnthroughoutthetermofthepolicywill be 6% p.a. or 10% p.a.,as the case may be. The Projected Investment Rate ofReturn isnotguaranteed.iii) The main objective of the illustration is that the client is able to appreciatethefeatures of the product and the flow of benefits in different circumstances withsomelevel of quantification.iv) Loyalty additions will depend on future profits and as such is not guaranteed.v) The Maturity Benefit is the amount shown at the end of the policy term.42SMALL SAVINGThere are different kinds ofSmallSavingsSchemes suitable for various segments of the population.The Government of Indiahave reduced the rate of interest for many of theSmallS
  27. 27. avingsScrips w.e.f. 01.03.2003 as follows:Sl.No.Scheme Rate of Interestw.e.f. 01.01.2001Rate of Interestw.e.f. 01.03.2002Rate of Interestw.e.f. 01.03.20031. POMIS 9.50 % 9.00 % 8.00 %2. 1 YEAR TD7.50 % 7.25 % 6.25 %2 YEARTD8.00 % 7.50 % 6.50 %3 YEAR TD9.00 % 8.25 % 7.25 %5 YEAR TD9.00 % 8.50% 7.50 %3. PORD Rs. 10 becomesRs. 758.53 after 5 yearsRs. 10 becomesRs.748.49 after 5 yearsRs. 10 becomesRs. 728.90 after 5 years4. NSC- VIII 9.50 %9.00 % 8.16 %5. PPF 9.50 % 9.00 % 8.00 %6. KVP Doubles inseven years andthreemonthsDoubles inseven years and eightmonthsDoubles inEight years andsevenmonths7. POSA 4.50 % 3.50 % 3.50 %8. SCSS 9.00%* - NSS -92 Schemewas withdrawn by the G.O.I. w.e.f01.11.2002The SCSS introduced w.e.f. 1-7-200443PAY ROLL SAVING SCHEME:Under this scheme, any monthly salaried person can voluntarily authorise hisappointingauthority or employer to deduct monthly contributions from his salary andto remit intoanyone of the savings schemes like Post Office Recurring Deposit, PostOffice TimeDeposit, NationalSavings Certificate (VIII issue) and Public Provident FundScheme.The group leader appointed in each organization for collection purpose ispaid 2%commission for his service who implements the scheme in the respectiveconcern.Geographical Data of LICDetails of Waste Lands in India as per (NRSA) EstimatesDetailsArea in m.ha.Culturabel WastelandsSaline3.9Gullied and Ravinous4.32Waterlogged0.89Undulating uplands with or without Scrub10.79Jhum Cultivation and Forest Blanks2.4Sandy Areas10.53Total32.83Unculturable Wastelands
  28. 28. Barren Hills and Rock out-Crops2.75Snow Bound Area17.7Total20.45Grand Total53.2844State-wiseLength of Coastline and Populationin India(1991)States/UTsLength of Coastline(Km.)Area( 000 Sq.Km.)Population 1991(Lakh)Gjrt ua a1600196.0041.20Mas arh hat a r840307.7078.70Goa3003.701.20Krak ata na400191.8044.80Wel en sg B ta95088.7068.00Tmau ai d N l720130.1055.60Oa s is r560155.7031.50Krl ea a101439.0029.00AdrPds nh re aa h960275.0066.30
  29. 29. AdmnNbrns na a&ioa d c Il sa-8.500.30Lkawp ahde s e-0.030.05Dam Commenced through Decades in IndiaDecades/Periods No. BuiltBefore 1900421901-1950 2511951-1960 2341961-1970 4611971-1980 11901981-199010661991-1996 1161996-2000 69545BANKS AND FINANCIAL INSTITUTIONSFinancial Institution-wise Disbursement in India(2000-2001 to 2002-2003)(Rs. in Crore)Institution2000-012001-022002-03IDBI1743.611513924.2IFCI2152.71096.91796.5ICICI31664.525831-IIBI1709.810701091.9IDFC766.51506.1949.3SIDBI6441.45919.36789.4Exim Bank2070.53869.26047.8NABARD14121897
  30. 30. 2216.446Statewise Priority Sector Lending of PublicSector Banks in India(1997 to 1999)(Rs. in Crore)States/UTsMarch199719981999Andhra Pradesh7205.628727.809202.44Arunachal Pradesh20.2723.7929.93Assam1018.89963.161083.80Bihar2993.983107.433604.20Goa269.47339.87421.09Gujarat4675.295542.486228.66Haryana2487.612893.733506.50Himachal Pradesh487.06558.05640.79Jammu & Kashmir247.54302.80342.98Karnataka5971.127017.598601.58Kerala
  31. 31. 3395.403499.603918.86Madhya Pradesh4205.574909.415638.55Maharashtra10453.2612697.6815457.85Manipur96.31102.86111.10Meghalaya49.2662.0567.02Mizoram19.1822.7227.35Nagaland66.4658.9265.90Delhi3743.134639.575902.95Orissa1901.252089.202105.74Punjab4695.325502.576583.48Rajasthan2808.413614.734197.77Sikkim17.6324.6727.82Tamil Nadu9049.199736.06
  32. 32. 10467.29Tripura122.53132.43138.73Uttar Pradesh7435.398360.689298.93West Bengal4639.255155.675680.61Andaman & Nicobar Islands15.9716.9024.89Chandigarh509.34509.27576.50Dadra & Nagar Haveli6.3611.9917.04Daman & Diu6.597.508.40Lakshadweep1.762.162.27Pondicherry104.73104.33113.1047State-wise Net Small Savings Collections in India(1998-99 to 2001-02)(Rs. in Crore)States/UTsNet Amount (including P.P.F.)Collected through Post Offices1998-991999-20002000-012001-02Andhra Pradesh1121.101566.331809.68
  33. 33. 1752.95Assam95.29464.63513.74471.08Arunachal Pradesh14.3910.2915.3211.71Bihar1676.501970.522210.291438.79Bihar-Jharkhand--0.00881.79Gujarat2661.903276.964281.253759.71Goa74.4280.94102.47110.20Haryana907.32970.23978.181129.83Himachal Pradesh60.69(-)507.27235.79304.12Jammu & Kashmir231.36254.98300.34273.00Karnataka1162.161336.941570.96
  34. 34. 1366.66Kerala555.54689.62491.71495.46Madhya Pradesh1021.851215.50993.281184.73M.P. Chattisgarh--363.68326.39Maharashtra2977.833171.764100.363406.98Manipur16.5721.3925.4713.48Meghalya21.1219.7233.0724.17Mizoram7.908.5115.489.75Nagaland7.806.148.6613.26Orissa435.06521.18545.18569.98Punjab1642.081920.042181.06
  35. 35. 1832.03Rajasthan1594.022203.262609.222973.24Sikkim9.4112.0512.709.41Tamil Nadu874.191304.501600.221520.98Tripura71.71104.70138.27126.06Uttar Pradesh3717.514334.124042.993979.95Uttaranchal--462.60484.07West Bengal4424.085249.126181.676488.02Andaman & Nicobar Islands4.821.73(-)4.371.11Chandigarh31.0117.143.4051.85Daman & Diu5.395.734.27
  36. 36. 2.47Delhi1326.291087.931672.061571.74Lakshadweep0. Post Office13.4823.3618.3928.79Pondicherry8.2620.9061.4780.88India26771.1031363.1537578.9736694.6948RESEARCH METHODOLOGYTOPIC:-ANALYTICAL STUDY OF SAVING SCHEMEDURATION:-45DaysResearch methodology systematically solves the research problems. It hasmanydimensions & research methods constitute a part of the research methodology.Thus when we talk about research methodology , we do not only talk of theresearchmethods but also consider the logic behind the methods. We use beingevaluatedeither by researcher himself or by others.To effectively carry out in research , I would use the following researchprocess,which consists of series of actions or steps.1. Formulating the researchproblems.2. Research design & sample design3. Analysis of data gathered.4.Graphics & interpret.1.FORMULATING THE RESEARCH PROBLEM
  37. 37. This is the first step under which the problem is stated in general way &thenambiguities that is understanding & rephrasing the problems thoroughly &rephrasingthe same into a meaningful terms from an analysis point of view.2.REPARING THE RESEARCH DESIGNThe function of research design is to provide for the collection of relevantevidenceswith minimal expenditures of efforts, time & money.RESEARCH DESIGNTypes of researchSample of designTypes of ResearchThe type of research under present is an Analytical Research. In analyticalresearchwe use facts or information already available, & analyze these to makea criticalevaluation of the material . Hence the same would be done .In this project , I had collected facts , data & information .49Sample DesignA sample design is a definite plan determined before any data is actually collectedforobtaining a sample. Researcher must select a sample design, which shouldbereliable & appropriate for this report.3.OBSERVATIONAL DESIGN (COLL4ECTION OF DATA)Observational design relates to the condition under which the observations are tobemade observational design in respect to research . There are several ways ofcollectingthe appropriate data , which differ considerably in context of money , time ,cost & other resources at the disposal of the researcher.Data can be obtained fromtwo important resources :Primary DataSecondary DataPrimary DataPrimary data are the data that are collected afresh & for the first time. Thus happenstobe in character. Primary data are collected by the following ways:ObservationsInterviewSchedule
  38. 38. QuestionnaireSecondary DataSecondary data are the data that are collected & are already collected & areonlyanalyzed by different sources. These are as follows:Corporate magazineManuals of various companiesBooks, journals & newspaperEmployment exchangeI collected the secondary data from internet, mainly fromannual reports of AXISBANK& Books of different authors of repute.50DATA ANALYSIS & INTERPRETATIONDATA GIVES PREFERENCE OF RESPONDENTS OF INSURANCE COMPANIESCOMPANY¶S NAMENO.OFRESPONDENTSHARE (%)L.I.C. 7878RELIANCE LIFEINSURANCE33ICICI PRUDENTIAL1010SBI LIFE 7 7HDFC22TOTAL100100INTERPRETATION78% of the people contacted prefer LIC policy to any other and therefore it isrankedno.1 by that percent of respondents.DATA GIVES BENEFITS OF INSURANCE PERCEIVED BY RESPONDENTS7831072LICRELICICISBIHDFC51BENEFITSNO.OFRESPONDENTSSHARE (%)Cover FutureUncertainty 55 55Tax Deductions 20 20Future Investment 25 25TOTAL 100 100INTERPRETATION
  39. 39. 55% of the respondents believe that covering future uncertainty is the biggest benefitof an insurance policy.Whereas, 20% and 25% of them believe that the otherbenefits are Tax deduction andfuture investments respectively.55%20%25%Cover FutureUncertaintyTax DeductionsFuture Investment52DATA PROVIDES FEATURES OF INSURANCE POLICY THATATTRACTEDRESPONDENTSINTERPRETATIONMajority of the respondent (37%) found Larger risk coverance as the mostattractedfeature of the all.15%37%7%30%11%FEATURES OFINSURANCEPOLICYMONEY BACK GUAARENTEELARGER RISK COVERANCEEASY ACCESSTO AGENTSLOW PREMIUMREPUTATION OF COMPANYFEATURE NO.OFRESPONDENTSSHARE (%)Money Back Guarantee 15 15Larger Risk Coverance 37 37Easy Access to Agents 7 7LowPremium 30 30Company¶s Reputation 11 11TOTAL 100 10053DATA PROVIDES NUMBER OF INSURANCE POLICY TYPERESPONDENTSINTERPRETATION75% of the respondents have Life Insurance Policy while 45% have both. (The %iscalculated out of 280 positive response)752545NATURE OF POLICYLIFE POLICYNON LIFE POLICYBOTHPOLICY TYPE NO. OFRESPONDENTSSHARE (%)LIFE POLICY 75 75NON LIFE POLICY 25 25BOTH 45 4554DATA GIVES PEOPLE PERCEPTION ABOUT INSURANCERESPONSENO. OFRESPONDENTSSHARE (%)A saving tool 8181%A tax saving device 74
  40. 40. 74%A tool to protect your family 100100%INTERPRETATION81% of the respondents have perception of Insurance being a saving tool. And 74%of the respondents have perception of Insurance being a tax saving device.But 100%of the respondents are with the view that Insurance is a tool to protect your family.0817410000SAVINGTOOLTAXSAVINGTOOLFAMILYPROTECTION55DATA SHOWS PEOPLES HAVING INSURANCERESPONSENO. OFRESPONDENTSSHARE (%)Yes 7070%No 3030%Total 100100%INTERPRETATIONOf the sample size of 400 surveyed respondents 70% of the respondents arehavingInsurance policy.30% of the respondents are either not having any Insurancepolicy at present or their policy is already matured. And at present 100% of therespondents are with the view that Insurance is a tool toprotect your family.70%30%YesNo56DATA SHOWS BUYING PROCESS OF THE PEOPLEBUYING PROCESS NO. OFRESPONDENTSSHARE (%)Customer approachedInsurance company/Agent4545%Company/agent approachedcustomer 55555Total 100100%INTERPRETATION44.5% of the respondents approached the Insurance Company / Agent.Whereas,55.5% of the respondents were approached by the Company /Agent.44%56%Customer approached Insurance company/AgentCompany/agent approached customer57DATA SHOWS REASONS BEHIND FOR INSURANCERESPONSE
  41. 41. NO. OFRESPONDENTSSHARE (%)Tax saving 8080%Saving / Investment 8080.%Family protection 100100%INTERPRETATION80.71% of the Respondents opted for Insurance for tax saving benefits.80.71% ofthe Respondents opted for saving / Investments.But all of them, i.e. 100% of therespondents have opted for insurance for their familyprotection.808010058DATA SHOWS SATISFACTION OF RESPONDENTS WITH RESPECT TO POLICYRESPONSE NO. OFRESPONDENTSSHARE (%)Satisfied 6060%Not satisfied 4040%Not Responded 00.0%Total 100100%INTERPRETATION60% of the respondents are more or less satisfied with their existing policy.40% ofthe respondents are not satisfied with their existing policy.In this case all of thosewho have taken a policy have responded.60%40%0%Satisfied Not satisfied Not Responded59DATA SHOWS SATISFACTION OF +RESPONDENTS WITH RESPECT TOSERVICEAGENTRESPONSE NO. OFRESPONDENTSSHARE (%)Satisfied 4545%Not satisfied 5555%Not Responded 00.0%Total 100100%INTERPRETATIONy45% of the respondents are satisfied with their existing service agent.y
  42. 42. 55% of the respondents are not satisfied with their existing insurance agent.yAll of those who have taken a policy have responded.45.00%55.00%Satisfied Not satisfied60DATA SHOWS NUMBER OF RESPONDENTS PAYING TAXRESPONSE NO. OFRESPONDENTSSHARE (%)Paying tax 100100%Not paying tax -0%Total 100100%INTERPRETATIONyOf the sample size of 400 respondents, all the respondents are paying tax.100%0%Paying tax Not paying tax61DATA SHOWS RESPONDENT¶S INVESTMENTS FOR TAX SAVINGINVESTMENTSNO. OFRESPONDENTSSHARE (%)LIC 5151%NSC3333%Bonds 3232%PPF2525%PF2121%EPF 1111%INTERPRETATIONy51% of the respondents save their tax by investing in LIC, which is the highestamongall Investment. This shows that most people for getting taxes benefits investin LIC.y33.25% of the respondents do their tax saving by investing in NSC.y
  43. 43. 32.25% of the respondents to their tax saving by investing in bonds.513332252111L I C N S CB O N D P PF P F E P F62DATA SHOWS RESPONDENTS PERCEPTION ABOUT BEST FORM OFINVESTMENTFOR SECURING THEIR FUTURENO. OFRESPONDENTSSHARE (%)Fixed Assets 7575%Bank deposits 1111%Jewellery 2525%Securities i.e. bonds, MFs 40.40%Shares 1010%Insurance 7070%INTERPRETATIONy75.25% of the respondents as with the view that Fixed Assets is the best form ofinvestment for securing their future.y70.5% of the respondents are with the perception that Insurance is the best form ofinvestment for securing their future, which is one of the highest and this showsthatinsurance is an important key for securing your future.751125401070Fixed AssetsBank depositsCash & JewellerySecurities i.e.bonds,MFsSharesInsurance63DATA SHOWS WHAT PEOPLE INTENT TO GAIN FROM THEIR INVESTMENTRESPONSENO. OFRESPONDENTSSHARE (%)Saving & Returns 100100%Security 9090%Tax benefits 71.71.%INTERPRETATIONy100% of the respondents intent to gain saving and returns from their investment.
  44. 44. y90% of the respondent¶s intent to gain security from their investments.yWhereas, 71.75% of the respondent¶s intent to gain tax benefits from theirinvestments.1009071Saving & Returns Security Tax benefits64DATA GIVES PEOPLE¶S PERCEPTION ON APPROPRIATE AGE FORBUYINGINSURANCERESPONSE NO. OF RESPONDENTSSHARE (%)After 25 years 2929%After 35 years 1010%After 45 years 00%Anytime 6060%INTERPRETATIONy29% of the respondents are with the view that insurance should be bought aftertheage of 25 years.y10.5% of the respondents are with the view that insurance should be buyed after theage of 35 years.yWhereas, 60.5% of the respondents are with the view that buying of insurance donothave any thing to do with age i.e. there is no age limitations. It can bepurchased anytime according to the need.29%10.10%0%60.61%After25y e a r s A f t e r35years After45years Anytime65DATA SHOWS PEOPLE OPINION ABOUT INDIAN INSURANCE COMPANIESRESPONSENO. OFRESPONDENTSSHARE (%)Rigid plans 6767%Non user friendly 2929%Unsatisfactory services 2626%
  45. 45. Non Aggressive 3535%Satisfactory 2424%Good 1010%Very good 00%INTERPRETATIONy67% of the respondents have the opinion that Indian Insurance Companies haveRigidplans.y29.5% feel that Indian Insurance companies are Non-user friendly.y26.5% feel that services of Indian Insurance companies are Unsatisfactory.y35.75% of the respondents are with the view that Indian Insurance companies areNon-aggressive.y24% of the respondents feel that products and services of IndianInsurancecompanies is Satisfactory.yWhereas only10.25% feel that it is Good enough.yAnd according to the data, no single person has felt that it is very good.6729263324100Inflexible plans Non user friendlyU n s a t i s f a c t o r ys e r v i c e s N o nA g g r e s s i v e Satisfactory GoodVery good66
  46. 46. DATA SHOWS WHAT PEOPLE WOULD LOOK FOR IN AN INSURANCE COMPANYRESPONSENO. OFRESPONDENTSSHARE (%)A trusted name 8282%Friendly service &responsiveness7171%Good plans 8181%Accessibility 4949%INTERPRETATIONy82% customers look for a Trusted name in a company for insurance.y81.5% customers look for a good plan in a company for insurance.yFriendly service & responsiveness and Accessibility are also important factorslooked bycustomers in a company.82718149AtrustednameFriendly service & responsivenessGood plansAccessibility67DATA SHOWS PEOPLE PLANNING FOR NEW INVESTMENTSRESPONSE NO.OFRESPONDENTSSHARE (%)Planning 87 87% Not planning 13 13%Total 100 100%INTERPRETATIONyOnly 12.5% of the customers contacted are not planning for new investmentspresently.yWhereas, 87.5% of the customers are still planning for new investments this can bea great potential for Reliance Life Insurance to take them on their favor.87.0%13.0%Planning Not planning68DATA SHOWS PEOPLE INTERESTED IN GOING FOR INSURANCE IF ASERVICEPROVIDER AWAY FROM THE CITY OFFERS BETTER SERVICE &PRODUCTSRESPONSENO. OFRESPONDENTSSHARE (%)Yes 4343%No4444%Uncertain 1313%Total 100100%INTERPRETATION
  47. 47. The interested customers i.e. 43% are ready to go for insurance even away from acity if servicesand products are worthwhile, which again is a good prospect(potential) for Life InsuranceCorporation of India to take them on their favor.43%44%13%Y e sN o U n c e r t a i n69ConclusionAfter Finding¶s we can see about LIC features and his The tendency to takethe expedient approach and focus on the far right of the LIC spectrum,Peacetime Contingency Operations and conduct training as usual, whilebriefing that the LIC block has been checked, will lead us to a possibly fatalfalse sense of security.Instinctive behavior and ingrained training must be adjusted to fit newcircumstances.STXs must be developed locally or borrowed from unitswhohave already been through the training.The probability of becoming involved in a LIC operation is high. Thepotentialto attract international attention, even with limited forces, is alsogreat.Unitshave demonstrated that with a balanced training focus andproperpreparation, many pitfalls outlined above can be avoided.LIC is not conventional warfare. This is critical for the counterinsurgent tounderstand. The insurgent¶s violent and coercive strategy is applied so astoachieve political, civil, military and psychological results. Hence, thecounterinsurgent must counter all of these strategic elements individually.Inaddition, the target of the insurgent¶s violence and coercion is the population. Thisisbecause the population is the centre of gravity in LIC. Therefore thecounterinsurgentmust also focus on the population to be successful. In terms ofmilitary principles incounterinsurgency, doctrinal precision, professionalism,independence, initiative, forceprecision, restraint, combined arms, precisionengagement, joint force, effectivepopulation based intelligence, integratedcommunications, a civil affairs approach andhigh levels of training are critical.So we can say that so many merit¶s and Demerit¶s in life insurance Corporation ofIndia.70SWOTANALYSIS1STRENGTHS1)Strong brand name2)Large customer base3)Enhanced quality and long term service commitments
  48. 48. 4)Product preference by customers2WEAKNESSES1)New products did not embark predicted sales.2)New / change look is not undertaken in new products.3OPPORTUNITIES1)Competition is paving way for developing fuel efficient product likesplendor.2)Upper rich segments are need to be targeted.3)Stylish look need to be adopted in products as per youthdemanding.4THREAT1)Competition is getting tougher every day.2)Rival companies are making their every moves to fightcompetition.3)Customers are moving towards four wheeler segment.71AppendixesPERFORMANCE HIGHLIGHTSQ4FY08‡ Net Profit 71 % yoy 63 % yoy‡ Net Interest Income 89 % yoy 76 % yoy‡ FeeIncome 67 % yoy 70 %yoy‡ Operating Revenue 87 % yoy 77 %yoy‡ OperatingProfit 82 % yoy 76 % yoy‡ Net Interest Margin 3.93 % 3.47 %‡ Cost of Funds 5.82% 6.02%72QUESTIONNAIRE1.ARE YOU EMPLOYED?YESNOIf YES, only then proceed2.
  54. 54. 78BIBLIOGRAPHYAnnual Report of LIC from 2004 to 2009C.R. KOTTHARI, RESEARCH METHODOLOGYInternet PortalPress Release 08 ± 09 & 09-10 of LIC.Analyst PPT 08 ± 09 & 09-10 of LIC.Annual Performance Report.News Paper and Magazines:Business World April ± June Editions.4P¶s of Marketing April ± June Editions.Economic Times April ± June Editions
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  57. 57. RESEARCH METHODOLOGY DATA ANALYSIS & INTERPRETATION SWOT ANALYSIS QUESTIONNAIREInfo and RatingCategory: Uncategorized.Rating:Upload Date: 11/01/2011Copyright: Attribution Non-commercialTags: This document has no tags.Free download as PDF File (.pdf), text file (.txt) or read online for free.Flag document for inapproriate contentRelated 9 p.liciRana Chakraborty48 Reads
  58. 58. 18 p.licLalit Kashyap82 Reads 48 p.Lic and Max New York Life Insurance AnalysisRahul Jamdagni383 ReadsNext
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