The document provides information on various business services in India including top banks, insurance companies, and logistics companies. It discusses the meaning and functions of banking, insurance, and different types of insurance policies like life and fire insurance. It explains the key principles of insurance including insurable interest, utmost good faith, indemnity, and subrogation. It also outlines the advantages and costs of insurance as well as the characteristics of marine and fire insurance.

1. INTERMEDIATE II Year – COMMERCE
UNIT 3
BUSINESS SERVICES
Dr. K. THULASI KRISHNA, Ph.D.
AP MODEL SCHOOL & JUNIOR COLLEGE
KANEKAL – ANANATHAPUR (Dt.), AP., INDIA
tkk2007@gmail.com

2. Top 10 Banks in India
(Source: mymoneymantra.com, May 2021)
Top 10 Insurance Companies in India
(Source: turtlemint.com, May 2021)
Top 10 Logistics Companies in India
(Source: nies-in-cdn.amproject.org, May 2021)
HDFC Bank LIC of India Container Corporation of India Ltd.
State Bank of India Max Life Insurance Company Allcargo Logistics Ltd.
ICICI Bank Ltd. HDFC Life Insurance Company Aegis Logistics Ltd.
Kotak Mahindra Bank Ltd. ICICI Prudential Life Insurance Mahindra Logistics Ltd.
Axis Bank Ltd. Tata AIA Life Insurance Company Transport Corporation of India Ltd.
IndusInd Bank Ltd. Bharti AXA Life Insurance Company VRL Logistics Ltd
Yes Bank Ltd. Bajaj Allianz Life Insurance Company TCI Express Ltd.
Punjab National Bank SBI Life Insurance Company Gateway Distriparks Limited
Bank of Baroda Reliance Nippon Life Insurance
Company
Future Supply Chain Solutions Ltd.
Bank of India AEGON Life Insurance Company Adani Logistics Company

3. Business
Services -
Meaning
• Business services can be
defined as various tasks
and activities that help
maintain a business.
• Examples: Banking,
Insurance, Transportation,
Computer services, etc.

4. Banking - Definition
• According to Indian Banking
Regulation Act 1949, banking
means “accepting for the
purpose of lending or
investment of deposits of
money from the public,
repayable on demand or
otherwise, and withdrawable
by cheque, draft or otherwise.”

5. Functions of Banks
A) Primary B) Secondary
Accepting
deposits
Granting of
loans
Provision of
payment
system
Credit
creation
Agency
services
General utility
services
New services

6. A. Primary Functions
• Accepting deposits: Banks
accept various types of deposits
like fixed deposits, current
deposits, savings deposits and
recurring deposits.
• Advancing of loans: After
keeping required cash reserves,
the banks lend their deposits to
the borrowers in form of Money
at call and short notice, Cash
credit, Overdraft, Loans.

7. iii. Provision of Payment System
• Banks create very useful medium of
exchange in the form of cheque.
Through cheque, the depositor directs
the bankers to make payment to the
payee.
iv. Credit Creation
• It is a natural outcome of the process
of advancing loan as adopted by the
banks. Banks can create credit many
times more than the deposits.

8. B) Secondary Functions
i. Agency Services
• Banks help their customers in transferring funds from one place to
another through cheques, drafts, bills etc.
• They undertake to buy and sell securities like shares, bonds,
debentures etc., on behalf of their customers.
ii. General Utility Services
• Letters of credit are issued by the banks to their customers
certifying their credit worthiness.
• They provide safe deposit lockers facilities to the customers at
selected branches.

9. iii. New Services
• Free cheque book
• Anywhere banking in India
• Free internet banking

10. Insurance - Meaning
• Insurance is a means of protection from financial loss.
• It is a provision against risk.
• Insurance is a form of contract in which one party
agrees to compensate the loss or damage caused to
another party, that is, ‘insured’.
• The insured must pay a definite amount called as
‘premium’.

11. Principles of Insurance
a) Insurable Interest:
• The person getting an insurance policy must have an insurable interest in the property or life
insured.
• If it is not present, then the insurance contract becomes wagering contract which is not valid
and cannot be enforced in the court of law.
b) Utmost Good Faith:
• The party proposing to take the insurance policy has to disclose all the material facts
relevant to the contract to the insurer; otherwise, it lacks good faith and leads to invalidation
of contract.

12. c) Indemnity:
• It refers to make good the loss and nothing more than the actual loss.
• This principle is applied to all the insurance contracts where the loss suffered by the
insured can be measured.
• Therefore, all the contracts of insurance except life insurance, are the contracts of
indemnity.
d) Proximate Cause:
• It is also called ‘principle of causa proxima’ which means nearest or immediate cause.
• This principle is useful in deciding the actual cause of loss when several causes have
contributed for the occurrence or loss.
• It is widely used in marine insurance.

13. e) Subrogation:
• It refers to substitution.
• It is the transfer of rights and remedies of the insured in the
subject matter to the insurer after the indemnification.
f) Contribution:
• This principle ensures equitable distribution of losses
among the insurers.
g) Mitigation of Loss:
• It is related to minimizing the severity of the loss. It is the
duty of insured to take all such precautions to minimize the
loss.

14. Functions of Insurance
• Insurance provides certainty of payment for the risk
of loss. The insurer charges premium for providing
the certainty.
• It provides protection from probable chances of
loss. It may not stop the happening of risk, but can
compensate for losses arising out of it.
• On the happening of a risk event, the loss is shared
by all the persons exposed to it. The share is
obtained from every insured member by way of
premiums.
• The premiums received are invested in various
income generating schemes.

15. Benefits of Insurance
a) Provides certainty
b) Distribution of losses
c) Provides security
d) Generates capital
e) Increases efficiency
f) Social security

16. Costs (disadvantages) of Insurance
i) Sharing of loss: The loss of one person should be shared by all
other policyholders.
ii) Real value of money: The maturity value of policy after the specific
period may be more, but the real value of money is going to be loss.
iii) Lack of confidence: Many of the investors, who propose to save
their money, prefer banks and other financial institutions. It may be
due to lack of confidence in the insurance companies and its policies.

17. Life Insurance -
Meaning
• Life insurance refers to a contract whereby
the insurer, in consideration of a premium
paid either in lump sum or in periodical
instalments, undertakes to pay an annuity
of a certain sum of money either on the
death of the insured or on the expiry of a
certain number of years.

18. Types of Life Insurance Policies
i. Whole life policy: It runs throughout the lifetime of the
policy holder. Premium is low and covers high risk.
ii. Endowment life assurance policy: This policy is taken
for a specific period. It will mature at the expiry of a
specific period or attainment of particular age or on the
death of the insured whichever is earlier.
iii. Joint life policy: A policy may be taken up jointly on the
lives of two or more persons. On the death of any one
person, the policy is paid to the other survivor.

19. iv. Annuity policy: Under this policy, the insured would
deposit a lump sum amount with the insurance company. The
amount of the policy would be paid to the insured for a
specified number of years, or until the death of the assured.
v. Children’s endowment policy: This policy is taken by a
person for his/her children to meet the expenses of their
education or marriage. The agreement states that a certain
sum will be paid by the insurer when the children attain a
particular age.

20. Advantages of Life Insurance Policies
a) Encourages savings habit
b) Policy can be assigned or mortgaged
c) Tax benefits
d) Protection to family members
e) Best source of investment
f) Provides social security

21. Marine Insurance
• It is an arrangement by which the insurance
company agrees to indemnify the owner of
the ship or cargo against the risks involved
in marine cargo and ship.

22. Characteristics (features) of a Marine Insurance
• Marine insurance must have the fundamentals of general contract
i.e. insurable interest, utmost good faith, indemnity, subrogation,
contribution, causa proxima, etc.
• It is a contract between the insured and insurer.
• In marine insurance, cargo, ship or its freight can be insured. It
covers many risks such as sinking of the ship, burning of the ship,
collision of ships, etc.
• The insurers guarantee to indemnify the losses caused by sea
risks only.
• The insured is compensated only when the loss is occurred to the
ship or cargo.

23. Fire Insurance
• It is an agreement between the insurers and the
insured whereby the insurers having received
premium, undertake to make good the financial
loss to the extent of specified amount, suffered
by the insured as a result of fire accident.

24. Features of
Fire Insurance
• The fire insurance contract is a contract of
indemnity and the insured cannot claim more
than the value of goods lost or damaged by fire
or the amount of policy whichever is less.
• There must be consideration (Premium) in fire
insurance contract.
• The insured must have insurable interest at the
time of taking the policy and also at the time
when the loss occurs and claims for
compensation.

25. • The right over the scrap or the damaged goods
after providing the compensation will pass on
to the insurer.
• The loss must be the outcome of fire and no
other reason for loss of property is accepted for
settlement of claim.

26. Thank you for your attention