ST.

GONSALO GARCIA COLLeGE

PROJECT ON:
LIFE INSURANCE CORPORATION OF INDIA SUB: INSURANCE FUND
MANAGEMENT

SUBMITTE D TO:
MISS SWEEDAL
MEMBERS

ROLL NOS. 02 03 12 41 43

NAMES MANOJ MUKESH ALBINUS DELSON SHREERA J

HARD COPY

PRESENTATI ON

INDEX
SR. NO
1 2 3 4 5 6 7 8 9 10

PARTICULARS
Introduction to Insurance Introduction to LIC The other subsidiaries companies under LIC History Of Insurance Objectives of LIC IRDA Products of Company Payment of Cash Counter Types of LIC Policies Conclusion

Introduction to Insurance
In law and economics, insurance is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. Insurance is defined as the equitable transfer of the risk of a loss, from one entity to another, in exchange for payment. An insurer is a company selling the insurance; an insured or policyholder is the person or entity buying the insurance policy. The insurance rate is a factor used to determine the amount to be charged for a certain amount of insurance coverage, called the premium. Risk management, the practice of appraising and controlling risk, has evolved as a -discrete field of study and practice. The transaction involves the insured assuming a guaranteed and known relatively small loss in the form of payment to the insurer in exchange for the insurer's promise to compensate (indemnify) the insured in the case of a large, possibly devastating loss. The insured receives a contract called the insurance policy which details the conditions and circumstances under which the insured will be compensated.

Introduction to LIC

The Life Insurance Corporation (LIC) of India founded in 1956 is the largest life insurance company in India owned solely by the Government of India. Headquartered in Mumbai, which is considered the financial capital of India, LIC presently has 7 Zonal Offices and 100 Divisional Offices situated all around the country. In addition to an even distribution of 2048 branches located in different towns and cities of India, LIC also has a network of around one million agents who solicit life insurance policies to the public.

The other subsidiary companies under LIC are:

Life Insurance Corporation (LIC) of India International - A joint venture offshore company promoted by LIC which commenced its operations in July, 1989 with the objective of offering policies denominated in US $ to NRIs residing in the Gulf. LIC Nepal - Formed in 2001 in joint venture with Vishal Group of Industries, Nepal. LIC Lanka - Formed in 2003 in joint venture with Bartleet Group of Companies, Sri Lanka LIC Housing Finance - Established in 19 Th June, 1989 in Dubai with the objective of providing long term finance for construction of houses or apartments. LIC Housing Finance Limited Care Homes - A wholly owned subsidiary of LIC Housing Finance which builds "Assisted Community Living Centers" for senior citizens.

History of Insurance
Life Insurance in its modern form came to India from England in the year 1818. Oriental Life Insurance Company started by Europeans in Calcutta was the first life insurance company on Indian Soil. All the insurance companies established during that period were brought up with the purpose of looking after the needs of European community and Indian natives were not being insured by these companies. However, later with the efforts of eminent people like Babu Muttylal Seal, the foreign life insurance companies started insuring Indian lives. But Indian lives were being treated

as sub-standard lives and heavy extra premiums were being charged on them. Bombay Mutual Life Assurance Society heralded the birth of first Indian life insurance company in the year 1870.

Insurance Regulatory and Development Authority IRDA

IRDA was set up by the parliament in 1999. The section 4 of IRDA Act' 1999, Insurance Regulatory and Development Authority specify the composition of Authority

The Authority is a ten-member team consisting of a. Chairman; b. five whole-time members; c. four part-time members, all these positions are appointed by the Government of India IRDA - Duties, Powers and Functions Section 14 of IRDA Act, 1999 lays down the duties, powers and functions of IRDA..(1) Subject to the provisions of this Act and any other law for the time being in force, the Authority shall have the duty to regulate, promote and ensure orderly growth of the insurance business and re-insurance business.

OBJECTIVES OF LIC

Spread Life Insurance widely and in particular to the rural areas and to the socially and economically backward classes with a view to reaching all insurable persons in the country and providing them adequate financial cover against death at a reasonable cost. Maximize mobilization of people's savings by making insurance-linked savings adequately attractive. Bear in mind, in the investment of funds, the primary obligation to its policyholders, whose money it holds in trust, without losing sight of the interest of the community as a whole; the funds to be deployed to the best advantage of the investors as well as the community as a whole,

keeping in view national priorities and obligations of attractive return.

Conduct business with utmost economy and with the full realization that the moneys belong to the policyholders. Act as trustees of the insured public in their individual and collective capacities. Meet the various life insurance needs of the community that would arise in the changing social and economic environment. Involve all people working in the Corporation to the best of their capability in furthering the interests of the insured public by providing efficient service with courtesy. Promote amongst all agents and employees of the Corporation a sense of participation, pride and job satisfaction through discharge of their duties with dedication towards achievement of Corporate Objective. Divisions of lic.

PAYMENT AT CASH COUNTER AT CASH COUNTER

Premium can be paid at the cash counter of any LIC Branch Office. Premium can be paid by CASH/CHEQUE/DD. Premium for ULIP policies can now be paid at any LIC Branch cash counter across the country Through collection center as followed by flow chart as given

Types of Policy Jeevan saathi

Product summary :

This is an Endowment Assurance Plan issued on the lives of husband and wife. The plan provides financial protection against death of both the lives. It pays the maturity amount on survival of one or both the lives to the end of the policy term. Premiums : Premiums are payable yearly, half-yearly, quarterly, monthly or through salary deductions as opted by you throughout the term of the policy or till the first death of the lives covered, whichever is earlier. Bonuses: This is a with-profit plan and participates in the profits of the Corporations life insurance business. It gets a share of the profits in the form of bonuses. Simple Reversionary Bonuses are declared per thousand Sum Assured annually at the end of each financial year. Once declared, they form part of the guaranteed benefits of the plan. Such bonuses are to be added till date of maturity or the second death of the lives covered, whichever is earlier. Final (Additional) Bonus may also be payable provided policy has run for certain minimum period.

Death Benefit : On first death the Sum assured is payable in a lump sum. If the survivor of the two lives dies thereafter during the remaining policy term, Sum Assured along with the all bonuses is payable again in a lump sum.

Maturity Benefit : If one or both the lives survive till the end of the policy term, Sum Assured along with all bonuses declared up to maturity date is payable in a lump sum.

Supplementary/Extra Benefits : These are the optional benefits that can be added to your basic plan for extra protection/option. An additional premium is required to be paid for these benefits. Survival benefits: If one or both the lives survive to the maturity date, the sum assured, along with the accumulated bonus, is payable. Death Benefits:

In case either of the couple dies during the policys term, two things happen. One, LIC pays to the surviving spouse the full sum assured. And, two, the policy continues on the life of the surviving partner without him/her having to pay any further premiums, i.e. the life cover on the survivor continues free of cost. The sum assured is again be payable on the death of the other partner in case both the husband and wife were to die during the term of the policy. Vested bonus would also be paid along with the sum assured on the second death. Surrender Value : Buying a life insurance contract is a long-term commitment. However, surrender values are available under the plan on earlier termination of the contract. Guaranteed Surrender Value : The policy may be surrendered after it has been in force for 3 years or more. The guaranteed surrender value is 30% of the basic premiums paid excluding the first years premium. Corporations policy on surrenders : In practice, the Corporation will pay a Special Surrender Value which is either equal to or more than the Guaranteed Surrender Value. The benefit payable on surrender is the discounted value of the reduced claim amount that would be payable on death or at maturity. This value will depend on the duration for which premiums have been paid and the policy duration at the date of surrender. In some circumstances, in case of early termination of the policy, the surrender value payable may be less than the total premiums paid. The Corporation reviews the surrender value payable under its plans from time to time depending on the economic environment, experience and other factors.

BENEFIT ILLUSTRATION
Statutory warning :

Some benefits are guaranteed and some benefits are variable with returns based on the future performance of your insurer carrying on life insurance business. If your policy offers guaranteed returns then these will be clearly marked guaranteed in the illustration table on this page. If your policy offers variable returns then the illustrations on this page will show two different rates of assumed future investment returns. These assumed rates of return are not guaranteed and they are not the upper or lower limits of what you might get back as the value of your policy is dependent on a number of factors including future investment performance.

Jeevan pramukh
FEATURES
This exclusive policy for people with an exclusive lifestyle. Whether youre a professional, industrialist, estate owner, NRI, film star, or an individual successful in your own area of work. This is a policy that offers insurance protection match your profile. Life insurance cover continues for a longer term even after premium paying term. Apart from the basic Sum Assured payable at maturity or death, the policy also provides for a guaranteed addition at the rate of Rs.50/- per thousand Sum Assured per year for first 5 years and reversionary bonus thereafter. This is an Endowment (limited payment) plan with Guaranteed Addition and with wide options to select premium paying terms as follows Policy Term (in yrs) 5 10 15 20 25 Premium paying term(in yrs) 1,2 or 3 1, 2, 3, 4 or 6 1, 2, 3, 4, 6, 8 or 10 1, 2, 3, 4, 6, 8, 10 or 12 1, 2, 3, 4, 6, 8, 10, 12 or 16

BENEFITS
Insurance Regulatory & Development Authority (IRDA) requires all life insurance companies operating in India to provide official illustrations to their customers. The illustrations are based on the investment rates of return set by the Life Insurance Council (constituted under Section 64C(a) of the Insurance Act 1938) and is not intended to reflect the actual investment returns achieved or may be achieved in future by Life Insurance Corporation of India (LICI). For the year 2004-05 the two rates of investment return declared by the Life Insurance Council are 6% and 10% per annum.

Product summary : This is an Endowment Assurance plan offering the choice of three premium paying terms. It provides financial protection against death throughout the term of the plan with the payment of maturity amount on survival to the end of the policy term. Premiums : Premiums are payable yearly, half-yearly, quarterly or monthly, as opted by you, throughout the premium paying term or till earlier death Death Benefit : The Sum Assured along with accrued guaranteed additions and vested simple reversionary bonuses and Terminal Bonus, if any, is payable in a lump sum on death of the life assured during the policy term. Maturity Benefit: The Sum Assured along with accrued guaranteed additions and vested simple reversionary bonuses and Terminal Bonus, if any, is payable in a lump sum on survival to the end of the policy term. Payment of premium : Premiums under this policy are payable over a period of 3, 4 or 5 years. The following modes of payment of premium are allowed - Yearly, Half-yearly, quarterly or monthly. Policy Term: 5, 10, 15, 20 or 25 years.

Whole Life Policy

Features
As the name says Whole Life Policy which means will continue until you are alive
This is the best form of life assurance for family provision since it enables the Life Assured to pay all the premiums during the ordinarily vigorous and most productive years of life. He need not pay any premium in the later stages of life if and when his conditions might become adverse. With Profits Limited Payments Policies do not cease to participate in profits after completion of the premium paying period but continue to share in the periodical Bonus Distribution until the death of the Life Assured.The Without-Profit option is available under Table no. 3. If the policyholder pays at least 3 years' premiums and then discontinues paying any more premium, a reduced paid-up assurance policy comes into force. Such a reduced paid-up Policy will

not be entitled to participate in the profits declared thereafter, but such Bonus as has already been declared on the Policy will remain attached thereto. The premium paying term under this plan is five years minimum and 55 years maximum. Source - Life Insurance India, Lic India. If life insurance buying is approached in the proper manner it can be very beneficial to yourself and your family. You need to take the time to give some thought to a subject that can be very unpleasant. I guess that is why most people don't think about it, or at best think about it only after they have had a brush with death, or when a life insurance professional brings up the subject. Sometimes these people wait until it is too late to do something about such a critical matter. They find themselves uninsurable when they discover they have some critical illness. People should give life insurance buying serious thought at least once per year as ones situation may change and you find that your need for life insurance may change as a result.

Child career plan

FEATURES
Introduction: This plan is specially designed to meet the increasing educational and other needs of growing children. It provides the risk cover on the life of child not only during the policy term but also during the extended term (i.e. 7 years after the expiry of policy term). A number of Survival benefits are payable on surviving by the life assured to the end of the specified durations. Options: You may choose Sum Assured (S.A.), Maturity Age, Policy Term, Mode of Premium payment and Premium Waiver Benefit. Payment of Premiums: You may pay the premiums regularly at yearly, half-yearly, quarterly or through Salary deductions over the term of policy. Premiums may be paid either for 6 years or upto 5 years before the policy term.

Jeevan Anurag Endowment Vesting At 21 Endowment Vesting At 18 Jeevan Kishore Child Career Plan

Komal Jeevan Marriage Endowment Or Educational Annuity Plan Jeevan Chhaya Child Future Plan

Jeevan saral
This is an Endowment Assurance plan where the proposer has simply to choose the amount and mode of premium payment. The plan provides financial protection against death throughout the term of the plan. The death benefit is directly related to the premiums paid. The Maturity Sum Assured depends on the age at entry of the life to be assured and is payable on survival to the end of the policy term. It also offers the flexibility of term and a lot of liquidity. Premiums: Premiums are payable yearly, half-yearly, quarterly, or monthly through salary deductions as opted by you throughout the term of the policy or till earlier death. Loyalty Additions: This is a with-profits plan and participates in the profits of the Corporations life insurance business. It gets a share of the profits in the form of loyalty additions which are terminal bonuses payable along with death benefit or maturity benefit. Loyalty Additions may be payable from the 10th year onwards depending upon the experience of the Corporation Death Benefit: 250 times the monthly premium together with loyalty additions, if any, and return of premiums excluding first year premiums and extra/rider premium, if any, is payable in lump sum on death of the life assured during the term of the policy.

Maturity Benefit: The Maturity Sum Assured plus Loyalty additions, if any, is payable in a lump sum.

Conclusion
Thus we came to know that till today according to 2010 data only 25% of the Indian economy is insured and only 3% of the total investment goes in to insurance sector life insurance is one of the fastest going insurance industry in India. Thus it is one of the safe and secure investment without risk and have a good return on it there are various policies as explained for various group n individual which suits their requirement.