Final Project 200 Marks

INTRODUCTION TO LIFE INSURANCE

DEFINITION

Definition of life Insurance: ‘Life insurance is a contract between two parties

whereby one party agrees to pay to the other party, a certain amount of

money as premium to make good the loss of life arising out of an uncertain

event of death in which the insured has interest.‘

BASICS OF LIFE INSURANCE

What Is Life Insurance?

Life insurance offers a way to replace the loss of income that occurs when

someone dies (usually the person who produces the majority of income in a

family situation). It is a contract between you as the insured person and the

company or "carrier" that is providing the insurance. If you die while the

contract is in force, the insurance company pays a specified sum of money

free of income tax — "cash benefits" — to the person or persons you name as

beneficiaries.

A good life insurance program does more than just replace the loss of income

that occurs if you die. It should also provide money to cover the new costs

that arise after your death —funeral expenses, taxes, probate costs, the need

for housekeepers and child care, and so on. And these cash benefits should

provide for your family's future needs as well, including college education for

your children and part or all of your spouse's retirement needs. In almost all

cases, your beneficiary can use the cash benefits in the way he or she sees

fit, without restriction.

Some types of life insurance — permanent life insurance policies — have a

cash value that you can obtain by cashing out the policy or by borrowing

against it. Though it can seem attractive, most financial experts agree that this

feature should be seen as a secondary purpose of life insurance. Another

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type of insurance is term life insurance policies are available as well. To learn

more click the respected link.

Do You Really Need Life Insurance?

If there is someone who would suffer economic hardship if you died, then the

answer is yes... you need life insurance!  Families with young children have a

clear need for life insurance. If both spouses work, the loss of one income will

cause the family immediate economic hardship and make it harder for them to

realize future goals, such as paying for the children's' education. But even if

one spouse works "inside the home" and doesn't bring in a formal income, his

or her death will require the surviving spouse to hire child care, housekeepers

and other professionals to help run the household - and that can be a

significant new expense.

If you are married without children or single, then you may need life insurance

to protect your partner or surviving family members against the costs

associated with your death.  Funeral expenses, probate and administrative

fees, outstanding debts, special obligations to charities, and federal and state

taxes are costs that all of us must consider.  And, they can add up quickly.

Unless you already have sufficient financial resources, your survivors will

probably need life insurance to cover these expenses.

What Happens To Your Family If You Don't Have Enough Coverage?

Under any circumstances, the loss of a loved one is a traumatic experience. 

But, if your family is also left without sufficient money to meet basic living

needs or prepare for future goals, they will have to cope with a financial crisis

at the same time. Depending upon their current financial resources and ability

to "get back on their feet" emotionally and financially, your family might be

forced to move to a less desirable home or community, abandon education

and career plans, reorder family priorities (such as the amount of time spent

with the children) and, in general, cut back on the quality of life you have

worked hard to achieve.

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Your family might even be forced to go into debt simply to pay the expenses,

like funeral costs, taxes, and medical bills, that result from your death.  A

moment's reflection will tell you that the lack of sufficient life insurance

coverage when a loved one dies can have devastating consequences for a

family...consequences that can last for years.

HISTORY OF LIFE INSURANCE

The story of insurance is probably as old as the story of mankind. The same

instinct that prompts modern businessmen today to secure themselves

against loss and disaster existed in primitive men also. They too sought to

avert the evil consequences of fire and flood and loss of life and were willing

to make some sort of sacrifice in order to achieve security. Though the

concept of insurance is largely a development of the recent past, particularly

after the industrial era – past few centuries – yet its beginnings date back

almost 6000 years.

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, and covered Indian lives at normal

rates. Starting as Indian enterprise with highly patriotic motives, insurance

companies came into existence to carry the message of insurance and

social security through insurance to various sectors of society. Bharat

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Insurance Company (1896) was also one of such companies inspired by

nationalism. The Swadeshi movement of 1905-1907 gave rise to more

insurance companies. The 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, house of the

great poet Rabindranath Tagore, in Calcutta. The Indian Mercantile, General

Assurance and Swadeshi Life (later Bombay Life) were some of the

companies established during the same period. Prior to 1912 India had no

legislation to regulate insurance business. In the year 1912, the Life

Insurance Companies Act, and the Provident Fund Act were passed. The

Life Insurance Companies Act, 1912 made it necessary that the premium

rate tables and periodical valuations of companies should be certified by an

actuary. But the Act discriminated between foreign and Indian companies on

many accounts, putting the Indian companies at a disadvantage.

The first two decades of the twentieth century saw lot of growth in insurance

business. From 44 companies with total business-in-force as Rs.22.44 crore,

it rose to 176 companies with total business-in-force as Rs.298 crore in

1938. During the mushrooming of insurance companies many financially

unsound concerns were also floated which failed miserably. The Insurance

Act 1938 was the first legislation governing not only life insurance but also

non-life insurance to provide strict state control over insurance business.

The demand for nationalization of life insurance industry was made

repeatedly in the past but it gathered momentum in 1944 when a bill to

amend the Life Insurance Act 1938 was introduced in the Legislative

Assembly. However, it was much later on the 19th of January, 1956, that life

insurance in India was nationalized. About 154 Indian insurance companies,

16 non-Indian companies and 75 provident were operating in India at the

time of nationalization. Nationalization was accomplished in two stages;

initially the management of the companies was taken over by means of an

Ordinance, and later, the ownership too by means of a comprehensive bill.

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The Parliament of India passed the Life Insurance Corporation Act on the

19th of June 1956, and the Life Insurance Corporation of India was created

on 1st September, 1956, with the objective of spreading life insurance much

more widely and in particular to the rural areas with a view to reach all

insurable persons in the country, providing them adequate financial cover at

a reasonable cost.

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INDIA INSURANCE POLICY

Insurance Policy India provides the clients with the details required for the

coverage’s in the policy, date of commencement of the policy and their

adopting organizations. It plays an important role in the Indian insurance

sector. 

The Insurance Policy India is regulated by certain acts like the Insurance Act

(1938), the Life Insurance Corporation Act (1956), General Insurance

Business (Nationalization) Act (1972), Insurance Regulatory and

Development Authority (IRDA) Act (1999). The insurance policy determines

the covers against risks, sometime opens investment options with insurance

companies setting high returns and also informs about the tax benefits like the

LIC in India. There are two types of insurance covers: 

1. Life insurance 

2. General insurance

Life insurance – this sector deals with the risks and the accidents affecting the

life of the customer. Alongside, this insurance policy also offers tax planning

and investment returns. There are various types of life Insurance Policy India: 

a. Endowment Policy 

b. Whole Life Policy 

c. Term Life Policy 

d. Money-back Policy 

e. Joint Life Policy 

f. Group Insurance Policy 

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g. Loan Cover Term Assurance Policy 

h. Pension Plan or Annuities 

i. Unit Linked Insurance Plan 

General Insurance – this sector covers almost everything related to property,

vehicle, cash, household goods, health and also one's liability towards others.

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TYPES OF LIFE INSURANCE

Term Insurance Policy

Whole Life Policy

Endowment Policy

Money Back Policy

Annuities and Pension

Most of the products offered by Indian life insurers are developed and

structured around these "basic" policies and are usually an extension or a

combination of these policies. So, what are these policies and how do they

differ from each other.

Life insurance may be divided into two basic classes – temporary and

permanent or following subclasses - term, universal, whole life and

endowment life insurance.

Term Insurance

Term assurance provides life insurance coverage for a specified term of years

in exchange for a specified premium. The policy does not accumulate cash

value. Term is generally considered "pure" insurance, where the premium

buys protection in the event of death and nothing else.

Various insurance companies sell term insurance with many different

combinations of these three parameters. The face amount can remain

constant or decline. The term can be for one or more years. The premium can

remain level or increase. Common types of term insurance include Level,

Annual Renewable and Mortgage insurance.

Level Term policy has the premium fixed for a period of time longer than a

year. These terms are commonly 5, 10, 15, 20, 25, 30 and even 35 years.

Level term is often used for long term planning and asset management

because premiums remain consistent year to year and can be budgeted long

term. At the end of the term, some policies contain a renewal or conversion

option. Guaranteed Renewal, the insurance company guarantees it will issue

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a policy of equal or lesser amount without regard to the insurability of the

insured and with a premium set for the insured's age at that time. Some

companies however do not guarantee renewal, and require proof of

insurability to mitigate their risk and decline renewing higher risk clients (for

instance those that may be terminal). Renewal that requires proof of

insurability often includes a conversion options that allows the insured to

convert the term program to a permanent one that the insurance company

makes available. This can force clients into a more expensive permanent

program because of anti selection if they need to continue coverage. Renewal

and conversion options can be very important when selecting a program.

Annual renewable term is a one year policy but the insurance company

guarantees it will issue a policy of equal or lesser amount without regard to

the insurability of the insured and with a premium set for the insured's age at

that time.

Another common type of term insurance is mortgage insurance, which is

usually a level premium, declining face value policy. The face amount is

intended to equal the amount of the mortgage on the policy owner’s residence

so the mortgage will be paid if the insured dies.

A policy holder insures his life for a specified term. If he dies before that

specified term is up (with the exception of suicide see below), his estate or

named beneficiary receives a payout. If he does not die before the term is up,

he receives nothing. However, in some European countries (notably Serbia),

insurance policy is such that the policy holder receives the amount he has

insured himself to, or the amount he has paid to the insurance company in the

past years. Suicide used to be excluded from ALL insurance policies[when?],

however, after a number of court judgments against the industry, payouts do

occur on death by suicide (presumably except for in the unlikely case that it

can be shown that the suicide was just to benefit from the policy). Generally, if

an insured person commits suicide within the first two policy years, the insurer

will return the premiums paid. However, a death benefit will usually be paid if

the suicide occurs after the two year period.

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Permanent Life Insurance

Permanent life insurance is life insurance that remains in force (in-line) until

the policy matures (pays out), unless the owner fails to pay the premium when

due (the policy expires OR policies lapse). The policy cannot be canceled by

the insurer for any reason except fraud in the application, and that

cancellation must occur within a period of time defined by law (usually two

years). Permanent insurance builds a cash value that reduces the amount at

risk to the insurance company and thus the insurance expense over time. This

means that a policy with a million dollar face value can be relatively expensive

to a 70 year old. The owner can access the money in the cash value by

withdrawing money, borrowing the cash value, or surrendering the policy and

receiving the surrender value.

The four basic types of permanent insurance are whole life, universal

life, limited pay and endowment.

Whole life coverage

Whole life insurance provides for a level premium, and a cash value table

included in the policy guaranteed by the company. The primary advantages of

whole life are guaranteed death benefits, guaranteed cash values, fixed and

known annual premiums, and mortality and expense charges will not reduce

the cash value shown in the policy. The primary disadvantages of whole life

are premium inflexibility, and the internal rate of return in the policy may not

be competitive with other savings alternatives. Also, the cash values are

generally kept by the insurance company at the time of death, the death

benefit only to the beneficiaries. Riders are available that can allow one to

increase the death benefit by paying additional premium. The death benefit

can also be increased through the use of policy dividends. Dividends cannot

be guaranteed and may be higher or lower than historical rates over time.

Premiums are much higher than term insurance in the short-term, but

cumulative premiums are roughly equal if policies are kept in force until

average life expectancy.

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Cash value can be accessed at any time through policy "loans" and are

received "income-tax free". Since these loans decrease the death benefit if

not paid back, payback is optional. Cash values support the death benefit so

only the death benefit is paid out.

Dividends can be utilized in many ways. First, if Paid up additions is elected,

dividend cash values will purchase additional death benefit which will increase

the death benefit of the policy to the named beneficiary. Another alternative is

to opt in for 'reduced premiums' on some policies. This reduces the owed

premiums by the unguaranteed dividends amount. A third option allows the

owner to take the dividends as they are paid out. (Although some policies

provide other/different/less options than these - it depends on the company for

some cases)

Universal life coverage

Universal life insurance (UL) is a relatively new insurance product intended to

provide permanent insurance coverage with greater flexibility in premium

payment and the potential for a higher internal rate of return. There are

several types of universal life insurance policies which include "interest

sensitive" (also known as "traditional fixed universal life insurance"), variable

universal life insurance, and equity indexed universal life insurance.

A universal life insurance policy includes a cash account but the cash

decreases over time. Premiums increase the cash account, but, the cost of

interest increases each year so the cash deteriorates over time. Interest is

paid within the policy (credited) on the account at a rate specified by the

company, but then mortality charges and administrative costs are then

charged against (reduce) the cash account. The surrender value of the policy

is the amount remaining in the cash account less applicable surrender

charges, if any. Universal Life does not work in a recession or low interest rate

environment.

With all life insurance, there are basically two functions that make it work.

There's a mortality function and a cash function. The mortality function would

be the classical notion of pooling risk where the premiums paid by everybody

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else would cover the death benefit for the one or two who will die for a given

period of time. The cash function inherent in all life insurance says that if a

person is to reach age 95 to 100 (the age varies depending on state and

company), then the policy matures and endows the face value of the policy.

Actuarially, it is reasoned that out of a group of 1000 people, if even 10 of

them live to age 95, then the mortality function alone will not be able to cover

the cash function. So in order to cover the cash function, a minimum rate of

investment return on the premiums will be required in the event that a policy

matures.

Universal life insurance addresses the perceived disadvantages of whole life.

Premiums are flexible. Depending on how interest is credited, the internal rate

of return can be higher because it moves with prevailing interest rates

(interest-sensitive) or the financial markets (Equity Indexed Universal Life and

Variable Universal Life). Mortality costs and administrative charges are

known. And cash value may be considered more easily attainable because

the owner can discontinue premiums if the cash value allows it. And universal

life has a more flexible death benefit because the owner can select one of two

death benefit options, Option A and Option B.

Option A pays the face amount at death as it's designed to have the cash

value equal the death benefit at maturity (usually at age 95 or 100). With each

premium payment, the policy owner is reducing the cost of insurance until the

cash value reaches the face amount upon maturity. But, it does not perform

like a whole life policy when each year the costs increase and never stop. In

whole life, the costs are complete within the first few years of the policy.

Option B pays the face amount plus the cash value, as it's designed to

increase the net death benefit as cash values accumulate. Option B offers the

benefit of an increasing death benefit every year that the policy stays in force.

The drawback to option B is that because the cash value is accumulated "on

top of" the death benefit, the cost of insurance never decreases as premium

payments are made. Thus, as the insured gets older, the policy owner is

faced with an ever increasing cost of insurance (it costs more money to

provide the same initial face amount of insurance as the insured gets older).

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Limited-pay

Another type of permanent insurance is Limited-pay life insurance, in which all

the premiums are paid over a specified period after which no additional

premiums are due to keep the policy in force. Common limited pay periods

include 10-year, 20-year, and paid-up at age 65.

Endowments

Endowments are policies in which the cash value built up inside the policy,

equals the death benefit (face amount) at a certain age. The age this

commences is known as the endowment age. Endowments are considerably

more expensive (in terms of annual premiums) than either whole life or

universal life because the premium paying period is shortened and the

endowment date is earlier.

Endowment Insurance is paid out whether the insured lives or dies, after a

specific period (e.g. 15 years) or a specific age (e.g. 65).

Accidental Death

Accidental death is a limited life insurance that is designed to cover the

insured when they pass away due to an accident. Accidents include anything

from an injury, but do not typically cover any deaths resulting from health

problems or suicide. Because they only cover accidents, these policies are

much less expensive than other life insurances.

It is also very commonly offered as "accidental death and dismemberment

insurance", also known as an AD&D policy. In an AD&D policy, benefits are

available not only for accidental death, but also for loss of limbs or bodily

functions such as sight and hearing, etc.

Accidental death and AD&D policies very rarely pay a benefit; either the

cause of death is not covered, or the coverage is not maintained after the

accident until death occurs. To be aware of what coverage they have, an

insured should always review their policy for what it covers and what it

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excludes. Often, it does not cover an insured who puts themselves at risk in

activities such as: parachuting, flying an airplane, professional sports, or

involvement in a war (military or not)..

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NEED OF LIFE INSURANCE:

The original basic intention of life insurance is to provide for one’ family and

perhaps others in the event of death. Originally, polices were to provide for

short periods of time, covering temporary risk situations, such as sea

voyages. As life insurance became more established. It was realized what a

useful tool it was in a number of situations, including:

Temporary needs threats:

The original purpose of Life Insurance remains an important element, namely

providing for replacement of income on death etc.

Regular saving :

Providing one’s family and oneself, as a medium to long term exercise

(through a series of regular payment of premiums). This has been become

more relevant in recent times as people seek financial independence from

their family.

Investment :

Put simply, the building up of saving while safeguarding it from ravages of

inflation. Unlike regular saving products are traditionally lump is investments,

where the individual makes are one time payment.

Retirement:

Provision for one’s on later years has become increasingly necessary.

Especially in charging culture abs social environment, one can buy a suitable

insurance policy which will provide periodical payments on one’s old age.

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BENEFITS OF LIFE INSURANCE:

It is superior to traditional saving machine .

As well as providing a secure vehicle to build up saving etc. it provides pieced

of mind to the policy holder. In the event ultimately death, of say, the main

earner in the family, the policy will pay out guaranteed sum assured, which is

likely to be significantly more then the total premiums paid. With more

traditional, saving vehicles such as fixed deposits, the only return would be

the amount invested plus any interested accrued.

It encourages saving and forces thrift .

Once an insurance contract has been entered into, the insured has an

obligation to continue paying premiums, until the end of the term of policy,

otherwise the policy will lapse.

It provides easy settlement and protection against creditors

Once a person appointed for receiving the benefits or a transfer of rights is

made (assignments), a claim under the life insurance contracts can be settled

easily.

It can be enchased and facilities borrowing .

Sum contracts may allow the policy can be surrendered for a cash amount, if

policy holder is not in a position to pay the premium. A loan, against certain

policy, can be taken for a temporary period to tide over the difficulty. Presence

of life insurance policy facilitates credit for personal or commercial loans as it

can be offered as collateral security.

Tax relief :

The policy holder obtains income tax rebates by paying the insurance

premium. The specified from of saving which enjoys a tax rebate u/s 88 of the

income tax act. Include Life Insurance premiums and contribution to a

recognized PF etc.

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TIPS FOR CHOOSING LIFE INSURANCE POLICY

While selecting the right insurance cover, one should always consider her/his

present earnings and the estimated competence to forfeit the insurance

premiums at the allotted dates besides the age factor, future fiscal strategies,

medical condition, etc.

Other factors which needs to be taken into consideration while selecting the

right insurance policy are the policy's cost-benefit ratio and guaranteeing that

the insurance envelops all your family members along with the common

health issues.The cost benefit ratio of the insurance policy relies on many

factors such as what is insured and what are the benefits that come along

with it.

Hence while purchasing the policy one needs to keep a strict vigilance on the

price of the policy and guaranteeing that the policy rationalizes the benefits

included under it.

Besides keeping a close eye on the advantages, the policyholder should also

ensure that the promises made by various insurance firms are adhered by.

The different types of covers that people generally prefer are:

Pure Term Insurance: Pure Term Life Insurance offers insurance cover for life

for certain period of time. However, the cover offers no maturity advantages

but on the demise of the assured, the total amount insured is completely

forfeited to the next of the kin. 

Endowment Policy: A life insurance agreement structured to forfeit the total

amount after a certain maturity period or on the event of the assured demise

is known as an endowment policy. The policy offers fiscal safety for a

specified tenure. The purchaser forfeits sporadic premiums for a specific

tenure and continues to stay protected for that particular tenure. If the

policyholder stays alive till the conclusion of the tenure, he is entitled to

receive the fund balance. 

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Unit Linked Insurance Plan (ULIP): ULIP offers life cover in which the policy

cost differs from time to time depending on the price of the principal assets at

the given point of time. 

Money-back Policy: Money-back Policy is the alteration of endowment plan.

The basic difference lies in the maturity advantages that are forfeited by the

bank at the end of endowment tenures. Money back policies offer cyclic

imbursements of partly continued existence benefits during the tenure of the

cover.

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COMPARITIVE STUDY BETWEEN PUBLIC AND PRIVATE

SECTOR

INTRODUCTION

Insurance is an upcoming sector, in India the year 2000 was a landmark year

for life insurance industry, in this year the life insurance industry was

liberalized after more than fifty years.

Insurance sector was once a monopoly, with LIC as the only company, a

public sector enterprise. But nowadays the market opened up and there are

many private players competing in the market. There are fifteen private life

insurance companies has entered the industry.

After the entry of these private players, the market share of LIC has been

considerably reduced. In the last five years the private players is able to

expand the

market (growing at 30% per annum) and also has improved their market

share to 18%. For the past five years private players have launched many

innovations in the industry in terms of products, market channels and

advertisement of products, agent training and customer services etc.

LIST OF INSURANCE COMPANY IN INDIA

LIFE INSURERS Websites

Public Sector

Life Insurance Corporation of India www.licindia.com

Private Sector

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Allianz Bajaj Life Insurance Company

Limitedwww.allianzbajaj.co.in

Birla Sun-Life Insurance Company Limited www.birlasunlife.com

HDFC Standard Life Insurance Co. Limited www.hdfcinsurance.com

ICICI Prudential Life Insurance Co. Limited www.iciciprulife.com

ING Vysya Life Insurance Company

Limitedwww.ingvysayalife.com

Max New York Life Insurance Co. Limited www.maxnewyorklife.com

MetLife Insurance Company Limited www.metlife.com

Om Kotak Mahindra Life Insurance Co.

Ltd.www.omkotakmahnidra.com

SBI Life Insurance Company Limited www.sbilife.co.in

TATA AIG Life Insurance Company Limited www.tata-aig.com

AMP Sanmar Assurance Company Limited www.ampsanmar.com

Dabur CGU Life Insurance Co. Pvt. Limited www.avivaindia.com

GENERAL INSURERS

Public Sector

National Insurance Company Limited www.nationalinsuranceindia.co

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m

New India Assurance Company Limited www.niacl.com

Oriental Insurance Company Limited www.orientalinsurance.nic.in

United India Insurance Company Limited www.uiic.co.in

Private Sector

Bajaj Allianz General Insurance Co.

Limitedwww.bajajallianz.co.in

ICICI Lombard General Insurance Co. Ltd. www.icicilombard.com

IFFCO-Tokio General Insurance Co. Ltd. www.itgi.co.in

Reliance General Insurance Co. Limited www.ril.com

Royal Sundaram Alliance Insurance Co.

Ltd.www.royalsun.com

TATA AIG General Insurance Co. Limited www.tata-aig.com

Cholamandalam General Insurance Co.

Ltd.www.cholainsurance.com

Export Credit Guarantee Corporation www.ecgcindia.com

HDFC Chubb General Insurance Co. Ltd.  

REINSURER

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General Insurance Corporation of India www.gicindia.com

TOP PRIVATE INSURANCE COMPANY IN INDIA

Earlier we have presented statistics on the market share of all the Life

Insurance companies in Indiaincluding LIC [Public Sector]. Today lets analyze

the difference in market share of Private Sector Life Insurance Companies

over a Year’s time.

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Top 5 Life Insurance Companies in India at the end of April-2008 are:

ICICI Prudential Life – 22.1%

Bajaj Allianz – 13.8%

SBI Life – 9.8%

Reliance Life – 8%

Max New York – 8%

Top 5 Gaines in Life Insurance Business in a Year:

Reliance Life +3.9% gain in total private life insurance market share

Birla Sunlife +3.3% gain in total private life insurance market share

Met Life +2.8% gain in total private life insurance market share

Aviva +2% gain in total private life insurance market share

SBI Life +1.7% gain in total private life insurance market share

Top Losers in Life Insurance Business in a Year:

ICICI Prudential Life – 8.3% loss in total private life insurance market share

Bajaj Allianz – 2.4% loss in total private life insurance market share

HDFC Standard Life – 1.2% loss in total private life insurance market share

From the above data, the reason is now obvious on why K.V.Kamath, wanted

to list ICICI Prudential Life as a separate entity on the bourses.

Through this project I want to study about the life insurance industry and also

doing the comparative analysis between two insurance players in this

industry. They are,

ICICI Prudential Life Insurance

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Life insurance corporation of India

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OBJECTIVES

The entry of foreign MNC’s and the conductive business environment fostered

by the government, it is no wonder that the re-entry of private insurance has

marked a second coming for the sector. In just five years, the sector has

undergone a makeover, offering more choice, better services, quicker

settlement, tighter regulation and greater awareness ‘s the environment

become more and more competitive and services and products become alike,

creating a differentiation is becoming extremely tough.

Thus, this project objectives is as follows

To know where Reliance life insurance Company limited & life

insurance Corporation of India companies stands in the market.

Find out the strength and the weakness of their plans.

And making comparative analysis between the products of Reliance life

insurance Company limited with Life insurance Corporation of India.

SCOPE OF STUDY

This study can be conducted by comparing the performances &

products of three private & government insurance players in

insurance industry.

The number of respondents to be surveyed can be improved.

The study can be conducted in Bangalore city only.

This study can be conducted to analyze the market stand of

Reliance life insurance Company limited and Life insurance

Corporation of India insurance companies.

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INDUSTRY PROFILE

“Insurance is a contract between two parties whereby one party called insurer

undertakes in exchange for a fixed amount of money on the happening of a

certain event.” Insurance is a protection against financial loss arising on the

happening of an unexpected event. The primary purpose of Life Insurance is

the protection of the family. Insurance in it's various forms protects against

such misfortunes by having the losses of the unfortunate few paid by the

contribution of the many who are exposed to the same risk. This is the

essence of insurance- the sharing of losses and substitution of certainty for

uncertainty. Insurance companies collect premiums to provide for this

protection. A loss is paid out of the premiums collected from the insuring

public and the insurance companies act as trustees of the amount collected.

In is a system by which the losses suffered by a few are spread over many,

exposed to similar risks.In the western world, life insurance evolved mainly

from the maritime industry. Started by private financiers who used to gamble

on the lives of seafarers by offering five times the money deposited with them

in case of certain contingencies?

In its present form, life insurance has its origin in England and made its debit

in India in the year 1818.Initially, Indians were not considered on par with

Europeans as far as their insurability was concerned. There were also many

other failures. It was in the early part of the 20th century that some kind of

legislation was made to regulate the industry. From then on life insurance

made great strides in the country.

At the time of independence and thereafter, there were more than 200

companies operating in India and not all of them on sound ethical principles.

Many factors combined together to prompt the then government to nationalize

28

the life insurance industry in 1956 to form the Life Insurance Corporation of

India.

The years from 1956 to 1999 saw the life insurance corporation of India

emerge as a giant financial institution and the lone organization purveying life

insurance, if we ignore the minimal presence of postal life insurance. The

institution succeeded in penetrating in many areas and segments of the

population and in garnering public money for public welfare.

It was in the 1990’s that the winds of change started sweeping over India and

brought in their wake many changes in the economy. Liberalization ensured

competition in many fields and there was a clamor that the insurance industry

too is opened up to Private Indian and foreign players to provide the customer

with a choice.

The Malhotra committee, appointed in 1993 was given the mandate to study

the industry and to suggest the changes that were necessary to make it

modern and in tune with people’s aspirations. The report submitted by the

committee was the precursor of the IRDA Bill.

By the passing of the IRDA Bill, the Insurance sector has been opened up for

the private companies to carry on insurance business. Now the life insurance

industry in India is rapidly evolving and growing. It has witnessed a big

growth as many Indian and foreign were entered in to the Indian insurance

sector. The life insurance industry in India has become fiercely competitive

with the entry of several new players including major multinational insurers

after the deregulation of the sector. It has opened up a range of untapped

opportunities for new entrants into the industry, as the potential market for

buyers is high since the emerging market in India has a low insurance

penetration and high growth rates.

29

COMPANY PROFILE

ICICI PRUDENTIAL LIFE INSURANCE

ICICI Prudential Life Insurance Company is a joint venture between ICICI

Bank - one of India's foremost financial services companies-and Prudential

plc - a leading international financial services group headquartered in the

United Kingdom. Total capital infusion stands at Rs. 47.80 billion, with ICICI

Bank holding a stake of 74% and Prudential plc holding 26%.

We began our operations in December 2000 after receiving approval from

Insurance Regulatory Development Authority (IRDA). Today, our nation-wide

team comprises of over 2100 branches (inclusive of 1,116 micro-offices),

over 290,000 advisors; and 18 bancassurance partners.

ICICI Prudential is the first life insurer in India to receive a National Insurer

Financial Strength rating of AAA (Ind) from Fitch ratings. For three years in a

row, ICICI Prudential has been voted as India's Most Trusted Private Life

Insurer, by The Economic Times - AC Nielsen ORG Marg survey of 'Most

Trusted Brands'. As we grow our distribution, product range and customer

base, we continue to tirelessly uphold our commitment to deliver world-class

30

financial solutions to customers all over India.

THE COMPANY

 ICICI Prudential Life Insurance Company is a joint venture between ICICI

Bank, a premier financial powerhouse, and Prudential plc, a leading

international financial services group headquartered in the United

Kingdom. ICICI Prudential was amongst the first private sector insurance

companies to begin operations in December 2000 after receiving approval

from Insurance Regulatory Development Authority (IRDA).

ICICI Bank 

About ICICI Bank: ICICI Bank Ltd (NYSE:IBN) is India's largest private

sector bank and the second largest bank in the country with consolidated

total assets of over US$ 100 billion as of March 31, 2010. ICICI Bank’s

subsidiaries include India’s leading private sector insurance companies and

among its largest securities brokerage firms, mutual funds and private

equity firms. ICICI Bank’s presence currently spans 19 countries, including

India.

Prudential Plc

Established in London in 1848, Prudential plc is an international retail

financial services group with significant operations in Asia, the US and the

UK serving around 25 million customers, policyholder and unit holders

worldwide. The company has £290 billion of assets under management and

it is one of the best capitalised insurers in the world with an Insurance

Groups Directive (IGD) capital surplus estimated at £3.4 billion (at 31

December 2009). Prudential is a leading life insurer in Asia with a presence

in 12 markets and have the top three position in seven key locations of

Hong Kong, India, Indonesia, Malaysia, Singapore, the Philippines and

31

Vietnam.

OUR VISION

To be the dominant Life, Health and Pensions player built on trust by

world-class people and service.

This we hope to achieve by:

Understanding the needs of customers and offering them superior

products and service

Leveraging technology to service customers quickly, efficiently and

conveniently

Developing and implementing superior risk management and

investment strategies to offer sustainable and stable returns to our

policyholders

Providing an enabling environment to foster growth and learning for

our employees 

And above all, building transparency in all our dealings

The success of the company will be founded in its unflinching commitment

to 5 core values -- Integrity, Customer First, Boundaryless, Ownership and

Passion. Each of the values describe what the company stands for, the

qualities of our people and the way we work.

OUR VALUES :

Every member of the ICICI Prudential team is committed to 5 core values:

Integrity, Customer First, Boundaryless, Ownership, and Passion. These

32

values shine forth in all we do, and have become the keystones of our

success.

LIFE INSURANCE CORPORATION OF INDIA

LIC of India is one of India’s leading financial institutions, offering complete

financial solutions that encompass every sphere of life. From commercial

banking to stock broking to mutual funds to life insurance to investment

banking, the group caters to the financials needs of individuals and corporate.

The Life Insurance Corporation of India (LIC) (Hindi: भा�रती�य जी�वन बी�मा� निनगमा) is

the largest state-owned life insurance company in India, and also the

country's largest investor. It is fully owned by the Government of India. It also

funds close to 24.6% of the Indian Government's expenses. It has assets

estimated of   9.31 trillion (US$ 202.03 billion).[1] It was founded in 1956.

Headquartered in Mumbai, which is considered the financial capital of India,[2] the Life Insurance Corporation of India currently has 8 zonal Offices and

101 divisional offices located in different parts of India, at least 2048 branches

located in different cities and towns of India along with satellite Offices

attached to about some 50 Branches, and has a network of around 1.2 million

agents for soliciting life insurance business from the public.

33

MISSION

"Explore and enhance the quality of life of people through financial security by

providing products and services of aspired attributes with competitive returns,

and by rendering resources for economic development." 

VISION

"A trans-nationally competitive financial conglomerate of significance to

societies and Pride of India."

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. 

34

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.

35

COMPANY PRODUCT

ICICI PRUDENTIAL LIFE INSURANCE PRODUCT

Insurance Plans

ICICI Prudential has a wide array of insurance plans that have been

designed with the philosophy that different individuals are bound to have

differing insurance needs.

 The ideal insurance plan is one that addresses the exact insurance needs of

the individual that will depend on the age and life stage of the individual apart

from a host of other factors.

Life Insurance Plans:

Under Life insurance plans, ICICI Prudential offers plans under the following

major need categories:

 Education Insurance Plans 

 Wealth Creation Plans 

 Protection Plans 

Pension & Retirement Solutions:

The primary objective of a pension plan is to help you provide for your

financial needs in your post retirement years. You will find a Pension Planning

Calculator on the site, meant to make your pension plan review as simple as

possible. The calculator is the first step in your Pension Plan scheme, there

are othe steps towards getting the Indian pension policy you need.

ICICI Pru LifeTime Pension Maxima

36

ICICI Pru LifeStage Pension Advantage

ICICI Pru Elite Pension II   

ICICI Pru Assure Pension  

ICICI Pru ForeverLife    

ICICI Pru Immediate Annuity 

Health Product Suite:

Under Health Product Suite, ICICI Prudential offers plans under the following

major need categories:

Hospitalisation Plans

MediAssure

Hospital Care II  

37

PRODUCT OF LIFE INSURANCE

Children's Policy

Komal Jeevan - Plan No. 159

Children Deferred - Plan no.41

Jeevan Kishore - Plan no.102

Jeevan Chhaya - Plan no.103

Marriage Endowment/Educational Annuity - Plan No. 90

Jeevan Anurag - Plan no.168

Endowment Policy

Endowment with Profits - Plan no.14

Limited Payment Endowment with Profits - Plan no.48

Jeevan Mitra - Plan no.88

New JanaRaksha Policy - Plan no.91

Jeevan Anand Plan no. 149

Jeevan Mitra Triple Cover - Plan no.133

Group Insurance Policy

Janashree Bima Yojana

 Group Insurance Scheme in lieu of EDLI

Group (Term) Insurance Scheme

Group Savings Linked Insurance Scheme

Group Superannuation Scheme

Group Mortgage Redemption Assurance Scheme

Shiksha Sahayog Yojana

Joint Life Policy

Jeevan Saathi - Plan no.89

38

Money Back Policy

Money Back with Profit - Plan no.75

New Money Back - Plan no.93

Jeevan Surabhi 15 yrs - Plan no.106

Jeevan Surabhi 20 yrs - Plan no.107

Jeevan Surabhi 25 yrs - Plan no.108

Jeevan Bharati Plan No 160

Jeevan Samriddhi Plan No 154, 155, 156 157

Bima Bachat- Plan no.175

Pension Plans or Annuities

New Jeevan Dhara - Plan no.148

New Jeevan Suraksha Plan no. 147

Jeevan Akshay II Plan no. 163

Jeevan Nidhi Plan no. 169

Jeevan Akshay V Plan no. 183

Special Plans

Term Assurance - Plan no.43

Mortgage Redemption - Plan no.52

Jeevan Aadhar - Plan no.114

Market Plus - Plan No 181

Jeevan Vishwas Plan No. 136

Jeevan Saral Plan No. 165

Jeevan Pramukh Plan No. 167

Bima Nivesh 2005 Plan No 171

Money Plus-Plan No 180

Term Policy

Convertible Term Assurance - Plan no.58

New Bima Kiran

39

Term Assurance

Anmol Jeevan I Plan No- 164

Amulya Jeevan-Plan No-177

Whole Life Policy

Whole Life with Profits - Plan no.2

Limited Payment Whole Life with Profits - Plan no.5

Single Premium Whole Life - Plan no.8

Jeevan Tarang- Plan no.178

What are the advantages of this plan?”

You can choose to retire at any age between 45 years and 65 years.

On retirement:

Annuity option:

Early retirement benefits:

Other products are:

Money plus

Auto plus

Child plan

Health plan

40

SWOT ANALYSIS

Strengths:

Dedicated Employees.

Well Efficient Management.

Technology.

Diversification of funds.

Strong and popular brand name.

Adaptability to changes.

Weakness:

Lack of good services.

Lack of awareness about insurance among people.

Less coverage in Rural Areas.

Opportunities:

Fast growing economy.

Increasing per –capita income in India.

Saving behavior.

High growth of ULIP industry.

Threats:

Arrival of new entrants in the insurance industry.

Cut throat competition within the industry

41

ADVANTAGES OF LIFE INSURANCE

Protection against risk of untimely death

Life insurance is a product, which offers protection against the risk of death

the full sum assured is made available under a life assurance policy, whereas

under other savings schemes, the total accumulated savings alone will be

available.

Protection during old age

Life insurance can also be used as a means of saving for one’s future. There

are a number of life insurance policies, which in addition to life cover also

provide the means of investing one’s income. The sum as per the policy will

be received only after a period of time. This amount thus provides for the old

age.

Forced savings

Payment of life insurance premiums is compulsory and becomes a habit.

Savings in other scheme can be easily withdrawn and may be used for less

worthy purpose. Termination of a life insurance policy by the policyholder

usually results in substantial loss in benefits under the policy to the

policyholder. One is thus encouraged to save and keep one’s policy alive.

Educational requirements and charity

The object of insurance may be to serve as a security to educational funds in

respect of loans advanced for educational purpose or to provide donations to

charitable institutions like hospital and school.

Nomination and assignment

The life insured can name the person or persons to whom the policy money

would be payable in the event of his death .the proceeds of a life insurance

policy can be protected against the claims of the creditors of the life insured

by effecting a valid assignment of the policy. The beneficiaries are fully

protected from creditors expect to the extent of any interest in the policy

retained by the insured.

42

Marketability and suitability for borrowing

After 3 years, if the policyholder finds that he is unable to continue payment

of premiums he can surrender a policy for a cash sum. A life insurance policy

is accepted as a security for a commercial loan.

Loans from the insurance company

A policy holder can take a loan from his insurance company against the

Security of his life insurance policy provided the terms of the terms of his

policy allow such a loan. This loan can be taken usually after a period of 3

years from commencement of the policy and is a percentage of its surrender

value.

Investment options

The unit link products gives comprehensive insurance solutions that cater to

an individual’s dual need of earning potentially high returns as well as stay for

life. Thus there is an option to invest money in the products that combine the

best of insurance and investment. In a volatile market conditions it is possible

to secure both as one can hedge the investment with saver investment

vehicles that provide a diversified portfolio.

Tax benefits

The Indian income tax act provides tax concessions to the policyholder both

on payment of premium and on the maturity amount.

43

PREMIUMS

The private life insurance industry has recorded a growth of 89% with total

new business premium of Rs. 19,471 crore as against Rs. 10,252 crore in the

corresponding period last year. ICICI Prudential continues to be the largest

private life insurance player with a market share of 7% followed by Bajaj

Allianz Life Insurancewhich has a market share of 5.7%.

The comapnies that have recorded fastest growth in the fiscal '06-07

include Reliance Life Insurance, which grew 381%, followed by SBI Life

Insurance which grew 209%. The high growth has enabled SBI Life to move

into the number three postion after Bajaj Allianz Life Insurance.

44

INFORMATION TECHNOLOGY AND COMPANY

LIC AND INFORMATION TECHNOLOGY

LIC has been one of the pioneering organizations in India who introduced

the leverage of Information Technology in servicing and in their business.

Data pertaining to almost 10 crore policies is being held on computers in

LIC. We have gone in for relevant and appropriate technology over the

years.

1964 saw the introduction of computers in LIC. Unit Record Machines

introduced in late 1950’s were phased out in 1980’s and replaced by

Microprocessors based computers in Branch and Divisional Offices for Back

Office Computerization. Standardization of Hardware and Software

commenced in 1990’s. Standard Computer Packages were developed and

implemented for Ordinary and Salary Savings Scheme (SSS) Policies.

FRONT END OPERATIONS

With a view to enhancing customer responsiveness and services , in July

1995, LIC started a drive of On Line Service to Policyholders and Agents

through Computer. This on line service enabled policyholders to receive

immediate policy status report , prompt acceptance of their premium and get

Revival Quotation, Loan Quotation on demand. Incorporating change of

address can be done on line. Quicker completion of proposals and dispatch

of policy documents have become a reality. All our 2048 branches across

the country have been covered under front-end operations. Thus all our 100

divisional offices have achieved the distinction of 100% branch

computerisation. New payment related Modules pertaining to both ordinary &

SSS policies have been added to the Front End Package catering to Loan,

Claims and Development Officers’ Appraisal. All these modules help to

reduce time-lag and ensure accuracy.

45

METRO AREA NETWORK 

A Metropolitan Area Network, connecting 74 branches in Mumbai was

commissioned in November, 1997, enabling policyholders in Mumbai to pay

their Premium or get their Status Report, Surrender Value Quotation, Loan

Quotation etc. from ANY Branch in the city. The System has been working

successfully. More than 10,000 transactions are carried out over this

Network on any given working day. Such Networks have been implemented

in other cities also.

WIDE AREA NETWORK 

All 7 Zonal Offices and all the MAN centres are connected through a Wide

Area Network (WAN). This will enable a customer to view his policy data and

pay premium from any branch of any MAN city. As at November 2005, we

have 91 centers in India with more than 2035 branches networked under

WAN.

INTERACTIVE VOICE RESPONSE SYSTEMS (IVRS)

IVRS has already been made functional in 59 centers all over the country.

This would enable customers to ring up LIC and receive information (e.g.

next premium due, Status, Loan Amount, Maturity payment due,

Accumulated Bonus etc.) about their policies on the telephone. This

information could also be faxed on demand to the customer.

ICICI PRUDENTIAL AND IT

The Information Technology function at ICICI Prudential is committed to

enable business through the use of technology. It is segmented into 4 groups

to enable highest levels of delivery to the customers: Life Asia Solutions

Group that provides flexibility in designing

46

better product offerings to end-users, the Solutions Group- Web that provides

real-time information to customers and is responsible for customer

relationship management, IT Architecture & Corporate Solutions Group is in

charge of developing and maintaining a blueprint for the IT architecture for the

enterprise as a whole. This team works as an in house R&D Solution Group,

exploring new technological initiatives and also caters to information needs of

corporate functions in the organization. IT Infrastructure group is responsible

for providing hardware, software, network services to the whole

organization.This group runs the 'Digital Nervous System' of the Enterprise at

the highest levels of efficiency and provide robust, scalable and highly

available platform for deployment .

47

OPERATION IN INDIA LIC

48

ASSETS

ASSETS HELD BY ICICI PRUDENTIAL

Assets held as on July 31, 2010 (Rs mn)

Equity 68% 412,922

Debt 32% 189,928

Total 100% 602,849

Assets held by:  

Linked Policy Holders   540,714

Other than Linked Policy Holders   62,136

Total 602,849

ASSETS HELD BY LIC

LIC has more than Rs 6,50,000 crores of assets under management and is

much bigger than all the other insurance companies companies. However

less than 30% of  the assets are invested in the equity market.

49

PERFORMANCE OF FUNDS

ICICI

Scheme          

Performance

(3 year

annualised)

Annualised

Return (Since

Inception)

Inceptio

n

Date

Preserver *  8.60% 7.46%17-May-

04

Preserver III*  8.49% 8.18%13-Mar-

06

Preserver IV*  NA 8.28%27-Aug-

07

Protector@  8.09% 8.07%15-Nov-

01

Protector II@  9.06% 6.82%17-May-

04

Protector III@  8.09% 7.74%13-Mar-

06

Protector IV@  NA 9.18%27-Aug-

07

Balancer#  9.44% 14.99%15-Nov-

01

Balancer II#  10.87% 14.15%17-May-

04

Balancer III#  9.28% 10.69% 13-Mar-

50

06

Balancer IV#  NA 11.36%27-Aug-

07

Maximize$  8.37% 24.56%15-Nov-

01

Maxi miser II$  9.27% 23.76%17-May-

04

Maxi miser III$  8.29% 13.05%13-Mar-

06

Maximiser IV$  NA 10.43%27-Aug-

07

Pension

Preserver*8.41% 7.31%

17-May-

04

Pension

Protector@ 7.96% 7.15%

31-May-

02

Pension Protector

II@ 8.85% 6.73%

17-May-

04

Pension

Balancer# 8.07% 14.66%

31-May-

02

Pension Balancer

II# 9.57% 13.97%

17-May-

04

Pension

Maximiser$ 7.43% 26.16%

31-May-

02

Pension

Maximiser II$ 8.38% 24.28%

17-May-

04

InvestShield 8.63% 7.46% 3-Jan-05

51

Cash@ 

InvestShield Life^  8.55% 11.43% 3-Jan-05

InvestShield

Pension^8.83% 11.74% 3-Jan-05

New Invest

Shield#8.82% 11.74%

21-Aug-

06

Flexi Growth** 7.04% 12.31%20-Mar-

07

Flexi Growth II** 7.68% 13.08%20-Mar-

07

Flexi Growth III** 6.96% 12.18%20-Mar-

07

Flexi Growth IV** NA 9.21%27-Aug-

07

Pension Flexi

Growth**6.31% 12.04%

20-Mar-

07

Pension Flexi

Growth II**7.59% 12.96%

20-Mar-

07

Flexi Balanced^^ 6.81% 9.98%20-Mar-

07

Flexi Balanced

II^^8.37% 11.70%

20-Mar-

07

Flexi Balanced

III^^6.66% 9.67%

20-Mar-

07

52

Flexi Balanced

IV^^NA 8.95%

27-Aug-

07

Pension Flexi

Balanced^^7.06% 11.15%

20-Mar-

07

Pension Flexi

Balanced II^^8.26% 11.88%

20-Mar-

07

Multiplier## NA -0.07%26-Nov-

07

Multiplier II## NA 4.86%25-Feb-

08

Multiplier III## NA 3.97%25-Feb-

08

Multiplier IV## NA 4.70%25-Feb-

08

Pension

Multiplier##NA 3.30%

25-Feb-

08

Pension Multiplier

II##NA 4.24%

25-Feb-

08

Secure Plus@ 8.49% 6.40%01-Aug-

03

Secure Plus

[email protected]% 6.40%

17-Nov-

03

Cash Plus@ 8.61% 6.60%11-Aug-

03

R.I.C.H$$ NA 13.92%17-Mar-

08

53

R.I.C.H II$$ NA 14.87%17-Mar-

08

R.I.C.H III$$ NA 14.00%17-Mar-

08

R.I.C.H IV$$ NA 14.84%17-Mar-

08

Pension R.I.C.H$

$NA 13.39%

17-Mar-

08

Pension R.I.C.H

II$$NA 14.21%

17-Mar-

08

Benchmark

* CRISIL Liquid Fund Index

@ CRISIL Composite Bond Index

# 65% CRISIL Composite Bond Index + 35% BSE 100

$ BSE 100

^ 75% CRISIL Composite Bond Index + 25% BSE 100

** S&P CNX 500

^^ 55% S&P CNX 500 + 45% CRISIL Composite Bond Index

## S&P CNX Nifty

$$ BSE 200

54

PERFORMANCE OF FUNDS LIC

NAV'S AS ON DATE 25/08/2010

EFFECTIVE

FOR

 25/08/2010

PLAN NAME 

& 

FUND OPTIONS

BASIC

UNIT

VALUE

NAV AS

ON DATE

REPURCHASE

VALUE

SALE

VALUE

 BIMA PLUS (140)

DATE OF

LAUNCH

02.02.2001      

 SECURED FUND 10 031.5606 029.9826 031.5606

 BALANCED FUND 10 041.7814 039.6923 041.7814

 RISK FUND 10 061.1593 058.1014 061.1593

FUTURE PLUS (172)

DATE OF

LAUNCH

04.03.2005      

BOND FUND 10 013.7312 013.7312 013.7312

55

INCOME  FUND 10 016.0834 016.0834 016.0834

BALANCED FUND 10 017.2135 017.2135 017.2135

GROWTH FUND 10 023.8208 023.8208 023.8208

JEEVAN PLUS (173)

DATE OF

LAUNCH

18.10.2005      

BOND FUND 10 013.7169 013.7169 013.7169

SECURED FUND 10 014.3262 014.3262 014.3262

BALANCED FUND 10 014.6382 014.6382 014.6382

GROWTH FUND 10 022.3358 022.3358 022.3358

MARKET PLUS (181)

DATE OF

LAUNCH

05.07.2006      

BOND FUND 10 014.1851 014.1851 014.1851

SECURED FUND 10 014.3322 014.3322 014.3322

BALANCED FUND 10 014.3291 014.3291 014.3291

GROWTH FUND 10 015.3786 015.3786 015.3786

56

MONEY PLUS (180)

DATE OF

LAUNCH

20.12.2006      

BOND FUND 10 013.1570 013.1570 013.1570

SECURED FUND 10 013.1663 013.1663 013.1663

BALANCED FUND 10 013.4181 013.4181 013.4181

GROWTH FUND 10 012.0922 012.0922 012.0922

FORTUNE PLUS  (187)

DATE OF

LAUNCH

23.08.2007      

BOND FUND 10 012.4642 012.4642 012.4642

SECURED FUND 10 013.1737 013.1737 013.1737

BALANCED FUND 10 012.1967 012.1967 012.1967

GROWTH FUND 10 012.0437 012.0437 012.0437

PROFIT PLUS  (188)

DATE OF

LAUNCH

23.08.2007      

BOND FUND 10 012.9755 012.9755 012.9755

SECURED FUND 10 013.1191 013.1191 013.1191

57

BALANCED FUND 10 013.7223 013.7223 013.7223

GROWTH FUND 10 011.8177 011.8177 011.8177

GRATUITY PLUS

DATE OF

LAUNCH

22.06.2006

BOND FUND 10 13.7127 13.7127 13.7127

INCOME FUND 10 14.8081 14.8081 14.8081

BALANCED FUND 10 15.4431 15.4431 15.4431

GROWTH FUND 10 14.5432 14.5432 14.5432

HEALTH PLUS (901)

DATE OF

LAUNCH

04.02.2008

HEALTH PLUS FUND 10 011.7634 011.7634 011.7634

MONEY PLUS - I (193)

DATE OF

LAUNCH

22.05.2008      

BOND FUND 10 012.9112 012.9112 012.9112

SECURED FUND 10 015.0076 015.0076 015.0076

58

BALANCED FUND 10 015.0345 015.0345 015.0345

GROWTH FUND 10 014.0035 014.0035 014.0035

MARKET PLUS-I (191)

DATE OF

LAUNCH

17.06.2008      

BOND FUND 10 011.9162 011.9162 011.9162

SECURED FUND 10 012.4216 012.4216 012.4216

BALANCED FUND 10 012.5525 012.5525 012.5525

GROWTH FUND 10 014.1034 014.1034 014.1034

CHILD FORTUNE

PLUS (194)

DATE OF

LAUNCH

01.11.2008      

BOND FUND 10 011.1003 011.1003 011.1003

SECURED FUND 10 015.5220 015.5220 015.5220

BALANCED FUND 10 015.1614 015.1614 015.1614

GROWTH FUND 10 015.4457 015.4457 015.4457

HEALTH PROTECTION DATE OF      

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PLUS (902)LAUNCH

29.04.2009

HEALTH PROTECTION

PLUS FUND10 011.2083 011.2083 011.2083

JEEVAN SAATHI PLUS

(197)

DATE OF

LAUNCH-

29.06.2009      

BOND FUND 10 010.7007 010.7007 010.7007

SECURED FUND 10 010.8049 010.8049 010.8049

BALANCED FUND 10 011.0203 011.0203 011.0203

GROWTH FUND 10 011.7110 011.7110 011.7110

WEALTH PLUS (801)

DATE OF 

LAUNCH

09.02.2010

WEALTH PLUS FUND 10 010.3092 010.3092 010.3092

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FINDINGS AND CONCLUSION

The financial markets have continued to witness unprecedented liberalization,

growth and reforms over the last decade prompted by regulatory compulsions

and a rapid integration between domestic and global markets. And as a result,

one has seen substantial growth in the number of financial firms (insurance

companies, mutual funds, brokerages, banks etc.) and in the number and

variety of financial products and services offered by them. As the need of the

people is changing so is changing the investment habits of the people and this

has brought in a spate of new products and schemes where people can

invest.

The concept of insurance as an investment option has arrived where people

first identify the varying needs of money then converts the needs into specific

amount of money and time required to achieve the objective of investments

plans. The objective of insurance as an investment is to ensure that

investments are driven by pre determined and well thought out investment

plan and that the investments are suitable and adequate to meet these plans.

But for this the planner must understand the universe of investments options.

He/she must be well informed on the risk and return attributes of these

options. In addition to the above, companies should also innovate to come up

with better products that would suit the Indian population and should also try

to market and sell their products through new channels of distribution that can

be effective in selling their products to the masses.

People should identify their needs and then decide on the type of policy they

want to invest in. insurance is a good investment option for those people who

do not know where to invest and who do not want to the risk of capital

erosion. But, people who are financially savvy can opt for term insurance and

invest the rest in other options that may give them higher returns

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Overall we have seen that still LIC is very famous but private insurance

companies like ICICI Prudential are growing at exceptionally fast pace.

Private companies show due concern in grievance management and brings

innovative schemes to attract the customers. Right now they are giving good

competition to LIC and very soon they will give very tough competition to Life

Corporation of India.

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BIBLOGRAPHY:

Website:

www.licindia.com

www.iciciprulife.com

www.irdaindia.org

www.wikipedia.com

Books

Life and Health Insurance –Kenneth Black and Harold D.

Fundamental of Risk and Insurance- Emmet J Vaughan and John

Will

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