marketing strategy of life insurance corporation of india

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MARKETING & SERVICES OF LIFEINSURANCECORPORATION OF INDIA

TERM PAPER

(2011-2014)AMITY UNIVERSITY, NOIDA

SUBMITTED TO SUBMITTED BY

MRS. NEHA PURI VIVEK KUMAR SHARMA

(Faculty Guide ) B.COM (HONS)-2

ND

YEAREnr. No. A3104611096
http://images.google.co.in/imgres?imgurl=http://www.stockwatch.in/files/LIC-India-logo.jpg&imgrefurl=http://www.stockwatch.in/business-news/hotels-sector&usg=__gyuyryEIbUoKs4aVHSWEJhy_bno=&h=300&w=365&sz=47&hl=en&start=6&um=1&tbnid=Db0F1rz4gvw3bM:&tbnh=99&tbnw=121&prev=/images%3Fq%3Dlogo%2Blic%26hl%3Den%26rlz%3D1R2GGLT_enIN345%26sa%3DN%26um%3D1


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DECLARATION

I hereby declare that the project report entitled

MARKETING & SERVICES OF LIC CORPORATION OF

INDIA Submitted to AMITY UNIVERSITY, India, is my

original work and not submitted for the award of any

other degree, diploma, fellowship, or any other similar

title or prizes. I would like to category mention that all the

information that have been collected, analyzed and

known for the project is entirely authentic possession of

mine

(VIVEK KUMAR SHARMA)


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ACKNOWLEDGEMENT

I acknowledge the sincere assistance provided to me from several rather

unexpected quarters during the course of execution of this study. It would be

a mammoth task to place on record my gratitude to each and every one of

them but a whole hearted attempt would be made nevertheless, least I be

branded ungrateful.

Without the co-operation of the management and employees this project

study would not have materialized.

TABLE OF CONTENTS


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1 Executive Summary2 Objectives3 Introduction4 Company Profile

i. Name of the organizationii. Head officeiii. Vision and mission

5. Trade Policies

i. Main Businessii. Ancillary Business

6. Competitors7. Promoters8. Vendors

9. Research and Development Activities10. Key Staff

11. Marketing Policies

12. Comparative Analysis

13. Performance of LIC in Rural Areas

14. Attractive Features of the Company

15. Govt. Policies Related To the Business

16. Findings

17. Bibliography

18. Questionnaire


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EXECUTIVE SUMMARY

Life insurance in India made its debut well over 100 years ago.

In our country, which is one of the most populated in the world, theprominence of insurance is not as widely understood, as it ought to be. Whatfollows is an attempt to acquaint readers with some of the concepts of lifeinsurance, with special reference to LIC.

Life insurance is a contract that pledges payment of an amount to the personassured (or his nominee) on the happening of the event insured against. Thecontract is valid for payment of the insured amount during - The date ofmaturity, Specified dates at periodic intervals and Unfortunate death, if itoccurs earlier.Among other things, the contract also provides for the payment of premiumperiodically to the Corporation by the policyholder. Life insurance isuniversally acknowledged to be an institution, which eliminates 'risk',substituting certainty for uncertainty and comes to the timely aid of thefamily in the unfortunate event of death of the breadwinner.The project undertaken is to understand the marketing strategy of LifeInsurance Corporation of India along with the information technology used byLICI to improve the marketing process. Marketing of life insurance is themarketing of intangible product so it depends upon the need of thecustomers.

Marketing does not begin after the buyer expresses his need. It begins muchearlier. Marketing precisely means creating a need first and triggering theneed into a want.

That means that the success of the company is fully depends upon themarketing management of the company. Marketing management is creatinga revolution in marketing of products and services providing to the marketand consumers of the organization throughout the market.

Marketing management is a powerful tool for achieving organizational goalsand gaining competitive advantage. Summer training project goal is to helpstudents become effective managers in todays competitive, globalenvironment. The fundamental unit of work in all organizations is processes;the focus of the project is on the different marketing processes in the field ofmarketing of the organization.

The marketing strategy adopted by the company is fully responsible for the


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success of the company. The strategy applied today will capture the marketshare tomorrow. In the summer training I have to study the marketingstrategy of Life Insurance Corporation of India. During the training period Imeet the different heads of the marketing division and also the staff to knowthe marketing strategy adopted by LICI. The topic of the project given to me

was,Marketing Strategy of Life Insurance Corporation of India with special

reference to information technology. Daily I have to go through theEthernet of LICI to their information technology better. LIC has beenone of the pioneering organizations in India who introduced theleverage of Information Technology in servicing and in their business.Data pertaining to almost 10 crore policies is being held on computersin LIC,

I have tried to put my maximum effort to make the training programup to its best level.


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OBJECTIVES

OBJECTIVE OF THE PROJECT:-

The main objective of the project is:

Study of marketing &services of LICI, different policies of the companyfor the marketing process.

The project has some other objectives also along with the main objectives.

To know the marketing system of the organization.

To find out other points related to marketing of LIC. To know the mobilization of people's savings by making insurance-

linked savings adequately attractive.

To study the market of investment of funds, the primary obligation toits policyholders, whose money it holds in trust, without losing sight ofthe interest of the community as a whole.

How to deal with customer to conduct business with utmost economy

and with the full realization that the moneys belong to thepolicyholders.

How to involve all people working in the Corporation to the best oftheir capability in furthering the interests of the business.


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INTRODUCTION

Indian Economy is growing consistently. The government is recognizing theneed to improve infrastructure and has taken steps towards public-privatepartnership. If the infrastructure does not improve, this could slow down

progress in the coming years. The country needs huge investments inbuilding power plants, roads and ports to keep pace with the demand ofrapidly growing economy. Insurance industry has a major role to play as itprovides long term funds for infrastructure development and at the sametime strengthens the risk taking ability. It also nurtures the public-privatepartnership.

Insurance of large capital outlays have several risks. These include risksassociated with project implementation, risk from disasters, financial risksetc. Without covering these risks it will be difficult for financial institutions tocommit funds. Insurance takes care of this.

Insurance industry also has a great social significance. It is associated withdisasters, calamity etc. Insurance companies generate funds out of insurancepremium collected and help in uplifting the economy. It also has potential ofemployment opportunities.

Definitely the insurance industry is moving ahead. The main elements in thereform in in the insurance sector was the process of opening up of theinsurance industry in 2000 with foreign direct investment permitted up to 26percent of equity. With the change, global insurers have rushed into thecountry to capture the market.


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COMPANY PROFILEName of the company: Life InsuranceCorporation of India.

Head Office:

YogakshemaJeevan Bima Marg, P.B.No. 19953.Mumbai - 400021

Organizational Structure till today:1 Central office - at Mumbai

2 Zonal offices - 83 Divisional offices - 1064 City Branches 7905 Moffussill Branches 12586 Total Branches - 20487 Branches in Centers 13638 Satellite Sampark office 112


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Objectives of LICI:The establishing objectives of the Corporation are

a) Spread Life insurance widely and in particular to the rural areas and tothe socially and economically backward classes with a view to reachingall insurable persons in the country and providing them adequate

financial cover against death at a reasonable cost.

b) Maximize mobilization of peoples saving by making insurance linkedsavings adequate attractive.

c) Bear in mind, in the investment of funds, the primary obligation to itspolicyholders, whose money it hold in trust, without losing sight of theinterest of the community as a whole; the fund to be deployed to thebest advantage of the investor as well as the community as a whole,keeping in view national priorities and obligations of attractive return.

d) Conduct business with utmost economy and with the full realizationthat the moneys belong to the policyholders.

e) Act as trustees of the insured public in their individual and collectivecapacities.

f) Meet the various life insurance needs of the community that wouldarise in the changing social and economic environment.

g) Involve all people in the Corporation to the best of their capabilities infurthering the interest of the insured public by providing efficient

service with courtesy.

h) Promote amongst all agents and employees of the Corporation a senseof participation, pride and job satisfaction through discharge of theirduties with dedication towards achievement of corporate objectives.

VISION and MISSION Statement:


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VISION OF THE CORPORATION:

A transnational competitive financial conglomerate of

significant to societies and Pride of India.

MISSION OF THE CORPORATION:

Ensure and enhance the quality of life of people throughfinancial security by providing products and services ofaspired attributes with the competitive returns, and byrendering resources for economic development.

TRADE POLICIES


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MAIN BUSINESS

Main business of Life Insurance Corporation of India is selling, administering

and servicing of its various life insurance products which are unique,complex and contingent financial products. Life insurance products arecontingent financial assets to meet the financial risk of untimely death.Life insurance are unique, because all the financial products pay only thetime of maturity, but life insurance pays the event of contingency i.e. deathof the life assured. They are complex because they pays in the event ofcontingency covered under the contract, offer different premium paymentmodes so also having other options like loan, surrender, conversion etc.

Keeping all the above factors in mind, LICI had taken the population age

group 0-60 as usual insurable population in the recent past to tape thepotentials. Through in our countrys practical age range for insurablepopulation actually narrow down to age group 25-50. Sex-wise, workparticipation rate of female is low. Further there are other negative factorslike various social customer, age old mental back etc. inhabiting woman forwhich female insurance potential. LICI lunched Jeevan Bharti planexclusively for woman only to tape the female insurable population. Indianrural insurable population is around 74%. The rural population also takes ahuge part of the growth and development of the trading policies of theorganization.The main business of Life Insurance Corporation of India is related to the

protection of the economic values of a human life. Insurance companies arecalled the insurers. The business is to

a) Bring together persons with the common insurance interest (sharing ofrisk.

b) Collect the share or contribution in the form of premium from all ofthem.

c) Pay out the compensation in the form of claim to those who suffer.

There are responsibilities e.g. education, marriage of children, start in a lifefor sons, a roof over the heads. On the other hand, there will be additional

responsibilities towards parents, brothers and sisters. A family man i.e. headof the family faces the risks to his financial position through

a) Physical and mental disability because of diseases and accidents.b) Retirement from active work life.c) The imponalerable risks viz. death.

Death is certain, but time is uncertain. An untimely and premature death of


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a bread earner brings economic disaster to the dependent family. It isemotional loss is left apart; the family suffers from the financial loss.There are three ways in which these problems can be tackled

a) Social security schemes of the govt.b) Group effort.

c) Individual efforts.

A life insurance policy is a contract between two parties, insurer andinsured for which mutually agreed upon premium has been paid by theinsured within a laid down time framework and the losses are met by theinsurer. With other essentials of valid contract, principle of insurableinterest and principle of utmost good faith are two additional essentials.Based on above essentials, Life Insurance Corporation of India has crossedits fifty second years transacting life insurance business in India with itsgrowth and development with excellent performance years after years and

today it has a strong base in Indian economy.

Life Insurance Corporation of India has a huge fund held in trust for thebenefits of its policyholders and for the benefits of the community; it hasinvested both in Government and public sector, thereby benefiting thesociety at large.

While policies for children have been offered almost from the beginning,offering special plans for female child, for example, Jeevan Sukanya,speaks the volume of the growing responsiveness of the corporation to the

social needs. Favorable mortality experience has also been noted in thecase of children. Earlier, the risk on the life of the children normally used tobegan from the age 18 or 21. LIC has now begun to accept such risk on thechildrens life at the age of seven.

In addition, in most permanent policies, there is a guaranteed cash valueaccumulating and other non-forfeiture benefits which represent thepolicyholders equity or ownership right in the policy. With term insurancethere is usually no cash value build up or other guaranteed benefits. Theinsured is buying pure life insurance protection for a stipulated period.

However, there are plans which stand in a twilight zone like JeevanSandesh. LIC at one time offered a pure savings plan e.g. pure endowmentplan, which was later on withdrawn as it had no insurance element in it.The various types of plans:

a) Term assurance plan:

i. the two year temporary assurance policy


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ii. the mortgage redemption policyiii. the convertible term assurance policy

b) Permanent assurance plans:iv. whole life policyv. limited payment whole life policy

vi. limited payment life policies with single premiumvii. the convertible whole life policyc) Endowment policy:

viii. marriage endowment/ education annuityix. the endowment assurance with limited paymentx. double endowment(without profit)xi. key man insurancexii. endowment policy for persons having irregular incomexiii. plans for persons having short span of very high income life

d) Money back policy

e) Double death benefit policyf) Triple death benefit plang) Plan for housing needs- double death benefith) Joint life policyi) Children assurance policyj) Plan for female childk) Children money back plan without profitl) Plan for handicapped childm)Annuity policy

xiv. immediate annuity policyxv. deferred annuity

xvi. the immediate annuity certainxvii. the deferred annuity certain

n) Pension plan.

Name of the various types of plans issued by LICI:Child plans:1 Child Future Plan2 CDA Endowment Vesting At 213 CDA Endowment Vesting At 184 Jeevan Kishore5 Child Career Plan

6 Komal Jeevan7 Marriage8 Endowment

Educational Annuity Plan9 Jeevan Chhaya10 Jeevan Anurag

Plan for handicapped child:


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1 Jeevan Vishwas2 Jeevan Aadhar

Endowment assurance plan:1 The Endowment Assurance Policy-Limited Payment

2 Jeevan Anand3 Jeevan Mitra (Double Cover Endowment Plan)4 Jeevan Mitra (Triple Cover Endowment Plan)5 The Endowment Assurance Policy6 Jeevan Amrit7 New Janaraksha Plan

Plans for high worth individuals:1 Jeevan Pramukh2 Jeevan Shree-I

Money back plans:1 The Money Back Policy-20 Years2 The Money Back Policy-25 Years3 Jeevan Surabhi-15 Years4 Bima Bachat5 Jeevan Rekha (closed for sale)6 Jeevan Surabhi-20 Years

Special money back plan for woman:1 Jeevan Bharati

Whole life plans:1 The Whole Life Policy2 The Whole Life Policy- Single Premium3 The Whole Life Policy- Limited Payment4 Jeevan Rekha (closed for sale)5 Jeevan Tarang6 Jeevan Anand

Term assurance plan:1 Amulya Jeevan

2 The Convertible Term Assurance Policy3 Anmol Jeevan-I4 Two Year Temporary Assurance Policy

Pension plan:1 Jeevan Nidhi2 Future Plus (closed for sale)3 Jeevan Akshay-III (closed for sale)


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4 New Jeevan Suraksha-I5 Jeevan Akshay-V6 New Jeevan Dhara-I7 Jeevan Akshay-IV (closed for sale)

Unit linked plan:1 Money Plus2 Future Plus (closed for sale)3 Bima Plus (closed for sale)4 Market Plus5 Jeevan Plus (closed for sale)

Golden jubilee plans:1 New Bima Gold2 Bima Gold (closed for sale

Special plan:1 Jeevan Madhur2 Jeevan Saral3 Bima Nivesh 20054 Group Insurance Scheme in Lieu Of EDLI5 Gratuity Plus6 Group Gratuity Scheme7 Group Leave Encashment Scheme8 Group Savings Linked Insurance Scheme9 Group Super Annotation Scheme

Social security scheme:1 Shiksha Sahayog Yojana2 JanaShree Bima Yojana (JBY)

ANCILLARY BUSINESS

In recent years, Life Insurance Corporation of India has been making animpact beyond the field of insurance. LIC Housing Finance Ltd. and LICMutual Fund are two such ventures undertaken by the corporation to caterto the diverse needs of the customers.

New product:

LIC Mutual Fund launched the LICMF INDEX FUND on 14/11/2002. This latestoffering is tailored specifically bearing in mind investors who wish to earn


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high returns from quality stock market investments, by owning diverse indexscrip. The scheme offers investors to choose between 3 different plans viz.

a) SENSEX Planb) NIFTY Planc) SENSEX Advantage Plan.

The scheme has been re-opened for fresh sales from 05/12/2002 after areceiving an encouraging response from retail investors during the IPO.

Jeevan Bima Sahayog Asset Management CompanyLtd. (JBSAMC)was formed in April, 1994 to carry on the investmentmanagement and allied functions of the fund. The marketing set up ofJBSAMC includes around 17000 agents, 28 chief agents and 7 area officesbesides their office. LICMFL has appointed Stock Holding Corporation ofIndia to act as custodian for its securities and 5 Registrars to maintain unitholders records.

COMPETITORS


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There are various insurance companies in the present market. So, LICIalways faced the competition from those competitors. Some of the

competitors of L.I.C.I. are-

1ICICI PRUDENTIAL.2MAX NEW YORK.3BAJAJ ALLIANZ.4ING VYASYA.5MET LIFE.6AVIVA (DABUR AND CGU).7RELIANCE LIFE.8HDFC STANDARD LIFE.9OM KOTAK MAHINDRA.10BIRLA SUN LIFE.11TATA AIG.12SBI LIFE.13SAHARA INDIA.14SHRIRAM.15BHARTI AXA LIFE.

================

PROMOTERS OF LIFE INSURANCE CORPORATIONOF INDIA

Each company follows its own strategy for the promotion its own image, itsproduct and market share. While it is yet to be seen the various strategies

that the insurance companies shall be following when they start functioning,it can safely be assumed that while printed media shall be holding itsimportance, the electronic media shall acquire more and more importance.With the spread of TV to the remotest part of the rural area, its hold over thepublic shall be unmatched. While every company does its best to takerecourse to the various publicity media, it is its performance which shallspeak louder than words. One satisfied policyholder is worth thousandpamphlets distributed. LICI in spite of its monopoly status has been aware of


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its market responsibility. The vast potential of the insurance market of thecountry is well appreciated. For reaching out the remotest part, it hasconsciously opened branches in the rural areas, appointed its field personnel,DO, and agents in such areas, empowered the branches to perform allfunction for speedy disposal.

VendorsThe Life Insurance Corporation of India has the vendors in both marketingand servicing from time to time since its inception, with the market researchand business intelligences. LICI has developed both in marketing andservicing with increase productivity to its credit every year.

The main source of procurement of new business is the agency force withlicense in their hands to act on behalf of LICI. So, in the since agents may becalled the vendor for selling its wide range of varied products. Today, LIChas more than 11 lacs of agents through out the length and breath of thecountry. With the regulatory regime new vendors came to join are thealternate channels like bank assurance and corporate agents. The corporateagents and the bank outlet have open new avenues in increase productivityof LICIs new business during last 6/7 years. Such type of distribution


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channels have not only helped LICI, but to other private companies alsowhom the respective companies has appointed as their alternate channelsand the assurance partners. Also the brokers are appointed by therespective companies to act on behalf of the companies. Under AllahabadDivisional office there are almost eight brokers, eighteen corporate agents

and forty-two bank outlets comprising of Central Bank of India, UCO Banketc.

RESEARCH ANDDEVELOPMENT

HELPING SHAPE THE FUTURE INDIA

The name Life Insurance Corporation of India spells trust in the financialworld. The corporation is renowned for its high standards in investmentpractices, product innovation, and customer services and underwriting. LICItoday is the largest insurer in the world in the assets based of 438079 crores(around $ 100 billion). LICI has over 17 crores policy and settles the highestnumbers of claims, 1.15 crores in a year.

LICIs investment combines financial pragmatism with a concern forimproving the countrys infrastructure and quality of life. Together with theGovt. of India, LICI has been instrumental in initiating various projects thathave contributed to the nation building. LICI today is a modern, vibrantorganization.

In the field of information technology, business process re-engineering, LICI


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has the credit of opening more and more satellite sampark offices andenterprise web portal. The implementation of Enterprise Portal Solution(EPS), the web based system has enabled.

PRODUCT INNOVATIONLICIs product over the years have own many accolades for the innovation.LICI has taken challenge to design products and marketing strategies whichcaptures the imagination of the agents and customers. In todayscompetitive dynamic market, customer chooses the products to suit hischanging needs and financial status. According to suit of the top lyrecustomers and equally to take care of the bottom of the pyramid, LICI has

prioritized to develop separate brands of all these years. After Globalizationand the rapid changes in the financial market, LICI has started a continualmarket research and alert market feedback mechanism accompanied bystate of art actuarial packages and services to ensure a stream of productsas per appetite of the market. LICI s someof the innovative products areJeevan Shree, Jeevan Promukh, Bima Nibesh etc. where as BimaKiran, Jeevan Rekha, New Jana Raksha, New Bima Gold etc. areinnovative for the customers of bottom lyre. Apart from these, microinsurance products are for the down trodden masses.

The consumers behavior has been changing with the changing economy.

Consumerism has overwhelming influent over the buyers of the newgenerations.

Further, due to killer competitions in the market, the needs and awareness ofthe insurance is growing more in the Indian society for which the LICI hasmobilized for all the resources available for its business. As, information isnow increasingly accepted as the most important resources, LICI has givenmuch importance for effective utilization of the much information throughinformation technology as it is the source of significant competitiveadvantage. The slogan LIC knows India better means LIC givesconsiderable time to know, to analyze their products and services andsatisfaction level of the customers with their products and services. So,LICIs vital question is effective management and analyses of data availableto the company to re-infrastructure it in the awake of the technologicalrevolution. LICI has already shifted from administrative hierarchy to singlepoint servicing through extensive use of technology for which customerrelationship management department has been set up.


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LICI and the internet:

Internet is nothing but millions of computers talking in to each other, thusfacilitating people across the global to transact business, communicate,

educate and entertain themselves. If anybody wants to access to acomputer which has an internet connection and type the address, LICI isofficial website will flash on the screen of his computer after a few second.

Internet marketing:

The essential requirement of marketing success is Visibility and Reach inthe market.While in the last couple of decades, information technology hasrevolutionized the way that obtains and process information, the Internet is

now revolutionizing the way that the corporation connects to each other.

Potential of the Internet:The internet is changing the perception of organization towards the marketas well as towards of their own business processes. The internet makespossible aggregation of information over very large scales and thisqualitatively changes the nature and role of enterprise management.The internet provides opportunities to organizations to

a) Optimally centralized.b) Improve instant information and decision making across the world.

c) Provide speedy response through coordination across multiple locations.d) Possess better control over quality of services despite distribution.e) Have automation of much routine function.

The challenges in front of marketers is how to enter the market on the netbefore the competitors do so and in this way build for oneself the first moveradvantage.

As it is, niche, vertical portals are the sites with the most mostly chance ofsurvival in the long run. In India computer penetration is low and insurancemarket has not matured, direct marketing through the net could not be

restricted to select markets city-based, affluent and highly educated.

Alter net channel of premium payment:

a) Internet Payment: As many as seven banks HDFC, ICICI, CenturianBank of Punjab, AXIS Bank, Corporation Bank, Federal Bank andCitiBank and Bill Collection Providers Billijunction.com andBilldesk.com are the main service provider of LICI. Any of the


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policyholder who has a bank account in India can use this facility.

b) Electronic Clearing Services (ECS): This service is currentlyavailable in selected cities. It will be extended to other centers wherethe RBI has extended their ECS facility. A policyholder having an

account in any bank which is a member of local Clearing House can optfor ECS debit to pay premiums. The advantage of this system is thatonce the option is exercised, the policyholder need not visit a branchfor paying the premium or collecting the receipts. On the day indicatedby the policyholder, the premium amount will directly debited to thebank account of the policyholder and the receipt will be issued by thedesignated branch office.

ECS Monthly Mode: ECS channel of premium payment for monthlymode policies introduced from proposal stage for all plans without the5% extra charge. The Mandate Form, duly certified by the banker has

to be submitted along with the Proposal Form for new policy.

c) ATM of Corporation Bank and AXIS Bank: Premium can be paidthrough the ATMs of Corporation Bank and AXIS Bank. This service isavailable for the Corporation Bank and AXIS Bank account holders whoare also the policyholders of the LICI. Policy information will beavailable at the ATM during the days of grace for premium payment.On payment of premium, the policyholder will get an acknowledgementreceipt from the ATM and later on, a designated branch will send theactual receipt to the policyholder.

Online collection of premium through AXISBank:

Renewal premium can be paid at all Axis Bank branches either by usingAXIS Bank cheque or by cash. A receipt is generated by the bank andsigned on behalf of LICI by the AXIS Bank official and handed over thecustomer.

Portal:The policyholder has to entroll his/her policies at the website of the LICIand can pay premium by clicking on the online premium payment tab.This facility is available at the customers of LICI, having access to netbanking facility of the following bank Bank of India, Union Bank ofIndia, Punjab National Bank, State bank of India, HDFC Bank, ICICI Bank,AXIS Bank, Citi Bank, IDBI Bank Centurian Bank of Punjab and InduslndBank.


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KEY STAFF

KEY STAFF

ADMINISTRATIVE STRUCTURE OF KANPUR DIVISIONAL OFFICE

CATEGORIES OF STAFF IN LIFE INSURANCE CORPORATION OFINDIA (LICI)

CLASS-I

a. Managing Director.b. Executive Director.c. Chief/Zonal Manager.d. Secretary/Deputy Zonal manager/Senior Divisional Manager.e. Deputy Secretary/Secretary at Zonal office /Divisional manager.


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f. Assistant Secretary/Assistant Divisional manager/Senior Branchmanager.

g. Administrative Officer/Branch Manager.h. Assistant Administrative Office/Assistant Branch Manager.

CLASS-II

Development Officers

CLASS -III

a. High Grade Assistant.b. Stenographer/Internal Assistant Auditor.c. Section Head

d. Assistant.e. Cashier.f.Typist.g. Machine Operator.h. Record Clerk.

CLASS IV

a. Driver.b. Soppy Head Peon.c. Watchman /Liftmen.

d. Sweeper and Cleaner.

Claims Dept:

This is an operating position to provide administrative support to marketingmanager on branch activities and lease with other departments of thedivisional office in respect of guidance, clarification and advice sought by thebranches. The main role of the officer is that

a) Appropriate data in respect of branches monthly performance as reveled

by the work status report and other relevant returns.b) Effective clarification and advice in respect of references received by the

divisional office from branches.c)Satisfaction of agents and branches in respect of all commission

complaints, including commission bills due from other divisional office.


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New Business (NB) Dept:

This is a specialize position for providing adequate support to branches tounable them to carry out new business functions efficiently and to maintainstandard of underwriting. The main roles played by the officers of new

business are a) Availability of updated guidelines on underwriting practices and on new

business functions and that these guidelines are understood bybranches.

b) Analysis of information about quality of underwriting and other newbusiness functions of the divisions and of each branch.

c)Efficient working of new business department of the division througheffective procedures, control and supervision of stuff.

Office Services (OS) Dept:

This is an operating position to provide efficient office services and to assistin maintenance of office premises and other estates and their accounts. Therole that the manager of the office service department are

a) Economy in purchase of furnisher and equipment and their optimumutilization.

b) Efficient services like Typing pool, Mail, Telephone, Fax etc.c)A system of ensuring security and maintenances of office premises and

other estates and effective watch and ward arrangements.

d) Satisfy employees in respect of services like salary, LTC, leave, terminalbenefits etc.e) Efficient working of OS department through effective procedures,

controls and supervision of staff in the department.

Planning Dept:

This is a specialize position for providing adequate support to branches toenable them to carry out functions of planning and budgeting and review.The planning officer plays the role as

a) A reliable and analytical data for preparation and updating of profile ofthe division and identifying the reliable sources of data by the branches.

b) Trend analysis of performances of branches for review of divisionalmanagement.

c) Evaluation of annual plans and budget of branches and the divisionaloffices on the basis of trend analysis and expected future growth forreview by the divisional management.

d) Better understanding by branches about the concept and processes of


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planning and budgeting.e) Efficient working of planning department of the divisional office through

effective procedures, controls and supervisions.

Policy Servicing Dept:

This is the position for providing adequate support and services in mattersrelating to policy servicing at branch office and the divisions. The workingrole of the particular department is as

a) Availability of timely and reliable data/ information for use at thebranches for effective policy servicing.

b) Update knowledge of policy servicing systems, procedures and rules inthe divisional office and branches.

c) Systematic analysis of data in respect of policy servicing activities with

review and recommendations for appropriate action by the divisionalmanagement.

d) Efficient working of policy servicing department of divisional officethrough efficient procedures, controls and supervisions.

Sales Dept:

This is an operating position for providing adequate support and services inmatters relating to sales function at the divisional office and branch offices.

The role of the officers involve in this department are a) Analytical data with regard to performance of agents and development

effacers for resource planning and development.b) Updated knowledge of sales administrative operation in divisional office

and branches.c)Effective systems, controls and information services for recruitment of

development officers.d) Efficient working of sales department through effective procedures,

control and supervision of staff in the department.

QUALITY OF WORK LIFE IN LICIThe term Quality of Work Life has come to mean in recent times more thanjob security, good working conditions, adequate and fair compensation,equal employment opportunities etc. It ensures to every personopportunities at any level to influence their work environment and to have asay in relation to their work. This also requires the right type oforganizational climate, culture and structure that relate, encourage and


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facilitate questions and challenges to improve the existing modes.

The quality of work life at LICI is ensured through:

1. Generous leave facilities, enhancement of leaves.2. Acceptable working hours, leisure hours.3. Reasonable good working conditions.4. Medical facilities/med claim insurance scheme.5. Leave travel concession (for home and other than hometown)6. Accident benefits while on duty.7. Group savings, line insurance, term insurance.8. Death and retirement benefits/gratuity/pension/family pension.9. Monetary incentives for family planning scheme /for passing

technical examinations of insurance.


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MARKETINGPOLICIES

MARKETING POLICIES

To discuss the marketing policy of any organization, we should know smalloverview of the respective department of the organization. Here, this is a

very small description of the marketing department of Life InsuranceCorporation of India -

MARKETING DEPARTMENT:

The market will see high growth with all the players embarking on anaggressive sales pitch. While emphasis on consolidation of the existingmarket is essential, it has to be ensured that the business growth is notoutpaced by the growth of the market. That requires expanding to newmarkets in an intensive manner. For this a scientific approach to segmenting

markets & planting of marketing intermediaries is needed. Segmentation,thus, should expand beyond the traditional geographical & occupational; tomore specific & area wise location of customer groups i.e. Metro & Non-Metro segmenting etc.The thrust areas for this will include Resource Augmentation, Increasing sizeof the policy and Productivity enhancement of the marketing team.Focus to be given on increasing our geographical penetration by way of SOs,planting of marketing intermediaries in vacant spots and further scientificsegmentation to reach out to new markets. Sensitive concern about the waycompetitors are advancing and how they are going about their business isrequired. Use of P &GS, B &AC and MI and other distribution channels for

cross selling, repeat selling and reference selling and integrating thechannels to ensure a market share of 75 %.

As the Market Leader our thrust areas for the FY 2008-09 are as follows:

1. Greater geographical penetration by way of SOs.2. Distribution Channel Resource augmentation by increasing the

number of marketing intermediaries.3. Increased focus on :-


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a. HNI segmentb. Pension segmentc. Female segment.

4. Data Warehouse to be utilized for focused targeting of leads.5. Skill enhancement of Marketing Intermediaries.

6. Product positioning and effective use of media and advertising tools.7. Micro Insurance and Alternate Channels.8. High Renewal Premium Growth.9. BASMI as a productivity enhancing tool.10. Marketing intelligence to be stressed upon to keep building

awareness as to happenings in the market as well as the strategiesbeing adopted by the competitors.

INTERNET MARKETING

The essential requirement of marketing success is Visibility and Reach inthe market.

While in the last couple of decades, information technology hasrevolutionized the way that obtains and process information, the Internet isnow revolutionizing the way that the corporation connects to each other.

Potential of the Internet: The internet is changing the perception oforganization towards the market as well as towards of their own businessprocesses. The internet makes possible aggregation of information over very

large scales and this qualitatively changes the nature and role of enterprisemanagement.

The internet provides opportunities to organizations to

f)Optimally centralized.g) Improve instant information and decision making across the world.h) Provide speedy response through coordination across multiple locations.i)Possess better control over quality of services despite distribution.j)Have automation of much routine function.

The challenges in front of marketers is how to enter the market on the netbefore the competitors do so and in this way build for oneself the first moveradvantage.


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A FOCUS ON EFFECTIVENESS OF MARKETINGPOLICY

Marketing is an environment centric initiative. A peep into the current andemerging environment is essential. Marketing as far as insurance industry isconcerned must be seen primarily in the context of the fact that it deals in aproduct, which is basically unsought and in respect of which even awarenesshas to be often generated before proceeding to identify a need, convert intoa want and fulfill it.The importance of marketing in insurance industry is more pronounced dueto the fact that the sacrifice of the customer (premium) is real andimmediate where as the benefit is distant and contingent. According toTheodre Leavitt, the consumers do not buy products; they buy solutions to

their problems. In insurance prospective customer may not be able tounderstand his problem and hence may be reluctant to buy insurancesolutions. Hence the marketing of insurance involves the creation ofdemand.

As a national organization LICIs marketing objective is to provide optimalfinancial security through life insurance as extensively as possible to diversepeople-

a) In urban and rural areas.b) With different occupations and sources of income and

c) In high, middle and low income levels, keeping in mind thechanging socio-economic environment of the country, customersatisfaction, need to provide cover at minimum cost, need tomobilize increasing volume of savings.

For achieving these objectives the goals spelt out in the marketing policy to bring about marketing approach in various tiers of LIC, to better penetrateinto rural areas and market segments not covered earlier, to offer adequaterange of products, to improve customer satisfaction, to develop a dynamicorganization and to improve cost effectiveness.

The whole approach to the corporation business activity has beenrefashioned. The concept of organization has been changed from a salesorganization to a marketing organization. The offices are madeenvironmental and the human resource development is aptly exercised.

The strategies adopted by LIC are adapting to the changing needs bycapitalizing on opportunities and are countering threats of the presence of13 other private companies. The LIC has adopted some conscious,


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calculated steps to improve its organizational effectiveness.The review system gives life the performance budgeting and becomes aprocess for a qualitative evolution of results.

DEFINED GOALSThe defined goals of LICS marketing policy are defined as follows:

A. Bringing about a marketing approach in the various tiers of theorganizational Hierarchy.

B. Better penetration into rural areas and market segments urban andrural that are not adequately explored.

C. Offering adequate range of products suitable for different segmentsof people.

D. Improving customer satisfaction- By ensuring need based selling ;By evolving standards of performance for different aspects of

servicing; By devising appropriate procedures and systems; Byenhancing the commitment to service on the part of agents andemployees.

E. Developing a dynamic field organization- With a good geographicallyspread over all parts of the country; Capable of selling and servicingwith knowledge and skill and responsiveness to the customersneeds; with a low rate of exits; with increasing productivity levels.

STRATEGIES

For evolving effective strategies with a view to achieving goals it was found

useful to take a look at the strengths and weaknesses of the organizationand the opportunities and threats before it. No single strategy in isolation willtake us nearer our goals or objectives can be fully sub served by a particularstrategy. What is needed is a total package which when adopted is likely tohelp achieve the goals.

PRODUCT DEVELOPMENT

Product Development is an integral part of the marketing strategies of LICI. Itimplies

i. Improvement in existing product.ii. Introduction of new products.iii. Withdrawal of existing products.

In order that the product development is executed , a continuousstudy of market preference is undertaken which includes feedback from fieldforce , special studies and surveys , study of competitors performance andproducts, trend of current new business , sales statistics etc. The LIC till now


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brought in 172 plans of which only 45 plans are now in vogue and theremaining plans have been withdrawn at different time depending upon themarket trend , profitability etc. Recently introduced new plans JEEVANSARAL, BIMA PLUS and FUTURE PLUS LINKED with units and share market areselling well. The NEW JANARAKSHA plan meets the insurance needs of the

agricultural market segment. There are four PENSION PLANS viz. NEWJEEVAN SURAKSHA, NEW JEEVAN DHARA, and JEEVAN NIDHI to cater to theneeds of pension to the insuring public

UNIT LINKED INSURANCE

In the present Indian market scenario where the falling of interest rates inthe market is resulting in lower of returns under guaranteed return products,investment linked products are an excellent way of providing consumers withexcess of returns. A unit linked insurance product provides an opportunityfor the good investor to benefit from the returns available in the capitalmarket without most of risks inherent in direct investment along withinsurance cover.

A unit linked insurance plan is a combination of the protection and savings oflife insurance with the attractive prospect of investing in securities andcapital market. The insurer accumulates the premium collected frompolicyholders and invests them on behalf of the policyholders. A unitrepresents a proportionate share in the amount of the unit fund by collectionof premium.

Unit linked products are transparent and visible for customers to takedecisions and put the policy holder in control. These products are flexibleand adaptable.

Only four insurance companies are offering unit linked insurance products atpresent.

a) LIC OF INDIAb) BIRLA SUN LIFE INSURANCEc) ICICI PRUDENTIAL LIFE INSURANCEd) OM KOTAK MAHINDRA LIFE INSURANCE

LIC OF INDIA has two unit linked products viz.

a) BIMA PLUSb) FUTURE PLUS

While Bima Plus is a unit linked plan, Future Plus is unit linked pension plan.


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Rewarding System of Agent:

As far as marketing strategy towards field organization is concerned, the

main thrust is given to increase in the number of competent and productiveagents every year. To become an agent, the IRDA has defined certainguidelines for the appointments of agents e.g. age minimum 18 years,qualification 12th standard pass must undergonePre-recruitment training of 100 hours as per course designed by IRDA andalso must have passed the examination. After completion of the training theagents can work for the corporation.

The Corporation has a scheme of Urban Career Agents and Rural CareerAgents to promote the cause of professional sing the agency force. They aregiven stipends for the first two years of their career to enable to settle downin the profession. Thus the groups of agents are increasing.

The reward system for agents is another, which is presently linked withpremium and conservation of business, in the form of commissions (SEEAPPENDIX). In addition to the monetary compensation, non-monetaryrecognition system including vesting of functioning powers has been evolvedto enhance the status of agents. In order to recognize agents who performconsistently year after year, clubs at five levels have been designed viz.Chairman, Zonal Manager, Divisional Manager, Branch Manager, andDistinguished Agents. The qualifying standards demand consistently over aperiod of 3 or 4 years. Rules are given in APPENDIX. This club membershipenjoys certain privileges and authority. Moreover there is a scheme forfinancing advances to agents which is given in APPENDIX.

Development Officers:While Development officers will continue to be the main sources of creationof new agencies, marketing policy of LIC envisages the creation ofadditional sources. Accordingly insurance is also sold through corporateagents, brokers and bank assurance (selling insurance through Banks). Asregards Development officers, thrust has been given that they should recruitagents giving due regards to their suitability for under tapped segments andareas. For these, the agency force now stands at 11 lacs.

The marketing policy also envisages the development of a dynamic fieldorganization. With the view, the corporation has established traininginstitutes as mentioned in the organization structure in this booklet. Themethodology adopted includes both class room/ theoretical and on the job


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training with relevance to the segments /areas where the field force willmainly be operating, using the latest communication equipment in the audio/visual area. The employees/ field force is nominated to these institutes forvarious programme and refresher courses. As per LIC annual report on3/2004, the Development officers and agents trained during the financial

year 2003-2004 in these institutes are:

ZTC: 9058 numbersSTC: 52288 numbersDTC: 17953 numbersATC: 12013 numbers

Apart from the above, DTC and ATC imparted training to 331560 agents.

Public Relation and Publicity:

The LICs public relation and publicity efforts aimed at building a strongbrand image of the Corporation brought fruits in the form of accolades fromdiverse entities. During the year 2003-2004, 20 crore people were reachedthrough LICs publicity campaign. The corporation received the BrandLeadership Award at the India Brand Summit and was rated MostTrusted Service Brand after a survey by ECONOMIC TIMES, and ORGMARG Dun and Brand Street has ranked LIC as NUMBER ONE among the top500 companies in India.

The effective marketing policy and strategies of LIC is responsible for such a

brand image of the Corporation. In the following pages, attempt has beenmade to discuss the performance of LIC keeping in mind the statedobjectives of nationalization and marketing policy.


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Comparative Analysis

TOTAL FIRST YEAR PREMIUM OF INSURANCE

COMPANIESfigures in crores

TOTAL FIRST YEAR PREMIUM NO OF POLICIES

LIFE INSURER FOR 2007-2008FOR2008-2009 2009-2010

2010-2011

LIC OF INDIA 19785.93 16240.43 2,69,68,0692,40,27,393

ICICI 1584.08 750.91 4,36,196 6,14,673

BSLI 621.28 449.86 1,55,598 1,98,370

HDFC 486.15 209.33 2,03,205 2,06,320

SBI 482.93 202.47 86495 1,29,974

TATA AIG 300.22 180.15 1,61,967 2,28,894BAJAJ ALLIANZ860.02 179.7 1,85,350 2,88,191

MAXNEWYORK 224.69 124.08 1,45,581 2,16,671

OM KOTAK 374.75 77.14 51071 63468

AVIVA 192.29 72.55 71001 83209

ING VYSYA 281.62 27.88 90977 1,11,141

AMP SANMAR 91.18 23.38 46282 35268

[email protected]


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Performance of LIC in Rural Areas

One of the objectives of LIC is to spread life insurance in rural areas and LIChas been quite successful in attaining the objective. Over the years, therehas been a significant increase in rural business. As per the earlier definition

of rural, half of the LICs business came from rural areas, since the IRDAregulations came into being, the definition of rural is revised specifying thatonly the villages with population less than 5000 and 75% of male populationare engaged in agriculture, and density of population up to 400 per sq. kmare rural areas. The rural population as per census is estimated at 74.3% oftotal population. As per the definition of rural areas by IRDA, the newbusiness from rural areas amounts to Rs.35651.99 crores sum assured under62.19 lakhs policies representing 22.79% and 17.85% share of policies andsum assured respectively during the year 2003-2004 as compared to 45.23lakh policies and Rs. 23547.69 crs sum assured in 2002-2003 and 35651.99cr sum assured,62.19 lakh policies. The growth rate in rural business is

37.50% in NOP and 51.40% is sum assured in 2003-04.


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The Insurance business in India now:

The insurance business in India was monopoly business of LIC of India byGovt. after nationalization. The sector has been opened up in the year 2000as there was an urgent need in view of economic liberalization which refers

to the efforts taken by the state towards faster economic development byadopting changes in existing economic policies, rules and regulations.

The insurance business is growing at a faster rate due the presence of 13private competitive players. The total business in respect of individualinsurance and group insurance as recorded by the insurance industry in Indiaas a whole during the last two financial years are as under:-

YEAR NO OF POLICIES(lakhs)

AMOUNT OF PREMIUM(crores)

2003-2004 286.27 18669.402004-2005 262.60 25342.88

Position of market share as in the above two years of 13 private insurers andLIC of India is as under:-

Year LIC individual Private Insurance

Premium Policies Premium Policies

3/2004 86.05% 94.21% 13.95% 5.79%

3/2005 78.07% 91.5% 21.93% 8.50%

In respect of Group insurance the LICs market share in 2004-05 is 84.67%and 74.31% in premium and number of policies respectively.

10. Therefore, it may be said that in spite of 13 other private insurancecompanies ,LIC of India is the market leader and will be able to stand asgiant in future . The LIC at present has more than 17 crores policyholders.


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ATTRACTIVE FEATURES OF

THE COMPANY

ATTRACTIVE FEATURES OF THE COMPANY

SPECIAL FEATURES/ STRENGTH OF LIFE INSURANCE CORPORATIONOF INDIA

1. Since 1956, LIC has been reaching out to millions of individuals

through a network of 2048 branches and committed teams ofemployees and agents.

2. In addition to being the premier life insurer in India, LIC has asignificant presence through overseas offices in Mauritius, London,Fiji, Kenya, Burma and gulf countries and also through overseasjoint ventures in Sri Lanka, Nepal and Mauritius.

3. LIC today has earned the status of the worlds largest life insurancecompany operating with a clientele of over 18 crores policies in asingle country.

4. LICI is the 2nd largest PC user in the country.

5. Human Resources strength:

a) Managerial - - -19160b) Development officers - - - 19230c) Supervisory, Clerical and Subordinates - -76198d) Agents - - - -10,52,283e) Urban Career Agents - - - -25,856f) Rural Career Agents - - - -46,418

6. Product Strength:

a) Lowest premium ratesb) Least premium for Accident Benefitc) Plans available from new born to aged


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d) Highest Bonus ratese) Innovative productsf) Micro insuranceg) Highest number of products at present 42 products.

7. A glorious track of awards for LIC speaks for its strength. A few ofthem are as follows:

a) Awaz Consumer Awards 2005 and 2006 given by CNBC TV.

b) Golden Peacock Global Award for corporate socialresponsibility by World Council for corporate governance2004 and 2005.

c) LIC adjusted no.1 in Net Worth and Net Profit among 500 top

companies by Dun and Bradstreet, 2004.

d) Golden Peacock Innovative Product/service Awards, 2004 and2005.

e) LIC adjusted no.1 Service brand in India by Economic Timesand AC Neilson Org Marg in 2004 for 2nd consecutive year.

f) NDTV Profit Business Leadership award 2006.

g) Readers Digest Trusted Brand Award 2007.

h) Consumers Super brand Award, 2006-07.

i) Asia Insurance Merit Award 2005/2006 in the area ofCorporate Social Responsibility.

LICs e-portal website has won Webbys Consumer votedBest website award.

STRENGTH

An insurance agent when he goes out to the market to canvass insurance on

behalf of its company, must be aware of the strength of its company, howdoes it stands better than others, why should a prospect insure with thiscompany instead of any other company which also offer similar life insuranceproducts. The agent has to sell its company before it tries to sell lifeinsurance products. The agent, therefore, would do well to know thecompany profile, which is normally available in the form of a printedpamphlet and emphasis on the companys strengths. Here however theagent is cautioned against any exaggerations or falsehood or hyperbole


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spoken in praise of the company, as at a later stage the bluff may be calledand shall put him and the company in the bad light.

Admission of Age:

Age is the main basis of calculation of premium under life insurance policies.The following are accepted as evidence of age

Certified extract from Municipal or Local Bodys records made at thetime of birth.

Certificate of Baptism or Certified Extract from Family Bible, if itcontains age or date of birth.

Certified Extract from School or College records, if age or date of birthis stated therein.

Certified Extract from Service Register in the case of Govt. employeesand employees of Quasi-Govt. Institutions or

Passport issued by the Passport Authorities in India.

Payment Of Premium:

By cash, local cheque (subject to realization of cheque), Demand Draft

at Branch Office. The DD and cheques or Money Order may be sent by post.

You can pay your premiums at any of our Branches as 99% of ourBranches are networked.

Many Banks do accept standing instructions to remit the premiums. Soby providing a standing instruction to your Bank to debit your accountfor the premium amount and send it vide a bankers cheque to LIC, onthe due dates and months mentioned on your policy bond.

Through Internet : Payment of premiums can be made through Internetthrough Service Providers viz.HDFC Bank, ICICI Bank, Times of Money,Bill Junction, UTI Bank, Bank of Punjab, Citibank, Corporation Bank,Federal Bank and BillDesk.

Premium payment can also be made through ATMs of CorporationBank and UTI Bank.


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Premium payment can also be made through Electronic ClearingService (ECS) which has been launched at Mumbai, Hyderabad,Chennai, Kolkata, New Delhi, Kanpur, Bangalore, Vijaywada, Patna,Jaipur, Chandigarh, Trivandrum, Ahmedabad, Pune, Goa and Nagpur,

Secunderabad & Visakhapatnam. A policyholder having an account inany Bank which is a Member of the local Clearing House can opt forECS debit to pay premiums. The policyholders wishing to use thissystem would have to fill up a Mandate Form available at ourBranches/DO and get it certified by the Bank. The certified MandateForms are to be submitted to our BO/DO.

OPERATION OF LICI

LICI operate all over the India.

Every year LICI expanding its business places to cover all the places of Indiaincluding both rural and urban areas.

LIC has traversed a long distance surpassing many milestone and creatingnumerous new landmark along the way. LIC is perhaps the single largestfinancial institution with a total life fund of over Rs. 3,85,000/- crore, 17 crorepolicies and a total annual income of Rs. 1,07,969/- crore on 31 st march,2005. There was an accretion of Rs. 64,000/- crore to the life fund aftermeeting the claim liabilities, which is nearly 4% of the GDP of the country.

During the year 2004-2005, LIC settled a staggering 115 lakh claims,maturity and death, with a pay-out of nearly Rs. 25,000/- crore.

In the tenth five year plan along the contribution of LIC to the resourcemobilization was over Rs. 1,80,000/- crore.

ON THE SPOT POLICIES

The first on-the-spot-policies campaign was launched by the Northern Zoneon 15th August 1961 in Sampla, a place in Chandigarh Division, where 44

policies assuring a sum of Rs. 2.10 lakh were issued. This was followed byanother drive at Larsauli by the same branch where 100 policies assuring asum of Rs. 5.32 lakh were issued.

Technology has enabled LIC today to realize its Endeavour of On the spotpolicies on a mass scale and as a matter of routine process. Year 2000witnessed LIC going in for large scale Business process reengineering andthe Green Channel was born as one of the outcomes. The Green Channel


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is an improved New Business module which allows issuance of instantpolicies. Just take a look at how the Green Channel functions and the PolicyBond is delivered across the counter:

1 The Proposer or his Agent brings the proposal to the NB section and itsregistered.

2 The proposal is underwritten and if it is acceptable, a decision isrecorded.3 Premium quotation is provided for payment.4 Actual premium is paid at the counter, policy number is allotted and

premium receipt is issued, thereby avoiding the proposal depositstage.


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LICs MARKET PLUS

This is a unit linked pension plan wherein the pension is payable after aspecified period. Four types of investment Funds namely Bond, Secured,Balanced and Growth Fund are offered. Though primarily a Pension product,

the plan has many attractive features and options which make it an idealRetirement solution for the future.

Benefits:

A) On Vesting:On vesting of the policy, the Fund Value will be utilized to provide a pensionbased on the then prevailing Annuity rates. An option to commute up to onethird of the payable benefit in a lump sum is available.

B) On Death:

In event of the unfortunate death of the policy holder the Fund Value alongwith the Riders, if any, will be payable in a lump sum or as a pension.


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GOVT. POLICIES RELATED TOTHE BUSINESS

GOVT. POLICIES RELATED TO THE BUSINESS

LIFE INSURANCE CORPORATION ACT, 1956

While piloting the bill for the establishment of the LICI, the then FinanceMinister made the objectives of the corporation in the following

a) The business must be conducted with the utmost economy and in aspirit of trusteeship, with the full realization that the money belongsto the policyholders.

b) The premium must be no higher than warranted by strict actuarialconsideration.

c) The fund must be invested so as to accrue the maximum yield for thepolicyholders that it may be possible to secure consistency with thesafety of the capital.

d) It must render prompt and efficient service to its policyholders andthereby make insurance widely popular.

The nationalization of the life insurance business was felt to be a need in thepublic interest, as a public utility and a social service. It is justified on thegrounds of ideology, philosophy and the objective of the welfare state. Itwas based on a desire to mobilize the savings of the community for meetingthe objectives of the five year plans.

THE VARIOUS PLANS


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a) Term assurance plan:xviii. the two year temporary assurance policyxix. the mortgage redemption policyxx. the convertible term assurance policy

b) Permanent assurance plans:xxi. whole life policyxxii. limited payment whole life policyxxiii. limited payment life policies with single premiumxxiv. the convertible whole life policy

c) Endowment policy:xxv. marriage endowment/ education annuityxxvi. the endowment assurance with limited paymentxxvii. double endowment(without profit)

xxviii.key man insurancexxix. endowment policy for persons having irregular incomexxx. plans for persons having short span of very high income life

d) Money back policye) double death benefit policyf) triple death benefit plang) plan for housing needs- double death benefith) joint life policyi) children assurance policyj) plan for female child

k) children money back plan without profitl) plan for handicapped childm)annuity policy

xxxi. immediate annuity policyxxxii. deferred annuityxxxiii.the immediate annuity certainxxxiv.the deferred annuity certain

n) pension plan


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FINDINGSFINDINGS DURING THE PROJECT

1. LIFE INSURANCE CORPORATION OF INDIA has great goodwill theliberalized Indian market. It is the sole public sector player in the lifeinsurance market of India with twenty one private companies incountrys market.

2. There is a lot of scope of life insurance in India. Only 2.5 people aresecure with life insurance so the insurance sector is its booming stagethis boom will more increase in 2-3 years.

3. Good profile insurance advisor could do better job. If LICI mentions the

level of advisor then they give great sales to the company.

4. LICI has tuff competition with all the leading private players of the lifeinsurance market viz. ICICI PRU, TATA AIG, BAJAJ ALLIANCE, BIRLASUNLIFE INSURANCE, SAHARA, ING VYASA, OM KOTAK MAHINDRA,HDFC INSURANCE, SBI LIFE etc.

5. 5.LICI has interested and profitable plans for different age groups.

6. Within 20-25 year age group the sincerity level is high. They are careeroriented and want to earn more.

7. In 25-30 age group people made interest to purchase the kids plan andpension plan and money back plan.

8. In the age group of 30-35 years the people who are earning more than3 lakh p. y. made interest to purchase ULIP.

9. I found that in insurance sector a person should have greatcommunication and convenience skill.

10. Because of pressure the

employees are not able to give their best performance. They dontwant to take too many risks.

Having to offer risk coverage to its insuring public, it cannot match othersaving instruments in terms of rate of return and therefore stands at adisadvantage. The question of market share, therefore, shall become


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relevant only decade hence

BIBLIOGRAPHY1. www.licindia.com
http://www.licindia.com/http://www.licindia.com/


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2. www.irdaindia.com3. www.google.com4. www.wikipidia.com

5. Marketing Management - Phillip Kotler
http://www.irdaindia.com/http://www.google.com/http://www.irdaindia.com/http://www.google.com/


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Questionnaire

Name : Age :Occupation : Income :

1. Do you have any Insurance policy?a) Yes [ ] b) No. [ ]

2. If yes in which insurance company you have your policy?a) LIC [ ] b) ICICI [ ]c) HDFC [ ] d) Birla Sunlife [ ]If noWhy...................................

3. Reasons for purchasing life Insurance Policy?a) To cover life risk [ ]

b) To save tax [ ]c) To invest saving [ ]d) To meet income need after retirement [ ]e) any other [ ]

4. What benefit you feel for purchasing insurance policy?a) Life risk cover [ ]b) Medi claim facility provides. [ ]c) Family requirements fulfilled after death

Of earning hand. [ ]d) Loan Facility. [ ]e) Returns after the specific period aids to

The income. [ ]f) All the above [ ]

5. Which according to you is better insurance company?a) LIC [ ] b) ICICI [ ]c) HDFC [ ] d) Birla Sunlife [ ]

6. What are the reasons behind your choice of insurance

company?a) Better Services [ ]b) Better Plans [ ]c) Better Returns [ ]d) Better Pension plan and other schemes [ ]e) Better goodwill [ ]


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7. Which sector you feel better for insurance sector?a) Public [ ] b) Private [ ]

8. Do you feel that government should take proper measures to

increase the promotion of life insurance?a) Yes [ ] b) No [ ]9. In which insurance Company you would like to invest in near

future?a) LIC [ ] b) ICICI [ ]c) HDFC [ ] d) Birla Sunlife [ ]

10. What benefits you feel from taking a life insurance policy (20words)?................................................................................................................................................................................

marketing strategy of life insurance corporation of india

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