TYBBI

What is Insurance ?

Insuranceis the equitable transfer of the risk of a loss, from one entity to another in exchange for payment. It is a form ofrisk managementprimarily used tohedgeagainst the risk of a contingent, uncertain loss. An insurer, or insurance carrier, is a company selling the insurance; the insured, or policyholder, is the person or entity buying the insurance policy. The amount ofmoneyto be charged for a certain amount of insurance coverage is called the premium.Risk management, the practice ofappraisingand controlling risk, has evolved as a discrete field of study and practice.The transaction involves the insured assuming a guaranteed and known relatively small loss in the form of payment to the insurer in exchange for the insurer's promise to compensate (indemnify) the insured in the case of a financial (personal) loss. The insured receives acontract, called theinsurance policy, which details the conditions and circumstances under which the insured will be financially compensated.

Definition Insurance as a form of contract or agreement under which one party agrees in return for a consideration to pay an agreed amount of money to another party to make good a loss , damage, or injury to something of value, as a result of some uncertain even in which the insured has pecuniary interest.

History

Early methods Methods for transferring or distributing risk were practiced byChineseandBabyloniantraders as long ago as the3rdand2ndmillenniaBC, respectively.Chinese merchants travelling treacherous river rapids would redistribute their wares across many vessels to limit the loss due to any single vessel's capsizing. The Babylonians developed a system which was recorded in the famousCode of Hammurabi, c. 1750 BC, and practiced by earlyMediterraneansailingmerchants. If a merchant received a loan to fund his shipment, he would pay the lender an additional sum in exchange for the lender's guarantee to cancel the loan should the shipment be stolen or lost at sea. At some point in the 1st millennium BC, the inhabitants ofRhodescreated the 'general average'. This allowed groups of merchants to pay to insure their goods being shipped together. The collected premiums would be used to reimburse any merchant whose goods were jettisoned during transport, whether to storm or sinkage.

Modern insurance Insurance became far more sophisticated inEnlightenment eraEurope, and specialized varieties developed.Property insuranceas we know it today can be traced to theGreat Fire of London, which in 1666 devoured more than 13,000 houses. The devastating effects of the fire converted the development of insurance "from a matter of convenience into one of urgency, a change of opinion reflected in SirChristopher Wren's inclusion of a site for 'the Insurance Office' in his new plan for London in 1667".A number of attempted fire insurance schemes came to nothing, but in 1681,economistNicholas Barbonand eleven associates established the first fire insurance company, the "Insurance Office for Houses", at the back of the Royal Exchange to insure brick and frame homes. Initially, 5,000 homes were insured by his Insurance Office. At the same time, the first insurance schemes for theunderwritingofbusiness venturesbecame available. By the end of the seventeenth century, London's growing importance as a centre for trade was increasing demand formarine insurance. In the late 1680s, Edward Lloyd openeda coffee house, which became the meeting place for parties in the shipping industry wishing to insure cargoes and ships, and those willing to underwrite such ventures. These informal beginnings led to the establishment of the insurance marketLloyd's of Londonand several related shipping and insurance businesses. The firstlife insurancepolicies were taken out in the early 18th century. The first company to offer life insurance was theAmicable Society for a Perpetual Assurance Office, founded in London in 1706 byWilliam TalbotandSir Thomas Allen.[7][8]Edward Rowe Moresestablished theSociety for Equitable Assurances on Lives and Survivorshipin 1762. T=Any risk that can be quantified can potentially be insured. Specific kinds of risk that may give rise to claims are known as perils. An insurance policy will set out in detail which perils are covered by the policy and which are not. Below are non-exhaustive lists of the many different types of insurance that exist. A single policy may cover risks in one or more of the categories set out below. For example,vehicle insurancewould typically cover both the property risk (theft or damage to the vehicle) and the liability risk (legal claims arising from anaccident). Ahome insurancepolicy in the United States typically includes coverage for damage to the home and the owner's belongings, certain legal claims against the owner, and even a small amount of coverage for medical expenses of guests who are injured on the owner's property. Businessinsurance can take a number of different forms, such as the various kinds of professional liability insurance, also called professional indemnity (PI), which are discussed below under that name; and thebusiness owner's policy(BOP), which packages into one policy many of the kinds of coverage that a business owner needs, in a way analogous to how homeowners' insurance packages the coverages that a homeowner needs.Auto insurance Auto insurance protects the policyholder against financial loss in the event of an incident involving a vehicle they own, such as in atraffic collision.Coverage typically includes: Property coverage, for damage to or theft of the car Liability coverage, for the legal responsibility to others for bodily injury or property damage Medical coverage, for the cost of treating injuries, rehabilitation and sometimes lost wages and funeral expensesGap insurance Gap insurance covers the excess amount on your auto loan in an instance where your insurance company does not cover the entire loan. Depending on the companies specific policies it might or might not cover the deductible as well. This coverage is marketed for those who put lowdown payments, have high interest rates on their loans, and those with 60 month or longer terms. Gap insurance is typically offered by your finance company when you first purchase your vehicle. Most auto insurance companies offer this coverage to consumers as well. If you are unsure if GAP coverage had been purchased, you should check your vehicle lease or purchase documentation.Health InsuranceWe understand that people are unique and have varying levels of control over their health. Each of us would like to define a healthy life on our own terms. At SBI General, its our aim to partner with you and help you achieve better health and a sense of security along the way.In times of rising health care costs, a sudden illness or injury can leave you financially devastated and highly stressed. With SBI Generals Health Insurance Policy Retail, you can be in control by making medical treatment expenses more manageable. Thus ensuring quality health & happiness of your family.

HEALTH INSURANCE

Apollo DKV Health Insurance has renamed itself Apollo Munich Health Insurance as a part of its five-year strategic plan to gain a five per cent market share. Apollo Munich is a joint venture between Asias largest integrated healthcare provider, TheApollo HospitalsGroup, and Germany-based Munich Res segment, Munich Health.CoverageThis policy covers the following subject to the terms and conditions:Sr. no.Expense HeadsExpense Limit(Rs).

1Medical Treatment with Room, Board & Nursing Expenses & Service Charges etc.Up to 1% of the Sum Insured per day

2Medical Treatment in Intensive Care UnitUp to 2% of the Sum Insured per day

3All admissible claims under 1 & 2 during the policy periodUp to 25% of the SI per illness/injury per claim

4Consultants & Specialists FeesUp to 40% of the SI per illness/injury per claim.

5Anaesthesia, Blood, Oxygen, OT Charges, Surgical AppliancesUp to 40% of the SI per illness/injury per claim.

6Pre-hospitalisationUp to 10% of the eligible hospitalisation expenses incurred 30 days prior to date of admission into the hospital.

7Post-hospitalisationUp to 10% of the eligible hospitalisation expenses incurred 60 days after the date of discharge from the hospital.

8Ambulance charges1% of SI up to a max of Rs. 1500.

9Free Medical Check upFree medical check-up - 1% of SI up to a max of Rs. 2500 for every 4 claim free years.

10Parental Care: Attendant nursing charge to take care of you parents who are above 60 years of age.Available for persons above 60 years old. Attendant nursing charges after discharge from the hospital for Rs 500 or actual whichever is less per day up to a max. 10 days per hospitalisation. The charges can be reimbursed for a period not exceeding 15 days during the entire Policy period.

11Child Care: Attendant escort charges to take care of child below 10 years of age.Available for child below 10 years. Attendant escort charges of Rs 500 for each completed day of hospitalisation subject to maximum of 30 days during the Policy Period.

12Limit of Cataract15% of sum insured subject to maximum of 25000 per eye subject to first two years exclusion.

13Accidental HospitalisationSum Insured Limit under the policy shall increase by 25% of the balance sum insured available subject to max of Rs.1 Lac. in case of accidental hospitalisation. Payable only once under the Policy per person.

14Alternative Treatment (Subject to Treatment taken at a Ayurvedic hospital confirming with our definition of hospital and which is registered with any of the local Govt. bodies)Reimbursement of Ayurvedic Treatment up to a maximum of 15% of Sum Insured per Policy period up to a maximum of Rs. 20000 & Homeopathy and Unani Treatment upto a maximum 10% of Sum Insured per Policy period up to a maximum of Rs. 15000.

15Domiciliary HospitalisationReasonable and Customary Charges towards Domiciliary Hospitalisation as defined in Policy definition subject to 20% of the Sum Insured maximum up to Rs.20000 whichever less is.

16Convalescence Benefit- Benefit available for Insured above 10 years & below 60 years.Covers select Day Surgery where less than 24 hours hospitalisation for specified procedures like Dialysis, Chemotherapy, Radio therapy, Eye Surgery, Dental Surgery (Due to accident), Tonsillectomy, etc are covered.

17Co-Payment on all eligible admissible claims in non-network hospitals10% on all eligible admissible claims.

18Cashless facilityAcross SBI General's Network Hospitals

19Coverage for select Day Surgery procedures where less than 24 hours hospitalisation is required.Covers select Day Surgery where less than 24 hours hospitalisation for specified procedures like Dialysis, Chemotherapy, Radio therapy, Eye Surgery, Dental Surgery (Due to accident), Tonsillectomy, etc are covered.

Accident, sickness, and unemployment insurance Workers' compensation, or employers' liability insurance, is compulsory in some countries Disability insurancepolicies provide financial support in the event of the policyholder becoming unable to work because of disabling illness or injury. It provides monthly support to help pay such obligations asmortgage loansandcredit cards. Short-term and long-term disability policies are available to individuals, but considering the expense, long-term policies are generally obtained only by those with at least six-figure incomes, such as doctors, lawyers, etc. Short-term disability insurance covers a person for a period typically up to six months, paying a stipend each month to cover medical bills and other necessities. Long-term disability insurance covers an individual's expenses for the long term, up until such time as they are considered permanently disabled and thereafter. Insurance companies will often try to encourage the person back into employment in preference to and before declaring them unable to work at all and therefore totally disabled. Disability overhead insuranceallows business owners to cover the overhead expenses of their business while they are unable to work. Total permanent disability insuranceprovides benefits when a person is permanently disabled and can no longer work in their profession, often taken as an adjunct to life insurance. Workers' compensationinsurance replaces all or part of a worker'swageslost and accompanying medical expenses incurred because of a job-related injury.Casualty InsuranceCrime insuranceis a form of casualty insurance that covers the policyholder against losses arising from thecriminal actsof third parties. For example, a company can obtain crime insurance to cover losses arising fromtheftorembezzlement. Political risk insuranceis a form of casualty insurance that can be taken out by businesses with operations in countries in which there is a risk thatrevolutionor otherpoliticalconditions could result in a loss.

WHAT IS LIFE INSURANCE ?

Life insurance may be defined as a contract in which the insurer, in consideration of a certain premium, either in a lump sum or by other periodical payments, agrees to pay the assured, or to the person for whose benefit the policy is taken, the assured sum of money, on the happening of a specified event contingent on the human life. Life insurance is a contract under which the insurer (Insurance Company) in consideration of a premium paid undertakes to pay a fixed sum of money on the death of the insured or on the expiry of a specified period of time Whichever is earlier. In case of life insurance, the payment for life insurance policy is certain. The Event insured against is sure to happen only the time of its happening is not known. So life insurance is known as Life Assurance. The subject matter of insurance is life of human being. Life insurance provides risk coverage to the life of a person. On death of the person insurance offers protection against loss of income and compensate the titleholders of the policy.ROLE OF LIFE INSURANCE: - Life insurance as an investment: Insurance products yield more than any other investment instruments and it also provides added incentives or bonus offered by insurance companies. Life insurance as risk cover:Insurance is all about risk cover and protection of life. Insurance provides a unique sense of security that no other forms of invest can provide. Life insurance as tax planning:Insurance serves as an excellent tax saving mechanism too.

IMPORTANCE OF LIFE INSURANCE: Protection against untimely death: Life insurance provides protection to the dependents of the life insured and the family of the assured in case of his untimely death. The dependents or family members get a fixed sum of money in case of death of the assured. Saving for old age: After retirement the earning capacity of a person reduces. Life insurance enables a person to enjoy peace of mind and a sense of security in his/her Promotion of savings: Life insurance encourages people to save money compulsorily. When life policy is taken, the assured is to pay premiums regularly to keep the policy in force and he cannot get back the premiums, only surrender value can be returned to him. In case of surrender of policy, the policyholder gets the surrendered value only after the expiry of duration of the policy. Initiates investments: Life Insurance Corporation encourages and mobilizes the public savings and canalizes the same in various investments for the economic development of the country. Life insurance is an important tool for the mobilization and investment of small savings. Credit worthiness: Life insurance policy can be used as a security to raise loans. It improves the credit worthiness of business. SocialSecurity: Life insurance is important for the society as a whole also. Life insurance enables a person to provide for education and marriage of children and for construction of house. It helps a person to make financial base for future. Tax Benefit: Under the Income Tax Act, premium paid is allowed as a deduction from the total income under section 80C.

Various types of life insurance policies Endowment policies: This type of policy covers risk for a specified period, and at the end of the maturity sum assured is paid back to policyholder with the bonuses during the term of the policy. Money back policies: This type of policy is for periodic payments of partial survival benefits during the term of the policy as long as the policy holder is alive. Group insurance: This type of insurance offers life insurance protection under group policies to various groups such as employers employees, professionals, co-operatives etc it also provides insurance coverage for people in certain approved occupations at the lowest possible premium cost. Term life insurance policies: This type of insurance covers risk only during the selected term period. If the policyholder survives the term, risk cover comes to an end. These types of policies are for those people who are unable to pay larger premium required for endowment and whole life policies. No surrender, loan or paid up values are in such policies. Whole life insurance policies: This type of policy runs as long as the policyholder is alive and is covered for the entire life of the policyholder. In this policy the insured amount and the bonus is payable only to nominee on the death of policyholder. Joint life insurance policies: These policies are similar to endowment policies in maturity benefits and risk cover, but joint life policies cover two lives simultaneously such as married couples. Sum assured is payable on the first death and again on the death of survival during the term of the policy. Pension plan: a pension plan or annuity is an investment over a certain number of years but does not provide any life insurance cover. It offers a guaranteed income either for a life or certain period. Unit linked insurance plan: ULIP is a kind of insurance plan, which provides life cover as well as return on premium paid over a certain period of time. The investment is denoted as units and represented by the value called as net asset value (NAV).Different distribution channels in India A multi-channel strategy is better suited for the Indian market. Indian insurance market is a combination of multiple markets. Each of the markets requires a different approach. Apart from geographical spread the sociocultural and economic segmentation of the market is very wide, exhibiting different traits and needs. Different multi-distribution channels in India are as follows: Agents: Agents are the primary channels for distribution of insurance. The public and private sector insurance companies have their branches in almost all parts of the country and have attracted local people to become their agents. Today's insurance agent has to know which product will appeal to the customer, and also know his competitor's products to be an effective salesman who can sell his company, the product, and himself to the customer. To the average customer, every new company is the same. Perceptions about the public sector companies are also cemented in his mind. So an insurance agent can play an important role to create a good image of company. Banks: Banks in India are all pervasive, especially the public sector banks. Many insurance companies are selling their products through banks. Companies, which are bank, owned, they are selling their products through their parent bank. The public sector banks, with their vast branch networks, are helpful to insurance companies. This channel of selling insurance is known as Bank assurance.

INSURANCE COMPANYASSOCIATE BANKS

SBI LifeState Bank of India, BNP Paribas

ICICI PrudentialICICI Bank, Bank of India, Citibank, Allahabad Bank, Federal Bank, South Indian Bank, Punjab and Maharashtra Cooperative Bank

Birla Sun LifeDeutsche Bank, Citibank, Bank of Rajasthan, Andhra Bank

ING Vysya BankVysya Bank

Aviva Life InsuranceABN Amro Bank, Canara Bank

HDFC Standard Life

HDFC Bank, Union Bank, Indian Bank

Met LifeKarnataka Bank, J&K Bank

Source: Hindu Business Line Brokers: Now a days different financial institution are selling insurance. These financial institutions are known as brokers. They are taking some underwriting charges from the insurance companies to sell their insurance products. Corporate agents: Corporate agency is a cross selling type of channel. Insurance companies tie-up with business houses in other industries to sell insurance either to their employees or their customers. Insurance industry, during the past 2 years has witnessed a number of such strategic tie-ups and alliances. Corporate agents have become a major force to reckon with in distributing insurance products. Such as- Bajaj Allianz tied up with Maruti Udyog and Ford for auto insurance and Tata AIG life has tied up with Tata tea, Khaitans Williamson major and bridge foundation for selling rural policies. Internet: In this technological world Internet is also a channel of selling insurance. This can be as direct marketing.

GENERAL INSURANCE

Insurance of the non-life assets are called general insurance, this includes loss of asset against water, fire, earthquake etc. With the opening up of the Indian Market in Insurance sector for private players, in General Insurance the monopoly of the general Insurance public sectors companies has been broken. With the entrance of the new private player market innovative technique has been introduced to capture the market. In general the private players have captured Insurance around 17% of the market. General Insurance is a sector, which alone has many type of insurance coverage in it like Fire Insurance, Marine Insurance, motor Insurance, Liability Insurance, Engineering Insurance etc.

INSURANCE PROVIDE:- Protection to investor. Accumulation of savings. Old age pensions Tax benefits

Functions of insurance: Provide Protection: The primary function of insurance is to provide protection against future risk, accidents and uncertainty. Insurance cannot check the happening of risk, but can certainly provide for the losses of risk. Insurance is actually a protection against economic loss, by sharing the risk with others. Collective bearing of risk: Insurance is an instrument to share the financial loss of few among many others. Insurance is a mean by which few losses are shared among larger number of people. All the insured contribute the premiums towards a fund and out of which the persons exposed to a particular risk is paid. Assessment of risk: Insurance determines the probable volume of risk by evaluating various factors that give rise to risk. Risk is the basis for determining the premium rate also. Provide certainty: Insurance is a device, which helps to change from uncertainty to certainty. Insurance is device whereby the uncertain risks may be made more certain. Small capital to cover larger risk: Insurance relieves the businessmen from security investments, by paying small amount of premium against larger risks and uncertainty. Contributes to wards the development of industries: Insurance provides development opportunity to those larger industries having more risks in their setting up. Even the financial institutions may be prepared to give credit to sick industrial units which have insured their assets including plant and machinery.

Means of savings and investment: Insurance serves as savings and investment, insurance is a compulsory way of savings and it restricts the unnecessary expenses by the insured's For the purpose of availing income-tax exemptions also, people invest in insurance. Source of earning foreign exchange: Insurance is an international business. The country can earn foreign exchange by way of issue of marine insurance policies and various other ways. Risk free trade: Insurance promotes exports insurance, which makes the foreign trade risk free with the help of different types of policies under marine insurance cover.

INDIAN INSURANCE INDUSTRY HISTORY The insurance sector in India has completed all the facets of competition from being an open competitive market to being nationalized and then getting back to the form of a liberalized market once again. The history of the insurance sector in India reveals that it has witnessed complete dynamism for the past two centuries approximately. Life insurance came to India from England in 1818 when oriental life insurance company started in Calcutta by Europeans. After this many insurance companies had been started in India. But these companies were looking after only the needs of European community established in India. These companies were not insuring Indian people. First Indian life insurance company came as Bombay mutual life insurance assurance. Second company was Bharat insurance company came in 1896. After this the united India in madras, national Indian and national insurance in Calcutta and the co-operative assurance in Lahore were established in 1906. To regulate Indian insurance business first insurance act came in 1912 as life insurance company act and provident fund act. These acts consist of premium rates tables and periodical valuations of companies. In the first two-decade of 20th century many life insurance companies were started. So the insurance act came in 1938 to governing life and non life insurance companies and to provide strict state control. In 1956 the life insurance business in India was nationalized. In 1956 life insurance corporation of India (LIC) was created to spreading life insurance much more widely particularly in rural areas. In that year LIC had 5 zonal offices, 33 divisional offices and 212 branch offices. In 1957 the business of LIC of sum assured of 200crores, 1000crores in 1970, and 7000crores in 1986.

Important milestones in the Indian life insurance business:

1912: The Indian Life Assurance Companies Act came into force for regulating the life insurance business. 1928: The Indian Insurance Companies Act was enacted for enabling the government to collect statistical information on both life and non-life insurance businesses. 1938: The earlier legislation consolidated the Insurance Act with the aim of safeguarding the interests of the insuring public

1956: 245 Indian and foreign insurers and provident societies were taken over by the central government and they got nationalized. An Act of Parliament, viz. LIC Act, 1956, formed LIC. It started off with a capital of Rs. 5 crore and that too from the Government of India.

Important milest ones in the Indian general insurance business:

1907: The Indian Mercantile Insurance Ltd. was set up which was the first company of its type to transact all general insurance business. 1957: General Insurance Council, an arm of the Insurance Association of India, framed a code of conduct for guaranteeing fair conduct and sound business patterns. 1968: The Insurance Act improved for regulating investments and set minimal solvency levels and the Tariff Advisory Committee was set up. 1972: The General Insurance Business (Nationalization) Act, 1972 nationalized the general insurance business in India. It was with effect from 1st January 1973. 107 insurers integrated and grouped into four companies viz. the National Insurance Company Ltd., the New India Assurance Company Ltd., the Oriental Insurance Company Ltd. and the United India Insurance Company Ltd. GIC was incorporated as a company.

INSURANCE REGULATORY DEVELOPMENT AUTHORITY (IRDA) In 1999, the Insurance Regulatory and Development Authority (IRDA) were constituted as an autonomous body to regulate and develop the insurance industry. The IRDA was incorporated as a statutory body in April 2000. The key objectives of the IRDA include promotion of competition so as to enhance customer satisfaction through increased consumer choice and lower premiums, while ensuring the financial security of the insurance market. The IRDA opened up the market in August 2000 with the invitation for application for registrations. Foreign companies were allowed ownership of up to 26%. The Authority has the power to frame regulations under Section 114A of the Insurance Act, 1938 and has from 2000 onwards framed various regulations ranging from registration of companies for carrying on insurance business to protection of policyholders interests.

ROLEOFIRDA Protecting the interests of policyholders. Establishing guidelines for the operations of insurers and brokers. Specifying the code of conduct, qualifications, and training for insurance intermediaries and agents. Promoting efficiency in the conduct of insurance business. Regulating the investment of funds by insurance companies. Specifying the percentage of business to be written by insurers in rural sectors. Handling disputes between insurers and insurance intermediaries.

Changing face of Indian insurance industry After the Insurance Regulatory and Development Authority Act have been passed there has been establishment of many private insurance companies in India. Previously there was a monopoly business for Life Insurance Corporation of India (L.I.C.) who was the only life-insurance company for the people till 2000. L.I.C. still holds 71.4% of the market share in 2006. But after the introduction of private life insurance companies there is a great competition in Indian market now. Everyone is trying to capture the fresh market here and penetrate it with aggressive marketing strategies. Today life-insurance is not only limited up to just life risk cover and maturity period bonuses but changed to greater return from the investments. With the introduction of the unit-linked insurance policies these companies are investing the money in different investment instruments like shares, bonds, debentures, government and other securities. People are demanding for higher returns with the life risk cover and private companies are giving 30-40% average growth per annum. These life-insurance companies have every kind of policies suiting every need right from financial needs of, marriage, giving birth and rearing up a child, his education, meeting daily financial needs of life, pension solutions after retirement. These companies have every aspects and needs of our life covered along with the death benefit. In India only 25% of the population has life insurance. So Indian life-insurance market is the target market of all the companies who either want to extend or diversify their business. To tap the Indian market there has been tie-ups between the major Indian companies with other International insurance companies to start up their business. The government of India has set up rules that no foreign insurance company can set up their business individually here and they have to tie up with an Indian company and this foreign insurance company can have an investment of only 24% of the total start-up investment.Indian insurance industry can be featured by: Low market penetration. Ever growing middle class component in population. Growth of customers interest with an increasing demand for better insurance products. Application of information technology for business. Rebate from government in the form of tax incentives to be insured. Today, the Indian life insurance industry has more than a dozen private players, each of which are making strides in raising awareness levels, introducing innovative products and increasing the penetration of life insurance in the vastly underinsured country. Several of private insurers have introduced attractive products to meet the needs of their target customers and in line with their business objectives. The success of their effort is that they have captured over 28% of premium income in five years. The biggest beneficiary of the competition among life insurers has been the customer. A wide range of products, customer focused service andprofessional advice has become the mainstay of the industry, and the Indian customers forms the pivot of each companys strategy. Penetration of life insurance is beginning to cut across socio-economic classes and attract people who have never purchased insurance before.

Life insurance is also now being regarded as a versatile financial planning tool. Apart from the traditional term and saving insurance policies, industry has seen the entry and growth of unit-linked products. This provides market linked returns and is among the most flexible policies available today for investment. Now products are priced, flexible, and realistic and sustain so people in better position to understand the risk and benefits of the product and they are accepting these innovative products.

So it is clear that the face of life insurance in India is changing, but with the changes come a host of challenges and it is only the credible players with a long term vision and a robust business strategy that will survive. Whatever the developments, the future and the opportunities in this industry will surely be exciting.

The number of companies in Insurance particularly in Life Insurance has changed drastically now the number is in 22. List of them are mentioned as below:-1. Bajaj Allianz Life Insurance 2. Birla Sun Life Insurance 3. HDFC Standard Life Insurance 4. ICICI Prudential Life Insurance 5. ING Vysya Life Insurance 6. Max New York Life Insurance 7. Met Life Insurance 8. Om Kotak Mahindra Life Insurance 9. SBI Life Insurance 10. TATA AIG Life Insurance 11. Reliance Life Insurance(AMP Sanmar AssuranceCo. Ltd.) 12. Dabur CGU Life Insurance 13. AVIVA Life Insurance 14. Sahara Life Insurance15. Shriram Life Insurance16. Bharti AXA Life Insurance 17. Future Generali Life 18. IDBI Forlis Life Insurance 19. Canara HSBC Oriental Bank Of Commerce 20. AEGON Religare Life Insurance 21. DLF Parameria Life Insurance 22. Star Union Dai-ichi Life InsurancePossibilities for insurance companies in India Further deregulation of the market. Greater concern for the customers. Newer products and services. Competition and quality consciousness. Cost effective operations. Restructuring of the public sector. Consolidation of domestic insurance markets. Technology driven shift in product design. Actual operations and distribution. Convergence of financial services.

OBJECTIVES

1. Proper understanding and analysis of life insurance industry.2. To know about brand awareness of SBI Life Insurance and customers preference about SBI Life Insurance.3. Conduct market survey on a sample selected from the entire population and derive opinion on that research.4. To offer suggestions based upon findings.5. To highlight historical background of Life insurance6. To examine the funds income and position of the Life insurance business of SBI life7. To analyse the need of customers according to they are financial and age status8. To provide interpretations and solutions to satisfy the need of customers.9. To study the various insurance plans of SBI life and suggest an appropriate plan to the customer.10. To conduct a need survey to know the openions of the customers from the market segment.

COMPANY PROFILE

SBI Life Insurance Company Ltd

SBI Life Insurance is a joint venture between State Bank of India and BNP Paribas Assurance SBI owns 74% of the total capital and BNP Paribas Assurance the remaining 26%. SBI Life Insurance has an authorized capital of Rs.2,000 crore and a paid up capital of Rs.1,000 crore. State Bank of India enjoys the largest banking franchise in India. Along with its 6 Associate Banks, State Bank Group has the unrivalled strength of over 16,000 branches across the country, arguably the largest in the world. BNP Paribas is the 1st largest French company and ranks 5th in the banking industry worldwide, 1st bank in Euro Zone as per Global 2000 Forbes 2008. It is 6th most valuable international banking brand as per Brand Finance 2008. BNP Paribas Assurance is the insurance arm of BNP Paribas - Euro Zones leading Bank. BNP Paribas, part of the worlds top 10 groups of banks by market value and part of Europe top 3 banking companies, is one of the oldest foreign banks with a presence in India dating back to 1860. BNP Paribas Assurance is the fourth largest life insurance company in France, and a worldwide leader in Creditor insurance products offering protection to over 50 million clients. BNP Paribas Assurance operates in 41 countries mainly through the Bancassurance and partnership model.

Multi-distribution Model SBI Life has a unique multi-distribution model encompassing vibrant Bancassurance, Retail Agency, Institutional Alliances and Corporate Solutions distribution channels. SBI Life extensively leverages the State Bank Group relationship as a platform for cross-selling insurance products along with its numerous banking product packages such as housing loans and personal loans. SBIs access to over 100 million accounts across the country provides a vibrant base for insurance penetration across every region and economic strata in the country, thus ensuring true financial inclusion. Agency Channel, comprising of the most productive force of over 68,000 Insurance Advisors, offers door-to-door insurance solutions to customers.OUR COMMITMENT

US Roy (MD&CEO) SBI Life Insurance Co.Ltd. Our company, with its unique brand and highly committed workforce, is determined to increase life insurance penetration and offer need-based solutions our citizens, enabling them to live life to the fullest. I invite you to explore the several possibilities available for being an integral part of this dream, of one of the fastest growing life insurance companies in the country.

For customers, SBI Life a company of State Bank Group which is synonymous with trust for more than 200 years presents security for you and your loved ones through its range of innovative life insurance solutions. With the backing of the largest distribution network in the country of over 14,500 bank branches of State Bank and nearly 200 full-service offices of the company, you are always close to your trusted life insurer.

For prospective business partners, by associating with one of the largest financial brands in the country, SBI Life gives you a lucrative business opportunity to profit from serving millions of Indians. In terms of career opportunities, SBI Life presents its most valuable asset, its employees, a work environment which is a blend of security and excellence.

We seek opportunities to give qualified minority suppliers a chance to succeed. It benefits SBI LIFE and our communities. US Roy(MD&CEO )SBI LIFE Insurance Co.Ltd

OurMission: "To emerge as the leading company offering a comprehensive range of life insurance and pension products at competitive prices, ensuring high standards of customer satisfaction and world class operating efficiency, and become a model life insurance company in India in the post liberalization period".

Our Values Trust worthiness Ambition Innovation Dynamism Excellence

Key MilestonesFinancial Year 08-09:

Bagged the coveted personal finance award-Outlook Money NDTV Profit best Life Insurer 2008. Ranked among global top three in terms of number of Million Dollar Round Table (MDRT) members. CRISIL has reaffirmed its highest financial rating AAA/Stable to SBI Life. In 2007 SBI Life became the first life insurer in India to receive this rating from CRISIL, countrys leading rating agency. Recently ICRA has assigned iAAA rating indicating highest claims paying ability to SBI Life Insurance. Retains ISO 9001:2000 certificate for superior claim settlement process.Financial Year 07-08:

Rated as the The Most Trusted Private Life Insurer according to a survey conducted by Brand Equity in association with AC Nielsen ORG-MARG and the Economic Times Intelligence Bureau. Became first life insurer in India to receive the highest financial rating AAA from CRISIL, the countries best known rating agency in 2007. Ranked amongst global top five life insurance companies in the number of MDRT members. Forayed into micro insurance with the launch of Grameen Shakti in Bhubaneswar, Orissa for the economically underprivileged sections of society. Received ISO 9001: 2000 certification for superior claim settlement process. Became the only domestic life insurer to achieve CMMI Level 3 certification for IT processes and software development capabilities.

Financial Year 06-07: Second consecutive year of Profitability. Leads Private Life Insurance Companies in Lives covered: 6.49 Million lives covered.Financial Year 05-06:

Becomes the first Life Insurer to make Profits.

BRANCHES OF SBI LIFE INSURANCE

PRODUCT PROFILE

UNIT LINKED PRODUCTS Horizon 11 Unit plus11 Unit plus child plan Unit Plan Elite Smart Ulip

PENSION PRODUCTS Horizon 11 Pension Unit Plus 11 Pensions Life long Pension Immediate Annuity

MONEY BACK SCHEME PRODUCTS Money Back Sanjeevan Supreme

PURE PROTECTION PRODUCTS Swadhan Shield Keyman

PROTECTION CUM SAVINGS PRODUCTS Sudarshan Scholarll Setubandhan

GROUP EMPLOYEE BENEFIT PRODUCTS

RETIREMENT SOLUTIONS Cap Assure Gratuity Cap Assure Super annuation Cap Assure Leave Encashment Group Immediate Annuity SBI Life Golden Gratuity

PROTECTION PLAN Sampoorn Suraksha SBI Life Group Term Life Scheme In Lieu of EDLI

SPECIALIZED TERM INSURANCE SBI Life Keyman Insurance

GROUP LOAN PROTECTION PRODUCTS

DHANA RAKSHA PLUS Dhana raksha Plus SP Dhana raksha plus LPPT Dhana raksha plus RP

GROUP SAVINGS PROTECTION PLAN Nidhi Raksha RP

GROUP MICRO INSURANCE Grameen Shakti and Super Suraksh

RESEARCH METHODOLOGY

COLLECTION OF DATA

Data constitutes the subject matter of analysis. One cannot draw inferences without analyzing data. The relevance, adequacy and reliability of data determine the quality of the study. Data is primarily of two kinds -1. Primary data2. Secondary data

1. Primary data The primary data are data, which are being collected by the researcher for the specific purpose of answering the problem on hand. Individual respondents, doctors, lecturers, jewelers, saloons were personally visited and interviewed. They were the main source of Primary data. The method of collection of primary data was direct personal interview through a structured questionnaire.2. Secondary data Literature study and the articles are obtaining secondary data from the Internet. The secondary data was collected on the basis of organizational file, official records, news papers, magazines, management books, preserved information in the companys database and website of the company.

SAMPLING PROCEDURE

Sampling methods

Probability sampling Non-probability sampling 1. Simple random method 1. Accidental sampling 2. Systematic sampling 2. Voluntary sampling 3. Stratified sampling 3. Purposive sampling 4. Cluster sampling 4. Quota sampling 5. Multi-stage sampling 5. Convenience sampling

Convenience sampling It is used in exploratory research where the researcher is interested in getting an inexpensive approximation of the truth. As the name implies, the sample is selected because they are convenient. This non-probability method is often used during preliminary research efforts to get a gross estimate of the results, without incurring the cost or time required to select a random sample.SAMPLE DESIGN A procedure or plan drawn up before any data is collected to obtain a sample from a given population. It is also known as sampling plan or survey design.

DATA ANALYSIS AND INTERPRETATION

Q1. Are you aware about SBI Life Insurance?

75% people aware about SBI Life Insurance.

25% people not aware about SBI Life Insurance.

Q2. Do you have any account in SBI Bank?

30% people have account in SBI Bank. 70% people dont have account in SBI Bank.

Q3(A). Do you have any investment plans of SBI Life Insurance?

37% people have investment plans of SBI Life Insurance like Unit Plus III,Smart ULIP, Pension Plan and Child Plan. 63% people not have investment plans of SBI Life Insurance.

Q 3(B). Are you satisfied with the plans of SBI Life?

83% people are satisfied with the plans of SBI Life due to Effective services, Guarantee, good brand image,nice features,attractive plans, etc. 17% people are not satisfied with the plans of SBI Life due to block of money.

4. Have you invested in any other life insurance company other than SBI Life?

80% people have already invested in other Life Insurance company like LIC, ICICI, Reliance Life Insurance, Bajaj Life Insurance and Birla Life Insurance. 20% people not invested in any other Life insurance company.

5. Do you want to take any investment plan of SBI Life if you find it better?

87% people want to take investment plan of SBI Life when they find it better. 13% people dont want to take investment plan of SBI Life even when they find it better.

6. What do you think are the benefits of Life Insurance?

17% People thought that Covers future uncertainty is the benefit of Life Insurance. 13% People thought Tax Saving as benefit of Life Insurance. 3% People thought Investment as benefit of Life Insurance. 67% People thought all the above as benefit of Life Insurance.

7. Which feature of Life Insurance policy will you consider while buying?

0% people judge investment plans with premium. 14% people judge investment plans with Guarantee. 14% people judge investment plans with Returns. 6% people judge investment plans with Brand Image. 66% people judge investment plans with above all features.

8. According to you, what is the right age to buy insurance?

10% People thought less than 25 years is the right age to buy insurance. 50% People thought 25 35 years is the right age. 17% People thought 35- 45 years is the right age 17% People thought > 45 years is the right age. 6% People thought one can buy insurance at Anytime.

comparison icici prudential cash back plan vs sbi life insurance money back

ICICI Prudential Life Insurance Co. Ltd ICICI Prudential Life Insurance Company is a leading life insurance company of India. The company was formed after a joint venture between ICICI Bank and Prudential plc, a financial services... Life Insurance:MoneyBack Plan:Cash Back Life Insurance:Protection Plan:Home Assure Loan cover term insurance,Life Guard Return of Premium,Life Guard Single Premium Life Insurance:Retirement Plan:Forever Life,Premier Life Pension,Life Stage Pension,Life Time Super Pension,Immediate Annuity Life Insurance:ULIP Plan: InvestShield Life New,LifeTime Gold,LifeStage RP,InvestShield CashBak,LifeLink Super,LifeStage Assure,PremierLife Gold Life Insurance:Children Plan:SmartKid New Unit-linked,SmartKid Regular Premium Life Insurance:Investment Plan:Save n Protect

SBI Life Insurance Co. Ltd SBI Life Insurance is one of the leading life insurers in India. It is a joint venture between the State Bank of India (SBI) and BNP Paribas Assurance based in France. SBI owns 74% of the total... Life Insurance:MoneyBack Plan:SBI - Money Back,Sbi Life - Sanjeevan Supreme Life Insurance:Children Plan:SBI Life - Unit Plus Child Plan,SBI Life - Scholar II Life Insurance:ULIP Plan:SBI Life - Unit Plus Elite Plan,SBI Life - Horizon II,SBI Life - Unit Plus II Life Insurance:Investment Plan:SBI Life - Sudarshan (Endowment) Life Insurance:Retirement Plan:SBI Life - Unit Plus II,SBI Life - Horizon II,SBI Life - Immediate Annuity,SBI Life - Lifelong Pensions Life Insurance:Protection Plan:SBI Shield,SBI Swadhan

CONCLUSION During the data collected, it has been found that people have great awareness about SBI Life Insurance. People are beginning to look beyond LIC for their insurance needs and are willing to trust private players with their hard earned money. People in general have been influenced by the marketing activities of insurance companies. A high penetration of print, radio and TV ad campaigns over the years is beginning to have its impact now. Another important trend was in terms of people viewing insurance as a tax saving and investment instrument as much as protective one. The general satisfaction levels among public with regards to policy and agents still requires improvement. Here lies the opportunity for a relatively new comer like SBI Life Insurance. LIC has never been known for prompt service or customer oriented methods but SBI Life Insurance can build its reputation based on these factors. 37% out of 75% people those who are aware about SBI Life Insurance have investment plans of it. 25% people not aware about SBI Life Insurance, hence they invested in other Life Insurance Company. 83% out of 37% people those who have SBI Life Insurance investment plans are very satisfied with these plans because of good services, returns, guarantee, brand image, premium, nice features, attractive plans etc. 70% of the people those who dont have account in SBI Bank think that they cant take investment plans of SBI Life Isurance. 67% People thought that Covers future uncertainty, tax saving and investment are some of the benefits of Life Insurance

People are interested in those plans that give maximum profit in short term.

SUGGESTIONS & RECOMMENDATIONS Marketing in terms of the media via advertisements on Television to small commercials on FM, hoardings and signage etc. has to be made because there were respondents who havent even heard about SBI Life Insurance. Awareness camp for sub-urban area should be focused. State and Central Government employees should be targeted because of reasons like: They dont have Life Insurance cover other than that provided by their respective employers and LIC. Most of them are underinsured. They have a stable source of income and social security. SBI Life Insurance must build its reputation by focusing on service quality. Better service quality. Better service quality may be in the form: Issuing policy in time. Providing claims in time. Making customers aware about their status of policy. SBI Life Insurance must introduce such kind of policies which will give maximum profits in short term period.

WEBLOGRAPHY

WEBSITESwww.sbilifeinsurance.com www.sbibank.com

ANNEXUREQUESTIONNAIRETo find out the perception of the persons about SBILife InsuranceDear Respondent We the student of BNN college, are conducting an analysis on SBI Life Insurance plans and products. We were highly appreciated and also will be thankful if you could help us by providing your valuable remarks on following questions.We assure you of confidentiality of the input you provide to us.Name of Respondent: __________________________________________Age: _________________________________________________________ Address: ____________________________________________________Contact No.: __________________________________________________Q 1. Are you aware about SBI Life Insurance? Yes NO Q 2. Do you have any account in SBI Bank? Yes NO

Q 3(A). Do you have any investment plans of SBI Life Insurance? Yes NO If yes then mention the plan name:

Q 3(B). Are you satisfied with the plans of SBI Life? Yes NO If yes then why? ______________________________________________________________

Q 4. Have you invested in any other life insurance company other than SBI Life? Yes NO If yes then mention the company name:

Q 5. Do you want to take any investment plan of SBI Life if you find it Better? Yes NO

Q 6. What do you think are the benefits of Life Insurance? Covers future uncertainty Tax Savings Investments All Q 7. Which feature of Life Insurance policy will you consider while buying? Premium Guarantee Returns Brand Name All Q 8. According to you, what is the right age to buy insurance? < 25 Years 25-30 Years 35-45 Years > 45 Years Any Time

Q 9. Feedback & Suggestions for SBI Life? __________________________________________________________________ __________________________________________________________________________

Top of FormBottom of Form

Page 55