Overview The Life Insurance Corporation of India (LIC) is the largest state-owned life insurance company in India, and

also the country's largest investor. It is fully owned by the Government of India. It also funds close to 24.6% of the Indian Government's expenses. It has assets estimated of 9.31 trillion (US$206.68 billion). It was founded in 1956 with the merger of more than 200 insurance companies and provident societies. Headquartered in Mumbai, financial and commercial capital of India, the Life Insurance Corporation of India currently has 8 zonal Offices and 101 divisional offices located in different parts of India, at least 2048 branches located in different cities and towns of India along with satellite Offices attached to about some 50 Branches, and has a network of around 1.2 million agents for soliciting life insurance business from the public. History The Oriental Life Insurance Company, the first corporate entity in India offering life insurance coverage, was established in Calcutta in 1818 by Bipin Bernard Dasgupta and others. Europeans in India were its primary target market, and it charged Indians heftier premiums. The Bombay Mutual Life Assurance Society, formed in 1870, was the first native insurance provider. Other insurance companies established in the pre independence era included Bharat Insurance Company (1896) Hindustan Co-operatives (1907) United India (1906) Indian Mercantile National Indian (1906) General Assurance National Insurance (1906) Swadeshi Life (later Bombay Life) Co-operative Assurance (1906) Indias first 150 years were marked mostly by turbulent economic conditions. It witnessed, First War of Independence, adverse effects of the World War I and World War II on the economy of India, and in between them the period of world wide economic crises triggered by the Great depression. The first half of the 20th century also saw a heightened struggle for India's independence. The aggregate effect of these events led to a high rate of bankruptcies and liquidation of life insurance companies in India. This had adversely affected the faith of the general public in the utility of obtaining life cover. The Life Insurance Act and the Provident Fund Act were passed in 1912, providing the first regulatory mechanisms in the Life Insurance industry. The Indian Insurance Companies Act of 1928 authorized the government to obtain statistical information from companies operating in both life and nonlife insurance areas. The subsequent Insurance Act of 1938 brought stricter state control over an industry that had seen several financially unsound ventures fail. A bill was also introduced in the Legislative Assembly in 1944 to nationalize the insurance industry. Some of the important milestones in the life insurance business in India: 1818 : Oriental Life Insurance Company, the first life insurance company on Indian soil started functioning. 1870 : Bombay Mutual Life Assurance Society, the first Indian life insurance company started its business. 1912 : The Indian Life Assurance Companies Act enacted as the first statute to regulate the life insurance business. 1928 : The Indian Insurance Companies Act enacted to enable the government to collect statistical information about both life and non-life insurance businesses. 1938 : Earlier legislation consolidated and amended to by the Insurance Act with the objective of protecting the interests of the insuring public. 1956 : 245 Indian and foreign insurers and provident societies are taken over by the central government and nationalised. LIC formed by an Act of Parliament, viz. LIC Act, 1956, with a capital contribution of Rs. 5 crore from the Government of India. The General insurance business in India, on the other hand, can trace its roots to the Triton Insurance Company Ltd., the first general insurance company established in the year 1850 in Calcutta by the British.
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Some of the important milestones in the general insurance business in India: 1907 : The Indian Mercantile Insurance Ltd. set up, the first company to transact all classes of general insurance business. 1957 : General Insurance Council, a wing of the Insurance Association of India, frames a code of conduct for ensuring fair conduct and sound business practices. 1968 : The Insurance Act amended to regulate investments and set minimum solvency margins and the Tariff Advisory Committee set up. 1972 : The General Insurance Business (Nationalisation) Act, 1972 nationalised the general insurance business in India with effect from 1st January 1973. 107 insurers amalgamated 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 incorporated as a company. Nationalization In 1955, parliamentarian Amol Barate raised the matter of insurance fraud by owners of private insurance companies. In the ensuing investigations, one of India's wealthiest businessmen, Ram Kishan Dalmia, owner of the Times of India newspaper, was sent to prison for two years. Eventually, the Parliament of India passed the Life Insurance of India Act on 1956-06-19, and the Life Insurance Corporation of India was created on 1956-09-01, by consolidating the life insurance business of 245 private life insurers and other entities offering life insurance services. Nationalization of the life insurance business in India was a result of the Industrial Policy Resolution of 1956, which had created a policy framework for extending state control over at least seventeen sectors of the economy, including the life insurance. SPREAD IN THE COUNTRY Over its existence of around 50 years, Life Insurance Corporation of India, which commanded a monopoly of soliciting and selling life insurance in India, created huge surpluses, and contributed around 7 % of India's GDP in 2006. The Corporation, which started its business with around 300 offices, 5.6 million policies and a corpus of INR 459 million (US$ 92 million as per the 1959 exchange rate of roughly Rs. 5 for a US $ , has grown to 25000 servicing around 180 million policies and a corpus of over 8 trillion (US$177.6 billion). The recent Economic Times Brand Equity Survey rated LIC as the No. 1 Service Brand of the Country. The slogan of LIC is "Zindagi ke saath bhi, Zindagi ke baad bhi"in hindi. In english it means "with life also,after life also. According to The Brand Trust Report 2011, LIC is the 8th most trusted brand of India OBJECTIVES Spread Life Insurance widely and in particular to the rural areas and to the socially and economically backward classes with a view to reaching all insurable persons in the country and providing them adequate financial cover against death at a reasonable cost. Maximize mobilization of people's savings by making insurance-linked savings adequately attractive. Bear in mind, in the investment of funds, the primary obligation to its policyholders, whose money it holds in trust, without losing sight of the interest of the community as a whole; the funds to be deployed to the best advantage of the investors as well as the community as a whole, keeping in view national priorities and obligations of attractive return. Conduct business with utmost economy and with the full realization that the moneys belong to the policyholders. Act as trustees of the insured public in their individual and collective capacities Meet the various life insurance needs of the community that would arise in the changing social and economic environment. Involve all people working in the Corporation to the best of their capability in furthering the interests of the insured public by providing efficient service with courtesy. Promote amongst all agents and employees of the Corporation a sense of participation, pride and job satisfaction through discharge of their duties with dedication towards achievement of Corporate Objective.
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BRIEF OVERVIEW OF SCHEMES OF LIC LIC GROUP PLAN | GROUP GRATUITY SCHEME | LIC | OVERVIEW | ADVANTAGES | BENEFITS TAX BENEFIT | FEATURES SPECIAL FEATURES Key to a successful business is keeping your employees motivated. Happy and secured employees work better, which in turn reduces the employers tension. Group Insurance is an insurance which covers a group of people (like employees of a common employer or professionals in a common group). LIC brings you LICs GRATUITY PLUS PLAN, a unit linked plan for management of Gratuity Funds. This plan is different from the traditional Cash Accumulation Plan as the returns under the Plan are linked to the performance of the chosen fund. GRATUITY PLUS PLAN is suitable for companies who desire to entrust Gratuity Fund management to an insurer and wish to have the flexibility of choice of investments. ADVANTAGES 1. Choice of 4 funds to meet various risk appetites. 2. Flexibility in structuring the Gratuity Costs based on performance of Fund. 3. Facility of Switching between various funds. One switch every year is free of cost. 4. It provides for life insurance cover at a very minimal cost. Cover can be equal to the gratuity payable for anticipated service. Alternatively, the company can also choose for each member a uniform level of cover equal to a minimum of one months salary or more . 5. There is no bid offer spread under this scheme. 6. Scheme can be surrendered at any time. There is no surrender penalty imposed. 7. Hassle Free Administration of Scheme 8. Assistance for execution of legal documents and installation of scheme. BENEFITS 1. Gratuity Benefits to Members whenever payable as per Rules of the Scheme shall be paid to the Policy Holder by debiting the requisite no of units to the Policy Holders Unit Account at NAV applicable at that time. 2. In case of death of member, life insurance cover as opted for by Policyholder will also be paid by the Corporation. 3. The policy can be surrendered at any time. The benefit available on surrender of the policy will be the value of total number of units held in the Policy Holders Unit Account at the time of surrender. At all times the Policyholders unit account should be sufficient to cover the relevant charges and benefits payable at such point of time, subject to a minimum balance of Rs. Five lacs in the Policyholders Unit Account. In case the Policyholders Unit Account falls below this limit, the policy shall compulsorily be terminated and the balance amount in the policy holders Unit Account will be refunded to the policy holder. TAX BENEFITS: The provisions relating to the approved Superannuation Scheme are set out in Part B of the Fourth Scheme of the Income-Tax Act, 1961 and Part XIII of the Income Tax Rules, 1962. The income tax concession will be available only if the scheme is approved by the CIT. 1. The annual contribution is treated as a deductible business expense in term of Section 36(1) (IV) of the I.T. Act. 2. In terms of a Notification issued by the Central Board of Direct Taxes .80% of the contribution (s) towards the past service liability are treated as deductible business expenses spread over in the subsequent years of payment. 3. The employees contribution, in the case of the Contributions scheme qualifies for exemption under Section 80C of the Income-Tax Act. Jeevan Anurag Benefits LICs Jeevan Anurag is a with profits plan specifically designed to take care of the educational needs of children. The plan can be taken by a parent on his or her own life. Benefits under the plan are payable at prespecified durations irrespective of whether the Life Assured survives to the end of the policy term or dies
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during the term of the policy. In addition, this plan also provides for an immediate payment of Basic Sum Assured amount on death of the Life Assured during the term of the policy. Assured Benefit Payment of 20% of the Basic Sum Assured at the start of every year during last 3 policy years before maturity. At maturity, 40% of the Basic Sum Assured along with reversionary bonuses declared from time to time on full Sum Assured for the full term and the Terminal bonus, if any shall be payable. For example, if term of the policy is 20 years, 20% of the Sum assured will be payable at the end of the 17th,18th, 19 th year and 40% of the Sum Assured along with the reversionary bonuses and the terminal bonus, if any, at the end of the 20th year. Death Benefit Payment of an amount equal to Sum Assured under the basic plan immediately on the death of the life assured. DETAILS OF WHOLE LIFE SCHEME AND ENDOWMENT SCHEME Summary: Jeevan Anand is the combination of Endowment Assurance and Whole Life plan. The risk cover will continue even after the maturity, that means Zindagi Ke Saath Bhi Zindagi Ke Bad Bhi Jeevan Anand plan no. 149 provides financial protection against death throughout the lifetime of the life assured with the provision of payment of a lump sum at the end of the selected term in case of his survival. For Example: Mr. Pankaj, age 25 years, takes Jeevan Anand policy for 25 years for Sum Assured Rs. 1 lakh. Now on Maturity Pankaj will receive Rs. 2,12,500/- (Rs. 1 lakh sum assured Plus Rs.1,12,500/- is the estimated bonus at Rs.45/- per thousand per year.) In case, Mr. Pankaj, dies ( After premium paying term is over) at the age of 60 years, his nominee will get additional Rs. 1 lakh equal to sum assured amount. Since Mr. Pankaj has already received the bonus, LIC will not pay second time bonus. In case, Mr. Pankaj dies during the Premium Paying Term, his nominee will get Rs.1 Lakh (sum Assured) + Accrued bonus till Mr. Pankajs death. Key Features: 1. Jeevan Anand is the combination of Whole Life and Endowment Assurance plan. 2. Even after the Premium Paying Term (PPT) is over, risk cover continues till the death of the policy holder. 3. Accident Benefit is available during the Premium paying term and thereafter upto age 70. 4. Limited premium payments. 5. Double accidental cover upto age 70. 6. Tax Savings Modes of Premium Payment: You can pay premium yearly, half-yearly, quarterly, monthly or through salary deductions as opted by you throughout the selected term of the policy or till earlier death. Jeevan Anand Plan Premiums are limited. You only pay till the selected term of years or until death if it occurs during the term period. This policy not only makes provisions for the family of the life assured in the event of early death but also assures a lump sum at a desired age. The lump sum can be reinvested to provide an annuity during the remainder of policy holders life or in any other way considered suitable at that time. Premium Stoppage: If payment of premiums ceases after at least 3 years premiums have been paid, a free paid-up policy for a reduced sum assured will be automatically secured provided the reduced sum assured, exclusive of any attached bonus, is not less than Rs. 250/-. The reduced sum assured will become payable on the event as stipulated in the policy. Bonuses : Jeevan Anand is a with-profit insurance plan and participates in the profits of the Corporations life insurance business. You will get the profit in the form of Bonuses.
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Simple Reversionary Bonuses are declared per thousand Sum Assured annually at the end of each financial year. Once the bonus is declared, they form part of the guaranteed benefits of the plan. Bonuses will be added during the selected term or till death, if it occurs earlier. Final (Additional) Bonus may also be payable provided the policy has run for certain minimum period. Maturity Benefit: Sum Assured along with all vested bonuses payable at the end of the term to the policy holder.(Endowment term) Death Benefit : Sum Assured along with vested bonuses are payable on death during the premium paying term. An amount equal to the Sum Assured is payable if death occurs after the premium paying term. Simple Reversionary Bonus accrues during the premium paying term and is payable at the end of the premium paying term or on earlier death along with final additional bonus, if any. No Bonus is paid on death after the premium paying term. Accident Benefit: Double Accident Benefit is available during the premium paying term and thereafter up to age 70. Maximum Accident Cover available under this plan will be Rs 5 lakh (this limit excludes accident benefit taken under other plans). In case of permanent disability of the life assured due to accident this additional Sum assured is payable in instalments. Eligibility Conditions and Restrictions: a) Minimum Entry Age: 18 Years completed f) Minimum Sum Assured: Rs. 1,00,000/b) Maximum Entry Age: 65 Years g) Maximum Sum Assured: No Limit c) Max. PPT Mat. Age: 75 years h) Risk cover: Sum Assured + Bonus d) Min. Premium term: 5 yrs i) Loan on policy: Available e) Max Premium term: 57 yrs j) Housing loan : Available Surrender Value: Buying a life insurance contract is a long-term commitment. However, surrender values are available on the plan on earlier termination of the contract. Guaranteed Surrender Value: The policy may be surrendered after it has been in force for 3 years or more. The guaranteed surrender value is 30% of the basic premiums paid excluding the first years premium. Any extra premium(s) paid and premium(s) towards Accident Benefit are also excluded. LICs policy on surrenders: In practice, the Corporation will pay a Special Surrender Value which is either equal to or more than the Guaranteed Surrender Value. The benefit payable on surrender reflects the discounted value of the reduced claim amount that would be payable on death or at maturity. This value will depend on the duration for which premiums have been paid and the policy duration at the date of surrender. In some circumstances, in case of early termination of the policy, the surrender value payable may be less than the total premium paid. Who should buy Jeevan Anand policy? Since Jeevan Anand is an endowment assurance plus whole life policy, this plan is apt for people of of all ages and social groups who wish to protect their families from a financial setback that may occur owing to their demise. The amount assured if not paid by reason of his death earlier will payable at the end of the endowment term where it can be invested in an annuity provision for the rest of the policyholders life or in any other way he may think most suitable at that time REASONS WHY LIC IS A MARKET LEADER IN LIFE INSURANCE SECTOR Positions: 1. Largest insurance Company in the world in Customer Base (23 crore customers) 2. No.1 insurance company in the world in terms of agency (about 1.1 Million agents)
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3. LIC is No.1 insurer in the world in Volume & Sold around 3.75 Cr.Policies in 2007- 2008. 4. 2nd Biggest Real Estate Owner next to Indian Railways. 5. LIC is one of the Highest income tax playing Organization. For Financial Year 2007- 08, LIC has paid advance Tax Rs.2627. 14 Cr. & Service Tax Rs.1292. 15 Cr. 6. Has Highest insurance Professionals ( Club Member agents ) 7. Only 4 countries in the world have more population that LIC`s policy holders. Award Recognition : 8. Adjudged "The most trusted service Brand" in India, by "Economic Times and AC NEILSEN ORG MARG" for the year 2007 for the 5th consecutive year. 9. "Golden Peacock" award for Excellence in "corporate Governance" 10.LIC adjudged as "Best life insurance Company of the year" at the "2nd"NDTV Profit Business Leadership Awards-2007. 11.LIC adjudged the "Most Preferred Li fe insurance Company of the year" at the "CNBC AWAAZ" consumer award 2007 for 3rd time in succession. 12.Awarded Reader Digest's "Trusted Brand"2006,2007&2008 (Voted by Consumers) 13. "Outlook Money NDTV Profit Award 2007" 14. "Web 18-Genius of the web Award" Conferred for the best website in insurance Category 15. "SKOCH Challengers Award 2008" for "Jeevan Madhur". 16. "Loyalty Awards 2008"- insurance Sector. 17. Double crown for LIC in corporate Olympics 2008, Most Sporting Corporate Championship Award Winner-2008 Honouring of the Commitment - Settlement of Claims 18.No.1 insurance Company in the world in terms of claims paid. 19.LIC Settles 2.21 claims per second, LIC settled 139 lakhs claims during the year 2007-2008. 20.Prompt settlement of claims (97% maturity claim settled on or before due date) 21.One of the Lowest outstanding Claim Ratio in the world ( Maturity+S B Claim- 0.07%) Advanced Technology-For better Customer Service 22.Computerized and networked 2048 branch offices and 159 satellite offices throughout the country. 23.Use of High Tech-WAN,LAN,IVRS & EDMS 24.LIC is second largest PC user in the country. 25.EDMS to make LIC a paperless office- Enabling Policy servicing & payments through all branchs in the country. 26. Premium Payment Facility extended through networked 2048 branches, ECS, ATM's through internet, online portals, collecting bank (Axis Bank), AP online, through SMS, through selected agents, Now LIC Premium can also be paid through. "Suvidha info Serve KIOSKS" all over India. 27.Policy Holder's Portal allow on line access to policy status and other details. 28.Info centre set up in 12 cities for customers to interact easily. Dial- 1251 for details. 29.45 interactive Voice Response System (IVRS) centers all over the country to provide information on policy servicing. Facility is available 24 7, Facility can be availed on following phone Nos. 1251 OR 02025514248. Social Strength 30.LIC - an institution builder promoting many financial and insurance institutes like NSE, NCDEX, LIC Mutual Fund, Stock Holding Corporation of India, National insurance Academy, insurance institute of India etc. 31.LIC has foreign operations in Mauritius, Fiji and London and has joizt venture operating in Sri lanka, Nepal, Bahrain & Saudi Arabia. New offices will be hortly oprned in Australia, USA&Canada. 32.LIC is known as "Pension Provider" of the country. 33.1st Pension company in India is floated by LIC as "LIC Pension Fund Ltd" on 21st Nov 2007. 34.First to create waves in micro insurance sector by insuring people below the poverty
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line. In year 2007-2008, 8.54 lac policies sold through "Jeevan Madhur"Plan. 35.Widest range of plans (about 48) for every need of the customer of 0 to 79 years of age. 36.Biggest Portfolio of Group insurance schemes available. 37."Jeevan Saral" one of the product of LIC got "Best innovation product " award from I.R.D.A. 38.LIC has covered lick Risk of 1.13 crore citizens through "AAM ADMI BIMA YOJANA" & " JANASHREE BIMA YOJANA". 39.Very Unique Salary saving Portfolio. 40.Highest Number of Corporate Clients in Group insurance Scheme. 41.Expending Distribution Channel through Bancassurances, Corporate Agencies, Broker ship & Chief Life insurarance Advisor (CLIA). 42. New East - Central Zonal Office opened at patina to caterto the needs of states of Bihar, Jharkhand and Orissa. 5 new Divisional offices were also opened in 2007-08. Pune D.O.was splited in 2 divisions, viz Pune Division (i) and Pune Division (ii). 43. "Golden Jubilee Foundations" established for undertaking charitable activities like education, health, relief of poverty etc. People's Money for People's Welfare 44.LIC invested more than 11,630 crores, in infrastructure sector is Rs.56,691 crores 45.In socially oriented sector like water, drainage & housing etc, LIC has invested Rs.5,635 crores during 2007-08 & total investment in this sector is Rs.32,321 crores. 46.Total investment in Social Sector Rs.89,000 Crs. 47.Different incentive schemes for villages, Schools and Banks under Bima Gram, Bima School and Bima Banks. 48.Total investment in Nation Building Activities is 5,76,000 Crs. Financial Strengths 49.LIC's investment income in 2007-08 was Rs.40,655 crores. Out of Total income of Rs, 1,76,559.28 Crs. 50.Total Assets of the corporation as on 31.3.07 were Rs. 6,74,514.78 Crs. 51.Largest institutional investor in Share Market. On an average Rs.100 crore invested every day. During theyear 2007 LIC earned the profit Rs.10,000 Crs. from the Sale of Equity. 52. Largest Financial institutional investor both Equity market & Term House. KEY ACHIEVEMENTS During the 2008/09 financial year, LIC sold more than 35.9 million policies generating a first year premium income of Rs. 52,953.92 crore (US$ 11 billion) despite the global slowdown (Source: IRDA). During this period, the corporation settled 577,000 death claims and 1.44 million maturity claims.To its resounding credit, the Corporation was able to settle 97% of all maturity claims on or before the due date signing out Rs. 29,105.85 crore (US$ 6.10 billion) in settlement. Additionally, the corporation paid Rs. 5606.90 crore (U S$ 1.20 billion) in death claims. Current figures show the outstanding claims ratio under the death category at no more than 2.20% and in the maturity segment at an exemplary low of 0.26%. LIC has a proud record of innovative products that find instant acceptance and success. For example, the Corporations Jeevan Aastha scheme, a close-ended, singlepremium plan sold about 1.84 million policies collecting Rs.10,664 crore (US$ 2.20 billion) in premiums in 45 days of launch in the year 2009. It is a remarkable achievement that not only has LIC continued to maintain the trust of consumers during the economic downturn but has also been felicitated with several awards. It was bestowed the Readers Digest Trusted Brand Platinum Award, in both 2008 and 2009, the CNBC Awaaz Consumer Award in 2009 and the Customer and Brand Loyalty Award in 2009. In the same year, LIC emerged as the Top Brand in the Insurance Category in the survey conducted by ACNielsen for Brand Equity. In fact, Brand Equity rated LIC as the Most Trusted Service Brand, five years in a row. In the recent past, too, its brand leadership has been on evidence. In 2008, for instance amongst several awards, LIC was felicitated with the NDTV-Profit Business Leadership award as also the Asia Brand Congress- Brand Leadership Award. Even in the field of technology, LICs innovations and practices were recognized when it won the NASSCOM Award for the Best IT User
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