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Life Insurance policy of Pragati Life Insurance Ltd.

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Letter of Transmittal
October 23, 2014
Sheikh Imran Akand Shuvo
Course Instructor
Collage of Business Administration
FIN-404 Management of Insurance Business

Dear Sir,
It is really a pleasure to be associated with Pragati Life Insurance Ltd. We are trying to make a
report on Life Insurance policies of Pragati Life Insurance Ltd. to make the higher service
level toward the development of quality of service.
This study was designed to analyze the scheme of life insurance for the employee. This report
All details of the policies.
Highlight the salient features of polices.
Identify the conditions applied in the contract
We have collect all the relevant information required for the successful completion of our report.
It may be mentioned here that the data and information collected cannot represent the overall
Information Technology scenario. Besides, in the report we have focused on the different terms
and in the field of marketing to make my report more effective and attractive for the respective
readers. Most of the data is collected by the primary data with a survey of close ended questions.
Some secondary data is collected from different documents like financial report, Internet and
official website of Pragati Life Insurance Ltd.
We would like to mention that due to lack of sufficient knowledge, there might be some errors
and mistakes in my report. I am, however, hopeful that you will pardon me considering the fact
that we are still within a learning process.
Sincerely your
Group: Kuddus


Mohammad Ahsan Ullah
Jannatul Ferdous
Nasrin Akter
Jesmin Khandaker
Anupam Das


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Students Declaration
We would like to declare that we have completed our report of Life Insurance policies of pragati
life insurance ltd. is fulfill the partial requirements of Bachelors of Business Administration

-----------------Jesmin Khandaker (Group Leader)

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At first I would like to express my gratefulness to the almighty Allah for being so kind to allow
me to work on this report successively.
Then, I would like to express my gratitude to IUBAT International University of Business
Agriculture and technology where I have finished my required course curriculum to be eligible to
prepare a research paper. The education learnt from the teachers and the whole infrastructure of
my university, truly has amplified my level of competency and thoughts during my learning
I would like to show my gratitude to Honorable Course Instructor and Faculty Sheikh Imran
Akand Shuvo for giving us the permission to do our report as well as for helping us by giving
relevant guideline to prepare this report and for their remarkable talents and valuable
contributions, brilliance, wise counsel, unique insights, perspective and dedication.

In the preparation and finish this proposal, we acknowledge the encouragement and assistance
given by a number of people and institutions.

We would like to express our regards to our entire group members for providing us detailed
cooperation and suggestion on this report.

On behalf of Kuddus Group

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Executive Summary
The development of a country depends up on the consolidate development of all infrastructures
like-agricultural sector, industrial sector, financial sector, technological sector etc. But
developing all these structures is not easy. A lot of troubles and threats always hinder and make
difficulties to success. The most difficult problem is financial risk. So if it is feasible to provide
financial protection then most of the structural development will be achievable with minimal
efforts. And the most well-known practical method for handling financial risk is insurance.
Pragati Life Insurance Company Limited was incorporated in November 10, 1986 and is mainly
engaged in Ordinary Life (OL), Group Insurance (GI), Health Insurance (HI) business and nontraditional micro insurance business under the name of (GN-GRB). The Company is a publicly
traded Company and its shares are listed on the Dhaka Stock Exchange and Chittagong Stock
However, I have prepared this report on Pragati Life Insurance Ltd, which is one of the growing
and prospective insurance companies in the insurance industry. The company is providing
protection and financial security to the nation, whilst adding shareholders value thought
customer service excellence. By the way of examining and evaluation the functions and
performance of Pragati Life Insurance Co. Ltd, I tried to illustrate a true scenario of insurance
industry of Bangladesh.
The most important part of this report is the findings and analysis that means what I have found
out throughout my study. My report topic is Overall Activities Pragati Life Insurance Co. Lid.
So, get an accurate realization about Pragati Life Insurance Ltd. I also made an effort to present
some Suggestions for the better interest of the company.
Basically, the major problems and facilities are similar for all insurance company as they are
dealing with services. The difference can be made in one way, which is how well they are
maintained their Accounts and dealing with their customer and most probably how efficiently
and effectively they are operating their business. Pragati Life Insurance Company business
started with the creation of product or service and ended with the attempt to sell it. Pragati Life

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should start with the knowledge of the market. So, it is necessary to find out what is needed,
what will be sold, only then should return the operation to create the product or service.

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1.1 Background:
This term project was prepared for fulfilling the requirement of FIN-404 Insurance. The work
started as assigned by the honorable Course Instructor. It took about one month to finish the
1.2 Objectives:
The objectives of the term project were:
To understand the Life Insurance policies of Pragati Life Insurance Ltd. and matching it with the
theoretical concepts of the course
1. To identify the policy strategies of Pragati Life Insurance Ltd.
2. To identify a problem in performance evaluation system and recommend strategies for
the improvement, which will strengthen the companys overall effectiveness for serving
its objectives.
1.3 Scope:
The scope of the term project was limited to analyze the performance appraisal system at Pragati
Life Insurance Ltd. and recommend restructuring measures for improvement of the system.
1.4 Limitation:
The limited time given for the term project was a major limitation. The company set the
condition that they would not provide some confidential information. The lower level employees
of the company were not available for interviews while doing the research.
1.5 Methodology:
Primarily interview of employees of Pragati Life Insurance Limited was conducted to know the
Secondary data was analyzed to gain further understanding of the performance appraisal system
of Pragati Life Insurance Ltd. Service rule was extensively used throughout the term project
since it provided both validity and credibility.
1.6 Sources of information:
Sources of primary data: interviews with different Top and mid-level managers at Pragati Life
Insurance Ltd.

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Sources of secondary data: service rule and other documents of the organization, industry
journals, web sites, etc.
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.
Life Insurance is of great importance to individuals, groups, business community and general
Some of the main benefits of life insurance are given below;
3.1 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.
3.2 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 old age.
3.3 Promotion of savings
Life insurance encourages people to save money compulsorily. When a 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.
3.4 Initiates investments
Life Insurance Corporation encourages and mobilizes the public savings and channelizes 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.
3.5 Credit worthiness

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Life insurance policy can be used as a security to raise loans. It improves the credit worthiness of
3.6 Social Security
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.
3.7 Tax Benefit
Under the Income Tax Act, premium paid is allowed as a deduction from the total income under
section 80C.

4. Type of Policies
In case of Term assurance plans, insurance company promises the insured for a nominal
premium to pay the face value mentioned in the policy in case he is no longer alive during the
term of the policy.
Term assurance policy has the following features;
Policies are short-term plans and the term ranges from one year onwards. If the
policyholder survives till the end of this period, the risk cover lapses and no insurance
benefit payment is made to him.
The amount of premium to be paid for these policies is lower than all other life insurance
policies. As savings and reserves are not accumulated under this policy, it has no
surrender value and loan or paid-up values are not allowed on these policies.
This plan is most suitable for those who are initially unable to pay high premium
When income is low as required for Whole Life or Endowment policies, but requires life
cover for a high amount.
This policy runs for the whole life of the assured. The sum assured becomes payable to the legal
heir only after the death of the assured. The whole life policy can be of three types.
Ordinary whole life policy In this case premium is payable periodical throughout the life of
the assured.
Limited payment whole life policy In this case premium is payable for a specified period
(Say 20 Years or 25 Years) Only.
Single Premium whole life policy In this type of policy the entire premium is payable in one
single payment.

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In this policy the insurer agrees to pay the assured or his nominees a specified sum of money on
his death or on the maturity of the policy whichever is earlier. The premium for endowment
policy is comparatively higher than that of the whole life policy. The premium is payable till the
maturity of the policy or until the death of the assured whichever is earlier. It provides protection
to the family against the untimely death of the assured.
An individual is subject to uncertainty regarding his health. He may suffer from ailments,
diseases, disability caused by stroke or accident, etc. For serious cases the person may have to be
hospitalized and intensive medical care has to be provided which can be very expensive. It is
here that medical insurance is helpful in reducing the financial burden. These days the
vulnerability to lifestyle diseases such as heart, cancer, neurotic, and pollution based, etc are on
the increase. So it makes sense for an individual to go for medical insurance cover.
This policy is taken on the lives of two or more persons simultaneously. Under this policy the
sum assured becomes payable on the death of any one of those who have taken the joint life
policy. The sum assured will be paid to the survivor(s). For example, a joint life policy may be
taken on the lives of husband and wife, sum assured will be payable to the survivor on the death
of the spouse.
Under with profit policy the assured is paid, in addition to the sum assured, a share in the profits
of the insurer in the form of bonus. Without profit policy is a policy under which the assured
does not get any share in the profits earned by the insurer and gets only the sum assured on the
maturity of the policy. With profit and without profit policies are also known as participating and
non participating policies respectively.
This policy provides that if the insured person dies of any accident, his beneficiaries will get
double the amount of the sum assured.
Under this policy, the sum assured is payable not in one lump sum payment but in monthly,
quarterly and half-yearly or yearly installments after the assured attains a certain age. This policy
is useful to those who want to have a regular income after the expiry of a certain period e.g. after
retirement. Annuity is paid so long as the assured survives. In annuity policy medical checkup is
not required. Annuity is paid so long as the assured survives.

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Women, now a days are free to take life assurance policies. However, some specially designed
policies suit their needs in a unique manner; the synopsis of some these policies are as follows;

Jeevan Sathi is also known a Life Partner plan where the husband and wife are covered
under this endowment policy, which gives the following benefits;

On maturity, provided both are alive, full sum assured with bonus is paid.
On the death of one of the assured during the period of the policy, basic sum assured is
paid to the surviving partner, who is not required to pay any further premiums.
III. The surviving partner remains covered for the full sum assured. If she/he dies, then the
sum assured is paid to the nominee, but this is before the maturity date.
IV. The surviving partner will be paid sum assured with bonuses if he survives till the
maturity date. Hence this policy gives a comprehensive family protection.
Jeevan Sukanya is highlighted by the following points;

Only female child aged between 1 to 12 years is covered in this plan.

Band is automatically covered under the policy after marriage.
Risk of the child starts either after 2 years of taking the policy or not before the age of 7,
whichever is early.
Premium paying period is 20 years minus age at entry.
On surviving the age of 20, the life assured receives the sum assured as survival benefit
and the policy continues to cover the life assured till maturity date when vested bonus
will be paid only. If life assured dies before maturity, sum assured with bonuses will be


Group life insurance is a plan of insurance under which the lives of many persons are covered
under one life insurance policy. However, the insurance on each life is independent of that on the
other lives. Usually, in group insurance, the employer secures a group policy for the benefit of
his employees. Insurer provides coverage for many people under single contract.
Policies for children are meant for the various needs of the children such as education, marriage,
security of life etc. Some of the major children policies are:
i. Childrens deferred assurances
ii. Marriage endowment and educational annuity plans
iii. Children endowment policy

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In this case policy money is paid to the insured in a number of separate cash payments. Insurer
gives periodic payments of survival benefit at fixed intervals during the term of policy as long as
the policyholder is alive.

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Pragati Life Insurance Limited was established on January 30, 2000 as a public limited company
under the Companies Act, 1994 with the philosophy of maintaining competitiveness, balanced
with prudent management and fairness to all policyholders. The company obtained registration
from the Department of Insurance on April 11, 2000 under the Insurance Act, 1938 to carry out
insurance business. The Company started with a paid up capital of Tk.30 million against an
authorized capital of Tk. 250 million. Now the present paid up capital stands to Tk. 84 milion.
Pragati Life has been sponsored by some renowned business entrepreneurs of the country linked
with different industrial groups. Went for public issue in 2005 and are listed in both Dhaka Stock
Exchange Limited and Chittagong Stock Exchange Limited. Pragati Life was established with
the vision of participating effectively in the process of providing financial security to the clients
as well as to facilitate creation of long term capital in the market. Pragati Life, in the process of
materializing its vision, has been developing new customer oriented and innovative products
developed by its own Actuarial Department. Within a short span of time, the Company has
created a franchise value in the market by expanding its business network with a diversied
product line throughout the country.
Pragati Life has re-insurance agreement with world's largest reinsurer-Munich Reinsurance
Company, Germany since its inception.
Pragati Life is also the rst insurance company in Bangladesh providing status of policies
through Push-Pull (SMS) service for its policyholders. Policyholders of the company can also
know their policy details from its website.
6. Vision
They will be recognized as the leader among all life insurance companies in Bangladesh.
They will always apply high standards of integrity and responsibility in their activities.
Their success will be built on their absolute dedication to the satisfaction of their policyholders,
through constant innovation, operational efficiency, prompt services, cost effectiveness and the
talents of their people.
7. Mission
Their mission is to produce and provide quality and innovative insurance product. Maintain
stringently ethical standard in business operation. Ensuring benefit to the policyholders,
shareholders and the society at large.
8. Corporate Focus
company imbibed with good governance practices.




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9. Board of Directors:

10. Product Line:

PLIL is the only insurance company in Bangladesh, simultaneously marketing four major lines
of insurance since inception, namely
1. Individual Product Line-deals with insurance policies of individual persons & their
special needs.
2. Pragati Bima Division (Insurance for low income group)-deals with individual policies
of low-income group people on monthly premium basis.
3. Group Insurance-deals with insurance coverage for the employees of
corporate/institutional lives at a very low cost.
4. Health Insurance-deals with hospitalization insurance coverage of both individual &
employees of different organizations.

11. Pragati Life Insurance Policies

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