SURVEY AND DEMAND LIFE INSURANCE OF INDIA

INTRODUCTION

Insurance is a term which means a form of agreement or contract. Its actually a

protection against a loss for which we pay certain amount of money periodically in
exchange for a guarantee that we will be compensated under stipulated conditions for any
specified loss by fire, accident, death, etc. in other words we can say that a system to
make large financial losses more affordable by pooling the risks of many individuals and
business entities and transferring them to an insurance company or other large group in
return for a premium. When we talk about insurance the first thing comes in our mind is
the loss. So to compensate that loss, we pay a nominal charge to any institution, which is
known as premium and the guarantee which we receive from that particular institution is
known as insurance. It may be described as a social device to reduce or eliminate the risk
of loss to life and property. Insurance is a collective bearing of risk. Insurance is a scheme
of economic cooperation by which the members of the community share the unavoidable
risks. The risks which can be insured against include fire, deaths, accidents and burglary.
It cant prevent the occurrence of risk but it provides for the losses of risks. Insurance can
be defines as a legal contract between two parties whereby one party called the insurer
undertakes to pay a fixed amount of money on the happening of a particular event, which
may be certain or uncertain. The party called the insured pays in exchange a fixed sum
known as premium. The document which embodies the contract is called the policy.

The history of insurance in India can be traced back to the Vedas. The Sanskrit term
YOGAKSHEMA, the name of Life Insurance Corporation of Indias corporate
headquarters, is found in the Rig Veda. Some form of community insurance was
practiced by the Aryans around 1000 BC. The joint family system prevalent in India was
an important form of social cooperation. Insurance is a federal subject in India and has a
history dating back to 1818 with the establishment of the Oriental Life Insurance
Company in Calcutta. All the insurance companies established during that period were
brought up with the purpose of looking after the needs of European community and these
companies were not insuring Indian natives. However, later with the efforts of eminent
people like Babu Muttylal Seal, the foreign life insurance companies started insuring
Indian lives. But Indian lives were being treated as sub-standard lives and heavy extra
premiums were being charged on them. Bombay Mutual Life Assurance Society, the birth
of first Indian life insurance company in the year 1870, and covered Indian lives at
normal rates. Starting as Indian enterprise with highly patriotic motives, insurance
companies came into existence to carry the message of insurance and social security

1
through insurance to various sectors of society. The Swadeshi Movement of 1905-07 and
many more movement of this time led to an increase in number of insurance companies.
In 1912 the first legislation regulating insurance, the Life Insurance Companies Act,
1912, was promulgated. The Insurance Act, 1938, the first comprehensive legislation
governing both life and non life branches of insurance was enacted to provide strict state
control over the insurance business. By the mid 1950s, there were 154 Indian insurers, 16
foreign insurers and 75 provident societies carrying on life insurance business in India.
Insurance business flourished and so did scams, irregularities, and dubious investments
practices by scores of companies. As a result, the govt. decided to nationalize the life
assurance business in India. The Life Insurance Corporation of India was set up in 1956
to take over 245 companies. The General Insurance Corporation of India was set up in
1973. Right now there are several insurance companies in India. Some of the top
companies are:
1. Life Insurance Corporation of India.
2. ICICI
3. Bajaj Allianz Life Insurance Company Limited
4. SBI Life Insurance Company Limited
5. SBI Life Insurance Co Ltd
6. Reliance Life Insurance Company Ltd
7. HDFC Standard Life Insurance Company Limited
8. Birla Sun Life Insurance Company Ltd
9. Max New York Life Insurance Company Ltd

OBJECTIVES OF THE STUDY

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 To know the demand of the life insurance policies
To know why people are taking the life insurance policies.
To know the LIC providing any securities to the people.
To know the benefits of LIC for giving this policies.
To know the benefits by taking this policies.
To know the purpose why people are very interested to take the policies.
To identify the time limit for this insurance policies.
To recognize if people are satisfying with this life insurance policy.

NEED OF THE STUDY

The need for this study is how this life insurance policies playing a role in Indian
economy.

3
 To giving this life insurance policies how the people are feeling security.
By studying this we can improve the life insurance services.
How people are thinking to get this policies in a procedural way.
By studying this we need to no the how life insurance sector help to growth for the Indian
economy.

SCOPE OF THE STUDY

This life insurance policies giving securities to them and there families.
So many people are very interested to take the policies for more than three.
They want more securities for this insurance sector
The people need more services from this life insurance .
This insurance policies giving more benefits the people.

4
 INDUSTRY PROFILE (FINANCIAL SERVICES)
Financial Services

A. Consumer Finance
The segment primarily comprises companies providing personal loans, indirect financing,
including lease and sales financing, credit cards issuers, pawn shops and pay day loan providers.
The segment excludes companies dealing in mortgage lending. Companies under this
classification provide unsecured loans to individuals for both commercial and personal purposes.
They operate in the subprime category and provide loans to individuals with bad credit history.
This feature differentiates them from other banks and credit unions.

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 B. Capital Markets
Establishments in this segment undertake activities, including trading, brokerage,
strategic advisory, portfolio management, asset management and investment advice. They
primarily work as intermediaries, either to provide or manage capital, thereby satisfying financial
goals of institutions and individuals. Companies operating under the segment can broadly be
classified into three distinct categories. The first set includes investment banking and brokerage
companies that provide services, such as underwriting of bonds and stocks to raise capital,
trading and broking of stocks, bonds, derivatives and commodities, as well as companies
engaged in strategic advisory services. The second set comprises asset management firms,
including companies that professionally manage large pools of money from individuals and
institutions with an aim to satisfy a common investment goal. Firms under this sub-segment
manage various funds, such as open-ended, closed-ended, unit investment trusts and face
certificates. The third set includes companies classified as diversified capital markets, which
provide more than two services and drive a majority of their revenues collectively from both of
them with no significant proportion coming from only one service.

C. Banking
Banking is composed of three different subfields including commercial banks, savings
banks, and credit unions. Commercial banks represent the largest portion of the industry. Not
only do these banks save and invest money but also are involved in international trading and
lending. Savings banks primarily serve their clients in lending and saving of money. Both
commercial and savings banks are regulated and overseen by one of the 12 Federal Reserve
districts and the FOMC.

Banks are required under regulation to hold a percentage of deposits as required reserves
equal to the federal funds rate. Excess reserves beyond the required reserve rate are used by
banks in investment opportunities, loans, mortgages, or exchanged among banks that are in need
of reserves. The difference between commercial banks and savings banks is seen in the types of
clients and consumers they do transactions with and the amount of services they provide. People
that in one way or another had a "bond", such as members of a labor union, originally created
credit unions, today anyone can join a credit union.

D. The Foreign Exchange Market (ForEx)

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 Bloomberg and its competitors all follow the foreign exchange market closely for their
clients. The foreign exchange market (forex) is simply the market in where currencies from all
over the world are traded. The forex market is the largest financial market in the world. The
forex market see's over $2 trillion in daily trades. This market, with the help of companies such
as Bloomberg, is expected to grow rapidly as businesses become more aware and informed. The
forex market involves the buying of one currency from all over the world, while at the same time
selling another. As global currencies are valued against one another buyers look for currencies on
the rise and try to sell those that are weak. As one might assume, the most often traded currencies
are the U.S. Dollar, the Euro, the British Pound, the Swiss Franc, and the Japanese Yen.

E. Investment Services
The investment service industry involves the investment of money into securities. These
securities include stocks, bonds, or mutual funds. Securities are bought and sold daily on the
market by investment service agencies for clients all over the world.

F. Insurance
The insurance business involves insurance carriers, brokerages and agencies. Insurance
companies charge premiums to cover the risks of their clients. The premium that the insurance
company charges is based directly on the likelihood that a client will suffer a financial loss. The
insurance companies use formulas and algorithms to determine the risk of their clients. Insurance
companies use underwriters to measure risk and price the policy accordingly. The premiums that
customers pay are invested in order to build a strong portfolio to cover client losses. Life
insurance, property and casualty insurance, reinsurance, health insurance, and liability insurance
are the main fields within the insurance industry.

G. Diversified Financial Services

This segment includes establishments engaged in providing financial services, such as
financial advisory firms, investment research companies, stock exchanges and credit rating
companies. Many companies involved in a variety of diversified financial activities, such as
banking, insurance, financial advisory, but not particularly dominant in one line of business are
classified under this category as well. Another set of companies in this segment have operations
in a specialized business line, such as stock and commodity exchanges, credit agencies, and
investment research and investment advisory companies. For these companies, a majority of their
revenue is derived from one particular area of expertise and specialized activity.

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Business Environment in the Industry

The financial services industry has been severely impacted by difficult conditions in the
U.S. housing market, leading to a global credit crisis. This crisis has led to tectonic changes to
the face of this industry, having long-term impacts on business models. Even before the credit
crisis escalated, the industry faced major setbacks, such as declining profitability, mounting non-
current loans and loan loss provisions, rising delinquency rates and increasing foreclosures.
These factors have resulted in the increase in credit card defaults as card provider companies
have started reducing credit limits to minimize bad debt outstanding.

The nature of M&As has also changed significantly with the rise of distressed M&A
activities as the liquidity crunch deepens and the credit market tightens.

COMPANY PROFILE OF LIFE INSURANCE CORPORATION OFINDIA

Life Insurance Corporation (India) (LIC) is an Indian state-owned insurance group and
investment company headquartered in Mumbai. It is the largest insurance company in India with
an estimated asset value of 1560482 crores (US$230 billion). As of 2013 it had total life fund
of Rs.1433103.14 crore with total value of policies sold of 367.82 lakh that year.

The Life Insurance Corporation of India was founded in 1956 when the Parliament of
India passed the Life Insurance of India Act that nationalised the private insurance industry in
India. Over 245 insurance companies and provident societies were merged to create the state
owned Life Insurance Corporation

Mission

"Ensure and enhance the quality of life of people through financial security by providing
products and services of aspired attributes with competitive returns, and by rendering resources
for economic development."

Vision

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 "A trans-nationally competitive financial conglomerate of significance to societies and
Pride 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.

Conduct business with utmost economy and with the full realization that the moneys
belong to the policyholders.

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.

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.

Employees and agents

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 As on 31 March 2016, LIC has 1,20,388 employees, out of which 24,867 were women
(20.65%).

Category of employees Total Number No. of Women

Class-I Officers 31,420 6,297

Class-II Development Officers 26,621 1,033

Class III/IV employees 62,347 17,542

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Organizational Structure of LIC of India

The Life Insurance Corporation Act, 1956 gives broadly the pattern of itsorganization

Board of Directors

Shri S. K. Roy (Chairman, LIC of India)

Shri V K Sharma (Managing Director, LIC of India)

Smt Usha Sangwan(Managing Director, LIC of India)

Shri Shaktikanta Das

Smt. SnehlataShrivastava

Shri Ashwani Kumar (CMD, Dena Bank)

THEORETICAL FRAMEWORK

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Life Insurance

A life insurance policy is a contract with an insurance company. In exchange for premium
payments, the insurance company provides a lump-sum payment, known as a death benefit, to
beneficiaries upon the insured's death.

Typically, life insurance is chosen based on the needs and goals of the owner. Term life
insurance generally provides protection for a set period of time, while permanent insurance, such
as whole and universal life, provides lifetime coverage. It's important to note that death benefits
from all types of life insurance are generally income tax-free

There are many varieties of life insurance. Some of the more common types are discussed
below.

A. Term Life Insurance

Term life insurance is designed to provide financial protection for a specific period of
time, such as 10 or 20 years. With traditional term insurance, the premium payment amount stays
the same for the coverage period you select. After that period, policies may offer continued
coverage, usually at a substantially higher premium payment rate. Term life insurance is
generally less expensive than permanent life insurance.

Term life insurance proceeds can be used to replace lost potential income during working
years. This can provide a safety net for your beneficiaries and can also help ensure the family's
financial goals will still be metgoals like paying off a mortgage, keeping a business running,
and paying for college.It's important to note that, although term life can be used to replace lost
potential income, life insurance benefits are paid at one time in a lump sum, not in regular
payments like pay checks.

B. Universal life insurance

Universal life insurance is a type of permanent life insurance designed to provide lifetime
coverage. Unlike whole life insurance, universal life insurance policies are flexible and may
allow you to raise or lower your premium payment or coverage amounts throughout your
lifetime. Additionally, due to its lifetime coverage, universal life typically has higher premium
payments than term.

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 Universal life insurance is most often used as part of a flexible estate planning strategy to
help preserve wealth to be transferred to beneficiaries. Another common use is long term income
replacement, where the need extends beyond working years. Some universal life insurance
product designs focus on providing both death benefit coverage and building cash value while
others focus on providing guaranteed death benefit coverage.

C. Whole life insurance

Whole life insurance is a type of permanent life insurance designed to provide lifetime
coverage. Because of the lifetime coverage period, whole life usually has higher premium
payments than term life. Policy premium payments are typically fixed, and, unlike term, whole
life has a cash value, which functions as a savings component and may accumulate tax-deferred
over time.

Comparing Types of Life Insurance

Term Life Universal Life Insurance Whole Life

Insurance Insurance

Needs it helps Income Wealth transfer, income Wealth transfer,

meet replacement during protection and some preservation and, tax-
working years designs focus on tax- deferred wealth
deferred wealth accumulation
accumulation

Protection Designed for a specific Flexible; generally, for a For a lifetime

period period (usually a number lifetime
of years)

Cost Typically, less expensive Generally, more expensive Generally, more

differences than permanent than term expensive than term

Premiums Typically, fixed Flexible Typically, fixed

Proceeds paid Yes, generally income Yes, generally income tax- Yes, generally income
to beneficiaries tax-free free tax-free

Investment No No No
options

DATA ANALYSIS AND INTERPRETATION

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1.Are you insured?

TABLE:

S. no particulars respondents Percentage

1 Yes 39 78
2 no 11 22
total 50 100

CHART:

120

100

80

60 respondents
Percentage
40

20

0
Yes no total

INTERPRETATION:

From the survey it is observed that Among 50 respondents 78% of people are interested
to insure,22% of people are not interested .

2. If no, what do you think is the reason?

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TABLE:

s. no particulars respondents Percentage

1 Not interest 8 16
2 Does not understand 37 74
3 Forgot 5 10
total 50 100

CHART:

120
100
80
60
40
20 respondents
Percentage
0

INTERPRETATION:

From the survey it is observed that Among 50 respondents, 16% of not

interest and 74% of does not understand and 10% of forgot in insurance policy.

15
 3. Do you choose any alternatives to this?

TABLE:

S. no particulars respondents percentage

1 yes 10 20
2 No 24 48
3 Sometimes 16 32
total 50 100

CHART:

120

100

80

60 respondents
percentage
40

20

0
yes No Sometimes total

16
INTERPRETATION:

From the survey it is observed that Among 50 respondents ,20% of people

choose alternatives and 48 % of people dont choose and 32% of sometimes choose the
alternatives in life insurance policy.

4. By concerning whom you have taken insurance policy?

TABLE;

S. no Particulars Respondents percentage

1 Family 33 66
2 Relatives 16 32
3 Others 1 2
total 50 100

CHART:

17
 120

100

80

60 Respondents
percentage
40

20

0
Family Relatives Others total

INTERPRETATION:

From the survey it is observed that Among 50 respondents ,66% of taken for family
and 32% of taken for relatives and for others 2% take insurance.

5. Do you think it is useful to you?

TABLE:

S. no Particulars respondents Percentage

1 yes 33 66
2 No 17 34
total 50 100

CHART:

18
 120

100

80

60 respondents
Percentage
40

20

0
yes No total

INTERPRETATION:

From the survey it is observed that Among 50 respondents , 66% of people think it is
usefull and 34% of people it is not usefull.

6. Do you know the benefits of your insurance policy?

TABLE:

S. no particulars respondents percentage

1 yes 47 94
2 No 3 6
Total 50 100

CHART:

19
 120

100

80

60 respondents
percentage
40

20

0
yes No Total

INTERPRETATION:

From the survey it is observed that Among 50 respondents 94% of people think it
gives benefits and 6% of people think it is not usefull.

7. Have you taken insurance to your family members?

TABLE:

S. no Particulars Respondents Percentage

1 Yes 20 40
2 No 30 60
Total 50 100

CHART:

20
 120

100

80

60 Respondents
Percentage
40

20

0
Yes No total

INTERPRETATION:

From the survey it is observed that Among 50 respondents ,40% people taken
insurance to families and 60 % of people are not taken to there families.

8. Who influenced you to get insured?

TABLE:

S. no Particulars Respondents percentage

1 Advertisement 8 16
2 parents 30 60
3 friends 12 24
total 50 100

CHART:

21
 120

100

80

60 Respondents
percentage
40

20

0
Advertisement parents friends total

INTERPRETATIONS:

From the survey it is observed that Among 50 respondents ,16% people influenced
by advertisements and 60% are influenced by parents and 24 % are influenced by friends to get
insurance.

9. How many life insurance policies you have?

TABLE:

S. no Particulars Respondents Percentage

1 one 18 36
2 Two 27 54
3 Three 5 10
4 None 0 0
Total 50 100

CHART:

22
 120

100

80

60 Respondents
Percentage
40

20

0
one Two Three None Total

INTERPRETATION:

From the survey it is observed that Among 50 respondents ,36 % of people have
taken One insurance policy,54% of people taken two policies,10% of people are taken three
policies.

10. which of the following policies you have?

TABLE:

S. no Particulars Respondents Percentage

1 Health insurance 11 22
2 Vehicle insurance 9 18
3 Life insurance 27 54
4 Fire insurance 3 6
Total 50 100

CHART:

23
 120

100

80

60

40
Respondents
20 Percentage

INTERPRETATIONS:

From the survey it is observed that Among 50 respondents ,22 % of take health
insurance and 18 % of take vehicle insurance and 54 % of take life insurance and 6 % of take
fire insurance.

11. Have you received survival benefits so for against money back policy?

TABLE:

S. no Particulars Respondents Percentage

1 yes 31 62
2 No 19 38
total 50 100

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CHART:

120

100

80

60 Respondents
Percentage
40

20

0
yes No total

INTERPRETATION:

From the survey it is observed that Among 50 respondents ,62 % of yes and 38 % is
No . insurance received survival benefits to insurance policy.

12. If yes, how many times you have received it ?

TABLE:

S. no Particulars Respondents Percentage

1 1 22 44
2 2 23 46
3 3(or)more 5 10
total 50 100

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CHART:

120

100

80

60 Respondents
Percentage
40

20

0
1 2 3(or)more total

INTERPRETATIONS:

From the survey it is observed that Among 50 respondents ,44 % of received one
time and 46 % of received two times and 10 % of 3 or more times insurance.

13. Are you aware about life insurance claims?

TABLE:

S. no Particulars Respondents Particulars

1 yes 29 58
2 No 21 42
Total 50 100

CHART:

26
 120

100

80

60 Respondents
Particulars
40

20

0
yes No Total

INTERPRETATION:

From the survey it is observed that Among 50 respondents ,58 % of

people aware about life insurance claims and 42 % people are not aware life insurance policy.

27
 FINDINGS
The78% of people are very interested to take the life insurance policy.
The people taking this life insurance policy for the security of life.
The most of the people are taking this life insurance policy for their families.
This insurance policies are very useful in people perception.
This life insurance policies giving many benefits to the insury.
So many people are not interested to take the policies.
Some people are dont know about this life insurance policies.
There are no available branches in some urban places.
There is no proper advertising techniques for motivate the people to insure.
This life insurance policy show the more security than other insurance services.

SUGGESTIONS

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 This LIC employees has to motivate the people how this insurance policies make helpful
to there life.
The LIC should have to give more securities and benefits to the people.
The LIC has to provide more branches and more employees in all places and regions.
The LIC has to show the other financial services that are coming with this life insurance
policies.
The LIC is to increase the more money for who are taking the insurance.
To increase the popularity of this life insurance policies it has to use promotional
techniques and advertisements.
The LIC has to secure the families also who are going to insured.
This LIC has to improve more techniques to improve the demand of the life insurance.

CONCLUSION

The study of the demand of life insurance policy conclude that the many
people are secured with this insurances and also people are showing securities to there
families this life insurance policies make sure that there are more benefits to the people
who are going to take the life insurance policies. And does the LIC is going to improve
there insurance policies.

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 BIBILOGRAPHY

Howard, J. C. "Quakenbush pushed on Holocaust claims (Insurance Commissioner

Chuck Quakenbush, old claims)". National Underwriter Life & Health - Financial
Services 101, no.45(November 10, 1997): 38+.
Jennings, John. "Holocaust survivors hit insurers with suit (class action lawsuit accuses
eight European insurance firms of failure to honor policies)". National Underwriter Life
& Health - Financial Services 101, no.14(April 7, 1997): 1+.
Quackenbush shocked by access to Generali files". Underwriters' Report(January 29,
1998):

30
 SURVEY ON DEMAND OF LIFE INSURANCE POLICY
I M. KALYANI PURSUING M.B.A IN GVR&S COLLEGE OF
ENGINEERING&TECHNOLOGY.AS PART OF ACADEMIC CURRICULUM I AM
CONDUCTING SURVEY ON DEMAND OF LIFE INSURANCE POLICY.

SO YOU ARE INVITED TO PARTICIPATE IN OUR SURVEY.

NAME: GENDER:

MOBILE NO:

OCCUPATION: AGE:

1. Are you insured?

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 A. Yes B. No

*If no skip to 2-3.

2. If no, what do you think is the reason?

A. Not interested B. Does not understand C. Forgot

3. Do you choose any alternatives to this?

A. Yes B. No C. Sometimes

* If YESskip to 4-7

4. why you are insurance ? ______________________________________________

____________________________________________________

5. By concerning whom you have taken insurance policy?

A. Family B. Relatives C. Others

6. Do you think it is useful to you?

A. Yes B. No

7. Do you know the benefits of your insurance policy ?

A. Yes B. No

8. Have you taken insurance to your family members ?

A. Yes B. No

9. Who influenced you to get insured?

A. Advertisement B. Parents C. Friends

10. How many life insurance policies you have?

A. One B. Two C. Three D. None

11. Which of the following policies you have?

A. Health insurance B. Vehicle insurance

C. Life insurance D. Fire insurance

12. Have you received survival benefits so for against money back policy?

A. Yes B. No

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13. If Yes, How many times you have received it?

A.1 B.2 C. 3(or)more

14. Are you aware about life insurance claims?

A. Yes B .No

15. Give you any suggestions ?

THANKYOU

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