Professional Documents
Culture Documents
Chapter One
INTRODUCTION
Also, a company analysis looks into the goods and services proffered by the company. If
the company is involved in manufacturing activities, the analysis studies the products produced
by the company and also analyzes the demand and quality of these products. Conversely, if it is a
service business, the investor studies the services put forward.
The primary step is to determine the type of analysis which would work best for your
company.
Research well about the methods for analysis. In order to perform a company analysis, it
is important to understand the expected outcome for doing so. The analysis should
provide answer about what is done right and wrong on the basis of a thorough
evaluation. It is, therefore, important6 to make the right choice for the analysis methods.
The next step involves implementing the selected method for conducting the financial
analysis. It is important for the analysis to include internal and external factors affecting
the business.
1
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
As a next step, all the major findings should be supported by use of statistics.
The final step involves reviewing the results. The weaknesses are then attempted to be
corrected. The company analysis is used in concluding issues and determining the
possible solutions. The company analysis is conducted to provide a picture of the
company at a specific time, thus providing the best way of enhancing a company,
internally as well as externally.
Subsections of Analysis
The overall corporate quality of a company can be evaluated by studying the business's
core elements, functions and operations. For example, a company may manufacture products of
impeccable quality but have a disreputable customer service history. As such, a total company
analysis may be broken down into smaller, related analyses of different aspects of the company.
When all the reports from the various analysis are used together, the big picture of the
corporation's health is formed.
2
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Internal Analysis
When analysis is conducted internally by a business's management, the results can help in
identifying problems and in remedying a situation. Even if a business seems to be performing
well, a company analysis sometimes identifies practices and processes that may be tweaked to
enhance performance. When performance is more efficient, its associated costs go down and the
profit margins go up. In large companies with completely separated departments, a company
analysis may prove that processes currently practiced in one department may work equally well
in another department. A timely conducted analysis may also inspire innovation to gain market
share.
External Analysis
When used by external parties, a company analysis answers the questions that an investor
may have about the company. Investors may make use of a SWOT (strength, weakness,
opportunity, threat) analysis to better understand the company's current position in its industry,
probable position in the near and long-term future and to make educated decisions about
engaging in business with the company. SWOT analysis may be particularly helpful when
reviewing businesses operating in markets that are demographically, culturally and economically
different.
Ratio Analysis
3
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Frequency
4
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Industry Analysis
"Many small business owners and executives consider themselves at worst victims, and at
best observers of what goes on in their industry. They sometimes fail to perceive that
understanding your industry directly impacts your ability to succeed. Understanding your
industry and anticipating its future trends and directions gives you the knowledge you need to
react and control your portion of that industry,"
Kenneth J. Cook wrote in his book The AMA Complete Guide to Strategic Planning for
Small Business. "However, your analysis of this is significant only in a relative sense. Since both
you and your competitors are in the same industry, the key is in finding the differing abilities
between you and the competition in dealing with the industry forces that impact you. If you can
identify abilities you have that are superior to competitors, you can use that ability to establish a
competitive advantage."
An industry analysis consists of three major elements: the underlying forces at work in
the industry; the overall attractiveness of the industry; and the critical factors that determine a
company's success within the industry.
One way in which to compare a particular business with the average of all participants in
the industry is through the use of ratio analysis and comparisons. Ratios are calculated by
dividing one measurable business factor by another, total sales divided by number of employees,
for example. Many of these ratios may be calculated for an entire industry with data available
from many reports and papers published by the U.S. Departments of Commerce and Labor.
5
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
By comparing a particular ratio for one company with that of the industry as a whole, a
business owner can learn much about where her business stands in comparison with the industry
average. For example, a small nursing home business can compare its "payroll per employee"
ratio with the average for all residential care operators in the U.S. in order to determine if it is
within a competitive range. If her business's "payroll per employee" figure is higher than the
industry average, she may wish to investigate further.
Checking the "employees per establishment" ratio would be a logical place to look next.
If this ratio is lower than the industry average it may justifying the higher per-employee payroll
figure. This sort of comparative analysis is one important way in which to assess how one's
business compares with all others involved in the same line of work. There are various sources
for the industry average ratios, among them is the industry analysis series published by Thomson
Gale as the USA series.
Another premier model for analyzing the structure of industries was developed by
Michael E. Porter in his classic 1980 book Competitive Strategy: Techniques for Analyzing
Industries and Competitors. Porter's model shows that rivalry among firms in industry depends
upon five forces: 1) the potential for new competitors to enter the market; 2) the bargaining
power of buyers; 3) the bargaining power of suppliers; 4) the availability of substitute goods; and
5) the competitors and nature of competition. These factors are outlined below.
INDUSTRY FORCES
The first step in performing an industry analysis is to assess the impact of Porter's five
forces. "The collective strength of these forces determines the ultimate profit potential in the
industry, where profit potential is measured in terms of long term return on invested capital,"
Porter stated. "The goal of competitive strategy for a business unit in an industry is to find a
position in the industry where the company can best defend itself against these competitive
forces or can influence them in its favor." Understanding the underlying forces determining the
structure of the industry can highlight the strengths and weaknesses of a small business, show
where strategic changes can make the greatest difference, and illuminate areas where industry
trends may turn into opportunities or threats.
6
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Ease of Entry
Ease of entry refers to how easy or difficult it is for a new firm to begin competing in the
industry. The ease of entry into an industry is important because it determines the likelihood that
a company will face new competitors. In industries that are easy to enter, sources of competitive
advantage tend to wane quickly. On the other hand, in industries that are difficult to enter,
sources of competitive advantage last longer, and firms also tend to benefit from having a
constant set of competitors.
The ease of entry into an industry depends upon two factors: the reaction of existing
competitors to new entrants; and the barriers to market entry that prevail in the industry. Existing
competitors are most likely to react strongly against new entrants when there is a history of such
behavior, when the competitors have invested substantial resources in the industry, and when the
industry is characterized by slow growth. Some of the major barriers to market entry include
economies of scale, high capital requirements, switching costs for the customer, limited access to
the channels of distribution, a high degree of product differentiation, and restrictive government
policies.
Power of Suppliers
Suppliers can gain bargaining power within an industry through a number of different
situations. For example, suppliers gain power when an industry relies on just a few suppliers,
when there are no substitutes available for the suppliers' product, when there are switching costs
associated with changing suppliers, when each purchaser accounts for just a small portion of the
suppliers' business, and when suppliers have the resources to move forward in the chain of
distribution and take on the role of their customers.
Supplier power can affect the relationship between a small business and its customers by
influencing the quality and price of the final product. "All of these factors combined will affect
your ability to compete," Cook noted. "They will impact your ability to use your supplier
relationship to establish competitive advantages with your customers."
7
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Power of Buyers
The reverse situation occurs when bargaining power rests in the hands of buyers.
Powerful buyers can exert pressure on small businesses by demanding lower prices, higher
quality, or additional services, or by playing competitors off one another. The power of buyers
tends to increase when single customers account for large volumes of the business's product,
when a substitutes are available for the product, when the costs associated with switching
suppliers are low, and when buyers possess the resources to move backward in the chain of
distribution.
Availability of Substitutes
"All firms in an industry are competing, in a broad sense, with industries producing
substitute products. Substitutes limit the potential returns of an industry by placing a ceiling on
the prices firms in the industry can profitably charge," Porter explained. Product substitution
occurs when a small business's customer comes to believe that a similar product can perform the
same function at a better price.
Substitution can be subtle—for example, insurance agents have gradually moved into the
investment field formerly controlled by financial planners—or sudden—for example, compact
disc technology has taken the place of vinyl record albums. The main defense available against
substitution is product differentiation. By forming a deep understanding of the customer, some
companies are able to create demand specifically for their products.
Competitors
"The battle you wage against competitors is one of the strongest industry forces with
which you contend," according to Cook. Competitive battles can take the form of price wars,
advertising campaigns, new product introductions, or expanded service offerings—all of which
can reduce the profitability of firms within an industry. The intensity of competition tends to
increase when an industry is characterized by a number of well-balanced competitors, a slow rate
of industry growth, high fixed costs, or a lack of differentiation between products.
8
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Success factors are those elements that determine whether a company succeeds or fails in
a given industry. They vary greatly by industry. Some examples of possible success factors
include quick response to market changes, a complete product line, fair prices, excellent product
quality or performance, knowledgeable sales support, a good record for deliveries, solid financial
standing, or a strong management team. "The reason for identifying success factors is that it will
help lead you to areas where you can establish competitive advantages," Cook noted. The first
step is to determine whether or not the company possesses each success factor identified. Then
the small business owner can decide whether the company can and should develop additional
success factors.
9
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
competition in an industry and their underlying causes have been diagnosed, the firm is in a
position to identify its strengths and weaknesses relative to the industry," Porter wrote.
"An effective competitive strategy takes offensive or defensive action in order to create
a defendable position against the five competitive forces." Some of the possible strategies
include positioning the firm to use its unique capabilities as defense, influencing the balance of
outside forces in the firm's favor, or anticipating shifts in the underlying industry factors and
adapting before competitors do in order to gain a competitive advantage.
10
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Chapter Two
RESEARCH DESIGN
LIC of India has been the first choice of insurance for any individual insurance customer.
However LIC is not only taken as an insurance product but also perceived as an investment tool.
The individual customers always faced the problem whether it is good to invest in the LIC or in
any other investment avenue. Hence to solve the problem a study on the industry and company
analysis of LIC is taken.
To study the growth profile of the company during the study period.
To study the financial position of the company and operation of Life Insurance
Corporation
11
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
SCOPE OF STUDY:
The study mainly attempts to analyze the company selected for the study. The financial
authorities can use this for evaluating their performance in future, which will help to analyze
financial statements and help to apply the resources of the company properly for the
development of the company and IT employees to bring overall growth. The present study
attempt to develop an analysis model for the company and the corresponding industry. There can
be forecasting to evaluate the overall performance of the LIC and the insurance industry in
future.
LIMITATION OF STUDY
1. The Secondary data like annual reports of LIC is collected from the company website,
hints the accuracy of the result of the study will depends upon the accuracy of data
provided by the company.
2. The study covers only the period of 5 years between 2013 to 2017
3. Various techniques, ratio statistical tools used in this study will have its own
limitation.
12
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
RESEARCH METHODOLGY
Secondary data
The secondary data is derived from the annual reports, Business line and finance
newspapers websites and the internal auditing books of Life Insurance Corporation
The study covers the time period of 5 years from the financial year 2012-13 and 2016-17.
To analyze and interpret the financial statements of the study unit the following tools are
used in the study.
1. Ratio Analysis.
The interpretations are also printed graphically using trend line graphs and sub-dividing
bar diagram.
13
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Chapter Three
INDUSTRY PROFILE
Introduction
The insurance industry of India consists of 57 insurance companies of which 24 are in life
insurance business and 33 are non-life insurers. Among the life insurers, Life Insurance
Corporation (LIC) is the sole public sector company. Apart from that, among the non-life
insurers there are six public sector insurers. In addition to these, there is sole national re-insurer,
namely, General Insurance Corporation of India (GIC Re). Other stakeholders in Indian
Insurance market include agents (individual and corporate), brokers, surveyors and third party
administrators servicing health insurance claims.
Out of 33 non-life insurance companies, five private sector insurers are registered to underwrite
policies exclusively in health, personal accident and travel insurance segments. They are Star
Health and Allied Insurance Company Ltd, Apollo Munich Health Insurance Company Ltd, Max
Bupa Health Insurance Company Ltd, Religare Health Insurance Company Ltd and Cigna TTK
Health Insurance Company Ltd. There are two more specialised insurers belonging to public
sector, namely, Export Credit Guarantee Corporation of India for Credit Insurance and
Agriculture Insurance Company Ltd for crop insurance.
Market Size
Government's policy of insuring the uninsured has gradually pushed insurance penetration in the
country and proliferation of insurance schemes are expected to catapult this key ratio beyond 4
per cent mark by the end of this year, reveals the ASSOCHAM latest paper.
The number of lives covered under Health Insurance policies during 2015-16 was 36 crore which
is approximately 30 per cent of India's total population. The number has seen an increase every
subsequent year as 28.80 crore people had the policy in the previous fiscal.
14
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Premium income of the life insurance segment had increased 14.04 per cent in FY17 to Rs 4.18
trillion (US$ 64.92 billion). In August 2017, the Life Insurance industry reported a 24 per cent
growth in overall annualised premium equivalent with the help of both private players and Life
Insurance Corporation.
Investments
The following are some of the major investments and developments in the Indian insurance
sector.
Pradhan Mantri Fasal Bima Yojana (PMFBY) covered 50.9 million farmers in India in
2016-17.
India's leading bourse Bombay Stock Exchange (BSE) will set up a joint venture with
Ebix Inc to build a robust insurance distribution network in the country through a new
distribution exchange platform.
Revenues of the healthcare sector are projected to grow by 15 per cent between FY18-20
on the back of rise in health insurance coverage through government-sponsored schemes.
Government Initiatives
The Government of India has taken a number of initiatives to boost the insurance industry. Some
of them are as follows:
Government of India launches Pradhan Mantri Vaya Vandana Yojana, a pension scheme
which will provide guaranteed 8 per cent annual return to all the senior citizen above 60
years of age for a policy tenure of 10 years.
The Union Cabinet has approved the public listing of five Government-owned general
insurance companies and reducing the Government’s stake to 75 per cent from 100 per
cent, which is expected to bring higher levels of transparency and accountability, and
enable the companies to raise resources from the capital market to meet their fund
requirements.
15
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
The Insurance Regulatory and Development Authority of India (IRDAI) plans to issue
redesigned initial public offering (IPO) guidelines for insurance companies in India,
which are to looking to divest equity through the IPO route.
IRDAI has allowed insurers to invest up to 10 per cent in additional tier 1 (AT1) bonds
that are issued by banks to augment their tier 1 capital, in order to expand the pool of
eligible investors for the banks.
Road Ahead
The future looks promising for the life insurance industry with several changes in regulatory
framework which will lead to further change in the way the industry conducts its business and
engages with its customers. India with 3.42 per cent penetration rate in the insurance sector
offers greater penetration potential when compared to global average of 6.2 per cent
The country’s insurance market is expected to quadruple in size over the next 10 years from its
current size of US$60 billion.
Demographic factors such as growing middle class, young insurable population and growing awareness
of the need for protection and retirement planning will support the growth of Indian life insurance.
16
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
COMPANY PROFILE
Every day we wake up to the fact that more than 250 million lives are part of our family
called LIC.
We are humbled by the magnitude of the responsibility we carry and realise the lives that
are associated with us are very valuable indeed.
Though this journey started over six decades ago, we are still conscious of the fact that,
while insurance may be a business for us, being part of millions of lives every day for the past 61
years has been a process called TRUST.
The story of insurance is probably as old as the story of mankind. The same instinct that
prompts modern businessmen today to secure themselves against loss and disaster existed in
primitive men also. They too sought to avert the evil consequences of fire and flood and loss of
life and were willing to make some sort of sacrifice in order to achieve security. Though the
concept of insurance is largely a development of the recent past, particularly after the industrial
era – past few centuries – yet its beginnings date back almost 6000 years.
Life Insurance in its modern form came to India from England in the year 1818. Oriental
Life Insurance Company started by Europeans in Calcutta was the first life insurance company
on Indian Soil. All the insurance companies established during that period were brought up with
the purpose of looking after the needs of European community and Indian natives were not being
insured by these companies.
17
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
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 heralded 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
through insurance to various sectors of society. Bharat Insurance Company (1896) was also one
of such companies inspired by nationalism. The Swadeshi movement of 1905-1907 gave rise to
more insurance companies. The United India in Madras, National Indian and National Insurance
in Calcutta and the Co-operative Assurance at Lahore were established in 1906. In 1907,
Hindustan Co-operative Insurance Company took its birth in one of the rooms of the Jorasanko,
house of the great poet Rabindranath Tagore, in Calcutta.
The Indian Mercantile, General Assurance and Swadeshi Life (later Bombay Life) were
some of the companies established during the same period. Prior to 1912 India had no legislation
to regulate insurance business. In the year 1912, the Life Insurance Companies Act, and the
Provident Fund Act were passed. The Life Insurance Companies Act, 1912 made it necessary
that the premium rate tables and periodical valuations of companies should be certified by an
actuary. But the Act discriminated between foreign and Indian companies on many accounts,
putting the Indian companies at a disadvantage.
The first two decades of the twentieth century saw lot of growth in insurance business.
From 44 companies with total business-in-force as Rs.22.44 crore, it rose to 176 companies with
total business-in-force as Rs.298 crore in 1938. During the mushrooming of insurance companies
many financially unsound concerns were also floated which failed miserably. The Insurance Act
1938 was the first legislation governing not only life insurance but also non-life insurance to
provide strict state control over insurance business.
The demand for nationalization of life insurance industry was made repeatedly in the past
but it gathered momentum in 1944 when a bill to amend the Life Insurance Act 1938 was
introduced in the Legislative Assembly. However, it was much later on the 19th of January,
18
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
1956, that life insurance in India was nationalized. About 154 Indian insurance companies, 16
non-Indian companies and 75 provident were operating in India at the time of nationalization.
LIC had 5 zonal offices, 33 divisional offices and 212 branch offices, apart from its
corporate office in the year 1956. Since life insurance contracts are long term contracts and
during the currency of the policy it requires a variety of services need was felt in the later years
to expand the operations and place a branch office at each district headquarter. Re-organization
of LIC took place and large numbers of new branch offices were opened. As a result of re-
organisation servicing functions were transferred to the branches, and branches were made
accounting units. It worked wonders with the performance of the corporation. It may be seen that
from about 200.00 crores of New Business in 1957 the corporation crossed 1000.00 crores only
in the year 1969-70, and it took another 10 years for LIC to cross 2000.00 crore mark of new
business. But with re-organisation happening in the early eighties, by 1985-86 LIC had already
crossed 7000.00 crore Sum Assured on new policies.
Today LIC functions with 2048 fully computerized branch offices, 113 divisional offices,
8 zonal offices, 1381 satallite offices and the Corporate office. LIC’s Wide Area Network covers
113divisional offices and connects all the branches through a Metro Area Network. LIC has tied
up with some Banks and Service providers to offer on-line premium collection facility in
selected cities. LIC’s ECS and ATM premium payment facility is an addition to customer
convenience. Apart from on-line Kiosks and IVRS, Info Centres have been commissioned at
Mumbai, Ahmedabad, Bangalore, Chennai, Hyderabad, Kolkata, New Delhi, Pune and many
other cities. With a vision of providing easy access to its policyholders, LIC has launched its
SATELLITE SAMPARK offices. The satellite offices are smaller, leaner and closer to the
19
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
customer. The digitalized records of the satellite offices will facilitate anywhere servicing and
many other conveniences in the future.
LIC continues to be the dominant life insurer even in the liberalized scenario of Indian
insurance and is moving fast on a new growth trajectory surpassing its own past records. LIC has
issued over one crore policies during the current year. It has crossed the milestone of issuing
1,01,32,955 new policies by 15th Oct, 2005, posting a healthy growth rate of 16.67% over the
corresponding period of the previous year.
From then to now, LIC has crossed many milestones and has set unprecedented
performance records in various aspects of life insurance business. The same motives which
inspired our forefathers to bring insurance into existence in this country inspire us at LIC to take
this message of protection to light the lamps of security in as many homes as possible and to help
the people in providing security to their families.
Some of the important milestones in the life insurance business in India are:
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.
20
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Some of the important milestones in the general insurance business in India are :
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.
Objectives Of LIC
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.
21
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
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.
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
Board Of Directors
22
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Operations
23
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
LIC has been one of the pioneering organizations in India who introduced the leverage of
Information Technology in servicing and in their business. Data pertaining to almost 10 crore
policies is being held on computers in LIC. We have gone in for relevant and appropriate
technology over the years.
1964 saw the introduction of computers in LIC. Unit Record Machines introduced in late
1950’s were phased out in 1980’s and replaced by Microprocessors based computers in Branch
and Divisional Offices for Back Office Computerization. Standardization of Hardware and
Software commenced in 1990’s. Standard Computer Packages were developed and implemented
for Ordinary and Salary Savings Scheme (SSS) Policies.
24
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
With a view to enhancing customer responsiveness and services , in July 1995, LIC
started a drive of On Line Service to Policyholders and Agents through Computer. This on line
service enabled policyholders to receive immediate policy status report , prompt acceptance of
their premium and get Revival Quotation, Loan Quotation on demand. Incorporating change of
address can be done on line. Quicker completion of proposals and dispatch of policy documents
have become a reality. All our 2048 branches across the country have been covered under front-
end operations. Thus all our 100 divisional offices have achieved the distinction of 100% branch
computerisation. New payment related Modules pertaining to both ordinary & SSS policies have
been added to the Front End Package catering to Loan, Claims and Development Officers’
Appraisal. All these modules help to reduce time-lag and ensure accuracy.
All 7 Zonal Offices and all the MAN centres are connected through a Wide Area
Network (WAN). This will enable a customer to view his policy data and pay premium from any
branch of any MAN city. As at November 2005, we have 91 centers in India with more than
2035 branches networked under WAN.
IVRS has already been made functional in 59 centers all over the country. This would
enable customers to ring up LIC and receive information (e.g. next premium due, Status, Loan
Amount, Maturity payment due, Accumulated Bonus etc.) about their policies on the telephone.
This information could also be faxed on demand to the customer.
25
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Our Internet site is an information bank. We have displayed information about LIC & its
offices .Efforts are on to upgrade our web site to make it dynamic and interactive.The
addresses/e-mail Ids of ur Zonal Offices, Zonal Training Centers, Management Development
Center, Overseas Branches, Divisional Offices and also all Branch Offices with a view to speed
up the communication process.
LIC has given its policyholders a unique facility to pay premiums through Internet
absolutely free and also view their policy details on Internet premium payments.There are 11
service providers with whom L I C has signed the agreement to provide this service.
INFORMATION KIOSKS
We have set up 150 Interactive Touch screen based Multimedia KIOSKS in prime
locations in metros and some major cities for dissemination information to general public on our
products and services. These KIOSKS are enable to provide policy details and accept premium
payments.
INFO CENTRES
We have also set up 8 call centres, manned by skilled employees to provide you with
information about our Products, Policy Services, Branch addresses and other organizational
information.
26
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Global Youth Marketing Award for Most preferred Life Insurance Company
27
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
OUTLOOK MONEY -- NDTV PROFIT AWARD 2009 in " BEST LIFE INSURER
CATEGORY "
CNBC AWAAZ CONSUMER AWARD 2009 for " Most preferred insurance company "
28
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
29
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
30
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Dainik Purvoday - North East Consumer Awards - Most Preferred Life Insurer
31
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
ET Best Brands
32
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Ashirwad Award
33
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
3-The-Indian-Insurance-Award-2015
4-The-Indian-Insurance-Award-2015
5-National-Award-for-Excellence-CSR-and-Sustainability
7-Mumbai-Hot-Brand-2015
8-5th-ACEF-AWARD
9-5TH-ACEF-AWARD
10-24TH-AASHIRWAD-RAJBHASHA-PURASKAR
11-Asian-Training-and-Development-Award
12-Golden-Peacock-Award-2015
13-India-s-Most-Trusted-Award-2015
14-World-s-Greatest-Brand
15-Readers-Digest-Award
16-Greentech-CSR-Award
17-ABP-BE_Award
18-Lokmat-Corporate-Excellence-Award
19-Lokmat-Corporate-Excellence-Award
34
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
20-FACE-India-Rashtra-Vibhushan-Award
21-ABCI-Award-2016
22-ABCI-Award-2016
23-ABCI-Award-2016
24-SUPERBRANDS-2015
25-Website-of-the-Year-2015
26-My-FM-Stars-of-Industry-Award
27-Brand-Icon-Award
28-ABP-News-BFSI-Award
29-Construction-Industry-Award-2015
30-Dainik-Bhaskar-India-Pride-Award
31-Money-Today-Financial-Award
32-Golden-Peacock-Award-National-Training-2016
5-Magzimise Awards
35
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
11-Superbrands 2016
14-Readers'Digest Awards2016
19-Brand Icon
36
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Chapter Four
Analysis:
From the above table we can see that gross premiums written in India in 2017 is 4219.8,
in 2016 it is 3547.7, in 2015 it is 4015.7, in 2014 it is 3380 and in 2013 it is 3380 billion
37
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
4.1 Graph showing the gross premiums written down for Life insurance
6000
5000 1287
903.5
4000 929.5
845 780
3000
0
2017 2016 2015 2014 2013
Interpretation:
The above graph shows that the gross premiums written down for Life insurance has
increased slightly for the current year when compared to the previous years. That is the same
case with the non-life insurance also.
38
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Analysis:
From the above table we can see that the growth in life insurance premium for 2017 is 1190.15
billion, in 2016 it was 975, in 2015 it was 975, in 2014 it was 845 and in 2013 it was 910.
39
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
4500
4000
3500
3000
3029.65
2500
2574 2554.5
2535 2470
2000
1500
1000
0
2017 2016 2015 2014 2013
Private Public
Interpretation:
The life insurance market grew from 682.5 billion in FY02 to 4219.8 billion in FY17.
During 2016-17, private sector life insurers recorded premium of Rs 1.18 trillion while LIC, the
only public sector life insurer recorded premium of Rs 3 trillion. Over FY02–17, life insurance
premiums expanded at a CAGR of 13.28 per cent. In August 2017, the Life Insurance industry
reported a 19 per cent growth in overall annualised premium equivalent with the help of both
private players and Life Insurance Corporation . The life insurance industry has the potential to
grow 2-2.5 times by 2020 in spite of multiple challenges supported by long-term trends and
fundamentals underlying household savings. Private life insurers in India posted 28 per cent
year-on-year increase in its annual premium equivalent (APE) for June 2017. Life insurance
industry in India is expected to grow at 15-18 per cent on APE basis in FY18.
40
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
2014 2.6 44
2013 3.1 41
Analysis :
From the above table we can see that the insurance penetration and density have shown
the figures of 2.72 and 46.5 in 2016, in year 2015 it was 2.72 and 43.2, in 2014 it was 2.6 and 44,
in 2013 it was 3.1 and 41 and in 2012 it was 3.17 and 42.7
41
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
60
50
40
30
46.5
43.2 44 41 42.7
20
10
Penetration Density
Interpretation:
Life insurance penetration reached 2.72 per cent in 2016. Life insurance density in India
increased from 2158 in 2006 to 3022.5 in 2016.
42
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
4.4 Table Showing Share of Public Sector and Private sector insurers for year 2005 and
2017
2005 98% 2%
Analysis:
From the above table we can see that the share of public and private sector insurers for
2005 was 98% and 2% and for the year 2017 it is 71.06% and 28.93%.
43
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
4.4 Graph showing Share of Public Sector and Private sector insurers for year 2005 and
2017
2005
2%
98%
Interpretation:
From the above graph we can see that the insurance from public sector insurers was 98%
and for the private sector insurance it was only 2% in the financial year of 2005.
44
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
4.5 Graph Showing the Share of Public Sector and Private sector insurers for year 2017
2017
Interpretation:
Over the years, share of private sector in life insurance segment has grown from around 2
per cent in FY03 to 29.6 per cent in FY16. The share of private life insurers is estimated at 28.93
per cent in FY17.
45
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
LIC 71.07%
ICICI 4.49%
HDFC 4.97%
Others 13.67%
Analysis:
From the above table we can see that the market share of LIC is 71.07%, ICICI is 4.49%,
HDFC is 4.97%, SBI Life is 5.80% and others is 13.67%
46
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Percentage Share
13.67%
5.80%
4.97%
4.49%
71.07%
Interpretation:
As of November 2017, life insurance sector had 23 private players in comparison to only
4 in FY02. With 71.07 per cent share market share in FY17, LIC continues to be the market
leader, followed by ICICI Prudential.
47
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Motor 39.40%
Health 24%
Fire 7.50%
Marine 2%
Others 27.1%
Analysis:
From the above table we can see that the Non – life insurance share of the market is
39.40% for Motor, 24% for Health, 7.50% for fire, 2% for marine and 27.1% for others.
48
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Percentage of Share
Interpretation:
Non-Life insurers include general insurers, standalone health insurers and specialized
insurers. Motor insurance accounted for 39.4 per cent of non-life insurance premiums earned in
India in FY18. With Gross Direct Premiums at Rs 26,058.99 crore (US$ 4.03 billion) in FY18,
the health segment has a 24 per cent share in gross direct premiums earned in the country.
Private players accounted for a share of around 48.01 per cent in the Gross Direct Premiums
generated in non-life insurance sector while public sector companies and specialised garnering
around 52 per cent share in October 2017
49
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
4.7 Table Showing Share of Private and Public Sector in the year 2005 and 2017
Analysis:
From the above table we can see that the share of private and public are 75% and 51.99%
in 2005 and 15% and 48.01% in 2017
50
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
4.8 Graph Showing Share of Private and Public Sector in the year 2005
2005
15%
75%
Interpretation:
From the above graph we can see that the share of private sector is 15% which is a less a mount.
The share of public sector is more than private sector which 75 %.
51
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
4.9 Graph Showing Share of Private and Public Sector in the year 2017
2017
48.01%
51.99%
Interpretation:
The market share of private sector companies in non-life insurance segment rose from 15
per cent in FY04 to 48.01 per cent in FY18. The Gross Direct Premium of private companies
increased from US$ 0.8 billion in FY05 to Rs 59,601.56 crore (US$ 9.25 billion) in FY17,
witnessing growth at a CAGR of 22.6 per cent.
52
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
National 11.03%
Oriental 7.72%
Others 35.35%
Analysis:
From the above table we can see that the percentage share of New India is 15.05%,
United India is 10.65%, National is 11.03%, Oriental is 7.72%, ICICI Lombard is 8.81%, Bajaj
Allianz is 6.32%, HDFC Ergo is 5.07% and others is 35.35%
53
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
4.10 Graph showing market share of major companies in terms of premium collected
Percentage of Share
15.05%
35.35%
10.65%
11.03%
New India United India National Oriental ICICI Lombard Bajaj Allianz HDFC Ergo Others
Interpretation:
54
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Analysis:
From the above table we can see that the policy payments of LIC for 2017 is102065 for
Maturity, 13439 for Death, 6883 for Annuities and 45237 for surrender.
55
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
160000
45237
140000
59652
37326 46564
120000 6883
13439 56033
100000 5570
12159 5060 4417
11030 10289
80000 9308
9414
60000
102065
88390 83372 85162
40000
64534
20000
0
2017 2016 2015 2014 2013
Interpretation:
From the above graph we can see that the policy payments for all the four sectors of
policies like Maturity, death, annuities and surrender have increased for the LIC which had
decreased slightly in the year of 2016 from its previous financial year of 2015,.
56
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Year Policies
2017 2.01
2016 2.05
2015 2.01
2014 3.45
2013 3.68
Analysis:
From the above table we can see that the policies in 2017 is 2.01 crores, in 2016 it was
2.05, in 2015 it was 2.01, in 2014 it was 3.45 and in 2013 it was 3.68
57
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Policies
4
3.68
3.45
3.5
2.5
2.01 2.05 2.01
2
1.5
0.5
0
2017 2016 2015 2014 2013
Policies
Interpretation:
From the above graph we can see that the policies given out from LIC for the current
financial year has decreased from its previous financial year a little.
58
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Analysis:
From the above table we can see that the total investments in India is 2469125.16 in 2017
and out of India 3263.66 and in the previous financial year it was 2107995.77 in India and
1257.57 out of India.
59
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
2500000 3263.66
1257.57
2000000 3042.14
2912.67
1500000 2408.61
2469125.16
1000000 2107995.77
1943207.18
1581777.81 1484047.92
500000
0
2017 2016 2015 2014 2013
Interpretation:
From the above graph we can see that the investments of LIC in India have been seeing a
good increasing note over the past financial years as did the investments out of India also. This
shows a better awareness of insurance among people.
60
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Balance Sheet
SOURCES OF
FUNDS
SHAREHOLDERS
’ FUNDS:
Analysis:
61
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
From the above table we can see that total shareholders fund was 60645.28 in 2017, it
was 58294.29 in 2016, it was 56254.42 in 2015, it was 53859.53 in 2014 and in 2013 it was
51547.06
52000 51547.06
50000
48000
46000
2017 2016 2015 2014 2013
Interpretation:
From the above graph we can see that the total shareholders’ funds have been seeing a
increasing note over the past five financial years and it stood highest in the current financial year
of 2017.
62
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
POLICYHOLDER
S’ FUNDS:
FUNDS FOR
DISCONTINUED
POLICIES
63
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Analysis:
From the above table we can see that the total policy holders funds for 2017 is
252854018.35, for 2016 it was 217022485.76, for 2015 it was 199151596.87, for 2014 it was
172391765.13 and for 2013 it was 152254464.64
64
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
252854018.35
250000000
217022485.76
199151596.87
200000000
172391765.13
152254464.64
150000000
100000000
50000000
0
2017 2016 2015 2014 2013
Interpretation:
From the above graph we can see that the total policy holders funds for the LIC has been
increasing over the financial years and stood highest for the current financial year.
65
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Analysis:
From the above table we can see that the investments for shareholders funds was
57397.52 in 2017, it was 51308.57, in 2015 it was 50620.49, in 2014 it was 50808.12 and in
2013 it was 45659.33
66
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
223887271.75
200000000
187224261.18
167774145.39
150000000
138987238.72
118777523.9
100000000
50000000
Shareholders’ Policyholders’
Interpretation:
From the above graph we can see that the policyholder’s policy investments have been
continuously showing an increasing trend over the past five financial years whereas the
shareholders’ investment has shown almost inactivity during the years of study.
67
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Analysis:
From the above table we can see that the cash and bank balances for the LIC for 2017 is
3272887.32, for 2016 it was 4291069.48 for 2015 it was 6437549.09, for 2014 it was
8100300.40 and for 2013 it was 8639074.63
68
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
14000000
6000000
Interpretation:
From the above graph we can see that the cash and bank balances for the LIC has been
showing a decreasing note over the five financial years under study so did the advances and the
others assets of the company.
69
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
4.16 Table showing the current liabilities for the years of 2013, 2014, 2015,
2016 and 2017.
Analysis:
From the above table we can see that the current liabilities for 2017 is 1214171.56, in the
year 2016 it was 582407.72, in 2015 it was 565860.01, in 2014 it was (147133.42) and in 2013
it was 813557.43
70
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
0
2017 2016 2015 2014 2013
-147133.42
-500000
Interpretation:
From the above graph we can see that the current liabilities have been showing an
increasing trend over years along with the provision.
71
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Analysis:
From the above table we can see that the total premiums earned for 2017 is 20011371.52
in the year 2016 it was 19095950.75, in 2015 it was 18638114.9, in 2014 it was 17939032.14
and in 2013 it 16223197.69
72
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
10000000
5000000
0
2017 2016 2015 2014 2013
Interpretation:
From the above graph we can see that the premiums earned have been increasing over the past
financial years from 2013 to the current financial year of 2017.
73
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Chapter Five
FINDING
74
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
6. The Indian insurance industry had a CAGR of 10.49% over the past 11 years.2 Despite
the global economic slowdown of 2010–13, there was a remarkable recovery in premium
growth in India.
7. The life insurance market grew from 10.5 billion USD in FY02 to 54.58 billion USD in
FY16. From FY02–16, life insurance premiums expanded at a CAGR of 12.49% .
Despite multiple challenges, the life insurance industry has the potential to grow by 2–2.5
times by 2020, supported by long-term trends and fundamentals underlying household
savings.
8. The life insurance premium market expanded at a CAGR of 11.93% from 14.5 billion
USD in FY04 to 56.05 billion USD in FY16. During the first half of FY 2016–17, the life
insurance industry reported a 20% growth in overall APE.
75
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
SUGGESTIONS
1. The insurance product advertising should emphasize the need for security.
2. Insurance should be popularized as a means of saving for the future security of the tax.
6. Creating a positive image of private companies, such as in the minds of their target
consumers in mind, people should try their level best to create a positive and favorable
image.
7. Training and development agents, so that they can effectively serve the customer and the
doubts and the company must provide training to their agents.
9. With the help of agents and branch managers, branch managers and agents have the full
cooperation of the company.
10. To increase the level of insurance penetration LIC may focus on bringing products that
suit to the rural customers.
11. The company if possible should invest in advertising, conduct road shows, and spend
money on hoardings, so that it can better propagate awareness about its various lesser
known products.
12. LIC should also tie up with several other banks apart from the existing ones to sell its
products i.e. through banc assurance
76
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
13. All the hidden charges should clearly be stated in the form and explained by the agent.
CONCLUSION
Insurance is a tool by which fatalities of a small number are compensated out of funds
collected from plenteous. Insurance is a safeguard against uncertain events that may occur in the
future. Company image is the highly important criteria that consumers consider before taking up
a life insurance. This is mainly because people expect safety and secure for their money which
they invest, followed by the factor Premium which we pay to the insurer and then Bonus and
Interest paid by the company, services etc
LIC dominates the Indian insurance industry. In today’s competitive world, customer
satisfaction has become an important aspect to retain the customers, not only to grow but also to
serve. Increased competition, wide range of product offerings and multiple distribution channels
cause companies to value satisfied and highly profitable customers. Customer service is the
critical success factor in a company and providing top notch customer service differentiates great
customer service from indifferent customer service.
The entry of private sector insurance companies into the Indian insurance sector triggered
off a series of changes in the industry. Even with the stiff competition in the market place, it is
evident from the study that products offered by the LIC are creative, innovative and of the liking
of the customers, moreover they are satisfied by the true knowledge provided by the company or
agents and they are easily accessible, Flexible payment schemes with no hidden cost, there is no
undue delay in claims settlement, customers are highly satisfied by the grievance redressal
mechanism, and in the near future if they will go for the policy they will stuck to LIC of India,
which shows the great faith and positive perception of the customers towards LIC of India.
77
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
BIBLIOGRAPHY
1. Alok Mittal and Akash Kumar (2006), "An Exploratory Study of factors affecting the
choice of life insurance products," Nalini Prava Tripathy and Prabir Paul (ed.), Insurance:
Theory and Practice, New Delhi, Prentice Hall of India Private Limited.
2. Malhotra, R.N. (2005), Verma S B in the "Indian Insurance Industry Liberalising", (ed.),
Risk Management, New Delhi, Deep and Deep Publications Pvt. Ltd.
3. S.B and C Nageswara Rao, Madhavi (2006), "An Overview of Private Insurance
Companies", Nalini Prava Tripathy and Prabir Paul (ed.), Insurance: Theory and Practice,
New Delhi, Prentice Hall of India Private Limited.
4. Nalini Prava Tripathy (2006), "A Study of private players in the insurance brand
positioning Industries", Nalini Prava Tripathy and Prabir Paul (ed.), Insurance: Theory
and Practice, New Delhi, Prentice Hall of India Private Limited.
5. Dos steward of the Cauvery V.S. (2000), Insurance, Total Quality Assessment in New
Delhi, Akansha Publishing House.
6. Yada Anshuja and Babita Tiwari (2012), "Analytical study of the liberalization of the
Indian Life Insurance Industry in the Post", International Journal of Social Science
Saturday, .1 (2), pp.1-10.
7. Girish Kumar, GS. And KV Eldhose (2008), "Life insurance services, consumer
perceptions - A Comparative Study on the public and private sectors", Insurance
Chronicle, Vol. VIII (8), pp. 65-74.
9. Imtiaz H Dhalait (2007), Insurance Times, pp.20-25 "Customer service is the essence of
the insurance business."
78
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
10. Joy Chakraborthy (2007), "the private life insurance companies in India: Growing
Prospects and Challenges", insurance Chronicle, Vol.III (8), pp.29-39.
79
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
ANNEXURE
Table (5-1) Balance Sheet for the years of 2013, 2014, 2015, 2016 and 2017
SOURCES OF
FUNDS
SHAREHOLDER
S’ FUNDS:
80
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
POLICYHOLDER
S’ FUNDS:
FUNDS FOR
DISCONTINUED
POLICIES
81
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
APPLICATION
OF FUNDS
INVESTMENTS
82
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
CURRENT
ASSETS
83
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
84
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Income from
Investments
Other Income
85
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
86
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT
A STUDY ON COMPANY AND INDUSTRY ANALYSIS AT LIC
Change in valuation
of liability in respect
of life policies
87
GANGA INSTITUTE OF TCHNOLOGY AND MANAGEMENT