Submitted in partial fulfillment of the requirement of. Bachelor Of Business Administration (BBA) Guru Gobind Singh Indraprastha University Delhi
Submitted to : Dr Hakimuddin khan by; Aman Sharma Enrollm ent No.; 16421401710 BBAIII – B (EVE) Submitted


This is to certify that Aman Sharma is a bonafide student of this institute pursuing BBA full time programme of three years duration which is in affiliation with Guru Gobind Singh Indraprastha University. And has undertaken a minor project report on “MARKETING OF LIC INSURANCE” in partial fulfillment of BBA degree as required under the rules of the university. The work done by him is original and have not been submitted(in full or part) for any degree or diploma any where

Signature of Guide Date :

The present work is an effort to throw some light on “MARKETING OF LIC INSURANCE”. The work would not have been possible to come to the present shape without the able guidance, supervision and help to me by number of people. With deep sense of gratitude I acknowledge the encouragement and guidance received by our faculty guide, Dr Hakimuddin Khan. I convey my heartfelt affection to all those people who helped and supported me during the course of completion of my Project Report.


i) ii) iii) Introduction Objectives of the study Purpose of the study

Company’s Profile

Research methodology

Data analysis and interpretations

Findings Recommendations Conclusion Limitations of the study

32 5. Fig 4. Fig 2.1-graph showing the LIC housing finance………………….pie chart showing market position of LIC……………….30 4.20 3. Fig 2.34 6..3-pie chart showing the Achievements of LIC……………. Fig 4.Bibliography LIST OF GRAPHS & CHARTS 1.3-graph showing the revenues of LIC………………………37 .2.2-organizational structure of LIC Company………………. Fig 4.1-map showing areas of Operations of LIC insurance company………16 2. Fig 4.


health and homeowners into commodities. In fact. The market for insurance has peaked and is starting to contract in all segments as a looming recession forces policy holders to trim their budgets. the price competition between the major insurers has reduced the level of profitability at a time of slowing revenue growth. There are two reasons for this. the four leading insurers – Allstate. Progressive and State Farm – have maintained brand awareness and their marketing activities pressure their smaller rivals to maintain their marketing momentum to avoid losing market share. the level of spending cannot be maintained. it has slowed quite significantly over the last eighteen months. The Insurance Marketing focuses on the formulation of an ideal mix for Insurance business so that the Insurance organization survives and thrives in the right perspectives. It has become easy for policy holders to obtain comparative quotes through sites like this. accident. Secondly. retirement or theft. GEICO. Despite this. Policies can be written over the internet without the parties ever having to meet (whether directly or through an agent). more money could be diverted to the marketing budget. which results in financial losses. fire. to niche marketing and the internet. The growth of the internet has turned the standard policies of auto. The term Insurance Marketing refers to the marketing of Insurance services with the aim to create customer and generate profit through customer satisfaction. It eliminates worries and miseries of losses by destruction of property and death. there is a potential problem. The main function of Insurance is to provide protection against the possible chances of generating losses.Marketing in Insurance Insurance a financial service for collecting the savings of the public and providing them with risk coverage caused due to uncertain events like death. So the advertising has to shift to differentiate the insurers and their . Marketing in the Insurance Industry Over the last ten years. because the insurance industry was highly profitable. This general growth was fueled by competition for market share and. pension. advertizing spending rose significantly but the spend slowly shifted from the traditional print and broadcast media. Today. etc. However.

The new campaigns focus on market segments where growth is predicted. Implementation ~ 6. The insurance industry therefore has to spend less on marketing and more on actually delivering better service. marketing mix is the blend of all the marketing efforts around the 4 ingredients: product. Marketing is a managerial process by which individuals and groups obtain what it needs. cost and satisfaction. place. price. 5. In other words. This has serious implications for media that have traditionally relied on advertising revenue from the advertising industry. That means a focus on other elements such as claims handling and customer service.policies. Marketing process: 1. Strategies 4. Newspapers in particular have seen a dramatic drop in their insurance ad revenue. Objectives 3. Tactics ~ ~ ~ ~ ~ where we are where we want to see us after some time how to achieve techniques application how to apply control our market. promotion. Marketing relies on needs and wants. We can therefore expect to see a further reduction in marketing spend as the reality of a recession bites into consumer confidence. demand. Marketing is a social and a managerial process offering and exchanging products of value with others. More specialty products are being offered and Spanish language advertising to the Latino market has been growing. and these variables are inter-related and all revolve around potential customer’s satisfaction as a focal point. There are now customer sites which carry stories of poor service. Marketing mix is composed of large battery of devices which might be employed to induce customers to buy a particular product. . value. Price on its own is not a key feature given the ease with which prices can be compared. The internet is not passive. Controls What is marketing mix? What are the elements of marketing mix? The marketing mix is the combination of marketing activities that an organization engages in so as to best meet the needs of its targeted market. Analysis 2. products.

A product is both what a seller has to sell and a buyer has to buy. it means tangible product and when we produce or generate services. If we produce goods. its price. a fabricated conveyance powered by gasoline engine which carries people from one place to another. an Insurance company sells services and therefore services are their product. Price is a powerful instrument in which both buyers and sellers are keenly interested. process & physical attraction. PRICE Price is a major marketing tool and helps in directing the product to a specific consumer segment. promotion. the product.e. The product is the focus of making and marketing efforts. Price is the value of a product expressed in terms of money. Thus.The marketing mix includes sub-mixes of the 7 P's of marketing i. people. PRODUCT A product means what we produce. a car in a physical sense. it means intangible service product. Product is the sum total of physical and psychological satisfaction it provides to the buyer. The product mix has the following important variables: {a} product line and product range {b} product design {c} product package {d} product quality {e} product labeling {f} product branding {g} after sales services and guarantees 2. The price has the important following variables: {a} pricing policies and strategies {b} terms of credit {c} terms of delivery {d} margin . place. For instance. 1.

PLACE Place or distribution mix stands for the marketing arrangement for the smooth flow of the goods and services from the producers to consumers. it is concerned with the place. The place mix has the following important variablesa} Transportation b} warehousing c} inventory levels d} the channels of distribution Another important dimension to the Place Mix is related to the location of the insurance branches. time and possession utilities. and iii) Commission charged for underwriting and consultancy activities. availability of infrastructural facilities and the management of branch offices and premises. 3. The promotion mix has the following important variables. 4. physical distribution and channels of distribution. While locating branches. ii) Interest charged for defaulting the payment of premium and credit facility. the branch manager needs to consider a number of factors. PROMOTION Promotion mix is the communication mix which deals with the personal and impersonal persuasive communication about the products or service of the manufacturer.{e} resale price maintenance In the insurance business the pricing decisions are concerned with: i) The premium charged against the policies. such as smooth accessibility. In other words. a) Personal selling . it signifies two things namely.

b) Advertising c) Sales promotion d) Trade fairs and exhibition e) Public relations The insurance services depend on effective promotional measures. it is very important to use this resource efficiently in order to satisfy customers. Technology (IT and Data houses) can either complement or supplement the channels of distribution cost effectively. It is essential to have both personal and impersonal promotion strategies. Installment schemes should be streamlined to cater to the ever growing demands of the customers. Being a service industry which involves a high level of people interaction. In promoting insurance business. 6. Training the employees. . both at the staff and agent level. The use of data warehousing management and mining will help to find out the profitability and potential of various customers product segments. The processing method should be easy and convenient to the customers. use of IT for efficiency. development and strong relationships with intermediaries are the key areas to be kept under consideration. The speed and accuracy of payment is of great importance. Training. It can also help to improve customer service levels. Due attention should be given in selecting the promotional tools for agents and rural career agents and even for the branch managers and front line staff. 5. PROCESS The process should be customer friendly in insurance industry. the agents and the rural career agents play an important role. PEOPLE Understanding the customer better allows designing appropriate products. is one of the important areas to look into.

4.7. PHYSICAL DISTRIBUTION: Distribution is a key determinant of success for all insurance companies. To understand the relationship between customers (who demand the product) and the suppliers or manufacturers (who produce the product). accounts. promoting. etc better. 5. . Objective of study 1. Buyers prefer a faceto-face interaction and they place a high premium on brand names and reliability. Finance companies and banks can emerge as an attractive distribution channel for insurance in India. 3. sales and so on. For studying the various marketing strategies for different fields like advertising. Banks hope to maximize expensive existing networks by selling a range of products. To study the marketing competition. 2. channels of distribution and various strategies opted by the marketing companies regarding products and prices. For understanding the company’s structure and functioning among various departments like finance. To study needs wants and expectorations of both customers as well as the sellers. HR.

viz. .PURPOSE OF THE STUDY The title of my Project is “MARKETING OF LIC INSURANCE”. The purpose of the study which I have done is to carry out an in-depth analysis of the MARKETING which is being practiced in most of the corporate. LIC. The basic purpose is carried on with an intention to reduce the study in the form of a report which is submitted in the partial fulfillment for the Award of Degree of BBA (Banking & Insurance).


Mumbai-400058 ADDRESS OF REGISTERED OFFICE. Jeevan Bima Marg. India. Mayfair Meridian. 022-26766221 Email ID . 9. P B no. Near St. 19053.1rst floor Yogakeshema Centre Office.Ltd.com .MINOR PROJECT REPORT ON LIC NAME .LIC (Life Insurance Corporation of India) ADDRESS -LIC Customer Zone Mumbai M/s Mayfair Housing Pvt. PHONE NO. Andheri (W). Mumbai-400021. Nariman Point. Maharashtra.Blaise Church.customerzone_mumbai@licindia. Caesar Road.

1-map showing areas of Operations of LIC insurance company. .GEOGRAPHICAL areas of Operations: Fig 2.

2003 – LIC China’s team exceeded 140 people in its four offices in Beijing. 1997 – First daily timeslot for broadcasting all over China is produced. . Such organizations as CCTV. A contract was signed with the Chinese Television Artists' Association. The Shanghai office was established. SBS and other media companies in China. advertisement and print media was initiated. 2000 – A new daily timeslot The World Odysseys was created. In this year LIC presented nearly 22000 hours of programs sourced from 14 different countries around the world. The development of radio. 2001 – A syndicated daily timeslot SAGA started. LIC’s Publishing Department starts growing. LIC Advertising wing showed extensive growth. 1999 – LIC became the production partner of the Discovery Channel. 1998 – Daily timeslot The Tales of Fabulous Nature began broadcasting on 121 TV stations around China. The Hong Kong office was established.HISTORY OF LIC • • 1993 – LIC was established. Hong Kong and Sydney. 1994 – The company started selling Australian productions to Chinese boasters and found a number of agents in China. and Jenny Cornish Media became partners of LIC. • 1995 – LIC becomes the exclusive representative of the Australian Broadcasting Corporation in China and starts to establish its local network. • • • • • • • • 2002 – Commercial success of SAGA. LIC Production wing grew significantly. Shanghai. 1996 – LIC becomes the exclusive representative of Film Australia. covering more than 90% of China’s population.

LIC opened its Travel Department.• 2004 – Company’s first production. The International Education company is established within LIC. Opening of Shenzhen office marked further expansion of company’s business. • 2009 – A co-operation was established with RAI TV (Italy) and became its agent in China. 2005 – LIC started investing the revenues from distribution of foreign documentaries in to producing Chinese documentaries. 2006 – SAGA becomes a country-wide recognized brand. and by rendering resources for economic development. LIC International Business Center was created. a six part series titled “China From Within” launched on the international market. In the course of the last 5 years LIC China C grew quickly and produced 5 high quality documentary films following its first production in 2004. Two new LIC’s timeslots appeared on Chinese TV – Enjoyable Creation and Chinese Legend. ." Ambition To be on the top 3 private life insurers in gross profit premium. distribution and advertising. The Vanguard timeslot broadcasts started. To be 1 of the top two companies in terms of profitability. • • • 2007 –LIC became the official agent of Animal Planet Channel responsible for every aspect of the channel’s broadcast in China. including program scheduling. • 2008 – SAGA of World Magazine began its commercial distribution. An award winning documentary PUYI – the Last Emperor of China was produced in cooperation with Liaoning TV." Vision "A trans-nationally competitive financial conglomerate of significance to societies and Pride of India. Mission "Explore and enhance the quality of life of people through financial security by providing products and services of aspired attributes with competitive returns. LIC’s Cultural wing gets rapid development.

in terms of number of new policies.6 crore while nearly a dozen private insurers accounted for the rest 25.83 per cent with 3. The popular unit-linked insurance plans (ULIP) contributed 80 per cent in LIC's new business premium of Rs 39.643 crore and it intended to invest between Rs 10.000 to 12. "In total LIC planned to invest around Rs 117 lakh crore this financial year of which Rs 52.541 crore as compared to the traditional business products." he said.58 crore of which 2.497.266.934.746 crore in infrastructure and social investments and Rs 44. However.82 per cent..000 crore had been already invested. LIC's investment in the capital market as on March 31.18 per cent in the last financial year with a premium collection of Rs 55.To be more customer focused and reduce complexity Market Share Insurance giant LIC had a healthy market share of 74.24.284. 2007 LIC's total investment was of Rs 6. 2007 stood at Rs 1. Rs 73.217 crore in bond and debentures.80 crore in State Government and other approved securities. LIC Chairman T S Vijayan said in his presentation of the financial performance in 2006-07. Till March 31.82 crore was invested in Central Government securities.000 crore in equities and preference shares in the current fiscal.72. Rs 64.. the state.82 crore new policies.owned company enjoyed a much better market share of 82.13.. .

Acting LIC chairman A Ramamurthy said the institution wants to sell around 2. 87.2-organizational structure of LIC Company COMPANY’S TURNOVER In a bid to maintain its high growth momentum.000 crore.65 crore policies this financial year. The target for its sum assured is pegged 25 per cent higher than the last fiscal’s mobilization of Rs 1. The institution has ended the last fiscal with a total first premium income of over Rs 15.000 crore.Fig 2. . the state-owned Life Insurance Corporation (LIC) has set a target of mobilizing over Rs 20.000 crore of new premiums in 2002-03.

Central Bank. Delhi. LIC has recently opened its first call centre in Mumbai. some three crore out of the LIC’s existing 13 crore policyholders can make enquiries through the call centre. . Initially. Hyderabad. In the next few days. LIC also plans to open a research cell to undertake comparative studies of its products and the private sector ones. Pune and Chennai. it also plans to open seven more in major cities like Ahmadabad.The institution is also planning to launch some ban assurance products after regulations on allowing banks to sell insurance products are announced. Nedungadi Bank and Bank of Punjab. LIC has already tied up with Oriental Bank of Commerce. Bangalore. It is also setting up videoconferencing facilities at its zonal offices.


quantitative and qualitative. experimental. There are various research designs like descriptive. The method you choose will affect results and findings and can help in understanding a phenomenon. it constitutes the blueprint for the collection. Which method to choose? What design you choose depends upon the different factors: (a) What information you want? The aims of the study.RESEARCH DESIGN A research design is a structure of any scientific work. and so on.” In fact. measurement and analysis of data. It gives direction and systematizes the research. the research design is the conceptual structure within which research is conducted. . There are basically 2 approaches. A research design is the arrangement of conditions for collection and analysis of Data in a manner that aims to combine relevance to the research purpose with economy in procedure. observational.

In a descriptive/diagnostic study the first step is to specify the objectives with sufficient precision to ensure that the data collected are relevant. 4. 2. with their merits and limitations.. Selected the sample. The data collected must be processed and analyzed. In other words. techniques for collecting the information must be devised. questionnaires. Then comes the question of selecting the methods by which the data are to be obtained. Designed the methods of data collection. The research design has focused attention on the following: 1. the researcher must be able to define clearly. either internal or external 4. formulated the objective of the study. If this is not done carefully. Choosing the approach. would it be.is it feasible to collect the data and if so. 3. the study may not provide the desired information. Several methods (viz. .(b) The nature of the phenomenon. 3.). observation. Most of the social research comes under this category. A descriptive methodology of research design involves the following suggested steps: 1. examination of records. 2. Descriptive research studies are those studies which are concerned with describing the characteristics of a particular individual. Firstly. Choosing a method of collecting data. the procedure to be used must be carefully planned. interviewing. In descriptive studies. Collection of the data. Since the aim is to obtain complete and accurate information in the said studies. (c) How reliable should the information be? The research design is comprised of the descriptive research studies. Locating the source of data. what he wants to measure and must find adequate methods for measuring it along with a clear cut definition of ‘the related topic. are available for the purpose and the researcher may user one or more of these methods. or of a group. either primary or secondary data. DE terminating the types of data needed. etc.

The second stage of data collection of the project reports is based on the secondary data. Researcher must be very careful in using secondary data. Records and publications of various associations connected with the business and industry. Detailed study is made in insurance sector on the basis of the data available in: Company records and statistics. The data collection process can be relatively simple depending on the type of data collection tools required and used during the research.. Methods used are questionnaires. for his own study. scope and object of enquiry. keeping in view the following factors: Nature.e. In this case he is certainly not confronted with the problems that are usually associated with the collection of original data. Books. Secondary data are data collected for some purpose rather than the problem at hand. They data used in this project report study is the published data. Primary data is that data that is not already available. and other sores of published information. they refer to the data which have already been collected and analyzed by someone else. As such the researcher must judiciously select the method/methods either primary or the secondary data collection. Reports prepared by research scholars. Technical and trade journals. When the researcher utilizes secondary data. focus groups.DATA COLLECTION Data collection is an important aspect of any type of research study. Time factor. He must make a minute scrutiny because it is just possible that the secondary data may be unsuitable or may be inadequate in the . Secondary Data may either be published data or unpublished data. There are various methods of data collection. then he has to look into various sources from where he can obtain them. Data collection is the key activity in the implementation of a marketing strategy and it must be carefully planned to provide information. magazines and newspapers. Secondary data means data that are already available i. The researcher collects it first-hand. Precision required. Inaccurate data collection can impact the results of the research study. interviews. observation and others.

There are also online databases of secondary dat. It saves time and efforts. evaluate the data: Evaluating data is similar to doing a criterion of a published research report. It can allow for larger scale studies on a small budget. 3. locating the data: Secondary data can be located by using printed indices. 3. The suitability of their application to the given problem. PRECAUTIONS IN USING SECONDARY DATA 1. The scope and object of the enquiry conducted by the original person/ research organization. For example: U. It is easily accessible. It is already available. It avoids data collection problems and provides a basis of comparison. such as American statistics index or the statistical reference index available at most libraries. It is cheap and inexpensive. 8. 4. sampling design and the data collection strategy and response rate obtained quality control measures which affect the study. USES OF SECONDARY DATA 1. It may allow the researcher to cover a wider geographical or temporal range. The method of collection adopted. The sources from which the information was obtained. 6. 4. 7. 2. verify the data: . 5. 5.context of the problem which the researcher wants to study. 2. The degree of accuracy desired. 2. It is unobtrusive. 3. METHODS OF SECONDARY DATA COLLECTION 1.S census. Everything about the original project that produced the data should be scrutinized to ensure that the project had high validity and reliability such as: theoretical and conceptual model used variables and hypothesis posited operational definitions of variables and measures employed sample frame.

journals and other similar periodicals. 4. have correct coding scheme. 2. have correct number of variables. have correct number of observations of cases. Data collecting organizations. 3.If the data seem valid and reliable. Newspapers and magazines. Library search and indexing. 4. this technique requires to go through written texts that have already done similar work and utilizing their researches for our own dissertations. 3. The data which is collected is not reliable all the times. 5. you need to make sure that we have accurate copy of the data. Internet search. These problems are as follows:1. especially if obtained if obtained through an electronic medium. Limitations in use of secondary data In collection of secondary data there are a lot of problem which are related to assembling of the data for the users. Low/less accuracy in which is collected. The data is sometimes not relevant. 2. Less Sufficiency in the data. . This method is not usually very reliable and requires appropriate citation and critical analysis for findings. It includes verifying that the collected data have proper documentation. If it is not available then we have to go for the primary data. using online resources to gather data for research purposes. INSTRUMENTS OF DATA COLLECTION 1. for example Gallup and AC nelson conduct researches on a recurrent basis ranging in a wide array of topics. Availability: it has to be seen that the kind of data you want is available or not.


86 percent in 2009-10.02 percent in the previous year.LIC market shares in 2010-2011 The market share of the government-run Life Insurance Corporation of India (LIC). in terms of number of policies in the country.70 percent in 2010-11 from 64. has registered growth in its market share for the second consecutive year despite increasing number of private players entering into the business. rose to 76. which has government backing for all its policies. Minister of State for Finance Namo Narran Meena said Friday.92 percent in 2010-11 from 73. The public sector behemoth. . When taking into consideration just the first year premium. LIC's market share rose to 68.

Fig 4.1-graph showing the LIC housing finance .

SHARE PRICES OF LIC BSE -14.00 150.21)% 229.32 52 Week Low 150.00 Low 215.40 (6.37)% 217.55 October 20th.10 232.35 285.40 151459 0 217.85 215.80 (6.10 Previous Close 231.95 52 Week High 285. 2011 15:59 CODE 500253 High Low Previous Close 52 Week High 52 Week Low Traded Volume NSE -14.55 October 20th.60 Traded Volume 7038660 FINANCIAL POSITION OF LIC . 2011 15:50 CODE LICHSGFIN High 229.

cr) 256.50 1018.cr) 1362.18 per cent in the last financial year with a premium collection of Rs 55. Trailing Yr.50 • Net Profit Var (%) 21.47 20.98 974.62 11.Key Financials Latest Qrtr.71 5257.63 4868. 2011 Mar.95 • Net Profit (Rs.6 crore while nearly a dozen private insurers accounted for the rest 25.00 • EPS (Rs) 21.00 47.2.934.82 per cent.81 • CPS (Rs. .) 20.10 • P/C Ratio 11.pie chart showing market position of LIC Market Share Insurance giant LIC had a healthy market share of 74. • Year End Jun.00 MARKET POSITION OF LIC Fig 4. Full Yr.00 • P/E Ratio 10.00 36. 2011 • Sales (Rs.40 • Operating Profit Margin 90.40 • Div% 175. 2011 Jun.

000 crore had been already invested. The popular unit-linked insurance plans (ULIP) contributed 80 per cent in LIC's new business premium of Rs 39.497.80 crore in State Government and other approved securities.541 crore as compared to the traditional business products.However. "In total LIC planned to invest around Rs 117 lakh crore this financial year of which Rs 52.000 to 12. Rs 73.284. the state..82 crore was invested in Central Government securities.58 crore of which 2. in terms of number of new policies.13.000 crore in equities and preference shares in the current fiscal.643 crore and it intended to invest between Rs 10." he said.24.83 per cent with 3..746 crore in infrastructure and social investments and Rs 44.266.. 2007 stood at Rs 1.owned company enjoyed a much better market share of 82.72.82 crore new policies. LIC’S ACHIEVEMENTS . LIC's investment in the capital market as on March 31. LIC Chairman T S Vijayan said in his presentation of the financial performance in 2006-07.217 crore in bond and debentures. 2007 LIC's total investment was of Rs 6. Rs 64. Till March 31.

20 billion) in death claims.9 million policies generating a first year premium income of Rs. During this period. the Corporation was able to settle 97% of all maturity claims on or before the due date signing out Rs.20 billion) in premiums in 45 days of launch in the year 2009. the corporation settled 577. 664 crore (US$ 2. 5606. For example. Additionally. 52.10 billion) in settlement.Fig 4. 29.20% and in the maturity segment at an exemplary low of 0.000 death claims and 1. LIC sold more than 35. the Corporation’s Jeevan Aastha scheme.92 crore (US$ 11 billion) despite the global slowdown (Source: IRDA). single-premium plan sold about 1.84 million policies collecting Rs.85 crore (US$ 6.44 million maturity claims.10. the corporation paid Rs. To its resounding credit.105. Current figures show the outstanding claims ratio under the death category at no more than 2.3-pie chart showing the Achievements of LIC Achievements During the 2008/09 financial year. It is a remarkable achievement that not .26%.953. LIC has a proud record of innovative products that find instant acceptance and success.90 crore (US$ 1. a closeended.

Even in the field of technology. five years in a row.6 million. .1 million and this will flow through to a record net dividend to farmer shareholders of $13. It was bestowed the Readers’ Digest Trusted Brand Platinum Award. software. LIC was felicitated with the NDTV-Profit Business Leadership award as also the Asia Brand CongressBrand Leadership Award. an increase of $13. and 10. for the 2010/2011year. of $7. In fact. In 2008.2% better than the $151 million recorded in 2008/2009. in both 2008 and 2009. Brand Equity rated LIC as the Most Trusted Service Brand. REVENUE OF LIC Farmer resilience after hard times is reflected in the record performance of dairy farmer cooperative.5 million (or 45%) to $24.3 million. Improved sales volumes resulted in an increase in earnings before interest. LIC continues to report a strong balance sheet with total assets including cash. its brand leadership has been on evidence. taxation and fair value adjustments on biological assets. the CNBC Awaaz Consumer Award in 2009 and the Customer and Brand Loyalty Award in 2009.only has LIC continued to maintain the trust of consumers during the economic downturn but has also been felicitated with several awards. LIC’s innovations and practices were recognized when it won the NASSCOM Award for the Best IT User. LIC emerged as the Top Brand in the Insurance Category in the survey conducted by ACNielsen for Brand Equity.4% ahead of the $136 million achieved during the downturn year of 2009/2010. LIC. 21. LIC underlying net earnings increased from $9. In the same year. In the recent past. land and buildings and bull teams of $236. for instance amongst several awards. LIC revenue was $166 million.1 million to $17.8 million.2 million over the previous year with the equity ratio of the 78% remaining stable. too.

This contrasts with the dividend paid in 2010 of $7. the investment during the year were $22. LIC will pay a record dividend of $13.9 cents per Investment Share and represents a gross yield of 17. and $12. .8 million in 2009.6% on Investment Shares compared to 11.1 million. The 2010/2011 net dividend translates to 8.2% last year.3 million.6 million.4 cents per Cooperative Control Share and 44.3 million. to its Cooperative and Investment Shareholders.Cash flows from operations were strong for the 2010/11 year generating $21. representing 80% of underlying earnings.

3-graph showing the revenues of LIC .Fig 4.

. September 9.15% 11.1. 2011: LIC Housing Finance today announced the launch of a new home loan product “New Advantage 5”.2011 with a condition that the first disbursement should be availed by the customer on or before 15.LIC Housing Finance fixed rate home loan product “New Advantage 5” Mumbai. The fixed rate of interest for the first five years is as follows:- For loans up to Rs 30 lacs: Loans above Rs 30 lacks & less than Rs 75 lacks: Loans of Rs 75 lacks up to Rs 150 lacks: 11.40% 11.65% The scheme is available till 31. This product is offered at fixed rates of interest for the first five years and floating rates thereafter.12.2012. The floating rates will be linked to the LHPLR prevailing at the time of the switch.

Suggestions. Limitations .Chapter-5 Conclusion. Findings.

LIC Housing Finance Ltd was promoted by Life Insurance Corporation in 1989 and a public issue was made in 1994. It launched its maiden GDR offering in 2004. As a result. In addition. . the housing company now has only one promoter. the insurance behemoth Life Insurance Corporation.55 per cent in June this year. The company enjoys the highest rating from CRISIL & CARE indicating highest safety with regard to the ability to service interest and repay principal. The stake held by parent Life Insurance Corporation in the company as on September stands at 38.About the Company: LIC Housing Finance Ltd is one of the largest housing finance companies in India having one of the widest networks of 205 offices across the country and representative offices at Dubai & Kuwait.5 per cent. the Company also distributes its products through branches of its subsidiary LICHFL Financial Services Ltd. Promoters of LIC The Unit Trust of India (UTI) and IFCI Ltd have been removed from the list of promoters of LIC Housing Finance Ltd (LICHF) and reclassified as financial institutional investors in the company. down from 64.

including state-run Life Insurance Corp. Phone calls to both institutions were not returned.9 in September. UTI has in fact already reduced its stake in LICHF. The company is also reconciling its accounts as per the US GMP. . They have now realized that focusing on the renewal premium is essential for break-even. Besides. said S.UTI and IFCI held 12. and insurers typically make profits off renewal premiums. while its outstanding mortgage portfolio is likely to cross Rs. Conclusion As the cost of expansion by writing new policies erodes profitability. LICHF has targeted disbursals of Rs 2. the country’s biggest. the company expects to raise debt through the low cost market route over the foreseeable future. 8.B. paid when the policy is due for renewal. On the business front. market sources said the reclassification will enable them to offload their stake in LICHF. Selling a new policy to expand revenue involves large initial costs. respectively. With both UTI and IFCI facing financial problems. This credibility-strengthening initiative is expected to translate into lower cost international funds.000 crore.03 per cent in June and has reduced its holding in LHF to 11.500 crore by the end of the fiscal. There was a tremendous focus on top line (sales) growth earlier. India has 22 life insurance companies. of India Ltd (LIC). It held 12. private life insurance companies are tweaking their business model to focus on renewal premiums rather than market share. The company secretary of LICHF refused to comment on the reclassification.03 per cent and 11.9 per cent.8 per cent to 1. Mathur. It has initiated efforts to reduce interest costs on existing liabilities and expects its spreads to remain in the range of 1. The LICHF share in the market was ruling at Rs 72. an industry body of life insurers. secretary general of Life Insurance Council.59 per cent. known in the industry as new business strain.

operating expense as a percentage of premiums varies between 10 percent and 40 percent for insurers.356 crore in the last fiscal. According to a report by Edelweiss Securities Ltd. The company's total premiums rose 13 percent to Rs 15.750 crore from Rs 27.5 percent a year earlier.In the June quarter. a global consulting firm that specializes in insurance and financial services. and is the biggest determinant of profit. with renewal premium income increasing 61 percent to Rs 8.872 crore. Focus on profitability. Private insurers are also steering away from single-premium policies that generate lower value. The company's expense ratio. a measure of the policies that remain valid.6 percent during the quarter ended June from 14. charging a higher amount in the first year. Companies with lower operating expense ratios have the ability to offset negative variations of persistency. dropped to 11. Single-premium business grew 13 percent to Rs 5. Selling long-term policies will help achieve this.838 crore in the same quarter. Sanket Kawatkar. persistency and renewal premium is important to attain break-even. according to data provided by Life Insurance Council. total renewal premiums for the industry grew 17. Insurers have now introduced front-loaded policies. executive vice-president. said that any company that .4 percent to Rs 8. the country's largest private sector life insurer. to reduce new business strain and lower persistency risks. head (life insurance consulting) at Watson Wyatt Worldwide Inc. said Puneet Nanda.592 crore in the same period.580 crore and that from regular premiums declined by 8.870 crore a year earlier. ICICI Prudential Life Insurance Co.5 percent to Rs 32. Ltd. Regular premium is the money paid as premium over the life of an insurance policy. New business premiums fell 17 percent to Rs 6. or the ratio of operating expenses to premiums. co-authored by Vishal Goyal and Vivek Verma..

most life insurance firms had expected to break even in eight-nine years. This shows that companies are focusing on profitability now. as opposed to capital management. . bottom line (profit) management. etc. Private life insurers had been expanding their branches and distribution channel aggressively over the past few years. but the cost of new business growth came in the way. said Mathur of the Life Insurance Council. Single-premium (business) has started reducing and renewal premium has started growing. Even issues like productivity or efficiency of the distribution channels “established at enormous cost “have been sacrificed to achieve this high topline growth. In India. The private sector life insurers have been mostly selling Ulips.achieves significant growth in new business volumes every year will incur losses until profit from renewal premiums exceeds new business strain. India allowed private insurance firms about a decade ago by dismantling the monopoly of LIC. The problem has been exacerbated by the fact that the business models followed by the private life insurance sector have stressed top line and market share targets.he said. Sales of Ulips rose during the equity bull run that continued until the fourth quarter of 2007-08. and not merely market share. Most of their premium income was generated by unit-linked insurance products (Ulips) that offered market-linked returns..

000 crore.65 crore policies this financial year. Acting LIC chairman A Ramamurthy said the institution wants to sell around 2. Bangalore. LIC has already tied up with Oriental Bank of Commerce. Central Bank.000 crore. Initially. LIC also plans to open a research cell to undertake comparative studies of its products and the private sector ones. In the next few days. LIC has recently opened its first call centre in Mumbai. It is also setting up videoconferencing facilities at its zonal offices. it also plans to open seven more in major cities like Ahmadabad.000 crore of new premiums in 2002-03. some three crore out of the LIC’s existing 13 crore policyholders can make enquiries through the call centre. Delhi. Pune and Chennai. Nedungadi Bank and Bank of Punjab. 87. The target for its sum assured is pegged 25 per cent higher than the last fiscal’s mobilization of Rs 1.COMPANY’S TURNOVER In a bid to maintain its high growth momentum. . Hyderabad. the state-owned Life Insurance Corporation (LIC) has set a target of mobilizing over Rs 20. The institution has ended the last fiscal with a total first premium income of over Rs 15. The institution is also planning to launch some ban assurance products after regulations on allowing banks to sell insurance products are announced.

2. . Most of the customers opted the insurance schemes of foreign countries for the sake of foreign exchange. LIC has a very large service centre on web but less than any foreign company. 3. Services provided by LIC are not so much backward as compare to foreign companies.FINDINGS Through this research I learned to do analysis of the data which I got from different sources by different ways 1. Customers of foreign insurance companies are satisfied by their services. 4.

Every company must keep in touch with their policy holders. 3. 2. . The branches of LIC must be increased in rural and backward areas. I got to know about many schemes. LIC must provide more web facilities to their customers. 4. LIC providing very good services to its policy holders but it must enhance the scope of dealing in foreign exchange for its customers.SUGGESTIONS After completing the study. These are providing satisfactory services: 1. facilities and working of LIC INSURANCE of India.

Certain type of respondents such as officials and executives or people in high income group may not be easily approachable. 3. 5. It is a taken process. 2. From this study we observed that respondents occasionally hesitate from giving relevant information of their companies or policies. .LIMITATIONS 1. Documentation is not available due to secrecy point of view. 4. Policy sellers do not take interest to give information about the different policies.

licindia. . The study is SECONDARY STUDY. which is www. And the data is collected from the official website of LIC.in .BIBLOGRAPHY I have prepared my MINOR PROJECT REPORT on the topic MARKETING of LIC INSURANCE.

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