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•Insurance can be defined as “a legal contract between two parties whereby one party called insurer undertakes to pay a fixed amount of money on the happening of a particular event, which may be certain or uncertain.”
potential in the Indian Insurance Industry. • Insurance constitutes one of the major segments of the financial market. • Insurance services play predominant role in the process of financial intermediary. • Right now the insurance industry has great opportunities in a country like India or China which huge population. it has improved in terms of efficiency. • India's insurance sector is zooming to show an unprecedented progressive growth of more than 200% by the period of 2009-12 • . Though market share of LIC has been affected. Today. insurance industry is one of the most growing sectors in India. Another major issue is the effects on LIC after the entry of private players in the market.
•107 insurers amalgamated and grouped into four companies viz. the existing rule says that a foreign partner can hold 26% equity in an insurance company.. the Oriental Insurance Company Ltd. the National Insurance Company Ltd.INSURANCE IN INDIA •The insurance sector in India has come a full circle from being an open competitive market to nationalization and back to a liberalized market again. and the United India Insurance Company Ltd. a proposal to increase this limit to 49% is pending with the government. Government may in near future allow 49% FDI in Insurance. the New India Assurance Company Ltd. . GIC incorporated as a company. This would lead to more capital inflow by foreign partners. •Though..
and together with banking services adds about 7% to India’s GDP. • • India also has the highest number of life insurance policies in force in the world. • • It has been growing by 15 . .20% per annum.Size OF INDUSTRY: • Insurance is an Rs.400 billion business in India. and total investible funds with the LIC are almost 8% of GDP.
Change In Market Share From 2006 .
Market Share Of Life Insurance Companies .
a person with insurance coverage. • • Insurer: • A company licensed to transact the business of insurance and issue insurance policies.Basic Terms: • Insured: • The person known as the policyholder. • . • • Policy: • It's the written contract between an insurance company and its insured. It defines what the company agrees to cover for what period of time and describes the obligations and responsibilities of the insured.
• • Claim: • It's the notice to the insurance company that under the terms of a policy.Basic Terms • Premium: • It's the amount of money a policyholder pays for insurance protection. . • • Indemnity: • An insured should not collect more than the actual cash value of a loss but should be restored to approximately the same financial position as existed before the loss. a loss maybe covered.
gender. health. • • Underwriting: • The process of classifying applicants for insurance by identifying characteristics such as age. .Basic Terms • Limit: • It's the maximum amount paid by the insurance company under the terms of a policy. occupation and hobbies.
20000.Life Insurance •Life insurance is a contract that pledges payment of an amount to the person assured (or his nominee) on the happening of the event insured against. •Life insurance is universally acknowledged to be an institution. substituting certainty for uncertainty and comes to the timely aid of the family in the unfortunate event of death of the breadwinner. which eliminates 'risk'. . •Under Section 80 C 20% deduction is given on the premium amount on a maximum of Rs.
the insurance company pays a specific lump sum to the designated beneficiary in case of the death of the insured.The premium payable on these policies is low as they do . 10. get any money at the end of the policy. Over the page of 60. •These policies are usually for 5. 15. these policies become difficult to afford. 20 or 30 years. . ADVEANTAGS OF TERM LIFE INSURANCE DISADVANTAGES OF TERM LIFE INSURANCE . he / she does not not carry any cash value. .One can afford for quite high value insurance policies The premium on such policies keeps on increasing with age mainly because the risk of death of older people is more.If one survives the period of the policy.TERM LIFE INSURANCE •Under a Term Life contract.
this policy will accumulate certain "cash value" which you will be able to get back either during the period of the policy or at the end of the policy. and the sum assured is payable by the insurer on death. over a period of time.WHOLE LIFE POLICY • The premiums under this plan are payable from the date of commencement to death of the date of the life assured. over a period of time. • . • Thus. • A portion of the money paid as premiums is invested in a fund that earns interest on a tax-deferred basis. this policy will accumulate certain "cash value" which you will be able to get back either during the period of the policy or at the end of the policy. • Thus. • A portion of the money paid as premiums is invested in a fund that earns interest on a tax-deferred basis.
is the endowment policy. which is a very fine combination of term assurance and endowment in equal amounts.ENDOWMENT POLICY •The most popular plan of life insurance. •An endowment plan provides for the payment of the sum assured at the end of a specified term or earlier death. whereby the person covered remains alive beyond the tenure of the policy. he gets back the sum assured with some other investments . •A pure endowment policy is therefore a form of financial saving.
The money back plan is a typical example of an interest sensitive product where a lump sum is paid periodically without affecting the amount of insurance cover. 10yrs. the designated beneficiary will get the full sum assured without deducting any of the survival benefit amounts. These policies provide for periodic payments of partial survival benefits during the term of the policy itself. Moreover. . the bonus on such policies is also calculated on the full sum assured. which have already been paid as money-back components. within the term full sum assured is paid without deducting survival benefit already paid. A unique feature associated with this type of policies is that in the event of death of the insured during the policy term.MONEY BACK POLICIES It is a combination of whole life and endowment type plans. 15yrs or 20yrs depending on the term initially chosen. MONEY BACK PLAN: Money back plans are of special interest to proposers who want periodical payments in which a percentage of sum assured is paid to the life assured as a survival benefit on surviving 5yrs. In the event of death. However no loans are granted under this plan.
ANNUITY / PENSION POLICIES / FUNDS This policies / funds require the insured to pay the premium as a single lump sum or through installments paid over a certain number of years. either for life or for a fixed number of years. the insurer stops paying upon death of the annuitant. In annuity contracts. It is called the reverse of life insurance. for life on other agreed terms or conditions. under a life insurance contract. in returns for a single payment or series of payments (consideration account). half yearly or annually). The insured in return will receive back a specific sum periodically from a specified date onwards (the returns can can be monthly. . Annuity may be defined as a series of periodic payment to an annuitant (the person receiving the benefit).ANNUITIES Annuities start where life insurance ends. In actual practice however. Annuities / Pension funds are different from fromall other forms of life insurance as an annuity policy / fund does not provide any life insurance cover but merely offers a guaranteed income either for life or a certain period. this type of insurance is taken so as to get income after the retirement. the invested annuity fund is refunded. Theoretically. Therefore. The risk that is sought to be covered under annuity contracts is of living too long. or after the fixed annuity period expires for annuity payments. In case of the death of the insured. there are many variation of the annuity contribution. the insurer starts paying upon the death of the insured and under an annuity contract. a person agrees to pay to the insurer a specified capital amount in lump sum or in installments in returns for a promise from the insurer to make a series of payment to him so long as he lives. usually with some additional amounts as per the terms of the policy.
there are few products that are long-term. • Injury due to accident or hospitalization for illness and surgery can also be insured.General insurance • Insuring anything other than human life is called general insurance. . However. • Your liabilities to others arising out of the law can also be insured and is compulsory in some cases like motor third party insurance • Most general insurance covers are annual contracts.
•In a replacement value policy. fire insurance may pay out the actual value of the property after the fire. the structure will be replaced in the event of a fire. or it may pay out the replacement value.Fire Insurance •Fire insurance is a form of property insurance which protects people from the costs incurred by fires. •Depending on the terms of the policy. the insurance policy will pay out in the event that the structure is damaged or destroyed by fire. •When a structure is covered by fire insurance. whether it has depreciated or appreciated: .
Marine Insurance •Marine insurance covers the loss or damage of ships. ports. or held between the points of origin and final destination. and any transport or cargo by which property is transferred. though Marine also includes Onshore and Offshore exposed property (container terminals. oil platforms. . pipelines). •Cargo insurance—discussed here—is a sub-branch of marine insurance. terminals. acquired. cargo.
•Its primary use is to provide financial protection against physical damage and/or bodily injury resulting from traffic collisions and against liability that could also arise therefrom. •The specific terms of vehicle insurance vary with legal regulations in each region.Auto insurance •Auto insurance (also known as vehicle insurance. trucks. motorcycles. or motor insurance) is insurance purchased for cars. gap insurance. and other road vehicles. car insurance. .
such as a monthly premium to ensure that money is available to pay for the health care benefits specified in the insurance agreement .Health insurance • Health insurance is insurance against the risk of incurring medical expenses among individuals. an insurer can develop a routine finance structure. By estimating the overall risk of health care expenses among a targeted group.
• • Be it a humble hut or a bungalow. jewelry etc. it is advisable to insure your house and belongings to guard against unforeseen risks. and you should purchase one. rented or owned. • • In addition to protecting your home. the typical home insurance covers your valuable personal property as well. or house-owner/householder insurance as it is also known. is important.Home insurance • Home insurance. . computer equipment. clothing. Your personal property could consist of your furniture. stereo.
Travel Insurance •Travel insurance is insurance that is intended to cover medical expenses. •Temporary travel insurance can usually be arranged at the time of the booking of a trip to cover exactly the duration of that trip. . and other losses incurred while traveling. or a "multi-trip" policy can cover an unlimited number of trips within a set time frame. financial default of travel suppliers. either within one's own country. or internationally.
limits and clauses specific to aviation insurance. as well as terminology.Aviation insurance • Aviation insurance is insurance coverage geared specifically to the operation of aircraft and the risks involved in aviation. • Aviation insurance policies are distinctly different from those for other areas of transportation and tend to incorporate aviation terminology. .
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