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Utkarsh

News Bulletin of CO Marketing dept., September 2009


(For Private Circulation Only)

Greetings from the Central Office Marketing Dept. On the glorious occasion of the 53rd
Insurance Week, let us celebrate our achievements and gear up for a brighter future.

LIC Market Share in July 2009:


In July 2009, our Market Share on FPI count,
increased remarkably by 2.41% from 62.45%
to 64.86%. On NOP count it has decreased
slightly by -0.10% from 69.88% to 69.78%.
Our Market Share in FPI has increased for
four months in continuity. Recently, three
Competitions (namely Chandrayaan-II in
July-09 and Saral Swarnim Suraksha & AAA
in August-09) have been launched for the field
force. Let us make the best use of these
competitions to continue our impressive gains
in respect of FPI and NOP both.

LIC Vs. Industry Growth Rate in 07/2009:


Growth Rate

FPI Count

LIC

32.13%

14.86%

-17.59%

-2.06%

9.01%

9.16%

Pvt. Insurers
Industry

NOP Count

Our Performance in August, 2009:

Grand Achievement of Neyvely B.O.:


Our congratulations to Team Neyvely B.O.
and Vellore D.O. Neyvely became the First
Branch to achieve NOP target in F.Y. 200910 by completing 16830 policies on 24.08.09
against NOP budget of 16,000 policies.
We look forward to having many more such
Achievers by the time of release of next
Issue of Utkarsh.

Saral Swarnim Suraksha- a N.B.


Competition for DOs & Agents:
This N.B. Competition for Development Officers
and Agents has been launched to encourage
them to cover good no. of lives consistently with
higher premium in short duration. The policies
sold under New Janraksha, Jeevan Saral, and
New Bima Gold plans and having SA 1 Lac or
more will be considered for this competition.
The Competition period is from 1st August, 2009
to 31st January 2010. All Branch Officials are
requested to bring this to notice of all
Development Officers & Agents.
(Refer Circular Ref.:Mktg/ZD/18/2009 dated 08.08.2009 and
Circular Ref.:Mktg/ZD/21/2009 dated 25.08.2009 for details)

In August 2009, the Corporation registered


Triple A Competition - Arise, Awake &
growth of 13.19% at FPI count and 19.25% on
Achieve- for CLIA & Dy / Managers(CLIA):
NOP count. The FPI Growth rate increased a
The CLIA dept. has floated a New Business
bit but is still far below the budgeted growth.
competition for CLIAs and Deputy / Managers
period is from 1st
Top 2 Zones & Divisions on Growth Rate: (CLIA). The Competition
st
August, 2009 to 31 October 2009. All Branch
Particulars FPI Count
NOP Count
Officials are requested to bring this to notice of
all Chief Life Insurance Advisors.
WZO,
NZO,
Topper
(Refer CLIA dept. Circulars dated 31.7.09 for details)
Zone
24.97%
31.08%
Changes in Recruitment of RCAs by DOs:
NCZO,
Runner Up NZO,
To provide stimulus for agents recruitment, the
Zone
21.25%
26.95%
rules have been relaxed. Now while calculating
Delhi-I,
Srinagar
Topper
the limit of four RCAs under a Development
Division
Officers, only those agents who are recruited
70.84%
61.17%
under RCA Scheme and are within the
Udupi,
Runner up Mumbai-I,
stipendiary period i.e. 2 years of his / her
Division
66.85%
58.15%
agency, will be taken into account.
*Bold indicates continuation of / improvement in position.

(Refer Circular Ref.:Mktg/ZD/22/09 dated 27.8.09 for details)

Rules on Allotment of Agents to DOs:


Merit Lists as on 31st July, 2009
With multiple objectives of arresting high
incidence of termination of agents, conserving Top 3 Branches on Growth Rate Basis:
the already created agency force, to support
Rank FPI Count
NOP Count
Probationary Development Officers and to
st
1
Nurpur, 15 B
Nurpur, 15 B
facilitate existing Direct Agents to reach higher
438.58%, (NZ) 440.98%, (NZ)
level of performance, the Rules on allotment of
nd
Agents to Development Officers have been
New Friends Colony, Mandi BO, 167
2
revised.
352.43%, (NZ) 266.91%, (NZ)
(Refer Circular Ref.:Mktg/ZD/19/2009 dated 10.08.2009 for details)

rd

Mandi BO, 167 Neyvely, 71E


Modifications in Rules of Reinstatement
249.33%, (NZ) 246.24% (SZ)
and Reappointment of Terminated Agents:
With the objective of conservation of agency Top Ten Development Officers(FPI Count):
force, the existing rules for reinstatement and
Sr.
Name
FPI
reappointment of the terminated agents have
(In
Rs.
Crs.)
No.
been modified with immediate effect.
(Refer Circular Ref: CO/Mktg/ZD/26/2009 dated 04.9.2009 for details)
1. Shri H.K. Sinha, (NZ)
6.89
Products of the Month for September
2009 - Jeevan Saral and Profit Plus:
Jeevan Saral, a traditional plan and Profit
Plus, a Unit linked plan are Products of the
Month for September-2009. Together, these
two plans provide optimum combination of
affordable risk coverage and diversified asset
allocation to our policy holders.

2.

Shri Harish Gupta (NZ)

5.97

3.

Shri G.K. Singh,

(NCZ)

5.91

4.

Shri S.K. Mathur

(WZ)

5.90

5.

Shri R. Pradeep

(SZ)

4.95

6.

Shri Vipin Gupta

(NZ)

4.82

7.

Shri Govind Gupta, (NZ)

4.57

8. Shri S. Joshi
(NZ)
4.38
Exercise of Option by CMs Club Members:
The CO Marketing Dept. has announced the
9. Shri Sanjay Garg, (NZ)
4.37
Options for CMs Club Members (M.Y. 2008-09).
10. Shri P.P Shetty
(WZ)
4.12
Apart from three existing Options, namely
attending Convention, Visiting a place of choice
Top Ten Agents (FPI Count):
with spouse and Attending a Training
Programme, a new Option of Reimbursement up
Sr.
Name
FPI
to Rs.12,000/- for holding Customers Meet and
(In
Rs.
Crs.)
No.
purchasing certain business promotion articles /
1. Ms. Ragini,
(NZ)
6.80
utilities has been provided.
Now, in the option of visiting a place of choice
2. Smt. Manisha
(NZ)
4.09
with spouse, reimbursement may be claimed on
3. Ms. R.D. Pal,
(NCZ)
4.02
the basis of declaration subject to tax deduction.
4. Shri H.R. Shah
(WZ)
4.00
The Zonal Offices are requested to provide the
Options data to CO Marketing dept. by
5. Smt. A. Bhalerao, (NZ)
3.24
08.09.2009.
(Refer Circular Letter dated 17.8.09 on CO Mktg. dept. site for details)
6. Shri MRC Rao, (SCZ)
3.12
Agents PRT: Online Training & Process Flow:

7.

Shri K.V. Paulson

(NZ)

2.88

Instructions regarding On-line pre recruitment


test training through LICs own VIDYANET
server and Process flow for the online prerecruitment test of prospective agents have
been announced.

8.

Ms. K. Gupta,

(NZ)

2.67

9.

Smt. R. Aggarwal

(NZ)

2.64

10.

Shri H.V. Goenka (WZ)

2.63

(Refer CO FPT Circulars dated 06.08.2009 & 13.08.2009 for details)

*Names displayed in Bold indicate continuation of the


position or upward movement in the respective Merit List.

Amendments to Agents MBG:


Around 2500 years ago, Heraclitus (540 B.C.
480 B.C.) said that nothing endures but change.
Since, then this eternal truth has been rephrased
again and again so many times.
How LIC Agents have progressed since 1972:
Below-mentioned figures speak for themselves:
1. Total N.B, in certain Representative F.Y.:
Year

Policies

S.A.(Crs)

FPI (Lac)

1971-72

1895875

1498.05

N.A.

1981-82

2103134

3478.92

10194

1991-92

9238264

32064.44

86169.18

2001-02

23249651 192572.31

1484332.07

2007-08

37589995 275457.65

4381285.77

The MBG provisions, which were introduced in


1972, have been changed w.e.f. 09.07.2009 i.e.
after a period of 37 years.

2. Per Agent Average N.B. in these F.Y.:


Year

Average
No. of
Policies.

Average
S.A. (Rs.)

Average
FPI (Rs.)

1971-72

11.67

92268.88

N.A.

1981-82

16.88

279231.71

8182.10

1991-92

18.86

654830.69

17597.75

2001-02

29.35

2431124.76 187389.16

2007-08

31.48

2307510.23 367020.54

3. Total No. of Agents in these F.Ys.:


Year

Total No. of Agents at F.Y.-end

1971-72

162357

1981-82

124589

1991-92

489660

2001-02

792112

2007-08

1193744

The change in agents performance from


1971-72 to 2007-08 is phenomenal and
thus the change in MBG decided in 1972
is inevitable.
The customers preference for ULIP policies
and Term Plans have made concept of Sum
Assured irrelevant. A policy having S.A. 25
Lacs under Plan 190 may have yearly
premium as low as Rs.6000/-.
It may be observed that the earlier MBG,
introduced in 1972 was higher than the
then average performance (Min. 12 lives
against Avg. 11.67 policies and Min. 1 Lac
S.A. against Avg. 0.92 Lacs S.A.).
The No. of Lives condition has not been
changed and is same i.e. 12 Lives. The
changes are as following:
Agents MBG, Rule 9 (1) & (2):
In first three Agency Years, an Agent will have to
complete policies on minimum 12 different lives
and bring at least 1 lac First Year Premium
Income.
rd
Condonation: However, at the end of 3 Agency
Year, shortfall on any one count shall be
condoned up to a maximum of 50%, if it is
compensated with same or higher percentage on
the other count and the agent completes at least
six different lives and FYP Income of Rs.50.000/st
nd
rd
in each of 1 , 2 and 3 Agency Years.
In fourth and subsequent Agency Years, an Agent
will have to complete policies on minimum 12
different lives and bring at least 1 lac First Year
Premium Income. The Condonation will not be
applicable from fourth Agency Year onwards.
The 1 Lac FYP condition is much lower than

the average FYP performance of agents for


many last F.Ys. The First Year Premium
includes First Premium and First Year
Renewal Premium (FYP= FP + FYRP) and is
generally higher than First Premium. These
facts are evident from following data:
Year

Average Per Agent First


Premium (FP) Year Premium (FYP)

It is observed that from data that since 1972,


per Agent average productivity has risen from
11.67 to 31.48 in NOP, from 0.92 Lacs to
23.07 Lacs in respect of S.A. and from less
than 0.08 Lacs to 3.67 Lacs in respect of FPI.
The S.A. has grown at CAGR of 9.10% in last
37 years. Assuming Average FYP Rs.7000/for S.A. I Lac, FYP would grow to Rs.1.75 Lacs
(The actual FYP figure is Rs.4.95 Lacs).

2003-04

1,40,203

1,48,000

2004-05

1,27,397

1,89,000

2005-06

1,66,535

2,43,000

2006-07

3,52,120

5,07,000

2007-08

3,67,020

4,95,000

Clearly, new MBG condition is quite liberal.

At 15% average commission rate (a presumed


rate only, actual rate will depend upon agents
business mix i.e. ratio of Traditional vs. ULIP
and Single Premium vs. Non-single Premium),
the commission amount would be 15,000/p.a. or Rs.1250/- p.m. Even the minimum
guaranteed NRGES wage is Rs.80/- per day.
If we want our agents to take agency career
seriously, their earning should be reasonably
good enough to match current economic
environment.
The external environmental factors such as
inflation, rising per capita income, opening up
of Insurance sector and overall economic
scenario (which have contributed to rise in
agents performance to a large extent) had
made the earlier MBG irrelevant. The revised
MBG will contribute to our agents becoming
professionals, successful and prosperous.

IRDA has put cap on ULIP Charges:


st

From 1 October, 2009, IRDA has prescribed a


limit on all ULIP related charges. For ULIPs having
term less than or equal to 10 years, the difference
between the gross and net yield should not exceed
3% and for term more than 10 years, it should not
exceed 2.25%. The Fund Management Charges
should not exceed 1.35%. This will apply to all
(existing as well as new ULIP plans.

Update on SBA Scheme:


As on 31.08.2009, 486 Development Officers
have enrolled in SBA Scheme and 370 of them
have become active. Total collection by SBAs
so far is Rs.72.59 Crores.

The Top Three SBAs:


Name

Collection

Update on MDRT-2010:
1. As against the FYC Earning targets decided in
CMC, the no. of prospective Agents at various
thresholds are as following:

Zone

>= 3 Lacs

>=3.75 L.

>=4.5 L.

CZ

142

81

46

EZ

306

181

118

ECZ

154

79

44

NZ

703

423

268

NCZ

251

141

89

SZ

318

185

110

SCZ

319

188

115

WZ

1695

1051

715

Total

3888

2329

1505

The FYC Earning Targets for Sept.-09 & Oct.-09


are 5.50 Lacs and 6.50 Lacs respectively. Our
goal is to ensure that all these 3,888 agents
should qualify MDRT latest by Nov.-09.

2. MDRT Qualifiers as on 31.08.2009:


Type

Pre. Basis

Comm. Basis

TOT

COT

33

24

MDRT

510

359

(Inclusive of Qualifiers on Both counts)

3. MDRT 2009 The Top Ten Achievers:


Sr.
No.

Name

FYC*
(Rs. Lacs.)

1.

Shri Ravi Jethani,

(WZ)

134.30

2.

Shri K.S. Saji,

(SCZ)

99.83

3.

Shri Bharat V. Parekh (WZ)

89.82
83.44

Shri H. Gupta,

(NZ)

2.45 Crs.

4.

Shri Hitesh M. Shah

Shri Davinder Kala, (NZ)

1.10 Crs.

5.

Ms. Ragini,

Shri Jaswant Rai

1.05 Crs.

6.

Shri Samir D. Parikh (WZ)

77.23

7.

Shri Sunil S. Sohoni (WZ)

70.30

8.

Shri P.S. Mehta

(WZ)

61.90

9.

Shri Prabhudas

(SCZ)

54.56

10.

Shri R.K. Shetty

(WZ)

46.59

(NZ)

SBA related queries Whom to contact:


1. For FUP updation related queries: Mail to
bo_cbk1@licindia.com or call 022-67819479.
2. For all other queries: Call 022-67090501 /02
or Mail to dev_support@licindia.com.

(WZ)

(NZ)

79.72

*FYC Excluding Bonus Commission

Another reason to perform and celebrate: the All India Ace Competitions for Agents and
Development Officers have also been announced. Refer to CO Mktg. dept. site for details.
[Printed & Published by Narendra M. Ojha for and on behalf of LIC of India- printed at Max Print SYSTEM (BOM) PVT. LTD.
and published at Yogakshema, Jeevan Bima Marg, P.B. No.19953, Mumbai 400 021. Please mail achievements
pertaining to Mktg. dept./Field force and feedback/suggestions to co_marketing@licindia.com & nm.ojha@licindia.com]