Professional Documents
Culture Documents
WHAT IS INSURANCE
The business of insurance is related to the protection of the ECONOMIC VALUES
OF ASSETS. Every asset has a value. The asset would have been created through
the efforts of the owner. The asset would have been created through the efforts of
the owner. The asset is valuable to the owner, because he expects to get some
benefits form it. It is a benefit because it meets some of his needs. The benefit may
be an income or in some other form. In the case of a factory or a cow, the product
generated by it is sold and income is generated. In the case of a motor car, it
provides comfort and convenience in transportation. There is no direct income.
Both are assets and provide benefits.
Every asset is expected to last for a certain period of time during which it will
provide the benefits. After that, the benefit may not be available.
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.
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 19051907 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.
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.
The History of Insurance in India
Some of the important milestones in the life insurance business in
India are:
1912 - The Indian Life Assurance Companies Act enacted as the first statute
to regulate the life insurance business.
1956 - 245 Indian and foreign insurers and provident societies taken over by
the central government and nationalized. 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.
101
23.10.2000
Royal
Sundaram
Name
of the
Alliance
Insurance
Company
Company Limited
HDFC Standard Life Insurance Company Ltd.
104
15.11.2000
105
24.11.2000
107
10.01.2001
109
31.01.2001
110
12.02.2001
111
30.03.2001
114
02.08.2001
116
03.08.2001
10
117
06.08.2001
11
133
04.09.2007
12
135
19.12.2007
14
103
23.10.2000
15
512
01.09.1956
http://www.licindia.in/
16
108
22.01.2001
17
113
02.05.2001
18
115
03.08.2001
S.No.
102 Registration
Number
23.10.2000
Date of Reg.
13
LIC provides life insurance services primarily to the rural masses and the
socially
& economically backward sections of the Indian society.
The mechanism of insurance is very simple. People who are exposed to the same
risks come together and agree that, if any one of the members suffers a loss, the
others will share the loss and make good to the person who lost. All people who
send goods by shipare exposed to the same risk related to water damage, ship
sinking, piracy, etc. those owning factories are not exposed to these risks, but they
are exposed to different kinds of risks like, fire, hailstorms, earthquakes,
lightening, burglary, etc. like this,different kinds of risks can be identified and
separate groups, made including those exposed to such risks. By this method, the
risk is spred among the community and the likely big impact on one is\ reduced to
smaller manageable impacts on all.
If a Jumbo Jet with more than 350 passengers crashes, the loss would run into
several crores of rupees.No airline would be able to bear such a loss. It is unlikely
that many Jumbo Jets will crash at the sametime. If 100 airline companies flying
Jumbo Jets, come together into an insurance pool, whenever one of the jumbo jets
in the pool crashes, the loss to be borne by each airline would come down to a few
lakhs of rupees. Thus, insurance is a business sharing
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.
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.
Rewarding Career
A Successful Team
Independence
Financial Strength
Attractive Remuneration
Operations of LIC
INSURANCE ADVISOR
What does an LIC agent do?
Most people have their first contact with an insurance company through an
insurance sales agent. These workers help individuals, families, and businesses
select insurance policies that provide the best protection for their lives, health, and
property.
Insurance sales agents who work exclusively for one insurance company are
referred to as captive agents. Independent insurance agents, or brokers, represent
several companies and place insurance policies for their clients with the company
that offers the best rate and coverage.
In either case, agents prepare reports, maintain records, seek out new clients, and,
in the event of a loss, help policyholders settle their insurance claims. Increasingly,
some are also offering their clients financial analysis or advice on ways the clients
can minimize risk.
Insurance sales agents, commonly referred to as producers in the insurance
industry, sell one or more types of insurance, such as property and casualty, life,
health, disability, and long-term care.
Property and casualty insurance agents sell policies that protect individuals and
businesses from financial loss resulting from automobile accidents, fire, theft,
storms, and other events that can damage property. For businesses, property and
casualty insurance can also cover injured workers compensation, product liability
claims, or medical malpractice claims.
Life insurance agents specialize in selling policies that pay beneficiaries when a
policyholder dies.
Depending on the policyholders circumstances, a cash-value policy can be
designed to provide retirement income, funds for the education of children, or
other benefits. Life insurance agents also sell annuities that promise a retirement
income. Health insurance agents sell health insurance policies that cover the costs
of medical care and loss of income due to illness or injury.
They also may sell dental insurance and short- and long-term-disability insurance
policies.
The growth of the Internet in the insurance industry is gradually altering the
relationship between agent and client. In the past, agents devoted much of their
time to marketing and selling products to new clients, a practice that is now
Career
Career development is emphasized upon from the very day the agent joins the
system. Though individual meetings with his or her Development Officer, the
agent can discuss various issues related to business development and career
enhancement.
Absorption into the management is another career enhancement option provided at
LIC. This program helps agents build a full time career as a Development Officer
in the organization, offering great potential for managing a team of agents and
personal development.
ADVISORS RECRUITMENT
A simple step-by-step guide on how to become an LIC agent
ELIGIBILITY:
12thstandard pass
Age 18 and above
PROCESS:
Contact your nearest Branch Office and meet the Development Officer there.
The Branch Manager (I/C) will conduct an interview, and if found suitable, you
will be sent to training at Divisional/Agency Training Centre.
The training is for 100 hours and covers all aspects of Life Insurance Business.
After successful completion of training you will have sit for Pre-Licencing
examination conducted by the Insurance Regulatory and Development Authority
(IRDA).
After successful completion of the examination you will awarded a Licence by the
IRDA to work as an insurance agent.
You will be appointed as an agent by the Branch Office and you will be a part of
the team under your Development Officer.
The Development Officer will impart you field training and other valuable inputs
which will help you in the market place.
especially during the start of your career. One important quality is the ability to
recognize that each rejection brings you one step closer to a sale
A life insurance agent plays a very vital role in your financial planning and
helps you to purchase the life insurance policy. He does the following for the
customer:
o Help you to choose the Life Insurance Plan which best suits your
requirement according to your need analysis and product review. He is
the one who is informed about the product review and history and
after doing a successful need analysis of your financial requirements,
he is the one who will be able to guide and help you to select the
product that you need to purchase and why.
o Helps you to apply for the policy by fulfilling all the norms of the
insurance company.
o Liaisons between the insurer and prospective customer to fill up the
form, file the necessary documents and do the medicals, if any. Since
he is a representative of the insurer to the customer and vice versa, he
is the one who is the connection between the two and hence plays a
very vital role.
o Once the policy is enforced, the Life Insurance Agent is the one who
is responsible for ensuring that the renewal premiums are paid on
time. This is done diligently by most sincere life insurance agents as
their renewal commissions are based on the renewal premiums paid
by the customers.
o Policy servicing- address change, nominee change, fund switch,
partial withdrawal, top up, loan, etc. are usually taken care by the life
insurance agent because
They need to be in the good book of the customer so that he
would recommend him to another prospective customer or take
another policy from him
And also because they are the connection between the insurance
company and the customer and represent each in front of the
other!
o Filing the claim
In Maturity Claim- the Life Insurance Agent needs to ensure
that the cheque reaches the customer well before time so that
the amount can be claimed on time.
In Death Claim- it is the duty of the Life Insurance Agent to
help the nominee to file the claim and ensure that the death
There are many duties which encompass the role of an agent. The first duty of an
agent is to locate either a buyer or seller of a piece of property. If the agent is
representing the seller of a property, the agent must locate prospective buyers for
the property through advertising and other means. In the alternative, if the agent
represents the buyer, that individual must help the buyer locate a particular
property and get in contact with the seller.
Another specific duty of the agent is to contact numerous parties responsible for
the possible purchase or sale of real estate. Corresponding with various parties is a
frequent duty of the agent. There are many individuals and parties who need to be
contacted throughout real estate transactions such as buyers, sellers, mortgage
companies, attorneys, utility companies and more.
The agent is also the party who is responsible for procuring real estate contracts
when an individual purchases, sells or rents a piece of property. These contracts
and accompanying documents are crucial for the completion of a real estate
transaction and the burden of completing this type of paperwork falls on the
agents.
Once a piece of property has been located, the agent is the individual who shows
the property to the client or for the client, depending upon who the agent
represents. If the agent represents the seller in a real estate transaction, the agent
will make the property accessible to the buyer and his/her agent. If the agent
represents the buyer in a transaction, the agent will accompany the buyer to view
the property and make necessary arrangements with the sellers agent in order to
do so.
An agent must also negotiate on behalf of their client during real estate
transactions. This occurs frequently with regard to price and settlement dates as
well as discussing any items that are to be included within the property purchase.
The agent for the buyer will try to obtain the lowest price and the agent for the
seller will aim for the highest price.
Lastly, the real estate agent is responsible for attending settlement with his/her
client. This is the real estate closing where all documents are signed in order to
complete the purchase and sale. The agent will explain all pertinent documents to
the client and show the client what and where to sign.