MISSION

To protect the interests of the

policyholders, to regulate, promote and
ensure orderly growth of the insurance
industry and for matters connected
therewith or incidental thereto.
 INSURANCE BUSINEES
• Insurance business is divided into four
classes :
• 1) Life Insurance
• 2) Fire Insurance
• 3) Marine Insurance and
• 4) Miscellaneous Insurance.
• Life Insurers transact life insurance
business; General Insurers transact the
rest.
• Insurance provides financial protection
against a loss arising out of happening of
an uncertain event. A person can avail this
protection by paying premium to an
insurance company.
• A pool is created through contributions
made by persons seeking to protect
themselves from common risk. Premium is
collected by insurance companies which
also act as trustee to the pool. Any loss to
the insured in case of happening of an
uncertain event is paid out of this pool.
• Insurance works on the basic principle of
risk-sharing. A great advantage of
insurance is that it spreads the risk of a
few people over a large group of people
exposed to risk of similar type.
• Insurance is a contract between two parties
whereby one party agrees to undertake the risk
of another in exchange for consideration known
as premium and promises to pay a fixed sum of
money to the other party on happening of an
uncertain event (death) or after the expiry of a
certain period in case of life insurance or to
indemnify the other party on happening of an
uncertain event in case of general insurance.
• The party bearing the risk is known as the
'insurer' or 'assurer' and the party whose
risk is covered is known as the 'insured' or
'assured'.
 Need for Insurance
• All assets have some economic value attached
to them. No person can deny that there is also a
possibility that these assets may get
damaged/destroyed or become non-operational
due to risks like breakdowns, fire, floods,
earthquake etc.
• Different assets are exposed to different types of
risks like a car has a risk of theft or meeting an
accident, a house is exposed to risk of catching
fire, a human is exposed to risk of
death/accident. Insurance is needed because of
following reasons:
 Social Security Tool
• Insurance acts as an important tool providing a sense of
security to the society on a whole. It is the right of every
human-being to have basic amenities like food, clothing,
housing, medical care, standard of living necessary for
his personal and family's well being, and right to security
in case of unemployment, disability, sickness or any
other circumstances out of his control.

In case the bread earner of a family dies, the family

suffers from direct financial loss as family's income
ceases. As a result, family's economic condition gets
affected unless there are other
 Uncertainty
• The basic need of insurance arises as
risks are uncertain and unpredictable in
nature. Getting insurance for an asset
does not mean that the asset is protected
against risks or its exposure to risk is
reduced, but it actually implies that in case
the asset suffers any loss in value due to
such risk, the insurance company bears
the loss and compensates the insured by
making payment to him.
 Economic Development
• The premium paid by people to the
insurance companies is a part of their
savings. Insurance, thus, acts as a useful
instrument in promoting savings and
investments, particularly within the lower-
income and middle-income families.
These savings are ultimately used as
investments fuelling economic growth.
 General Purposes of Insurance
• Insurance is widely popular and beneficial
because of its following general purposes:
1. Protection or safety (Term insurances) :
These plans are best suited for people
aged upto 35 years as it provides higher
protection at low cost. These plans are
also beneficial for a person whose income
is low and want to secure their family from
financial default in case of his death.
2. Marriage or education of the child
(Children plans)
3. Speedy growth of money & risk cover
(Unit Linked Plans)
4. Saving and Protection (Endowment type
plans)
5. Saving, protection & liquidity (Money back
plans)
 Insurers
• Insurance industry, as on 1.4.2000, comprised
mainly two players: the state insurers:
Life Insurers:
• Life Insurance Corporation of India (LIC)

• General Insurers:

• General Insurance Corporation of India (GIC)

(with effect from Dec'2000, a National
Reinsurer)
• GIC had four subsidary companies, namely
• ( with effect from Dec'2000, these subsidaries
have been de-linked from the parent company
and made as independent insurance companies.
• The Oriental Insurance Company Limited
• The New India Assurance Company Limited
• National Insurance Company Limited
• United India Insurance Company Limited.
 What is Insurance?

Insurance is an agreement between an insurance company and

individual or a business, that if they suffer a particular loss they the
insurance company will Compensate (reimburse) them for the loss.

Notice
only
the loss
mentioned in
the agreement
is covered.
 Pooling of Risks
• Insurance is a pooling of risks, because a lot of
people with similar risks contribute their
premium to an insurance company and hopefully
only a few of them will suffer the loss at a
particular time.
• In addition to the insurance company making a
profit, the premium that the insurance company
receives will go towards compensation of the
unfortunate ones.
• Thus all that take out insurance are contributing
to the loss of the few, who suffer the loss.
 H
G A

Insurance
F company
B

E C
D

Insurance is based on the principle that A, B, C, D, E, F, G, H etc all pay

in Premiums, but the risk only happens to A. However if the accident
also happens to B and C the insurance company makes very little profit
and if it happens to more they will make a loss.
 The person or business that gets
compensated if the loss occurs is known as
the Insured.

The company that agrees to pay

the compensation is known as
the Insurer.

The money that is paid by the

Insured to the Insurer is called
the Premium.
 Premium

The Premium, that The greater the risk of

is the money that is the incident occurring
paid in will be much the greater the
less that the premium. For example
compensation that young drivers have to
will be paid out if pay greater premiums,
the loss is suffer, because more of them
because there has have accidents.
to be a chance that
the loss will not
occur.
 Notice the insurance company will only cover risks that may or may not
happen. For example a fire, a robbery, car accident. These are called
Insurable Risks.
However if you crash your car on purpose, it will not be covered.

Things that one can influence whether it happens or not are called
uninsurable risks. For example passing one’s Leaving Certificate
examination. These are called Uninsurable Risks. He is crazy
taking an
uninsurable
risk

However insurance can be got on ones life, but it is not

whether they will die that is being insured but when they will
die. It is called Life Assurance rather than Life
Insurance.
 The premium depends on three
factors:
• The cost of compensation. This will
depend on the cost of the item insured
and the chance of the risk involved
happening.
• The insurance company’s costs. For
example wages, cost of running their
offices.
• The insurance company’s profits.
The premium depends on three
factors:
Compensation

Premium

Profit Running costs

 Life Assurance
• This is based on when the death will occur.
• It offers protection in the form of financial
security for the family in the event of the death of
a loved one.
• Questions will normally be asked about the
health of the person, whose life is being insured
and if they are a drinker or smoker.
• There are different types of life assurance as
listed in the next slides.
 What is Life Insurance
Life insurance is a contract between several
parties that promises to pay dollars when
a person dies (prematurely).
Life insurance helps protect families by
replacing lost income if a wage earner
dies (prematurely).
Proceeds OR face value: amount paid at
death; amount of insurance.
Insured: person whose death causes
insurer to pay; does NOT necessarily have
to be the policy owner
Policy owner: bought the policy and may
exercise rights under the policy.
Beneficiary: receives the death proceeds.
 Who Needs Life Insurance
• In most cases, you need life insurance only if someone
depends on you for support.
• Single parents and single adults supporting someone
such as an elderly adult.
• Working couples without children or dependent parents
usually do NOT need life insurance.
Why?
• Families (including single-parent households) because
children depend on the parents’ income. The younger
the children, the greater the need for life insurance.
• How about senior citizens?
 How Does Life Insurance
• Transactions Work?
• Similar to other insurance contracts, the
transaction requires:
• The pooling of exposures in order to calculate
losses and make numbers highly predictable.
• See the Standard Ordinary Mortality Table.
• Financing (advance funding) in order to provide
the required cash flow to pay expenses and the
cost of the claims.
 Risk Classification

Age
Gender
Smoking habits
Medical condition
Some insurers used occupation
• Different risk classes:
Preferred (below-average of early death)
Standard (average risk of death)
Substandard (insurable, but with an above-average risk of
death)
Uninsurable (a high probability of early death)
 Need for Life Insurance
• Today, there is no shortage of investment
options for a person to choose from. Modern day
investments include gold, property, fixed income
instruments, mutual funds and of course, life
insurance. Given the plethora of choices, it
becomes imperative to make the right choice
when investing your hard-earned money.
Life insurance is a unique investment that helps
you to meet your dual needs - saving for life's
important goals, and protecting your assets.
S.No. Registration
Life Insurers
Date of Reg. Name of the Company

Number
1 101 23.10.2000 HDFC Standard Life Insurance Company Ltd.
2 104 15.11.2000 Max New York Life Insurance Co. Ltd.
3 105 24.11.2000 ICICI Prudential Life Insurance Company Ltd.
4 107 10.01.2001 Kotak Mahindra Old Mutual Life Insurance Limited
5 109 31.01.2001 Birla Sun Life Insurance Company Ltd.
6 110 12.02.2001 Tata AIG Life Insurance Company Ltd.
7 111 30.03.2001 SBI Life Insurance Company Limited .
8 114 02.08.2001 ING Vysya Life Insurance Company Private Limited
9 116 03.08.2001 Bajaj Allianz Life Insurance Company Limited
10 117 06.08.2001 Metlife India Insurance Company Ltd.
11 133 04.09.2007 Future Generali India Life Insurance Company Limited
12 135 19.12.2007 IDBI Fortis Life Insurance Company Ltd.
13 121 03.01.2002 Reliance Life Insurance Company Limited.
14 122 14.05.2002 Aviva Life Insurance Co. India Pvt. Ltd.
15 127 06.02.2004 Sahara India Insurance Company Ltd.
16 133 04.09.2007 Future Generali India Life Insurance Company Limited
17 135 19.12.2007 IDBI Fortis Life Insurance Company Ltd.
18 136 08.05.2008 Canara HSBC Oriental Bank of Commerce Life Insurance Company Ltd.
19 138 27.06.2008 Aegon Religare Life Insurance Company Ltd.
20 140 27.06.2008 DLF Pramerica Life Insurance Company Ltd.
21 142 Star Union Dai-ichi Life Insurance Co. Ltd.,
 General Insurers
S.No. Registration  Date of  Name of the Company
Number Registrati
on
1 102 23.10.2000 Royal Sundaram Alliance Insurance Company Limited
2 103 23.10.2000 Reliance General Insurance Company Limited.
3 106 04.12.2000 IFFCO Tokio General Insurance Co. Ltd
4 108 22.01.2001 TATA AIG General Insurance Company Ltd.
5 113 02.05.2001 Bajaj Allianz General Insurance Company Limited
6 115 03.08.2001 ICICI Lombard General Insurance Company Limited.
7 131 3/8/2007 Apollo DKV Insurance Company Limited
8 132 4/9/2007 Future Generali India Insurance Company Limited
9 134 16-11-2007 Universal Sompo General Insurance Company Ltd.
10 123 15.07.2002 Cholamandalam General Insurance Company Ltd.
11 124 27.08.2002 Export Credit Guarantee Corporation Ltd.
12 125 27.08.2002 HDFC-Chubb General Insurance Co. Ltd.
• Life Insurer in Public Sector
• Life Insurance Corporation of India
• Life Insurers in Private Sector
• Metlife India Life Insurance
• ICICI Prudential Life Insurance
• Bajaj Allianz Life
• Max New York Life Insurance
• Sahara Life Insurance
• Tata AIG Life
• HDFC Standard Life
• Birla Sunlife
• SBI Life Insurance
• Kotak Life Insurance
• Aviva Life Insurance
• Reliance Life Insurance Company Limited - Formerly known as AMP Sanmar LIC
• ING Vysya Life Insurance
• Shriram Life Insurance
• Bharti AXA Life Insurance Co Ltd
• Future Generali Life Insurance Co Ltd
• IDBI Fortis Life Insurance Co Ltd
• AEGON Religare Life Insurance
• DLF Pramerica Life Insurance
• CANARA HSBC Oriental Bank of Commerce LIFE INSURANCE
 Insurance Industry in India…
13 Private players in the market today:

 6 Bank owned insurers- HDFC Standard Life, ICICI

Prudential, ING Vysya, Metlife, OM Kotak, SBI Life

 7 Independent Insurers- Bajaj Allianz , Birla Sun Life, Aviva,

Max New York Life, Tata AIG, Reliance Life and Sahara Life

 LIC – The state Insurer is the dominant player with over

70% of the market share

 Total Life Market Size at Rs. 250 billion (USD 5.5. Bn)
 Consideration for Insurers…
Immediate access to New
Markets

Improve sales
Increase in Market
effectiveness & after sales
Penetration
service

Insurer

Reduce reliance on
Develop new financial traditional distribution
products more efficiently channel

Combine Cost Saving &

Increased Profitability
Why Take Insurance ?
• Security for the family : Risk of life

• Systematic Saving : Savings for the inevitable milestones in life like

child education , marriage of children , life after retirement etc…

• Investment : Benefit from good corporate performance , Be a Part of

Indian growth story . Sensex has more than doubled in 2 yr. 20
times since inception.

• Tax benefit : Exemption under section 80c and 10(10) d

Some of the Products in Reliance Kitty ??
• We have a wide basket of products , well suited to individual
requirements depending on the age , risk appetite , Family needs.
Life .

• We have best of the Child plans , ULIP plans , Pension Plans , Term
Plans suited to individual specific need.
 Trust in Reliance ??
• Seeking an individual appointment with each one of you at your
place and time of convenience so that we can understand you better
and suggest you the plan well suited to your needs..

Looking forward to an opportunity to

offer Best Products and Services to
You .