30-06-2012, 02:29 PM
PROJECT REPORT ON AWARENESS OF LIFE INSURANCE
AWARENESS OF LIFE INSURANCE.doc (Size: 863 KB / Downloads: 88)
INTRODUCTION
Life insurance is one of those things that no one really likes to think or talk about but if you don’t you may leave your family unprotected.
It’s hard to think about those you leave behind if something happens to you. Your family counts on you every day for financial support: food, shelter, transportation, education, and much more. You and your spouse have plans for your future and dreams for your family: a bigger home, a new business, college education, travel, retirement etc.
Life insurance is all about making sure your family has adequate financial resources to make those plans and dreams come true, if you were to die prematurely. It provides financial protection to help your family to manage after your death.
WHY LIFE INSURANCE!
Though something none of us wants to face, Life insurance is something all of need.
Planning for the financial consequences of a premature death is an essential part of every financial plan. Generally, the consequences are simply too large to ignore and cannot be totally covered with your own resources.
It is normal human tendency to believe that we can continue to maintain the present life style and even improve upon it over the years. While this may turn out to be true in many cases, we cannot afford to ignore the stark reality that untimely death, injury, theft of destruction of property could shatter one’s life style or that of his family. It is to provide for these contingencies that insurance is needed.
In the course of our life we are accosted by risk-that of failing health, financial losses, accidents and so on. Insurance is a means by which life’s uncertainties are addressed in financial terms. It offers a monetary compensation against those losses.
INVESTMENT
Put simply, the building up of savings while safeguarding it from the ravages of inflation. Unlike regular saving products, investment products are traditionally lump sum investments, where the individual makes a one off payment.
RETIREMENT
While it is heartening that people are living longer, there is the attendant problem of sickness, reduction in income, dependence etc. the pension products and health packages of the various insurance companies cater to
some of these needs.
INSURANCE - THE INDIAN SCENE
A thriving insurance sector is of vital importance to every modern economy. First because it encourages the saving habit, second because it provides a safety net to rural and urban enterprises and productive individuals. And perhaps most importantly it generates long-term investible funds for infrastructure building. The nature of the insurance business is such that the cash inflow of insurance companies is constant while the payout is deferred and contingency related.
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. Tracing the developments in the Indian insurance sector reveals the 360degree turn witnessed over a period of almost two centuries.
ORIGIN AND GROWTH OF INSURANCE SECTOR
Insurance in modern form originated in the Mediterranean during the 13th century. The earliest references to insurance have been found in Babylonia, Greece and the Rome. Marine insurance is the oldest form of insurance followed by life insurance and fire insurance.
PRIVATIZATION OF INDIAN INSURANCE INDUSTRY
Even after liberalizing the Indian economy the insurance sector was not opened to private sector. The experience after independence in insurance sector showed that the ultimate objective remained largely unfilled. LIC was self-satisfied due to lack of competition and it had never tried to provide innovative polices. Majority of LIC’s polices were perceived by the public as income tax saving instruments. 10% of LIC of India employees were not insured, which indicates the convince ability of LIC agents. Customer service was another area that had not adequately provided and it was inefficient service. Due to the relatively low spread of insurance in the country the efficiency and quality functioning of the public sector insurance companies and the untapped potential for mobilizing long term financial resources to finance the growth of infrastructure, the government had setup an insurance returns Committee in April, 1993 under the chairmanship of R.N.Malhotra, to suggest reforms in the insurance sector including improving the functioning of the LIC, GIC and strengthening the regulatory system.