Insurance

The Life Insurance Corporation (LIC) was established in India with a view to provide an insurance cover against various risks in life. A monolith then, the corporation, enjoyed a monopoly status and became synonymous with life insurance. Its main asset is its staff strength of 1.24 lakh employees and 2,048 branches and over six lakh agency force. LIC has hundred divisional offices and has established extensive training facilities at all levels. At the apex, is the Management Development Institute, seven Zonal Training Centers and 35 Sales Training Centers. LIC of India is one of Indias leading financial institutions, offering complete financial solutions that encompass every sphere of life. From commercial banking to stock broking to mutual funds to life insurance to investment banking, the group caters to the financials needs of individuals and corporate. The LIC has a net of over Rs. 1,800 crore. With a presence in 82cities in India and it services a customer base of over 20, 00,000. At the industry level, along with the Government and the GIC, it has helped establish the National Insurance Academy. It presently transacts individual life insurance businesses, group insurance businesses, social security schemes and pensions, grants housing loans through its subsidiary; and markets savings and investment products through its mutual fund. It pays off about Rs 6,000 crore annually to 5.6 million policyholders. It has been started with the objectives of spreading Life Insurance widely and in particular to the rural areas, meet the various life insurance needs of the community that would arise in the changing social and economic environment.

The life insurance business was nationalised on 19th January, 1956 and the Life Insurance Corporation of India came into being on 1st September, 1956 to carry on life business in India with capital of Rs.5 crores contributed by the Central Government. The Corporation is a body corporate having perpetual succession with a common seal with powers to acquire, hold and dispose of property and may by its name sue and be sued. The functions of the Corporation shall be to carry on and develop life insurance business to the best advantage of the community. The Corporation shall have power (a) to carry on capital redemption business, annuity certain business or reinsurance business in so far as such reinsurance business relating to life insurance business; (b) to invest the funds of the Corporation in such manner as the Corporation may think fit and to take all such steps as may be necessary or expedient for the protection or realisation of any investment; including the taking over of and administering any property offered as security for the investment until a suitable opportunity arises for its disposal; (c) to acquire, hold and dispose of any property for the purpose of its business; (d) to transfer the whole or any part of the life insurance business carried on outside India to any other person or persons, if in the interest of the Corporation it is expedient so to do; (e) to advance or lend money upon the security of any movable or immovable property or otherwise; (f) to borrow or raise any money in such manner and upon such security as the Corporation may think fit;

(g) to carry on either by itself or through any subsidiary any other business in any case where such other business was being carried on by a subsidiary of an insurer whose controlled business has been transferred to and vested in the Corporation by this act; (h) to carry on any other business which may seem to the Corporation to be capable of being conveniently carried on in connection with its business and calculated directly or indirectly to render profitable the business of the Corporation; and (i) to do all such things as may be incidental or conducive to the proper exercise of any of the powers of the Corporation. (j) In the discharge of any of its functions the Corporation shall act so far as may be on business principles.

Objective
Need for the Life Insurance:
The original basic intention of life insurance is to provide for one family and perhaps others in the event of death. Originally, polices were to provide for short periods of time, covering temporary risk situations, such as sea voyages. As life insurance became more established. It was realized what a useful tool it was in a number of situations, including: y Temporary needs threats: The original purpose of Life Insurance remains an important element, namely providing for replacement of income on death etc. y Regular saving: Providing ones family and oneself, as a medium to long term exercise (through a series of regular payment of premiums). This has been become more relevant in recent times as people seek financial independence from their family. y Investment: Put simply, the building up of saving while safeguarding it from ravages of inflation. Unlike regular saving products are traditionally lump is investments, where the individual makes are one time payment. y Retirement: Provision for ones on later years has become increasingly necessary. Especially in charging culture abs social environment, one can buy a suitable insurance policy which will provide periodical payments on ones old age.