LIC AAO Digest
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www.BankExamsToday.com LIC AAO Digest insurance policy; if the insurance policy is voided, Chapter Page No. then the insurer may not have to pay out the claim. 1. Insurance 1-9 2. History(Ancient, 10-54 Some typical examples of insurance purchased by individuals include house insurance (which may Medieval, Modern) protect the insured against loss or damage to the 3. Geography www.BankExamsToday.com54-65 home due to fire or other hazards); car insurance 4. General Science 65-72 (which protects the driver against damage to her car, other vehicles she may have a collision with, 5. Current Affairs 72-78 liability for damages suffered by others in a collision, etc.) and life insurance. 1. Insurance List of insurance companies in India Insurance is a means of protection from financial Public Sector loss. It is a form of risk management primarily used to hedge against the risk of a contingent, uncertain 1. New India Assurance loss. An insurer, or insurance carrier (often called 2. National Insurance Company an "insurance company), is sells the insurance 3. The Oriental Insurance Company policy to customers. The customers, who are called 4. United India Insurance Company the insured or policyholder, are the person or 5. Agriculture Insurance Company of India entity (which may be a private company or other organization) buying the insurance policy. The Private Sector amount of money to the customer pays for a certain amount of insurance coverage is called the 1. Religare "premium". Risk management, the practice of 2. Bajaj Allianz General Insurance appraising and controlling risk, has evolved as a 3. Bharti AXA General Insurance 4. Cholamandalam MS General Insurance Co. Ltd. discrete field of study and practice. 5. Cigna TT 6. Future Generali The transaction involves the insured making a 7. HDFC ERGO General Insurance Company Ltd. payment to the insurer in exchange for the 8. ICICI Lombard insurer's promise to compensate (indemnity) the 9. IFFCO Tokio insured in the case of a financial (personal) loss. 10. L&T General Insurance The insured receives a contract, called the 11. Liberty Videocon General Insurance Co Ltd insurance policy, which details the conditions and 12. Magma HDI General Insurance Company circumstances under which the insured will be Limited financially compensated. In the event that the 13. Max Bupa insured experiences a financial or personal loss 14. Reliance General Insurance which is covered by the insurance policy, the 15. Royal Sundaram Alliance Insurance Co. Ltd 16. SBI General Insurance Company Limited insured makes an insurance claim to the insurer. 17. Shriram General Insurance Company Limited Insurance company claims adjusters and other 18. Star Health and Allied Insurance Company insurance company employees assess the claim. Limited Insurance policies typically set out certain 19. Tata AIG General circumstances or actions which will void the 20. Universal Sompo General Insurance Co. Ltd. www.BankExamsToday.com Page 1 www.BankExamsToday.com LIC AAO Digest Life Insurance Corporation of India General Assurance Swadeshi Life (later Bombay Life) Sahyadri Insurance (Merged into LIC, 1986) Life Insurance Corporation (India) (LIC) is an Indian state-owned insurance group and investment The first 150 years were marked mostly by company headquartered in Mumbai. It is the turbulent economic conditions. It witnessed, India's largest insurance companywww.BankExamsToday.com in India with an First War of Independence, adverse effects of the estimated asset value of ₹1560482 crore World War I and World War II on the economy of (US$230 billion) As of 2013 it had total life fund of India, and in between them the period of Rs.1433103.14 crore with total value of policies worldwide economic crises triggered by the Great sold of 367.82 lakh that year. depression. The first half of the 20th century also saw a heightened struggle for India's The Life Insurance Corporation of India was independence. The aggregate effect of these founded in 1956 when the Parliament of India events led to a high rate of and liquidation of life passed the Life Insurance of India Act that insurance companies in India. This had adversely nationalised the private insurance industry in India. affected the faith of the general public in the utility Over 245 insurance companies and provident of obtaining life cover. societies were merged to create the state owned Life Insurance Corporation. Nationalisation in 1955 History Founding organisations In 1955, parliamentarian Amol Barate raised the The Oriental Life Insurance Company, the first matter of insurance fraud by owners of private company in India offering life insurance coverage, insurance agencies. In the ensuing investigations, was established in Calcutta in 1818 by Anita one of India's wealthiest businessmen, Ramkrishna Bhavsar and others. Its primary target market was Dalmia, owner of the Times of India newspaper, the Europeans based in India, and it charged was sent to prison for two years. Indians heftier premiums. Surendranath Tagore (son of Satyendranath Tagore) had founded Eventually, the Parliament of India passed the Life Hindusthan Insurance Society, which later became Insurance of India Act on June 19, 1956 creating Life Insurance Corporation. the Life Insurance Corporation of India, which started operating in September of that year. It The Bombay Mutual Life Assurance Society, formed consolidated the life insurance business of 245 in 1870, was the first native insurance provider. private life insurers and other entities offering life Other insurance companies established in the pre- insurance services, this consisted of 154 life independence era included insurance companies, 16 foreign companies and 75 provident companies. The nationalisation of the life Postal Life Insurance (PLI) was introduced on 1 February 1884 insurance business in India was a result of the Bharat Insurance Company (1896) Industrial Policy Resolution of 1956, which had United India (1906) created a policy framework for extending state National Indian (1906) control over at least seventeen sectors of the National Insurance (1906) economy, including life insurance. Co-operative Assurance (1906) Hindustan Co-operatives (1907) Indian Mercantile www.BankExamsToday.com Page 2 www.BankExamsToday.com LIC AAO Digest Growth as a monopoly and 42 Banks for soliciting life insurance business From its creation, the Life Insurance Corporation of from the public. India, which commanded a monopoly of soliciting and selling life insurance in India, created huge Slogan surpluses, and by 2006 was contributing around 7% of India's GDP. LIC's slogan yogakshemam vahamyaha is in Sanskrit www.BankExamsToday.comlanguage which translates in English as "Your The Corporation, which started its business with welfare is our responsibility". This is derived from around 300 offices, 5.7 million policies and a ancient Hindu text, the Bhagavad Gita's 9th corpus of INR 45.9 crores (US$92 million as per the chapter, 22nd verse. The slogan can be seen in the 1959 exchange rate of roughly ₹5 for US$1), had logo, written in Devanagari script. grown to 25,000 servicing around 350 million policies and a corpus of over ₹800000 crore (US$120 billion) by the end of the 20th century. Insurance Regulatory and Development Liberalisation post 2000s In August 2000, the Indian Government embarked Authority on a program to liberalise the Insurance Sector and opened it up for the private sector. Ironically, LIC Insurance Regulatory and Development Authority emerged as a beneficiary from this process with of India (IRDAI) is an autonomous apex statutory robust performance, albeit on a base substantially body which regulates and develops the insurance higher than the private sector. industry in India. It was constituted by a Parliament of India act called Insurance Regulatory and In 2013 the First Year Premium compound annual Development Authority Act, 1999 and duly passed growth rate (CAGR) was 24.53% while Total Life by the Government of India Premium CAGR was 19.28% matching the growth of the life insurance industry and also The agency operates from its headquarters at outperforming general economic growth. Hyderabad, Telangana where it shifted from Delhi in 2001. Products and services IRDA batted for a hike in the foreign direct LIC offers a variety of insurance products to its investment (FDI) limit to 49 per cent in the customers such as insurance plans, pension plans, insurance sector from the erstwhile 26 per cent. unit-linked plans, special plans and group schemes. The FDI limit in insurance sector was raised to 49% Online Child insurance Plans in July 2014. Operations Today, the LIC has 8 zonal offices, around 113 Important Credit Rating Agencies divisional offices, 2,048 branches and 992 satellite offices and corporate offices; it also has 54 customer zones and 25 metro-area service hubs located in different cities and towns of India. It also has a network of 1,337,064 individual agents, 242 Leading Credit Rating Agency in India Corporate Agents, 89 Referral Agents, 98 Brokers – www.BankExamsToday.com Page 3 www.BankExamsToday.com LIC AAO Digest Indian credit rating industry mainly comprises of The RBI plays an important part in the CRISIL, ICRA, CARE, ONICRA, FITCH (India Ratings & Development Strategy of the Government of India. Research) & SMERA. It is a member bank of the Asian Clearing Union. The general superintendence and direction of the CRISIL - Credit Rating Information Services RBI is entrusted with the 21-member Central Board of