PROJECT ON THE STUDY ON KEYMAN INSURANCE PROJECT REPORT SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENT FOR THE AWARD

OF THE DEGREE OF BACHELOR OF COMMERCE (BANKING AND INSURANCE) MUMBAI UNIVERSITY 2012 2013

SUBMITTED BY Ms. IYER RAKSHA VENKATRAMAN (10721) Parle Tilak Vidyalaya Associations MULUND COLLEGE OF COMMERCE Sarojini Naidu Road, Mulund (west), Mumbai 400 080

DECLARATION

I, Raksha Iyer Venkatraman, student of Mulund College of Commerce, Bachelor of Commerce (Banking and Insurance) (semester VI) hereby declare that I have completed this project on The Study on Keyman Insurance in the Academic Year 2012-2013. The information submitted in this report is true and to the best of my knowledge.

Iyer Raksha V (Student)(10721)

ACKNOWLEDGEMENT

First and Foremost I thank the ALMIGHTY for the inspiration and strength to complete this project report successfully. I would also like to thank our Principal Dr. (Mrs.) Parvati Venkatesh who has always supported me throughout the project. I express my sincere gratitude to my teaching faculty, for their continuous support in bringing the topic into reality and making the project success and a good learning experience. On a personal note, I wish to thank my family members and friends for their constant support in helping me accomplish my mission.

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EXECUTIVE SUMMARY
Keyman Insurance is used when Company's need to ensure that they are protected from the risk of financial loss due to a reduction in their sales, distribution and operational capability or the consequences of an early unscheduled repayment of a loan. This risk of losing out financially or through reduced operational capability can be caused by losing their best, most important influential person key person due to death or serious illness. This key person can sometimes be at the heart of everything going on in the business, covering all departments with in depth expertise, driving sales through a network of contacts and could also be the guarantor on a loan that has been borrowed based on confidence in his/her competencies and capabilities. Unfortunately, when a company loses a person like this, its ability to survive and grow can be badly impacted. To remove this risk, it is possible to insure the key person and their key roles and a responsibility using what is called Keyman Insurance. Following an assessment of the financial risk that the loss would entail, a policy can be issued to the company covering the potential loss of the Keyman and all of the added value that s/he brings to business.

INDEX
Serial No. 1. 2. 3. Content Design of study Introduction to Insurance Introduction to Keyman Insurance 4. 5. Salient Features Who can be keyman insurance? 6. 7. Objective of keyman insurance
Companies and other firms eligible to take keyman insurance

Page No. 1 3 4

6 7

8.

Types of Keyman Insurance

10

9.

Advantages of Keyman Insurance

11

10. 11. 12.

Disadvantages of Keyman Insurance Requirements of Keyman Insurance Sum Assured Calculations

12 13 14

13. 14.

Procedures of Keyman Insurance Administrative requirements of Keyman Insurance

25 26

15. 15.1 15.2 15.3 15.4 15.5 15.6 16. 17. 18. 19. 20. 21.

KMI Policies Offered by Insurance Companies:Life Insurance Corporation SBI Life Birla Sun Life HDFC Life ICICI Prudential Max Life Case Studies Findings and its Interpretations Recommendations Conclusion Bibliography Annexure

27 33 34 35 37 38 39 42 46 47 49 50