INNOVATION IN INSURANCE

INNOVATION IN INSURANCE

Introduction:
The Indian insurance industry after the privatization of the insurance sector in 2000 has witnessed the entry of various private and foreign insurance companies .Due to privatization the competition in the insurance sector has became severe and in order to attract the customer and to retain them with the company the insurance companies has brought a huge number of innovation in the insurance industry.

The innovation was both in the product range as well as in distribution channel and marketing strategy. A number of new products are introduced by the insurance companies to attract the customers which are explained in detailed in this project further. The size of the Indian insurance market is very big as the crores and crores of people are uninsured and the penetration of the life insurance is also very low. With a view to increase the awareness and to provide knowledge to the potential customers the insurance companies have also innovated various distribution and marketing channels such as banc assurance , broker,agency,etc,which are also explained in the project.

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INSURANCE SECTOT REFORMS

In 1993, Malhotra committee, headed by former finance secretary and RBI gocverner, R.N Malhotra was formed to evaluate the Indian insurance industry and recommended its future direction. The committee was set up with an objective of completing the reforms in the Indian financial sector. The reforms was aimed at creating a more efficient and competitive financial system suitable for the requirements of the economy keeping in mind the structural changes currently underway and recognizing that insurance is an important part of the overall financial system where it was necessary to address the need for similar reforms. PURPOSE: a) To make recommendation for changing structure of insurance industry, for changing general policy frame work etc. b) To take specific suggestion regarding LIC and GIC with a view to improve functioning of LIC and GIC. c) To make recommendation on regulation and supervision of the insurance sector in India. d) To make recommendation on the role and functioning of surveyors, intermediaries, like agent etc. in the insurance sector. e) To make recommendation on any other matter which are relevant for the development of the insurance industry in India?

INNOVATION IN INSURANCE Recommendations: In1994, the committee submitted the report and give the following recommendations now in the point form: Structure: Government stake in the insurance companies to be brought down to 50%. All the insurance company should given greater freedom to operate.

Competition: Private company with a minimum paid up capital of Rs 1 billon should be allowed to enter in the industry. No company should deal in life and general in single entity. The insurance act should be changed. An insurance regulatory board should be operate.

Customer Service: LIC should pay interest on delays in payments beyond 30days. Insurance companies should be encouraged to set up unit linked plan. Computerization of operations and updating of technology to be carried out in the insurance industry. Overall the committee strongly felt that in order to improve the customer service and increase the coverage of the insurance industry should be opened up to competition. But at the same time, the committee felt the need to exercise caution as any failure on the part of new players could ruin the public confidence in the insurance industry.

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PRIVITIZATION OF INSURANCE SECTOR

Insurance Services Insurance investors developed economies, particularly from Western Europe and the US find Indian market as having greater growth potential than their domestic markets. Therefore, a high level of interest exists for these companies to acquire insurance concerns. Many international players are eyeing the vast potential of the Indian market and are already making plans to enter.

The entry of the foreign players in the sector with more financial resources/ better experience and lower operational costs will have an advantage over the Indian companies involved in the business. The bigger private players claim that opening up insurance will give policyholders better products and service, the opponents of

privatization argue that in a poor country like India insurance needs to have social objectives and newcomers will not have that commitment.

Better experience provides them with the wherewithal to have a better product mix and more operational flexibility. Moreover, they will operate with a lean staff and lower operational cost. The domestic

INNOVATION IN INSURANCE insurance industry will as a result, have to face a greater competition. But the resources with the foreign players are limited, as they can invest up to 40 per-cent of the equity of their joint-venture with Indian firms. This is a great hindrance for them to perform at their optimum level. IRDA is working out to gradually dismantle the tariff structure.

Not much threat is perceived as to any price war since the new companies will stress more on the non-actuarial product

differentiation. However, the Indian Insurers due to their extensive branch networking and long-standing association with the client still have an advantage.

Further,

insurance products

can become competing investment

product vis--vis other saving, etc. Already LIC has launched Equity linked Indexed Insurance Policies, which have been received quite well. The new players are expected to bring in spate of such products.

Insurance is viewed as a tax saving instrument rather than protecting one's own kith and kin from the vagaries of the future. The rush for insurance policies to save tax bills can be seen at the end of the financial year. With the entry of private and global players like HDFC Standard Life, JCTCI Prudential, Kotak Mahindra Club Insurance, Hindustan Times Commercial Union to name a few, the insurance 5

INNOVATION IN INSURANCE industry is going to provide many jobs and is going to witness phenomenal growth.

LIBERALISATION OF INSURANCE MARKETS

Meaning: A liberal insurance market is one in which the market, subject only to economically justifiable government restrictions, determines; who should be allowed to sell insurance, what product should be sold, how product should be sold, and the prices at which the product should be sold.. In turn market access issues encompass prudential regulation. Second and fourth items commonly deal with issues such as product, price, and market conduct regulation. All four items subsume competition regulation. Pre-conditions for Liberalization: a) Sound competitive law. b) Efficient and reliable regulation. c) Phased-Liberalization. d) Efficient disclose and dissemination of information to the society. For developing countries, the regulation of insurance business in liberalization era poses following concerns and special interest. a) Restriction on entry, especially foreign players. b) Suppression of price and product competition; and. c) Control of inter-industry competition from those selling similar or complementary products. Insurance markets in countries like India inherently imperfection justifying the need for competition as well as regulation. This is attributable for the following reason: a) Lack of knowledge on part of insured.

INNOVATION IN INSURANCE b) Insurance is a complicated, technical subject. c) Intensity of price discrimination is high when there is competition.

What are Unit-Linked Insurance Plans?

Unit-linked insurance plans, ULIPs, are distinct from the more familiar with profits policies sold for decades by the Life Insurance Corporation. With profits policies are called so because investment gains (profits) are distributed to policyholders in the form of a bonus announced every year. ULIPs also serve the same function of providing insurance protection against death and provision of long-term savings, but they are structured differently. In with profits policies, the insurance company credits the premium to a common pool called the life fund, after setting aside funds for the risk premium on life insurance and management expenses. Every year, the insurer calculates how much has to be paid to settle death and maturity claims. The surplus in the life fund left after meeting these liabilities is credited to policyholders accounts in the form of a bonus. In a ULIP too, the insurer deducts charges towards life insurance (mortality charges), administration charges and fund management charges. The rest of the premium is used to invest in a fund that invests money in stocks or bonds. The policyholders share in the fund is represented by the number of units. The value of the unit is determined by the total value of all the investments made by the fund divided by the number of units. If the insurance company offers a range of funds, the insured can direct the company to invest in the fund of his choice. Insurers usually offer three choices an equity (growth) fund, balanced fund and a fund which

INNOVATION IN INSURANCE invests in bonds.

In both with profits policies as well as unit-linked policies, a large part of the first year premium goes towards paying the agents commissions Unit-linked insurance plans, ULIPs, are distinct from the more familiar with profits policies sold for decades by the Life Insurance Corporation. With profits policies are called so because investment gains (profits) are distributed to policyholders in the form of a bonus announced every year. ULIPs also serve the same function of providing insurance protection against death and provision of long-term savings, but they are structured differently. In with profits policies, the insurance company credits the premium to a common pool called the life fund, after setting aside funds for the risk premium on life insurance and management expenses. Every year, the insurer calculates how much has to be paid to settle death and maturity claims. The surplus in the life fund left after meeting these liabilities is credited to policyholders accounts in the form of a bonus. In a ULIP too, the insurer deducts charges towards life insurance (mortality charges), administration charges and fund management charges. The rest of the premium is used to invest in a fund that invests money in stocks or bonds. The policyholders share in the fund is represented by the number of units. The value of the unit is determined by the total value of all the investments made by the fund divided by the number of units. If the insurance company offers a range of funds, the insured can direct the company to invest in the fund of his

INNOVATION IN INSURANCE choice. Insurers usually offer three choices an equity (growth) fund, balanced fundand a fund which invests in bonds. In both with profits policies as well as unit-linked policies, a large part of the first year premium goes towards paying the agents commissions

Unique features

1. Unit linked plan to give you efficient earnings in the long term.

2. Three investment fund options: protector, builder and enhancer, with the freedom to switch between funds any time during the policy tenure.

3. Flexibility to make additional lump sum investments ( top ups ) to increase the savings portion of your policy

4. Minimum guaranteed returns of 3% pa. On your premium net of all policy fee and charges the entire upside on the performance of the fund is passed on to you

5. Option to make tax free withdrawal from your fund anytime after three years

6. Loan against your policy or surrender of the policy without penalty after a policy year

INNOVATION IN INSURANCE 7. Vary the face amour during the premium paying period depending on your life insurance requirements. 8. Convenient premium payment option singe pay, short pay or regular pay

Which is better, unit-linked or with profits?

The two strong arguments in favour of unit-linked plans are that the investor knows exactly what is happening to his money and two; it allows the investor to choose the assets into which he wants his funds invested.

A traditional with profits, on the other hand, is a black box and a policyholder has little knowledge of what is happening. An investor in a ULIP knows how much he is paying towards mortality, management and administration charges.

He also knows where the insurance company has invested the money. The investor gets exactly the same returns that the fund earns, but he also bears the investment risk

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Are ULIPs similar to mutual funds?

In structure, yes; in objective, no. Because of the high first-year charges, mutual funds are a better option if you have a five-year horizon.

But if you have a horizon of 10 years or more, then ULIPs have an edge. To explain this further a ULIP has high first-year charges towards acquisition (including agents commissions).

As a result, they find it difficult to outperform mutual funds in the first five years. But in the long-term, ULIP managers have several advantages over mutual fund managers.

Since policyholder premiums come at regular intervals, investments can be planned out more evenly.

Mutual fund managers cannot take a similar long-term view because they have bulk investors who can move money in and out of schemes at short notice. The transparency makes the product more competitive. So if you are willing to bear the investment risks in order to generate a higher return on your retirement funds, ULIPs are for you.

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INNOVATION IN INSURANCE Traditional with profits policies too invest in the market and generate the same returns prevailing in the market. But here the insurance company evens out returns to ensure that policyholders do not lose money in a bad year. In that sense they are safer.

ULIPs also offer flexibility. For instance, a policyholder can ask the insurance company to liquidate units in his account to meet the mortality charges if he is unable to pay any premium installment.

This eats into his savings, but ensures that the policy will continue to cover his life But in the long-term, ULIP managers have several advantages over mutual fund managers.

Since policyholder premiums come at regular intervals, investments can be planned out more evenly.

Mutual fund managers cannot take a similar long-term view because they have bulk investors who can move money in and out of schemes at short notice.

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Advantages of ULIPS to insurers:

Insurers love ULIPs for several reasons. Most important of all, insurers can sell these policies with less capital of their own than what would be required if they sold traditional policies.

In traditional with profits policies, the insurance company bears the investment risk to the extent of the assured amount. In ULIPs, the policyholder bears most of the investment risk. Since ULIPs are devised to mobilize savings, they give insurance companies an opportunity to get a large chunk of the asset management business, which has been traditionally dominated by mutual funds.

Most insurers in the year 2004 have started offering at least a few unit-linked plans. Unitlinked life insurance products are those where the benefits are expressed in terms of number of units and unit price. They can be viewed as a combination of insurance and mutual funds. The number of units, which the customer would get, would depend on the unit price when he pays his premium. The daily unit price is based on the market value of the underlying assets (equities, bonds, government securities etc.) and computed from the net asset value.

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The advantage of Unit linked plans:

Unit Linked plans are simple, clear, and easy to understand. Being transparent the policyholder gets the entire upside on the performance of his fund. Besides all the advantages they offer to the customers, unit-linked plans also lead to an efficient utilization of capital. Unit-linked products are exempted from tax and they provide life insurance. Investors welcome these products as they provide capital appreciation even as the yields on government securities have fallen below 6 per cent, which has made the insurers slash payouts. According to the IRDA, a company offering unit linked plans must give the investor an option to choose among debt, balanced and equity funds. If you opt for a unit-linked endowment policy, you can choose to invest your premiums in debt, balanced or equity plans. If you choose a debt plan, the majority of your premiums will get invested in debt securities like gilts and bonds. If you choose equity, then a major portion of your premiums will be invested in the equity market. The plan you choose would depend on your risk profile and your investment need. The ideal time to buy a unit-linked plan is when one can expect long-term growth ahead. This is especially so if one also believes that current market values (stock valuations) are relatively low. So if you are opting for a plan that invests primarily in equity, the buzzing

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INNOVATION IN INSURANCE market could lead to windfall returns. However, should the buzz die down, investors could be left stung. If one invests in a unit-linked pension plan early on, say 25, one can afford to take the risk associated with equities, at least in the plan's initial stages. However, as one approaches retirement the quantum of returns should be subordinated to capital preservation. At this stage, investing in a plan that has an equity tilt may not be a good idea. Considering that unit-linked plans are relatively new launches, their short history does not permit an assessment of how they will perform in different phases of the stock market. Even if one views insurance as a long-term commitment, investments based on performance over such a short time span may not be appropriate. Ever since the insurance sector was opened up, private players have been trying to entice the Indian customer with new and innovative policies. But is the customer ready for innovations--such as unit-linked plans? These plans are popular in developed and other developing markets, but India has so far had only one such product from LIC. Stuart Purdy, managing director, Aviv a Life Insurance India, told Narayan Krishnamurthy and Udayan Ray that most of Avivas offerings here are unit-linked and he is betting on these products being successful.

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Can unit-linked plans actually fetch you market linked returns?

Unit-linked insurance plans are all of a sudden much talked about, publicized and sold. While these are not a recent phenomenon, since a number of insurance companies already had these products as a part of their portfolio, of late these plans have seen sudden frenzy.

It is perhaps the bull phase or the lure of market-linked returns that insurance companies have been shouting hoarse about that is responsible for these products outselling others. Given a thought? Do these products actually provide you market linked returns? Now before we get into the details, is that what you should be looking for from an insurance product? Isnt insurance in the real sense of the term meant for covering risk? And should you be aiming at financialReturns from an insurance product since that would mean compromising on the much more important security cover for yourself and your family?

If returns are your aim dont you think you should be opting for other investment avenues rather than risk your risk cover.While this is not to dissuade you from purchasing unit linked covers it would be in your interest to take a peek at the market linked returns you can expect. And if you think that the entire premium you pay is invested in avenues 16

INNOVATION IN INSURANCE chosen by you to maximize returns you could be wrong.

Expenses during the first year:

A substantial amount is deducted from your premium income by the insurance company towards various charges reducing the investible amount considerably. In the first year Allianz Bajaj through its Unit Gain SP Plus claims to allocate 100 percent of the single premium you Invest but cancels units on a monthly basis towards various charges from your fund.

Accordingly Kotak Safe Investment Plan allocates 86% and Life time of ICICI Prudential Life allocates 80 percent for amounts less than Rs 50,000 and 82 percent for those above Rs 50,000 towards investments. Administration expenses: The fund expense is the highest in the first year. ICICI Pru Life charges administration expenses of 20 percent of the premium for amounts below Rs 50,000 and 18 percent for amounts over Rs 50,000 in the first year while it is 7 percent for amounts upto Rs 20,000 in case of Kotak Safe Investment plan.

Again there are annual administrative charges that are as high as 1.25 percent per annum of net assets on Life Link of ICICI Pru Life and on Unit Gain SP Plus of Allianz Bajaj Life Insurance

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Will unit linked risk products continue to rule: Unit linked risk plans are doing roaring business agreed but if the recent reports are any indication a shake up is on the cards. The mutual fund industry is all set to get aggressive to counter competition from the insurance industrys unit linked risk products. For mutual funds the unit linked insurance products launched by life insurance companies are an encroachment on their territory. Consider this: Around 80 per cent of the premium income of life insurers has come in through unit-linked plans in 2004 thanks to the boom in the equity markets.

This means mutual fund companies are losing out on a huge market that would have otherwise been theirs. To put an end to such a situation they are toying with the idea of aggressively publicizing its products through celebrity endorsements which mutual funds feel will give a never-before fillip to its unit linked schemes.

Unit linked insurance products launched have been doing brisk business and insurers have been coming out with several such products with slight variations to suit the changing needs of the customers. These products are investment avenues that provide market related returns to the investor with an element of insurance thrown in. For the customer the attraction of market related returns with insurance is an attractive option. On

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INNOVATION IN INSURANCE the contrary though mutual fund companies also have unit-linked products what is absent is the insurance cover.

But the grouse of mutual funds is that they have to adhere to stringent regulations that are absent for insurance companies when the products are almost similar. While for insurance companies it is not mandatory to disclose the various expenses related to unit linked risk products such as expense ratio and brokerages among others, for mutual fund companies it is mandatory. The Association of Mutual Funds will soon be setting up a committee to work out an advertising strategy after which it plans to approach SEBI to take it from there. But will SEBI be able to take up the matter with the insurance regulator? Should I invest in unit-linked plans?

So have unit linked plans - the much talked about high-return offering product of late taken your fancy? Wondering what it is all about and how unit linked plans are able to offer a comparatively better return on your investment.

While they are not a totally new concept considering that the Indian investor is familiar with mutual funds that have been around for some time now, as far as insurance goes, unit linked has all of a sudden caught the fancy of the Indian customer.If you are all set to

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INNOVATION IN INSURANCE take the plunge into buying a unit linked product it would do well to know a few things about their working.

Combination of mutual fund and insurance cover: Unit-linked plans are a combination of an investment fund and an insurance policy. A major part of the premium amount received on such policies is invested in the stock market by the insurer in select funds depending on the risk level chosen by the customer. Mind you, this is after deducting administration charges and management expenses that may vary from one fund to the other. Choice of Funds: The customer has the option of choosing from debt, balance and equity funds. If the individual chooses a debt fund, a major part of his premia is invested in debt securities like gilts and bonds. But if it is equity, a major portion goes towards investments in the stock market. So depending on the risk profile the individual may choose his investment option.

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What do unit-linked products actually offer in terms of value-addition?

When you are looking at a long-term plan, there are always factors that will change from time to time to meet any challenges. Also, plans change so that the company can offer some amount of customization. Among other things, we offer to add the cover to the policy, add riders when necessary, and change the investment structure. We also let customers choose from different fund options on the investment without compromising on the basic product. While all these options do come with caps to follow the regulatory framework, they definitely offer value-addition to the customer. And, with the NAV (net asset value) of the fund calculated at the end of the day, the customer knows the value of his funds. I must add that that in case of death, the beneficiary gets the sum assured or the NAV of the fund, whichever is higher. So, there is no reduction in protection in these plans. Is the investment risk left to the customer who buys unit-linked plans? For any investor, the idea is to maximize returns. Wise customers know that the era of guaranteed returns is over. The fall in interest rates in the past 18 months is indication enough of what lies ahead. What unit-linked products offer is a long-term investment option where returns are far more real and there is no compromise in the protection that the policy offers.

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INNOVATION IN INSURANCE In the guaranteed returns regime, the guaranteed component was met by paying lower interest rates to those who did not have any guarantee on their plans. Compared to this, unit-linked plans offer greater value to the customer. Yes, to an extent the risk is in the hands of the customer. However, the flexibility to opt for funds means that the customer can benefit as well. And finally, the returns that these products offer are bound to be relatively higher than what similar traditional plans offer. In order to cater to customers with very low risk appetite we also offer a unitised, withprofit plan across our products, where the bonus rate is declared in advance for the year. This is a conservative approach but it has its takers. With this What has been the performance of unit-linked plans in other emerging markets? In a country like Poland, where the markets were opened a little over a decade ago, we are today the largest private insurance company. The demand for our unit-linked products is high. Worldwide, the growth of these products is high when compared to traditional products, an indication of where the market is headed. There are a few people who view unit-linked plans as pure investment products that offer little cover. But this is a myth and customers realize this when the benefit of these plans is explained to them. With investment options regulated, one has to be prudent with the money that is contributed for the product and has to add value for the business to be successful. I feel that both developed and developing markets understand the great value proposition that unit-linked insurance plans offer. Another factor that tilts the balance in favour of such

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INNOVATION IN INSURANCE products is the tax treatment that the accumulated account attracts. Its tax-free, unlike a mutual fund or any other investment, where the gains are taxed.

Riders
Riders are the additional benefits the company offers to the customer in addition to the life coverage. The customer has to pay additional premium to get this benefit. However the benefit of rider is optional, the client has full power to take or leave the riders.

There are five riders normally provided by the insurance companies and they are,5 ridersterms riders, AD&D rider, critical-illness, critical illness pus or critical illness woman rider. I can add or delete them (only after the 1st policy year) as my needs change

You can further customize your birla sun life insurance plan by adding riders to base plan at a marginal extra cost.

1) Accidental death and dismemberment benefit rider. It provides 100% of coverage in case of death due to accident; loss of more than one limb or sight in both the eyes or in case of loss of one limb and loss of sight in one eye 50% coverage in

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INNOVATION IN INSURANCE case of loss of one lib or sight in one eye.

2) Term rider: it provides additional amount of cover in the event of death of the life insured. 3) Critical illness rider: it provides a cover in the event of life insured being diagnosed as suffering from any of seventeen illnesses specified under the critical illness plus rider. 4) Critical illness woman rider: it provides a cover against several critical illness including woman specific illnesses, pregnancy complication and congenital anomalies in a newborn child. 5) Waiver of premium: this rider waives payment of future premiums on the happening of any of the unforeseen events as covered under this rider.

For rider deletion I am required to give a written intimation along with the policy documents. For rider addition, my certificate on insurability and the receipt of payment of rider premium will be needed (ride addition is subject to underwriting condition)

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Marketing strategies: -

Birla sun life has adopted various marketing strategies to market its product. The company has adapted to main strategies two main ways . 1. Corporate agent:

Marketing through corporate agents is the traditional ways of marketing the insurance products. Birla sun life also has huge number of agent spread all over the country.

2.

Banc assurance: Banc assurance is also a modern method of marketing insurance product in the

market. It is done in three ways. In banc assurance is a coming together of a bank and insurance company to market the insurance product. The banks provide its customer data or sell the insurance product to its customer. 1) Joint venture 2) Corporate agent

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INNOVATION IN INSURANCE 3) Customer base

Effective Banc assurance model

There are broadly three banc assurance models in operation globally

Distribution alliance Joint venture between bank and insurer Merger between banks and insurer In joint venture bank and insurance company form a separate insurance company as in the case on ICICI prudential life insurance?

in corporate agent module a bank act as an agent of the insurance company and sell products to its customers . The bank gets commission for its service as in the case of LIC and Corporation bank in customer base the bank allow to sue its customer data and its premises to insurance company to sell its products.

Birla sun life insurance Company has tied up with three bank to market its products .they act as a corporate agent of the bank.

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1) CITI BANK 2) IDBI BANK 3) KARUR VYSYA BANK

Among these three banks citi bank is the most active agent of the company .the company also give various benefit to the customer of the citi bank. For e.g.:- if a normal customer is above the age of 45 or the policy amount exceed the amount of rs15lacs then he is required to submit FMR(FULL MEDICAL REPORT) .but for the customer of city bank the limit is exceeded to rupees 20lacs .

Recently the company has decided to target the SME sector i.e. small-scale enterprise To market this product. They have innovated new product. Basically for this the company has decided to use industrial marketing strategies. The product innovated are explained below

Mot of the partnership in India fall in to the first model, were banks have offered their services as distribution channels for insurance products through their branch network. In terms of present regulatory frame work banks have taken up corporate agency for marketing insurance products for an agreed referral fee/commission.

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INNOVATION IN INSURANCE Banc assurance in India is very much in its infancy. There are a wide variety of banks, which are very different; both in make up, culture, geographic spread and working practices. There are wide number of approaches and models that can be adopted for banc assurance, many of which are dependent on this attributes, as well as the insurance partner views and competencies, and also the nature of relationship between the bank and insurer-whether one of equity sharing company structure, or of a profit share nature or purely a distribution management.

The effective banc assurance model is the one, which helps, in pushing sales as well as satisfying customer needs and helping banks to become a One stop shop. As a Banc assurance model, if the bank is using distribution agreement model, it should, go in for an exclusive agreement with an insurance company of repute. The reason being, while signing up with multiple insurers you end up looking like a broker who is not committed to brand or a product or a particular level of service, which is so vital for the growth of Banc assurance. By signing an exclusive agreement with the insurer, the bank can put the stamp of its own Brand on the product without actually taking any risk. The bank will thus be identified with the product it is selling and will be able to convince the customer in a much better way. However, if the insurance market is not mature and there is lack of creativity and innovation, even non-exclusive agreement is workable.

Sale of insurance products by the banks offers the following benefits:

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It adds to the portfolio of retail products already offered by the banks.

It helps in building and packaging the existing core banking products like adding deposit life insurance on a pure term deposit product.

Balances the less performing products.

It is a risk management device, since the fee increase earned on the sale of insurance can be used to offset the loss on account of bad loans.

It helps in increasing customer loyalty since they have more reason than just the banking to continue their relationship with the bank.

It helps bank to become a one stop shop for all the financial needs of the customers while it is banking insurance investments or state planning.

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THE WORKING OF BANCASSURANCE

The distribution channel today for insurance products is widening. Increase in distribution channels among others has also seen the concept of Banc assurance taking roots in India, which is emerging to be a viable solution to mass selling of insurance products. A popular concept in the West, Banc assurance put in simple terms means selling insurance products through banks.

Wide network of branches

The Insurance Regulatory Development Authority (IRDA) has permitted banks to venture into marketing insurance products on a risk participation basis. Banks need to possess at least 500 crores of net worth and capital adequacy of a minimum of 10 per cent to make an entry. Since banks have wide number of branches, distribution will be smoother.

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Corporate clients

Banks can utilize their existing clientele, which includes corporate as well as retail clients to market insurance products. Depending on the relationship with its clients it would become easier to influence tile insurance purchase decisions of its clients. Customers too, having banked with a particular bank for a long period repose a sense of trust and faith in the bank.

Customer database

Customer database - raw information on the customers spending habits, investment purchase, can prove to be a goldmine. Such information channelised in the right manner can help work out marketing strategies and arrive at result-oriented decisions targeting prospects.

Personalized Service

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INNOVATION IN INSURANCE Since banks have direct contacts with customers, the service area can be tackled easily. Customers, other than their day-to-day financial requirements can also get assistance for premium payment, surrender, transfer of policies and many more.

Rural penetration

Penetration into the rural areas is easier for banks. Having been accustomed to the customers' choices, banks are in a better position to understand the needs of the customers and sell tailor made policies.

Cross-selling products

Banks in their normal course of functions lend finance in the form of loans for cars or for buying a house. They can combine insurance products and sell as a package. In the current scenario banks can cross sell their products along with the insurance products.

Fee based service

Insurance products can be sold as a fee based service. in which some broker charge commission to policyholder against the insurance product , such as, selling of insurance policy, different types of scheme ( ULIPS, endowment, personal accident, whole life, money back policy and joint life policy ) etc.

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INNOVATION IN INSURANCE Joint life policy is much suitable for fee based services to the insurance agents in the insurance sectors. And now, in ULIPS are most benefited to insured persons as well as insurers agents.

Cheaper than agents

Banc assurance may work out to be cheaper compared to companies appointing agents for selling insurance products. This is particularly considering the banks wide network and the reach they have compared to the agents.

"Integration of Banks and Insurance Companies is Likely to have a Longer Impact"

Insurance companies have been very slow to use the Web, for example, and their web pages are among the poorest designed in the financial services industry in the US. France, Canada has picked up banc assurance very fast whereas US, Japan has not. They've lagged behind in the US for a number of reasons. Consumers don't see banks as a primary source for insurance.

Consumers do not have a lot of confidence in banks' financial expertise outside of loans and deposits. There are well-developed distribution channels for insurance that are effective. Banks thought they could get "easy sales" by cross-selling insurance, forgetting that:

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They are not good cross-sellers,

The level of training required to sell insurance and the licensing requirements are far heavier than what they're used to for selling other products, and

The banks have not, in most cases, put a strong emphasis on insurance Annuities, somewhat, more than other products.

sales.

The time taken to over come the sluggishness can also because of the reason that functioning of banks and insurance companies are different from each other.

On the other hand, this integration of banks and insurance companies is likely to have a longer impact. Over time, they will integrate increasingly as public perceptions change and banks put more effort behind it. The insurance companies are trying the idea of selling banking services. Some banks and insurance companies fear that this will lead to higher growth and revenues but for those companies, which have not opted for banc assurance, it will be an end.

I think it will be easier for the insurance companies to offer banking services than it will be for the banks to offer insurance products. The insurance companies are more under threat from industry consolidation and cost pressures within their own industries than they are from bank/insurance company combinations at this point. The dream was that

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INNOVATION IN INSURANCE the banks' customer-bases would be "ripe for picking", but the banks' sales and marketing teams have not figured out how to make it work.

"For Banc assurance to be successful, the savings made on the distribution may have to be passed on to the customer. Insurance companies need to design products specifically for distributing through banks."

On usefulness of Banc assurance : Globally there is a trend of convergence of all , personal finance services including insurance. In this scenario, it is possible for banks to distribute some of the insurance products to their customers. It is possible for banks to cross-sell insurance to their customers. Thus, the existing distribution network and the existing customer-base of the banks are utilized for selling insurance. There will be savings in distribution cost as well as customer acquisition cost. These savings will be passed on to insurance seekers.

On new pricing issues: Marketing especially the pricing may be the key ,

issue. For

banc assurance to be successful, the savings made on the distribution may have to be passed on to the customer. Insurance companies need to design products specifically for distributing through banks. Trying to sell traditional insurance products may not work.

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INNOVATION IN INSURANCE On the success factors: concept will succeed, as the customer is ultimately the The same. However, it may not work for traditional insurance products. It is right that the functioning of banks and insurers is different. New products need to be designed keeping in mind the functioning of banks and the needs of bank customers.

On the measures of strategies be taken up by companies: to Companies not opted for Banc assurance could consider approaching or identifying the customers through other channels. For example, a customer approaching a bank for home loan can be offered Householder insurance policy through Banc assurance. However, other insurers through a real estate developer or a real estate broker can offer the same customer a Householder insurance policy.

On level of success in India: India, the level of success could be high. Many banks In have entered the insurance sector through joint ventures and others have formed alliances with Banks. These new companies will try to exploit the branch networks of the banks. For example, Standard Chartered bank has already started selling personal accident covers of Royal Sundaram Alliance Insurance Company to its credit card holders.

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INNOVATION IN INSURANCE On the competition between LIC and SBI : too early to comment. The strength of It is LIC is their agent network. LIC is said to have over eight lakh agents. The strength of SBI is their branch network. Traditionally, life insurance is best sold through agents, while bank branches only supplement.

Other marketing and distribution channels

Internet Though India is joining the fast growing breed of net users, using net for transactions has not yet caught up. Though a few banks provide online banking, the usage is still a small fragment. The insecurity associated with transactions over the net is still an inhibiting factor. At present most of the insurance companies have product information and/or illustrative tools on the web. We do not see the web evolving into a means for direct selling of insurance in the current scenario. In the Indian market, where

insurance is sold after considerable persuasion even after face-to-face selling, the selling over the net, which must be initiated by the client, would take some more time. While the technology capability is there, improvements in bandwidth and infrastructure are needed. Also needed are simpler products where auto-underwriting is feasible. Automobile insurance, one of the segments of insurance purchased "off the shelf" in India, would be the ideal segment to start with. On the life side, term

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INNOVATION IN INSURANCE assurance possibility. These channels by themselves will not be able to overcome the mindset of the people, but rather can only be enablers for the human channels. for standard lives with simplified underwriting is a

Electronic Channels:
In the last decade, numbers of technological advances have taken place due to immense use of EDI (Electronic Data Interchange)

CHANNEL Electronic channels

LIC on internet Information Kiosks SMS

LIC on Internet:

They have their own site, which is very informative. They display information about them and its subsidiaries, the product they offer. The addresses/e-mail Ids of their zonal offices, zonal training centers, management development centers, overseas branches, Divisional offices and also all Branch offices with a view to speed up the communication process. 38

INNOVATION IN INSURANCE SMS:

SMS through mobile phone is recently new technology introduced by the LIC to promote their product.

Advertising:

It is a paid form of non-personal communication. It is used to create awareness and transmit information in order to gain a response from the target market. Forms of advertising are as follows: o News Papers and Magazines: LIC give ads in the news papers and magazines round the year to continue its brand image and also when new products are introduced. Normally its ads are published in Times of India. o Electronic media: Insurance companies also advertise its services in the Electronic media like: Internet (Websites): Companies like LIC (www.licindia.com), ICICI

(www.iciciprudential.com) all have websites from which people can get the information about their products, prices, various schemes, and lots of other information. People can also purchase the product through this website.

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INNOVATION IN INSURANCE

Television: Companies like LIC, Met Life India, advertise on television to

make people aware of their products and services. Radio: ICICI Prudential advertises on 92.5 red Fm. Punch lines and logos: It helps to create awareness about the brand among the target audience. It also helps the company to convey its message to the customer.

Brand LIC Oriental Insurance Max New York ICICI Lombard Birla Sunlife ING Vyasya ICICI Prudential Aviva Royal Sundaram Bajaj Allianz HDFC life ins

Positioning: Tag Line Zindagi ke saath bhi, zindagi ke baad bhi Prithvi, Agni, Jal, Aakash, Sabki suraksha hamare paas Your partner for life Business Uninterrupted Your dreams, our commitment Adding life to insurance We cover you at every step in life. Kal par control Beyond Expectations Haske Jeeyo Yaar Sar utha ke jiyo

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INNOVATION IN INSURANCE

Disability Insurance.
Most of us insure our lives, effectively insuring that we will be able to provide income for our families in event of our untimely death since we believe that we are doing something reasonable to prevent any undue financial burden from affecting the lives of our loved ones. Yet, most of us never insure a part of us that is much more important. Not only can a disabled person not work but he or she has to undergo extensive medical regimes while still incurring the daily costs of living. And health insurance is not enough to circumvent the perils associated with permanent disability. A recent study conducted abroad found that although 96 percent of seriously ill people had medical insurance over a third of them lost everything that they owned and maintained owing to their disability. After all, a disabled person still needs to eat and drink like the rest of normal human society. Given the fact that he or she is disabled now requires extra care from the family or paid professional help that eventually uses up the funds much beyond what they might have earned. People may be put off by the price of disability insurance but the only reason why the policy premiums are higher is because there is a much greater chance of you actually needing the policy

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INNOVATION IN INSURANCE Most of the Indian insurance policies have an in-built disability clause. So the next time any agent tries to sell you a life insurance policy, do inquire more about the disability clauses. Also, check out the definition of disabled in the policy that the agent offers since you must be insured for your chosen occupation. At times, a disability may stop you from working at your current job but still lets you perform other activities. Do verify if there is coverage offered for partial disability since it could be the moot point between overtaxing yourself and worsening your condition and being able to achieve the needful by performing whatever amount of work seems prudent.

Also, look for a policy that holds a guarantee and is non-cancelable. Guaranteed policies are policies where the payment stays fixed. Non-cancelable policies stay in effect regardless of whatever that might happen and as long as the premium is paid from time to time.

Finally, the last option to map is to calculate how much actual cover you may be having currently or might need in the times to come. An insurance cover of Rs.1 lakh may have been adequate when you started working and earned Rs.3000 per month. But it sure will be insufficient now that you have risen up in the world and your salary has risen to over Rs.20000/- month.

Keep your interests in mind while choosing the insurance policy and you will never regret it. After all, in the materialistically inclined times where we subsist, selfcentredness is the only truly justifiable prerogative in life

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INNOVATION IN INSURANCE

Please go through this list. It is designed as the starting point to help you make the right choice while purchasing a life insurance policy. Answer the questions with your policy in perspective and eliminate any conflicting doubts that might arise.

Is your life insurance so arranged that the proceeds stand exempted from the claims of creditors, in case you have any? Will it stand against any judgment passed by a court of law?

If and when desired, will the cash values of the insurance policy result in the largest possible income for yourself?

In case, you have named your children as beneficiaries, do all of them participate? In case your children are minors, can your expenses be correctly and swiftly liquidated?

In case of an unexpected emergency, will the settlement provision prove sufficiently flexible? Or will your benefactors interests be jeopardised?

Are all beneficiary designations correct and complete? Do your beneficiaries need to be altered due to new family circumstances?

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INNOVATION IN INSURANCE

Is there a chance of your current life insurance policy being subject to probationary delays or unnecessary additional expenses?

Do your grandchildren, if any obtain equal shares in your estate? Are the beneficiary clauses formulated in a way that they perform your last wishes to their fullest, with no violation whatsoever?

Will your spouse be guaranteed the most favourable income from the insurance proceeds?

Is the extent to which your life insurance policy providing income absolutely clear in your mind?

Can your spouse outlive the income provided? Is your insurance policy arranged in a manner to create an income for your childs educational and marriage expenditure?

Shouldnt you provide a cash fund for your spouses last expenses? Have you taken full advantage of the best possible exemptions from tax? Is the insurance policy so arranged that your spouse will be provided with similar income advantages as yourself, if he or she outlives you?

Is there a chance of saving more if you opt to change the frequency of the payment of premium?

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INNOVATION IN INSURANCE

Is there a non-forfeiture option provided? Would a change in the non-forfeiture option be beneficial?

Would the proceeds of your life insurance policy be subject to double taxation if you predecease your spouse?

Is the plan of distribution of your life insurance coordinated with your general property?

Do you now own a substandard policy? If so, do the conditions that caused the extra rating still exist?

Are there any "gaps" left in your "earning years"? For instance, your agent might go on selling you short-term policies, all of them maturing between 50-55 years of age. Eventually you will be resigned to a zero-insurance status when you actually need it the most

There are no hard and fast rules, nor any easy formulae to help you decide how much life insurance cover you need. However, there is a fairly straight forward approach which each of us can follow. Since life insurance is, first and foremost, financial security for your family, you can judge how much money your family will need increase of your premature death and build your insurance portfolio accordingly. 45

INNOVATION IN INSURANCE For instance, if you are contributing Rs.3,000 a month for meeting your familys needs, you must have a life insurance cover of around Rs.3 lakhs. In case of the policy holders death the family can invest this amount in some absolutely safe investment avenue such as government bonds, which pay 12% interest. The annual interest of Rs.36,000. Additionally, the insurance portfolio could also include polices specifically earmarked for the education and marriage of your children. Income replacement is another approach to determine how much insurance one needs. There are ways to figure it; two are discussed below: 1. Seventy-five percent solutions: Some observers believe that a family, particularly a young one, needs about 75 percent of the take-home pay the insured would have received until age sixty-five. 2. Five times solution: A second income replacement formula is to buy insurance equal to five times your annual income less any insurance equal to five times your annual income less any insurance already held. Suppose your annual income is Rs.25, 000. Multiply this by 6 and it equals Rs.1,50,000. Now if you have Rs.25,000 in-group life insurance, you need an additional Rs.1,25,000 (Rs.1,50,000 minus Rs.25,000) of life insurance.

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INNOVATION IN INSURANCE

Business insurance:Business insurance is a type of insurance which is taken out by the business concerns. Every business house, small or large requires security for their business. For the security and safety of their employee & employers, they require certain type of insurance which will help them to preserve from the uncertainties arising in the business. A business concerns include company, partnership or sole trading concern. Every business concern take out insurance for there employee, key person etc.This help them to protect the interest of their employees.

Business Insurance comprises of: Key Person/man Insurance Partnership Insurance Employer- Employee Insurance

What is Key Person Insurance?

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INNOVATION IN INSURANCE Key man insurance is a insurance taken out by the business concern to indemnify himself from the loss which the may suffer in the event of death or loss of skill of the key person, it can also be defined as Insurance taken by a Business Concern on the lives of the Key Employees / Directors / Working Partners. Their Talent and Experience account for much for the success of the Business Who cannot be easily replaced by virtue of their long experience.

A Key Person is: Key Executive Key Employee Whole Time Director Working Partner Business Concern includes:

A business concern includes: Company To insure key employees / directors Partnership firm To insure working partners/ Employees

Sole proprietor concern To insure key employees, but not the sole proprietor

The risk arising from the death of key employee is as follows: Reduction in value of business Decrease in sales and production Impaired customer and supplier confidence Weakened credit standing of business Forced liquidation of business

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INNOVATION IN INSURANCE Delay or termination of projects or future plans Reduced Brand Value Reduction of profits Replace loss of profits

Provide funds to recruit, hire, and train suitable replacement Assure customers, creditors and employees of the continuity of the business Pay a death benefit to the Key Persons family Reduction in profits Hostile Takeovers

The benefits of key men insurance to particular business concern are as follows: Replace loss of profits Provide funds to recruit, hire, and train suitable replacement Assure customers, creditors and employees of the continuity of the business Pay a death benefit to the Key Persons family Ensure Liquidity Create policy cash value which accumulates and can be used for emergency business requirement or opportunity Key Employee retirement / disability income

As explained earlier that the key man insurance is taken out by the business concern to indemnify himself from the loss arise due to death of the key employee of the company, the benefit of the key men insurance is enjoyed by the company himself.

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INNOVATION IN INSURANCE Key person insurance is taken by a business concern for its own benefit and not for the benefit of its employee / individual. The control of the key men insurance is also with the company as the following right are with the company himself. Premium is paid By the Business Concern It retains the right to the Policy Is eligible to receive the policys benefits On what basis can key person insurance be given? Holdings Contribution To Profits & Profile Documents Holdings

In case of an entity, the key person should not hold; more than 50% individually, and more than 75% jointly with his family (Family includes spouse and minor children when a minor becomes a major, then he/ she is not a part of the family for this purpose)

The above are more of a convention and not a rule or law. Contribution to the Profits & Profile Quantum of Insurance will depend on the key persons contribution to the concerns profits keeping in mind

His Qualifications Experience No. of key persons in the concern 50

INNOVATION IN INSURANCE Documents - Profits & Compensation The cover for all the key persons in the concern will be limited to the least of ; 3 Times of Average PBDT ( Profit before Depreciation and Taxes) for the last 3 years 5 Times of Average Profit before Taxes ( PBT) - for the last 3 years Individual Key persons cover limit Up to 8 times of the annual compensation of key person.

Assume that the Key mans annual compensation is Rs. 12 Lakhs and commission @ 1% of the PAT.

3 Times of Average PBDT for the last 3 years = 280 + 250 + 200 X 3 = 730 3

5 Times of Average Profit before Taxes = 220 + 190 + 140 X 5 = 917 for the last 3 years 3

8 times of the annual compensation = 12 + (1% of 139.5) X 8 = 107 of key person The cover for all the key persons in the concern will be limited to 730 lakhs&individual Key persons cover limit will be 107 lakhs.

Where do you get the information on PBT & PBDT ?

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INNOVATION IN INSURANCE

Balance Sheet& P & L Statement: forming a part of the Companys Annual Report Balance Sheet: Presents the snapshot of the companys financial Position and reflects the sources and application of funds. Documents Required : Copy of Memorandum and Articles of Association Copy of Resolution of Board authorizing such insurance Copy of audited accounts for the last 3 years Key person Questionnaire I. T. returns of the Key person for the last 3 years

Plans & Policy Procedures:

Flexi Save Plus, Flexi Life Line, Classic Life and Term Plan can be given Term and CI riders can be added Concern being the owner of the policy, nomination is not possible. Assignment can be made in favour of the key person, in case of the key person leaving, can also be assigned in favour of

new employer

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INNOVATION IN INSURANCE Tax Treatment Business concern, being the owner, can claim the premium paid as Business expenditure under Sec 37 of the I. T. Act. Circular No 762 dated 18th Feb 1998. (Eligibility for deduction would depend on facts of each case and the business concern will have to provide commercial justification to income tax authorities for availing of Premium paid by the concern not a perquisite in the hands of the key person. Policy proceeds received will not be exempt under Sec. 10(10D)s of the I.T. Act. Policy proceeds received by the concern to be treated as business income and taxed under Sec. 28 of I. T. Act. key person insurance) In case of Assignment in favor of key person, S.V. to be treated as perquisite. If S.V. Is paid for by the key person, no immediate tax liability for the key person, but purchase price to be treated as business concerns revenue and taxed accordingly.

Tax Treatment Business concern, being the owner, can claim the premium paid as Business expenditure under Sec 37 of the I. T. Act. Circular No 762 dated 18th Feb 1998. (Eligibility for deduction would depend on facts of each case and the business concern will have to provide commercial justification to income tax authorities for availing of key person insurance)

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INNOVATION IN INSURANCE

1. Premium paid by the concern not a perquisite in the hands of the key person. 2. Policy proceeds received will not be exempt under Sec. 10(10D)s of the I.T. Act. 3. Policy proceeds received by the concern to be treated as business income and taxed under Sec. 28 of I. T. Act.

Benefits of Key person policy:

Concern is indemnified in case of sudden death of the key person. Corporate tax saving A tool for retention of key person Policy can be gifted to the key person as a recognition Policy can be used as a collateral security Withdrawals from the policy possible to meet any emergency

This is the various advantages which the company provide to its employee in turn of the services, given to them as a customer made by his employee. Key Man

insurance gives a chance of confidence to the company as well as to the employee, to work hard and acquire success in the business.

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INNOVATION IN INSURANCE

PARTNERSHIP INSURANCE

According to section 4 of Parternership is The relationship between the people who has agreed to share the profit of business carried on by all or any one of them acting for all.Partership Insurance is their, where two or more persons come together and get their sharing / business profit, which they acquire through trade, and invest in the insurance as policy performance for future predictability, safety and security purpose. In simple words it is a type of insurance taken by a partnership firm on the lives of partners.

What is the objective? 1. It allows predictability, safety and security to the partnership firm. 2. It is useful to protect their business from the various factor of risk.

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INNOVATION IN INSURANCE 3. It provides the central trust/mutual understanding from beginning process to ending process towards partnership firm.

4. To enable the partnership firm / remaining partners to buy the deceased partners share without disturbing the firms financial position.

Insurable Interest: A partnership firm has an insurable interest in the lives of its partners to the extent of purchase money ( capital and goodwill ) required to be paid in respect of share of each partner Qualifying Conditions:

1.

If partners are so related that one partner is the sole legal heir of the other partner, then partnership insurance cannot be considered

2.

All partners must be insured unless they are uninsurable on medical or age grounds

3. The partnership deed should contain a clause that the partnership is revocable definitely in the case of demise of a partner

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Documents Required:

Normal medical requirements for individual partners application

Copy of original and supplementary partnership deed

Consent letter to place an endorsement on the policy

Copy of I.T. returns for the last 3 years.

Copy of Audited accounts for the last 3 years.

Policy Procedures: Policy to be endorsed stating that in case of dissolution of firm for reason other than death of partner, the policy will either be surrendered or absolutely assigned in favor of the insured partner. The following are the points to be considered: 1. Firm being the owner of policy, nomination is not possible 2. Assignment, except in case of dissolution of firm not allowed

Tax Treatment:

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INNOVATION IN INSURANCE Insurance premium paid by the firm to be treated as business expense under Sec. 37 of Income Tax act Policy proceeds will be treated as income of the firm

Benefits of Partnership Insurance: Takes care of financial insecurity in the event of a partners death. Promotes a firms life Tax benefits to the firm Financial stability. Survival benefit. Mutual understanding.

EMPLOYER-EMPLOYEE SCHEME

What is Employer Employee Insurance Scheme? Insurance taken by an employer on the life of an employee for the benefit of the employee. Every company takes out insurance for his employee. The insurance taken out is in huge number and the insurance company sees the employer employee insurance as a big market for their business and has invented this product.

What is the objective? 1. To enable an enlightened employer to provide for insurance for the benefit of a loyal employee.

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INNOVATION IN INSURANCE 2. Employer has an insurable interest on the life of an employee

What are the options available? 1. Application is completed by the employee; - Application to be accompanied by a letter from the employer committing to pay the premium 2. Application is signed by the employers authorized person - Application to be accompanied by a letter from the employer stating the object of insurance, restrictions imposed regarding loan, surrender, etc., and that the policy would be immediately assigned in favour of the employee. Tax Treatment:

Premium paid by the employer to be treated as business employers books

expense in the

Premium paid by the employer to be treated as perquisite in hands of employee under Sec. 17 of I. T. Act.

the

Employee can claim I. T. rebate under Sec. 88 Policy proceeds exempt under Sec.10 (10D)

Benefits of Employer Employee Insurance:

Employer earns loyalty of employee /s Employee gets benefits of life insurance

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INNOVATION IN INSURANCE Tax benefits to employer and employee /s Motivation of the employee. Mutual understanding among the employees. Participative management.

Micro insurance:Micro insurance is one of the biggest and advance innovations in the insurance sector of India. As the majority of the population living in the rural areas and the majority of the population below poverty lines. The insurance company with a view to target this section of the society, has designed the product which the poor people will be capable to purchase.

In micro insurance the face value of the policy will be very low i.e. is Rs25000 and the premium will be payable on weekly basis instead of

monthly,quaterly,or yearly basis .the premium of the 25,000 on weekly will be Rs150 only which the poor people can afford. In this way the insurance will be able to cover this section of the section which consists of the biggest part of the market. The LIC has already introduce micro insurance in the market before 2 months

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Conclusion:In the end we reach to the conclusion that the insurance industry has witnessed a huge amount of innovation after the privatization of the insurance sector. the privatization has facilitated the entry of foreign and private players to the industry, due to which the competition in the insurance market has became very severe and in order to attract the customer and to retain the customer the insurance company has introduce various new product. Again the majority of the potential customers are unaware of the insurance companies and with a view to increase the aware the insurance companies has innovated the new marketing channels. Again the e need of the customer in the present world has increase a lot due to increasing uncertainty in the present world. And to meet their requirement of the insurance the companies are designing multi benefit products.

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CONTENT
Sr.No 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. PARTICULARS INTRODUCTION INSURANCE SECTOR REFORMS. PRIVATIZATION OF INSURANCE SECTOR. LIBERALISATION OF INSURANCE MARKETS. WHAT IS UNIT-LINKED INSURANCE PLAN? UNIQUE FEATURES. ARE ULIPS SIMILAR TO MUTUAL FUND? ADVANTAGES OF UNIT LINKED PLANS. RIDERS MARKETING STRATEGIES. BANCASSURANCE. THE WORKING OF BANCASSURANCE. DISABILITY INSURANCE. BUSINESS INSURANCE. KEY-PERSON/KEY-MAN INSURANCE. PARTNERSHIP INSURANCE. EMPLOYER-EMPLOYEES INSURANCE. CONCLUSION. Page. No

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INNOVATION IN INSURANCE 19. BIBLOGRAPHY.

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