Prof. Vipin Agarwal
What does insurance mean for people? The simple bookish definition is that making life secures from every kind of calamities and worst situation is called insurance. The real concept of insurance is much broader than that. In ancient time people used to sacrifice the lives of animals to make God happy so that God would protect them from calamities and in bad situations. This was also a type of insurance and the premium was scarification of animals. It is typical human psychology that they want to protect themselves from future crisis. In history we will find a thousand of stories where people(even king also)took help of foreseer to know about future and if something wrong, tried to make that right .With the development of civilization this psychology became more and more flatter and people instead of depending upon God and foreseer tried to protect their future themselves. In the same way, the concept and psychology of insurance got its definition. Now in these days, insurance company takes premium in the form of small amount and helps in the bad time of insured person and his family.
HISTORY OF INSURANCE SECTOR IN INDIA:-
IN India, the history of insurance sector began with the establishment of ORIENTAL LIFE INSURANCE COMPANY in Kolkata in 1818 by an Englishman. Later on in 1850 general insurance company was established. The insurance sector got its real shape of business industry in the earlier days of 19th century. In 1912, The Indian life assurance act was formed by British government to regulate Indian life insurance industry. In 1928, The Indian insurance companies act was made by Govt. to gather statistical data of life insurance and non life insurance sector. In 1938, important amendment was done in Indian insurance act, to protect the interests of customers i.e. insured people. In 1956, 245 Indian and foreign insurance companies were merged together by central govt. In this way a new company emerged, which was named “Life Insurance Corporation” BUSINESS AND SOCIAL OBJECTIVE OF LIFE INSURANCE CORPORATION
The business objective of LIC is complement with its social objectives. Its main objective was to spread life insurance to every corner of India & every citizen of India.LIC has been successful in achieving its objective so far. It also focus on rural areas especially to socially and economically backward classes and provide them life and health insurance cover at low price. Other objective is to encourage people for saving so that people will not face financial problem in future. For it LIC provide more insurance linked savings schemes which make it more secure and more attractive. People also like these products because they find it profitable in two ways •As an investment solution
•Insurance i.e. life cover
The funds created by LIC are used in the key investment areas of country like agriculture, health, education and other social welfares. The insurance business is conducted with the feeling that LIC is a trustful venture to insure public life. Even today after 50 years of its establishment its social objective doesn’t change much. Although there are few changes observed in recent time like expectations of customers and the business environment on which insurance sector does operate. This is because of globalization, which opened the door of insurance sector in India for private players.
Chairman- TS VIJAYAN
Paid up capital=100 cr
Since inception LIC has been the dominant player in Indian insurance sector and it has the majority of market shares. Now LIC is working with 2048 branch offices, 100 divisional offices and 8 zonal offices. So it has a huge presence all over the India. According to annual report 2008-09 of LIC it...