|
|
Table of Contents
Objectives Of LIC
Back to TopPeople's Money for People's WelfareWith the formation of the Life Insurance Corporation of India on 1st September, 1956, it can be said that utilization of people's money invested in Life Insurance for planned economic development of the country took roots. One of the objectives of nationalization of the life insurance industry was channelising of its funds for the benefit of the community at large. In pursuance of this objective, LIC has, over the years, been investing a major part of its funds primarily in the Socially Oriented Sector. As at 31st March, 1999, 84.49% of its total investments were in the Public Sector, 1.84% were in the Co-operative Sector and 13.67% were in the Private Sector. For the Welfare of the Society Keeping in mind the primary obligation of the Corporation to its policyholders, as enshrined in the objectives of nationalization, the funds of the Corporation are deployed to the best advantage of the policyholders as well as the community as a whole. While investing these monies which are held in trust, the Corporation has to keep in view the national priorities and obligation of reasonable returns. The Life Funds, so invested for the benefit of the community at large has accumulated to Rs.1,27,389 crore as at 31st March, 1999 after meeting the liabilities towards the claims, management and other expenses, registering an increase of Rs.21,556 crore during the year 1998-99. The investment of the Corporation's funds is governed by Section 27A of the Insurance Act, 1938, and subsequent guidelines/instructions issued thereunder by the Government of India from time to time. Not less than 75% of our accretions to the fund are invested in Central Government Securities, Government Guaranteed Marketable Securities, Loans in the Socially Oriented Sector for approved purposes such as Power (Electricity), Housing, Water Supply and Sewerage, Road Transport and Co-operative Industrial Estates. The total investment made by LIC in the Socially Oriented Sector including investment in Central/State Government Securities and Government Guaranteed Marketable Securities up to 31st March, 1999 amounted to Rs.98,003 crore. Better Health, More Power and Houses for Masses The Corporation has been promoting Social Welfare through Socially Oriented investments. These investments are regulated by the Government from time to time to benefit the people at large by providing basic amenities like potable water, drainage, housing, electrification and transport. Under the Corporation's scheme of providing financial assistance for piped water supply and drainage schemes, 1960 urban/local bodies in 23 States and the Union Territory of Chandigarh have benefited. In addition, 507 Zilla Parishads in 7 States are also receiving financial assistance from the Corporation for rural piped water supply schemes. The investment in this sector up to 31st March, 1999 was Rs.2,512 crore. The Corporation also provides financial assistance to State Electricity Boards/Power Corporations for power generation projects by way of loans/subscriptions to their bonds. The investment of the Corporation in the power sector was Rs.11,392 crore up to 31st March, 1999 thus reflecting the Corporation as the largest single contributing factor in the progress of electrification schemes in the country. Housing is one of the basic necessities of human beings. Housing Finance, therefore, occupies a prime place in Corporation's socio-purposive investments. Since inception, the Corporation has been providing finance for housing to individuals, Co-operative Housing Societies and private undertakings under its various mortgage housing schemes. With a view to solving the housing shortage in the country, the Corporation joined in a big way in the massive efforts by providing financial assistance to State Governments for Social Housing Schemes for Economically Weaker Sections, Low Income Groups, Middle Income Groups, State Government employees and rural population. The Corporation has also been extending financial assistance to State level Apex Co-operative Housing Finance Societies, the benefits of which are passed on to individuals through Primary Societies. Besides, the Corporation is providing bulk loans to Housing Finance Institutions like Housing Development Finance Corporation, Housing and Urban Development Corporation, National Housing Bank and State Policy Housing Corporations in a few States. In the year 1989, with a view to accelerating individual housing activities further, in consonance with national priorities, the Corporation decided to promote a new Housing Finance Company with a view to taking over the individual housing portfolios of the Corporation. Accordingly, LIC Housing Finance Company Ltd. Was formed initially with equity participation by LIC, UTI, ICICI and IFCI which has since become a Company with equity participation by public. The Corporation also extends financial assistance to LIFHFL for its on-lending operations. The total contribution of the Corporation up to 31st March, 1999 to housing development activities by way of loans to State Governments, State-Level Apex Societies, HDFC, HUDCO, NHB, LIFHFL, etc. and loans under Mortgage Housing Schemes amounted to Rs.12,242crore. The Corporation has been assisting development of road transport by providing financial assistance to State Road Transport Corporations for augmenting their fleet of buses. The total investment in this sector up to 31st March, 1999 was Rs.671 crore. In 1997-98, the scope of the socially oriented sector was widened to accommodate infrastructure projects pertaining to Ports, Railways (BOLT Projects), Roads, Highways and Airports. Further, it has also been classified that the Corporation can make Private Sector Investment in addition to Public Sector Investment subject to availability of suitable schemes which satisfy prudential norms. Boosting Industrial Growth Back to TopLife insurance made its debut in India well over 100 years ago. Its salient features are not as widely understood in our country as they ought to be. What follows is an attempt to acquaint readers with some of the concepts of life insurance, with special reference to LIC. It should, however, be clearly understood that the following narration is by no means an exhaustive description of the terms and conditions of a LIC policy or its benefits or privileges. For more details, please contact our Branch or Divisional Office. Any LIC Agent will be glad to help you choose the life insurance plan to meet your needs and render policy servicing. What is Life Insurance ? Life Insurance is a contract for payment of a sum of money to the person assured (or failing him/her, to the person entitled to receive the same) on the happening of the event insured against. Usually the contract provides for the payment of an amount on the date of maturity or at specified dates at periodic intervals or at unfortunate death, if it occurs earlier. Among other things, the contract also provides for the payment of premium periodically to the Corporation by the assured. Life insurance is universally acknowledged to be an institution which eliminates 'risk', substituting certainty for uncertainty and comes to the timely aid of the family in the unfortunate event of death of the breadwinner. By and large, life insurance is civilisation's partial solution to the problems caused by death. Life insurance, in short, is concerned with two hazards that stand across the life-path of every person: that of dying prematurely leaving a dependent family to fend for itself and that of living to old age without visible means of support. Why is it superior to other forms of Savings ?
Who can buy a Life Insurance Policy ? Any person who has attained majority and is eligible to enter into a valid contract can take out a life insurance policy for himself and on those in whom he has insurable interest. Policies can also be taken out, subject to certain conditions, on the life of one's spouse or children. While underwriting proposals, factors such as the state of health of the life to be assured, the proponent's income and other relevant factors are considered by the Corporation. Insurance on Women Prior to nationalization (1956), many of the private insurance companies used to offer insurance to female lives with some extra premium or on restrictive conditions. After nationalization of life insurance, the terms under which life insurance is granted to female lives have been reviewed from time to time. At present, women with earned income are treated on par with male lives. In other cases, a restrictive clause is imposed and that too only if age of the female is up to 30 years and if she does not have an income attracting Income Tax.
Life insurance is normally offered after a medical examination of the life to be assured. However, to facilitate greater spread of insurance and also as a measure of relaxation, LIC has been extending insurance cover without any medical examination, subject to certain conditions. With Profit and Without Profit Plans An insurance policy can be 'with' or 'without' profit. In the former, bonuses disclosed, if any, after periodical valuations are allotted to the policy and are payable alongwith the contracted amount. In 'without' profit plan the contracted amount is paid without any addition. The premium rate charged for a 'with' profit policy is therefore higher than for a 'without' profit policy. Keyman Insurance Keyman Insurance is taken by a business firm on the life of key employee(s) to project the firm against the finance loss which may occur due to the premature demise of the Keyman. Back to TopInformation Technology and LICLIC has been one of the pioneering organizations in India who introduced the leverage of Information Technology in servicing and in their business. Data pertaining to almost 10 crore policies is being held on computers in LIC. We have gone in for relevant and appropriate technology over the years. 1964 saw the introduction of computers in LIC. Unit Record Machines introduced in late 1950’s were phased out in 1980’s and replaced by Microprocessors based computers in Branch and Divisional Offices for Back Office Computerization. Standardization of Hardware and Software commenced in 1990’s. Standard Computer Packages were developed and implemented for Ordinary and Salary Savings Scheme (SSS) Policies. FRONT END OPERATIONS With a view to enhancing customer responsiveness and services , in July 1995, LIC started a drive of On Line Service to Policyholders and Agents through Computer. This on line service enabled policyholders to receive immediate policy status report , prompt acceptance of their premium and get Revival Quotation, Loan Quotation on demand. Incorporating change of address can be done on line. Quicker completion of proposals and dispatch of policy documents have become a reality. All our 2048 branches across the country have been covered under front-end operations. Thus all our 100 divisional offices have achieved the distinction of 100% branch computerisation. New payment related Modules pertaining to both ordinary & SSS policies have been added to the Front End Package catering to Loan, Claims and Development Officers’ Appraisal. All these modules help to reduce time-lag and ensure accuracy. METRO AREA NETWORK A Metropolitan Area Network, connecting 74 branches in Mumbai was commissioned in November, 1997, enabling policyholders in Mumbai to pay their Premium or get their Status Report, Surrender Value Quotation, Loan Quotation etc. from ANY Branch in the city. The System has been working successfully. More than 10,000 transactions are carried out over this Network on any given working day. Such Networks have been implemented in other cities also. WIDE AREA NETWORK All 7 Zonal Offices and all the MAN centres are connected through a Wide Area Network (WAN). This will enable a customer to view his policy data and pay premium from any branch of any MAN city. As at May 2002, we have 91 centers in India with more than 1320 branches networked under WAN. Click Here To Know More About LIC's WAN INTERACTIVE VOICE RESPONSE SYSTEMS (IVRS) IVRS has already been made functional in 59 centers all over the country. This would enable customers to ring up LIC and receive information (e.g. next premium due, Status, Loan Amount, Maturity payment due, Accumulated Bonus etc.) about their policies on the telephone. This information could also be faxed on demand to the customer. LIC ON THE INTERNET Our Internet site is an information. We have displayed information about LIC & its subsidiaries-LIC (International) E.C. ,LIC(Nepal)Ltd, LIC Mutual Fund, LIC Housing Finance and their products. Efforts are on to upgrade our web site to make it dynamic and interactive.The addresses/e-mail Ids of ur Zonal Offices, Zonal Training Centers, Management Development Center, Overseas Branches, Divisional Offices and also all Branch Offices with a view to speed up the communication process. PAYMENT OF PREMIUM AND POLICY STATUS ON INTERNET LIC has given its policyholders a unique facility to pay premiums through Internet absolutely free and also view their policy details on Internet premium payments.There are 11 service providers with whom L I C has signed the agreement to provide this service. Click here for more on Internet Premium Payment Click here for more on Online Policy Status INFORMATION KIOSKS We have set up 150 Interactive Touch screen based Multimedia KIOSKS in prime locations in metros and some major cities for dissemination information to general public on our products and services. These KIOSKS are enable to provide policy details and accept premium payments. INFO CENTRES We have also set up 8 call centres, manned by skilled employees to provide you with information about our Products, Policy Services, Branch addresses and other organizational information. For any information on Insurance
call up any of the numbers given below :
Back to TopLIC Claim's Settlement Operations
Back to TopHelp Us To Serve You BetterNeed for care while completing Proposal Papers A contract of insurance is a contract of utmost good faith technically known as uberrima fides. The principle of disclosing all material facts is embodied in this important concept which applies to all forms of insurance. The proposer, who is one of the parties to the insurance contract, has means of knowledge which are not accessible to the insurer, viz., the Corporation, which is the other party to the contract. Therefore, it is the duty of the proposer to inform the insurer of everything likely to affect the judgment of the insurer, howsoever unimportant it may seem to him (the proposer). Hence, the proposer should ensure that all questions in the proposal form are correctly answered. It may be noted that in the 'proposal' along with other related papers and the representations, made for the grant of insurance, the proposer declares that full and correct information is being furnished by him. Any misrepresentation, non-disclosure or fraud in any document leading to the acceptance of the risk will render the insurance contract null and void. In such an event, there is the possibility of the contract becoming infructuous and the intended beneficiary being deprived of expected benefits because of an unwise act of the proposer. It is, therefore, in the interest of the would-be policyholder to disclose all material facts to the Corporation to avoid the possibility of complications at a future date. Importance of Age Admission The rate of premium payable on a life insurance policy generally varies with age and, therefore, age is one of the most important factors in determining the rate of premium payable in an individual case. It follows that the age of the life to be assured must be proved to the satisfaction of the Corporation. In order of preference, the following will be accepted as evidence of age:
Modes of Payment of Premiums other than single premiums may be paid by the policyholders to LIC in yearly, half-yearly, quarterly or monthly installments. Days of Grace Policyholders are required to pay the premiums to the Corporation on the due dates. One month but not less than thirty days of grace is allowed for payment of yearly, half-yearly and quarterly premiums, and fifteen days for payment of monthly premiums. When the days of grace expire on a Sunday or a holiday observed by the Office of the Corporation where premiums are payable, the premium may be paid on the following working day to keep the policy in force. Revival of Lapsed Policy When the premium is not paid within the days of grace, the policy lapses, It can, however, be revived during the life-time of the assured but before the expiry of a period of five years from the due date of the first unpaid premium and before the date of maturity, if applicable. The Corporation offers three convenient schemes of revival, viz. the Ordinary Revival scheme, the Special Revival scheme and the Installment Revival scheme. It is also possible to revive a policy by raising a loan under the policy provided that the policy is one with loan eligibility and has acquired adequate loan value to pay the arrears of premiums with interest. Requests for revival may be made to the Branch Office servicing the policy. Change of Address and Transfer of Policy Records As and when a policyholder desires a change of his address in the Corporation's records, intimation of such change should be given to the Branch Office servicing his policy. Policy records can be transferred from the Branch Office which services the policy to any other Branch Office nearest to the policyholder's place of residence. The correct address facilitates better service and quicker settlement of claims. Care of Document and Loss of Policy The policy document (policy bond) is an evidence of contract between the insurer and the insured. The policyholder should preserve the policy bond carefully till the contracted amount under it, is settled, as it is required to be submitted to the Corporation at the time of claims. The loss of the policy document, if it occurs, should be immediately intimated to the Branch/Divisional Office of the Corporation where it is serviced. The office will then quote the requirements for a duplicate policy or a copy of the policy, whichever is required by the policyholder. It may, however, be noted that the loss of the policy bond does not extinguish the rights of the policyholder in the policy. Loan At present loans are granted on unencumbered policies up to 90 percent of the Surrender Value under policies which are in force for the full sum assured and up to 85 percent of the Surrender Value on policies which are paid-up for a reduced sum assured. The minimum amount for which a loan can now be granted under a policy is Rs.150/-. The rate of interest charged at present is 100.5 percent or 12 percent per annum payable, payable half yearly, depending on plan per annum payable half-yearly. Loans are not granted for a period shorter than six months, or on the security of lost policies (duplicate policies must be got issued for loan) or on policies issued under certain plans. The Branch Office servicing the policy will quote the loan value on request from the policyholder. Certain types of policies are, however, without loan facility. The terms and conditions printed on the policy bond reveal whether a particular policy is with or without loan facility. Relief to Policyholders The Corporation allows concessions on payment of premiums, settlement of claims, issue of duplicate policies etc. when the policyholders are affected by natural calamities such as droughts, cyclones, floods, earthquakes etc. Nomination/Assignment of Policy When the policy money becomes due for payment on the death of the policyholder, it can be paid only to that person who is legally entitled to give a valid and effective discharge to the Corporation. The importance of nomination/assignment cannot be over-emphasized, especially when a death claim arises. If the policy bears nomination, the claim is settled in favor of the nominee. Similarly, if the policy is assigned, the assignee receives the claim amount. In maturity claims, the payment is made to the life assured, subject to the policy being free from encumbrances. For quick settlement of claims, policyholders are strongly advised to effect either a nomination or an assignment in respect of their policies. It should be noted that an assignment of a policy automatically cancels the existing nomination. Hence, when such a policy is reassigned in favor of the policyholder, it is necessary to make a fresh nomination to avoid delay in payment of the claim. Claim by Maturity/Installment Payment The Corporation strives to settle maturity claims and make periodic payments, as in the case of Money Back Policies, on the due date itself. The branch office concerned which services the policy sends out an intimation regarding the payment along with the necessary discharge voucher for execution by the assured, approximately two months before the due date of such payment. In case the policyholder does not hear from the concerned branch office in this connection, he/she may contact them by quoting the policy number. Death Claim In the event of the death of the policyholder, the claimant (the nominee, assignee or next of kin) should immediately intimate the Branch Office, where the policy is serviced, the fact of such death, alongwith the following particulars:
Soon after the receipt of the intimation of death, the concerned Branch Office will send the necessary claim forms for completion along with instructions regarding the procedure to be followed by the claimant. The claim is usually payable to the nominee/assignee or the legal successor, as the case may be. However, if the deceased policyholder has not nominated/assigned the policy or if he/she has not made a suitable width=450 provision regarding the policy moneys by way of a Will, the claim is payable to the holder of a Succession Certificate or some such evidence of title from a Court of Law. The Corporation, however, may consider settlement of claims under such policies without insisting on the court-evidence-of-title in favor of the natural heirs of the deceased, subject to certain terms and conditions. The Corporation grants claim concessions whereby payment of full sum assured is made, subject to the deduction of unpaid premiums with interest, and premiums falling due before the next anniversary of the policy, in the event of death of the life assured within a period of six months or one year from the date of the first unpaid premium, provided premiums have been paid at least for three years or five years respectively. The Corporation has also provided some relief's as mentioned below, to the claimants under certain plans where, subsequent to the payment of premiums for two full years but less than 3 years, the death takes place after the Days of Grace but within one year from the date of first unpaid premium -
Claims Review Committee
Back to TopE-Mail : kssnarayanan@hotmail.com kssnarayanan@yahoo.com kssnarayanan@sify.com | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
