Annexure-V- Cover Page for Academic Tasks

Course Code: MKT 354 Course Title: Marketing of financial services

Course Instructor: RAJESH POONIA

Academic Task No.: 01 Academic Task Title: LIC Jeevan Anand Policy

Date of Allotment: 22/01/202I Date of submission: 06/02/2021

Student’s Roll no: B037 Student’s Reg. no: 11812257

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students as specified at the time of assigning the task by the instructor)

Learning Outcomes
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student’s work or from any other source except where due acknowledgement is made
explicitly in the text, nor has any part been written for me by any other person.
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 MARKETING OF FINANCIAL SERVICES
MKT 354
Submitted by:

GAURAV ANAND
Registration no.: 11812257
In partial fulfillment for the requirements of the award of the degree
of

BACHELOR OF BUSINESS ADMINISTRATION

“Mittal School of Business”

LOVELY PROFESSIONAL UNIVERSITY

Phagwara, Punjab.

LIC JEEVAN ANAND POLICY

 INTRODUCTION

LIC’s Jeevan Anand Plan could be a traditional savings plan which not only
covers the insured for the chosen policy term, but the life cover continues after
the completion of the policy term till the complete lifetime of the insured. The
plan also earns bonuses during the plan term. Thus, the plan is an Endowment
cum Whole insurance Plan.

In case of death because of an accident before the age of 70, the nominee is
going to be paid an extra cover amount. this extra accidental benefit is capped at
Rs. 5 lakhs. just in case of permanent disability thanks to an accident, this
extra cover amount is paid in installments. No extra
premiums must be obtained these 2 additional benefits. Jeevan Anand may be
a life endowment plan that comes with a mess of advantages for the
policyholders throughout the term period. As per the plan, the insurance cover
continues even after completion of the premium payment term. within the event
of death of a private thanks to an accident, the plan offers an extra cover sum
which is capped at Rs.5 lakhs. But just in case the accident leaves a
policyholder with permanent disability, the plan takes care of the regular
financial needs by paying the sum assured in installments. These additional
benefits offered under LIC Jeevan Anand don't impose extra charges on the
premium amount.

Additionally, you'll be able to avail a Critical Illness rider by paying an

additional premium.

LIC Jeevan Anand was launched on 1st Feb 2002 and was discontinued on 30th
September 2013. it's been replaced with the same plan with better features. look
at details of the LIC New Jeevan Anand Plan.

LIC JEEVAN ANAND POLICY WORKS

The policyholder chooses the duvet Amount (Sum Assured) and the Term of the

plan when buying the policy. If the insured survives the whole chosen term of
the plan, the chosen Sum Assured and the Accumulated Bonuses are paid on
maturity. The plan then continues and therefore
the policyholder doesn't should pay any premiums. When the policyholder
eventually dies, the Sum Assured is paid again to the nominee.

If the insured dies during the term of the plan, the Sum Assured and
the Accumulated Bonuses would be paid and therefore the plan would be
terminated.

We will explain the working of Jeevan Anand with an example:

Suppose Aaditya who is 35 years old buys a Jeevan Anand policy of Rs. 1 lakh
(Sum Assured) for 25 years (Term). His annual premium would be Rs. 4,535

EXAMPLE 1 – Kirat dies in the 15th year of the policy.

In this case, the Sum Assured of Rs. 2.5 lakhs and accumulated bonuses till the
date of death would be paid and the plan would terminate. Bonus is declared
every year by LIC.

EXAMPLE 2 – Altaaf survives till the end of the policy term.

In this case, the Sum Assured of Rs. 5 lakhs and the accumulated bonus till
maturity would be paid to Arun and the risk cover under the plan would
continue. Later, whenever Arun dies, the Sum Assured of Rs. 5 lakhs would
again be paid to his nominee. 

So, the plan benefits are as follows:

Maturity Benefit
When the plan term expires and therefore the insured is alive, the Sum Assured
and any accumulated bonuses are paid.

Death Benefit
 The benefit depends on the year within which the insured dies.

 If the insured dies within the policy term, the Sum Assured and
accumulated bonuses are paid.

 If the insured dies after the completion of the plan term when the
Maturity Benefit is already been paid, the Sum Assured is paid.
 PRODUCT CATEGORY

 Maturity Benefit 

If the chosen term of the plan comes to an end and the insured is alive, a
maturity benefit is paid. This benefit is the sum assured paid along with
the vested reversionary bonuses and any final additional bonus.

On maturity the Basic Sum Assured + accrued bonuses + any Final

Bonus is paid to the policyholder.

 Death Policy

Provided all due premiums have been paid, the following death benefit
shall be paid.

On Death during the policy term: Death benefit, defined as sum of  Sum
Assured on Death and vested Simple Reversionary Bonuses and Final
Additional bonus, if any, shall be payable. Where, Sum Assured on
Death is defined as higher of 125% of Basic Sum Assured or 10 times
of annualized premium. This death benefit shall not be less than 105%
of all the premiums paid as on date of death.

 LIC's Accidental Death and Disability Benefit Rider

LIC's Accidental Death and Disability Benefit Rider is available as an

optional rider by payment of additional premium during the policy
term. In case of accidental death during the policy term, Accident
Benefit Sum Assured will be payable as lumpsum along with the death
benefit under the basic plan. In case of accidental permanent disability
arising due to accident (within 180 days from the date of accident), an
amount equal to the Accident Benefit Sum Assured will be paid in
equal monthly installments spread over 10 years and future premiums
for Accident Benefit Sum Assured as well as premiums for the portion
of Basic Sum Assured which is equal to Accident Benefit Sum Assured
under the policy, shall be waived.
  Rider Policy

Rider is an additional cover which can be opted for along with Base
Policy

Other LIC New Jeevan Anand policy details

1. Paid-up value

If you have got paid the premiums for a minimum of the primary three years of
the policy, the policy acquires a paid-up value. If the long run premiums are
waived off, you'd not lose out on the plan benefits. in this case, the policy would
continue at a reduced paid-up value. The sum assured would be reduced and
would be calculated as follows –Paid-up sum assured = (number of premiums
paid / number of premiums payable) * sum assured

This sum assured would be accustomed calculate the maturity and death

benefits. Moreover, the bonuses which vested before the policy became paid-up
would even be paid.

2. Surrender value

If the policy has acquired a paid-up value, you'll surrender the plan and avail the
surrender value if you are doing not want to continue with the coverage. The
surrender value is higher of the guaranteed surrender value or special surrender
value. The guaranteed surrender value would be calculated because
the aggregate surrender value of premiums paid and bonuses earned. The
special surrender value, on the opposite hand, would rely upon LIC and would
be determined from time to time.

3. Revival

You can revive a lapsed policy provided the revival is finished within 2

years from the date of lapse. To revive, the outstanding premiums
would must be paid together with a signal of insurability.

4. Loan
 Loans are available providing the primary three years’ premiums are paid.
The quantum of the loan depends on the surrender value acquired by the
plan.

ELIGIBILITY conditions
MINIMUM MAXIMUM
Sum Assured (in Rs.) 100000 No Limit

Policy Term (in years) 15 35

Premium Payment Term (in 3 57

years)
Entry Age of Policyholder 18 Years 50Years
(last birthday)
Age at Maturity (last - 75
birthday)
Payment modes Yearly, Half-yearly, Quarterly, Monthly

DOCUMENS REQUIRE FOR LIC JEEVAN ANAND POLICY

To buy LIC’s New Jeevan Anand Plan, one has to submit the following
documents:

 Plan Proposal Form duly filled in and signed

 Cheque or cash for the first premium
 A passport sized photograph
 A valid Identity Proof
 A valid Address Proof
 Date of Birth Proof

FEATURES OF LIC JEEVAN ANAND POLICY

  This plan is an endowment cum whole life plan.
 Maturity Benefit is Sum Assured + accrued Bonus and the Life Cover
continues till death.
 Death Benefit after Policy Maturity is only Sum Assured.
 Death Benefit before Policy Maturity is Sum Assured + accrued Bonus.
 Simple Reversionary Bonus is payable on maturity or earlier death.
 Accidental Death and Disability Benefit is an inbuilt feature in this plan.
 Optional higher cover through 1 additional rider of Critical Illness
Benefit.
 This plan can be provided to people with hazardous occupation with
additional premium.
 Large Sum Assured rebate is also provided.

Tax benefits of lic Jeevan anand policy

Premiums paid
The premiums paid for the plan are exempt from taxation under Section 80C of
the Income Tax Act. The maximum exemption that can be availed is Rs. 1.5
lakhs.

Claims Amount 
Maturity or death claims received would be tax-free under Section 10(10D) of
the Income Tax Act. There is no limit on the amount of claim received and the
entire claim would be tax-free.

Competitors Market Share Market Growth Rate (2019-20)

LIC 66.2% 52.78%

HDFC Life Insurance 7.00% 14.25%

SBI life Insurance 6.40% 9.15%

ICICI Prudential Life 4.80% 6.35%

Insurance
Others 15.60% 17.48

Market structure

MARKET SHARE Fig.1

Market share growth rate Fif.1

LIC Market share

The insurance Corporation of India held approximately 66.20 percent of the

market share of the sector's total insurance in yr. 2019. LIC is that the only
public sector insurer in India.

LIC Market Growth Rate

LIC's composite market share in number of policies touched 52.78 per cent

in 2019-20, registering a growth of 1.19 per cent. Similarly, its market share in
first-year premium touched 68.74 per cent last fiscal with a growth of 2.5 per
cent.

Factors shaping the future of market

The government has started the method to launch the initial public offer (IPO)
of life assurance Corporation (LIC) within this year. The IPO is predicted to
be the most important within the Indian capital markets given the scale and
scale of LIC, the country’s oldest and largest life insurer. The finance ministry
last week invited bids from transaction advisors, including consulting firms,
investment bankers, and financial institutions, for assisting the govt within
the preparatory processes resulting in the IPO.

 IPO Could Bring Transparency to LIC Operations.

The government is not off course to sell a little of its equity in LIC because
it has not received any opposition to the proposal up to now. While stake
sale within the country’s largest and oldest life insurer will depend on market
conditions, the Finance Ministry has started work on finalizing modalities and
seeking necessary approvals. LIC’s initial public offering are going to
be significant in bringing transparency in operations of the Corporation, while
enabling the govt to boost funds through disinvestment.

 Benefits Can be Expected Through the IPO

An IPO will herald transparency into affairs of LIC since it'll be required to
tell financial numbers and other market-related developments on time to the
stock exchanges. Investors can enjoy learning equity within the insurer, which
has been making underwriting profit similarly as profits on its investments.
LIC’s investment in various equity and bond instruments will come under
greater scrutiny after its lists on the exchanges.

 Size and Position of LIC in Insurance Market

Even if the govt. decides to sell 5-10 per cent of its equity in LIC through an
IPO, the share sale of LIC, which was founded in 1956, is anticipated to be the
most important. The insurer’s total assets had touched an all-time high of Rs
31.11 lakh crore in 2018-19, a rise of 9.4 per cent. The Corporation realized a
profit of Rs 23,621 crore from its equity investment during 2018-19, down 7.89
per cent from Rs 25,646 crore within the previous year. The LIC had 66.24 per
cent market share in total first-year premium and 74.71 per cent share in new
policies in 2018-19, as per its latest available Annual Report. the govt. has
sought to appoint to 2 pre-IPO transaction advisors, who should have
successfully managed a minimum of one transaction of IPO of a size of a
minimum of Rs 5,000 crore, or a capital market transaction of a minimum of Rs
15,000 crore.

SALES PROCCES USED IN LIC JEEVAN ANAND

POLICY

Our sales process involved Jeevan Anand Policy selling. Our product being an
intangible one, it needs the corporate personnel to travel and persuade the
customer via addressing tohis doubts and concerns. we'd like to undergo
requisite interaction with the prospective customers to measure their mood
with relation to different price levels. because the sales personnel also
are attentive to the competitors’ price and, supported the market reaction and
customers’ sentiments, they will advise a more prudent price policy to the
management. The salesperson stimulates and generates enough interest within
the customer and helps him make the ultimate decision to shop for the
merchandise.

Steps in personal selling Personal selling involves six important steps: -

PROSPECTING

Prospecting is that the process of identifying the potential buyers of the

merchandise. The prospects are those that have the requirement or will to shop
for and the power to pay. a chance disqualified if he has the authority, need,
ability and eligibility to shop for. In our context prospects accustomed be the
owners just in case of a tiny low company and Promotions &Advertising
head in this of a giant organization.

WAYS OF IDENTIFYING PROSPECT

  Acquaintance Reference

A satisfied customer is often a decent source of information about the names,

addresses and phone numbers of the prospects who could also be among his
acquaintances, relatives, or relations. additionally, we accustomed give
reference of our other satisfied customer to motivate the prospect to shop for,
thus obtaining further references.

 Cold Calling

 During this method we accustomed randomly call a customer without any

reference, with an anticipation of converting the decision into sale. This
method is additionally called ‘random prospecting.’

 Centre of Influence Method

Using this approach, we obtained the references for prospects from eminent
people of society. Using such references, the prospects are influenced to form a
buying decision since the recommendations of eminent personalities are taken
seriously.

 Direct Mail or Telephone Method

This was the foremost frequently used method by us. We want to contact the

possible buyer on the phone and inform him about our product, price range,
benefits etc. We also accustomed send mail/letters to our existing customers
informing them about modifications made within the existing range.

 Company’s Record

We were provided contacts of the potential customers from company’s own

records. we'd like to follow up with them and acquire appointments and make
sales.

 Pre – Approach

Pre – Approach is that the second step within the selling process which

emphasizes that salesman should know, after identifying the prospects within
the prospecting stage, the prospect’s likes and dislikes, his needs, preferences,
habits, nature, behaviour, economic and social station etc. supported all this
information, the salesperson has the mandatory tools to plan his visit/interview
with the prospect and might give an efficient sales presentation. This kind of
preparation to satisfy the prospect is named the pre – approach. Because of pre-
approach we gained ample knowledge about the prospect. This helped us in
giving the presentation more efficiently, effectively, and confidently.

 Approaching

 During this stage the prospect and therefore the salesman are available in contact

with one another face to face. Here the salesperson has the chance to grasp and
interact with the prospect in a higher way. Hence, the
salesperson should advance his best efforts to create the best use of this chance in
getting the eye of the prospect and to convince him to buy the product. Hence,
getting the eye of the prospect and persuading him to shop for are the two main
objectives of a salesman. The importance of the approach cannot be
overemphasized since it's only after the salesperson starts interacting directly with
the prospect that the latter decides within the primary jiffy whether
he must purchase or not. Similarly, the salesperson has the chance to
gauge whether the prospect is in the mood to shop for or not.

 Direct approach:

We accustomed directly approach the prospect with no introduction whatsoever

and conduct an interview. We stated the advantages of our product and tried to
arouse interest of the prospect.

CONCLUSION
After completing the project it's concluded that LIC develop its various plans
and policies, flexible in nature, in step with the necessities of its targeted market
or customers and is thus beneficial to its customers in various ways. the
foremost important benefit it provides to its customers is that it's a government
owned company. This result in increase within the satisfaction level of its
customer that's why LIC has quite 200 million policyholders which is adequate
to the fourth largest country in world. Therefore, it's not only beneficial but
better than other insurance companies not only regarding its product but also its
services.