Bookmark Bookmark

Insurance Notes for LIC AAO 2015-16: LIC (Brief Description & History)

Insurance Notes for LIC AAO 2015-16: LIC (Brief Description & History)

Dear Aspirants,

As LIC AAO Exam is approaching, Onlinetyari has started a series named Insurance notes to provide some keynotes related to the Insurance Industry that will help you out in your preparation for Insurance related Questions. Let's start with brief introduction and History of LIC.

Overview:

IRDA (Insurance Regulatory and Development Authority of India) is the key regulator of Insurance Industry in India. One of the major players in the Indian Insurance Industry is the Life Insurance Corporation of India (LIC). LIC is the country’s largest investor and the largest state-owned life insurance Company within the country till date. It is fully owned by the Government of India. It funds almost 24.5% of total expenses made by the Indian Government. LIC is having almost an asset backup of approximately 9.3 trillion INR (206.6 billion US$).

History:

The stepping stone of Insurance Industry in India was held with the formation of The Oriental Life Insurance Company, the first corporate entity in India offering life insurance coverage. It was established in Calcutta by Bipin Bernard Dasgupta and others in 1818. Initially, the primary target of this company was the Europeans settled in India and it charged heavy premiums from Indians. Other major member includes The Bombay Mutual Life Assurance Society, formed in 1870. It was the first native insurance provider. Other establishments within the insurance industry in the pre-independence era included:

Bharat Insurance Company (1896)
• United India (1906)
• National Indian (1906)
• National Insurance (1906)
• Co-operative Assurance (1906)
• Hindustan Co-operatives (1907)
• Indian Mercantile
• General Assurance
• Swadeshi Life (renamed as Bombay Life)

India’s first 150 years were marked remarkably due to various reasons as India witnessed First War of Independence, effects of the World War I followed by World War II and in between them the period of worldwide economic crises put in a great depression. These events cumulatively resulted in the high rate of bankruptcies and liquidation of life insurance companies in India. This liquidated the people’s faith in the utility of obtaining life cover. In order to rebuild the people’s faith, Life Insurance Act and the Provident Fund Act were passed in 1912, as the first regulatory mechanisms in the Life Insurance industry. The Indian Insurance Companies Act of 1928 authorized the government to obtain statistical information from companies operating in both life and non-life insurance areas. A similar Insurance Act of 1938 brought larger control over an industry that had seen several financially unsound ventures fail. In 1944, a bill was introduced in the Legislative Assembly to nationalize the Insurance Industry.

The LIC was set up as a result in 1956 as a result of an amalgamation of more than 200 insurance companies and provident societies. LIC is Headquartered in Mumbai-The financial and commercial capital of India, the Life Insurance Corporation of India currently has 8 zonal Offices and 101 divisional offices located in different parts of India, at least 2048 branches located in different cities and towns of India along with satellite Offices attached to about some 50 Branches, and has a network of around 1.2 million agents for soliciting life insurance business from the public.

Keep Reading and Don't forget to Bookmark.

Take a quiz on what you read Start Now

You might be interested:

CTET : Syllabus & Exam Pattern

CTET: Syllabus & Exam Pattern Dear Candidates, The Central Teacher Eligibility Test ( CTET ) will be held on 21 February 2016 for recruitment of teachers. It is important that you famili ...

7 years ago

UPSC News : Daily Current Affairs for IAS, February 1, 2016

1. Government expresses willingness to frame law on Euthanasia    After 14 years of debate over this issue, the centre expressed its willingness to frame a law on Passive Euthanasia.  ...

7 years ago

Daily News Digest, 1st February 2016

Atulesh Jindal to take over as new CBDT chairman Senior Indian Revenue Service officer Atulesh Jindal will take charge as the new chairman of the CBDT, the controlling body of the Income Tax departme ...

7 years ago

CBDT signs two bilateral Advance Pricing Agreements with United Kingdom

CBDT signs two bilateral Advance Pricing Agreements with the United Kingdom The Central Board of Direct Taxes has signed two bilateral Advance Pricing Agreements with the United Kingdom on 29th Janu ...

7 years ago

Israel, Turkey sign gas deal agreement

Israel, Turkey sign gas deal agreement Israeli and Turkish energy firms have signed an agreement to sell $1.3 billion worth of gas to Edeltech. The Leviathan natural gas field was discovered in 2010 ...

7 years ago

Engg. Maths - Calculus - Concept Card 3D

ENGG. MATHS - CALCULUS - CONCEPT CARD 3D 3D - INTEGRATION AND ITS APPLICATION Integrals: The following are the two types of integrals: 1. Definite Integrals: Signed Area: A curve above the x-axis is s ...

7 years ago

Provide your feedback on this article: