A Project Report on Tata Aig

8/2/2019 A Project Report on Tata Aig

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Summer Training Project Report

(Completed In Tata AIG Bareilly)

Topic : Comparison Between ULIPs And Traditional Plans

Submitted To: - Submitted By:-

Mr. PAVAN RATHI MOHD. ZUBAIR M.B.A. 3rd sem.Roll No.:-820860072

G.J.E.S. Bareilly.

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Preface

This Project Report is done to study Comparative analysis of ULIPs V/sTraditional plans

This Project Report is done by collecting the data from some magazine, TataAIG life website, text book of life insurance. Money simplified (text book).Neev: product book.

All the data has been gathered and then properly analyzed. The findings havebeen presented in a lucid manner.

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ACKNOWLEDGEMENT

Generally it is said that there is always a theory works behind practical but Ipersonally observed and reached to the conclusion that there is a practicalbehind every theory.To fulfill the requirement of our academic curriculum andto attain practical knowledge the present project work has been conductedunder the mutual guidance of our academic lecture and corporateprofessionals.

I would like to thanks Mr. Sailesh verma (Branch Manager of Tata AIG lifeBareilly) and DR. Mohd Asive Khan (convenor of Business Administration)who helped me throughout the project.

Last but not the least I would like to give a word of appreciation to those whohave provided their full support for the successful completion of this project.

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INTRODUCTION

Life insurance is a contract that pledges payment of an amount to the personassured (or his nominee) on the happening of the event insured against. Thecontract is valid for payment of the insured amount during: 1- The date ofmaturity, or 2- Specified dates at periodic intervals, or 3-Unfortunate death, if itoccurs earlier.

IN other words its a written contract or certificate of insurance that providesprotection against future loss. A promise of reimbursement in the case of loss;

paid (sum assured) to people or companies (insured) so concerned abouthazards that they have made prepayments (premiums) to an insurancecompany (insurer).

Insurance is a contractual arrangement that provides for compensation by aninsurer to an insured party if or when a specified set of circumstances occurs.Such circumstances may include death or personal injury, accident,unemployment or old age, loss of or damage to property, or any one of anumber of instances that can be compensated for financially.

The insurer conducts its operations by amassing relatively small contributionsfrom many people who are exposed to the risk of occurrence of an unforeseenevent in order to create a fund that is used to reimburse those insured whoactually suffer from such an occurrence. The contributions of the policyholdersare called premiums.

A contract of insurance is embodied in a policy that specifies the terms underwhich the insurer agrees to indemnify the policyholder for loss in considerationof the payment of a stated premium or premiums.

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Brief History of Insurance Sector

The roots of insurance might be traced to Babylonia, where traders wereencouraged to assume the risks of the caravan trade through loans that wererepaid (with interest) only after the goods had arrived safelya practiceresembling bottomry and given legal force in the Code of Hammurabi (c.2100BC). The Phoenicians and the Greeks applied a similar system to theirseaborne commerce. The Romans used burial clubs as a form of lifeinsurance, providing funeral expenses for members and later payments to thesurvivors.

With the growth of towns and trade in Europe, the medieval guilds undertookto protect their members from loss by fire and shipwreck, to ransom them fromcaptivity by pirates, and to provide decent burial and support in sickness andpoverty. By the middle of the 14th cent., as evidenced by the earliest knowninsurance contract (Genoa, 1347), marine insurance was practically universalamong the maritime nations of Europe. In London, Lloyd's Coffee House(1688) was a place where merchants, ship owners, and underwriters met totransact business.

By the end of the 18th cent. Lloyd's had progressed into one of the firstmodern insurance companies. In 1693 the astronomer Edmond Halleyconstructed the first mortality table, based on the statistical laws of mortalityand compound interest. The table, corrected (1756) by Joseph Dodson, madeit possible to scale the premium rate to age; previously the rate had been thesame for all ages.

Insurance developed rapidly with the growth of British commerce in the 17thand 18th cent. Prior to the formation of corporations devoted solely to the

business of writing insurance, policies were signed by a number of individuals,each of whom wrote his name and the amount of risk he was assumingunderneath the insurance proposal, hence the term underwriter.

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The first stock companies to engage in insurance were chartered in England

in 1720, and in 1735, the first insurance company in the American colonieswas founded at Charleston, S.C. Fire insurance corporations were formed inNew York City (1787) and in Philadelphia (1794). The Presbyterian Synod ofPhiladelphia sponsored (1759) the first life insurance corporation in America,for the benefit of Presbyterian ministers and their dependents. After 1840, withthe decline of religious prejudice against the practice, life insurance entered aboom period. In the 1830s the practice of classifying risks was begun.

The New York fire of 1835 called attention to the need for adequate reserves

to meet unexpectedly large losses; Massachusetts was the first state torequire companies by law (1837) to maintain such reserves. The greatChicago fire (1871) emphasized the costly nature of fires in structurally densemodern cities. Reinsurance, whereby losses are distributed among manycompanies, was devised to meet such situations and is now common in otherlines of insurance.

The Workmen's Compensation Act of 1897 in Britain required employers toinsure their employees against industrial accidents. Public liability insurance,fostered by legislation, made its appearance in the 1880s; it attained major

importance with the advent of the automobile.

In the 19th cent. Many friendly or benefit societies were founded to insure thelife and health of their members, and many fraternal orders were created toprovide low-cost, members-only insurance. Fraternal orders continue toprovide insurance coverage, as do most labor organizations.

Many employers sponsor group insurance policies for their employees; suchpolicies generally include not only life insurance, but sickness and accident

benefits and old-age pensions, and the employees usually contribute a certainpercentage of the premium.

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Since the late 19th cent. there has been a growing tendency for the state to

enter the field of insurance, especially with respect to safeguarding workersagainst sickness and disability, either temporary or permanent, destitute oldage, and unemployment . The U.S. government has also experimented withvarious types of crop insurance, a landmark in this field being the FederalCrop Insurance Act of 1938. In World War II the government provided lifeinsurance for members of the armed forces; since then it has provided otherforms of insurance such as pensions for veterans and for governmentemployees.

After 1944 the supervision and regulation of insurance companies, previouslyan exclusive responsibility of the states, became subject to regulation byCongress under the interstate commerce clause of the U.S. Constitution. Untilthe 1950s, most insurance companies in the United States were restricted toproviding only one type of insurance, but then legislation was passed to permitfire and casualty companies to underwrite several classes of insurance.

Many firms have since expanded, many mergers have occurred, and multiple-line companies now dominate the field. In 1999, Congress repealed bankinglaws that had prohibited commercial banks from being in the insurance

business; this measure was expected to result in expansion by major banksinto the insurance arena.

In recent years insurance premiums (particularly for liability policies) haveincreased rapidly, leaving unprecedented numbers of Americans uninsured.Many blame the insurance conglomerates, contending that U.S. citizens arepaying for bad risks made by the companies.

Insurance companies place the burden of guilt on law firms and their clients,

who they say have brought unreasonably large civil suits to court, a trend thathas become so common in the United States that legislation has beenproposed to limit lawsuit awards. Catastrophic earthquakes, hurricanes, andwildfires in late 1980s and the 90s have also strained many insurancecompany's reserves.

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History Of Insurance Sector In India

In India, insurance has a deep-rooted history. It finds mention in the writings ofManu (Manusmrithi), Yagnavalkya (Dharmasastra) and Kautilya (Arthasastra).The writings talk in terms of pooling of resources that could be re-distributed intimes of calamities such as fire, floods, epidemics and famine. This wasprobably a pre-cursor to modern day insurance. Ancient Indian history haspreserved the earliest traces of insurance in the form of marine trade loansand carriers contracts. Insurance in India has evolved over time heavilydrawing from other countries, England in particular.

1818 saw the advent of life insurance business in India with theestablishment of the Oriental Life Insurance Company in Calcutta. ThisCompany however failed in 1834. In 1829, the Madras Equitable had beguntransacting life insurance business in the Madras Presidency. 1870 saw theenactment of the British Insurance Act and in the last three decades of thenineteenth century, the Bombay Mutual (1871), Oriental (1874) and Empire ofIndia (1897) were started in the Bombay Residency. This era, however, wasdominated by foreign insurance offices which did good business in India,namely Albert Life Assurance, Royal Insurance, Liverpool and London Globe

Insurance and the Indian offices were up for hard competition from the foreigncompanies

In 1914, the Government of India started publishing returns of InsuranceCompanies in India. The Indian Life Assurance Companies Act, 1912 was thefirst statutory measure to regulate life business. In 1928, the Indian InsuranceCompanies Act was enacted to enable the Government to collect statisticalinformation about both life and non-life business transacted in India by Indianand foreign insurers including provident insurance societies.

In 1938, with a view to protecting the interest of the Insurance public, theearlier legislation was consolidated and amended by the Insurance Act, 1938with comprehensive provisions for effective control over the activities ofinsurers.

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The Insurance Amendment Act of 1950 abolished Principal Agencies.However, there were a large number of insurance companies and the level of

competition was high. There were also allegations of unfair trade practices.The Government of India, therefore, decided to nationalize insurancebusiness.

An Ordinance was issued on 19th January, 1956 nationalizing the LifeInsurance sector and Life Insurance Corporation came into existence in thesame year. The LIC absorbed 154 Indian, 16 non-Indian insurers as also 75provident societies245 Indian and foreign insurers in all. The LIC hadmonopoly till the late 90s when the Insurance sector was reopened to the

private sector.

The history of general insurance dates back to the Industrial Revolution inthe west and the consequent growth of sea-faring trade and commerce in the17th century. It came to India as a legacy of British occupation. GeneralInsurance in India has its roots in the establishment of Triton InsuranceCompany Ltd., in the year 1850 in Calcutta by the British. In 1907, the IndianMercantile Insurance Ltd was set up. This was the first company to transact allclasses of general insurance business. In 1968, the Insurance Act wasamended to regulate investments and set minimum solvency margins. The

Tariff Advisory Committee was also set up then.

In 1972 with the passing of the General Insurance Business (Nationalization)Act, general insurance business was nationalized with effect from 1st January,1973. 107 insurers were amalgamated and grouped into four companies,namely National Insurance Company Ltd., the New India Assurance CompanyLtd., the Oriental Insurance Company Ltd and the United India InsuranceCompany Ltd. The General Insurance Corporation of India was incorporatedas a company in 1971 and it commence business on January 1sst 1973.

This millennium has seen insurance come a full circle in a journey extendingto nearly 200 years. The process ofre-opening of the sectorhad begun inthe early 1990s and the last decade and more has seen it been opened upsubstantially. In 1993, the Government set up a committee under thechairmanship of RN Malhotra, former Governor of RBI, to proposerecommendations for reforms in the insurance sector.

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The objective was to complement the reforms initiated in the financialsector. The committee submitted its report in 1994 wherein, among other

things, it recommended that the private sector be permitted to enter theinsurance industry. They stated that foreign companies are allowed to enter byfloating Indian companies, preferably a joint venture with Indian partners.

Following the recommendations of the Malhotra Committee report, in 1999,the Insurance Regulatory and Development Authority (IRDA) was constitutedas an autonomous body to regulate and develop the insurance industry. TheIRDA was incorporated as a statutory body in April, 2000. The key objectivesof the IRDA include promotion of competition so as to enhance customer

satisfaction through increased consumer choice and lower premiums, whileensuring the financial security of the insurance market.

The IRDA opened up the market in August 2000 with the invitation forapplication for registrations. Foreign companies were allowed ownership of upto 26%. The Authority has the power to frame regulations under Section 114Aof the Insurance Act, 1938 and has from 2000 onwards framed variousregulations ranging from registration of companies for carrying on insurancebusiness to protection of policyholders interests.

In December, 2000, the subsidiaries of the General Insurance Corporation ofIndia were restructured as independent companies and at the same time GICwas converted into a national re-insurer. Parliament passed a bill de-linkingthe four subsidiaries from GIC in July, 2002.

The insurance sector is a colossal one and is growing at a speedy rate of15-20%. Together with banking services, insurance services add about 7% tothe countrys GDP. A well-developed and evolved insurance sector is a boonfor economic development as it provides long- term funds for infrastructure

development at the same time strengthening the risk taking ability of thecountry.

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The insurance sector in India has Came in a full circle from being an opencompetitive market to nationalization and back to a liberalized market again.

Tracing the developments in the Indian insurance sector reveals the 360-degree turn witnessed over a period of almost 190 years. The business of lifeinsurance in India in its existing form started in India in the year 1818 with theestablishment of the Oriental Life Insurance Company in Calcutta.

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Some of the important milestones in the life insurance business in Indiaare:

1912 - The Indian Life Assurance Companies Act enacted as the first statuteto regulate the life insurance business.

1928 - The Indian Insurance Companies Act enacted to enable thegovernment to collect statistical information about both life and non-lifeinsurance businesses.

1938 - Earlier legislation consolidated and amended to by the Insurance Actwith the objective of protecting the interests of the insuring public.

1956 - 245 Indian and foreign insurers and provident societies taken over bythe central government and nationalized. LIC formed by an Act of Parliament,viz. LIC Act, 1956, with a capital contribution of Rs. 5 crore from theGovernment of India.

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INDIAN INSURANCE COMPANY

S.No. RegistrationNumber

Date of Reg. Name of the Company

1 101 23.10.2000 HDFC Standard Life InsuranceCompany Ltd.

2 104 15.11.2000 Max New York Life Insurance Co.Ltd.

3 105 24.11.2000 ICICI Prudential Life InsuranceCompany Ltd.

4 107 10.01.2001 Kotak Mahindra Old Mutual LifeInsurance Limited

5 109 31.01.2001 Birla Sun Life Insurance CompanyLtd.

6 110 12.02.2001 Tata AIG Life Insurance CompanyLtd.

7 111 30.03.2001 SBI Life Insurance Company

Limited .

8 114 02.08.2001 ING Vysya Life InsuranceCompany Private Limited

9 116 03.08.2001 Bajaj Allianz Life InsuranceCompany Limited

10 117 06.08.2001 Metlife India Insurance CompanyLtd.

11 133 04.09.2007 Future General India Life InsuranceCompany Limited

12 135 19.12.200 7 IDBI Fortis Life InsuranceCompany Ltd.

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http://www.hdfcinsurance.com/http://www.hdfcinsurance.com/http://www.maxnewyorklife.com/http://www.maxnewyorklife.com/http://www.iciciprulife.com/http://www.iciciprulife.com/http://www.omkotakmahindra.com/http://www.omkotakmahindra.com/http://www.birlasunlife.com/http://www.birlasunlife.com/http://www.tata-aig-life.com/http://www.tata-aig-life.com/http://www.sbilife.co.in/http://www.sbilife.co.in/http://www.ingvysyalife.com/http://www.ingvysyalife.com/http://www.allianzbajaj.co.in/http://www.allianzbajaj.co.in/http://www.allianzbajaj.co.in/http://www.metlife.co.in/http://www.metlife.co.in/http://www.hdfcinsurance.com/http://www.hdfcinsurance.com/http://www.maxnewyorklife.com/http://www.maxnewyorklife.com/http://www.iciciprulife.com/http://www.iciciprulife.com/http://www.omkotakmahindra.com/http://www.omkotakmahindra.com/http://www.omkotakmahindra.com/http://www.omkotakmahindra.com/http://www.birlasunlife.com/http://www.birlasunlife.com/http://www.birlasunlife.com/http://www.tata-aig-life.com/http://www.tata-aig-life.com/http://www.sbilife.co.in/http://www.sbilife.co.in/http://www.ingvysyalife.com/http://www.ingvysyalife.com/http://www.ingvysyalife.com/http://www.ingvysyalife.com/http://www.allianzbajaj.co.in/http://www.allianzbajaj.co.in/http://www.allianzbajaj.co.in/http://www.allianzbajaj.co.in/http://www.metlife.co.in/http://www.metlife.co.in/http://www.metlife.co.in/


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Yr: 2001-2002: (From 1st Jan 2001 to Dec. 2002)Insurance Industry in this year, so far has 5new entrants; namely

Life Insurers:


Date of Reg. Name of theCompany

1 121 03.01.2002 AMP Sanmar LifeInsuranceCompany Limited.

2 122 14.05.2002 Aviva LifeInsurance Co.India Pvt. Ltd.

Yr: 2003-2004 : ( From 1st Jan 2003 till Date)Insurance Industry in this year, so far has 1new entrants; namely

Life Insurers:

S.No. Registration

Number

Date of Reg. Name of the

Company

1 127 06.02.2004 Sahara IndiaInsuranceCompany Ltd.

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http://www.avivaindia.com/http://www.avivaindia.com/http://www.avivaindia.com/http://www.saharalife.com/http://www.saharalife.com/http://www.saharalife.com/http://www.avivaindia.com/http://www.avivaindia.com/http://www.avivaindia.com/http://www.avivaindia.com/http://www.saharalife.com/http://www.saharalife.com/http://www.saharalife.com/


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Yr: 2004-2005 :

Insurance Industry in this year, so far has 1new entrants; namely

Life Insurers:


Date of Reg. Name of theCompany

1 128 17.11.2005 Shriram LifeInsuranceCompany Ltd.

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There are 18 private Co. which are working in life insurance sector:-

1-Bajaj Allianz

2-ICICI Prudential

3- HDFC Standard

4-SBI Life

5-Birla Sun life

6-Tata AIG life

7-Max New York Life

8-Aviva Life

9-Kotak Mahindra10-ING Vysya

11-Reliance Life

12-Met Life

13-Sahra Life

14-Shriram Life

15-Bharti Axa Life

16- Life insurance corporation

17- Future General India Life Insurance

18- IDBI Fortis Life Insurance Company Ltd.

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Indian Insurance Industry Forecast (2008-2009)

Life insurance market in India will likely reach around Rs 1683 Billion by theyear 2009. Changing consumer behavior, GDP growth rate, changing socioeconomic demography, and natural calamities occurring from time to time willremain the key contributors in this growth. The market is expected to grow at aCAGR of more than 200% YOY from the year 2006.

Outstanding performance of SBI Life, ICICI Prudential, and LIC helped theIndian life insurance industry in mopping up almost Rs 2,892 crore. On theother hand, Reliance Life, ING Vysya, and Bajaj Allianz were amongst thoseinsurers that came across a decline in their premium collection over the reviewperiod, as per the data compiled by Insurance Regulatory & Development

Authority.

Key Issues:-

There are some issues and facts that are critical to business success:- What are the marketing strategies of the players in the insurance industry?- How is the growth in Health and Group insurance are driving the Insurancesector in India?- What are the opportunities for the players in this industry and what are thechallenges to sustain the Insurance market in India?- What will be the prospective areas of investments in the insurance industryin the near future?- Which factors will lead to the growth of Life and Non-life insurance in India?

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Key Players

This section provides an overview of some of the key players in this industrylike

1- Bajaj Allianz,2- ING Vysya,

3- SBI Life,4-Tata AIG Life,5- HDFC Standard,6- ICICI Prudential Life Insurance,7- Birla Sun life,8-Aviva Life Insurance,9- Kotak Mahindra Old Mutual,10- Max New York Life,11- Met Life,

12- Sahara Life,13-LIC,14- Royal Sundaram,15- Tata-AIG General,16-Reliance General,17- IFFCO-Tokio,18-ICICI-Lombard,19- HDFC Chubb,20- New India Assurance Company Limited,21- National Insurance Company Limited,

22-United India Insurance Company Limited23- Oriental Insurance Limited.

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The industry is under immense pressure to cut its costs. Regulation byorganizations such as the Financial Services Authority (FSA) and the EU isincreasing, and this is undoubtedly adding to the industry's cost base. At thesame time, premium rates have been softening as insurers have undercuteach other's prices in order to win business. How long this situation willcontinue is debatable, given that many in the industry believe that premiumrates need to rise in order to make up for growth in the cost of claims. There is

inevitably some concern about profitability in the industry.

Particular attention is being paid to long-term insurance, since this sectoraccounts for the majority of sales. Changes in the rules governing the sale ofinsurance (as laid down by the FSA) have opened up new channels ofdistribution, with the result that insurance companies have increased theirnumber of outlets.

However, the big problem for the industry is that people are not saving

enough. In October 2005, the Pensions Commission will deliver itsrecommendations on how to address the so-called pensions gap, i.e. thedifference between the amount consumers need to save for their retirementand the amount they are actually saving. The Commission may recommendsome element of compulsion in personal pensions.

The insurance market will grow by between 3.3% and 3.7% each yearbetween 2005 and 2009. Unless consumer behaviour changes dramatically orthe Government makes personal pensions compulsory, sales of generalinsurance are likely to continue to grow faster than sales of long-term

insurance.

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Tata AIG

Tata AIG Life Insurance Company Limited (Tata AIG Life) is a joint venturecompany, formed by the Tata Group and American International Group,Inc. (AIG). Tata AIG Life combines the Tata Groups pre-eminent leadership

position in India and AIGs global presence as the worlds leading internationalinsurance and financial services organization. The Tata Group holds 74 percent stake in the insurance venture with AIG holding the balance 26 percent.Tata AIG Life provides insurance solutions to individuals and corporate. Tata

AIG Life Insurance Company was licensed to operate in India on February 12,2001 and started operations on April 1, 2001.

Tata AIG General Insurance Company, which started its operation in India onJan 22, 2001, offers the complete range of insurance for automobile, homepersonal, accident, travel, energy, marine, property and casualty, as well as

several specialized financial lines.

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Tata AIG Life Insurance Company Ltd. and Tata AIG General Insurance

Company Ltd. (collectively "Tata AIG") are joint venture companies, formed

from the Tata Group and American International Group, Inc. (AIG). Tata AIG

combines the strength and integrity of the Tata Group with AIG's international

expertise and financial strength.

TATA AIG VISION

To be the fastest growing Life Insurance Company in India, measured by

annualized premium growth, procuring persistent business, delivering first

class customer service, adding shareholder value in the coming year.

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HISTORY OF TATA GROUP

The TATA group is India's best-known industrial group in the private sectorwith a turnover of around US $ 10.4 billion (equivalent to 2.4% of India's

GDP). It is India's most respected private business group. With 219000employees across 94 major companies, it is also India's largest employer inthe private sector.

Founded by Jamsetji Tata in the 1860s, the Tata group's early years wereinspired by the spirit of nationalism. The Tata group pioneered several firsts inIndian industry: India's first private sector steel mill, first private sector powerutility, first luxury hotel chain and first international airline, amongst others. Inmore recent times, the Tata group's pioneering spirit continues to be

showcased by companies like Tata Consultancy Services (TCS), today Asia'slargest software and services company, and Tata Engineering, the first carmaker in a developing country to design and produce a car from the groundup.The Tata group has always sought to be a value-driven organization. Thesevalues continue to direct the group's growth and businesses. The five coreTATA values underpinning the way we do business are:-

Integrity: -

We must conduct our business fairly, with honesty and transparency.Everything we do must stand the test of public scrutiny.

Understanding-We must be caring, show respect, compassion and humanity for ourcolleagues and customers around the world and always work for the benefit ofIndia.

Excellence: -We must constantly strive to achieve the highest possible standards in our dayto day work and in the quality of the goods and services we provide.

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Unity: -We must work cohesively with our colleagues across the group and with ourcustomers and partners around the world, building strong relationships basedon tolerance, understanding and mutual cooperation.

Responsibility: -

We must continue to be responsible, sensitive to the countries, communitiesand environments in which we work, always ensuring that what comes fromthe people goes back to the people many times over.

Business Sectors:-The TATA Group operates business in seven key industry sectors. The chartbelow illustrates how, in percentage terms, TATA companies in each of thesesectors contribute to the overall makeup of the group. The table follows thegroup's sector wise financial performance.

The Tata brand is recognized as the largest homegrown brand in India andthe most respected brand across consumer segments. The Tata Group'sstable of brands also include many national and some internationallyrenowned product and service brands, including Tata Indica, Tata Indigo, TataSafari, Taj(Hotels, Resorts & Palaces), Voltas, Tata Tea, Tata Sault, Titen,Tanishq, Westside and the largest addition, Tata Indicom.

The Tata Group has always believed in returning wealth to the society itserves. Thus, nearly two-third of the equity of Tata sons, the Tata Group's

promoter company, is held by philanthropic trusts which have created a hostof national institutes in community development, education and researchcenters, hospitals and scientific and cultural establishments.

The trusts also give substantial annual grants and endowments to deservingindividuals and institution in the areas of education, healthcare and socialupliftment.

By combining ethical values with business acumen, globalization with nationalinterests and core business with emerging ones, the Tata Group aims to bethe largest and most respected global brand from India whilst fulfilling its long-standing commitment to improving the quality of life of its stakeholders.

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FAMILY TREE

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Jamsetji Tata

Founder of India's largest and internationally best known group ofcompanies, Began with a textile mill in central India in the 1870s

Sir Dorabji Tata

Sir Dorabji Tata

Trust (1932)

Sir Ratan Tata

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Jehangir Ratanji Dadabhoy Tata(1904 - 1993)

Ratan N. Tata

Group Chairman

1868: Jamsetji Nusserwanji Tata starts a private trading firm, laying thefoundation of the Tata Group.

1974-The Central India Spinning, Weaving and Manufacturing Company is setup, marking the Group's entry into textiles.

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1902-The Indian Hotels Company is incorporated to set up the Taj MahalPalace and Tower, India's first luxury hotel, which opened in 1903.

1907 The Tata Iron and Steel Company (now Tata Steel) is established toset up India's first iron and steel plant in Jamshedpur. The plant startedproduction in 1912.

1910-The first of the three Tata Electric Companies, the Tata Hydro-ElectricPower Supply Company, (now Tata Power) is set up.

1911-The Indian Institute of Science is established in Bangalore to serveas a centre for advanced learning.

1912:-Tata Steel introduces eight-hour working days, well before such asystem was implemented by law in much of the West.

1917:-The Tata enter the consumer goods industry, with the Tata Oil Mills

Company being established to make soaps, detergents and cooking oils.

1932:-Tata Airlines, a division of Tata Sons, is established, opening up the aviationsector in India.

1939:-Tata Chemicals, now the largest producer of soda ash in the country, isestablished

1945:-Tata Engineering and Locomotive Company (renamed Tata Motors in2003) is established to manufacture locomotive and engineering products.Tata Industries is created for the promotion and development of hi-techindustries

1954:-Jawaharlal Nehru, India's first Prime Minister, requests the Group tomanufacture cosmetics in India, leading to the setting up of Lakme

1954:-India's major marketing, engineering and manufacturing organisation,Voltas, is established.

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1962:-Tata Finlay (now Tata Tea), one of the largest tea producers, isestablished. Tata Exports is established. Today the company, renamed TataInternational, is one of the leading export houses in India

1968:-Tata Consultancy Services (TCS),India's first software services company, is established as a division of TataSons.

1970:-Tata McGraw-Hill Publishing Company is created to publish educationaland technical books. Tata Economic Consultancy Services is set up to provideservices in the field of industrial, marketing, statistical and techno-economicresearch and consultancy.

1984:-Titan Industries a joint venture between the Tata Group and the TamilNadu Industrial Development Corporation (TIDCO) is set up to manufacturewatches.

1991:-Tata Motors rolls out its millionth vehicle. (The two-million mark wasreached in 1998 and the third million in 2003.)

1999:-The new Tata Group corporate mark and logo are launched.

2000:-Tata Tea acquires the Tetley Group, UK. This is the first majoracquisition of an international brand by an Indian business group.

2001:-Tata AIG a joint venture between the Tata Group and American

International Group Inc (AIG) marks the Tatare-entry into insurance. (The Group's insurance company, New India

Assurance, was nationalised in 1956)

The Tata Group Executive Office (GEO) is set up to design and implementchange in the Tata Group and to provide long-term direction

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2002:-The Tata Group acquires a controlling stake in VSNL*, India's leadinginternational telecommunications service providerTata Consultancy Services (TCS) becomes the first Indian software companyto cross one billion dollars in revenues-Titan launches Edge, the slimmest watch in the world

Idea Cellular, the cellular service born of a tie-up involving the Tata Group, the

Birla Group and AT&T, is launched.Tata Indicom, the umbrella brand for telecom services from the TataTeleservices stable, starts operations

2003:-Tata Motors launches CityRover Indicas fashioned for the Europeanmarket. The first batch of CityRovers rolled out from the Tata Motors stable inPune on September 16, 2003.

2004:-Tata Motors acquires the heavy vehicles unit of Daewoo Motors, South

KoreaTCS goes public in July 2004 in the largest private sector initial public offering(IPO) in the Indian market, raising nearly $1.2 billion.

2005:-Tata Steel acquires Singapore-based steel company NatSteel bysubscribing to 100 per cent equity of its subsidiary, NatSteel AsiaVSNL* acquired Tyco Global Network, making it one of the world's largestproviders of submarine cable bandwidthTata Sons completes 60 years of Tata operations in the USThe Taj takes over management of The Pierre, NY

Taco acquires Wundsch Weidinger, GermanyTrent acquires majority stake in India's largest, privately owned books andmusic retailer, LandmarkTata Steel acquires stake in Carborough Down Coal Project, Queensland, and

AustraliaVSNL* acquires Teleglobe International Holdings, BermudaTCS acquires Sydney-based Financial Network Services (FNS)

Tata Motors passenger vehicle sales cross one-million markTCS acquires leading BPO firm Comicrom in ChileThe Indian Hotels Company acquires hotel run by Starwood, SydneyTata Steel acquires Millennium Steel, Thailand

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Tata Chemicals acquires controlling stake in Brunner Mond Group, UK.

2006:-Tata Credit Card launchedFoundation stone for the Tata Medical Centre unveiled in KolkataTCS launches Indias largest e-governance initiative, MCA-21Tata Steel ranked worlds best steel maker for the third time by World SteelDynamics

Tata Coffee acquires US-based Eight Oclock CoffeeTatas join hands with Indigene Pharmaceuticals to build a globalbiopharmaceutical companyTata Sky satellite television service launched across the countryTata Steel begins construction of R670 million Ferrochrome plant in South

AfricaTata Group acquires 30-per cent stake in GlacauVSNL* rebrands SNO as Neotel in South Africa

2007:-Tata Refractories sets up Greenfield plant in ChinaTata Research Design and Development Centre celebrates silver jubileeTata Steel acquires CorusTCS inaugurates TCS China a joint venture with Chinese government andother partnersTata Steel acquires Rawmet Industries in OrissaTata Steel, through its subsidiary NatSteel Asia, acquires controlling equitystake in two rolling mills located in VietnamTata Motors rolls out its 100,000th Ace within 20 months of the vehicle's initiallaunch

Indian Hotels acquires Campton Place Hotel in San FranciscoTata Tea subsidiary, the Tetley group, signs an agreement to acquire theVitax and Flosana trademarks in Poland, from Premium Foods.VSNL*, through Neotel, acquires Transtel Telecoms, South AfricaTCS sets up its first global delivery centre at Guadalajara in MexicoVSNL* rolls out wi-max services in India

Tata Tea takes the No 1 position in terms of volume share in India in thepacket tea segmentTata Motors is listed on the world's largest bourse, the New York StockExchange, the second Group Company to do so after VSNL

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Tata Steel celebrates its centenary on August 26, 2007Tata Teleservices crosses the 1-million subscriber mark in KolkataTata Teleservices unveils the country's first full-fledged web-browser formobile phonesTata Teleservices' subscriber base crosses the 20-million markwww.autojunction.in introduces auto e-retailing for the first time in India

Tata Motors rolls out the one-millionth passenger car off the Indica platformComputational Research Laboratories, a division of Tata Sons, develops Eka,the fourth fastest supercomputer in the world and the fastest supercomputer in

AsiaVSNL* is renamed as Tata Communications

2008:-Tata Motors unveils Tata Nano, the Peoples Car, at the 9th Auto Expoin Delhi on January 10, 2008Tata Projects acquires a majority stake of 75 per cent in Artson Engineering

Tata Steel performs the groundbreaking ceremony for expanding itsJamshedpur capacity to 10 million tonne annuallyIndian Hotels' Taj Leisure Hotels launches Taj Tashi at Thimphu, BhutanTata Tea forays into the out-of-home beverage segment by unveiling its firstoutlet, Chai Unchai, at BangaloreTata Sons unveils the Tata logo at the Nanjing Tata Auto Comp Systems plantin ChinaTata Sons announces the launch of Tata International SocialEntrepreneurship Scheme for an international student internship programmewith the Groups community initiatives in India

Indian Hotels Company invests 36 to 37 per cent in a newly floated company,BJETS, in partnership with Singapore-based Briley GroupTata Advanced Systems signs an MoU with Sikorsky Aircraft to manufactureS-92 helicopter cabins in IndiaTata Advanced Systems signs an MoU with Israel Aerospace Industries toestablish a joint venture company in India to manufacture and support a widerange of defence and aerospace products

Tata Securities, the wholly owned subsidiary of Tata Capital, announces itsentry into the retail and institutional broking segment

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Tata Communications, integrating the former VSNL and Teleglobe brands, islaunched worldwide

TRF launches Indias first mobile stone crusher and screening plantTelco Construction Equipment Company acquires a 79-per cent controllingstake in Spain-based Serviplem SAE2E SerWiz Solutions is renamed as Tata Business Support Services Limited

TCS announces the opening of its North America delivery centre called TCSSeven Hills ParkTata Motors enters into a definitive agreement with the Ford Motor Companyfor the purchase of Jaguar Land RoverINCAT enters into a joint venture with Hindustan Aeronautics Limited (HAL) tocreate INCAT-HAL AerostructuresTata Teleservices (Maharashtra) crosses the 5-million subscribers markduring the month of MarchTata Chemicals successfully completes the acquisition of General Chemical

Industrial Products Inc in the USATata Coffee launches its first retail standalone outlet, Mr Bean CoffeeJunction, in the countryTata Central Archives inaugurates its new website

HISTORY OF AIGAmerican International Group, Inc. (AIG) (NYSE:AIG) is a major Americaninsurance corporation based in Wall Street in New York City. The UK

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headquarters are located on Fenchurch Street in London, England. UK,European operations are based in La Defense, Paris and its Asian HQ is inHong Kong.

According to the 2008 Forbes Global 2000 list, AIG is the 18th-largestcompany in the world. It became a component of the Dow Jones Industrial

Average on April 8, 2004. As of March 16, 2007, AIG Investments, a division

of AIG, completed the purchase of 100% of the stock of P&O Ports NorthAmerica from Dubai-based DP World.

AIG is the world's leading international insurance and financial servicesorganization, with operations in more than 130 countries and jurisdictions.

AIG member companies serve commercial, institutional and individualcustomers through the most extensive worldwide property-casualty and lifeinsurance networks of any insurer. In the United States, AIG companies arethe largest underwriters of commercial and industrial insurance and AIG

American General is a top-ranked life insurer.

AIG's global businesses also include financial services, retirement servicesand asset management. AIG's financial service businesses include aircraftleasing, financial products, trading, market making and financial advice. AIG'sgrowing global consumer finance business is led in the United States by

American General Finance.

AIG also owns several of the largest U.S. retirement services businesses

through AIG Retirement and AIG Sun America, and the largest network ofindependent broker-dealers through AIG Advisor Group; through thesesubsidiaries AIG runs asset management for the individual and institutionalmarkets, with specialized investment management capabilities in equities,fixed income, alternative investments and real estate

AIG's common stock is listed on the New York Stock Exchange (NYSE:AIG,as well as stock exchanges in Japan and Ireland (TYO: 8685; ISEQ:AIN). [4]

AIG is also the principal sponsor of English football team Manchester Unitedand the Japan Open Tennis Championships

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The worlds leading international insurance and financial services organization Operations in more than 130 countries and jurisdictions AIG member companies serve commercial, institutional and individual

customers through the most extensive worldwide property-casualtyand life insurance networks of any insurer

AIGs successful and growing global businesses also include financialservices, retirement services and asset management.

1-Property2-Casualty3-Marine4-Life5-Financial Services6-Asset Management

AIG IN INDIA

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AIG India, the Indian arm of AIG, established its presence in India in 1994.AIG entered India in 1945, prior to nationalization of the insurance sector, andhad offices n several Indian cities. On opening up of the insurance sector toprivate insurance company's in2000, AIG and the Tata Group formed a Jointventure, Tata AIG.

AIG and its affiliate funds have invested approximately $450 m in private

equity in India. These direct investments have been made intelecommunication.

And toll roads & bridges in the e infrastructure sector. Besides, investmentshave also been made in the manufacturing, technology, pharmaceuticals andretailing sector. AIG continues to look with interest for made direct investmentopportunities in these sectors and in new emerging sectors like biotechnology,IT-enabled services etc

Since 2001, AIG has built a strong insurance organization in the country, with1,135 employees and over 36,000 agents (January31, 2006).Apart frominsurance, AIG Companies also manage investment funds that have investedsome $425m in Indian companies .AIG recently established a softwarecompany in India - AIG Systems Solutions (AIGSS

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1. Assets are insured, because they are likely to be destroyed, throughaccidental occurrences. Such possible occurrences are called perils. Fire,floods, breakdowns, lightning, earthquakes, etc, are perils. If such perils cab

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case damage it the asset, we say that the asset is exposed to that risk. Perilsare the events. Risks are the consequential losses or damages. The risk to anowner of a building, because of the peril of an earthquake, may be a few lakhsor a few crores of rupees, depending on the cost of the building and thecontents in it.

2. The risk only means that there is a possibility of loss or damage. The

damage may or may not happen. Insurance is done against the contingencethat it may happen. There has to be an uncertainty about the risk. Insurance isrelevant only if there are uncertainties. If there is no uncertainty about theoccurrence of an event, it cannot be insured against. In the case of a humanbeing, death is certain, but the time of death is uncertain. In the case of aperson who is terminally ill, the time of earth is not uncertain, though notexactly known. He cannot be insured.

3. Insurance does not protect the asset. It does not prevent its loss due to theperil. The peril cannot be avoided through insurance. The peril can sometimesbe avoided, through better safety and damage control management.Insurance only tries to reduce the impact of the risk on the owner of the assetand those who depend on that asset. It only compensates the losses- and thattoo, not fully.

4. Only economic consequences can be insured. If the loss is not financial,insurance may not be possible. Examples of non-economic losses are loveand affection of parents, leadership of managers, sentimental attachments tofamily heirlooms, innovative and creative abilities, etc5. The mechanism of

insurance is very simple. People who are exposed to the same risks cometogether and agree that, if any one of them suffers a loss, the others will sharethe loss and make good to the person who lost. All people who send goods byship are exposed to these risks, which are related to water damage, shipsinking, piracy, etc. Those owning factors are not exposed to these risks, butthey are exposed to different kinds of risks like, fire, hailstorms, earthquakes,

lightning, burglary, etc. Like this, different kinds of risks can be identified andseparate groups made, including those exposed to such risks. By this method,the heavy loss that any one of them may suffer (all of them may such losses

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at the same time) is divided into bearable small losses by all. In other words,the risk is spread among the community and the likely big impact on one isreduced to smaller manageable impacts on all.

6. If a Jumbo Jet with more than 350 passenger's crashes, the loss would runinto crores of rupees. No airline would be able to bear such a loss. It isunlikely that many Jumbo Jets will crash at the same time. If 100 airline

companies flying Jumbo Jets, come together into an insurance pool,whenever one of the Jumbo Jets in the pool crashes, the loss to be borne byeach airline would come down to a few lakhs of rupees. Thus, insurance is abusiness of "haring".

7. There are certain principles, which make it possible for insurance to remaina fair arrangement. The first is that it is difficult for any one individual to bearthe consequences of the risks that he is exposed to. It will become bearablewhen the community shares the burden. The second is that the peril shouldoccur in an accidental manner. Nobody should be in a position to make therisk happen. In other words, none in the group should set fire to his assets andask others to share the costs of damage. This would be taking unfairadvantage of an arrangement put into place to protect people from the risksthey are exposed to. The occurrence has to be random, accidental, and notthe deliberate creation of the insured person.

Insurance as a security Tools

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The United Nations Declaration of human Rights 1948 provides that"Everyone has a right to a standard of living adequate for the health andwellbeing of himself and his family, including food, clothing, housing andmedical care and necessary social services and the right to security the eventof unemployment, sickness, disability, widowhood or other lack of livelihood incircumstances beyond the control."

When the bread winner dies, to that extent, the family's income dies. Theeconomic condition of the family is affected, unless other arrangements comeinto being to restore the situation. Life insurance provides if this did nothappen, another family would be pushed into the lower strata creates a coston society.

The lower strata create a cost on society. Poor people cost the nation by wayof subsidies and doles and so on. Poor people also cost by way of largergrowth in population, poor education and vagaries in behavior of children. Lifeinsurance tends to reduce such costs. In this sense life insurance business iscomplementary to the state's efforts in social management.

Under a socialistic system the responsibility of full security would be placedupon the state to find resources for providing social security. In the capitalisticsociety, provisions of security are largely left to the individuals. The societyprovides instruments, which can be used in security this aim. Insurance is oneof them. In a capitalistic society too, there is a tendency to provide somesocial security by the state under some schemes, where members arerequired to contribute e.g. Social Security Schemes in U.K.

In India, social security finds a place in our constitution. Article 41 requiresstate, within the limits of its economic capacity and development, to makeeffective provisions for security right to work, to education and to providepublic assistance incase of unemployment, old age, sickness, anddisablement and in other cases of undeserved want. Part of the state'sobligations to the poorer sections is met through the mechanism of lifeinsurance

Life Insurance V/s Other Savings

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Contract of Insurance:

A contract of insurance is a contract of utmost good faith technically known asuberrima fides. The doctrine of disclosing all material facts is embodied in thisimportant principle, which applies to all forms of insurance.

At the time of taking a policy, policyholder should ensure that all questions inthe proposal form are correctly answered. Any misrepresentation, non-

disclosure or fraud in any document leading to the acceptance of the riskwould render the insurance contract null and void.

Protection:Savings through life insurance guarantee full protection against risk of deathof the saver. Also, in case of demise, life insurance assures payment of theentire amount assured (with bonuses wherever applicable) whereas in othersavings schemes, only the amount saved (with interest) is payable

Aid to Thrift:

Life insurance encourages 'thrift'. It allows long-term savings since paymentscan be made effortlessly because of the 'easy installment' facility built into thescheme. (Premium payment for insurance is either monthly, quarterly, halfyearly or yearly).For example: The Salary Saving Scheme popularly known as SSS provides aconvenient method of paying premium each month by deduction from one'ssalary.In this case the employer directly pays the deducted premium to LIC. TheSalary Saving Scheme is ideal for any institution or establishment subject to

specified terms and conditions.

Liquidity:In case of insurance, it is easy to acquire loans on the sole security of anypolicy that has acquired loan value. Besides, a life insurance policy is alsogenerally accepted as security, even for a commercial loan.

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Tax Relief:Life Insurance is the best way to enjoy tax deductions on income tax andwealth tax. This is available for amounts paid by way of premium for lifeinsurance subject to income tax rates in force.

Assesses can also avail of provisions in the law for tax relief. In such casesthe assured in effect pays a lower premium for insurance than otherwise.

Money When You Need It:

A policy that has a suitable insurance plan or a combination of different planscan be effectively used to meet certain monetary needs that may arise fromtime-to-time.Children's education, start-in-life or marriage provision or even periodicalneeds for cash over a stretch of time can be less stressful with the help ofthese policies.

Alternatively, policy money can be made available at the time of one'sretirement from service and used for any specific purpose, such as, purchaseof a house or for other investments. Also, loans are granted to policyholdersfor house building or for purchase of flats (subject to certain conditions).

About traditional plans

Traditional life insurance plans are usually referred to as plans of insurance.These plans have two basic elements. One is the death cover providing forthe benefit being paid on the death of the insured person within a specified

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period. The other survival benefit providing for the benefit paid on survival ofspecified period.

All traditional plans are combination of these two basic plan.

1- TERM ASSURANCE PLAN:-Plans of insurance that provides only death cover are called TREM

ASSURANCE PLAN. If the insured does not die with in the specifiedperiod, no payment is made under a term assurance plan, but if the insureddie with in the specified period company will pay death claim.

2- PURE ENDOWMENT PLAN:-Those are provides only survival benefit are called PURE ENDOWMENTPLAN. If the insured does not die within the specified period, thencompany will pay sum assured+bonus,but if the insured die with in the specified period company will pay death

claim.

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Some Traditional Plans Or Term Plans Of Tata AIG

RAKSHA(Pure Protection Plan)

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Target audience:-

Aged between 18 and 50 year Wanting to there loved ones from the financial consequence of an

unfortunate event

Wanting to option of a flexible and convertible plan, should they want toinclude a savings element in it?

Product features:-

Raksha is a Tata AIG lifes cast effective plan. It helps provides financialprotection to the family. In case of death of insured, the sum assured is paid tothe nominees.

1- Four term to choose from: Raksha is available in 4 terms- 10, 15, 20,and 25

2- Convertibility: This plan has an option to include a saving element into it.I can be converted into any of Tata AIG lifes select endowment plan.

Product snapshot:

Term Raksha-10 Raksha-15 Raksha-20 Raksha-25

Entry age 18-50 18-45 18-40 18-35

Minimum

Sum assured

Rs. 500,000 Rs. 500,000 Rs. 500,000 Rs. 500,000

Minimumannualpremium

Rs.2,000 Rs.2,000 Rs.2,000 Rs.2,000

Payment mode: MONTHLY, QUATERLY, SEMI ANNUAL, ANNUALGuaranteedbenefit: sum assured payable on death

RIDERS

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RIDERS are very cost effective method to enhance the cover of a basicpolicy.

A riders is normally operational for the of the basic policy or lesser butnever more then the basic policy term

When the basic policy is cancelled, the riders are also cancelled.

Rider do not pay maturity benefits

The riders amount is called the Riders sum assured. Rider premiums are charged separately (not through cancellation of

units). Premium payment method will be as per the basic policy.

Riders continue while the policy is on PH. Rider premiums must be paidto keep the riders in force during PH.

Existing policyholders can attach riders on policy anniversary.

Riders provide 5 additional benefits to the policy holder:-

Accidental Death Benefit(ADB) Accidental & Death & Dismemberment (ADD)(Long Scale) Critical Illness (lumpsum benefit) Waiver of Premium Payor Benefit Term rider

Accidental Death Benefit (ADB)(Increase your risk protection at a very minimal cost)

In case of accidental death, the benefits payable are: Basic SA(less cumulative partial withdrawals) or Fund Value, whichever ishigher PLUS the ADB Sum Assured

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Accidental Death & Dismemberment (ADDL)

In case of death resulting from an accident the benefits payableare: Basic SA (less cumulative partial withdrawals) or Fund Value,whichever is higher PLUS ADDL Sum Assured

In case of disability the ADDL SA will depend on the degree ofloss suffered.

Note- ADB and ADDL cannot be added together

Double Indemnity In case of death occurs due to accident while traveling as a fare

paying passenger: Double the Rider Sum Assured

Critical Illness (CI)

Rider SA payable under 6 critical Illnesses/Surgeries covered:-

1) Cancer2) Stroke3) Heart Attack4) Coronary Bypass Graft Surgery5) Kidney Failure6) Major Organ Transplant

Waiver of Premium

Helps cover disability of the insured

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If the insured is totally and permanently disabled, it is likely thathe will not be able to pay future premiums and policy maylaps.

The waiver of premiums (WOP) rider waivers of all the futureunpaid premiums if the insured is totally and permanentlydisabled.

Term rider

Providing additional death benefit ( pays lumpsum amount ondeath)

Policy term 5,10,15,20,25or until age 60 year The term rider can be lesser than or equal to the length of term

of the basic policy, but can never more than it. The term rider sum assured can be lesser than or equal to the

SA of the basic policy, but can never more than the SA of the

basic policy. The minimum sum assured for a term rider is Rs 1 lakh.

NIRVANA PLUS (Retirement Policy)

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Target audience:

Aged between 18 year and 45 year Wanting a lump sum and regular pension after retirement.

Product feature:Nirvana plus is Tata AIG lifes retirement plan. It helps you in ensuring acomfortable; hassle free life and independent retire life.1- Choose your retirement age: The plan lets you choose from amongst

three retirement ages 55,58and 60 year. You pay a premium during yourworking life, with a premium payment term of 15 year.

2- Guaranteed Additional: Guaranteed Addition of 2%* of the Sumassured in the First year and Guaranteed Addition of 10%* of SA every5 years through out the premium paying term. This helps your maturityvalue to grow.

3- Bonuses: Non- guaranteed reversionary bonuses are added from the

6th

policy anniversary onwards. A terminal bonus is added once thepolicy has been inforce for 10 year these bonuses helps money incompounding faster.

4-Additional benefit: The plan has a critical illness rider inbuilt for first 3year. If you get diagnosed with a covered critical illness and survive for aperiod of 30 days post diagnosis, an amount of Rs.100, 000 will be paid fortreatment.The plan also has an accidental death benefit inbuilt. In case of accidentaldeath, the nominee gets double sum assured the rider sum assured andbasic sum assured PUSS the accrued bonuses

5- Annuity PLUS lumpsum at maturity: On maturity the sum assured +Bonuses+guranteed additional help gives a large lumpsum .33% of thisamount can be commuted tax free for meeting urgent expenses. The balanceamount can be used to purchase an annuity of your choice for giving you lifelong pension payment.

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Product snapshot:

Entry age 18 year-40 year 18 year-43 year 18 year-45 year

Sum assured Rs.100,000 Rs.200,000 Rs.400,000

Minimum annualpremium

Rs.2000 Rs.2000 Rs.2000

Payment mode- YLY, HLY, QLY, MLYTax benefit u/s-80CCC & section 10(10D

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MAHALIFE GOLD (WholeLife Plan)

Target audience:1- Aged between 30 days and 60 years next birthday2- Required money at regular interval.

3- Wanting to create a legacy for future generation.4- Cover for life, but want to pay premium for a limited term.

Product feature & BenefitsMahalife gold is Tata AIG lifes premium whole life plan. It provides coveragetill age 100 and gives regular income for life. The coverage is available for apremium payment term of 15 year only. The plan only also allows the insuredto take advantage of higher market interest rates through cash dividend.Mahalife Gold ensures that you are secured with regular income available foryou through out your life. This can be used for taking care of your house holdexpenses / Loans / Retirement OR you can treat this as regular fundsavailable to you for a Systematic Investment which will give you furtherappreciation.You would have heard of Life Insurance Policies that give you cover till youretire and you got to pay for it till you retire. What if I give you a plan thatcovers you for your life time & you have to pay for only 15 years?This is a very unique Plan in which 3 generations of your family can benefit.When you take Mahalife Gold for your son, you get the benefit of Taxdeductions while your son enjoys guaranteed returns (survival benefit) through

out his life. On his death, the death cover will be passed on to yourGrandchildren

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1-Whole life cover: The plan provides coverage till age 100. In case of death

at any time, the full sum assured will be paid to the nominees.

2-Limited premium payment term: The insured has to pay premiums only

for 15 year

3-Yearly coupon payment:

a- From the 6th policy anniversary onwards, the insured start

getting non-guaranteed cash dividend, which depend on the

performance of the company.

b- From the 10th policy anniversary onwards, the insured gets

guaranteed annual coupon payment of 5% of the face value

4- Tax benefit u/s-80C and the payouts are tax free u/s 10(10D)

Product snapshot:

Entry age 0(30 days) to60 year

Minimum sum assured Rs.50, 0000

Maximum sum assured No limit

Payment mode YLY, HLY, QLY, MLY

Tax benefit u/s-80C and the payouts are tax free u/s 10(10D)

Unit Linked Insurance Plan53


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(ULIPs)

(Protection + Wealth Creation under a Single Plan

A policy, which provides for life insurance where the policy value at any timevaries according to the value of the underlying assets at the time. In anotherword we can say that a ULIP is a life insurance policy which provides a

combination of life insurance protection and investment. LIP is life insurancesolution that provides for the benefits of protection and flexibility in investment.The investment is denoted as units and is represented by the value that it hasattained called as Net Asset Value (NAV).

ULIP came into play in the 1960s and became very popular in WesternEurope and Americas. The reason that is attributed to the wide spreadpopularity of ULIP is because of the transparency and the flexibility which itoffers.

As times progressed the plans were also successfully mapped along with lifeinsurance need to retirement planning. In todays times, ULIP providessolutions for insurance planning, financial needs, financial planning forchildrens future and retirement planning

ULIP distinguishes itself through the multiple benefits that it provides tothe consumer. The plan is a one-stop solution providing:

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Life protection Investment and Savings Flexibility Adjustable Life Cover Investment Options Transparency Options to take additional cover against Death due to accident Disability Critical Illness Surgeries Liquidity Tax planning

Some of the other features offered by insurer along with ULIPs are thefollowing.

The policyholder can pay additional premium for investment at any time

Partial or total withdrawal is allowed. Sometimes there are conditions

attached. some de insurer, not all ,charge a redemption fee in such

cases

Theses policies will not be entitled to any bonus

There is no annual bonus ,but there may be a loyalty bonus paid at the

end

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HOW ULIPS MANAGES MONEYUnit linked insurance plan have become much sought after by individuals whowant to buy life insurance. ULIPs are different from traditional plan in thesense that they invest the premiums money in the market linked instrumentprimarily in stock, bonds, government securities.

ULIPs OPTION:-

Broadly speaking, most life insurance companies offer individuals 4 potion tochoose from..1-Aggressive / Growth fund2-Balanced fund3-Capital guaranteed fund4- Debt fund1-Aggressive / Growth fund:-

Such fund investment in major portion of the premium in the equity market.The Investment mandate, through largely the same, may differ slightly across

various life insurance companies. Some company invests 100% in equity

market, some company 80% in equity market.

2- Balanced fund:-

A balanced fund invests the premium money in a portfolio, which consists of

both equity as well as debt instrument in varying portfolios. Balanced fund areideal for individual who are apprehensive of taking

3-Capital guaranteed fund:-

A few insurance company also offer ULIPs with a capital guarantee the return

atleast the premium that have been paid over the policy is tenure should the

fund value fall lower than the premium paid capital guarantee.

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The safety of the capital guarantee stems from the fact that 70% of the

premium more money is invested in relatively safe debt instrument when

moderate the risk of investing in stocks but might lower potential returns.

4- Debt fund:-

These types of fund invest in debt instrument like government bond and AAA-

rated securities. Such fund are low risk in nature when company to their equity

/ balanced counterparts. The return through tend to be lower and steadier than

the equity balanced fund.

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Comparison Of Unit Link Insurance Plan And Whole Life Insurance

Talk to any insurance advisor and you are bound to be bombarded by hordesof different kinds of insurance policies. Is it any surprise that a normal persongets confused when choosing a right insurance policy for his needs? Advisors

take advantage of this buyer's ignorance and promote those policies that fetchthem the highest returns. Two such widely promoted types of insurancepolicies are unit link insurance plan and whole life insurance plan. Howeverthere are quite a few differences between these policies. We take a look athow both these policies differ

Unit link insurance plan: Unit link insurance plan or ULIP is the most widelypromoted type of insurance plan. When you pay a premium, you are given aninsurance cover and part of premium is invested in the fund of your choice. In

the initial years, a major part of the premium goes towards buying aninsurance cover and remaining portion is invested. Most unit link plans offerchoice of 3 funds: pure equity, balanced which contains a mixture of debt andequity in varied proportion and pure debt. Depending on your risk appetite aswell as market scenario, you can choose appropriate fund(s). You can alsoswitch between funds if the market condition or your personal circumstancechanges. However the drawback of unit link insurance plan is the highcharges. Also many advisors mis-sold these plans by telling that there is noneed to keep on paying the premium for the duration of the plan, just threeyears would suffice. Though conceptually this is correct, fund will keep on

debiting its charges from the amount invested. So if there is no sufficientamount in your account to pay these charges, your life cover will cease andyou'll have to buy a new policy

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Whole life insurance: A whole life insurance policy is an insurance policy thatprovides you with insurance cover for as long as you live or 100 years,whichever is earlier. This means when buying a whole life insurance you have

to keep on paying premiums till the end. Due to this drawback, this plan lostout to ULIP. To combat this Tata AIG has introduced its Mahalife Gold whereyou need to pay premiums just for 12 years while the life cover continues tillyour death. In addition, you start getting 5% of sum assured from sixth yearonwards along with bonuses accrued. Once 12 years are over, you can usethis money as pension for old age. However unlike ULIP, a whole lifeinsurance plan does not give you flexibility of investing as per your risk profile.

Also their charges are not transparent.

How it works

Assume a person needs 25 Lakhs for a comfortable retired life (afterinflation).

How much will he need to save?

InvestmentAmount

Years Expected Return-10%

Corpus- 10%Returns

Rs.11,000 30 10% Rs.25,072,57

Rs.19,000 25 10% Rs.25,419,91

Rs.33,000 20 10% Rs.25,267,99

Rs.60,000 15 10% Rs.25,075,45

Rs.1,25,000 10 10% Rs.25,819,00

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InvestmentAmount

Years Expected Return-6%

Corpus- 10%Returns

Rs.25,000 30 6% Rs.25,238,44

Rs.37,000 25 6% Rs.25,768,98

Rs.54,000 20 6% Rs.25,074,95

Rs.87,000 15 6% Rs.25,427,73

Rs.1,57,000 10 6% Rs.25,427,73

ADVANTAGE OF ULIPs

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1-ULIPS provide for flexibility.2- In ULIPS the insurance cover must be a minimum multiple of the premium3-ULIPS can not issued as participating policies4-Loan are not given under ULIPS5- ULIPs the premium is invested in a fund decided by the insurer.

6-The NET ASSETS VALUE (NAV) of all the funds of all the insurers will vary.7-In ULIPs, the premium will be invested as pre the offer price.8-In ULIPs, the offer bid spread is the difference between the two prices.9-In ULIPs, the offer bid spread, will in some cases be zero.10-In ULIPs, a policy holder can switch between funds at any time.11-In ULIPs, the premium to be invested in the fund can be increase in anyyear.12-In ULIPs, the NAV of a fund can be less than purchase price.13-In ULIPs, the SA must not be less than 1.25 times the single premium.

14-In ULIPs the SA must not be less than 5 times the annualized premium.15- In ULIPs the policy holder is responsible for the benefit under the policy.16- In ULIPs, the NAV are published regularly.17- In ULIPs one can be pay additional premium in any year for investment.18- In ULIPs, the lock in period will apply, if the additional premium is paid anyyear19- In ULIPs, riders can be availed of20- In ULIPs the rider will be based on the basic SA and not NAVs21-In ULIPs, the death benefit will be the basic SA only22- In ULIPs, the death benefit may be integrated

23-In ULIPs, partial withdrawal are permitted periodically.24-ULIPs harness the Power of Compounding to grow the value of theinvestment.25-Compounding is Interest earned on Interest26-Interest that is earned by the initial capital also earns interest and hencemultiplying the rate at which money grow.

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SOME UNIT LINKED INSURANCE PLANS OFTATA AIG

1) Invest Assure II

Target audience:1- aged between 0(30days) and 60 years2- Wanting to create wealth for a future event

Product feature:Invest assure II is a unit linked endowment plan from Tata AIG life. This is aplan that lets you harness the market to create wealth over a long term.

1- Policy term: this plan lets you select from three policy term according tothe investment horizon1-15 year2-20 year3-30 year

2-Five funds: This plan offers 5 different types of funds, which cater to therisk averse as well as those willing to take risks for a chance of greater returns

1- Equity fund2- Aggressive growth fund3- Stable growth fund4- Income fund5- Short term fixed income fund

3-Fund switching: This plan lets you switch from one fund to another.Switching fund means moving money from one fund to another fund. Thereare 4 free fund switching allowed in a policy year

4-Partial withdrawal: This policy allow to partial withdrawal a part of yourfund value to meet urgent expenses. This is allowed only at least 3 annual

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premiums have been paid. The minimum amount of patria withdrawal is Rs10,000.

5- Premiums holidays: in case you find that you are unable to pay premiums,you can put the policy on premiums holidays after paying at least 3 annualpremiums. The policy does not lapse and continued to grow to market

conditions. You can resume paying the premiums at the later date. Premiumsholidays can continue for a maximum of 5 years at a stretch.

6-Top-up: You can invest additional amount of money via top-up. This helpthe fund value go faster. You can increase insurance coverage via top-up. Ifthe top-up exceed 25% of the total premiums paid, it is mandatory to take atop-up from the amount that exceeds 25%. The premiums top-up is Rs25,000. Top-up can be made up to 4 times a year. The minimum sum assured

multiple for top-up is 1.25 and the maximum is 5.

7- Death benefit: In case of death of insured the death benefit payable is asfollows:a- Higher of the sum assured less deductible partial withdrawal or regular

premium fund value.b- In additional to this higher of top-up sum assured less deductible partial

withdrawal or top-up fund value, if any will also be paid

c- Deductible partial withdrawal are higher ofI- Partial withdrawal made 24 month preceding death and

II- All partial withdrawal made after attaining age 60.

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Product snapshot:

Term 15 year term 20 year term 30 year term

Entry age 0(30days)-60 0(30days)-55 0(30days)-45

Maximummaturity age

75 75 75

Minimum annualpremium

Rs.12,000 Rs.12,000 Rs.12,000

Paymentmode- YLY, HLY, QLY, MLY Tax benefit u/s-80C and the payouts are tax free u/s 10(10D)

2) Invest Assure Gold64


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(Whole Life Unit Linked Plan)

Target audience:

Aged between 0(30 days) and 70 year Wanting to create wealth for future generation.

Product feature:Invest assure gold is a unit linked whole of life plan from Tata AIG life. This isa plan that lets you harness the market to create wealth over a long term.1-premium payment term:

A. 5 year premiums payment termB. Whole of life premiums payment term

2- 5 funds: This plan offers 5 different types of funds, which cater to therisk averse as well as those willing to take risks for a chance of greater returns

1- Mid cap Equity fund2- Aggressive growth fund3- Stable growth fund4- Income fund5- Short term fixed income fund

3-Fund Switching: This plan lets you switch from another. Switching fundmeans moving money from one fund to another fund. There are 4 free fundswitching allowed in a policy year

4- Partial withdrawal: This policy allow to partial withdrawal a part of yourfund value to meet urgent expenses. This is allowed only at least 3 annualpremiums have been paid. The minimum amount of patria withdrawal is Rs10,000.

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5- Premiums holidays: In case you find that you are unable to pay premiums,you can put the policy on premiums holidays after paying atleast 3 annualpremiums. The policy does not lapse and continued to grow to marketconditions. You can resume paying the premiums within 2 years. The chargefor premium holiday would be 4% of regular premiums and this charge willcontinue for Premium payment term or the 5th policy anniversary only.

6- Top-up: Top-up: You can invest additional amount of money via top-up.This help the fund value go faster. You can increase insurance coverage viatop-up. If the top-up exceed 25% of the total premiums paid, it is mandatory totake a top-up from the amount that exceeds 25%. The premiums top-up is Rs25,000. Top-up can be made up to 4 times a year. The minimum sum assuredmultiple for top-up is 1.25 and the maximum is 5.

7-Death benefit: In case of death of insured the death benefit payable is asfollows:

a- Higher of the sum assured less deductible partial withdrawal or regularpremium fund value.b- In additional to this higher of top-up sum assured less deductible partial

withdrawal or top-up fund value, if any will also be paidc- Deductible partial withdrawal are higher of

I- Partial withdrawal made 24 month preceding death andII- All partial withdrawal made after attaining age 60.

8-Guaranteed additional: After every 5 policy year, additional units know asloyalty additional will be allocated to the policyholder, provides the policy is

inforce at the time. Units would be equivalent to 0.25% of units under theregular premiums account.

9- Settlement option: On maturity, the maturity can be taken in period oftime.

I. This period over which the settlement is selected is called theSETTEMENT PERIOD.

II. The settlement period should not be exceed 5year from the maturity date.III- The value of these payments will depend on the performance of the

chosen fund.

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Product snapshot:

Entry age 0(30 days)70 year

Minimum sum Assured 1-5*Annual premium,2-(70 age at entry)*(0.5)*

Annual premiums

Minimum premium Rs. 50,000

Payment mode YLY, HLY, QLY, MLY

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INVEST ASSURE PLUS (Unit linked insurance plan)

Target audience:

Aged between 0(30days) and 70 year. Wanting tax benefit and a life cover

Wanting to create wealth for future generation

Product feature:Invest assure plus is Tata AIG lifes single premium unit linked insurance plan.It helps you harness the power of the market with the convenience of onesingle premiums payment.

1- Single premium: This policy require you to pay premium only and you

get coverage for the entire chosen policy term2- 4 policy term: This plan lets you choose from the amongst 4 term-15,

20, 25.30, depending on your investment horizon.3-Partial withdrawal: This policy allow to partial withdrawal a part of your

fund value to meet urgent expenses. This is allowed only at least 3 annualpremiums have been paid. The minimum amount of patria withdrawal is Rs10,000 and the fund value after such withdrawal should be atleast Rs.10, 000.

4-Top-up: You can invest additional amount of money via top-up. You caninvest windfall gains to help your fund has not had a chance to grow when anunfortunate event happens.

5-Sum assured: This plan gives you a life insurance cover for the chosenterm. This acts as a guarantee in case of death, if your fund has not had achance to grow when an unfortunate event happens.

6-Top-up sum assured: you can use top-up to increase your level ofcoverage. You can take a top up sum assured for the top up made. The sumassured is mandatory if the cumulative top up premium exceeds 25% of thesingle premium, for the amount that exceeds 25%.

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7- Death benefits: The death benefit payable will be the initial sumassured (ISA) less cumulative Net partial withdrawal or the single premiumaccount value (AV), whichever is higherWhen partial withdrawals have been made the sum assured will be reducedby HIGHER of:a- Partial withdrawal made 2 years preceding date of death of insured orb- Partial withdrawal made after attainment age 60 of the policyholder

8-5 fund: This plan offers 5 different types of funds, which cater to therisk averse as well as those willing to take risks for a chance of greaterreturns

1- Equity fund2- Aggressive growth fund3- Stable growth fund4- Income fund5- Short term fixed income fund

9-Fund Switching: This plan lets you switch from one fund to another.

Switching fund means moving money from one fund to another fund. Thereare 4 free fund switching allowed in a policy year

Product snapshot:

Term 15 year 20 year 25 year 30 year

Entry age - 0- 60 year 0- 55 year 0- 50 year 0- 45year

Sum assured -1.25 times the premium 25 times the premium

Minimum - Rs. 25,000 Premium

Payment made Single premium

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Invest Assure Flexi(Unit linked insurance plan)

Target audience:

Aged between 0(30days) and 70 year.

Wanting tax benefit and a life cover Wanting to create wealth for future generation

Product feature:

Invest assure gold is a unit linked whole of life plan from Tata AIG life. This isa plan that lets you harness the market to create wealth over a long term.Policy Term:Choose any term between 5 & 40

1-Payment Term:Choose 3 years, multiples of 5 years or the policy term2-Investment Funds:Choose from 7 different funds1- Equity fund2- Aggressive growth fund3- Stable growth fund4- Income fund5- Short term fixed income fund

3-Top-ups: You can invest additional amount of money via top-up. You caninvest windfall gains to help your fund has not had a chance to grow when anunfortunate event happens. Min single top up premium is Rs 5000/- and will

be allowed a four times a year.4-Top-up sum assured: you can use top-up to increase your level ofcoverage. You can take a top up sum assured for the top up made. The sumassured is mandatory if the cumulative top up premium exceeds 25% of thesingle premium, for the amount that exceeds 25%.5-Switching: This plan lets you switch from one fund to another. Switchingfund means moving money from one fund to another fund. Choose to switchyour funds at any time. 12 times a year with no charge.

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6-Settlement option: On maturity, the maturity can be taken in period of time.I. This period over which the settlement is selected is called the

SETTEMENT PERIOD.II. The settlement period should not be exceed 5year from the maturity date.III- The value of these payments will depend on the performance of the

chosen fund.IV- During the period, the death benefit will be the FUND VALUE.

7-Premium Redirection: Choose to redirect your future premiums to anyother funds in any proportion!

Product snapshot:

Policy term 5-40 year

Minimum issue age 0(30 days)

Maximum issue age 70 year

Maximum age of maturity 80 year

Minimum premium 15,ooo

Sum assured 5 x Annual Premium or Term/2 xAnnual Premium whichever is higher

Premium mode Annual/Semi-annual/Quarterly/MonthlyPremium Payment Period 3 Years/ Multiples of 5 Years/ Equal to

policy term

Benefit Period For the entire term of policy.

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SURVEY

As a part of our project, in order to know the perceptions of the investorsabout the in

Documents

A Project Report on Tata Aig