Comparative study of LIC of India & private Life Insurance companies in India.

Introduction:

The Indian life insurance industry has its own origin and history, since its inception. It has passed through many obstacles, hindrances to attain the present status. Insurance owes its existence to 17th century England. In fact, it took shape in 1688 at a rather interesting place called Lloyd's Coffee House in London, where merchants, ship-owners and underwriters met to discuss and transact business. The first stock companies to get into the business of insurance were chartered in England in 1720. The year 1735 saw the birth of the first insurance company in the American colonies in Charleston. In 1759, the Presbyterian Synod of Philadelphia sponsored the first life insurance corporation in America for the benefit of ministers and their dependents.
Life insurance in its modern form came to India from England in 1818 with the formation of Oriental Life Insurance Company (OLIC) in Kolkata mainly by Europeans to help widows of their kin. Later, due to persuasion by one of its directors (Shri Babu Muttyal Seal), Indians were also covered by the company. However, it was after 1840 that life insurance really took off in a big way. By1868, 285 companies were doing business of insurance in India. Earlier these companies were governed by Indian company Act 1866.
By 1870, 174 companies ceased to exist, when British Parliament enacted Insurance Act 1870. These companies however, insured European lives. Those Indians who were offered insurance cover were treated as sub-standard lives and were accepted with an extra premium of 15% to 20%. By the end of the 18th century, Lloyd's had brewed enough business to become one of the first modern insurance company.

Life is a roller coaster ride and is full of twists and turns. Insurance policies are a safeguard against the