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LIC is the giant of the insurance sector. The overall size of LIC is much more thanthat of all private insurance companies. Private insurers are in expansion mode andare increasing their size but are still much behind LIC. Total premium deposits inLIC is much higher than the private insurance companies. Total premium of LIC inFY 07-08 was 149789 crores which three times more than that of private insurancecompanies.
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Income of LIC is much greater than private insurance companies. Last year totalincome from investments of LIC was 48244.14 crores which was nearly equal to thetotal income of the all private insurance companies. By this we can imagine how bigthe LIC is.
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Size of balance sheet of private insurance companies are lagging much behind LIC.Balance sheet of LIC is seven times bigger than that of private insurance companies.
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If we see the total number of policies issued by LIC and private insurance companies,we find that there is a huge gap between them. No doubt that LIC is a well establishedplayer in the field of insurance and many private companies have just started theirbusiness. Hence it is obvious that LIC is having large number of policyholders.
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Number of branches of private insurance companies is increasing as the new playersare entering in this market. Also the established players are in expansion phase andhence are expanding there business. There are many private insurance companies andhence there total number of branches has gone past LIC in the last financial year. Butoffices of private insurance companies are mostly in urban areas and still it is LICwhich covers most of the area.
Hence we see that LIC is leading when it comes to size. It is giant in insurancesector having huge network and customer base.
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We see that due to excellent service quality and attractive offers private insurancecompanies have started getting a number of customers. They are growing rapidly.Though LIC is also increasing its customer base but private insurance companies aremoving at a fast pace.
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Though the income of private insurance companies is negligible when compared withLIC but then also the pace with which they are increasing their income is tremendous.Private insurance companies are expanding their business and will certainly going togive a tough competition to LIC in the coming days.
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LIC is certainly having a large customer base. Private insurance companies are nothaving that much number of customer base but they are increasing it rapidly. Theyhave registered a decent growth of 104.64 % in number of new policies in the year2006-07. Last year also their growth rate was 67.4 %.
LIC, being the oldest player in the existing insurance market, has the biggest marketshare of 73.9 % which was 87.3% five years earlier. We see that private insurancecompanies are penetrating in the customer base of LIC.
Overall we can see that private insurance companies are giving a toughcompetition to the LIC and will certainly create a good business for themselvesin the coming days.
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There are many new entrants in this sector. There are many private insurancecompanies who have reported loss in this and previous years. This is the main reasonwhy private insurance companies lag behind LIC in case of business per branch.There is a big difference between them.
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Same is the case when it comes to income per branch. LIC is much ahead of privateinsurance companies in this field. They are undoubted champions in insurance when itcomes to profit earning.
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New business is increasingly going towards private insurance companies but still thecustomer base of LIC is very strong. In issuing new policies per branch also, they areahead of private insurance companies though not by very large margin.
Customer base of LIC is very strong and still business per branch, profit perbranch or premium per branch, they are leading much ahead of privateinsurance companies.
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LIC has not shown their good concern when the matter of grievance handling comes.Private insurance companies are far ahead in this matter. LIC has just resolved 25%cases in the last five years while private insurance companies have resolved nearly70% cases. This is a matter from where customer shift starts. We have seen the rapidincrease in customer base of private insurance companies which can be very muchaffected by this factor.
Overall we have seen that still LIC is very famous but private insurance companies aregrowing at exceptionally fast pace. Private companies show due concern in grievancemanagement and brings innovative schemes to attract the customers. Right now theyare giving good competition to LIC and very soon they will give very tough competitionto Life Corporation of India.
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