==Objective==
* To perform sensitivity analysis and qualitatively quantitatively determine the variation in the monthly premium charged by the various life insurance companies.* To understand Life Insurance life insurance companies' behavior towards different segments, which are based on gender and health groups.
==Methodology==
We have divided our The analysis broadly into 3 was divided in three parts:
'''Overview of Life Insurance'''<br>
We first studied the basics A basic understanding of the Life Insurance industry was developed through secondary resources like websites on the internet, journals etc. as to understand This answered question like what is life insurance, why people should go for it, what various types of life insurance are available and how segmentation is done in the Life Insurance industry. We covered the The Term Life Insurance was analyzed in detaile detail because people over 60 years of age, which was our the focus area in for this study, generally opt for this insurancetype.<br>
'''Premium Calculation using online Premium Calculator'''<br>
We determined the The premium charged by the following life insurance companies were determined using online premium calculators:
We considered cases for The analysis was carried out both for men and women. The test cases were chosen with the following attributes:
:* For men height and weight assigned were 5’8’’ and 176 lbs respectively while for women height and weight assigned were 5’4’’ and 162 lbs respectively.
:* Date of Birth was taken as 3rd March, 1949 (more than 60 yrs), coverage amount as $250,000, the guaranteed term as 15 years and state as California both for male and female.
:* Premiums were calculated considering various health conditions as blood pressure, cholesterol, cardiac problems or cancer in the family, medical advice or treatment for major illness etc. <br>
''Source: http://intelliquote.com''
'''Sensitivity Analysis'''<br>
Finally we analyzed The sensetivity analysis was used to understand the companies' response to different health conditions on the basis of the variation in the premium amount. From TO enable this we also determined , the key health parameters which were also determined since they have a major impact on the premium charged.
==Assumptions==
* Height and weight for both men and women considered are test cases were obtained from the median height and weight prevailing in USA.
* Coverage amount was based on the median annual household income of USA taken as $50,000 and Term duration assumed to be 15 years.
''Source: http://en.wikipedia.org/wiki/Life_insurance''
===Why should people go for Life Insurance Policy===
* To make sure their family will be well taken care of if they die.
* To minimize tax burden and to ensure whatever they have earned goes to their heirs as since it is a tax free way to transfer their wealth.
* The value for the policyholder is derived, not from an actual claim event, rather it is the value derived from the 'peace of mind' experienced by the policyholder, due to the negating of adverse financial consequences caused by the death of the Life Assured.
* Some insurance policies like Universal life insurance, whole life insurance and some term life insurance can be settled for cash value, the value that can be borrowed against or cashed in when the owner needs money.
===Types of Life Insurance===
Broadly , Life Insurance is divided into Temporary Life Insurance and Permanent Life Insurance. These can be further sub -classified. Various life insurance policies prevailing in United States are:
[[Image:types.jpg|thumb|center|600px|[http://www.metlife.com/individual/insurance/life-insurance/index.html#overview Source: metlife.com]]]
* In AIG, monthly premium for women who smoke more than 1 pack of cigarettes a day in the Best health class is $219 which increases by 34% to $294 for all other health classes.<br>
==Key FindingsPoints to note==
* The first level of segmentation in Life Insurance industry is on the basis of Age and Gender. Then they are further segmented on the basis of their health class and thereafter on the basis of their smoking habits.