Leading private insurance company, Max New York Life has launched an insurance policy for the financially under-privileged people in the country.

The company is planning to sell the new policy called 'Max Vijay' to one crore people, accounting for 10 per cent of the current market.

The new policy differs with the conventional policies as people can buy a policy for as low as Rs 1,000 with an assured sum, equal to five times of the premium.

The policy can be purchased over the counter and will not lapse even if a premium is not paid on time that can be paid as Rs 10 per day.

Speaking to the reporters here today, Rajesh Sud, deputy managing director of Max New York Life said typically, this policy will be targeted at people who have uncertain incomes, who do not have ability to pay premiums at fixed duration and also the people who want to save but do not have access to do it.

Sud said the company will invest 95 per cent of the premium received from selling these policies in government securities, while five per cent will be invested in equities.

He said the company will be investing about Rs 500 crore in the new venture and has entered into a 10-year contract for technology with IBM worth USD 430 million.

IBM will provide technology solutions to the company and also supply it with hand-held terminals, which will be used to give receipts for the premium paid on the spot.

The policy will be sold through telecom companies, retail stores, microfinance institutions and NGOs, he added.