IMPACT OF GLOBAL MELTDOWN ON BAJAJ ALLAINZ GENERAL INSURANCE

1.1 objective of research

This paper which serves as a market intelligence piece provides a detailed background on the Indian non-life insurance sector. In addition to analysing the key components driving todays market conditions, the report takes account of changes occurred within the regulatory environment in the previous year. A changed environment: Higher funding coasts Decline in equity met Increased met volatility Moderation in risk appetite Current credit cycle accelerated by changed environment The main objective of the research is to find out impact of global meltdown 2008 on general insurance sector. Nowadays all insurance companies are trying to establish themselves in competitive market. They are introducing market strategies to survive in mkt. many other private companies are looking to enter in Indian insurance market. To find out market potentiality of Bajaj during recession Main competitors of Bajaj Targeting right and potential customers How Bajaj is Different from other companies

1.2 Methodologies
The information upon which this report is based has been derived from a wide range of both primary and secondary sources. Most of the facts and figures originate from extensive desk research of an array of publicly available information. Research is basically based on primary data. Secondary data can be used only for the references. research has been done by primary data collection. and primary data has been collected by meeting with people in batala. Data collection has been done through by giving structural questionnaire. Though study will be based on sampling. This is an exploratory type of research. The study was based at measuring the effect of economic slowdown on general insurance sector. this survey was done on hundred general residents of selected region. Methods adopted 4 surveys Field survey method Personal interview technique Secondary sources viz company database The data collected are represented into suitable tabular forms for drawing inferences. Quantitative technique like averages, percentage, range, two way table, chi square test, analysis are applied as per the requirement. The level of preference, perception of customer about the product and customers were identified by means of scoring schemes.4 the representation of data various charts and graphs are used as per the requirement.

1.3 Limitations of the study

Time limitations Limited resources

 Research has been done only in jal Respondents error Possibility of error in data collection Possibility of error In analysis of data due to small sample size Companies did not disclose their secret data and analysis

Impact of recession on Bajaj

Bajaj sales down 8.1 percent
Bajaj Allianz , the countrys one of the largest insurance company , has reported 8.1 percent fall in its motorcycle sales last month. The company said in a statement Thursday that it sold 165,049 motorcycles last month as against 179,649 vehicles in May 2008. Cumulative sales, including exports and three wheelers, stood at 185,341 units, 8.02 percent down from 201,511 units sold in May 2008. Exports last month declined 2.5 percent to 58,682 units from 60,215 exported in the corresponding month last year. Exports have almost normalized after a dip in January-March 2009 and are expected to gradually exhibit positive year-on-year growth, the statement said. Overall sales during the first two months of the current fiscal declined 16.2 percent to 354,460 units, comparing to 423,354 units sold in April-May 2008.

Analysis:- this is news of the that period when recession was ruling the country. After may
2008 this change has occurred. Sales of two wheelers came down .Similarly sales of three wheelers decreased upto 8.02%.if we go with this news then we come to know that condition of bajaj stabilized after January 2009.
June 2009 193,202 167,945 168,471 24,731 67,726 June 2008 196,741 175,903 177,112 19,629 64,878 % CHANGE -2 -5 -5 26 4

TOTAL SALES MOTORBIKE SALES ALL TWO-WHEELER SALES THREE-WHEELER SALES EXPORTS

Bajaj Allianz General lays off 350 staff At the time of economic recession hitting company bajaj allianz which is said to be the second largest private sector non life insurance company of india, it is badly impacted by global

meltdown. Firstly the company had closed its bracches in mumbai and new delhi. But chief executive MR. Swaraj krishnan is not ready to accept this. He said they people had not closed their either of the branch. Beside this second largest insurance company made layoff of 350 workers also which is bigger comparative to last fiscal year. In this recession period the other loss which company had to face is tie up of HDFC bank with HDFC Ergo. Due to this now HDFC bank will not sell the products of bajaj allianz but CEO of bajaj said that HDFC will continue selling their products as per the aggrement. According to the reports truth is that bajaj had laid off those employees who were engaged in selling its products through HDFC bank.
Analysis:- this news explains us that the big company which is even considered to be the second largest general insurance comppany of our country is adverously affected by economic slowdown. It has made layoff of 350 staff members. Like other insurance companies it is also affected. From survey in my company, I got some important points regarding layoffs and retrenchment in Bajaj Allianz, jalandhar. Those members whose performance was less than 80% were retrenched in that branch. Before recession the birthdays of all staff members were celebrated from time to time but after global meltdown, this activity was not repeated back. As such things were considered cost increasing. Bajaj was having its two branches both near to one another but when recession hit the country, they merged their two branches into one just for the sake of cost cutting. It was resulted into layoffs and retrenchments in Bajaj beside different departments like financial and marketing departments were merged into one. so this merger of two branches of Bajaj proved big cost cutting measure at the time of economic slowdown. As far as agents are concerned, those who were considered to be A++, there was no change in their commissions. As it was sure that they will certainly bring policies for the company but as far as general agents are concerned, their commissions were also cut off.

Stock prices of bajaj during recession

It is known to everybody that share prices of Bajaj came down at the time of recession in economy . It gave heavy losses to share-holders.

Here we are having some graphs that show condition of insurance companies at the time of economic slowdown.

Recommendations to the company

Being the best product player in private sector, Bajaj needs improvement regarding the premium charges and advertisements to the target customers

Premium charges: - owing to its high premium charges customers perception about the
companys product has become that it is only for the upper middle class people. Whereas it does have some policy with low premium but the charges of allocation are too high. So we would like to suggest slowing down in premium charges to some extent by reducing administration charges and other charges

Advertisements:-. And selling of policies by agents in which they get high commission
customers are somewhere mislead and they know about very few products though Bajaj has very wide range of products. So it is recommend Bajaj to invest more in adv. In form of TV commercials, pamphlets and hoardings.

Wrong perception:- Bajaj is on the edge of filling bankruptcy. So it is also going to on the
brink of filling bankruptcy. But insurance In India is highly regulated industry. Any company that wants to setup an insurance business has to follow norms given by insurance regulatory and development authority (IRDA). So company should take positive measure to remove this wrong perception from the people.

Conclusions
The recession in the US market and the global meltdown termed as Global recession have engulfed complete world economy with a varying degree of recessional impact. World over the impact has diversified and its impact can be observed from the very fact of falling Stock market, recession in jobs availability and companies following downsizing in the existing available staff and cutting down of the perks and salary corrections. Globally the financial sector sacking the existing base of employees in high numbers in US the major example being CITI Group same still followed by others in hospitality industry Jet and Kingfisher Airlines too. The cut in salary for the pilots being 90 % can any one imagine such a huge cut in salary. Various steps taken by RBI to curb the present recession in the economy and counter act the prevailing situation. The sudden drying-up of capital inflows from the FDI which were invested in Indian stock markets for greater returns visualizing the Potential Higher Returns flying back is continuing to challenge liquidity management. At the heart of the current liquidity tightening is the balance of payments deficit, and this NRI deposit move should help in some small way. India is no different. New measures do not change our view on the growth outlook. In a vicious loop of reduced access to liquidity, slowing growth, and increased risk-aversion in the financial system. In total the recession have turned down the growth process and have set the minds of economists and others for finding out the real solution to sustain the economic growth and stability of the market which is desired for the smooth running of the economy. Complete business world is in doldrums situation and if this situation persists for a longer duration this may force small business enterprises to vanish as they have lower stability. To run smoothly they require continuous flow of liquidity which is dried out from the market. In present situation down fall in one sector one day leads to a negative impact on the other sector thus altogether everyone feel the impact of the Financial crises with the result of the current recession which

started in US and slowly and gradually due to linked global world have impacted everyone. Solution for the problem still remains at the top of the mind of every one, still everyone is facing the impact of recession but for "how long" is the major question which is of great importance. "When there is a will there is a way" thus goes an old saying. Hopefully the whole business world will realize this and will work on this sincerely. Only an honest and human approach is no more the requirement it has gone to the level of strategic decision for the future.