MAJOR PROJECT REPORT & VIVA

On

“MARKETING STRATEGY FOR INSURANCE PRODUCT IN

DELHI NCR BY RELIANCE LIFE INSURANCE”

Submitted in the partial fulfillment of degree of

Bachelor of Business Administration (Banking and Insurance)

(2015- 2018)

Under the guidance of:

SHWETA GUPTA

SR. ASST. PROF, FIMT

Submitted by:
AMAN

Enrollment no. :
00690101715
BBA(G) 6THSemester

FAIRFIELD INSTITUTE OF MANAGEMENT AND

TECHNOLOGY, AFFILIATED TO GURU GOBIND SINGH
INDRAPRASTHA UNIVERSITY, KAPASERA, DELHI-110037

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 STUDENT DECLARATION

I hereby declare that the project entitled “MARKETING STRATEGY FOR

INSURANCE PRODUCT IN DELHI NCR BY RELIANCE LIFE INSURANCE’’
under the guidance of Dr. Shweta Gupta submitted in the partial fulfillment of
degree of Bachelor of Business Administration (G) from “Fairfield Institute of
Management and Technology, New Delhi”. This is my original work and this

project work has not formed the basis for the award of any Degree to the best
of my knowledge.

Student Name: AMAN

Enrollment no: 00690101715

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 CERTIFICATE

This is to certify that project title is “MARKETING STRATEGY FOR

INSURANCE PRODUCT IN DELHI NCR BY RELIANCE LIFE
INSURANCE’’ the original work of AMAN of BBA(G) 6th Semester and has

been duly completed under my guidance and supervision up to my

satisfactory level. This work has been done in partial fulfillment of the
requirement for the award of the degree of BBA (G) from FAIRFIELD
INSTITUTE OF MANAGEMENT & TECHNOLOGY, NEW DELHI,
AFFILIATED BY GGSIPU and has not been submitted anywhere in any

other university for the award of any degree.

Dr. SHWETA GUPTA

SR. ASST. PROF,FIMT

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 Acknowledgement

It is pleasure to acknowledge many people who knowingly and

unwittingly helped me, to complete my project. First of all let me praise
god for all the blessings, which carried me through all those years.

I am particularly indebted to Dr. SHWETA GUPTA of the Fairfield

Institute of Management and Technology which inculcated in me
utmost respect for human values and groomed me up in the field of
software technology to take on the challenges of the competitive
world. First and foremost, I would like to express my regards to Dr.
Shweta Gupta for her constant encouragement and support. I would also
like to express my immense gratitude towards my guide for providing the
invaluable knowledge, guidance, encouragement extended during the
completion of this project. Last but not the least; I am grateful to my
parents, my sister, my brother, my friends and all well-wishers for their
moral support and encouragement during the entire period of time.

Signature of the student

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 EXECUTIVE SUMMARY

Insurance plays a very important role in everyone’s life. Insurance not only provides

protection for an individual and industry through risk coverage but also mobilizes

funds for economic activities, and encourages savings. Thus, an insurance cover is

considered to be an important tool for economic stability and is a key sector in the

economy of any country.

This project gives a background of the sector (taking the case study of Reliance Life

Insurance.) and proceeds to highlight the shortcomings of the existing setup and

players. The benefits of a liberalised sector have been enumerated. The thesis also

tries to identify the market potential for insurance products and the strategies that can

be employed to exploit it. Also in this project report I highlighted they key

contributed thing of reliance life insurance with the ICICI.

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 CONTENTS

CHAPTER 1

 Introduction to the Industy…………………………….. 8-24

CHAPTER 2

 Introduction to the Company…………………………. 26-56

CHAPTER 3

 Research Methodology………………………………. 58-59

CHAPTER 4

 Data Analysis and Interpretation ……………………. 61-77

CHAPTER 5

 Conclusion and Finding……………………………… 79

CHAPTER 6

 Recommendation……………………………………… 81

CHAPTER 7

 Bibliography …………………………………………. 83

 Annexure……………………………………………… 84-86

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 CHAPTER 1

INTRODUCTION TO THE INDUSTRY

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With the largest number of Life Insurance policies in force in the world, Insurance
happens to be a mega opportunity in India. It’s a business growing at the rate of 15-20
per cent annually and presently is of the order of Rs 1560.41 billion (for the financial
year 2006 – 2007). Together with banking services, it adds about 7% to the country’s
Gross Domestic Product (GDP). The gross premium collection is nearly 2% of GDP
and funds available with LIC for investments are 8% of the GDP.

Even so nearly 65% of the Indian population is without Life Insurance cover while
health insurance and non-Life Insurance continues to be below international
standards. A large part of our population is also subject to weak social security and
pension systems with hardly any old age income security

A well-developed and evolved insurance sector is needed for economic development

as it provides long term funds for infrastructure development and strengthens the risk
taking ability of individuals. It is estimated that over the next ten years India would
require investments of the order of one trillion US dollars.

HISTORICAL PERSPECTIVE

The history of Life Insurance in India dates back to 1818 when it was conceived as a
means to provide for English Widows. Interestingly in those days a higher premium
was charged for Indian lives than the non - Indian lives, as Indian lives were
considered more risky to cover. The Bombay Mutual Life Insurance Society started
its business in 1870. It was the first company to charge the same premium for both
Indian and non-Indian lives.

The Oriental Assurance Company was established in 1880. The General insurance
business in India, on the other hand, can trace its roots to Triton Insurance Company
Limited, the first general insurance company established in the year 1850 in Calcutta
by the British. Till the end of the nineteenth century insurance business was almost
entirely in the hands of overseas companies.

Insurance regulation formally began in India with the passing of the Life Insurance
Companies Act of 1912 and the Provident Fund Act of 1912. Several frauds during
the 1920's and 1930's sullied insurance business in India. By 1938 there were 176
insurance companies.

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The first comprehensive legislation was introduced with the Insurance Act of 1938
that provided strict State Control over the insurance business. The insurance business
grew at a faster pace after independence. Indian companies strengthened their hold on
this business but despite the growth that was witnessed, insurance remained an urban
phenomenon.

The Government of India in 1956, brought together over 240 private life insurers and
provident societies under one nationalized monopoly corporation and Life Insurance
Corporation (LIC) was born. Nationalization was justified on the grounds that it
would create the much needed funds for rapid industrialization. This was in
conformity with the Government's chosen path of State led planning and
development.

The non-Life Insurance business continued to thrive with the private sector till 1972.
Their operations were restricted to organized trade and industry in large cities. The
general insurance industry was nationalized in 1972. With this, nearly 107 insurers
were amalgamated and grouped into four companies- National Insurance Company,
New India Assurance Company, Oriental Insurance Company and United India
Insurance Company. These were subsidiaries of the General Insurance Company
(GIC).

KEY MILESTONES

1912: The Indian Life Assurance Companies Act enacted as the first statute to
regulate the Life Insurance business.

1928: The Indian Insurance Companies Act enacted to enable the government to
collect statistical information about both life and non-Life Insurance businesses.

1938: Earlier legislation consolidated and amended by the Insurance Act with the
objective of protecting the interests of the insuring public.

1956: 245 Indian and foreign insurers along with provident societies were taken over
by the central government and nationalized. LIC was formed by an Act of Parliament-
LIC Act 1956- with a capital contribution of Rs. 5 crore from the Government of
India.

9
INDUSTRY REFORMS

Reforms in the Insurance sector were initiated with the passage of the IRDA Bill in
Parliament in December 1999. The IRDA since its incorporation as a statutory body
in April 2000 has fastidiously stuck to its schedule of framing regulations and
registering the private sector insurance companies. Since being set up as an
independent statutory body the IRDA has put in a framework of globally compatible
regulations.

The other decision taken simultaneously to provide the supporting systems to the
insurance sector and in particular the Life Insurance companies was the launch of the
IRDA online service for issue and renewal of licenses to agents. The approval of
institutions for imparting training to agents has also ensured that the insurance
companies would have a trained workforce of insurance agents in place to sell their
products.

PRESENT SCENARIO - Life Insurance INDUSTRY IN INDIA

The Life Insurance industry in India grew by an impressive 47.38%, with premium
income at Rs. 1560.41 billion during the fiscal year 2006-2007. Though the total
volume of LIC's business increased in the last fiscal year (2006-2007) compared to
the previous one, its market share came down from 85.75% to 81.91%.

The 17 private insurers increased their market share from about 15% to about 19% in
a year's time. The figures for the first two months of the fiscal year 2007-08 also
speak of the growing share of the private insurers. The share of LIC for this period
has further come down to 75 percent, while the private players have grabbed over 24
percent.

With the opening up of the insurance industry in India many foreign players have
entered the market. The restriction on these companies is that they are not allowed to
have more than a 26% stake in a company’s ownership.

Since the opening up of the insurance sector in 1999, foreign investments of Rs. 8.7
billion have poured into the Indian market and 19 private Life Insurance companies
have been granted licenses.

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Innovative products, smart marketing, and aggressive distribution have enabled
fledgling private insurance companies to sign up Indian customers faster than anyone
expected. Indians, who had always seen Life Insurance as a tax saving device, are
now suddenly turning to the private sector and snapping up the new innovative
products on offer. Some of these products include investment plans with insurance
and good returns (unit linked plans), multi – purpose insurance plans, pension plans,
child plans and money back plans. (www.wikipedia.com)

Insurance is a social device where uncertain risks of individuals may be combined in

a group and thus made more certain – small periodic contribution by the individuals
provide a fund, out of which those who suffer losses may be reimbursed. In addition
to being a means to protect oneself, the Insurance Industry is an effective conduit for
the savings of people to be channeled towards economic growth. In India, the
Insurance Industry is more than 150 years old. It was monopolized by two Public
Sector Undertakings in their respective fields of Life and General Insurance.

Insurance plays a very important role in the day-to-day activities of the common man,
business houses, industries, agriculturists and other service providers. Insurance not
only provides protection for individual and industry through risk coverage; it also
mobilizes funds for economic activity and encourages savings. Thus an insurance
cover is considered an important tool for economic stability. The insurance industry is
a key sector in the economy of any country.

The liberalization of the financial sectors was started in 1991 and carried forward by
successive governments. These reforms were carried out in a phased manner and
affected the entire financial sector. The insurance sector had been left out of this
reform process for a very long time. The passage of the IRDA bill in December 1999
has paved the way for the entry of private players into this long neglected aspect of
the Indian economy. However, the opening up of this sector does not mean that its
character will undergo a sea change. The public sector behemoths will continue to
enjoy a huge market share. It is up to the new players to device innovative strategies
to both grab business from the existing companies as well as expand the size of their
pie. The new entrants will look for new channels of distribution for their products.
Banks will play a very important part as they likely to act as interfaces between the
insurance companies and their prospective customers. The main benefits of this new

11
competitive environment will be to the consumer, who till now, has had to put up with
shoddy products and even shoddier service.

The report gives a brief background of the sector and proceeds to highlight the
shortcomings of the existing setup and players. The benefits of a liberalized sector are
enumerated. The report also tried to identify the market potential for insurance
products and the strategies that can be employed to exploit the same.

Despite innumerable delays the sector has finally opened up for private competition.
The threat of private players shaking and giving the run for incremental market share
for the Public Sector mammoths has been overplayed. The number of potential buyers
of insurance is certainly attractive but much of this population might not be
accessible. New insurers must segment the market carefully to arrive at the
appropriate products and pricing. Since distribution will be a key determinant of
success for all insurance companies regardless of age or ownership; a total change is
expected in the distribution network. As the product move towards the mature stages
of communization (increased awareness and popularity) they could then a host of new
channels like grocery stores, direct mails. Regulators must formulate strong and fair
guidelines and ensure that old and new players are subject to the same rules and at the
same time the government should ensure that the IRDA (Insurance Regulatory and
Development Authority of India) does not become yet another toothless tiger like
CEA or TRAI.

INSURANCE – ON THRESHOLD

The liberalization of the Indian insurance sector has been the subject of much heated
debate for some years. The policy makers where in the catch 22 situation wherein for
one they wanted competition, development and growth of this insurance sector which
is extremely essential for channeling the investments in to the infrastructure sector. At
the other end the policy makers had the fears that the insurance premium which are
substantial, would seep out of the country; and wanted to have a cautious approach of
opening for foreign participation in the sector.

As one of the rare occurrences the entire debate was put on the back burner and the
IRDA saw the day of the light thanks to the maturing polity emerging consensus
among factions of different political parties. Though some changes and some

12
restrictive clauses as regards to the foreign participation were included the IRDA has
opened the doors for the private entry into insurance.

Whether the insurer is old or new, private or public, expanding the market will
present multitude of challenges and opportunities. But the key issues, possible trends,
opportunities and challenges that insurance sector will have still remain under the
realms of the possibilities and speculation. What is the likely impact of opening up
India’s insurance sector?

BROADENING OF BENEFITS

The large scale of operations, public sector bureaucracies and cumbersome

procedures hamper nationalized insurers. Therefore, potential private entrants expect
to score in the areas of customer service, speed and flexibility. They point out that
their entry will mean better products and choice for the consumer. The critics counter
that the benefit will be slim, because new players will concentrate on affluent, urban
customers as foreign banks did until recently. This seems to be a logical strategy.
Start-up costs-such as those of setting up a conventional distribution network are large
and high-end niches offer better returns. However, the middle-market segment too has
great potential. Since insurance is a volumes game. Therefore, private insurers would
be best served by a middle-market approach, targeting customer segments that are
currently untapped.

UNREALISTIC - FEARS

An often-voiced concern is that private players, especially foreign ones, will swamp
the market, grabbing a large share. A similar threat was overplayed in the case of
basic telephone services and when the private players started their operations the
dominance and might of DoT has remain unaltered. This hypothesis that the private
players would swamp the market has been disproved in many emerging markets
worldwide not only in case of the insurance but in numerous different sectors (Power,
Energy, Telecom, Insurance etc.).

Yet, multinational insurers are keenly interested in emerging insurance because their
home markets are saturated while emerging countries; like India have low insurance
penetrations and high growth rates. International insurers often derive a significant
part of their business from multinational operations. As early as 1994, many of the

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UK’s largest life and general insurers derived 40% to 60% of their total premium
from outside their home markets. Though the global operations of the multinational
insurers have an immense impact on their typically foreign insurers take only a small
share of an individual country’s market. For example in Taiwan the foreign
companies took only a 3% share even seven years after opening up while in Korea,
their share was barely 1% after 20 years. In India, therefore, the new entrants would
face the challenge of playing within a small share of a large and growing market
which could be possibly profitable.

UNTAPPED OPPORTUNITIES

There is no doubt that the potential market for the buyers of insurance is significant in
India and offers a great scope of growth. First, while estimating the potential of the
Indian insurance market we often tempt to look at it from the perspective of macro-
economic variables such as the ratio of premium to GDP which is indeed
comparatively low in India. For example, India’s Life Insurance premium as a
percentage of GDP is 1.3% to 1.5% against 5.2% in the US, 6.5% in the UK or 8% in
South Korea. But the fact is that; the large part of the India’s, (the number of potential
buyers of insurance) is certainly attractive. However, this ignores the difficulties of
approaching this population. New entrants in other mass industries such as consumer
products or retail banking have discovered this after suffering heavy losses. Much of
the demand may not be accessible because of poor distribution, large distances or
high costs relative to returns.

Secondly most new entrants have a tendency to target the business of existing
companies rather than expanding the market, this is myopic. This not only leads to
intense competition for the new players but also much of their effort is spent on trying
to capture existing customers by offering better service or other advantages. Hence,
the benefits of this strategy are likely to be limited. For example, 50% of the current
demand for general insurance comes from the corporate segment. The corporate are
likely to shop around for the best rates, products and service. Nevertheless, the
corporate segment, as a whole will not be a big growth area for new entrants. This is
because penetration is already good, companies receive good service because of their
size and rates are tariff-governed. In both volumes and profitability therefore, the

14
scope for expansion is modest. A better approach may be to examine specific niches
where demand can be met or stimulated.

KEY - INNOVATION & VARIETY OF PRODUCTS

The new entrants would be best served by micro-level two pronged strategies. First, is
to introduce innovative products offering a right mix of flexibility/risk/return
depending which will suit the appetite of the customers and the secondly they would
target specific niches, which are poorly served or are not served at all

The first prong of a new insurer’s strategy could be to stimulate demand in areas that
are currently not served at all. For example, Indian general insurance focuses on the
manufacturing segment. However, the services sector is taking a large and growing
share of India’s GDP. This offers immense opportunities for expansion opportunities.
For example, revenue from remote processing activities in information technology is
estimated at US $50 billion in the next ten years. Insurers could respond with various
liability covers.

Being the agrarian economy again there are immense opportunities for the new
entrants to provide the liability and risks associated in this sector like weather
insurance, rainfall insurance, cyclone insurance, crop insurance etc.

Next, the financial sector is aggressively targeting retail investors. Housing finance,
auto finance, credit cards and consumer loans all offer an opportunity for insurance
companies to introduce new products like creditor insurance etc. Similarly, organized
sector sale of TVs, refrigerators, washing machines and audio systems in 1998 was
around Rs.110 billion. Only a negligible portion of these purchases was insured.
Potential buyers for most of this insurance lie in the middle class. Existing players can
also profitably exploit these areas.

In case there are products, which are not serving adequately new products many of
them, which are already prevalent in different markets can be customized to the
Indian markets and used to expand the markets. For example Life Insurance products
provide a good example. Life Insurance products have to compete with savings and
mutual funds hence should offer various dimensions of risk/return/flexibility so they
can be linked to stock market indices, inflation etc. making them more competitive
and appropriate risk/return appetite for different investors at present there are no such

15
products. Similar problems apply to pensions. For instance, pure protection products
like term assurance account for up to 20% of policies sold in developed countries. In
India, the figure is less than one percent because policies are inflexible. They compete
with investment and savings options like mutual funds. It is imperative that they
should offer comparable returns and flexibility and there is immense scope of
developing pure insurance products with flexibility.

The lack of a comprehensive social security system combined with a willingness to

save means that Indian demand for pension products will be large. However, current
penetration is poor. Making pension products into attractive saving instruments would
require only simple innovations already prevalent in other markets. For example, their
returns might be tied to index-linked funds or a specific basket of equities. Buyers
could be allowed to switch funds before the annuities begin and to invest different
amounts at different times

Health insurance is another segment with great potential because existing Indian
products are insufficient. Till now, LIC’s Mediclaim scheme covered only 2.50
million people. Indian products do not cover disability arising out of illness or
disability for over 100 weeks due to accident. Neither do they cover a potential loss of
earnings through disability

Who are Agents?

Agents in a legal sense means a person who is employed to perform and act on half of
others (principal) for a price called as commission. Agents in Life Insurance context
means the person holding a valid license from Insurance Regulatory Development
Authority (IRDA) issued in accordance with the IRDA Regulations.

Minimum conditions to be fulfilled to become an agent (As per IRDA Regulations)

Qualifications

Qualifications of the Applicant: The applicant shall possess the minimum

qualification of a pass in 12th Standard or equivalent examination conducted by any
recognised Board/Institution, where the applicant resides in a place with a population
of five thousand or more as per the last census, should have passed in 10th Standard

16
or equivalent examination from a recognised Board/Institution if the applicant resides
in any other place.

Practical Training:

(1) The applicant shall have completed from an approved institution, at least, one
hundred hours' practical training in life or general insurance business, as the case may
be, which may be spread over three to four weeks, where such applicant is seeking
license for the first time to act as insurance agent.

Provided that the applicant shall have completed from an approved institution, at
least, one hundred fifty hours' practical training in life and general insurance business,
which may be spread over six to eight weeks, where such applicant is seeking license
for the first time to act as a composite insurance agent.

2. Where the applicant, referred to under sub-regulation (1), is:

(i) An Associate/Fellow' of the Insurance Institute of India, Mumbai;

(ii) An Associate/Fellow of the Institute of Chartered Accountants of India, New

Delhi;

(i) An Associate/fellow of the Institute of Costs and Works Accountants of India,

Kolkata.

(ii) An Associate/Fellow of the Institute of Company Secretaries of India, New Delhi.

(iii) An Associate/Fellow of the Actuarial Society of India, Mumbai;

(vi) A Master of Business Administration of any Institution/University recognised by

any State Government or the Central Government; or

(vii) Possessing any professional qualification in marketing from any

Institution/University recognized by any State Government or the Central
Government:

He shall have completed, at least, fifty hours' practical training from an approved
institution.

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Provided that such applicant shall have completed from an approved institution, at
least, seventy hours' practical training in life and general insurance business, where
such applicant is seeking license for the first time to act as a composite insurance
agent.

3. An applicant, who has been granted a license after the commencement of these
regulations, before seeking renewal of license to act as an insurance agent, shall have
completed, at least twenty-five hours' practical training in life or general insurance
business, as the case may be, from an approved institution.

Provided that such applicant before seeking renewal of license to act as a composite
insurance agent shall have completed from an approved institution, at least, fifty
hours' practical training in life and general insurance business.

Insurance is system by which the losses suffered by a few are spread over many,
exposed to similar risks. Insurance is a protection against financial loss arising on the
happening of an unexpected event. Insurance policy helps in not only mitigating risks
but also provides a financial cushion against adverse financial burdens suffered.

Insurance policies cover the risk of life as well as other assets and valuables such as
home, automobiles, jewelery.

The functions of Insurance can be bifurcated into two parts:

 Primary Functions

 Secondary Functions

 Other Functions

Primary Functions

Provide Protection: The primary function of insurance is to provide protection

against future risk, accidents and uncertainty. Insurance cannot check the happening
of the risk, but can certainly provide for the losses of risk. Insurance is actually a
protection against economic loss, by sharing the risk with others.

Collective Bearing of Risk: Insurance is a device to share the financial loss of few
among many others. Insurance is a mean by which few losses are shared among larger

18
number of people. All the insured contribute the premiums towards a fund and out of
which the persons exposed to a particular risk is paid.

Assessment of Risk: Insurance determines the probable volume of risk by evaluating

various factors that give rise to risk. Risk is the basis for determining the premium
rate also

Provide Certainty: Insurance is a device, which helps to change from uncertainty to

certainty. Insurance is device whereby the uncertain risks may be made more certain.

Secondary Functions

Prevention of Losses: Insurance cautions individuals and businessmen to adopt

suitable device to prevent unfortunate consequences of risk by observing safety
instructions; installation of automatic sparkler or alarm systems, etc. Prevention of
losses cause lesser payment to the assured by the insurer and this will encourage for
more savings by way of premium. Reduced rate of premiums stimulate for more
business and better protection to the insured.

Small Capital to cover Larger Risks: Insurance relieves the businessmen from
security investments, by paying small amount of premium against larger risks and
uncertainty.

Contributes towards the Development of Larger Industries: Insurance provides

development opportunity to those larger industries having more risks in their setting
up. Even the financial institutions may be prepared to give credit to sick industrial
units which have insured their assets including plant and machinery.

Other Functions

Means of Savings and Investment: Insurance serves as savings and investment,

insurance is a compulsory way of savings and it restricts the unnecessary expenses by
the insured's For the purpose of availing income-tax exemptions also, people invest in
insurance.

Source of Earning Foreign Exchange: Insurance is an international business. The

country can earn foreign exchange by way of issue of marine insurance policies and
various other ways.

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Risk Free Trade: Insurance promotes exports insurance, which makes the foreign
trade risk free with the help of different types of policies under marine insurance
cover.

Brief History of Insurance Sector in India

The insurance sector in India has come a full circle from being an open competitive
market to nationalization and back to a liberalized market again.Tracing the
developments in the Indian insurance sector reveals the 360-degree turn witnessed
over a period of almost 190 years.The business of Life Insurance in India in its
existing form started in India in the year 1818 with the establishment of the Oriental
Life Insurance Company in Calcutta.

Milestone of Life Insurance in India

1912:The Indian Life Assurance Companies Act enacted as the first statute to regulate
the Life Insurance business.

1928:The Indian Insurance Companies Act enacted to enable the government to

collect statistical information about both life and non-Life Insurance businesses.

1938:Earlier legislation consolidated and amended to by the Insurance Act with the
objective of protecting the interests of the insuring public.

1956:245 Indian and foreign insurers and provident societies taken over by the central
government and nationalized. LIC formed by an Act of Parliament, viz. LIC Act,
1956, with a capital contribution of Rs. 5 crore from the Government of India.

The General insurance business in India, on the other hand, can trace its roots to the
Triton Insurance Company Ltd., the first general insurance company established in
the year 1850 in Calcutta by the British.

Some of the important milestones in the general insurance business in India are:

1907 - The Indian Mercantile Insurance Ltd. set up, the first company to transact all
classes of general insurance business.

1957 - General Insurance Council, a wing of the Insurance Association of India,

frames a code of conduct for ensuring fair conduct and sound business practices.

20
1968 - The Insurance Act amended to regulate investments and set minimum
solvency margins and the Tariff Advisory Committee set up.

1972 - The General Insurance Business (Nationalization) Act, 1972 nationalized the
general insurance business in India with effect from 1st January 1973.

107 insurers amalgamated and grouped into four companies viz. the National
Insurance Company Ltd., the New India Assurance Company Ltd., the Oriental
Insurance Company Ltd. and the United India Insurance Company Ltd. GIC
incorporated as a company.

On the basis of the risk they cover, insurance policies can be classified into two
categories:

 Life Insurance Policies

 General Insurance Policies

 Life Insurance, India

Life is very fragile and death is a certainty. We cannot control the uncertainties of life.
But, we can cover the risks surrounding us. Life Insurance, simply put, is the cover
for the risks that we run during our lives. It protects us from the contingencies that
could affect us.

History of insurance

Insurance began as a way of reducing the risk of traders, as early as 5000 BC in China
and 4500 BC in Babylon. Life Insurance dates only to ancient Rome; "burial clubs"
covered the cost of members' funeral expenses and helped survivors monetarily.
Modern Life Insurance started in late 17th century England, originally as insurance
for traders: merchants, ship owners and underwriters met to discuss deals at Lloyd's
Coffee House, predecessor to the famous Lloyd's of London.

The first insurance company in the United States was formed in Charleston, South
Carolina in 1732, but it provided only fire insurance. The sale of Life Insurance in the
U.S. began in the late 1760s. The Presbyterian Synods in Philadelphia and New York
created the Corporation for Relief of Poor and Distressed Widows and Children of
Presbyterian Ministers in 1759; Episcopalian priests organized a similar fund in 1769.

21
Between 1787 and 1837 more than two dozen Life Insurance companies were started,
but fewer than half a dozen survived.

Prior to the American Civil War, many insurance companies in the United States
insured the lives of slaves for their owners. In response to bills passed in California in
2001 and in Illinois in 2003, the companies have been required to search their records
for such policies. New York Life for example reported that Nautilus sold 485
slaveholder Life Insurance policies during a two-year period in the 1840s; they added
that their trustees voted to end the sale of such policies 15 years before the
Emancipation Proclamation.

Market trends

Life Insurance premiums written in 2005According to a study by Swiss Re, the EU

was the largest market for Life Insurance premiums written in 2005 followed by the
USA and Japan.

Although some aspects of the application process (such as underwriting and insurable
interest provisions) make it difficult, Life Insurance policies have been used in cases
of exploitation and fraud. In the case of Life Insurance, there is a motivation to
purchase a Life Insurance policy, particularly if the face value is substantial, and then
kill the insured.

The television series Forensic Files has included episodes that feature this scenario.
There was also a documented case in 2006, where two elderly women are accused of
taking in homeless men and assisting them. As part of their assistance, they took out
Life Insurance on the men. After the contestability period ended on the policies (most
life contracts have a standard contestability period of two years), the women are
alleged to have had the men killed via hit-and-run car crashes.

Recently, viatical settlements have thrown the Life Insurance industry into turmoil. A
viatical settlement involves the purchase of a Life Insurance policy from an elderly or
terminally ill policy holder. The policy holder sells the policy (including the right to
name the beneficiary) to a purchaser for a price discounted from the policy value. The
seller has cash in hand, and the purchaser will realize a profit when the seller dies and
the proceeds are delivered to the purchaser. In the meantime, the purchaser continues
to pay the premiums. Although both parties have reached an agreeable settlement,

22
insurers are troubled by this trend. Insurers calculate their rates with the assumption
that a certain portion of policy holders will seek to redeem the cash value of their
insurance policies before death. They also expect that a certain portion will stop
paying premiums and forfeit their policies. However, viatical settlements ensure that
such policies will with absolute certainty be paid out. Some purchasers, in order to
take advantage of the potentially large profits, have even actively sought to collude
with uninsured elderly and terminally ill patients, and created policies that would have
not otherwise been purchased. Likewise, these policies are guaranteed losses from the
insurers' perspective.

Life Insurance Corporation of India

Life Insurance Corporation (LIC) came into existence on 1st September 1956 through
the amalgamation of 154 Indian insurance companies, 16 non-Indian companies and
75 provident. The amalgamation was achieved with the help of Life Insurance Act
passed by the Parliament in the same year. The LIC was created with the goal of
reaching all the insurable people in the country and providing them financial coverage
at a reasonable price. In the year 1956, LIC had 5 zonal offices, 33 divisional offices
and 212 branch offices. With time there was a need for a branch office at every
district headquarter and many branches were opened, which raised the pace of the
organization.

LIC now has 2048 fully computerized branch offices, 100 divisional offices, 7 zonal
offices and the corporate office. At present, online premium collection facility is
being offered in selected cities as LIC has tied up with some banks and service
providers. For providing customer satisfaction the organization has introduced various
schemes such as ECS, ATM premium payment facility, IVRS, Info centers which are
set up in various cities including Mumbai, Bangalore, Chennai, Kolkata, New Delhi,
Pune and many more. It has also come up with SATELLITE SAMPARK offices
providing easy access to policyholders. LIC has crossed many milestones and set
standards for itself fostering unmatched performance.

Initiative

 Holding the money with obligation and using it in the best possible manner in
the interests of the policyholder and the community.

23
 Bringing attractive savings plans and making them easily accessible to the
policyholders.

 Giving attractive returns to the people and keeping in mind national priorities.

 Being trustworthy to the customers and develop the spirit of corporate social
responsibility.

 Spreading insurance in both rural and urban areas and covering all the
insurable persons at a reasonable cost.

 Bringing in plans and policies favorable to the changing environment.

 Providing efficient service and involving people in the organization for their
satisfaction.

24
 CHAPTER 2

INTRODUCTION TO THE COMPANY

25
 COMPANY PROFILE

FOUNDER

Few men in history have made as dramatic a contribution to their country’s economic
fortunes as did the founder of Reliance, Sh. Dhirubhai H Ambani. Fewer still have left
behind a legacy that is more enduring and timeless.

 As with all great pioneers, there is more than one unique way of describing the
true genius of Dhirubhai: The corporate visionary, the unmatched strategist, the
proud patriot, the leader of men, the architect of India’s capital markets, the
champion of shareholder interest.

 But the role Dhirubhai cherished most was perhaps that of India’s greatest wealth
creator. In one lifetime, he built, starting from the proverbial scratch, India’s
largest private sector enterprise.

 When Dhirubhai embarked on his first business venture, he had a seed capital of
barely US$ 300 (around Rs 14,000). Over the next three and a half decades, he
converted this fledgling enterprise into a Rs 60,000 crore colossus—an
achievement which earned Reliance a place on the global Fortune 500 list, the
first ever Indian private company to do so.

 Dhirubhai is widely regarded as the father of India’s capital markets. In 1977,

when Reliance Textile Industries Limited first went public, the Indian stock
market was a place patronised by a small club of elite investors which dabbled in
a handful of stocks.

 Undaunted, Dhirubhai managed to convince a large number of first-time retail

investors to participate in the unfolding Reliance story and put their hard-earned
money in the Reliance Textile IPO, promising them, in exchange for their trust,
substantial return on their investments. It was to be the start of one of great stories
of mutual respect and reciprocal gain in the Indian markets.

 Under Dhirubhai’s extraordinary vision and leadership, Reliance scripted one of

the greatest growth stories in corporate history anywhere in the world, and went
on to become India’s largest private sector enterprise.

 Through out this amazing journey, Dhirubhai always kept the interests of the
ordinary shareholder uppermost in mind, in the process making millionaires out of

26
 many of the initial investors in the Reliance stock, and creating one of the world’s
largest shareholder families.

ABOUT RELIANCE

Reliance Life Insurance Company Limited is a part of Reliance Capital Ltd. of the
Reliance - Anil Dhirubhai Ambani Group. Reliance Capital is one of India’s leading
private sector financial services companies, and ranks among the top 3 private sector
financial services and banking companies, in terms of net worth. Reliance Capital has
interests in asset management and mutual funds, stock broking, life and general
insurance, proprietary investments, private equity and other activities in financial
services.

 Reliance Capital Limited (RCL) is a Non-Banking Financial Company (NBFC)

registered with the Reserve Bank of India under section 45-IA of the Reserve
Bank of India Act, 1934.

 Reliance Capital sees immense potential in the rapidly growing financial services
sector in India and aims to become a dominant player in this industry and offer
fully integrated financial services.

 Reliance Life Insurance is another step forward for Reliance Capital Limited to
offer need based Life Insurance solutions to individuals and Corporates.

CORPORATE OBJECTIVE

At Reliance Life Insurance, we strongly believe that as life is different at every stage,
life insurance must offer flexibility and choice to go with that stage. We are fully
prepared and committed to guide you on insurance products and services through our
well-trained advisors, backed by competent marketing and customer services, in the
best possible way.

 It is our aim to become one of the top private life insurance companies in India
and to become a cornerstone of RLI integrated financial services business in
India.

27
CORPORATE MISSION

 “To set the standard in helping our customers manage their financial future”.

BELOW ARE FEW OF THE PLANS THAT ARE OFFERED BY RELIANCE

LIFE INSURANCE

INSURANCE PLANS AVAILABLE

1. Products (Individual Plans)

Savings (Endowment)

2. Reliance Endowment Plan

(formerly Divya Shree)

3. Reliance Special Endowment Plan

(formerly Subha Shree)

4. Reliance Cash Flow Plan

(formerly Dhana Shree)

5. Reliance Child Plan

(formerly Yuva Shree)

6. Reliance Whole Life Plan

(formerly Nithya Shree)

Pensions

7. Reliance Golden Years Plan

(formerly Bhagya Shree)

Investments

8. Reliance Market Return Plan

(formerly Kanaka Shree)

9. Risk / Protection

10. Reliance Term Plan

(formerly Raksha Shree)

Products (Group / Corporate Plans)

11. Risk (Protection)

28
 Reliance Group Term Assurance Policy
(formerly Group Term Assurance Policy)

Reliance EDLI Scheme

(formerly EDLI Scheme)

12. Pensions

a. Reliance Group Gratuity Policy

(formerly Group Gratuity Policy)

b. Reliance Group Superannuation Policy

(formerly Group Superannuation Policy)

13. Reliance Money Guarantee Plan

Tax Benefits

INCOME TAX GROSS ANNUAL HOW MUCH HDFC STANDARD

SECTION SALARY TAX CAN YOU LIFE PLANS
SAVE?

Sec. 80C Across All income Upto Rs. 33,990 All the life insurance
Slabs saved on plans.
investment of
Rs. 1,00,000.

Sec. 80 CCC Across all income Upto Rs. 33,990 All the pension plans.
slabs. saved on
Investment of
Rs.1,00,000.

Sec. 80 D Across all income Upto Rs. 3,399 All the health
slabs saved on insurance riders
Investment of available with the
Rs. 10,000. conventional plans.

29
TOTAL SAVINGS
POSSIBLE Rs37,389

Rs. 33,990 under Sec. 80C and under Sec. 80 CCC , Rs.3,399 under
Sec. 80 D, calculated for a male with gross annual income
exceeding Rs. 10,00,000.

Sec. 10 (10)D Under Sec. 10(10D), the benefits you receive are completely tax-
free, subject to the conditions laid down therein.

2.2 OTHER COMPETITIORS

MAJOR PLAYERS IN THE INSURANCE INDUSTRY IN INDIA

 Life Insurance Corporation of India (LIC)

Life Insurance Corporation of India (LIC) was established on 1 September 1956 to

spread the message of life insurance in the country and mobilise people’s savings for
nation-building activities. LIC with its central office in Mumbai and seven zonal
offices at Mumbai, Calcutta, Delhi, Chennai, Hyderabad, Kanpur and Bhopal,
operates through 100 divisional offices in important cities and 2,048 branch offices.
LIC has 5.59 lakh active agents spread over the country.

The Corporation also transacts business abroad and has offices in Fiji, Mauritius and
United Kingdom. LIC is associated with joint ventures abroad in the field of
insurance, namely, Ken-India Assurance Company Limited, Nairobi; United Oriental
Assurance Company Limited, Kuala Lumpur; and Life Insurance Corporation
(International), E.C. Bahrain. It has also entered into an agreement with the Sun Life
(UK) for marketing unit linked life insurance and pension policies in U.K.

In 1995-96, LIC had a total income from premium and investments of $ 5 Billion
while GIC recorded a net premium of $ 1.3 Billion. During the last 15 years, LIC's
income grew at a healthy average of 10 per cent as against the industry's 6.7 per cent
growth in the rest of Asia (3.4 per cent in Europe, 1.4 per cent in the US).

30
LIC has even provided insurance cover to five million people living below the
poverty line, with 50 per cent subsidy in the premium rates. LIC's claims settlement
ratio at 95 per cent and GIC's at 74 per cent are higher than that of global average of
40 per cent. Compounded annual growth rate for Life insurance business has been
19.22 per cent per annum

 General Insurance Corporation of India (GIC)

The general insurance industry in India was nationalized and a government company
known as General Insurance Corporation of India (GIC) was formed by the Central
Government in November 1972. With effect from 1 January 1973 the erstwhile 107
Indian and foreign insurers which were operating in the country prior to
nationalization, were grouped into four operating companies, namely, (i) National
Insurance Company Limited; (ii) New India Assurance Company Limited; (iii)
Oriental Insurance Company Limited; and (iv) United India Insurance Company
Limited. (However, with effect from Dec'2000, these subsidiaries have been de-
linked from the parent company and made as independent insurance companies). All
the above four subsidiaries of GIC operate all over the country competing with one
another and underwriting various classes of general insurance business except for
aviation insurance of national airlines and crop insurance which is handled by the
GIC.

Besides the domestic market, the industry is presently operating in 17 countries

directly through branches or agencies and in 14 countries through subsidiary and
associate companies.

IN ADDITION TO ABOVE STATE INSURERS THE FOLLOWING HAVE

BEEN PERMITTED TO ENTER INTO INSURANCE BUSINESS: -

The introduction of private players in the industry has added to the colors in the dull
industry. The initiatives taken by the private players are very competitive and have
given immense competition to the on time monopoly of the market LIC. Since the
advent of the private players in the market the industry has seen new and innovative
steps taken by the players in this sector. The new players have improved the service
quality of the insurance. As a result LIC down the years have seen the declining phase
in its career. The market share was distributed among the private players. Though LIC
still holds the 75% of the insurance sector but the upcoming natures of these private

31
players are enough to give more competition to LIC in the near future. LIC market
share has decreased from 95% (2002-03) to 82 %( 2004-05).

1. HDFC Standard Life Insurance Company Ltd.

HDFC Standard Life Insurance Company Ltd. is one of India’s leading private life
insurance companies, which offers a range of individual and group insurance
solutions. It is a joint venture between Housing Development Finance Corporation
Limited (HDFC Ltd.), India’s leading housing finance institution and The Standard
Life Assurance Company, a leading provider of financial services from the United
Kingdom. Their cumulative premium income, including the first year premiums and
renewal premiums is Rs. 672.3 for the financial year, Apr-Nov 2005. They have
managed to cover over 11,00,000 individuals out of which over 3,40,000 lives have
been covered through our group business tie-ups.

2. Max New York Life Insurance Co. Ltd.

Max New York Life Insurance Company Limited is a joint venture that brings
together two large forces - Max India Limited, a multi-business corporate, together
with New York Life International, a global expert in life insurance. With their various
Products and Riders, there are more than 400 product combinations to choose from.
They have a national presence with a network of 57 offices in 37 cities across India.

3. ICICI Prudential Life Insurance Company Ltd.

ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank, a
premier financial powerhouse and Prudential plc, a leading international financial
services group headquartered in the United Kingdom. ICICI Prudential was amongst
the first private sector insurance companies to begin operations in December 2000
after receiving approval from Insurance Regulatory Development Authority (IRDA).
The company has a network of about 56,000 advisors; as well as 7 banc assurance and
150 corporate agent tie-ups.

32
4. Om Kotak Mahindra Life Insurance Co. Ltd.

Kotak Mahindra Old Mutual Life Insurance Ltd. is a joint venture between Kotak
Mahindra Bank Ltd. (KMBL), and Old Mutual plc.

5.Birla Sun Life Insurance Company Ltd.

Birla Sun Life Insurance Company is a joint venture between Aditya Birla Group and
Sun Life financial Services of Canada.

 Tata AIG Life Insurance Company Ltd.

 SBI Life Insurance Company Limited

 ING Vysya Life Insurance Company Private Limited

 Allianz Bajaj Life Insurance Company Ltd.

 Metlife India Insurance Company Pvt. Ltd.

 AMP SANMAR Assurance Company Ltd.

 Dabur CGU Life Insurance Company Pvt. Ltd.

1. Royal Sundaram Alliance Insurance Company

The joint venture bringing together Royal & Sun Alliance Insurance and Sundaram
Finance Limited started its operations from March 2001. The company is Head
Quartered at Chennai, and has two Regional Offices, one at Mumbai and another one
at New Delhi.

2. Bajaj Allianz General Insurance Company Limited

Bajaj Allianz General Insurance Company Limited is a joint venture between Bajaj
Auto Limited and Allianz AG of Germany. Both enjoy a reputation of expertise,
stability and strength.

Bajaj Allianz General Insurance received the Insurance Regulatory and Development
Authority (IRDA) certificate of Registration (R3) on May 2nd, 2001 to conduct
General Insurance business (including Life Insurance business) in India. The
Company has an authorized and paid up capital of Rs 110 crores. Bajaj Auto holds
74% and the remaining 26% is held by Allianz, AG, Germany.

33
3. ICICI Lombard General Insurance Company Limited

ICICI Lombard General Insurance Company Limited is a joint venture between ICICI
Bank Limited and the US-based $ 26 billion Fairfax Financial Holdings Limited.
ICICI Bank is India's second largest bank, while Fairfax Financial Holdings is a
diversified financial corporate engaged in general insurance, reinsurance, insurance
claims management and investment management.

Lombard Canada Ltd, a group company of Fairfax Financial Holdings Limited, is one
of Canada's oldest property and casualty insurers. ICICI Lombard General Insurance
Company received regulatory approvals to commence general insurance business in
August 2001.

4. Cholamandalam General Insurance Company Ltd.

Cholamandalam MS General Insurance Company Limited (Chola-MS) is a joint

venture of the Murugappa Group & Mitsui Sumitomo.

Chola-MS commenced operations in October 2002 and has issued more than 1.4 lakh
policies in its first calendar year of operations. The company has a pan-Indian
presence with offices in Chennai, Hyderabad, Bangalore, Kochi, Coimbatore,
Mumbai, Pune, Indore, Ahmedabad, Delhi, Chandigarh, Kolkata and Vizag.

5. TATA AIG General Insurance Company Ltd.

Tata AIG General Insurance Company Ltd. is a joint venture company, formed from
the Tata Group and American International Group, Inc. (AIG). Tata AIG combines
the strength and integrity of the Tata Group with AIG's international expertise and
financial strength. The Tata Group holds 74 per cent stake in the two insurance
ventures while AIG holds the balance 26 per cent stake.

Tata AIG General Insurance Company, which started its operations in India on
January 22, 2001, offers the complete range of insurance for automobile, home,
personal accident, travel, energy, marine, property and casualty, as well as several
specialized financial lines.

34
2.3 Reliance Policies

(1) Reliance Children Plans

What could make you happier than knowing, that your child's future is secure?
Nothing, we suppose. Which is why, Reliance Life Insurance brings to you Reliance
Secure Child Plan, a unit-linked Insurance Plan, that gives you the freedom to enjoy
today with your child, because his tomorrow is in safe hands.

 Do you see your child becoming a trailblazer?

 Will they create the ultimate symphony or give sports a new dimension?

Our children may just be the ones to end the arms race and wipe out poverty from the
face of the Earth. But for them to be able to aim for the skies, YOU NEED TO ACT
NOW!

Introducing Reliance Secure Child Plan - a unique life insurance cum savings plan.
secure the future of your child.

Key Features

Insurance cover on the life of child

Your child is completely protected - we will continue to pay the premiums

even if you are not alive

Life time income to child in the event of disability

Return Shield option to protect your investment returns

Liquidity in the form of partial withdrawals

Capital guarantee available on maturity and on death of the child for basic
and top-up premiums

Option to package with Accidental Death and Total and Permanent

Disablement Rider, Critical Conditions Rider and Term Life Insurance
Benefit Rider.

35
(2)Reliance Health + Wealth Policy

UNDER THIS PLAN THE INVESTMENT RISK IN THE INVESTMENT

PORTFOLIO IS BORNE BY THE POLICYHOLDER.

There are times when late working hours take precedence over your health check-ups.
And there are times when a visit to the doctor seems more important than dividends
on your shares. In the rat race to make money, we often forget to take care of
ourselves.

We understand this predicament. Here is a plan that will ensure that your wealth
keeps increasing constantly and yet your health does not take a backseat. The
Reliance Wealth Health Plan. A plan that gives you the benefits of wealth bhi. health
bhi.

Life changes. And as it does, so do your priorities. After all, the circumstances of your
life can determine the type of health coverage you need.

India has made rapid strides in the health sector. Since Independence, life expectancy
has gone up markedly and survival rates have also increased, still critical health issues
remain. Infectious diseases continue to claim a large number of lives.

Reliance Wealth + Health Plan, a health insurance plan underwritten by Reliance Life
Insurance Company Limited, is designed to work in conjunction with contributions
towards savings.

Key Feature

A Unit Linked plan with Unique Savings Component

Twin benefit of market linked return and health protection

Choose from two different plan options

Flexibility to take care of your family’s health

36
 Flexibility to switch between funds / plan options

Option to pay Top-ups

(3) Reliance Pension Policy

UNDER THIS PLAN THE INVESTMENT RISK IN THE INVESTMENT

PORTFOLIO IS BORNE BY THE POLICYHOLDER.

Retirement means different things to different people, while some want to relax and
take a trip around the world, some want to start up a venture of their own, and pursue
a dream harnessed for years. The power to make your autumn years special lies only
with you. The Reliance Super Golden Years Plan gives you the power and the right
kind of solution - A retirement plan that allows you to save systematically and
generate the much-needed corpus to make your olden years look golden.

Key Features – Reliance Pension Policy :

Invest systematically and secure your golden years

A flexible unit-linked pension product that is different from traditional life

insurance products with Vesting Age between 45 & 70 years

Eight different investment funds to choose from

Flexibility to switch between funds

Option to pay Regular, Single as well as Top-up premiums

Flexibility to advance / extend your Vesting Age

Tax free commutation up to one third of Fund Value at Vesting Age

37
(4) Reliance Whole life insurance policy

You’ve always loved your family. As a loving person you want to be rest assured that
they will be happy, even if something were to happen to you. With Reliance Whole
Life Plan you can be sure that your family will receive that timely financial support
they need. Go ahead, live your today to the fullest, without a worry about tomorrow.

Key Features

Insurance protection till age 85

Choice of extending your insurance coverage till age 99

Convenient Premium Payment Term

Wealth creation through bonus additions

More value for your money by way of High Sum Assured Rebate Get Sum
Assured plus Bonuses in case of your unfortunate death

Option to add two Riders – Critical Illness and Accidental Death Benefit and
Total and Permanent Disablement Rider

Policy Loan available after three full years premium payment

38
ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank, a
premier financial powerhouse and prudential plc, a leading international financial
services group headquartered in the United Kingdom. ICICI Prudential was amongst
the first private sector insurance companies to begin operations in December 2000
after receiving approval from Insurance Regulatory Development Authority (IRDA).

ICICI Prudential's equity base stands at Rs. 9.25 billion with ICICI Bank and
Prudential plc holding 74% and 26% stake respectively. In the period April-December
2004, the company garnered Rs 8.6 billion of new business premium for a total sum
assured of over Rs 73.6 billion and wrote nearly 345,000 policies. The company has a
network of over 50,000 advisors; as well as 7 bank assurance tie-ups. Today, ICICI
Prudential has emerged as the No. 1 private life insurer in the country, with a wide
range of flexible products that meet the needs of the Indian customer at every step in
life.

Vision

To make ICICI Prudential the dominant Life and Pensions player built on trust by
world-class people and service. This we hope to achieve by:

Understanding the needs of customers and offering them superior products and
service

Leveraging technology to service customers quickly, efficiently and conveniently

Developing and implementing superior risk management and investment strategies to

offer sustainable and stable returns to our policyholders

Providing an enabling environment to foster growth and learning for our employees

And above all, building transparency in all our dealings.

The success of the company will be founded in its unflinching commitment to 5 core
values -- Integrity, Customer First, Boundary less, Ownership and Passion. Each of
the values describes what the company stands for, the qualities of our people and the
way we work. They do believe that they are on the threshold of an exciting new

39
opportunity, where we can play a significant role in redefining and reshaping the
sector.

CORE VALUES

The success of the company will be founded in its unflinching commitment to 5 core
values –

 Integrity
 Customer First
 Boundary less
 Ownership
 Passion.

Each of the values describe what the company stands for, the qualities of our people
and the way we work. We do believe that we are on the threshold of an exciting new
opportunity, where we can play a significant role in redefining and reshaping the
sector. Given the quality of our parentage and the commitment of our team, there are
no limits to our growth.

DISTRIBUTION

ICICI Prudential has one of the largest distribution networks amongst private life
insurers in India, having commenced operations in 74 cities and towns in India. The
company has seven banc assurance tie-ups, having agreements with ICICI Bank,
Federal Bank, South Indian Bank, Bank of India, Lord Krishna Bank and some co-
operative banks, as well as over 150 corporate agents and brokers. It has also tied up
with NGOs, MFIs and corporate for the distribution of rural policies and
organizations like Dhan for distribution of Salaam Zindagi, a policy for the socially
and economically underprivileged sections of society.
ICICI Prudential has recruited and trained over 60,000 insurance advisors to interface
with and advice customers. Further, it leverages its state-of-the-art IT infrastructure to
provide superior quality of service to customers.

40
 SUBDIVISION of ICICI GROUP

ICICI PRUDENTIAL
ICICI PRUDENTIAL MUTAL FUND
LIFE INSURANCE ICICI BANK

ICICI LOMBARD

BASIS OF SUBDIVISION

The subdivisions are made on the basis of services provided to the customers on basis
of there financial and securities needs. The details of the subdivisions are given below

ICICI BANK

History

ICICI Bank was originally promoted in 1994 by ICICI Limited, an Indian financial
institution, and was its wholly-owned subsidiary. ICICI was formed in 1955 at the
initiative of the World Bank, the Government of India and representatives of Indian
industry. The principal objective was to create a development financial institution for
providing medium-term and long-term project financing to Indian businesses. In the
1990s, ICICI transformed its business from a development financial institution
offering only project finance to a diversified financial services group offering a wide

41
variety of products and services, both directly and through a number of subsidiaries
and affiliates like ICICI Bank. 1999, ICICI become the first Indian company and the
first bank or financial institution from non-Japan Asia to be listed on the NYSE.

ICICI BANK in India

ICICI Bank is India's second-largest bank with total assets of about Rs. 2,513.89 bn
(US$ 56.3 bn) at March 31, 2009 and profit after tax of Rs. 25.40 bn (US$ 569 mn)
for the year ended March 31, 2009 (Rs. 20.05 bn (US$ 449 mn) for the year ended
March 31, 2005). ICICI Bank has a network of 741 branches (including 48 extension
counters) and over 3300 ATMs in India and presence in 30 International locations.
ICICI Bank offers a wide range of banking products and financial services to
corporate and retail customers through a variety of delivery channels and through its
specialized subsidiaries and affiliates in the areas of investment banking, life and non-
life insurance, venture capital and asset management. ICICI Bank set up its
international banking group in fiscal 2002 to cater to the cross border needs of clients
and leverage on its domestic banking strengths to offer products internationally.

ICICI Bank currently has subsidiaries in the United Kingdom, Russia and Canada,
branches in Singapore, Bahrain, Hong Kong, Sri Lanka and Dubai International
Finance Centre and representative offices in the United States, United Arab Emirates,
China, South Africa and Bangladesh. Our UK subsidiary has established a branch in
Belgium. ICICI Bank is the most valuable bank in India in terms of market
capitalization.

ICICI PRUDENTIAL Life Insurance

ICICI and Prudential came together in 1993 to form Prudential ICICI Asset
Management Company, which has today emerged as one of the leading mutual funds
in India. The two companies bring together two of the strongest financial service
brands in Asia, known for their professionalism, excellent quality of service and long
term commitment. Riding on the success of this relationship, the two companies
joined hands once more in 2000, to form ICICI Prudential Life Insurance, with a
commitment to provide leading edge life insurance solutions.

42
ICICI Bank has 74% stake in the company, and prudential plc has 26%.

ICICI Lombard

ICICI Lombard General Insurance Company Limited is a 74:26 joint venture between
ICICI Bank Limited and the Canada based $ 26 billion Fairfax Financial Holdings
Limited. ICICI Bank is India's second largest bank, while Fairfax Financial Holdings
is a diversified financial corporate engaged in general insurance, reinsurance,
insurance claims management and investment management. ICICI Lombard is India’s
largest non private firm which provide general insurance.

ICICI PRUDETIAL MUTAL FUND

ICICI PRUDENTIAL asset management company enjoys the strong parentage of

Prudential plc, one of the UK’s largest players in the insurance and fund management

Sectors and ICICI bank, a well known and trusted name in financial services in India.

ICICI prudential asset Management Company, in a span of just over eight years. has
forged a position of pre-eminence in Indian mutual fund industry as one of the largest
asset management companies in country with asset under management of Rs.
37,906.24 crores (as of march 31 st , 2007). The company manages a comprehensive
range of schemes to meet the varying investment needs of its investors spreads across

68 cities in the country.

43
 Organization Design and Structure

Chairman

Board of Directors

Managing Director

CFO CMO

Sales Channel
Acturial Head
Heads

Bank Assurance Tide Agencies

Group & Rural

Heads

RGSM

GSM

Key Account
Manager

Account Manager

Underwriting Head HR Head

Service &
Operations

44
 PRODUCT AND SERVICES

GROUP SOLUTION
In an era of competitive parity, the only asset that makes a decisive difference
between corporate success and failure is the quality of human capital. Employee
benefits have proven to be an excellent tool to optimize the retention of talent and
improve an organization’s bottom line. The quality of an organization’s employee
benefits establishes and maintains a company’s image as a caring employer. Optimum
care of employees is a long-term investment that results in a sustained competitive
advantage for an organization in the times to come.

ICICI Prudential Group Solutions Advantage

 An integrated basket of employee benefit solutions that offer incomparable

flexible benefits.
 Sound investment management that focuses on safety, stability and
profitability of the portfolio.
 Personalized financial planning for your employee that takes care of his/her
changing financial needs at every stage of life.
 Quality service initiatives and transparency across all operations, promising
superlative operational efficiency.

GROUP TERM ASSURANCE

The cover could be uniform or based on designation/rank or a multiple of salary, and

can be extended to all employees between the ages of 18 and 65 years. The benefit
under the policy is paid on the event of the member’s death to the beneficiary
nominated by the member. It is a one-year renewable policy where one master policy
covers all proposed employees comprising the group, with a minimum group size of
25 persons. New members can join the group and outgoing members can leave the
group at any point during the policy term.

FEATURES

 Greater convenience for the employees with relaxed underwriting and

medical requirements.

45
  “Free Cover Limits” with simplified underwriting depending upon the
number of employees in the group and the level of cover chosen.
 Guaranteed benefit: On death during the term of the contract (while in
service), the sum assured will be paid to the beneficiary of the employee.
 Choice of additional coverage in form an Accident and Disability Benefit
Rider and Critical Illness Cover
 Premium is viewed as a business expense in the year of payment.

ICICI PRUDENTIAL offer a flexible Group Term solution that provides benefits to
your employees by covering their lives against unfortunate incidents like death,
disability or disease. You can also provide cover to the extent of their liabilities such
as housing loans.

ELIGIBILITY
Group term plan covers:

• Group size of minimum 25

• from the minimum age of 18 till the maximum age of 65 or normal retirement age of
the employee, whichever is earlier excluding employees who have taken leave on
medical grounds for more than 7 days in the last one year.

EMPLOYER BENEFITS

 Attract and retain employees

 Provide welfare benefits to the employees and their families
 Have simple administration procedures
 Take optional riders at nominal cost
 Enjoy tax benefits
EMPLOYEE BENEFITS

 Have insurance protection at a relatively low cost

 Require no medical test (as per Free Cover Limit)
 Get covered 24 hours a day, 7 days a week, any where in the world.
 Enjoy conversation option to an individual policy
 Enjoy tax benefits.

46
BENEFITS PAYABLE
The benefit (life cover) under the policy is payable on the death of the employee to
the beneficiary nominated by him.

LIFE COVER DETAILS

The basic term cover can be chosen

 As a multiple of salary
 As a flat cover
 As a grade wise cover
 As a cover against outstanding loan amount
The minimum cover to be taken is Rs 100000 per employee.

ADDITIONAL COVERS
As riders to the basic plan for a nominal additional premium 3 additional covers are
offered against accident, disabilities and critical illnesses.

 ACCIDENT AND DISABILITY BENEFIT RIDER (ADBR)

On death due to accident caused by violent, external and visible means, the
sum assured under the rider will be paid. The maximum benefit that can be
availed of is equal to the basic sum assured to a maximum limit of Rs 10
lakhs.

In case of a death in a mass surface public transport, double the benefit will
be payable.

 ACCIDENTAL BENEFIT RIDER

On total and permanent disability due to accident, the sum assured under the
rider will be payable in ten annual installments, each equal to one tenth of the
amount of accidental cover. On death of such a member before the last such
installment, then the installments remaining unpaid shall become payable
immediately.

47
  CRITICAL ILLNESS RIDER
In the event of the life assured contracting a critical illness, an additional
payment equivalent of the sum assured under the rider would be made. The 9
major illness covered are:

Cancer, Coronary Artery By- Pass Graft Surgery (CABGS), Heart Attack, Major
Organ Transplant, Stroke, Paralysis, Aorta- Surgery, Heart Valve
Replacement/Surgery, Kidney Failure.

when employees join or leave the scheme?

• All new employees become a part of the group, if they meet the eligibility criteria.
The cover starts from the date of joining the company.

• The particulars of the new joinees are to be submitted by the Employer on a monthly
basis along with the proportionate premium.

• In case of an individual leaving service or the group, life cover will cease
immediately.

• The proportionate premium will be refunded for the employees leaving the scheme.

ICICI PRUDENTIAL GROUP RETIREMENT BENEFIT SOLUTIONS

GRATUITY - THE LOYALTY REWARD

Gratuity is a statutory benefit paid to the employees under the Payment Of Gratuity
Act, 1972 who have rendered continuous service for at least five years. The employee
is eligible for 15 days pay for each completed year of service. The employer can also
structure a gratuity that is higher than statutory requirements. It is payable on
cessation of employment (resignation/death/retirement/termination) by taking the last
drawn basic salary as the basis for calculation.

Gratuity payment liability tends to increase as the salaries and tenure of employment
increase annually. If the employer pays the gratuity from its current revenue, it
becomes difficult to meet the liability. It is therefore beneficial that a gratuity fund is
set up for prudent financial planning.

48
ICICI GROUP GRATUITY PLAN

ICICI Pru Life Insurance offers a market linked group gratuity plan that helps the
insured company to fund the statutory gratuity obligation in a scientific manner and
also avail of the tax benefits as applicable to approved gratuity funds.

FEATURES:

 Wider choice of investments with Market Linked Plans - to meet the

diverse financial goals. We offer 4 investment options (short-term debt, debt
and balanced and capital guarantee plan) where investments will be made in
accordance with the fund objectives.
 Transparency through Daily disclosure of Unit Value and regular disclosure
of the portfolio of each of the investment option
 Flexibility through switching and contribution redirection option to enable
reshuffling of portfolio.
 Bundled Life Cover greater value to the employee by packaging life
insurance cover with the gratuity, with minimal amount of underwriting.
 Actuarial services to provide a scientific estimation of the gratuity liability.
 Low explicit charge structure with the conditions for exit specified upfront.
 Enhanced service levels through faster claim settlement, easier access to
information and regular statements.
 Complete end to end solution in the legal and regulatory approval process
for scheme set up or transfer.

ELIGIBILITY
Group Gratuity Plan covers

• employer- employee groups.

• group size of 25 and above

• employees (members) between the age of 18 and retirement age of the

company

49
Employer Benefits:

 Annual contribution up to 8.33% of salary bill in a financial year is allowed a

deduction for the purpose of computation of profits and gains of business.
 Contribution towards past service liability is allowed as deduction as per the
Income Tax rules.

Employee Benefits:

 The contribution made by the employer is not included in the value of taxable
perquisites in the hands of the employee.
 Gratuity received up to Rs 350000 is exempt from Income tax under Sec
10(10).
BUNDLED LIFE COVER

ICICI Prudential Gratuity Plan offers greater value to the employees by packaging
gratuity with life insurance. It can be taken:

 As a flat cover which can be a minimum of Rs 1000 per employee, or

 On the basis of anticipated gratuity which is the amount paid over and above
the accrued gratuity of an employee in the event of his premature death before
retirement age, for the balance years of his service.
 The premiums for the bundled life cover are payable annually in advance.

CONTRIBUTIONS

The contributions made towards the Gratuity liability will depend on the Actuarial
Valuation. You can estimate your gratuity liability based on an actuarial valuation
provided by a qualified actuary. As part of our value added services, we provide an
AS-15 Certification for the same. The Past Service Gratuity Liability payment can be
made over a period of five years. The annual contributions can be made in annually/
quarterly/monthly installments.

50
PRODUCT OFFER

ICICI Prudential offers a market linked plan that offers a higher flexibility and
transparency than any other traditional or self-administered fund. It offers 4 fund
options under the Group Gratuity Plan to meet the employee’s diverse financial goals.
The investments are made in accordance with the fund objectives.

FUND ASSET ALLOCATION OBJECTIVE

OPTION
Short Term Debt 100% Money Market, Protect capital deployed, as well as
Plan Debt Instruments provide suitable returns through low
risk investments debt and money
market instruments

Debt Plan Max 100% Debt Generate a steady accumulation of

Instruments; Max 25% income through instrument in fixed
Money Market income securities.

Balanced Plan Min 80% debt and debt Generate a good mix of long-term
related instruments; Max capital appreciation along with
20% Equity current income through investment in
equity and fixed income instruments.

Capital 100% Money Market, Provide suitable returns through low

Guarantee Plan Debt Instruments. risk investments in debt and money
market instruments while protecting
contributions invested in this plan.

VALUE ADDED SERVICES

 Dedicated account manager.
 Settle claims and payouts within specified turn around times.
 Assistance in setting up of a new trust and transfer of existing schemes.
 Legal and taxation help desk for gratuity fund.
 Financial planning for employees.

51
when employees join or leave the scheme?

• All new employees become a part of the group, if they meet the eligibility criteria.
The life cover starts from the date of joining the company.

• The particulars of the new employees may be submitted by the Employer on a

monthly basis. The term premiums are payable annually in advance (on a pro-rata
basis) and the annual contribution can be paid in the specified instalments.

• In case of an individual leaving service or the group, life cover will cease
immediately.

• The proportionate premium will be refunded for the employees leaving the scheme,
except in case of death. The gratuity accrued will be paid to the employee if eligible.

• For all death claims the life cover along with the accrued gratuity will be payable to
the employee’s beneficiary.

RETIREMENT PLANNING WITH GROUP SUPERANNUATION

After a valuable professional career with an organization, employees require the

security of a regular income flow when they retire. Organizations help employees
secure there golden years by offering various kinds of retirement benefits that allow
an employee to enjoy the same quality of life post retirement. Group Superannuation
is one such efficient way to plan for retirement.

ICICI Prudential GROUP SUPERANNUATION PLAN

ICICI Prudential offers a market linked defined contribution Superannuation scheme
that provides substantial benefits to both employers and their employees. The
employer can avail of tax benefits applicable to an approved Superannuation trust.
The scheme will provide for a retirement fund of each member. A member would be
able to choose from various pension options or opt for partial commutations of the
pension at the time of retirement.

52
FEATURES

 Wider choice of investments with Market Linked Plans - to meet the

diverse financial goals. We offer 5 investment options (short-term debt,
debt, balanced, growth and capital guarantee plan) where investments will
be made in accordance with the fund objectives.
 Control - Each member/employer can exercise greater control over
investments by choosing one or more of the investment options.
 Multiple Annuity Options - 5 annuity options and open market option.
 Transparency - Transparency through Daily disclosure of Unit Value and
regular disclosure of the portfolio of each of the investment option.
 Flexibility - Flexibility through switching and contribution redirection option
to enable reshuffling of portfolio.
 Low explicit charge structure with conditions for exit specified upfront.
 Enhanced service levels through faster claim settlement, easier access to
information and regular statements.
 Complete end-to-end solution in the legal and regulatory approval
process for scheme set up or transfer.

ELIGIBILITY

ICICI Prudential‘s Group Superannuation Plan covers

• Employer- employee groups.

• Group size of 25 and above

• Employees (members) between the age of 18 and retirement age of the company .

EMPLOYER BENEFITS

 Annual contribution are treated as deductible business expenses u/s 36(1)(iv)

 Maximum contribution that an employer can make is 27% (provident fund+
superannuation) of employee’s annual salary –rule 87
 Interest income on the fund is tax-free 10(25)(3)

53
EMPLOYEE BENEFITS

 Contributions by the employer are not treated as perquisites u/s 17(2)

 Interest on the fund is exempt from tax u/s 10(25)(iii)
 Commuted value (1/3rd )on retirement is tax-free u/s 10(13)
 Benefits payables on death are exempt from tax u/s 10(13)
 Employee’s contribution, if any, qualifies for tax exemption u/s 88

Superannuation Benefits payable:

On Retirement
On retirement the trustees/individual member would be able to choose from different
annuity options then available. A portion of the accumulated amount may be
commuted for payment of lump sum on retirement etc., subject to the provisions of
the scheme rules and the provisions of Income Tax rules.

On Death
In the event of death of the employee, the accumulated amount will be used for
payment of benefits to the beneficiary as per the rules of the scheme.

On Withdrawal
In the event of leaving service of an employer, the employee has the option to either
transfer the money to an approved superannuation fund of the new employer or opt
for a deferred pension plan. All these will be subject to the provisions of the rules of
the scheme, approval of the Income Tax authorities and appropriate deduction of tax
at source, wherever applicable.

BENEFITS PAYABLE

Superannuation benefits are payable on retirement, death and resignation. In either

case, the accumulated amount is used for making payments to the member or
beneficiary (in case of death), subject to the provisions of the scheme rules and the
provisions of income tax rules.

54
CONTRIBUTIONS
 Contributions can be made by employers only or by both employer and
employee
 Contribution is defined as a % of salary of the employees (e.g. 15% basic for
defined contribution schemes. For defined benefit schemes it is dependent on
the funding requirement as per the actuarial valuation conducted)

PRODUCT OFFERING

ICICI Prudential offers a market linked plan to meet the diverse financial goals of the
employer and the employees. The plan offers 5 fund options under the scheme.

FUND OPTIONS ASSET ALLOCTATION OBJECTIVE

Short term debt plan 100% money market, debt Provide suitable returns
instruments. through low risk investments
debt and money market
instruments while attempting
to protect the capital deployed
in the fund.

Debt Plan Max 100% Debt Instruments; Generate a steady

Max 25% Money Market accumulation of income
through instrument in fixed
income securities.

Balanced Plan Min 80% debt and debt Generate a good mix of long-
related instruments; Max 20% term capital appreciation along
Equity with current income through
investment in equity and fixed
income instruments.

Growth Plan Min 40% debt and debt Provide long term capital
related instruments; max 20% appriciation through
equity investments primarily in
equity and related instruments.

55
Capital Guarantee Min 80% debt and debt Generate a good mix of long-
Plan related instruments ; max term capital appriciation along
20% equity with current income through
investment in equity and fixed
income instruments while
protecting the contributions
invested in the plan.

56
 CHAPTER 3
RESEARCH METHODOLOGY

57
 RESEARCH METHODOLOGY

Research Objective

i. To study the different strategy opt by the Reliance Life Insurance and the
ICICI prudential.
ii. To analyze the strategic goal map of the organization to sustain the value.

Research Design

Data has been collected through one to one interaction and discussion with various
people who are involved in the business of insurance as Sales manager, Life Advisors,
Marketing Manager Ceustomers and others. Newspapers, Internet, Magazines and
Journals would provide ample material about latest trends and practices in insurance
industry. Kotak organizes various outdoor activities to boost its business and brand.
Interaction with customers during such outdoor activities would enable to understand
the success ratio of such kind of outdoor activities. Various products of the company
would be discussed with respect to their benefits and advantages. Various insurance
players would be compared with respect to their market share and products that they
offer.

Primary Data has been collected through discussions and observation of various
people involved in the business whereas Secondary Data through annual reports of
the company, newspaper, magazines, journals and internet.

Questionnaire Design/ Formulation

I have done research on the different customer parameter to develop the questionnaire

keeping the Reliance and the ICICI in the mind.

Sampling Methodology

Sample Element/ Sample Unit

100 people would take for this report

58
 Sampling Extent

Delhi and NCR

Time Frame

15 – 20 days.

Sampling Technique

Sampling chosen with the Random method

Sample Size

100 people would take for this report

Limitation

Only Delhi & NCR region covered for this report because of not availability of time

and resource. Also for financial disclosure company are not sharing more internal

information either on internet or ready to give.

59
 CHAPTER 4
DATA ANALYSIS &
INTERPRETATIONS

60
 DATA ANALYSIS & INTERPRETATIONS

 DATA GIVES PREFERENCE OF RESPONDENTS OF INSURANCE

COMPANIES

NO.OF
COMPANY’S NAME SHARE (%)
RESPONDENT

L.I.C. 78 78

RELIANCE Life Insurance 3 3

ICICI PRUDENTIAL 10 10

SBI LIFE 7 7

HDFC 2 2

TOTAL 100 100

10 7
LIC
3
REL
ICICI
SBI
HDFC
78

INTERPRETATION

 78% of the people contacted prefer LIC policy to any other and therefore it is
ranked no.1 by that percent of respondents.

61
 DATA GIVES BENEFITS OF INSURANCE PERCEIVED BY
RESPONDENTS

NO.OF
BENEFITS SHARE (%)
RESPONDENTS

Cover Future Uncertainty 55 55

Tax Deductions 20 20

Future Investment 25 25

TOTAL 100 100

Future
Investment
25%

Cover Future
Uncertainty
55%
Tax Deductions
20%

INTERPRETATION

 55% of the respondents believe that covering future uncertainty is the biggest
benefit of an insurance policy.

 Whereas, 20% and 25% of them believe that the other benefits are Tax
deduction and future investments respectively.

62
 DATA PROVIDES FEATURES OF INSURANCE POLICY THAT
ATTRACTED RESPONDENTS

FEATURE NO.OF SHARE (%)

RESPONDENTS

Money Back Guarantee 15 15

Larger Risk Coverance 37 37

Easy Access to Agents 7 7

Low Premium 30 30

Company’s Reputation 11 11

TOTAL 100 100

FEATURES OF INSURANCE POLICY

REPUTATION MONEY BACK

OF COMPANY GUAARENTEE
11% 15%

LOW PREMIUM
30%

LARGER RISK
EASY ACCESS COVERANCE
TO AGENTS 37%
7%

INTERPRETATION

 Majority of the respondent (37%) found Larger risk coverance as the most
attracted feature of the all.

63
 DATA PROVIDES NUMBER OF INSURANCE POLICY TYPE
RESPONDENTS

POLICY TYPE NO. OF SHARE (%)

RESPONDENTS

LIFE POLICY 75 75

NON LIFE POLICY 25 25

BOTH 45 45

NATURE OF POLICY

BOTH
31%

LIFE POLICY
52%

NON LIFE POLICY

17%

INTERPRETATION

 75% of the respondents have Life Insurance Policy while 45% have both. (The %
is calculated out of 280 positive response)

64
 DATA GIVES PEOPLE PERCEPTION ABOUT INSURANCE

RESPONSE NO. OF SHARE (%)

RESPONDENTS

A saving tool 81 81%

A tax saving device 74 74%

A tool to protect your family 100 100%

0% 0%
0%

FAMILY SAVING TOOL

PROTECTION 32%
39%

TAX SAVING TOOL

29%

INTERPRETATION

 81% of the respondents have perception of Insurance being a saving tool.

 And 74% of the respondents have perception of Insurance being a tax saving
device.

 But 100% of the respondents are with the view that Insurance is a tool to protect
your family.

65
 DATA SHOWS PEOPLES HAVING INSURANCE

RESPONSE NO. OF SHARE (%)

RESPONDENTS

Yes 70 70%

No 30 30%

Total 100 100%

No
30%

Yes
70%

INTERPRETATION

 Of the sample size of 400 surveyed respondents 70% of the respondents are
having Insurance policy.

 30% of the respondents are either not having any Insurance policy at present or
their policy is already matured.

 And at present 100% of the respondents are with the view that Insurance is a tool
to protect your family.

66
 DATA SHOWS BUYING PROCESS OF THE PEOPLE

BUYING PROCESS NO. OF SHARE (%)

RESPONDENTS

Customer approached Insurance 45 45%

company/Agent

Company/agent approached 55 555

customer

Total 100 100%

Customer
approached
Insurance
company/Agent
44%

Company/agent
approached
customer
56%

INTERPRETATION

 44.5% of the respondents approached the Insurance Company / Agent.

 Whereas, 55.5% of the respondents were approached by the Company /Agent.

67
 DATA SHOWS REASONS BEHIND FOR INSURANCE

RESPONSE NO. OF SHARE (%)

RESPONDENTS

Tax saving 80 80%

Saving / Investment 80 80.%

Family protection 100 100%

Tax saving

31%
38%

31%

INTERPRETATION

 80.71% of the Respondents opted for Insurance for tax saving benefits.

 80.71% of the Respondents opted for saving / Investments.

 But all of them, i.e. 100% of the respondents have opted for insurance for their
family protection.

68
 DATA SHOWS SATISFACTION OF RESPONDENTS WITH RESPECT
TO POLICY

RESPONSE NO. OF SHARE (%)

RESPONDENTS

Satisfied 60 60%

Not satisfied 40 40%

Not Responded 0 0.0%

Total 100 100%

Not Responded
0%

Not satisfied
40%
Satisfied
60%

INTERPRETATION

 60% of the respondents are more or less satisfied with their existing policy.

 40% of the respondents are not satisfied with their existing policy.

 In this case all of those who have taken a policy have responded.

69
 DATA SHOWS SATISFACTION OF +RESPONDENTS WITH RESPECT
TO SERVICE AGENT

RESPONSE NO. OF SHARE (%)

RESPONDENTS

Satisfied 45 45%

Not satisfied 55 55%

Not Responded 0 0.0%

Total 100 100%

Satisfied
45.00%
Not satisfied
55.00%

INTERPRETATION

 45% of the respondents are satisfied with their existing service agent.

 55% of the respondents are not satisfied with their existing insurance agent.

 All of those who have taken a policy have responded.

70
 DATA SHOWS NUMBER OF RESPONDENTS PAYING TAX

RESPONSE NO. OF SHARE (%)

RESPONDENTS

Paying tax 100 100%

Not paying tax - 0%

Total 100 100%

Not paying tax

0%

Paying tax
100%

INTERPRETATION

 Of the sample size of 400 respondents, all the respondents are paying tax.

71
 DATA SHOWS RESPONDENT’S INVESTMENTS FOR TAX SAVING

INVESTMENTS NO. OF SHARE (%)

RESPONDENTS

LIC 51 51%

NSC 33 33%

Bonds 32 32%

PPF 25 25%

PF 21 21%

EPF 11 11%

LIC

EPF
PF 6%
LIC
12%
30%

PPF
14%

NSC
BOND
19%
19%

INTERPRETATION

 51% of the respondents save their tax by investing in LIC, which is the highest
among all Investment. This shows that most people for getting taxes benefits
invest in LIC.

 33.25% of the respondents do their tax saving by investing in NSC.

 32.25% of the respondents to their tax saving by investing in bonds.

72
 DATA SHOWS RESPONDENTS PERCEPTION ABOUT BEST FORM OF
INVESTMENT FOR SECURING THEIR FUTURE

NO. OF SHARE (%)

RESPONDENTS

Fixed Assets 75 75%

Bank deposits 11 11%

Jewellery 25 25%

Securities i.e. bonds, MFs 40. 40%

Shares 10 10%

Insurance 70 70%

Fixed Assets
Insurance
30%
Fixed
Assets
33%

Securities i.e. Shares

bonds, MFs 4% Cash & Bank deposits
17% Jewellery 5%
11%

INTERPRETATION

 75.25% of the respondents as with the view that Fixed Assets is the best form of
investment for securing their future.

 70.5% of the respondents are with the perception that Insurance is the best form
of investment for securing their future, which is one of the highest and this shows
that insurance is an important key for securing your future.

73
 DATA SHOWS WHAT PEOPLE INTENT TO GAIN FROM THEIR
INVESTMENT

RESPONSE NO. OF SHARE (%)

RESPONDENTS

Saving & Returns 100 100%

Security 90 90%

Tax benefits 71. 71.%

Saving & Returns

Tax benefits
27% Saving & Returns
38%

Security
35%

INTERPRETATION

 100% of the respondents intent to gain saving and returns from their investment.

 90% of the respondent’s intent to gain security from their investments.

 Whereas, 71.75% of the respondent’s intent to gain tax benefits from their
investments.

74
 DATA GIVES PEOPLE’S PERCEPTION ON APPROPRIATE AGE FOR
BUYING INSURANCE

RESPONSE NO. OF SHARE (%)

RESPONDENTS

After 25 years 29 29%

After 35 years 10 10%

After 45 years 0 0%

Anytime 60 60%

After 25 years
29%

Anytime
60.61%

After 35 years
10.10%
After 45 years
0%

INTERPRETATION

 29% of the respondents are with the view that insurance should be bought after
the age of 25 years.

 10.5% of the respondents are with the view that insurance should be buyed after
the age of 35 years.

 Whereas, 60.5% of the respondents are with the view that buying of insurance do
not have any thing to do with age i.e. there is no age limitations. It can be
purchased any time according to the need.

75
 DATA SHOWS PEOPLE OPINION ABOUT INDIAN INSURANCE
COMPANIES

RESPONSE NO. OF SHARE (%)

RESPONDENTS

Rigid plans 67 67%

Non user friendly 29 29%

Unsatisfactory services 26 26%

Non Aggressive 35 35%

Satisfactory 24 24%

Good 10 10%

Very good 0 0%

Good Very good

5% 0%
Satisfactory
13%
Inflexible plans
35%
Non Aggressive
18%

Unsatisfactory Non user friendly

services 15%
14%

INTERPRETATION

 67% of the respondents have the opinion that Indian Insurance Companies have
Rigid plans.

76
 29.5% feel that Indian Insurance companies are Non-user friendly.

 26.5% feel that services of Indian Insurance companies are Unsatisfactory.

 35.75% of the respondents are with the view that Indian Insurance companies are
Non-aggressive.

 24% of the respondents feel that products and services of Indian Insurance
companies is Satisfactory.

 Whereas only 10.25% feel that it is Good enough.

And according to the data, no single person has felt that it is very good.

77
 CHAPTER 5

CONCLUSIONS/ FINDINGS

78
 CONCLUSIONS/ FINDINGS

Our exhaustive research in the field of Life Insurance threw up some interesting
trends which can be seen in the above analysis. A general impression that we gathered
during Data collection was the immense awareness and knowledge among people
about various companies and their insurance products. People are beginning to look
beyond LIC for their insurance needs and are willing to trust private players with their
hard earned money.

People in general have been impression by the marketing and advertising campaigns
of insurance companies. A high penetration of print , radio and Television ad
campaigns over the years is beginning to have it’s impact now.

The general satisfaction levels among public with regards to policy and agents still
requires improvement. But therein lays the opportunity for a relative new comer like
ING. LIC has never been known for prompt service or customer oriented methods and
Reliance can build on these factors.

79
 CHAPTER 6
RECOMMENDATION

80
RECOMMENDATION

 According the survey only 42% people are insured in Delhi so reaming
other part is potential for insurance sector.

 Among that 42% people who having insurance, they have insurance
40% for self 28%for spouse 21% for children and 18% for their
parents and 11% for all family member, also its very help full for
insurance sector so they should take necessary step for capture this
potential.

 Only 42% people having insurance in Alwar in that 42% there are 82
% people are under insured and other 18% people are fully insured
according to their income so that is also plus point for insurance sector
to capture the market

81
CHAPTER 7

82
 BIBLIOGRAPHY

a) Books

1. Gumber A., Kulkarni V. 2000. Health Insurance for Informal Sector: Case Study of

Gujarat. Economic and Political Weekly

2. Dholakia R. Economic reforms: Implications for Health Insurance. Presentation at

3. One day workshop on 'Health Insurance in India'. Indian Institute of Management,

Ahmedabad.

b) Journal

Harvard Business Review

IRDA

c) Magazine

Insured India.

d) Internet

i. Sites

www.reliancelifeinsurace.com

www.IRDA.in

ii. Search Engines

www.google.co.in

83
 ANNEXURE
F

1. DO YOU HAVE ANY INSURANCE POLICY?

YES NO

2. WHICH INSURANCE POLICY DO YOU HAVE?

LIFE NON-LIFE BOTH

3. WHICH CO’S INSURANCE POLICY YOU PREFER THE MOST?

(RANK THEM)

a) LIC

b) ICICIPRUDENTIAL

c) SBI HEALTH INSURANCE

d) ING VYSYA LIFE

e) RELIANCE HEALTH INSURANCE

f) TATA AIG LIFE

g) ANY OTHER ________( Specify)

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4. FOR HOW MANY YEARS DO YOU HAVE INSURANCE POLICY?
(Please Tick)

a) <5Yrs b) 5-10 Yrs c) 10-15 Yrs d) Any Other______

(Specify)

5. WHAT DO YOU THINK ARE THE BENEFITS OF INSURANCE COVER?

(RANK THEM)

a) COVER FUTURE UNCERTAINITY

b) TAX DEDUCTIONS

c) FUTURE INVESTMENT

d) ANY OTHER _________ (Specify)

6. WHICH FEATURE OF YOUR POLICY ATTRACTED YOU TO BUY IT?

(RANK THEM)

a) LOW PREMIUM

b) LARGER RISK COVERANCE

c) MONEY BACK GUARNTEE

d) REPUTATION OF COMPANY

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 e) EASY ACCESS TO AGENTS

f) ANY OTHER _________ (Specify)

8. YOUR MONTHLY INCOME?

a)<4k b)4k-8k c)8k-12k d)12k-16k e)Other_____(Specify)

9. DO YOU REALLY THINK INSURANCE POLICY COVER IN TODAY’S

SCENARIO IS NOT ESSENTIAL?

_____________________________________________________

10. WHAT’S YOUR PERCEPTION ABOUT INSURANCE?

(RANK THEM)

a) A SAVING TOOL

b) A TAX SAVING DEVICE

c) A TOOL TO PROTECT FUTURE

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