Amol Bakshi Tejas Badheka

Swapnil Gharat Sachin Gupta

Dhanashree Kitukale Advait Khadse
Nihaal Jelkie Rohan Pai
Ajita Ranade Mayuresh Sanap
Vikram Joshi Prafull Thakur

Group No. 6 JBIMS Marketing presentation

 Indias insurance sector is expected to grow even faster than
the countrys overall economic growth, opening up new
business avenues across the industry
Growth Factors in Indian Insurance Industry -

Low life insurance penetration rate

Rising awareness of the need of insurance

Favourable foreign investment policies

Increased capital raising options

Group No. 6 JBIMS Marketing presentation

Product Development Strategy
Retirement Plan to target growing middle age segment
Platinum plan to target HNIs
Students plan to target increasing category of students going abroad for education

Objective
To understand the current market

A quantum leap in growth rate from 20% to 50%

Increase in the customer base growth by 50%

Group No. 6 JBIMS Marketing presentation

 Industry growing at 19-20% GDP contribution 4%
Penetration in Urban Area 65% Rural Area 40%
Total Market Premium - $80 billion
Opportunities
Key Challenges Rising income levels
Low interest rates

Strengthening core product

Less training for agents proposition

Tax challenges Opportunity in health and

pensions

Group No. 6 JBIMS Marketing presentation

 Term Whole Life Single Premium Endowment

- Lump sum is paid

- Provides life - Provides guaranteed - Requires insured to after a specified sum
insurance coverage for insurance protection pay a one-time or on death
a specified term for the entire life premium - More expensive than
- Does not accumulate - Higher premiums - Companies charge a whole life and
cash value than term insurance large amount if insured universal
- 3 key factors - Carry tax deferred takes out money out - Cumulative cash
1. Face Amount cash value component during first few years value of policy equals
- Advantages - Insured may take a death benefit
2.Premium to be paid
1. Guaranteed death loan against this policy - Common Types
3. Length of coverage
benefits and cash 1. Traditional with
- Common types value profits
1. Annual Renewable 2. Fixed, predictable 2. Unit-linked
term annual premiums
3.Full
2. Level Term 3. Mortality expense
charges 4. Low-Cost
3. Decreasing Term
- Disadvantages
1. Inflexibility of
premiums
2. Not competitive IRR

Group No. 6 JBIMS Marketing presentation

 IRDA is the controlling and regulatory apex body in the country for
insurance sector and its chairman and members are appointed by
Government of India

Duties, Powers and Functions of IRDA

Code of
Efficiency Fees Registration Protection
conduct

Terms of Books of
Qualification Information
business accounts

Group No. 6 JBIMS Marketing presentation

 Propose a regulation strategy of bundling multiple insurance
products together

Term Plan + Health Plan

Health plan takes care of you when you are still alive. Term Plan
takes care of your loved ones after you die

Term plan + Retirement Plan

Retirement insurance ensures that you or your family members
receive a regular pension amount post a retirement date

The combo products will help to increase the penetration of

multiple insurance products

Group No. 6 JBIMS Marketing presentation

Group No. 6 JBIMS Marketing presentation
 Insurance penetration is defined
as the ratio of total premium
collected to the total Gross
Domestic Product (GDP) of an
economy

Insurance density is defined as

the ratio of total premium to the
total population in the country
and is expressed in currency units

Group No. 6 JBIMS Marketing presentation

 Indias largest and most popular Insurance Company
Has gained consumer trust and credibility over time

Insurance provider with the most reliable brand names

Has plans for children to students to corporate executives to
senior citizens
First to introduce a 24x7 dedicated, toll free customer line

Indias most trusted private sector insurance provider

First insurance company to receive a National Insurer Financial
Strength of rating AAA

Group No. 6 JBIMS Marketing presentation

 An insurance provider with the highest financial strength
First private sector insurance provider to make highest profit for
3 consecutive years since 2007
Offers plans for segments from urban to mid urban to rural
divisions

Indias first insurance provider with business continuity plan

Model is based on disaster management principles

The master of group solution insurance plans

Specializes in offering a wide range of solutions for groups and
individuals

Group No. 6 JBIMS Marketing presentation

 LIC Private
Regular Premium 64.60% 35.40%
Single Premium 80.50% 19.40%
Renewal Premium 69.90% 30.10%
Total Premium 70.70% 29.30%
[1pp] [-1pp]

New Policies count 357 lakh 84.4 lakh

[-3.5%] [-24%]

Reinsurance premium ceded Rs 85 Cr. Rs 679 Cr.

[-22%] [34%]
Operating ratio [operations, training to develop distribution channels, capital req.
under solvency margin] 7.35% 17.53%
[-1pp] [-.5pp]

Claims Settled 97.42% 89.30%

11546 1251
No. of Micro insurance agents [Lives covered 1.02 Cr.] 800:1
All except
Penalty levied by IRDA for failure to follow guidelines No HDFC

Group No. 6 JBIMS Marketing presentation

Group No. 6 JBIMS Marketing presentation
Group No. 6 JBIMS Marketing presentation
 LIC ICICI HDFC SBI MAXLIFE

Total Insurance Premium 202889 Cr. 14021 Cr. 10202 Cr. 13133 Cr. 6390 Cr.

Individual Biz.

From Agents 41266 1375 582 1730 640

Banks 1098 1132 1869 1485 690

Others 92 157 188 46 226

Brokers 17 168 134 81 26

Direct Selling 264 218 129 2 127

Group Biz.

From Agents 1712 250.4 2.02 141.7 1.93

Banks 139.6 - 2.47 1861.55 -

Others 9 261.43 1.84 13.5 -

Brokers 25.7 2.53 18.6 5.3 7.65

Direct Selling 37167 875.24 905.4 1165.95 184.5

Group No. 6 JBIMS Marketing presentation

 24 registered life insurers
Insurance provider Market Share
LIC India 63.47
ICICI Prudential 5.88
HDFC Standard 5.66
SBI Life 4.4
Max-Network 3.14
Bajaj-Allianz 2.73
Birla-Sun life 2.46
Reliance-Life 2.3
TATA-AIG 1.27
ING-Vysya 1.27
MetLife 1.05
Aviva 1.02
Canara-HSBC-OBC 0.99
Kotak-Mahindra 0.99
Bharti Axa Life 0.41
Others 2.96

NEW PARADIGMS Private bank led insurers have fared much better than insurers dependent on
agency distribution in volumes
Innovative products Overall ticket sizes have remained flat for private insurers but bank led
Smart marketing insurers have done better with growth in average ticket sizes aiding overall
Aggressive distribution volumes
Low margin single premium products have fuelled growth in past, although
easier to sell they impair long term profitability

Group No. 6 JBIMS Marketing presentation

Term Plans

Children's Plans

Retirement Plans

Savings & Investment Plans

Health Plans

Group No. 6 JBIMS Marketing presentation

 Term Plans Children's Retirement Savings & Health Plans
Plans Plans Investment
Plans
Plan Safeguarding Economic Monetary Dual benefit Securing
Details family's financial support and security and of protection health costs
independence funding major financial and long and financial
and security milestones independence term savings independenc
against such as even after e despite
uncertainties education retirement illnesses

HDFC 1. Term 1. Children's Personal 1. Money 1. HDFC

Offerin Assurance Plan Pension Plan Back Plan Critical
gs Plan 2. Young Star 2. Endowm Care Plan
2. Premium Super II ent 2. HDFC
Guarantee Assuranc SurgiCare
Plan e Plan Plan

Group No. 6 JBIMS Marketing presentation

Group No. 6 JBIMS Marketing presentation
 Strong Presence across India:

481 branches
5000+ partner branches
3,000 Front Line Sales (FLS)
serving partner bank branches

Group No. 6 JBIMS Marketing presentation

Group No. 6 JBIMS Marketing presentation
 No insurance companies are providing risk
Tapping the ones at the management & insurance services to this
bottom of pyramid I.e particular segment
Extreme niche clientele

The Three Currently all the consumers are focusing on

Increasing the base of
pronged the Urban Middle & this has led to over
current target audience
concentration of this market
Pyramid
Strategy

Exploiting the opportunity of

The retirement needs of this age group is not
middle age group [30-50 yrs]
being met by proper value proposition by
current products

Group No. 6 JBIMS Marketing presentation

 World Bank Report says
the rural population in
India is 83.3 crores.
Insurance Penetration
slipped to 4.1 %

Group No. 6 JBIMS Marketing presentation

 The Three pronged Pyramid Strategy

To be launched in phase To be launched in phase To be launched in phase

one Two Three
Focuses on students going Extremely high end Allows us to tap the
abroad consumers wealth of rising middle
It allows us to bundle We sell customized income group
other Portfolio companies structured insurance We sell retirement plan
of HDFC argo products products
This allows us to earn It allows us increase our They are products sold at
extra revenue through premium per policy Annual pemium of less
earning commission The mortality cost is very then Rs 2000
income less in the product

Phase wise implementation allows us quantum growth in next four years

Group No. 6 JBIMS Marketing presentation

 Current lagging of Indian education scenario
Emerging middle class considers education as the best inheritance that they
can provide
Thus no compromise on education of child
Increase aspiration to have global exposure & education

Growth rate of indian economy

Growing breed of HNIs
Also need to sustain the same lifestyle for family
Want of customized, discreet financial service, thus we calculate an plan
Need for an extremely niche product with special benefit services which
allows them to differentiate

Increased banking penetration

Increased size of middle age & middle class income segment
Various government schemes related to tax benefits
Aadhar drive initiated by government

Group No. 6 JBIMS Marketing presentation

 Can be sold through existing channels distribution through agents and banks
Can be sold through various education consultant & travel agents
We can tap the current HDFC channel of education loans called Credila
Once Successful we can then later implement the same to localloans

Need to create a separate professional channels

Can be sold through high end CFP & wealth management channels
Can be sold to various corporate banking clients
We can tap the current HDFC channel of wealth management and Imperia
Banking

Banking correspondence
Leverage the highly technosavy IT networks
Can be sold through other large network of HDFC banks which have high
lending exposure
Developing a new force of Agents to sell the insurance products

Group No. 6 JBIMS Marketing presentation

Group No. 6 JBIMS Marketing presentation
 Step 1 : Identifying the Target Audiences

Student Age group 15 30 and their parents

Insurance Individuals looking to seek degrees abroad

HNI People with high earning potential

Insurance Top management and heads of organizations

Retirement
Plan People with middle Age group [30-50 years]
(Jeevan People from private sectors
Aadhar)

Group No. 6 JBIMS Marketing presentation

 Step 2 : Determining Communication
Objectives
Attention Interest Desire Action

Student Celebrity Offered with

Catchy Advertising Int.. Sales Points
Insurance Endorsements application forms

HNI Direct Sales

Elite and Gold club Relationship
Insurance exclusivity members managers

Retirement
Plan Emotional Future security
Personal Selling Sales points
(Jeevan Advertising advertisements
Aadhar)

Group No. 6 JBIMS Marketing presentation

 Step 3 : Designing a Message
Content Structure Format Sources

Student Rational Appeal / Emotional Appeal

Insurance Makes students feel responsible
Celebrity Endorsement

Rational Appeal
HNI
Custom structure and format
Insurance
Through a personal relationship manager

Retirement
Emotional Appeal
Plan
Concentrates on future planning
(Jeevan
Through reliable institutions
Aadhar)

Group No. 6 JBIMS Marketing presentation

 Step 4 : Selecting Communication
Channels
Television
Student Educational Institutes
Insurance Educational Consultancies
Banks for loans

HNI Personal Relationship Managers

Insurance Print Advertisements

Retirement
Boards, hoardings
Plan
Banks
(Jeevan
Television
Aadhar)

Group No. 6 JBIMS Marketing presentation

 Step 5 : Establishing Marketing
Communications Budget
As a percent of sales :
Student
Insurance 4

As a percent of sales
HNI
Insurance 1
Retirement
As a percent of sales
Plan
(Jeevan
Aadhar)
9

Group No. 6 JBIMS Marketing presentation

 Step 6 : Developing and Managing
marketing communications mix
Advertising
Student
Personal Selling
Insurance
Direct Marketing

HNI Advertising
Insurance Direct Marketing

Retirement Advertising
Plan Personal Selling
(Jeevan Direct Marketing
Aadhar)

Group No. 6 JBIMS Marketing presentation

 Step 7 & 8 : Measure results and
Manage
Student Compare YoY growth with revenue targets
Insurance Extend market research opportunities and control

HNI Compare sales with revenue targets

Insurance Engage profit sharing model with relationship managers

Retirement
Compare sustained YoY growth with revenue targets
Plan (Jeevan
Engage more sales force
Aadhar)

Group No. 6 JBIMS Marketing presentation

Current motto of HDFC life insurance is Sar utha ke jiyo!

Conveys the idea of living your life with dignity and self
respect

The idea of self respect connects strongly to each of the

current segments

For students going abroad, the insurance will insure the

students against uncertainties
In case of HNIs, the insurance will allow the family members
to live a lavish lifestyle

Group No. 6 JBIMS Marketing presentation

Operating Expenses/Total Premium decreasing from 18.7% to 12.2% over a period of
three years.

Group No. 6 JBIMS Marketing presentation

Assumptions: Major
Major Costs
Costs Major Revenue Streams
10% of Students Higher Commissions Retirement Plans
and 1% HNIs go for for HNI Business
our products initially Operating Expenses in
growing Students and HNIs
incrementally Products

Change in PBT Total Income (Million Rs)

100 900000
80 750000
600000 Total
60 450000
Change in Income
40 300000
PBT 150000 (Million
20 0
0 Rs)
2014 15 16 17 18

Group No. 6 JBIMS Marketing presentation