promotional strategy in life insurance companies

Sales Improvement on Life Insurance Policies

INTRODUCTION

Introduction of Life Insurance

Life insurance is designed to protect life and to product family against

financial uncertainties that may result due to unfortunate demise or illness. It can also

view as a comprehensive financial instrument, as a part of the financial planning

offering savings & investment facilities along with cover against financial loss. By

choosing the right policy as per the needs. i.e. customized solutions, you will be able

to plan for a secure future for yourself and your loved ones.

We all have different financial needs and objectives. But life insurance plays a

fundamental role in most of our plans for financial security. That's because of the

variety of life insurance plans available and the many ways they can be customized to

meet unique needs at different periods of your life.

Statement of the problem

Insurance sector is a booming sector and the penetration in India is quiet low.

So, all the private players are trying to increase the market share in the public. This

study also involves creating awareness among the urban and rural consumer about the

insurance sector and also the various policies involving various premium rates. Since

the penetration of private companies and policies is low among the consumer, it is

necessary to create awareness about life insurance policies and to know the

satisfaction level among consumer. Hence the present studies entitled awareness

about it among the consumer.

1.1 Objectives of the Study

To create an awareness about insurance company and policies.

To identify the potential policy holders among end users and to create a

relationship between the companies and potential customers.

1

To find out the customer satisfaction level among the go with their respecting

insurance companies in which they hold the polices.

To find out the awareness of people about insurance policies.

To offer suggestions based on findings.

Insurance Industry

The business of insurance started with marine business. Traders, who used to

gather in the Lloyd’s coffee house in London, agreed to share the losses to their goods

while being carried by ships. The losses used to occur because of pirates who robbed

on the high seas or because of bad weather spoiling the goods or sinking the ship.

The first insurance policy was issued in 1583 in England. In India, insurance began in

1870 with life insurance being transacted by an English company, the European and

the Albert. The first Indian insurance company was the Bombay Mutual Assurance

Society Ltd, formed in 1870. This was followed by the Oriental Life Assurance Co.

in 1874, the Bharat in 1896 and the Empire of India in 1897.

Later, the Hindustan Cooperative was formed in Calcutta, the United India in

Madras, the Bombay life in Bombay, the National in Calcutta, the New India in

Bombay, the Jupiter in Bombay and the Lakshmi in New Delhi. These were all

Indian companies, started as a result of the swadeshi movement in the early 1900s.

By the year 1956, when the life insurance was nationalized and the Life Insurance

Corporation of India (LIC) was formed on 1st September 1956, there were 170

companies and 75 provident fund societies transacting life insurance business in India.

After the amendments to the relevant laws in 1999, the L.I.C. did not have the

exclusive privilege of doing life insurance business in India. By 31.3.2002, eleven

new insurers had been registered and has begun to transact life insurance business in

India.

Need of Insurance

Assets are insured, because they are likely to be destroyed, through accidental

occurrences. Such possible occurrences are called perils. Fire, floods, breakdowns,

2

lightning, earthquakes, etc, are perils. If such perils can cause damage to the asset, we

say that the asset is exposed to that risk. Perils are the events. Risks are the

consequential losses or damages. The risk to an owner of a building, because of the

peril of an earthquake, may be a few lakhs or a few crores of rupees, depending on the

cost of the building and the contents in it.

The risk only means that there is a possibility of loss or damage. The damage

may or may not happen. Insurance is done against the contingency that it may

happen. There has to be an uncertainty about the risk. Insurance is relevant only if

there are uncertainties. If there is no uncertainty about the occurrence of an event, it

cannot be insured against. In the case of a human being, death is certain, but the time

of death is uncertain. In the case of a person who is terminally ill, the time of death is

not certain, though not exactly known. He cannot be insured.

Insurance does not protect the asset. It does not prevent its loss due to the

peril. The peril cannot be avoided through insurance. The peril can sometimes be

avoided, through better safety and damage control management. Insurance only tries

to reduce the impact of the risk on the owner of the asset and those who depend on

that asset. It only compensates the losses – and that too, not fully.

Only economic consequences can be insured. If the loss is not financial,

insurance may not be possible. Examples of non-economic losses are love and

affection of parents, leadership of managers, sentimental attachments to family

heirlooms, innovate and creative abilities, etc.

Types of insurance

Automobile insurance Aviation insurance

Boiler insurance

Builder’s risk insurance

Casualty insurance

3

Disability insurance

Liability insurance

Marine cargo insurance

Purchase insurance

Credit insurance

Crime insurance

Crop insurance

Directors and officers liability insurance

Property insurance

Terrorism insurance

Title insurance Travel insurance

Workers’ compensation

Life insurance

Total permanent disability insurance

Locked funds insurance

Marine insurance

Financial loss insurance

Health insurance

Professional indemnity insurance

Environmental liability insurance

Pet insurance

Political risk insurance

4

Profile of HDFC STANDARD LIFE INSURANCE Co.Ltd

HDFC Standard Life Insurance Company Ltd. is one of India's leading private

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 a Group

Company of the Standard Life, UK.

HDFC Standard Life is one of the leading life insurance companies having a track

record of declaring bonuses every year since inception. HDFC as on March 31, 2007

holds 81.9 per cent of equity in the joint venture.

STRENGTHS OF HDFC STANDARD LIFE INSURANCE

FINANCIAL EXPERTISE

HDFC Standard Life Insurance has the financial expertise required to

manage long-term investments safely and efficiently.

RANGE OF SOLUTIONS

HDFC Standard Life Insurance has a range of individual and group

solutions, which can be easily customized to specific needs. HDFC Standard

Life Insurance’s group solutions have been designed to offer a complete

flexibility combined with a low charging structure to people.

TRACK RECORD

HDFC Standard Life Insurance’s cumulative premium income,

including the first year premiums and renewal premiums is Rs. 1532.21 Crores

Apr-Mar 2005 - 06.

5

It has covered over 1.6 million individuals out of which over 5, 00,000

lives have been covered through our group business tie-ups.

VISION

The most successful and admired life insurance company, which mean

that we are the most trusted company, the easiest to deal with, offer the best

value for money, and set the standards in the industry.

'The most obvious choice for all'

VALUES:

Values that HDFC Standard Life Insurance observes are

Integrity

Innovation

Customer centric

People Care “One for all and all for one”

Team work

Joy and Simplicity

Major competitors of HDFC STANDARD LIFE

Life Insurance Corporation of India

ICICI Prudential Life Insurance

Bajaj Allianz Life

SBI Life Insurance

PRODUCT PROFILE OF HDFC STANDARD LIFE

6

HDFC Standard Life Insurance offers various insurance solutions to meet

every ones need. HDFC Standard Life Insurance offers various insurance solutions to

individuals as well as to companies looking to provide benefits to their employees.

The products that are offered by are mainly classified as follows,

Individual Products.

Group Products.

INDIVIDUAL PRODUCTS

1. Production plan

(a)Term assurance plan

A pure risk cover plan, which gives you protection against the uncertainties of

life. The Term Assurance Plan is an insurance policy that is designed to help secure

your family's financial needs.

(b) Loan cover term assurance plan

An ideal way to cover your home loan or other loan liabilities. This Plan

provides a lump sum on the unfortunate death of the life assured within the policy

term.

2. Investment plan

(a)Single premium whole of life plan

Our Single Premium Whole of Life plan is well suited to meet your long term

investment needs. We provide you with attractive long term returns through regular

bonuses.

3. Pension plans

(a)Personal pension plan

7

http://www.hdfcinsurance.com/products/indi_spwlp.asp

It provides a post retirement income in your golden years and gives you the

flexibility to plan your retirement date and Gives you tax benefits on your premiums.

The plan receives simple Reversionary Bonuses, which are usually added annually. At

the end of the term an additional Terminal Bonus may be paid depending on the

performance of the underlying investment.

(b) Unit linked pension

It's an outstanding investment opportunity by providing a choice of thoroughly

researched and selected investments and post retirement income for life and also

Flexibility to plan your retirement date.

(c)Unit linked pension plus


researched and selected investments. Regular Loyalty Units to boost your fund value

every year and post retirement income for life and also Flexibility to plan your

retirement date.

4. Savings plan

(a)Endowment assurance plan

It's an ideal way to secure your long-term financial goals. Valuable protection

to your family by way of lump sum payment in case of your unfortunate demise

within policy term and Lump sum payment on survival up to maturity date

(b) Unit linked Endowment


researched and selected investments. Valuable protection to your family in case you

8

are not around and Flexible benefit combinations and payment options and also

flexible additional benefit options such as critical illness cover.

(c) Unit linked Endowment plus



every year. Valuable protection to your family in case you are not around and Flexible

benefit combinations and payment options and also flexible additional benefit options

such as critical illness cover.

(d) Money back plan

A proportion of the basic sum Assured as Cash lump sums at regular 5-year

intervals within the policy term an ideal way to secure your long- term as well as

short-term financial goals and a lump sum payment on survival up to maturity date.

Valuable protection to your family by way of lump sum payment in case of your

unfortunate death within the policy term.

(e) Children's plan

The Children's Plan is designed to secure your child's future by giving your

child a guaranteed lump sum, on maturity or in case of your unfortunate demise, early

in the policy term. The premiums, paid by you, are invested by the company to give

you good long-term returns.

(f) Unit linked young star


researched and selected investments. Valuable protection to your child in case you are

9

not around. Flexible benefit combinations and payment options and also flexible

additional benefit options such as critical illness.

(g)Unit linked young star plus



every year and Valuable protection to your child in case you are not around and

Flexible benefit combinations and payment options and also flexible additional

benefit options such as critical illness cover.

GROUP PRODUCTS

(1)GROUP TERM INSURANCE PLAN

The Group Term Insurance (GTI) plan meets this need and serves as an ideal

way for companies to reinforce their bond with their employees. The sort of needs,

you, as an employer need to cater to could be in form of:

Employee benefits

Cover for housing or vehicle loans given by you to your employees

10

A GTI cover for future service gratuity liability to be taken along with the

Group Unit Linked Plan

One year renewable term insurance plan.

One master policy issued covering all members of the group.

(2) GROUP VARIABLE TERM INSURANCE

The Group Variable Term Insurance is a tailor made insurance policy for third

party institutions. HDFC Standard Life Insurance Company will offer life insurance to

customer’s of one or more of the third party’s specific products in order that in the

event of their death, there will be a lump sum available.

The Group Variable Term Insurance:

On death, will pay a lump sum known as a sum assured. The sum assured

varies over time in order that the customer receives the cover that they need.

Is a group policy.

Has no lengthy underwriting procedure.

Is simple to administer.

INSURANCE IN INDIA

About 154 Indian insurance companies, 16 non-Indian companies and 75

provident were operating in India at the time of nationalization. Nationalization was

accomplished in two stages; initially the management of the companies was taken

over by means of an Ordinance, and later, the ownership too by means of a

comprehensive bill. The Parliament of India passed the Life Insurance Corporation

11

Act on the 19th of June 1956, and the Life Insurance Corporation of India was created

on 1st September, 1956, with the objective of spreading life insurance much more

widely and in particular to the rural areas with a view to reach all insurable persons in

the country, providing them adequate financial cover at a reasonable cost.

LIC had 5 zonal offices, 33 divisional offices and 212 branch offices, apart

from its corporate office in the year 1956. Since life insurance contracts are long term

contracts and during the currency of the policy it requires a variety of services need

was felt in the later years to expand the operations and place a branch office at each

district headquarter. re-organization of LIC took place and large numbers of new

branch offices were opened. As a result of re-organization servicing functions were

transferred to the branches, and branches were made accounting units. It worked

wonders with the performance of the corporation. It may be seen that from about

200.00 crores of New Business in 1957 the corporation crossed 1000.00 crores only in

the year 1969-70, and it took another 10 years for LIC to cross 2000.00 crore mark of

new business. But with re-organization happening in the early eighties, by 1985-86

LIC had already crossed 7000.00 crore Sum Assured on new policies

Today LIC functions with 2048 fully computerized branch offices, 100

divisional offices, 7 zonal offices and the Corporate office. LIC’s Wide Area Network

covers 100 divisional offices and connects all the branches through a Metro Area

Network. LIC has tied up with some Banks and Service providers to offer on-line

premium collection facility in selected cities. LIC’s ECS and ATM premium payment

facility is an addition to customer convenience. Apart from on-line Kiosks and IVRS,

Info Centres have been commissioned at Mumbai, Ahmedabad, Bangalore, Chennai,

Hyderabad, Kolkata, New Delhi, Pune and many other cities.

With a vision of providing easy access to its policyholders, LIC has launched

its SATELLITE SAMPARK offices. The satellite offices are smaller, leaner and

closer to the customer. The digitalized records of the satellite offices will facilitate

anywhere servicing and many other conveniences in the future.

LIC continues to be the dominant life insurer even in the liberalized scenario

of Indian insurance and is moving fast on a new growth trajectory surpassing its own

past records. LIC has issued over one crore policies during the current year. It has

12

crossed the milestone of issuing 1,01,32,955 new policies by 15th Oct, 2005, posting

a healthy growth rate of 16.67% over the corresponding period of the previous year.

Insurance business in India are

1818: Oriental Life Insurance Company, the first life insurance company on Indian

soil started functioning.

1870: Bombay Mutual Life Assurance Society, the first Indian life insurance

company started its business.

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 are 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.

How Insurance Works

The mechanism of insurance is very simple. People who are exposed to the

same risks come together and agree that, if any one of them suffers loss, the others

will share the loss and make good to the person who lost. All people who send goods

by ship are exposed to same risks, which are related to water damage, ship sinking,

piracy, etc. Those owning factories are not exposed to these risks, but they are

exposed to different kinds of risks like, firer, hailstorms, earthquakes, lightning,

burglary, etc. Like this, different kinds of risks can be identified and separate groups

13

made, including those exposed to such risks. By this method, the heavy loss that any

one of them may suffer is divided into bearable small losses by all. In other words,

the risk is spread among the community and the likely big impact on one is reduced

smaller manageable impacts on all.

Insurance as a Security Tool

The United Nations Declaration of Human Rights 1948 provides that

“Everyone has a right to standard of living adequate for the health and well being of

himself and his family, including food, clothing, and housing and medical care and

necessary social service and the right to security in the event of unemployment,

sickness, disability. Life insurance provides such an alternate arrangement. If this did

not happen, another family will be pushed into the lower strata of society. The lower

strata create a cost on society. Life insurance tends to reduce such a cost. In this

sense, the life insurance business is complimentary to the states efforts in the social

management.

In a capitalist society provision of security is largely left to the individual.

Insurance is one of them to provide social security by state under some schemes.

Role of Insurance in Economic Development

For economic development investments are necessary. Investments are made

out of savings. A life insurance is a major instrument for the mobilization of savings,

particularly from the middle and lower income groups. This savings are channeled

into investments for economic growth.

Major Market Players in India

14

Presently there are 15 Life insurance companies in the country. There is only

one public sector company LIC and the rest 14 are private sector. Although LIC has

been dominating the Life Insurance business since past few years the private players

have now started to build up momentum.

HDFC – Standard Life

HDFC Standard is a 74:26 joint venture between HDFC and Standard Life. It

is a private sector company. The market share for FY 2005-06 was 2.87%.

Birla Sun Life Insurance Company

Birla Sun Life Insurance Company is a 74:26 joint venture between Birla

group and Sun Life Financial. It is a private sector company. The market share for FY

2005-06 was 1.89%.

ICICI Prudential Life Insurance

ICICI Prudential Life is a 74:26 joint venture between ICICI and Prudential. It

is a private sector company. The market share for FY 2005-06 was 7.35%.

Life Insurance Corporation of India (LIC)

Life Insurance Corporation of India is a 100% government held Public Sector

Company. Being the first to be established LIC is the forerunner in the Life Insurance

sector. The market share for FY 2005-06 was 71.44%.

Kotak Mahindra OLD Mutual

15

Kotak Mahindra OLD Mutual is a 74:26 joint venture between Kotak

Mahindra bank and Old Mutual. It is a private sector company. The market share for

FY 2005-06 was 1.11%.

Max New York Life

Max New York Life is a 74:26 joint venture between J & Bank, Pallonji & Co

and MetLife. It is a private sector company. The market share for FY 2005-06 was

1.23%.

Aviva Life Insurance India

Aviva Life insurance is a 74:26 joint venture between Aviva and Dabur. It is a

private sector company. The market share for FY 2005-06 was 1.14%.

ING Vysya Life insurance

ING Vysya Life Insurance is joint venture between Exide (50%), Gujarat

Cements (14.87%), Enam (9.13%) and ING (26 %). It is a private sector company.

The market share for FY 2005-06 is 0.79%.

MetLife India

MetLife India is a 74:26 joint venture between J & K Bank, Pallonji & Co and

MetLife. It is a private sector company. The market share for FY 2005-06 was 0.40%.

Bajaj Allianz Life Insurance Co

Bajaj Allianz Life Insurance Company is a 74:26 joint venture between Bajaj

Auto limited and Allianz AIG. The market share for FY 2005-06 was 7.56%.

SBI Life Insurance Company Ltd

16

SBI Life Insurance Company is a 74:26 joint venture between SBI and Cardiff

S.A. It is a private sector company. The market share for FY 2005-06 was 2.31%.

TATA AIG Group

TATA AIG group is a 74:26 joint venture between Tata Group and AIG. It

belongs to the private sector. The market share for FY 2005-06 was 1.29%.

Sahara India Life Insurance Company Ltd

First Wholly Indian Owned Private Life Insurance Company. The market

share for FY 2005-06 was 0.06 %.

Shriram Life Insurance Company Ltd

Shriram Life is a recent entrant into the life insurance sector It is a 74:26 joint

venture between the Shriram group through its Shriram Financial Holdings and

Sanlam Life Insurance Limited, South Africa.

MARKET SHARE OF PUBLIC AND PRIVATE SECTOR

COMPANIES

17

MARKET SHARE OF PRIVATE SECTOR INSURANCE COMPANIES

(IRDA)INSURANCE REGULATORY DEVELOPMENT

AUTHORITY

18

On the recommendation of Malhotra Committee, an Insurance Regulatory

Development Act (IRDA) passed by Indian Parliament in 1993. Its main aim was to

activate an insurance regulatory apparatus essential for proper monitoring and control

of the Insurance industry. Due to this Act several Indian private companies have

entered into the insurance market, and some companies have joined with foreign

partners. In economic reform process, the Insurance Companies has given boost to the

socio-economic development process. The huge amount of funds that are at the

disposal of Insurance Companies are directed as desired avenues like housing, safe

drinking water, electricity, primary education and infrastructure. Above all the

policyholders gets better pricing of products from competitive insurance companies.

Liberalization

The opening up of Insurance sector was a part of the ongoing liberalization in the

financial sector of India. The domain of State-run insurance companies was thrown

open to private enterprise on December 7, 1999, with the introduction of the

Insurance Regulatory and Development Authority (IRDA) Bill. The opening up of the

sector gave way to the world known names in the industry to enter the Indian market

through tie-ups with the eminent business houses. What was once a quiet business is

becoming one of the hottest businesses today.

Post liberalization

19

The changing face of financial sector and the entry of several companies in the field

of Life Insurance segment are one of the key results of these liberalization efforts.

Insurance business by way of generating premium income adds significantly to the

GDP. Despite the fact that the market is vast in India for the Insurance business, the

coverage is far less compared with the international standards. Estimates show that a

meager 35-40 million, out of a population of 950 million, have come so far under the

umbrella of the insurance industry. The potential market is so huge that it can grow by

15 to 17 per cent per annum. With the entry of private players, the Indian Insurance

Market may finally be able to make deeper penetration in to newer segments and

expand the market size manifold. The quality of service will also improve and there

will be wide The Life insurance market in India is likely to be risky in the initial

stages, but this will improve in the next three to five years Therefore, it may be

advantageous to be a second-round entrant. In the Life insurance market the need risk

assessment systems and data that are the key to success in the Life insurance market

are significantly underdeveloped in India even today.

CHAPTER-IV

ANALYSIS AND INTERPRETATION

20

The primary data collected through the questionnaire from government

officials were complied using spss package and the analysis are presented below.

TABLE 4.1

RESPONDENTS PROFILE OF AGE

Age(In Years) Frequency/ Percentage

25-35

35-45

45-55

>55

4

25

66

5

Total 100

(Source: Primary Data)

Table 4.1 shows, among the 100 sample respondents, the majority of 66% of

the respondents fall in the age group of 45-55 years. Another 25% fall in the category

of 35-45 years. There are 5% of the respondents who fall in the age group of above 55

years, while the remaining 4% are in the age group of 25-35 years. Thus, from the

analysis it can be concluded that the majority (66%) of respondents fall in the age

group of 45-55.

TABLE 4.2

21

GENDER PROFILE OF RESPONDENT

Gender Frequency/Percentage

Male

Female

73

27

Total 100


Table 4.2 shows, the 100 sample respondents, the majority of 73% of the

respondents are Male, while the remaining 27% are female. Thus, from the analysis it

can be concluded that the male respondents constituted the major position (73%)

TABLE 4.3

MARITAL STATUS OF RESPONDENTS

Marital Status Frequency/ Percentage

Married

Unmarried

99

1

Total 100


Table 4.5 shows, among the 100 sample respondents, the majority (99%) of

the respondents are married while the remaining 1% is unmarried among the

respondents. Thus, from the analysis it can be concluded that the majority (99%) of

respondents who are married.

TABLE 4.4

EXPERIENCE PROFILE OF RESPONDENTS

22

Experience of respondent

Frequency/ percentage

Less Than 10

10-20

20-30

>30

11

27

57

5

Total 100


As it could be seen in Table 4.4, among the 100 sample respondents, the

highest of 57% of the respondents fall in the experience group of 20-30 years.

Another 27% fall in the category of 10-20 years. There are 11% of the respondents

who fall in the experience group of less then 10 years, while the remaining 5% are in

the experience group of above 30 years. Thus, majority (57%) of respondents are in

the experience group of 20-30.

TABLE 4.5

ANNUAL INCOME LEVEL OF RESPONDENTS

23

Annual income

Frequency/

percentage

Less Than 180000

180000-300000

300000-420000

>420000

27

50

14

9

Total 100


Table 4.5 shows, out of 100 sample respondents, the majority 50% of the

respondents earn annual income between 180000-300000.Another 27% of

respondents are less than 180000. There are 14% of the respondents who earn

between 300000-420000, the remaining 9% among the respondents earn above

420000. Thus, from the analysis it can be concluded that the respondents who earn

between 180000-300000 constituted the major position (50%).

TABLE 4.6

24

AWARENESS ABOUT LIFE INSURANCE POLICIES

Awareness Frequency/ percentage

Yes

No

100

0

Total 100


As it could be seen in table 4.6 among the 100 sample respondent all of them

were aware of the life insurance policies, (i.e.) 100%. Thus from the analysis it can be

concluded that 100% of respondents are aware of the life insurance policies.

TABLE 4.7

25

SOURCE OF INFORMATION

SOURCE YES NO

Agent

Employer

Press

Relatives

T.v

Internet

Bankers

Brokers

Friends

Mobile

85

15

24

10

37

10

21

4

23

3

15

85

76

90

63

90

79

96

77

97


As it could be seen in table 4.7, among the 100 sample respondent, it is clear

that most of the respondents came to know about the insurance through agents (85%)

and the second highest source are the T.V (37%). None of the respondents have come to

know about the insurance through mobile. Thus, from the analysis it can be concluded

that 85% of the respondents came to know about insurance polices through agents.

26

FIGURE 4.1

CHART SHOWING SOURCE OF INFORMATION

YES

NO

Rows

AGENT CountEMPLOYER Count

PRESS Count

RELATIVES CountT V Count

INT ERNET Count

BANKERS CountBROKERS Count

FRIENDS Count

M OBILE Count

source

0

25

50

75

100

res

po

nd

en

t

27

TABLE 4.8

AWARENESS ABOUT THE INSURANCE COMPANY

Company name Yes No

LIC

Birla

HDFC

Bajaj

ICICI

SBI

Sriram

Kotak

Aviva

Reliance

Tata AIG

Metlife

Max Newyork

Sahara

Barathi

ING Vysya

100

26

75

27

55

55

18

6

3

12

19

0

5

3

0

16

0

74

25

73

45

45

82

94

97

88

81

100

95

97

100

84


As it could be seen in table 4.8 among the 100 sample respondent, it is clear

that 100% of the respondents are aware of LIC. And among the private players HDFC

has ranked first (75%) and followed by ICICI (55%), BAJAJ (27%), BIRLA (26%).

None of the respondent has come to know about Metlife and Max Barathi AXA life

insurance. Thus most of the respondents are aware of LIC and in the private sector

HDFC Standard Life insurance.

FIGURE 4.2

28

AWARENESS OF INSURANCE COMPANY

YES

NO

Rows

0 25 50 75 100

respondent

LIC

BIRLA SUNLIFE

HDFC ST ANDARD LIFE

BAJAJ ALLIANZ

ICICI PRUDENT IAL

SBI LIFE

SHRIRAM LIFE

OTHER

com

pan

ies

TABLE 4.9

PURPOSE OF TAKING POLICIES

Purpose Yes No

tax saving

investment

life risk

regular returns

health maintenance

retirement benefits

Others

57

38

46

22

19

6

1

43

62

54

78

81

94

99


29

As it could be seen in table 4.9 among the 100 sample respondents, 57% have

opted Tax saving as the major purpose of taking life insurance policies and Life risk

coverage, Investment are also the purpose of taking life insurance policies. Thus from

the analysis it can be concluded that most of the respondents are preferred to take

policies for the purpose of Tax Savings.

FIGURE 4.3

PURPOSE OF TAKING POLICIES

YES

NO

Rows

0 25 50 75 100

RESPONDENT

T AX SAVING Count

INVEST MENT Count

LIFE RISK COVERAGE Count

REGULAR RET URNS Count

HEALTH MAINT ANANCE Count

RET IREMENT BENEFIT S Count

OTHERS Count

PU

RP

OS

E

30

TABLE 4.10

AWARENESS OF THE POLICIES

Policies Name Yes No

Endowment

Whole life

Money back

With profit

Joint life

Children's

Convertible

Without profit

Variable Insurance

Annuity policy

Handicapped policy

Retirement policy

Salary saving scheme

ULIP

83

41

84

24

30

41

2

2

0

7

2

24

36

18

17

59

16

76

70

59

98

98

100

93

98

76

66

82


Table 4.10, shows among the 100 sample respondents, 84% of the respondent

are preferred money back policy and 83% of respondent are preferred endowment

policies. None of the respondents are preferred to Variable insurance, without profit

policy and handicapped policy. Thus from the analysis it can be concluded that most

of the respondents are preferred to take money back and endowment policies.

31

FIGURE 4.4

AWARENESS OF THE POLICIES

YES

NO

Rows

0 25 50 75

RESPONDENT

ENDOWMENT POLICY Count

WHOLE LIFE POLICY Count

M ONEY BACK POLICY Count

WIT H PROFIT POLICY Count

JOINT LIFE POLICY Count

CHILDREN'S POLICY Count

OTHERS Count

PO

LIC

IES

TABLE 4.11

RANKING FOR POLICIES

POLICIES RANK

1

RANK

2

RANK

3

RANK

4

RANK

5

RANK

6

RANK

7

Endowment

Whole life

Money back

With profit

Joint life

Children's

Others

21

8

46

5

4

5

12

27

15

15

8

9

13

13

20

8

10

1

12

27

21

11

8

12

16

18

17

21

15

34

7

13

21

7

3

3

22

9

36

17

11

1

3

5

1

21

19

20

29


32

As it could be seen in table 4.11 among the 100 sample respondents, the

respondents preferred Money Back policy as rank 1 (46%) and Endowment policy has

been ranked as 2 (27%) and Children's policy has ranked as 3 (27%). Thus from the

analysis it can be concluded that most of the respondents are ranked money back

policy as first.

FIGURE 4.5

RANKING FOR POLICIES

RANK1

RANK2

RANK3

RANK4

RANK5

RANK6

RANK7

Rows

10 20 30 40

RESPONDENT

ENDOWMENT POLICY Count


M ONEY BACK POLICY Count

WIT H PROFIT POLICY Count

JOINT LIFE POLICY Count

CHILDREN'S POLICY Count

OTHERS Count

PO

LIC

IES

33

TABLE 4.12

PREFERRED PREMIUM PERIOD

Period Frequency/Percentage

Annual

Half yearly

Quarterly

Monthly

21

16

15

48

Total 100


Table 4.12 shows, among the 100 sample respondents, 48% of the respondents

preferred monthly premium payment period and 21% of the respondents preferred

annual premium payment period. Thus from the analysis it can be concluded that 48%

of the respondents preferred monthly premium payment period.

34

FIGURE 4.6

PREFERRED PREMIUM PERIOD

ANNUAL HALFYEARLY QUARTERLY MONTHLY

PREMIUM PAYMENT PERIOD

0

10

20

30

40

50

RE

SP

ON

DA

NT

21

16 15

48

TABLE 4.13

35

PREFERRED PREMIUM PAYMENT

Mode Frequency/Percentage

Salary deduction

Through agent

By cash

By cheque

Online payment

58

11

7

18

6

Total 100


Table 4.13 shows, 4.7 among the 100 sample respondents, 58% of the

respondents preferred Salary Deduction as mode of payment and 18% of the

respondents preferred cheque as the mode payment. Thus from the analysis it can be

concluded that 58% of the respondents preferred Salary Deduction as mode of

payment.

36

FIGURE 4.7

PREFERRED PREMIUM PAYMENT

SALARY DEDUCTION

THROUGH AGENT

BY CASH BY CHEQUE ONLINE PAYMENT

MODE OF PAYMENT

0

10

20

30

40

50

60R

ES

PO

ND

AN

T

58

11

7

18

6

TABLE 4.14

37

PREFERRED DELIVERY OF POLICY DOCUMENTS

Policy Documents Frequency/Percentage

Online

By post

Through agent

Personally at insurance company's

3

22

43

32

Total 100



preferred to get the documents through agent and 32% of the respondents preferred to

get the documents from the insurance office itself. Thus, from the analysis it can be

concluded that 43% of the respondents preferred to get the documents through agent.

38

FIGURE 4.8

PREFERRED DELIVERY OF POLICY DOCUMENTS

ONLINE BY POST THROUGH AGENT PERSONALLY AT INSURANCE COMAPNY'S

OFFICE

MODE OF DELIVERY

0

10

20

30

40

50

RE

SP

ON

DA

NT

3

22

43

32

39

TABLE 4.15

PREFERRED MODE OF SETTELEMENT

Mode Frequency/Percentage

By cash

By cheque

On account transfer

19

75

6

Total 100



preferred to get the claims settlement through by cheque and 19% of the respondents

preferred to get the claims settlement through cash. Thus from the analysis it can be

concluded that 75% of the respondents preferred to get the claim settlement through

cheque.

FIGURE 4.9

40

THE PREFERRED MODE OF SETTELEMENT

HSAC YB EUQEHC YBREFSNART TNUOCCA NO

TNEMELTTES FO EDOM

0

02

04

06

08

TN

AD

NO

PS

ER

91

57

6

TABLE 4.16

41

RANKING THE DETAILS EXPECTED FROM AGENT

DETAILS R1 R2 R3 R4 R5 R6 R7 R8Features of policy

Premium amount

Period of premium

Mode of payment

Terms & condition

Other benefits

Other services

Settlements

21

24

21

9

21

1

1

3

13

30

27

7

20

0

0

4

24

14

18

18

17

2

0

7

17

16

12

17

13

11

0

15

16

8

11

23

13

15

9

6

5

2

3

17

9

28

23

12

3

2

6

5

4

32

40

6

1

4

2

4

3

11

27

47


Table 4.16 shows, among the 100 sample respondents, the respondents are

expecting the details about premium amount because it has been ranked as 1 (24%)

and period of premium has been ranked as 2 (27%) and features of policy has ranked

as 3 (24%). Thus from the analysis it can be concluded that most of the respondents

ranked premium amount as first detail followed by period of premium and feature of

policy.

42

FIGURE 4.10

RANKING FOR EXPECTING DETAILS FROM AGENT

RANK1

RANK2

RANK3

RANK4

RANK5

RANK6

RANK7

RANK8

Rows

10.00 20.00 30.00 40.00

RESPONDENT

FEAT URES OF T HE POLICY Count

PREMIUM AMOUNT Count

PEROID OF PAYMENT Count

M ODE OF PAYM ENT OF PREM IUM Count

T ERMS AND CONDITIONS Count

OTHER BENEFIT S Count

OTHER SERVICES Count

SET TLEMENT OF CLAIMS AND IT S CONDITIONS Count

DE

TA

ILS

TABLE 4.17

PREFERRED INSURANCE COMPANY

Sector Frequency

Public sector

Private sector

75

25

Total 100


Table 4.17 shows, among the 100 sample respondent 75% of respondents are

preferred public sector and 25% of the respondents are preferred private sector. Thus

from the analysis it can be concluded that 75% of respondents are preferred public

sector.

FIGURE 4.11

43

PREFERRED INSURANCE COMPANY

75

25

PREFERRED

SECTOR IN

INSURANCE

COMPANY

PUBLIC SECTOR

PRIVATE SECTOR

44

TABLE 4.18

RANKING FOR SELECTING AN AGENT

Details R1 R2 R3 R4 R5 R6 R7Knowledge of policy

Investment advice

Convincing approach

Premium details

Handling documents

Nominee details

Claim settlement

41

21

13

21

0

2

1

24

20

29

17

5

0

6

9

33

19

16

6

5

12

22

16

13

27

7

5

10

2

3

12

11

41

19

12

1

4

6

8

22

46

13

1

2

8

0

19

23

46



respondents are selecting the agent first to know about the knowledge of the policy

because it has been ranked as 1 (41%) and convincing has been ranked as 2 (29%) and

investment advice has ranked as 3 (33%). Thus from the analysis it can be concluded

that most of the respondents are selecting the agent's by knowledge of policy followed

by convincing approach and investment advice.

45

FIGURE 4.12

RANKING FOR SELECTING AN AGENT

RANK1

RANK2

RANK3

RANK4

RANK5

RANK6

RANK7

Rows

10.00 20.00 30.00 40.00

RESPONDANT

KNOWLEDGE ABOUT T HE POLICIES Count

INVEST MENT ADVICES FOR SELECT ING APPROPRIATE POLICIES Count

CONVINCING APPROACH Count

PAYMENT OF PREM IUM Count

HANDLING OVER OF POLICY DOCUMENT Count

CHANGE OF NOMINEE SERVICES Count

CLAIM SET T LEMENT SERVICES Count

DE

TA

ILS

46

TABLE 4.19RANKING THE PARAMETERS FOR SELECTING INSURANCE

COMPANY

DETAILS R1 R2 R3 R4 R5 R6 R7 R8 R9 R10 R11 R12Brand name

Availability of

product & services

Attractive

advertisement

Fulfillment of

customer needs

Fulfillment of

insurance

Terms & procedure

Sales promotion

Premium amount

Period of premium

Mode of premium

Rider clause

Online service

17

13

4

30

8

11

1

14

2

0

0

1

19

18

3

14

10

13

1

13

6

2

0

1

24

18

5

16

11

8

2

11

2

2

0

1

9

16

10

16

12

15

1

8

4

5

1

2

9

12

11

13

12

20

2

14

3

3

0

1

7

7

21

2

20

6

9

10

13

4

0

2

6

5

19

4

8

13

2

16

13

12

0

3

5

5

9

1

8

7

17

3

22

15

4

5

3

2

6

1

4

3

19

2

16

29

10

3

0

1

4

2

2

1

12

3

14

21

26

14

1

2

2

1

3

1

12

2

1

6

46

23

0

1

6

0

2

2

22

4

4

1

13

45



respondents are selecting the insurance company first to fulfillment of customer needs

because it has been ranked as 1 (30%) and availability of product and services has

been ranked as 2 (18%) and brand name has ranked as 3 (24%). Most of the

respondents are selecting the insurance company first to fulfillment of customer needs

followed by availability of product and services and brand name.

47

TABLE 4.20

PREFERENCE FOR FUTURE POLICY

Particulars No. of Respondents

Yes

No

34

66

Total 100


Table 4.20 shows, among the 100 sample respondent 66% of respondents are

preferred to take policy in future and 34% of the respondents are not preferred to take

policies in future. Thus from the analysis it can be concluded that 66% of respondents

are preferred to take policy in future.

FIGURE 4.13

PREFERENCE FOR FUTURE POLICY

66

34

PREFERENCE

FOR FUTURE

POLICY

YES

NO

48

TABLE 4.21

INTENDED TYPE OF POLICY IN FUTURE

Type of policy Respondent

Endowment policy

Joint life policy

Whole life policy

Children's policy

Money back policy

ULIP

11

8

4

28

13

2

Total 66


As it could be seen in chart 4.21 among the 66 sample respondents, 28

respondents are preferred to take Children's policy and 13 respondents are preferred

to take Money Back policy. Thus from the analysis it can be concluded that 28

respondents preferred to take Children's policy.

49

TABLE 4.22

PREFERRED INSURANCE COMPANY IN FUTURE

Company Respondent

LIC

HDFC

BAJAJ

ICICI

55

9

1

1

Total 66


Table 4.22 shows, among the 66 sample respondents, 55 respondents are

preferred to take LIC as there company and 9 respondents are preferred to take HDFC

as there company. Thus from the analysis it can be concluded that 55 of the

respondents preferred to take LIC as there company and among the private company

HDFC as their company.

50

TABLE 4.23

HOLDING OF INSURANCE POLICY

Particulars Holding Policies

Yes

No

98

2

Total 100


As it could be seen in Table 4.23 among the 100 sample respondent 98% of

respondents are currently having policies and 2% of the respondents are not having

policies. Thus from the analysis it can be concluded that 98% of respondents are

currently having policies.

FIGURE 4.14

HOLDING OF INSURANCE POLICY

98

2

CURRENT POLICY

YES

NO

51

TABLE 4.24

CURRENT INSURANCE COMPANY

Current company Respondent

LIC

LIC AND HDFC

LIC AND ICICI

HDFC

OTHERS

64

27

4

1

2

Total 98


Table 4.24 among the 98 sample respondents, 64 respondents is having

policies in LIC and 27 of respondents are having policies in both LIC and HDFC and

4 respondents are having in HDFC. Thus from the analysis it can be concluded that 64

of the respondents are having policies in LIC and HDFC is in the second place when

compared to others private players.

52

TABLE 4.25

NO. OF POLICIES

No. of Policies Respondent

1

2

3

4

6

45

36

11

Total 98



having two policies and 36 of respondents are having three policies. Thus from the

analysis it can be concluded that 45 of the respondents having two policies.

TABLE 4.26

53

CURRENT TYPE OF POLICY

Policies Yes NoEndowment

Joint Life

Whole Life

Children

Money Back

ULIP

57

28

14

50

54

24

41

70

84

48

44

74



having Endowment policies and 54 respondents are having Money Back policies and

50 respondents are having Children's policy. Thus from the analysis it can be

concluded that 57 respondents having Endowment policy.

FIGURE 4.15CURRENT TYPE OF POLICY

YES

NO

NIL

Rows

ENDOWMENT POLICY CountJOINT LIFE POLICY Count


CHILDREN'S POLICY CountM ONEY BACK POLICY Count

UNIT LINKED INSURANCE POLICY Count

POLICIES

0

25

50

75

RE

SP

ON

DA

NT

TABLE 4.27

PRESENT PURPOSE OF TAKING POLICIES

54

Purpose Yes NoTax saving

Investment

Life risk

Regular returns

Health maintain

Retirement benefits

55

39

36

30

18

8

42

59

62

68

80

89


Tables 4.27 among the 98 sample respondents, 59 respondents are having

policies for the purpose of tax savings and 39 respondents are having policies for the

purpose of Investment. Thus from the analysis it can be concluded that 59 respondents

are having policies for the purpose of tax savings.

FIGURE 4.16

PRESENT PURPOSE OF TAKING POLICIES

YES

NO

NIL

Rows

T AX SAVING CountINVEST MENT Count

LIFE RISK COVERAGE Count

REGULAR RET URNS CountHEALTH MAINT ANANCE Count

RET IREMENT BENEFIT S Count

PURPOSE

0

25

50

75

RE

SP

ON

DA

NT

TABLE 4.28

CURRENT PREMIUM PAYMENT PERIOD

55

Period Respondent

Annual

Half yearly

Quarterly

Monthly

One time

13

13

20

51

1

Total 98



paying monthly premium payment and 30 respondents are paying quarterly premium

payment. Thus from the analysis it can be concluded that 51 respondents are paying

monthly premium payment.

TABLE 4.29

CURRENT PREMIUM AMOUNT PAID ANNUALLY

56

Amount Respondent

< 3000

3000-5000

5000-7000

>9000

23

34

22

19

Total 98


Table 4.29 shows, among the 98 sample respondents, 34 respondent's annual

premium payment is in between Rs 3000-5000 and 23 respondent's annual premium

payment is below Rs 3000. Thus from the analysis it can be concluded that 34

respondent's annual premium payment is in between Rs 3000-5000.

TABLE 4.30

SATISFACTION LEVEL FOR PRESENT AGENT

57

Agent Service H.S S C.S D H.D TotalKnowledge about policies

Investment advices

Convincing approach

Payment of premium

Claim settlement

Change of nominee

Handling over the documents

42

8

4

9

6

6

4

50

83

82

83

37

68

34

4

5

10

5

55

21

60

1

1

2

1

0

2

0

1

1

0

0

0

1

0

98

98

98

98

98

98

98



satisfied with agent services like Knowledge about the policies, Investment Advices,

Convincing Approach, Payment of Premium and Change of Nominee but the

respondents are not aware of their own Claim settlement and Handling over the

Documents, so its comes under can't say category. Thus from the analysis it can be

concluded that the respondents are satisfied with the current agent services.

TABLE 4.31

SATISFACTION LEVEL SCORES FOR AGENT SERVICE

58

Satisfaction Level Scores No. of Respondents

Highly Dissatisfied

Dissatisfied

Can't Say

Satisfied

Highly Satisfied

Exactly 7

8 – 14

15 – 21

22 – 28

29 – 35

0

0

1

86

11


Table 4.31 clearly shows that 86 respondents are got scores in between 22 –

28, thus, the respondents are satisfied with the agent service.

TABLE 4.32

SATISFACTION LEVEL FOR INSURANCE COMPANY

59

Insurance company H.S S C.S D H.D TotalBrand name

Product & service

Customer needs

Attractive advertisement

Terms & procedures

Sales promotion

Premium amount

Period of premium payment

Mode of payment of premium

Availability of rider clause

Online service

Loans against policies

Settlement of claims

34

17

9

6

9

1

17

15

18

4

2

3

3

56

80

81

81

80

67

74

79

70

42

31

27

26

6

1

5

8

8

30

6

4

10

50

65

67

69

1

0

2

3

1

0

1

0

0

2

0

1

0

1

0

1

0

0

0

0

0

0

0

0

0

0

98

98

98

98

98

98

98

98

98

98

98

98

98



satisfied with the company services like Brand name, Availability of Product and

Services, Fulfillment of Customer needs, Attractive advertisement, Terms and

Procedures, Sales Promotion measures, Premium amount, Period of premium

payment, Mode of payment of premium but the respondents are not aware of Claim

settlement, Loans against policies, Online services and Availability of rider clause, so

its comes under can't say category. Thus from the analysis it can be concluded that the

respondents are satisfied with the current company services.

TABLE 4.33

SATISFACTION LEVEL SCORES FOR INSURANCE COMPANY

60

Satisfaction Level Scores No. of Respondents

Highly Dissatisfied

Dissatisfied

Can't Say

Satisfied

Highly Satisfied

Exactly 13

14 – 26

27 – 39

40 – 52

53 – 65

0

0

0

87

11


Table 4.33 clearly shows that 87 respondents are got scores in between 40 –

52, Thus, the respondents are satisfied with the insurance company.

CHAPTER –V

FINDINGS, SUGGESTION&CONCLUSION

61

5.1 GENERAL FINDINGS

HDFC Standard Life Insurance Co. Ltd. has increased its share capital by Rs

50 Crores.

The two partners in the joint venture, HDFC Ltd. and Standard Life Assurance

Company, U.K. have brought in the additional capital and the share capital of

the company now stands at Rs 218 Crores.

HDFC Standard Life Insurance’s cumulative premium income, including the

first year premiums and renewal premiums is Rs. 1532.21 Crores Apr-Mar

2005 - 06.

It has covered over 1.6 million individuals out of which over 5, 00,000

lives have been covered through our group business tie-ups.

It was necessitated on account of the strong growth shown by the company in

the current financial year in its life insurance and pension business.

5.2 SPECIFIC FINDINGS

Majority (66%) of respondents fall in the age group of 45-55.

The male respondents constituted the major position (73%).

Majority (99%) of respondents who are married.

Majority (57%) of respondents are in the experience group of 20-30.

The respondents who earn between 180000-300000 constituted the major

position (50%).

100% of respondents are aware of the life insurance policies.

85% of the respondents came to know about insurance polices through agents.

Most of the respondents are aware of LIC and in the private sector HDFC

Standard Life insurance.

Most of the respondents are preferred to take policies for the purpose of Tax

Savings.

62

Most of the respondents are preferred to take money back and endowment

policies.

Most of the respondents are ranked money back policy as first.

48% of the respondents preferred monthly premium payment period.

58% of the respondents preferred Salary Deduction as mode of payment.

43% of the respondents preferred to get the documents through agent.

75% of the respondents preferred to get the claim settlement through cheque.

Most of the respondents ranked premium amount as first detail followed by

period of premium and feature of policy.

75% of respondents are preferred public sector.

Most of the respondents are selecting the agent's by knowledge of policy

followed by convincing approach and investment advice.

Most of the respondents are selecting the insurance company first to

fulfillment of customer needs followed by availability of product and services

and brand name.

66% of respondents are preferred to take policy in future.

28 respondents preferred to take Children's policy.

55 of the respondents preferred to take LIC as there company and among the

private company HDFC as their company.

98% of respondents are currently having policies.

64 of the respondents are having policies in LIC and HDFC is in the second

place when compared to others private players.

45 of the respondents having two policies.

57 respondents having Endowment policy.

59 respondents are having policies for the purpose of tax savings.

51 respondents are paying monthly premium payment.

34 respondent's annual premium payment is in between Rs 3000-5000.

The respondents are satisfied with the current agent services.

63

86 respondents are got scores in between 22 – 28, so the respondents are

satisfied with the agent service.

The respondents are satisfied with the current company services.

87 respondents are got scores in between 40 – 52, so the respondents are

satisfied with the insurance company.

5.3 SUGGESTIONS

In view of the competition from LIC and other private players in the market,

HDFC Standard Life should organize more awareness campaigns to create

awareness and to promote their existing products.

More new products and services should be innovated through financial

engineering process to tap rural and social sectors.

To retain old customers and to attract new customer's products with adds-on

features should be introduced besides attractive advertisements.

To reach out more customers, tie-ups with companies, in various sectors can

be arranged to cover the insurance needs of their employees.

As the awareness level among the government officials for some insurance

policies like ULIP, Money back plan, Endowment plan, Children's plan,

Protection plan, etc. are very low, periodical awareness programs in the

respective government officials with concurrence of higher officials should be

conducted.

64

To enhance the satisfaction level of policyholders and to avoid losing the

existing customers periodical market surveys should be conducted.

To utilize one of the most important marketing channel (commercial banks)

very effectively for promoting the products, steps should be taken to make the

banks incorporate successful sales tactics used by them to sell other financial

services.

65

5.4 CONCLUSION

Insurance sector is one of the most booming sectors in India. The penetration

level of insurance in India is only 2.3% when compared to 9-15% in the developed

nations. There is a huge market for the Insurance products in the future in India.

The project was very useful to the researcher to understand the life insurance

business.

66

Bibliography

Books

Khan. M. Y, FINANCIAL SERVICES, Tata McgrawHill, New Delhi

Gordon and Natarajan, Financial Markets and Services, Himalaya Publishing

House, Mumbai

V.A Avadhani, Marketing of Financial Services, Himalaya Publishing House,

Mumbai

WEBSITES

www.hdfclifeinsurance.com

www.irda.com

REPORTS

IRDA Reports

67

http://www.irda.com/

http://www.hdfclifeinsurance.com/

promotional strategy in life insurance companies

Economy & Finance