Insurence Project r.p.1

Summer training Project Report
On
“Potential

of Life insurance Industry with reference to Bajaj Allianz”

For Submitted for Partial Fulfillment Of “Masters of Business Administration” (MBA -2009-2011)
Under The Guidance of:of:Under The Supervision

Mr.Uttkarsh Shukla Tiwari

Mr.Anuj Kumar

Submitted By:ANKIT KUMAR TRIPATHI Roll No. 0944070005

Naraina Vidya Peeth Management Institute
1

Panki, Kanpur-208020

Naraina Vidya Peeth Management Institute Gangaganj,Panki, Kanpur-208020
DATE. . . . . . .

To Whom It may Concern

This

is

to

certify

that

Mr./Ms.

ANKIT

KUMAR

TRIPATHI

student of M.B.A Course (2009-11) at Naraina Vidya Peeth Management Institute with dual Specialization in completed the summer research Marketing & HR project on has satisfactorily

Potential of Life

insurance Industry with Bajaj Allianz. study is done under the
guidance of the undersigned by partil fulfillment for the award of M.B.A .I wish him /her all the best for bright future ahead.

Suervisor

Head of Department

Director

2

Institute’s Certificate

3

COMPANY’S CERTIFICATE

4

STUDENT DECLARATION

I, Ankit kumar tripathi student of M.B.A at Naraina Vidya Peeth Management Institute, Kanpur of hereby declare that the Project work entitled “Potential of Life insurance Industry with Reference to Bajaj Allianz.” Is Compiled and submitted under the guidance of Mr. ANUJ KUMAR TIWARI This is my original work Whatever information furnished in this project report is true to the best of my knowledge.

ANKIT KUMAR TRIPATHI MBA Final Year Roll No: - 0944070005

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ACKNOWLEDGEMENT

I would like to express my Acknowledgement to those people, without whose contribution, Support and guidance this Report would not have seen the light of the day. Notable among them are Mr. ANUJ KUMAR TIWARI (SENIOR SALES Manager, BAJAJ ALLIANZ Life Insurance) who was my Project Guide and who helped me in a lot. I am also thankful to all other employees of BAJAJ ALLIANZ who guide me during my Project work. I am also thankful and would like to express my Gratitude to the Honorable Mr.Uttkarsh Shukla and the entire Institute for giving me a Platform to have this wonderful opportunity and being able to get a glimpse of the Corporate World.

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PREFACE
The importance of an academic course would gain advantage and acceptance of the true form only through practical experience. Hence, it is quite necessary to put the theories into talk. It is rigidly accepted that the theory widens one’s thinking horizons viz. Concepts of marketing philosophies, but practice indicates the modern marketing and used in variety of settings of products. The summer training programmers are designed to give the manager the future of the corporate happenings and work culture. These real life situations are entirely different from the stimulated exercise enacted in an artificial environment inside the summer training programmers and designed, so that the manager to tomorrow do not feel ill case when the time comes to shoulder responsibilities. Practical exposure for the MBA students is very necessary because what they study in the classroom is not the reality. Situation in the market is unknown and very much unpredictable. So the practical experience is very much necessary this is made possible with the summer training project in BAJAJ ALLIANZ Life Insurance Co. in marketing related to search for the Potential Insurance Consultants. All organizations involve into business with some objective and one of the objectives is to endorse product or service which they produce. In my marketing project I tried to fid out the potential Insurance Consultants through questionnaire for the BAJAJ ALLIANZ Life Insurance Co. The product for the insurance company is its policies which company sale through its Insurance Consultants. So it’s quite clear that there will be as many Insurance Consultants. There will be increased sales.

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INDEX
S.No Topics Institute’ Certificate Company Certificate Acknowledgement Preface 1. Introduction • • About the topic Objective of the study 14 44 52 75 88 92 43 51 87 89 91 93 Page No From To

2. Industry Profile 3. Company Profile 4. Marketing analysis of company 5. Data Analysis /method employed 6. Interpretation of Data 7. Findings 8. Conclusion 9. Suggestion

- 74

90 -

94 - 95

10. Limitation of the study 11. Appendices • • Questionnair Organizational Structure

96 - 97 98 99 - 101 102 - 103 104 105 - 107

12. Bibliography

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9

INTRODUCTION
“Insurance provides indemnification against loss or liability from specific events and circumstances that may occur or be discovered during a specific period.” -FASB Statement of financial accounting standards No. 113, “Accounting for reinsurance of Short-Duration and Long Duration contracts” December 1992. WHAT IS INSURANCE? In the ‘Dictionary of Business & Finance’ insurance is stated to mean “a form of contract or agreement under which one party agrees in return for a consideration to pay an agreed amount of money to another party to make good or loss, damage or injury to something of value to which the insured has a pecuniary interest as a result of some uncertain event. It is a device by which the loss likely to be caused by an uncertain event is spread over a number of persons who are exposed to it and who propose to insure themselves against such an event.” Thus, we may define insurance as the provision, which a prudent man makes against happenings by chance or, inevitable contingencies, loss or misfortune.

In financial term :
The term insurance may be defined as a social device providing financial compensation for the consequences of adversity, the payment being made from the accumulated contributions of all parties participating in the arrangement.

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In legal sense :
The term insurance may be defined as a contract under which the insurer (insurance company) in consideration of a sum of money paid (premium) by the insured (the person whose risk is insured) Insurance may be defined as a contract whereby one party agrees to pay another party a sum of money in exchange for some consideration on the happening of a certain event. It has been described by Chief Justice Tidal as a contract in which a sum of money is paid by the assured in consideration of the insurer’s incurring the risk of paying a larger sum upon a given contingency. The person or organization that protects another against risk is known as the ‘Insurer’ while the person who is protected against the risk is the ‘Insured’. The document containing the agreement is the ‘Insurance Policy’. The amount for which the insurance policy is taken is the ‘Insured Amount’. The consideration, which the insured has to pay to the insurer, is known as the ‘Premium’. Insurance has come to occupy an important place in the smooth running of business. It offers the following advantages to business:  Security,  Distribution of risk,  Competitiveness,  Specialization,  Optimum use of available capital,  Capital mobilization,  Promotion of foreign trade,  Loan facility  Social welfare.

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TYPES OF INSURANCE:
Re-Insurance :
Re-insurance is a sub-insurance, which the insurer may affect if he thinks that he has insured a big risk and wants his liability to be shared by other insurers. A contract of re-insurance is a contract of indemnity just as the original contract of insurance.

Life Insurance :
Life insurance is a contract under which one person, in consideration of a premium paid either in lump sum or by monthly, quarterly, half yearly or yearly payments, the insurer agrees to pay a specified sum of amount on the death of the assured or on the expiry of a certain fixed period, whichever is earlier. The rate of premium remains constant. The periodical payments made by the assured towards the total premium are known as installments. Usually, nonpayment of premium in any year brings the contract to an end.

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OBJECTIVE OF THE STUDY

The main of the present study of is accomplishing the following objective • • • • • • • • • • Proper understanding and analysis of life insurance industry. According the market survey come know about how much potential of insurance market in our city. And base on analysis of the result thus obtained make a report on that research. To explore the need & benefits of Life insurance. To explore the customer responses towards Bajaj Allianz products. To know the market share of Bajaj Allianz in the market. To discover answer to the question through the application of scientific procedures. To study awareness of the Bajaj Allianz life insurance. To understand the deciding criteria for people insurance sector To determine the need and purpose of brand loyalty in insurance sector

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INDUSTRY PROFILE

INDIAN INSURANCE INDUSTRY:
Insurers: Insurance industry, as on 1.4.2000, comprised mainly two players: the state insurers: Life Insurers:

•

Life Insurance Corporation of India (LIC)

General Insurers: • General Insurance Corporation of India (GIC) (with effect from Dec’2000, a National Reinsured) GIC had four subsidiary companies, namely (with effect from Dec’2000, these subsidiaries have been de-linked from the parent company and made as independent insurance companies. 1. The Oriental Insurance Company Limited. 2. The New India Assurance Company Limited. 3. National Insurance Company Limited. 15

4.

United India Insurance Company Limited.

INSURANCE BUSINESS:Insurance business is divided into four classes:

1. Life Insurance, 2. Fire Insurance, 3. Marine Insurance, 4. Miscellaneous Insurance.
Life Insurers transact life insurance business; General Insurers transact the rest no. composites are permitted as per Law. LEGISLATION: (as on 1.4.2000) Insurance is a federal subject in India. The primary legislation that deals with insurance business in India is: Insurance Act, 1938, and Insurance Regulatory & Development Authority Act, 1999. INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY: Composition of Authority under IRDA Act, 1999: As per the section 4 of IRDA Act' 1999, Insurance Regulatory and Development Authority (IRDA, which was constituted by an act of parliament) specify the composition of Authority. The Authority is a ten member team consisting of (a) A Chairman; 16

(b) five whole-time members; (c) four part-time members, (all appointed by the Government of India)

ENTRY OF PRIVATE PLAYERS IN LIFE INSURANCE MARKETS:
With the opening for private participation in the year 2000, the insurance landscape changed completely and till date 13 new entrants entered in the field of life insurance and the latest one being Sahara India Life Insurance Company Ltd. which commenced its operations from 31, October 2004. Life Insurer in Public Sector: Life Insurance Corporation of India (LIC) Life Insurers in Private Sector: 1. BAJAJ ALLIANZ Life Insurance Life 2. Tata AIG Life 3. ICICI Prudential Life Insurance 4. HDFC Standard Life 5. Birla Sunlife 6. SBI Life Insurance 7. Kotak Mahindra Old Mutual Life Insurance 8. Aviva Life Insurance

9.

Reliance Life Insurance Company Limited - Formerly known as AMP Sanmar LIC.

10. MetLife India Life Insurance 11. ING Vysya Life Insurance 12. Max NewYork Life Insurance 13. Sahara Life Insurance - Now they are not into business 14. Shriram Life Insurance 17

15. Bharti AXA Life Insurance Co Ltd

A BRIEF HISTORY
The origin of insurance is very old. The time when we were not even born; was has sought some sort of protection from the unpredictable calamities of the nature. The basic urge in man to secure himself against any form of risk and uncertainty led to the origin of insurance. The insurance came to India from UK; with the establishment of The Oriental Insurance Corporation in 1818. the Indian Life Insurance company act 1912 was the first statutory body that started to regulate the Life Insurance business in India. By 1956 about 154 Indian, 16 foreign and 75 provident firms were been established in India. Then the central government took over these companies and as a result the LIC was formed. Since then LIC has worked towards spreading Life Insurance and building a wide network across the length and the breath of the country. After the liberalization the entrance of foreign players has added to the competition in the market. 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. In 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. In 1972 the General Insurance Business in India with effect from 1 s t January 1973. it was after this that 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. GIC incorporated as a company. 18

INSURANCE SECTOR REFORMS
In 1993, Malhotra Committee headed by former Finance Secretary and RBI Governor was formed to evaluate the Indian industry and give its recommendations. provisions: Private Companies with a minimum paid up capital of Rs. 1 bn should be allowed to enter the industry.  Foreign companies may be allowed to enter the industry in collaboration with the domestic companies.  Only one state level Life Insurance Company should allow to operate in each state. The committee came up with the following major

Reforms were initiated with the passage of Insurance Regulatory and Development Authority (IRDA) Bill in 1999. IRDA was set up as an independent regulatory authority, which has put in place regulations in line with global norms.

IRDA : The IRDA since its incorporation as a statutory body has been
framing regulations and registering the private sector insurance companies. IRDA being an independent statutory body has put a framework of globally compatible regulations.

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INSURANCE MARKET IN INDIA
By any yardstick, with about 200 million middle class households, presents a huge untapped potential for players in the insurance industry. Saturation of markets in many developed economies has made the Indian market even more attractive for global insurance majors. With the per capital income in India expected to grow at over 6% for the next 10 years and with improvement in awareness levels, the demand for insurance is expected to grow at an attractive rate in India. An independent consulting company, the Monitor Group has estimated that the Life Insurance market will grow.

Winds of change:
Reforms have marked the entry of many of the global insurance majors into the Indian market in the form of joint ventures with Indian companies. Some of the keys names are AIG, New York Life, Allianz, Prudential, Standard Life, Sun Life Canada and Old Mutual. The entry of new players has rejuvenated the erstwhile monopoly player LIC. Which has responded to the competition in an admirable fashion by launching new products and improving service standards?

Market Expansion :
There has been an overall expansion in the market. This has been possible due to improved awareness levels thanks to the large number of advertising campaigns launched by all the players. The scope for expansion is still unlimited as virtually all the players are concentrating on large cities and towns – except by LIC to an extent there was no significant attempt to tap the rural markets.

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New Product Offering :
There has been a plethora of new players, mainly from the stable of their international partners. Customers have tremendous choice from a large variety of products from pure term insurance to unit-linked investment products. Customers are offered unbundled products with a variety of benefits as riders from which they can choose. More customers are buying products and services based on their true needs and not just traditional money-back policies, which is not considered very appropriate for long-term protection and savings. However, there are still some key new products yet to be introduced – e.g. health products.

Customer Service :
Not unexpectedly, this was one area that witnessed the most significant change with the entry of new players. There is an attempt to bring in international best practices in service and operational efficiency though use of latest technologies. Advice and need based selling is emerging through much better trained sales force and advisors. There is improvement in response and turnaround times in specific areas such as delivery of first policy receipt, policy document, premium notice, final maturity payment, settlement of claims etc. However, there is a long way to go and various customer surveys indicate that the standards are still below customer expectation levels.

Channels of Distribution :
Till two years back, the only mode of distribution of life insurance products was through Agents. While agents continue to be the predominant distribution channel, today a number of innovative alternative channels are being offered to customers. Some of them are banc assurance, brokers, the internet and direct marketing. Though it is too early to predict, the wide

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spread of bank branch network in India could lead to banc assurance emerging as a significant distribution mechanism. 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. LIC market share has decreased from 95% (2008-09) to 82% (2009-10). The following companies have the market share of the life insurance industry.

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CURRENT SCENARIO OF THEINSURANCE INDUSTRY IN INDIA

India with about 200 million middle class household shows a huge untapped potential for players in the insurance industry. Saturation of markets in many developed economies has made the Indian market even more attractive for global insurance majors. The insurance sector in India has come to a position of very high potential and competitiveness in the market. Innovative products and aggressive distribution have become the say of the day Indians, have always seen Life Insurance as a tax saving device, are now suddenly turning to the private sector that are providing them new products and variety for their choice. Life Insurance industry is waiting for a big growth as many Indian and Foreign companies are waiting in the line for the green signal to start their operations. The Indian Consumer should be ready now because the market is going to give them all array of products, different in price, features and benefits. How the customer is going to make his choice will determine the future of the industry.

CUSTOMER SERVICE:
Consumers remain the most important centre of the insurance sector. After the entry of the foreign players the industry is seeing a lot of competition and thus improvement of the customer service in the industry. Computerization of operations and updating of technology has become imperative in the current scenario. Foreign players an bringing in international best practices in service through use of latest technologies. The one time monopoly of the LIC and its agents are now going through a through revision and training programs to catch up with the other private players.

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DISTRIBUTION CHANNELS:
India but still the increasing use of other sources is imperative. It therefore makes sense to look at well – balanced, alternatives channels of distribution. LIC has already well established and have an extensive distribution channel and presence. New players may find it expensive and time consuming to bring up a distribution Till date insurance agents still remain the main source through which insurance products are sold. The concept is very well established in the country like channel to have an advantage. At present the distribution channels that are available in the market are:  Direct Selling  Corporate Agents  Group Selling  Brokers and Cooperative Societies To make all these channels a success the companies have to be very alert and skillful to know how to use these channels in a proper way. PRODUCT INNOVATION: Customers have tremendous choice from a large variety of products from pure term insurance to unit-linked investment products. Customers are offered unbundled products with a variety of benefits as riders from which they can choose. More customers are buying products and services based on their true needs and not just traditional money- back policies, which is not considered very appropriate for long-term protection and savings. RURAL MARKETING: 24

Rural India seems to have an appetite for mobile phones, computers, and cars and to add to it we have insurance. In India with the private players having entered into the insurance industry, the expected explosion in job opportunities may not actually happen but for them the catchments area is the Opportunities in the rural India. In India the insurance business can be said to be “a marathon, not a sprint”. This is because of the nature of the business being long term. However it seems that they if not anything, are only increasing their spending, though only out of the capital. As insurance companies go more and more rural in search of business, there will be opportunities in the rural sector. Already United India The Rural consumer is now exhibiting an increasing propensity for Insurance products. A research conducted exhibited that the rural consumers are willing to dole out anything between Rs. 3,500 and Rs. 2,900 as premium each year. In the Insurance the awareness level for Life Insurance is the highest in rural India, but the customers are also aware about motor, accidents and cattle insurance. According to a study nearly one third said that they had purchased some kind of insurance with the maximum penetration skewed in favor of life insurance. The study also pointed out the private companies have huge task to play in creating awareness and creditability among the rural populace. INFORMATION TECHNOLOGY AND INSURANCE: In the insurance industry today, there is a clear trend away from selling a broad range of products to a large volume of customers in a one- size-fitsall manner. Instead of focusing on their different products lines as silos (i.e., life, property and casualty etc) insurers are looking for ways to offer highly targeted insurance products that are tailored to the individuals customers with the highest propensity to buy them. Insurance industry is a data-rich industry, and thus, there is desire need to use the data for trend analysis and personalization. With increased competition among insurers, service has become a key issue. People today don’t want to accept the current value propositions, they want personalized interactions and they look for more and more features and 25

add ones and better service. Today managing the customer intelligently is very critical for the insurer especially in the very competitive environment. Companies need to apply different set of rules and treatment strategies to different customer segments.

MERGERS AND ACQUISTIONS : This is an era of mergers and acquisitions. Private companies including MNC’s are amalgamating the world over to get more competitive edge. Currently, the general insurance industry has been opened up. The insurers are doing enough to raise the level of risk awareness or are they merely content to compete in the markets organized and established. The private players in the future would have to turn their attention to working in the unorganized and under served markets. What is likely to happen is that the private players would continue to skim the profitable segments of the already organized business in the urban areas? The time has already come for the government of India to evaluate the performance of private companies. However it is high time for the government to realize that importance of merging the public sector general insurance companies into single entity. The recent scenario calls for a better performance from part of each of the public sector insurance companies against each other. The result what we see is the undercutting to retain or wrest business and quoting an uneconomical rate of premium. While this allows one of the Public Sectors Company to win a business form another in this manner. The others suffer a loss and the resultant effect is a cannibalization with a fall in the average premium of the public sector itself. The purpose of having four companies all subsidiaries of General Insurance Corporation of India (GIC) – National Insurance Company, New India Assurance Company, Oriental Insurance Company, and The 26

United India Insurance Company; at the time of nationalization was to have competition among themselves – in service and products at the same price. View of undeserved competition among the public sector companies is hampering the subsidization of social insurance including the motor third party liability (TPL). It is thus clear that it is good for the public sector companies to merge immediately when they are still strong, lest a merger becomes inevitable later after the independent public sector companies fail one after another. STRATEGIC ALTERNATIVES : If one analyses the history of growth of the insurance industry since reforms, it is marked by all- round growth of all players. More or less all players have aggressively recruited and trained advisors, appointed agents, launched new products, improved customer service standards and revamped/expanded their distribution networks. Every player would like the customers to believe that its service standards are the best or that its agents are the most informed and ethical. In other words, each company is trying to be ‘everything to everybody’. Some players justify the above strategy on the basis that the Indian market is huge and it can accommodate everybody. Still, in a market where it is difficult to distinguish oneself sufficiently on service or any other parameter to be able to charge a premium, it will lead to unmitigated price competition to the detriment of all players. In the insurance industry where large amounts of capital are required, this is risky. While there is room for a few scale players with a finger in every pie, it is profitable for the players to focus on different segments to survive.

Variety-based Positioning :

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This type of positioning is based on varieties in products and services rather than customer segments. It is a sensible strategy for those companies who have distinctive advantages or strengths in offering certain products and services. In the insurance industry too, it is possible to achieve a unique position by focusing on certain category of products. Through its superior fund management capabilities, the insurance company can deliver better returns on it investment-linked products and thereby for itself a leadership position in this segment. Then there is the entire category of pension products, which is widely touted to have immense growth potential in India due to imminent pension reforms. It is possible to achieve profitable positioning by focusing and excelling in only pension products.

Needs –based Positioning:
This is the most commonly understood positioning and is based on the different needs of different groups of consumers. This can be done successfully if a company has unique strengths to service a group of customer needs better than others. The insurance needs of young family with small children will be quite different from that of a family in which the income-earner is close to retirement. However, in India most of the Life Insurance companies have a wide variety of products of different customer needs and there is no company focusing only on a particular customer needs.

Access- based Positioning:
Positioning of customers can also be done by the way they are accessible that is different groups of customers may be accessible in different ways even though they may have similar needs. Access is typically a function of customer scale.

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There is excellent opportunity in the insurance industry to employ accessbased positioning by targeting the rural insurance sector. The rural market for Life Insurance is very different from the urban market in terms of needs, income levels, distribution, penetration of media and so on. Except for LIC, no other player has paid any attention or focus on the rural sector. Contrary to common perception it is a big opportunity as emphasized repeatedly by such eminent strategies like C.K.Prahlad. Rural market can be a highly profitable position if one is able to carefully plan. CHOOSING THE RIGHT STRATEGY: The right strategic choice is not a matter of positioning choice alone. It is the configuration of the entire value chain of the company through a different set of activities to deliver unique value to consumers. The set of activities cover all upstream and downstream activities, from the selection of the product mix. Some Life Insurance companies focusing on rural markets have adopted innovative means of distribution. Instead of appointing agents as is done typically, they have used Gramsevaks in different villages across the country to promote Life Insurance and act as their sales arm. So we can conclude that, the size of the market has grown and the size of the insurable population in India is indeed vast and the existing players have managed to cover about one-fourth of it. The falling interest rates, the collapse of many small –time financial institutions, the scope for entering related areas like banking and pensions in a bid for synergy and the promise of the e-commerce are some of the other opportunities knocking at the doors of the insurance majors. A number of web sites are coming up on insurance, a few financial magazines exclusively devoted to insurance and also a few training institutes being set up hurriedly. Life insurance has today become a mainstay of any market economy since it offers plenty of scope for garnering large sums of money for long periods 29

of time. A well regulated Life Insurance industry which moves with the times by offering its customers tailor-made products to satisfy their financial needs is, therefore, essential if we desire to progress towards a worry-free future.

LIBERALIZATION OF INSURANCE SECTOR
Liberalization commitment of the country to help in disciplining future economic policies will include the insurance reforms. When world over insurance market has been opened up. India cannot remain in isolation .History has shown that it is very difficult to prosper in isolation. Globalization is the new economic reality, which is here to stay heralding a new era of Insurance in India. With the opening of the insurance industry, India stands to gain with the following major advantages: Globalization will provide opportunities to the customer for the better production with more reasonable and affordable pricing.  The customer will get quicker services.  It will enhance the saving rate.  Long-term funds for infrastructure development will be available to the country.

 It

will secure for India larger inflow of foreign capital need to sustain

our GDP growth.

Advantages of Liberalization:
Opening up will enable the country to save more and invest more for the development in infrastructure. With new insurance intermediaries and more distribution channels, the market is bound to develop by leaps and bounds. In the next few years it is established that the Indian insurance sector will develop a better understanding of consumer requirement leading to more satisfaction of consumers. The world-class technology will be available in the market bringing about tremendous improvement in servicing. Choice of price will be available to the customers. Lead to increase in employment. 30

Social and rural obligations will also be served as IRDA has come out with clear regulation in the regards, which markets the development in this regards, which makes the development in this mandatory. Global competitors will help in building expertise with their global practice. Unlike west in India, insurance is sold as the instrument of saving. About 18% of the policies are sold as death risk consideration. Impression about LIC is that they are not meant for the market requirements. They are only intended to find customers. Insurance awareness is therefore low .Until linked insurance product are not available insurance covers are expensive and returns are low. Turn over the agent is high. The choice available to the insuring public is inadequate in terms of services, products and prices. These are the areas of weakness, which may act as opportunities for new players who may work to offer policies to the customers with value additions at a competitive premium with much improved servicing.

MAJOR POLICY CHANGES
Reforms in Insurance Sector :
Insurance sector has been opened up for competition from Indian private insurance companies with the enactment of Insurance Regulatory and Development Authority Act,1999 (IRDA Act). As per the provisions of IRDA Act, 1999, Insurance Regulatory and Development Authority (IRDA) was established on 19 April 2000 to protect the interests of holder of insurance policy and to regulate, promote and ensure orderly growth of the insurance industry. IRDA Act 1999 paved the way for the entry of private players into the insurance market, which was hitherto the exclusive privilege of public sector insurance companies/ corporations. Under the new dispensation, Indian insurance companies in private sector were permitted to operate in India with the following conditions:

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Company is formed and registered under the Companies Act, 1956; or

The

aggregate holdings of equity shares by a foreign company, either by itself through its subsidiary companies or its nominees, do not exceed 26%, paid up equity capital of such Indian insurance company; The company's sole purpose is to carry on life insurance business or general insurance business or reinsurance business; The minimum paid up equity capital for life or general insurance business is Rs.100 corers; The minimum paid up equity capital for carrying on reinsurance business has been prescribed as Rs.200 crores.

Protection of the interest of policyholders:
IRDA has the responsibility of protecting the interest of insurance policyholders. Towards achieving this objective, the Authority has taken the following steps: • IRDA has notified Protection of Policyholders Interest Regulations 2001 to provide for: policy proposal documents in easily understandable language; claims procedure in both life and non-life; setting up of grievance redresses machinery; speedy settlement of claims; and policyholders' servicing. The Regulation also provides for payment of interest by insurers for the delay in settlement of claim. • The insurers are required to maintain solvency margins so that they are in a position to meet their obligations towards policyholders with regard to payment of claims. • It is obligatory on the part of the insurance companies to clearly the benefits, terms and conditions under the policy. disclose

•

The advertisements issued by the insurers should not mislead the insuring public. 32

•

All insurers are required to set up proper grievance redress machinery in their head office and at their other offices.

•

The Authority takes up with the insurers any complaint received from the policyholders in connection with services provided by them under the insurance contract.

PRINCIPLES OF INSURANCE
Losses must be uncertain:
The rate of losses must be relatively predictable: In order to set premiums (prices) insurers must be able to estimate them accurately. This is done using the Law of Large Numbers, which states that. The larger the number of homogenous exposures considered, the more closely the losses reported will equal the underlying probability of loss. If the coverage is unique, the insured will pay a correspondingly higher premium.

The Loss must be significant:
The legal principle of De minimizes dictates that trivial matters are not covered. Furthermore, rational insurance uses existing insurance when the transaction costs dictate that filing a claim is not rational.

The Loss must not be catastrophic:
If the insurer is insolvent, it will be unable to pay the insured. In the United States, there is a system of Guaranty Funds run at the state level to reimburse insured people whose insurance companies have become insolvent. [1] This program is run by the National Association of Insurance Commissioners (NAIC). 33

[2] To avoid catastrophic depletion of their own capital, insurers almost universally purchase reinsurance to protect them against excessively large accumulations of risk in a single area, and to protect them against large-scale catastrophes. Additionally, “speculative risks” like those incurred through gambling or through the purchases of company stocks are uninsurable.

LIFE INSURANCE
Life insurance is protection against financial loss resulting from death. It is insurance company's promise to pay your beneficiary a specific amount of money when you die in exchange for timely payment of premiums. Life insurance is a contract that pledges payment of an amount to the person assured (or his nominee) on the happening of the event insured against the person. The contract is valid for payment of the insured amount during:  The date of maturity, or  Specified dates at periodic intervals, or  Unfortunate death, if it occurs earlier. Life insurance is universally acknowledged an institution, which eliminates 'risk', Substituting certainty for uncertainty and comes to the timely aid of the family in the unfortunate event of death of the breadwinner. Mostly, life insurance is civilization’s partial solution to the problems caused by death. Life insurance, in short, is concerned with two hazards that stand across the life-path of every person: 1. That of dying prematurely leaving a dependent family to fend for itself. 2. That of living till old age without visible means of support.

Why do one need life insurance?

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Although one may not think about it, the ability to earn income is a significant asset and life insurance helps replace lost income in the event of your premature death. Here are some reasons people buy life insurance.

The death benefit may be used :
• • • • • To replace income the family would need to maintain their standard of living after the death of a wage earner. To pay off a mortgage loan and other personal and business debts or to create a rent fund. To create a fund for children's education. To pay final expenses, such as funeral costs and taxes. To create a family emergency fund or a fund for a family member with special needs. INDIAN INSURANCE INDUSTRY: NEW AVENUES FOR GROWTH: With an annual growth rate of 15-20% and the largest number of life insurance policies in force, the potential of the Indian insurance industry is huge. Total value of the Indian insurance market (2004-05) is estimated at Rs. 450 billion (US$10 billion). According to government sources, the insurance and banking services' contribution to the country's gross domestic product (GDP) is 7% out of which the gross premium collection forms a significant part. The funds available with the state-owned Life Insurance Corporation (LIC) for investments are 8% of GDP. Till date, only 20% of the total insurable population of India is covered under various life insurance schemes, the penetration rates of health and other non-life insurances in India is also well below the international level. These facts indicate the immense growth potential of the insurance sector.

35

The year 1999 saw a revolution in the Indian insurance sector, as major structural changes took place with the ending of government monopoly and the passage of the Insurance Regulatory and Development Authority (IRDA) Bill, lifting all entry restrictions for private players and allowing foreign players to enter the market with some limits on direct foreign ownership. However, the existing rule says that a foreign partner can hold 26% equity in an insurance company, a proposal to increase this limit to 49% is pending with the government. Since opening up of the insurance sector in 1999, foreign investments of Rs. 8.7 billion have poured into the Indian market and 21 private companies have been granted licenses. 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. The life insurance industry in India grew by an impressive 36%, with premium income from new business at Rs. 253.43 billion during the fiscal year 2009-10, braving stiff competition from private insurers. This report "Indian Insurance Industry: New Avenues for Growth 2012", finds that the market share of the state behemoth, LIC, has clocked 21.87% growth in business at Rs.197.86 billion by selling 2.4 billion new policies in 2009-10. However, this was still not enough to arrest the fall in its market share, as private players grew by 129% to mop up Rs. 55.57 billion in 2009-10 from Rs. 24.29 billion in 2008-09. However, the total volume of LIC's business increased in the last fiscal year (2009-2010) compared to the previous one, its market share came down from 87.04 to 78.07%. The 14 private insurers increased their market share from about 13% to about 22% in a year's time. 36

The figures for the first two months of the fiscal year 2009-10also 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. There are presently 12 general insurance companies with four public sector companies and eight private insurers. According to estimates, private insurance companies collectively have a 10% share of the non-life insurance market. Though the focus of this market research report is on the potential growth on the Indian Insurance Sector, it also talks about the market size, market segmentation, and key developments in the market after 1999. The report gives an instant overview of the Indian non-life insurance market, and covers fire, marine, and other non-life insurance. The data is supplied in both graphical and tabular format for ease of interpretation and analysis. This report also provides company profiles of the major private insurance companies. India's life insurance market set for boom. Wealthier, aging Indians will help transform the country's largely untapped life insurance market into one of the world's fastest growing over the next five years, a global consultancy says. Life insurance is already the most popular financial product among Indians because of the tax benefits and income protection it offers in a country where there is no social security. However, with household earnings accelerating in the fast-growing economy, the life insurance income premiums market could double from 40 billion dollars to 80 billion or even 100 billion dollars by 2012, said McKinsey Co in a report. "All factors are in place for the Indian life insurance industry to blossom into one of the fastest-growing financial services markets in the world," said report co-author Tillman Erhbeck. 37

The potential in the country of 1.1 billion people can be seen from the fact the ratio of life insurance premiums to GDP -- a common measure for penetration -- is 4.1 per cent, far lower than developed market levels of 6-9 per cent. This will change as India sees strongly accelerating household income and a more favorable demographic profile over the next two decades, Household disposable income is seen rising by 5.3 per cent annually, much more than the 3.6 per cent annual growth over the past two decades. With increased GDP, growth there will be more income for consumers to put into life insurance. Research suggests the life insurance industry could witness a rise in insurance sector premiums to between 5.1 and 6.2 per cent of GDP in 2012 from 4.1 per cent. Demand for pension cover is also seen raising, with 113 million Indians expected to be over 60 by 2016, a figure seen swelling to 179 million by 2026. "There is an untapped opportunity" in pensions where life insurance players have no meaningful presence, Just 10 to 11 per cent of India's working population is covered by formal old-age social security schemes. There are currently close to 30 public and private firms in India's insurance market with state-owned Life Insurance Corp of India (LIC) still holding a stranglehold of over 70 per cent. But private players have moved aggressively, chasing for business after being allowed to compete with LIC in 2008. And overseas insurers have raced into the market despite rules limiting foreign direct investment in domestic insurers to 26 per cent.

“The Congress government has been seeking to raise the FDI cap to 49 percent as part of economic reform but its communist allies fiercely oppose such a step”.
LIFE INSURANCE COMPANIES IN MARKET
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LIFE INSURER Public Sector Life Insurance Corporation of India Private Sector Allianz Bajaj Life Insurance Company Limited Birla Sun-Life Insurance Company Limited HDFC Standard Life Insurance Co. Limited ICICI Prudential Life Insurance Co. Limited ING Vysya Life Insurance Company Limited Max New York Life Insurance Co. Limited MetLife Insurance Company Limited Om Kotak Mahindra Life Insurance Co. Ltd. SBI Life Insurance Company Limited TATA AIG Life Insurance Company Limited AMP Sanmar Assurance Company Limited Dabur CGU Life Insurance Co. Pvt. Limited

39

The market share of the above companies can be summarized as following:

40

41

COMPANY PROFILE

ABOUT ALLIANZ

• • • • • • • •

World’s Largest Insurance co. by revenue – Rs55, 00,000 Cr (Euro 96.9 billion). Worldwide 2nd by Gross Written Premiums – Rs4, 77,930 Cr (Euro 89 billion). 3rd largest Assets under Management (AUM) & largest amongst Insurance cos. AUM of Rs 95, 94,200 Cr (Euro 1078 billion). 11th largest corporation in the world. 50%ofglobalbusinessfromLifeInsurance, closeto60million lives insured globally. Established in 1890, 118 yrs of Insurance expertise More than 70 countries, 173,750 employees worldwide. Insurance to almost half of the Fortune 500 cos.

ACHIVEMENT OF BAJAJ ALLIANZ
• • • • • • Most Profitable Pvt. Life Insurance Co Rs.63cr (US $ 15.3 mn.) profit for FY 06-07 Over 2 million (20, 79,217) policies in this year – highest amongst all put. Sector players and taking the number 1 position. Have sold over 3.4 million policies (34, 72,875) issued till date. Largest distribution network to reach the customers across the country with 2,13,000 agents, present in over 1000 towns, 200 corporate agents & Banc assurance partners Accelerated Growth 42

• • • • • • • • •

Fiscal Year

No of policies o sold in FY

New Business in FY

2003-2004 (6mths) 21,376 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 1, 15,965 1, 86,443 2, 88,189 7, 81,685 37, 44,742

Rs

7 cr. Rs Rs Rs Rs Rs 69 cr. 180 cr. 857 cr. 2717 cr.

6675 cr.

Assets under management Rs 5,500 cr. Shareholder capital base of Rs 700 cr.

BAJAJ GROUP

The Bajaj Group is one of the leading business houses of India. Its business interests span host of industries such as automobiles (two-wheelers and three-wheelers), home appliances, lighting, iron and steel, insurance, travel and finance. The Bajaj brand is well-known in over a dozen countries in Europe, South America, the US and Asia. The Bajaj Group comprises 27 companies and its flagship company Bajaj Auto is ranked as the world's fourth largest twoand threewheeler manufacturer.

Bajaj Group was founded in 1926, at the height of India's movement for independence from the British. Jamnalal Bajaj, founder of the group, was a close associate of Mahatma Gandhi. Jamnalal Bajaj's close involvement in the freedom movement did not leave him with much time for his business. In 1942, his son Kamalnayan Bajaj took charge of the business. He consolidated the group and diversified into various manufacturing activities. Rahul Bajaj, the present Chairman and Managing Director of the group took reins of the business in 1965. Under his leadership the group has achieved new heights and ranks among the top 10 business houses in India.

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 Bajaj Auto Ltd, the flagship company of the Rs. 8000 crore Bajaj group is the largest manufacturer of two-wheelers and three-wheelers in India and one of the largest in the world.  A household name in India, Bajaj Auto has a strong brand image & brand loyalty synonymous with quality & customer focus.  A STRONG INDIAN BRAND- HAMARA BAJAJ  One of the largest 2 & 3 wheeler manufacturer in the world  21 million+ vehicles on the roads across the globe  Managing funds of over Rs 4000 cr.  Bajaj Auto finance one of the largest auto finance cos. in India

BAJAJ AUTO 74% + ALLIANZ 26%

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PRODUCT OF THE COMPANY
A comprehensive list of policies and products offered by Bajaj Allianz Life Insurance Co. Ltd. is as follows:
• • • • • • • • • • • • • • • • • • • • • • • •

Unit Linked Plans Regular Premium New UnitGain Super UnitGain Plus Gold New UnitGain Plus New UnitGain YoungCare YoungCare Plus New FamilyGain-R Single Premium New UnitGain Premier SP New UnitGain Plus SP Pension Plans Annuity Pension Guarantee Retirement Future Income Generator Swarna Vishranti New UnitGain Easy Pension Plus RP New UnitGain Easy Pension Plus SP Future Secure Traditional Plans Endowment InvestGain 45

• • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • •

SaveCare Economy SP Life Time Care Super Saver Money Back CashGain Term Plans Protector Term Care New Risk Care Women Insurance Plans House Wives Working Women Health Plans Care First Health Care Family CareFirst Children Plans ChildGain Group Plans Non Employer Employee Credit Shield Group Term Life(Non Employer Employee) Group Suraksha Swayam Shakti Suraksha Group Loan Protector Group Income Protection Employer Employee Group Term Life(Employer Employee) New Group Gratuity Care New Group Superannuation Care Group Save Plus Group Term Life in lieu of EDLI Group Leave Encashment Scheme 46

• • • • • • •

Group Annuity Group Superannuation Gold Group Gratuity Gold Micro Insurance Alp Nivesh Yojana Jana Vikas Yojana Saral Suraksha Yojana

Other Plans
• • • •

Family Assure Fortune Plus Capital Shield Century Plus II various insurance products of competitors include

The

Individuals Plans
           

Unit Gain Insurances Term Care Plans Lifetime Care Insurance Policy Business Insurance Policies Savings And Security Policies For You And Your Family Rural Insurance Plan Healthcare Insurance Financial Insurance Pension Plus Retirement Plans Children's Policies Endowment Plans and many more.

Group Insurance Schemes 47

    

Insurance For Employee-Employer Groups Insurance For Non-Employer - Employee Groups Employees Deposit Linked Insurance New Group Superannuation Scheme New Group Gratuity Care Scheme

Special Insurance Policies for NRI's
  

Invest gain Endowment Plan Cash gain Money Back Plan ·Child gain Kids Special Plan

MISSION,VISION AND COMPANY ACHIEVEMENT:
Vision

• To be the first choice insurer for customers • To be the preferred employer for staff in the insurance industry. • To be the number one insurer for creating shareholder value

Mission
As a responsible, customer focused market leader, we will strive to understand the insurance needs of the consumers and translate it into affordable products that deliver value for money. A Partnership Based on Synergy Bajaj Allianz General Insurance offers technical excellence in all areas of General and Health Insurance as well as Risk Management. This partnership successfully combines Bajaj Finserv's in-depth understanding of the local market and extensive distribution network with the global experience and technical expertise of the Allianz Group. 48

As a registered Indian Insurance Company and a capital base of Rs. 110 crores, the company is fully licensed to underwrite all lines of general insurance business including health insurance.

COMPANY ACHIEVEMENTS: Bajaj Allianz has received "iAAA rating, from ICRA Limited, an associate of Moody's Investors Services, for Claims Paying Ability.This rating indicates highest claims paying ability and a fundamentally strong position Bajaj Allianz life Insurance has received the prestigious “Business Leader in life Insurance”, awarded by NDTV Profit Business Leadership Awards 2009. The company was one of the top three finalists for the year 2008 and 2009 in the General Insurance Company of the Year award by Asia Insurance Review. Competitors of Bajaj Allianz Insurance: Insurance Companies in India Top Insurance Companies Life Insurance Companies Home Insurance Companies GIC AMP Sanmar Aviva Life Bharti AXA Birla Sun Life 49

Canara HSBC OBC Citibank Travel Insurance Citifinancial Auto Insurance GE Money HDFC Life Insurance ICICI Insurance Co. ICICI Insurance Schemes ICICI Prudential ICICI Lombard ICICI Life Insurance ING Vysya Kotak Mahindra Max New York Metlife Reliance General Insurance Reliance Life Reliance Standard Life Reliance Standard Insurance Royal Sundaram Sahara Life SBI Life 50

Shriram Life Tata AIG

51

BAJAJ ALLIANZ LIFE INSURANCE COMPANY LIMITED
I R D A REGISTATION NO. 116 DATED:-03.08.2001

THE POWER OF YOUR SIDE YOUR VISION to be the best insurance company in india.

OUR VALUE

*Customer delight the guiding principle *Ensuring world class solution and services *Offering customized products *Transparent benefits

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MARKETING ANALYSIS OF THE COMPANY

For the year (2009-10) Table No.1:-Sale of Private and LIC in various year After 5 years of opening up of the Indian life insurance industry to foreign JVs, the share of private players have gone up to 28.6% at the end of FY 2009-10 from 1.4% in FY 2007-08.This is because unlike China, which imposed severe licensing restrictions, the single licensing norm has seen new breed of insurance companies established itself and grow market share by rapidly increasing the premium base. The life insurance market has registered a growth of 35% in terms of new business during the FY 2009-2010 over previous year.

100 90 80 70 60 50 40 30 20 10 0

LIC Private

2005- 2006- 2007- 2008- 200906 07 08 09 10
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Table-2: Performance by Policy Count (2009-2010) LIC sold the most number of policies… In terms of policy count, the share of private players is just 10.8%. LIC accounts for 92.3% of the new policies

100 90 80 70 60 50 40 30 20 10 0 Private LIC 2009-10

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POLICY TYPE New Business Premium by Type of Policy (percentage)…

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Table No.:-3 Product Mix of various companies Product Mix…

Insurers 2001-02 2002-03 2003-04 2004-05 2005 Although life insurance penetration still at 2.53% at the end of year 2004, India offers abroad range of products covering term insurance to savings related products. Most of the insurers are now focusing on unit-linked plans backed by the impressive stock market performance. Most products are sold to individuals, which accounts for 86% of the new business

57

Table No.:-4 Existing Players in the Market…

58

Chart 9: Market Share APE

70 60 50
s

40 30 20 10 0 FY09 FY10

Private LIC

Market Trend: New Business Premium Growth Month on Month 06-0 7 The insurance sector has ended FY07 with new business premium of Rs 754065 mn a growth of 94.4% when compared with FY06.The new business collection has seen consecutive dip in the month of Dec 06, Jan07 & Feb 07. However, the month of March has seen a growth of 292%. LIC has recoded 404% growth in new business collection in the month of Mar 07 when compared with Feb 07.Private sector on the other hand has witnessed a growth of 155% of new business in the month of Mar 07

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Table 10: New Business Premium Market Share (%) Insurers FY01 FY02 FY03 FY04 FY05 FY06 FY07
AM Sanm P ar 1.5% IN V G ysya 2.1% M etLife A viva IC ICI 1.2% MN YL 4.5% Prudential 5.1% 31.8% T A ata IG 7.3% HD Std. Life FC 7.7% SBI Life 10.2% Bajaj A llianz 11.5% Birla Sunlife 14.4% Kotak 2.9%

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SWOT ANALYSIS OF LIFE-INSURANCE INDUSTRY
STRENGTH:
• • • • • • • • • Sector with greatest potential today. Predicted annual growth rate 18-20% Life insurance industry in India grew by an impressive 36%, with premium income from new business at Rs.253.43 billion during the fiscal year 2004-2005. Tax benefits under section 80 are given on insurance products. Insurance has emerged as an attractive and stable investment alternative that offers total protection for life, health, and wealth. Unit linked plans. Strong saving culture in India. Insurance products flexibility i.e. one can shift from one plan to another. Life insurance provides inflation protection.

WEAKNESS:
• Difficulty in development of industry code of conduct, contributing to a common catastrophe reserve fund and chalking out agreements to settle claims to the benefit of customer. • • Insurance products in India are not perceived as an investment instrument. Few product changes have taken place since nationalization.

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OPPORTUNITY:
• • • • More than one billion population. 80% market untapped. India has an enormous middle-class that can afford to buy life, health, and disability and pension plan products. Low level of penetration of life insurance in India compared to other developed nations.

THREAT:
• • • • Lack of awareness in rural India about life insurance policies. To convince a large population, which is comparatively not well informed about the intangible benefits of life insurance, is indeed difficult task. Competition with other instruments of investment. So there will be need to provide returns comparable to other financial instruments. Investment management.

62

63

DATA ANALYSIS After collection of data, the analysis of it was done through various graphs: Doughnut  Pie Diagram  Bar Diagram  Tubes  Cones According follows: Research process: Stage Ist Understanding the project: to the data collected through survey with the help of

questionnaire, the break up with respect to income of individuals is as

Firstly I was enriched with the philosophy of investment and insurance. secondly I tried to understand that what made investors comfortable in making investments in insurance sector and which are the major insurance schemes in which investors commonly used to invest and Stage 2 n d Problem definition

64

The objectives were set and sampling, methodology and determined. I along with the expert guidance of my project guide prepared a well- designed questionnaire.

Stage 3 r d Research design Decision regarding what, where, when, how much to invest for getting higher returns with minimum risks and by what means? The research design encompasses the following information.

Data source: data collected was primary as it was collected by means of questionnaire consisting from various investors.

Research instrument : Structured questionnaire consisting of open-ended questions were used for used for purpose of research. Contact method : personal interview

Research approach: field survey

Research type: conclusive (descriptive) a descriptive approach has been adopted in the study. The data has been generated through extensive survey method.

Scope of research : City of Kanpur. 65

Stage 4 t h : Data collection . I visited the city of Kanpur. Here data collection was done by the way of questionnaire. I met various investors, direct selling, and agents and queried regarding the questions in the questionnaire . In the totality 25 respondents were visited by me. The various parameters on which the investors were: • • • • • • • • Investment in insurance schemes Most preferred insurance scheme for investment and risk cover Returns of insurance schemes Dominating influence in financial decision making Criteria for investment and insurance evaluation Minimum time period for blocking the funds Satisfaction towards investment in insurance schemes Risk involved investment and insurance schemes.

Sampling design . It encompasses the following information. Sampling universe : Investors of various insurance companies. Sample size : 100 Sample procedure : Purposive, judgment, and selective sampling Sampling type : convenient sampling

66

Stage 6 t h Data analysis : Data until analyzed is of no use. Analysis was done in the order of investors visited and then a consolidated analysis was done (refer to annexure)

Stage 7 t h : Data interpretation : Data was interpreted and inferences were drawn and transformed to meaningful information to help management to get a vivid picture and to make accurate decision there from.

METHOD EMPLOYED The approach to the research is considered in this chapter, from the theoretical underpinning to the collection and analysis of the data. It begins with the extent of the research to provide the specific guidelines of studying. The next part is concerned with the method of the research that refers to the data collection and analyzing which is used in the research. 67

METHODS
PRIMARY DATA:
Date collection for this research was done primarily through filling up of questionnaire. The sample for the research including different individuals of various age groups and having different professions and qualifications. Data was collected through the interview of individuals. The questionnaire was containing questions regarding the personal details of individuals and then some light questions regarding their primary knowledge related to private insurance companies. Then there were questions related to their interest in being the Insurance Consultants of company.

SECONDARY DATA :
A large amount of secondary data has been collected from secondary sources. Some of the sources are: Reports on Insurance Sector of India.  Articles from Newspapers and magazines.  Various web sites of the insurance companies and related sites.

DATA ANALYSIS:
68

There are some features of analyzing data that need to be borne in mind when choosing the method for analyzing the research. The questionnaires were prepared to explore the psychology of individuals about being associated BAJAJ ALLIANZ Life Insurance as Insurance Consultants and to help the company grow by increasing its sales. Instead of testing a hypothesis, a qualitative analyst may demonstrate evidence showing that a theory, generalizing, or interpretation is plausible.

SAMPLE SIZE :Various areas of Kanpur were covered in order to fill the

questionnaire. I interacted with 100 individuals in order to know about their interest of being Insurance Consultants of BAJAJ ALLIANZ Life Insurance.

SAMPLE COMPOSITION:
 Youth  Executives  Serviceman  Business persons

RESEARCH DESIGN :
A research design provides the framework to be used as a guide in collecting and analyzing data.

TYPES OF RESEARCH:
The basic types of research are as follows:

69

Descriptive vs . analytical :

descriptive research includes surveys and fact-

finding enquiries of different kinds. The major purpose of descriptive research is description of the state of affairs as it exists at present. In analytical research, on the other hand, the researches have to use facts or information already available and analyze these to make a critical evaluation of the material.

Applied vs. fundamental : research can either be applied (or action) research or fundamental (or basic or pure) research. Applied research aims at finding a solution for an immediate problem facing a society or an industrial/ business organization, whereas fundamental, research is mainly concerned with generalizations and with the formulation of theory. Quantitative vs. quantitative : quantitative research is based on the

measurement of quantity or amount. It is applicable to phenomena that can be expressed in terms of quantity. Qualitative research, on the other hand, is concerned with the qualitative phenomena, i.e., phenomena relating to or involving quality or kind. Conceptual vs. empirical : conceptual research is the one that is related to some abstract idea (s) or theory. It is generally used by philosophers and thinkers to develop new concepts or to reinterpret existing ones. On the other hand, empirical research relies on experience or observation alone, often without regard for system and theory. It is data based research. Coming up with conclusions which are capable of being verified by observation or experiment. Other: all other types of research are variation of one or more of the above stated approaches, based on either the purpose of research, or the time required to accomplish research, or the environment in which research is done, or on the basis of some other factor. From the point of view of time, we can think of research either as one time research or longitudinal research. In 70

the former case, the research is confined to a single time period, whereas in the latter case, the research is carried over a span of time.

s

APPROACHES
• • • • • • • Consultative Selling Process Complete Product Range Superior Customer service Well trained & quality Advisor force Target Urban households Affluent & HNW customer segment via Tied Agency & select Banks Mass segment via Public Sector banks & other Corporate Agents

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18-25 yrs 26-30 yrs 31-40 yrs 41-50 yrs 51-60 yes

CLASSIFICATION ON THE BASIS OF PREFERENCE FOR LIC AND PRIVATE PLAYERS :
The age group classification through which the survey was conducted, is as follows  18-25  26-30  31-40  40-50  50-60+ In the above mentioned age groups, various people were asked of their preferences among L.I.C. and the other private players prevalent these days. Then percentage of people who preferred LIC and percentage pf people preferring private companies was sorted out by the compiler. This analysis

72

was just on the basis of preference of the customer and not on the actual companies they have invested their money. The results obtained were as follows:

100 80 60 Private 40 20 0 LIC

18-25

26-30

31-40

41-50

50-Above

CLASSIFICATION OF PREFERENCE FOR LIC AND PRIVATE COMPANIES IN TOTALITY:
Out of the total 50 respondents covered by the compiler, some of the people preferred LIC and some others preferred private players. But without a proper representation of those preferences in terms of percentages, the report would be ineffective. So here is the representation of the facts obtained by the survey conducted, this analysis is only on the basis of the preference of the customers. 73

private 27% private LIC LIC 73%

CLASSIFICATION AWARENESS :

ON

THE

BASIS

OF

INSURANCE

Out of the total respondents the percentage of people who were insured, be it they alone or with their families, has been short listed below:

AGE OF RESPONDENTS

% INSURED 74

18-25 26-30 31-40 40-50 50-60

66.67% 100% 100% 85.71% 83.33%

100.00% 90.00% 80.00% 70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00%

% insured

18-25 26-30 31-40 40-50 50-60 yrs yrs yrs yrs yrs

CLASSIFICATION

ON

THE

BASIS

OF

INSURANCE

AWARENESS IN TOTALITY:

Out of the total respondents visited by the compiler, the percentage of people insured in totality, was as follows:

% respondents insured % respondents not insured

88% 12%

75

90 80 70 60 50 40 30 20 10 0

insured, 88

insured non insured non insured, 12 insured non insured

ACTUAL CLASSIFICATION ON BRAND LOYALTY
In this category, it was analyzed in which sector had the respondents actually invested their money, in private companies or in L.I.C? Though earlier they preferred LIC for investment and insurance, the actual results obtained were excitingly different from the preferences of the respondents. The results obtained were as follows: AGE OF RESPONDENTS 18-25 26-30 % INSURED WITH LIC 0% 33.33% 76

30-40 40-50 50-60

66.67% 42.85% 83.33%

90% 80% 70% 60% 50% 40% 30% 20% 10% 0%

% insured with LIC

18- 26- 30- 40- 5025 30 40 50 60 yrs yrs yrs yrs yrs

INCOME WISE CLASSIFICATION.

The total number of respondents covered by the compiler was categorized income wise into various segments. These segments are as follows:

Income of respondents 1-2 lakh 2-3 lakh 3-4 lakh 4-5 lakh $ above

No of respondents 28 36 32 4

77

40 35 30 25 20 15 10 5 0

Salary

1-2 lakh

2-3 lakh

3-4 lakh

above 4 lakh

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INTERPRETATION OF DATA

 Age Group Classification.  Classification on the basis of preference for LIC and Private Companies.  Classification on the basis of preference for totally.  Classification on the basis of Insurance awareness.  Classification on the basis of Insurance awareness in totally.  Actual Classification on Brand loyalty.  Income wise Classification

AGE GROUP CLASSIFICATION .

Maximum number of respondents belonged to the age group 4050(28%). But mature people of the age group 31-40 were also covered by the compiler which contributed up to 12%. Apart from this, respondents belonging to the age group 18-25 and 26-30 were included as well, which formed the proportion of 12% and 24% respectively. Not excluding the senior citizens group belonging to the age group 50-60 and above, which formed a major sector contributing up to 24%? All these depict the wide area of respondents covered by the compiler.

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FINDINGS



People are becoming more & more money conscious as I didn’t find any person who doesn’t want to earn extra money.



People are very much aware of ICICI Prudential among private companies and LIC in public sector as they respond me first name of LIC then ICICI prudential and then others.



The overall scenario is that still people trust on LIC more than any other insurance company. Sometimes when I asked someone to become an agent of Bajaj Life Insurance they misunderstood with LIC. For them still life insurance means LIC.



Contrary of the prior thinking most of the people don’t hesitate in doing field work a roaming in the market. They know that without hard work they can’t earn money.



There were many respondents who were not interested in attending seminar conducted by Bajaj Life Insurance among Indian Market.

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CONCLUSION
The Bajaj insurance company is entering into booming here. To increase the market share in insurance time-to-time research projects are undertaken and this prefects was endeavor in that direction. To conclude their can't be two ways about Bajaj Life Insurance , commanding a very good brand image Growing at a breakneck pace with a strong pan Indian presence Bajaj Life Insurance has emerged as a strong player in India. Characterized by global presence with a local focus driven by customer orientation to establish high earnings potential and financial strength. Through the survey conducted by me, I reached the following conclusions: Among all the people visited by me a major proportion of the respondents were insured. The people belonging to the age group 4050 and above have a general feeling and inclination towards LIC. They have an in-depth feeling that with LIC their money is safe. People are not aware of the fact that all the insures prevailing these day, have a large part of their money invested with IRDA kept as a security and they all follow the general rule and guidelines laid down by IRDA, and that too vary strictly. On the other hand, the youngsters and the people belonging top the age group 30-40 understand that their money will grow unto a better extent in private insurer because their management is such that they offer greater and better opportunities for exploitation and so they have invested their money in private insurers and not much in LIC if at all they have invested. A lot is stall to be done to make the people aware for insurance and to eradicate the general feeling imbibed in the people that insurance is not for their benefit but for the benefit of the company alone.

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SUGGESIONS



There should be focus on advertisements through T.V. or other Electronic Media.



Make use of internet banking for increasing sales, and also for promotion.



They should increase their Distribution Channels by more & more tie ups with the locals banks also, because they can help them to penetrate in Indian market easily.



There should be more incentives to IC’s as they are the backbone of the company in order to increase sales they have to do more efforts than others.

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LIMITATION OF THE STUDY

It is well known fact that constraints and limitation are bound to present in any study do this also has some limitation as: 1. It is very difficult to make the people understand the significant of conducting survey. 2. Lack of knowledge of area has also affected the research. 3. Due to shortage of monitory resources the project report does not reach to its perfection. 4. Market share can fluctuate for much minor reason. 5. Sometimes people don't give the clear answer during the survey. 6. The people are much faith on L.I.C

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QUESTIONNAIRE
Dear sir/ mam, I would request you to kindly respond to the following questionnaire. This study is meant exclusively for academic purpose. I would like to extend my deed sense of gratitude for providing valuable insight that surely help in enriching my knowledge about today’s investment trend and also customer’s perception about the invasion of private companies in the scenario.

Personal details Name………………….. Age………………………… Occupation……………………. Address……………………….. Phone number………………….

1. How many members are there in your family? 2. How many earning members are there in your family? 3. What is the annual income of your family? 4. Are you conscious of yourself and your family? YES [ ] NO [ ]

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5. Which mode of investment do you prefer the most? • • • • • • YES [ ] YES [ ] • • • • • • Insurance Gold Equity Mutual funds Others: land Capital NO [ ] NO [ ] Long term Short term Both None

6. Do you know about ULIP? 7. Do you assess tax? 8. Which type of investor are you?

9. Which sector do you prefer the most for investment? Government Private.

10. In private players whom do you like the most and why on the Basis of: Returns [ ] ] 11. Do you think that in present scenario people are diverting for investment towards private players? Yes [ ] and your family? Yes [ ] no [ ] 13. Do you think insurance is good for future protection? 92 no [ ] 12. Have you taken any insurance and investment tool for your self services [ ] safety [ ] features [

Yes [ ]

no [ ]

14. Do you have any investment with any private insurance company? Yes [ ] • • • • • • • Returns Services Better products Flexibility Transparency Face value of relatives Others YES [ ] 1) 2) 3) 4) 5) 18. Have you taken any policy from LIC? Yes [ ] 19. If yes then why? 20. Do you think that the market share of LIC is decreasing day by day? Yes [ ] private players? Yes [ ] THANK YOU!!!! 93 no [ ] no [ ] 21. Do you know any person who has switched from LIC to any No [ ] NO [ ] no [ ] 15. If yes, then why? On the basis of:

16. Do you think private companies have created an impact on LIC? (17) Mention any four companies in order of preference?

ORGANIZATIONAL STRUCTURE

STRUCTURE OF THE ORGANIZATION
The company owes its success to its strong management team, most of which has been there since its inception.

Organization Structure:
National Sales and Marketing Head

Vice President-Investment s Assistant Vice President-Investment Zonal manager investment Senior Investment manager Manager Investment

Vice President-Sales Assistant Vice President-Sales Regional Sales Head Branch Manager Team Leader

Relationship Manager Associate Relationship Manager

Asst. Relationship Managers

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Relationship Executive.

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BIBLIOGRAPHY

LIFE INSURERS Life Insurance Corporation of India ICICI Prudential Life Insurance Co. Limited Birla Sun-Life Insurance Company Limited HDFC Standard Life Insurance Co. Limited ING Vysya Life Insurance Company Limited MetLife Insurance Company Limited Om Kotak Mahindra Life Insurance Co. Ltd. TATA AIG Life Insurance Company Limited BAJAJ ALLIANZ LIFE INSURANCE CO. LTD. Cholamandalam General Insurance Co. Ltd. Insurance Regulatory Development Authority Life Insurance Corporation of India Royal Sundaram Alliance Insurance Co. Ltd. Insurance Regulatory Development Authority

Websites www.licindia.com www.iciciprulife.com www.birlasunlife.com www.hdfcinsurance.com www.ingvysayalife.com www.metlife.com www.omkotakmahnidra.com www.tata-aig.com www.bajajallianz.co.in www.cholainsurance.com www.irdaindia.org www.licindia.com www.royalsun.com www.irdaindia.org

BOOKS REFERRED:  Marketing management by Mr. Philip Kotler. 97

 Principles of marketing by Mr. Richard Armstrong.  Marketing Strategy and Management by Mr. Michael J. Baker.  Marketing Channels by Mr. Louis Stern  Business Research Methodology by Mr. C.R. Kothari.

BUSINESS MAGAZINE & NEWS PAPER:

  

The Times of India The Economic Times 4Ps, Pitch, Business & Economy

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