MKTG an Analysis of Indian Insurance Industry With Special Reference to HDFC STANDARD Life Insurance...

7/28/2019 MKTG an Analysis of Indian Insurance Industry With Special Reference to HDFC STANDARD Life Insurance Company

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RESEARCH PROJECT

ON

An Analysis of Indian Insurance Industry with Special

Reference to HDFC STANDARD life Insurance Company

(A Case Study of Chandigarh)

SUBMITTED IN PARTIAL FULFILLMENT OF

DEGREE OF

MASTERS OF BUSINESS ADMINISTRATION

SESSION (2009-2011)

PAPER CODE-(CP-402)

SUBMITTED BY SUBMITTED

TO:

Ms SHILPA CHOPRA KHUSHI RAM{Assistant Professor}

MBA 4th SEM

University Roll No.

SUBMITTED TO

ICL INSTITUTE OF MANAGEMENT AND TECHNOLOGY

SOUNTLI


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(KURUKSHETRA UNIVERSITY, KURUKSHETRA)

ACKNOWLEDGEMENT

Gratitude is the hardest of emotions to express and one often does not find adequate

words to convey what one feels and trying to express it

The present project file is an amalgamated of various thoughts and experiences .The

successful completion of this project report would have not been possible without the

help and guidance of number of people and especially to my project guide Ms. Shilpa

Chopra Assistant Professor, ICL, for his illumining observation, encouraging

suggestions and constructive criticisms, which have helped me in completing this

research project successfully. There are several other people who also deserve much

more than a mere acknowledgement at their exemplary help. I also acknowledge with

deep sense of gratitude and wholehearted help and cooperation intended to me by them.

KHUSHI RAM


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PREFACE

Research Project is the bridge for a student that takes him from his theoretical knowledge

world to practical industry world. The main purpose of it is to expose for industrial and

business environment, which cannot be possible in the classroom.

The advantages of this sort of integration, which promotes guided to corporate culture,

functional, social and norms along with formal teaching are numerous.

1) To bridge the gap between theory and practical.

2) To install the feeling of belongingness and acceptance.

3) To help the student to develop the better understanding of the concept and

questions already raised or to be raised subsequently during their research period.

The present report gives a detailed view of the.An Analysis of Indian Insurance

Industry with Special Reference to HDFC STANDARD Life Insurance

Company.

The research is definitely going to play an important role in developing an aptitude for

hard self-confidence.


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DECLARATION

I hereby declare that, the project entitled An Analysis of Indian Insurance

Industry with Special Reference to HDFC STANDARD Life Insurance

Company assigned to me for the partial fulfillment of MBA degree from KurukshetraUniversity, Kurukshetra. The work is originally completed by me and the information

provided in the study is authentic to the best of my knowledge.

This study has not been submitted to any other institution or university for the award of

any other degree.

Khushi Ram

MBA 4th SEMUniversityRoll No.

.


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CERTIFICATE

This is to certify that KHUSHI RAMhas completed the project entitled An Analysis

of Indian Insurance Industry with Special Reference to HDFC

STANDARD Life Insurance Company under my supervision. To the best of myknowledge, the report consists of result of the empirical study conducted by the student.In my opinion, the work is of requisite standard expected of an MBA student. Therefore,I recommend the same to be sent for evaluation.

Ms.Shilpa Chopra

{Assistant Professor}


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TABLE OF CONTENTS

I. Acknowledgement

II. Abstract

Chapter 1: Introduction

1.1 Objectives of the project

1.2 Scope of the study

Chapter 2: Introduction to insurance industry2.1 Insurance industry in India2.2 Evolution of Insurance in India2.3 Insurance Regulatory Development Authority2.4 Capital Requirements and Foreign Participation

Chapter 3: HDFC STANDARD Life Insurance Co. Ltd.

3.1 Management Team3.2 Types of Plan

3.3 Michael Porter model

Chapter 4: Comparative study

4.1 Comparison of various companys products

4.2 Market share of various companies

4.3 SWOT Analysis

Chapter 5: Research Methodology

Chapter6: Micro Analysis


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6.1 Finding, analysis and Interpretation6.2 Limitations of the project

Chapter7: Macro analysis

7.1 Conclusion

7.2 Recommendation

Bibliography

Annexure

CHAPTER - 1

Insurance An Introduction

Insurance may be described as a social device to ensure protection of economic value of

life and other assets. Under the plan of insurance, a large number of people associate

themselves by sharing risks attached to individuals. The risks, which can be insured

against, include fire, the perils of sea, death and accidents and burglary. Any risk

contingent upon these, may be insured against at a premium commensurate with the risk

involved. Thus collective bearing of risk is insurance.

Insurance is a contract whereby, in return for the payment of premium by the insured, the

insurers pay the financial losses suffered by the insured as a result of the occurrence of

unforeseen events. The term "risk" is used to describe the possibility of adverse results

flowing from any occurrence or the accidental happenings, which produce a monetary

loss.


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Insurance is a pool in which a large number of people exposed to a similar risk make

contributions to a common fund out of which the losses suffered by the unfortunate few,

due to accidental events, are made good. The sharing of risk among large groups of

people is the basis of insurance. The losses of an individual are distributed over a group

of individuals.

Definitions:

General definition:

In the words of John Magee, Insurance is a plan by themselves which large number of

people associate and transfer to the shoulders of all, risks that attach to individuals.

Fundamental definition:

In the words of D.S. Hansell, Insurance accumulated contributions of all parties

participating in the scheme.

Contractual definition: In the words of justice Tindall, Insurance is a contract in

which a sum of money is paid to the assured as consideration of insurers incurring the

risk of paying a large sum upon a given contingency.

Characteristics of Insurance

Sharing of risks


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Cooperative device

Evaluation of risk

Payment on happening of a special event

The amount of payment depends on the nature of losses incurred.

The success of insurance business depends on the large number of people insured

against similar risk.

Insurance is a plan, which spreads the risk and losses of few people among a large

number of people.

The insurance is a plan in which the insured transfers his risk on the insurer.

Insurance is a legal contract which is based upon certain principles of insurance

which includes, utmost good faith, insurable interest, contribution, indemnity, causas

proxima, subrogation, etc.

The scope of insurance is much wider and extensive.

Functions of Insurance:

Primary functions:

1. Provide protection:- Insurance cannot check the happening of the risk, but can

provide for the losses of risk.

2. Collective bearing of risk: - Insurance is a device to share the financial losses of few

among many others.

3. Assessment of risk: - Insurance determines the probable volume of risk by evaluatingvarious factors that give rise to risk.

4. Provide certainty: - Insurance is a device, which helps to change from uncertainty to

certainty.

5. Tax benefit :- Insurance is a source which reduce tax.


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Secondary functions:

1. Prevention of losses: - Insurance cautions businessman and individuals to adopt

suitable device to prevent unfortunate consequences of risk by observing safety

instructions.

2. Small capital to cover large risks: - Insurance relives the businessman from security

investment, by paying small amount of insurance against larger risks and uncertainty.

3. Contributes towards development of larger industries.

The evolution of Insurance in India can be summarized as:

Year Changes

1818 Oriental Insurance Company. The first Insurance company in India

1870 Bombay Mutual Life Assurance Company. First Indian Insurance company.

1912 The Indian Life Assurance Company enacted the first law to regulate the life

insurance business in India

1926 The Indian Assurance company act enacted to enable the government to collect

the statistical information about the insurance.


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1938 The earlier legislation consolidated and amended the life insurance act with

the objective of protecting the interest of insurance in the public.

1956 245 Indian and foreign players and prudent societies are taken once by Central

govt. And nationalized

2000 FDIs are allowed to come and entered into the insurance business.

2002 There are total 16 insurance companies are available out of which two are

Government companies.

2009 There are total 22 companies are available in the market out of which 3 are wholly

Indian companies.

1.5 RELATED ACTS

The insurance sector went through a full circle of phases from being unregulated to

completely regulated and then currently being partly deregulated. It is governed by a

number of acts, with the first one being the Insurance Act, 1938.

1.5.1The Insurance Act, 1938

The Insurance Act, 1938 was the first legislation governing all forms of insurance to

provide strict state control over insurance business.

1.5.2 Life Insurance Corporation Act, 1956


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In 19 January 1956, life insurance in India was completely nationalized, through a

Government ordinance; the Life Insurance Corporation Act, 1956 effective from 1.9.1956

was enacted in the same year to, inter-alia, form LIFE INSURANCE CORPORATION

after nationalization of the 245 companies (both Indian and foreign origin) into one

entity. The Life Insurance Corporation of India was created on 1st September, 1956.

1.5.3 Insurance Regulatory and Development Authority (IRDA) Act,

1999

Till 1999, there were not any private insurance companies in Indian insurance sector. The

Govt. of India, then introduced the Insurance Regulatory and Development Authority Act

in 1999, thereby de-regulating the insurance sector and allowing private companies into

the insurance. Further, foreign investment was also allowed and capped at 26% holding

in the Indian insurance companies. In recent years many private players entered in the

Insurance sector of India. Companies with equal strength competing in the Indian

insurance market. With more and more private players in the sector this scenario may

change at a rapid pace.

INSURANCE IN INDIA:

It is a means of savings and investment apart from it its share in the GDP counts veryimportant. In India it is in a growing stage in compare of the other countries lets have alookon it:-

United Kingdom 8.9%Japan 8.3%


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Korea 7.3%United States 4.1%Malaysia 3.6%India 3.0%China 1.8%

Brazil 1.3%

If we talk in terms of India only then the result will be something like this:


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Working of Life Insurance: -

Risk has to be assessed in order to decide tithepremium or to decide that subject is insurable or not.

Pure Risk vs. Speculative Risk:

Event representing there will be possibility of loss or no loss is called pure risk. Theserisks are insurable in nature.

Speculative risk is the one which truly resembles gamble. There is the possibility of lossor gain and wherever there is a chance of making profit there insurance cannot exist.Therefore these risks are not insurable in nature.

Approaches to Risk Management:

Risk Management is the process of minimizing the risk due to unforeseen events. StepsInvolved in selecting the Risk Management are:

To identify all the things that can be possibly wrong. To consider possibility that an event can occur.


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Techniques toward the Risk Management;

1. Avoiding the Risk: - Risk can be managed by avoiding it as when the perils will come

then it will be managed.2. Eliminate the Risk: - Risk can be managed by eliminating the cause of the loss.3. Reducing the Risk: - Risk can be reduced by handling them in a systematic manner.4. Transfer of Risk: - Risk can be minimized by transferring the risk of loss to any other

Person which is a true form of the INSURANCE.


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CHAPTER 2

HOUSING DEVELOPMENT FINANCIAL CORPORATION

HOUSING DEVELOPMENT FINANCE CORPORATION ( HDFC )

Mumbai based Housing Development Finance Corporation was incorporated in 1977 by

H.T. Parekh, founder chairman of ICICI which has grown to be India's leading housing

finance company.

Its services are aimed at individuals as well as companies availing loans for housing

purposes. It also provides lease finance to companies and to development authorities for

financing infrastructure and other assets along with its property related services.

2.1 Vision and Mission of the organization

"HDFC is an organization that strives for excellence, with the twin objectives of

enhancing customer satisfaction and shareholder value"

2.1.1 Vision of HDFC

1. To enhance residential housing stock in the country through the provision of housing

finance in a systematic and professional manner, and to promote home ownership.

2. To increase the flow of resources to the housing sector by integrating the housing

finance sector with the overall domestic financial markets.


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2.1.2 Mission of HDFC

a. Develop close relationships with individual households.

b. Maintain its position as the premier housing finance institution in

the country

c. Transform ideas into viable and creative solutions

d. Provide consistently high returns to shareholders

e. To grow through diversification by leveraging off the existing client

base.

HDFC HOLDINGS

HDFC

80.5%HDFCVentures

100%HDFCProperties

23.22%HDFCBank

74% HDFCStandard Life

60% HDFCAsset Mgt

23.27%HDFCBank


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Figure 1: Share Holding Pattern of HDFC


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Figure 2: Loans Approved & Disbursed by HDFC

2.4 STANDARD LIFE INSURANCE COMPANY


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Founded in 1825, Standard life has been at the forefront of the UK insurance industry for

176 years by combining sound financial judgment with integrity and reliability.

One of its successes was the launch of Standard Life Bank on 1st January, 1998. It is one

of the few insurance companies in the world to receive AAA rating from two of the

leading international credit rating agencies. Moodys and Standard & Poors. The later

described Standard Lifes ability to meet its claims obligations as overwhelming under a

variety of economic conditions.

2.5 THE PARTNERSHIP

HDFC and Standard Life first came together for a possible joint venture, to enter the life

insurance market, in January 1995. In October 1995 the companies signed a 3 year joint

venture agreement. Around this time Standard Life purchased a 5% stake in HDFC,

further strengthening the relationship.

In October 1998, the joint venture agreement was renewed and additional resource made

available. Standard Life also started to use the services of the HDFC Treasury department

to advise them upon their investments in India.

Towards the end of 1999, the opening of the market looked very promising and both

companies agreed the time was right to move the operation to the next level. Therefore,

in January 2000, an expert team from the UK joined a hand picked team from HDFC to

form the core project team, based in Mumbai.


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The company was incorporated on 14th August 2000 under the name of HDFC- Standard

Life Insurance Company Limited. On the 23rd of October 2000, HDFC-Standard Life was

the only life company to be granted a certificate of registration.

HDFC are the main shareholders in HDFC Standard Life Insurance , with 74%, while

Standard Life owns 26%.

Figure 3: Total AUM of HDFC


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\

Our Core Values

We lead through Innovation to offer world class and competitive products to our

customers We build Long Term Relationships with our customers by creating a world class

service experience through operational excellence and the innovative use oftechnology

We create a Customer Centered and Result Focused Vision that inspires each one

of our Associates and has their buy-in We are committed to creating a High Performance Organization by creating an

environment that allows each one of our Associates to perform at their peak. As aresult we will also be recognized as an Employer of Choice

We are committed to Partnering with our internal and external Customers for

mutual success We work with Integrity, Fairness and Financial Prudence in all our dealings

keeping the interests of our Shareholders, Customers and Associates paramount


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OBJECTIVE

Primary Objectives :

1. To study and learn about the various Insurance plans of hdfcslic .

2. To study about the various insurance companies and the products offered bythem.

3. To study the customers perception about the Insurance.

Secondary Objectives :

1.To find the different way of conviencing customers.2.To study the brand image of the company.3.To aquire new customers by conviencing them and to provide the benefit of those

which are provided by the company.

SCOPE OF STUDY

In todays emerging Indian economy the role and scope of Insurance companies

has increased manifold and hence this sector has seen tremendous growth and

competition over the years. Through my project I am trying to give an in depth

analysis on the same harping on the growth and emergence of new companies in


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the turf which was predominated by government backed companies. his study

relates to evaluate various insurance companies in terms of products, revenue,

sales, and human resources. It also covers emergence and growth of new

insurance companies in India. In this study I will go through the

products of various insurance companies and evaluate all the

products and compare those products with HDFCSLIC products

so that company can easily improve their productivity and boost

their sales. In this study a research will be conducted by using a structured

questionnaire to compare the products and market share of various insurance

companies. It also helps in knowing customers needs which is very beneficial for

company to increase productivity and boost sales. It is also helpful to understand

various marketing strategies adopted by various insurance companies so that

company can increase their market share by modifying marketing strategies and

can better serve the customers needs. I am also collecting information from the

company, websites, journals, magazines and unpublished data available atcompany to compare various insurance companies. I have also done a certification

of IRDA to get a financial advisor license. I have also gone through compliance

sales training (CST) so that I can get better knowledge of existing products of

HDFCSLIC and it is also helpful in comparing with other companies products. A

sample of 100 people will be taken to collect data by using structured and

unbiased questionnaire and probability sampling technique will be used to select

sample of 100 people from whole population and a random sample will be

selected

IRDA ACT 1999

Composition of Authority under IRDA Act, 1999


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As per the section 4 of IRDA Act' 1999, Insurance Regulatory and DevelopmentAuthority (IRDA, which was constituted by an act of parliament) specify the compositionof AuthorityThe Authority is a ten member team consisting of(a) a Chairman;

(b) five whole-time members;(c) four part-time members,

(all appointed by the Government of India)

Duties, Powers and Functions of IRDA

Section 14 of IRDA Act, 1999 lays down the duties, powers and functions ofIRDA..(1) Subject to the provisions of this Act and any other law for the time being inforce, the Authority shall have the duty to regulate, promote and ensure orderly growth ofthe insurance business and re-insurance business.

Without prejudice to the generality of the provisions contained in sub-section (1), thepowers and functions of the Authority shall include

(a) issue to the applicant a certificate of registration, renew, modify, withdraw, suspendor cancel such registration;

(b) protection of the interests of the policy holders in matters concerning assigning ofpolicy, nomination by policy holders, insurable interest, settlement of insurance claim,surrender value of policy and other terms and conditions of contracts of insurance;

(c) Specifying requisite qualifications, code of conduct and practical training forintermediary or insurance intermediaries and agents;

CAPITAL REQUIREMENT FOREIGN PARTICIPATION


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The government of India is planning to increase the equity limit for foreign directinvestment from the current 26 per cent to 49 per cent in the insurance sector.Liberalization of the FDI policy, including the Budget proposals for raising the sectoralcaps in insurance is one of the main factors for the higher FDI inflows during the currentyear. In 2003-04 the total FDI inflows in the country touched $3.4 billion. Indian

insurance companies have been pushing for the FDI limit to be raised. The current paid-up requirement of Rs 1 billion for general insurance and Rs 2 billion for life insurancehave become difficult targets to achieve for the companies. The companies feel thatinjection of additional foreign equity would reduce their costs. The sector was liberalizedfor private players towards the end of 1999. Currently, there are 14 insurance companies,including the key public sector company Life Insurance Corporation, in the life insurancesector and 13 general insurance companies.1. HDFC Standard Life Insurance Co. Ltd

2. Birla Sun Life Insurance Co. Ltd

3 Bajaj Allianz Life Insurance Company Limited

4. ICICI Prudential Life Insurance Co. Ltd.5. ING Vysya Life Insurance Company Ltd.

6. Life Insurance Corporation of India

7. Max New York Life Insurance Co. Ltd

8. Kotak Mahindra Old Mutual Life Insurance Limited

9.SBI Life Insurance Co. Ltd

10.Tata AIG Life Insurance Company Limited

11.Reliance Life Insurance Company Limited.

12.Aviva Life Insurance Co. India Pvt. Ltd.

13.Sahara India Life Insurance Co, Ltd.

14.Shriram Life Insurance Co, Ltd.

15.Bharti AXA Life Insurance Company Ltd.

16.Future General Life Insurance Company Ltd.

17.IDBI Fortis Life Insurance Company Ltd.

18.Canara HSBC Oriental Bank of Commerce Life Insurance Co. Ltd

19.AEGON Religare Life Insurance Company Limited.

20.DLF Pramerica Life Insurance Co. Ltd.

21.Star Union Dai-ichi Life Insurance Comp. Ltd.

22,Met life insurance co . Ltd

2.2 HDFC Board Of Directors

SNO NAME CATEGORY
http://en.wikipedia.org/w/index.php?title=HDFC_Standard_Life_Insurance_Co._Ltd&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Birla_Sun_Life_Insurance_Co._Ltd&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Bajaj_Allianz_Life_Insurance_Company_Limited&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=ICICI_Prudential_Life_Insurance_Co._Ltd.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=ING_Vysya_Life_Insurance_Company_Ltd.&action=edit&redlink=1http://en.wikipedia.org/wiki/Life_Insurance_Corporation_of_Indiahttp://en.wikipedia.org/w/index.php?title=Max_New_York_Life_Insurance_Co._Ltd&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Kotak_Mahindra_Old_Mutual_Life_Insurance_Limited&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=SBI_Life_Insurance_Co._Ltd&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Tata_AIG_Life_Insurance_Company_Limited&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Reliance_Life_Insurance_Company_Limited.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Aviva_Life_Insurance_Co._India_Pvt._Ltd.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Sahara_India_Life_Insurance_Co,_Ltd.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Shriram_Life_Insurance_Co,_Ltd.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Bharti_AXA_Life_Insurance_Company_Ltd.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Future_Generali_Life_Insurance_Company_Ltd.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=IDBI_Fortis_Life_Insurance_Company_Ltd.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Canara_HSBC_Oriental_Bank_of_Commerce_Life_Insurance_Co._Ltd&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=AEGON_Religare_Life_Insurance_Company_Limited.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=DLF_Pramerica_Life_Insurance_Co._Ltd.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Star_Union_Dai-ichi_Life_Insurance_Comp._Ltd.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Birla_Sun_Life_Insurance_Co._Ltd&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Bajaj_Allianz_Life_Insurance_Company_Limited&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=ICICI_Prudential_Life_Insurance_Co._Ltd.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=ING_Vysya_Life_Insurance_Company_Ltd.&action=edit&redlink=1http://en.wikipedia.org/wiki/Life_Insurance_Corporation_of_Indiahttp://en.wikipedia.org/w/index.php?title=Max_New_York_Life_Insurance_Co._Ltd&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Kotak_Mahindra_Old_Mutual_Life_Insurance_Limited&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=SBI_Life_Insurance_Co._Ltd&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Tata_AIG_Life_Insurance_Company_Limited&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Reliance_Life_Insurance_Company_Limited.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Aviva_Life_Insurance_Co._India_Pvt._Ltd.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Sahara_India_Life_Insurance_Co,_Ltd.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Shriram_Life_Insurance_Co,_Ltd.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Bharti_AXA_Life_Insurance_Company_Ltd.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Future_Generali_Life_Insurance_Company_Ltd.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=IDBI_Fortis_Life_Insurance_Company_Ltd.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Canara_HSBC_Oriental_Bank_of_Commerce_Life_Insurance_Co._Ltd&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=AEGON_Religare_Life_Insurance_Company_Limited.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=DLF_Pramerica_Life_Insurance_Co._Ltd.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Star_Union_Dai-ichi_Life_Insurance_Comp._Ltd.&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=HDFC_Standard_Life_Insurance_Co._Ltd&action=edit&redlink=1


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1 Mr. Deepak S. Parekh Executive Chairman

2 Mr. Keshub Mahindra Independent

3 Mr. Shirish B. Patel Independent

4 Mr. B. S. Mehta Independent

5 Mr. D. M. Sukthankar Independent6 Mr. D. N. Ghosh Independent

7 Dr. S. A. Dave Independent

8 Mr. S. Venkitaramanan Independent

9 Dr. Ram S. Tarneja Independent

10 Mr. N. M. Munjee Independent

11 Dr. Bimal JalanMember of Parliament

(Rajya Sabha)

12 Mr. D. M. Satwalekar Non-Executive13 Dr. Jamshed J Irani+ Special Director++

14 Ms. Renu Sud Karnad Joint Managing Director

15 Mr. K. M. MistryVice Chairman &

Managing DirectorTabl

MARKETING TEAM STRUCTURE
http://www.hdfc.com/others/directors_detail.asp#parekhhttp://www.hdfc.com/others/directors_detail.asp#mahindrahttp://www.hdfc.com/others/directors_detail.asp#patelhttp://www.hdfc.com/others/directors_detail.asp#mehtahttp://www.hdfc.com/others/directors_detail.asp#sukthankarhttp://www.hdfc.com/others/directors_detail.asp#ghoshhttp://www.hdfc.com/others/directors_detail.asp#davehttp://www.hdfc.com/others/directors_detail.asp#venkitaramananhttp://www.hdfc.com/others/directors_detail.asp#tarnejahttp://www.hdfc.com/others/directors_detail.asp#munjeehttp://www.hdfc.com/others/directors_detail.asp#jalanhttp://www.hdfc.com/others/directors_detail.asp#satwalekarhttp://www.hdfc.com/others/directors_detail.asp#karnadhttp://www.hdfc.com/others/directors_detail.asp#mistryhttp://www.hdfc.com/others/directors_detail.asp#parekhhttp://www.hdfc.com/others/directors_detail.asp#mahindrahttp://www.hdfc.com/others/directors_detail.asp#patelhttp://www.hdfc.com/others/directors_detail.asp#mehtahttp://www.hdfc.com/others/directors_detail.asp#sukthankarhttp://www.hdfc.com/others/directors_detail.asp#ghoshhttp://www.hdfc.com/others/directors_detail.asp#davehttp://www.hdfc.com/others/directors_detail.asp#venkitaramananhttp://www.hdfc.com/others/directors_detail.asp#tarnejahttp://www.hdfc.com/others/directors_detail.asp#munjeehttp://www.hdfc.com/others/directors_detail.asp#jalanhttp://www.hdfc.com/others/directors_detail.asp#satwalekarhttp://www.hdfc.com/others/directors_detail.asp#karnadhttp://www.hdfc.com/others/directors_detail.asp#mistry


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KEY BENEFITS OF LIFE INSURANCE


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Need for Life InsuranceToday, there is no shortage of investment options for a person to choose from. Modern dayinvestments include gold, property, fixed income instruments, mutual funds and of course,life insurance. Given the plethora of choices, it becomes imperative to make the right choicewhen investing your hard-earned money. Life insurance is a unique investment that helps you

to meet your dual needs - saving for life's important goals, and protecting your assets.Let us look at these unique benefits of life insurance in detail.

Asset Protection

From an investor's point of view, an investment can play two roles - asset appreciation orasset protection. While most financial instruments have the underlying benefit of assetappreciation, life insurance is unique in that it gives the customer the reassurance of assetprotection, along with a strong element of asset appreciation.

The core benefit of life insurance is that the financial interests of ones family remainprotected from circumstances such as loss of income due to critical illness or death of thepolicyholder. Simultaneously, insurance products also have a strong inbuilt wealth creationproposition. The customer therefore benefits on two counts and life insurance occupies aunique space in the landscape of investment options available to a customer.

Goal based savings

Each of us has some goals in life for which we need to save. For a young, newly marriedcouple, it could be buying a house. Once, they decide to start a family, the goal changes toplanning for the education or marriage of their children. As one grows older, planning for

one's retirement will begin to take precedence.

Clearly, as your life stage and therefore your financial goals change, the instrument in whichyou invest should offer corresponding benefits pertinent to the new life stage.Life insurance is the only investment option that offers specific products tailormade fordifferent life stages. It thus ensures that the benefits offered to the customer reflect the needsof the customer at that particular life stage, and hence ensures that the financial goals of thatlife stage are met.

The table below gives a general guide to the plans that are appropriate for different lifestages.


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Life Stage Primary NeedLife Insurance

Product

Young &Single

Asset creationWealth creationplans

Young & Justmarried

Asset creation &protection

Wealth creationand mortgageprotection plans

Married withkids

Children'seducation, Assetcreation andprotection

Educationinsurance,mortgageprotection & wealthcreation plans

Middle agedwith grown

up kids

Planning forretirement &

asset protection

Retirementsolutions &mortgage

protection

Across alllife-stages

Health plans Health Insurance

Life Stage Profiler

All through your life, several significant events the birth of your child, moving to a larger

home, his or her education and wedding, buying a new car, retiring from work will occur atvarious stages and demand your financial commitment. If you plan in advance for theseevents, you will quite naturally be prepared when they occur.Life insurance is an effective tool that assists you to plan for your future such that you arefinancially equipped to meet all your goals.

Which important goals should you plan for in advance?

1) Your family's protection - so that your loved ones are secure should an unfortunate


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event happen to you. Life insurance can guarantee that your family receives a lumpsum thatsafely tides them over any financial crises that might occur in your absence.

2) Child's education: As parent, your primary responsibility is to guarantee yourchildren's future. Our Education Insurance plans ensure your child receives money at key

stages of his or her education even in your absence.

3) Savings: Savings plans allow you to steadily save towards a pre-decided goal in a securemanner. These plans provide you with a host of benefits. You can choose the premium, theunderlying fund in which you want to invest your money, the ratio between protection andinvestment as per your requirements.

4) Retirement: Retirement plans help you secure guaranteed income for your retired life.During the Accumulation phase, you systematically save while you are working. When youretire, the Payout stage of the plan begins. You then purchase an annuity, which will serve asa steady stream of income, for the rest of your life.

5) Health: An integral part for financial planning is protecting oneself against any medicalemergencies as well. Hence, a very prudent decision would be to choose a combination ofplans that look after your finances and offer you a protective health cover to ensure yourfinancial planning is in track despite any major illnesses.

PRODUCTS & SERVICES


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The right investment strategies won't just help plan for a more comfortable

tomorrow -- they will help you get Sar Utha ke Jiyo. At HDFC SLIC, life

insurance plans are created keeping in mind the changing needs of family. Its

life insurance plans are designed to provide you with flexible options that

meet both protection and savings needs. It offers a full range of transparent,

flexible and value for money products. HDFC SLIC products are modern and

contemporary unitized products that offer unique customer benefits like

flexibility to choose cover levels, indexation and partial withdrawals. (Source:

www.hdfcslic.com)

Products of the company

1. Protection plans:

A person can protect his family against the loss of his income

or the burden of a loan in the event of his unfortunate

demise, disability or sickness. These plans offer valuable

peace of mind at a small price. Protection range includes ourTerm Assurance Plan & Loan Cover Term Assurance

Plan.

Plan Overview

HDFC OFFERS -the hdfc Term Assurance plan (TAP)', a non

participating term assurance plan which provides you life cover at anominal cost. To put it simply, it is a life insurance plan that gives

you complete protection to enjoy life to the fullest. You can further

customize your plan with two riders Accidental Death Benefit

and Critical Illness.

Plan at a glance
http://www.hdfcinsurance.com/products/indi_tap.aspxhttp://www.hdfcinsurance.com/products/indi_lcta.aspxhttp://www.hdfcinsurance.com/products/indi_lcta.aspxhttp://www.hdfcinsurance.com/products/indi_tap.aspxhttp://www.hdfcinsurance.com/products/indi_lcta.aspxhttp://www.hdfcinsurance.com/products/indi_lcta.aspx


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Minimum Entry Age 18 years

Maximum Entry Age 60 years

Maximum Maturity Age 65 years

Minimum Sum Assured Rs. 50,000

Maximum Sum Assured No LimitPolicy Term 5, 10, 15, 20, 25 years and Term to age

60

Premium Paying Terms Single Pay, Limited Pay (3 years),Regular Pay

RidersAccidental Death Benefit RiderCritical Illness Rider

Products Benefits

Riders

2.Retirement Plans:

Retirement Plans provide you with financial security so that

when your professional income starts to ebb, you can still live withpride without compromising on your living standards. By providing youa tool to accumulate and invest your savings, these plans give you alump sum on retirement, which is then used to get regular incomethrough an annuity plan. Given the high cost of living and risinginflation, employer pensions alone are not sufficient. Pension planninghas therefore
http://showdetail1%28%27metliferider_accident_death_benefit.aspx%27%29/http://showdetail1%28%27metliferider_critical_illness.aspx%27%29/http://showdetail1%28%27metliferider_accident_death_benefit.aspx%27%29/http://showdetail1%28%27metliferider_critical_illness.aspx%27%29/


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Retirement plans

HDFC Personal Pension Plan

HDFC Unit Linked Pension II

HDFC Unit Linked Pension Maximiser II

HDFC Immediate Annuity

.

Plan at a glance

Entry Age (in completed years) Min 20 yearsMax 55 years

Minimum Term 10 years

Minimum Vesting Age 45 years

Maximum Vesting Age 65 years

Minimum Premiums Single Pay: Rs. 1,00,000Regular Premium: Rs. 10,000

Premium Paying Term Single Pay & Regular Pay

Products BenefitsRidersNot Available

Death Benefit

In case of death during the accumulation period, the death benefitpayable is:Under Option A: A guaranteed amount of 110% of the Fund Valueis payable to the nominee.Under Option B: 100% of the Fund Value is payable to thenominee.

Vesting BenefitOn the vesting date, i.e. at the end of the accumulation term,youcan take one-third of your retirement kitty as a tax-free lump sumand utilize the balance to buy annuities. Or you can use the entire

retirement kitty to buy annuities.

Annuity OptionsYou can choose from a wide variety of eight immediate annuityoptions at the time of retirement to match your pensionrequirement.

Reasons to buy
http://www.hdfcinsurance.com/Products/PensionPlans/Pension.aspxhttp://www.hdfcinsurance.com/Products/PensionPlans/Pension2.aspxhttp://www.hdfcinsurance.com/Products/PensionPlans/PensionMaximiser.aspxhttp://www.hdfcinsurance.com/Products/PensionPlans/Annuity.aspxhttp://www.hdfcinsurance.com/Products/PensionPlans/Pension.aspxhttp://www.hdfcinsurance.com/Products/PensionPlans/Pension2.aspxhttp://www.hdfcinsurance.com/Products/PensionPlans/PensionMaximiser.aspxhttp://www.hdfcinsurance.com/Products/PensionPlans/Annuity.aspx


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Savings & Investment Plans

HDFC Unit Linked Endowment Plus II

HDFC SimpliLife

HDFC Unit Linked Endowment II

HDFC Unit Linked Enhanced Life Protection II

HDFC Unit Linked Wealth Maximiser Plus

HDFC Unit Linked Wealth Multiplier

HDFC Unit Linked Endowment Winner

HDFC Endowment Assurance Plan

HDFC Money Back Plan

HDFC Single Premium Whole of Life Insurance Plan

HDFC Assurance Plan

HDFC Savings Assurance Plan

HDFC Unit Linked Endowment Plus II

With our HDFC Unit Linked Endowment Plus II, you can start building your savings today

and ensure that your family remains financially independent, even when you are not around.

This Unit Linked plan provides valuable protection to your family in case you are not around

and gives you with an outstanding investment opportunity to maximise your savings by

providing you a choice of thoroughly researched and selected investments. This plan also

gives regularLoyalty Units to boost your fund value each year..

HDFC SimpliLife

With our HDFC SimpliLife Plan, you can plan now to maximise your savings and secure your

and your familys future. It is a convenient plan, which saves you from the need of going for

Medicals. This Unit Linked Plan gives you with an outstanding investment opportunity to

maximise your savings by providing you a choice of thoroughly researched and selected

investments.


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HDFC Unit Linked Endowment I

With our HDFC Unit Linked Endowment II, you can start building your savings todayand ensure that your family remains financially independent, even when youare not around. This Unit Linked Plan also gives you with an outstandinginvestment opportunity to maximise your savings by providing you a choiceof thoroughly researched and selected investments.

HDFC Unit Linked Enhanced Life Protection II

With our HDFC Unit Linked Enhanced Life Protection II, you can start building yoursavings today and ensure that your family remains financially independent,even when you are not around. This Unit Linked Plan also gives you with anoutstanding investment opportunity to maximise your savings by providingyou a choice of thoroughly researched and selected investments. In this plan,the original Sum Assured chosen by you will be automatically increased by5% each year giving your family benefit of enhanced protection.

HDFC Unit Linked Wealth Maximiser Plus

Ideally, just how spending comes to you, so must saving and investing. You are able tofinance your expenses and take care of your familys needs in present times.However, to ensure that family is able to maintain the same standard of living inthe future, you need to make the right kind of investment today. HDFC Unit LinkedWealth Maximiser Plus, a uniqueSingle Premium investment cum protection planis a tailor made plan well suited to meet your long-term investment needs andhelp you maintain your familys financial independence. This plan also givesregular Loyalty Units to boost your fund value each year.

HDFC Money Back PlanWith our HDFC Money Back Plan, you can plan now to ensure that you have the

necessary funds to have the necessary funds to secure your long-term as well as

short-term financial goals. This With Profits plan gives you a proportion of the

basis Sum Assured as Cash lump sums at regular 5-year intervals within the

policy term.

Plan Overview

Hdfc money back plan - a guaranteed money back plan that paysout funds to help you meet the education and career milestones ofyour children. With this plan, the Life Insured is that of the parent.The plan also has inbuilt guaranteed additions to add value to thepolicy over its term.

There are two options to choose from and fixed term benefits,periodic additions & terminal additions are payable based on the


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option that you select. The policy is suitable for parents withchildren between the ages 0-12 and parents in the age group of 20-50 years old.

Plan at a glance

Coverage Term

Option A Option B

Minimum Entry Age of theChild

0 years 0 years

Maximum Entry Age of theChild

8 years 12 years

Minimum Entry Age of theparent

20 years 20 years

Maximum Entry Age of theParent

50 years 50 years

Policy Term 21 years - Age atEntry

25 years - Age atEntry

Minimum Sum Assured Rs 1,00,000 Rs 1,00,000

Maximum Sum Assured No Limit No Limit

RidersAccidental Death Benefit Rider

Critical Illness RiderWaiver of Premium RiderTerm Rider

Products Benefits

Death BenefitIn the event of death of the Person Insured (the parent), the familywill receive a lump sum payment of Sum Assured. The fixed termpayment and maturity benefits will continue irrespective of thedeath of the Life Insured and all future premiums on the policy

would be waived.

Maturity BenefitOn maturity of the policy, the plan offers Guaranteed PeriodicAdditions and Terminal Additions:1. Guaranteed Periodic Additions of 5% of the Sum Assured forevery completed year.


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2. Terminal additions of 20% of the total Guaranteed PeriodicAdditions.

Guaranteed Payouts

Option A: Policy matures at age 21 of the child.

Age of the Child Percentage of Payout Assumed Milestone

15 years 20% of Sum Assured Class X

17 years 30% of Sum Assured Class XII

20 years 50% of Sum Assured College

21 years Guaranteed Additions Higher Education

Option B: Policy matures at age 25 of the child.

Age of the Child Percentage of Payout Assumed Milestone17 years 20% of Sum Assured Class XII

21 years 30% of Sum Assured College

23 years 50% of Sum Assured Higher Education

25 years Guaranteed Additions Wedding

Reasons to buy

1. Guaranteed payouts at critical milestones of the childs life.

2. Guarantee of policy continuance in case of the untimely demiseof parent.

3. Guaranteed payouts of 250%* of the chosen Sum Assured.

4. Income Tax benefits.

* When the term of the plan is 25 years.
http://showdetail1%28%27metliferider_accident_death_benefit.aspx%27%29/http://showdetail1%28%27metliferider_waiver_premium.aspx%27%29/http://showdetail1%28%27metliferider_accident_death_benefit.aspx%27%29/http://showdetail1%28%27metliferider_critical_illness.aspx%27%29/http://showdetail1%28%27metliferider_waiver_premium.aspx%27%29/http://showdetail1%28%27metliferider_term_rider.aspx%27%29/


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4.Children Plan:

Childrens Plans helps you save so that you can fulfill your childs dreams and

aspirations. These plans go a long way in securing your childs future by

financing the key milestones in their lives even if you are no longer around to

oversee them. As a parent, you wish to provide your child with the very best that

life offers, the best possible education, marriage and life style.

Children's Plans

HDFC Children's Plan

HDFC Unit Linked Young Star II

HDFC Unit Linked Young Star Plus II

HDFC Unit Linked YoungStar Champion

Health Plans

Health plans give you the financial security to meet health related contingencies.

Due to changing lifestyles, health issues have acquired completely new

dimension overtime, becoming more complex in nature. It becomes imperative

then to have a health plan in place, which will ensure that no matter how critical

your illness is, it does not impact your financial independence

Health Plans

HDFC Critical Care Plan

HDFC SurgiCare Plan

Marketing strategy of all the companies is different besides the lot of

similarity in the products.


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If we see the data then we will find that HDFC STANDARD LIFE Insurance hasnumber of branches according to the latest data in annual report of 2007-2008 by IRDA,hdfcslic has730 branches, but the premium that they offer to Insurance Industry is 1410cores, and the number of life advisors are much if we compare it to other companies sofrom where does this Premium is amounting this much, it shows that HDFC

STANDARD Life focuses on big business houses, i.e. they are much desperate for theirbusiness with elephant then humming birds.If we see the things in a different fashion then we will find that the

HDFCSTANDARDLife is having the shield of Guaranteed Maturity Value. No doubt thecompany is having a long list of the product with them. Variety is there as in the range ofthe product varies from Child product to retirement solutions, but their focus is in ULIPPLANS was a huge success.

Market Share of all Insurance Companies in India:

Market share of Private Players in India:
http://www.hdfcinsurance.com/Products/HealthPlans/CriticalCare.aspxhttp://www.hdfcinsurance.com/Products/HealthPlans/SurgiCare.aspx


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COMPARISON OF PREMIUM OF MONEY BACK POLICIES

AGE 30

YEARS

POLICY TERM 20 YEARS AGE 30 YEARS POLICY TERM 15 YEARS

PREMIUM PREMIUM

COMPANY SUM

ASSURED:1

LAC

SUM

ASSURED:

2 LACS

COMPANY SUM

ASSURED:1

LAC

SUM

ASSURED:2

LACS

LIC 6280 12559 LIC 7953 15906

ICICI PRU 6592 12884 ICICI PRU 9094 17888

ALLIANZ

BAJAJ

6158 11836 ALLIANZBAJAJ

8362 16244

TATA AIG 9099 17698 TATA AIG NA NA

HDFC 7585 15020 HDFC 9102 18054

OM KOTAK 7120 14240 OM KOTAK 8890 16480

MAX

NEWYORK

NA NA MAX

NEWYORK

NA NA

MET LIFE 5856 11412 MET LIFE 7572 14844


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AGE 35

YEARS

POLICY TERM 20 YEARS AGE 35 YEARS POLICY TERM 15 YEARS

PREMIUM PREMIUM

COMPANY SUM

ASSURED:1

LACS

SUM

ASSURED:

2 LACS

COMPANY SUM

ASSURED:1

LACS

SUM

ASSURED:2

LACS

LIC 6464 12928 LIC 8089 16177

ICICI PRU 6683 13067 ICICI PRU 9160 18019

ALLIANZ

BAJAJ

6252 12024 ALLIANZBAJAJ

8432 16384

TATA AIG 9219 17938 TATA AIG NA NA

HDFC 7719 15270 HDFC 9184 18218

OM KOTAK 7330 14660 OM KOTAK 9010 16700

MAXNEWYORK

NA NA MAXNEWYORK

NA NA

MET LIFE 6000 11700 MET LIFE 7668 15036


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AN ANALYSIS ON

GUARANTEES ON INSURANCE AND PENSION

PRODUCTS

AS ON MARCH 2008

IRRS/GURANTEES

COMPANY INSURANCE PENSION

ALLIANZ BAJAJ 2.14% NA

AVIVA -1.80% NA

AMP SANMAR NA NA

BIRLA SUNLIFE 0.70-1.50% 1-1.5%

HDFC STANDARD 0.73% 1.7-1.9%

ICICI PRUDENTIAL 1.70-4.95% 3.06%

ING VYSYA 0.70% NA

LIC 4-6% 1.3-2%

MAX NEWYORK LIFE 3.05% 1.4-1.9%

MET LIFE 5.5-5.7% 2.3-2.7%

OM KOTAK -0.04% 2.10%

SBI LIFE 0.73%-4.7% 4%

TATA AIG -2-4.4% 1.30%


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Michael Porters Model

The model originated from Michael.E.Porters book Competitive strategy:Techniquesfor analyzing Industries and competitors in 1980. Since then, it has become a frequentlyused tool for analyzing a companys industry structure and their corporate strategy.

In his book, porter identified five competitive forces that shape every single industry andmarket. These forces help us to analyze everything from the intensity of competition tothe profitability and attractiveness of an industry. The following image shows therelationship between the different competitive forces.

Threats of new entrants-High

It is easier for new companies to enter into the industry and there will be more cut throatcompetition. Factors that can limit the threat of new entrants are known as barriers toentry.

So in an insurance industry the average entrepreneur cant come along andstart a new large insurance company. The threat of new entrants lies within the insuranceindustry itself. Some companies have carved out niche areas in which they underwriteinsurance. So HDFC is fearful of being squeezed out b the big players. Another threat forit is other financial services companies entering into the market. What would it take for a


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bank or investment bank to start offering insurance products? In some countries, onlyregulations that prevent banks and other financial firms from entering the industry. Ifthose barriers were ever broken down, like they were in the U.S with the Gramm-Leach-Bliley Act of 1999.

Power Of Suppliers-lowThis is how much pressure suppliers can place on a business. If one supplier has a largeenough impact to affect a companys margins and volumes, then they hold substantialpower.

So in insurance industry, the suppliers of capital might not pose a bigthreat, but the threat of suppliers luring away human capital does. If a talented insuranceunderwriter is working for HDFCSLIC Insurance company(or one in a niche industry),there is a chance that person will be enticed away by larger companies looking to moveinto a particular market.

Power of Buyers-low

This is how much pressure customers can place on a business. If one customer has a largeenough impact to affect a companys margins and volumes, then they hold substantialpower.

So for Metlife, the individual doesnt pose much of threat to the company.Large corporate clients have a lot more bargaining power with insurance companies.Large corporate clients like airlines and pharmaceutical companies pay millions ofdollars in premium annually. Insurance companies try extremely hard to get high margincorporate clients.

Availability of Substitutes-HighWhat is the likelihood that someone will switch to a competitive product or service? Ifthe cost of switching is low, then this poses to be a serious threat.

This one is pretty straight forward, for there are plenty of substitutes in theinsurance industry. Most large insurance companies offer similar suites of services.Whether it is auto, home, commercial, health or life insurance. In some areas ofinsurance, however, the availability of substitutes are far and few between. Metlifefocusing on niche areas usually have a competitive advantage, but this advantage dependsentirely on the size of the niche and on whether or not there are any barriers preventingother firms from entering.


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Competitive Rivalry-HighAnd last but not the least, this describes the intensity of competition between existingfirms in an industry. Highly competitive industries generally earn low returns because thecost of competition is high.

The insurance industry is becoming highly competitive. The differencebetween one insurance company and another is usually not that great. As a resultinsurance has become more like a commodity, an area in which the insurance companywith the low cost structure, great efficiency and better customer service will beat outcompetitors. HDFCSLIC also use higher investment returns and a variety of insuranceinvestment products to try to lure in customers. In the long run, were likely to see moreconsolidation in the insurance industry. Larger companies prefer to takeover or mergewith another rather than spend the money to market and advertise the people.


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S.W.O.T ANALYSIS OF METLIFE INDIA INSURANCE

STRENGTHS

Brand Image , Business Experience and Innovative products. .

Large number of young workforce .The 40K agents which are very selectively

chosen .

Service quality which is the crux of their mission.

Has tie up with banks like HDFC BANK.

Paidup capital ofRS 1900 cr as on 2008 which shows company dependability.

Very less charges on ULIP plans as compare to other insurance players .

1153.6 cr AFYP on 2008.

WEAKNESS

Many competitors in the market ofsame products by the title and difference inpremium and offerings.

Sustainable to riskassociated with investments in money market.

Very less network branches due to which its difficult for customer to make

payment easily.

Not focusing on consumer awareness mainly concentrating on personal

selling .

More focusing in urban areas not touching rural area which has a very goodpotential market for insurance sector.

Lacking in advertistment due to which they are not able to cover a large area

or large no of customer.


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OPPORTUNITY

Huge market is literally untapped.out of estimated 320 millions insurable

markets only 20% of the population is insured.

Health insurance and pension schemes, an estimated marketpotential of

approximately $ 15 billion.

Nearly 70% of the Indian population is without Life , Health , and Non-Life

insurance.

Per Capita life insurance premium in India in 2004 was $16 as compared to the

world average of $ 292.

Strong economic growth with increase in affluence and rising risk awareness

leading to rapid growth in the Insurance sector.

THREATS

Players like ICICI and birla sunlife offersame plans with low premiums.


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Entry of many other private companies with equally strongexperience and

financial strength of foreign partners making the competition difficult and

saturating the urban markets (example ; idbi fortis insurance , bharti axa insurance

and more.)

Current govt. policies do not encourage gross domestic savings. if the tax

liability of the sevice class rises, the customer will have little money to invest.

Lic has woken up from sleep and is following competitive strategies. its huge

surplus in life fund gives a capability to lodge price war.

RESEARCH METHODOLOGY

5.1 DESCRIPTIVE RESEARCH DESIGN

The research design adopted in this study is DESCRIPTIVE RESEARCH DESIGN. Adescriptive research design is the one which is description of the state of affairs as itexists at present. It includes survey and fact finding enquiries of different kinds. Theresearcher has no control over the variables. The researcher used this research design tofind out the respondents attitude and opinion about products offered.

5.2 SAMPLING DESIGN

A sample design is a definite plan for obtaining a sample from a given population. Itrefers to the techniques or procedures the researcher would adopt in selecting items forthe sample.


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SAMPLING

The researcher adopted convenience sampling. It is the non probability sampling is thatsampling procedures does not any basis for estimating the probability that each item in

the population has of included in the sample. The researcher selects the people accordingto their convenient.

SAMPLE SIZE

A sample of 150 people will be taken for the survey. The required data collected throughquestionnaire.

5.3 SAMPLING AREA

The sampling unit may be a Geographical one such as state, District, Village etc., The

geographical sampling unit under study has covered the area of chandigarh .

DATA COLLECTION

The information required for our project was collect mainly from the primary sources and

even from secondary sources. The primary source consists of the data analyzed from

questionnaire and interaction with the user at that time only. And internet is used as

secondary source.

5.4 DATA COLLECTION METHOD

Data is collected through questionnaire schedule method.


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5.5 CONTACT METHOD

Face to Face

Analysis and Interpretation

Q1. How important it is to take a insurance policy? a. Very Important

b. Important

c. Not Important

d. Dont Know


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INTERPRETATION48 % of the total respondents suryed think that Life Insurance policy is important forthem and 28.8% respondent think that it is very important and only 16% think that Lifeinsurance is not impotant for them.

Q2. Sources which helps you in making the investment decisions: a. Financial journal / business magazines11

b. Reference groups 21

c. Television 45

d. General / business newspapers 16

e. Brokers / agents / professional consultant 23

f. Word of mouth/ influencer 34


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INTERPRETATIONTelevision is major source which helps in making the investment decision its theperception of 30% respondent suryed and 22% respondent make there decision on wordof mouth and only 7% respondents takes the help of Finacial Journals/businessmagazines.

Q3. What is the purpose of taking an insurance policy? a. Investment b. Tax Saving

c. Old Age Saving

d. For Your Family Needs

e. For Certain Mishappening

f. Security


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INTERPRETATION28% respondents think that Investment is the main purpose for taking an insurance policyand only 14% respondent think that there purpose of insurance policy is for CertainMishappening which is ultimately the main purpose of the Insurance.

Q4. According to you which among the following Life insurance companieswould you like?

LIFE INSURANCE CORPORATION AVIVA LIFE INSURANCE

ICICI PRUDENTIAL

HDFCSLIC

BIRLA SUN LIFE

OTHERS


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INTERPRETATION40% of the respondent surveyed perception is that LIC is best among all the Insuranceplayers and 14% respondent think that HDFCSLIC is the best among other insuranceplayers .

Q5. Are you aware of the allocation charges of different insurancecompanies? a. Yes

b. No


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INTERPRETATION70% of the total respondents surveyed dont aware of different charges charged byInsurance companies and only 29% respondent surveyed aware about different charges .

Q6. Factors that influence your investment decisions in a particularcompany:

Ranking

Response

1 2 3 4 5 6 7 8

Brand 39 29 29 17 14 9 8 5


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Promotion 28 27 31 19 16 12 9 8Relation withAgent

22 31 26 21 19 15 7 9

Rate of Return 16 15 21 24 27 19 20 8Life InsuranceCover

13 11 15 23 25 21 24 18

Tax Benefits 9 13 14 22 18 23 25 26BetterServices

15 15 8 13 15 25 29 30

AllocationCharges

8 9 6 11 16 26 28 46

INTERPRETATION26% of total people surveyed have ranked Brand as #1 for influence them for taking aninvestment decision and 18% respondent ranked Promotions # 1 for there investmentdecision and 14% people ranked relation with agent as #1 for there decision and 31%

respondent ranked Allocation charges as #8 for there investment decisions .

Q7. Which Companys Insurance do you have? LIC

ICICI Prudential

Bajaj Allianz


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HDFC

Birla Sun Life

Others Pls Specify..

INTERPRETATION49% of total respondent surveyed have LICs Insurance Policy, 18% have ICICIPrudential & only 5% respondents have Insurance policy of companies like Metlife,

Bharti AXA, IDBI Fortis etc.

Q8. Are you satisfied with the return, which you are getting from yourcurrent policies? a. Very Satisfied


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b. Satisfied

c. Not Much Satisfied

d. Dissatisfied

INTERPRETATION38% respondent surveyed are satisfied with the return they are getting from their currentpolicies and only 46% respondent are not much satisfied & dissatisfied from the returnthey are getting from their current policies.


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Q9. Which type of fund will you prefer for investment ? a. Whole Life Policy (5 to 6 % low risk)

b. Endowment (9% moderate)

c. ULIP (>15% high risk)

d. Equity (very high risk)

INTERPRETATION34% of the respondent surveyed are willing to invest in ULIP plans which has high riskand 31% people surveyed are willing in Equity which has very high risk and only 12%respondent surveyed willing to investment in whole life policy because of low rate ofreturn.

Q10. Where do you generally like to invest your money?

Rating response

1 2 3 4 5


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Insurance 35 38 36 27 14

Stock Market 49 35 31 29 6

Mutual fund 32 29 32 31 26

Bank / Fixed Deposits / PostOffice savings

24 27 29 32 38

Others (Real estate, Gold etc.) 10 21 22 31 66

INTERPRETATION32% of the respondent surveyed are like to invest there money in stock market , 23% ofrespondent are like to invest in insurance and 21% people surveyed like to invest inMutual fund it shows that insurance has tough competition from other other investmentinstruments like stock and mutual funds.

Q11. What attracts you more to buy insurance? a. Lower Premium Allocation Charges

b. Guaranteed Return


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c. Return Depend on Market

d. Any other ( please specify).

INTERPRETATION33% of respondent surveyed thinks that Return depend on market condition attracts themmore to buy an insurance policy (example- ULIPS) and 27% respondent think thatguaranted return on an insurance policy attracts them more to buy an insurance policyand only 19% respondents have a perception that low allocation charges attracts them forbuying an insurance policy.

Q12. Which factor will you give preference while buying an insurancepolicy? a. Brand


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b. Policy Scheme

c. Relationship (agent)

d. Service

INTERPRETATION35% respondent surveyed give preference to Brand image for buying an insurance policyand only 13% respondent surveyed give preference to the Service provided by thecompany for buying an insurance policy.

Q13. Which mode would you prefer to pay premium?


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a. Single Premium

b. Annually

c. Half Yearly

d. Monthly

INTERPRETATION51% of the respondent surveyed willing to choose the annually premium pay andonly17% respondent choose monthly mode for paying a premium.

RECOMMENDATIONS


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The Metlife India Insurnce company should now try to identify the gap between currentlevel of customer service and customer expectations. Some of the strategies beingrecommended are as follows:

Brand Building: MetLife is a very huge Brand in US in Insurance but in India itis not known as a Insurance brand. So MetLife need to focus on Brand building

Activities which can be done through Advertising, Road shows, Knops,

Sponsoring Events in rural & Urban Areas.

Educating the Consumers: As per the survey Conducted it is found that most of

the respondents dont know the core function of the insurance & they are taking

it only as an investment instrument & also they are not aware of the nitty-gritties

like different allocation charges. So MetLife should take initiative to educate theconsumers regarding all these aspects & take competitive Advantage on this

front as its Allocation charges are minimum in the whole Indian Insurance

Industry.

Need to Increase Market Presence: As per the survey conducted it is found that

metlife have only 3% market share, it is because its presence in market is very

less. It should make more channel partners & do business tie ups with more

broking houses & should hire marketing agencies for aggressive marketing

purpose. It can also increase its Business Units.

Concentration More On Rural Areas : Metlife need to concentrate moretowards the rural areas as 60-70% of India population is living in rural areas andmost of the people in rural areas are not insured so there is a huge potential in therural sector.

Product Differentiation: Offering a product that is distinctly different fromother products available in the market by other insurance players.

More Guaranteed Plans to be Introduced: As we know today the stockmarket is giving very less return even in last year the return comes Negative sothe company need to introduce some more gurranted plans so that customer caninvest in them and have assured return on them which ultimately is an edge incompetition in insurance sector.


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Need to commence Medical claim Products and General Insurance :

There are very less which are having Medical claim products and also very lesscompanies providing General Insurance with Life Insurance for example ICICI ,

Reliance and Bajaj Allianz so Metlife also need to come in General Insurancebusiness so that they can compete with these players.

Flexibility: The companies should make their products flexible for theconvenience of their customer.

Hassle Free Service: All bureaucracy in customer interactions should beeliminated.

Proper Policy Documentation: Wrong interpretations/ non-awareness of policydocument by the customer may have serious implications in the long term andthe possibility of the same should be alleviated by the company which leads to.


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LIMITATIONS

1. Difference in the opinion of the customers and the company..

2. Company is not willing to disclose full information.

3. Biased behavior of the respondents.

4. Sample size being small, may not reflect the opinion of major segment.

5. Time frame is limited.

6. Difficulty in analyzing the data because of multiple responses given by the

respondents.


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CONCLUSION

The various conclusions drawn from the project are: -

There has been tremendous change in the insurance history. And with it there has been

continuous growth in this sector both in Indian as well as world context.The opening up of the insurance sector has changed the whole look of the industry. While

the LIC in order to face the competition is coming with new strategies. New players like

Metlife , ICICI , Birla Sunlife are leading the sector due to their strategic management

and tailored made projects.

From our research also we conclude that though the awareness and people opting for LIC

plans are more as compare to Metlife but the later are gaining momentum in the market

day by day.

The primary reasons for buying an insurance policy, whether life or non-life is to protect

us from vagaries of life. We do not invest in insurance for returns; rather we invest in it

for regrettable necessities. Though a large proportion of policies available in the country

provide for returns, but nobody is looking for returns to the inflation rate. So what does

insurance offer, perhaps peace of mind, but even that takes time, due to poor claim

performance

The demand for insurance is likely to increase with rising per-capita incomes, rising

literacy rates and increase of the service sector, as has been seen from the example of

several other developing countries. In fact, opening up of the insurance sector is an

integral part of the liberalization process being pursued by many developing countries

Insurance is a Rs.400 billion business in India and yet its spread in the country is

relatively thin. Insurance as a concept has not been able to make headway in India. There

has been a strong fall in insurance business in recent years. Furthermore, it can be

observed that non-life business is not increasing as strongly as life business. On the other

hand, growth fluctuations have been relatively small with growth rates varying between

1% and 5%. Life insurance business by contrast achieved average growth rates of 6%,

although the actual rates ranged from 0% to 13%. This shows on the one hand the

increasing significance of life insurance as an instrument for old age provisions and on

the other hand indicates the sensitivity of life insurance to changes in the institutional

and economic environment.


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BibliographyBooks :

1.Law and Practice of Banking, S.S.Gulshan,Conark Publisher Delhi,ThirdEdition

2.Security Analysis and Portfolio Management, Punithavathy Pandian,Himalya PublisherHouse Co.,Revised Tenth Edition

3.Banking Law and Practices in India, Dovel.S.R,Tornto PublicationHouse,Kolkata.Eleventh Edition

4.Principles of Banking and Insurance, P.N.Vashan ,Foruth Edition5. Risk and Risk Insurance, Kwon and W.Jean,New Publishers New Delhi,Second

Edition

Journals and Magazines :

1) IRDA Annual Report, 2007-08

2) Principles of Life Assurance, IC-23 ,1988-2005

3) Business Research Method by ICFAI Center for Management and Research,2007

4) Business Research Method by Donald R. Cooper and Pamela S. Shchindler,2005

Websites:

www.hdfcslic.co.in www.irdaindia.org www.insuranceworld.com www.findarticles.com


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http://www.hdfcslic.co.in/http://www.irdaindia.org/http://www.insuranceworld.com/http://www.findarticles.com/


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ANNEXURE


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QUESTIONNAIRE

Q1. How important it is to take a insurance policy?

a. Very Important

b. Important

c. Not Important

d. Dont Know

Q2. Sources which helps you in making the investment decisions:

a. Financial journal / business magazines11

b. Reference groups 21

c. Television 45

d. General / business newspapers 16

e. Brokers / agents / professional consultant 23

f. Word of mouth/ influencer 34

Q3. What is the purpose of taking an insurance policy?

a. Investment

b. Tax Saving

c. Old Age Saving

d. For Your Family Needs

e. For Certain Mishappening

f. Security

Q4. According to you which among the following Life insurance companies would youprefer?

LIFE INSURANCE CORPORATION

AVIVA LIFE INSURANCE

ICICI PRUDENTIAL HDFCSLIC

BIRLA SUN LIFE

OTHERS

Q5. Are you aware of the allocation charges of different insurance companies?

a. Yes

b. No


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Q6. Factors that influence your investment decisions in a particular company:

Ranking

Response

1 2 3 4 5 6 7 8

Brand

PromotionRelation withAgent

Rate of Return

Life InsuranceCover

Tax Benefits

Better Services

AllocationCharges

Q7. Which Companys Insurance do you have?

LIC

ICICI Prudential

Bajaj Allianz

HDFC

Birla Sun Life

Others Pls Specify..

Q8. Are you satisfied with the return, which you are getting from your current policies?

a. Very Satisfied

b. Satisfied


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c. Not Much Satisfied

d. Dissatisfied

Q9. Which type of fund will you prefer for investment ?

a. Whole Life Policy (5 to 6 % low risk) b. Endowment (9% moderate)

c. ULIP (>15% high risk)

d. Equity (very high risk)

Q10. Where do you generally like to invest your money?

Rating response

1 2 3 4 5

Insurance

Stock Market

Mutual fund

Bank / Fixed Deposits / PostOffice savings

Others (Real estate, Gold etc.)

Q11. What attracts you more to buy insurance?

a. Lower Premium Allocation Charges

b. Guaranteed Return c. Return Depend on Market

d. Any other ( please specify).

Q12. Which factor will you give preference while buying an insurance policy?

a. Brand

b. Policy Scheme

c. Relationship (agent)

d. Service

Q13. Which mode would you prefer to pay premium? a. Single Premium

b. Annually

c. Half Yearly

d. Monthly

PERSONAL INFORMATION :


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Name:

Age:

Occupation: a. Service

b. Business

c. Self employed

d. Retired

Income Level (per annum):

a. Below 2 Lac

b. 2 to 3 Lac .

c. 3 to 5 Lac

d. 5 to 7 Lac

e. 7 to 10 Lac

f. Above 10 Lac


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MKTG an Analysis of Indian Insurance Industry With Special Reference to HDFC STANDARD Life Insurance...

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