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TRANSCRIPT
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FINAL PROJECT REPORT
CONSUMER BEHAVIOUR TOWARDS VARIOUS
INVESTMENT AND INSURANCE PRODUCTS
. A Survey
A PROJECT REPORT
IN THE PARTIAL FULFILLMENT OF THE DEGREE OFMASTER OF BUSINESS ADMINISTRATION (MBA)
(2005-2007)
SUBMITTED BY: UNDER THE GUIDANCE:
MUKESH KUMAR MS. JASNOOR KAUR MBA-IV
SUBMITTED TO:
SAS
INSTITUTE OF INFORMATION TECHNOLOGY & RESEARCH
MOHALI
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ACKNOWLEDGEMENT
If words are considered as symbol of
approval and taken of appreciation then letthe words play the heralding role of
expressing my sincerest gratitude and
thanks
I am indebted to Mrs. Nisha Kapoor- Agency
Manager, inICICI Prudential Insurance Co., Mohali,
for providing me an opportunity to go through
project report.
I would like to express my sincere gratitude
towards Ms. JasnoorKaur (Coordinator) for having
provided me this golden opportunity to fulfillment of
my final project report for this span of time and also
for letting me work on this project.
(MUKESH KUMAR)
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PREFACE
Risks and uncertainties are part of lifes great adventure- accidents,
illness, theft, natural disaster they are all built into working of the universe
waiting to happen. So far that there is a solution - insurance.
To overcome these risks and uncertainties this project describes about
various policies and schemes of different insurance companies. How these
companies provide different benefits to policyholders. Insurance is acooperative venture where risks and uncertainties are shared by many. Now a
days a lot is being done to create awareness among the insuring public about the
need and importance of the insurance in the field of a human being. In this
direction IRDA has planned to create awareness through electronic and print
media.
A study of life insurance describes the meaning, various policies,
comparison and their analysis market prospective changing customer scenario.
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CONTENTS
1) Preface
2) Acknowledgement
3) Introductions :-
Definition
Need for Life Insurance
Role of Government
Role of Life Insurance
Evaluation of Insurance Industry in India
Future Scenario
4) Opening of Insurance Sector in India
Objectives of Liberalization of Insurance
5) Changing Expectations of Customers
6) Major Players in Life Insurance
ICICI Prudential
Life Insurance of India (LIC)
HDFC Standard Life
7) Comparison of the products of various companies
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8) Research Methodology
Research Methodology
Objectives
Limitations
9) Data Analysis and Findings
10) Conclusion
Findings
Suggestions
11) Appendices
Question
Bibliography
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INTRODUCTION
Insurance is basically risk management device. The losses to assets resulting
from natural calamities like fire, flood, earthquake, accident etc. are met out of the
common pool contributed by large number of persons who are exposed to similar
risks. This contribution of many is used to pay the looses suffered by unfortunate few.
However the basic principle is that loss should occur as a result of natural calamitiesor unexpected events, which are beyond the human control. Secondly insured person
should not make any gains out of insurance.
It is natural to think of insurance of physical assets such as motor car insurance
or fire insurance but often be forget that creator all these assets is the human being
whose effort have gone along way in building upto assets. In that scene human life is a
unique income generating assets. Unlike physical assets, which decrease with thepassage of time, the individual become more experienced and mature as he advances
in age. This raises his earning capacity and the purpose of life insurance is to protect
the income to individual and provide financial security to his family, which is
dependent on his income in the event of his pre-mature death. The individual also
himself also needs financial security for the old age or on his becoming permanently
disabled when his income will stop. Insurance also has an element of saving in certain
cases.
Insurance is are rupees 400 billion business in India and yet its spread in the
country is relatively thin. Insurance as a concept has not being able to make headway
in India. Presently LIC enjoys a monopoly in Life Insurance business while GIC
enjoys it in general insurance business. There have been very little option before the
customer to decide the insurer. A successful passage of the IRA bill have clear the
way of private sector operators in collaboration with their overseas partners. It is
likely to bring in a more professional and focused approach. More over the foreign
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periods of time, covering temporary risk situations, such as sea voyages. As life
insurance became more established. It was realized what a useful tool it was in a
number of situations, including :
1. Temporary needs/ threats :
The original purpose of Life Insurance remains an important element, namely
providing for replacement of income on death etc.
2. Regular Saving :
Providing ones family and oneself, as a medium to long-term exercise
(through a series of regular payment of premiums). This has become more relevant in
recent times as people seek financial independence from their family.
3. Investment :
Put simply, the building up of saving while safeguarding it from ravages of
inflation. Unlike regular saving products are traditionally lump sum investments,
where the individual makes are one time payment.
4. Retirement :
Provision for ones on later years has become increasingly necessary,
especially in changing culture and social environment. One can buy a suitable
insurance policy, which will provide periodical payments in ones old age.
BENEFITS :
1. It is superior to traditional saving machine
As well as providing a secure vehicle to build up saving etc. it provides piece
of mind to the policy holder. In the event ultimately death, of say the main earner in
the family, the policy will pay out guaranteed sum assured, which is likely to be
significantly more then the total premiums paid. With more traditional saving
vehicles, such as fixed deposits, the only return would be the amount invested plusany interested accrued.
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2. It encourages saving and forces thrift:
Once an insurance contract has been entered into, the insured has an
publication to continue paying premiums, until the end of the term of policy,
otherwise the policy will lapse. In other words, it becomes compulsory for the insure
to save regularly and spend wisely. In contrast savings held in a deposit account can
be accessed or stop easily.
3. It provides easy settlement and protection against creditors
Once a person appointed for receiving the benefits or a transfer of rights is
made (assignment), a claim under the life insurance contract can be settled easily. In
addition, creditors has no right to any mommies by the insurer, where the policy is
written under trust. Under the married womans act the money available from the
policy forms a kind of trust, which creditors can not claim on.
4. It can be encashed and facilities borrowing:
Sum contracts may allow the policy can be surrendered for a cash amount, if
policy holder is not in a position to pay the premium. A loan, against certain policy,
can be taken for a temporary period to tide over the difficulty. Presence of life
insurance policy facilitates credit for personal or commercial loans as it can be offered
as collateral security.
5. Tax relief :
The policy holder obtains income tax rebates by paying the insurance premium.
The specified form of saving which enjoys a tax rebate u/s 88 of the income tax act.
Include Life Insurance premiums and contribution to a recognized PF etc.
GOVT. ROLE :============
Govt. keen to reduce the dependency on the state via private pension
provisions. They have a choice between using compulsion and incentives. Most of the
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govt. choose the later method. Tax relief is guaranteed in the pension plants and is
extremely generous, reflecting the value that the govt. and the society and large place
on the provision of retirement benefits. Tax treatments of the benefit varies by country
and by benefits.
In India, the proceeds of gratuity and provident fund are tax free in the hand of
the members. In UK, a certain amount of the proceeds can be taken as tax lump sum
and reminder as taxable income. Benefits due on withdrawl from schemes are
generally taxed unless they are transferred to another scheme or approved pension
plan.
ROLE OF LIFE INSURANCE
Role 1 : Life Insurance as investment
Insurance is an attractive option for investment. While most people recognize
the tax hedging and tax saving potential of life insurance, many are not aware of its
advantages as an investment option as well as. Insurance products yield more
compared to regular investment option as this is besides the added incentives (read
bonuses) offered by insurers.
You can not compare an insurance product with other investment schemes for
simple reason that it offers financial protection from risks, something that is the
missing in non- insurance products.
Infact, the premium you pay for a investment against risk. Thus, before
comparing with other scheme, you must accept that a part of total amount invested in
life insurance goes towards providing for the risk cover, while the rest is used for
savings.
In life insurance, unlike non-products, you get maturity benefits on survival at
the end of the term. In other words, if you take a life insurance policy for 20 years and
survive the term the amount investor as premium in the policy will come back to you
with added returns. In the unfortunate event of death within the tenure of the policy,
the family of the deceased will receive the sum assured.
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Now, let us compare insurance as an investment options. If you invest Rs.
10000/- in PPF, year money grows to Rs. 10950 at 9.5% interest over a year. But in
this case, the access to your funds will be limited. One can withdraw 50% of the initial
deposit only after four years.
The sane amount of Rs. 10000/- can give you an insurance cover of upto
approximately Rs. 5 to 12 lacs. (depending upon the plan, age and medical condition
of life insure etc.) and this amount can become immediately available to the nominee
of the policy holder on death. Thus insurance is a unique investment avenue that
delivers sound returns in addition to protection.
Role 2 : Life Insurance as Risk Cover
First and foremost, insurance is about risk cover and protection financial
protection, to be more presize-to help out last once unpredictable losses. Designed to
safe guard against losses suffered on account of an unforeseen events. Insurance
provide you with that uniqueness sense of security that no other form of investment
provides. By buying life insurance, you buy peace of mind and are prepared to face
any financial demand that would hit the family incase of an untimely demise.
To provide such protection, insurance firms collect contributions for many
people who face the same risk. A loss claim is paid out of the total premium collected
by the insurance companies, who act as trustees to the monies.
Insurance also provides a safeguard in the case of accident or a drop in income
after retirement. An accident or disability can be devastating and an insurance policy
can lend timely support to the family in such time. It also comes as a great help when
you retire, in case untoward incident happens during the term in the policy.
With the entry of private sector player in insurance, you have a wide range of
products and services to choose from. Further, many of these can be further
customized to fit individual/group specific needs considering the amount you have to
pay now, its worth buying some extra sleep.
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ROLE 3 : Life Insurance as Tax Planning
Insurance serves as an excellent tax saving mechanism too. The Govt. of India
have offered tax incentives to life insurance products in order to facilitate the flow of
funds into productive assets. U/S 88 of Income Tax Act 1961, an individual is entitled
to rebate 20% on the annual premium payable on his/her life and life of his/her
children or adult children. The rebate is reducible from tax payable by a individual or
Hindu undivided family. This rebate is can be availed upto a maximum of Rs 12000/-
on payment of yearly premium of Rs 60000/- a year, you can buy anything upward of
Rs 100000/- in sum assured. This means that you get Rs 12000/- tax benefit. This
rebate is deductible from the tax payable by an individual or a Hindu undividedfamily.
THE EVALUATION OF INSURANCE INDUSTRY IN INDIA :
Life Insurance in its modern form is a western concept. The Indian insurance
industry is as old as it is in other part of the world. Although life insurance business
has been taking shape for the last 300 years, it came to India with the arrival of
Europeans. First Life Insurance Company was established in 1818 as Oriental
Insurance Company, mainly to provide for widows of Europeans. The companies that
follow mainly catered to Europeans and charged extra premium on Indian Lives. The
first insurance company insuring Indian Lives at standard rates was BOMBAY
MUTUAL LIFE INSURANCE COMPANY, which was formed in 1870. This was
also the year when 1st Insurance act was passed by the British Parliament. The years
subsequent to the Swadeshi movement saw the emergence of several insurance
companies. At the end of the year 1955 there were 245 insurance companies. All the
insurance companies were nationalized in 1956 and brought under one umbrella-
LIFE INSURANCE CORPORATION OF INDIA (LIC) which enjoyed a monopoly
of the Life Insurance business until near the end of 2000. by enacting the IRDA act
1999, the Govt of India effectively ended LICs monopoly and opened the doors for
private Insurance companies.
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Collaboration of Indian Companies with Foreign Companies
Indian Company Foreign Partner
Kotak Mahindra Chubb
Tata Group AIG
Sundram Finance Winterthur
Spic Metlife
ILFC Cigna
Alpic Finance Allianz
20th Century Canada Life
Vysa Bank ING
Cholamandlam Axa
SBI Alliance Capital
HDFC Standard Life
ICICI Prudential
Hindustan Times Commercial Union
IDBI Principal
Max India New York Life
FUTURE SCENARIO :-
Before looking in future prospectus of the insurance industry, we must take a
look into its past history. The independent India started with private sector Insurance
companies. These companies were nationalized by the union govt in 1956 to form a
monopoly known as Life Insurance Corporation of India has being under public sector
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for over four decades till the govt. opened the insurance sector for private companies
in 2000.
When the insurance Industry was nationalized, it was consider a land mark and
a milestone on the way to the socialistic pattern of society that India had chosen afterindependence. Nationalization has lent the industry solidity and growth, which is
unparalleled. Forever, along with these achievements there also grew a feelings of
insensitivity to the needs of the market, traditions in adoption of modern practices to
upgrades technical skills coupled with a scene of lethargy which probably led to a
feeling amongst that the insurance industry was not fully responsive to customers
needs.
The life insurance corporation of India has not succeeded in extending the
insurance cover to all the needy people of the country due to various reasons. LIC
could not insure very fast growth of insurance in India even in a long period extending
over four decades. Hence the penetration of insurance is very low in India. The
following indicates as explained and support this contention :
1. While per capita insurance premium in developed country is high, it is quitelow in India. For instance, per capital insurance premium in India in 1999 was only $8
while it was $4800 for Japan $1000 for Republic of Korea, $887 for Singapore, $823
for Hong-Kong and $144 for Malaysia.
2. Similarly the penetration of insurance is also assessed by the ratio of
Insurance premium to gross domestic products in a country. While insurance premium
as a percentage of GDP was 14 % in Japan, 13% for South-Africa, 12% for Korea,
9% for UK and France. It was only around 2% in India in 1999. hence the penetration
of insurance is low here.
3. The penetration of Insurance is also assessed by a ratio of Insurance
premium to gross domestic savings (GDS). While insurance premium as a percentage
of GDS was 52% for UK, 35 % for other European and American countries, it was
only 9% in India in 1999. Hence even this index indicates low level of penetration of
insurance in India.
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4. The share of India in the world market in terms of gross insurance premium
is again very small. For instance while Japan has 31%, European union 25%, South
Africa 2.3%, Canada 1.7% share of global insurance premium is only 0.3% for India.
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OPENING OF INSURANCE SECTOR IN INDIA
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The union government of India decided to open the insurance sector to make it
more dynamic and customer friendly.
OBJECTIVE OF LIBERALIZATION OF INSURANCE :-
The Main objective for the opening up the Insurance sector to the privateinsures as under :-
To provide better coverage to the India citizens.
To augment the flow of long term financial resources to finance the growth ofinfrastructure.
Indian Insurance industry has ten new entrants in year 2000-2001 in Life Insurance
sector.
S.No Reg No Date of Reg Name of Company
1 101 23.10.2000 HDFC Standard Life Insurance CO. Ltd
2 104 15.11.2000 Max New York Life Insurance CO. Ltd
3 105 24.11.2000 ICICI Prudential Life Insurance CO. Ltd
4 107 10.01.2001 OM Kotak Mahindra Life Insurance CO Ltd
5 109 31.01.2001 Birla Sun Life Insurance CO. Ltd
6 110 12.02.2001 Tata AIG Life Insurance CO. Ltd
7 111 20.03.2001 SBI Life Insurance CO. Ltd
8 114 02.08.2001 ING Vyasya Life Insurance CO. Ltd
9 116 03.08.2001 Allianz Bajaj Life Insurance CO. Ltd
10 117 06.08.2001 Metlife Insia Life Insurance CO. Ltd
Insurance Industry in the year 2000 has one new entrant in Life Insurance
Business name :-
S.No Reg No Date of Reg Name of Company
1 121 03.01.2002 AMPSANMAR Assurance Co. ltd
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CHANGING CUSTOMER EXPECTATIONS IN INSURANCE SECTOR
PRE TO POST LIBERALISATION
RESEARCH OBJECTIVE AND METHODOLOGY
OBJECTIVE :-
To provide insight into customers experiences prior to recent liberalization,
mapping changes in expectations after liberalization and perceived performance of
insurance players viz a viz expectations.
RESEARCH APPROACH :-
In depth qualitative study to capture indicative trends which can be strictly
validated, if required :
Geographical coverage : Delhi, Mumbai, Kolkata, Hyderabad and Banglore
RESEARCH DESIGN :-
RESPONDENT SEGMENT
Life Policy Holders :-
Old Customers : Taken Insurance prior to liberalization only.
Evolved Customer : Taken insurance both in per and post liberalization.
New customers : Taken Insurance in post liberalization only.
Sources of information on Insurance and Product Awareness
Friend, colleagues, relatives and agent additionally from direct
Low awareness of several Insurance mailers, customer meets products due
to poor communication Internet and media in spite of availability. Rising
level of awareness of new product of both LIC and private Company
CHANGING CUSTOMER EXPECTATIONS LIFE
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EXPECTATIONS FROM THE COMPANY:
Premium notice should be settled regularly.
Premium payment reminder should be sent through SMS and E-Mail.
Cheque payment at bank, imternt and special collection centres ( Om
Kotak in Mumbai )
Payment through credit cards.
Facility of purchasing policy through more channels.
Flexible/wider range of products.
Focus on cutomer education.
Fine/prints devi in detail, correct disclosures. Transparent and fair dealings.
Information on new products/services through call centres, internet,
mailers, new agent customer meets. Set up toll free help line.
Where customer is cancelled is deposited should be entitled to be the
commission thereof.
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COMPANY PROFILE
INTRODUCTION
ICICI Prudential Life Insurance Corporation Ltd. was incorporated on
20.7.2002. This company is a joint venture of ICICI(74%) and Prudential PLC
UK(26%).
The company was granted certificate of registration for carrying out Life
Insurance Business, by the Insurance Registry and Development authority on Nov
24.2000. it commenced commercial operations on Dec 19.2000, becoming one of the
few private sector players to enter the liberalized arena.
DETAILS OF ICICI :-
This is Indian participate company of this insurance Co.. ICICI Ltd was
established in 1955 by World Bank, the govt. of India and the Indian Industry, to
promote industrial development of India by providing project and corporate finance to
Indian Industry.
Since inception, ICICI has grown from a development bank to a financial
conglomerate and has become one of the largest public financial institutions in India.
ICICI has thus far financed all the major sectors of the economy, covering 6848
companies and 16851 projects.
DETAILS OF PRUDENTIAL PLC :-
Prudential Plc was founded in 1848. Since then it has grown to become
one of the largest providers of a wide range of savings products for the individuals
including life insurance, pensions, annuities, unit trust and personal banking. It has
presence in 15 countries, and caters to the financial needs of over 10 million
customers.
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Prudential is the largest life insurance company in the United Kingdom. Asia
has always been an region for prudential and it has had a presence in Asia for 75
Years. In fact Prudential first Overseas operation was in India, way back in 1923 to
establish Life and General Branch agencies.
This is the only company who market maximum product with goof feature in
competition with LIC. In my opinion these companys stand seconds in merits. It has
introduced the following Insurance product :-
1. Save n Protect
2. Cash Back
3. Smart Kid
4. ICICI PRU Life Guard
5. Life Time Pension.
1. SAVE N PROTECT :-
It is a fix term policy that combines saving with life cover in this plan, you pay
premium regularly during the term. On death of the life assure upto age 7 years thebasic premium paid will be return without interest. On the death of the life assured
after 7 years, the beneficiary will get the sum assured, guaranteed additions 3.5%
compounded interest annually for the first 4 years and the vested bonuses was the
policy matured at the end of the term, you can get the full sum assure and guaranteed
addition, 3.5% a compounded annually for the 1st 4 years as well as the vested
bonuses.
Minimum Age 0 years
Maximum Age 60 years
Term to Avail the plan :
Minimum term 10 years, maximum term 30 years
The maximum cover ceasing age is 70 years.
2. CASH BANK :-
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A fixed term policy of 15 to 20 years in which premiums are paid through out
the term of the policy. Survival benefit payment at regular intervals are paid to
provide you with the liquidity full sum assured, along with the guaranteed addition
3.5% compounded annually for the 1st
four years at the vested bonuses would bepayable on death, irrespective of the survival benefit paid. On death of the life
assured, the beneficiary will get the full sum assure, the guaranteed bonuses and the
vested bonuses, irrespective of the survival benefit already paid. The survival benefit
payable are as per the table :
Policy Term 15 Years Policy Term 20 Years
At end of year Survival pay. a %
basic
sum assured
At the end of year Survival pay a % bas
sum assured
3 10% 4 10%
6 15% 8 15%
9 20% 12 20%
12 25% 16 25%
15 (Maturity) 50% gur add. bonus 20 (Maturity) 50% gur add. bonus
Minimum Age 16 YearsMaximum Age 55 years
Term to Avail Plan:
Minimum Term 15 yearsMaximum Term 20 Years
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The maximum maturity age is 70 years
3. SMART KID :-
Smart kid is so designed that it provides you the flexibility to structure thebenefit in accordance to your needs. You get the security of assured payments under
your plan depending upon the benefit structure chosen by you. Whats more, you can
decide the term of the plan, so that the benefit are paid when you need it. You can also
choose the policy to mature between 22-25 years of the childs age. In case of
survivals during the term of the policy you can get the payouts after some intervals.
At the end of Childs age Payouts
10 yr of the policy 15 years 20% of the sum assured
12 yr of the policy 17 years 25% of the sum assured
15 yr of the policy 20 years 25% of the sum assured
17 yr of the policy 22 years 30% of the sum assured
+ GA + VB
Minimum Age 0 YearsMaximum Age 12 years
Parents of Minimum age 20 years and Maximum age 60 years
Term to Avail Plan:
Minimum Term 10 years
Maximum Term 25 Years
4. LIFE TIME PLAN :-
ICICI Prudential Life time Pension Plan combine the best of investment and
insurance. The solution gives the power of maintaining your life style needs for as
long as you live. It is a regular premium plan it gives you the freedom to choose the
amount, the premium, and invest your money in the market-linked funds, to generate
potentially higher returns. A part of the premium paid is used to pay for the death
benefit (if any) opted for by you and the rest be invested in the plan of your choice.
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On the retirement date the accumulated value of the units will be used to purchase and
annuity-to provide you with regular income for life.
Minimum Age 18 Years
Maximum Age 60 years
Term to Avail Plan:
Minimum Term 10 years
Maximum Term 52 Years
5. LIFE GUARD :-
Under this plan, a sum assure is payable in case of death of the life assure
during the term of contract. One can choose the lump sum that would replace the
income lost to ones family in the unfortunate event of the ones death. Since this non-
participating (without profits) plan is a pure, risk cover plan, no benefits are payable
on survival to the end of the term of the policy.
Minimum Age 18 Years
Maximum Age 50 years
Term to Avail Plan:
Minimum Term 5 years
Maximum Term 25 Years
Maximum age that plan covers is 65 years
Minimum premium payable is 2400 per annum
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PROFILE
OBJECTIVES :-
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Spread Life Insurance much more widely and in particular to the rural areas
and to the socially and economically backward classes with a view to reaching all
insurable persons in the country and providing them adequate financial cover against
death at responsible cost.
Maximum mobilization of peoples savings by making insurance-linked
savings adequately attractive.
Bear in mind, in the investment of funds, the primary obligation to its policy
holders, whose money it holds in trust, without losing sight of the interest of the
community as whole, keeping in view national priorities and obligation of attractive
return.
Conduct business with almost and with the full realization that the money
belongs to the policy holders.
Act as trustees of the insured public in their individual and collective
capacities.
Involve all people working in the corporation to the best of their capability in
furthering the interests of the insured public by providing efficient service with
courtesy.
Promote amongst all agents and employees of the corporation a sense of
participation, pride and job satisfaction through discharge of their duties with
dedication towards achievement of corporate objective.
PRODUCTS :-
1. Term Insurance Plan
2. Endowment Plan
3. Money Back Plan
4. Jeevan Mitra Plan
5. Jeevan Sathi Plan
6. Jeevan Surbhi Plan
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7. Children Plan
a. Bal Vidya
b. Jeevan Chhaya
c. Children Money Back
TERM INSURANCE PLAN :-
Availability of Plan :-
Minimum Age of 12 Years
Maximum Age of 60 Years
Term to Avail Plan :-
Minimum Term 5 years
Maximum Term 55 years
Maximum Age that plan cover 70 years
ENDOWMENT PLAN
Availability of the plan :
Minimum age 12 years.
Maximum age 65 years.
Term to Avail plan :
Minimum term 5 years.
Maximum term 55 years.
Maximum age that the plan cover 75 year.
MONEY BACK PLAN :-
Term to Avail Plan :
20,25 and 30 years for regular premium.
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Maximum age that plan will cover till 70 years.
JIVAN MITRA POLICY :-
Availability of the Plan :-
Minimum Age 18 years
Maximum Age 50 years
Term to Avail plan :-
Minimum Term 15 years
Maximum age 30Years
Maximum Age that Plan cover is 70 years.
JIWAN SATHI
Availability of the Plan :-
Minimum Age 20 years
Maximum Age 50 years
Term to Avail plan :-
Minimum Term 15 years
Maximum age 30Years
Maximum Age that Plan cover is 70 years.
CHILDREN PLAN :-1. CHILD AS A POLICY HOLDER
2. PARENTS AS A POLICY HOLDER & CHILD AS BENIFICIARY
Child as a policy Holder :-
Jeewan Sukanya
Jeewan Kishore
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Jeewan Sukanya :-
Availability of the Plan :-
Minimum Age 1 years
Maximum Age 12 years
Term to Avail plan :-
Minimum Term 38 years
Maximum age 49Years
Maximum Age that Plan cover is 20 years.
CHILDREN MONEY BACK POLICY :-
Availability of the Plan :-
Minimum Age 0 years
Maximum Age 10 years
Term to Avail plan :-
Minimum Term 16 years
Maximum age 26Years
Maximum Age that Plan cover is 26 years.
GENERAL BENEFITS :-
PREMIUM WAIVER BENEFITS :-
For a policy taken on the life of a child (children policies-Jeewan Kishore,
Jeewan Sukanya, Jeewan Balya & children money back policy) the premium is paid
by the proposer. Under these policies the proposers life is not covered. It means if
proposer dies before maturity of the policy, no money becomes payable to the family.
On the death of the proposer, the family will loose the income of the propser. Inaddition to this problem, the other family members has to continue the payment of
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premium. To avoid this problem, the premium waiver benefit can be opted for, by the
proposer. Under this benefit, if the propser dies before maturity of the policy, future
premium are waived future premium not be paid by the other family members. The
premium waiver benefit may be obtained by paying some extra premium depending
upon the age of the policy holder. This extra premium is calculated 100 rupee of basic
premium per thousand.
TERM RIDER BENEFIT :-
Under children money back policy, the life risk covered is that of the child. If
the proposer dies pre maturely, no money becomes payable to the family. To avoid
this problem the term rider can be added to the childrens money back policy. Underthis benefit if proposer dies before 18 years of the child a sum equal to 20% of the
sum assure becomes payable to the family. Other benefits to the child
TAX BENEFIT :-
The premiums paid under the plan qualify for rebate U/s 88 of the Income Tax
Act, 1961 and the returns are fully exempted under sec 10(10D).
OPTIONAL BENEFITS :-
Critical Illness, Double Sum Assured Benefits, Accidental Death Benefit etc.
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HOUSING DEVELOPMENT FINANCE CORPORATION LTD. (HDFC):
Founded in 1977, HDFC is today the market leader in housing finance in India
and has extended financial assistance to more than 15 lacs homes. HDFC has more
than 110 offices in India presently. It has also one international office in Dubai and 3
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more services associate in Kuwait, Qatar and sultanate of OMAN. HDFCs assets base
amount to over 15,000 crore. Its financial strength is reflected in highest safety rating
of FAAA and MAAA awarded by CRISIL and ICRA two of Indias leading
credit rating agency respectively, for the last 6 year consecutively. It has a depositor
base of over 11 lacs customer and a deposit agents force of over 46,000 of the total
deposit, 73% are sourced from individual and trust depositors, which demonstrates the
tremendous confidence that retail investors have in the company.
HDFC- promoted companies have emerged to meet the investors and
customers needs. HDFC bank for commercial banking, HDFC Mutual Fund for
mutual fund products, to be followed very shortly by HDFC Standard Life Insurance
Company for the life insurance and pension products.
Being an institution that is strongly committed to the highest standards of
quality and excellence, HDFC has won several accolades in the past few years. One
such award is the Ramakrishnan Bajaj National Quality Award for the year 1999.
This award was instituted to award recognition to Indian companies for business
excellence and quality achievement. HDFC is the only company so far to receive this
award in the service category.
STANDARD LIFE ASSURANCE COMPANY ( SLAC ) :
Founded in 1952, Standard Life has been at the for frontry of the UK Insurance
industry for 176 years by combining sound financial judgement with integrity and
reliability. The kingdom, Ireland, Spain, Germany and some more with representative
office in Hong-Kong and China.
One of the most recent success was the launch of standard Life Bank on 1 st
January 1998. In less than 20 months, the bank collected Rs. 28,000 crore in deposit.
The introduction of its innovative mortgage product in Jan. 1999, had an immediate
impact on the UK market, accounting for 11% of all new lending within the first
operational tear. The current loans outstanding amount to Rs. 43,300 crore.
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Standard Life has total assets of Rs. 55,000 crore and new premium income last
year 33,000 crore. Its UK investment portfolio account for approximately 2% of all
shares listed in the London Stock Exchange. Its one of the new Insurance companies
in the world to receive AAA rating from two of the leading international credit rating
agencies. Moodys and Standards And Poors. The latter described Standard Lifes
ability to meet its claim obligations as overwhelming under a variety of economic
conditions.
Not surprisingly, Standard Life is rated as one of the few strongest companies
in the world, in financial terms. The quality and value standard Life brings to this
venture are immense. The companys reputation in UK market remains unrivalled.
Besides being voted Company of the ears for overall service, for the third
consecutive year. Standard Life was recently voted Company f the decade by
independent brokers.
PRODUCTS
1. TERM ASSURANCE PLAN
2. ENDOWMENT ASSURANCE PLAN
3. MONEY BACK PLAN4. CHILDRENS PLAN
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5. PERSONAL PENSION PLAN
6. SINGLE PREMIUM WHOLE OF LIFE INSURANCE PLAN
7. UNIT LINKED PENSION PLAN
8. UNIT LINKED ENDOWMENT PLAN
Protection against uncertainties of life
TERM ASSURANCE PLAN :-
Minimum age 18 years.
Maximum age 60 years.
TERMS TO AVAIL PLAN :
20,25 and 30 years that plan can cover till 65 years.
ENDOWMENT PLAN :-
Minimum age 12 years.
Maximum age 60 years.
TERM TO AVAIL LOAN :-
Minimum term 10 years.
Maximum term 30 years.
Maximum age that plan can cover till 75 years.
MONEY BACK PLAN :-
Term
policy term
No. of years from policy date
5 10 15 20 25
10
15
20
40%
30%
25%
30%
25% 25%
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25
30
20%
15%
20%
15%
20%
15%
20%
15% 15%
Minimum age 12 years.
Maximum age 60 years.
TERM TO AVAIL PLAN :-
Minimum term 10 tears
Maximum age 30 tears
Maximum age that plan can cover till 75 years.
CHILDEREN PLAN :-
Option On the death of the insured
person during the policy
term
On maturity
Maturity benefit Future premiums waived
and the policy continued
till maturity
Sum assured + bonuses
Accelerated benefit plan Sum assured + bonus paid
and the policy stops
On the survivals of the
insurance. Parent of the
maturity date
Sum assured + bonus paid
Double benefit plan Sum assured paid, future
premium waived and the
continue
Sum assured + bonuses
paid
Minimum age 18 yearsMaximum age 60 years
TERM TO AVAIL PLAN :-
Minimum term 10 years
Maximum term 25 years
Maximum age that plan can cover till 75 years
PERSONAL PENSION PLAN :-
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Minimum age 18 years
Maximum age 60 years
SINGLE PREMIUM WHOLE OF LIFE INSURANCE :-
Minimum age 18 years.
Maximum age 70 years
You can buy the product on a single life basis
Minimum sum assured 25000
Maximum sum assured 500000
Premium : Rs 950 per thousand of sum assured
GENERAL BENEFITS :-
PREMIUM WAIVER BENEFIT :-
For a policy taken on the life of a child (children policies Jeewan Kishore,
Jeewan sukanya, Jeewan balya and children money back policy) the premium is paid
by the proposer. Under these polices the propsers life is not covered. It means ifproposer dies before maturity of the policy, no money becomes payable to the family.
On death of the proposer, the family will loose the income of the proposer. In addition
to this problem the family has to continue the payment of premium. To avoid this
problem, the premium waiver benefit can be opted for, by the proposer. Under this
benefit, if the proposer dies before maturity of the policy, future premium are waived
future premium not to be paid by the other family members. The premium waiver
benefit may be obtained by paying some extra premium depending upon the age of the
policy holder. This extra premium is calculated per 100 rupee of basic premium per
thousand.
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As it is difficult to compare all the policies of all the companies because they
vary in their benefits etc. So in this project I am comparing only four policies of three
Companies i.e. HDFC Standard Life, LIC, ICICI Prudential.
Policies are named as :
TERM ASSURANCE PLAN
ENDOWMENT ASSURANCE PLAN
MONEY BACK PLAN
CHILD ADVANTAGE PLAN
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Min to Max Age Premium Base Comparison Min to Max. term
18-60 years Term Plan 10-30 years
Name of the
company
HDFC SLIC LIC ICICI PRO OM KOTAK
Age of the
person
30 years 30 years 30 years 30 years
Term of the
policy
10 years 10 years 10 years 10 years
Sum assured 1,00,000 1,00,000 1,00,000 1,00,000
Basic
premium
(without any
premium)
10,300 9,324 11,809 11,237
Returns (on
death)
S.A. + Bonus S.A. +
Bonus
S.A. + Bonus S.A. + Bonus
Returns (on
maturity)
NI2 NI2 NI2 NI2
other benefits (CI),(ADB),(ASA) (WOP),
(ADB)
(ADBR),(ABR) (CI),(ADB)(PDB)
Min to Max Age Premium Base Comparison Min to Max. term
12-60 years Endowment Plan 10-30 yearsName of the
company
HDFC SLIC LIC ICICI PRO OM KOTAK
Age of the person 30 years 30 years 30 years 30 years
Term of the policy 20 years 20 years 20 years 20 years
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Sum assured 1,00,000 1,00,000 1,00,000 1,00,000
Basic premium
(without any
premium)
5,100 4,895 5,216 5,321
Returns (on death) S.A. + Bonus S.A. +
Accumulate
d Bonus
S.A. + Bonus S.A. + Bonus
Returns (on
maturity)
S.A. + Bonus S.A. +
Bonus
S.A. +
Bonus+ GA
S.A. + Bonus
Other benefits (CI),(ADB),
(DSA),(WOP)
(WOP),
(ADB)
(ADB),
(ABR), (CI),
(MSR)
(CI),(ADB)(DSA),
(2GD), (TB)
Min to Max Age Premium Base Comparison Min to Max.
term
12-60 years Money Back Policy 10-30 yearsName of
the
company
HDFC SLAIC LIC ICICI PRO OM KOTAK
Age of the
person
30 years 30 years 30 years 30 years
Term of thepolicy
20 years 20 years 20 years 25 years
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Sum assured 1,00,000 1,00,000 1,00,000 1,00,000
Basic
premium
(without any
premium)
7,585 6,380 7,019 6,040
Returns (on
death)
S.A. + Bonus S.A. + Bonus S.A. + Bonus S.A. + Bonus
Returns (on
maturity)
Return after 5-5
years
For 20 Years
Policy 20%-20%
and 20% alte 5-5
years gap+
Bonus
Return after 5-
5 years
For 20 Years
Policy 20%-
20% and 20%
alte 5-5 years
gap+ Bonus
In 20 years
Policy
returns after
4-4 years
gap.
1st year-10%
2nd year-15%
3rd year-20%
4th year-25%
On maturity-
50%+ Bonus
Return after 5-5
years
For 20 Years
Policy 20%-20%
and 20% alte 5-5
years gap+ Bonus
Other
benefits
(CI),(ADB),
(DSA),(WOP)
(WOP),
(ADB)
(ADB),
(DAB), (CI),
(MSR)
(CI),(ADB),
(PDB), (2GD)
Min to Max Age of Child 0-17 Premium Base ComparisonMin to Max. term
Min to Max Age of Policy Holder Children Policy 10-30 years
12-60 years
Name of the
company
HDFC SLIC LIC ICICI PRO OM KOTAK
Age of the
Child
6 years 6 years 6 years 6 years
Term of the
policy
15 years 15 years 15 years 15 years
Sum assured 1,00,000 1,00,000 1,00,000 1,00,000
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Basic premium
(without any
premium)
7,500 6,380 7,991 7,620
Returns (on
death)
Future
premiumwaived and
Policy
continue till
maturity
Future
premiumwaived and
Policy
continue till
maturity
Future
premiumwaived and
sum assured
immediately
after the death
Future premium
waived and Policycontinue till maturity
Returns (on
maturity)
Sum assured+
Bonus
Return after 2-
2 years
gap 20 % -20%-30%
-30% and
Bonus
Return after 2-
2 years gap on
maturity S.A.+Bonus
Sum assured+ Bonus
Other benefits (ADB,(WOP) (PWP), (TRB) (ADB),(IBR),
(ABR),(WOP)
(LGB),(ADB),(WOP)
OTHER BENEFITS :-
1. Tax Benefit
2. Loan Facility
3. The policy holder can pay the premium yearly, half yearly and quarterly
4. If policy holder avail any additional, he will paid more premium
5. The best of most popular plan of:
HDFC CHILDREN PLAN
ICICI LIFE TIME
LIC JEEVAN MITRA
OM KOTAK CAPITAL MULTIPLE
6. When the age of the person grow old. The premium also increased
7. Premium rate increased in case of person taking intoxicants in
comparison to healthy person.
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1) Questionnaire method was used by me, with most of the
questions as the closed ended questions.
2) Sample Size - 200
3) Age Group - above 22
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OBJECTIVES OF THE STUDY :-
1. To know about the requirement habit of the people in the region of
Chandigarh & Mohali.
2. To know about the views of people regarding various Insurance
Companies.
3. Position of the Insurance companies in the mind of the consumer
4. To know about the competition regarding various Insurance Companies.
5. To find out the position of Insurance Companies in the market.
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LIMITATIONS :-
1. Most of the people are not interested to give the right data.
2. Some people dont know about the private Companies.
3. A span of 4 weeks training was too short for survey.
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DATA ANALYSIS AND FINDINGS :-
QUES 1 : Awareness of the Various companies :
S.No. Particulars %age
A ICICI 70%
B HDFC 60%
C OM Kotak Mohindra 5%
D MAX New York Life Insurance 15%
E SBI Life Insurance 10%
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0%
10%
20%
30%
40%
50%
60%
70%
%age
ICICI
HDFC
OM Kotak Mohindra
MAX New York Life Insurance
SBI Life Insurance
Respondent response about the awareness of the insurance Companies
QUES 2 : How the people know about the companies
S.No. Particulars %age
A Newspaper 75%
B TV Ads 60%
C Banners/Posters 2%D Friends 90%
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0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
%age
Newspaper TV Ads
Banners/Posters Friends
QUES 3: What the people think about the Insurance
S.No. Particulars %age
A Necessity for protection
Security
89%
B Imposition of an extra burden
of expenses
5%
C A compulsory tool for tax
saving
78%
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0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
%age
Neccesity for protection Security
Imposition of an extra burden of expenses
A compulsory tool for tax saving
QUES 4: Main considerations that a customer looks at while purchasing an
Insurance Policy.
S.No. Particulars %ageA TAX 90%
B SAVING 75%
C PROTECTION 80%
D PENSION 25%
E INVESTMENT 35%
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0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
%age
TAX SAVING PROTECTION
PENSION INVESTMENT
QUES 5 : What a respondents see while purchasing a Insurance from the
Company.
S.No. Particulars %age
A Standing and Goodwill of the company 90%
B Product Range of the company 10%
C Advertisement being released by thecompany
5%
D Services being given by the company 80%
E Communications and knowledge of theRepresentatives
10%
F Returns of Bonus declared by thecompany
85%
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0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
%age
Standing and Goodwill of the company
Product Range of the company
Advertisement being released by the company
Serv ices being give n by the company
Communications and knowledge of the
RepresentativesReturns of Bonus declared by the company
QUES 6 : Excising Policy
S.No. Particulars %ageA Yes 80%
B No 20%
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0%
10%
20%
30%
40%
50%
60%
70%
80%
%age
Yes No
QUES 7 : From where a respondent purchase the previous Insurance Policy
S. No. Particulars %age
A Directly from the company 10%
B Any unknown agent 10%
C Any known agent 75%
D Others 5%
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0%
10%
20%
30%
40%
50%
60%
70%
80%
%age
Directly from the companyAny unknown agent
Any known agent
Others
QUES 8 : Other Investment and Saving Tools where respondent Invest
S. No. Particulars % age
A NSC 90%
B Bank Deposits 40%
C KVP 5%
D Tax Saving Bonds 55%
E PPF and Post Office 92%
F Others 5%
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0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
% age
NSC Bank Deposits
KVP Tax Saving Bonds
PPF and Post Office Others
CONCLUSIONS
FINDINGS AND RECOMMENDATIONS :
1. The Monopoly of LIC has been broken because private Insurance
companies came into the market.
2. 90% respondents are aware of privatization of Insurance Industry and 10%
respondents do not know about private companies.
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3. 80% people know about ICICI Insurance Company. 75% people know
about HDFC Insurance Company and 15% people know about other
companies.
4. Some people preferred to the private companies because of their better
services.
5. Some people believe only or preferred only Public Insurance companies
like LIC.
6. As majority of the population of Chandigarh & Mohali City belongs to the
service class so they consider tax saving rather than purchasing a Life
insurance.
7. The Financial growth of Private companies is much more than Life
Insurance companies
8. The private companies always keep in touch with their customers with the
latest information.
9. Most of the respondent said that private companies should not be
trustworthy.
10. Most of the people go for Children benefit because of Triple benefit.
11. Now, a days people preferred to invest the money in Insurance policy rather
than in Banks because of better benefits of Insurance polices growth
money with life cover.
12.The respondents are above 45 they believe in Public Insurance companies
and those respondents who are less than 45 believe in Private Insurance
companies.
13. HDFC has made its presence felt in the market in a short span of time.
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SUGGESTIONS :
1. Advertisement should be done on Television and especially Posters and
Banners. This will greatly help in raising awareness level.
2. Insurance company should show more commitment with the customer.
3. Private companies give better services to the customers comparatively to
Public companies.
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4. The private company should create good relation and communication.
5. Private companies should work together to spread awareness regarding
the benefit given by the Private Companies.
6. Private Insurance Companies give some discount to attract the customer
7. A public relation officer should be appointed in the company who deals
with customers and their needs.
8. Cross training should introduce in Private Companies.
9. Private Companies needs to the market their product better and should
create greater awareness about their product and services. They need
extensive marketing advertising about the additional benefit provided by
them in comparison to the policies offered by LIC.
10. Agents have got maximum influence on a customer. They are the one
who introduce the prospect to different policies. So agents should be
given full-fledged training and the training should be strict.
11. Special emphasizes should be on known cover policies because these
type of policies have more potential in the market.
BIBLIOIGRAPHY
Study Material Of HDFC STANDARD LIFE INSURANCE
Study Material Of LIC
Study Material Of ICICI PRUDENTIAL
WEBSITES
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www.hdfcstandardlife.com http://www.hdfcstandard.com
www.licindia.com http://www.licindia.com
www.icicipufile.com http://www.iciciprulife.com
www.bimaonline.com http://www.bimaonline.com
http://www.hdfcstandardlife.com/http://www.licindia.com/http://www.licindia.com/http://www.bimaonline.com/http://www.hdfcstandardlife.com/http://www.licindia.com/http://www.licindia.com/http://www.bimaonline.com/