final report(2)

To study development in insurance sector in rural area with reference bajaj allianz

On

IN BAJAJ ALLIANZ LIFE INSURANCE LTD Agra

Submitted in partial fulfillment for the award of the degree of

Master of Business Administration(Batch 2009-11)

Under the guidance of

Supervisor (External guide) Internal guide Mr kapil Mrs.pooja mam (Sr field Manager) faculty Agra (UP) GIIT, Gr. Noida

Submitted by Neeraj kumar

(MBA IIIrd Sem)

Global Institute Of Information Technology32-A, Knowledge Park-1, Greater Noida (U.P)

ANNEXURE-4

[1]


DECLARATION

I hereby declare that this Project Report entitiled

_______________________________ submitted by me to the UP

Technical University Lucknow, is a bonafide work undertaken by me

and it is not submitted to any other university or Institution for the

award of any degree diploma/certificate or published any time before.

Name: _______________________

Enrollment:- _______________________

Semester:- _______________________

Date:- _______________________

__________________Signature of the student

[2]


CERTIFICATE OF ORIGINALITY

This Is Certify That The Project Entitled “A Comparative Analysis

Consumer Behavior In Relation To Health Care Products Of SCH

With Respect To Other Brands Present In The Market “ Is Bonafide

Work Done By Mr. Dharmendra Kumar Roll No 0915170017, In Partial

Fulfillment Of MBA Student Examination And Has Been Carried Out Under

My Supervision And Guidance. This Report Or A Similar Report On The

Topics Has Not Been Submitted For Any Other Examination And Does Not

Form Part Of Any Other Course Undergone By The Candidate.

Signature of the candidate Signature of the Guide/Supervisor

Place: Name:

Date: Designation: Address:

Head of the Institution

[3]


Preface

Class room study is the foundation which is essential but getting down cat from a tree is

different whenever it comes.

To bridge the gap between the theory and practical it is essential for student to step out of

the classroom and move around the corporate world. Classroom theory can pass on

knowledge but attitude and skill can be inherited from actual market exposure. Bajaj

Allianz Life Insurance Provided me an opportunity to experience the actual market

condition.

It is correctly said that marketing is nearly a civilized form of welfare. Our most of the

battles won by civilized thinking and positive attitude.

This training had not only provided me the market exposure but also equipped me

attitude and skill to become a successful marketer.

[4]


ACKNOWLEDGEMENT

First of all I would like to thank the management at Bajaj Life Insurance Company for

giving me the opportunity to do my summer training in their esteemed organization. I am

highly obliged to Mr. Kapil (Field Manager) and for granting me an opportunity to

undertake training in Jhansi Branch.

I express my thanks to all sales managers under whose able guidance and direction, I was

able to give shape to my training. Their constant review and excellent suggestions

throughout the project are highly commendable.

My sincere thanks to all executives who helped me gain knowledge about the actual

working and processes involved in various departments.

I am grateful to my teacher Mrs. Pooja mam who has helped in making this project.

His valuable guidance has helped in preparing this project.

[5]


Executive Summary

The service industry is one of the fastest growing sectors in India today. The

upcoming sectors which are really showing the graph towards upwards are - Telecom,

Banking, and Insurance. These sectors really have a lot of responsibility towards the

economy.

Amongst the above-mentioned areas insurance is one sector, which took a lot of

time in positioning itself. The insurance business of non-life companies was not much in

problems but the major problem was with life insurance. Life Insurance Corporation of

India had monopoly for more than 45 years, but the picture then was completely

different. Previously people felt that “Insurance is only for classes not for masses” but

now the picture is vice-versa.

The story of insurance is probably as old as the story of mankind. The same

instinct that prompts modern businessmen today to secure themselves against loss and

disaster existed in primitive men also. They too sought to avert the evil consequences of

fire and flood and loss of life and were willing to make some sort of sacrifice in order to

achieve security. Though the concept of insurance is largely a development of the recent

past, particularly after the industrial era – past few centuries – yet its beginnings date

back almost 6000 years.

Life Insurance in its modern form came to India from England in the year 1818.

Oriental Life Insurance Company started by Europeans in Calcutta was the first life

insurance company on Indian Soil. All the insurance companies established during that

period were brought up with the purpose of looking after the needs of European

community and these companies were not insuring Indian natives. However, later with

the efforts of eminent people like Babu Muttylal Seal, the foreign life insurance

companies started insuring Indian lives. But Indian lives were being treated as sub-

standard lives and heavy extra premiums were being charged on them. Bombay Mutual

Life Assurance Society heralded the birth of first Indian life insurance company in the

[6]


year 1870, and covered Indian lives at normal rates. Starting as Indian enterprise with

highly patriotic motives, insurance companies came into existence to carry the message

of insurance and social security through insurance to various sectors of society. Bharat

Insurance Company (1896) was also one of such companies inspired by nationalism. The

Swadeshi movement of 1905-1907 gave rise to more insurance companies. The United

India in Madras, National Indian and National Insurance in Calcutta and the Co-operative

Assurance at Lahore were established in 1906. In 1907, Hindustan Co-operative

Insurance Company took its birth in one of the rooms of the Jorasanko, house of the great

poet Rabindranath Tagore, in Calcutta. The Indian Mercantile, General Assurance and

Swadeshi Life (later Bombay Life) were some of the companies established during the

same period. Prior to 1912 India had no legislation to regulate insurance business. In the

year 1912, the Life Insurance Companies Act, and the Provident Fund Act were passed.

The Life Insurance Companies Act 1912 made it necessary that the premium rate tables

and periodical valuations of companies should be certified by an actuary. But the Act

discriminated between foreign and Indian companies on many accounts, putting the

Indian companies at a disadvantage.

The formation of IRDA, entrance of private life insurance companies into India

with one foreign partner, compulsory training of Insurance agents etc. developments

started to take place. And this was the time when these companies started searching for

proper channel partners who can help the organization in expanding its network and

business in India.

Channel partners are those who are going to be into direct selling of company’s

products i.e. the insurance policies. They are the link between the customers and the

management or company. These channel partners are people with different profiles. They

are selected on some grounds like their network of people, their problem handling ability,

convincing power and lot many things.

The main idea behind company’s Questionnaire Survey is to find out and analyze

the proper profile that can be recruited by company as a channel partner. Company has

been focusing on some of the profile that can be very beneficial for the company. For

example Chartered Accountants, Tax Consultants, Postal agents, Bank’s Daily Collection

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Agents etc. the main idea behind targeting the above profile is strong client network

which is really very important for an insurance company.

OBJECTIVE OF THE STUDY

To know the mental perception of people. So that we can judge how much

opportunities company have to develop the insurance sector in rural areas.

To create awareness among people about insurance, how to take benefit of

insurance.

To start different plans & adopt various strategies regarding the insurance in

the rural areas.

To know about brand awareness of Bajaj Allianz Life Insurance and cus-

tomer’s preference about Bajaj Allianz Life Insurance.

[8]


CONTENTS

Preface …………………………………………………………………1

Acknowledgement …………………………………………………………..2

Executive Summary ……………………………………………………………… 3-4

Objective of the Study ……………………………………………………………..5

CHEPTER 1-Introduction to insurance ……………………………. 8-22

The nature of insurance

Life insurance business definition

Role of insurance in the growth of economy

History of insurance

Kinds of life insurance

Key features of life insurance

Benefits of life insurance

Liberalization

Nationalization of life insurance in India

Potential insurance in India

Chapter 2- company profile ………………………………………23-26

Board of directors

Bajaj Allianz life insurance company ltd

Bajaj Allianz general insurance company ltd

Chapter 3-products of the company ………………………………27-51

[9]


Unit linked

Woman insurance

Pension

Traditional

Term plans

Health

Child gain

Just launched

Chapter 4- research methodology …………………………………52-54

Research process

Sample techniques

Method of data collection

Data analysis …………………………………………………………………...55-73

Findings ………………………………………………………………….74

Suggestions and recommendations ……………………………………………75

Limitation ……………………………………………………………………….76

Conclusion ………………………………………………………………………77-79

Questionnaire ……………………………………………………………………80-81

Bibliography ……………………………………………………………………..82

[10]


CHEPTER 1- Introduction to insurance

People in all walks of life are exposed to risk and uncertainty. An untimely death,

loss of goods due to theft and natural calamities like floods, earthquake are some

examples of the risk that everybody on earth faces. As days progress, man is becoming

exposed to more and more dangers both natural and man-made. Insurance is the universal

panacea that offers to provide against such risk and uncertainty. Insurance does not

profess to eliminate loss but it compensates, to some extent, the loss, which arises from

uncertain events.

The Nature of Insurance

Insurance is essentially a co-operative endeavor. Under any insurance

arrangement, basically, a large number of persons, in effect, agree to share a loss, which a

few of them are likely to incur in future. Such sharing has the advantage that the in the

individual share of loss is relatively small. When the sharing is done amongst a large

number of persons, the individual share remains fairly steady from year to year. Such

association of persons for sharing anticipated losses may be brought about voluntarily by

all participants or may be organized by a few individuals or by an insurance organization.

The function of insurance in its various forms is to protect the few against the heavy

financial impact of anticipated misfortune by spreading the loss among many who are

exposed to the risk of similar nature. While it is not possible to predict which individuals

among the many participants are likely to be the victims of misfortune, it is often possible

to forecast the quantum of the loss, which the group as a whole may suffer. The sharing

of such loss among the participants ensures that the victims are compensated for the loss

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suffered by them. As a consequence, the heavy and uncertain loss to some is neutralized

by the definite contribution of moderate amounts, which every participant is required to

make.

Life Insurance Business-definition

Life insurance is the business of effecting contracts of insurance upon human life,

including any contract whereby the payment of money is assured on death (except death

by accident only) or the happening of any contingency dependent on human life and any

contract which is subject to the payment of premiums for a term dependent on human life

and shall be deemed to include.

a) The granting of disability and double or triple indemnity accident benefits,

if so provided in the contract of insurance.

b) The granting of annuities on human life, and

c) The granting of superannuating allowance and annuities payable out of

any fund applicable solely to the relief and maintenance of persons

engaged or who have been engaged in any particular profession, trade or

employment or of the dependents of such persons.

ROLE OF LIFE INSURANCE IN THE GROWTH OF THE ECONOMY

The Life Insurance Industry has an enviable track record among public sector

units. It has a Consistent profit and dividend paying record accompanied by a steady

growth in its financial resources. Through investments in the Government sector and

socially- oriented sectors the

[12]


Industry has contributed immensely to the nation's development. The industry is

recognized as one of the largest financial Institutions in the country. The ventures

initiated by the industry in the areas of Mutual Fund, Housing Finance have done

exceedingly well in recent years. To protect the country's foreign exchange reserves,

the reinsurance arrangement are so

organized that maximum retention is made possible within the country while at the

same time protecting interests of the policy holders.

SECTION 45 OF THE INSURANCE ACT, 1938

“No policy of life insurance effected after the coming into force of this Act shall, after the

expiry of two years from the date on which it was effected, be called in question by an

insurer on the ground that a statement made in the proposal for insurance or in any report

of a medical officer, or referee, or friend of the insured, or in any other document leading

to the issue of the policy, was inaccurate or false, unless the insurer shows that such a

statement was on a material matter or suppressed facts which it was material to disclose

and that it was fraudulently made by the policyholder and that the policyholder knew at

that time of making it that the statement was false or that it suppressed facts which it was

material to disclose.”

HISTORY OF INSURANCE

The insurance sector in India dates back to 1818, when Oriental Life Insurance

Company was incorporated at Calcutta. Thereafter, few other companies like Bombay

Life Assurance Company, in 1823 and Tritron Insurance Company, for General

Insurance, in 1850 were incorporated. Insurance Act was passed in 1928 but it was

subsequently reviewed and comprehensive legislation was enacted in 1938. The

nationalization of life insurance business took place in 1956 when 245 Indian and

Foreign Insurance provident societies were first merged and then nationalized. It paved

[13]


the way towards the establishment of Life Insurance Corporation (LIC) and since then it

enjoyed a monopoly over the life insurance business in India. General Insurance followed

suit and in 1968, the insurance act was amended to allow for social control over the

general insurance business. Subsequently in 1973, non-life insurance business was

nationalized and the General Insurance Business (Nationalization) Act, 1972 was

promulgated. The General Insurance Corporation (GIC) in its present form was

incorporated in 1972 and maintained a very strong hold over the non-life insurance

business in India. Due to concerns of

Relatively low spread of insurance in the country.

1. The efficient and quality functioning of the Public Sector insurance companies.

2. The untapped potential for mobilizing long-term contractual savings funds for

infrastructure.

The (Congress) government set up an Insurance Reforms committee in April 1993.

The Committee submitted its report in January 1994, recommended a phased program of

liberalization, and called for private sector entry and restructuring of the LIC and GIC.

The United Front government moved an insurance bill but it did not pass. The BJP

government moved an insurance bill again in 1998, which had also to be referred back to

a select committee of parliament. But now the parliament has given a nod to the

Insurance Regulatory and Development Authority (IRDA) bill with some changes in the

original structure.

KINDS OF LIFE INSURANCE POLICIES

[14]


Temporary Term Insurance

Term assurance: provides for life insurance coverage for a specified term of years

for a specified premium. The policy does not accumulate cash value. Term is generally

considered "pure" insurance, where the premium buys protection in the event of death

and nothing else.

There are three key factors to be considered in term insurance:

1. Face amount (protection or death benefit),

2. Premium to be paid (cost to the insured), and

3. Length of coverage (term).

Various insurance companies sell term insurance with many different combinations of

these three parameters. The face amount can remain constant or decline. The term can be

for one or more years. The premium can remain level or increase. A common type of

term is called annual renewable term. It is a one year policy but the insurance company

guarantees it will issue a policy of equal or lesser amount without regard to the

insurability of the insured and with a premium set for the insured's age at that time.

Another common type of term insurance is mortgage insurance, which is usually a level

premium, declining face value policy. The face amount is intended to equal the amount of

the mortgage on the policy owner’s residence so the mortgage will be paid if the insured

dies.

A policy holder insures his life for a specified term. If he dies before that specified

term is up, his estate or named beneficiary receives a payout. If he does not die before the

term is up, he receives nothing. In the past these policies would almost always exclude

suicide. However, after a number of court judgments against the industry, payouts do

occur on death by suicide (presumably except for in the unlikely case that it can be shown

that the suicide was just to benefit from the policy). Generally, if an insured person

commits suicide within the first two policy years, the insurer will return the premiums

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paid. However, a death benefit will usually be paid if the suicide occurs after the two year

period.

Permanent Life Insurance

Permanent life insurance is life insurance that remains in force (in-line) until the

policy matures (pays out), unless the owner fails to pay the premium when due (the

policy expires OR policies lapse). The policy cannot be canceled by the insurer for any

reason except fraud in the application, and that cancellation must occur within a period of

time defined by law (usually two years). Permanent insurance builds a cash value that

reduces the amount at risk to the insurance company and thus the insurance expense over

time. This means that a policy with a million dollar face value can be relatively expensive

to a 70 year old. The owner can access the money in the cash value by withdrawing

money, borrowing the cash value, or surrendering the policy and receiving the surrender

value.

The four basic types of permanent insurance are whole life, universal life, limited pay

and endowment.

Whole life coverage

Whole life insurance provides for a level premium, and a cash value table

included in the policy guaranteed by the company. The primary advantages of whole life

are guaranteed death benefits; guaranteed cash values, fixed and known annual

premiums, and mortality and expense charges will not reduce the cash value shown in the

policy. The primary disadvantages of whole life are premium inflexibility, and the

internal rate of return in the policy may not be competitive with other savings

alternatives. Also, the cash values are generally kept by the insurance company at the

time of death, the death benefit only to the beneficiaries. Riders are available that can

allow one to increase the death benefit by paying additional premium. The death benefit

can also be increased through the use of policy dividends. Dividends cannot be

guaranteed and may be higher or lower than historical rates over time. Premiums are

[16]


much higher than term insurance in the short-term, but cumulative premiums are roughly

equal if policies are kept in force until average life expectancy.

Cash value can be accessed at any time through policy "loans". Since these loans

decrease the death benefit if not paid back, payback is optional. Cash values are not paid

to the beneficiary upon the death of the insured; the beneficiary receives the death benefit

only. If the dividend option: Paid up additions is elected, dividend cash values will

purchase additional death benefit which will increase the death benefit of the policy to the

named beneficiary.

Universal life coverage

A universal life insurance policy includes a cash account. Premiums increase the

cash account. Interest is paid within the policy (credited) on the account at a rate

specified by the company. Mortality charges and administrative costs are then charged

against (reduce) the cash account. The surrender value of the policy is the amount

remaining in the cash account less applicable surrender charges, if any.

With all life insurance, there are basically two functions that make it work.

There's a mortality function and a cash function. The mortality function would be the

classical notion of pooling risk where the premiums paid by everybody else would cover

the death benefit for the one or two who will die for a given period of time. The cash

function inherent in all life insurance says that if a person is to reach age 95 to 100 (the

age varies depending on state and company), then the policy matures and endows the face

value of the policy.

Actuarially, it is reasoned that out of a group of 1000 people, if even 10 of them

live to age 95, then the mortality function alone will not be able to cover the cash

function. So in order to cover the cash function, a minimum rate of investment return on

the premiums will be required in the event that a policy matures.

Universal life insurance addresses the perceived disadvantages of whole life.

Premiums are flexible. Depending on how interest is credited, the internal rate of return

[17]


can be higher because it moves with prevailing interest rates (interest-sensitive) or the

financial markets (Equity Indexed Universal Life and Variable Universal Life). Mortality

costs and administrative charges are known. And cash value may be considered more

easily attainable because the owner can discontinue premiums if the cash value allows it.

And universal life has a more flexible death benefit because the owner can select one of

two death benefit options, Option A and Option B.

Option A pays the face amount at death as it's designed to have the cash value equal the

death benefit at maturity (usually at age 95 or 100). With each premium payment, the

policy owner is reducing the cost of insurance until the cash value reaches the face

amount upon maturity.

Option B pays the face amount plus the cash value, as it's designed to increase the

net death benefit as cash values accumulate. Option B offers the benefit of an increasing

death benefit every year that the policy stays in force. The drawback to option B is that

because the cash value is accumulated "on top of" the death benefit, the cost of insurance

never decreases as premium payments are made. Thus, as the insured gets older, the

policy owner is faced with an ever increasing cost of insurance (it costs more money to

provide the same initial face amount of insurance as the insured gets older)

Limited-pay

Another type of permanent insurance is Limited-pay life insurance, in which all

the premiums are paid over a specified period after which no additional premiums are due

to keep the policy in force. Common limited pay periods include 10-year, 20-year, and

paid-up at age 65.

In the United States, the Technical Correct Limited-pay

Another type of permanent insurance is Limited-pay life insurance, in which all

the premiums are paid over a specified period after which no additional premiums are due

to keep the policy in force. Common limited pay periods include 10-year, 20-year, and

paid-up at age 65.

[18]


Endowments

Endowments are policies in which the cash value built up inside the policy, equals

the death benefit (face amount) at a certain age. The age this commences is known as the

endowment age. Endowments are considerably more expensive (in terms of annual

premiums) than either whole life or universal life because the premium paying period is

shortened and the endowment date is earlier.

In the United States, the Technical Corrections Act of 1988 tightened the rules on

tax shelters (creating modified endowments). These follow tax rules as annuities and

IRAs do.

Endowment Insurance is paid out whether the insured lives or dies, after a specific

period (e.g. 15 years) or a specific age (e.g. 65).

Accidental Death

Accidental death is a limited life insurance that is designed to cover the insured

when they pass away due to an accident. Accidents include anything from an injury, but

do not typically cover any deaths resulting from health problems or suicide. Because they

only cover accidents, these policies are much less expensive than other life insurances.

It is also very commonly offered as "accidental death and dismemberment

insurance", also known as an AD&D policy. In an AD&D policy, benefits are available

not only for accidental death, but also for loss of limbs or bodily functions such as sight

and hearing, etc.

Accidental death and AD&D policies very rarely pay a benefit; either the cause of

death is not covered, or the coverage is not maintained after the accident until death

occurs. To be aware of what coverage they have, an insured should always review their

policy for what it covers and what it excludes. Often, it does not cover an insured that

puts himself at risk in activities such as: parachuting, flying an airplane, professional

sports, or involvement in a war (military or not). Also, some insurers will exclude death

[19]


and injury caused by proximate causes due to (but not limited to) racing on wheels and

mountaineering.

Accidental death benefits can also be added to a standard life insurance policy as

a rider. If this rider is purchased, the policy will generally pay double the face amount if

the insured dies due to an accident. This used to be commonly referred to as double

indemnity coverage. In some cases, some companies may even offer a triple indemnity

cover.

KEY FEATURES OF LIFE INSURANCE

1) Nomination: -

When one makes a nomination, as the policyholder, one continues to be the owner

of the policy and the nominee does not have any right under the policy as long as he/she

is alive. The nominee has only the right to receive the policy money in case of your death

within the term of the policy.

2) Assignment: -

If your intention is that your policy monies should go only to a particular person,

you need to assign the policy in favor of that person.

3) Death Benefit: -

The primary feature of a life insurance policy is the death benefit it provides.

Permanent policies provide a death benefit that is guaranteed for the life of the insured,

provided the premiums have been paid and the policy has not been surrendered.

4) Cash Value: -

The cash value of a permanent life insurance policy is accumulated throughout the

term of the policy. It equals the amount a policy owner would receive, after any

applicable surrender charges, if the policy were surrendered before the insured's death.

5) Dividends: -

Many life insurance companies issue life insurance policies that entitle the policy

owner to share in the company's divisible surplus.

6) Paid-Up Additions: -

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Dividends paid to a policy owner of a participating policy can be used in

numerous ways, one of which is toward the purchase of additional coverage, called paid-

up additions.

7) Policy Loans: -

Some life insurance policies allow a policy owner to apply for a loan against the

value of their policy. Either a fixed or variable rate of interest is charged. This feature

allows the policy owner an easily accessible loan in times of need or opportunity.

8) Conversion from Term to Permanent: -

When in need of temporary protection, individuals often purchase term life

insurance. If one owns a term policy, sometimes a provision is available that will allow

her to convert her policy to a permanent one without providing additional proof of

insurability.

9) Disability Waiver of Premium: -

Waiver of Premium is an option or benefit that can be attached to a life insurance

policy at an additional cost. It guarantees that coverage will stay in force and continue to

grow

BENEFITS OF LIFE INSURANCE

1) Risk cover: -

Life Insurance contracts allow an individual to have a risk cover against any

unfortunate event of the future.

2) Tax Deduction: -

Under section 80C of the Income Tax Act of 1961 one can get tax deduction on

premiums up to one lakh rupees. Life Insurance policies thus decrease the total taxable

income of an individual.

3) Loans: -

[21]


An individual can easily access loans from different financial institutions by

pledging his insurance policies.

4) Retirement Planning: -

What had provided protection against the financial consequences of premature

death may now be used to help them enjoy their retirement years. Moreover the cash

value can be used as an additional income in the old age.

5) Educational Needs: -

Similar to retirement planning the cash values that flow from ones life Insurance

schemes can be utilized for educational needs of the insurer or his Children.

LIBRALISATION

The decision to allow private companies to sell insurance products in India rests

with Indian Parliament. Opening up the insurance sector required crossing at least two

legislative hurdles. These were the passage of the insurance Regulatory authority (IRA)

bill, which would make IRA a statutory regulatory body and the amendment of the LIC

and GIC Acts, which would end their respective monopolies.

Subsequently in pursuance to the announcement made by the Union Finance

Minister in his budget speech of 1998-99. The Insurance Regulatory and Development

Regulatory Bill, 1999, were passed by both houses of Parliament. The Bill was assented

to by the president and notified on December 29, 1999. With the Insurance Regulatory

and Development Authority Act, 1999 coming into force the insurance industry has been

opened up for the private sector.

The Act provides for the establishment of a statutory IRDA to protect the interest

of insurance policy holders and to regulate, promote and ensure orderly growth of

insurance industry. The

IRDA was formed by an act of the Parliament on April 19, 2000. The IRDA Act also

seeks to amend the Life Insurance Act, 1956, the General Insurance Business

(Nationalization) Act, 1972, and the consequential provisions of the Insurance Act, 1938

with a view to seizing the exclusive privilege of LIC and GIC in the life and non-life

businesses respectively.

[22]


Under the IRDA Act, an “Indian insurance company” will be allowed to conduct

insurance business provided it satisfies the following conditions:

It must be formed and registered under the Companies Act, 1956; the aggregate holdings

of equity shares by a foreign company, either by itself or through its subsidiary

companies, should not exceed 26% paid up equity share capital of an insurance company.

Its sole purpose must be to carry on life insurance business or general insurance

business or reinsurance business. It has also been provided in the IRDA Act that on or

after the commencement of the act no insurer will be allowed to carry on life insurance

and general insurance business in India unless it has a paid up equity capital of rupees 1

billion. For carrying on the reinsurance business, the minimum paid up equity capital has

been prescribed as Rs. 2 billion. The Reserve Bank of India (RBI) has also issued

guidelines for banks entry into the insurance business.

Following the passage of the IRDA Act, by March 2001, thirteen new life insurers

have received license from IRDA. Although Private insurance companies have

commenced operations, the nationalized insurance companies are expected to dominate

the market in the near future.

The limiting factor for prospective private insurers will be the extensive and

costly distribution structure required. The new entrants can not expect to duplicate the

extensive distribution network of the nationalized insurance companies. Building a

distribution network is expensive and time consuming.

Policies that provide a money-back policy after reduced durations: 5 or 10 years. Funds

from this payout may be expended or reinvested in other saving programs or in other life

insurance plans.

Spread of financial services in rural areas and amongst socially underprivileged

[23]


• IRDA Regulations provide certain minimum business to be done

(i) In rural areas

(ii) In the socially weaker sections

• Life Insurance offices are spread over nearly 1400 centers.

• Presence of representative in every tensile – deeper penetration in rural areas.

• Insurance agents numbering over 6.24 lakhs in rural areas.

• Policies sold in rural areas (2007-08) - No. of policies - 60lakhs Sum assured 56,000 cr

• Social security - No. of lives covered 2006-07 17.4 lakhs 2004-05 42.1lakhs

NATIONALISATION OF LIFE INSURANCE IN INDIA

On 19th January, 1956, the Indian Government issued an emergency ordinance,

whose objective was to nationalize life insurance. As a result of this ordinance, the

business of life insurance which was in the hands of private sector organizations at that

time now came in the hands of the Government of India.

At the time of nationalization, in our country 154 Indian Insurance companies, 16

foreign insurance companies and 75 private insurance societies were working in the

Insurance business.

In June 1956, an Act by the name of Life Insurance Corporation Act, 1956 was

passed in the Parliament, which came into force from 1st July 1956 in India. As a result of

this Act, a Government organization was established which is known as ‘Life Insurance

Corporation of India’. The Life Insurance Corporation started the insurance business

from 1st September, 1956.

[24]


REASONS OR OBJECTIVES OF NATIONALISATION

1) To arrange funds for Five Year Plans of the Government of India.

2) To widely propagate Life Insurance even in villages and small towns.

3) To eliminate unhealthy competition among Private Insurance Companies.

4) To end mismanagement, spread in Private Insurance Companies.

5) To increase the per person insured amount.

6) To establish a socialist society, to give maximum benefits to the society.

7) To reduce the wasteful administrative expenses of the Private Insurance

Companies.

8) To secure the interests of small insured persons.

9) To create a sense of saving among people.

10) To utilize the ‘Life Insurance Fund’ properly.

11) To end the delays in payments on maturity to insured by Private Insurance

Companies.

12) To decentralize economic and financial power from the hands of Private

Insurance Companies.

Potential in the insurance

Scope of insurance business in India

The Malhotra Committee estimated that the insurance penetration in India is to

the extent of about 25% of the insurable population. As of 1999-2000, LIC’s insurance

Premium Income was approximately Rs. 32,000 crore. It is observed that currently LIC

has about 10 crore policies in force, which contribute a Premium of about 6% of the GDS

(Gross Domestic Savings ) of households in India.

Based on a report by the confederation of India industries (Cll), it is anticipated

that this figure of 10 crore policies in force is likely to double in the next decade. By the

year 2010, the premium income is expected to account for 18% of the GDS, amounting to

Rs. 512,000 crore

[25]


CHEPTER2- COMPANY PROFILE

[26]


Bajaj Auto Limited

Type- public

Founded- 1945

Headquarters- Pune, India

Key people- Rahul Bajaj (chairman)

Rajiv Bajaj (Managing Director)

Revenue - ▲ Rs. 81.063 billion (2005)

or USD 1.32 billion

Net income - ▲ Rs. 11.016 billion

Employees - 10,250 (2006-07)

Website - www.bajajauto.com

Allianz SE

Type - Public (FWB: ALV, NYSE: AZ)

Founded - 1890

Key people - Michael Diekmann (CEO),

Henning Schulte-Noelle (Chairman of the

supervisory Board) Helmut Perlet (CFO),

Paul Achleitner (CIO)

Industry - Financial services

Products - Insurance, banking, asset

management

Revenue - €92.55 billion (2008)[1]

Operating income - ▲ €7.433 billion (2008)[1]

Profit - ▼ (€2.444 billion) (2008)[1]

Total assets - €955.6 billion (2008)[1]

Employees - 182,860 (2008)[1]

BOARD OF DIRECTORS:

[27]


Mr. Rahul Bajaj (Chairman)

Dr. Werner Zedelius

Mr. Sanjay Asher

Mr. Niraj Bajaj

Mr. Sanjiv Bajaj

Mr. Heinz Dollberg

Mr. Ranjit Gupta

Mr. S. H. Khan

Mr. Suraj Mehta

Mr. Dietmar Raich

Mr. Manu Tandon

Mr. Kamesh Goyal (Alternate Director to Dr. Werner Zedelius)

AUDITORS :

B S R & Co.

Chartered Accountants

DALAL & SHAH

Chartered Accountants

MAIN BANKERS :

Standard Chartered Bank

Syndicate Bank

AXIS Bank

Deutsche Bank

HDFC Bank

ALLIANZ SE (Society Europa) JOINED FORCES WITH BAJAJ Auto Ltd. to

offer both general and life insurance products. Allianz’s joint venture partner is Bajaj

Auto, a respected Indian conglomerate with a strong market presence and an excellent

[28]


distribution network. Their two joint ventures are Bajaj Allianz for General Insurance and

Bajaj Allianz for Life Insurance.

Bajaj Auto Ltd. foundedin 1942 by (Late) Shri Jamnalal Bajaj (Freedom Fighter

& Follower of Mahatma Gandhi), is India’s largest two & three-wheeler manufacturer &

Exporter producing 1.2 million units, with Market Capitalization of Rs. 8000 Crore. Bajaj

Auto has an existing network of over 375 dealers across India & a Distributor network in

60 cities.

Allianz SE is a Leading Global Insurance company Headquartered in Munch,

Germany, established in 1890, with a Global network extends to over 73 countries across

Europe, South 7 Northern America, Africa & Middle East, Asia pacific, with over 700

subsidiaries & 119,000 employees Worldwide. At current level company has assets under

management of USD 1000 billion, with global ratings-“AA+” given by Standard &

Poor’s (S&P).

Allianz’ links with India started in the 1920s. Allianz first arrived in India in

1928 when it opened a branch in Delhi. In September 2001, Bajaj Allianz received the

license from the IRDA to start selling life products.

Bajaj Allianz Life Insurance Company Limited takes this opportunity to

welcome you our commitment to meet the needs of customer through quality products,

dependable service and ethical business standards. Trusted over decades, both Allianz SE

and Bajaj Auto have experienced substantial growth in demanding environment.

BAJAJ ALLIANZ LIFE INSURANCE

[29]


Bajaj Allianz Life Insurance Company Limited

Bajaj Allianz Life Insurance Co. Ltd. is a joint venture between two leading

conglomerates- , Bajaj Auto, one of the biggest 2 and 3 wheeler manufacturers in the

world and Allianz AG, one of the world's largest insurance companies.

Bajaj Allianz Life Insurance

Is the fastest growing private life insurance company in India.

Currently has over 3,00,000 satisfied customers

We have customer care centers in 155 cities with 28000 Insurance

Consultant providing the finest customer service.

One of India's leading private life insurance companies

Bajaj Allianz General Insurance Company Limited

Bajaj Allianz General Insurance Company Limited is a joint venture between

Bajaj Auto Limited and Allianz AG of Germany. Both enjoy a reputation of expertise,

stability and strength. Bajaj Allianz General Insurance received the Insurance Regulatory

and Development Authority (IRDA) certificate of Registration (R3) on May 2nd, 2001 to

conduct General Insurance business (including Health Insurance business) in India. The

Company has an authorized and paid up capital of Rs 110 crores. Bajaj Auto holds 74%

and the remaining 26% is held by Allianz, AG, Germany.

Bajaj Allianz today has a network of 42 offices spread across the length and breadth of

the country. From Surat to Siliguri and Jammu to Thiruvananthapuram, all the offices

are interconnected with the Head Office at Pune.

Chapter- 3 products of the company

[30]


1. UNIT LINKED

Market linked insurance plans invest the premium in to the equity, debt and cash

markets by the way of allocating units, which like any other mutual fund have a NAV

and the customer is free to switch between one fund class to another depending on the

risk factor he wishes to be in. ULIPs offer a better return than the traditional endowment

plans and offer a great deal of flexibility along with great returns making them the finest

product offering. We at Bajaj Allianz Life Insurance have developed a number of ULIP

products which range from single premium to a regular premium option along with

investment funds ranging from index funds to mid-cap funds and debt market linked

funds.

Regular Premium

New UnitGain Super

UnitGain Plus Gold

New UnitGain Plus

New UnitGain

YoungCare

YoungCare Plus

Family Assure

Fortune Plus

New FamilyGain-R

iGain

Single Premium

New UnitGain Premier SP

New UnitGain Plus SP

A. BAJAJ ALLIANZE UNIT GAIN SUPER

[31]


Insure fully and get MAX allocation along with a host of additional benefits to

choose from. A flexible unit linked plan that allows partial & full withdrawal after 3

years

Additional benefits:

UL Accidental Death Benefit and UL Disability Benefit.

UL Critical Illness Benefit and UL Hospital Cash Benefit.

4 funds to choose from & flexibility to pay top-up any time.

B. Bajaj Allianz Unit Gain Plus Gold

A Unique plan with the combination of protection and prospects of earning

attractive returns with investments in various mix of securities that makes a perfect plan

to last you a life time of prosperity and happiness. High Allocation up to 85%.

Guaranteed Life Cover with a choice of 7 Investment Funds.

Additional Benefit Riders

UL Accidental Death Benefit.

UL Critical Illness benefit.

UL Hospital Cash Benefit.

UL Family Income Benefit.

UL Waiver of Premium benefit

C. Bajaj Allianz New Unit Gain Plus

Flexible investment plans with an option of withdrawing money whenever

needed.

Guaranteed life cover.

Choice of 5 investment funds.

3 free switches allowed every year.

Partial and full withdrawals after 3 years.

Unmatched flexibility to meet your changing lifestyle and insurance

requirements.

D. Bajaj Allianz New Unit Gain

[32]


An investment plan that creates value for every rupee you invest.

E. Bajaj Allianz YoungCare

Bajaj Allianz YoungCare offers you a unique way to reassure yourself that you have

taken care of the ones you cherish. This investment plan is a Gift of a lifetime to your

loved one, as it offers a guaranteed Sum Assured and continued pay premium on your

behalf, in case of your unfortunate death.

F. Bajaj Allianz YoungCare Plus

Bajaj Allianz YoungCare Plus offers you a unique way to reassure yourself that

you have taken care of the ones you cherish. This investment plan is a Gift of a

lifetime to your loved one, as it offers a guaranteed Sum Assured, continued pay

premium on your behalf, in case of your unfortunate death and critical illness benefit.

G. Bajaj Allianz Family Assure

Bajaj Allianz Family Assure, you can invest in one life insurance plan that can

take care of all your changing requirements. This plan has been designed to

provide you with maximum flexibility, so that you do not have to worry about

your changing needs.

H. Bajaj Allianz Fortune Plus

With Bajaj Allianz Fortune Plus we have form1 ulated a unique combination

of protection and prospects of attractive returns with investment in various mix of

securities to make a perfect plan to last you a lifetime of prosperity and happiness

I. Bajaj Allianz New Family Gain-R

With Bajaj Allianz New Family Gain, you can invest in one life insurance plan that can

take care of all your changing requirements. This plan has been designed to provide you

with maximum flexibility, so that you do not have to worry about your changing needs.

J. I gain

[33]


Bajaj Allianz I Gain is the first unit linked insurance plan -

ULIP which can only be bought online. Which means you

don't just get insured, your investment also takes part in

market instruments, giving you greater returns as well. Buying

online has a number of advantages which include

convenience, higher allocation and lower changes I Gain is the fastest way to buy life

insurance online. It is India’s 1st completely online ULIP, which can only be bought

online. I Gain give you the convenience and ease to invest online and manage your

investment on line. Premiums paid under I Gain are eligible for tax benefits under Sec

80C also the maturity benefits are tax free under Sec 10(10)D.

Single Premium

Unit Linked Single Premium Plans require the premium to be paid

only once.

New Unit Gain Premier SP

New Unit Gain plus SP

A. Bajaj Allianz New Unit Gain Premier SP

New UnitGain Premier SP is an unique insurance cum investment plan that provides

your investment a zing from the start, by allocating 105% of the single premium paid

from day one, thereby ensuring that you get MORE.

105% allocation.

Guaranteed life cover.

Flexible withdrawal option u/s 10 (10) D.

B. Bajaj Allianz New UnitGain Plus SP

The Only Single premium plan that gives you Maximum Allocation

98% Allocation.

Guaranteed Life Cover.

Choice of 5 Investment funds.

[34]


3 free switches allowed everyear.

Partialand Full withdrawls after 3 years.

Now minimum premium as low as Rs10,000 only.

2. WOMEN INSURANCE

Today’s lady is an inspiration to her family. She takes important decisions in every

household and at work. To cater to women's special needs we offer innovative women

specific plans which provide investment benefits, savings, retirement solutions and

medical insurance? Our special plans help mothers plan for their children's education,

save for the future and take care of all medical emergencies in the family.

Our Regular investment and savings plan, offer:

Investments along with critical illness benefits which provide good returns, long term

saving and protection incase of a medical emergency

Investment plans with accidental coverage

Children’s education planning

Specialized retirement income plans for homemakers to provide a secure and financial

future.

Education Plans for the Confident Girl Child

Is your little girl destined for greatness? Will she grow up to be successful?

Your princess can reach for the stars, but before she dreams you must do. Bajaj Allianz

offers Child Education plans, which help a parent secure education for their child. A

specialized plan known as Bajaj Allianz ChildGain offers a wide array of solutions that

allows you to plan for your daughter’s future, including schooling, higher education and

marriage and also takes care of any uncertainties that may happen along the way

Plans for the Confident Young Lady

As a young, confident woman, you are either studying to make your career or

are earning your own living and are financially independent. We at Bajaj Allianz offer

many products, which help check, plan and keep all your finances in order, as well as

take care of your other needs. Bajaj Allianz UnitGain Plus Gold and Bajaj Allianz

Young Care are two plans that help you enter the Capital Markets with no fear. While

[35]

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http://bajajallianzlife.co.in/admin/brochures/childgain.pdf


our special Motor Insurance Package Policy with unique women-specific services,

makes sure that you can drive around, worry-free.

Plans for the Confident Home Maker

As a home maker of today, you are also the decision maker, unlike before. You

are equally aware of the outside world and are accustomed to being consulted by your

husband on decisions pertaining to finances. You also go out of your way to take care of

your family with your warmth and support in case of any illness and ensure that your

family members are treated with the best medical care. Saluting the confident home

maker of today, Bajaj Allianz offers two plans - Bajaj Allianz InvestGain and Bajaj

Allianz Family CareFirst. Plans with a rider especially developed for today’s woman to

give her that extra bit of confidence.

Plans for the Confident Future Grand Mother

A majority of women consider ‘financial security’ to be one of their top priorities,

yet most women feel they do not have the knowledge to address financial matters. It is

necessary to be financially independent, as it gives you a sense of worth and purpose.

Bajaj Allianz Future Income Generator is one plan which suits all. Irrespective of age

this is one plan which would ensure that you remain financially independent in your

golden years of life.

Miss Confident Plans

Bajaj Allianz Miss Confident Plans

A woman today has many roles to fulfill. To emerge truly confident in each of them

she needs to feel secure and independent in each of them. We at Bajaj Allianz recognize

this need and have designed a bouquet of plans especially for today’s women.

These plans span from childhood to old age, helping a woman realize her dreams and

fulfill her responsibilities right through the journey of life.

3. PENSION

We at Bajaj Allianz Life Insurance offer Retirement

Plans which will make sure that we are there to support you in

[36]

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http://bajajallianzlife.co.in/admin/brochures/Family%20CareFirst.pdf

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every stage of your life and your savings today become your wealth and support

for your future years to come

Annuity

Pension Guarantee

Retirement

Future Income Generator

Swarna Vishranti

New UnitGain Easy Pension Plus RP

New UnitGain Easy Pension Plus SP

Future Secure

A. Annuity

a. Bajaj Allianz Pension Guarantee

A Plan that esnures regular Income after Retirement.. for Life

B. Retirement

a. Bajaj Allianz Future Income Generator

Future Income Generator - Retirement plans We at Bajaj Allianz Life Insurance,

help you maintain your lifestyle even after you retire. Your saving today becomes your

wealth and support to help secure your future. Retirement and Pension plans suit various

needs

An alternative to super-annuation’s and provident fund.

[37]


Employers do not promise a lifetime pension and everyone does not have a

government job. Our flexible retirement plans, help you maintain your lifestyle and create

a monthly income that will last you a lifetime.

Smart saving: When we ask you to save a regular amount, we intend to secure your

future. We at Bajaj Allianz Life Insurance will make sure that you retire you have all the

means to enjoy it.

financial independence from work, so you don’t have to worry about income after you

retire.

Specialized retirement solutions for housewives, so that, they become financially

independent.

Wealth creation, smart savings and peace of mind along with a corpus, which secures

your life, post retirement is what our Future Income Generator - Retirement plans are all

about.

Our Future Income Generator - Retirement plans offer flexibility like never before

An option to avail upto 1/3rd of the Fund Value as tax-free lump sum.

Open market option to purchase an immediate annuity from Bajaj Allianz or any other

life insurer as recognised by IRDA.

b. Bajaj Allianz Swarna Vishranti

A plan that enables you to retire with laughter lines – not worry lines

Option to take a tax-free lump sum upto 33% of Sum Assured +

Accrued Bonuses.

Open Market option: Purchase immediate annuity from Bajaj Allianz Life Insurance

or any other Life Insurance Company.

Additional Benefits:

[38]


Accidental Death Benefit and Disability Benefit.

Critical Illness Benefit and Hospital Cash Benefit.

Family Income Benefit: In case of death or accidental total

permanent disability of insured, all future premiums are

waived and 1% of the sum assured is paid monthly.

Term Cover: Additional life insurance protection at a nominal cost.

c. Bajaj Allianz New UnitGain Easy Pension Plus RP

A Unique unitlinked pension plan without life cover

Choice of 2 investment portfolio strategies to manage your investments better.

Option to take a tax-free lump sum up to 33% of Sum Assured.

Open Market option: Purchase immediate annuity from Bajaj

Allianz Life Insurance or any other life insurer.



d. Bajaj Allianz New UnitGain Easy Pension Plus SP

A Unique unitlinked pension plan without life cover

Available in Single Premium and regular Premium payment mode.

Option to take a tax-free lump sum up to 33% of Sum Assured.

Open Market option: Purchase immediate annuity from Bajaj Allianz Life Insurance

or any other life insurer.



Bajaj Allianz Future Secure

Prepare for the future and secure your happiness

[39]


4. TRADITIONAL

Saving Plans, which offer bonuses, are excellent long term saving instruments

with complete safety. Our products offer additional benefits which include 4 times life

cover at little extra costs, limited premium payment terms and compounded reversionary

bonuses making it a very good long term investment.

A. Endowment

InvestGain

SaveCare Economy SP

Life Time Care

Super Saver

B. Money Back

CashGain

A.Endowment

Saving plan, which offer bonuses, are excellent long

term plan with complete safety. Our products offer additional benefits

which include 4 times life cover at a little extra cost, limited premium

payment terms and compounded reversionary bonuses making it a very good long term

investment.

a. Bajaj Allianz InvestGain

InvestGain is a specially designed plan that offers a unique combination of benefits

that help you develop a sound financial portfolio for your family. 4 Times Life Cover at a

little extra cost. Limited premium payment option available.




[40]

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Family Income Benefit: In case of death or accidental total permanent disability of

insured, all future premiums are waived and 1% of the sum assured is paid monthly.

b. Bajaj Allianz SaveCare Economy SP

A One-time payment Investment plan that provides for savings with

high risk cover for 10 years and also participates in the profits of the

company. It offers you high risk cover with easy liquidity and high returns.

A single premium endowment plan that participates in the profits.

10 year Investment plan.

Benefits payable on maturity.

Loans available

c. Bajaj Allianz Life Time Care

A whole life plan, which provides survival benefits at the age of 80, thereby

making sure you are financially secure at the toime when you need it the most.

Br> Additional Benefits:

Accidental Death Cover and Disability Cover.

Critical Illness Cover and Hospital Cash Cover.

Waiver of Premium Benefit.

d. Bajaj Allianz Super Saver

Bajaj Allianz Super Saver is a regular premium endowment plan, which helps

you save regular amounts for a safer tomorrow. It also provides you with extra benefits of

Guaranteed Additions to your sum assured, at the end of each policy year.

[41]


B. Money Back

Money back plans are Traditional Insurance plans that provide the investor with

returns at regular stages of life.

Bajaj Allianz CashGain

A money back plan which guarantees 125% payout + bonuses Quadruple life

cover. 5 easy payouts which give upto 125% + bonuses.




Family Income Benefit: In case of death or accidental total permanent disability of

insured, all future premiums are waived and 1% of the sum assured is paid monthly.

5. TERM PLANS

The sole objective of Term plans is to serve the protection needs of the

customers and by doing so, safeguard one’s family from the financial implications of

unfortunate circumstances that one cannot foresee. These plans are pure risk cover plans

with or without maturity benefit. These pure risk plans cover your life at a nominal cost

and you may want to take this plan to cover your outstanding debts like a

mortgage, a home loan etc.

Protector

Term Care

New Risk Care

[42]


a. Bajaj Allianz Protector

Make sure your family home remains with your family for life. The loan protector

plan from Bajaj Allianz Life Insurance is a mortgage reducing term assurance plan,

which at low premiums helps you to secure your family against home loan.

It is an economical way to protect the family from the burden of

repayment of the loan in case of death of the loanee.

The Plan offers you the convenience of choosing between two

premium payment options - Regular Premium Payment & Single

Premium Payment.

Joint Life availability - the option to cover the co-applicant of the loan under this plan.

b. Bajaj Allianz Term Care

Term Assurance plan with return of premium. An economic way of providing life

cover, this plan also ensures the return of all premiums at the time of maturity.

A term insurance plan with a difference.

Dual benefit - Life cover + Return of premiums paid on survival at the end of the

term.

Single premium payment option available.

The only pure term plan in the market to provide Hospital Cash

Benefit.

Available as: • Economy • Protect • Health • Total

c. Bajaj Allianz New Risk Care

Term Assurance plan with Regular/Single Premium payment options to secure your life.

Life insurance cover at the lowest posible cost.

Additional Rider Benefits with regular premium plan.

Accidental Death Benefit and Accidental Permanent Total/Partial

Disability Benefit.


[43]


6. HEALTH

At Bajaj Allianz Life Insurance we offer unique hospitalisation-cum-insurance

plan that takes care of your hospitalization bills and also provides crucial financial

support to your dependents in case of your unfortunate death. Our health insurance plans

offer a sound protection to safe guard your family from any medical emergencies and will

make sure that financial problems are least of your worries in trying to get yourself

treated.

We offer cash less Mediclaim facility across 2000 hospitals in over 300 towns and

provide best treatment in the finest hospitals with our health insurance products.

Care First

Health Care

Family CareFirst

a. Bajaj Allianz Care First

A medical insurance plan that allows you to renew the policy after every 3 years

and keeps you covered till the age of 65 years. The premium rate is level and guaranteed

for the length of each policy term of 3 years with extra benefits like day care treatment

and pre and post hospitalization treatment.

Care First, the first comprehensive Health Insurance cover offered in conjunction with

Life Insurance benefit.

Generous hospital cover upto 7Lacs.

Cashless Treatment available across over 2000 leading hospitals in over 200 towns

across India.

Specific Day Care treatments requiring less than 24 hrs. Hospitalization is also

covered under this plan.

[44]





b. Bajaj Allianz Health Care

A 6- in-1 health insurance plan that offers:

Life Cover

Hospital Cash benefit

Surgical benefit

Post Hospitalisation Benefit

Critical Illness Cover

Accidental Permanent Total / Partial Disability (APT/PD) along with a cash less card

facility makes it an excellent product as the benefits under this plan can be taken in

addition to any other health insurance plan

c. Bajaj Allianz Family CareFirst

Bajaj Allianz Family CareFirst presents an innovative yet practical health care

plan for everyone in Your family including children and parents. This unique

hospitalisation plan gives you health cover for your entire family. So no separate

accounts, repetitive paperwork or payment adjustments for each member. Secure Your

entire family in one shot.

7. Bajaj Allianz ChildGain

Funds for critical stages in your childs life like

Graduation

Post Graduation

Marriage.

Start a business

[45]


8. JUST LAUNCHED

We at Bajaj Allianz Life Insurance continuously try to improve our products

and services so that our customers get the best buy. Our recently launched products are

CenturyPlus II

UnitGain Protection Plus

Invest Plus

Group Seva Plan

Smart Investment Plan

Group Secure Life

a. Bajaj Allianz CenturyPlus II

Bajaj Allianz CenturyPlus II offers you a limited premium payment term option and a

unique combination of protection and prospect of attractive returns.

b. Bajaj Allianz UnitGain Protection Plus

With Bajaj Allianz UnitGain Protection Plus we have formulated a unique

combination of protection and prospects of attractive returns with investment in various

mix of assets to make a perfect plan to last you a lifetime prosperity and

happiness

c. Bajaj Allianz Invest Plus

Bajaj Allianz Invest Plus helps you get security while ensuring

peace of mind. The guaranteed investment returns give you a great maturity benefit and

protection to your family. You can also multiply your returns by paying additional

premiums.

[46]








d. Bajaj Allianz Group Seva Plan

Bajaj Allianz Group Seva Plan gives your group members and their families

the complete reassurance of a lasting financial security and peace of mind.

e. Bajaj Allianz Smart Investment Plan

Bajaj Allianz Smart Investment Plan (SIP) gives you a unique combination of protection

and savings.SIP helps you plan for your future savings

f. Bajaj Allianz Group Secure Life

Bajaj Allianz Group Secure Life Provides financial protection to your

Member's family members against loan repayment.

[47]


COMPARISON OF TERM INSURANCE PREMIUMS (Rs./ Year)

[48]


PREMIUM STRUCTURE OF ENDOWMENT PLANS

(RS. /YEAR)

[49]


MINIMUM REQUIRED COMPOUND BONUS RATE (IN %)

WHOLE LIFE INSURANCE PREMIUMS (RS./ YEAR)

[50]


EQUITY SHARE CAPITAL OF LIFE INSURANCE COMPANIES

Name of the insurer 2007-08 2008-09 Foreign

Promoter

Indian

Promoter

Life Insurers

HDFC Standard Life Insurance Co.

Ltd.

255.50 320.00 47.52 272.48

ICICI-Prudential Life Insurance Co.

Ltd.

675.00 925.0 240.50 684.50

Max New York Life Insurance Co.

Ltd.

346.08 466.08 121.18 344.90

Kotak Mahindra Old Mutual Life

Insurance.

151.26 211.76 55.06 26.00

Birla Sun Life Insurance Co. Ltd. 290.00 350.00 91.00 26.00

Metlife India Insurance Co. Ltd. 160.00 235.00 61.10 173.90

TATA-AIG Life Insurance Co. Ltd. 231.00 321.00 83.46 237.54

Bajaj Allianz Life Insurance Co. Ltd. 150.07 150.07 39.02 111.05

[51]


AMP Sanmar 160.00 217.10 56.45 160.65

AVIVA 242.80 319.80 83.15 236.65

Sahara India 157.00 157.00 0.00 157.00

Sub Total 3238.71 4347.81 1053.93 3293.88

Life Insurance Corporation of India 5.00 5.00 5.00

Total (Life) 3243.71 4352.81 1053.93 3298.88

INVESTMENTS OF LIFE INSURERS IN LIFE FUND

( Rs. In Crore)

2009 2008

PUBLIC SECTOR

LIC (A) 361428.87 304436.88

PRIVATE SECTOR

HDFC STD LIFE 480.77 305.43

MNYL 436.37 241.85

ICICIPRU 970.63 658.45

BSLI 170.06 170.06

TATA AIG 392.76 220.65

KOTAK LIFE 200.67 133.43

SBI LIFE 960.89 367.84

BAJAJ ALLIANZ 382.28 221.91

METLIFE 157.18 120.18

[52]


AMP SANMAR 110.71 98.69

ING VYSYA 241.22 75.28

AVIVA 144.95 144.65

SAHARA LIFE 142.48 143.29

TOTAL (B) 4790.98 2872.03

TOTAL (A+B) 366219.85 307308.91

INVESTMENTS OF LIFE INSURERS IN PENSIONS FUNDS

(Rs. In Crore)

2009 2008

PUBLIC SECTOR

LIC (A 11462.03 9244.06

PRIVATE SECTOR


MNYL 14.03 2.11

ICICIPRU 166.64 127.59

BSLI 0.06 0.00

TATA AIG 76.78 39.79

KOTAK LIFE 13.36 7.54

SBI LIFE 78.97 15.41


METLIFE 0.21 0.00 0.21 0.00

AMP SANMAR 50.45 9.83

ING VYSYA 0.00 0.00

[53]



TOTAL (B) 561.75 307.77

TOTAL (A+B) 12033.78 9551.83

INVESTMENTS OF LIFE INSURERS IN GROUP INSURANCE

(Rs. In Crore)

2009 2008

PUBLIC SECTOR

LIC (A) 42639.42 34068.32

PRIVATE SECTOR


MNYL 7.25 1.35

ICICIPRU 0.00 0.00

BSLI 0.00 0.00

TATA AIG 14.70 0.00

KOTAK LIFE 2.05 0.90

SBI LIFE 10.77 2.92


METLIFE 2.52 0.44


ING VYSYA 0.00 0.00

AVIVA 2.85 0.57

SAHARA LIFE 0.02 0.00 0.02 0.00

TOTAL (B) 41.43 7.15

[54]


TOTAL (A+B) 42680.85 34075.47

INVESTMENTS OF LIFE INSURERS IN UNIT LINKED PLANS

(Rs. In Crore)

2009 2008

PUBLIC SECTOR

LIC (A) 2758.67 209.87

PRIVATE SECTOR


MNYL 20.44 0.00

ICICIPRU 2337.16 780.07

BSLI 1125.72 474.62

TATA AIG 80.81 12.75

KOTAK LIFE 308.33 53.54

SBI LIFE 3.54 0.00

BAJAJ ALLIANZ 369.24 28.61 369.24 28.61

METLIFE 1.74 0.00


ING VYSYA 78.61 20.81 78.61 20.81

AVIVA 131.13 47.13


TOTAL (B) 4768.77 1478.43

[55]


TOTAL (A+B) 7527.45 1688.31

CHEPTER-3 RESEARCH METHODOLOGY

Research is defined as a scientific and systematic search for pertinent information

on a specific topic.

Research methodology is a way to systematically solve the research problem. It

has many dimensions and methods, which constitute a part of research methodology.

When we talk of research methodology we not only talk of research methods but also

consider the logic behind these methods we use in the context of our research study. This

we explain by using a particular method or technique.

The knowledge of research methodology provides good training to new research

worker and enables to do better research. The study of the research methodology gives

the student the necessary training in gathering materials and arranging them, participation

in the fieldwork and also training in the techniques for the collection of data to particular

problems. Research methodology helps in the use of questionnaires and controlled

experimentation and in recording evidence and interpreting it.

[56]


RESEARCH PROCESS

The research process consists of series of actions or steps necessary to effectively

carry out research and the desired sequencing of these steps. The research process

consists of following steps

Formulating the problem.

Extensive literature survey.

Developing the hypothesis.

Preparing the research design.

Sample design.

Collecting the data.

Execution of Project.

Analysis of data.

Hypothesis testing.

Generalization and interpretation.

Presentation of result.

STATEMENT OF THE PROBLEM: “To study the awareness of financial planning

among customers in context of investment in traditional market and insurance.”

SAMPLING TECHNIQUE:

I adopted the technique of simple random sampling. The technique was adopted to

minimize the cost of survey, as it is very costly to adopt other techniques of sampling. It

[57]


is a well-known fact that in simple random sampling the probability of sample error is

susceptible.

TYPE OF RESEARCH: Descriptive and conclusion oriented.

Descriptive study is a fact – finding investigation with adequate interpretation. It is the

simplest type of research.

3.2- METHOD OF DATA COLLECTION

Our method for collecting information was an extensive one. We conducted market

surveys and collected information by the use of following sources:

The information has been collected from both primary and secondary sources.

In case of primary sources the information was retrieved directly from the concerned

people and the authorities.

PRIMARY DATA- Primary data may be described as the information which is

collected at the very first time. Sources are;

1. Questionnaire

2. Door to door free financial consultancy services

SECONDAARY DATA- since Secondary data are the information published by others

and companies. They were easily available and not much effort was required in obtaining

that information. Sources are;

1. Magazines

2. News papers

3. Internet

4. Journal and brochures

[58]


We conducted our research mainly with the help of the valuable inputs provided by the

consumers of the products of the private players in the form of Questionnaire drafted by

us.

SAMPLE SIZE- my sample size was during the project 150 respondents. Area which I

had covered near by agra.

Analysis

Respondents having Insurance on the basis of gender

Option Responses in%

Male 70%

Female 30%

70

30

malefemale

[59]


Bar Chart Showing Number of peoples surveyed on the basis of Gender

.

Respondents having insurance on the basis of Marital Status

Options Responses in%

Married 75%

Unmarried 25%

Bar chart showing people having insurance on the basis of Marital Status.

[60]

No. of Peoples

0

10

20

30

40

50

60

70

80

Married

Unmarried


[61]


Literacy Level of the Respondents

Options Responses in %

High school 20%

10+2 40%

Graduate 25%

Post graduate 15%

20%

40%

25%

15%

high school10+2graduatepost graduate

Inference: Above pie chart shows the literacy level of the respondents.

[62]


Options Responses

Known 90%

Unknown 10%

No. of respondents which are aware of life Insurance

90%

10%

knownunknown

Above pai chart showing awareness of people about insurance in rural area

No. of respondents having the life insurance policy

[63]


Options Responses

Have insurance 55%

Don’t have 45%

55%

45%

have insurancedon't have

Source of Income of respondents

[64]


Options Responses

Self employed 38%

Business 30%

Salaried 32%

38%

30%

32%

self employedbusiness salaried

Pie chart showing the Source of Income of respondents

Annual Income of respondents

[65]


Options Responses

0 to 1lac 25%

1lac to 1.5lac 40%

1.5lac to 2.5lac 20%

2.5 and above 15%

no of people0

5

10

15

20

25

30

35

40

0-1lac1-1.5lac1.5-2.5lac2.5and abov

Bar Chart showing the Annual Income of the Respondents

[66]


Type of Plan respondents Prefer

endowment 30%

Money back 28%

Pure risk 27%

Term insurance 15%

Bar Chart Showing the preference of respondents.

[67]

Endowment Moneyback Pure Risk Term Insurance

0

5

10

15

20

25

30

30

2827

15


Investment range of Respondents

Options Responses

0-5000 40%

5000- 15000 25%

15000- 20000 20%

20000 and above 15%

Bar Char showing the Investment range of Respondents

[68]

0-5000 5000- 15000 15000-20000 20000and above0

5

10

15

20

25

30

35

40

40

25

20

15


Respondents preferred Duration of Policy

Option Responses

5 years 15%

5-10 years 35%

10-20 years 42%

20 and above 8%

15

3542

8

5years5-10 years10-20years20 and above

Pai Chart Showing the Respondents preference for policy Duration

[69]


Respondents Expectation from the Insurance Company

Options Responses

security 36%

Good return 28%

Service 22%

flexibility 14%

36

28

22

14

securitygood returnserviceflexibility

Pai Chart showing the preference of respondents

[70]


Additional Benefits respondent prefer from policy

Option Responses

Accidental 20%

Critical illness 48%

Start of life 22%

flexibility 10%

Category 10

10

20

30

40

50

60

accidentalcritcal illnessstart of lifeflexibility

Bar chart showing the benefits prefer by respondents

[71]


Company preference of respondents

Options Responses

HDFC std 14%

LIC 40%

ICICI prudential 18%

Bajaj Allianz 20%

Others 8%

14%

40%

18%

20%8%

HDFCLICICICI PRUDENCIALBAJAJ ALLIANZEOTHER

Pie chart showing the company preference of respondents

[72]


Satisfaction level of respondent with their L.I. Company

0ptions Responses

Satisfied 60%

Unsatisfied 40%

Category 10

10

20

30

40

50

60

satisfiedunsatisfied

Bar chart showing the satisfaction level of respondents.

[73]


The Factors that motivated respondents to prefer Bajaj Allianz

Options Responses

Brand name 15%

Goodwill 25%

Advertisement 40%

Fund performance 20%

15%

25%

40%

20%

Sales

brand namegoodwilladvertisementfund perfomance

pai chart showing the factors.

[74]


Respondents which again prefer to buy Bajaj Allianz products

Option Responses

Prefer 65%

Don’t prefer 35%

preferdon't prefar

pai chart showing the preference of respondents

[75]


Factor which most dissatisfy a respondent from Bajaj Allianz

Options Responses

After sale services 35%

Product diversification 40%

Advertisement 15%

Fund performance 10%

Category 10

5

10

15

20

25

30

35

40

after sale serviceproduct divercificationadvertisementfund performance

Bar Chart showing the factors

[76]


Reason behind not purchasing of a Bajaj Allianz Policy

Option Responses

Trust 15%

Services 30%

Advertisement 40%

Brand name 15%

15%

30%

40%

15%

Sales

trustserviceadvertisementbrand name

pai Chart Showing the factors

[77]


Ranking of service offered by Bajaj Allianz Life Insurance

Option Responses

Excellent 10%

Good 30%

Average 45%

Below average 15%

Category 10

5

10

15

20

25

30

35

40

45

excellentgood averagebelow average

[78]


FINDINGS

As the people think that Health care policy is a tool to protect their family & a tax saving device.

They are aware of the fact & realizing its, importance. The company should try to expand &

build up its infrastructure because there is a large potential for health care policy in India.

1. .Company should come up with its branchs in different cities. With the objective and

goals to meet the demands & expectations of the public. Because the entrance of private

players will increase the competition and it would be a tough task to secure a good

position in market.

2. .As seen from the survey that at present 40% of the customer are having medical

insurance policy out of which 60% of the customer are planning for new investments. So

it can be a good potential for the company and they should make an attempt to trap these

customers. Still literacy level of people is high in different areas.

3. Majority of respondents are willing to avail all the extra benefits with their Haelth care

Policy by paying a nominal fee or charges with their policy premium. Most of

respondents are interested in Critical Illness benefit

4. The investors were interested more in Policies of LIC because it is a Government

body.

[79]


SUGGESTIONS & RECOMMENDATIONS

Through out the project work I have tried to my extent to learn more and more so that I enable myself to deliver the best services from my part. I always focused my services to full satisfaction whether it would for employer or for customer. So during this practical learning process whatever I have realized to improve the division of the company is as follows:

Premium and economical class of services should be launched by the company to

serve the varied nature of customers.

Service cum awareness camps should be run by the company in remote areas.

Distribution channel needs more strength

Tapping the up coming market - Semi Urban Market as there is a lot of

opportunity. Most of the Life Insurance companies are operating in the metros

and big cities as per their present branch office locations. If they have to increase

their market size they have to open more distribution centers at the various rural

and semi-urban markets.

[80]


LIMITATIONS

1. Lack of awareness among people about insurance as a investment product

remained the cause for not getting proper responses from some of the people.

2. Aggressive sales strategy of Private insurance players may cause inconvenience to

some people. Thus they do not furnish correct information in the questionnaire

filled by them

3. The result figure may be biased since the subjects/investors may provide wrong

information.

4. The survey may not give the whole scenario of Indian market.

5. Some subjects/investors were not co–operative on their approach.

[81]


Conclusion

During my course of training, I got to understand about the underwriting

procedures and guidelines of the company. It ahs been found that the organization follow

tough standards and guidelines issued by IRDA from time to time.

It’s been a great learning experience as Underwriting is an important aspect of

the operations performed in an insurance company.

Although company follows various automation techniques for faster processes,

It is recommended that company should opt for innovations in the I.T. sector.

The study also aimed at finding out the market preference and makes a

comparative analysis of the products of various life insurers as compared with those of

Bajaj Allianz.

It was found that most of the people give preference to the products of Life

Insurance Corporation of India. LIC being a government backed undertaking and having

been in operation since a long time, it has gained the faith of people. Though now with

the privatization of the insurance sector the thinking pattern of people is changing day by

day, but we can not expect overnight miracles. People are buying life insurance from

private players because the services provided by them are of a better quality than that of

LIC. A person buys insurance basically for the purpose of risk coverage. If the claims are

not settled in time, it would defeat the whole purpose of insurance.

[82]


Another thing that was found was that there is a slow market shift.

Traditionally, people were taking up endowment and money back plans largely. But

nowadays, products such as pension plans and childcare plans are much in demand. The

pension market is estimated to grow at a fast pace.

It was found that the market awareness of Bajaj Allianz is poor. Among private insurers,

people are more conversant with names such as ICICI and HDFC. They can relate these

to insurance, as they are already into financial services. On the other hand, Bajaj Allianz

is mostly related to Bajaj automobiles.

Bajaj Allianz policies were found to be competitive with those of other insurers.

The premium rates of Bajaj Allianz are quoted to be quite low as compared with those of

other insurers. The Family Income Benefit and Hospital Cash Benefit are unique in their

plans

[83]


QUESTIONAIRE

Name-…………………………………………………………………..

Address-………………………………………………………………...................

………………………………………………………………………...

Qus.1 Marital status?

Married { } unmarried { }

Qus.2 Education qualification:

High school { } 10+2 { }

Graduate { } post graduate { }

Qus .3 Do you aware of LIFE INSURANCE?

YES { } NO { }

Qus.4 Do you have any life insurance ?

Yes { } NO { }

Qus 5 – what is your source of income

Self employed ( ) business ( )

Salaried ( ) other ( )

Qus.6 Your annual income?

0-1lac { } 1lac-1.5 lac { }

1.5lac- 2.5lac { } 2.5 and above { }

Qus.7 Which type of plan would you prefer?

Endowment { } Money Back { }

[84]


Pure Risk { } Term insurance { }

Qus.8 what is the range of investment?

0- 5000 { } 5000-15000 { }

15000-20000 { } 20000 and above { }

Qus.9 what is your preferential time period for the policy?

5 year { } 5-10 year { }

10-20 year { } 20 and above { }

Qus.10 what will you expect form the insurance company?

Security { } Good Retune { }

Service { } Flexibility { }

Qus.11 Which additional benefit would you prefer from the policy?

Accidental { } Critical illness { }

Start of life { } Flexibility { }

Qus.12 which company would you prefer for the insurance policy?

HDFC ( ) LIC ( )

ICICI ( ) Standard life insurance ( )

Bajaj Allianz ( ) Others ( )

Qus.13 Are you satisfied with your life insurance company?

Yes ( ) No ( )

Qus. 14 What factor motivate you to prefer Bajaj Allianz?

Brand Name ( ) Goodwill ( )

Service ( ) Advertisement ( )

[85]


Qus.15 If you already have Bajaj Allianz product ,you will again prefer its

product or not?

Prefer ( ) Not prefer ( )

Qus. 16 Which Factor in Bajaj Allianz mostly dissatisfies you?

After sale service ( ) Product Diversification ( )

Fund performance ( ) Advertisement ( )

Qus.17 What is the reason behind your decision for not purchasing the policy of

Bajaj Allianz?

Trust ( ) Service ( )

Advertisement ( ) Market Report ( )

Qus. 18 What rank would you give to the servicer of Bajaj Allianz Life Insurance?

Below Average ( ) Average ( )

Good ( ) Excellent ( )

Date- signature

[86]


BIBLIOGRAPHY

Books reference -

Kothari C.R, Research Methodology, Vishwa prakashan, New Delhi, Reprinted

Edition, 2004, Page 1-112.

Insurance Principles and Practice- By Noorul Hasan,Ambar Prakashan Kendra,

Edition 2009

Page Numbers- 15, 16, 77

Annual Report of Bajaj Allianz Insurance Co. Ltd. 2008-09

Company journals- star track

Web Address-

www.bajajallianz.co.in

www.en.wikipedia.org

www.google.com

[87]

http://www.google.com/

http://www.en.wikipedia.org/

final report(2)

Documents