insurence project r.p.1

8/6/2019 Insurence Project r.p.1

1/98

Summer training ProjectReport

On

Potential of Life insurance Industry with reference to Bajaj

Allianz

For Submitted for Partial Fulfillment Of

Masters of Business Administration

(MBA -2009-2011)

Under The Guidance of:- Under The Supervisionof:-

Mr.Uttkarsh Shukla Mr.Anuj Kumar

Tiwari

Submitted By:-

ANKIT KUMAR TRIPATHI

Roll No. 0944070005

Naraina Vidya Peeth Management Institute

1


2/98

Panki, Kanpur-208020

Naraina Vidya Peeth Management InstituteGangaganj,Panki, Kanpur-208020

DATE. . . . . . .

To Whom It may Concern

This is to certify that Mr./Ms. ANKIT KUMAR TRIPATHI

student of M.B.A Course (2009-11) at Naraina Vidya Peeth Management

Institute with dual Specialization in Marketing & HR has satisfactorily

completed the summer research project on Potential of Lifeinsurance Industry with Bajaj Allianz. study is done under the

guidance of the undersigned by partil fulfillment for the award of M.B.A .I wish

him /her all the best for bright future ahead.

Suervisor Head of Department Director

2


3/98

Institutes

Certificate

3


4/98

COMPANYSCERTIFICATE

4


5/98

STUDENT DECLARATION

I, Ankit kumar tripathi student of M.B.A at Naraina Vidya Peeth Management Institute,

Kanpur of hereby declare that the Project work entitled Potential of Life insurance

Industry with Reference to Bajaj Allianz. Is Compiled and submitted under the guidance

ofMr. ANUJ KUMAR TIW ARI This is my original work

Whatever information furnished in this project report is true to the best of my

knowledge.

ANKIT KUMAR TRIPATHI

MBA Final Year

Roll No: - 0944070005

5


6/98

ACKNOWLEDGEMENT

I would like to express my Acknowledgement to those people, without whose contribution,

Support and guidance this Report would not have seen the light of the day. Notable among themare Mr. A NU J K UMAR T IWAR I ( SEN IOR S AL ES Man ag er , B AJ AJ

ALLIANZ Life Insurance) who was my Project Guide and who helped me in a lot.

I am also thankful to all other employees ofBAJAJ ALLIANZ who guide me during my

Project work.

I am also thankful and would like to express my Gratitude to the Honorable Mr.Uttkarsh

Shukla and the entire Institute for giving me a Platform to have this wonderful opportunity

and being able to get a glimpse of the Corporate World.

6


7/98

PREFACE

The importance of an academic course would gain advantage and

acceptance of the t rue form only through pract ical exper ience. Hence, i t i s

qui te necessary to put the theor ies into talk. I t i s r igidly accepted that the

t he or y w id en s o ne s t hin ki ng h or iz on s v iz . C on ce pt s o f m ar ke tin g

philosophies, but practice indicates the modern marketing and used in variety

of settings of products.

The summer training programmers are designed to give the manager the

f ut ur e o f t he cor pora te happeni ngs and wor k cul tu re . These r ea l l if e

si tuations are entirely different from the st imulated exercise enacted in anart if icial environment inside the summer training programmers and designed,

so that the manager to tomorrow do not feel i l l case when the t ime comes to

shoulder responsibi l i t ies . Pract ical exposure for the MBA students i s very

necessary because what they s tudy in the c las sroom i s not the r ea li ty .

Si tuat ion in the market i s unknown and very much unpredictable. So the

practical experience is very much necessary this is made possible with the

summer training project in BAJAJ ALLIANZ Life Insurance Co. in marketing

related to search for the Potential Insurance Consultants.

All organizations involve into business with some objective and one of

the object ives i s to endorse product or service which they produce. In my

marketing pro jec t I t ri ed to f id out the potenti a l Insurance Consultants

through ques tionnai re for the BAJAJ ALLIANZ Life Insurance Co. The

product for the insuran ce company is its policies which company sale through

i ts Insurance Consul tants . So i t s quit e c lear tha t there wil l be as many

Insurance Consultants. There will be increased sales.

7


8/98

INDEXINDEX

S.No Topics Page No

From To

Institute Certificate

Company Certificate

Acknowledgement

Preface

1. Introduction

About the topic

Objective of the study

2. Industry Profile 14 - 43

3. Company Profile 44 - 51

4. Marketing analysis of company 52 - 74

5. Data Analysis /method employed 75 - 87

6. Interpretation of Data 88 - 89

7. Findings 90 - 91

8. Conclusion 92 - 93

9. Suggestion 94 - 95

10. Limitation of the study 96 - 97

11. Appendices

Questionnair

Organizational Structure

98

99 - 101

102 - 103

104

12. Bibliography 105 - 107

8


9/98

9


10/98

INTRODUCTION

Insurance provides indemnif ication against loss or l iabi li ty from

specific events and circumstances that may occur or be discovered during a

specific period.

-FASB Statement of f inancial accounting s tandards No.

113, Accounting for r einsurance of Shor t-Dura t ion and Long Dura tion

contracts December 1992.

WHAT IS INSURANCE?

In the Dictionary of Business & Finance insurance is stated to mean

a form of con trac t or agreement under which one par ty agrees in

return for a consideration to pay an agreed amount of money to another

party to make good or loss , damage or injury to something of value to

which the insured has a pecuniary interest as a result of some uncertain

event. I t is a device by which the loss l ikely to be caused by an uncertain

event is spread over a number of persons who are exposed to i t and who

propose to insure themselves against such an event.

Thus , we may def ine insurance as the provis ion, which a prudent man

makes agains t happenings by chance or , inevi table contingencies , loss or

misfortune.

In financial term:

The term insurance may be defined as a social device providing f inancial

compensat ion for the consequences of advers ity , the payment being made

f rom t he accumul at ed con tr ibut ions o f a ll par ti es par ti ci pa ti ng i n t he

arrangement.

10


11/98

In legal sense:

The term insurance may be defined as a contract under which the insurer

( insurance company) in consideration of a sum of money paid (premium) by

the insured (the person whose risk is insured)

Insurance may be defined as a contract whereby one party agrees to

pay another party a sum of money in exchange for some consideration on the

happening of a certain event. I t has been described by Chief Justice Tidal as

a contract in which a sum of money is paid by the assured in consideration of

t he i ns ur er s i ncur ri ng t he r is k o f pay ing a l ar ge r s um upon a g iven

contingency. The person or organization that protects another against r isk isknown as the Insurer while the person who is protected against the r isk is

the Insured . The document contain ing the agreement i s the Insurance

Policy. The amount for which the insurance policy is taken is the Insured

Amount . The consideration, which the insured has to pay to the insurer , is

known as the Premium.

Insurance has come to occupy an important place in the smooth running

of business. It offers the following advantages to business:

Security,

Distribution of risk,

Competitiveness,

Specialization,

Optimum use of available capital,

Capital mobilization,

Promotion of foreign trade,

Loan facility

Social welfare.

11


12/98

TYPES OF INSURANCE:

Re-Insurance :

Re-insurance is a sub-insurance, which the insurer may affect if he thinks

that he has insured a big r i sk and wants his l iabi l i ty to be shared by other

insurers . A contract of reinsurance is a contract of indemni ty jus t as the

original contract of insurance.

Life Insurance :

Life insurance is a contract under which one person, in consideration of a

premium paid ei ther in lump sum or by monthly , quar ter ly , hal f year ly or

yearly payments, the insurer agrees to pay a specif ied sum of amount on the

death of the assured or on the expiry of a certain f ixed period, whichever is

earlier. The rate of premium remains constant. The periodical payments made

by the assured towards the total premium are known as installments. Usually,

nonpayment of premium in any year brings the contract to an end.

12


13/98

OBJECTIVE OF THE STUDY

The main of the present study of is accomplishing the following objective-

Proper understanding and analysis of life insurance industry.

According the market survey come know about how much potential

of insurance market in our city.

And base on analys is of the resul t thus obtained make a repor t on

that research.

To explore the need & benefits of Life insurance.

To explore the customer responses towards Bajaj Allianz products.

To know the market share of Bajaj Allianz in the market.

To discover answer to the question through the application of scientific

procedures.

To study awareness of the Bajaj Allianz life insurance.

To understand the deciding criteria for people insurance sector

To determine the need and purpose of brand loyalty in insurance sector

13


14/98

14


15/98

INDUSTRY PROFILE

INDIAN INSURANCE INDUSTRY:

Insurers:

Insurance indust ry , as on 1.4.2000, comprised mainly two players: the

state insurers:

Life Insurers:

Life Insurance Corporation of India (LIC)

General Insurers:

General Insurance Corporat ion of India (GIC) (with ef fect f rom

Dec2000, a National Reinsured)

GIC had four subsidiary companies, namely (with effect from Dec2000, these

subsidiaries have been de-linked from the parent company and made as independent

insurance companies.

1. The Oriental Insurance Company Limited.

2. The New India Assurance Company Limited.

3. Nat ional Insurance Company Limited.

15


16/98

4. United India Insurance Company Limited.

INSURANCE BUSINESS:-

Insurance business is divided into four classes:

1. Life Insurance,

2. Fire Insurance,

3. Marine Insurance,

4. Miscellaneous Insurance.

Life Insurers transact l i fe insurance business; General Insurers transact

the rest no. composites are permitted as per Law.

LEGISLATION: (as on 1.4.2000)

Insurance is a federal subject in India. The primary legislation that deals

with insurance business in India is:

Insurance Act , 1938, and Insurance Regulatory & Development Author ity

Act, 1999.

INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY:

Composition of Authority under IRDA Act, 1999:

As per t he s ec ti on 4 o f I RDA Act ' 1999, I ns ur ance Regul at or y and

D ev el op me nt A uth or it y ( IR DA , w hi ch w as c on st itu te d b y a n a ct o f

parliament) specify the composition of Auth ority.

The Authority is a ten member team consisting of

(a) A Chairman;

16


17/98

(b) five whole-time members;

(c) four part-time members,

(all appointed by the Government of India)

ENTRY OF PRIVATE PLAYERS IN LIFE INSURANCE MARKETS:

With the opening for private participation in the year 2000, the insurance

landscape changed completely and t i l l date 13 new entrants entered in the

field of l i fe insurance and the latest one being Sahara India Life Insurance

Company Ltd. which commenced its operations from 31, October 2004.

Life Insurer in Public Sector:

Life Insurance Corporation of India (LIC)

Life Insurers in Private Sector:

1. BAJAJ ALLIANZ Life Insurance Life

2 . T ata AI G L if e

3. ICICI Prudential Life Insurance

4. HDFC Standard Li fe

5 . B ir la Sun li fe

6 . SBI Life Insurance

7. Kotak Mahindra Old Mutual Life Insurance

8. Aviva Li fe Insurance

9. Reliance Life Insurance Company Limited - Formerly known as

AMP Sanmar LIC.

10. MetLife India Life Insurance

11. ING Vysya Life Insurance

12. Max NewYork Life Insurance

13. Sahara Life Insurance - Now they are not into business

14. Shriram Life Insurance

17
http://en.wikipedia.org/wiki/Reliance_Life_Insurance_Company_Limitedhttp://en.wikipedia.org/wiki/Reliance_Life_Insurance_Company_Limited


18/98

15. BhartiAXA Life Insurance Co Ltd

A BRIEF HISTORY

The origin of insurance is very old. The time when we were not even born;

was has sought some sort of protection from the unpredictable calamities of

the nature. The basic urge in man to secure himself against any form of r isk

and uncertainty led to the origin of insurance.

The insurance came to India from UK; with the establishment of The

Oriental Insurance Corporation in 1818. the Indian Life Insurance company

act 1912 was t he f ir st s ta tu to ry body t ha t s ta rt ed t o r egul at e t he L if e

Insurance bus iness in India. By 1956 about 154 Indian, 16 foreign and 75

provident f irms were been established in India. Then the central government

took over these companies and as a resul t the LIC was formed. Since then

LIC has worked towards spreading Life Insurance and build ing a wide

n et wo rk a cr oss th e l en gth a nd th e b re ath o f th e c ou nt ry . A ft er t he

liberalization the entrance of foreign players has added to the competi t ion in

the market.

The General Insurance business in India, on the other

hand, can t race i ts roots to the Tri ton Insurance Company Ltd , the f ir st

General Insurance Company established in the year 1850 in Calcutta by the

Bri ti sh . I n 1957 Gener al I ns ur ance Counc il , a w ing o f t he I ns ur ance

Associat ion of India, frames a code of conduct for ensuring fair conduct and

sound business pract ices . In 1972 the General Insurance Business in India

wit h e ff ec t f rom 1 s t J anuary 1973. i t was a ft er t hi s t ha t 107 i ns ur er s

amalgamated and grouped into four companies viz. the Nat ional Insurance

Company Ltd, the New India Assurance Company Ltd, the Oriental Insurance

Company Ltd. GIC incorporated as a company.

18


19/98

INSURANCE SECTOR REFORMS

In 1993, Malhotra Commit tee headed by former Finance Secretary and

RBI Governor was formed to evaluate the Indian indust ry and g ive i ts

r ecommendat ions . The commi tt ee came up wit h t he f ol lowi ng maj or

provisions:-

Pr ivate Companies wi th a minimum paid up capi t a l of Rs . 1 bn

should be allowed to enter the industry.

F or ei gn c om pa nie s m ay b e a ll ow ed t o e nt er t he in du st ry in

collaboration with the domestic companies.

Only one s ta te l evel Life Insurance Company should a llow to

operate in each state.

Reforms were ini ti at ed with the passage of Insurance Regula tory and

Devel opment Aut hori ty ( IRDA) B il l i n 1999. I RDA was s et up a s an

independent regulatory authori ty, which has put in place regulations in l ine

with global norms.

IRDA : The IRDA s ince i t s incorporat ion as a s tatutory body has been

framing regulations and registering the private sector insurance companies.

IRDA being an independent statutory body has put a framework of globally

compatible regulations.

19


20/98

INSURANCE MARKET IN INDIA

By any yards tick, wi th about 200 mill ion middle class households ,

presents a huge untapped potent ial for players in the insurance indust ry .

Saturat ion of markets in many developed economies has made the Indian

market even more attractive for global insurance majors. With the per capital

income in India expected to grow at over 6% for the next 10 years and with

improvement in awareness levels , the demand for insurance is expected to

grow at an at tractive rate in India. An independent consult ing company, the

Monitor Group has estimated that the Life Insurance market will grow.

Winds of change:

Reforms have marked the entry of many of the global insurance majors

into the Indian market in the form of joint ventures with Indian companies.

Some of the keys names are AIG, New York Life, All ianz, Prudent ia l,

Standard Life, Sun Life Canada and Old Mutual . The entry of new players

has rejuvenated the erstwhile monopoly player LIC. Which has responded to

the competi tion in an admirable f ashion by l aunching new products and

improving service standards?

Market Expansion :

There has been an overa ll expans ion in the market. This has been

poss ible due to improved awareness levels thanks to the large number of

advertising campaigns launched by all the players. The scope for expansion is

st i l l unlimited as vir tually al l the players are concentrat ing on large ci t ies

and towns except by LIC to an extent there was no s ignificant at tempt to

tap the rural markets.

20


21/98

New Product Offering :

There has been a plethora of new players, mainly from the stable of their

in ternat ional partner s. Customers have t remendous choice f rom a l arge

variety of product s f rom pure t erm insurance to unit -l inked investment

product s. Customers are of fered unbundled products with a variety of

benefi ts as r iders from which they can choose. More customers are buying

product s and serv ices based on the ir t rue needs and not jus t t rad it ional

money-back policies, which is not considered very appropriate for long-term

protection and savings. However, there are still some key new products yet to

be introduced e.g. health products.

Customer Service :

Not unexpectedly, this was one area that witnessed the most s ignificant

change wit h t he ent ry o f new p laye rs . There i s an a tt empt t o b ri ng i n

international best practices in service and operational eff iciency though use

of lates t technologies . Advice and need based sel l ing is emerging through

much bett er t ra ined sa les force and advi sors . There i s improvement in

response and turnaround t imes in speci f ic areas such as del ivery of f i rs t

pol icy receipt, pol icy document, premium not ice, f inal matur ity payment,

set t lement of claims etc. However , there i s a long way to go and var ious

customer surveys indica te that the s tandards are s ti ll be low customer

expectation levels.

Channels of Distribution :

Til l two years back , the only mode of d is tr ibution of l if e insurance

products was through Agents. While agents continue to be the predominant

distr ibution channel, today a number of innovative al ternative channels are

being offered to customers. Some of them are banc assurance, brokers, the

internet and di rect market ing. Though i t i s too ear ly to predict , the wide

21


22/98

s pr ead o f bank b ranch net work i n I nd ia cou ld l ead t o banc a ss ur ance

emerging as a significant distribution mechanism.

The int roduct ion of pr ivate players in the indust ry has added to the

colors in the dull industry. The init iat ives taken by the private players are

ver y compe ti ti ve and have g iven i mmense compe ti ti on t o t he on t ime

monopoly of the market LIC. Since the advent of the private players in the

market the industry has seen new and innovative steps taken by the players in

t hi s s ec to r. The new p laye rs have i mproved t he s er vi ce qua li ty o f t he

insurance. As a result LIC down the years have seen the declining phase in

i ts career . The market share was distr ibuted among the private players. LIC

market share has decreased from 95% (2008-09) to 82% (2009-10).

The fol lowing companies have the market share of the l if e insurance

industry.

22


23/98

CURRENT SCENARIO OF THEINSURANCE INDUSTRY IN INDIA

I nd ia w it h about 200 mil li on middl e c la ss househo ld s hows a huge

untapped potenti al for p layers in the insurance indus try. Sa tura tion of

markets in many developed economies has made the Indian market even more

attractive for global insurance majors. The insurance sector in India has come

to a position of very high potential and competitiveness in the market.

Innovative products and aggressive distribution have become the say of

the day Indians, have always seen Life Insurance as a tax saving device, are

now suddenly turning to the pr iva te sec tor tha t a re provid ing them newproducts and variety for their choice.

Life Insurance industry is wait ing for a big growth as many Indian and

Foreign companies are wait ing in the l ine for the green signal to start their

operations. The Indian Consumer should be ready now because the market is

going to give them al l ar ray of products , di f ferent in pr ice, features and

benefi ts . How the customer is going to make his choice wil l determine the

future of the industry.

CUSTOMER SERVICE:

Consumers remain the most important centre of the insurance sector .

Aft er t he ent ry o f t he f or ei gn p laye rs t he i ndus tr y i s s ee ing a l ot o f

competi t ion and thus improvement of the customer service in the industry.

Computerizat ion of operat ions and updating of t echnology has become

i mp er at iv e i n th e c urr en t s ce na ri o. F or ei gn p la ye rs a n b rin gin g in

international best practices in service through use of latest technologies. The

one time monopoly of the LIC and its agents are now going through a through

revision and training programs to catch up with the other private players.

23


24/98

DISTRIBUTION CHANNELS:

India but s t i l l the increas ing use of other sources i s imperat ive. I t

therefore makes sense to look at wel l balanced, al ternat ives channels of

distribution.

LIC has al ready wel l es tabl ished and have an extens ive dis t r ibut ion

channel and presence. New players may find it expensive and time consuming

to br ing up a dis t r ibut ion Ti l l date insurance agents s t i l l remain the main

source through which insurance products are sold. The concept is very well

established in the country like channel to have an advantage.

At present the dis t r ibut ion channels that are avai lable in the market

are:

Direct Selling

Corporate Agents

Group Selling

Brokers and Cooperative Societies

To make al l these channels a success the companies have to be very alert

and skillful to know how to use these channels in a proper way.

PRODUCT INNOVATION:

Customers have t remendous choice f rom a large var iety of products

from pure term insurance to unit- l inked investment products. Customers are

offered unbundled products with a variety of benefi ts as r iders from which

they can choose. More customers are buying products and services based on

their t rue needs and not just t radit ional money- back policies, which is not

considered very appropriate for long-term protection and savings.

RURAL MARKETING:

24


25/98

Rural India seems to have an appet i te for mobi le phones , computers ,

and cars and to add to i t we have insurance. In India with the private players

having entered into the insurance indust ry , the expected explos ion in job

opportunities may not actually happen but for them the catchments area is the

Opportunit ies in the rural India. In India the insurance business can be said

to be a marathon, not a sprint. This is because of the nature of the business

be ing long t erm. However i t s eems that they i f not anything , a re only

increas ing thei r spending, though only out of the capi ta l. As insurance

companies go more and more rura l in search of business , there wil l be

opportunities in the rural sector. Already United India The Rural consumer is

now exhibit ing an increasing propensity for Insurance products. A research

conducted exhibited that the rural consumers are wil l ing to dole out anything

between Rs. 3,500 and Rs. 2,900 as premium each year. In the Insurance the

awareness l evel for Life Insurance i s the h ighes t in rura l India, but the

customers are a lso aware about motor , accidents and ca tt le insurance .

According to a study nearly one third said that they had purchased some kind

of insurance with the maximum penetration skewed in favor of life insurance.

The study also pointed out the private companies have huge task to play in

creating awareness and creditability among the rural populace.

INFORMATION TECHNOLOGY AND INSURANCE:

In the insurance industry today, there is a clear trend away from selling

a broad range of products to a large volume of customers in a one- size-fi ts-

all manner. Instead of focusing on their different products lines as silos (i.e.,

l i fe, property and casualty etc) insurers are looking for ways to offer highly

targeted insurance products that are tailored to the individuals cus tomers

with the highes t propensi ty to buy them. Insurance indust ry is a data- r ichindustry, and thus, there is desire need to use the data for trend analysis and

personalization.

With increased competi t ion among insurers, service has become a key

issue. People today dont want to accept the current value proposit ions, they

want personalized interactions and they look for more and more features and

25


26/98

add ones and bet ter service. Today managing the cus tomer intel l igent ly i s

very cri t ical for the insurer especial ly in the very competi t ive environment.

Companies need to apply di f ferent set of rules and t reatment s t rategies to

different customer segments.

MERGERS AND ACQUISTIONS :

This is an era of mergers and acquisi t ions. Private companies including

MNCs are amalgamat ing the world over to ge t more competi t ive edge .

Currently, the general insurance industry has been opened up. The insurers

are doing enough to r a i se the l evel of r i sk awareness or a re they mere ly

content to compete in the markets organized and es tabl ished. The pr ivate

players in the future would have to turn thei r at tent ion to working in the

unorganized and under served markets.

What is l ikely to happen is that the private players would continue to

skim the profi table segments of the already organized business in the urban

areas? The t ime has already come for the government of India to evaluate the

performance of private companies.

However i t is high t ime for the government to realize that importance

of merging the public sector general insurance companies into single enti ty.

The recent scenario cal ls for a bet ter performance f rom par t of each of the

public sector insurance companies against each other. The result what we see

is the undercutt ing to retain or wrest business and quoting an uneconomical

rate of premium. While this allows one of the Public Sectors Company to win

a bus iness form another in th i s manner . The o ther s suf fer a loss and theresultant effect is a cannibalization with a fal l in the average premium of the

public sec tor itself.

The purpose of having four companies a ll subs id iari es of General

Insurance Corporation of India (GIC) National Insurance Company,

New India Assurance Company, Oriental Insurance Company, and The

26


27/98

United India Insurance Company; at the time of nationalization was to have

competition among themselves in service and products at the same price.

View of undeserved competi tion among the publ ic sector companies i s

hamper ing the subsidization of social insurance including the motor third

party liability (TPL).

I t is thus clear that i t is good for the public sector companies to merge

immediately when they are still strong, lest a merger becomes inevitable later

after the independent public sector companies fail one after another.

STRATEGIC ALTERNATIVES :

If one analyses the history of growth of the insurance industry since

reforms, i t i s marked by al l - round growth of al l players . More or less al l

players have aggressively recruited and trained advisors, appointed agents,

l au nc he d n ew p ro du cts , im pr ov ed c us to me r s er vic e s ta nd ard s a nd

revamped/expanded their distr ibution networks. Every player would l ike the

customers to believe that i ts service standards are the best or that i ts agents

are the most informed and ethical . In other words, each company is trying to

be everything to everybody. Some players just ify the above strategy on the

basis that the Indian market is huge and it can accommodate everybody. Still ,

in a market where i t is diff icult to dist inguish oneself sufficiently on service

or any o ther par amet er t o be abl e t o cha rge a p remi um, i t w il l l ead t o

unmitigated price competition to the detriment of all players. In the insurance

industry where large amounts of capital are required, this is risky.

While there is room for a few scale players with a finger in every pie, it is

profitable for the players to focus on different segments to survive.

Variety-based Positioning:

27


28/98

This type of posit ioning is based on variet ies in products and services

rather than customer segments. It is a sensible strategy for those companies

who have dist inctive advantages or s trengths in offering certain products

and services.

In the insurance industry too, it is possible to achieve a unique position by

f ocus ing on cer ta in cat egor y o f p roduct s. Thr ough i ts s uper io r f und

management capabilities, the insurance company can deliver better returns on

it investment-l inked products and thereby for i tself a leadership posit ion in

this segment.

Then there i s the ent i re category of pens ion products , which is widely

touted to have immense growth potent ial in India due to imminent pens ion

reforms. I t i s possible to achieve profi table posi t ioning by focusing and

excelling in only pension products.

Needs based Positioning:

This is the most commonly understood posit ioning and is based

on the di f ferent needs of di f ferent groups of consumers . This can be done

successfully if a company has unique strengths to service a group of customer

needs better than others.

The insurance needs of young family wi th smal l chi ldren wi l l be qui te

di fferent f rom tha t of a f amily in which the income-earner i s c lose to

ret irement. However, in India most of the Life Insurance companies have a

wide variety of products of different customer needs and there is no company

focusing only on a particular customer needs.

Access- based Positioning:

Posit ioning of customers can also be done by the way they are

accessible that is different groups of customers may be accessible in different

ways even though they may have similar needs. Access is typically a function

of customer scale.

28


29/98

There is excellent opportunity in the insurance industry to employ access-

based posit ioning by targeting the rural insurance sector . The rural market

for Life Insurance is very different from the urban market in terms of needs,

income levels , distr ibution, penetrat ion of media and so on. Except for LIC,

no other player has paid any at tention or focus on the rural sector . Contrary

to common percept ion i t i s a big oppor tuni ty as emphasized repeatedly by

such eminent s t rategies l ike C.K.Prahlad. Rural market can be a h ighly

profitable position if one is able to carefully plan.

CHOOSING THE RIGHT STRATEGY:

The right s trategic choice is not a matter of posit ioning choice alone. I t is

the configuration of the entire value chain of the company through a different

set of activi t ies to deliver unique value to consumers. The set of activi t ies

cover a ll ups tream and downst ream activ it ies , f rom the select ion of the

product mix. Some Life Insurance companies focusing on rural markets have

adopted innovative means of distr ibution. Instead of appointing agents as is

done typical ly , they have used Gramsevaks in di f ferent vi l lages across the

country to promote Life Insurance and act as their sales arm.

So we can conclude that , the size of the market has grown and the size of

the insurable population in India is indeed vast and the exist ing players have

managed to cover about one-fourth of it .

The fall ing interest rates , the col lapse of many smal l t ime f inancial

inst i tut ions, the scope for entering related areas l ike banking and pensions in

a bid for synergy and the promise of the e-commerce are some of the other

opportunities knocking at the doors of the insurance majors.A number of web sites are coming up on insurance, a few financial magazines

exclusively devoted to insurance and also a few training inst i tutes being set

up hurriedly.

Life insurance has today become a mainstay of any market economy since

it offers plenty of scope for garnering large sums of money for long periods

29


30/98

of time. A well regulated Life Insurance industry which moves with the times

by offering its customers tailor-made products to satisfy their financial needs

is, therefore, essential if we desire to progress towards a worry-free future.

LIBERALIZATION OF INSURANCE SECTOR

Libera l iza tion commitment of the country to he lp in d i sc ip lining future

economic poli cies wil l inc lude the insurance reforms. When wor ld over

insurance market has been opened up . India cannot r emain in i so la tion

. Hi st or y h as s ho wn th at i t is v er y d if fic ul t to p ro sp er in i so la ti on .

Globalization is the new economic reali ty, which is here to stay heralding a

new era of Insurance in India. With the opening of the insurance indust ry ,India stands to gain with the following major advantages:

Globali za t ion wil l provide opportuni ti es to the customer for the be tt er

production with more reasonable and affordable pricing.

The customer will get quicker services.

It will enhance the saving rate.

Long-term funds for infrastructure development will be available to the

country.

I t wil l secure for India larger inflow of foreign capital need to sustain

our GDP growth.

Advantages of Liberalization:

Opening up will enable the country to save more and invest more for the

development in infrastructure. With new insurance intermediaries and more

distribution channels, the market is bound to develop by leaps and bounds. In

the next f ew year s i t i s es tabl i shed tha t the Indian insurance sec tor wi l l

develop a bet ter unders tanding of consumer requirement leading to more

satisfaction of consumers. The world-class technology will be available in

the market bringing about tremendous improvement in servicing. Choice of

pr ice wi l l be avai lable to the cus tomers . Lead to increase in employment .

30


31/98

Social and rural obligations wil l also be served as IRDA has come out with

c lear r egula t ion in the r egards, which markets the development in thi s

regards, which makes the development in this mandatory. Global competitors

will help in building expertise with their global practice.

Unlike west in India, insurance is sold as the

inst rument of saving . About 18% of the poli cies a re sold as death r isk

consideration. Impression about LIC is that they are not meant for the market

requirements. They are only intended to f ind customers. Insurance awareness

is therefore low .Unti l l inked insurance product are not available insurance

covers are expensive and returns are low. Turn over the agent i s high. The

choice avai lable to the insur ing publ ic i s inadequate in terms of services ,

product s and prices . These are the areas of weakness, which may act as

oppor tuni ti es f or new p laye rs who may wor k t o o ff er pol ic ie s t o t he

cus tomers w it h val ue add it ions a t a compe ti ti ve p remi um wit h much

improved servicing.

MAJOR POLICY CHANGES

Reforms in Insurance Sector :

Insurance sector has been opened up for compet i t ion f rom Indian pr ivate

i ns ur ance compani es w it h t he enact ment o f I ns ur ance Regul at or y and

Development Authority Act,1999 (IRDA Act). As per the provisions of IRDA

Act , 1999, Insurance Regulatory and Development Author ity ( IRDA) was

established on 19 April 2000 to protect the interests of holder of insurance

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

industry. IRDA Act 1999 paved the way for the entry of private players into

the insurance market , which was hi ther to the exclus ive pr ivi lege of publ ic

sector insurance companies/ corporations. Under the new dispensation, Indian

insurance companies in private sector were permitted to operate in India with

the following conditions:

31


32/98

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

aggregate holdings of equi ty shares by a foreign company, ei ther by i t sel f

or through i t s subs idiary companies or i t s nominees , do not exceed 26%,

paid up equity capital of such Indian insurance company; The company's sole

purpose is to carry on l ife insurance business or general insurance business

or r e insurance business ; The minimum paid up equi ty capi ta l for l if e or

general insurance bus iness i s Rs .100 corers ; The minimum paid up equi ty

capital for carrying on reinsurance business has been prescribed as Rs.200

crores.

Protection of the interest of policyholders:

IRDA has the responsibility of protecting the interest of insurance

policyholders. Towards achieving this objective, the Authority has taken the

following steps:

IRDA has not if ied Protect ion of Pol icyholders Interest Regulations

2001 to provide for: policy proposal documents in easily

understandable language; claims procedure in both l ife and non-life;set ting up of gri evance redresses machinery ; speedy se tt lement of

claims; and policyholders' servicing. The Regulation also provides for

payment of interest b y insurers for the delay in se ttlement of claim.

The insurers are required to maintain solvency margins so that they are

in a posi tion to meet the i r obliga tions towards poli cyholders with

regard to payment of claims.

I t i s obl igatory on the part of the insurance companies to disclose

clearly the benefits, terms and conditions under the policy.

The adver t isements i ssued by the insurers should not mislead the

insuring public.

32


33/98

All insurers are required to set up proper grievance redress machinery

in their head office and at their other offices.

The Authori ty takes up with the insurers any complaint received from

the policyholders in connection with services provided by them under

the insurance contract.

PRINCIPLES OF INSURANCE

Losses must be uncertain:

The rate of losses must be relatively predictable: In order to set premiums

(prices) insurers must be able to estimate them accurately. This is done using

the Law of Large Numbers , which s ta tes tha t. The l a rger the number of

homogenous exposures considered, the more closely the losses reported wil l

equal the under ly ing probabi li ty of loss. I f the coverage i s unique, the

insured will pay a correspondingly higher premium.

The Loss must be significant:

The legal principle of De minimizes dictates that tr ivial matters are not

covered. Fur thermore, rat ional insurance uses exis t ing insurance when the

transaction costs dictate that filing a claim is not rational.

The Loss must not be catastrophic:

I f the insurer i s insolvent , i t wi l l be unable to pay the insured. In the

United States, there is a system of Guaranty Funds run at the state level to

reimburse insured people whose insurance companies have become insolvent.

[1] This program i s run by the National Associat ion of Insurance

Commissioners (NAIC).

33


34/98

[2] To avoid catastrophic depletion of their own capital , insurers almost

universal ly purchase reinsurance to protect them agains t excess ively large

accumulations of risk in a single area, and to protect them against large-scale

catastrophes. Addit ionally, speculative risks l ike those incurred through

gambling or through the purchases of company stocks are uninsurable.

LIFE INSURANCE

Life insurance is protection against financial loss resulting from death.

I t is insurance company's promise to pay your beneficiary a specif ic amount

of money when you die in exchange for t imely payment of premiums. Life

insurance i s a cont rac t tha t p ledges payment of an amount to the per sonassured (or his nominee) on the happening of the event insured agains t the

person.

The contract is valid for payment of the insured amount during:

The date of maturity, or

Specified dates at periodic intervals, or

Unfortunate death, if it occurs earlier.

Life insurance is universal ly acknowledged an inst i tut ion, which

el iminates ' r isk ' , Subst i tut ing cer tainty for uncer tainty and comes to the

timely aid of the family in the unfortunate event of death of the breadwinner.

Mostly, life insurance is civilizations partial solution to the problems caused

by death. Life insurance, in short , is concerned with two hazards that s tand

across the life-path of every person:

1. That of dying prematurely leaving a dependent family to fend for itself.

2. That of living till old age without visible means of support.

Why do one need life insurance?

34


35/98

Al though one may not think about i t , the abi li ty to earn income is a

significant asset and l ife insurance helps replace lost income in the event of

your premature death. Here are some reasons people buy life insurance.

The death benefit may be used:

To replace income the family would need to maintain their s tandard

of living after the death of a wage earner.

To pay off a mortgage loan and other personal and business debts

or to create a rent fund.

To create a fund for children's education.

To pay final expenses, such as funeral costs and taxes.

To create a family emergency fund or a fund for a family member

with special needs.

INDIAN INSURANCE INDUSTRY: NEW AVENUES FOR GROWTH:

With an annual growth rate of 15-20% and the larges t number of l i fe

insurance policies in force, the potential of the Indian insurance industry is

huge. Total value of the Indian insurance market (2004-05) i s es t imated at

Rs . 450 b il lion (US$10 b il lion). According to government sources , the

insurance and banking services ' contr ibution to the country 's gross domestic

product (GDP) is 7% out of which the gross premium col lect ion forms a

s ignif icant par t. The funds available wi th the s tate-owned Life Insurance

Corporation (LIC) for investments are 8% of GDP.

Till date, only 20% of the total insurable population of India is covered

under var ious l i fe insurance schemes, the penetrat ion rates of health and

other non-l ife insurances in India is also well below the international level .

These facts indicate the immense growth potential of the insurance sector.

35


36/98

The year 1999 saw a revolution in the Indian insurance sector, as major

structural changes took place with the ending of government monopoly and

the passage of the Insurance Regulatory and Development Authori ty (IRDA)

Bill, lifting all entry restrictions for

private players and allowing foreign players to enter the market with some

limits on direct foreign ownership.

However , the exis t ing rule says that a foreign par tner can hold 26%

equity in an insurance company, a proposal to increase this l imit to 49% is

pending wi th the government . Since opening up of the insurance sector in

1999, foreign inves tments of Rs . 8.7 bi ll ion have poured into the Indian

market and 21 private companies have been granted licenses.

Innovative products, smart marketing, and aggressive distr ibution have

enabled f ledgling private insurance companies to sign up Indian customers

faster than anyone expected. Indians, who had always seen life insurance as a

t ax s av ing dev ice, a re now s uddenl y t ur ni ng t o t he p ri va te s ec to r and

snapping up the new innovative products on offer.

The l ife insurance industry in India grew by an impressive 36%, with

premium income from new business at Rs. 253.43 bil l ion during the f iscal

year 2009-10, braving s t i f f compet i t ion f rom pr ivate insurers . This repor t

"Indian Insurance Industry: New Avenues for Growth 2012", f inds that the

market share of the s ta te behemoth, LIC, has c locked 21 .87% growth in

business at Rs.197.86 bil l ion by sell ing 2.4 bil l ion new policies in 2009-10.

However , this was s t il l not enough to ar res t the fall in i t s market share, as private players grew by 129% to mop up Rs. 55.57 bil l ion in 2009-10 from

Rs. 24.29 billion in 2008-09.

However, the total volume of LIC's business increased in the last fiscal

year (2009-2010) compared to the previous one, i ts market share came down

from 87.04 to 78.07%. The 14 private insurers increased their market share

from about 13% to about 22% in a year's time.

36


37/98


38/98

The potential in the country of 1.1 bil l ion people can be seen from

the fact the ratio of life insurance premiums to GDP -- a common measure for

penetrat ion -- is 4.1 per cent , far lower than developed market levels of 6-9

per c ent.

This wil l change as India sees strongly accelerat ing household income

and a mor e f avor ab le demograph ic p ro fi le ove r t he nex t t wo decades ,

Household disposable income is seen r is ing by 5.3 per cent annually, much

more than the 3.6 per cent annual growth over the pas t two decades . With

increased GDP, growth there wil l be more income for consumers to put into

life insurance.

Research suggests the l ife insurance industry could witness a r ise in

insurance sector premiums to between 5.1 and 6.2 per cent of GDP in 2012

from 4.1 per cent . Demand for pension cover is also seen raising, with 113

mill ion Indians expected to be over 60 by 2016, a f igure seen swell ing to 179

million by 2026.

"There is an untapped opportunity" in pensions where l ife insurance

p layer s have no meaningful presence , Jus t 10 to 11 per cent of India' s

working populat ion is covered by formal old-age social secur i ty schemes.

There are currently close to 30 public and private f irms in India's insurance

market with state-owned Life Insurance Corp of India (LIC) st i l l holding a

stran gle ho ld o f o ve r 7 0 pe r c en t. Bu t p riv ate players ha ve mo ve d

aggressively, chasing for business after being allowed to compete with LIC in

2008. And overseas insurers have raced into the market despite rules limiting

foreign direct investment in domestic insurers to 26 per cent.

The Congress government has been seeking to raise the FDI cap

to 49 percent as part of economic reform but its communist allies

fiercely oppose such a step.

LIFE INSURANCE COMPANIES IN MARKET

38


39/98

LIFE INSURER

Public Sector

Life Insurance Corporation of India

Private Sector

Allianz Bajaj Life Insurance Company Limited

Birla Sun-Life Insurance Company Limited

HDFC Standard Life Insurance Co. Limited

ICICI Prudential Life Insurance Co. Limited

ING Vysya Life Insurance Company Limited

Max New York Life Insurance Co. Limited

MetLife Insurance Company Limited

Om Kotak Mahindra Life Insurance Co. Ltd.

SBI Life Insurance Company Limited

TATA AIG Life Insurance Company Limited

AMP Sanmar Assurance Company Limited

Dabur CGU Life Insurance Co. Pvt. Limited

39


40/98

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

40


41/98

41


42/98

COMPANY PROFILE

ABOUT ALLIANZ

Worlds Largest Insurance co. by revenue Rs55, 00,000 Cr (Euro 96.9 billion).

Worldwide 2nd by Gross Written Premiums Rs4, 77,930 Cr (Euro 89 billion).

3rd largest Assets under Management (AUM) & largest amongst Insurance cos. -

AUM of Rs 95, 94,200 Cr (Euro 1078 billion).

11th largest corporation in the world.

50%ofglobalbusinessfromLifeInsurance, closeto60million lives insured globally.

Established in 1890, 118 yrs of Insurance expertise

More than 70 countries, 173,750 employees worldwide.

Insurance to almost half of the Fortune 500 cos.

ACHIVEMENT OF BAJAJ ALLIANZ

Most Profitable Pvt. Life Insurance Co Rs.63cr (US $ 15.3 mn.) profit for FY 06-07

Over 2 million (20, 79,217) policies in this year highest amongst all put. Sector

players and taking the number 1 position.

Have sold over 3.4 million policies (34, 72,875) issued till date.

Largest distribution network to reach the customers across the country with

2,13,000 agents, present in over 1000 towns, 200 corporate agents & Banc assurance

partners

Accelerated Growth

42


43/98

Fiscal Year No of policies New Business in FY

o sold in FY

2003-2004 (6mths) 21,376 Rs 7 cr.

2005-2006 1, 15,965 Rs 69 cr.

2006-2007 1, 86,443 Rs 180 cr.

2007-2008 2, 88,189 Rs 857 cr.

2008-2009 7, 81,685 Rs 2717 cr.

2009-2010 37, 44,742 Rs 6675 cr.

Assets under management Rs 5,500 cr.

Shareholder capital base of Rs 700 cr.

BAJAJ GROUP

The Bajaj Group is one of the leading business houses of India. Its business interests span

host of industries such as automobiles (two-wheelers and three-wheelers), home appliances,

lighting, iron and steel, insurance, travel and finance. The Bajaj brand is well-known in over

a dozen countries in Europe, South America, the US and Asia. The Bajaj Group comprises 27

companies and its flagship company Bajaj Auto is ranked as the world's fourth largest two-

and three- wheeler manufacturer.

Bajaj Group was founded in 1926, at the height of India's movement for independence from

the British. Jamnalal Bajaj, founder of the group, was a close associate of Mahatma Gandhi.

Jamnalal Bajaj's close involvement in the freedom movement did not leave him with much

time for his business. In 1942, his son Kamalnayan Bajaj took charge of the business. Heconsolidated the group and diversified into various manufacturing activities. Rahul Bajaj, the

present Chairman and Managing Director of the group took reins of the business in 1965.

Under his leadership the group has achieved new heights and ranks among the top 10

business houses in India.

43


44/98

Bajaj Auto Ltd, the flagship company of the Rs. 8000 crore Bajaj group is the largest

manufacturer of two-wheelers and three-wheelers in India and one of the largest in the

world.

A household name in India, Bajaj Auto has a strong brand image & brand loyalty

synonymous with quality & customer focus.

A STRONG INDIAN BRAND- HAMARA BAJAJ

One of the largest 2 & 3 wheeler manufacturer in the world

21 million+ vehicles on the roads across the globe

Managing funds of over Rs 4000 cr.

Bajaj Auto finance one of the largest auto finance cos. in India

BAJAJ AUTO

74%+

ALLIANZ 26%

44


45/98

PRODUCT OF THE COMPANY

A comprehensive list of policies and products offered by Bajaj Allianz Life Insurance

Co. Ltd. is as follows:

Unit Linked Plans

Regular Premium

New UnitGain Super

UnitGain Plus Gold

New UnitGain Plus

New UnitGain

YoungCare

YoungCare Plus

New FamilyGain-R

Single Premium

New UnitGain Premier SP

New UnitGain Plus SP

Pension Plans

Annuity

Pension Guarantee

Retirement

Future Income Generator

Swarna Vishranti

New UnitGain Easy Pension Plus RP

New UnitGain Easy Pension Plus SP

Future Secure

Traditional Plans

Endowment

InvestGain

45


46/98

SaveCare Economy SP

Life Time Care

Super Saver

Money Back

CashGain

Term Plans

Protector

Term Care

New Risk Care

Women Insurance Plans

House Wives

Working Women

Health Plans

Care First

Health Care

Family CareFirst

Children Plans

ChildGain

Group Plans

Non Employer Employee

Credit Shield

Group Term Life(Non Employer Employee)

Group Suraksha

Swayam Shakti Suraksha

Group Loan Protector

Group Income Protection

Employer Employee Group Term Life(Employer Employee)

New Group Gratuity Care

New Group Superannuation Care

Group Save Plus

Group Term Life in lieu of EDLI

Group Leave Encashment Scheme

46


47/98

Group Annuity

Group Superannuation Gold

Group Gratuity Gold

Micro Insurance

Alp Nivesh Yojana

Jana Vikas Yojana

Saral Suraksha Yojana

Other Plans

Family Assure

Fortune Plus

Capital Shield

Century Plus II

The various insurance products of competitors include

Individuals Plans

Unit Gain Insurances

Term Care Plans

Lifetime Care Insurance Policy

Business Insurance Policies

Savings And Security Policies For You And Your Family

Rural Insurance Plan

Healthcare Insurance

Financial Insurance

Pension Plus

Retirement Plans

Children's Policies

Endowment Plans and many more.

Group Insurance Schemes

47


48/98

Insurance For Employee-Employer Groups

Insurance For Non-Employer - Employee Groups

Employees Deposit Linked Insurance

New Group Superannuation Scheme

New Group Gratuity Care Scheme

Special Insurance Policies for NRI's

Invest gain Endowment Plan

Cash gain Money Back Plan

Child gain Kids Special Plan

MISSION,VISION AND COMPANY ACHIEVEMENT:

Vision

To be the first choice insurer for customers

To be the preferred employer for staff in the insurance industry.

To be the number one insurer for creating shareholder value

Mission

As a responsible, customer focused market leader, we will strive to understand the

insurance needs of the consumers and translate it into affordable products that deliver value

for money.

A Partnership Based on Synergy Bajaj Allianz General Insurance offers technical

excellence in all areas of General and Health Insurance as well as Risk Management. This

partnership successfully combines Bajaj Finserv's in-depth understanding of the local market

and extensive distribution network with the global experience and technical expertise of the

Allianz Group.

48


49/98

As a registered Indian Insurance Company and a capital base of Rs. 110 crores, the

company is fully licensed to underwrite all lines of general insurance business including

health insurance.

COMPANY ACHIEVEMENTS:

Bajaj Allianz has received "iAAA rating, from ICRA Limited, an associate of

Moody's Investors Services, for Claims Paying Ability.This rating indicates highest claims

paying ability and a fundamentally strong position

Bajaj Allianz life Insurance has received the prestigious Business Leader in life Insurance,

awarded by NDTV Profit Business Leadership Awards 2009. The company was one of the

top three finalists for the year 2008 and 2009 in the General Insurance Company of the Year

award by Asia Insurance Review.

Competitors of Bajaj Allianz Insurance:

Insurance Companies in India

Top Insurance Companies

Life Insurance Companies

Home Insurance Companies

GIC

AMP Sanmar

Aviva Life

Bharti AXA

Birla Sun Life

49
http://www.indiahousing.com/insurance-companies-india.htmlhttp://www.indiahousing.com/top-home-insurance.htmlhttp://www.indiahousing.com/life-insurance-companies-india.htmlhttp://www.indiahousing.com/home-insurance-companies.htmlhttp://www.indiahousing.com/insurance-companies/gic-general-insurance-corporation-india.htmlhttp://www.indiahousing.com/amp-sanmar-life-insurance.htmlhttp://www.indiahousing.com/aviva-life-insurance-company.htmlhttp://www.indiahousing.com/insurance-companies/bharti-axa-life-insurance-company.htmlhttp://www.indiahousing.com/birla-sun-life-insurance.htmlhttp://www.indiahousing.com/insurance-companies-india.htmlhttp://www.indiahousing.com/top-home-insurance.htmlhttp://www.indiahousing.com/life-insurance-companies-india.htmlhttp://www.indiahousing.com/home-insurance-companies.htmlhttp://www.indiahousing.com/insurance-companies/gic-general-insurance-corporation-india.htmlhttp://www.indiahousing.com/amp-sanmar-life-insurance.htmlhttp://www.indiahousing.com/aviva-life-insurance-company.htmlhttp://www.indiahousing.com/insurance-companies/bharti-axa-life-insurance-company.htmlhttp://www.indiahousing.com/birla-sun-life-insurance.html


50/98

Canara HSBC OBC

Citibank Travel Insurance

Citifinancial Auto Insurance

GE Money

HDFC Life Insurance

ICICI Insurance Co.

ICICI Insurance Schemes

ICICI Prudential

ICICI Lombard

ICICI Life Insurance

ING Vysya

Kotak Mahindra

Max New York

Metlife

Reliance General Insurance

Reliance Life

Reliance Standard Life

Reliance Standard Insurance

Royal Sundaram

Sahara Life

SBI Life

50
http://www.indiahousing.com/insurance-companies/canara-hsbc-obc-life-insurance.htmlhttp://www.indiahousing.com/citibank/citibank-travel-insurance.htmlhttp://www.indiahousing.com/citibank/citifinancial-auto-loans.htmlhttp://www.indiahousing.com/ge-money-home-loans.htmlhttp://www.indiahousing.com/insurance-companies/hdfc-life-insurance.htmlhttp://www.indiahousing.com/icici-bank/icici-insurance-company.htmlhttp://www.indiahousing.com/icici-bank/icici-insurance-schemes.htmlhttp://www.indiahousing.com/icici-bank/icici-prudential.htmlhttp://www.indiahousing.com/icici-bank/icici-lombard.htmlhttp://www.indiahousing.com/insurance-companies/icici-life-insurance-company.htmlhttp://www.indiahousing.com/insurance-companies/ing-vysya-life-insurance-company.htmlhttp://www.indiahousing.com/insurance-companies/kotak-mahindra-insurance-company.htmlhttp://www.indiahousing.com/insurance-companies/max-new-york-life-insurance.htmlhttp://www.indiahousing.com/insurance-companies/metlife-insurance-company-limited.htmlhttp://www.indiahousing.com/insurance-companies/reliance-general-insurance.htmlhttp://www.indiahousing.com/insurance-companies/reliance-life-insurance.htmlhttp://www.indiahousing.com/insurance-companies/reliance-standard-life-insurance.htmlhttp://www.indiahousing.com/insurance-companies/reliance-standard-insurance.htmlhttp://www.indiahousing.com/insurance-companies/royal-sundaram-insurance.htmlhttp://www.indiahousing.com/insurance-companies/sahara-life-insurance-company.htmlhttp://www.indiahousing.com/sbi-life-insurance.htmlhttp://www.indiahousing.com/insurance-companies/canara-hsbc-obc-life-insurance.htmlhttp://www.indiahousing.com/citibank/citibank-travel-insurance.htmlhttp://www.indiahousing.com/citibank/citifinancial-auto-loans.htmlhttp://www.indiahousing.com/ge-money-home-loans.htmlhttp://www.indiahousing.com/insurance-companies/hdfc-life-insurance.htmlhttp://www.indiahousing.com/icici-bank/icici-insurance-company.htmlhttp://www.indiahousing.com/icici-bank/icici-insurance-schemes.htmlhttp://www.indiahousing.com/icici-bank/icici-prudential.htmlhttp://www.indiahousing.com/icici-bank/icici-lombard.htmlhttp://www.indiahousing.com/insurance-companies/icici-life-insurance-company.htmlhttp://www.indiahousing.com/insurance-companies/ing-vysya-life-insurance-company.htmlhttp://www.indiahousing.com/insurance-companies/kotak-mahindra-insurance-company.htmlhttp://www.indiahousing.com/insurance-companies/max-new-york-life-insurance.htmlhttp://www.indiahousing.com/insurance-companies/metlife-insurance-company-limited.htmlhttp://www.indiahousing.com/insurance-companies/reliance-general-insurance.htmlhttp://www.indiahousing.com/insurance-companies/reliance-life-insurance.htmlhttp://www.indiahousing.com/insurance-companies/reliance-standard-life-insurance.htmlhttp://www.indiahousing.com/insurance-companies/reliance-standard-insurance.htmlhttp://www.indiahousing.com/insurance-companies/royal-sundaram-insurance.htmlhttp://www.indiahousing.com/insurance-companies/sahara-life-insurance-company.htmlhttp://www.indiahousing.com/sbi-life-insurance.html


51/98

Shriram Life

Tata AIG

51
http://www.indiahousing.com/insurance-companies/shriram-life-insurance-company.htmlhttp://www.indiahousing.com/insurance-companies/tata-aig-insurance.htmlhttp://www.indiahousing.com/insurance-companies/shriram-life-insurance-company.htmlhttp://www.indiahousing.com/insurance-companies/tata-aig-insurance.html


52/98

BAJAJ ALLIANZ LIFE INSURANCE COMPANY LIMITED

I R D A REGISTATION NO. 116 DATED:-03.08.2001

THE POWER OF YOUR SIDE YOUR VISION

to be the best insurance company in india.

OUR VALUE

*Customer delight the guiding principle

*Ensuring world class solution and services

*Offering customized products

*Transparent benefits

52


53/98

53


54/98

MARKETING ANALYSIS OF THE COMPANY

For the year (2009-10)

Table No.1:-Sale of Private and LIC in various year

After 5 years of opening up of the Indian l i fe insurance indust ry to

foreign JVs, the share of private players have gone up to 28.6% at the end of

FY 2009-10 from 1.4% in FY 2007-08.This is because unlike China, whichimposed severe licensing restrictions, the single licensing norm has seen new

breed of insurance companies es tabl ished i t sel f and grow market share by

rapidly increasing the premium base. The life insurance market has registered

a growth of 35% in terms of new business dur ing the FY 2009-2010 over

previous year.

0

10

20

30

40

50

60

70

80

90

100

2005-

06

2006-

07

2007-

08

2008-

09

2009-

10

LIC

Priva

54


55/98

Table-2: Performance by Policy Count (2009-2010)

LIC sold the most number of policies

In terms of policy count, the share of private players is just 10.8%. LIC

accounts for 92.3% of the new policies

0

10

20

3040

50

60

70

80

90

100

Private LIC

2009-1

55


56/98

POLICY TYPE

New Business Premium by Type of Policy (percentage)

56


57/98

Table No.:-3 Product Mix of various companies

Product Mix

Insurers 2001-02 2002-03 2003-04 2004-05 2005

Although life insurance penetration still at 2.53% at the end of year 2004, India offers

abroad range of products covering term insurance to savings related products. Most of the

insurers are now focusing on unit-linked plans backed by the impressive stock market

performance. Most products are sold to individuals, which accounts for 86% of the new

business

57


58/98

Table No.:-4 Existing Players in the Market

58


59/98

Chart 9: Market Share APE

s

Market T rend: New Bu siness Premi um Growth M onth on M onth 06-0 7

The insurance sector has ended FY07 with new business premium of Rs

754065 mn a growth of 94.4% when compared with FY06.The new business

collection has seen consecutive dip in the month of Dec 06, Jan07 & Feb 07.However, the month of March has seen a growth of 292%. LIC has recoded

404% growt h i n new bus ines s col lect ion i n t he mon th o f Mar 07 when

compared wi th Feb 07 .Pr iva te sector on the o ther hand has wi tnessed a

growth of 155% of new business in the month of Mar 07

59

0

10

20

30

40

50

60

70

FY09 FY10

PrivaLIC


60/98

Table 10: New Business Premium Market Share (%)

Insurers FY01 FY02 FY03 FY04 FY05 FY06 FY07

60

ICICIPrudential31.8%

Birla Sunlife14.4%Bajaj Allianz

11.5%

SBI Life10.2%

HDFC Std. Life7.7%

Tata AIG7.3%

MNYL5.1%

Aviva4.5%

Kotak2.9%

ING Vysya2.1%

AMP Sanmar

1.5%MetLife

1.2%


61/98

SWOT ANALYSIS OF LIFE-INSURANCE INDUSTRY

STRENGTH:

Sector with greatest potential today.

Predicted annual growth rate 18-20%

Life insurance industry in India grew by an impressive 36%, with premium income

from new business at Rs.253.43 billion during the fiscal year 2004-2005.

Tax benefits under section 80 are given on insurance products.

Insurance has emerged as an attractive and stable investment alternative that offers

total protection for life, health, and wealth.

Unit linked plans.

Strong saving culture in India.

Insurance products flexibility i.e. one can shift from one plan to another.

Life insurance provides inflation protection.

WEAKNESS:

Difficulty in development of industry code of conduct, contributing to a common

catastrophe reserve fund and chalking out agreements to settle claims to the benefit of

customer.

Insurance products in India are not perceived as an investment instrument.

Few product changes have taken place since nationalization.

61


62/98

OPPORTUNITY:

More than one billion population.

80% market untapped.

India has an enormous middle-class that can afford to buy life, health, and disability

and pension plan products.

Low level of penetration of life insurance in India compared to other developed

nations.

THREAT:

Lack of awareness in rural India about life insurance policies.

To convince a large population, which is comparatively not well informed about the

intangible benefits of life insurance, is indeed difficult task.

Competition with other instruments of investment. So there will be need to provide

returns comparable to other financial instruments.

Investment management.

62


63/98

63


64/98

DATA ANALYSIS

After col lect ion of data, the analys is of i t was done through var ious

graphs:-

Doughnut

Pie Diagram

Bar Diagram

Tubes

Cones

A cc ord in g to the da ta co lle cted th rou gh su rve y with th e h elp of

ques tionnai re , the break up with r espect to income of individuals i s as

follows:

Research process:

Stage Ist

Understanding the project:

First ly I was enriched with the philosophy of investment and insurance.

secondly I t ri ed to unders tand tha t what made investor s comfortable in

making inves tments in insurance sector and which are the major insurance

schemes in which investors commonly used to invest and

Sta ge 2n d

Problem definition

64


65/98


66/98

Stage 4 th:

Data collection .

I visi ted the ci ty of Kanpur. Here data collection was done by the way of

questionnaire. I met various investors, direct sel l ing, and agents and queried

rega rding the quest ions in the quest ionna ire. In the totality 25 responde nts were

visited by me. The various parameters on which the investors were:

Investment in insurance schemes

Most preferred insurance scheme for investment and risk cover

Returns of insurance schemes

Dominating influence in financial decision making

Criteria for investment and insurance evaluation

Minimum time period for blocking the funds

Satisfaction towards investment in insurance schemes

Risk involved investment and insurance schemes.

Sampling design . It encompasses the following information.

Sampling universe: Investors of various insurance companies.

Sample size: 100

Sample procedure: Purposive, jud gment, and selective sampling

Sampling type: convenient sampling

66


67/98

Stage 6 th

Data analysis:

Dat a unt il ana ly zed i s o f no use . Ana ly si s was done i n t he o rder o f

i nves to rs v is it ed and t hen a conso li da ted ana ly si s was done ( re fe r t o

annexure)

Stage 7 th :

Data interpretation:

Data was interpre ted and inferences were drawn and t ransformed to

meaningful informat ion to help management to get a vivid picture and to

make accurate decision there from.

METHOD EMPLOYED

The approach t o t he r es ea rch i s consi de red i n t hi s chapt er , f rom t he

theoretical underpinning to the collection and analysis of the data. I t begins

with the extent of the research to provide the specific guidelines of studying.

The next part is concerned with the method of the research that refers to the

data collection and analyzing which is used in the research.

67


68/98

METHODS

PRIMARY DATA:

Date collection for this research was done primarily through fi l l ing up

of questionnaire. The sample for the research including different individuals

of var ious age groups and having di f ferent profess ions and qual i f icat ions .

Data was collected through the interview of individuals . The questionnaire

was containing ques t ions regarding the personal detai ls of individuals and

then some l ight ques tions r egarding the ir primary knowledge related to

pr ivate insurance companies . Then there were quest ions related to their

interest in being the Insurance Consultants of company.

SECONDARY DATA:

A large amount of secondary da ta has been coll ec ted f rom secondary

sources. Some of the sources are:-

Reports on Insurance Sector of India.

Articles from Newspapers and magazines.

Various web sites of the insurance companies and related sites.

DATA ANALYSIS:

68


69/98

There are some fea tures of analyzing da ta tha t need to be borne in

min d wh en c ho osin g th e metho d fo r an alyzing the re searc h. T he

questionnaires were prepared to explore the psychology of individuals about

being associated BAJAJ ALLIANZ Life Insurance as Insurance Consultants

and to help the company grow by increas ing i t s sales . Ins tead of tes t ing a

hypothes is, a quali tat ive analys t may demonstrate evidence showing that a

theory, generalizing, or interpretation is plausible.

SAMPLE SIZE :-

Various areas of Kanpur were covered in order to fill thequestionnaire. I interacted with 100 individuals in order to know about their

interest of being Insurance Consultants of BAJAJ ALLIANZ Life Insurance.

SAMPLE COMPOSITION:

Youth

Executives

Serviceman

Business persons

RESEARCH DESIGN :

A research des ign provides the f r amework to be used as a guide in

collecting and analyzing data.

TYPES OF RESEARCH:

The basic types of research are as follows:

69


70/98

Des cri pt ive vs. analytical: descriptive research includes surveys and fact-

f inding enquir ies of d if ferent k inds. The major purpose of descript ive

research i s descr ip t ion of the s ta te of a ffa ir s as i t ex is ts a t present. In

analyt ical research, on the other hand, the researches have to use facts or

information already available and analyze these to make a cri t ical evaluation

of the material.

Applied vs. fundamental: research can either be applied (or action) research

or fundamental (or basic or pure) research. Applied research aims at finding a

solution for an immediate problem facing a society or an industr ial/ business

organiza tion, whereas fundamenta l, r esearch i s mainly concerned with

generalizations and with the formulation of theory.

Quantitative vs. quantitative: quant it at ive r e sear ch i s bas ed on t he

measurement of quantity or amount. It is applicable to phenomena that can be

expressed in terms of quant i ty . Qual i tat ive research, on the other hand, i s

concerned wi th the quali tative phenomena, i .e. , phenomena relat ing to or

involving quality or kind.

Conceptual vs. empirical : conceptual research is the one that is related to

some abs t ract idea (s ) or theory . I t i s general ly used by phi losophers and

thinkers to develop new concepts or to reinterpret existing ones. On the other

hand, empir ical research rel ies on exper ience or observat ion alone, of ten

without regard for system and theory. I t is data based research. Coming up

wi th conclus ions which are capable of be ing veri fi ed by observation or

experiment.

Other: all other types of research are variat ion of one or more of the above

s ta ted approaches , based on e i ther the purpose of r esearch , or the t ime

required to accomplish research, or the environment in which research is

done, or on the basis of some other factor. From the point of view of time, we

can think of research ei ther as one t ime research or longitudinal research. In

70


71/98

the former case, the research is confined to a single t ime period, whereas in

the latter case, the research is carried over a span of time.

s

APPROACHES

Consultative Selling Process

Complete Product Range

Superior Customer service

Well trained & quality Advisor force

Target Urban households

Affluent & HNW customer segment via Tied Agency & select Banks

Mass segment via Public Sector banks & other Corporate Agents

71


72/98

18-25 yrs

26-30 yrs

31-40 yrs

41-50 yrs

51-60 yes

CLASSIFICATION ON THE BASIS OF PREFERENCE FOR

LIC AND PRIVATE PLAYERS:

The age group classif ication through which the survey was conducted, is as

follows

18-25

26-30

31-40

40-50

50-60+

In the above mentioned age groups, various people were asked of their

preferences among L.I.C. and the other private players prevalent these days.

Then percentage of people who preferred LIC and percentage pf people

preferring private companies was sorted out by the compiler. This analysis

72


73/98

was just on the basis of preference of the customer and not on the actual

companies they have invested their money.

The results obtained were as follows:

0

20

40

60

80

100

18-25 26-30 31-40 41-50 50-Above

Private

LIC

CLASSIFICATION OF PREFERENCE FOR LIC AND

PRIVATE COMPANIES IN TOTALITY:

Out of the total 50 respondents covered by the compiler , some

of the people preferred LIC and some others preferred private players. But

without a proper representat ion of those preferences in terms of percentages,

the repor t would be ineffect ive. So here i s the representat ion of the facts

obtained by the survey conducted, this analys is i s only on the bas is of the

preference o f the customers.

73


74/98


75/98

18-25 66.67%

26-30 100%

31-40 100%

40-50 85.71%

50-60 83.33%

0.00%

10.00%

20.00%30.00%

40.00%

50.00%

60.00%

70.00%

80.00%

90.00%

100.00%

18-25

yrs

26-30

yrs

31-40

yrs

40-50

yrs

50-60

yrs

% insured

CLASSIFICATION ON THE BASIS OF INSURANCE

AWARENESS IN TOTALITY:

Out of the total respondents vis i ted by the compi ler , the percentage of

people insured in totality, was as follows:

% respondents insured 88%

% respondents not insured 12%

75


76/98

non

insured,

12

insured,

88

0

10

2030

40

50

60

7080

90

insure

non in

ACTUAL CLASSIFICATION ON BRAND LOYALTY

In this category, it was analyzed in which sector had the respondents actually

invested their money, in private companies or in L.I .C? Though earl ier they

preferred LIC for investment and insurance, the actual results obtained were

excit ingly di f ferent f rom the preferences of the respondents. The resul ts

obtained were as follows:

AGE OF RESPONDENTS % INSURED WITH LIC

18-25 0%

26-30 33.33%

76


77/98

30-40 66.67%

40-50 42.85%

50-60 83.33%

0%

10%

20%

30%

40%

50%

60%

70%

80%90%

18-

25

yrs

26-

30

yrs

30-

40

yrs

40-

50

yrs

50-

60

yrs

% insured withLIC

INCOME WISE CLASSIFICATION.

The total number of respondents covered by the compiler was categorized

income wise into various segments. These segments are as follows:

Income of respondents No of respondents

1-2 lakh 28

2-3 lakh 36

3-4 lakh 32

4-5 lakh $ above 4

77


78/98

0

5

10

15

20

25

30

35

40

1-2

lakh

2-3

lakh

3-4

lakh

above

4 lakh

Sala

78


79/98

79


80/98

INTERPRETATION OF DATA

Age Group Classification.

Class if icat ion on t he bas is o f p re fe rence f or L IC and Pri va te

Companies.

Classification on the basis of preference for totally.

Classification on the basis of Insurance awareness.

Classification on the basis of Insurance awareness in totally.

Actual Classification on Brand loyalty.

Income wise Classification

AGE GROUP CLASSIFICATION.

Maximum number of r espondents be longed to the age group 40-

50(28%). But mature people of the age group 31-40 were also covered by

the compiler which contributed up to 12%. Apart from this , respondents

belonging to the age group 18-25 and 26-30 were included as well, which

formed the proportion of 12% and 24% respectively. Not excluding the

senior ci t izens group belonging to the age group 50-60 and above, which

formed a major sector contributing up to 24%? All these depict the wide

area of respondents covered by the compiler.

80


81/98

81


82/98

FINDINGS

Peopl e a re becoming mor e & mor e money consc ious a s I

didnt find any person who doesnt want to earn extra money.

People are very much aware of ICICI Prudential among private

companies and LIC in public sector as they respond me f i rs t

name of LIC then ICICI prudential and then others.

The overall scenario is that still people trust on LIC more than

any o ther i ns ur ance company . Somet imes when I a sked

someone to become an agent of Baja j Life Insurance they

misunderstood with LIC. For them st i l l l i fe insurance means

LIC.

Contr ar y o f t he p ri or t hi nk ing mos t o f t he peopl e dont

hes i tate in doing f ield work a roaming in the market . They

know that without hard work they cant earn money.

There were many respondents who were not interested in

at tending seminar conducted by Bajaj Life Insurance among

Indian Market.

82


83/98

83

8/6/201

insurence project r.p.1

Documents