relaince - anjali

7/28/2019 Relaince - Anjali

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CONTENTS

Pages

ACKNOWLEDGEMENT 03

PREFACE 04

EXECUTIVE SUMMARY 06

INTRODUCTION TO THE INDUSTRY 07

INTRODUCTION TO THE COMPANY 20RESEARCH METHODOLOGY 26

Title

Objective of the Study

Scope of the Study

Significance of the Industry

Significance of the Research Research Technique

Sampling Methodology

Sampling unit

Sampling Area

Sample Size

LimitationsMARKETING STRATREGIES OF THE COMPANY 30

FACTS AND FINDINGS 32

DATA AND INTERPRETATION 34

CONCLUSION & RECOMMENDATIONS 54

BIBLIOGRAPHY 56

ANNEXURE

Questionnaire 58


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PREFACE

The liberalization of the Indian insurance sector has been the subject of

much heated debate for some years. The policy makers where in the catch

22 situation wherein for one they wanted competition, development and

growth of this insurance sector which is extremely essential for channeling

the investments in to the infrastructure sector. At the other end the policy

makers had the fears that the insurance premia, which are substantial,

would seep out of the country; and wanted to have a cautious approach of

opening for foreign participation in the sector.

As one of the rare occurrences the entire debate was put on the back burner

and the IRDA saw the day of the light thanks to the maturing polity

emerging consensus among factions of different political parties. Though

some changes and some restrictive clauses as regards to the foreign

participation were included the IRDA has opened the doors for the private

entry into insurance.

Whether the insurer is old or new, private or public, expanding the market

will present multitude of challenges and opportunities. But the key issues,

possible trends, opportunities and challenges that insurance sector will

have still remains under the realms of the possibilities and speculation.

What is the likely impact of opening up Indias insurance sector?


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The large scale of operations, public sector bureaucracies and cumbersome

procedures hampers nationalized insurers. Therefore, potential private

entrants expect to score in the areas of customer service, speed and

flexibility. They point out that their entry will mean better products and

choice for the consumer. The critics counter that the benefit will be slim,

because new players will concentrate on affluent, urban customers as

foreign banks did until recently. This seems to be a logical strategy. Start-

up costs-such as those of setting up a conventional distribution network-are

large and high-end niches offer better returns. However, the middle-market

segment too has great potential. Since insurance is a volumes game.

Therefore, private insurers would be best served by a middle-market

approach, targeting customer segments that are currently untapped.


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EXECUTIVE SUMMARY

In todays corporate and competitive world, I find that insurance sector has

the maximum growth and potential as compared to the other sectors.

Insurance has the maximum growth rate of 70-80% while as FMCG sector

has maximum 12-15% of growth rate. This growth potential attracts me to

enter in this sector and RELIANCE LIFE INSURANCE has given me the

opportunity to work and get experience in highly competitive and

enhancing sector.

The success story of good market share of different market

organizations depends upon the availability of the product and

services near to the customer, which can be distributed through a

distribution channel. In Insurance sector, distribution channel

includes only agents or agency holders of the company. If a

company like RELIANCE LIFE INSURANCE, TATA AIG, MAX

etc have adequate agents in the market they can capture big market

as compared to the other companies.

Agents are the only way for a company of Insurance sector through

which policies and benefits of the company can be explained to the

customer .


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INTRODUCTION TO THE INDUSTRY

THE HISTORY OF INDIAN INSURANCE INDUSTRY

Life Insurance

In 1818 the British established the first insurance company in India in

Calcutta, the Oriental Life Insurance Company. First attempts at regulation

of the industry were made with the introduction of the Indian Life

Assurance Companies Act in 1912. A number of amendments to this Act

were made until the Insurance Act was drawn up in 1938. Noteworthy

features in the Act were the power given to the Government to collect

statistical information about the insured and the high level of protection the

Act gave to the public through regulation and control. When the Act was

changed in 1950, this meant far reaching changes in the industry. The extra

requirements included a statutory requirement of a certain level of equity

capital, a ceiling on share holdings in such companies to prevent dominant

control (to protect the public from any adversarial policies from one single

party), stricter control on investments and, generally, much tighter control.

In 1956, the market contained 154 Indian and 16 foreign life insurance

companies. Business was heavily concentrated in urban areas and targeted

the higher echelons of society. Unethical practices adopted by some of the


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players against the interests of the consumers then led the Indian

government to nationalize the industry. In September 1956, nationalization

was completed, merging all these companies into the so-called Life

Insurance Corporation (LIC). It was felt that nationalization has lent the

industry fairness, solidity, growth and reach.

Some of the important milestones in the life insurance business in

India are:

1912: The Indian Life Assurance Companies Act enacted as the first

statute to regulate the life insurance business.

1928: The Indian Insurance Companies Act enacted to enable the

government to collect statistical information about both life and non-life

insurance businesses.

1938: Earlier legislation consolidated and amended to by the Insurance Act

with the objective of protecting the interests of the insuring public.

1956: The market contained 154 Indian and 16 foreign life insurance

companies.

General Insurance

The General Insurance industry in India dates back to the Industrial

Revolution and the subsequent increase in trade across the oceans in the

17th century. As for Life Insurance, the British brought General Insurance


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to India, and a similar path was followed in the development of this

industry. A number of private companies were in existence for years and

years until, in 1971, the Indian Government decided that the public interest

would be served by nationalizing the industry, merging all the 107

companies into four companies, depending on the sort of business

transacted (Marine, Fire, Miscellaneous). These were the National

Insurance Company Ltd., the Oriental Insurance Company Ltd., the New

India Assurance Company Ltd., and the United India Insurance Company

Ltd. located in Calcutta, New Delhi, Bombay and Madras respectively.

The General Insurance Corporation (GIC) was set up in 1972 as a

holding company, having these four companies as its sub sidiaries.


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Some of the important milestones in the general insurance business in

India are:

1907: The Indian Mercantile Insurance Ltd . set up, the first company to

transact all classes of general insurance business.

1957: General Insurance Council , a wing of the Insurance Association of

India, frames a code of conduct for ensuring fair conduct and sound

business practices.

1968: The Insurance Act amended to regulate investments and set

minimum solvency margins and the Tariff Advisory Committee set up.

1972: The General Insurance Business (Nationalization) Act, 1972

nationalize the general insurance business in India with effect from 1st

January 1973. 107 insurers amalgamated and grouped into four companies

viz. the National Insurance Company Ltd., the New India Assurance

Company Ltd., the Oriental Insurance Company Ltd. and the United

India Insurance Company Ltd . GIC incorporated as a company.


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Life Insurance Corporation of India (LIC)

Life Insurance Corporation of India (LIC) was established on 1 September

1956 to spread the message of life insurance in the country and mobilise

peoples savings for nation -building activities. LIC with its central office

in Mumbai and seven zonal offices at Mumbai, Calcutta, Delhi, Chennai,

Hyderabad, Kanpur and Bhopal, operates through 100 divisional offices in

important cities and 2,048 branch offices. LIC has 5.59 lakh active agents

spread over the country.

The Corporation also transacts business abroad and has offices in Fiji,

Mauritius and United Kingdom. LIC is associated with joint ventures

abroad in the field of insurance, namely, Ken-India Assurance Company

Limited, Nairobi; United Oriental Assurance Company Limited, Kuala

Lumpur; and Life Insurance Corporation (International), E.C. Bahrain. It

has also entered into an agreement with the Sun Life (UK) for marketing

unit linked life insurance and pension policies in U.K.

In 1995-96, LIC had a total income from premium and investments of $ 5

Billion while GIC recorded a net premium of $ 1.3 Billion. During the last

15 years, LIC's income grew at a healthy average of 10 per cent as against


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the industry's 6.7 per cent growth in the rest of Asia (3.4 per cent in

Europe, 1.4 per cent in the US).

LIC has even provided insurance cover to five million people living below

the poverty line, with 50 per cent subsidy in the premium rates. LIC's

claims settlement ratio at 95 per cent and GIC's at 74 per cent are higher

than that of global average of 40 per cent. Compounded annual growth rate

for Life insurance business has been 19.22 per cent per annum

General Insurance Corporation of India (GIC)

The general insurance industry in India was nationalized and a government

company known as General Insurance Corporation of India (GIC) was

formed by the Central Government in November 1972. With effect from 1

January 1973 the erstwhile 107 Indian and foreign insurers which were

operating in the country prior to nationalization, were grouped into four

operating companies, namely, (i) National Insurance Company Limited;

(ii) New India Assurance Company Limited; (iii) Oriental Insurance

Company Limited; and (iv) United India Insurance Company Limited.

(However, with effect from Dec'2000, these subsidiaries have been de-

linked from the parent company and made as independent insurance

companies). All the above four subsidiaries of GIC operate all over the

country competing with one another and underwriting various classes of


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general insurance business except for aviation insurance of national

airlines and crop insurance which is handled by the GIC.

Besides the domestic market, the industry is presently operating in 17

countries directly through branches or agencies and in 14 countries through

subsidiary and associate companies.

IN ADDITION TO ABOVE STATE INSURERS THE FOLLOWING

HAVE BEEN PERMITTED TO ENTER INTO INSURANCE

BUSINESS: -

The introduction of private players in the industry has added to the colors

in the dull industry. The initiatives taken by the private players are very

competitive and have given immense competition to the on time monopoly

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

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

sector. The new players have improved the service quality of the insurance.

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

The market share was distributed among the private players. Though LIC

still holds the 75% of the insurance sector but the upcoming natures of

these private players are enough to give more competition to LIC in the

near future. LIC market share has decreased from 95% (2002-03) to 82 %(

2004-05).

1. HDFC Standard Life Insurance Company Ltd .


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HDFC Standard Life Insurance Company Ltd. is one of Indias leadi ng

private life insurance companies, which offers a range of individual and

group insurance solutions. It is a joint venture between Housing

Development Finance Corporation Limited (HDFC Ltd.), Indias leading

housing finance institution and The Standard Life Assurance Company, a

leading provider of financial services from the United Kingdom. Their

cumulative premium income, including the first year premiums and

renewal premiums is Rs. 672.3 for the financial year, Apr-Nov 2005. They

have managed to cover over 11,00,000 individuals out of which over

3,40,000 lives have been covered through our group business tie-ups.

2. RELIANCE LIFE INSURNACE Life Insurance Co. Ltd.

RELIANCE LIFE INSURNACE Life Insurance Company Limited is a

joint venture that brings together two large forces - Max India Limited, a

multi-business corporate, together with New York Life International, a

global expert in life insurance. With their various Products and Riders,

there are more than 400 product combinations to choose from. They have a

national presence with a network of 57 offices in 37 cities across India.


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3. ICICI Prudential Life Insurance Company Ltd.

ICICI Prudential Life Insurance Company is a joint venture between ICICI

Bank, a premier financial powerhouse and Prudential plc, a leading

international financial services group headquartered in the United

Kingdom. ICICI Prudential was amongst the first private sector insurance

companies to begin operations in December 2000 after receiving approval

from Insurance Regulatory Development Authority (IRDA). The company

has a network of about 56,000 advisors; as well as 7 bancassurance and

150 corporate agent tie-ups.

4. Om Kotak Mahindra Life Insurance Co. Ltd.

Kotak Mahindra Old Mutual Life Insurance Ltd. is a joint venture between

Kotak Mahindra Bank Ltd. (KMBL), and Old Mutual plc.

5.Birla Sun Life Insurance Company Ltd.

Birla Sun Life Insurance Company is a joint venture between Aditya Birla

Group and Sun Life financial Services of Canada.

Tata AIG Life Insurance Company Ltd.

SBI Life Insurance Company Limited

ING Vysya Life Insurance Company Private Limited

Allianz Bajaj Life Insurance Company Ltd.

Metlife India Insurance Company Pvt. Ltd.


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AMP SANMAR Assurance Company Ltd.

Dabur CGU Life Insurance Company Pvt. Ltd.

1. Royal Sundaram Alliance Insurance Company Limited

The joint venture bringing together Royal & Sun Alliance Insurance and

Sundaram Finance Limited started its operations from March 2001. The

company is Head Quartered at Chennai, and has two Regional Offices, one

at Mumbai and another one at New Delhi.

2. 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.

3. ICICI Lombard General Insurance Company Limited

ICICI Lombard General Insurance Company Limited is a joint venture

between ICICI Bank Limited and the US-based $ 26 billion Fairfax


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Financial Holdings Limited. ICICI Bank is India's second largest bank,

while Fairfax Financial Holdings is a diversified financial corporate

engaged in general insurance, reinsurance, insurance claims management

and investment management.

Lombard Canada Ltd, a group company of Fairfax Financial Holdings

Limited, is one of Canada's oldest property and casualty insurers. ICICI

Lombard General Insurance Company received regulatory approvals to

commence general insurance business in August 2001.

4. Cholamandalam General Insurance Company Ltd.

Cholamandalam MS General Insurance Company Limited (Chola-MS) is a

joint venture of the Murugappa Group & Mitsui Sumitomo.

Chola-MS commenced operations in October 2002 and has issued more

than 1.4 lakh policies in its first calendar year of operations. The company

has a pan-Indian presence with offices in Chennai, Hyderabad, Bangalore,

Kochi, Coimbatore, Mumbai, Pune, Indore, Ahmedabad, Delhi,

Chandigarh, Kolkata and Vizag.

5. TATA AIG General Insurance Company Ltd.

Tata AIG General Insurance Company Ltd. is a joint venture company,

formed from the Tata Group and American International Group, Inc.

(AIG). Tata AIG combines the strength and integrity of the Tata Group


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with AIG's international expertise and financial strength. The Tata Group

holds 74 per cent stake in the two insurance ventures while AIG holds the

balance 26 per cent stake.

Tata AIG General Insurance Company, which started its operations in

India on January 22, 2001, offers the complete range of insurance for

automobile, home, personal accident, travel, energy, marine, property and

casualty, as well as several specialized financial lines.

6. Reliance General Insurance Company Limited.

7. IFFCO Tokio General Insurance Co. Ltd

8. Export Credit Guarantee Corporation Ltd.

9. HDFC-Chubb General Insurance Co. Ltd.


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COMPANY PROFILE

RELIANCE LIFE INSURANCE

FOUNDER

Few men in history have made as dramatic a contribution to their countrys

economic fortunes as did the founder of Reliance, Sh. Dhirubhai H

Ambani. Fewer still have left behind a legacy that is more enduring and

timeless.

As with all great pioneers, there is more than one unique way of

describing the true genius of Dhirubhai: The corporate visionary, the

unmatched strategist, the proud patriot, the leader of men, the architect

of Indias capital markets, the champion of shareholder interest.

But the role Dhirubhai cherished most was perhaps that of Indias

greatest wealth creator. In one lifetime, he built, starting from the

proverbial scratch, India s largest private sector enterprise.

When Dhirubhai embarked on his first business venture, he had a seed

capital of barely US$ 300 (around Rs 14,000). Over the next three and a

half decades, he converted this fledgling enterprise into a Rs 60,000

crore colossus an achievement which earned Reliance a place on the

global Fortune 500 list, the first ever Indian private company to do so.


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Dhirubhai is widely regarded as the father of Indias capital markets. In

1977, when Reliance Textile Industries Limited first went public, the

Indian stock market was a place patronised by a small club of elite

investors which dabbled in a handful of stocks.

Undaunted, Dhirubhai managed to convince a large number of first-

time retail investors to participate in the unfolding Reliance story and

put their hard-earned money in the Reliance Textile IPO, promising

them, in exchange for their trust, substantial return on their investments.

It was to be the start of one of great stories of mutual respect and

reciprocal gain in the Indian markets.

Under Dhirubhais extraordinary vision and leadership, Reliance

scripted one of the greatest growth stories in corporate history

anywhere in the world, and went on to become Indias largest private

sector enterprise.

Through out this amazing journey, Dhirubhai always kept the interests

of the ordinary shareholder uppermost in mind, in the process making

millionaires out of many of the initial investors in the Reliance stock,

and creating one of the worlds largest shareholder families.


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ABOUT RELIANCE

Reliance Life Insurance Company Limited is a part of Reliance Capital

Ltd. of the Reliance - Anil Dhirubhai Ambani Group. Reliance Capital is

one of Indias leading private sector financial services companies, and

ranks among the top 3 private sector financial services and banking

companies, in terms of net worth. Reliance Capital has interests in asset

management and mutual funds, stock broking, life and general insurance,

proprietary investments, private equity and other activities in financial

services.

Reliance Capital Limited (RCL) is a Non-Banking Financial Company

(NBFC) registered with the Reserve Bank of India under section 45-IA

of the Reserve Bank of India Act, 1934.

Reliance Capital sees immense potential in the rapidly growing

financial services sector in India and aims to become a dominant player

in this industry and offer fully integrated financial services.

Reliance Life Insurance is another step forward for Reliance Capital

Limited to offer need based Life Insurance solutions to individuals and

Corporates.


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CORPORATE OBJECTIVE

At Reliance Life Insurance, we strongly believe that as life is different at

every stage, life insurance must offer flexibility and choice to go with that

stage. We are fully prepared and committed to guide you on insurance

products and services through our well-trained advisors, backed by

competent marketing and customer services, in the best possible way.

It is our aim to become one of the top private life insurance

companies in India and to become a cornerstone of RLI integrated

financial services business in India.

CORPORATE MISSION

To set the standard in helping our customers manage their financial

future.

BELOW ARE FEW OF THE PLANS THAT ARE OFFERED BYRELIANCE LIFE INSURANCE

INSURANCE PLANS AVAILABLE

1. Products (Individual Plans)

Savings (Endowment)


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2. Reliance Endowment Plan

(formerly Divya Shree)

3. Reliance Special Endowment Plan

(formerly Subha Shree)

4. Reliance Cash Flow Plan

(formerly Dhana Shree)

5. Reliance Child Plan

(formerly Yuva Shree)

6. Reliance Whole Life Plan

(formerly Nithya Shree)

Pensions

7. Reliance Golden Years Plan

(formerly Bhagya Shree)

Investments

8. Reliance Market Return Plan

(formerly Kanaka Shree)

9. Risk / Protection

10. Reliance Term Plan

(formerly Raksha Shree)

Products (Group / Corporate Plans)

11. Risk (Protection)
http://www.reliancelife.co.in/products/ind_REP.asphttp://www.reliancelife.co.in/products/ind_RSEP.asphttp://www.reliancelife.co.in/products/ind_RCFP.asphttp://www.reliancelife.co.in/products/ind_RCP.asphttp://www.reliancelife.co.in/products/ind_RWLP.asphttp://www.reliancelife.co.in/products/ind_RGYP.asphttp://www.reliancelife.co.in/products/ind_RMRP.asphttp://www.reliancelife.co.in/products/ind_RTP.asphttp://www.reliancelife.co.in/products/ind_RTP.asphttp://www.reliancelife.co.in/products/ind_RTP.asphttp://www.reliancelife.co.in/products/ind_RTP.asphttp://www.reliancelife.co.in/products/ind_RMRP.asphttp://www.reliancelife.co.in/products/ind_RGYP.asphttp://www.reliancelife.co.in/products/ind_RWLP.asphttp://www.reliancelife.co.in/products/ind_RCP.asphttp://www.reliancelife.co.in/products/ind_RCFP.asphttp://www.reliancelife.co.in/products/ind_RSEP.asphttp://www.reliancelife.co.in/products/ind_REP.asp


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Reliance Group Term Assurance Policy

(formerly Group Term Assurance Policy)

Reliance EDLI Scheme

(formerly EDLI Scheme)

12. Pensions

a. Reliance Group Gratuity Policy(formerly Group Gratuity Policy)

b. Reliance Group Superannuation Policy(formerly Group Superannuation Policy)

13. Reliance Money Guarantee Plan
http://www.reliancelife.co.in/products/ebp_RCESP.asphttp://www.reliancelife.co.in/products/ebp_EDLI.asphttp://www.reliancelife.co.in/products/ebp_RCBP.asphttp://www.reliancelife.co.in/products/ebp_RCPP.asphttp://www.reliancelife.co.in/products/ebp_RCPP.asphttp://www.reliancelife.co.in/products/ebp_RCBP.asphttp://www.reliancelife.co.in/products/ebp_EDLI.asphttp://www.reliancelife.co.in/products/ebp_RCESP.asp


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PRODUCTS

Solutions for IndividualsTaking time out from your daily schedule to plan your future is anecessary task. You could do with some help, but who can help you?

Reliance Life Insurance is here with Solutions for Individuals, a seriesof plans that will help you make wise investments, protect your family,secure your childs f uture and even chalk out a plan for yourretirement.

So what are you waiting for? Invest in one of Reliance Solutions forIndividuals and pave the way for a worry-free life!

PlansProtection Plans

Protect your family even when youre not around by investing in RelianceProtection Plans. Choose a limited period plan or a lifetime protection plan

depending on your needs.. Read MoreSavings & Investment Plans

Reliance Savings & Investment Plans help you to set aside some money toachieve specific goals in life, which means that you can enjoy life and

provide for your familys daily needs... Read More

Retirement PlansInvest today in Reliance Retirement Plans and save money to enjoy lifeeven after retirement. You will never have to depend on another person or make any compromises to maintain your current lifestyle... Read More

Child PlansSave systematically and secure your childs future needs by investing inReliance Child Plans. You can always be there for your child when he or she needs you... Read More


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COMPARISION

NEW UNIT GAIN PLUS Vs LIC BIMA PLUS

FEATURES NEW UNIT GAIN PLUS

LIC BIMA PLUS

Age0-60 years 12-56 years

Term Choice rests with a minimum

period of payment of 3 years.

10 years

Sum Assured Minimum sum assured is 5

times the premium paid.

Maximum sum assured is as

per the limits set per age bands.

Maximum limit up to

Rs. 2 lakhs.

Survival BenefitValue of Fund at Bid Price Bid value of the fund units

along with maturity bonus at


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5% of the Sum Assured.

Death Benefit

Higher the Sum Assured or

value of units. However, the

value of units will treat as

death benefit if the Life

Assured is > 7 years or < 70

years.

Death during the 1 st 6 months-

30% of SA + value of units,

next 6 months 60% of SA +

value of units. Death after 1 st

year-SA +value of units. Death

during the 10 th year- 105% of

SA + value of units.

Withdrawal Benefit

Partial or complete

withdrawals at bid price

after3 rd year.

Premature withdrawal allowed

1 year(after applying bid-offer

spread).


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Contribution Minimum: Rs. 15,000 p.a Not specified.

Flexibility to

increase/decrease

contribution

Only an increase in

contribution is allowed.

Not available.

Investment optionsEquity Fund, Debt Fund,

Balanced Fund, Cash Fund.

Balanced, Secured & Risk.

Increase/Decrease

of death benefit

Available. Not available.

Bonus Points Not Available. Not available.

Top-upAvailable. Available (charges: 1.5% of

the top-up).


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Switch 3 free switches every policy

year. Subsequent switches

would be charged @1% of

switch amount or Rs. 100

whichever is higher.

No free switches. Cost of

switches is 2% of the fund

value.

Surrender ValueA selling/purchase price

spread of 5% will be

applicable from the 3 rd year

onwards.

Partial surrender up to 50%

of bid value of units allowed

after 3 years from the date of

commencement.

Automatic Cover

Continuance

Available after the 3 rd policy

year.

Not available.


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Initial charge

Charges :

1st Year- 24% ; 2 nd Year-3%

3rd Year- 3%. No charges

grom 4 th year onwards.

Not disclosed

Admin charges Annual admin. Charges of

1.25% of net assets.

Other charges Transaction charge of

0.5% of the equity

investment & 0.1% of

the debt investments.

Not applicable.

Bid-offer spread The bid-offer spread is

5% of the offer price.

Not applicable.

Fund management

Charge

Annual investment charge of

1% p.a. of net assets. 1% of the fund per annum


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Riders

ABR/ ADBR / CI/Hospital

Cash Benefits.

In Built Accident Benefit.


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CHILD CARE Vs SMART KID (ICICI Pru.

FEATURESCHILD CARE SMART KID

Plan Type Anticipated Endowment. Anticipated Endowment.

Min Max Term Matures when the child reaches th

age of 21 or 24. Premium paid till

child reaches age 18.

Matures between 22-25 years of

child. Term is 10-25 tears.

Min Max Age

of Child

1-13 Years. 0-12 Years.

Min Max Age

of Parent


Payment

Modes

All regular premiums. All regular premiums.

Life Assured Parent.


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Child is insured. But premium

waiver rider available for

parent.

BeneficiaryChild

Child.

Flexibility in

benefit

structure

2 structures :

1. Money is paid on the 18 th,

19 th, 20 th and 21 st year

(20%+25%+25%+35%)

2. Money is paid on the 18th

,

20 th, 22nd or 24 th year

(25%+25%+25%+40%)

2 structures :

1. When the child reaches the

criteria milestones ( Xth,

XIIth, Graduation, Post

Grad.)

2. Last 4 year before

maturity.

Benefit-Death

of Parent

None if premium waiver rider is no

purchased.

SA is paid up front. Child gets

Guaranteed payments as

chosen earlier.All future


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premiums are waived off.

Benefit- Death

of Child

< 7 years Premiums

refunded without

interest >7 years & 18 years

Outstanding payments as a lump su

Policy continues as it is.

Bonus &

Additions

Not guaranteed. Paid after the end

the premium paying term.

3.5% of SA compounded

annually for the1 st 4 years,

annual bonuses declared

thereafter.

Riders

available

Family Income Rider/ Premium

Waiver Rider.

ADBR / IBR

Surrender

Value

Available after 3 premium paying

years.

Available after 3 premium

paying years.


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CHILD CARE Vs HDFC CHILD PLAN

FEATURES CHILD CAREHDFC CHILD PLAN

Plan Type Anticipated Endowment.

Endowment.

Min Max

Term

Matures when the child reaches

age of 21 or 24 Premium paid

child reaches age 18.

10-25 Years.

Min Max

Age of Child

0-13 Years.

Min Max

Age of

Parent


Payment All regular premiums. All regular premiums.


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Modes

Life AssuredChild is insured. But premium


parent.

Parent.

BeneficiaryChild.

Child.

Flexibility in

benefit

structure

2 structures :

1. Money is paid on the 18 th, 19 th,

20 th and 21 st year

(20%+25%+25%+35%)

2. Money is paid on the 18 th, 20 th,

22nd or 24 th year

(25%+25%+25%+40%).

The customer has to choose

amongst 3 separate plans,

with deferring premiums

based on the plans.


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Benefit-

Death of

Parent

None if premium waiver rider is not purchase Opt for either one of

the plans:

1. SA+ Bonuses

paid upfront

2. SA +

Bonuses paid

on maturity.

3. SA paid on

death & SA +

Bonuses paid

on maturity.

Benefit-

Death of

Child

< 7 years Premiums refunded

without interest >7 years & 18 years Outstandin

payments as a lump sum

Policy continues as it


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Bonus &

Additions

Not Guaranteed. Paid after the end of the

premium Paying term.

Simple

Reversionary

Bonuses paid till

maturity.

Riders

available

Family Income Rider/ Premium Waiver Ride None.

Surrender

Value

Available after 3 premium paying years. Available.

CHILD CARE Vs OM KOTAK CHILD ADVANTAGE

FEATURES CHILD CAREOM KOTAK CHILD

ADVANTAGE


Endowment.

Min Max Matures when the child reaches the age o 10-30 Years.


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Term or 24. Premium paid till child reaches

18.

Min Max

Age of Child


Min Max

Age of Parent

20-50 Years. -

Payment

Modes

All regular premiums. All regular premiums.

Life AssuredChild is insured. But premium waiver

rider available for parent.

Parent.

Beneficiary Child Child.

Flexibility in

benefit

structure

2 structures :

1. Money is paid on the 18 th, 19 th, 20 th

and 21 st year (20%+25%+25%+35%)

One structure only.

Lump sum payment

made on maturity

which consists of SA


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2. Money is paid on the 18 t , 20 t , 22n or

24 th year (25%+25%+25%+40%).

or accumulated

bonuses, whichever is

higher.

Benefit-

Death of

Parent

None if premium waiver rider is not

purchased.

If the child is 18(then

Sa or Accumulation

paid, whichever is

higher. Else total

premium or SV is paid

whichever is higher).

Benefit-

Death of

Child

< 7 years Premiums

refunded without interest >7

years &


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Years SA + Bonus > 18 years

Outstanding payments as a lump sum

Bonus &

Additions

Not guaranteed. Paid after the end of

premium paying term. Not guaranteed.

Riders

available

Family Income Rider/ Premium Waiver

Rider.

ADBR, WOP.

Surrender

Value

Available after 3 premium paying years. Available.


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CHILD CARE Vs TATA AIG EDUCARE (18 YEARS)

FEATURESSMART KID TATA AIG EDUCARE


Regular premium

endowment plan-

Positioned as a Child

Plan.

Min Max

Term

Matures when the child reaches the

Age of 21 or 24. Premium paid till

Child reaches age 18.

Matures when the child is

18 years of age.

Min Max

Age of Child

0-13 Years. 30 days to 8 years of age.

Min Max

Age of

Parent

20-50 Years. Not applicable.


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Payment

Modes

All regular premiums. All.

Life Assured

Child is insured. But premium


parent.

Child- till the child

reaches the age 18 , the

parent will be the

policyholder. At 18, the

policy will be transferred

in the childs name.

Beneficiary Child Child.

Flexibility in

benefit

structure

2 structures :

1. Money is paid on the 18 th, 19th,

20th and 21st

year

20%+25%+25%+35%)

2. Money is paid on the 18 th, 20 th, 2

or

24 th year (25%+25%+25%+40%)

Single payment structure.


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Benefit-

Death of

Parent

None if premium waiver rider is

purchased.

Policy lapses in case payer

benefit rider is not opted

for.

Benefit-

Death of

Child

< 7 years Premiums

refunded without

interest >7 years & 18 years

Outstanding payments as a lump su

The proceeds are paid to

the parent.

Bonus &

Additions

Not guaranteed. Paid after the

End of the premium paying term.

Guaranteed 10% of SA

paid at maturity or death

provided the policy has

been in force for 10 years.

Plus a guaranteed


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education benefit of 20%

of the SA paid at the

maturity.

Riders

available

Family Income Rider/ Premi

Waiver Rider.

Payor Benefit Rider-

premium waiver.

Surrender

Value

Available after 3 premium paying

years.

30% of the premiums

paid(excluding the 1 st

premium & extra premium

, if any) provided 3 annual

premiums have been paid

in full.


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OBJECTIVE

Working of the unit-linked plans.

Comparative analysis of the life insurance products available in the

market.

Research methodology used : Primary data collected by visiting the

leading life insurance companies like LIC, ICICI Prudential, Aviva,

Birla Sun Life Insurance, HDFC Standard Life, Tata AIG Educare,

OM KOTAK Mahindra.

Data Collection:

(a) Questionnaires filled by various income groups.

(b) Internet (by searching about the investment plans of other

companies).

Action plan:

(a) Firstly, collecting information from newspapers & magazines

like Economic Times, Financial Express, Business India, The

Times Of India, Internet.

(b) Secondly, getting the questionnaires filled (about 50) to find out

which company they prefer for life insurance policies, what are the

specific features of their policies, whether they treat insurance as

an investment option or a security option.


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Finally, analyzing the data collected and comparing the insurance

companies to show the market credibility of BAJAJ Allianz among other

private life insurance companies.


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SOURCES OF DATA

PRIMARY DATA

Questionnaires.

In depth interviews with the agents and managers of private life

insurance companies.

SECONDARY SOURCES

Newspapers.

Magazines.

Internet sites.


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DATA COLLECTION

PRIMARY DATA

The primary data are those data which are collected afresh and for the first

time and happen to be original in character. The primary data to be

collected for the study are-

By Structured Questionnaire (Customer)

SECONDARY DATA

Secondary data are those data which have already been collected by

someone else and which already had been passed through the statically

process. The secondary data to be collected for the study are-

Publication of the company

Periodical of the company

By Internet Websites

RESEARCH INSTRUMENT

STRUCTURED QUESTIONNAIRE:

A Questionnaire consist of a number of questions printed or typed and a

definite order on a form or set of forms. It is the set of questions presented

to the retailers for their answers. When the questions have only two


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alternatives or of multiple choice, then it is known as closed-end

questionnaire, which is hence used the given study.


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SAMPLE AND SAMPLE SIZE:

In project I choose a finite population that is I chose a fixed number of

elements (persons) so that it is possible to enumerate it in its totality. For

instance, the population of the MEERUT region.

From that population I made a sampling frame which consists of a list

of items from which the sample is to be drawn. For instance, I choose that

portion from the population those who having good contacts.

From that sampling framework I choose my sample size. I choose 150

people as the size of the sample. From these sample size more than 140

people was responded. Following depicts all these analysis


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The all notation stands for:

1. Implies response,

2. Implies sample.

3. Implies sampling frame.

4. Implies population.

The gap between the response and sample is known as response error.

The gap between the sample and sampling frame is known-as chance error.

The gap between the sampling frame and population is known as frame

error.

DATA COLLECTION METHOD:

I have used my own database which consisted of student , shop

keepers etc, Serviceman, retired person from reputed organization etc.

After having all these I used to analyze the profile of those person

and go forward to meet them individual. In my case what I had

proceed on

behalf of the company, the list of given data base exhibit the following

two aspects:


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FINDINGS AND ANALYSIS

There were about 10 questions in the questionnaire on the basis of which

the findings were done and the analysis was made. The responses to the

questions in the questionnaire are presented in the form of statistical tools

such as pie charts and bar charts. There were 50 people being interviewed

from different income groups and age groups.

1. Do you have a life insurance policy? If yes, then of which

company/companies?

72%

28%

PEOPLE HAVING INSURANCE POLICIES

Yes

No

28%

33%

8%

17%

3%5%

6%

0%

% OF INSURED POPULATION IN VARIOUSCOMPANIES

Bajaj Allianz

LIC

Max Newyork

ICICI Pru

TATA AIG

Birla sun life

AVIVA


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Out of the 50 insurable people interviewed nearly 72% people have taken

insurance policy. Out of this population being interviewed nearly 32 % had

LIC policy, 28 % had Reliance Life, followed by ICICI Pru. (17 %), Max

New York Life (8 %) , TATA AIG(3%), Birla Sun Life (6%), Aviva and

HDFC having 6% shares each in the interviewed population.

2. Do you see insurance policies as an investment alternative or a

security option?

22%

78%

PURPOSE OF INSURANCE

Investment Alternative

Security Option


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Out of the 50 people interviewed 78 % people term/see insurance policy as

a security option while only 22 % see it as an investment option.


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3.Please rank the following as per your preference to investment in

a financial year:

Out of 50 being interviewed, 18 people invest in life insurance policies, 16

people invest in shares, 12 people invest in mutual funds and 4 people

invest in government bonds.

02

468

101214161820

Shares Mutual Funds Life insurance Government Bonds

( N o .

o f p e o p

l e )

(Investment alternatives)

INVESTMENT PREFERENCES IN VARIOUS ALTERNATIVES


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4.What is your criteria/criterion to select a particular insurance

company and a scheme?

Out of 50 people being interviewed, 15 people select an insurance

company on the criterion of security, 5 people select an insurance

company on the criterion of time span, 2 people select an insurance

company on the criterion of market share, 8 people select an insurance

company on the basis of return and 20 people select an insurance

company on the basis of all the above mentioned reasons.

0

5

10

15

20

Security Time span Market share Return All of theabove

15

5

2

8

20

CRITERIA FOR SELECTING AN INSURANCECOMPANY


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5. Rank the life insurance companies in the your order of

preference :

Out of 50 people interviewed, 46% had Reliance Life as their first

preference for a pvt. Life insurance company followed by ICICI

Prudential having 24 % preference followed by HDFC Life insurance

having 16% market share and lastly Max New York Life Insurnce .

46%

24%

14%16%

FIRST PREFERENCE OF PEOPLE AMONG PVT. LIFE INSURANCE COMPANIES

BAJAJ Allianz

ICICI Prudential

Max Newyork

HDFC


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6. Do you think that private life insurance companies are as safe as

LIC for taking a policy?

Out of 50 people being interviewed, 62 % of people do not find

private life insurance companies to be safe for buying a life insurance

policy whereas 38 % people find them safe for buying a life insurance

policy from a private life insurance company.

Yes38%

No62%

PERCEPTION OF PEOPLE ABOUT SAFETYNESS : LIC Vs PVT. LIFEINSURANCE COMPANIES

Yes No


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7. Reliance Life is quite a famous company because:

Out of 50 people interviewed, 16 % people perceive policies of

Reliance Life make it a famous company while 20% think it is due to

the parent companies, 24% take it as marketing and advertising

strategies which appeal to the mass population while 40 % think it is

all due to the above mentioned reasons that RELIANCE LIFE is a

famous company.

16%

20%

24%

40%

FAMOUSNESS REASONS OF BAJAJ ALLIANZ

POLICIES

PARENT COMPANIES

MKTG. AND ADV. STRATEGIES

All OF THE ABOVE


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8. Are you satisfied with your existing policy/policies?

Out of 50 interviewed, 69% of the people were satisfied with their life

insurance policies while only 31% of people were not satisfied.

Satisfied69%

Not satisfied31%

SATISFACTION LEVEL OF POLICY HOLDERS

Satisfied

Not satisfied


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ANALYSIS

Analysis of a research project is based on the primary data and

secondary data which is being collected from various sources to take

out some conclusions of the research study being taken. In my

project my purpose was to find the market credibility of Reliance

Life among various other private life insurance companies. For this

a population of 50 people was being interviewed having different

lifestyles, different incomes, different occupations yet the point

which was kept in mind was that this interviewed population was

insurable.

The questionnaire filled up by people revealed that nearly 36

people i.e. about 72% people have life insurance policies. This is

due to the fact that people now have started realizing that life is

very uncertain and it is advisable to have a life insurance policy.

Nearly, 24 % people had LIC policy and 20% people have

Reliance Life as their life insurance policy. The reason that people

have more LIC policy is that it is an old company for life insurance

and secondly it is a government controlled organization. Secondly,


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when enquired about the perception of people about insurance

policies, nearly 39 people i.e. about 78% people see it as a security

option for their families financially so that if they are not alive

some day, their family does not go in vain. While 11 people i.e.

about 22% people see it an investment option to save taxes and get

returns. Thirdly, when asked about their investments in various

alternatives, 18 people gave life insurance policies their first

preference for investment whereas 16 gave shares as their first

preference followed by mutual funds (12) and lastly government

bonds. This clearly shows that people are risk averse to a large

extent as largest numbers of people like to invest in life insurance

policies to make sure that there is security. Fourthly, when they

were asked about the criterion of choosing a life insurance

company 15 people replied that they see the security point of view

to buy a life insurance company. 5 people chose time span as the

criteria to choose a life insurance company. 2 people chose the

market share of the company as the preferred criteria of choosing

the life insurance company. 8 people chose the returns of life

insurance companies as the criteria for choosing a life insurance


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company. Nearly, 20 people chose all the above mentioned reasons

to choose a life insurance company.

When the sample population was interviewed about their 1 st

preference among the pvt. Players, nearly 46 % people chose

Reliance Life as the 1 st insurance company, 24 % people chose

ICICI Prudential as the 1st

preference, and 16 % chose HDFC as

the 1 st insurance company and 14 % people chose Birla Sun life as

the 1 st preferred company. When sample size was asked about

safety ness of an insurance policy as compared to LIC policy

nearly 62 % people replied that they do not find private life

insurance companies as safe as LIC, this is due to the fact that LIC

had monopoly into life insurance till 2000. Only after 2000, private

companies have come in the field of Life Insurance Company.

Proceeding further, when sample population was asked to

recognize the punch line of Reliance Life nearly 60 % of the

population was able to recognize the punch line of Reliance Life

which clearly indicates that Reliance Life is a well known life

insurance company among the people. Followed by it, when

sample size was interviewed about the reasons of famousness of


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Reliance Life 16 % of people chose its policies as the reason for its

famousness, 20% people chose its parent companies as the reason

for its popularity, 24 % agreed for its marketing and advertising

strategies to be the prime cause of its popularity among masses.

Whereas 40 % population agreed to all of the above mentioned

reasons to be causes of the popularity of Reliance Life. When

asked about the satisfaction with the existing insurance policies

nearly 69% people said that they are satisfied with their policy

whereas only 31% people were not satisfied with their policy.

They wanted the additional features of transparency about the

returns after when they have stopped paying the premiums. Also

they wanted higher rate of returns at the end of payment of

premiums.


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DIFFICULTIES FACED

Following were the difficulties faced during the completion of

project:

Non filling up of certain questions of the questionnaire which led to

the cancellation of that particular questionnaire.

Non understanding of certain parameters in the questionnaire.

Taking a sample size of 50 people does not reflect the mindset of all

kinds of people from different backgrounds, different age groups

and income groups.

Again research study of 2 months is a time constraint and covering

whole of Delhi population by taking a sample size of 50 is not

feasible.


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FUTURE GROWTH & SUGGESTIONS

RELIANCE LIFE, in the present scenario is growing at an aggressive

pace. The company does a lot of survey & analysis in the market to

discover customers needs & expectations & tries to improvise on its

existing market linked plans along with insurance policies. In addition to

this , the company from time to time keeps on introducing various new

policies & tailor made plans exclusively to cater peoples financial needs.

This has enabled Reliance Life to become market leader in the sector of

insurance & investment companies since 2001 when it came into

existence.

Since, now many other companies are joining the field of insurance &

investments, it will be necessary for Reliance Life to vigorously pursue &

update its survey & analysis policy to remain market leader.

Simultaneously, it should discover & rediscover its strength by introducing

new plans better suited to the people at large. India is a very big market &

it can provide sustenance to all the companies in the field of insurance &

investments but to remain one of the leading companies, Reliance Life has

to adopt new strategies earlier than others. This could include widening the

distribution networks to all parts of the country & catering to every income

group. Furthermore, it can improvise on its advertisements & promotion

campaigns by becoming more appealing & making them touches the hearts


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of millions & billions of Indians who are the hot prospects. Lastly, the

students in the professional courses, apprentices, trainees may be good

targets to approach in times ahead.


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CONCLUSION

The research project titled as COMPARITIVE ANALYSIS OF

RELIANCE LIFE AMONG OTHER LIFE INSURANCE

COMPANIES enabled to understand the competition among the various

life insurance companies which have entered Indian market of life

insurance after 2000 when private life insurance companies were allowed

to enter the Life insurance sector in India. Reliance Life is one of the

companies in the private sector which are doing exceptionally good in this

sector due to their policies to which people find very attracting accordingto their needs. When people were interviewed about the first preference

among the private life insurance companies nearly 46% replied for

Reliance Life, this clearly indicates that Reliance Life is quite a household

name. The reasons for this are many like it is a company with very strong

brand names: BAJAJ Auto Limited which is the no. 1 Automotive

Manufacturer in India also Allianz AG is 3 rd largest life insurance

company in the world. The market share of Reliance Life also around 34%

among private life insurance companies which is quite high among private

life insurance companies. It is only second to LIC in the life insurance

sector.


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BIBLIOGRAPHY

Philip Kotlar, Marketing Management, New Delhi, Pearson

Education (P) Ltd., Indian Branch, 2004.

C.R. Kothari, research Methodology, New Delhi, New Age

International (P) Ltd.

WEBSITES

www.icicilife.com

www.lic.gov.in

www.hdfc.com

www.kotak.com

www.birlasunlife.com

www aviva com
http://www.lic.gov.in/http://www.lic.gov.in/http://www.hdfc.com/http://www.hdfc.com/http://www.kotak.com/http://www.kotak.com/http://www.birlasunlife.com/http://www.birlasunlife.com/http://www.aviva.com/http://www.aviva.com/http://www.aviva.com/http://www.birlasunlife.com/http://www.kotak.com/http://www.hdfc.com/http://www.lic.gov.in/

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