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ANALYSIS OF SALES OF IDBI FEDERAL LIFE
INSURANCE CO. LTD.
PREPARED BY
SANGEETHA VENUGOPAL P.
1
TABLE OF CONTENTS
SL NO. CHAPTERS PAGE NO
1 INTRODUCTION 1
2 REVIEW OF LITERATURE 5
3 THEORETICAL FRAMEWORK 7
4 INDUSTRIAL PROFILE 11
5 ORGANISATIONAL PROFILE 14
6 ANALYSIS 35
7 FINDINGS 55
8 SUGGESTIONS 57
2
LIST OF TABLES
Sl.No. Table No. Table Name Page No.
1 6.1 Sales for the year 2011
36
2 6.2 Sales for the year 2010
38
3 6.3 Sales for the year 2009
39
4 6.4 Insurance Coverage 40
5 6.5 Insurance policy ownership
41
6 6.6 The policy which is owned by sample population
42
7 6.7 The type of communication
43
8 6.8 Awareness of company products
44
9 6.9 The source of awareness of products
45
10 6.10 Reason for taking insurance policy
46
11 6.11 Matching of Requirements
47
12 6.12 Most suitable product 48
13 6.13 Suggested Product 49
14 6.14 Response from the meeting
50
15 6.15 Satisfaction with Incomesurance
51
16 6.16 Best feature 52
17 6.17 Decision to purchase IDBI Federal product
53
18 6.18 Decision to buy ‘Incomesurance’
54
3
LIST OF CHARTS
Sl.No. Chart No. Chart Name Page No.
1 6.1 Sales for the year 2011
36
2 6.2 Sales for the year 2010
38
3 6.3 Sales for the year 2009
39
4 6.4 Insurance Coverage 40
5 6.5 Insurance policy ownership
41
6 6.6 The policy which is owned by sample population
42
7 6.7 The type of communication
43
8 6.8 Awareness of company products
44
9 6.9 The source of awareness of products
45
10 6.10 Reason for taking insurance policy
46
11 6.11 Matching of Requirements
47
12 6.12 Most suitable product 48
13 6.13 Suggested Product 49
14 6.14 Response from the meeting
50
15 6.15 Satisfaction with Incomesurance
51
16 6.16 Best feature 52
17 6.17 Decision to purchase IDBI Federal product
53
18 6.18 Decision to buy ‘Incomesurance’
54
4
CHAPTER-I
INTRODUCTION
5
INTRODUCTION
Insurance is a social device whereby a large group of individuals, through a system
of equitable contributions, may reduce or eliminate measureable risk of economic
loss common to all members of the group. It is a financial agreement that spreads
the costs of losses among the members of an insurance pool. “Insurance is a
contract by which one party for the consideration called premium, assures a
particular risk of the other party and promises to pay to him or his nominee, a
certain or ascertainable sum of amount on a specified contingency”.
With such a large population and the untapped market area of this population,
Insurance happens to be a very big opportunity in India. Today it stands as a
business growing at the rate of 15-20% annually. Together with banking services,
it adds about 7% to the country’s GDP. In spite of all this growth the statistics of
the penetration of the insurance in the country is very poor. Nearly 80% of Indian
populations are without Life insurance cover and the Health insurance. This is an
indicator that growth potential for the insurance sector is immense in India. It was
due to this immense growth that the regulations were introduced in the insurance
sector and in continuation “Malhotra Committee” was constituted by the
government in 1993 to examine the various aspects of the industry. The key
element of the reform process was Participation of overseas insurance companies
with 26% capital. Creating a more efficient and competitive financial system
suitable for the requirements of the economy was the main idea behind this reform.
Since then the insurance industry has gone through many sea changes. The
competition LIC started facing from these companies were threatening to the
existence of LIC. Since the liberalization of the industry the insurance industry has
6
never looked back and today stand as the one of the most competitive and
exploring industry in India. The entry of the private players and the increased use
of the new distribution are in the limelight today. The use of new distribution
techniques and the IT tools has increased the scope of the industry in the longer
run.
IDBI Federal Life Insurance Co Ltd is one of the major players in Indian
insurance market. It is a joint-venture of IDBI Bank, India’s premier development
and commercial bank, Federal Bank, one of India’s leading private sector banks
and Ageas, a multinational insurance giant based out of Europe. In this venture,
IDBI Bank owns 48% equity while Federal Bank and Ageas own 26% equity each.
At IDBI Federal, we endeavor to deliver products that provide value and
convenience to the customer. Through a continuous process of innovation in
product and service delivery we intend to deliver world-class wealth management,
protection and retirement solutions to Indian customers. Having started in March
2008, in just five months of inception we became one of the fastest growing new
insurance companies to garner Rs 100 Cr in premiums. The company offers its
services through a vast nationwide network across the branches of IDBI Bank and
Federal Bank in addition to a sizeable network of advisors and partners. As on 31st
March, 2012, the company has issued over 3.76 lakhs policies with over 21,578 Cr
in Sum Assured.
The scope of insurance business in India has been clearly understood by both
foreign and Indian companies. IDBI bank has joined with Federal bank and with
the help of an international company like ageas started “IDBI Federal Life
Insurance Company” for introducing the majority of Indian population to
insurance. And this study is to understand the sales of insurance products in its
thrissur branch.
7
SIGNIFICANCE OF THE STUDY
The study is of significance because there was a great difference in the sales of
various products of the company.
STATEMENT OF PROBLEM
To understand and study the sales level and the difference in sales level of IDBI
Federal Life Insurance Products with the past 3 years data.
OBJECTIVES OF THE STUDY
PRIMARY OBJECTIVES ARE:
To understand various products sold by the company.
To get a clear picture on how the agency channel of an insurance company
works.
To know the various promotional and marketing activities carried out by
the organisation.
SECONDARY OBJECTIVES ARE:
To gain an insight about the company.
To know the vision, mission, values and policies of the organisation.
METHODOLOGY
Data was collected from various primary and secondary sources. Primary source
includes various employees who provided valuable information regarding the
organization and its working. Secondary data was collected mainly from the
official website of IDBI Federal and from the booklet issued by the company along
with a training cell named ‘Catalyst’. Various textbooks and e-magazines were
8
also referred. Pie diagrams are used for the pictorial representations of data
collected from the organization.
SCOPE OF THE STUDY
The study is limited to the Thrissur branch of “IDBI federal Life Insurance Co.”
The customers are the people from mid- Kerala especially from Thrissur district.
LIMITATIONS OF THE STUDY
The study was restricted to a single branch of the company.
The study is made based on available information, it may not be
authentic.
Time constraint was a limitation of the study.
Employees were not able to provide much help due to their work.
CHAPTERISATION
The first chapter deals with the introduction to the insurance industry along with
the introduction to the IDBI Federal Life Insurance Company. The second
chapter contains literature review which is the details for various projects already
conducted by students of various institutions. Third chapter is the theoretical
framework of the insurance industry. Chapter four consists of the profile of
insurance industry with details of giant insurance providers. Fifth chapter deals
with the organizational profile of IDBI Federal Life Insurance Company with
special reference to its Thrissur branch. Chapter six contains the analysis and
chapter seven and chapter eight deals with findings and suggestions respectively.
9
CHAPTER – II
REVIEW OF
LITERATURE
10
REVIEW OF LITERATURE
A summer training project titled “Marketing Strategies of IDBI life insurance”
done by Ms. Varsha Garg, a final year BBA student mentioned the following.
“Still today people think that Insurance does not give good returns. They are not
aware of the modern Unit Linked Insurance Plans which are offered by most of the
Private sector players. They are still under the perception that if they take
Insurance they will get only 5-6% returns. Nowadays most of the modern Unit
Linked Insurance Plans gives returns which are many times more than that of bank
Fixed deposits, National saving certificate, and PPF.
People still today are not aware about the earning opportunity that the Insurance
sector gives. Companies in order to beat the competition and to increase their
Insurance Advisors and increase their reach to the customers are giving very high
commission but people are not aware of that.”
A project report titled “Buying behavior of Customers in Insurance Sector”
prepared by Mr. Shahabas Moidu, a PGDM student of DCSMAT, Wagamon
clearly shows with evidence that most of the people mainly prefer bank deposits as
a strong investment option followed by mutual funds and other financial products.
The report also says that majority of prospective customers are willing to take up
insurance policy of LIC rather than any other private insurance players.
A report prepared by Mrs. Meena K an employee of IDBI Federal Life Insurance
Company says “With the consent of the company, the agency channel has decided
11
to promote more guaranteed return products rather than products which are
subjected to market risks. The reason behind such a decision was the customer
dissatisfaction rise during the last year (2011).”
Abhishek Roy, a student of Sinhgad Institute of Management College, Pune has
mentioned in his report, “The main goal of the marketing communication for IDBI
Federal is to bring people’s attention on products and their services by providing
them with the information that encourages a positive or buying response and also
marketing communication tool which target customers at the end to bring sales to
the company.”
A project report on branding influence in market communication summer
internship IDBI Federal Life Insurance Co. by Ms. Sameena Nikhat states that,
“The key competitors are LIC, HDFC Standard, ICICI Prudential and Bajaj
Allianz… The company offers its services through a vast nationwide network
across the branches of IDBI Bank and Federal Bank in addition to a sizeable
network of advisors and partners. As on January 31st 2011, the company has
issued over 2.68 lakh policies with over Rs 14, 230 Cr in Sum Assured.”
Various people have studied various aspects of this organization. The reason
behind the change in sales level of insurance products in the past three years in the
thrissur branch of the company is being studied by me.
12
CHAPTER – III
THEORETICAL FRAMEWORK
OF INSURANCE COMPANIES
13
THEORETICAL FRAMEWORK OF
INSURANCE COMPANIES
The Indian Life Insurance company act 1912 was the first statutory body that
started to regulate the life insurance business in India. By 1956 about 154 Indian,
16 foreign and 75 provident firms were been established in India. Then the central
government took over these companies and as a result the LIC was formed. Since
then LIC has worked towards spreading life insurance and building a wide network
across the length and the breath of the country. After the liberalization the entrance
of foreign players has added to the competition in the market.
Insurance Sector Reforms In 1993, Malhotra Committee, headed by former
Finance Secretary and RBI Governor was formed to evaluate the Indian insurance
industry and give its recommendations. The committee came up with the following
major provisions
Private Companies with a minimum paid up capital of Rs.1bn should be
allowed to enter the industry.
Foreign companies may be allowed to enter the industry in collaboration
with the domestic companies.
Only one State Level Life Insurance Company should be allowed to operate
in each state.
It was after this committee came into effect the regulatory body for insurance
sector was formed with the name of IRDA.
Insurance Regulatory and D evelopment Authority (IR DA):
14
The IRDA since its incorporation as a statutory 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.
IMPACT OF LIBERALIZATION
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 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
63.95 %(2010-11) and now it is further decreasing.
THE WORKING OF INSURANCE COMPANY
Profit = Earned Premium + Investment Income - Incurred Loss -
Underwriting expenses
Insurers make money in two ways:
15
1. Through Underwriting, the processes by which insurers select the risks to
insure and decide how much in premiums to charge for accepting those
risks, and
2. By investing the premiums they collect from insured.
Revenue = Premium
Expenses = (Sum of Claims + Commission payable on
procurement of business + Operating expenses)
Operating Surplus = (Revenue - Expenses)
Net investment income includes income from trading in and holding stock market
securities including government securities, special deposits with the central
government, loans to several public utilities and service providers in state
government. Insurance premium collected is converted in a pool of fund then
divided in to four expenses:
To pay the expenses of the management
To pay agency commission
To pay for the claims
Surplus money will be invested in government securities
CURRENT SCENARIO OF THE INDUSTRY
16
India with about 200 million middle class household shows a huge untapped
potential for players in the insurance industry. Saturation 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 private sector that
are providing them new products and variety for their choice. Life insurance
industry is waiting for a big growth as many Indian and foreign companies are
waiting in the line for the green signal to start their operations. The Indian
consumer should be ready now because the market is going to give them an array
of products, different in price, features and benefits. How the customer is going to
make his choice will determine the future of the industry. The private insurance
players have significantly improving their market share when compared to 50 years
Old Corporation (i.e. LIC).
INVESTMENT IN LIFE INSURANCE
Life insurance policies are "cash value," which means the fees, or premium,
initially are greater at the start of the policy than they would be in a term policy.
The excess premium is then invested in a "separate account," either by the insurer
or in an account controlled by the policy holder, building up cash value. Any
investment gains can be used in a few ways: to increase the death benefit, to
borrow against for any use or to keep the policy in effect if insured stop paying
monthly premiums.
17
CHAPTER IV
INDUSTRIAL PROFILEINDUSTRIAL PROFILE
Insurance is a nascent sector in India providing a wide potential for the players worldwide. The premiums of life insurance accounts to about 2.5 % of India's GDP while the premiums of the general insurance accounts to about 0.65% GDP. In India the Insurance sector went through a number of changes when the Indian Government allowed the private companies to solicit insurance by allowing FDI up to 265%.The Indian Insurance scenario received a boost up as the global insurance companies are craving for a lion's share. The Insurance Companies like LIC, Bajaj Alliance, ICICI Prudential are booming in this era. The list below will give the names of the best Insurance Companies of India.
List of Top Insurance Companies of India
Life Insurance Corporation of India :This leading Insurance Company of India was established in the year 1956 by the alliance of 16 non-Indian companies, 154 Indian Insurance Companies and 75 provident. It has 100 divisional offices, 2048 computerized branches, 7 zonal offices and the company's corporate office. It has introduced new strategies for the facilitation of the customers like the IVRS,ECS,ATM Premium payment facility and the company's Info centers in Mumbai, Delhi, Chennai, Kolkata and many others cities.
Bajaj Allianz:This Indian Insurance company is a joint venture of Alliance AG, which is one among the largest Life Insurance companies and Bajaj Auto, one among the biggest 2- & 3 wheeler producers in the world. The Company has various plans for the customers like the Pension, Retirement, Life Time Care,
18
Health Care, Life Insurance Online, Life Insurance Saving Plans, and online services like the Address change, Renewal Premium Payment etc.
Tata AIG Life :This renowned life Insurance company in India offers a wide array of products related to life insurance for associations, individuals and businesses. The company offers high quality solutions to its corporate Indian clients. It renders services like the AIG Health First, AIG Health Life Protector, Tata AIG Life Hospi Cash Back, Tata AIG Life Maha Gold, Tata AIG Life Assure 10 Years and many others. The company is a joint venture of America International Group and TATA group. Birla Sun Life Insurance:It is one of the major insurance companies in India and a joint venture of Sun Life Financials and Aditya Birla group. The company provides Life Insurance Solutions to meet the needs of Protection, Retirement and Saving .It has recently launched the Money back Plus Plan.
SBI Life :This renders premium Insurance solutions like SBI Life-Smart ULIP, SBI Life-Group Criti9, SBI Life-Unit Plus Child Plan etc. It also offers services like the NRI services, Premium Payment Procedure, ECS Facility, RPI/RFI and many others. SBI Life is a joint venture of BNP Paribas Assurance and SBI.
Max New York Life:This Life Insurance company in India provides the best solutions related to life insurance like children's plan, retirement solution, Investment, Protection, Health, Savings etc. The company has 14 corporate agency tie ups, 33 bankassurance relationships and direct sales force at 14 locations. It is now covering 36 products related to life and health insurance.
Kotak Life Insurance:This premier Insurance company in India offers insurance facilities related to Savings, Investments, Child, Retirement, Protection, Kotak Long Life Secure Plus, Kotak Long Life Health Plus etc. It opens up services like Insurance Guide, NAV, Premium Payment Options and many others.
HDFC Standard Life:This is one of the major market leaders in the insurance sector in India. The company offers Insurance services like the Group Plans, Health Plans, Protection Plans, Retirement Plans, Savings and Investment Plans etc. The customer base of the company is about more than 7 million who depend on the company for various needs.
19
Reliance Life :The company based in India offers the best plans for Life Insurance in India. Reliance Capital Limited's associate company is Reliance Life which is one of the leading private sectors in India. The company provides the Protection Plans, Child Plans, Retirement Plans and Investment plans and is also the ultimate solver of solutions.ICICI Prudential:This major Insurance Company in India provides health Insurance, life insurance, ULIPs, ULIP, Retirement Plans and many others. Life Insurance Plans of the company covers Premium Guarantee Plans, Education Insurance Plans etc. Pension Plans encompass LifeStage Pension, Forever Life. Health Insurance Plans cover Hospital Care, MediAssure.
CHAPTER - V
ORGANISATIONAL PROFILE
20
COMPANY PROFILE
IDBI Federal Life Insurance Co Ltd is a joint-venture of IDBI Bank, India’s
premier development and commercial bank, Federal Bank, one of India’s leading
private sector banks and Ageas, a multinational insurance giant based out of
Europe. In this venture, IDBI Bank owns 48% equity while Federal Bank and
Ageas own 26% equity each. At IDBI Federal, we endeavor to deliver products
that provide value and convenience to the customer. Through a continuous process
of innovation in product and service delivery we intend to deliver world-class
wealth management, protection and retirement solutions to Indian customers.
Having started in March 2008, in just five months of inception we became one of
the fastest growing new insurance companies to garner Rs 100 Cr in premiums.
The company offers its services through a vast nationwide network across the
branches of IDBI Bank and Federal Bank in addition to a sizeable network of
advisors and partners. As on 31st March, 2012, the company has issued over 3.76
lakhs policies with over 21,578 Cr in Sum Assured.
Management:
21
GV Nageswara Rao is the MD & CEO of IDBI Federal Life Insurance.
Aneesh Srivastava is the CIO of IDBI Federal Life Insurance.
Michael J Wood is the appointed actuary of IDBI Federal Life Insurance
The sponsors of IDBI Federal Life Insurance Co Ltd.
=
IDBI Bank Ltd. continues to be, since its inception, India’s premier industrial
development bank. It came into being as on July 01, 1964 (under the Companies
Act, 1956) to support India’s industrial backbone. Today, it is amongst India’s
foremost commercial banks, with a wide range of innovative products and services,
serving retail and corporate customers in all corners of the country from 977
branches and 1544 ATMs. The Bank offers its customers an extensive range of
diversified services including project financing, term lending, working capital
facilities, lease finance, venture capital, loan syndication, corporate advisory
services and legal and technical advisory services to its corporate clients as well as
22
mortgages and personal loans to its retail clients. As part of its development
activities, IDBI Bank has been instrumental in sponsoring the development of key
institutions involved in India’s financial sector –National Stock Exchange of India
Limited (NSE) and National Securities Depository Ltd, SHCIL (Stock Holding
Corporation of India Ltd), CARE (Credit Analysis and Research Ltd).
Federal Bank is one of India’s leading private sector banks, with a dominant
presence in the state of Kerala. It has a strong network of over 950 branches and
1002 ATMs spread across India. The bank provides over four million retail
customers with a wide variety of financial products. Federal Bank is one of the first
large Indian banks to have an entirely automated and interconnected branch
network. In addition to interconnected branches and ATMs, the Bank has a wide
range of services like Internet Banking, Mobile Banking, Tele Banking and Any
Where Banking, debit cards, online bill payment and call centre facilities to offer
round the clock banking convenience to its customers. The Bank has been a
pioneer in providing innovative technological solutions to its customers and the
Bank_has_won_several_awards.
Ageas is an international insurance company with a heritage spanning more than
180 years. Ranked among the top 20 insurance companies in Europe, Ageas has
chosen to concentrate its business activities in Europe and Asia, which together
make up the largest share of the global insurance market. These are grouped
around four segments: Belgium, United Kingdom, Continental Europe and Asia
and served through a combination of wholly owned subsidiaries and partnerships
with strong financial institutions and key distributors around the world. Ageas
operates successful partnerships in Belgium, UK, Luxembourg, Italy, Portugal,
23
Turkey, China, Malaysia, India and Thailand and has subsidiaries in France,
Germany, Hong Kong and UK. It is the market leader in Belgium for individual
life and employee benefits, as well as a leading non-life player, through AG
Insurance, and in the UK, it has a strong presence as the third largest player in
private car insurance and the over 50’s market. It employs more than 13,000
people and has annual inflows of more than EUR 17billion.
VISION:
To be the leading provider of wealth management, protection and recruitment
solutions that meets the needs of the customers and adds values to their lives.
MISSION:
To continually strive to enhance customer experience through innovative
product offerings, dedicated relationship management and superior service
delivery while striving to interact with the customers in the most convenient
and most cost effective manner.
To be transparent with the customers and to act with integrity.
To invest in and build quality human capital in order to achieve our mission.
VALUES
Transparency
Value to customers
Financial strength
24
Delivery on Promise
Customer friendly
Profit to Shareholders
At IDBI Federal Life Insurance Co. Ltd., the Endeavour is to deliver products that
provide value and convenience to the customer. Through a continuous process of
innovation in product and service delivery, the intent is to deliver world class
wealth management, protection and retirement solutions to Indian customers.
TRACK RECORD
India’s fastest growing life insurance company with Pan India presence.
Modal premium Rs.316 crores in the first year of operation.
Above Rs.3000 crores of sum assured, 90000 policies and 7000 distributors.
Moved into 13th position from 18th as on 31st March 2009.
Fastest Rs.100 crores and fastest Rs.300 crores business targets met since
inception.
Funds performing in the top quartile consistently.
Achieved one of the lowest cost ratios in the industry.
PRODUCTS OFFERED BY IDBI FEDERAL LIFE INSURANCE CO. LTD.
Childsurance
Lifesurance
Wealthsurance
Group Microsurance
Incomesurance
25
Healthsurance
Bondsurance
Homesurance
Termsurance
Loansurance
Retiresurance
IDBI Federal Life Insurance Co. Ltd. provides its services through three means.
They are: Bancassurance Channel, Agency Channel and Alliance Channel. The
Thrissur branch of IDBI Federal Life Insurance Co. Ltd. deals with plans like
childsurance, lifesurance, wealthsurance, termsurance and incomesurance.
PRODUCT PROFILE
IDBI Federal Life Insurance Product Table
Retirement/Pension Plan Retiresurance
Term Plan Termsurance
Savings & Investment Plan Wealthsurance
Savings & Investment Plan Bondsurance
Savings & Investment Plan Incomesurance
Health Plan Healthsurance
PRODUCTS IN DETAIL
Childsurance:
26
IDBI federal’s childsurance is for the parents who are looking to make their child’s
future shock-proof is its powerful insurance benefits. Childsurance allows to you to
protect your child plan with triple insurance benefits so that your wealth-building
plan remains unaffected by unforeseen events and your child future remains
secure.
IDBI Federal Childsurance® Dreambuilder Insurance Plan is a Unit linked plan
which is loaded with lots of benefits which will help you to build, create and
manage your investment with great flexibility so that your plan meets your specific
needs.
The following are the key benefits Childsurance® Dreambuilder Insurance Plan.
Contribute money in a flexible way to suit customer’s savings habit
A wide choice of investment options, based on customer’s return
expectations and risk tolerance
Investment strategy according to customer’s profile
Helps to boost customer’s savings.
Customers can decide on how to manage their investments.
Helps to secure child’s future goals
27
Tax benefits on contributions and benefits
Funds can be withdrawn in case of need, after five years
Healthsurance:
IDBI federal Healthsurance Hospitalization and surgical plan offers host of
features and benefits that is designed to help the customers to manage extra burden
that comes with hospitalization. This plan targets the customers within the age
limit of 18 years – 55 years. The following diagram shows the reasons behind why
healthsurance plan should be included in the financial plan of every individual.
BENEFITS UNDER HEALTHSURANCE
IDBI Federal Healthsurance® Hospitalization and Surgical Plan is a power packed
plan with loads of benefits that aim to keep you tension free.
Daily hospital cash benefit paid for each day (24 hours) spent in an eligible
hospital (from day 2 onwards): Rs. 500, Rs. 1,000, Rs. 1,500 or Rs. 2,000
depending on customer’s choice of benefit level
28
Higher daily hospital cash benefits of Rs 3,000 and Rs. 4,000 available,
subject to suitable proof of income
Additional daily benefit equal to the daily hospital cash benefit, from day 2
onwards for hospitalization in an Intensive Care Unit, (up to an overall
maximum daily benefit of Rs. 5,000)
Additional lump sum surgery benefit paid if customer undergo any of the
wide range of surgical procedures specified in this brochure: either 50 or 100
times customer’s chosen daily benefit, depending on the severity of the
surgery
Three times customer’s daily hospital cash benefit paid as a lump sum
convalescence benefit (maximum once per year) if customer’s hospital stay
is at least 168 continuous hours (at least 7 consecutive days)
Generous total benefit limits. Up to 500 times customer’s daily hospital cash
benefit each year; up to 2,000 times customer’s daily hospital cash benefit
over the lifetime of customer’s policy
Cover lasts until customer are aged 65 years, provided customer continue to
pay their premiums in the agreed manner and as long as their lifetime
benefits limit (2,000 times your daily hospital cash benefit) has not been
reached
Customer’s choice of nominee, to whom any outstanding benefits will be
paid, in the event of the death of the insured person
Low-cost monthly premiums that depend on customer’s age at the outset.
Customer’s premium will never increase because of any changes in their
age, health, or the number of claims they make. However, IDBI Federal Life
Insurance Co. Ltd. does reserve the right (subject to IRDA approval) to
increase premiums in the future across all its specified plans.
29
Excluded occupations under Healthsurance
Applications for cover will not be accepted from anyone working in any occupation
described below at the time of applying. In the event of a claim whilst the insured
person is active in any of these occupations, the claim will only be considered with the
provision of proof that the insured person was not working in any of these occupations
at the commencement date.
Working in confined spaces in vessels, tunnels, underground civil works, mines,
rigs (including offshore rigs) or ships
Industrial work using heavy machinery or working as a welder
Working in the agricultural sector or as a forestry worker or as timber camp
personnel
Working with toxic chemicals or explosives or in weapons manufacture or
trading, or in the demolition trade
Working in transport business (unless only doing clerical work)
Working at heights (at least 20 metres above the ground or floor level)
Working as a fireman, security guard or patrolman, or as a member of the police
force or serving in the armed forces
Lifesurance:
IDBI federal Lifesurance Plan is a saving insurance plan that helps you to
safeguard your wealth at the same time will present better opportunity to earning
better return.
KEY FEATURES OF LIFESURANCE SAVINGS INSURANCE PLAN
30
Maturity Benefit
On the maturity of your Lifesurance policy, provided all premiums have been paid
in full when due we will pay you the sum insured along with the vested guaranteed
additions, vested reversionary bonuses and terminal bonus, if any, in a lump sum.
Maturity Benefit = Sum insured + Vested guaranteed additions + Vested
reversionary bonuses + Terminal bonus
Death Benefit
On the death of the life insured during the policy term, provided all premiums have
been paid in full when due we will pay the beneficiary, the sum insured along with
the vested guaranteed additions, vested reversionary bonuses, interim bonus, if any
and terminal bonus, if any in a lump sum.
Death Benefit = Sum insured + Vested guaranteed additions + Vested reversionary
bonuses + Interim bonus (if any) + Terminal bonus
Guaranteed Additions
31
Guaranteed additions at the rate 50 per 1,000 sum insured will be added to your
policy for each full annual premium that is due and paid in the first 5 years of the
policy. In the case of premiums paid more frequently than annually, the guaranteed
additions will be added on a pro rata basis as the due premiums are paid in the first
5 years of the policy. The vested guaranteed additions will become payable along
with the sum insured at the time of a claim or maturity of the policy.
Bonuses
After the fifth policy year your Lifesurance policy will participate in any profits of
our participating policyholders’ life fund by way of reversionary bonuses and
possibly terminal bonus. The amount of any profits, and hence of any bonuses will
depend on the future experience and performance of the fund. The bonuses will be
declared by the Board of IDBI Federal Life Insurance Company each year, and
once added they will form part of the guaranteed benefits of the policy. The
Company may declare an interim bonus in the event of a claim before the next
bonus declaration. The company may also declare a terminal bonus to be paid on
maturity or death provided all the due premiums have been paid.
Tax Benefits
Deduction under Sec 80C: The premiums that you invest in Lifesurance are
eligible for deduction under Sec 80C of the Income Tax Act up to the limit
of Rs. 1, 00,000 (along with other eligible investments).
Tax-free Benefits under Sec 10(10D): The maturity benefit as well as death
benefit are tax-free under Sec 10(10D) of the Income Tax Act
There is also no tax deduction at source.
Flexible Premium Payment Term (PPT) & Policy Term (PT)
32
Policy Term: You can choose the term at the end of which you wish to receive the
maturity benefits. Lifesurance provides you the flexibility to choose between four
policy terms –10, 15, 20 or 25 years.
Premium Payment Term: You can choose the term for which you would like to
pay premiums towards your Lifesurance Plan. The minimum Premium Payment
Term is 5 years for policy terms of 15, 20 and 25 years. The minimum premium
payment term is 6 years for policy term of 10 years. The maximum Premium
Payment Term can be equal to the Policy Term. The minimum premium amount is
Rs 20,000 for annual installments, Rs 10,000 for half-yearly installments, Rs 5,000
for quarterly installments and Rs 2,500 for monthly installments.
Loans
You can avail of the loan facility from IDBI Federal after the policy acquires
surrender value. The loan amount granted will be up to 85% of the surrender value
subject to terms and conditions specified by IDBI Federal from time to time.
Advantage Women
Lifesurance offers an additional premium discount for female insured persons. The
basic premium payable for a female policyholder will be equivalent to the
premium for a corresponding three-year younger male policyholder.
Lifesurance Suvidha Savings Plan
The IDBI Federal Lifesurance Suvidha Savings Insurance Plan (hereinafter
referred to as Lifesurance) is a participating endowment plan that guarantees and
allows you to accumulate considerable savings to meet customer’s long term
responsibilities in life. Policy will participate in the surplus of the company's
participating policyholders’ life fund, and customer’s share of this surplus will be
33
added to customer policy, from the 4th policy year onwards, by way of
reversionary bonuses and a terminal bonus added at the time of maturity, or on
earlier death. As a consequence, participating policyholders who maintain their
policies till maturity will enjoy the benefits of long term debt and equity
investment while being protected from the short term volatility of the securities
markets.
Features:
Benefits at Maturity
Sum Insured along with guaranteed additions at the rate of Rs. 50 per 1,000 of the Sum Insured for the first 3 years of the policy
+
Reversionary bonuses from the 4th policy year onwards
+
Terminal bonus added at the time of maturity, or on earlier death
Plan benefits and Eligibility
1. Premiums are exclusive of service tax and education cess.
a. As per the current tax laws, service tax applicable under the policy
is 3.09 % (including education cess) of the premiums paid for the first
year and 1.545% for the renewal premiums. Service tax and education
cess are as per the extant laws.
34
2. For Lifesurance Suvidha Savings, the maximum aggregate sum insured limit
for an individual life is limited to Rs. 6, 00,000 for each 12 month period
and to Rs. 20, 00,000 in total. These limits will be calculated after including
all individual and group policies of IDBI Federal Life Insurance Co.
Ltd, except the fully underwritten policies.
3. Guaranteed Death Benefit is Sum insured plus vested Guaranteed Additions.
Bondsurance:
Bondsurance is designed for customer looking for guaranteed returns which will
not get affected by financial market conditions. It offers guaranteed return on
investment along with life insurance cover.
Bondsurance™ Advantage Insurance Plan
The IDBI Federal Bondsurance™ Advantage Insurance Plan is a single premium
plan where you need to make just a one-time investment. You can choose a
Maturity Period of 5, 7, 10, 15 or 20 years. At the end of the chosen period, you
will receive a guaranteed maturity amount. In case of death of the insured person
before the Maturity Date, a guaranteed Death Benefit will be paid. Thus you can
get life insurance cover, while earning an assured return on your investment.
Moreover, Bondsurance™ also offers you tax benefits as per section 80C &
10(10D) of the Income Tax Act, 1961.
Flexibility to choose Policy term from multiple options:
35
Customers can now choose policy term as 5yrs, 7yrs, 10yrs, 15yrs and 20yrs
Multiple Cover options
Customers can choose their plan from 3 available cover options as per their
preference. They have now option to insure single life and joint life depending on
the insurance cover option chosen by them.
Death benefit
In case of individual life, on death of the insured person the death benefit amount
will be paid. In case of joint life, death benefit will be paid on the death of the last
surviving insured person.
Minor Life is insured:
You can also take the policy on a minor as the Insured Person. In the case of a
minor, the Bondsurance™ Advantage Insurance Plan will vest in the minor upon
attaining majority.
Maturity Benefit:
Guaranteed maturity value is dependent on the policy term, premium amount, age
of the individual and insurance cover option chosen. Decreasing sum insured
options will enhance your returns.
Surrender Option
Bondsurance™ also provides liquidity before maturity. After 6 months from the
commencement date, you have the option to prematurely redeem Bondsurance™
Advantage Insurance Plan by surrendering the policy
Customers are allowed after 6 months after the policy commencement date.
36
Guaranteed surrender value will increase with the policy term.
Special surrender value higher than Guaranteed surrender value may be
payable.
Discount on single premium
If customers choose a Maturity Benefit of Rs 1, 50,000 or higher, they will also get
a discount on the single premium amount as per the Discount Table.
Bondsurance Plan
IDBI Federal Bondsurance™ Plan (Bondsurance™) is a single premium plan
which allows customer to make a one-time investment and get a guaranteed
amount on maturity. Customer can choose a maturity period of 5 or 10 years for
your investment. At the end of the chosen period, they will receive a guaranteed
maturity amount.
Besides the guaranteed maturity amount, Bondsurance™ also provides a life
insurance cover. In case of death before the maturity date, a Death Benefit which is
also guaranteed will be paid.
Thus customer can get life insurance cover, while earning an assured return on
their investment.
A. Guaranteed Return on investment
Bondsurance™ gives customer guaranteed returns on their one-time investment.
All they have to do is choose the Maturity Benefit, and the Maturity Period for
their investment. Based on customer’s choice, the investment they have to make by
way of single premium is determined.
B. Life Insurance Cover of 5 times the invested amount
37
Besides giving assured returns, Bondsurance™ also provides a life insurance
cover. In the unfortunate event of death of the Insured Person before the maturity
date, a Death Benefit equal to five times the single premium amount will be paid.
The Death Benefit (which is the Sum Insured) is guaranteed. The Plan will
terminate upon payment of Death Benefit. The life insurance cover ensures that the
financial security of loved ones is secured.
Wealthsurance:
Wealthsurance plan enables the policyholder to save and build wealth to meet their
financial goals. Wealthsurance plan comes up with a wide range of 13 investment
option and 7 insurance benefits with low charge structure and unmatched
flexibility. Wealthsurance® offers customers Insured Wealth Plans. They allow
customers to create, build and manage wealth by giving several choices and great
flexibility so that they plan meets their specific needs. Customers can decide how
they wish to save so that it suits their savings habit. Customer can choose how their
money is invested so that they can grow wealth as per their investment preferences.
What is even better, Wealthsurance® protects customers wealth plans with life
insurance benefits so that their wealth-building efforts remain unaffected in
unforeseen events and their financial goals can still be achieved.
Wealth Plan with a powerful range of Investment Choices
Wealth creation does not happen by chance, it needs a plan. Wealthsurance® is a
wealth plan which allows customers to build and manage wealth. Customer can
save into the plan as much money as they want, whether at regular intervals or as
per their convenience. Wealthsurance® offers a wide choice of investment options
from which they can select one or more, based on their preferences. The
investment options offered are designed to meet the needs of all types of investors
38
depending upon their risk appetite, stage of life or investment horizon. Customers
can choose options that give:
a. Assured fixed returns
b. Variable returns linked to market performance or
c. Returns linked to equity market but with protection of capital.
Wealth grows in plan, based on the options chosen.
Wealth Plan can be insured against unforeseen events
Wealthsurance® Plan can protect customers Wealth Plan against a range of events
such as death, 17 major diseases, sickness requiring hospitalisation, serious
accidental injuries or total and permanent disablement. With other investment
products, if any such event happens, customer may not be able to save as planned
or even be forced to withdraw from their savings. But in Wealthsurance®, these
benefits allow them to meet additional expenses without affecting their fund value
so that their plans to save and accumulate wealth are not affected even if life
throws surprises at them.
Wealthsurance ® is for those who will live
Life insurance is sometimes thought of as for those who might die, but
Wealthsurance® is for those who will live. Usually life insurance products provide
benefits upon death, but Wealthsurance® is designed to also give Living Benefits to
ensure your well-being in your own lifetime. There are various Wealthsurance
plans offered by the company such as
Wealthsurance ® Maxigain InsurancePlan
This plan maximizes the gains and the same time are shielded from potential
losses. The plan provides a unique investment fund called the MaxiNAV
39
Guaranteed Fund which offers the guarantee of the highest NAV achieved
on the reset dates during the 7 years tracking period from the date of launch
of the fund on the policy maturity date. This special feature can provide
customers with benefit from market increases and protects them from market
declines.
Wealthsurance ® Dreambuilder Insurance Plan
This plan ensures that customer’s goals of wealth creation are achieved even
in the events of serious misfortune and remain unaffected in unforeseen
events. This plan offers greater flexibility so that customer can create wealth
as per specific needs and investment preferences.
Wealthsurance ® Premier Insurance Plan
This plan combines wealth creation and the insurance protection into one
powerful financial solution. Unlike other investment
alternatives, it allows customer to ensure that their goals of wealth creation
are achieved even in case of serious illness.
Homesurance:
Homesurance protection plan provides full insurance cover for properties under
construction, thus ensuring that beneficiary gets the full sanctioned amount in case
of an unfortunate event. It also has an innovative fixed cover for those who would
prepay their loans early.
Homesurance Protection Plan
The IDBI Federal Homesurance® Protection Plan is a reducing term plan, which
provides insurance cover equal to the outstanding balance of home loan. In the
40
unfortunate event of death of the home loan borrower, the insurance cover enables
repayment of the home loan liability.
Protection against loan liability
A home loan is usually a large liability and if the breadwinner who would repay
the loan were not to be there, it could become a serious burden to the family. The
Homesurance® Protection Plan protects against this liability. The specifics of the
plan are as follows:
1. Cover Amount reduces over time
Outstanding home loan amount normally reduces over time as customer repay by
way of monthly installments. Accordingly, the cover amount under the
Homesurance® Protection Plan also reduces with time to reflect the outstanding
loan amount. At the time of the plan, customer will receive a Policy Schedule
based on the amount and terms of loan, which will show them the reducing cover
amount over time.
2. Benefit Amount is paid on death
In the event of death of the insured, insurer will pay either the cover amount as per
the Homesurance® Protection Plan Policy Schedule as on the date of death, or the
actual outstanding balance in the insured loan account as on the date of death,
whichever is higher. Death due to any cause including illness or accident is
covered under the plan. Death, whether in India or abroad is also covered under the
plan.
Homesurance Plan
IDBI Federal Homesurance® Plan (Homesurance®) is a mortgage reducing term
plan which offers protection to a person and his family from their home loan
41
liability. The plan provides a cover equal to the outstanding balance of home loan
in the unfortunate event of expiry of the insured.
A. Protection against Loan Liability
Homesurance® covers life for an amount equal to home loan liability as per the
home loan schedule. In case of an unfortunate event of expiry of the insured, the
outstanding balance amount is paid to the nominees in one lump sum, who may
then settle the loan liability.
B. Cover for Terminal Illness
A unique feature of the Homesurance® plan is that it pays an accelerated payment
of death benefit upon the diagnosis of a terminal illness, where the insured has a
medical prognosis of a life expectancy of six months or less. This helps to settle
the home loan liability should an unforeseen terminal illness occur.
C. Optional Insurance Benefits
To protect customer and his family from unforeseen events, they can opt for
optional insurance benefits as an addition to Homesurance® base plan.
The Optional Insurance Benefit is available only with the regular premium plan.
Additional premiums should be paid for the term of the optional insurance benefit
depending upon the sum insured chosen.
Incomesurance:
IDBI Federal Incomesurance Endowment and Money back Plan is a plan which is
designed for the customers to reach their goals with confidence. The main features
of this plan are:
Premiums paid for a limited period
42
Guaranteed annual payout
Minimum annual payout declared at the beginning
Additional annual payout is declared each time the premium is paid.
Additional annual payout is linked with G- sec interest rates
Customers can take periodic payments or accumulate till maturity
Lump sum cover or waiver of premium
Tax benefits under Sec 80C and Sec 10(10D)
IDBI Federal Incomesurance™ Endowment and Money Back Plan
(Incomesurance™) not only gives unmatched transparency and flexibility but
there are lots of other features which are inbuilt in the product like convenient
premium payment options, Tax benefits and double advantage of Endowment and
Money Back plan.
43
Advantage of Endowment and Money Back
Tax Benefits
Premiums waived in case of death
Convenient premium payment options
Complete transparency
Termsurance:
Teramsurance protection plan of IDBI federal offers unique increasing cover
option that can automatically increase the cover every year without increasing the
premium.
Termsurance ® Seniors Insurance Plan
Customers over the age of 50 can enroll for this plan till the maximum age of 85.
The entry to the plan is guaranteed without any questions of the state of the health
condition. In the unforeseen event of demise in the first two years of the policy,
125% of total premiums paid shall be returned. After two years, customers are
insured for the amount of sum insured for life. The amount of premium and cover
remain the same throughout the life of the policy, except after age 90. At age 90
the policy gets even better as premiums will stop, but life insurance cover will
continue. There are no maturity benefits.
Termsurance ® Premier Insurance Plan
44
IDBI Federal Termsurance® Premier Insurance Plan, a term insurance plan that
gives insured the power and flexibility to take complete charge of the financial
future of their loved ones.
Termsurance® is designed with a host of benefits and options aimed at satisfying
needs. It has choice of policy term, flexible premium payment options and lots
more. It also allows to create a plan as per insured and his family’s needs and
objectives, thus offering them a truly flexible protection plan.
Termsurance Protection Plan
IDBI Federal Termsurance® Protection Plan (Termsurance®) comes with three
cover options which insured can select on the basis of their requirement.
Termsurance® is designed with a host of benefits & options aimed at satisfying
every need. It not only allows to customise plan as per individual and family’s
needs, it also comes with a host of benefits like convenient insurance cover
options, flexible premium payment terms, choice of policy term and lots more
flexible options.
Major benefits of Multiple Cover options
Multiple cover options give you tailor-made protection
Flexibility in the policy term to suit your lifestage.
Flexibility in premium payment terms to suit your wallet.
Attractive discounts to encourage additional cover
45
o Advantage Women
o High Sum Insured Rebate
Tax benefits to help you grow your wealth faster
Termsurance ® Group Life Plan
The IDBI Federal Termsurance® Group Life Plan is a pure term plan designed to
cater to a wide variety of formal and informal groups such as the Employer-
Employee groups, bank -– depositor/customers groups, customer-supplier groups,
professional and affinity groups. It is a group term insurance plan that provides
basic life insurance protection to the members of the plan. Life insurance benefit
for all members of the plan is provided by one policy document that is issued to the
policyholder. The policyholder may differ for different groups. E.g. In the case of a
Bank providing life insurance cover to their deposit account holders, the Bank will
be the Master Policy Holder and the deposit account holder/ bank customer shall
be a member of the policy. Similarly, for an employer- employee group, the
employer will be the Master Policy holder and the employees shall be the members
of the policy.
Termsurance Grameen Bachat Yojana
This is a low cost risk protection plan targeted at rural population. It is an ideal
plan to protect the family members in the event of unfortunate demise of the major
bread winner and also to save for specific needs like repayment of loan, daughter’s
marriage or child’s education. The plan offers life coverage at a nominal cost along
with the option of refund of premium at maturity. Coverage terms offered are 3
years, 5 years and 10 years. The customer has the flexibility of getting the sum
assured ranging from Rs. 5000 to Rs. 100000 in the multiples of Rs. 1000. IDBI
46
Federal is also providing another “Grameen Suraksha Plan” in rural area which is
similar to this plan.
Loansurance
Loansurance is a cost effective way to ensure that the outstanding debt is settled in
the unfortunate event of death of the insured. This plan provides cover to a person
directly liable for loan repayment.
There are two cover options available under this plan.
Reducing Cover
Under the option, the insurance cover reduces as per benefits schedule. The
premium amount is computed over a period of time, taking into account initial loan
interest rate, the loan term and outstanding loan amount.
Level Cover
This option provides a cover for the sum assured as specified by the insured and
can be to the extent to the full agreed loan amount plus accrued interest as chosen
by the insured member. This remains unchanged throughout the cover term. Thus
even if the loan liability declines over time, the plan covers is the sum assured
throughout the cover time.
Microsurance
IDBI Federal Group Microsurance Plan provides affordable life insurance cover to
groups. This plan is extremely useful to micro finance institutions, self help groups
and NGO’s to insure the lives of their group members and thus provide security to
47
the group member’s families. The plan can also be used for providing loan
protection to the group member’s families.
Retiresurance
This is a zero death benefit pension plan, wherein the insured can accumulate a
corpus to enjoy pension after retirement. The plan is open for ages between 18-70
years, with vesting age between 40 and 75 years. This plan offers varied
investment options spread between 100% debt to 100% equity to choose from.
Flexibility to reduce future annual premium after completion of one year to at least
75% and not less than Rs. 10000 There is no switching cost under this plan. The
plan also offers tax deduction under Sec. 80C and tax free returns under Sec.
10(10D)
Financial Information:
The total premium earned for the half year ended September 30, 2010 was Rs.3427
million. The profit after tax for the same period is Rs.513 million. There have been
132 death claims reported during the period out of which 43 claims were settled
and 19 claims were rejected.
Marketing Campaigns:
IDBI Federal Life recently launched television commercials focusing on its
frontline products like Wealthsurance and Incomesurance. The campaign taglines
are “Jisne bhi suna khareed liya” and “Guaranteed Income Ki
Bhavishavani”. Whereas the first advertisement reflects that the product is so
great that whoever hears about it, buys it instantly, the second advertisement
promises to be clear and transparent on the issue of returns in the investment
48
product. IDBI Federal has also introduced two animation characters by the name
of Happy and Lucky to promote the brand. To create an awareness of the
products of the organization among the households, a painting competition
“Bright Sparks” was conducted and certificates were awarded to all participants.
COMPETITION ANALYSIS
IDBI FEDERAL LIFE INSURANCE Co. Ltd. is in a highly competitive segment
i.e., insurance sector they are having large number of rival companies fighting
along with them in taking control of the industry.
Threat of intense segment rivalry
The major plus point for IDBI FEDERAL LIFE INSURANCE Co. Ltd. is the
brand value of its partners. The competition in this market is a very difficult or
tough. The market condition is oligopoly where a few number of big competitors
are providing identical product and services differing only in quality of them. Each
competitor has their own trademark attribute. As we know LIC’s attribute is their
hold in rural market. But when we say about population growth, economic growth,
or government policies insurance segment is very attractive because only 25%
insurable person are insured secondly 80% population are under age of 45.
Threat of new entrance
Due to aggressive competition and high entry exit barrier, this is not attractive
segment for new player. For entering in insurance field, mandatory capital is 100
crores. Secondly, foreign stake limited with 26%, third Indian company have no
49
experience in insurance business. Exit barrier are also very high because, no
company can leave market after entering due to loss because firstly, 100 crores will
be lost secondly, their compensation (customer or other company) will be very
high or more than deposited money. So in long run, company will try to less their
business but they will not leave market. So this is good factor for IDBI FEDERAL
LIFE INSURANCE Co. Ltd. Because, where entry or exit barrier are high, profit
potential are also high.
Threat of substitute product
This is not attractive market in view of substitute goods because there is many
substitutes in market but only service style is different. Different insurance
company provides at least same product but presentation is different. In case of
lower substitute (means investment purpose) many product in India for example,
share, mutual fund, fixed deposit. Substitute place a limit on price and on profit.
Threat of buyer’s growing power
In India buyer’s growing power are increasing because they have more
concentrated or organized towards market. Government has established insurance
regulator (IRDA) in India for growing buyer’s barging power. Due to lowest
switching, buyers are very price sensitive and buyers have many sources for
knowing about different company product. Due to education buyer can analysis
that, which product is good for him. So due to growing buyer’s power this segment
is not good for new player.
Threat of supplier’s growing power
Due to oligopoly market condition insurance company cannot raise price but they
can increase their profit from selling more policies in market. In India, supply-
50
growing power (agent, broker, bancassurance) are growing due to lot of company
availability in IDBI Federal Life Insurance Co. Ltd.
CHAPTER – VI
ANALYSIS
51
ANALYSIS AND INTREPRETATIONThe following schedule and diagram shows the percentage of sales of products in
last year 2011.
Table 6.1
Source – Company records
PRODUCT NAME PERCENTAGE OF SALES
Incomesurance 84.9
Retiresurance(SP) 1.4
Childsurance 0.1
Lifesurance 9.8
Termsurance(LC) 0.4
Wealthsurance(RP) 0.2
Retiresurance(RP) 2.0
52
Termsurance(ROP) 0.3
Wealthsurance(SP) 0.8
84.9%
9.8%
2%
1.4%PERCENTAGE OF SALES
In-comesurance
Lifesurance
Retiresurance-RP
Retiresurance(SP)
0.8%Wealthsurance-SP
0.4%TermsuranceLC
0.3%Termsurance-ROP
0.2%Wealthsurance-RP
Source - Table 6.1
The following schedule and diagram shows the percentage of sales of products in
last year 2010.
Table 6.2
Source – Company records
PRODUCT NAME PERCENTAGE OF SALES
Incomesurance 52.00
Retiresurance(SP) 3.00
Childsurance 0.1
Lifesurance 9.8
53
0.1%Childsurance
Termsurance(LC) 0.4
Wealthsurance(RP) 24.00
Retiresurance(RP) 2.0
Termsurance(ROP) 0.3
Wealthsurance(SP) 8.4
Incomesurance52%
Retiresurance-sp3%
Childsurance0.1%
Lifesurance10%
Termsurance-lc0%
Wealthsurance-rp24%
Retiresurance-rp2%
Termsurance rop0.3% Wealthsurance-sp
8%
Percentage of sales
Source-table 6.2
54
The following schedule and diagram shows the percentage of sales of products in
year 2009.
Table 6.3
Source – Company records
PRODUCT NAME PERCENTAGE OF SALES
Incomesurance 50.00
Retiresurance(SP) 3.00
Childsurance 0.6
Lifesurance 12.00
Termsurance(LC) 0.8
Wealthsurance(RP) 21.00
Retiresurance(RP) 2.0
Termsurance(ROP) 0.5
Wealthsurance(SP) 10.1
In-comesurance
50%
Retiresurance-sp3%
Childsurance1%
Lifesurance12%
Termsurance-lc1%
Wealth-surance-rp
21%
Retiresurance-rp2%
Termsurance-rop1%
Wealthsurance-sp10%
Percentage of sales
55
Sales of Incomesurance in 3 years
2009 2010 20110
10
20
30
40
50
60
70
80
90
Sales of Incomesurance
Sales
Sales of Wealthsurance (SP) in 3 years
2009 2010 20110
2
4
6
8
10
12
Sales of Wealthsurance(SP)
Sales of Wealthsurance(SP)
56
Sales of Wealthsurance(RP) in 3 years
2009 2010 20110
5
10
15
20
25
30
Sales
Sales
Sales of Retiresurance(SP)
2009 2010 20110
0.5
1
1.5
2
2.5
3
3.5
Salesof Retiresurance(SP)
Salesof Retiresurance(SP)
Sales of Childsurance in 3 years
57
2009 2010 20110
0.1
0.2
0.3
0.4
0.5
0.6
0.7
Sales of Childsurance
Sales of Childsurance
Sales of Lifesurance in 3 years
2009 2010 20110
2
4
6
8
10
12
14
Sales of Lifesurance
Sales of Lifesurance
Sales of Termsurance(LC)
58
2009 2010 20110
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
Sales of Termsurance(LC)
Sales of Termsurance(LC)
Sales of Retiresurance(RP)
2009 2010 20110
0.5
1
1.5
2
2.5
Sales of Retiresurance(RP)
Sales of Retiresurance(RP)
Sales of Termsurance(ROP) in 3 years
59
2009 2010 20110
0.1
0.2
0.3
0.4
0.5
0.6
Sales of Termsurance(ROP)
Sales of Termsurance(ROP)
60
CHAPTER - VII
FINDINGS
FINDINGS
61
Incomesurance is getting sold more than any other product of IDBI Federal Life
Insurance Co. Ltd. in Thrissur branch of the company and the sales of
incomesurance has showed an increasing trend too. With that fact existing, this
organization study has thrown some light on the reasons behind it. They are:
As ‘Incomesurance’ is a product which provides guaranteed returns, the
executives of the company is encouraging more of this product to ensure the
branch’s reputation.
The unexpected market conditions resulted in huge losses for the customers
of IDBI Federal Life Insurance Co. Ltd. who has taken unit linked products.
This also resulted in the huge sales of ‘Incomesurance’ which is a risk free
product.
Many persons had chosen ‘Incomesurance’ with a view of getting fund back
at the time of professional course or marriage of their children.
Tax benefits of this product have attracted a lot of people.
Premium amount can be from Rs. 25000 to Rs. 100000. This flexible
amounts is very much helpful for the policy holders.
People have started to show their interest in other private insurance
providers other than LIC.
People have knowledge and awareness about the products through
advertisements and other promotional activities. A high penetration of print,
radio and TV advertisement campaigns over the years is beginning to have
its impact now.
Another important trend was in terms of people viewing insurance as a tax
saving and investment instrument as much as protective one.
62
CHAPTER - VIII
SUGGESTIONS
SUGGESTIONS
63
People were having good knowledge about insurance companies because of
the advertisements and through agent each and every individual I met was at
least visited by an insurance agent. The comparatively new player in
insurance sector like IDBI FEDERAL LIFE INSURANCE Co. Ltd. must
advertise well enough to reach most of the people, because the prospective
insurance customer will always look for brand name. So, the IDBI
FEDERAL LIFE INSURANCE Co. Ltd. must look forward to increase their
brand image.
IDBI FEDERAL LIFE INSURANCE Co. Ltd. is highly concentrating on the
high income segment of the overall population .Majority of the population
consists of middle or lower income population so it advisable that IDBI
FEDERAL LIFE INSURANCE Co. Ltd. must come up with marketing
strategies which is useful for getting the attention of general public.
Better service quality should include-issuing policy on time, providing
claims on time, proper communication via mail or courier on timely basis to
aware customer about the policy status.
People are not much aware of alternative policy scheme (health, diabetics),
so there are need to increase awareness of such type of policies among
people.
Mostly, people are not satisfied from the post service of insurance
companies due to dependence on agents or no knowledge about process, so
there should be need to increase awareness about self-service and awareness
among people by training and advertisement.
In insurance, process is too much time taking, when we compare to other
financial tools, so process work should be less, effective and flexible.
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BIBILIOGRAPHY
Emerging Trends in Banking, Finance and Insurance Industry by Prof.
Anand M.Agrawal & Krishn A.Goyal
Principles of Insurance Management by Neelam C. Gulati
www.lifeinsurancetextbook.com
Dalal street journal
www.wikipedia.org
www.idbifederal.com
www.policybazaarinsurance.blogspot.com
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