Manju File

8/4/2019 Manju File

http://slidepdf.com/reader/full/manju-file 1/88

SUMMER TRAINING REPORT

ON

“Awareness of life insurance products in Indian market.”

(With respect to HDFC SLI)Carried out at

Submitted in partial fulfillment of the requirement of the awards of degree in

Master Of Business Administration

SESSION(2010-2012)

Submitted to: Submitted by:

Controller of MANJU SINGHExamination ROLL NO;10033

M.D UNIVERSITY,ROHTAK.

Department Of Management Studies

Shri Ram College Of Engineering & Management

Plalwal (Haryana)

8/4/2019 Manju File


ACKNOWLEDGEMENT

The successful completion of my project includes many people who formally or

informally helped me.

It is a great pleasure to express my deepest sense of obligation to Dr. S. K. Gupta

Principle Director S.R.C.E.M. Palwal for providing me opportunity to do training at

HDFC STANDARD LIFE INSURANCE LTD.

I own my ever Indebtedness and Gratitude to Mrs. Neha Sharma for intelligent guidance,

valuable suggestion and encouraging attitute through out the tenure of my study.

I am really grateful & feeling glad to acknowledge Miss. Nisha Bansal who helped me in

preparation of questionnaire and time-to-time guidance in analyzing data.

I deem it my most pleasant duty to express my deep sense of gratitude to my parents and

friends for their love affection and ever encouraging approach.

8/4/2019 Manju File


PREFACE

Learning is an essential part of life .A person learns in everything he does. Each moment,

each day of his life teaches him a new thing.

Where as the practical knowledge is an important suffix to the theoretical knowledge,

both have to be coupled to be fruitful. Class room teaching makes the fundamental

concepts clear but they must be correlated with practical training to make the theoretical

base more strong.

I consider myself lucky to do my summer training at HDFC STANDARD LIFE

INSURANCE LTD.

.

It helped me to apply theoretical knowledge in . which made my financial concepts more

clear.

Outmost care has been taken while printing the report but all kinds of suggestions and

critical evaluation is welcomed.

8/4/2019 Manju File


INDEX

S.NO CONTENTS PAGE NO. SIGN

1 COMPANY

PROFILE

1-26

2. INTRODUCTION

ABOUT THE

PROJECT

27-40

3. OBJECTIVES,

SCOPE &

LIMITATIONS

41-44

4 RESEARCH

METHODOLOGY

45-50

5 COLLECTION OF

DATA

51-56

6. DATA ANALYSIS &

INTERPRETATIONS

57-69

7. FINDINGS OF THE

STUDY

70-71

8. CONCLUSIONS &

SUGGESTIONS

72-75

9. BIBLIOGRAPHY &

ANNEXURE

76-78

10. QUESTIONNAIRE 79-84

8/4/2019 Manju File


CHAPTER-1

COMPANY PROFILE

INTRODUCTION OF HDFC

8/4/2019 Manju File


The first private sector retail Housing Finance Company in India was incorporated in

1977 with almost 90% of the initial share holding in the hands of domestic institution and

retail investors and currently 77% of the shares hold by foreign institutional investors and

a primary objective of meeting a social needs of the common mass of India as well as

promoting home ownership by providing long-term finance to house holds for their

needs.

However, the needs was according to “National Building Organization” The demand was

estimate at 2 million units per year and the total housing shortfall is estimated to be 19.4

million units with the division of 12.76 million for rural and 6.64 million for urban. It is

listed on both BSE (Bombay Stock Exchange) and NSE (National Stock Exchange) and

having the market capitalization of Rs79 billion (2002 June). It has 118 offices and

having the second largest employment generator in India with the staff strength of 1029.

FINANCIAL STRENGTH

Was promoted with an initial share capital of 100 million.

Asset Base more than Rs21459 cr.

AAA (High Security and High Safety) rated for seven consecutive years.

HDFC IS A HIGHLY DIVERSIFIED GROUP. ITS GROUP COMPANIES ARE:

8/4/2019 Manju File


HDFC Limited

HDFC Bank Limited

HDFC was incorporated in 1977 with the primary objective of meeting a social need -

that of promoting home ownership by providing long-term finance to households for their

housing needs. HDFC was promoted with an initial share capital of Rs.100.

The Housing Development Finance Corporation Limited (HDFC) was amongst

the first to receive approval from the Reserve Bank of India to set up a bank in the

private sector. The bank was incorporated in August 1994 in the name of HDFC Bank

Limited, with its registered office in Mumbai.

HDFC Securities Limited

HDFC Securities Ltd was promoted by the HDFC Bank & HDFC with the objective of

providing the diverse customer base of the HDFC Group and other investors, a capability

to transact in the Stock Exchanges & other financial market transactions. HDFC

securities, provides you with the necessary tools to allocate, select and manage your

investments wisely, and also support it with the highest standards of service, convenience

and hassle-free trading tools.

HDFC Asset Management Company Limited

HDFC Fund is a dominant player in the Indian mutual fund space, recognized for its high

levels of ethical and professional conduct and a commitment towards enhancing investor

interests.

HDFC Realty Limited

8/4/2019 Manju File


HDFC Realty is a new, organized electronic marketplace for properties. HDFC realty

provides the entire gamut of real estate services, bringing together the "clicks world"

and the "bricks world" in a revolutionary and user-friendly way. Making available the

best guidance and the most professional, transparent, efficient service to the real

estate customer.

HDFC CHUBB GENERAL INSURANCE COMPANY LTD.

With over one century of experience in the field of non-life insurance from Chubb and HDFC’s expertise from the

financial segment, HDFC Chubb General Insurance Company Limited has the consumer insight to make its product

range world class and comprehensive.

HDFC STANDARD LIFE INSURANCE

HDFC STANDARD LIFE is the name, which is working as one of the best private

insurance company in insurance sector. HDFC Standard Life Insurance Company Ltd

was incorporated on 14th August 2000.It got the certificate of registration on 23rd

October.

INTRODUCTION OF STANDARD LIFE

8/4/2019 Manju File


Standard was incorporated in 1825. It is mainly a UK based company having 31 branches

in UK itself and many other branches in all over the world. It is also renounced as the

European Largest Mutual Life Insurance Company and recently voted “Company of the

Decade” by independent financial adviser in UK.

SOME FACTS ABOUT THE COMPANY

Founded in 1825

Mutual Life Insurance Company since 1925

Largest mutual life insurance company in Europe

Assets under management over Rs707836 corers (£ 89.2 billions) Total assets under

management: Rs.707836 Corers

New premium income 2003: Rs.76277 Corers

AAA rated by Standard & Poor’s and Moody’s

FINANCIAL SECURITY

8/4/2019 Manju File


Standard Life has the financial strength to remain secure and competitive. Company aims

to offer products that provide competitive returns to their customers while maintaining an

adequate level of financial strength to ensure their security.; that's why they believecustomer can have confidence in them.

MISSION

“To be the top new life insurance company in the country.”

VALUES

SERVICE

Offer a high quality customer service (pre & post sales)

And trained consultants who would advice the customers in choosing the right

product for him.

TRUST

Commitment to the Indian market to establish themselves as the most professional

Life Insurance Company in India.

INNOVATION

8/4/2019 Manju File


Commitment for developing quality products for the specific needs of the Indian

customers

Use latest technology.

WORLDWIDE OPERATIONS AND PRESENCE

Head Office - Edinburgh, Scotland (UK)

United Kingdom: 31 Branches

Canada 11 "

Ireland 7 "

Germany 1 "

Austria 1 Sales office

Spain 31 Branches

Hong Kong 1 Representative office

China 2 Representative office

AWARDS AND RECOGNITION

Year Award

8/4/2019 Manju File


2003 Company of the Year


2001 Best Personal Pension Provider


MONEY MARKETING AWARDS

Company of the Year every year from 1999 to 2010

Best Pension Provider 2004 and 2009

Best Group Pension Provider every year from 1998 to 2003

Best Personal Pension Provider every year since 1998 to 2003

INTRODUCTION OF HDFC STANDERD LIFE

The Joint Venture HDFC Standard Life

8/4/2019 Manju File


Be granted license by the IRDA to operate in life insurance sector. Each of the JV HDFC

Standard Life Insurance Company Limited was one of the first companies to player is

highly rated and been conferred with many awards. HDFC is rated 'AAA' by both

CRISIL and ICRA. Similarly, Standard Life is rated 'AAA' both by Moody's and

Standard and Poor’s. These reflect the efficiency with which HDFC and Standard Life

manage their asset base of Rs.15, 000 Cr and Rs.600, 000 Cr respectively.

THE PARTNERSHIP

HDFC and Standard Life first came together for a possible joint venture, to enter the Life

Insurance market, in January 1995. It was clear from the outset that both companies

shared similar values and beliefs and a strong relationship quickly formed. In October

1995 the companies signed a 3-year joint venture agreement.

8/4/2019 Manju File


Around this time Standard Life purchased a 5% stake in HDFC, further strengthening the

relationship.

The next three years were filled with uncertainty, due to changes in government andongoing delays in getting the IRDA (Insurance Regulatory and Development authority)

Act passed in parliament. Despite this both companies remained firmly committed to the

venture.

In October 1998, the joint venture agreement was renewed and additional resource made

available. Around this time Standard Life purchased 2% of Infrastructure Development

Finance Company Ltd. (IDFC). Standard Life also started to use the services of the

HDFC Treasury department to advise them upon their investments in India.

Towards the end of 1999, the opening of the market looked very promising and both

companies agreed the time was right to move the operation to the next level. Therefore,

in January 2000 an expert team from the UK joined a hand picked team from HDFC to

form the core project team, based in Mumbai.

Around this time Standard Life purchased a further 5% stake in HDFC and a 5% stake in

HDFC Bank.

In a further development Standard Life agreed to participate in the Asset Management

Company promoted by HDFC to enter the mutual fund market. The Mutual Fund was

launched on 20th July 2000.

INCORPORATION OF HDFC STANDARD LIFE INSURANCE COMPANY

LIMITED:

The company was incorporated on 14th August 2000 under the name of HDFC Standard

Life Insurance Company Limited.

Company’s ambition from as far back as October 1995, was to be the first private

company to re-enter the life insurance market in India. On the 23rd of October 2000, this

8/4/2019 Manju File


ambition was realized when HDFC Standard Life was the only life company to be

granted a certificate of registration.

HDFC and Standard Life have a long and close relationship built upon shared values and

trust. The ambition of HDFC Standard Life is to mirror the success of the parent

companies and be the yardstick by which all other insurance companies in India are

measured.

VISION AND VALUES OF HDFC STANDARD LIFE

“The most successful and admired life insurance company, which mean that we are the

most trusted company, the easiest to deal with, offer the best value for money, and set the

standards in the industry. In short, ‘the most obvious choice for all’”.

COMPANY’S VALUES

1. INTRGRETY

Honest and trustful in every action

Transparency

Stick to principles irrespective of every action

Be just fair to every one

8/4/2019 Manju File


2. INNOVATION

Building a storehouse of treasure through experience.

Looking at every product and process through fresh eyes every day.

3. CUSTOMER CENTRIC

Understand his expectations by keeping him as a centric point

Listen actively

Understand customer needs and deliver solutions

Customer interest always supreme

4. PEOPLE CARE

Genuinely understanding the people we work with

Guiding their development through training and support

Helping them develop requisite skills to reach their true potential

Know them on a personal front

Create an environment of trust and openness

Respect for the time of others

8/4/2019 Manju File


5. TEAM WORK

Whole team take the ownership of the deliverables

Consult or involved, understand and arrive at a common objective

Cooperate and support across department boundaries

Identify strengths and weakness accordingly allocate responsibility to achieve

common objective

AWARDS AND ACCOLADES

Shield for the best presented accounts for banks and financial institutions - over 11

times (8 years in a row)

1999 IMC Ramakrishna Bajaj National Quality Award in the service category

CII-EXIM Bank Commendation Certificate for commitment to Total Quality

Management – 2000

Asia money declared HDFC as the second best managed company in India – 2001

Euro money identified HDFC as one of Asia’s top 10 best managed companies in the

finance sector – 2001

8/4/2019 Manju File


Rated as the Best Non-Banking Financial Company in Asia by Institutional Investor

Research Group.

ORGANIZATIONAL STRUCTURE

8/4/2019 Manju File


The organizational structure of HDFC SL is of vertical type where MD & CEO (Mr.

Deepak Satwakar) is on the top in the organizational structure followed by the different

department of

Sales

Operations

Finance and accounts

Information technology

Legal and secretarial

Human resource

BUSINESS GROWTH

Track Record so far

The gross premium income of HDFC, for the year ending March 31, 2009 stood at Rs. 2,

856 Crores and new business premium income at Rs. 1,624 Crores.

The company has covered over 8,77,000 lives year ending December 31, 2010. Company

also declared our 5th

consecutive bonus in as many years for our ‘with profit’

policyholders.

117.3299.51

152.16

126.97

197.15

162.07

0.00

50.00

100.00

150.00

200.00

250.00

FY 08 FY 09 FY 10

LOANS APPROVED LOANS DISBURSED

TotalTotal

Growth –FY 08Growth –FY 08

ApprovalsApprovals

30%30%

DisbursementsDisbursements

28%28%

8/4/2019 Manju File


LOAN APPROVALS AND DISBURSEMENTS

PRODUCT OF HDFC SLProducts are the plans offered by the HDFC SL

Categorized into:

TRADITIONAL PLANS

Term assurance

Money Back plan

Children Plan

UNIT LINKED INVESTMENT PLANS

Unit Link Young Star

Endowment Plus

Unit Link pension Plan

UNIT LINK YOUNG STAR PLAN

8/4/2019 Manju File


IT IS THE INSURANCE POLICY LINKED TO THE MARKET. ITS AIM IS TO

OFFER

Choice of investment

Flexibility in premium payment

Flexibility in risk cover

BENEFITS

A parent is the Life assured which means money would be available on Death or Critical

Illness.

DEATH BENEFITS

On the death of the life assured under the ULIPS:

HDFCSLIC will pay the sum assured

Waive all future premium

8/4/2019 Manju File


HDFCSLIC will pay premium at the level chosen at inception from the date of critical

illness till the date of maturity

HDFCSLIC will pay the policy value on the date of maturity

THE ILLNESSES COVERED ARE:

Cancer

Coronary Artery Bypass Graft Sugary

Heart attack

Kidney Failure

Major Organ Transplant

Stroke

MATURITY BENEFITS

On maturity the unitized fund value will be paid and the policy will terminate.

SURRENDER BENEFITS

The policy can be surrender at any time. The amount payable will be the policy

Value less the surrender charges. At present the charges is 25% of three years

Outstanding premium.

EXAMPLE

Premium Amount Rs 25,000 Per Annum

Mode of Payment Quaterly Rs 2250 Per Annum

Policy Service Date 15 Months after commencement

Total premium amount receive till date of (S) Rs 31250

3rd Year premium payable under the policy 25000 MULTIPLIED BY 5=75000

3rd Year outstanding premium as the date of

service

75000-31250=43750

Service Charge 43750 multiplied by 25% = 10937.50

WITHDRAW BENEFITS

The policyholder has the option to withdraw Lump sum amount at any time, the

conditions are:

8/4/2019 Manju File


The minimum amount withdraw is Rs 10,000 and more

The policy fund value after the withdrawal and the withdrawal charges if any is not

less than the higher of:

The minimum fund limit which is Rs 15000 at present

The surrender charges if any

The cancellation charges if applicable to withdrawals

Presently no charge for withdrawals and cancellation.

PAID UP BENEFITS

Policy converted into paid up provided

3 years premium have been paid,

The policy acquired sufficient value, presently Rs 15000.

CHOOSE YOUR INVESTMENT FUND

In this plan the investment risk in your chosen investment portfolio is borne by you. This

means that the premiums you pay in this plan are subject to investment risk associated

with the capital markets. The unit price of the funds may go p or down, reflecting

changes in the capital markets.

So, the balance your level of risk and return, making the right investment choice is very

important and you are responsible for the choices you make.

THE DIFFERENT FUNDS OPTIONS ARE AS FOLLOWS:

GROWTH FUND

8/4/2019 Manju File


100% in equity market

Risk & return rating=very high

EQUITY MANAGED

60-100% in equity market

0-40% in government securities

Risk & return rating=very high

BALANCED MANAGED

Equity Fund

40%

60%

8/4/2019 Manju File


30-60% in equity market

70-40 in government security

Risk & return rating= high

DEFENSIVE MANAGED

15-30% in

equity market

85-70% in

government

security

Risk & return rating= moderate

SECURE MANAGED

8/4/2019 Manju File


100% in govt. securities & bonds

Risk & return rating=low moderate

LIQUID FUND

100% in

bank

deposits &

money

market

Risk &

return

rating=low

ALLOCATION RATE OF THE PREMIUM

Regular 1 and 2 year

Up to 1,99, 999 70%

2 L to 4, 99, 999 80%

5 L to 9, 99, 999 85%

8/4/2019 Manju File


10 L to 19, 99, 999 90%

Above 20, 00, 000 95%

3 years onwards 99%

Single premium top up (1 and 2 year) 97.5%

Single premium top-up (3 year onwards) 99%

Fund Management Charge: of Rs 0.80% of the fund per annum will be charge on a

daily basis. This charge deducted from the Net Asset Values of the units.

Policy Fee: An amount of Rs15 per month.

Risk Charge: A monthly charge will be collected by cancellation of the units towards

the risk cover opted under the policy. The charge will depend on sum at risk cover

chosen.

Sum at Risk =Sum Assured – withdrawal made during last two years-value of the

fund.

Surrender Charges: The present surrender charge is 30% of the difference between the

regular premiums expected and those paid, in the first 2 years of contract.

HDFC Standard Life does not charge on:

Premium Redirections

Fund switches

Partial Withdrawals

Policy Alteration and servicing request.

8/4/2019 Manju File


SWITCHING CHARGES

24 switches instructions free in a policy year. Any additional switch will be charged at

Rs. 100 per switch.

POLICY ADMINISTRATION CHARGES

Rs. 20 per month

Service tax and education Cess on risk premium

Current arte is 12.24%

TAXATION

The premium is paid under the policy will qualify for deduction under sec (80c) of the

Income Tax Act 1961.

Since, the policy has an integrated critical illness benefit, which is charged by

cancellation of units, the same will not be shown separately in the premium receipts. The

total amount of premium paid will be eligible for the deduction under sec (80c) of the

Income Tax Act 1961.

In case the premium paid in any year does not exceed 20% of the sum assured, under the

policy, the maturity amount will be tax free under sec (10) 10D of the Income Tax Act.

COMPETITORS

In presently there are 16 life insurance corporation companies are working and

performing in India. So definitely HDFC Standard life has good competition with other.

The main competitors are as following.

LIFE Insurance Corporation.

ICICI Prudential Life Insurance.

BAJAJ Allianz.

SBI Life Insurance.

8/4/2019 Manju File


BIRLA Sun Life.

AVIVA.

TATA Aig.

FINANCIAL RESULT FOR HDFC SL FOR YEAR 2010-2011

Table: 2.1

Total received premium has shown the tremendous

increase of 129%

There has been tremendous increase in the term of

new business premium, renewal and group business

income as clear from the above table

Table Showcasing Financial Results:

Parameters Apr-

Mar

2009-10

(Rs.

Cr.)

Apr-

Mar

2010-11

(Rs.

Cr.)

% Growth

Total received premium 668.401532.2

1129.23

i. New Business 486.151028.9

4111.65

ii. Renewal 182.25 503.27 176.14Effective Premium

Income (Total)

436.08 887.30 103.47

Group Business Premium

(EPI)

49.40 135.15 173.58

8/4/2019 Manju File


8/4/2019 Manju File


CHAPTER-2

INTRODUCTION OF THE TOPIC

INTRODUCTION TO INSURANCE

Insurance is a system by which the losses suffered by few are spread many; exposed to

similar risk. It is the protection against financial loss arising on happening of any

unexpected event like;

Flood

Draught

8/4/2019 Manju File


Earthquake

INSURANCE IS ESSENTIAL FOR

The calamity is either natural or unexpected.

The insured person does not gain out of this arrangement

It covers both the financial and non financial risk

BENEFITS OF INSURANCE

Safe guard oneself and one’s family for future requirement.

Peace of mind in case of financial loss

Encourage saving

Tax rebate

Protection from the claim made by creditor

security against personal loan, housing loan or other type of loan

Provide a protection covers to industries, agriculture, home and child.

8/4/2019 Manju File


INSURANCE IN INDIA

The Insurance sector in India has become a full circle from being an open Competitive

market to Nationalization and back to a Liberalized market again. Tracing the

developments in the Indian Insurance sector reveals the 360-degree turn witnessed over a

period of almost two centuries.

The business of life insurance in India in its existing from started in India in the year

1818 with the establishment of the Oriental Life Insurance Company in Calcutta.

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

statically information about both life and non-life businesses

1938- Earlier legislation consolidated and amended by the Insurance act with the

objective of protecting the interest of the insuring public.

1956- 245 Indians and foreign insurers and provident societies taken over by the central

government and nationalized.

INSURANCE SECTOR REFORMS

8/4/2019 Manju File


In 1993, Malhotra committee, headed by the former Finance secretary and RBI Governor

R.N Malhotra was formed to evaluate the Indian insurance industry and recommended its

future direction.

The Malhotra committee was set up with the objective of complementing the reforms

initiated in the financial sector. The reforms were aimed at “creating a more efficient and

competitive financial system required for the requirements of the economy keeping in

mind the structural changes currently underway and recognizing that the insurance is an

important part of the over all financial system where it was necessary to address the need

for similar reforms.

In 1994, the committee submitted the report and some of the key recommendation

included.

I) Structure:

Government stake in the insurance Companies to be brought down to 50%

Government should take over the holdings of GIC and its subsidiaries so that these

subsidiaries can act as independent corporations

All the insurance companies should be given greater freedom to operate

II) Competition

Private Companies with a minimum paid up capital of Rs.1bn should be allowed to

enter the industry

No Company should deal in both Life and General Insurance through a single entity

8/4/2019 Manju File


Foreign companies may be allowed to enter the industry in collaboration with the

domestic companies

Postal Life Insurance should be allowed to operate in the rural market

only one State Level Life Insurance Company should be allowed to operate in each

state

III) Regulatory Body

The Insurance Act should be changed

An Insurance Regulatory body should be set up

Controller of Insurance (Currently a part from the Finance Ministry) should be made

independent

IV) Investments

Mandatory Investments of LIC Life Fund in government securities to be reduced

from 75% to 50%

GIC and its subsidiaries are not to hold more than 5% in any company

(There current holdings to be brought down to this level over a period of time)

V) Customer Service

8/4/2019 Manju File


LIC should pay interest on delays in payments beyond 30 days

Insurance companies must be encouraged to set up unit linked pension plans

Computerization of operations and updating of technology to be carried out in the

insurance industry

The committee emphasized that in order to improve the customer services and increase

the coverage of the insurance industry should be opened up to competitionBut at the same

time, the committee felt the need to exercise caution as any failure on the part of new

players could ruin the public confidence in the industry.

Hence, it was decided to allow competition in a limited way by stipulating the minimum

capital requirement of Rs.100 cr. The committee felt the need to provide greater

autonomy to insurance companies in order to improve their performance and enable them

to act as independent companies with economic motives. For this purpose, it had

proposed setting up an independent regulatory body.

THE INSURANCE REGULAROTY & DEVELOPMENT

AUTHORITY (IRDA)

It is the regulatory body for insurance companies operating in India, formed by the act of

parliament It protects interest of policyholders, to regulate, promote and ensure orderly

growth of the insurance industry.

Reforms in the Insurance sector were initiated with the passage of the IRDA Bill in

Parliament in December 1999The IRDA since its incorporation as a statutory body in

April 2000 has fastidiously stuck to its schedule of framing regulations and registering

the private sector insurance companies.

8/4/2019 Manju File


The other decisions taken simultaneously to provide the supporting systems to the

insurance sector and in particular the life insurance companies were the launch of the

IRDA’s online service for issue and renewal of licenses to agents.

The approval of institutions for imparting training to agents has also ensured that the

insurance companies would have a trained workforce of insurance agents in place to sell

their products, which are expected to be introduced by early next year Since being set up

as an independent statutory body the IRDA has put in a framework of globally

compatible regulations In the private sector 12 life insurance and 6 general insurance

companies have been registered.

OBJECTIVE OF IRDA

1) To make available long term funds for infrastructure

2) To introduce new and innovative products

3) To affect the improvement in the quality of service to the customers

FUNCTIONS OF IRDA

1) To regulate the investment of funds by insurance companies

2) To adjudicate disputes between the insurance companies and the intermediaries

3) To supervise the tariff advisory committee.

HISTORY OF INSURANCE (PAST AND PRESENT)

Insurance industry has always been a growth-oriented indu

stry globallyOn the Indian seen too, the insurance industry has always been a noticeable

growth as comparing to other industry.

8/4/2019 Manju File


INSURANCE HAS BEEN DIVIDED INTO TWO TYPES

General Insurance

Life Insurance

GENERAL INSURANCE:

Triton Insurance Company Ltd was the first General Insurance Company to be

established in India in 1850, whose share was mainly held by the British The first

General Insurance Company to be set up by India was Indian Mercantile Insurance

Company Ltd which was established in 1907There emerged many players in Indian

scenario thereafter The General Insurance was nationalized after the promulgation of

General Insurance (Nationalization Act, 1972)The General Insurance Corporation of

India (GIC) and its four subsidiaries undertook the post nationalization General Insurance

business:

Oriented Insurance Company Ltd

New India Assurance Company Ltd

National Insurance Company Ltd

United India Insurance Company Ltd

Towards the end of 2000, the relation ceased to exist and therefore companies at present

operating as independent companies There after private insurance came into the picture

as the concept of insurance and population of India is growing and the present scenario is

General \ Insurance Company grew by 16% in 2007-2008 as the private insurance

company continued there robust performance, while public there show.

8/4/2019 Manju File


Then LIFE INSURANCE CORPORATION was established on 01.09.1956 and has

become the sole corporation to write Life Insurance Business in IndiaIt has the monopoly

over fifty years starting from 1956, but covered only 26% of the Indian population in

2000So, the Private players came into the market to cover rest of the Indian population as

Indian population is in the growing moodThen the Insurance industry saw a new sun

when IRDA invited the application for the registration as insurers in august 2000, with

the liberation and opening up the sector to private players; the industry has presented

promising prospect for the coming future as the population of India is growing very

fastThe transition has also resulted into introduction of Sample opportunities for the

professionals like BBA & MBA, Chatter account etc.

The Indian Industry is featured by the following attributes:

Not withstanding the rapid insurance penetration at 3.25% from 1.9% for the last

three to four years.

Ever growing middleclass income group composition in population

Growth of consumer movement which is an increasing demand for better insurance product

Inadequate application of information technology for business

Adequate fillip from the government in the form of Tax incentives to be insured

The industry formation need to keep vigil on these characteristics of the

Indian market and formulate there strategies to entail maximum contribution to the

output of the sector.

8/4/2019 Manju File


THE INSURANCE LIFE AND NON-LIFE ACCOUNTED FOR

MERELY

Fig: 5.1

The term “Insurance market Penetration” broadly measures the contribution of the Indian

industry in relation to a Nation’s entire economic productivity.

TABULATION AND ANALYSIS

In order to determine the willingness of the people to become FC for HDFC SLIC in

Faridabad, data collected by surveying is treated as analysis Response to the parameter

like professional, unemployed students, housewives, investment consultant, post office

agent

Willingness to be FC for HDFC

Yes No Total

Professional 2 28 30

Working employees 2 33 35

House wives 2 18 20

Students 3 22 25Investment consultants 2 18 20

Post office agents 3 12 15

Others - - 10

Total 14 131 155

8/4/2019 Manju File


yes

No

PROFESSIONALS

yes

No

Working Employees

8/4/2019 Manju File


ye

No

House wives

ye

No

Student

8/4/2019 Manju File


ye

No

Investment Consultant

yes

No

Post Office Agent

8/4/2019 Manju File


yesNo

Total

CHAPTER-3

8/4/2019 Manju File


OBJECTIVES OF STUDY

SCOPE OF STUDY

LIMITAION OF STUDY

OBJECTIVES OF STUDY

To make people more familiar with the life insurance industry and raise awareness of

HDFC standard life.

To give a general overview of the life insurance & pension policies being provided by

HDFC standard life.

To make people realize that apart from being a tool foe covering future risks and

uncertainties, insurance is also useful saving and tax saving alternative.

8/4/2019 Manju File


To create awareness of the business opportunity that HDFC standard life provides to

individuals.

To give an overview of the various benefits of being an insurance FC with HDFC

standard life.

To go forward with the formalities incase the candidate is interested in become a

financial consultant and to take references of other potential individuals who may be

interested in the same.

SCOPE OF THE STUDY

The study gives the information about the Life Insurance market.

This will helps to identify the customer’s preferences and their complaints towards

the company.

The study will helps to the company for identifying the customer’s needs and wants.

8/4/2019 Manju File


The study can be used by the researches for the further analysis and

recommendations.

The company executive can utilize the training report for various purposes

The training students can use the report to undergo the various spare parts.

LIMITATIONS OF THE STUDY

Lack of Universal application: Since the study had been conducted only in a selected

region and only in Life Insurance consumers, the applicability of the study in

different region and consumer products are restricted

8/4/2019 Manju File


Probability based study: Study is being done with the aid of Convenience

samplingHence the entire customers had not been considered for their feedback and

the inference drawn on the basis of selected sampling.

Business of the respondents: Walk in respondents were busy with their schedule and

hesitate to cooperate with the researcher and because of their rushing to home or

office, they had completed the questionnaire quickly which may yield some inherent

errors.

1`

8/4/2019 Manju File


CHAPTER 4

RESEARCH METHODOLOGY

RESEARCH METHODOLOGY

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

specific topic The function of a marketing research is to provide information, which assist

8/4/2019 Manju File


marketer in recognizing and reacting to marketing opportunities and problems In essence/

researchers mix managers to take the better decision.

Research methodology is a way to systematically solve the research problem It has manydimensions and methods, which constitute a part of research methodology When we talk

of research methodology we not only talk of research methods but also consider the logic

behind these methods we use in the context of our research study This we explain by

using a particular method or technique The knowledge of research methodology provides

good training to new research worker and enables to do better research The study of the

research methodology gives the student the necessary training in gathering materials and

arranging them, participation in the fieldwork and also training in the techniques for the

collection of data to particular problems Research methodology helps in the use of

questionnaires and controlled experimentation and in recording evidence and interpreting

it.

RESEARCH DESIGN

Research Designs the way in which the research is carried out It works as a blue print

Research Design is the arrangement of the conditions for the collections and analysis of

data in a manner that to combine relevance to the research purpose with economy in

procedure.

TYPES OF RESEARCH DESIGN

Exploratory Research Design

8/4/2019 Manju File


Descriptive & Diagnostic Research Design

Experimental Research Design

EXPLORATORY RESEARCH DESIGN

In it, a problem is formulated for precise investigation and working and hypothesis

are developed.

DESCRIPTIVE & DIAGNOSTIC RESEARCH DESIGN

In descriptive research design: those studies are taken which are concerned with

describing the characteristics of a particular individual or a group.

EXPERIMENTAL RESEARCH DESIGN

In it casual relationships between the variables are test edit is also known as

Hypothesis Testing Research Design

The present project is descriptive in nature The major purpose of descriptive

research is the description of the state of affairs, as it exists in present The maincharacteristic of this method is that the researcher has no control over the variable

she can only report what has happened or what is happening

8/4/2019 Manju File


SAMPLE DESIGN

It is not possible for any researcher to include each and every member of the universe

in his research process So, he selects small portion of the universe, which is its true

representative This group is known as sample and this process is called sampling.

Sampling Techniques can be categorized into two broad categories namely:

No probability Sample

Probability Sampling

NO PROBABILITY SAMPLING

In it, researcher selects sample deliberately, by using his own judgment, in it every

item of the universe does not have equal chances of inclusion in the sample.

It can be of following type:

Convenience Sampling

Judgment Sampling

Quota Sampling

PROBABILITY SAMPLING

8/4/2019 Manju File


It is known as “Random Sampling” or “Chance Sampling” In it, each population

element has equal chance of selection.

It can be of following types:

Simple Random Sampling

Stratified Sampling

Cluster Sampling

In the present project, no probability sampling has been used because sample is

selected by researcher’s own view and every item of the universe has not equal

chances of being selected Under no probability sampling, convenient sampling has

been used because sample has been selected according to own convenience.

UNIVERSE AND SURVEY POPULATION

All items in any field of inquiry constitute a ‘Universe’ or ‘Population’ A

complete enumeration of all the items in the ‘Population’ is known as a census

inquiry It can be presumed that in such an inquiry, when all items are covered, no

element of chance is left and highest accuracy is obtained But in practice this may

not be true Many a time it is not possible to examine every item in the population,

and sometimes it is possible to obtain sufficiently accurate results by studying

only a part of total population.

8/4/2019 Manju File


SAMPLE SIZE

The number of sample is 65 from N.C.Rcity, which fulfills the requirement eachrespondent is treated as a case of detailed analysis.

SAMPLING DESIGN

The universe of study being large, researcher has to resort to sampling method of data

collection On the basis of a section of the universe selected in a prescribed manner one is

able to deduce for the universe For the sample results to be applicable on the universe,

sample should be adequately chosen so to make it representative and reliable.

8/4/2019 Manju File


CHAPTER 5

COLLECTION OF DATA

DATA COLLECTION

Data are the bricks with which the researcher has to make a houseWhile the quality of

research findings depends on data, the adequacy of appropriate data in turn depends upon

8/4/2019 Manju File


proper method of data collectionA number of methods are at the disposal of the

researcher of which one has to select the most appropriate one for visualizing the research

objectiveThus he has to see that the method adopted is compatible with the resources and

research study

For the accumulation of data the sources were primary and secondary data.

PRIMARY DATA

These data are raw material they are the measurement observed and recorded as a part of

original study they are original in character the investigator or researcher directly collects

this data the basic form of obtaining this data is by observing and questioning.

The Primary data was a detailed interview schedule with the help of a detailed

questionnaire The samples were drawn purposively from various areas for the relevance

of the study Discussions were held with the general, branch manager and executives of

the company to design and execute the research

SECONDARY DATA

They are not originally drawn by the researcher as fresh data these are collected by some

other person for this purpose and published these types of data can be collected through

various sources.Data that collected from primary data i.e., they are already exit somewhere For the

purpose of our study we collected both the data

For the purpose of this study we collected

8/4/2019 Manju File


SECONDARY DATA through induction manual, magazines, corporate journals and

website.

PRIMARY DATA through

a) Questionnaire method

b) Interview method

In our study the main emphasis was on the questionnaire method Question, which were

asked, were of multiple choices in nature and were of, closed ended

Personal interview were also conducted There was face to face conversation between

researcher and the respondents Through interviewing, additional information was

received regarding our study.

SWOT ANALYSIS OF HDFC SL

STRENGTHSSTRENGTHS

HDFC SL’s strengths are many, to mention a few:

8/4/2019 Manju File


a) Global Presence:

Its collaborations and joint ventures with international companies such as

Standard life, and partnership with chub, enable it to bring the best service

available worldwide to its consumers.

b) Fast paced and flexible work culture, which provides its employees autonomy to

accomplish the task without much pressure from the higher authoritiesThus,

employees are motivated to give their best to the organizationThe core strength

of HDFC SL is the talent and innovativeness of its people, which enables it to

provide the “right solution at the right time.”

c) The mass markets handled through a chain of financial consultants usage closer

to the individual It has very strong distribution network.

d) Its pool of competencies: mutual funds, sum assured, etc

e) Ability to understand customer's business and offer right technology.

f) Longstanding relationship with customers.

g) Pan India support & service infrastructure.

h) Best value for money offerings.

WEAKNESSES

a) HDFC SL Could not able to match LIC in remote area services

8/4/2019 Manju File


b) Always emphasizes on numbers and fast results

c) After sales service.

d) Less promotional campaigns.

OPPORTUNITIESOPPORTUNITIES

a) Insurance industry booming at a rate of 45% every year.

b) Increasing consumer awareness about Insurance and its use.

c) Tremendous untapped potential of Insurance products in India.

d) Increasing competition.

e) Tie ups with various MNC’s enable to extract their core competencies.

THREATSTHREATS

a) New private players are coming in the market e.gRELIANCE Insurance.

b) Entry of MNC’s giving direct competition.

8/4/2019 Manju File


c) Govt instability has a longterm repercussion affecting company’s policies & its

growth.

CHAPTER 6

8/4/2019 Manju File


DATA ANALYSIS

&

INTERPRETATION

DATA ANALYSIS & INTERPRETATION

SAMPLING DETAILS

Sample Size – 65

Samples were selected on random basis

AGE GROUP

28

43%

20

31%

17

26%

Below 28 28 - 35 Above 35

8/4/2019 Manju File


Figure: 1.1

Highest number of Respondents from Age group below 28, mostly BPO executives–

43%

Figure 1.2

Total number of single respondents – 32

Total number of married respondents – 33

MARITAL STATUS

26

6

02

1417

0

5

10

15

20

25

30

Below 28 28 -35 Above 35

Single Married

8/4/2019 Manju File


Figure: 1.3

Respondents reluctant in providing actual/real figures

9

6

3

15

4 43

8

4

12

6

0

2

4

6

8

10

12

1416

Below

1.5 lacs

1.5 - 3

lacs

3 - 5 lacs Above 5

lacs

INCOME DISTRIBUTION

Below 28 28- 35 Above 35

8/4/2019 Manju File


Highest, 23 respondents in income bracket 1.5 – 3 lakhs, which comprises mainly of

age group below 28 years

Minimum, 9 respondents in income bracket of above 5 lakhs, 6 of which are in age

group of above 35 years.

Num ber o f peop le A ware o

6 1

55

5342

26

37

2917

38 7

ICICI P rudent ia l

TA TA A IG

H D F C S t a n d a d r

Bi r la sun l i fe

Aviva

M a x N e w Y o rk

O M K o t ak M a hi

IN G V y s y a

Met l i fe

S B I L i fe

Figure: 1.4

ICICI Prudential has the highest Brand Recall – 94%

HDFC Standard life has Brand Recall of 82%

8/4/2019 Manju File


Are you aware about ULIP Plans?

38%

62%

yes

no

Figure: 1.5

Only 24 respondents are aware about ULIP Plans out of 65 respondents

It shows that large section of society are not aware about ULIP Plans

8/4/2019 Manju File


LIFE COVERED

78%

22%

Respondents having Insurance cover

Respondents not having Insurance Cover

Figure: 1.6

78 % of respondents have insurance cover on own life and on life of their family

members

8/4/2019 Manju File


PENETRATION LEVEL OF Pvt. COMPANIES

27, 52%

12, 24%

12, 24%

Only LIC policy Only Pvt. Companies policy Both

Figure: 1.7

52% of respondents have insurance cover provided by LIC

24% of respondents have insurance cover provided by private Companies

Other 24% have got insurance from both LIC and private Companies

Total number of LIC policies sums up to 55 (68%) and total number of private

Companies policies sold sums up to 26 (32%)(This includes multiple policies bought

by one respondent from different companies)

Data provides that private Companies are fast making a mark in the market

8/4/2019 Manju File


TYPES OF PLANS SOLD

31%

27%

10%

15%

17%

Money back Endowment Pension

ULIP Not aware

Figure: 1.8

Money back and endowment plans have been most popular plans till now

ULIPs are fast gaining popularity

A large number of respondents were not even aware of type of plan, mainly because

policy was not bought by them directly

8/4/2019 Manju File


PURPOSE FOR BUYING INSURANCE

ANALYSIS FOR AGE GROUP BELOW 28 YEARS (SAMPLE SIZE – 40)

Risk cover is the most important purpose for buying insurance followed by option as

investment and old age provision

ANALYSIS FOR AGE GROUP 28 – 35 YEARS (SAMPLE SIZE – 30)

Frequency

Order of Preference I II III IV

Risk Cover 10 8 5 5

Investment 6 11 6 5

Tax Purpose 7 5 8 8

Old Age Provision 5 4 9 10

8/4/2019 Manju File


Risk cover is the most important purpose for buying insurance followed by option as

investment and old age provision

ANALYSIS FOR AGE GROUP ABOVE 35 YEARS (SAMPLE SIZE – 20)

Risk cover remains the most important purpose for buying insurance followed by old

age provision with increase in age

ANALYSIS FOR TOTAL SAMPLE

Frequency


Risk Cover 13 4 2 1

Investment 2 5 10 3

Tax Purpose 3 7 4 6


Frequency


Risk Cover 12 3 2 0

Investment 2 3 8 4

Tax Purpose 1 3 5 8


8/4/2019 Manju File


Risk cover remains the most important purpose for buying insurance followed by

option as investment

ULIP’s are responsible for increasing popularity of insurance as an investment tool

More Awarareness with emergence of

Private players?

90%

10%

yes

no

Figure: 1.9

Frequency


Risk Cover 35 15 9 6

Investment 10 19 24 12

Tax Purpose 11 15 17 22


8/4/2019 Manju File


Most of the respondents said yes to the question that with emergence of private

players in the life insurance industries they are more aware about the insurance

products

Only 15% of respondents said no to the above question.

This shows that with the entry of private players the awareness among the masses is

more as compare with earlier stages.

8/4/2019 Manju File


CHAPTER 7

FINDING OF THE STUDY

8/4/2019 Manju File


FINDINGS OF THE STUDY

Highest number of Respondents from Age group below 28, mostly BPO executives–

43%.

Only 24 respondents are aware about ULIP Plans out of 65 respondents.

It shows that large section of society are not aware about ULIP Plans .

78 % of respondents have insurance cover on own life and on life of their family

members.

52% of respondents have insurance cover provided by LIC.

24% of respondents have insurance cover provided by private Companies.

Other 24% have got insurance from both LIC and private Company.

Data provides the A large number of respondents were not even aware of type of

plan, mainly because policy was not bought by them directly.

At private Companies are fast making a mark in the market.

8/4/2019 Manju File


CHAPTER 8

CONCLUSION

AND

SUGGESTIONS

CONCLUSION

Marketing is a very crucial activity in every business organization every product

produced within an industry has to be marketed other wise it will remain as unsold

stock, which will be of no value.

In this project we found that the investor in insurance industry are taking interest to

have interest not only for security in a long term policy but also doing investment for

the short term policy which is presently called the ULIPS market.

8/4/2019 Manju File


ICICI Prudential, TATA AIG have better awareness in the market then HDFC SL in

private companies

Risk cover remains the most important purpose for buying insurance followed by

option as investment

Premium income for HDFC SL grows by 132% for financial year 20102011the

company generated new business premium income of Rs.486 crore

Unit linked products accounted for over 50% of the new business premium

HDFC Standard Life continues to have one of the widest reaches among new

insurance companies The company doubled the number of offices to 104 across the

country Through these offices, the company today services customer needs in over

440 towns The company also increased its depth in existing markets by increasing its

Financial Consultant strength from 17,000 as on 31st March 2010 to over 23,000 as

on 31st March 2011.

The company expanded its portfolio of products by launching plans to cover

Superannuating and Leave Encashment needs, thereby offering a wide range of

employee benefit solutions to its corporate clients.

Alternate Channels including banc assurance have recorded an impressive growth of

over 400% to contribute 37% to the Effective Premium Income (EPI).

SUGGESTIONSSUGGESTIONS

8/4/2019 Manju File


HDFC SL is having large number of channel partners but it is not supporting &

taking care all of them equally which results in increasing discontentment among new

channel partners because its not possible for company to support all of them equally

Company should take some positive action against it.

Company executive should visit customer on regular basis.

They should pay proper attention towards checking of various components of

insurance before end user delivery Otherwise it tends towards defame of brand name

in comparison to rivals.

Need to expend customer care center as the consumer base of HDFC SL is increasing

with tremendously fast pace.

Proper attention should be paid for advertisement planning otherwise it may lead to

problem for customer as well as for company.

Company should tie up with some event management company to organize various

promotional activities like canopy, Carnival.

Company should make policy for fixed end user price for all customers so that fair

game will be played & customer would not to compromise on their margin.

8/4/2019 Manju File


8/4/2019 Manju File


CHAPTER 9

BIBLIOGRAPHY

BIBLIOGRAPHY

WEBSITES

8/4/2019 Manju File


www.hdfc.com

www.hdfcstandardlife.com

www.irda.gov.in

www.legalpundits.com

BOOKS

Business research by C.R kothari

IC33 LIFE INSURANCE (Revised) by INSURANCE INSTITUTE OF INDIA

Indian Financial System by P.N Varshney & D.KMittal

NEWSPAPERS

The times of India

Economic times

http://www.hdfc.com/

http://www.hdfcstandardlife.com/

http://www.irda.gov.in/

http://www.legalpundits.com/

http://www.hdfc.com/

http://www.hdfcstandardlife.com/

http://www.irda.gov.in/

http://www.legalpundits.com/

8/4/2019 Manju File


ANNEXURE

8/4/2019 Manju File


QUESTIONNAIRE

8/4/2019 Manju File


8/4/2019 Manju File


YES NO

Q3. Have you taken life insurance on your own life or on life of any of you family

members?

YES/NO

If Yes, Please mention:

No. of Policies LIC Private Companies (With

Names)

____________ __________________

Average coverage ____________ ___________________

Type of Plan ____________ __________________

_____________ ___________________

_____________ __________________

Q4. What was you purpose/will is your likely purpose of taking insurance? (Rank in

order of Preference)

I) Protection of Family________ III) Tax benefit_____________

II) Investment__________ IV) Old age provision________

Q5. Do you plan your investments?

(a) Yes

(b) No, why _________________________

Q6. Do you feel opening up of the private sector has created more insurance awareness

among the public? YES / NO

8/4/2019 Manju File


Q7.Now that the private sector has been opened, would you prefer to buy insurance for

self and family through? LIC / Private Insurers

Please give reasons for your response

___________________________________________________________________

_____

_______________________________________________________________________

_______________________________________________________________________

_______________________________________________________________________

_______________________________________________________________________

________________

Q8. Are you aware about the concept of Financial Advisors?

(a) Yes (b) No

Q9. Do you currently avail financial advisor services/private banking services?

(a) Yes

(b) No, why _________________________

Q10. If yes, from whom?

(a) Citibank

(b) HDFC Bank

8/4/2019 Manju File


(c) Allegro Capital Advisors

(d) Bajaj Capital

(e) HSBC Bank

(f) YES Bank

(g) Religare

(h) others (please specify) ______________

Q11. What are the products you are getting from your service provider?

(a) Mutual Funds

(b) Initial Public Offer (IPO)

(c) Secondary Market

(d) Post Office Schemes/Debt

(e) Insurance

(f) Real Estate/Property

(g) Tax Planning

(h) Loans

(i) Administrative Services

(j) Gold

(k) Art/Paintings

(l) Others (please specify) ______________

FINANCIAL RESULT FOR HDFC SL FOR YEAR 2010-2011

8/4/2019 Manju File


Table Showcasing Financial Results:

Parameters Apr-

Mar

2009-

10

(Rs.

Cr.)

Apr-

Mar

2010-

11

(Rs.

Cr.)

% Growth

Total received premium 668.401532.2

1129.23

i. New Business 486.151028.9

4111.65

ii. Renewal 182.25 503.27 176.14

Effective Premium

Income (Total)

436.08 887.30 103.47

Group Business Premium

(EPI)

49.40 135.15 173.58

8/4/2019 Manju File


Documents

Manju File