Questionnaire

JAIPURIA INSTITUTE OF MANAGEMENT

LUCKNOW

ASSIGNMENT

OF

OPERATIONAL MANAGEMENT

ON

HDFC INSURANCE

SUBMITTED TO: SUBMITTED BY:

Mr. Asheesh Trivedi Animesh Agarwal (fs-08)

(Faculty of JIML) Amrita Tripathi (fs-07)

Ankit Gupta (fs-09)

Ankit Maheshwari (fs-10)

Ankit Tiwari (fs-12)

Shad Alam (fs -44)

INTRODUCTION

Life is a roller coaster ride and is full of twists and turns. You cannot take

anything for granted in life. Insurance policies are a safeguard against the

uncertainties of life.

Insurance is system by which the losses suffered by a few are spread over

many, exposed to similar risks. Insurance is a protection against financial loss

arising on the happening of an unexpected event. Insurance policy helps in not

only mitigating risks but also provides a financial cushion against adverse

financial burden.

Insurance policies cover the risk of life as well as other assets and valuables

such as home, automobiles, jewelry et al. On the basis of the risk they cover.

life is very fragile and death is a certainty. We cannot control the uncertainties

of life. But, we can cover the risks surrounding us. Life insurance, simply put, is

the cover for the risks that we run during our lives. It protects us from the

contingencies that could affect us.

Life insurance is not for the person who passes away, it for those who survive.

It is the responsibility of every bread earner to guard against the events that

could affect the family in the unfortunate circumstance of his / her demise.

Thus, having a life insurance policy is very vital. Before going for a life

insurance policy it is imperative that you know about various types of life

insurance policies.

INTRODUCTION TO THE INDUSTRY

THE HISTORY OF INDIAN INSURANCE INDUSTRY

Life Insurance

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

the Oriental Life Insurance Company. First attempts at regulation of the industry

were made with the introduction of the Indian Life Assurance Companies Act in

1912. A number of amendments to this Act were made until the Insurance Act

was drawn up in 1938. Noteworthy features in the Act were the power given to

the Government to collect statistical information about the insured and the high

level of protection the Act gave to the public through regulation and control.

When the Act was changed in 1950, this meant far reaching changes in the

industry. The extra requirements included a statutory requirement of a certain

level of equity capital, a ceiling on share holdings in such companies to prevent

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

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

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

companies. Business was heavily concentrated in urban areas and targeted the

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

against the interests of the consumers” then led the Indian government to

nationalize the industry. In September 1956, nationalization was completed,

merging all these companies into the so-called Life Insurance Corporation (LIC).

It was felt that “nationalization has lent the industry fairness, solidity, growth and

reach.”

Some of the important milestones in the life insurance business in India

are:

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

regulate the life insurance business.

1928: The Indian Insurance Companies Act enacted to enable the government to

collect statistical information about both life and non-life insurance businesses.

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

the objective of protecting the interests of the insuring public.

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

GROWTH AND DEVLOPMENT OF THE ORGANIZATION

HDFC Standard Life has recorded a strong year on year growth of 112% for the

period April-March 2005- 06, in comparison with the same period 2004-05, with

new business first year premium of Rs.1029 crores. The growth achieved by the

company was considerably higher than the private sector industry average of

84% for 2005-06. In terms of effective premium income (EPI), which gives a 10%

value to a Single Premium policy, and is an internationally accepted indicator of

an insurance company’s performance, the EPI grew by 103% from Rs.436 Cr. to

Rs. 887Cr.

HDFC Standard Life’s growth in new business is a result of number of lives

insured as well as, an increase in the average premium. For the individual

business, volume measured by the number of lives insured, witnessed a 32%

growth. The average premium also increased by 62% from Rs.17,000 in 2004-05

to Rs. 27,500 in 2005-06. Commenting on the huge potential that exists in the

Indian market today, Mr. Deepak Satwalekar, Managing Director & CEO of

HDFC Standard Life emphasised, “The GDP has been growing over 8% per

annum and 47% of all savings are now in financial saving forms; 16% of savings

is in the form of insurance premiums and another 16% is in Provident Fund and

Pensions i.e., 32% of India’s financial savings of the household sector are

available to be tapped. Therefore, growth for the private life insurance industry is

inevitable and HDFC Standard Life is confident of maintaining a steady

growthpace.”

Highlighting HDFC Standard Life’s differentiators, Mr. Deepak Satwalekar

said, “Our Company has the most competitive fund management charge, which

is the lowest in equity based products. Our fund management charge is as low as

0.8% per annum, the key to enhancing long-term returns. Our other differentiator

is that we believe in offering life insurance solutions to customers based clearly

on their needs, and ‘Disha’ is the way it is done.”

‘Disha’ is a Professional Sales Skills Training Program. The delegates in this

program are introduced to a ‘Need-based’ selling approach, which can cater to all

our clients opting for life insurance solutions. ‘Disha’ is aimed at providing a good

service to the client and building long-term relationships.

Contribution to the individual business premium income by the different channels

of distribution also changed significantly, compared to last year. The Corporate

Agency and Bancassurance channel has grown tremendously and currently

accounts for 43% of the company’s business. Speaking on this, Mr. Satwalekar

said, “The strategy to concentrate on activating a limited number of

bancasurance partners rather than going in for signing up a large number of

banks in the early years, also paid off. Our key to achieving bancassurance

success is our belief in a partnership approach, customized product offerings,

highly ethical dealings and providing good value to our partners and their

customers.”

HDFC Standard Life’s offerings of Employee Benefit Solutions, to the corporate

sector, through Group Business, have met with increased success with year on

year growth of 174%. Commenting on the strong growth of HDFC SL’s Group

Business, Mr. Satwalekar said, “Our excellent fund performance on retirement

products and increase in our client base with 150 clients cutting across a

spectrum of industries spanning from multinationals to PSUs to the older

business houses, have been the highlights of the year.”

Ongoing training for conventional products and specialized training for unit linked

products for more than 33,000 of our financial consultants has also helped its

customers choose the products best suited for their need for protection, savings,

investments and pensions. HDFC Standard Life is the only company requiring

its sales force to undergo specific training in ULIPs before they are permitted to

sell the same. There has been a huge jump in the number of its Financial

Consultants who have qualified to become members of the prestigious Million

Dollar Round Table (MDRT). From 124 members as on 31st December 2004, the

number has increased to 318 members as on 31st December 2005.

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

insurance companies. The Company’s geographical presence has also

increased and covers 169 offices across the country

QUESTIONNAIRE

TOPIC: “To study the awareness of Insurance with reference of HDFC in terms of Reliability, Responsiveness, Assurance, Empathy and Tangibility”

NAME OF RESPONDENT ……………………………………………………………..GENDER: ………………………………………………………………………………..ADDRESS: …………………………………………………………………………..CONTACT NUMBER: …………………………………………………………………..

1. ARE YOU EMPLOYED?YES NO

If YES, only then proceed

2. RESPONDENT PROFESSION?(PLEASE TICK)

a.) BUINESSMAN b.) SERVICEMANc.) PROFESSIONALS d.) OTHERS

3. ARE YOU ABOUT THE TERM INSURANCE? YES NO

4. DO YOU KNOW ABOUT IRDA? YES NO

5. DO YOU HAVE ANY INSURANCE POLICY?YES NO

6. WHICH INSURANCE POLICY DO YOU HAVE?

LIFE NON-LIFE BOTH

7. WHICH CO’S INSURANCE POLICY YOU PREFER THE MOST? (RANK THEM)

a) LIC

b) ICICIPRUDENTIAL

c) SBI LIFE INSURANCE

d) ING VYSYA LIFE

e) RELIANCE LIFE INSURANCE

f) TATA AIG LIFE

g) ANY OTHER ________( Specify)

8. FOR HOW MANY YEARS DO YOU HAVE INSURANCE POLICY? (Please Tick)

a) <5Yrs b) 5-10 Yrs c) 10-15 Yrs d) Any Other______ (Specify)

9. WHAT DO YOU THINK ARE THE BENEFITS OF INSURANCE COVER? (RANK THEM)

a) COVER FUTURE UNCERTAINITY

b) TAX DEDUCTIONS c) FUTURE INVESTMENT

d) ANY OTHER _________ (Specify)

10. WHICH FEATURE OF YOUR POLICY ATTRACTED YOU TO BUY IT? (RANK THEM)

a) LOW PREMIUM

b) LARGER RISK COVERANCE

c) MONEY BACK GUARNTEE

d) REPUTATION OF COMPANY

e) EASY ACCESS TO AGENTS

f) ANY OTHER _________ (Specify)

12. YOUR MONTHLY INCOME?

a)<4k b)4k-8k c)8k-12k d)12k-16k e)Other_____(Specify)

13 DO YOU REALLY THINK INSURANCE POLICY COVER IN TODAY’S SCENARIO IS NOT ESSENTIAL?

_____________________________________________________

14. WHAT’S YOUR PERCEPTION ABOUT INSURANCE? (RANK THEM)

a) A SAVING TOOL

b) A TAX SAVING DEVICE c) A TOOL TO PROTECT FUTURE

15. HOW HAS/WOULD YOU BOUGHT/BUY INSURANCE?

a) CUSTOMER APPROCHED INSURANCE COs

b) INSURANCE COs APPROCHED CUSTOMER 16. ARE YOU SATISFIED WITH THE POLICY?

a) SATISFIED SAVING TOOL

b) NOT SATISFIED c) NOT RESPONDING

17. ARE YOU SATISFIED WITH THE SERVICE OF YOUR EXISTING INSURANCE COMPANY?

a) SATISFIED SAVING TOOL


18. ARE YOU SATISFIED WITH THE SERVICE AGENT? a) SATISFIED SAVING TOOL


19. ARE YOU SATISFIED WITH THE BEHAVIOR AFTER PUCHASING THE POLICY? YES NO

20. ARE YOU SATISFIED EITH THE TERMS AND CONDITIONS OF YOUR EXISTING POLICY? YES NO

21. DO YOU PAY TAXES?

YES NO

22. WHERE HAVE YOU INVESTED FOR TAX SAVING? (RANK THEM)

a) LIC

b) NSC

c) BONDS

d) PPF

e) PF

f) EPF

23. WHICH IS THE BEST FORM OF INVESTMENTS? (RANK THEM)

a) FIXED ASSETS

b) BANK DEPOSITS

c) JEWELLERY

d) SECURITIES, i.e. Bonds, MFs

e) SHARES

f) INSURANCE

24. WHAT DO YOU INTENT TO GAIN FROM INVESTMENTS?

a) SAVING & RETURNS

b) SECURITY c) TAX BENIFITS

25. WHAT’S THE RIGHT AGE TO BUY INSURANCE?

a) AFTER 25 Yrs

b) AFTER 35 Yrs c) AFTER 45 Yrs

d) ANYTIME

26. HOW WOULD YOU RATE INDIAN INSURANCE COs?

a) RIGID PLANS

b) NON-USER FRIENDLY

c) UNSATISFATORY SREVICES

d) NON-AGGRESSIVE

e) SATISFACTORY

f) GOOD

g) VERY GOOD

27. WHAT WOULD YOU LOOK FOR IN AN INSURANCE COs? (RANK THEM)

a) A TRUSTED NAME

b) FRIENDLY SERVICE & RESPONSIVENESS c) GOOD PLANS

d) ACCESSIBILITY

28. ARE YOU PLANNING FOR NEW INVESTMENTS?

PLANNING NOT PLANING

29. WOULD YOU GO FOR INSURANCE IF A SERVICE PROVIDER AWAY FROM THE CITY OFFERS BETTER SERVICE & PRODUCTS?

a) YES

b) NO

c) UNCERTAIN

Remarks……………………………………………………………………………………………………………………………………………………………………………………………………………………..

Date-Place- Respondent signature

GAP ANALYSIS

SERVQUAL Model is a tool through which customer evaluates service quality

experience as outcome of the gap between expected and perceived quality.

The model was developed by Parasuram, Zeithaml and Berry in 1985 which

emphasizes on the key requirements for a service provider delivering the

expected service quality. It is also called PZB Model.

The model identifies five gaps that can cause unsuccessful service delivery.

By learning the flow of this model, it is possible to exercise greater

management control over the customer relationship. The study of this model

lead to an improved realization of the key issues at which the service provider

can influence the satisfaction of consumers.

SERVQUAL Model can be used to measure the gap between customers’

expected and perceived quality in the five different dimensions. These

dimensions are the pillar of the SERVQUAL Model. They are Reliability,

Assurance, Tangibles, Empathy and Responsiveness.

Above RATER (Reliability, Assurance, Tangibles, Empathy and

Responsiveness) Dimensions can be understood using following variables.

Reliability

1. Show sincere interest in solving customer problems

2. Perform the service right the first time

3. Provide their service as promised

4. Insist on error-free records

Assurance

1. Employee behavior instill customer confidence

2. Customers feel safe in their transactions

3. Employees are consistently courteous

4. Employees have knowledge to answer questions

Tangibility

1. Modern-looking equipment

2. Visually appealing physical facilities

3. Employees are neat-appearing

4. Visually appealing materials associated with the service

5. Keep promises

Empathy

1. Give customers individual attention

2. Operating hours are convenient to all customers

3. Employees give customers personal attention

4. Customers' best interests are at heart

5. Employees understand the specific needs of customers

Responsiveness

1. Inform exactly when services will be performed

2. Employees give prompt service

3. Employees are always willing to help

4. Employees are never too busy to respond to requests

SERVQUAL Model is a useful tool to find out the gaps which are shown in the

figure. In case of the service industry, this gaps can be understood as follows:

GAP 1: Lack of Understanding (Gap between Consumer Expectation

and Management Perception)

GAP 2: Lack of Development (Gap between Management Perception

and Service Quality Specification)

GAP 3: Poor Delivery (Gap between Service Quality Specifications and

Service Delivery)

GAP 4: Unrealistic Expectation (Gap between Service Delivery and

External Communication)

GAP 5: Service Gap (Gap between Perceived Service and Delivered

Service)

Service quality Specifications

Service delivery

Perceived service

Expected service

Personal needs Past experienceWord-of-mouthCommunication

External Communications

to clients

Gap 4

Gap 1Gap 2

Gap 3

Gap 5

Management perceptionsOf client expectations

Conceptual Model of Service QualityConceptual Model of Service Quality

Provider

Customer

Finding from SERVQUAL Model:

1. Tangible

3.663.683.7

3.72

3.743.763.783.8

EXPECTATION PERCEPTION

Expectation: 3.789Perception: 3.72

2. Reliability

3.7

3.72

3.74

3.76

3.78

3.8


Expectation: 3.784 Perception: 3.73

3. Responsiveness

3.43.53.63.7

3.83.9

44.1



4. Assurance

3.3

3.4

3.5

3.6

3.7

3.8

3.9



5. Empathy

3.5

3.6

3.7

3.8

3.9

4

4.1



Comparative Gap Analysis

33.23.43.63.8

44.2

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EXPECTATION

PERCEPTION

In bracing for tomorrow, a paradigm shift in companies insurance through

innovative products and mechanisms involving constant up gradation and

revalidation of the insurance internal systems and processes is called for. This

requires product development and differentiation, innovation and business

process reengineering, micro-planning, marketing, prudent pricing,

customization, technological up gradation, home / electronic /, cost reduction and

cross-selling.

However, the kind of technology used and the efficiency of operations would

provide the much needed competitive edge for success in insurance business.

Furthermore, in all these customers’ interest is of paramount importance. The

insurance sector in India is demonstrating this and we do hope they would

continue to chart in this traded path.

RECOMMENDATIONS

Need to focus on the rural part of the country.

Need to create awareness about the term Insurance as there are many

other people in India who are not yet aware about it.

Need to focus on the customer service rather than the sales of the policies

which will attract to more customers as in the present scenario the

customer need to better services rather than the better policies. He may

get sacrifice on the terms and conditions of the policies but not at all ready

to have some default in the services.

Need to focus on customer needs and wants.

Need to have strong R&D for findings the hidden needs of the customer.

Need to implement the proper implementation by Employees.

Documents

Questionnaire