PART-I

1

EXECUTIVE SUMMARY
2

EXECUTIVE SUMMARY
Overall, the life insurance and pension sector is set for rapid changes and growth in the years
ahead. Delivering service, building trust and being innovative are key areas in which any
company will have to excel in order to do well in the long road ahead. Different companies
will take different approaches and it would be myriad of solutions that will be found to delight
the Indian customer.
During the first part, I was given complete classroom training about the various unit linked as
well as the traditional plans and solutions which the company offers.
Later, Market esearch was done through various activities and tele!calling which are
discussed further in the report. "ctivities led to practical exposure and taught me the aspects of
customer dealing.
#inally, interesting conclusions were drawn out of the data collected regarding the "wareness
of #inancial $lanning among the people in today%s environment.
It was great experience because selling an insurance product demands a great deal of
confidence and product knowledge.
3

INDUSTRY PROFILE
4

INDUSTRY PROFILE
Overview
Wit !"r#e$t %&'(er )* !i*e i%$&r"%+e ,)!i+ie$ i% *)r+e i% te w)r!-. I%$&r"%+e ",,e%$ t)
(e " 'e#" ),,)rt&%it/ i% I%-i"0 It1$ " (&$i%e$$ #r)wi%# "t te r"te )* 12-23 ,er +e%t
"%%&"!!/0
T)#eter wit ("%4i%# $ervi+e$. it "--$ "()&t 5 ,er+e%t t) te +)&%tr/1$ 6DP 0I% $,ite )*
"!! ti$ #r)wt te $t"ti$ti+$ )* te ,e%etr"ti)% )* te i%$&r"%+e i% te +)&%tr/ i$ ver/
,))r0 Ne"r!/ 73 ,er +e%t )* I%-i"% ,),&!"ti)% i$ wit)&t !i*e i%$&r"%+e +)ver wi!e e"!t
i%$&r"%+e "%- %)%-!i*e i%$&r"%+e +)%ti%&e$ t) (e (e!)w i%ter%"ti)%"! $t"%-"r-$0 A%- ti$
,"rt )* te ,),&!"ti)% i$ "!$) $&(8e+t t) we"4 $)+i"! $e+&rit/ "%- ,e%$i)% $/$te'$ wit
"r-!/ "%/ )!- "#e i%+)'e $e+&rit/0 Ti$ it-$e!* i$ "% i%-i+"t)r t"t #r)wt ,)te%ti"! *)r
te i%$&r"%+e $e+t)r i$ i''e%$e0
9i$t)ri+"! Per$,e+tive
&he insurance came to India from '() with the establishment of the Oriental Life insurance
*orporation in +,+,.&he Indian life insurance company act +-+. was the first statutory body
that started to regulate the life insurance business in India. /y +-01 about +02 Indian, +1
foreign and 30 provident firms were been established in India. &hen the central government
took over these companies and as a result the LI* was formed. 4ince then LI* has worked
towards spreading life insurance and building a wide network across the length and the breath
of the country.
2

:

I',)rt"%t 'i!e$t)%e$ i% te !i*e i%$&r"%+e (&$i%e$$ i% I%-i";
+-+.5 &he Indian Life "ssurance *ompanies "ct enacted as the first statute to regulate the life
insurance business.
+-015 .20 Indian and foreign insurers and provident societies were taken over by the central
government and nationali6ed. LI* formed by an "ct of $arliament! LI* "ct +-01! with a
capital contribution of s.0 cr. from the 7overnment of India.
I',)rt"%t 'i!e$t)%e$ i% te #e%er"! i%$&r"%+e (&$i%e$$ i% I%-i" "re;
+-835 &he Indian Mercantile Insurance Ltd. set up! the first company to transact all classes of
general insurance business.
+-035 7eneral Insurance *ouncil, a wing of the Insurance "ssociation of India, frames a code
of conduct for ensuring fair conduct and sound business practices.
+-3.5 &he general insurance business in India nationali6ed through &he 7eneral Insurance
/usiness 9:ationali6ation; "ct, +-3. with effect from +st <anuary +-3=. +83 insurers
amalgamated and grouped into four companies! the :ational Insurance *ompany Limited, the
:ew India "ssurance *ompany Limited, the Oriental Insurance *ompany Ltd. and the 'nited
India Insurance *ompany Ltd. 7I* incorporated as a company.
5

I%$&r"%+e Se+t)r Re*)r'$
Pri)r t) !i(er"!i<"ti)% )* I%$&r"%+e i%-&$tr/. Li*e i%$&r"%+e w"$ ')%),)!/ )* LIC0
In +--=, Malhotra *ommittee! headed by former #inance 4ecretary and /I 7overnor .:.
Malhotra! was formed to evaluate the Indian insurance industry and recommend its future
direction. &he Malhotra committee was set up with the ob>ective of complementing the reforms
initiated in the financial sector. &he reforms were aimed at creating a more efficient and
competitive financial system suitable for the re?uirements of the economy keeping in mind the
structural changes currently underway and recogni6ing that insurance is an important part of
the overall financial system where it was necessary to address the need for similar reforms. In
+--2, the committee submitted the report and some of the key recommendations included5
Str&+t&re
7overnment stake in the insurance *ompanies to be brought down to 08@. 7overnment should
take over the holdings of 7I* and its subsidiaries so that these subsidiaries can act as
independent corporations.
C)',etiti)%
$rivate *ompanies with a minimum paid up capital of s.+ billion should be allowed to enter
the sector. :o *ompany should deal in both Life and 7eneral Insurance through a single
entity. #oreign companies may be allowed to enter the industry in collaboration with the
domestic companies.
7

Re#&!"t)r/ =)-/
&he Insurance "ct should be changed. "n Insurance egulatory body should be set up.
*ontroller of Insurance! a part of the #inance Ministry! should be made independent
I%ve$t'e%t$
Mandatory Investments of LI* Life #und in government securities to be reduced from 30@ to
08@. 7I* and its subsidiaries are not to hold more than 0@ in any company 9there current
holdings to be brought down to this level over a period of time;
C&$t)'er Servi+e
LI* should pay interest on delays in payments beyond =8 days. Insurance companies must be
encouraged to set up unit linked pension plans. *omputeri6ation of operations and updating of
technology is to be carried out in the insurance industry.
>

STATISTICS ?INDIAN @ 6LO=ALA
&his section gives the users important and detailed statistics of the Indian as well as the 7lobal
insurance industry. &hese statistics would give important insights of where the respective
markets are headed for.
&he global life insurance market stands at A+,0.+.. billion while the non!life insurance
market is placed at A-...2 billion.
&he 'nited 4tates itself accounts for about one!third of the A.22=.1 billion global
insurance market and <apan stands next with a .8.1.@ share.
India takes the .=rd position with '4 A-.-== billion annual premium collections and a
meager 8.2+@ share.
Out of one billion people in India, only =0 million people are covered by insurance.
IndiaBs life insurance premium as a percentage of 7D$ is >ust +.33 per cent.
&he income derived by 7I* and its subsidiary companies through investment was
s..2-+.31 crore and the investable fund generated was s..,2= crore in +---!.888.
Indian insurance market is set to touch A.0 billion by .8+8, on the assumption of a 3
per cent real annual growth in 7D$.
13

NATURE OF INDUSTRY
&he insurance industry provides protection against financial losses resulting from a variety of
perils. /y purchasing insurance policies, individuals and businesses can receive reimbursement
for losses due to car accidents, theft of property, and fire and storm damage) medical expenses)
and loss of income due to disability or death.
&he insurance industry consists mainly of insurance carriers 9or insurers; and insurance
agencies and brokerages. In general, insurance carriers are large companies that provide
insurance and assume the risks covered by the policy. Insurance agencies and brokerages sell
insurance policies for the carriers.
Insurance companies assume the risk associated with annuities and insurance policies and
assign premiums to be paid for the policies. In the policy, the companies states the length and
conditions of the agreement, exactly which losses it will provide compensation for, and how
much will be awarded.
&he premium charged for the policy is based primarily on the amount to be awarded in case of
loss, as well as the likelihood that the insurance carrier will actually have to pay. In order to be
able to compensate policyholders for their losses, insurance companies invest the money they
receive in premiums, building up a portfolio of financial assets and income!producing real
estate which can then be used to pay off any future claims that may be brought.
11

&here are two basic types of insurance carriers5 Direct and Reinsurance.
Dire+t +"rrier$ are responsible for the initial underwriting of insurance policies and annuities,
while Rei%$&r"%+e +"rrier$ assume all or part of the risk associated with the existing
insurance policies originally underwritten by other insurance carriers.
Direct insurance carriers offer a variety of insurance policies.
Life insurance provides financial protection to beneficiariesCusually spouses and dependent
childrenCupon the death of the insured.
Disability insurance supplies a preset income to an insured person who is unable to work due
to in>ury or illness
Health insurance pays the expenses resulting from accidents and illness.
An Annuity 9a contract or a group of contracts that furnishes a periodic income at regular
intervals for a specified period; provides a steady income during retirement for the remainder
of one%s life.
Property-casualty insurance protects against loss or damage to property resulting from
ha6ards such as fire, theft, and natural disasters.
Liability insurance shields policyholders from financial responsibility for in>uries to others or
for damage to other people%s property. Most policies, such as automobile and homeowner%s
insurance, combine both property!casualty and liability coverage. *ompanies that underwrite
this kind of insurance are called property!casualty carriers.
12

W"t i$ Li*e I%$&r"%+eB
Duman life is sub>ect to risks of death and disability due to natural and accidental causes.
Ehen human life is lost or a person is disabled permanently or temporarily, there is a loss of
income to the household. &he family is put to hardship. isks are unpredictable.
DeathFdisability may occur when one least expects it. &here are a number of life insurance
products which offer protection and also coupled with savings.
" Ter' i%$&r"%+e product provides a fixed amount of money on death during the period of
contract.
" W)!e Li*e i%$&r"%+e product provides a fixed amount of money on death.
"n E%-)w'e%t A$$&r"%+e product provided a fixed amount of money either on death during
the period of contract or at the expiry of contract if life assured is alive.
" M)%e/ ="+4 A$$&r"%+e product provides not only fixed amounts which are payable on
specified dates during the period of contract, but also the full amount of money assured on
death during the period of contract.
"n A%%&it/ ,r)-&+t provides a series of monthly payments on stipulated dates provided that
the life assured is alive on the stipulated dates.
" Li%4e- ,r)-&+t provides not only a fixed amount of money on death but also sums of
money which are linked with the underlying value of assets on the desired dates.
&here are a variety of life insurance products to suit to the needs of various categories of
peopleCchildren, youth, women, middle!aged persons, old people) and also rural people, film
actors and unorgani6ed laborers.
13

Life insurance products could be purchased from registered life insurers notified by the ID".
Insurers appoint insurance agents to sell their products.
"s per regulations, insurers have to give the various features of the products at the point of
sale. &he insured should also go through the various terms and conditions of the products and
understand what they have bought and met their insurance needs. &hey ought to understand the
claim procedures so that they know what to do in the event of a loss.
14

INDIAN INSURANCE SECTOR
RE6ULATORY =ODY
Insurance is a federal sub>ect in India. &he primary legislation that deals with insurance
business in India is5 Insurance "ct, +-=,, and Insurance egulatory G Development "uthority
"ct, +---.
Te I%$&r"%+e Re#&!"t)r/ "%- Deve!),'e%t
A&t)rit/ ?IRDAA
eforms in the Insurance sector were initiated with the passage of the ID" /ill in $arliament
in December +---. &he ID" since its incorporation as a statutory body in "pril .888 has
fastidiously stuck to its schedule of framing regulations and registering the private sector
insurance companies.
&he other decision taken simultaneously to provide the supporting systems to the insurance
sector and in particular the life insurance companies was the launch of the IrD"%s online
service for issue and renewal of licenses to agents. 4ince being set up as an independent
statutory body the ID" has put in a framework of globally compatible regulations.
MISSION-IRDA
CT) ,r)te+t te i%tere$t$ )* te ,)!i+/)!-er$. t) re#&!"te. ,r)')te "%- e%$&re )r-er!/
#r)wt )* te i%$&r"%+e i%-&$tr/ "%- *)r '"tter$ +)%%e+te- terewit )r i%+i-e%t"!
teret)0D
12

IMPACT OF LI=ERALISATION
&he introduction of private players in the industry has added to the colors in the dull industry.
&he initiatives taken by the private players are very competitive and have given immense
competition to the on time monopoly of the market LI*. 4ince the advent of the private players
in the market the industry has seen new and innovative steps taken by the players in this sector.
&he new players have improved the service ?uality of the insurance. "s a result LI* down the
years have seen the declining phase in its career. &he market share was distributed among the
private players. &hough LI* still holds the 3-@ of the insurance sector but the upcoming
natures of these private players are enough to give more competition to LI* in the near future.
LI* market share has decreased from -0@ 9.88.!8=; to ,+ @9 .882!80;.
LI* has the current market share of 3-@.
"mong the private players I*I*I $rudential has the maximum of appx. 0.18@
#ollowed by /a>a> "llian6 9=..3 @; and DD#* 4tandard Life of about =.++@.
/elow is the table that shows the market share of various players of the industry.
1:

&he following companies have the rest of the market share of the insurance industry.
*OM$":H :"MI M"(I& 4D"I
LIC 3-.=8
ICICI PRUDENTIAL 0.1=
=AEAE ALLIANF =..3
9DFC STANDARD LIFE =.++
=IRLA SUNLIFE ..=.
TATA AI6 +.20
S=I LIFE +..2
MAX NEWYORG 8.-8
AVIVA LIFE 8.,.
IN6 VYSYA 8.11
OM GOTAG LIFE 8.02
AMP SANMAR 8.=,
METLIFE 8.==
RELIANCE LIFE 8.80
&he liberali6ation of the Indian insurance sector has opened new doors to private competition
and the new and improved insurance sector today promises several new >ob opportunities. Eith
private players now in the field, there will be innovative products, better packaging, improved
customer service, and, most importantly, greater employment opportunities.
15

Tere "re " %&'(er )* ),ti)%$ t) +))$e *r)' *)r " +"reer i% I%$&r"%+e0 I-e"!!/ "%
i%$&r"%+e +)',"%/ wi!! "ve ),e%i%#$ i% te *)!!)wi%# *ie!-$;
"ctuaries
'nderwriter
4urveyor
Investment
Marketing G Distribution
A+t&"rie$
Ivaluates the risk for companies to be used for strategic management decisions.
"ctuaries use their analytical skills to predict the risk of writing insurance policies
through the use of mathematical, statistical and economic models.
"n actuary not only fixes the premium rates for new products, but also revises both
products and prices. &hey calculate costs to assume risk
U%-erwriter$
Insurance underwriters review insurance applications and decide whether they should
be accepted or re>ected based on the degree of risks involved in insuring the people or
ob>ects of concern.
In the life insurance business, an underwriter is expected to filter the Jbad or
substandard livesJ. Ehereas, in the general insurance segment, he takes care of risk
management0
17

A#e%t$H=r)4er$;
Insurance agents may work for one insurance company or as independent agents selling
for several companies.
Insurance agents and brokers can find openings in the health insurance sector, financial
planning services, retirement planning counseling or even provide other services, for
e.g. sell mutual funds, annuities etc.
S&rve/)rHL)$$ A$$e$$)r;
4urveyors are professionals who assess the loss or damage and serve as a link between
the insurer and the insured.
&hey usually function only in non life business.
&heir >ob is to assess the actual loss and avoid false claims.
S"!e$HM"r4eti%#;
"nd who can forget the guys who make and break a brand. &hey would be re?uired in a
large number in order to promote the number of products that will be launched by
numerous companies in the insurance sector.
1>

CURRENT SCENARIO OF T9E INDUSTRY
INSURANCE MARGET IN INDIA
India with about .88 million middle class household shows a huge untapped potential for
players in the insurance industry. 4aturation of markets in many developed economies has
made the Indian market even more attractive for global insurance ma>ors. &he 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. &he Indian consumer should be ready now
because the market is going to give them an array of products, different in price, features and
benefits. Dow the customer is going to make his choice will determine the future of the
industry.
CUSTOMER SERVICE
*onsumers remain the most important centre of the insurance sector. "fter the entry of the
foreign players the industry is seeing a lot of competition and thus improvement of the
customer service in the industry. *omputeri6ation of operations and updating of technology
has become imperative in the current scenario. #oreign players are bringing in international
best practices in service through use of latest technologies. &he one time monopoly of the LI*
and its agents are now
23

going through a through revision and training programs to catch up with the other private
players. &hough lot is being done for the increased customer service and adding technology to
it but there is a long way to go and various customer surveys indicate that the standards are still
below customer expectation levels.
DISTRI=UTION C9ANNELS
&ill date insurance agents still remain the main source through which insurance products are
sold. &he concept is very well established in the country like India but still the increasing use
of other sources is imperative. It therefore makes sense to look at well! balanced, alternative
channels of distribution.
LI* has already well established and have an extensive distribution channel and presence. :ew
players may find it expensive and time consuming to bring up a distribution network to such
standards. &herefore they are looking to the diverse areas of distribution channel to have an
advantage. "t present the distribution channels that are available in the market are5
K Direct sellingFetail
K *orporate agents
K 7roup selling
K /rokers and cooperative societies
K /ancassurance
DIRECT SELLIN6HRETAIL
Direct selling or retail business is carried out by "gents of the company. &his is the main
distribution channel due to the complexity of most
21


insurance products 9Indowment, Ehole of Life, 'nit Linked;. &his tends to be the focus of
most companies due to its past success as well as its ability to deliver the right advice.
Dowever, this channel can be expensive and it is a time consuming sales process. "n agent is
the public face of an Insurance company. Dence it is important that this face is always smiling
and presentable and the facts and figures at hisF her command are updated and correct.
"n agent should be a pleasing personality with complete knowledge about the various plans
and solutions which the company has to offer and must also understand the customer%s
psychology well to deal in an efficient manner.
=ANCASSURANCE
/ancassurance is the distribution of insurance products through the bankBs distribution channel.
It is a phenomenon wherein insurance products are offered through the distribution channels of
the banking services along with a complete range of banking and investment products and
services. &o put it simply, /ancassurance, tries to exploit synergies between both the insurance
companies and banks.
A-v"%t"#e$ t) ("%4$
$roductivity of the employees increases.
/y providing customers with both the services under one roof, they
can Improve overall customer satisfaction resulting in higher customer retention Levels.
Increase in return on assets by building fee income through the sale of
Insurance products.
*an leverage on face!to!face contacts and awareness about the
financial *onditions of customers to sell insurance products.
22

/anks can cross sell insurance products e.g.5 &erm insurance products with loans.
A-v"%t"#e$ t) i%$&rer$
Insurers can exploit the banksB wide network of branches for distribution of products.
&he penetration of banksB branches into the rural areas can be utili6ed to sell products in
those areas.
*ustomer database like customersB financial standing, spending habits, investment and
purchase capability can be used to customi6e products and sell accordingly.
4ince banks have already established relationship with customers, conversion ratio of
leads to sales is likely to be high. #urther service aspect can also be tackled easily.
A-v"%t"#e$ t) +)%$&'er$
*omprehensive financial advisory services under one roof. i.e., insurance services
along with other financial services such as banking, mutual funds, personal loans etc.
Inhanced convenience on the part of the insured
Iasy accesses for claims, as banks are a regular go.
Innovative and better product ranges
W9AT DOES LIFE INSURANCE 9AVE TO OFFERB
Life insurance is many different things to many different people. #or some, it is a premium to
be paid on time. #or others it offers li?uidity since cash can be borrowed when needed. #or the
investment!minded, it denotes a constantly growing capital account and numerous other
benefits.
23

&he contractual guarantee is the promise to pay, backed by one of the oldest and most stably
regulated financial industry operating in the Indian sub!continent today.
1A I%$&r"%+e =&/$ Ti'e "%- M)%e/
$eople like to refer to life insurance as time insurance, the reason being that life insurance
proceeds are paid to the insuredBs beneficiaries in case of death. &he money proffered by life
insurance helps buy time to ad>ust to the change of circumstances. Insurance provides large
amounts of cash that will keep the lifestyle for the survivors the way it was before the insuredBs
death.
2A I%$&r"%+e O**er$ Pe"+e )* Mi%-
#or the person who buys an insurance policy, it offers absolute and complete peace of mind.
De or she knows that the decision made by him will provide sound benefits in the future,
whether or not the individual may live to see it.
3A M&!ti,!e A,,!i+"ti)%$
&he future is uncertain for each and every one. :o one knows how long he or she will live. &he
investment benefit is paid to the insuredBs beneficiaries after his death or it can be used during
the life as well. Life insurance policy owners can turn to the cash value of the policy in case of
a financial emergency when all avenues are either blocked or denied.
4A E%-&ri%# E!"$ti+it/
4ince life insurance is flexible enough to serve several needs, the insured can keep several
long!term goals in mind once he or she invests in the insurance plan. &he cash value of the
policy can be allocated towards augmenting the monthly income during the retirement years.
24

Leisure years should be turned into pleasure years. $ermanent life insurance is designed on the
concepts of long!term flexibility.
2A Fi%"%+i"! Se+&rit/
&he insurance policy offers contractual guarantees to people looking for peace of mind when
they buy life insurance. Life insurance offers complete financial security. &he purchase of life
insurance demonstrates concern for a familyBs future financial well being.
:A Re#"r- *)r F"'i!/
&he purchase of life insurance clearly displays care and concern for the people the policy
owner loves.
5A I%$&r"%+e i$ S"*er
:o financial institution can do what life insurance does. :o industry can back its products with
reserves and surplus as sound as those of the insurance industry.
&he proof of strength and safety that insurance companies have ensured even under the most
adverse of conditions is a matter of pride for the entire insurance industry. #or generation after
generation, life insurance has been acclaimed as the very benchmark of security against which
the other industries are measured.
OPPORTUNITIES FOR INSURANCE COMPANIES
In the now open sector on insurance, the following is what I feel will determine the success of
the company in particular and the industry in general5
A +"%#e i% te "ttit&-e )* te ,),&!"ti)%
22

Indians have always been wary of employing their hard!earned money in a venture that will
pay them on their death. Insurance has always been used as a &ax saving tool. :o more, no
less. It is upon the insurers to educate the people to secureFinsure their future against any
unknown calamity and make a shield around their families and businesses.
A% ),e% "%- tr"%$,"re%t e%vir)%'e%t +re"te- &%-er te IRDA0
&he reason for this being on the top of our understanding is that when ever we have seen any
sector open up in India there are always grey areas and unsure policies. &hese are not exactly
what any player, be it Indian or foreign, looks for. It creates an air of uncertainty in all the
decision making process. Insurance as a sector re?uires players who are strong financially and
are willing to wait for returns. &heir confidence can be bolstered only if there is an open and a
transparent policy guidelines. &his will also help the consumers feel safe that the regulatory is
an active one and cares to do everything possible to keep things under control and help the
insurance environment grow maturely.
2:

A we!!-e$t"(!i$e- -i$tri(&ti)% %etw)r40
&o cater to the largest democracy in the world is by no means a cakewalk. Insurance profits are
directly related to number of insured and this is in turn related to the reach.
Tr"i%e- ,r)*e$$i)%"!$ t) (&i!- "%- $e!! te ,r)-&+t0
It is said that the insurance agent is the best salesman in the world. De makes you pay,
regularly, an amount promising to pay back only on your death. &hus the players will re?uire
an excellent sales team to sell their products in the now competitive environment.
E%+)&r"#e'e%t )* %ew "%- (etter ,r)-&+t$ "%- !etti%# te "+4%e/e- )%e$ -ie )&t0
&his will itself ensure the market grows. "nd that every classFsociety gets a product that best
suits them.
SPECIAL PROVISIONS
&he Income &ax "ct and Life Insurance policies
'nder 4ection +89+8D;, any sum received under a Life Insurance policy 9not being a Ge/
M"% policy; is also exempt from taxation. /ut it is wise to remember that $ensions
received from A%%&it/ plans are not exempted from Income &ax.
4ection ,8* provides a deduction up to s.+,88,888F! to an individual assesses for any
amount paid as a premium.
25

POLICY9OLDERS 6RIEVANCES
$olicyholders may have complaints against insurers either in respect of their policies or their
claims. "s per egulations for $rotection of policyholders% interests, .88., every insurer
should have in place, a grievance redressal system to address the complaints of policyholders.
&he ID" has a 7rievance edressal *ell which plays a facilitative role by taking up
complaints against insurers with the respective companies for speedy resolution. &he ID"
however does not ad>udicate on complaints.
SWOT ANALYSIS OF INSURANCE INDUSTRY
STREN6T9
+. /est returns with the added advantage of +88@ life insurance coverage.
.. 7ood option for new investors into the market as all the money is invested by best fund
managers so with less knowledge also they can earn good eturns.
=. /est commission charges paid to the agents which vary from +.@ to =0@ which is much
higher as compared to mutual funds i.e. , only .!..0@.
WEAGNESS
+. DD#* 4LI* could not able to match LI* in remote areas services.
.. Misleading facts given by life advisors about the returns of 'LI$s.
=. Didden charges taken by the companies.
2. Less $romotional *ampaigns.
27

OPPORTUNITY
+. ,8 percent of Indian population is still under insured. 4o there is a big opportunity for
insurance companies.
20 "s the stock market can be under the mark any time so it can bring loss to the investors but
as in 'LI$s there is proper mixture )* -e(t securities and e?uity so the loss is incurred
during dark trading days also.
=. 'nit!linked products are exempted from tax and they provide life insurance.
2. Increasing consumer awareness about Insurance and its use.

T9REAT
10 *annibalism within the industry by providing misleading figures to the investors.
.. 7ovt.%s instability has a long term repercussions affecting company%s policies and its
growth.
2>

COMPANY1S PROFILE
33

COMPANY1S PROFILE
INTRODUCTION
Delping Indians experience the >oy of home ownership.
Incorporated in +-33 with a share capital of s. +8 crores, DD#* has since emerged as the
largest residential mortgage finance institution in the country. &he corporation has had a series
of share issues raising its capital to s. ++- crores. DD#* operates through 30 locations
throughout the country with its *orporate Dead?uarters in Mumbai, India.
O=EECTIVES AND =ACG6ROUND
="+4#r)&%-
DD#* was incorporated in +-33 with the primary ob>ective of meeting a social need L that of
promoting home ownership by providing long!term finance to households for their housing
needs. DD#* was promoted with an initial share capital of s. +88 million.
=&$i%e$$ O(8e+tive$
&he primary ob>ective of DD#* is to enhance residential housing stock in the country through
the provision of housing finance in a systematic and professional manner, and to promote
home ownership. "nother ob>ective
is to increase the flow of resources to the housing sector by integrating the housing finance
sector with the overall domestic financial markets..
31

OR6ANIFATION AND MANA6EMENT
DD#* is a professionally managed organi6ation with a board of directors consisting of
eminent persons who represent various fields including finance, taxation, construction and
urban policy G development. &he board primarily focuses on strategy formulation, policy and
control, designed to deliver increasing value to shareholders.
FOUNDER I Mr0 9"$'&4("i P"re4
=rie* ,r)*i!e )* te =)"r- )* Dire+t)r$
Mr. Deepak 4 $arekh is the *hairman of the *ompany. De is also the Ixecutive *hairman
of Dousing Development #inance *orporation Limited 9DD#* Limited;. De >oined DD#*
Limited in a senior management position in +-3,. De was inducted as a whole!time
director of DD#* Limited in +-,0 and was appointed as its Ixecutive *hairman in +--=.
De is the *hief Ixecutive Officer of DD#* Limited. Mr. $arekh is a #ellow of the Institute
of *hartered "ccountants 9Ingland G Eales;.

Mr. (eki M Mistry >oined the /oard of Directors of the *ompany in December, .888. De
is currently the Managing Director of DD#* Limited. De >oined DD#* Limited in +-,+
and became an Ixecutive Director in +--=. De was appointed as its Managing Director in
:ovember, .888. Mr. Mistry is a #ellow of the Institute of *hartered "ccountants of India
and a member of the Michigan "ssociation of *ertified $ublic "ccountants.
Mr. "lexander M *rombie >oined the /oard of Directors of the *ompany in "pril, .88..
De has been with the 4tandard Life 7roup for =2 years holding various senior management
positions. De was appointed as the 7roup *hief Ixecutive of the 4tandard Life 7roup in
March .882. Mr. *rombie is a fellow of the #aculty of "ctuaries in 4cotland.


32

Ms. Marcia D *ampbell is currently the 7roup Operations Director in the 4tandard Life
group and is responsible for 7roup Operations, "sia $acific Development, 4trategy G
$lanning, *orporate esponsibility and 4hared 4ervices *entre. Ms. *ampbell >oined the
/oard of Directors in :ovember .880.

Mr. (eith : 4keoch is currently the *hief Ixecutive in 4tandard Life Investments Limited
and is responsible for overseeing Investment $rocess G *hief Ixecutive Officer #unction.
$rior to this, Mr. 4keoch was working with MFs. <ames *apel G *o. holding the positions
of '( Iconomist, *hief Iconomist, Ixecutive Director, Director of *ontrols and 4trategy
D4/4 4ecurities and Managing Director International I?uities. De was also responsible
for Iconomic and Investment 4trategy research produced on a worldwide basis. Mr.
4keoch >oined the /oard of Directors in :ovember .880.

Mr. Mr. 7autam Divan is a practicing *hartered "ccountant and is a #ellow he Institute of
*hartered "ccountants of India. Mr. Divan was the #ormer *hairman and Managing *ommittee
Member of Midsnell 7roup International, an International "ssociation of Independent
"ccounting #irms and has authored several papers of professional interest. Mr. Divan has wide
experience in auditing accounts of large public limited companies and nationalised banks,
financial and taxation planning of individuals and limited companies and also has substantial
experience in structuring overseas investments to and from India.

Mr. an>an $ant is a global Management *onsultant advising *IOF/oards on 4trategy and *hange
Management. Mr. $ant, until .88. was a $artner G Mice!$resident at /ain G *ompany,
Inc., /oston, where he led the worldwide 'tility $ractice. De was also Director, *orporate
/usiness Development at 7eneral Ilectric head?uarters in #airfield, '4". Mr. $ant has an
M/" from &he Eharton 4chool and /I 9Donours; from /irla Institute of &echnology and
4ciences.

33

Mr. avi :arain is the Managing Director G *IO of :ational 4tock Ixchange of India Limited. Mr.
avi :arain was a member of the core team to set!up the 4ecurities G Ixchange /oard of
India 94I/I; and is also associated with various committees of 4I/I and the eserve /ank
of India 9/I;.

Mr. Deepak M 4atwalekar is the Managing Director and *IO of the *ompany since
:ovember, .888. $rior to this, he was the Managing Director of DD#* Limited since
+--=. Mr. 4atwalekar obtained a /achelors Degree in &echnology from the Indian Institute
of &echnology, /ombay and a Masters Degree in /usiness "dministration from &he
"merican 'niversity, Eashington D*.

Ms. enu 4. (arnad is the Ixecutive director of DD#* Limited, is a graduate in law and holds a
Master%s degree in economics from Delhi 'niversity. 4he has been employed with DD#*
Limited since +-3, and was appointed as the Ixecutive Director in .888. 4he is
responsible for overseeing all aspects of lending operations of DD#* Limited.
34

32

DD#* has a staff strength of +8.-, which includes professionals from the fields of finance,
law, accountancy, engineering and marketing.
SU=SIDIARY @ ASSOCIATE COMPANIES
9DFC ="%4
9DFC M&t&"! F&%-
9DFC St"%-"r- Li*e JJ
I%te!e%et 6!)("! Servi+e$ Lt-0
9DFC C&(( 6e%er"! I%$&r"%+e C)',"%/ Lt-0
9DFC Re"!it/
Oter C)',"%ie$ C)-Pr)')te- (/ 9DFC
DD#* &rustee *ompany Ltd.
DD#* Developers Ltd.
3:

DD#* Menture *apital Ltd.
DD#* Mentures &rustee *ompany Ltd.
DD#* Investments Ltd.
DD#* Doldings Ltd.
Dome Loan 4ervices India $vt. Ltd.
*redit Information /ureau 9India; Ltd
9DFC STANDARD LIFE INSURANCE

INTRODUCTION;
DD#* 4tandard Life Insurance *ompany Limited was one of the first companies to be granted
license by the ID" to operate in life insurance sector. Iach of the <M player is highly rated
35

and been conferred with many awards. DD#* is rated B"""B by both *I4IL and I*".
4imilarly, 4tandard Life is rated B"""B both by MoodyBs and 4tandard and $oors. &hese reflect
the efficiency with which DD#* and 4tandard Life manage their asset base of s. +0,888 *r
and s. 188,888 *r respectively.
DD#* 4tandard Life Insurance *ompany Ltd was incorporated on +2th "ugust .888. DD#* is
the ma>ority stakeholder in the insurance <M with ,+.2 @ stake and 4tandard Life has a stake of
+,.1@. Mr. Deepak 4atwalekar is the MD and *IO of the venture.
37

T9E PARTNERS9IP ;
DD#* and 4tandard Life first came together for a possible >oint venture, to enter the Life
Insurance market, in <anuary +--0. It was clear from the outset that both companies shared
similar values and beliefs and a strong relationship ?uickly formed. In October +--0 the
companies signed a = year >oint venture agreement.
"round this time 4tandard Life purchased a 0@ stake in DD#*, further strengthening the
relationship.
In October +--,, the >oint venture agreement was renewed and additional resource made
available. "round this time 4tandard Life purchased .@ of Infrastructure Development
#inance *ompany Ltd. 9ID#*;. 4tandard Life also started to use the services of the DD#*
&reasury department to advise them upon their investments in India.
&owards the end of +---, the opening of the market looked very promising and both
companies agreed the time was right to move the operation to the next level. &herefore, in
<anuary .888 an expert team from the '( >oined a hand picked team from DD#* to form the
core pro>ect team, based in Mumbai.
"round this time 4tandard Life purchased a further 0@ stake in DD#* and a 0@ stake in
DD#* /ank.
3>

COMPANY1S MISSION;
&o be the top life insurance company in the market.
&his not only means being the largest or the most productive company in the market, but a
combination of several things like!
*ustomer service of the highest order
Malue for money for customers
$rofessionalism in carrying out business
Innovative products to cater to different needs of different customers
'se of technology to improve service standards
Increasing market share
COMPANY1S VALUES;
SECURITY; $roviding long term financial security to our policy holders will be our
constant endeavor. &his is done by offering life insurance and pension products.
TRUST; *ompany appreciates the trust placed by our policy holders in us. Dence,
company will aim to manage their investments very carefully and live up to this trust.
INNOVATION; ecogni6ing the different needs of our customers, company will be
offering a range of innovative products to meet these needs.
*ompany%s mission is to be the best new life insurance company in India and these are the
values that will guide us in this.
43

GEY MANA6EMENT PERSONNEL
C"ir'"%
Mr. Deepak 4. $arekh
=)"r- )* Dire+t)r$
Mr. (. M. Mistry
Ms. enu 4. (arnad
Mr. ". M. *rombie
Ms. Marcia D. *ampbell
Mr. :orman (eith 4keoch
Mr. 7. . Divan
Mr. 7. :. /a>pai
Mr. an>an $ant
Mr. avi :arain
M"%"#i%# Dire+t)r @ CEO
Mr. D. M. 4atwalekar
AUDIT COMMITTEE
Daribhakti G *ompany
*hartered "ccountants
/.(. (hare G *o.
*hartered "ccountants
41

="%4er$
DD#* /ank Ltd.
'nion /ank of India
Indian /ank
&he 4araswat *o!operative /ank Ltd.
#ederal /ank
42

GNOWLED6E MANA6EMENT
We% S)&!- O%e 6) F)r I%$&r"%+eB
Hour insurance need will change as your life does, from starting to work to en>oying your
golden years and all the stages in between. Iach one of these stages may pose a different
insurance needFcover for you. In this section, we have drawn up the basic life stages and help
you analy6e various insurance needs accordingly.
43

St"#e 1; Y)&%# "%- Si%#!e
&his is an important stage where one lays down the foundation of a successful life ahead. &ake
advantage of the time and power of compounding to ensure that you build up your dreams, so
start saving early.
Y)&r %ee-$;
o 4ave for a home and wedding
o &ax $lanning
o 4ave for 7olden years
St"#e 2 - E&$t M"rrie-
Marriage brings about a significant change. :ew dreams and new opportunities also bring in
additional responsibilities. Ehile both of you look forward to a happy and secure life, it is
e?ually important to ensure that eventualities don%t come in the way of shaping your dreams.
Y)&r %ee-$;
o $lanning for home F securing your home loan
Liability
o 4ave for vacation
o 4ave for your first child
44

St"#e 3 - Pr)&- P"re%t$
Once you have children, your need for life insurance is even more. Hou need to protect your
family from an untoward incident. Insure your protection umbrella takes into account the
future cost of securing your child%s dream. Hou will want life to go on for your loved ones, and
having enough life insurance is a way to help ensure that.
Y)&r %ee-$;
o $rovide for children%s education
o 4afeguarding family against loan liabilities
o 4avings for post!retirement
St"#e 4 - P!"%%i%# *)r Retire'e%t
Ehile you are busy climbing the ladder of success today, it is important for you to take time
and plan for your life after retirement. Daving an early start for retirement planning can make a
significant difference to your savings. &hink about your golden years even before you have
reached them. &he key is to think ahead and plan well using your time and money.
Y)&r %ee-$;
o $rovide for regular income post retirement
o Immediate &ax benefits
o Lead a secure, independent and comfortable
Life style after retirement
42

PRODUCT MIX
"t DD#* 4tandard Life, there is a bou?uet of insurance solutions to meet every need. &hey
cater to both, individuals as well as to companies looking to provide benefits to their
employees.
#or individuals, they have a range of protection, investment, pension and savings plans that
assist and nurture dreams apart from providing protection. One can choose from a range of
products to suit one%s life!stage and needs.
#or organi6ations they have customi6ed solutions that range from 7roup &erm Insurance,
7ratuity, Leave Incashment and 4uperannuation $roducts.
PRODUCTS FOR INDIVIDUALS
PROTECTION ! Hou can protect your family against the loss of your income or the burden
of a loan in the event of your unfortunate demise, disability or sickness. &hese plans offer
valuable peace of mind at a small price.
P!"%$; &erm "ssurance $lan
Loan *over &erm "ssurance $lan.
INVESTMENT ! &his includes a plan that is well suited to meet your long term investment
needs. Ee provide you with attractive long term returns through regular bonuses.
P!"%; Si%#!e Pre'i&' W)!e O* Li*e
4:

PENSION - O&r Pe%$i)% P!"%$ e!, /)& $e+&re /)&r *i%"%+i"! i%-e,e%-e%+e eve% "*ter
retire'e%t "%- !ive " re!"Ke- retire- !i*e0
P!"%$; $ersonal $ension $lan
'nit Linked $ension
'nit Linked $ension $lus
SAVIN6 - Our 4avings $lans offer you flexible options to build savings for your future needs
such as buying a dream home or fulfilling your children%s immediate and future needs.
P!"%$; Indowment "ssurance $lan,
'nit Linked Indowment,
'nit Linked Indowment $lus,
Money /ack $lan,
*hildren%s $lan,
'nit Linked Houng star,
'nit Linked Houng star $lus0
45

6ROUP PLANS
DD#* 4tandard Life has the most comprehensive list of products for progressive employers
who wish to provide the best and most innovative employee benefit solutions to their
employees. &hey offer different products for different needs of employers ranging from term
insurance plans for pure protection to voluntary plans such as superannuation and leave
encashment.
P!"%$; 7roup &erm Insurance with iders
7roup &erm Insurance with $rofit!4hare
7roup 'nit!Linked $lan
#or 7ratuity
#or Defined /enefit 4uperannuation
#or Defined *ontribution 4uperannuation
7roup Leave Incashment $lan
RURAL CUSTOMER - "ccording to research findings, there is keenness among rural
customers to invest in savings cum protection plan with a term of five years, especially, if the
premium amount is low and affordable. (eeping this in view, DD#* 4&DN LI#I has plans
like5
P!"%$; /ima /achat Ho>ana.
4uper /achat Ho>ana
47

DISTRI=UTION OFFICES
In addition to the corporate office at Mumbai, your *ompany had +1- offices in over +=0
citiesFtowns in the country. It has a widespread network of #inancial *onsultants, *orporate
"gents and /rokers servicing customers in these cities and towns.
FINANCIAL CONSULTANTS
&he number of licensed #inancial *onsultants appointed by your *ompany increased from
over .=,888 in the previous year to over ==,888 in the current year. During the year, the
*ompany continued its
4>

CURRENT SALES- 9DFC St"%-"r- Li*e

C9DFC STANDARD LIFE PACIN6 A9EADD
Te Fi%"%+i"! EK,re$$ +0th May .883
C9DFC St"%-"r- Li*e "$ re+)r-e- " $tr)%# /e"r-)%-/e"r #r)wt )* 112L *)r te ,eri)-
A,ri!-M"r+ 233:-35. i% +)',"ri$)% t) te $"'e ,eri)- 2332-3:. wit " %ew (&$i%e$$
*ir$t /e"r ,re'i&' )* R$0 1.32> +r)re0
I% ter'$ )* e**e+tive ,re'i&' i%+)'e ?EPIA. wi+ #ive$ " 13L v"!&e t) " Si%#!e
Pre'i&' ,)!i+/ "%- i$ "% i%ter%"ti)%"!!/-"++e,te- i%-i+"t)r )* "% i%$&r"%+e +)',"%/M$
,er*)r'"%+e. te EPI #rew (/ 133L t) R$0 775 +r)re *r)' R$0 43: +r)re0
9DFC St"%-"r- Li*eM$ #r)wt i% %ew (&$i%e$$ i$ " '"%i*e$t"ti)% )* te %&'(er )* !ive$
i%$&re- "$ we!! "$ "% i%+re"$e i% te "ver"#e ,re'i&'0 F)r te i%-ivi-&"! (&$i%e$$.
v)!&'e 'e"$&re- (/ te %&'(er )* !ive$ i%$&re- wit%e$$e- " 32L #r)wt0
Te "ver"#e ,re'i&' "!$) #rew (/ :2L t) R$ 25.233 i% 233:-35 *r)' R$ 15.333 i% 2332-
3:0
During the year the company issued over =,-3,888 policies and has covered more than
0,,8,888 livesO
23

T"(!e S)w+"$i%# Fi%"%+i"! Re$&!t$;
$arameters
"pril!March
.883!8,
9s. *r;
"pril!March
.88-!+8
9s. *r;
7rowth
9@;
T)t"! re+eive- ,re'i&' ::7043 1232021 12>023
i0 New =&$i%e$$ 47:012 13270>4 1110:2
ii0 Re%ew"! 172022 233025 15:014
E**e+tive Pre'i&' I%+)'e
?T)t"!A 43:037 775033 133045
6r)&, =&$i%e$$ Pre'i&'
?EPIA 4>043 132012 153027
21

22
F&%- N"'e O**er Pri+e$ ?R$A =i- Pri+e ?R$A
LiN&i- F&%- 2402113 2302725
Se+&re M"%"#e- F&%- 24052:7 23021>3
De*e%$ive M"%"#e- F&%- 2>0:125 270134>
="!"%+e- M"%"#e- F&%- 3401343 3204253
U%it Pri+e$ "$ )% 2>H37H2335
':I& $I*I "4 O: =8F8,F.883

FUTURE PLANS
DD#* has always been market!oriented and dynamic with respect to resource mobili6ation as
well as its lending program. &his renders it more than capable to meet the new challenges that
have emerged. Over the years, DD#* has developed a vast client base of borrowers,
depositors, shareholders and agents, and it hopes to capitali6e on this loyal and satisfied client
base for future growth. Internal systems have been developed to be robust and agile, to take
into account changes in the volatile external environment.
DD#* has developed a network of institutions through partnerships with some of the best
institutions in the world, for providing speciali6ed financial services. Iach institution is being
fine!tuned for a specific market, while offering the entire DD#* customer base the highest
standards of ?uality in product design, facilities and service.
FINANCIAL PLANNIN6
" comprehensive financial advisory service involving financial strategies, tax, corporateFtrust
structures, estate planning, legal issues, family law, asset allocation, asset protection and
investment advice.
Fi%"%+i"! P!"%%i%# t"4e$ i%t) "++)&%t;
Desired asset allocation, risk profile and return expectations.
/uilding cash flows correlating all expenses and income. Inflation and outflows due to
loans are considering in building the financial plan.
#uture goals like retirement, housing and childrenBs education F marriage or other needs.
23

W/ -) /)& %ee- Fi%"%+i"! P!"%%i%#B
Hou may have many dreams, needs and desires. #or example, you could be dreaming of5
Owning a new car,
/uying a dream house,
$roviding your children with the best education,
$lanning a grand wedding for your children
Daving a great time after your retirement
/ut in todayBs world of skyrocketing costs and increasing inflation, how many of these dreams
can you hope to turn into realityP /y planning well, you can utili6e your limited resources to
the fullest.
24

EXPERIENCE T9E POWER 3:3O FINANCIAL PLANNIN6
&he only thing permanent in life is change. &imes change. $eople change. 4o does life. Hou
expect life to be much better tomorrow than it is today. &omorrow, you hope to fulfill all your
dreams and aspirations. /ut what happens if things take an untoward turnP Or, if there is an
eventualityP $erhaps itBs time for you to change the way you plan your investments...


9)w wi!! 3:3P Fi%"%+i"! P!"%%i%# e!,B
Instead of investing in an ad!hoc manner, =18Q
#inancial $lanning helps you take a holistic, all!
round view. /riefly, =18Q #inancial $lanning
comprises5
Investment $lanning
*ash #low $lanning
&ax $lanning
Insurance $lanning
*hildren% #uture $lanning
etirement $lanning
INVESTMENT PLANNIN6; &o make your wealth grow
22

Iveryone needs to save for a rainy day. Once you have saved enough to take care of
emergencies, you should start thinking about investing and to make your money grow.
I%ve$t'e%t P!"%%i%# Servi+e i%+!&-e$;
isk $rofiling
"sset "llocation and $ortfolio *onstruction
*reation and "ccumulation of Eealth through 4ystematic Investment $lans 94I$;
egular review of progress and $ortfolio ebalancing
CAS9 FLOW PLANNIN6; &o provide for assets and meet the periodic cash re?uirements
In simple terms, cash flow refers to the inflow and outflow of money. It is a record of your
income and expenses.
*ash flow planning refers to the process of identifying the ma>or expenditures in future 9both
short!term and long!term; and making planned investments so that the re?uired amount is
accumulated within the re?uired time frame.
TAX PLANNIN6; &o save on taxes and increase your income
Pr),er t"K ,!"%%i%# i$ " ("$i+ -&t/ )* ever/ ,er$)% wi+ $)&!- (e +"rrie- )&t
re!i#i)&$!/0
"ccording to the Income &ax "ct, +-1+, one will be eligible for &ax /enefits under 4ection
,8* and 4ection +89+8D; of the act.
2:

One has to compare the advantages of several tax saving schemes and depending upon your
age, social liabilities, tax slabs and personal preferences, decide upon a right mix of
investments, which shall reduce your tax liability to 6ero or the minimum possible.
INSURANCE PLANNIN6; &o protect yourself, your family and your "ssets.
JInsurance is not for the person who passes away, it for those who survive,J goes a popular
saying that explains the importance of Insurance $lanning.
It is extremely important that every person, especially the breadwinner, covers the risks to his
life, so that his familyBs ?uality of life does not undergo any drastic change in case of an
unfortunate eventuality. Insurance $lanning is concerned with ensuring ade?uate coverage
against insurable risks.
C9ILDRENMS FUTURE PLANNIN6; &o give your children a financially secure future
Like every parent, you too must be over>oyed to watch your child grow. "ll parents want to
give the best possible upbringing to their children. &his includes good education and security,
in case of any eventuality. 4oon, your little bundle of >oy will grow up, and it will be time to
provide for his or her higher education and wedding.
&he purpose of *hildrenBs #uture $lanning is to create a corpus for foreseeable expenditures
such as those on higher education and wedding, and to provide for an ade?uate security cover
during their growing years.
RETIREMENT PLANNIN6; /ecause retirement is a time to relax, not to get worried
4ome like it. 4ome don%t. /ut retirement is a reality for every working person. Most young
people today think of retirement as a distant reality.
25

Dowever, it is important to plan for your post!retirement life if you wish to retain your
financial independence and maintain a comfortable standard of living even when you are no
longer earning. &his is extremely important, because, unlike developed nations, India does not
have a social security net.
CONSUMPTION PATTERN
QS)&r+e-=&$i%e$$ w)r!- '"#"<i%e 2
%-
wee4 A,ri! 233:
&he consumption pattern is determined by the income so more would be the income more
would be the consumption. &he consumption though can differ in terms of areas where the
money is actually spent. &he above representation tells us the consumption pattern of the
consumer in India i.e. where do they actually invest their money and in what proportion do
they spend in various areas. &he chart shows that people are spending 1.-@ of their savings
into savings and investments.
27
40.10%
4.10%
8.80%
6.90
%
6.60%
3.90%
10.80%
2.30%
7.60%
2.10%
0.80%
1.60%
4.60%
Food & Grocery
Home Textiles
Personl !re
"#in$ & %n#estment
!lot&in$
!ons'mer ('r)le
*ction
+tin$ o't
Foot,er
-o#ies & T&eter
+ntertinment
.ccessories
/oo0s & -'sic

O=EECTIVE; &o generate leads for various 'nit Linked $lans offered
by the company, by interacting with walking and existing customers and to know the
awareness level of #inancial $lanning among them0
SALES PROCEDURE;
2>
#I4&
*O:MI4"&IO:
"$$OI:&MI:&
#ILLI:7 &DI
$O$O4"L #OM
*OLLI*& &DI
IR'IID
DO*'MI:&4 ":D

&DI #I4&
$IMI'M

#oll
ow
'p
#oll
ow
'p

STEP 1; FIRST CONVERSATION WIT9 A GNOWN OR
AN UNGNOWN CUSTOMER
&his is the first time, when you interact with a person and try to get the information from him
about the industry or the company and understand the customer%s insight i.e. what actually
does a customer expects from the companies.
&he ob>ective was to know the awareness about #inancial $lanning among the customers and
this was done by getting a ?uestionnaire filled by the people. &he various activities performed
were5
1) GRIS9NA PLAFA; Dere we interacted with the commuters G collected the data.
2) MARGETS; ?6OAL MARGET @ =9A6AT SIN69 MARGETA during this
activity, we interacted with the shopkeepers as well as the walking people regarding their
views about the industry.
3) CANOPY AT MEERUT; &his activity was designed to target the people working in
/$Os and other I& companies.
4) TELE-CALLIN6; &his was random calling from the data base provided by the
company and the aim was to collect information from them.
5) *OPORATE PRESENTATION; " presentation was arranged for the employees of
MID "M ":D 4O:4 9$aras;, to make them aware about the importance of #inancial
$lanning in today%s unpredictable environment.
:3

STEP 2; APPOINTMENT
"ll the potential and interested customers of all the activities performed are then followed up
and an appointment is fixed for further details.
&he motive is to explain the customer in detail, about the various plans offered by the
company. &he customer is informed about the procedure and the options he can opt for like5
1A *hoose the premium he wish to invest
2A 4elect the $remium $ayment Option i.e. annual mode, half yearly mode, ?uarterly
mode, or monthly mode.
3A *hoose the amount of protection i.e. the sum assured, he desires.
4A Eith Maturity /enefit, choose the additional benefits like5
a; Life option S Death /enefit
b; Life G Dealth option S Death /enefit T "ccidental Death /enefit
c; Ixtra Life G Dealth option S Death /enefit T *ritical Illness /enefit T
"ccidental Death /enefit
2A *hoose the Investment funds or funds one desires.
&he various funds available are5
Li?uid #und
4ecure Managed #und
Defensive Managed #und
/alanced Managed #und
I?uity Managed #und
7rowth #und
:1

:A Other information like5
a; &ax /enefit
b; Marious *harges
c; 4witching option
d; 4urrendering
e; &erms G *onditions etc.
STEP 3; FILLIN6 T9E PROPOSAL FORM
"fter the second step, the interested customers are re?uired to fill the proposal form which
re?uires the following information5
b; $ersonal details of the policy holder,
c; $ersonal details of /eneficiary or :ominee
d; &he $remium amount selected
e; &he &erm of the policy
f; &he #und choice for investment

STEP 4; COLLECTIN6 T9E DOCUMENTS
Once the form is filled all the necessary documents are collected like5
a; "ddress proof,
b; DO/ certificate etc.
"nd also the first premium amount in form of che?ue or cash is collected.
:2

Eithin +0 days, the policy documents reach the customers place, and the customer is re?uired
to read the documents carefully.
:3

:4

PART -II
:2

INTRODUCTION
TO
T9E TOPIC
::

INTRODUCTION TO T9E TOPIC
Overall, the life insurance and pension sector is set for rapid changes and growth in the years
ahead. Delivering service, building trust and being innovative are key areas in which any
company will have to excel in order to do well in the long road ahead. Different companies
will take different approaches and it would be myriad of solutions that will be found to delight
the Indian customer.
During the first part, I was given complete classroom training about the various unit linked as
well as the traditional plans and solutions which the company offers.
Later, Market esearch was done through various activities and tele!calling which are
discussed further in the report. "ctivities led to practical exposure and taught me the aspects of
customer dealing.
#inally, interesting conclusions were drawn out of the data collected regarding the "wareness
of #inancial $lanning among the people in today%s environment.
It was great experience because selling an insurance product demands a great deal of
confidence and product knowledge.
:5

RESEARC9
ME9ODOLO6Y
:7

RESEARC9 ME9ODOLO6Y
&he study of awareness about #inancial $lanning among the people and particularly the
insurance sector covers data collection through observation, ?uestionnaire and interview of
consumers.
T/,e )* re$e"r+ ;
EK,!)r"t)r/ ;
&ype of research carried out was IU$LO"&OH in nature) the ob>ective of such research is
to determine the approximate area where the drawback of the company lies and also to identify
the course of action to solve it. #or this purpose the information proved useful for giving right
suggestion to the company.
D"t" C)!!e+ti)%;
$rimary data
4econdary data
Data used for the research work was primary in nature.
S"',!e &%it; -
&he research process was done by interacting with number of customers during the activities
performed, which included, markets, cold calling, canopies, etc. 4ample Design consists of
andom 4ampling.
4ample si6e5 ! +88 people
:>

Met)- )* +)!!e+ti)%; -
#ield procedure for gathering primary data included observation and interview schedule in
which the ?uestionnaires were filed by the interviewer.
$ersonal interviews through self administered survey was done to collect the data, market
research was undertaken, that was accomplished by performing various activities designed.
Re$e"r+ I%$tr&'e%t;
Ruestionnaire
&he ?uestionnaire was formulated by keep in mind the following $oints5 !
7iving the respondents clear comprehension of the ?uestion.
Inducing the respondents to co!operate.
7iving instructions as to what is wanted.
Identifying the needs to be known.
Li'it"ti)%$;
&he following were the limitations that were there during the course of the study52
+. Limited time period.
.. Less number of respondents.
=. /iasness of the respondents.
53

O=EECTIVES
51

O=EECTIVES
&o study the awareness of #inancial $lanning among the people.
&o study the importance of Insurance in today%s scenario.
/rand awareness of various private insurance companies.
$reference among different investment tools.
$urpose of buying insurance.
$reference in choosing channel for buying life insurance.
Ruality of service provided by agents and clients satisfaction level.
*ustomer%s perception of improvements brought in by entry of $rivate
Insurance *ompanies.
&o generate leads for 'nit Linked Insurance and the 'nit Linked $ension $lans, by interacting
with walking and existing customers of the company.
52

DATA ANALYSIS
@
INTERPRETATION
53

DATA ANALYSIS @ INTERPRETATION
.G+ (%"T1%/2T%345yrs.6
32L
41L
24L
Below 30
31 - 45
Above 45
Dighest number of espondents 92+@; from "ge group =+ to 20 yrs.
=0@ respondents are of age below =8 yrs, small percentage of which is unemployed.
54

MARITAL STATUS
-.1%T.7 "T.T2"
19
4
16
37
24
0%
10%
20%
30%
40%
80%
60%
70%
80%
90%
100%
/elo, 30 31 9 48 .)o#e 48
.G+5yrs6
"%4G7+ -.11%+(
&otal number of single respondents L .=
&otal number of married respondents L 33
52

INCOME DISTRI=UTION
%4!3-+ (%"T1%/2T%345.nn'l in 1s.::x.6
16
13
8
1
7
12
12
10
0
6
12
6
;1.8 lcs
1.8 9 3 lcs
3 9 8 lcs
< 8 lcs
%
4
!
3
-
+
Below 30 31 - 45 Above 45
Dighest, +1 respondents in income bracket below +.0 lacs, which mainly comprises of
age group below =8 years.
espondents of the age group =+!20 yrs, lie in all the income slabs.
Minimum, 1 respondents in income bracket of above 0 lacs, which are in age group of
above 20 years.
5:

ARE YOU AWARE A=OUT FINANCIAL PLANNIN6B
98%
2%
0
10
20
30
40
50
60
70
80
90
100
4
3

3
F

P
+
3
P
7
+
(3 =32 >43? ?H.T %"
F%4.4!%.7 P7.44%4G @
YES
NO
-,@ of the respondents were aware about #inancial $lanning.
55

=RAND RECALL
/1.4( 1+!.77
100
96
92
82
86
72
64
78
71
60
81
7%!
%!%!% Pr'dentil
H(F! "td 7iAe
T.T. .%G
/%17. "24 7%F+
>3T.> -.H%4(1.
"/% 7%F+
.*%*.
-.B 4+? =31>
-+T7%F+
%4G*="=.
+88 @ respondents mentioned first name to be LI*
"mong private players, I*I*I $rudential has the highest
/rand ecall i.e. -1@
DD#* 4tandard life has /rand ecall of -.@
57

INVESTMENT PREFERENCE
%4*+"T-+4T P1+F+1+4!+
11%
18%
21%
9%
20%
21%
Banks !os"
o##$%e
S&a'e (a'ke"
)ns*'an%e
Bon+s
(*"*al ,*n+s
-eal Es"a"e
.+@ respondents prefer banks and post office schemes as an investment tool preference.
espondents of age group below =8 years prefer Mutual #unds, as they provide higher
returns than banking investment tools.
Insurance ranks .nd as an investment tool choice, which itself includes various protection,
saving and pension plans.
7ovt. /onds G securities are mostly preferred by people of higher age group rather than
young generation.
$roperty as an investment option is most lucrative choice. Dowever it is important to
mention that ma>ority of respondents are in age group of above =8 years and people with
high income bracket prefers to invest in eal Istate0
5>

INSURED PERCENTA6E
.1+ =32 %4"21+(@
87%
13%
YES
NO
,3 @ of respondents were insured on own life and on life of their family members.
4o we had += @ of potential customers to approach.
73

COMPANY PREFERENCE
!3-P.4= P1+F+1+4!+5in %6
88% 30% 18%
0 20 40 60 80 100 120
1
ON.Y .)/ BO01 ON.Y !20. /Os
00@ of respondents have insurance cover provided by LI* only
+0@ of respondents have insurance cover provided by $rivate *os. only
Ehereas =8@ have got insurance from both LI* and $rivate *ompanies.
&otal number of LI* policies sums up to ,0@ and total number of $vt. *ompanies policies
sold sums up to 20@.
Data provides that though LI* is still got a maximum market share but $rivate *ompanies
are making a fast move in the market.
71

TYPE OF PLAN =OU69T
T=P+ 3F P7.4
26C 29%
20C 23%
24C 28%
17C 20% (ONEY BA/3
EN4O5(EN0
!ENS)ON !.AN
6.)!s
Money back $olicies have been most popular and also the endowment plans.
"s people today are more aware about financial planning, so people of the age =8 years
have planned for their etirement now.
'LI$s are fast gaining popularity as they provide investment
benefit with Insurance.
72

PURPOSE OF =UYIN6 INSURANCE
P21P3"+ 3F /2=%4G %4"21.4!+
82%
11%
23%
14%
0 10 20 30 40 80 60
1is0 !o#er
%n#estment
Tx /eneAit
1etirement
Plnnin$
isk cover remains the most important purpose for buying insurance followed by option as
&ax saving tools.
etirement $lanning in a early period is also gaining the market share.
'LI$s are responsible for increasing popularity of insurance as an investment tool
73

DISTRI=UTION C9ANNEL PREFERENCE
!H.44+7 P1+F+1+4!+
86 17 14 9 4
0 20 40 60 80 100 120
1
3nown7/*''en" A+v$so' ,'$en+s -ela"$ves
8'o*9 )ns*'an%e Ban%%ass*'an%e
0elesales7*nknown A+v$so'
"ccording to the data, knownFcurrent "dvisors remains the +
st
choice for buying Insurance.
In retail also known "dvisors are preferred over referrals.
/ancassurance is emerging as a popular option for buying life Insurance.
7roup insurance is a channel which customers expect but it is not so popular because only
few employers have taken the initiative.
/uying insurance from a unknown person or getting a phone call is still not preferred by
most of the people
74

CONCLUSION
72

CONCLUSION
&he various conclusions drawn from the pro>ect are5
&here has been a tremendous change in the insurance industry. "nd with it there has been
continuous growth in this sector both in Indian as well as world context.
&he opening up of the insurance sector has changed the whole look of the industry. Ehile the
LI*, in order to face the competition is coming up with new strategies. :ew private players are
leading the sector due to their strategic management and tailored made pro>ects.
#rom the research, we also conclude that though the awareness and people opting for LI*
plans are more as compared to other private players% but the latter are gaining momentum in
the market day by day.
&he demand for insurance is likely to increase with rising per!capita income, rising literacy
rates, and growth of service sector. In!fact opening up of the insurance sector is an integral part
of the liberali6ation process being persued by many developing countries.
Life insurance as a form of protection is the single!most important financial product any
earning member of a family must have. Daving said this, a well!diversified portfolio is one of
the first rules of financial planning, and as such one should consider different instruments as
the ability to save increases.
$ossible investment options range from bank deposits and government small saving schemes to
mutual funds, stocks and property.
7:

*ertainly 'LI$s successfully combine the first and most important need of protection, with
savings, and hence are an excellent addition to your portfolio.
"ll financial products have a certain amount of risk and charges, be it a mutual fund, property,
or even a bank deposit. It would be unrealistic to assume that the features and benefits of a
'LI$ come at no cost, though the charges are considerably lower than that of a traditional
product.
In fact, the very reason the product is transparent is because the customer knows the charges
and risks.
&here is no right or wrong in this. &he success of marketing insurance depends on
understanding the social and cultural needs of the target population, and matching the market
segment with the suitable intermediary segment. "ll intermediaries can%t sell all lines of
business profitably in all markets. &here should be clear demarcation in the marketing
strategies of the company from this perspective. *lients should also receive price differentials
for using different channels.
&he intermediaries need to be empowered with the right learning, training and sales tools and
technology enablers. *oupled with the right product mix, this will help the insurers to survive
and flourish in this competitive market scenario. S) !et$ +)%-&+t ti$ (&$i%e$$ wit &t')$t
e+)%)'/ wit te $,irit )* tr&$tee$i,R tere(/ '"4i%# i%$&r"%+e wi-e!/ ,),&!"r0
75

LIMITATIONS
77

LIMITATIONS
It was difficult to collect some information because of some company rules.
Interaction with the employees was limited because of the work schedule.
It was difficult to cover all the types of ratios because of lack of information i.e. regarding
inventories, debtor%s turnover etcV..
7>

RECOMMENDATION
>3

RECOMMENDATION
$ositioning insurance as a means to fulfilling one%s duties during one%s lifetime.
#ears relating to thefts, ailments, death could be addressed through Wsensitive%
communication
Fe"r$ re!"ti%# t) +!"i'$; :eed to promote XtrustO. Demonstrating claim testimonials,
positioning as Xworry freeO.
L)w ret&r%$; eposition insurance as a risk cover, security instrument rather than a
financial investment.
L"+4 )* &%-er$t"%-i%#; &raining of *hannels
&o provide ?uality advice on products best suited
L"+4 )* G%)w!e-#e; Iase of $rocess, simplifying the product and the procedure
:eed to promote the ?uality of awareness
Te (e%e*it$; Leverage on isk $rotection or eturns oriented or both
Te ,r)-&+t; catering to life stages
Nee- *)r =r"%-i%# i% I%$&r"%+e; /randing is more relevant in the Insurance market
which not only faces the problem of securing and retaining customers in an increasingly
competitive marketplace but also experiences the need for heightened relevance of the
brand proposition in a world where brand has been termed the new religion.
In rural India, the LI* is especially synonymous with insurance. /ut in the wake of
competition insurance companies have to do a considerable brand building exercise at
least in urban India.
"de?uate time, investment and longer!term management of the brand are essential, not
only for success but also survival. "ll brands need to be built around well!differentiated
>1

and credible positioning that springs from the organi6ation%s history. &he brand must
not only be believed but lived by management and employees.
#ocus on different segments to survive and thrive in a competitive environment. Iach
company has to choose its own uni?ue positioning based on its uni?ue strengths. /elow!
mentioned positioning alternatives can be worth considering.
VARIETY-=ASED POSITIONIN6
&his type of positioning is based on varieties in products and services rather than customer
segments. It is a sensible strategy for those companies who have distinctive advantages or
strengths in offering certain products and services. In the insurance industry too, it is
possible to achieve a uni?ue position by focusing on certain category of products.
NEEDS-=ASED POSITIONIN6
&his is the most commonly understood positioning and is based on the differing needs of
different groups of consumers. &his can be done successfully if a company has uni?ue
strengths to service a group of customer needs better than others.
&he insurance needs of customers vary significantly for different groups of customers. &he
insurance needs of young family with small children will be ?uite different from that of a
family in which the income!earner is close to retirement. Dowever, in India most of the life
insurance companies have a wide variety of products tailored for different customer needs
and there is no company focusing on a particular customer need.

>2

ACCESS-=ASED POSITIONIN6
$ositioning of customers can also be done by the way they are accessible. &hat is different
groups of customers may be accessible in different ways even though they may have
similar needs. "ccess is typically a function of customer geography or customer scale.
&here is excellent opportunity in the insurance industry to employ access!based positioning
by targeting the rural insurance sector.
&he rural market for life insurance is very different from the urban market in terms of
needs, income levels and distribution 9seasonality, for example;, penetration of media and
so on. ural market can be a highly profitable position if one is able to carefully plan and
tailor an entire set of low!cost activities of advertising, distribution, and product design etc.
to successfully exploit the potential.
>3

=I=LIO6RAP9Y
>4

=I=LIO6RAP9Y
=OOGS
Marketing Management ,/y $hilip kotaler
Marketing of 4ervice /y Dr. 4.L 7upta and M.M. atna
#inanaial Management /y I.M.$anday
Iconomics &imes
We($ite$
www0r(i0)r#0i%
www0ir-"i%-i"0)r#
www0("%4%eti%-i"0+)'
www0-*+i%$&r"%+e0+)'
www0(&$i%e$$w)r!-)%!i%e0+)'
www0#))#!e0+)' 9search engine;
Oter Re*ere%+e$;
/rochures of various plans

>2

SUESTIONNAIRE
>:

R' ESTIONNAIRE
:ame5 YYYYYYYYYYYYYYYYYYYYYYYY
"ge5 YYYYYY
7ender5 M #
Marital 4tatus5 Married 4ingle
Occupation5 YYYYYYYYYYYYYYYYYYY
*ontact :o5 YYYYYYYYYYYYYYYYYY
"nnual Income 9appx. in s.;
'pto +.08 lacs +.08 lacs!= lacs
= lacs!0 lacs above 0 lacs
R+; "re you aware about Wwhat is financial planning%P

HI4 :O
R.; Mention the names of Life insurance companies you have heard of5
+; YYYYYYYYYYYYYYYY 2; YYYYYYYYYYYYYYYY
.; YYYYYYYYYYYYYYYY 0; YYYYYYYYYYYYYYYY
=; YYYYYYYYYYYYYYYY 1; YYYYYYYYYYYYYYYY

>5

R=; Dow much do you save approximately of your annual incomeP
YYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYY
R2; where do you investFwould like to invest your savingsP
9ank in order of preference, + being most preferable;
/anks 4hare Market
Insurance /onds G 4ecurities
Mutual #unds eal IstateF$roperty
R0; Dave you taken any life insurance policy on your own life or on life of any of your family
memberP

HI4 :O
9If no, switch to R -;

R1; which company9s; policy9s; you haveP
LI* I*I*I $'DI:&I"L
/IL" 4':LI#I I:7 MH4H"
/"<"< "LLI":Z 4/I LI#I
DD#* 4&D. LI#I &"&" "I7
>7

M"U :IE HO( LI#I "MIM"
ILI":*I (O&"( M"DI:D"
MI& LI#I O&DI YYYYYYYYYYYY 9specify;
R3; which type of plan did you buyP
Money /ack $lan
Indowment $lan
$ension $lan
'LI$
R,; Ehat was your purposeFwill be your likely purpose of taking insuranceP
":( &DIM 9+ being most ideal;
a; $O&I*&IO:
O# #"MILH
b; &"U /I:I#I&
c; I:MI4&MI:&
d; I&IIMI:&

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