CHAPTER 1:

HDFC STANDARD LIFE INSURANCE AND ITS COMPETITORS

1.1 PROFILE OF THE COMPANY 1.2 INDUSTRY OF THE ORGANISATION 1.3 COMPANYS VISION & MISSION. 1.4 PRODUCT RANGE OF THE COMPANY. 1.5 SIZE OF ORGANIZATION 1.6. ORGANIZATION STRUCTURE OF THE COMPANY. 1.7. MARKET SHARE & POSITION OF THE COMPANY IN THE INDUSTRY. 1.8. SOURCES OF DATA COLLECTION

HDFC STANDARD LIFE INSURANCE CO. LTD

1.1 PROFILE

HDFC- HOUSING DEVELOPMENT AND FINANCE CORPORATION.

HDFC Standard Life is a joint venture between HDFC of India and Standard Life of UK. The new company, Hdfc Standard Life, was one of the first to be awarded a license in the

recently deregulated Indian market and one of the first to open its doors for business and issue policies. Founded in 1977, HDFC id Indias market leader in housing finance, providing finance for more than 1.5mn homes. They have 83 offices in India, one international office in Dubai and three service associates in Kuwait, Qatar and the Sultanate of Oman. Like Standard Life, HDFC is strongly committed to providing quality products and excellent customer service and has won a number of important awards : in Jan 2001 Asiamoney named them as second Best managed company in India. HDFC is also financially very strong and for the last six years has enjoyed the highest financial strength ratings from Indias two leading rating agencies.

The HDFC group includes:

HDFC Bank HDFC Asset Management HDFC Realty Ltd. HDFC Securities Limited

INTEGRATED FINANCIAL SERVICES

HDFC HOME LOANS

HDFC DEPOSITS

HDFC
realty.com

HDFC SLIC

CENTRE FOR HOUSING FINANCE

HDFC

HDFC MUTUAL FUNDS

HDFC BANK

SECURITISATION FUTURE ACTIVITIES

Over the period of operations, HDFC group has been felicitated with various rewards. Some of them SECURITIES are as follows:
CIBIL i.e CREDIT United Nations Scroll of Honor 1991 HDFC CHUBB DISTRIBUTION best managed company by Asiamoney magazine 1995 and 1996 Indias GENERAL INSURANCE CO. LTD Most competitive Indian company by Euromoney 1997 INFORMATION BUREAU LTD. HDFC INTELNET

One of the 5 best Indian Boards by Business Today 1997 Rated as one of the best companies in India for strategy & management and investor relations by Asia money 1998.

Excellence in service industry by the Indian Institute of Marketing Management & Top Management Club (Pune) 1998

Shield for the best presented accounts for banks and financial institutions over 11 times (last 8 years in a row).

HISTORY OF THE JOINT VENTURE

Discussions commenced -- January 1995 Joint Venture agreement signed October 1995 Joint venture agreement renewed October 1998 Life insurance project team established January 2000 (Mumbai) Company officially incorporated - 14th August 2000 First Private Sector Life Insurance company to be granted a certificate of registration 23rd October 2000 Shareholding HDFC Standard Life 81.4% 18.6%

1.2 THE INSURANCE INDUSTRY

INTRODUCTION
The insurance sector in India has come a full circle from being an open competitive market to nationalisation and back to a liberalised market again. Tracing the developments in the Indian insurance sector reveals the 360 degree turn witnessed over a period of almost two centuries. With such a large population and the untapped market area of this population Insurance happens to be a very big opportunity in India. Today it stands as a business growing at

the rate of 15-20 per cent annually. Together with banking services, it adds about 7 per cent to the countrys GDP. In spite of all this growth the statistics of the penetration of the insurance in the country is very poor. Nearly 80% of Indian populations are without Life insurance cover and the Health insurance. This is an indicator that growth potential for the insurance sector is immense in India. It was due to this immense growth that the regulations were introduced in the insurance sector and in continuation Malhotra Committee was constituted by the government in 1993 to examine the various aspects of the industry. The key element of the reform process was participation of overseas insurance companies with 26% capital. Creating a more efficient and competitive financial system suitable for the requirements of the economy was the main idea behind this reform. Since then the insurance industry has gone through many sea changes .The competition LIC started facing from these companies were threatening to the existence of LIC. Since the liberalization of the industry the insurance industry has never looked back and today stand as the one of the most competitive and exploring industry in India. The entry of the private players and the increased use of the new distribution are in the limelight today.

INSURANCE SECTOR REFORMS

In 1993, Malhotra Committee, headed by former Finance Secretary and RBI Governor R.N. Malhotra, was formed to evaluate the Indian insurance industry and recommend 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 suitable for the requirements of the economy keeping in mind the structural changes currently underway and recognising that insurance is an important part of the overall 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 recommendations 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. 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%

The committee emphasized that in order to improve the customer services and increase the coverage of the insurance industry, it should be opened up to competition. But 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 crores. 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 Regulatory and Development Authority

Reforms in the Insurance sector were initiated with the passage of the IRDA Bill in Parliament in December 1999. The 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. The other decisions taken simultaneously to provide the supporting systems to the insurance sector and in particular the life insurance companies was the launch of the IRDAs 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.

CURRENT SCENARIO OF THE INDUSTRY INSURANCE MARKET IN INDIA

India with about 200 million middle class household shows a huge untapped potential for players in the insurance industry. Saturation of markets in many developed economies has made the Indian market even more attractive for global insurance majors. The insurance sector in India has come to a position of very high potential and competitiveness in the market. Life insurance industry is waiting for a big growth as many Indian and foreign companies are waiting in the line for the green signal to start their operations. The Indian consumer should be ready now because the market is going to give them an array of products, different in price, features and benefits. How the customer is going to make his choice will determine the future of the industry.

1. CUSTOMER SERVICE
Consumers remain the most important centre of the insurance sector. After the entry of the foreign players the industry is seeing a lot of competition and thus improvement of the customer service in the industry. Computerisation of operations and updating of technology has become imperative in the current scenario. Foreign players are bringing in international best practices in service through use of latest technologies. The one time monopoly of the LIC and its agents are now going through a through revision and training programmes to catch up with the other private players.

2. DISTRIBUTION CHANNELS
Till date insurance agents still remain the main source through which insurance products are sold. The 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.

3. PRODUCT INNOVATION
There has been a plethora of new and innovative products offered by the new players. Customers have tremendous choice from a large variety of products from pure term (risk) insurance to unit-linked investment products. Customers are offered unbundled products with a variety of benefits as riders from which they can choose. More customers are buying products and services based on their true needs and not just traditional money-back policies, which is not considered very appropriate for long-term protection and savings.

4. RURAL MARKETING
Rural India seems to have an appetite for mobile phones, computers, and cars and to add to it we have insurance. In India with the private players having entered into the insurance industry, the expected explosion in job opportunities may not actually happen but for them the catchments area is the opportunities in the rural India. In India the insurance business can be said to be "a marathon, not a sprint".

5. INFORMATION TECHNOLOGY AND INSURANCE

In the insurance industry today, there is a clear trend away from selling a broad range of products to a large volume of customers in a one size-fits-all manners. Instead of focusing on their different products lines as silos (i.e., life, property and casualty etc) insurers are looking for ways to offer highly targeted insurance products that are tailored to the individuals customers with the highest propensity to buy them.

1.3 MISSION STATEMENT OF HDFC SLIC :

We aim to be the top new life insurance company in the market.

This does not just mean being the largest or the most productive company in the market, rather it is a combination of several things like

Customer service of the highest order Value for money for customers Professionalism in carrying out business Innovative products to cater to different needs of different customers Use of technology to improve service standards Increasing market share.

VISION STATEMENT
The most successful and admired life insurance company, which means 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.

1.4 RANGE OF PRODUCT AND SERVICES

Group Term Insurance: HDFC Standard Life Insurance offers a Group Insurance scheme for companies called 'Group Term Insurance'. This product has been designed to offer innovative features and a high degree of customization.. Gratuity Plan The HDFC Gratuity Plan is an insurance policy, which offers you, as an employer and gratuity scheme trustee, a new and flexible way to fund your gratuity liability. The contributions that you decide to invest in this policy will assist you in meeting your gratuity obligations in a systematic manner. Development Insurance Plan:

This product is well suited for the economically weaker sections of society and caters specifically to their needs. It make available life cover at affordable rates. For further details on the Development Insurance Group Term Insurance - HDFC Standard Life Suitability

This plan has been designed for an employer to take insurance for all

or certain categories of their employees (e.g. - employees in a particular grade/ designation). All members of the group, subject to some basic insurability conditions, are eligible for membership. Salient Features

It is one year term renewable plan A single master policy is issued covering all the employees. The The policy can be taken as a substitute for the statutory EDLI (subject The members do not need to undergo any medical examination up to

premiums can be paid either by the employees or employer

to approval by RPFC)

the "Free Cover Limit". This limit is dependent upon the sum assured and the size of the group. Benefits On Death Sum assured designated for the employee will be paid. Other Conditions

Minimum group size:25 members minimum sum assured : Rs.20,000 per person Minimum age at entry : 18 years Maximum age at entry : 64 years or 1 year lower than the normal

retirement age Exclusions

The policy does not cover suicide in the first policy year.

Money Back Policy (HDFC - Standard Life)

Suitability

The policy is suitable for people who wish to receive amounts at

regular intervels during one's career to meet contingencies or for re-investment, all the while having life insurance protection. Salient Features

A policy where lump sum amounts are paid to the life assured at In case of death of the life assured within the term, the total sum Bonus is payable under this scheme. Basic sum assured plus any bonus additions less the previous cash

periodic intervals on survival

insured is paid to the nominee, irrespective of earlier survival benefits

Benefit On Survival

lump sums is provided. On Death

Basic sum assured plus any bonus additions is provided irrespective

of earlier survival benefits. Other Conditions

Minimum term: 10 years Maximum term: 30 years

Children's Plan (HDFC) Suitability

The

plan

is

suitable for people who wish to provide for their children's higher education/marriage.

Salient Features

This is a flexible endowment plan taken on the life of the parent for

the benefit of the child.

Policy is offered in three variants. Options available are o 1. 2. 3. Maturity Benefit Plan Accelerated Benefit Plan Double Benefit Plan The policy provides financial security to the child in the future, by

providing lumpsum amounts either on maturity or on unfortunate death of the parent(life assured) during the policy term, which ever is earlier. However benefits vary depending upon the option chosen.

Bonus is paid under the policy. Premiums are payable till death or till maturity which ever is earlier. The premiums paid will be eligible for tax relief under Section 88 of

the Income Tax Act, 1961. The benefits received under the policy are eligible for tax relief under Section 10(10D) of the Income Tax Act, 1961.

Premium can be paid either in yearly, half-yearly or quarterly modes,

depending on your convenience.

Other Conditions

Minimum Age at Entry: 18 years Maximum Age at Entry: 60 years Minimum Age at Maturity : 75 years Maximum Term : 10 years Maximum Term : 25 years If the death of the life assured has occurred directly or indirectly as a result of suicide within one year of the date of commencement or the date of issue, if later, no benefit is payable and the policy will lapse without any value.

Exclusions

Endowment Assurance Plan (HDFC Standard Life)

Suitability The policy provides for family protection as well as old age provision. This policy is suitable for all categories of people, Salient Features

Lump sum amount is payable on survival to maturity or on death, whichever is earlier. Premiums are payable till the end of payment term chosen or death which ever is earlier. However in case of plans where Waiver of Premium benefit has been availed, premiums are not payable during the period of disablement.

Premiums paid under the policy are eligible for tax rebate under section 88 of Income Tax Act 1961. Benefits under the policy can be enhanced by opting for riders. Riders are the additional benefits which can be availed by paying marginal additional premium. Riders available under the plan are: 1. Double Sum Assured 2. Accidental Death Benefit 3. Waiver of Premium 4. Critical Illness

Benefits On Death

Basic Sum Asured + Bonus is payable Basic Sum Asured + Bonus is payable Double Sum Assured (DSA):This benefit provides for an additional Accidental Death Benefit (ADB):This benefit provides for an

On Survival

Riders

amount equivalent to the basic sum assured in case of unfortunate death.

additional amount equivalent to the basic sum assured in case of death due to accident.

Waiver of Premium (WOP):By the virtue of this benefit all future

premiums stand waived in case of total disablement of the life assured. The waiver applies during the period of total disability.

Critical Illness (CI):This benefit will provide for an additional

amount equivalent to the basic sum assured on insured contracting to any of the six specified critical illnesses. Critical illness benefit will be paid on insured surviving 30 days from the date of claim. This benefit comes to an end once the claim is paid, however basic policy continues. Other Conditions

Minimum term: 10 years Maximum term: 30 years The minimum and maximum ages at entry under the plan are as
Min.age at entry CI DSA ADB 18 18 18 55 60 55 70 75 65

follows:
Basic Plan Min.age at entry Max.age at entry Max. age at maturity 12 60 75 WOP 18 50 60

Exclusions

The company will not be liable to pay the benefit amount, if the death

of the life assured is caused directly or indirectly by suicide within one year of the date of commencement, or the date of issue of the policy, if later.

Intentionally self-inflicted injury or attempted suicide, irrespective of Alcohol or solvent abuse, or the taking of drugs except under the

mental condition.

direction of a registered medical practitioner. Salient Features

It is a term assurance policy which provides the financial security to Premium can be paid either in yearly, half-yearly, quarterly modes or

the family in the unfortunate event of death of the life assured within the term.

single one-time premium.

Policy holder can avail additional benefits by paying marginal 1. 2. 3. Benefits Accidental Death Benefit Critical Illness Benefit Accelerated Sum Assured Benefit

additional premium. Additions benefits available are:

On survival

No benefits are payable on survival to the end of the term of the policy.

On death

Sum assured is payable in case of death of the life assured during the term of the contract. Additional benefits

Accidental Death Benefit (ADB)

Accidental Death Benefit provides an additional amount equal to the basic sum assured in case life assued dies: - due to an accident, and - within 90 days of the accident.

Critical Illness Benefit (CI)

Critical Illness Benefit is payable on diagnosis of any one of the 6 common critical illnesses covered under the policy. On survival for 30 days after the date of the claim, the sum assured is payable. Once such a claim has been paid, no further Critical Illness Benefit is payable, however, basic policy continues.

Accelerated Sum Assured Benefit (ASA)

The rider pays an amount equal to the amount payable on death in the event of policy holder contracts any of the 6 common critical illnesses covered under the policy. Once the claim is admitted under this rider, basic policy terminates without value. This benefit accelerates or advances the date on which the benefit would be payable. It becomes payable on death or critical illness, whichever occurs earlier.

Once a claim has been met, either on death or critical illness, no further benefit is payable. Critical Illness Benefit and Accelerated Sum Assured Benefit are not simultaneously available on a single policy. Exclusions The benefit amount is not payable if the death of the Life Assured or the death of the first to die of the Lives Assured is caused directly or indirectly by suicide within one year of the date of commencement, or the date of issue of the Policy, if later. Accidental Death Benefit is not payable if death is caused 1. 2. Suicide within one year of the date of commencement Alcohol or solvent abuse, or the taking of drugs directly or indirectly from any of the following: or the date of issue of the Policy, if later. except under the direction of a registered medical practitioner.

Flexible Bond - HDFC Standard Life

Single Premium Whole of Life Suitability o returns. Salient Features o o It is a single premium policy. Premiums paid under the policy are Policy holder has the option to receive sum assured + bonus on 10th, invested in the company's(HDFC Standard Life) With Profit Fund 15th, 20th and subsequent five-yearly anniversaries. Once the money has been taken policy ceases. o The company will declare a compound reversionary bonus every year which will be added to the policy on its anniversary. It is a single premium policy providing risk cover, liquidity and

o o On survival

In additions to the bonus, the company, based on its performance may Policy holder can surrender the policy anytime after it has been in

pay terminal bonus on surrender or death or on guaranteed dates. force for a period of 6 months. There is no maturity period and policy holder has the option to receive sum assured + bonus on 10th, 15th, 20th and subsequent five-yearly anniversaries. Once the money has been taken policy ceases. On Death

Provided that the policy is in force, sum assured secured by the premium plus attached bonus is payable.

Other Conditions

Minimum sum assured :Rs. 25,000 Maximum sum assured:Rs. 5,00,000 Minimum age at entry : 18 years Maximum age at entry : 70 years

Development Insurance Plan-HDFC Standard Life Suitability

This product has been designed for the benefit of the economically weaker sections of society and caters specifically to their needs. It offers life cover at affordable rates. It is administered through development agencies

Salient Features

It is one year term assurance plan providing life cover to the specified group Premiums are quoted for each member of the group. Premiums shall be collected by the development agency and paid as lump sum to the insurer. Cover starts only after the entire premium have been paid and information regarding each member of the group has been given to the insurer in the required format.

Development Agencies play a key role in administration of this policy. Due to the nature of the groups covered insurer shall pass on certain duties to the development agency with include:

1. 2. the insurer 3. 4. Benefits On Death

Submission of member data in a specified computer format Collection of premiums from group members and payment to Recording changes in the details of group members Reporting of the claims to the insurer and Disbursement of claim payments and the mortality rebate (if any) to group members On the death of any member of the Group Insured during the year of cover, a lump sum is paid to that member's beneficiaries. In case of death due to an accident additional sum equal to half the sum assured will be paid.

Other Conditions

Minimum age: 18 years as on last birthdate Maximum age: 50 years as on last birthdate Minimum group size: 500 members

1.5. ORGANIZATIONAL STRUCTURE OF THE COMAPANY

1) Mr. Deepak s. parekh (chairman ) 2) Mr.keki m. mistry ( board of director ) 3) Ms. Renu s. karnad (managing director) 4) Ms. David nish (board of director)
5) Mr. Nathan Parnaby (board of director ) 6) Mr. Norman K. Skeoch (chief executive and board of director ) 7) Mr. Ravi Narain (board of director)

8) Mr. A. K.T. Chari (board of director) 9) Ms. Vibha Padalkar ( executive director and chief financial officer)

10) Mr. Gautam R. Divan ( board of director) 11) Mr. Ranjan Pant (board of director ) 12) Mr. S.A. dave (board of director )
13)Mr. Gerald E. Grimstone (board of director ) 14)Mr. Michael G Connarty (board of director ) 15)Mr. Amitabh Chaudhry (board of director

1.6. SIZE AND TURNOVER OF THE ORGANIZATION

Standard Life is headquartered in Edinburgh and employs around 9,000 people across the UK, Canada, Ireland, Germany, Austria, India, USA, Hong Kong and mainland China. At the end of March 2012 the Group had total assets under administration of 206.8bn. Standard Life plc is listed on the London Stock Exchange and has approximately 1.5 million individual shareholders in over 50 countries around the world. Standard Life is proud to support basketball in the UK. It has partnered with British Basketball to sponsor the Standard Life GB Men's, Women's, Under 20 Men's and Under 20 Women's teams and their home games. It has also partnered with British Wheelchair Basketball to sponsor the Standard Life GB Men's and Women's Wheelchair Basketball Teams and their home games The GB Men's and the GB Women's Basketball and Wheelchair Basketball Teams have qualified for the Olympic Games in 2012.

1.7 Market share of the HDFC

Strong growth in premium income and assets under management Total premium grew by 25.9 percent to Rs. 70.1 bn. New business received premium including first year and single premiums grew by 20.5% to Rs. 32.6 bn.

First year regular premiums increased by 17.5 percent to Rs. 29.8 bn. Single premiums, including single premium top-ups, increased by 65.6% to Rs. 2.7 bn.

 Renewal premium constituted 53.5 percent of total premiums (2008-09: 51.4 percent) and grew by 31.0 percent to Rs. 37.5 bn. Our weighted received premium (10 percent weightage for single premium) growth during the year at 27.5 percent was higher than the growth for the private sector (13.0 percent) The growth achieved by the company was considerably higher than the private sector industry average of 84% for 2011-12. HDFC Standard Lifes Effective Premium Income (EPI) grew by 103% from Rs. 436.08 crore to a commendable Rs. 887.30 crore.

PRESENT MARKET SHARE OF THE COMPANY AND ITS COMPETITIORS

Market Players and their respective share in the Insurance Industry, as on December 2011

NAME OF THE PLAYER

LIC ICICI PRUDENTIAL BIRLA SUN LIFE BAJA ALLIANZ SBI LIFE HDFC STANDARD TATA AIG MAX NEW YORK AVIVA KOTAK MAHINDRA

MARKET SHARE (%)

82.3 5.63 2.56 2.03 1.80 1.36 1.29 0.90 0.79 0.51

ING VYASA AMP SANMAR METLIFE

0.37 0.26 0.21

CHAPTER 2:

SWOT ANALYSIS OF THE COMPANY 2.1. STRENGTHS & WEAKNESSES OF THE COMPANY 2.2. OPPORTUNITIES & THREATS THAT THE COMPANY FACES. 2.3. USP OF THE COMPANY 2.4. MARKETING STRATEGY

SWOT ANALYSIS (HDFC STANDARD LIFE INSURANCE COMPANY LIMITED)

SWOT Analysis is mainly used to find out the specific areas in the companys operations which need more care and attention, by comparing them with that of the competitor. Here S means Strengths of the company, W means Weaknesses of the company, O means Opportunities and T means Threats to the company. Both Strengths and Weaknesses are inherent with the company while Opportunities and Threats are usually outside factors, which affect the existence of the company at large. Let us make the SWOT Analysis for all the players mentioned so far, ie., Life Insurance Corporation, ICICI Prudential and HDFC Standard Life Insurance. together so that the reader will get a comprehensive idea.

2.1. STRENGTHS
Premiums are increasing and so are commissions. The variety of products is increasing. Transparency in working is followed. Fund charges are less i.e 0.8% Stronger financial base. Employee centric organization.

WEAKNESSES
Strong competitors like LIC, ICICI Pru, Birla Sun Life etc. Premium is priced high as compared top the market leader. Infrastructure cost is high. Less expenditure on promotion. Products not customized for lower segment. Do not have a strong and efficient agency network

As a private company the people do not have that much belief

2.2. OPPORTUNITIES
The ability to cross sell financial services barely being tapped. Technology is improving to the point that paperless transactions are available. The client's increasing need for an "insurance consultant" can open new ways to service the client and generate income. The high growth rate of Indian Economy The penetration of Insurance in the rural area is minimal. This has to be explored. The Government policies are offering more and more rebates on the insured amount and such a scenario will help more people getting interested in it. The people are becoming more aware of Insurance and have started considering it as a necessity.

THREATS
Government regulations on issues like health care, mold and terrorism can quickly change the direction of insurance. The increasing expenses and lower profit margins. Now as India is on the brim of emerging out as an economic power centre, stringent laws can be expected in the coming future.

2.3. Companys USP :

USP is something that the customer will have to find because life insurance is a longterm process and it is about stability, being conservative. We don't hear about aggressive life insurance companies who survive for a longer period.To be in business when we are talking of an insurance policy for say 30 years, your perspective is different in comparison to when you are taking a short term loan say a car loan for 3 years. Therefore different companies have chosen different models. Some of them have chosen to be in for the long run while some have chosen to be in for the short run. For in the short run, you need to have a high valuation of company, for high valuation you need to have high & rapid sales. Higher the sales higher are the valuation & higher the valuation higher is the price that you can charge. Anything that hurts the long-term interest of the company is not allowed in HDFC and that is the companys USP.

2.4 MARKETING STRATEGY

TAG line:- Making Life Easier for you. - With this particular punch line HDFC

Std. Life has been able to make a great impact in the minds of the potential customer are being communicated that a lot of worries of their lives are being taken care of by the company so that they can now enjoy their life in a much more better manner in a comparatively less stressful manner. Workstation Marketing:- Customers coming to the office of HDFC SLICL were given a detail about the various products at the office itself, by almost any official they meet, so that the product can be sold to the customer at that time only if the customer gets interested. Corporate Marketing:- Company officials often go to various corporate houses to make presentations regarding various products they are offering. They are even ready to sell the policies then and there, in case customer wants. This is specially taken care of because, if given any time, customer might go to the competitor. Stall In Trade Fair:- This strategy is basically undertaken to expose general public to various life insurance products available of HDFC SLICL. Also this strategy helps generating leads. This is short-term strategy as is limited to duration of such trade fairs and all.

Road Shows:- This strategy is aimed at reaching more and more customers by Awareness Camps:- This is one of the strategies which has the greatest effect on

moving to various places. the mindset of the prospective customers and is considered to be the most effective. Most of the Indian population is still unaware of life insurance as such and the various benefits which life insurance carries for them. Thus, making people aware of these things will definitely help company increasing its sales. Segment Targeting Through Consultants:- This is a unique strategy in itself and is a new concept in itself. We know that every insurance company has consultants or agents. Now HDFC SLICL has targeted their customers into various segments like transporters, doctors, housewives, teachers, etc. and has made one person out of them as their consultant. Thus, this helps them cater to the whole segment since person of same level can easily influence others. This strategy has infact done well till now. Distribution: Different companies may however choose different channels and different geographies to focus on. The channel options are - tied agency force, corporate agents and brokers and this is an area where different companies will make different choices. Many companies like HDFC Standard Life are focussing on all channels whereas companies like Max New York Life are focussing on the tied agency force only.

CHAPTER 3:

3.1. MARKET ANALYSIS 3.2. FINANCIAL ANALYSIS

MARKET ANALYSIS

COMPETITORS INFORMATION
LIFE INSURANCE CORPORATION MARKET LEADER The Life Insurance Corporation of India (LIC), a public sector enterprise, is the largest insurance company in India, selling insurance products and related services. In March 2001, LIC had a total asset base of Rs.1936.2 billion and a total premium income of Rs.342.07 billion. By April 2008, the total sum assured under 23.2 million policies stood at Rs.1925.7 billion. LIC has a variety of insurance plans to cater to various categories of people and their diverse needs. The company offered life insurance and group insurance. It also provided social security schemes and pension schemes. Each of its business products offered a variety of different plans to suit different customers and situations. Investment in LIC was considered by a majority of its customers to be reliable and secure. The company, which was based in Mumbai, had seven zonal offices, 100 divisional offices, and 2,048 branch offices that spanned the country. LIC's penetration in rural areas was very high; 18% of its total business came from rural areas.

VISION :
"A trans-nationally competitive financial conglomerate of significance to societies and Pride of India"

MISSION
"Explore and enhance the quality of life of people through financial security by providing products and services of aspired attributes with competitive returns, and by rendering resources for economic development."

TYPES OF PLANS OFFERED:

1. INDIVIDUAL PLANS 2. GROUP SCHEMES 3. PENSION PLANS

INDIVIDUAL PLANS
1. WHOLE LIFE SCHEMES a. WHOLE LIFE WITH PROFITS b. LIMITED PAYMENT WHOLE LIFE c. SINGLE PREMIUM PLAN

2.

ENDOWMENT SCHEMES
a. Endowment plan with profit b. Limited payment endowment c. Jeevan Mitra (Double cover) d. Jeevan Mitra (Triple cover) e. Jeevan Anand

3.

TERM ASSURANCE PLAN

a. Jeevan Anurag b. Komal Jeevan c. Jeevan Kishore d. Jeevan Chhaya

4. PERIODIC MONEY BACK PLAN

a. Bima Gold b. Jeevan Rekha Plan

c. Money Back Plan d. Jeevan surabhi e. Jeevan Bharati

5.

FOR BENEFIT OF HANDICAPPED

a. Jeevan Aadhar b. Jeevan Vishwas

6.

JOINT LIFE PLAN

a. Jeevan Saathi

7.

PLAN FOR HIGH-WORTH INDIVIDUAL

a. Jeevan Shree-I b. Jeevan Pramukh

8.

SPECIAL PLAN
a. b. Jeevan Saral Future Plus

GROUP SCHEMES
1. Group Term Insurance Scheme 2. Group Gratuity Scheme 3. Group Super-annuation Scheme 4. Group Savings Link Insurance Scheme

PENSION PLANS
a. Jeevan Nidhi b. Jeevan Akshay III c. New Jeevan Dhara I

d. New Jeevan Suraksha I e. Future Plus

2.2.1 ICICI PRUDENTIAL

ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank, a premier financial powerhouse and Prudential plc, a leading international financial services group headquartered in the United Kingdom. ICICI Prudential was amongst the first private sector insurance companies to begin operations in December 2000 after receiving approval from Insurance Regulatory Development Authority (IRDA). ICICI Prudential's equity base stands at Rs. 9.25 billion with ICICI Bank and Prudential plc holding 74% and 26% stake respectively. In the financial year ended March 31, 2005, the company garnered Rs 1584 crore of new business premium for a total sum assured of Rs 13,780 crore and wrote nearly 615,000 policies. The company has a network of about 56,000 advisors; as well as 7 banc assurance and 150 corporate agent tie-ups. For the past four years, ICICI Prudential has retained its position as the No. 1 private life insurer in the country, with a wide range of flexible products that meet the needs of the Indian customer at every step in life. Continuing with its 'Customer First' philosophy, ICICI Prudential has significantly expanded its presence to 29 operational Branches (2001-2002: 16), with the Advisor. Force growing to over 18,000. Its has also strengthened its Alternate Distribution channels, i.e. Banc assurance, Corporate Agents and Direct Marketing, making purchase of insurance more accessible. Banc assurance and Direct Marketing channels have contributed to over 18% of the Annualized Premium. ICICI Prudential was amongst the first to identify the emerging opportunity in the Pension segment and launched two linked pension products- Life Time Pension and Life Link Pension, which have been well received in the market. ICICI group

ICICI Bank is India's second-largest bank with total assets of about Rs.1,676.59 bn(US$ 38.5 bn) at March 31, 2005 and profit after tax of Rs. 20.05 bn(US$ 461 mn) for the year ended March 31, 2005 (Rs. 16.37 bn(US$ 376 mn) in fiscal 2004). ICICI Bank has a network of about 573 branches and extension counters and over 2,000 ATMs. ICICI Bank offers a wide range of banking products and financial services to corporate and retail customers through a variety of delivery channels and through its specialized subsidiaries and affiliates in the areas of investment banking, life and nonlife insurance, venture capital and asset management. ICICI Bank has formulated a Code of Business Conduct and Ethics for its directors and employees. At September 20, 2005, ICICI Bank, with free float market capitalization* of about Rs. 400.00 billion (US$ 9.00 billion) ranked third amongst all the companies listed on the Indian stock exchanges.

Prudential group
Prudential began its first Asian operations in India in 1923. Today, it is the leading European life insurer in Asia, employing over 8,700 staff and serving more than 5.7 million customers.

Prudential Corporation Asia has 23 operations in 12 countries, namely: China, Hong Kong, India, Indonesia, Japan, Korea, Malaysia, the Philippines, Singapore, Taiwan, Thailand and Vietnam.

Prudential Corporation Asia is Europe's leading life insurer in Asia in terms of market coverage and number of top five market positions.

Prudential Corporation Asia's distribution is predominantly through its 138,000 tied agents but also through other distribution channels such as banc assurance agreements (including Standard Chartered Bank in Hong Kong, Malaysia, Singapore, Taiwan and Thailand). ICICI Pru offers a complete range of insurance products.

1. 2. 3. 4. 5. 6.

Protection Plans Savings Plans Child Plans Retirement Plans Group Plans Plans for NRIs Protection Plans a. Life guard b. Invest shield life c. Invest shield cash d. Invest shield gold e. Premier life f. Life Time & Life Time II g. Cash Back

Child Plans
a. Smart Kid regular premium b. Smart Kid unit-linked regular premium c. Smart Kid unit-linked regular premium II d. Smart Kid unit-linked single premium II

Retirement Plans
a. Golden Years b. InvestShield Pension c. Life Time Pension II d. Life Link Pension II

TATA AIG
Tata AIG Life Insurance Company Ltd. and Tata AIG General Insurance Company Ltd. (collectively "Tata AIG") are joint venture companies, formed from the Tata Group and American International Group, Inc. (AIG). Tata AIG combines the strength and integrity of the Tata Group with AIG's international expertise and financial strength. The Tata Group holds 74 per cent stake in the two insurance ventures while AIG holds the balance 26 per cent stake. Tata AIG Life Insurance Company Ltd. provides insurance solutions to individuals and corporates. Tata AIG Life Insurance Company was licensed to operate in India on February 12, 2001 and started operations on April 1, 2001. Tata AIG Life offers a broad array of life insurance coverage to both individuals and groups, with various types of add-ons and options available on basic life products to give consumers flexibility and choice. The non-life insurance arm, Tata AIG General Insurance Company, which started its operations in India on January 22, 2001 offers the complete range of insurance for automobile, home, personal accident, travel, energy, marine, property and casualty, as well as several specialized financial lines. THE TATA GROUP The Tata Group is India's best-known industrial group with an estimated turnover of around US $ 14.25 billion (equivalent to 2.6 % of India's GDP). Known for its adherence to business ethics, it is India's most respected private business group. With more than 220,000 employees across 91 major companies, it is also India's largest employer in the private sector.

THE AIG GROUP

American International Group, Inc. (AIG) is the world's leading international insurance and financial services organization, with operations in approximately 130 countries and jurisdictions. AIG's growing global consumer finance business is led in the United States by American General Finance. AIG also has one of the largest U.S. retirement savings businesses through AIG Sun America and AIG VALIC, and is a leader in asset management for the individual and institutional markets, with specialized investment management capabilities in equities, fixed income, alternative investments and real estate. AIG's common stock is listed in the New York Stock Exchange, as well as the stock exchanges in London, Paris, Switzerland and Tokyo.

Products:
1. 2. 3. CHILDREN PLANS ADULT PLANS RETIREMENT PLANS

CHILDREN PLANS
a. ASSURE EDUCARE b. ASSURE CAREER BUILDER c. MAHALIFE GOLD d. ASSURE 21YEARS MONEY SAVER

ADULT PLANS
a. TATA AIG INVEST ASSURE b. ASSURE LIFELINE c. LIFEPLUS d. TATA AIG HEALTH FIRST e. MAHALIFE GOLD

RETIREMENT PLANS

a. ASSURE GOLDEN YEARS b. MAHALIFE GOLD c. NIRVANA

BIRLA SUN LIFE INSURANCE

Birla Sun Life Insurance is the coming together of the Aditya Birla group and Sun Life Financial of Canada to enter the Indian insurance sector. The Aditya Birla Group, a multinational conglomerate has over 75 business units in India and overseas with operations in Canada, USA, UK, Thailand, Indonesia, Philippines, Malaysia and Egypt to name a few. Birla Sun Life Insurance Company Limited is a joint venture between The Aditya Birla Group, one of the largest business houses in India and Sun Life Financial Inc., a leading international financial services organization. The local knowledge of the Aditya Birla Group, coupled with the expertise of Sun Life Financial Inc., offers a formidable for your future. Birla Sun Life Insurance, in just over 4 years of its launch, has catapulted itself to, and cemented its position as a leading player in the private life insurance industry with an annualized new business premium of Rs.627.4 crores. The company has a presence in 40 cities through 55 branches and in over 200 towns & cities through its Corporate Agents and Bank partners. The company has a capital base of Rs. 370 crores currently.

Aditya Birla Group

The Aditya Birla Group is India's first truly multinational corporation. Global in vision, rooted in Indian values, the Group is driven by a performance ethic pegged on value creation for its multiple stakeholders. A US$ 7.59 billion conglomerate, with a market capitalization of US$ 7 billion, it is anchored by an extraordinary force of 72,000 employees belonging to over 20 different nationalities. Over 30 per cent of its revenues flow from its operations across the world. The Group's products and services offer distinctive customer solutions. Its 66 state-of-the-art manufacturing units and sectoral

services span India, Thailand, Indonesia, Malaysia, Philippines, Egypt, Canada, Australia and China.

Sun Life Financial

Sun Life Financial is a leading international financial services organization. With a history that dates back to 1871, Sun Life Financial has evolved from a single mutual life insurance to one of the most highly rated insurance and wealth management institutions in the world. Sun Life Financial knows its value lies in more than assets and history. It also lies in the culture of integrity and the pursuit of excellence that have marked all of the organizations endeavors. Today, the Sun Life Financial Group of companies and partners are represented globally in Canada, the United States, the Philippines, Japan, Indonesia, India and Bermuda.

Excellence
Sun Life Assurance Company of Canada, Sun Life Financial's primary insurance business, has excellent ratings with the world's top rating agencies. With assets under management as on September 30, 2000 totaling more than CDN$345 billion, it ranks amongst the largest international financial services organizations in the world. Sun Life Financial enjoys independent ratings that place us at the top of the financial sector in North America.

Products:
1. 2. 3. 4. 5. PRIME LIFE LIFE COMPANION FLEXI LIFE LINE PLAN FLEXI CASH FLOW MONEY BACK PLAN FLEXI SAVE PLUS ENDOWMENT PLAN

6.

FLEXI SECURELIFE RETIREMENT PLAN

z n i l A j a B l a i t n e d u r P C I

MARKET SHARE OF HDFC STANDARD LIFE INSURANCE WITH PRIVATE PLAYERS IF INSURANCE INDUSTERY

e f i L r d n a t S C F D H e f i L I B S e f L n u S a l r i B G I A t a T k r o Y w e N x a M a i v A

l u D L O r d n i h M k a t o K a s y V G N I f L c n a i l e R f i L t e M e f i L r h a S e f L m a i r h S

10

11

12

13

14

FINANCIAL ANALYSIS OF HDFC STANDARD LIFE INSURANCE BALANCE SHEET AS AT 31st MARCH 2012

2.1.4 PROBLEMS OF HDFCSL IC

Since HDFC SLIC is a private player in the insurance industry, it has not yet reached break-even. Hence, it has high cost due to which its premiums are high as compared to LIC. It has to create credibility in the public.

It has to compete with the wide range of products that its competitors offer. It has to focus towards rural segment also which has a great scope of growth. It has to decide on the strategies to be adopted which will help to counter competition.

It has to increase its no. of branches and also enhance its network of agents so that it can compete with LIC.

It has to focus on providing effective training to its agents so that the customer base can be increased and moreover customer satisfaction can be ensured.

CHAPTER 3: OBJECTIVES & METHODOLOGY

3.1 3.2 3.3 3.4

MANAGERIAL USEFULNESS OBJECTIVES OF THE STUDY SCOPE OF THE STUDY RESEARCH METHODOLOGY USED

3.1

MANAGERIAL USEFELNESS OF THE STUDY

A thorough research and a detailed study of the market is very important for the management to take the right strategy suiting the market condition. The study gives the information regarding the market competition, innovative products offered by competitors, present demand of the products in the market etc.

The main usefulness of the study on the managerial level is:

Market survey will help to know the prevailing market condition and also help in framing the policies accordingly. The study will help the management to understand the customer mindset and also estimating the present and future market demand for the products. It will help to estimate the level of awareness established in the market and in deciding the extent of promotion required. It will help in finding out the customers expectations about the product and also help to know the customer physiology. It will help to know the class on which HDFC SLIC must concentrate.

3.2

OBJECTIVES OF THE STUDY

To find the preferences of products and companies among the wide range available in the insurance industry.

To study the range of product offerings of the different insurance players. To study the level of awareness about HDFC SLICs products.

SUB-OBJECTIVE:

To conduct market research about how people perceive HDFC SLIC as a brand and what are their expectations from the current insurance industry.

3.3

SCOPE OF THE STUDY

The study helped in assessing the customers attitude towards HDFC SLIC. The findings can be generalized from regional level. The product offerings of different companies in insurance industry to create awareness and to increase market share were studied. The awareness of endowment policies in particular was also studied. This provided scope for understanding the consumer preferences and retaining present customers while adding new ones. The study helped to understand the customer expectations, the potential customers requirement and customers problems and has helped to keep customers highly satisfied.

3.4

RESEARCH METHODOLOGY USED

After specifying the objective of research it becomes essential to make an efficient plan for gathering the needed information.

Market research involves the following steps:

Step 1: Define the problem and research objectives. Step 2: Developing the research plan Selection method Questionnaire method Sampling method Contact method

Step 3: Collect the information Step 4: Analyze the information. Step 5: Present the findings.

Step 1: Define the research objective After discussing with the external project guide the topic for the project was selected as : Product analysis of HDFC SLIC and its different competitors in insurance industry Step 2: Developing the research plan Questionnaire method

Marketing researchers have the best instrument in collecting primary data i.e. a questionnaire to collect the data and to establish the view of the people from all the sectors of the society. Questionnaires are designed to elicit information that meets the studies requirements. Questions should be:
o o o

clear easy to understand directed towards meeting an objective.

Need to define objectives before designing the questionnaire. Must maintain impartiality and be very careful with personal data. Four basic types of questions are:
o o o o

Open ended Dichotomous Multiple choice. Scaled (lickert)

The questionnaire designed for this project contains open-ended questions. All the questions are clearly defined. The questions are framed keeping in mind the objective of research and kind of information required .Sampling method To select representative units from a total population. A population "universe", all elements, units or individuals that are of interest to researchers for a specific study. IE all registered voters for an election. Sampling procedures are used in studying the likelihood of events based on assumptions about the future.
o o

Random sampling, equal chance for each member of the population Stratified sampling, population divided into groups re: a common characteristic, random sample each group

o o

Area sampling, as above using areas Quota sampling, judgmental, sampling error cannot be measured statistically, mainly used in exploratory studies to develop a hypotheses, non-probablistic.

Random sampling is selected as the sampling method for this project. Selection Method o Mail-wide area, limited funds, need incentive to return the questionnaire Mail panels, consumer purchase diaries. Must include a cover letter to explain survey!! o Telephone-speed, immediate reaction is negative, WATS, computer assisted telephone interviewing. o Personal interviews flexibility, increased information, non-response can be explored. Most favored method among those surveyed. Can be conducted in shopping malls. o In home (door-to-door) interview, get more information but it is costly and getting harder to accomplish.

o Mall intercepts-interview a % of people passing a certain point. Almost half of major consumer goods and services orgs. use this technique as a major expenditure. Can use demonstration, gauge visual reactions. Regarding social behavior, mall surveys get a more honest response than telephone surveys. There is a bias toward those that spend a lot of time in malls. Need to weight for this. On site computer interviewing, respondents complete self administered questionnaires conducted in shopping malls. Questions can be adaptive depending on the responses. o Focus groups-observe group interaction when members are exposed to an idea or concept, informal, less structured. Consumer attitudes, behaviors, lifestyles, needs and desires can be explored in a flexible and creative manner. Questions are open ended. Cadillac used this method to determine that they should be promoting safety features. A sample of 200 people was taken and judgement was done to select the right prospects to secure accurate information. The sample consisted of people like businessman, doctors, pvt. Company employees. Contact/Observation method

Record overt behavior, note physical conditions and events. Can be combined with interviews, i.e. get demographic variables. Mechanical observation devices, IE cameras, eye movement recorders, scanner technology, Nielsen techniques for media. Observation avoids the central problem of survey methods, motivating respondents to state their true feelings or opinions. If this is the only method, then there is no data indicating the causal relationships.

Step 3: Collection of information The information of the project was gathered in 2 forms: Primary data In primary data collection, you collect the data yourself using methods such as interviews and questionnaires. The key point here is that the data you collect is unique to you and your research and, until you publish, no one else has access to it. There are many methods of collecting primary data and the main methods include:

questionnaires interviews focus group interviews observation case-studies diaries critical incidents portfolios. Secondary data

Secondary data - collected by others to be "re-used" by the researcher

What Form Does Secondary Data Take? Qualitative Sources Sources for Qualitative Research:

Biographies - subjective interpretation involved Diaries - more spontaneous, less distorted by memory lapses

Memoirs - benefit/problem of hindsight Letters - reveal interactions Newspapers - public interest & opinion

Novels & Literature In General Handbooks, Policy Statements, Planning

Documents, Reports, Historical & Official Documents (Hansard, Royal Commission reports)
o

Quantitative Sources

Published Statistics:

National Government Sources Local Government Sources Other Sources

Non-Published / Electronic Sources

Data Archives eg: the Data Archive At Essex On-Line Access To National Computing Centres International Sources on Internet & Web

For this project the secondary sources used are: Journals Company product brouchers Internet

Step 4: Data Analysis The analysis was conducted by editing and coding the data. Coding was done in the form of tabulation and editing was done by reviewing the questions.

Step 5: Present the findings The findings of the project are the presented along with the recommendations. Market Research Design Research Data Source Research approach Research instrument Type of questions Sample sizes Mode of collecting data collection : : : : : : : Descriptive type Primary & secondary Survey method Questionnaire Closed ended 200 samples Respondents to be chosen randomly.

CHAPTER 5: DATA ANALYSIS

Q.1

WHAT IS YOUR PROFESSION ?

Ref no. 2 17%

Fig out of 200 14%

32%

37%

Doctor Pvt. Emp Self employed Others

This question was asked to see the class of people who purchase insurance policies the most and the least.

ANALYSIS: 37% of the policy holders are employed in pvt. sector and 32% are self employed. Only 17% of policy holders are employed in govt. sector

Q2.

WHAT AGE GROUP YOU FALL INTO ?

Ref no.3 5% 29%

fig.out of 200

24% 18-25 yrs 25-40yrs 40-55yrs above 55yrs 42%

This question was asked to determine that people of which age group are insurance policy holders and which age group the co. must target on i.e the potential group.

ANALYSIS: HDFC s insurance products are devised for customers of age group 18-25 and 25-40 yrs. But only 24% of customers are of group 18-25 yrs

Q3.

WHICH INCOME GROUP YOU FALL INTO ?

Ref no.4

fig out of 200

14%

24% < 2 lacs 2-2.5 lacs 2.5-3.5 lacs > 3.5 lacs 35%

27%

This question was asked to determine the income bracket class which is more responsive to insurance policies.

ANALYSIS: 35% of the sample population belongs to the income bracket of 2-2.5 lacs and 27% belong to 2.5-3.5 lacs. Therefore products suitable to this class of customers must be developed.

Q4.

DO YOU KNOW ABOUT IRDA ?

Ref no.5

fig out of 200

83
Yes No

117

This question was asked to determine the prevailing level of awareness of IRDA.

ANALYSIS:
35% of the sample population belongs to the income bracket of 2-2.5 lacs and 27% belong to 2.5-3.5 lacs. Therefore products suitable to this class of customers must be developed

Q.5. DO YOU HAVE INSURANCE POLICIES?

Ref no.6

fig out of 200

63
Yes No

137

This question was asked to determine the potential customers and present customers.

ANALYSIS: 68.5% of the population has insurance covers. This means there is still a greater market that has to tapped

Q.6. WHICH INSURANCE COMPANIES ARE YOU AWARE OF THAT ARE TRUSTED BODIES ?

Ref no.7

169 180 160 140 123 120 83 100 80 60 40 20 0

SL RU K IP TA DF C KO IC H Z IC O M LL IA N

78

68

79 41 27
VY AS A G

19
LI FE

JA J

RK

N LA SU

BA

YO

VI VA

EW

IR

This question was asked to determine the competitor of HDFC SLIC in terms of creating greater reliability in the minds of customers.

ANALYSIS: ICICI Prudential is considered to be the most reliable organization in the minds of sample population followed by HDFC SLIC and then Om Kotak. Therefore HDFC SLIC has to increase the level of reliability to beat its strongest competitor

Q.7. WHICH OF THE FOLLOWING YOU PREFER ?

M A

IN

M ET

Ref no.8

fig out of 200

79

121

Single premium

Regular premium

This question was asked to determine the type of policy that is most preferred in terms of payment period.

ANALYSIS: 39.5% of population prefers single premium covers. Therefore more of regular premium products have to be produced

Q.8. WHAT IS YOUR OBJECTIVE OF INSURANCE ?

Ref no.9

fig out of 200

26

13

22 32

47 24

36

Protection Savings Investment Pension Taxation Education Others

This question was asked to determine the driving factor of purchasing insurance covers so that the product that has the greatest potential can be found out and offered.

ANALYSIS: 47% of the population purchases insurance products to get tax benefits.32% to incur savings.26% for educational purposes.36% for investment motives and 24% for pension.

Q.9. FOR WHAT TERM DO YOU GENERALLY INVEST ?

Ref no.10 17

fig out of 200

74

109

<=10yrs 10-15yrs >15yrs

This question was asked to determine the most preferred term of investment while going for insurance covers.

ANALYSIS: 54.5% of the population prefers to invest for a term of less than 10years and 37% of them prefer to invest for a term of 10-15 years.

Q.10. DO YOU HAVE ANY UNIT LINKED PLANS ?

Ref no.11

fig out of 200

77
Yes No

123

This question was asked to determine the present and potential market for ULIP HDFC SLICs premier product.

ANALYSIS: Only 38.5% of the population has taken Unit linked plans. This implies there is a large market that is available for this product

Q.11. WHAT TYPE OF UNIT LINKED PLANS DO YOU INVEST IN?

Ref no.12

fig out of 200

49 86

65

ChildrenPlan

Endowment Plan

Pension Plan

This question was asked to determine the type of ULIP that is most preferred and the one which needs greater attention by the company..

ANALYSIS:

43% of the population purchase children plans, 32.5% purchase endowment and 24.5% purchase pension plans.

Q..12 WHAT

BENEFITS

YOU

LOOK.

FOR

BEFORE

PURCHASING INSURANCE PRODUCTS?

Ref no.13 fig. out of 200

89

73

38
Withdrawal facility Switching funds Inc/Dec of premiums

This question was asked to determine the benefit that is most seeked by the customers at the time of choosing the insurance products.

ANALYSIS: 36.5% of the population seek for withdrawal facility and 45% seek for premium flexibility on choosing for insurance products

Q.13. HOW MANY INSURANCE COVERS HAVE YOU TAKEN ?

Ref no.14 fig. out of 200

44 86

70

One

Two

Three or more

This question was asked to determine the volume of purchase per customer.

ANALYSIS: 43% of the population has only one insurance cover, 35% have two covers and only 22% have three or more covers

Q14.

WHAT

FACTORS

YOU

CONSIDER

BEFORE HOW

PURCHASING INSURANCE POLICIES AND WOULD YOU RATE THEM ON A SCALE OF 1-5?

1. Company Name

Ref no.15

Ratings for Company name

37

18 26

70

49

Score:1

Score: 2

Score:3

Score:4

Score:5

ANALYSIS: HDFC SLIC has to focus on lower charges and providing greater benefits to create a greater customer base.

2. Charges

Ref no.16

Rating for charges

47

12 46

58

37

Score:1

Score:2

Score:3

Score:4

Score:5

3.Benefits

Ref no.17

Ratings for benefits

25 47

21 39

68

Score:1

Score:2

Score:3

Score:4

Score:5

4. Growth
Ref no.18 Ratings for Growth

9 83

25

34 49

Score:1

Score:2

Score:3

Score:4

Score:5

Ref no.19 1000 800 600 400 200 0 Co. Name

Ratings for all factors

820 682 682

772

Charges

Benefits

Growth

Ratings of HDFC SLIC on all factors

Q15.

HOW WOULD RATE HDFCSLIC ON THE FOLLOWING FACTORS ? (TICK)

1. HDFC SLIC
Ref no.20 Ratings of HDFC SLIC

100 80 60 40 20 0
Score:1 Score:2 Creating Awareness Score:3 Accesibility Score:4 Quality of Service

Product Variety

2 ICICI PRUDENTIAL
Ref no.21 120 100 80 60 40 20 0 Score:1 Score:2 Creating Awareness Score:3 Accesibility Score:4 Quality of Service Ratings for ICICI PRUDENTIAL

Product Variety

3. TATA AIG
Ref no.21 Ratings for TATA AIG

100 80 60 40 20 0
Score:1 Score:2 Creating Awareness Score:3 Accesibility Score:4 Quality of Service

Product Variety

4.BIRLASUNLIFE

Ref no.22

Ratings for BIRLA SUN LIFE

100 80 60 40 20 0
Score:1 Score:2 Creating Awareness Score:3 Accesibility Score:4 Quality of Service

Product Variety

ICICI Prudential is the biggest competitor of HDFC SLIC in terms of product variety, creating awareness, accessibility, quality of service.

CHAPTER 6: FINDINGS AND RECOMMENDATIONS

6.1 Findings 6.2 Recommendations

6.1 FINDINGS
a.) From secondary sources

Market share of various insurance organizations in Apr-Jun12 Name of organization LIC ICICI PRUDENTIAL BAJAJ ALLIANZ HDFC SLIC TATA AIG BIRLA SUN LIFE SBI LIFE MAX NEW YORK Market share 74.87% 7.53% 4.18% 3.2% 1.93% 1.84% 1.69% 1.44%

6.2 RECOMMENDATIONS
The co. should focus on producing greater product variety and more customization.

Greater awareness about IRDA and the organization has to be created through advertisements.

Investment as an objective of insurance has yet to be established . Greater focus should be paid on this.

ICICI Prudential is the greatest competitor of HDFC SLIC. Therefore the performance of HDFC in terms of product variety, growth rate, accessibility and greater awareness should be monitored and enhanced.

The potential target customer id of the age group 18-25 years and income bracket 2-3.5 lacs. Customized products for this class should be devised and offered.

CHAPTER 7: LIMITATIONS

7.1 LIMITATIONS

LIMITATIONS
1. The time for which the research was conducted was just two months. Hence the sample size was restricted to 200 only. 2. The scope of study was also restricted to the study of awareness about the HDFC SLIC policies and consumer preferences. It could be widened to cover various others aspects of insurance product demand. 3. As there are many competitors of HDFC SLIC in the pvt. Insurance sector. Only 3 of its competitors products were analyzed in detail. A detailed study of all the competitors of HDFC SLIC would have given more reliable and accurate results. 4. The area from where the sample population was selected was Delhi only. Other cities and moreover rural area was not covered under the study. 5. The primary data was collected form present and potential customers of insurance products to evaluate their preferences. But the preferences of financial agents was not considered which would have helped to evaluate the preferable commission sale which helps to boost product sale.

ANNEXURES

QUESTIONAIRE PERSONAL DETAILS

NAME ADDRESS SEX TEL NO EMAIL : :

: : : M

_____________________________________ _______________________________________ F

_________________________________________ _________________________________________

Q1.

WHAT IS YOUR PROFESSION ? PVT. EMPLOYEE BUSINESSMAN DOCTOR

Q2.

WHAT AGE GROUP YOU FALL INTO ? 18-25 25-35 35-50 ABOVE 50

Q3.

WHICH INCOME GROUP YOU FALL INTO ? > 2 Lac 2 2.5 Lac 2.5 3.5 Lac >3.5 Lac

Q4.

DO YOU KNOW ABOUT IRDA ? YES NO

Q5.

DO YOU HAVE INSURANCE POLICIES ? YES NO

Q6.

WHICH INSURANCE COMPANIES ARE YOU AWARE OF THAT ARE TRUSTED BODIES ? HDFC STANDARD LIFEALLIANZ BAJAJ ICICI PRUDENTIAL OM KOTAK AVIVA ING VYASA MET LIFE

M MAX NEW YORK 0 BIRLA SUN LIFE

Q7.

WHICH OF THE FOLLOWING YOU PREFER ? SINGLE PREMIUM POLICIES REGULAR PREMIUM POLICIES

Q8.

WHAT IS YOUR OBJECTIVE OF INSURANCE ? PROTECTION TAXATION SAVINGS INVESTMENT EDUCATION PENSION OTHERS

Q9.

FOR WHAT TERM DO YOU GENERALLY INVEST ? LESS THAN 10 YRS 10-15 YRS MORE THAN 15 YRS

Q10.

ARE YOU AWARE OF UNIT LINKED PLANS ? YES NO

Q11.

WHAT TYPE OF UNIT LINKED PLANS DO YOU INVEST IN ? CHILDRENS PLAN ENDOWMENT PENSION

Q12.

WHAT

BENEFITS

YOU

LOOK

FOR

BEFORE

PURCHASING

INSURANCE POLICIES/PLANS ? WITHDRAWALS SWITHCHING FUNDS

INC/ DEC OF PREMIUMS Q13. HOW MANY INSURANCE COVERS HAVE YOU TAKEN ? ONE Q14. TWO THREE OR MORE

WHAT FACTORS YOU CONSIDER BEFORE PURCHASING INSURANCE POLICIES AND HOW WOULD YOU RATE THEM ON A SCALE OF 1-5? COMPANY NAME CHARGES MATURITY AMT BENEFITS ____________ ____________ ____________ ____________

Q15.

HOW WOULD RATE HDFCSLIC ON THE FOLLOWING FACTORS ? (TICK)

EXCELLENT PRODUCT VARIETY CREATING AWARENESS ACCESIBILITY

QUALITY OF SERVICE

VERY GOOD

GOOD

AVERAGE

BIBILIOGRAPHY

1.

Marketing Management Philips Kotler

2. 3. 4.

Service Marketing - Zeithal Case Folio Insurance marketing C R Kothari, Research Methodology

Websites: www.lic.com www.hdfcsl.com www.icicipru.com www.tataaig.com