A PROJECT REPORT on

Consumer Awareness And Perception About The Product Of Reliance Money

IN PARTIAL FULFILLMENT IN AWARD OF PGDBM TWO YEARS FULL TIME PROGRAMME

UNDER GUIDANCE OF FACULTY GUIDE Ms. VINITA AGARWAL SUBMITTED BY COMPANY GUIDE Mr. K.V.SINGH

CHANDRESH BHARISHM
PGDBM II SEMESTER

2007-2008

Maharishi Arvind Institute of Science & Management

Ambabari Circle, Bharti Path, Ambabari, Jaipur-302 023 INDIA. Tel: +91-141-2335487, 2234216 Telefax: +91-141-2335120 E-mail: maism@datainfosys.net ; maism@maism.com

CERTIFICATE FROM THE FACULTY GUIDE

This is to certify that the Summer Training Report entitled is Consumer Awareness And Perception About The Product Of Reliance Money a bonafide work carried out by Mr. CHANDRESH BHARISHM in partial fulfillment in award of 'Post Graduate Diploma in Business Management (PGDBM)' course approved by All India Council for Technical Education (AICTE), Ministry of HRD, Government of India, New Delhi. To the best of my knowledge and belief, this work is not submitted/ published elsewhere for any degree or diploma examination.

(Ms. VINITA AGARWAL) Maharshi Arvind Institute of Science & Management Date: Place: Jaipur

ACKOWLEDGEMENT
My sincere thanks to our faculty guide Ms. Vinita Aggarwal for giving me this opportunity to research on the company of my choice and for the constant support and guidance which he provided to me throughout this project would not have been successful. I further wish to inform that this project has been beneficial in applying theoretical knowledge to the real world scenario in business terms. Though a lot of hard work has gone into the marking of this project. It would not have been possible without the assistance of few people. I would like to extend my sincere gratitude towards Reliance Mutual Funds. Special thanks to Mr. K.V.Singh (Company guide Reliance money Jaipur),I extend my grateful thanks to staff members of Reliance money for allowing me to pursue my work in this re-owned organisation. Maharishi Arvind institute of science and management, Jaipur for her magnanimous support in fulfilling my summer training with ease and support. Thanks and Regards.

Chandresh Bharishm PGDBM - II Semester Maharshi Arvind Institute of Science & Management

INDEX 1. Executive Summary. 2. Introduction of the insurance sector 8 3. Anil Dhirubhai Ambani Group 20 4. Introduction of the project 28 5. Research Methodology 42 6. Findings from the Study.. 47 7. .. 49 8. . 50 5

Page No

Conclusion Suggestions

9. Limitations of the Study. 51 10. Annexure 1.. 52 11. Annexure 2.. 55 12. 57 Biblography

EXECUTIVE SUMMARY
Indian Insurance Industry provides extensive research and objective analysis of the growing insurance industry, its product quality, and services in India. This report helps to analyze the leading-edge opportunities critical to the success of the insurance Industry in India. Detailed data and analysis helps investors, financial service providers, and global banking players to navigate through the evolving insurance market in India. In the simplest terms, insurance of any type is all about "managing risk." For example, in life insurance, the insurance company attempts to manage mortality (death) rates among their clients. The insurance company collects premiums from policy holders, invests the money (usually in low risk investments), and then reimburses this money once the person passes away or the policy matures. A person called an actuary constantly crunches demographic data to estimate the life of a person. This is why your characteristics such as age/sex/smoker/etc. all affect the premium that you pay. The greater the chance of a person having a shorter life span than the average, the higher the premium that person will have to pay. This process is virtually the same for every other type of insurance, including automobile, health, and property. Key Issues and Facts Analyzed The research report also addresses the issues and facts that are critical to business success: - What are the marketing strategies of the players in the insurance industry?

- What are the opportunities for the players in this industry and what are the challenges to sustain the Insurance market in India? - What will be the prospective areas of investments in the insurance industry in the near future?

Key Products Analyzed Key products like Life and Non-life insurance have been analyzed, supported by facts like revenue and market trends. Key Players This section provides an overview of some of the key players in this industry like Bajaj Allianz, ING Vysya, AMP Sanmar Assurance Limited, SBI Life, Tata AIG Life, HDFC Standard, ICICI Prudential Life Insurance, Birla Sunlife, Aviva Life Insurance, Kotak Mahindra Old Mutual, Max New York Life, Met Life, Sahara Life, LIC, Royal Sundaram, Tata-AIG General, Reliance General, IFFCO-Tokio, ICICI-Lombard, HDFC Chubb, New India Assurance Company Limited, National Insurance Company Limited, United India Insurance Company Limited and Oriental Insurance Limited.

Research Methodology Used

Information Sources Information has been sourced from various sources namely, Books, Newspapers, trade journals, and white papers, industry portals, government agencies, trade associations, monitoring industry news and developments, and through access to access to more than 3000 paid databases.

Key Findings - Taking into account the changing socio-economic demographics, rate of GDP growth, changing consumer behavior and occurrences of natural calamities at regular intervals, the Indian life insurance market is expected to reach the value of around Rs 1683 Billion in the year 2009. The market is expected to grow at a CAGR of more than 200% YOY from the year 2006 - In 2006-07, pension premium contributed about 22.11% to total premium income of insurers. Interestingly, the figure in the first nine months to December 2005 was 25.22%. - In the non-life segment, the established players control 65% of the market. So it is their monthly performance that determines how the market as a whole would perform. - In Motor Insurance Business, Public sector covers almost 68% of the market value whereas the private sector just had 32% market share till September 2006.

INTRODUCTION TO THE INSURANCE SECTOR

What is Insurance?
An insurance contract provides risk coverage to the insuree. A purchaser of insurance pays a fixed premium in exchange for a promise of compensation in the event of some specified loss. Insurance is bought because it gives peace of mind to the holders. This comfort level is important in personal and business life. Though the primary purpose of insurance is to provide risk coverage, when the contract period extends over a long time, as in the case of life insurance, premium payments comprise of two components one for buying risk coverage and the other towards savings. This bundling together of risk coverage and savings is peculiar to life insurance and is more common in developing countries like India. In the industrially advanced countries, this is not necessarily so and short duration life insurance contracts without a savings component are equally popular. In the developing economies because of the savings component and

the long nature of the contract, life insurance has become an important instrument of mobilising long-term funds. The savings component puts the life insurance in direct competition with other financial institutions and savings instruments.

The total investment portfolio of the insurers in India as at the end of March, 2005 was Rs. 4,65,864 crore. The total premium collected by the insurers both life and non-life in 2004-05 was Rs.1,00,335 crore. The major contribution came from life insurance. The insurance penetration i.e., premia as percentage of GDP was 3.17 per cent in 2004. While this ratio is steadily increasing, it is far below the world average of 8.06 per cent. This shows the vast potential that exists.

Insurance and Growth Insurance and economic growth mutually influence each other. As the economy grows, the living standards of people increase. As a consequence, the demand for life insurance increases. As the assets of people and of business enterprises increase in the growth process, the demand for general insurance also increases. In fact, as the economy widens the demand for new types of insurance products emerges. Insurance is no longer confined to product markets; they also cover service industries. It is equally true that growth itself is facilitated by insurance. A well-developed insurance sector promotes economic growth by encouraging risk-taking. Risk is inherent in all economic activities. Without some kind of cover against risk, some of these activities will not be carried out at all. Also insurance and more particularly life insurance is a mobilizer of long term savings and life insurance companies are thus able to support infrastructure projects which require long term funds. There is thus a mutually beneficial interaction between insurance and economic growth. The low income levels of the vast majority of population has been one of the factors inhibiting a faster growth of insurance in India. To some extent this is also compounded by certain attitudes to life. The economy has moved on to a higher growth path. The average rate of growth of the economy in the last three years was 8.1 per cent. This strong growth will bring about significant changes in the insurance industry.

At this point, it is important to note that not all activities can be insured. If that were possible, it would completely negate entrepreneurship. Professor Frank Knight in his celebrated book Risk Uncertainty and Profit emphasised that profit is a consequence of uncertainty. He made a distinction between quantifiable risk and nonquantifiable risk. According to him, it is non-quantifiable risk that leads to profit. He wrote It is a world of change in which we live, and a world of uncertainty. We live only by knowing something about the future; while the problems of life, or of conduct at least, arise from the fact that we know so little. This is as true of business as of other spheres of activity. The real management challenges are uninsurable risks. In the case of insurable risks, risk is avoided at a cost.

Assessment of Risks An important function of an insurer is to assess the average level of risk borne while offering a product. This assessment depends upon a variety of factors and actuarial calculations become necessary. This is a highly technical area involving theories of probability. The premium charged by an insurer is based on the calculated average risk. Obviously this premium will be high for people who perceive themselves to be in a low risk category. However, for insurance as an activity to succeed, the population to which a product is offered must consist of categories with different degrees of risk. That is why the larger the coverage, the lower the average risk and lower the premium. Diversification is the way to reduce the average risk. Regulatory Framework As in the case of all financial institutions, insurance is an activity that needs to be regulated. This is so because the smooth functioning of business depends on the trust and confidence reposed by the customers in the solvency of the financial institutions. Insurance products are of little value to customers, if they cannot trust the company to keep its promise. The regulatory framework in relation to the insurance companies seeks to take care of three major concerns (a) protection of consumers interest, (b) to ensure the financial soundness of the insurance industry, and (c) to help the healthy growth of the insurance market. So long as insurance remained the monopoly of the Government, 10

the need for an independent regulatory authority was not felt. However, with the acceptance of the idea that there can be private insurance entities, the need for a regulatory authority becomes paramount. With the passing of the Insurance Development and Regulatory Act in 2000, the insurance regulatory authority has become a statutory authority. Protecting consumer interest involves proper disclosure, keeping prices affordable, some mandatory products and standardization. Most importantly, it has to make sure that consumers get paid by insurers. From the consumers point of view, the most important function of the regulatory authority will be to ensure quick settlement of claims without unnecessary litigation. With respect to solvency and financial health, regulations will have to be introduced to ensure that insurance companies follow appropriate prudential norms such as solvency margins. Large funds are under the custody of the insurers and they get invested to produce additional returns. The management of these funds is important to the insurer, the insured and the economy. Entry into the insurance industry must also be regulated with suitable capital adequacy norms. The third role should be one of development. The insurance industry in India has a large potential and the framework of regulation must enable the industry to tap this vast potential. IRDA over the last decade has brought into force a number of regulations which are well conceived. They have received wide spread appreciation. The recent decision of IRDA to move to a free tariff regime for several general insurance products is welcome. The prescription of tariff is contrary to market principles and insurance products need to be priced based on market forces. The reform of the insurance sector is part of the overall economic reform process that is underway. The basic philosophy underlying the new economic policy is to improve the productivity and efficiency of the system. This is sought to be achieved partly by creating a more competitive environment. The growth of the real economy depends upon the efficiency of the financial sector. A greater element of competition is being injected into the financial system as well. All regulators need to keep in mind that there is a fine distinction between regulations and controls. Regulations lay down norms while controls have a propensity to micromanage institutions. Regulators must take care to ensure that regulations do not slide into controls. The insurance industry in our country underwent a big change in 2000 when private participants were allowed into the industry along with a streamlined regulatory and supervisory regime. There are at present 14 private life insurance companies along with LIC and 12 entities in non-life sector. There is evidence to show that competition 11

has done good to insurance industry. The rate of growth of the industry in the post liberalization period has been faster. It has also developed in terms of product innovation and the use of alternative distribution channels.

Types of Life Insurance

Term Insurance Policy Whole Life Policy Endowment Policy Money Back Policy Annuities And Pension

Most of the products offered by Indian life insurers are developed and structured around these "basic" policies and are usually an extension or a combination of these policies. So, what are these policies and how do they differ from each other? Term Insurance Policy

A term insurance policy is a pure risk cover for a specified period of time. What this means is that the sum assured is payable only if the policyholder dies within the policy term. For instance, if a person buys Rs 2 lakh policy for 15-years, his family is entitled to the money if he dies within that 15-year period. What if he survives the 15-year period? Well, then he is not entitled to any payment; the insurance company keeps the entire premium paid during the 15year period.

So, there is no element of savings or investment in such a policy. It is a 100 per cent risk cover. It simply means that a person pays a certain premium to protect his family against his sudden death. He forfeits the amount if he outlives the period of the policy. This explains why the Term Insurance Policy comes at the lowest cost. Whole Life Policy

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As the name suggests, a Whole Life Policy is an insurance cover against death, irrespective of when it happens. Under this plan, the policyholder pays regular premiums until his death, following which the money is handed over to his family.

This policy, however, fails to address the additional needs of the insured during his postretirement years. It doesn't take into account a person's increasing needs either. While the insured buys the policy at a young age, his requirements increase over time. By the time he dies, the value of the sum assured is too low to meet his family's needs. As a result of these drawbacks, insurance firms now offer either a modified Whole Life Policy or combine in with another type of policy.

Endowment Policy risk cover with financial savings, endowment policies is the most popular policies in the world of life insurance.

In an Endowment Policy, the sum assured is payable even if the insured survives the policy term. If the insured dies during the tenure of the policy, the insurance firm has to pay the sum assured just as any other pure risk cover. A pure endowment policy is also a form of financial saving, whereby if the person covered remains alive beyond the tenure of the policy, he gets back the sum assured with some other investment benefits.

In addition to the basic policy, insurers offer various benefits such as double endowment and marriage/ education endowment plans. The cost of such a policy is slightly higher but worth its value.

Money Back Policy These policies are structured to provide sums required as anticipated expenses (marriage, education, etc) over a stipulated period of time. With inflation becoming a big issue, companies have realized that sometimes the money value of the policy is eroded. That is why with-profit policies are also being introduced to offset some of the losses incurred on account of inflation. A portion of the sum assured is payable at regular intervals. On survival the remainder of the sum assured is payable. In case of death, the full sum assured is payable to the insured.

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The premium is payable for a particular period of time.

ANNUTIES AND PENSION In an annuity, the insurer agrees to pay the insured a stipulated sum of money periodically. The purpose of an annuity is to protect against risk as well as provide money in the form of pension at regular intervals. Over the years, insurers have added various features to basic insurance policies in order to address specific needs of a cross section of people.

Functions Of Insurance
The functions of Insurance can be bifurcated into two parts: 1. Primary Functions 2. Secondary Functions 3. Other Functions The primary functions of insurance include the following:

Provide Protection - The primary function of insurance is to provide protection against

future risk, accidents and uncertainty. Insurance cannot check the happening of the risk, but can certainly provide for the losses of risk. Insurance is actually a protection against economic loss, by sharing the risk with others.

Collective bearing of risk - Insurance is a device to share the financial loss of few
among many others. Insurance is a mean by which few losses are shared among larger number of people. All the insured contribute the premiums towards a fund and out of which the persons exposed to a particular risk is paid.

Assessment of risk - Insurance determines the probable volume of risk by evaluating

various factors that give rise to risk. Risk is the basis for determining the premium rate also

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Provide Certainty - Insurance is a device, which helps to change from uncertainty to

certainty. Insurance is device whereby the uncertain risks may be made more certain

The functions of Insurance can be bifurcated into two parts: 1. Primary Functions 2. Secondary Functions 3. Other Functions The primary functions of insurance include the following:

Provide Protection - The primary function of insurance is to provide protection against

future risk, accidents and uncertainty. Insurance cannot check the happening of the risk, but can certainly provide for the losses of risk. Insurance is actually a protection against economic loss, by sharing the risk with others.

Collective bearing of risk - Insurance is a device to share the financial loss of few
among many others. Insurance is a mean by which few losses are shared among larger number of people. All the insured contribute the premiums towards a fund and out of which the persons exposed to a particular risk is paid.

Assessment of risk - Insurance determines the probable volume of risk by evaluating

various factors that give rise to risk. Risk is the basis for determining the premium rate also

Provide Certainty - Insurance is a device, which helps to change from uncertainty to

certainty. Insurance is device whereby the uncertain risks may be made more certain. The secondary functions of insurance include the following:

Prevention of Losses - Insurance cautions individuals and businessmen to adopt

suitable device to prevent unfortunate consequences of risk by observing safety instructions; installation of automatic sparkler or alarm systems, etc. Prevention of losses cause lesser payment to the assured by the insurer and this will encourage for more savings by way of premium. Reduced rate of premiums stimulate for more business and better protection to the insured.

Small capital to cover larger risks - Insurance relieves the businessmen from
security investments, by paying small amount of premium against larger risks and uncertainty.

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Contributes towards the development of larger industries - Insurance provides

development opportunity to those larger industries having more risks in their setting up. Even the financial institutions may be prepared to give credit to sick industrial units which have insured their assets including plant and machinery. The other functions of insurance include the following:

Means of savings and investment - Insurance serves as savings and investment,

insurance is a compulsory way of savings and it restricts the unnecessary expenses by the insured's For the purpose of availing income-tax exemptions also, people invest in insurance.

Source of earning foreign exchange - Insurance is an international business. The

country can earn foreign exchange by way of issue of marine insurance policies and various other ways.

Risk Free trade - Insurance promotes exports insurance, which makes the foreign trade
risk free with the help of different types of policies under marine insurance cover.

Insurance as Investment
Insurance may not be the best place to invest your hard-earned money. But there are sufficient reasons for one to believe that it can be a highly lucrative avenue to facilitate savings. People often talk about yield on investment and tend to compare their values with those available on various insurance schemes. This is particularly typical within the Indian sub-continent where one conveniently forgets the element of risk covered by life insurance. It is extremely unfair to compare the performance of insurance against other investments without considering the core features of insurance. The very essence of insurance is to protect your family from the uncertainty of your life. Hence it proves very logical to evaluate the costs involved towards this feature. When you pay insurance premium for your car, do you get anything if fortunately no mishap happens? This means that you spent the amount to secure a valuable property. Hence you must accept that out of the total amount paid by you for your life insurance, a certain amount is used for providing the risk cover and only the balance can be utilised as savings. In other words, the total premium you pay minus the amount evaluated as the cost of insurance must be considered as the amount invested to get the maturity amount. If you calculate the yield from returns, you will be in for a surprise. 16

Secondly, we tend to think very unrealistically about our life. We often compare the results after say 10 years from an investment scheme, for instance PPF. And then we try to convince ourselves that PPF is providing a better yield than an insurance policy. For instance, if you invest Rs.10,000/- in PPF after 1 year your money will grow to Rs.11100/- accruing a return of 11 percent. But what if your death occurs in the first year itself? The Rs.10,000/- can give you an insurance cover up to an approximate sum of Rs.12 lakhs (depending upon the plan, age, etc) and this amount shall become available to the nominee of the policyholder as against the mere paltry Rs.11,100/- that PPF shall pay.

LIFE INSURANCE-HISTORICAL PROSPECTIVE

In India, insurance has a deep-rooted history. It finds mention in the writings of Manu ( Manusmrithi ), Yagnavalkya ( Dharmasastra ) and Kautilya ( Arthasastra ). The writings talk in terms of pooling of resources that could be re-distributed in times of calamities such as fire, floods, epidemics and famine. This was probably a pre-cursor to modern day insurance. Ancient Indian history has preserved the earliest traces of insurance in the form of marine trade loans and carriers contracts. Insurance in India has evolved over time heavily drawing from other countries, England in particular. 1818 saw the advent of life insurance business in India with the establishment of the Oriental Life Insurance Company in Calcutta. This Company however failed in 1834. In 1829, the Madras Equitable had begun transacting life insurance business in the Madras Presidency. 1870 saw the enactment of the British Insurance Act and in the last three decades of the nineteenth century, the Bombay Mutual (1871), Oriental (1874) and Empire of India (1897) were started in the Bombay Residency. This era, however, was dominated by foreign insurance offices which did good business in India, namely Albert Life Assurance, Royal Insurance, Liverpool and London Globe Insurance and the Indian offices were up for hard competition from the foreign companies.

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In 1914, the Government of India started publishing returns of Insurance Companies in India. The Indian Life Assurance Companies Act, 1912 was the first statutory measure to regulate life business. In 1928, the Indian Insurance Companies Act was enacted to enable the Government to collect statistical information about both life and non-life business transacted in India by Indian and foreign insurers including provident insurance societies. In 1938, with a view to protecting the interest of the Insurance public, the earlier legislation was consolidated and amended by the Insurance Act, 1938 with comprehensive provisions for effective control over the activities of insurers. The Insurance Amendment Act of 1950 abolished Principal Agencies. However, there were a large number of insurance companies and the level of competition was high. There were also allegations of unfair trade practices. The Government of India, therefore, decided to nationalize insurance business. An Ordinance was issued on 19th January, 1956 nationalising the Life Insurance sector and Life Insurance Corporation came into existence in the same year. The LIC absorbed 154 Indian, 16 non-Indian insurers as also 75 provident societies245 Indian and foreign insurers in all. The LIC had monopoly till the late 90s when the Insurance sector was reopened to the private sector. The history of general insurance dates back to the Industrial Revolution in the west and the consequent growth of sea-faring trade and commerce in the 17th century. It came to India as a legacy of British occupation. General Insurance in India has its roots in the establishment of Triton Insurance Company Ltd., in the year 1850 in Calcutta by the British. In 1907, the Indian Mercantile Insurance Ltd, was set up. This was the first company to transact all classes of general insurance business. 1957 saw the formation of the General Insurance Council, a wing of the Insurance Associaton of India. The General Insurance Council framed a code of conduct for ensuring fair conduct and sound business practices. In 1968, the Insurance Act was amended to regulate investments and set minimum solvency margins. The Tariff Advisory Committee was also set up then. In 1972 with the passing of the General Insurance Business (Nationalisation) Act, general insurance business was nationalized with effect from 1st January, 1973. 107 insurers were amalgamated and grouped into four companies, namely National Insurance Company Ltd., the New India Assurance Company Ltd., the Oriental Insurance Company Ltd and the United India Insurance Company Ltd. The General Insurance Corporation of India was incorporated as a company in 1971 and it commence business on January 1sst 1973. This millennium has seen insurance come a full circle in a journey extending to nearly 200 years. The process of re-opening of the sector had begun in the early 1990s and the last decade and more has seen it been opened up substantially. In 1993, the Government set up a committee under the chairmanship of RN Malhotra, former Governor of RBI, to propose recommendations for reforms in the insurance sector.The objective was to

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complement the reforms initiated in the financial sector. The committee submitted its report in 1994 wherein , among other things, it recommended that the private sector be permitted to enter the insurance industry. They stated that foreign companies be allowed to enter by floating Indian companies, preferably a joint venture with Indian partners. Following the recommendations of the Malhotra Committee report, in 1999, the Insurance Regulatory and Development Authority (IRDA) was constituted as an autonomous body to regulate and develop the insurance industry. The IRDA was incorporated as a statutory body in April, 2000. The key objectives of the IRDA include promotion of competition so as to enhance customer satisfaction through increased consumer choice and lower premiums, while ensuring the financial security of the insurance market.

The IRDA opened up the market in August 2000 with the invitation for application for registrations. Foreign companies were allowed ownership of up to 26%. The Authority has the power to frame regulations under Section 114A of the Insurance Act, 1938 and has from 2000 onwards framed various regulations ranging from registration of companies for carrying on insurance business to protection of policyholders interests. In December, 2000, the subsidiaries of the General Insurance Corporation of India were restructured as independent companies and at the same time GIC was converted into a national re-insurer. Parliament passed a bill de-linking the four subsidiaries from GIC in July, 2002. Today there are 14 general insurance companies including the ECGC and Agriculture Insurance Corporation of India and 14 life insurance companies operating in the country. The insurance sector is a colossal one and is growing at a speedy rate of 15-20%. Together with banking services, insurance services add about 7% to the countrys GDP. A well-developed and evolved insurance sector is a boon for economic development as it provides long- term funds for infrastructure development at the same time strengthening the risk taking ability of the country.

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RELIANCE ANIL DHIRUBHAI AMBANI GROUP

One of the top 3 business groups in India Over a year old group Over 50 million customers by far the largest in India 8 million individual shareholders among the largest in the world Group assets of over US $ 12 billion and Group net worth of over US $ 10 billion Zero net debt at Group level Group market capitalization of over US $ 33 billion; Over US $ 6 billion owned by foreign investors

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 Flagship stocks included in Sensex, Nifty, MSCI and Futures & Options

RELIANCE ADA GROUP

DIVERSIFIED POWER COMMUNICATIONS FINANCAL SERVICES

INFRASTRUCTUR E

NATURAL RESOURCES AND ENERGY

MEDIA & ENTERTAINMENT

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Industry landscape
Need for an efficient & credible pan- India player with integrated approach Dominated by Indian - foreign JVs & government owned bodies Broking & distribution industry catering to retail population fragmented Me-too products, pricing and features Excepting few private banks, no other pan-India player offering entire range of financial services & suite of products

Minimal penetration beyond tier 1 and tier 2 cities Nationalized banks all India reach organizationally not geared to offer full spectrum of financial products & services.

OUR FOUNDER

Dhirubhai Ambani Founder chairmen, Reliance industry ltd India,

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Dec.28,1932 - July 6,2002 Late Dhirubhai Ambani built Reliance from scratch to be in the reckoning for a place in the Global Fortune 500 list. This achievement is even more significant due to the fact, that the entire growth was achieved in an organic manner and in a span of just 25 years. Dhirubhai was not just firmly rooted in traditional Indian values, but was also a quintessentially modern man - the man of the new millennium. This was clearly reflected in his passion for mega-sized projects, the most advanced technology and the highest level of productivity. The corporate philosophy he followed was short simple and succinct - "Think big. Think differently. Think fast. Think ahead. Aim for the best". He inspired the Reliance team to do better than the best - not only in India but also in the world. Dhirubhai Ambani, Founder Chairman of the Reliance Group, had an acute sense that education alone empowers people. He was a great communicator. He communicated to inspire, to guide, to educate and to motivate. It was his vision that Reliance should venture in all spheres of activities and stamp its class in whatever it does, testimony of which is seen today, in the form of its foray in the services sector including Reliance General Insurance Co. Ltd., catering to a wide range of public needs.

Reliance Capital
Reliance Capital Limited (RCL) is a Non-Banking Financial Company (NBFC) registered with the Reserve Bank of India under section 45-IA of the Reserve Bank of India Act, 1934. RCL was incorporated as a public limited company in 1986 and is now listed on the Bombay Stock Exchange and the National Stock Exchange (India) With a net worth of over Rs 3,300 crore and over 165,000 shareholders, RCL has established its presence as a leading player in the financial services sector in the country. RCL ranks among the top 3 companies in the private financial services and banking sector in the country, in terms of net worth. RCL sees immense potential in the rapidly growing financial services sector in India and aims to become a dominant player in this industry and offer fully integrated financial services.

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Board of Directors
Shri Debasis Sengupta
Shri Debasis Sengupta was the Chairman of General Insurance Corporation and prior to this was the CMD of New India Assurance. He has also been a director with the ICICI group.

Shri Satyapal Talwar

Shri Satyapal Talwar was the Chairman & MD in Bank of Baroda and later as Deputy Governor in the Reserve Bank of India. He has held the post of non-executive Chairman in various boards post retirement. An arts and law double graduate, he is also a certified associate of the Indian Institute of Bankers.

Shri Rajendra P. Chitale

Shri Rajendra P Chitale is an eminent Chartered Accountant, is the Managing Partner of M/s M.P.Chitale & Co. He is a Director on the Board of the National Stock Exchange of India (NSC) and other reputed companies. He is also a member of the Advisory Group on Derivatives and the Takeover Panel, Securities and Exchange Board of India as well as the Company Law Advisory Committee of the Government of India.

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Shri Amitabh Chaturvedi

Shri Amitabh Chaturvedi is a Chartered Accountant having more than 17 years of experience in the financial services sector. He has been part of senior management team of Reliance Capital for more than three years. He has been instrumental in accelerating the growth of asset management and has played significant role in setting up all the other businesses of Reliance Capital. He is Vice Chairman of Reliance Capital Asset Management Ltd. He is also on the Board of Directors of Reliance Life Insurance Company Limited and Reliance Money Limited. Prior to joining Reliance group, Amitabh Chaturvedi had more than five year stint with ICICI Bank group. Before leaving ICICI Bank, he served as Head of Retail Liabilities group. He also served as MD & CEO of ICICI Direct.com, the groups online broking Company

Management Team Management Team Chief Executive Officer Chief Financial Officer Underwriting and Risk Management Chief Technology and Operations Officer Human Resources Company Secretary K A Somasekharan Bipin Kabra Mukul Kishore Sriram Naganathan Prashant Utreja Mohan Khandekar

Department Department

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Retail Marketing Agency & Brokers Relations Large Corporates Small and Medium Enterprise Group Claims Products Technical Inspection International Relations

Saugata Chatterjee Manoj S Chauhan Poonam Sandhu Archana Yadav Supratik Biswas Hemalatha Chandrasekhar Anil K Khanna Dilip Sinha

Operations
To achieve business success by improving operational efficiencies, Reliance General Insurance realizes the need to tighten up and streamline both channel partner relationships and back office operations. The brokers and channel partners are the interface to end customers. They play a vital role in helping sustain existing customers as well as attract new customers through better and diverse services. So it is imperative that we are well connected with brokers / channels partners as well as meet their needs. Improvement in back office operations can happen if policy production and billing are automated; overall claims expenses are reduced, and claims settlement is made faster. To be successful at doing this, we need to nurture both parts of the solution equation, that is, creation of solution-oriented strategy and deployment of solution-based scalable technology that enables meeting of strategic goals laid out as part of our enterprise strategy. In the current scenario many insurers either rely on manual methods or custom coded solutions that lack strategic approach to address their business needs. Manual execution of their crucial operations leads to many errors that occur in documents passed from insurers to brokers or ceding companies to reinsurers, which results in lengthy settlement cycles. While custom coded interfaces are developed to meet a certain set of needs only. They are not scalable so cannot meet changing needs and require recurring IT

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investment to keep them in use. Reliance General Insurance Co. Ltd is in the process of rolling out a 'Centrally controlled, Decentralized delivery' operations structure to ensure speedy processing and service while maintaining predictable and strict quality control.A solution is also being developed to offer strategic value through systematic design and deployment of BPM and integration technologies. The solution will address volatile situations, and shall be a scalable and reusable solution. It would help meet the challenge of operational costs saving while enabling us to exploit business expansion opportunities.Creating

Technology
The IT strategy aims to integrate the business and IT visions and has been an important instrument in facilitating the dialogue between the IT community and the business leaders across the Company. The importance of planning, in this fast-paced environment, has never been more critical. The technical and business segments have worked closely to identify the impact of external drivers, clarify the business needs, and ultimately determine how IT can best help in achieving the business goals. Our Customers form the centre piece of the business architecture and rightly so, be the focal point from a technology perspective as well. Our endeavour shall be to provide easy, consistant and instant access of relevant information to customers across multiple channels and touchpoints. All our technology initiatives shall be geared towards this objective. The Company recognizes that the security of information requires an ongoing commitment. Towards this end a security program would provide a continuous cycle for assessing risk, developing and implementing effective security procedures, and

27

monitoring the effectiveness of those procedures. We want to guarantee the reliability, confidentiality and availability of critical information. To that end, we will continue implementation of our strategy for enhancing information security management controls. We are in a challenging environment, dealing with all the changes in technology, the insurance industry, the IRDA regulations and the workplace. The expectations of what information technology (IT) can do to benefit the business and its customers continue to grow. We've been working hard to provide day-to-day IT services, while keeping our eye on where the Company is headed strategically, and also transforming the IT organization to meet future requirements.

Investor Presentation

INTRODUCTION OF THE PROJECT

Objective of Project
Market strategies of the players in insurance industry Growth in health and group insurance are driving the insurance sector in India. Opportunities in this industry. Challenges to sustain the insurance market in India. Prospective areas of investment in the insurance industry in the near future.

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Factors that lead to growth.

Indian Financial Market

The financial markets are markets which facilitate the raising of funds or the investment of assets, depending on viewpoint. They also facilitate handling of various risks The financial markets can be divided into different subtypes. Capital markets Money markets Derivatives markets Insurance markets Foreign exchange markets

Primary market
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The financial market comprise of initial issue and placement of securities. Unlike in the secondary market, no organized stock exchanges are necessary. An organization that needs funds contacts their investment banker who typically assembles a syndicate of securities dealers that will sell the new stock issue. Securities dealers see this as the wholesale part of ther business. This process of selling the new stock issues to prospective investors in the primary market is called underwriting. The securities that they sell are called initial public offerings (IPOS). Dealers usually earn a commission that is built into the price of the security offering, that is, It is not apparent unless you read the prospectus in detail. This is contrasted with the retail part of the business, which is acting as an intermediary between buyers and sellers of securities in the secondary market

Secondary market
The financial market for trading of already issued securities. In the secondary market, securities are sold by and transferred from one investor to another.It is therefore important that the secondary market be highly liquid and transparent. The eligibility of Stock and bonds for trading in the secondary market is regulated through financial supervisory authorities and the rules of the market place in question. Which could be a stock exchange

Capital market
The market for long-term loans equity capital. Companies and the government can raise funds for long-term investments via the capital market. The capital market includes the stock market, the bond market, and the primary market. Securities trading on organized capital markets is monitored by the government; new issues are approved by authorities of financial supervision and monitored by participating banks. Thus, organized capital markets are able to guarantee sound investment opportunities.

Money market
A general tern for the markets in which banks lend to and borrow from each other, trade financial instruments such as Certificates of Deposit (CDS) or enter agreements such as Repose and Reverses. The market normally trades in maturities up to one year. It provides short to medium tern liquidity in the global financial system. Derivatives of the money market include forward rate agreements (FRAs) and futures.

Derivatives market

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Is any market for a derivates that is a contract which specifies the right or obligation to receive or deliver future cash flows based on some future event such as the price of an independent security or the performance of an index? Derivatives markets can be standardized (many users trading fungible contracts, typically on an exchange) Or non-standardized (where derivatives are customized for the user by a trading desk-the over the-counter market).One derivatives market is for standardized stock options, a market where parties can buy or sell, call or put options on a secondary market.Nonstandardized derivatives instruments, such as naked warrants issued directly by financial institutions to a secondary market, also exist.

Insurance
The insured makes payments called premiums to an insurer, and in return is able to claim a payment from the insurer suffers a defined type of loss. This relationship is usually drawn up in a formal legal contract. In one classic example of insurance, a ship-owner insures a ship and receives payment if the ship is damaged or destroyed. This example is one of the earliest uses and development of concepts like insurance. Interestingly, ships are now more often insured through risk pooling and spreading organization such as Lioyds of London because the loss of a large ship going down is too great for one insurer to accept. In the case of annuities, such as a pension, similar concepts apply, but in some sense in the reverse. When applied to annuities, the terms risk and loss are somewhat different from traditional insurance as they concern the chances of living beyond life expectancy and the need for income during the period between annihilation and death.

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Insurance attempts to quantify risk by pooling together a large number of risks. This makes use of the law of large numbers. As applied to insurance, this means that the greater the number of similar risks, the greater accuracy with which insurers can estimate the overall risk. For example, many individual people purchase health insurance. Policies and they each pay a small monthly or yearly premium to an insurance company. When a policyholder gets ill, the insurance company provides money to cover medical treatment. For some individuals the insurance benefits may total far more money than they have ever paid into the insurance policy. Others may never make a claim. When averaged out over all of the people buying policies, value of the claims even out. Insurance companies set their premiums based on their calculated payouts. They plan to take in more money (in premiums and in profit from the float, see below) than they pay out in the end to cover expenses. For-profit insurance companies set their rates to make a profit rather than to break even. insurance companies also earn investment profits, because they have the use of the premium money from the time they receive it until the time they need it to pay claims This money is called the float are successful, they may earn large profits, even if the insurance companies pays out in claims every penny received as premiums. In fact, most insurance companies pay out more money than they receive in premiums. The excess amount that they pay to policyholders is the cost of float. An insurance company will profit if they invest the money at a greater return than their cost of float. An insurance contract or policies will set out in detail the exact circumstances under which a benefit payment will be made and the amount of the premium.

MARKETING STRATEGIES
1. Reinvent your service: Maybe the most powerful marketing strategy, sooooo important in marketing. Take for example a creative carpet cleaner came up with a "FREE Carpet Audit" (which they took from another successful business and applied it to their industry ;-) The audit was basically a free analysis of your carpet. The result was a comprehensive report on your carpet, what is wrong with it, and how it can be fixed using various carpet treatments. This audit instantly took the struggling carpet cleaner out of the pricing game and into the VALUE game. The result was a higher perceived value of his services, and received more qualified leads and referrals (a lot more). If you want an insurance marketing strategy that will make you the expert in your industry and get more qualified leads, this is it. 32

You already have a fact finder. Use that. Rename it. Expand on it. And there is your "Audit". 2. Write with your client in mind...as if you were writing to a friend. But don't talk about yourself!!!! Remember those letters that come once a year from friends or family and they describe in excruciating detail everything about themselves and how great their family is? You know, the letters that are written in a tiny font and they go on and on about themselves? Can't stand those letters, right? People don't want to know how great you are. They want to know that you are thinking of them, that you care, and that you want to help them. Your writing and corresspondence (and your advertising) should emulate the same feelings. 3. Generate Leads and Referrals daily. Make a goal and put it in writing that you are going to get at least 10 qualified referrals every week and generate at least 20 qualified leads. Yes, go write it down now. a conscious effort to ask all your clients politely if they know anyone else interested your services. Secondly, after the second or third or fourth newsletter (the fun one we just talked about), put in a referral sheet. Third, create a lead generation system that is systematized..

EMERING TRENDS IN THE INDIAN HEALTH INSURANCE MARKETPLACE

The Indian insurance industry and its regulators are currently undertaking a number of actions to further Indias goal of developing a strong health insurance market, which would improve the general health status of Indians, ease the government burden of public care, help families avoid catastrophic financial losses, and improve the overall quality of healthcare in India. One of the biggest drivers of change comes from the seemingly unconnected propertyand-casualty insurance sector. In September 2005, the chairman of Indias Insurance Regulatory and Development Authority (IRDA) issued a road map outlining the steps non-life insurers would need to take to prepare for de-tariffing of their property casualty lines of business. (De-tariffing does away with the prescribed or agreed-upon rates usually set forth in manuals and rate tables, and introduces market competition into the rate-setting process.)

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This was a momentous decision and one that will have a huge effect on the insurance market for years to come. The new de-tariffed environment begins January 1, 2007. Although the new rules apply to property casualty lines, the impact will be strongly felt on group and individual health product rates. Previously, group health product rates were oftentimes held to minimal levels so that package rates for multiple products could be offered to employers at attractive prices. In some cases, rates of fifty rupees per member or less would be charged to make the total package rate work. This made evaluating an organizations health line profitability very difficult, at least from the outsiders viewpoint. The insurers tended to look at the total corporate profits as their measure of success, versus product-by-product performance. Moving forward, overall corporate profitability will not be the best measure. As Indian insurers move ahead, each product line will need to stand more on its own performance as separate market prices dictate success and failure of organizations product lines. It is also good public policy to require that products be priced appropriately, as this ensures more open competition as well as limits the risk of insolvency. Meanwhile, new market entrants will come onto the scene, believing they can offer better rates in one or more product areas. This will make for a highly competitive environment in 2007 and beyond.

Primary Research
In an effort to obtain a better understanding of current rating practices in India, we conducted a brief survey of Indian health insurers in mid-2006 to ascertain their methodologies to calculate health product rates and study trends. The survey was intentionally high-level and did not ask for specific pricing information, just general methodological approaches. Our initial findings confirm that organizations attempt to use the data they have to evaluate group and individual rate adequacy. Experience rating is often used for group business, with credibility weighting where appropriate. Individual business is rated using a tabular method, which reflects a number of factors such as age, gender, and family size, among others. It has been our understanding that until now the public insurers or PSUs (public sector units) and the private health insurers approach individual business slightly differently. PSUs have tended to be a little less aggressive in their rating of individual blocks of business. The survey responses appear to validate these patterns and practices. Survey implications, details, and charts are outlined below.

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The Big Picture

To put these pending changes and the existing health insurance practices in perspective, the following discussion is a general review of: The current environment in India. The various approaches to rating group and non-group business data (as apparently validated by a recent sampling of Indian carriers). How an international perspective might impact future Indian healthcare underwritingwith or without the use of new data. How todays environment is moving toward a best-case scenario, enhanced by the use of sharper data and the reality of de-tariffing.

The Current Environment in India From consumers to health insurers to government regulators and healthcare providers, there are many stakeholders in the Indian health system. Its generally anticipated that all these stakeholders will take incremental steps to yield the best improvements for Indian healthcare and health insurance. By thinking end-to-end and taking advantage of the latest technologies, these participants can fashion the best approach for India. Here are some of the special issues ahead for two big stakeholdersIndian consumers and Indian regulators. Consumers Indian culture traditionally emphasizes a philosophy of building personal financial security, placing particular importance on the well being of ones family. Indian consumers want well-designed health insurance plan/s with reasonably comprehensive coverageand without unnecessary or counterproductive gaps. Indian Mediclaim policies typically cover only medical services rendered in an inpatient hospital setting. Given todays changing world of medical delivery, Indian health insurers would be wellserved to cover a broader set of services that encourage preventive well care and healthy behaviors as well as avoid inappropriate financial incentives. When only inpatient 35

hospital services are covered, insured individuals have an incentive to seek inpatient hospital care, when lower cost treatment settings (e.g., a physician's office) may be more appropriate. Additionally programs aimed at changing unhealthy behaviors could be considered. Programs such as smoking cessation and weight control have been shown to have some success in lowering a persons future risks in some markets. For consumers to purchase health insurance, several things need to exist: Financial incentives While the desire to protect savings by itself is a strong motivator, India may well consider proposing enhanced tax treatment of insurance costs for individuals (some of which exists.) Another path not currently present inIndia is structuring financing alternatives such as medical savings accounts, which combine higher-deductible insurance coverage with money set aside in tax favored accounts for future health costs. Competitively priced products with choice To make prudent purchases,consumers should be able to choose among hospitals and other healthcare providers, along with coverage scope and insurers. Not every family situation is the same, nor does every person need or want the same coverage. Likewise, providing for non-inpatient services encourages smarter buying: Fairly priced, affordable products will ensure accessibility to the greatest number of people.

Understandable information Educating consumers about health insurance, in general, will be extremely important. Beyond awareness of insurance coverage,information on disease, cost of treatments, alternative treatment options, and the quality of the treatments provided must be available to consumers to make informed choices. Employer-sponsored programs Financing of health insurance through employer-sponsored programs is likely to improve access to insurance for some. Employers would have to be motivated to provide such coverage; again, more favorable tax treatment might be a motivating force. While it is important that health insurance provide sufficient protection to make it attractive to the buying public, care must be taken to design coverages that sufficiently involve the consumer in the cost of care, so that individuals are encouraged to behave in a

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cost-conscious way. A health insurance policy that provides 100% coverage for all services removes the patient entirely from the economic consequences of his course or

Reliance Health Wise Policy

Introduction Seeing your family in the pink of health ranks highest in priority for you. Yet, despite your best efforts, illnesses do occur. With the spiraling cost of health care, these unforeseen circumstances can take a toll on your savings. To ensure that you dont need to spend your hard earned money on treatment of any such illness; we have a Policy that offers you all the financial support that you need. Key Advantage For the first time in India, Critical Illnesses are also covered as part of your Health Insurance Policy.

A separate Double Sum Insured is automatically available as soon as any of the listed critical illnesses is diagnosed. 24 hours cashless facility at more than 3000 network hospitals. 37

Income Tax benefits under Section 80 D. Options in duration of coverage 1 year/2 year policies available. Family Floater benefit giving comprehensive protection to your family members under one single Policy. Discount on renewal premium for claim free policy. Coverage of pre-existing conditions after 2 years/4 years as per plan opted.

What does this Policy cover? Depending on the Plan opted by you, your Reliance HealthWise Policy covers: Hospitalisation Expenses - Expenses incurred towards

Hospital (room, boarding and operation theatre) Doctors & nurses Medical tests Medicines, blood, oxygen, appliances etc.

Day Care Treatment - Medical expenses towards specific technologically advanced day care treatments/surgeries where 24 hours of hospitalisation is not required. Domiciliary Hospitalisation - All expenses related to a medical treatment, which is being administered at home, subject to specific conditions applicable.

Pre and Post Hospitalisation - Medical expenses related to your treatment before and after hospitalisation for a specified number of days. Pre-Existing Diseases - Coverage of pre-existing diseases after two/four continuous renewals with us. Critical Illness - Your Sum Insured is automatically doubled separately for treatment of Cancer, Coronary artery bypass surgery, First heart attack, Kidney failure, Multiple sclerosis, Major organ transplant, Stroke, Aorta graft surgery, Paralysis and Primary pulmonary arterial hypertension. Donor Expenses - All hospitalisation expenses incurred by the Donor in case of major organ transplant are covered. What are the value added benefits available? Your Reliance HealthWise Policy offers a host of value added benefits, depending on the Plan opted by you. These include: 38

Daily Hospitalisation Allowance for a maximum period of seven days. Nursing Allowance for a maximum period of five days, on recommendation of the treating Medical Practitioner. Reimbursement of charges towards Local Road Ambulance Services. Recovery Benefit of Rs. 10,000/- in case of hospitalisation for more than ten consecutive days. Expenses of an Accompanying Person at the Hospital/Nursing Home for a maximum of five days. Cost of Health Check up at the end of a block of four years, provided there were no claims reported.

What are the additional features of this Policy?

Family Floater - Covers your family on a floater basis applicable to a maximum of four persons comprising of you, your spouse and two dependent children under the age of 21 years. Example- If Mr. Sharma and his family choose a regular health insurance plan with Rs. 1 lakh Sum Insured each; they would have to pay individual premiums for each member of the family. In addition, the cover for each Insured member would be only up to one lakh, even if the treatment costs beyond Rs. 1 lakh. But, if they take a Policy of Rs. 3 lakhs for the entire family under a floater Plan offered by Reliance HealthWise Policy, anyone from the family can claim up to Rs. 3 lakhs. Renewal Discounts - Equivalent to 5% of renewal premium, if there are no claims in the previous year

Income Tax Benefit - Premium eligible for deduction under Section 80 D of the Income Tax Act.

Who are covered under the Policy?

Children above the age of three months and adults below the age of 65 years. Children between three months and five years can be covered only if one or both the parents are covered. Maximum age to enter the Plan is 65, 60 and 55 for Standard, Silver and Gold Plan respectively.

Particulars Basic Hospitalisation Feature Domiciliary Hospitalisation Pre Hospitalisation

Standard

Silver

Gold

30 days

60 days

60 days

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Post Hospitalisation Pre-Existing Diseases Coverage Critical Illness (with separate Double Sum Insured) Donor Expenses Day Care Treatment Daily Hospitalisation Allowance Nursing Allowance (per day amount) Local Road Ambulance Service Value (maximum of) Added Feature Recovery Benefit Expenses on accompanying person (per day amount) Cost of Health Check up

60 days after 4th year x x x x Rs. 500/x Rs. 200/-

90 days after 2nd year x

90 days after 2nd year

x Rs. 250/Rs. 750/x Rs. 250/Rs. 300/ Rs. 300/Rs. 1000/-

Policy Options Choose your plan -You may choose any of the following plans

Reliance HealthWise Policy - Standard Reliance HealthWise Policy - Silver Reliance HealthWise Policy - Gold

Two-Year Policy - Continuous coverage for two years without the hassles of annually renewing your Policy. Wide range of Sum Insured

Standard - 1 lakh to 5 lakhs Silver - 1 lakh to 5 lakhs Gold - 1 lakh to 5 lakhs

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What does the Policy not cover? At Reliance General Insurance, we would like our Policy to be as transparent as possible. To ensure that you do not face any unpleasant surprises when you make a claim, we would like you to know some of the major exclusions under the Policy.

Certain ailments are not covered in the first year of the inception of the Policy. However, they are covered from the second year onwards. These are Cataract, Benign Prostatic Hypertrophy, Congenital Internal Diseases, Fistula in Anus, Piles, Hysterectomy for Menorrhagia or Fibromyoma, Hernia, Sinusitis and related disorders. This exclusion will not be applicable for roll over cases and renewals. Pre-existing illness will not be covered for the first two/four years, as per the Plan opted. Any disease contracted during the first 30 days of inception of Policy. This exclusion will not be applicable for roll over cases and renewals. Treatment of pregnancy & childbirth-related complications. Suicide, self inflicted injury or illness, mental disorder, anxiety, stress or depression, use of alcohol or drugs. Diseases such as HIV or AIDS. Cost of spectacles, contact lenses and hearing aids. Dental treatment or surgery of any kind unless requiring hospitalisation. Expenses on vitamins and tonics unless forming part of treatment for disease/injury. Naturopathy treatment or obesity related treatment. War, terrorism and nuclear weapons induced hospitalisation.

How can I get this Policy? All you need to do is fill in the necessary details in the Proposal Form and hand it over along with your cheque to your Insurance Advisor. You will instantly get a Health Kit, containing among other things your Policy and Health Card. How do I claim my insurance? You can claim your insurance through the cashless and/or reimbursement facility. To avail our cashless facility at more than 3000 of our network hospitals across the country, contact our Third Party Administrators (TPA) on the helpline numbers given on your health card. Once you submit the required documents, the TPA would arrange for cashless facility to be made available at the Hospital/Nursing Home, provided the disease/illness/injury, for which you are admitted in the hospital, is covered under your Policy. In case of an admission in a non-network hospital, inform the details to our TPA 41

on the helpline numbers given on your health card. After you get discharged from the hospital, submit all your original bills to our TPA and claim for the reimbursement. To ensure that finances never interfere with your familys healthcare

RESEARCH METHODOLOGY
Once can also define research as a scientific and systematic search for pertinent information on specific topic. Infect research is an art of scientific investigation.The advance learner dictionary of current English lays down the meaning of research as A careful investigation or inquiry especially through search for new facts in any branch of knowledge. Research methodology is a way to to systematically solve the research problem. It may be understood as a science of studying how research is down scientifically. The study undertaken by me was regarding a detailed analysis of, investors view on current scenario of insurance:-

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SAMPLE POPULATION SAMPLE SIZE SAMPLING TECHNIQUE

: : :

JAIPUR 100 Persons Random Sampling

Random Sampling ensure the law of statistical regularity which states that the sample is chosen randomly.

HOUSEHOLD CUSTOMER The household customer who has established a customer relationship that is a continuing with a broker dealer that provides a financial product or service to the consumer primarily for personal, family or household purpose. Information infrastructures that allow for household required to be successful in marketing and changing policies, prices, account, location, cost and customer communication. House holding refers to understanding the key relationship with two or more customer to know the potential opportunities and increased satisfaction or dissatisfaction based on communication with individual or multiple customers. A data warehouse would have provided intelligent to produce a better mailing list of appropriately delineated and evaluated customer.

SEGMENTATION
The house hold customer segmentation consists of a group of those household customers who need to be change in financial policies, there or cost and services? The customer segmentation is: Professional Income Age Geographical area

Professional:
Those household customer they are professional like: Household home business, household retired female, household retired male etc they are professional household customer. 43

Income
In this household customer segmentation consist of high and low income. Income Consist of Household income less 2 lac Household income 2 lac 4 lac Household income 4 lac- 10 lac Household income 10 lac- more than 10 lac

Age
In this household customer segmentation consist of customer age like: Household age 20-30, Household age 30-40, household age 50-60.

Geographical Area:
In this segmentation consists of customer Geographical areas are: Urban Area Rural Area

URBAN AREA :
Those household customer they needs performance, performance Quality and new consumer. This segmentation is consisting of new service and high quality performance.

RURAL AREA:
In these Indian rural area population are generally illiterate, basically they working daily wages basis. So rural area customer are need minimum investment and maximum benefits.

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Research Design:
Fundamental to the success of any formal marketing research project is sound research design. Research design is the basic framework, which provides guidelines for the rest of research process. It is map or blueprint according to which the research is to be conducted. The function of research design is to ensure that the required data are collected and economically. Data Collection Method There are two types of data collection method: Primary Data Secondary Data

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In the section of researcher project, the requirement is to describe the source of collecting and secondary data.

Source of Primary Data Collection

Natural market 1. Relatives 2. Friends 3. Neighbors Stall operation Survey

Source of Secondary Data Collection

Database from company Reference data Telecalling leads

Sample Size
The study is based on a survey of 100 respondents through questionnaire covering different groups of investors.

Methodology
1. 2. 3. 4. 5. Prepare a list of information needed. Frame Questionnaire Collect information Convert information into data and graph Analyze and Interpretation.

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FINDINGS FROM THE RESEARCH

Market Share Of RELIANCE In The Life Insurance Industry

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Company Name LIC ICICI PRU Bajaj Aliance SBI Life HDFC STANDARD LIFE Reliance Life MAX New York

PREMIU Total Avg M RANK Policies RANK Prem/Policy RANK 55934.7 1 3.80E+07 1 14631 14 5254.64 2 1960034 3 26808 5 4269.78 3 2079217 2 20536 9 2566.08 4 565701 4 45361 1 1624.04 930.46 920.34 48 5 6 7 525147 450917 552670 6 7 5 31047 20634 16652 3 8 13

Birla Sun Life AVIVA Life TATA AIG Kotak Mahindra ING Vysya Met Life Shiram Life Sahara Life Bharti AXA

882.72 724.03 642.35 614.94 467.44 344.09 179.78 43.17 7.77

8 9 10 11 12 13 14 15 16

426746 297555 408797 165203 229223 119610 96078 41663 5703

8 10 9 12 11 13 14 15 16

20684 24332 15713 37223 20391 28768 18711 10361 13624

7 6 12 2 10 4 11 16 15

CONCLUSION
In the financial product all the companies are doing their business based on their customer centered view and looking at the customers satisfaction only and for that they are they are using all the marketing efforts. In determining the overall market, marketing strategies and the market potential for household customer expectation.In this research we are getting some conclusion From the analysis of the responses received from the investors in Jaipur. City, a majority of investors are found to be conscious and enlightened regarding their investments, return & growth. 49

We have very good market in Jaipur which comprises potential investors but due to lack of basic promotion & publicity these investors are not fully aware of our company & whosoever is aware of our company. Their investment decisions are done on the basis of security, analysis of risk yield & few parameters like Demographic, Physiological , Income, etc. So my finding are that Reliance money should make little more efforts to trap the potential investors, like Media advertisement, Seminars & /business Meets & building a good relationship with potential business, moreover friendly guidance.

Suggestions
1. Steps should be taken to make fair and truthful disclosure of information to investors, so that subscriber knows why insurance is necessary. 2. Insurance need to take advantage of modern technology like computer and telecommunications to render service to the investor. 3. As the investors are not willing to invest in insurance unless a sum asuured or minimum return is assured, it is very essential to create the mind of the investors that insurance are market instruments and associated to cover the risk of lif e and of many things.

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LIMITATIONS OF STUDY
This survey report is also not from limitations as usual. However the absence of such limitation would have improved the quality n of report as given below: 1. Limited time period restricted to go in for more details the period was very short to survey such a large area. 2. Many respondents were not interested to give the required time for the questionnaire. 3. Respondents some times act artificially when they know their information is noted down for some purpose.

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4. Some housewife, Business man/women and self employee denied giving any type of information. 5. There was only some certain hours in a day in the idle hours during which the household customer were ready to talk. 6. More data and information would have have helped the study.

ANNEXURE 1 QUESTIONAIRE
Dear Sir/Madam, This research is an effort to find the Marketing of Insurance Products and expectation of the customer. The information given by you will be used for research purpose and will be kept confidential. Your kind co-operation in this regard is earnestly solicited. Thanking you. Ashish Mathur.

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NAME: AGE: ADDRESS: TELEPONE NO. ANNUAL INCOME YOUR OCCUPATION:

SEX: MALE/FEMALE

Q.1 How many members are there in your home? Ans. MALE FEMALE CHILD Q.2 How many members will earn in your home? Ans. Q.3 What is your source of income? Ans. Salary Business Self Employee Others Q.4 How many type of insurance do you have? Ans. 1 2 3 More than 3 Q.5 Where you have invested your money? Ans. Insurance Mutual funds Fixed Deposit Q.6 How much amount you invest annually? Ans. Rs.5000 Rs.10000 Rs.15000 More than Rs.15000 None Q.7 What type of investment you like? Ans. Annual investment Half yearly investment Quarterly investment Q.8 Are you satisfied to your investment ? Ans. Yes

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No. Q.9 What kind of insurance policy would you like to take? Ans. Term Insurance Policy Whole Life Policy Endowment Policy Money Back Policy Annuities And Pension Q.10 How many year you will invest your money in any scheme? Ans 1 year 2 year 3 year 4 year More than 5 year Q11. Which type of investment you like to make? Ans. Long term Mid term Short term

Demographic Profile Fill up your details in the table below. For every attribute; if you fall in column A, enter "1" in the score column. For every attribute; if you fall in column B, enter "0" in the score column.
Attribute Sex Age Income Occupation Educational Background Experience in investing Total Score A Male <=50 years >=5 Lacs p.a. Self Employed Graduation and above >=3 years B Female >50 years <5 Lacs p.a. Salaried Less than graduation <3 years Score

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ANNEXURE 2 QUESTIONAIRE
Dear Sir/Madam, This research is an effort to find the Marketing of Insurance Products and expectation of the customer. The information given by you will be used for research purpose and will be kept confidential. Your kind co-operation in this regard is earnestly solicited. Thanking you. Ashish Mathur

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

Name: Address: Contact No.: Age: Gender: Monthly Income: Male <10000 25000-50000 > 100000 Female 1000-250000 50000-100000

7.

Occupation:

Business Student

Service Housewife

8.

Marital Status:

Married

Single

9.

Please tick the company whose Insurance plan you have taken? Aviva HDFC Standard Bajaj Allianz LIC Kotak ICICI Prudential Reliance

10. Which products from the bank you are currently having?

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 11.

Fixed Deposit Mutual Fund Life Insurance General Insurance

What kind of response do you get from the company regarding any problem? Very good Good Satisfactory Bad

12

From the following features of the company, please tick the features, which are most attractive? Aggressiveness Behaviour Service Work Tendency

13

Are you satisfied with the Services of the Company? Fully Not satisfied Partially Can't say

BIBLOGRAPHY
RESEARCH METHODOLOGY: C.R.KOTHARI MARKETING MANAGEMENT: PHILIP KOTLER WEBSITES: www.google.com www.personalfn.com www.irda.com RELIANCE CAPITAL INVESTORS GUIDE

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MAGZINES: Business today Brochures of reliance money

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