SUMMER TRAINING PROJECT REPORT

ON

Submitted in partial fulfillment of the requirement of bachelor of

Business Administration (BBA)
GURU JAMBHESHWAR UNIVERSITY, HISAR

CUSTOMER BUYING BEHAVIOUR TOWARDS

INSURANCE POLICIES

Training Supervisor:

Submitted By:_____________

Mr. Rajneesh Sharma

Enrollment :
(H.R. Manager)

SESSION: 2006-2009

GURU JAMBHESHWAR UNIVERSITY

HISAR

PREFACE
As a part of course curriculum of my BBA program we are asked to undergo two
months summer training in any organization so as to give us exposure to practical
management & to get us familiar with various activities taking place in an organization.
I have put my sincere efforts to accomplish my objectives within the stipulated
time. Despite all the limitations, obstructs-hurdles, and hindrances, I have filed and
worked to my optimum potential to achieve the desired goal. Being neophytes in the
highly competitive world of business. I come across some difficulties to make my
objective a reality. Any how, with the kind help and genuine interest of one all all
formally supported by guidance of my guide. I am presenting this hand carved effort is
coloured. I tried my level best to conduct a research to gain a through knowledge about
the project in the topic "Customer Buying Behaviour towards Insurance Policies" I
have put the best of my efforts and have also tried to be justice with the available. If
anywhere something is found unacceptable or unnecessary to the theme you are
welcomed with your valuable suggestions.
Thanks and regards.

_____________

ACKNOWLEDGEMENT
A successful and satisfactory completion of any project is the outcome of invaluable and
aggregate contribution of personal skill in the radical direction and the guidance of the
concerned Authorities. Even the best efforts are wasted without a proper guidance and
advice. The success of any project is the result of hardwork, dedication and the support of
the well wishers. I wish to express my gratitude and appreciation to all those who stood
by me and gave me all the possible help. First and foremost my intellectual debt to my
project guide Mr. Harish Malhotra director is one for helping me in various ways, despite
his preoccupation with his own Routine and Mr. Pankaj Chanden (Asstt. Manager H.R.)
My sincere Thanks to all the people in HR department for giving their valuable
suggestions and help in the project.
Finally I thank all the individuals whom I met during the completion of project and was
obligingly granted information which eventually formed the life-blood of the project.

________________

CONTENTS
CHAPTER 1 : INTRODUCTION
1.1

Overview of Industry as a whole

1.2

Profile of the organization

1.3

Problems of the organization

1.4

Competition Information

1.5

S.W.O.T. Analysis of the Organization

4-38

CHAPTER 2 : OBJECTIVE AND METHODOLOGY

2.1

Significance of the study

2.2

Managerial usefulness of the study

2.3

Objectives of the study

2.4

Scope of the study

2.5

Methodology

39-43

CHAPTER 3 : CONCEPTUAL DISCUSSION

44-56

CHAPTER 4 : DATA ANALYSIS

57-67

CHAPTER 5 : FINDINGS AND RECOMMENDATION

68-74

ANNEXURES

75-80

BIBLIOGRAPHY

81

CHAPTER 1

INTRODUCTION

INTRODUCTION
1.1

OVERVIEW OF INDUSTRY AS A WHOLE

Insurance allows someone who suffers a loss or accident to be compensated for the
effects of their misfortune. It lets you protect yourself against everyday risks to your
health, home and financial situation
Insurance, in law and economics, is a form of risk management primarily used to
hedge against the risk of a contingent loss. Insurance is defined as the equitable transfer
of the risk of a potential loss, from one entity to another, in exchange for a premium.
Insurer, in economics, is the company that sells the insurance. Insurance rate is a factor
used to determine the amount, called the premium, to be charged for a certain amount of
insurance coverage. Risk management, the practice of appraising and controlling risk, has
evolved as a discrete field of study and practice.
Reimbursement in a situation of loss. Usually, someone decides that insurance is
needed. In order for the concept of insurance to arise, a pre-payment of some type is
required. In the case of typical, everyday general auto, health and life insurance.
Put basically, insurance enables those who suffer a loss or accident to be compensated
for the effects of their misfortune. The payments come from a fund of money
contributed by all the holders of individual insurance policies. In other words,
individual risks are pooled and shared, with each policy holder making a contribution
to the common fund.

The contributions have the premium. Premiums are paid to insurers - these are
institutions which accumulate the money into the fund from which claims are paid. The
loss is in fact paid for by the policyholder making the claim and by all the other
policyholders who cuts not suffered in the same way.
Two factors arise when calculating the premium.
5

1. Firstly, the general likelihood that has loss will occur.

2. Secondly, whether the particular policyholder is above gold below average in risk.
Insurer are professional risk takers. They know the probability of different standard of
risk happening. They edge calculate the premiums needed to create has fund broad
enough to cover likely loss payments. Clearly, only has proportion of policyholders will
require compensation from the fund At any one time.
Someone who is Young, made and in A risk-free job will find it easier to buy life
insurance, and will pay lower premiums than someone who has has heart condition gold
is in A risky occupation.
Accelerated Benefits Rider: A life insurance rider that allows for the early payment of
some portion of the policy's face amount should the insured suffer from a terminal illness
or injury.
Accidental Death Benefit Rider: A life insurance policy rider providing for payment of an
additional cash benefit related to the face amount of the base policy when death occurs by
accidental means.
Accidental Death Insurance: Insurance providing payment if the insured's death results
from an accident.
Agent: An authorized representative of an insurance company who sells and services
insurance contracts.
Annually Renewable Term: A form of renewable term insurance that provides coverage
for one year and allows the policy owner to renew his or her coverage each year, without
evidence of insurability. Also called yearly renewable term.
Assignment Assignment: The transfer of the ownership rights of a Life Insurance policy
from one person to another.

Attained Age: Your current age. Your attained age is one of the factors life insurance
companies use to determine your premiums. The older you are, the greater chance you'll
die while you are covered - so the higher your premium.
Backdating: A procedure for making the effective date of a policy earlier than the
application date. Backdating is often used to make the age of the consumer at issue lower
than it actually was in order to get lower premium. State laws often limit to six months
the time to which policies can be backdated.
Beneficiary: The person designated to receive the death benefit when the insured dies.
Binder: A temporary insurance policy that expires at the end of a specific time period or
when the permanent policy is written. A binder is given to an applicant for insurance
during the time the complete policy paperwork is being completed. Assignment
Assignment: The transfer of the ownership rights of a Life Insurance policy from one
person to another.
Cash Benefits: Money that is paid to the insured upon settlement of a covered claim.
Often found with Hospital Income Programs, "cash benefits" are paid directly to the
insured rather than the doctor or the hospital directly.
Cash Value: The equity amount or "savings" accumulation in a whole life policy. Claim
Notification to an insurance company that payment of an amount is due under the terms
of the policy.
Conditional Receipt: Given to policy owners when they pay a premium at time of
application. Such receipts bind the insurance company if the risk is approved as applied
for, subject to any other conditions stated on the receipt.
Contestable Clause: A provision in an insurance policy setting forth the conditions under
which or the period of time during which the insurer may contest or void the policy. After
that time has lapsed, normally two years, the policy cannot be contested. Example:
Suicide.
Contingent Beneficiary: Person or persons named to receive proceeds in case the original
beneficiary is not alive. Also referred to as secondary or tertiary beneficiary
7

HISTORY OF INSURANCE
In some sense we can say that insurance appears simultaneously with the appearance of
human society. We know of two types of economies in human societies: money
economies (with markets, money, financial instruments and so on) and non-money or
natural economies (without money, markets, financial instruments and so on). The second
type is a more ancient form than the first. In such an economy and community, we can
see insurance in the form of people helping each other. For example, if a house burns
down, the members of the community help build a new one. Should the same thing
happen to one's neighbour, the other neighbours must help. Otherwise, neighbours will
not receive help in the future. This type of insurance has survived to the present day in
some countries where modern money economy with its financial instruments is not
widespread (for example countries in the territory of the former Soviet Union).
Turning to insurance in the modern sense (i.e., insurance in a modern money economy, in
which insurance is part of the financial sphere), early methods of transferring or
distributing risk were practiced by Chinese and Babylonian traders as long
ago as the 3rd and 2nd millennia BC, respectively. Chinese merchants traveling
treacherous river rapids would redistribute their wares across many vessels to limit the
loss due to any single vessel's capsizing. The Babylonians developed a system which was
recorded in the famous Code of Hammurabi, c. 1750 BC, and practiced by early
Mediterranean sailing merchants. If a merchant received a loan to fund his shipment, he
would pay the lender an additional sum in exchange for the lender's guarantee to cancel
the loan should the shipment be stolen.
Achaemenian monarchs were the first to insure their people and made it official by
registering the insuring process in governmental notary offices. The insurance tradition
was performed each year in Norouz (beginning of the Iranian New Year); the heads of
different ethnic groups as well as others willing to take part, presented gifts to the
monarch. The most important gift was presented during a special ceremony. When a gift
was worth more than 10,000 Derrik (Achaemenian gold coin weighing 8.35-8.42) the

issue was registered in a special office. This was advantageous to those who presented
such special gifts. For others, the presents were fairly assessed by the confidants of the
court. Then the assessment was registered in special offices.
The purpose of registering was that whenever the person who presented the gift
registered by the court was in trouble, the monarch and the court would help him. Jahez,
a historian and writer, writes in one of his books on ancient Iran: "[W]henever the owner
of the present is in trouble or wants to construct a building, set up a feast, have his
children married, etc. the one in charge of this in the court would check the registration. If
the registered amount exceeded 10,000 Derrik, he or she would receive an amount of
twice as much."
A thousand years later, the inhabitants of Rhodes invented the concept of the 'general
average'. Merchants whose goods were being shipped together would pay a
proportionally divided premium which would be used to reimburse any merchant whose
goods were jettisoned during storm or sinkage.
The Greeks and Romans introduced the origins of health and life insurance c. 600 AD
when they organized guilds called "benevolent societies" which cared for the families and
paid funeral expenses of members upon death. Guilds in the Middle Ages served a similar
purpose. The Talmud deals with several aspects of insuring goods. Before insurance was
established in the late 17th century, "friendly societies" existed in England, in which
people donated amounts of money to a general sum that could be used for emergencies.

1.2 PROFILE OF THE ORGANIZATION

ABOUT SH.DHIRUBHAI AMBANI

Few men in history have made as dramatic a contribution to their countrys economic
fortunes as did the founder of Reliance, Sh. Dhirubhai H Ambani. Fewer still have left
behind a legacy that is more enduring and timeless.
As with all great pioneers, there is more than one unique way of describing the true
genius of Dhirubhai: The corporate visionary, the unmatched strategist, the proud patriot,
the leader of men, the architect of Indias capital markets, the champion of shareholder
interest.
But the role Dhirubhai cherished most was perhaps that of Indias greatest wealth creator.
In one lifetime, he built, starting from the proverbial scratch, Indias largest private sector
enterprise.
When Dhirubhai embarked on his first business venture, he had a seed capital of barely
US$ 300 (around Rs 14,000). Over the next three and a half decades, he converted this
fledgling enterprise into a Rs 60,000 crore colossusan achievement which earned
Reliance a place on the global Fortune 500 list, the first ever Indian private company to
do so.

10

Dhirubhai is widely regarded as the father of Indias capital markets. In 1977, when
Reliance Textile Industries Limited first went public, the Indian stock market was a place
patronised by a small club of elite investors which dabbled in a handful of stocks.
Undaunted, Dhirubhai managed to convince a large number of first-time retail investors
to participate in the unfolding Reliance story and put their hard-earned money in the
Reliance Textile IPO, promising them, in exchange for their trust, substantial return on
their investments. It was to be the start of one of great stories of mutual respect and
reciprocal gain in the Indian markets.
Under Dhirubhais extraordinary vision and leadership, Reliance scripted one of the
greatest growth stories in corporate history anywhere in the world, and went on to
become Indias largest private sector enterprise.
Through out this amazing journey, Dhirubhai always kept the interests of the ordinary
shareholder uppermost in mind, in the process making millionaires out of many of the
initial investors in the Reliance stock, and creating one of the worlds largest shareholder
families.
Their new identity reflects our commitment and passion to shape a better future, create a
higher quality of life, and giving wing to a million dreams and aspirations
Reliance Anil Dhirubhai Ambani Group, an offshoot of the Reliance Group founded by
Shri Dhirubhai H Ambani (1932-2002), ranks among Indias top three private sector
business houses in terms of net worth. The group has business interests that range from
telecommunications (Reliance Communications Limited) to financial services (Reliance
Capital Ltd) and the generation and distribution of power (Reliance Energy Ltd).
Reliance ADA Groups flagship company, Reliance Communications, is India's largest
private sector information and communications company, with over 30 million
subscribers. It has established a pan-India, high-capacity, integrated (wireless and
wireline), convergent (voice, data and video) digital network, to offer services spanning
the entire infocomm value chain.

11

Their symbol Reliance APEX conveys the spirit of excellence, the human urge for
progress, the desire to reach higher, the resolve to shape a better future
The APEX is the highest point the pinnacle an abiding symbol of hope and optimism,
achievement and success.
The BLUE in Reliance APEX represents the inner strength, the self belief, the quiet
confidence, the sense of purpose that go into the making of an epic journey.
The RED in Reliance APEX represents the energy and dynamism that propels one to the
pinnacle of ones ambition.
Brand Colors

12

INTRODUCTION OF RELIANCE CAPITAL

RELIANCE CAPITAL LIMITED

RCL is registered as a depository participant with National Securities Depository Ltd
(NSDL) and Central Depository Services Ltd (CDSL) under the Securities and Exchange
Board of India (Depositories and Participants) Regulations, 1996. RCL has sponsored the
Reliance Mutual Fund within the framework of the Securities and Exchange Board of
India (Mutual Fund) Regulations, 1996.RCL primarily focuses on funding projects in the
infrastructure sector and supports the growth of its subsidiary companies, Reliance
Capital Asset Management Limited, Reliance Capital Trustee Co. Limited, Reliance
General Insurance Company Limited and Reliance Life Insurance Company Limited. As
of March 31, 2005, the companys investment in infrastructure projects stood at Rs. 1071
Crores. The investment portfolio of RCL is structured in a way that realizes the highest
post-tax return on its investments
Reliance Capital is one of Indias leading and fastest growing private sector financial
services companies, and ranks among the top 3 private sector financial services and
banking companies, in terms of net worth.
(http://www.reliancecapital.co.in)

13

RELIANCE
MUTUAL
FUNDS

RELIANCE
LIFE
INSURANCE

RELIANCE
GENERAL
INSURANCE
RELIANCE
CAPITAL LTD.

RELIANCE
CONSUMER
FINANCE

RELIANCE
MONEY

1) Reliance Mutual Fund (RMF)

Reliance Mutual Fund, a part of the Reliance - Anil Dhirubhai Ambani Group (RADAG) is one of the fastest growing mutual funds in the country .Reliance Mutual Fund
offers investors a well rounded portfolio of products to meet varying investor
requirements. Reliance Mutual Fund (RMF) is one of Indias leading Mutual Funds, with
Assets Under Management (AUM) of Rs. 59,857 crore (AUM as on 30th June 2007) and
an investor base of over 3.4million. Reliance Mutual Fund constantly endeavours to
launch innovative products and customer service initiatives to increase value to
investors.Reliance Mutual Fund schemes are managed by Reliance Capital Asset
Management Ltd., a wholly owned subsidiary of Reliance Capital Ltd. Reliance Capital
is one of India's leading and fastest growing private sector financial services companies,
and ranks among the top 3 private sector financial services and banking
companies.Reliance Capital has interests in asset management and mutual funds, life and

14

general insurance, private equity and proprietary investments, stock broking and other
financial services
(http://www.reliancemutual.co.in)

2) Reliance Money
Reliance Money is a group company of Reliance Capital; one of India's leading and
fastest growing private sector financial services companies, ranking among the top 3
private sector financial services and banking companies, in terms of net worth. Reliance
Capital is a part of the Reliance Anil Dhirubhai Ambani Group.
Reliance Money is a comprehensive electronic transaction platform offering a wide range
of asset classes. Its endeavour is to change the way India transacts in financial markets
and avails financial services. Reliance Money is a single window, enabling you to access,
amongst others in Equities, Equity & Commodities Derivatives, Mutual Funds, IPOs,
Life & General Insurance products, Offshore Investments, Money Transfer, Money
Changing and Credit Cards.
(http://www.reliancemoney.com)

3) Reliance Consumer Finance

Reliance Capital is entering the consumer finance business through a tie-up with HDFC
Bank. The credit card business is first on its list of preferences and the present move
would facilitate just that. This would be followed up by an entire range of activities like
housing, auto and personal loans.
According to sources, the agreement would basically cater to the credit card business.
The formal announcement will come in the next few weeks as the final modalities are
being worked out. When contacted by ET, a Reliance Capital spokesman confirmed that
discussions were on with a bank, but declined to divulge any details.

15

As per industry estimates, there are around 18.3m credit cards currently in use in the
Indian market. The field is dominated by Citibank, Standard Chartered Bank, HSBC and
the State Bank of India. The other prominent players include ICICI, HDFC and ABN
Amro.
The issuing potential is estimated at a significantly higher 220m by 10. What also
enthuses new players is the low penetration levels in the Indian credit card market.
Against a global average of 4.6%, Indias penetration is said to be below 1%. On the flip
side, annual spend per credit card in India is just $378. The reasons for low spend include
lack of acceptance infrastructure and high interest rate regime.
For the Rs 950-crore Reliance Capital, which operates in the insurance, mutual fund,
stock broking and private equity space, credit cards would be its first product in the
consumer finance space. It demonstrates its growing appetite to enlarge its scope as a full
financial service player. Besides, its volumes in the credit cards business could also be
shored up and complemented by its mutual funds and insurance activities.
(http://economictimes.indiatimes.com/articleshow/2015608.cms)

4) Reliance General Insurance

Reliance General Insurance offers a wide range of products for corporate and individual
customers. With a focus on customer centric products, multiple distribution channels and
technology adoption we aim to capture substantial market share across product lines.
Reliance General Insurance, a Subsidiary of Reliance Captial, is one of the first non-life
companies to get the license from the IRDA. RGICL offers an exhaustive range of
insurance products that covers most risks including Property, Marine, Casualty and
Liability.Reliance General Insurance is the fastest growing private sector general
insurance company in India with innovative product offerings and customer service
standards that are benchmarked to the best insurance practices in the world
16

4) Reliance Life Insurance

Past profile of reliance life insurance
Reliance Life Insurance Company Limited is a part of Reliance Capital Ltd. of the
Reliance - Anil Dhirubhai Ambani Group. Reliance Capital is one of Indias leading
private sector financial services companies, and ranks among the top 3 private sector
financial services and banking companies, in terms of net worth. Reliance Capital has
interests in asset management and mutual funds, stock broking, life and general
insurance, proprietary investments, private equity and other activities in financial
services.
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.
Reliance Capital 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.
Reliance Life Insurance is another step forward for Reliance Capital Limited to offer
need based Life Insurance solutions to individuals and Corporates.
Reliance Life Insurance has a pan presence and a range of products catering to individual
as well as corporate needs
A total of 16 products covering savings, protection & investment requirements

17

GOAL
Reliance Life Insurance would strive hard to achieve the following goals:

Emerge as transnational Life Insurer of global scale and standard

Achieve impeccable reputation and credentials through best business practices

Guiding Principles
-Customer Care and Satisfaction
-CorporateGovernance
-CreativityandInnovation
-Competitiveness

Vision : Empowering everyone live their dreams

Mission : Create unmatched value for everyone through dependable, effective,

transparent and profitable life insurance and pension plans
-

18

PRODUCTS OF RELIANCE LIFE INSURANCE

Individual plans
Savings (Endowment)
Reliance Endowment Plan
Reliance Special Endowment Plan
Reliance Cash Flow Plan
Reliance Child Plan
Reliance Whole Life Plan
Reliance Connect 2 Life Plan
Retirement
Reliance Golden Years Plan
Reliance Golden Years Plan Value
Reliance Golden Years Plan Plus
Unit Linked
Reliance Automatic Investment Plan
Reliance Money Guarantee Plan
Reliance Market Return Plan

Employee benefit plans

Risk (Protection)
Reliance Group Term Assurance Policy
Reliance EDLI Scheme
Pensions
Reliance Group Gratuity Policy
Reliance Group Superannuation Policy

Risk / Protection
Reliance Term Plan
Reliance Simple Term Plan
Reliance Special Term Plan
Reliance Credit Guardian Plan

19

Working Environment

To be a part of world-class sales team

Work from your own office or residence

Work full time or part time

Earn commission, Bonus, & Incentives

No upper limits on earnings

Flexible career.

Life Line

A-40
ME-5L

A-20
ME2.4L

A-60
ME5L*20

A-40

A-AGE
ME-MONEY EARNED
L-LAKH
20

Life Line

Children
education

Debt and
mortgage
expenses

Children
marriage

10 CRORE

Retirement
expenses

House hold
expenses

Miscellaneous
expenses

For example :- If the person starts earning from the age of 21 and earns Rs.20000 per
month that means Rs.2.4 lacks per annum and now the current age of the man is 40 yrs so
we can assume with the nominal increment in his income he will earn approx Rs.4 crore.
And he would like to have retirement probably at the age of 60yrs. Surely he would like
to enjoy standardized life after 60 yrs. He would have earned Rs.10 crore between those
20 yrs that means he has the worth of Rs.10 crore. What if the figure of Rs10 crore get
vanish in the midst of 40 to 60 yrs? He has incurred all the expenses via: children
education, children marriage household expenses, miscellaneous expenses, retirement
expenses. Mortgage and debt expenses etc .These expenses so imperative that they have
to be incurred even if that man does not exist.
There is no another liquidized asset other than the insurance which he will get
immediately at the time of death.

21

There are two types plans which the company offered to me for sale, they are
as follows:a) Life maker insurance investment plan
b) Child money back plan

1. Life maker insurance investment plan

A unit linked insurance plan that enables you to manage your investments and fulfill your
lifes needs.
Life gives you a lot of choices-especially when youre looking for ways to protect your
family, build the business you aim to own and the life style you hope to establish. But
things may change along the way and you may have to adjust to the changes which life
brings to you and this adaptability should also be available with your life insurance plan.
Our Unit linked Life Insurance plan can be the financial cornerstone for your objectives.
Life Maker

TM

Premium Investment Plan provides you a solution to fulfill all your

dreams, whether youre buying a home, starting a family, launching a business venture.
RELIANCE Life Insurance provides you a powerful investment-cum-insurance plan that
empowers you to manage your investments through your insurance policy. In this unit
linked plan, you can direct your investments in our customized unit linked funds, which
offer investments of different types: Fixed Income (e.g. Govt. Securities, Company
Debentures) and Equities (i.e. shares). Hence it is a one-stop option to fulfill all your
plans without the hassle of managing multiple products
KEY BENEFITS

Protection
Attractive Returns
Liquidity
Tax Benefits
Flexible Investments
PROTECTION-This policy provides you comprehensive protection incase of

22

Death
Level Insurance Cover - In the unfortunate event of your death anytime during the tenor
of the plan, we will pay to your nominee(s) the higher of the Sum Assured or the Fund
Value in the policy.

Disability
Personal Accident Benefit (PAB) Rider This rider provides a lump-sum amount if you
die by accident or are involved in an accident, which results in Total and Permanent
Disability.

Disease
Dread Disease (DD) Rider This rider provides a lump-sum amount on you being
diagnosed with any of the ten dread diseases covered or your undergoing the surgery
covered.
Please note that the rider Sum Assured cannot exceed the Sum Assured of the base plan
and the rider Sum Assured is subject to limits.

RETURNS-This policy provides you competitive returns in the form of Maturity Benefit
On maturity, we will pay you the Fund Value. However, if you do not want the proceeds
on maturity (due to adverse market movements or to take advantage of a bull run etc.),
you may choose to defer it up to 5 year by opting for the Settlement option.

Loyalty Units

23

We will allocate free units (called Persistency Units) to your unit account on the 9th
policy anniversary and on every 3rd anniversary thereafter. These will be equal to 0.75%
of your fund values on the immediately preceding 36 month anniversaries
LIQUIDITY- This policy provides you easy liquidity via-

Partial Withdrawal- Withdraw up to 20% of your Fund value as on previous policy

anniversary, to take care of any irregular expenses. Partial Withdrawals are allowed once
Policy completes 3 Years.

Surrenders- Incase of unforeseen needs ensures easy liquidity to you by accessing your
fund through surrender benefit. However, full surrender is possible only after the
completion of three policy years.
TAX BENEFITS- This plan entitles you to tax benefits under-

U/s 10(10D) of the Income Tax Act 1961 on the Maturity proceeds of the Policy
U/s 80C of the Income Tax Act 1961 on the Annual Premium on the Policy

FLEXIBILITY

Flexibility to Choose the Insurance Cover: You have the option to choose
your sum assured from a wide range of available limits. This feature gives you an
opportunity to direct your money towards investments or towards coverage, depending on
your need
High or low Sum Assured will not change the premium.

Flexibility to Choose Premium Payment Term: You have the flexibility to

choose the premium payment term between Regular Pay and Limited Pay (5/10/15
years). Suitable for all kind of cash flows of any individual.

Flexibility to Choose Policy Term: You can choose the policy term from a wide
range of 10 years to 30 years, subject to a maximum maturity age of 75.

24

Flexible Investment: You have the flexibility to direct your investments in any one or
more of the following five unit linked investment funds of the Company: SECURE,
CONSERVATIVE, BALANCED, GROWTH and GROWTH SUPER. These funds invest
in Fixed Income and equity assets as follows:.

FUND ->
INVESTMENT TYPE

Government
Securities
Corporate Bond
(Investment Grade
Money Market
Instrument/Cash
Equities

SECURE CONSERVATIVE BALANCED GROWTH

GROWTH
SUPER

FUND

FUND

FUND

FUND

50-100%

50-80%

20-50%

0-30%

0-20%

0-50%

0-50%

20-40%

0-30%

0-20%

0-20%

0-20%

0-20%

0-20%

0-20%

Nil

010%

10-40%

10-70%

70-100%

FUND

Invest more through fund Top-ups to match your cash flows : You can invest
extra money in your policy through occasional top-ups at anytime post the policy
commencement dates. However, cumulative top ups will be allowed only up to 25% of
the cumulative Annual Target Premium till date. Top ups will not effect the Sum Assured

Switch across funds: This plan allows you to switch between funds and allows you to
change your risk return profile of your existing investments. The switch option we offer
is one of the most powerful and flexible ones in the market where money from one fund
can be switched to multiple funds in a single switch. 6 Free switches are available to you
in a Policy Year.

Re-direction: This plan allows you to re-direct your future premiums. You can invest
your future premiums in a fund different from your earlier fund, or to multiple funds in a
ratio different from your earlier ratio. 3 free re-directions are available to you in a policy
year

25

Eligibility Conditions
Entry Age (age as at Any age between 91 days to 65 years (maximum issue age is 50
last birthday)
years with DD rider & 55 with PAB rider)
Premium
Payment Regular Pay- Equal to Policy Term
Term
Limited Pay- 5/10/15 years
Policy Term (in whole Regular Pay
years)

Pick-a-tenor (10 years to 30 years)

Limited Pay
5 Pay- 10 years policy term
10 Pay- 20 years policy term
15 Pay- 30 years policy term

Maximum

(subject to maximum age at maturity of 75 years)

Maturity 75 years on last birthday

Age
Minimum
Assured
Minimum

Sum Rs.1,00,000
Annual Rs.20,000

Target Premium

26

2. Child money back plan

As a loving parent, you dream for a bright future of your children. This depends on the
education and the support they receive from you. You work hard to ensure their quality of
education and support them with sufficient capital for their future endeavors.
You want to be sure that the dream you have for your child is secure and fulfilled, under
all circumstances.
Introducing RELIANCE Lifes Stepping Stones TM, a smart way to plan your childrens
future. It is a life insurance plan with regular paybacks ensuring money when it is
required, during all scenarios.

KEY BENEFITS
1. Guaranteed money when you need it
You get a guaranteed 100% of sum assured in three convenient installments designed to
give you money at important milestones in your childs life:

30% of sum assured at 5 years before maturity

35% of sum assured at 2 years before maturity

35% of sum assured on maturity

Additional guaranteed 30% of the sum assured on maturity

27

2. Peace of mind

In the event of the unfortunate incident of your early death during the plan period, your
childs future remains secure.

100% sum assured is paid to your nominee immediately to meet unforeseen

expenses.

Your nominee would still receive all remaining money back payments on due
dates as the policy continues.

Moreover, a full waiver of future premiums benefits is built in, ensuring that your
family is not financially burdened, and not required to pay future premiums.

28

ADDITIONAL BENEFITS
Bonus
This is a participating plan, eligible for bonuses. The company may declare bonuses from
time to time, from the third policy year. These will be paid out to you, based on your
choice of bonus options.
Tax Benefits
The premiums paid by the individual under this plan qualify for income tax rebate under
Section 80C of the Income Tax Act(if applicable), while the payback and maturity
benefits are exempt from tax under Section 10(10D) of the Income Tax Act.
PLAN DETAILS
Minimum
Entry Age
21 years
Duration of Plan 11 years
Sum Assured
Rs.50,000

Maximum
60 years
26 years
No Limit

Freedom of Choice
You have the flexibility to choose the tenor of the plan, depending on the age of the child
and your specific need.
Follow these 2 simple steps to decide upon the tenor of your plan:

Decide the childs age at which you need the maturity benefits.

Now subtract the current age of the child from that, to reach the ideal tenor of the
plan that will ensure you receive the benefits when you need them

For Example:
Childs age at maturity benefit
Childs current age
Tenor

20
3
20-3=17

HOW DOES THE PLAN WORK?

29

The following example would help you understand how a Stepping Stones TM Plan
works. For a male, aged 35 and planning to buy a Stepping Stones TM plan with basic
sum assured of Rs.1,00,000 17 years plan tenor, the basic annual premium would be
Rs.7,450.
The various benefits under the plan are:

Survival Benefit
First money back installment at

Rs.30,000

5 years before maturity

Second money back installment Rs.30,000
At 2 years before maturity
Maturity benefit

Rs.65,000 plus sum assured of paid up additions, if any

Death Benefit
Death of life insured at any

Rs.1,00,000 plus sum assured of paid up additions, if

Time while policy is in force

any

The policy continues and all

unpaid future benefits, as
illustrated above, will remain
unaffected. Also, all future
premiums will be waived off.

30

1.3

PROBLEMS OF THE ORGANIZATION

To determine customers level of satisfaction aspire plans with the quality of their
transaction with Reliance Life Insurance.
The biggest challenge faced by the Government today is that of a regulator with the
prospect of about 30 or 40 players, each represented by thousands of agents, brokers and
intermediaries. To evolve a free and fair method of assessing the companies, to ensure
fair play between the competitors and to safeguard the interests of the largely uninformed
customers are the main tasks ahead. The other and equally serious aspect is to ensure that
the vast amounts collected by the insurance and pension funds are utilised for the welfare
of the people. Though the Government itself would not be the guarantor of the policy
monies, nevertheless, it is accountable through its regulatory mechanism, to put in place
prudential norms of investment and accounting, revenue recognition, fair valuation of
assets and liabilities, determining necessary margins towards any contingencies and
proper reserves for shrinkage of investments will have to be made. Nevertheless, care has
to be taken to see that there is not too much of control and regulation. A certain degree of
autonomy in the functioning of insurance companies has to be allowed so that they get
necessary freedom and space to perform and excel. The IRDA, along with the advisory
committee constituted recently, is eminently qualified to undertake these tasks. In
addition, a proposal has also been mooted to constitute a federation of insurance
companies analogous to the Indian Banks Association. Such an institution will provide
guiding principles, lay down a code of insurance ethics and generally act as a facilitator
for both the life and non-life industry.
As for the existing player, the public sector giant, the Life Insurance Corporation of
India, the challenge is one of sustaining the huge growths it has shown in the recent
times. It has to face competition for the first time in its history, particularly in the urban
centres. It has to manage its huge operations more efficiently than at any other time in the
past. It has to think of equipping its personnel (staff and agents) to face competitors and it
may have to think of diversifying its activities to achieve economies in some areas.

31

As far as the prospective entrants are concerned, the greatest challenge is to establish
their presence in the minds of the public. Insurance, particularly life insurance, it is said,
is never bought but sold. To convince a large population, which is comparatively not well
informed about the intangible benefits of life insurance is indeed an onerous task. On top
of that, to establish the brand equity of a new name in a new field is quite a challenge.
The second most important challenge facing a new entrant is that of setting up
infrastructure and to reach out to as many areas as possible, since life insurance is based
on probability and the wider the spread, the greater are the chances of success in
maintaining the expense ratios at a reasonable level.
Modern life perhaps offers challenges that will be common to all the above.
Improvements in health and longevity, the recent breakthroughs in the mapping of the
human genome and the frequent changes in the economy may have far-reaching effects
on life and health insurance. Devising products that match the changing needs of the
people and managing the funds in a volatile scenario are two problems that will have to
be tackled by every player in the days to come.

32

1.4

COMPETITION INFORMATION

NAME OF THE COMPANY

NO. OF BRANCHES

RELIANCE LIFE INSURANCE

60

MAX LIFE INSURANCE

105

ICICI PRU LIFE

112

OM KOTAK MAHINDRA LIFE

51

BAJAJ ALLIANZ LIFE

535

BIRLA SUN LIFE

89

HDFC STANDARD LIFE

158

LIC OF INDIA

100

ING VYSYSA LIFE

60

AVIVA INDIA

102

SBI LIFE INSURANCE

53

33

In terms of premium payment options

CREDIT BILL
COMPANIES

ECS

CARD

BILL

EASY DROP BO

JUNCTION DESK CASH/CHEQUE BILL

RELIANCE LIFE
INSURANCE
ICICI PRU LIFE
MAX NEW YORK

YES
YES

YES
YES

YES
YES

YES
YES

YES
YES

YES
YES

YES
YES

LIFE
OM KOTAK

YES

YES

YES

NO

YES

NO

YES

MAHINDRA
BAJAJ

YES

NO

NO

YES

YES

NO

YES

ALLIANCE
BIRLA SUN LIFE
HDFC

YES
YES

YES
YES

YES
NO

NO
NO

YES
YES

NO
NO

YES
YES

STANDARD LIFE
LIC OF INDIA
ING VYSYA LIFE
AVIVA LIFE INS.
SBI LIFE INS.

YES
YES
YES
YES
YES

NO
NO
NO
NO
YES

NO
YES
YES
NO
NO

NO
YES
NO
NO
NO

YES
YES
YES
YES
YES

NO
NO
NO
NO
YES

YES
NO
YES
YES
YES

34

1.5

SWOT ANALYSIS OF THE ORGANIZATION

SWOT Analysis is a technique for understanding strengths, weakness, opportunities and

threats of an organization.
The SWOT Analysis is a technique used for identifying an organizations strengths and
weakness and examining the opportunities and threats which the organization is facing.

35

Strengths

Weaknesse

s
Opportuniti threats
es
Strengths

Marketing expertise

Big distributional channel

Innovative product or services

Brand name

Very Strong Private Player in the insurance industry in India.

Life Insurance linked with Investments

Tax benefits

Security against loans

Helps in future planning and provides financial consultancy.

Covers risk.

Weaknesses

Similar products offered by the competitors

36

Undifferentiated price in comparison to the competitors

Anticipated returns are told to the customers

Less of organization culture

Negativity relating insurance and Agents.

No fixed Salary.

Opportunities

No startup capital required

Flexible working environment

Be your own boss

Unlimited earning potential

To be part of a world-class team

Threats

Price conflicts with the competitors

Product and service conflicts with competitors

Change in government policy regarding taxation

Rapid launch of more companies in the same industry

Dynamic environment

Increasing Competition

Non-creativity

An Unfocused approach

Price conflicts with the competitors

Product and service conflicts with competitors

Change in government policy regarding taxation

Rapid launch of more companies in the same industry

37

38

CHAPTER - 2

OBJECTIVE
&
METHODOLOGY

39

OBJECTIVE & METHODOLOGY

2.1

SIGNIFICANCE

To provide ongoing financial advise for his/her clients:

o Identifying future clients
o Making appointments
o Conduct financial review meetings with clients/prospects
o Close sale
o Get referrals
o Provide service to clients

Follows internal sales and reporting system

SIGNIFICANCE TO THE INDUSTRY :

This is a limited study which takes into consideration the responses of 100 people. This
data can be explorated to take in the trends across the industry. The significance for the
industry lies in studying these trends that emerge from the study. It is a rapiddly changing
and evolving sector. People are only beginning to wake up to its vast possibilities. A
study like this can attempt to guide the future of the industry based on current trends.

SIGNIFICANE FOR THE RESEARCHER :

To facilitate and provide all the useful informtaion of the studt, the company, the
insurance industry and also provide marketing ways, methods of reliance life insurance.

40

2.2

MANAGERIAL USEFULNESS OF THE STUDY

Helps to have sale experience

Helps to deal with different customers

Helps to overcome the objections of the customers

Helps to understand the problems of agents in a broader prospect

It provides a platform where managerial role can be played effectively and

efficiently

The project is based on competitive strategies of the different insurance companies . there
are many experienced and new companies in the insurance sector with their own unique
and different plans to convince the people . people preferences , their tastes directly
effects the companys performance , so in this competitive world there is a need to
undergo a proper study of the consumer tastes and preferences and also the steps taken by
various insurance companies to attract the consumers.
So, in this way this project , which is based on the marketing strategies of different
insurance companies focuses on the steps which are taken by these companies to attract
buyers. With the help of this project the company can easily modify or bring any
necessary changes in its saving bonds in order to compete in the insurance sector. This
project helps management in number of ways:
Decision making
focusing a particular group or sector
better study of the insurance sector
formation of policies

41

2.3

OBJECTIVES
The objective of the project is to know about the consumer preferences towards the

insurance and also aware the consumer about the reliance life insurance co.
Insurance should exist everywhere and should be available to anyone one who want
its protection and who wants his/her life secured, whenever, wherever on this planet.
To fulfill this goal just producing high quality product is not sufficient, an effective
distribution system holds the key to achieve a ultimate goal

Main objective of the project is to find out the strategies of different insurance agencies
and evaluate them. Project is about to penetrate the competitors of Reliance life
Insurance. Conclusion of this project can give an idea of strategies of different companies
which may be helpful to the company. Now days all the insurance companies in India are
trying to establish themselves in the competitive market. They are introducing innovative
marketing strategies to survive in the market. Many other private companies are looking
to enter in the Indian insurance market .so it is very essential to a company to innovate
their marketing strategies in terms of Find out the marketing strategies of different
insurance companies which are the competitors of Reliance Life insurance.

42

2.4 SCOPE OF THE STUDY

1) To study the present consumer buying behavior towards insurance policies
process in the organization at various levels,
2) To find the awareness level of employees vis--vis consumer buying behavior
towards insurance policy and
3) To compare the companys consumer buying behavior towards insurance
policy with the best HR practices in consumer buying behavior process.
A big boom has been witnessed in Insurance Industry in recent times. A large
number of new players have entered the market and are vying to gain market share
in this rapidly improving market. The study deals with Reliance in focus and the
various segments that it caters to. The study then goes on to evaluate and analyse
the findings so as to present a clear picture of trends in the Insurance sector

43

2.5 METHODOLOGY
In order to make this project effective and to show the real picture of the status and the
reach of those life insurance companies, I have undertaken the following steps: 1. I first searched the premium payment options of Reliance Life Insurance and then

understood them through their website.

2. Then I collected and chose the names of 9 of the most satisfactory life insurance

companies
3. After that I searched for the modes for collecting the information regarding the

premium payment channels of other insurance companies like through logging on

to their websites, through phone enquiry or by visiting their branch office.
4. I opted all of the three modes for the completion of this project.
5. Then I started off one by one with all the selected life insurance companies.
6. I also collected information regarding the untouched places or the places where

Reliance Life Insruance has its branch offices yet.

7. Also I swapped all those premium payment options that Reliance Life Insurance

offer but which are available with other life insurance companies and elaborated
them.
8. At last after collecting all the essential data, I omitted the incomplete /

unnecessary data and then made a comparison between Reliance Life Insurance
Company. And all the other chosen life insurance companies along with it
elaborating about the 9 companies.

44

DATA SOURCE
POPULATION:In statistics, a statistical population is a set of entities concerning which statistical
inferences are to be drawn, often based on a random sample taken from the population.
For example, if we were interested in generalizations about crows, then we would
describe the set of crows that is of interest. Notice that if we choose a population like all
crows, we will be limited to observing crows that exist now or will exist in the future.
Sample Size:-

The number of population items selected when a sample is drawn from a population. For
causal-comparative, correlation research 30 in each group, and 15 in experimental
research are generally recommended as minimum sample size.

TYPES OF DATA USED:Primary Data:It is collected directly from people and organization via questionnaires or surveys before
being analyzed to reach conclusions concerning the issues covered in the questionnaire or
survey.

Various Sources

QUESTIONNAIRE

PRODUCT PAMPHLET

PERSONAL OBSERVATION

Secondary Data:Secondary data - collected by are others to be "re-used" by the researcher.

45

Various Sources

NEWSPAPERS

INTERNET

PROSPECTOUS

Ways of Using Secondary Sources

o Exploratory phase - getting ideas
o Design Phase - definitions & sampling frames, question wording
o Supplement to Main Research
o Re-Enforcement &/Or Comparison
o Main Mode of Research
o Direct Data Collection Impossible
o Or Costly & Time Consuming
How to Search & Use Secondary Sources?
o Documents - Bibliographic Skills, Use of Keywords, Boolean
Operators
o Published Statistics

Guide to Official Statistics

Digests & Abstracts

Primary Publication

Limitations
1. The sample size was very small.
2. There is bias on the part of the respondents.
3. There is lack of information as everyone is not ready to share their
personal matters with everybody. Some people resist the answers.
4. It is impossible to cater every class of the society.
46

CHAPTER-3
CONCEPTUAL DISCUSSION

47

CONCEPTUAL DISCUSSION
What is Life Insurance
Life insurance is a guarantee that your family will receive financial support, even in your
absence. Put simply, life insurance provides your family with a sum of money should
something happen to you. It thus permanently protects your family from financial crises.
In addition to serving as a protective cover, life insurance acts as a flexible money-saving
scheme, which empowers you to accumulate wealth-to buy a new car, get your children
married and even retire comfortably.
Life insurance also triples up as an ideal tax-saving scheme. To know more, read the Key
Benefits of Life Insurance.

Key Benefits of Life Insurance

Life insurance, especially tailored to meet financial needs.

Need for Life Insurance

Today, there is no shortage of investment options for a person to choose from. Modern
day investments include gold, property, fixed income instruments, mutual funds and of
course, life insurance. Given the plethora of choices, it becomes imperative to make the
right choice when investing your hard-earned money.
Life insurance is a unique investment that helps you to meet your dual needs - saving for
life's important goals, and protecting your assets
Let us look at these unique benefits of life insurance in detail.
Asset Protection
From an investor's point of view, an investment can play two roles - asset appreciation or

48

asset protection. While most financial instruments have the underlying benefit of asset
appreciation, life insurance is unique in that it gives the customer the reassurance of asset
protection, along with a strong element of asset appreciation.
The core benefit of life insurance is that the financial interests of ones family remain
protected from circumstances such as loss of income due to critical illness or death of the
policyholder. Simultaneously, insurance products also have a strong inbuilt wealth
creation proposition. The customer therefore benefits on two counts and life insurance
occupies a unique space in the landscape of investment options available to a customer.
Goal based savings
Each of us has some goals in life for which we need to save. For a young, newly married
couple, it could be buying a house. Once, they decide to start a family, the goal changes
to planning for the education or marriage of their children. As one grows older, planning
for one's retirement will begin to take precedence.
Clearly, as your life stage and therefore your financial goals change, the instrument in
which you invest should offer corresponding benefits pertinent to the new life stage.
Life insurance is the only investment option that offers specific products tailormade for
different life stages. It thus ensures that the benefits offered to the customer reflect the
needs of the customer at that particular life stage, and hence ensures that the financial
goals of that life stage are met.
The table below gives a general guide to the plans that are appropriate for different life
stages.

Life Stage

Primary Need

Life Insurance Product

Young & Single

Asset creation

Wealth creation plans

Young & Just married

Asset creation & protection

Wealth creation and mortgage

protection plans

49

Married with kids

Children's education, Asset

Education insurance, mortgage

creation and protection

protection & wealth creation

Middle aged with grown up

Planning for retirement & asset

plans
Retirement solutions &

kids
Across all life-stages

protection
Health plans

mortgage protection
Health Insurance

Human Life Value

What is your Human Life Value?
Beyond all doubt, your life is invaluable. Yet, there is a certain worth that can be
attributed to the financial support you offer your parents, spouse or children. This worth
is referred to as Human Life Value (HLV). In the future, if your family does not have the
protective blanket of your presence, they will no longer be able to enjoy the benefits of
the income you earned. Put simply, Human Life Value is the present value of your future
earnings.
Why should you calculate your Human Life Value?
You should calculate your Human Life Value so you can accordingly invest in insurance
plans that provide your family with adequate finances and hence security even in your
absence.
How do you determine your Human Life Value?
Your Human Life Value is determined by 3 factors:
1. your age
2. Current and future expenses
3. Current and future income

50

As a thumb rule, if you are 30 years of age, you should insure yourself for an amount
approximately 8 times your annual income. At 35, your investment should be close to 6
times your income. Of course, the exact amount of your investment should be determined
by the number of people who depend on you, your existing investments and your life
stage. For example, if you are 30 years of age and have two children and parents to
provide for, the amount you invest should be reflective of your requirements.

Life Stage Profiler

All through your life, several significant events the birth of your child, moving to a larger
home, his or her education and wedding, buying a new car, retiring from work will occur
at various stages and demand your financial commitment. If you plan in advance for
these events, you will quite naturally be prepared when they occur.
Life insurance is an effective tool that assists you to plan for your future such that you are
financially equipped to meet all your goals.
Our special tool, the Life Stage Profiler, assists you to plan for a secure financial future.
Please use the tool, right away!
Which important goals should you plan for in advance?
1) Your family's protection - so that your loved ones are secure should an unfortunate
event happen to you. Life insurance can guarantee that your family receives a lump sum
that safely tides them over any financial crises that might occur in your absence.
2) Child's education: As parent, your primary responsibility is to guarantee your
children's future. Our Education Insurance plans ensure your child receives money at key
stages of his or her education even in your absence.
3) Savings: Savings plans allow you to steadily save towards a pre-decided goal in a
secure manner. These plans provide you with a host of benefits. You can choose the

51

premium, the underlying fund in which you want to invest your money, the ratio between
protection and investment as per your requirements.
4) Retirement: Retirement plans help you secure guaranteed income for your retired life.
During the Accumulation phase, you systematically save while you are working. When
you retire, the Payout stage of the plan begins. You then purchase an annuity, which will
serve as a steady stream of income, for the rest of your life.
5) Health: An integral part for financial planning is protecting oneself against any
medical emergencies as well. Hence, a very prudent decision would be to choose a
combination of plans that look after your finances and offer you a protective health cover
to ensure your financial planning is in track despite any major illnesses.

52

TYPES OF INSURANCE
1) HEALTH INSURANCE
Don't go without this. Most people have it at work, but if you don't you will really save
big by going for a group policy. When comparing policies, consider deductibles and what
is or isn't covered. When given a choice, choose one that covers the huge, debilitating
conditions over one that is good about routine immunization, but that balks at the larger,
more expensive claims.

Health insurance comes in three types

Fee for service, the most expensive, allows you to go to almost any provider and
covers almost anything that is medically necessary. You don't have a primary care
physician who has to approve visits to specialists.

P r e f e r r e d p r o v i d e r o p t i o n s (PPO's) allow you to self-refer to any provider

in the PPO's list and generally cover a wide variety of services recommenced by
those providers. Some PPO's cover other providers, but with a larger co-payment.

Health maintenance organizations (HMO's) are the least costly, but the most
restrictive. They assign you (or let you select) a primary care physician. That
physician acts as a gatekeeper in that (s)he decides what is medically necessary
and when you may see a specialist. Often the HMO itself has to permit certain
treatment and can rule against your doctor

2 LIFE INSURANCE
For most people, the purpose of life insurance should be to replace the financial
contribution made by a family member.

53

Life insurance can be pure insurance, which pays only on the death of the insured, or cash
value insurance, which also has a savings vehicle. Most people who need life insurance
are better off with pure insurance and saving for retirement through other vehicles.
Proceeds from life insurance cover three types of expenses: replacement of the
policyholder's income or work, estate taxes, and burial costs. When you consider the
amount of insurance to buy, consider the following:
1. Most of the life insurance should be on a family member whose salary is important to
the family budget.
2. Consider a relatively small life insurance policy on a stay-at-home parent to cover
child care and other expenses.
3. Don't buy life insurance on children. Instead, buy life insurance on other family
members for the benefit of children.
4. Consider reducing the amount of life insurance you have as you build more financial
assets.
5. Pass on credit life insurance and mortgage life insurance if you can. These plans are
restrictive and expensive. Buy more general life insurance instead if you feel a need.
6. Pass on life insurance altogether if you are single and don't have anyone depending on
you. At most, get a small policy to spare your family burial expenses.

3 AUTO INSURANCE
In most states you are required to have auto insurance and you don't want to be without it.
Basically, you buy auto insurance for two purposes: to insure against liability you have to
others and to insure against damage that others do to you or your car.
You need to have liability insurance. How much you need depends on how much you
have in assets.
54

Whether you need insurance to protect your own car depends on your car and how
detesting it would be to replace it.
If your car is expensive and if buying another one would wipe you out financially,
consider buying comprehensive and collision. If you have an older car and wouldn't get
much from the insurance company if it were totaled, don't bother. Instead, put the money
you would have paid for comprehensive and collision toward saving for your next car.

4 HOMEOWNERS' INSURANCE
The purpose of homeowners' insurance is to protect you against damage to your home
and property from natural disasters.
Insurance companies offer different ratings of insurance and assign these ratings with
codes starting with the letters "HO". While these ratings are fairly standard, they do vary
a little with companies, so check with the company to see what policies cover.
When comparing policies, consider differences among deductible, coverage of property
other than the house (sheds, garages, etc.), and percent of loss covered. Consider also
whether the policy covers resale cost or rebuilding cost. Rebuilding usually provides
better coverage, but is more expensive.
Basic homeowner's insurance does not cover the contents, though you can often add it for
an additional fee or buy it separately. When buying contents insurance, consider whether
it covers replacement value or fair market value. Replacement value is a better buy
because it pays to buy a new piece of furniture or appliance, not what your old one is
worth.
Consider also buying liability insurance which covers you if someone sustains an injury
or other loss on your property.

55

INSURANCE PLAYERS

THERE ARE FIFTEEN PLAYERS IN INDIA OR WE CAN SAY FIFTEEN

INSURANCE COMPANIES WHICH PROVIDING A INSURANCE AND
THEY ARE DEALING WITH INDIA

1) LIFE INSURANCE
2) RELIANC LIFE INSURANCE
3) HDFC INSURANCE
4) ICICI PRUDENTIAL
5) RELIANCE
6) BAJAJ ALLIANCE
7) AVIVA
8) BIRLA SUNLIFE
9) ING VYSA
10) BHARTIA AXA LIFE INSURANCE
11) KOTAk MAHINDRA
12) TATA AIG LIFE INSURANCE
13) MET LIFE
14) SBI INSURANCE
15) ROYAL SUNDURAM

56

INSURANCE REGULATORY AND

DEVELOPMENT AUTHORITY
MISSION
To protect the interests of the policyholders, to regulate, promote and ensure orderly growth of the
insurance industry and for matters connected therewith or incidental thereto.

About IRDA
Composition of Authority under IRDA Act, 1999
As per the section 4 of IRDA Act' 1999, Insurance Regulatory and Development Authority (IRDA, which
was constituted by an act of parliament)
specify the composition of Authority
The Authority is a ten member team consisting of
(a) a Chairman;
(b)

five whole-time members;

(c)

four part-time members,

(all appointed by the Government of India)

57

Duties, Powers and Functions of IRDA

Section 14 of IRDA Act, 1999 lays down the duties, powers and functions of IRDA..
(1) Subject to the provisions of this Act and any other aw for the time being in force,
the Authority shall have the duty to regulate, promote and ensure orderly growth
of the insurance business and re-insurance business.
(2) Without prejudice to the generality of the provisions contained in sub-section
(1), the powers and functions of the Authority shall include, (a) issue to the applicant a certificate of registration, renew, modify, withdraw,
suspend or cancel such registration;
(b) protection of the interests of the policy holders in matters concerning assigning
of policy, nomination by policy holders, insurable interest, settlement of insurance
claim, surrender value of policy and other terms and conditions of contracts of
insurance;
(c) specifying requisite qualifications, code of conduct and practical training for
intermediary or insurance intermediaries and agents;
(d) specifying the code of conduct for surveyors and loss assessors;
(e) promoting efficiency in the conduct of insurance business;
(f) promoting and regulating professional organisations connected with the
insurance and re-insurance business;
(g) levying fees and other charges for carrying out the purposes of this Act;
(h) calling for information from, undertaking inspection of, conducting enquiries
58

and investigations including audit of the insurers, intermediaries, insurance

intermediaries and other organisations connected with the insurance business;
(i) control and regulation of the rates, advantages, terms and conditions that may be
offered by insurers in respect of general insurance business not so controlled and
regulated by the Tariff Advisory Committee under section 64U of the Insurance Act,
1938 (4 of 1938);
(j) specifying the form and manner in which books of account shall be maintained
and statement of accounts shall be rendered by insurers and other insurance
intermediaries;
(k) regulating investment of funds by insurance companies;
(l) regulating maintenance of margin of solvency;
(m) adjudication of disputes between insurers and intermediaries or insurance
intermediaries;
(n) supervising the functioning of the Tariff Advisory Committee;
(o) specifying the percentage of premium income of the insurer to finance schemes
for promoting and regulating professional organisations referred to in clause (f);
(p) specifying the percentage of life insurance business and general insurance
business to undertaken by the insurer in the rural or social sector

59

CHAPTER-4
DATA ANALYSIS

60

DATA ANALYSIS
Q1. Do you think investment planning is important for your
health?

Service class
Business class

Yes
80%
12%

No
20%
88%

After analyzing the data it was found that 80% of the service class just 12% of
business class were interested in going for investment planning.
Service class had to save their tax and simultaneously they realize the need of
investment of future.
Business class had an attitude of thinking about the things when incidents will be
on head.

61

Q2. What is the pattern of investment?

fixed
Social Class
Business class

property
2%
55%

shares
3%
45%

insurance
62%
5%

deposit
5%
3%

others
28%
12%

After analyzing the data, it was found that, just 2% of social class has invested in property,
3% in shares, 62% in insurance, 5% in fixed deposit, 28% in others.
In business class, 55% invested in property, 45% in shares, 5% insurance, 3% in fixed
deposit, and 12%in others.

62

Q3. What is the insurance objective?

long-term

retirement

children savings

short-term objective

objective

objective

objective

class
business

45%

5%

25%

25%

class

85%

5%

5%

5%

service

After analyzing the data it was found that 45% of service class wanted to go for short-term
objective, 5% for long-term objective, 25% for retirement-objective, and 25% for children
saving objective.
In business class, 85% wanted to go for short-term objective, just 5% for long-term objective,
retirement objective and children saving objective.

63

Q4. Which industry do you prefer to invest the most?

insurance bank

shares

others

class
business

62%

20%

3%

15%

class

5%

3%

45%

47%

service

After analyzing the data it was found that in social class, 62% people want to invest for
insurance, 20% for bank, 3% for shares, and just 15% for other things.
In business class, 5% for insurance, 3% for bank, 45% for shares, and 47% for others

64

Q5. Have you done life insurance planning?

yes

no

class
business

75%

25%

class

15%

85%

service

After analyzing the data it was found that, in social class, 65% have done life insurance
planning, and 25% have not done it.
In business class, 15 have done life insurance planning and 75% havent done.

65

Q6. What is the insurance cover you possess?

1 lakh

5 lakh

10 lakh

1 crore

class
business

65%

20%

15%

class

75%

15%

20%

service

After analyzing the data, it was found that, 65% of social class possess in 1 lack plan, 20% in
5 lack plan, and 15% in 10 lack plan.
In business class, 75% possess in 1 lack plan, 15% in 5 lack plan, and20% in 10 lack plan.

66

Q7. According to you what are the basis you taking life insurance?

service class
business class

long premium
25%
55%

reputation of the
company
25%
5%

larger risk cover

35%

money back
guarantee
25%
5%

After analyzing the data, it was found that, 25% of social class wants to invest for high
premium, larger risk cover, reputation of the country, money back guarantee. In business
class, 55%, and 35% want to go for high premium and larger risk cover and only 5% want to
for money back guarantee plan.

67

Q8. According to you in which company you will do insurance or

investment?
service class
business
class

LIC
19%

RELIANCE
30%

ICICI
45%

OTHERS
6%

45%

14%

35%

6%

After analyzing the data, it was found that, in social class, 19% want to go for LIC, 30% in
RELIANCE, 45% in ICICI, and 9% in others.
In social class, 45%, 14%, 35%, and 6% want to invest in LIC, RELIANCE, ICICI,
OTHERS, respectively.

68

Q9. How do you rate your investment profile?

service class
business
class

conservative
5%

aggressive
55%

secured
5%

balanced
35%

80%

20%

After analyzing the data, it was found that, in social class, 5% want to invest conservative
and secured fund, 55% want to invest in aggressive fund, and 35% in the balance fund.
In business class, 80% of the population wants to go for aggressive fund, and 20% of
population wants to go for the balance fund.

69

Q10. How have you planned to arrange the fund in case of

emergency?
saving
critical
illness
social class
20%
business class -

accident
20%
-

pre-matured

from

life medical

Relatives /

death
20%
-

bank
20%
-

insurance
20%
-

friends
5%

After analyzing the data, it was found that in social class, 20% have arranged for critical
illness, accident, pre-matured death, savings from bank, and for life medical insurance.
In business class, 5% want to invest in relative/friends plan and 95% for others.

70

others
95%

CHAPTER-5

FINDINGS
&
RECOMMENDATION

71

FINDINGS
It is very imperative to ascertain the needs, priority and actual worth of a client before
providing any insurance plan or investment plan. And sometimes the need for buying life
insurance has to be arisen. It can be seen as follows:
5 reasons why health covers are a must
A health cover insures you against several illnesses and guarantees you stay financially
secure should you ever require treatment. The cover ensures you are taken care of by
compassionate and competent doctors at the best hospitals. It thus safeguards your peace of
mind, eliminates all worries about treatment expenses, and allows you to focus your energy
on more important things, like healing.
Indians at greater risk
Reason 1: Lifestyles have changed: Indians today suffer from high levels of stress. Long
hours at work, little exercise, disregard for a healthy balanced diet and a consequent
dependence on junk food have weakened our immune systems and put us at an increased risk
of contracting illnesses.
Reason 2: Rare non-communicable diseases now common: Obesity, high blood pressure,
strokes, and heart attacks, which were earlier considered rare, now affect an increasing
number of urban Indians-almost every day.
Shocking Truths
18% of the urban population suffers from hypertension, which leads to renal failure, stroke
and cardio vascular diseases
30% of the population suffers heart attacks before age 40

72

66% of deaths today are due to cardio vascular diseases

Almost 3.5 million Indians suffer from diabetes
Cardiovascular diseases (CVDs) like heart disease and stroke are the main causes of death
and disability
The Cost Factor
Reason 3: Medical care is unbelievably expensive: Medical breakthroughs have resulted in
cures for dreaded diseases. These cures, however, are available only to a select few. High
operating expensestherapy for breast cancer costs as much as Rs. 2 lakhs for 3 dayshave
restricted treatment to the richest. In fact, even among the affluent groups, 20% need to sell
their valuable assets so they can accumulate the required amount for their medication.
Reason 4: Indirect costs add to the financial burden: Indirect sources of expensetravel,
boarding and lodging, and even temporary loss of incomeaccount for as much as 35% of
the overall cost of treatment. Most often, we overlook this fact when planning for medical
expenses.

Reason 5: Incomplete financial planning: Most of us have insured our home, vehicle,
childs education, and even our retirement years. Ironically however, we have not insured our

73

health. We ignore the fact that illnesses strike without warningand seriously impact our
finances and eat into our savings in the absence of a good health cover.
Health cover: A must-have
No financial plan is complete without a comprehensive health cover. ICICI Prudential offers
3 critical illness covers: Health Assure, Health Assure Plus and Cancer Care. Each of these
plans provides you with guaranteed sums should you ever be diagnosed with a critical illness.
The benefit amount takes care of all your treatment costs and ensures your hard-earned
savings stay intact.
Need can be arise by doing the life line as I did with my customers to ascertain their needs
and their worth. They have to be made understood whether they are adequately insured.

Are you adequately insured?

Sound health cover planning ensures you receive both, direct medical expenses and indirect
expenses, as soon as the need arises. When investing, choose a range of health plans that:
Cover a wide spectrum of medical conditions from the most basic to the most critical.
Include reimbursement and benefit-based plans, which enable you to meet specific health
risks and expenses as mentioned in the diagram below

74

An example: Canceralthough it does not occur as frequently as the common cold or fever
severely drains ones finances as its treatment expenses are very high. Hence, it is imperative to
insure ourselves with a health plan that provides cover against Cancer.

Quick tip:
while selecting a health plan, ensure the plan:

Provides long-term coverage

Clearly mentions exclusions of cover

Is guaranteed renewable

Is backed by trusted name and gives the assurance of paying claims.

Personalized service which I have provided to the customer:

Handling telephonic queries.
Meeting new prospects to understand their requirement and offering them best product in the
market.
Insuring that all customer enquiries are dealt effectively and updating customer data base.
Maintaining regular contact with clients to generate references.
Responsible for providing regular and consistent service to the customers.
CONCLUSION
Insurance is a social device in which a group of individuals (insured) transfer the risk to
another party (insurer) in order to combine the loss experience, which permits statistical
prediction of the losses and provides from payment of losses from the funds contributed
(premiums) by all the members who transferred risk.
Reliance Life Insurance Co. Ltd. is a very upcoming insurance company. This company is
expanding its customer base at a very high speed and also with satisfaction of the customers.
Reliance Lifes customers are happy and this company does not force the customer to take up

75

the policy but it steps into the shoes of the clients and help them in each and every possible
way.
I would like to conclude both the positive as well as the negative aspects of this study:Positive Aspect is as follows:
RELIANCE Life INSURANCE COMPANY is at the apex as it provides the maximum
number of premium payment options to its customers and has maintained the healthiest
customer satisfaction level in comparison of other life insurance companies. Also, it stands at
fourth position for having 105 branch offices all over India. Some life insurance companies
qualifies with RELIANCE Life for providing online premium payment service, they are
ICICI PRUDENTIAL LIFE, OM KOTAK MAHINDRA LIFE, BAJAJ ALLIANZ LIFE, LIC
OF INDIA and ING VYSYA. Also, this co. is at the rapid increasing rate in terms of number
of applications qualified.
Negative Aspect is as follows:
In comparison of all these life insurance companies, BAJAJ ALLIANZ LIFE INSURANCE
COMPANY stands 1st for having the most number of branch offices all over India(535
branches). Also, RELIANCE Life doesnt provide various premium payment options like
ATM, KIOSKS, COURIERS/POSTAGE & STANDINGINSTRUCTIONS MANDATE as
offered by other insurance companies. The area of operations of RELIANCE Life is limited,
it have to enlarge its network as it have not reached most of the rural areas where there is a
desperate need of providing insurance policies. Also, the company do not do mass
advertisement, like other insurance companies do, which is the most basic technique of sales
promotion.

76

RECOMMENDATION

Better organizational culture should be established by recruiting qualified managers.

There should be professional attitude amongst agent and advisors as well.
More and more branches should be opened.
Advertisements should be on mass basis.

77

ANNEXURE

78

Questionnaire
Q1. Do you think investment planning is important for your health?

Yes

No

Q2. What is the pattern of investment?

Property

Shares

Insurance

Fixed deposit

Others

Q3. What is the insurance objective?

Short-term objective

Long-term objective

Retirement objective

Child objective

Q4. Which industry do you prefer to invest the most?

Insurance

Bank

Shares

Others

Q5. Have you done life insurance planning?

Yes

No

Q6. What is the insurance cover you possess?

79

Rs.1, 00,000

Rs.5,00,000

Rs.10,00,000

Rs.1,00,00,000

Q7. According to you what are the basis you taking life insurance?
Long premium
Larger risk cover
Reputation of the company
Money back guarantee

Q8. According to you in which company you will do insurance or investment?

LIC
Reliance
ICICI
Others
Q9. How do you rate your investment profile?

Conservative

Aggressive

Secured

Balanced

80

Q10. Have you planned to arrange the fund in case of emergency?

Critical illness

Accident

Pre-matured death in your family

Saving from the bank

Life medical insurance

Relatives/friends

Others

81

BALANCE SHEET
Holdings

Weightage
(%)
Equities
91.54
Reliance Industries Ltd
6.44
Divis Laboratories Ltd
6.31
State Bank of India
6.27
Reliance Communications Ltd
6.23
Larsen & Toubro Ltd
5.05
Grasim Industries Ltd
4.82
Infosys Technologies Ltd
4.79
Maruti Suzuki India Ltd
4.76
ICICI Bank Ltd
4.39
Tata Steel Ltd
4.03
Tata Motors Ltd
3.62
Reliance Energy Ltd
3.60
Siemens Ltd
2.99
Alstom Projects India Ltd
2.91
Television Eighteen India Ltd
2.61
Deccan Aviation Ltd
2.61
Indian Hotels Co Ltd
2.49
Hindalco Industries Ltd
2.35
Gammon India Ltd
1.98
Tata Consultancy Services Ltd
1.87
Infrastructure Development Finance Company 1.72
Ltd
Bharat Forge Ltd
1.63
Triveni Engeering And Industries Ltd
1.54
Patni Computers System Ltd
1.39
Automotive Axles Ltd
1.29
Indiabulls Securities Ltd
1.04
Ultratech Cement Ltd
1.03
Equity Less Than 1% of Corpus
1.80
Preference Shares, Debt, Derivatives,
8.46
Cash and Other Receivables
Grand Total
100.00

82

SECTOR ALLOCATION
Industry
Banks
Auto
Software
Petroleum Products
Pharmaceuticals
Telecom - Services
Industrial Capital Goods
Cement
Diversified
Ferrous Metals
Power
Finance
Hotels
Media & Entertainment
Transportation
Non - Ferrous Metals
Construction
Industrial Products
Consumer Non Durables
Auto Ancillaries
Miscellaneous
Grand Total

%Allocation
10.66
8.44
8.04
6.44
6.31
6.23
5.90
5.85
5.05
4.03
3.98
2.88
2.68
2.61
2.61
2.35
1.98
1.63
1.54
1.29
1.04
91.54

83

FINANCIAL PLAN
Life insurance is also now being regarded as a versatile financial planning tool. Apart from
the traditional term and saving insurance policies, industry has seen the entry and growth of
unit linked products. This provides market linked returns and is among the most flexible
policies available today for investment. Now products are priced, flexible, and realistic and
sustain so people in better position to understand the risk and benefits of the product and they
are accepting these innovative products.
So it is clear that the face of life insurance in India is changing, but with the changes come a
host of challenges and it is only the credible players with a long term vision and a robust
business strategy that will survive. Whatever the developments, the future and the
opportunities in this industry will surely be exciting.
There are 12 private players in Indian life insurance market.
6 bank owned insurers: - HDFC standard life, ICICI prudential, ING Vysya, MetLife, OM
Kotak, SBI life.
6 independent insurers: - Reliance Life Insurance, Aviva, ANP sanmar, Birla sun life,
Bajaj Allianz, Max New York life, Tata AIG.

84

BIBLIOGRAPHY

85

Books:

1. Insurance and Risk Management

-Dr. P.K. Gupta
2. Risk Management and insurance
-Harrington
3. Research Methodology
-

S.C. Kothari

Websites:

www.reliancelife.co.in

www.reliancegeneral.com

www.reliancecapital.com

www.reliancemutualfunds.com

www.iciciprulife.com

www.google.com

www.bajajallianze.com

www.yahoo.com

86