On Under Submitted To Master of Finance and Control Department of Applied Economics and Commerce Patna University, Patna Under the supervision of: Submitted by: Dr. Md. AalamgirAbha Kumari Senior Lecturer Roll No - 31 M.F.C. Programme M.F.C.-II Department Of Applied Session - 2009-11 Economics & Commerce Page | 1
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8/8/2019 Abha Project
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On
Under
Submitted To
Master of Finance and
Control
Department of Applied Economics and
Commerce
Patna University, Patna
Under the supervision of: Submitted
by:
Dr. Md. Aalamgir Abha Kumari
Senior Lecturer Roll No - 31
M.F.C. Programme M.F.C.-II
Department Of Applied Session - 2009-11
Economics & Commerce
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Patna University, Patna.
Preface
Summer projects during the break in studies after the completion
of the 1st year in postgraduate courses in management, are a
regular feature in the curriculum of MASTER OF FINANCE AND
CONTROL, DEPARTMENTOF APPLIED ECONOMICS AND COMMERCE,
PATNA UNIVERSITY, PATNA.
These summer impart training to the students through the
assignment of an on line project, which they have to complete for
the organization, while staying with them the whole period of
work.
The projects not only give a chance to the students to apply
whatever knowledge they have gained over in the 1st year in a
practical way, but they also help them a practical experience of
life as a manager in a real work setting. These projects help the
students to practically apply the concepts of management, like
planning, organizing etc., in a real work setting as well. These
projects are also the means of initiating the students to the
discipline of corporate life.
Overall the summer projects are an effective learning experience
for the management students and are very helpful for them in
their later lives as management professionals.
In my case the summer project at Reliance, has provided me with
an excellent opportunity to learn under some of the top
professionals in the field of finance. The project has also provided
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me with an opportunity to interact with the various persons
related with the field of insurance.
Acknowledgement
I would like to thank my project guide Mr. Aditya Kumar Singh, TerritoryManager RELIANCE Life Insurance, Patna for guiding me through my summer
internship and research project. His encouragement, time and effort are greatly
appreciated.
I would like to thank Lect. Dr. Md. Aalamgir , for supporting me during this
project and providing me an opportunity to learn outside the class room. It was a
truly wonderful learning experience.
I would like to dedicate this project to my parents. Without their help and
constant support this project would not have been possible.
Lastly I would like to thank all the respondents who offered their opinions and
suggestions through the survey that was conducted by me in Patna.
Once again my gratitude to the RELIANCE Life insurance. For their kind co-
operation.
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Declaration
I Abha Kumari, student of MFC (part - II) of “Department of Applied
Economics & Commerce, Patna University” hereby declare that the
summer training report entitled “Effect of Reforms on Insurance
Sector” in Reliance Life Insurance is an original work and the same has
not been submitted to any other institute for the award of any otherdegree.
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Signature of candidate
(ABHA KUMARI)
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E xecutive Summary
In today’s corporate and competitive world, I find that insurance
sector has the maximum growth and potential as compared to the
other sectors. Insurance has the maximum growth rate of 70-80%
while as FMCG sector has maximum 12-15% of growth rate. This
growth potential attracts me to enter in this sector and LIFE
INSURANCE POLICY has given me the opportunity to work and get
experience in highly competitive and enhancing sector.
The success story of good market share of different market
organizations depends upon the availability of the product and
services near to the customer, which can be distributed through a
distribution channel. In insurance sector, distribution channel
includes only agents or agency holders of the company. If a
company like LIFE INSURANCE POLICY has adequate agents in the
market they can capture big market as compared to the other
companies.
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CHAPTERCHAPTER -I -I
Introduction
Industry Reforms
Industry Reforms• Industry Reform was initiated with the passage of IRDA Bill in Parliament in
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December 1999
• IRDA has stuck to its schedule of framing regulations & registering the privateinsurance companies
• As an independent statutory body of IRDA, it put in a framework of globallycompatible regulation
•Provided supporting systems and IRDA online service for issue & renewal of agents’ licenses
• Approval ensured that companies would have a trained workforce of agents tosell their products.
Present Scenario - Life Insurance Industry in India
Life Insurance in India
• The Industry grew by impressive 47.38% with premium income at Rs. 1560.41bn during 2006-2007
• Total volume of LIC’s business increased but its market share came down from
85.75% to 81.91%• The 17 private insurers increased their market share from about 15% to 19% in a
year’s time
• The share of LIC further came down to 75%, while the private players havegrabbed over 24%
• With opening of the Insurance industry in India, many foreign players haveentered the market
• The foreign companies are restricted not to have more than a 26% stake in acompany’s ownership
• Foreign funds (Rs. 8.7 bn) poured into Indian market & 19 private players havebeen granted licenses
• Innovative products, smart marketing & aggressive distribution enabled privateto sign up Indians
• Now it was a step to snap up the new innovative products on offer than only atax saving device
• It includes plans (investment with insurance & good returns (unit linked plans),multi-purpose insurance plans, pension plans, child plans and money back plans
Objectives of Study
Objectives
• Proper understanding & analysis of life insurance industries
• To know about brand awareness of Reliance Life Insurance and customers’preference
• To know about how much potential of insurance market in our city by marketsurvey
• Make a report on research on base of analysis of result obtained
• Training aims at recruiting maximum Life advisors to sell the maximum policiesfor company benefit
• To observe different products launch by other competitors: ICICI Prudential,Bajaj Alliance, LIC etc
• To understand the overall working of the Life Insurance Sector
• To find the right candidate
• To know about their family background, occupation, social relation, qualification,age
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Objectives
Primary Objectives
•
To determine reasons behind opting for an insurance• To provide the company with information of customer’s insurance policy &
reason for opting that
• To know the most preferred policy
Secondary Objectives
• To determine customer’s perception & related expectation towardsprivate insurance companies
• To determine the feedback on services provided by any other insuranceagent(s)
• To study the types of benefits provided by insurance services
• To determine the use of Internet for valuable information and decision-making process
Hypothesis
Hypothesis
• The liberalization of the Indian insurance sector has been heated subject of debatefor some years
• Competition, development & growth are essential for channeling investment toinfrastructure sector
• A cautious approach needed for foreign participation to stop seep out of substantialpremium
• IRDA saw that maturing polity emerging consensus among factions of differentpolitical parties
• IRDA allowed private entry into insurance with some changes & restrictive clauses
• Market expansion presents multitude of challenges & opportunities for old/new,public/private insurer
• Key issues, possible trends, opportunities & challenges were under the realm of possibilities & speculation
Methodology
Scope• Big boom has witnessed due to enterance of large number of new players into
Insurance industry
• The study deals with Reliance in focus & the various segments that it caters to
• To evaluate & analyse the findings so as to present a clear picture of trends ininsurance sector
Significance (to Industry)
• Limited study takes into consideration the responses of 100 people
• Data can be explorate to take in the trends across the industry
• Industry’s significance lies in studying these trends that emerge from study
• Being a rapidly changing & evolving sector, people are begining to wake up toits vast possibilities
• This study can attemp to guide the future of industry based on current trends
• 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 an Rs 60,000 crore colossus—an
achievement which earned Reliance a place on the global Fortune 500 list, the firstever Indian private company to do so.
• Dhirubhai is widely regarded as the father of India’s capital markets. In 1977, when
Reliance Textile Industries Limited first went public, the Indian stock market was a
place patronized 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-earnedmoney 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 Dhirubhai’s extraordinary vision and leadership, Reliance scripted one of
the greatest growth stories in corporate history anywhere in the world, and went on
to become India’s largest private sector enterprise.
• Throughout 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 world’s
largest shareholder families.
About Reliance
Reliance Life Insurance Company Limited is a part of Reliance Capital
Ltd. of the Reliance - Anil Dhirubhai Ambani Group. Reliance Capital is one of
India’s 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