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Advisors Potential About Insurance

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    A

    Project Study Report

    On

    Training Undertaken at

    Study of AdvisorsPerception towards LifeInsurance Market in Kota

    Submitted in partial fulfillment for theAward of degree of

    Master of Business Administration

    From University of Kota, Kota (RAJ.)

    Academic Session 2008-2010

    Submitted By: - Submitted To:-Sunil Kumar Jain Amit Sharma

    MBA Part III TertiaryManager

    MODI INSTITUTE OF MANAGEMENT & TECHNOLOGY, KOTA

    (Approved By AICTE, New Delhi & Affiliated to Rajasthan Technical

    University, Kota)

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    Modi Education Complex, Dadabari, Kota 324009

    Tel No. : 91-744-2504169, 2505421, Fax: 91-744-2391072

    Success comes with knowledge & knowledge is comes with training.

    To excel in an any field practical training is an integral part to imply theoretical

    studies to a practical approach it makes the individual to the actual practical conditions.

    Which could have been impossible to be tough in a classroom. A trainee learnt dealing

    with the worker and management- working environment along with operational skills.

    Insurance ranks as one of the most important industry in any part of the world.

    It is also an industry where competitors drive excellence. This is why the entry in India

    of foreign insurers, as minority partners in domestic joint ventures, has bought the hope

    that market will reach a new level.

    I have tried to do an analytical study on advisors perception towards life

    insurance market in Kota. In this study I tried to find out those facts, which do matter

    for a advisor for doing this job in insurance sector.

    Sunil Kumar Jain

    MBA Part- III

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    ACKNOWLEDGMENT

    It gives me immense pleasure and a sense of honor to express my feeling of gratitude to

    all those who have helped me in the successful competition of the present project.

    First and foremost I express my deep sense of thankfulness to Mr. Amit

    Sharma, Tertiary Manager in Reliance for his valuable co-operation and guidance in

    undertaking this work.

    My warm acknowledgment is also due to all staff members of Reliance Kota,who took keen interest in extending necessary co-operation at various stages during the

    study.

    I cant refrain my humble thanks to Er. K.C. Vijay (Director, Modi Institute Of

    Management & Technology,Kota) and the faculty of MIMT

    In end, I would like to thank to each of them who directly or indirectly helped in

    completion of the project.

    Sunil Kumar Jain

    MBA Part- III

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    One of the most important reasons for me to select this project was the wide

    areas of activities which were covered under this project. Insurance sector is one of the

    fastest growing industries of today. The chance to work in such a promising sector that

    to with the market leader like Reliance was a wonderful opportunity for me.

    In first part of this report I have tried to give a detailed outline about what

    exactly insurance sector is all about. Its history, current business environment, the

    governing authority i.e. IRDA (Insurance Regulatory and Development Authority) and

    of course my company Reliance Life Insurance Company Ltd.

    The second part of this report gives out the detailed information about the

    activities that I carried out in this project which are as follows:

    Recruiting Insurance Advisors for Reliance Life Insurance from various

    traditional sources.

    Identifying the new source of Recruitment for Future Recruitments giving

    information about different plans and benefits of rides of Reliance Life

    Insurance.

    Conducting a research for advisors/ agents of various insurance companies.

    For the purpose of Agency Recruitment I had to personally meet and explain the

    business opportunity offered by the reliance Life Insurance to people who were

    identified as most suitable for the job. This interaction was a very enriching experience.

    For the purpose of research I met to the advisors/ agents of the various insurance

    companies. In this work I had chance to know that what advisors/ agents of different

    insurance companies think about their company product and market.

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    DECLARATION

    I hereby declare that the present report entitled Study of Advisors

    Perception towards Life InsuranceMarket in Kota is bevel on my original

    work and indebtedness to other work / Publication has been duly

    acknowledged at relevant place.

    Submitted By:Sunil Kumar Jain

    MBA III Sem

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    Chapter No. Contents

    1 Introduction to insurance

    Introduction to insurance

    History of Insurance

    Necessity of Life Insurance

    Benefits (Advantages) of life insurance

    Market players

    Composition of Authority by IRDA Act, 1999.

    Basic Objectives of IRDA.2. Company Details

    About Reliance Life buys AMP Sanmar Group

    About Reliance Capital Limited.

    About Reliance Life Insurance Co. Ltd.

    BOD3. Product Details

    Different Plans4. The Advisors / Agents

    About the Advisors

    Professional requirements of agents.

    Characteristics of an Advisors

    Benefit of an Advisors

    Be an Advisors

    Skill building by Special Training Programme

    (RACE)5 Research Methodology

    Scope of the study

    Objectives

    Research Methodology

    Analysis & Interpretations

    6

    Conclusions Suggestions

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    Limitations

    7 Bibliography8 Appendix

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    (Introduction to Insurance)

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    INTRODUCTION OF INSURANCE

    All the human beings on the earth know that they will die in future but

    they dont want to die. They want to fulfill all the dreams, which they had

    thought, but there are times when all these dreams cant come true.

    Death is inevitable and yet we live our lives obvious to reality that may

    strike- when we have no idea. And when it happens all the dreams come

    crashing down.

    In the words of D.S. Hansell Insurance may be defined as social

    device providing financial compensation for the effects of misfortune, the

    payment being made from the accumulated contributions of all the

    parties participating in the scheme.

    Life insurance is the only tool to secure our life in future. It also

    provides a safe guard to the uncertainty of our life. Life Insurance is the

    cheapest investment tool in which we can earn more in a short period of time.

    Life insurance is meant to protect our loved ones and us in future. The

    function of insurance is to protect you against losses you cant afford. This is

    done by transferring the risks of a person, business, or organizationthe

    Insuredto an insurance company, or insurerThe insurer then

    reimburses the insured for covered lossesi.e., amount of money, called a

    premium, to the insurer to transfer the risk. The insurer pools all its premium

    into a large fund and when a policyholder has a loss. The insurer draws funds

    from the pool to pay for the loss life is full of unexpected events that can

    create large financial losses. For example wherever you drive, it is possible

    that you may have a costly accident. Risk affects you by causing worry about

    potential loss and how to deal with the consequences. Insurance reduces

    anxiety over possible loss and absorbs the financial brunt of its

    consequences.

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    India has traditionally been a high savings oriented country being on

    par with the thrifty Japan. Insurance sector in the United States of America is

    as big in size as the banking industry there. This gives us an idea of how

    important the sector is Insurance sector channelises the savings of the people

    to long-term investments. In India where infrastructure is said to be of critical

    importance, this sector will bring the nations own money for the nation.

    The Global Life Insurance market stands at $ 521.2 billion while

    non-life insurance market is placed at $ 922.4 Billion.

    India takes the 23rd position with US$9.333 billion annual premium

    collections and a meager 0.41% share.

    Out of one billion people in India only 35 million people are covered by

    insurance.

    Indian insurance market is set to touch S25 billion by 2010 on

    the assumption of a 7 percent real annual growth in GDP.

    In 3 years time we would expect the 10 % of the population to be under

    some sort of an insurance cover. This assuming a premium of Rs. 5000 on an

    average amounts to 100 million x Rs. 5000 = Rs. 500 bn.

    This has made the sector the hottest one in India after IT. With social

    security to the public at large being the agenda for opening the sector, the role

    of the regulator becomes all the more serious and one that would be carefully

    watched at every step.

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    1.2 HISTORY OF LIFE INSURANCE

    Insurance in India has started without any regulation in the Nineteenth

    century was a typical story of a colonial era. A few British Insurance

    Companies dominating the market serving mostly large urban centers. Afterthe1 independence, it took a dramatic turn.

    Insurance was nationalized, first the life insurance companies were

    nationalized in 1956, and then the general insurance business was

    nationalized in 1972 and in 1999 private insurance companies have been

    allowed into the business of insurance with a maximum of 26% of foreign

    holding.

    CONCEPT OF INSURANCE

    Basically insurance is a device to share the losses of few, by transferring a

    portion of the loss to the insurance company in exchange for a certain cost.

    This means that a lot of people who think they may suffer a loss, each put in a

    little money to cover financial costs for those among them who actually

    sustain the loss. Obviously, since there is a cost you dont insure anything or

    everything, you will cover only those things that would cause a substantial

    financial burden unexpectedly on you, if you had to replace them on your own.

    Hence, insurance works on the concept of risk sharing, which divides risk a

    among may people. For example, all of you run the risk of having your car

    stolen. However the past may tell us that only of your cars will actually be

    stolen this year. Therefore you may all get together and decided to each pay a

    small amount that will go to the unlucky person (could be you) will actually

    may have his car stolen.

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    HISTORICAL PERSPENCIVE: -

    A French proverb says: Deeper you look into the history; further will be your

    vision. So before we strategize, let us have a quick look into the history.

    Insurance is some form is as old as historical society.

    So-called bottomry contracts were know to merchants of Babylon as early as

    4000-3000 BC and was well understood in ancient Greece as early as the 4 th

    century BC. Under a bottomry contract, loans were granted to merchants will

    the provision that if the shipment was lost at sea the loan did not have to be

    repaid.

    The interest on the loan covered the insurance risk. Ancient Roman law

    recognized the bottomry contract in which an article of agreement was drawn

    up and funds were deposited with a money changer.. In Rome there were

    also burial societies that paid. The insurance contract also among other

    maritime national in commercial contact with Greece. In China, merchants

    who had to travel on the dangerous Yangtze River spread their goods on

    several ships, so if a ship wet down, no one person would lose all of his

    goods. All these established the basic idea of insurance.

    Other types of causality insurance: -

    Auto

    Workers compensation

    Crime and vandalism.

    These may appear technical and confusing. So let us go trough some of

    the basic terminology and concepts insurance companies use in their

    business. When we talk about insurance we are primarily concerned with

    insurable items. To be insurance the following criteria must be met:

    1. There must be a large number of persons available for insurance with a

    similar potential for loss-the law of large number.

    2. Loss must be definite (death, car damaged in an accident).

    3. Loss must be accidental in nature (unexpected and beyond the control

    of the insured).4. Loss must barge enough to cause a financial burden.

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    5. The cost of insurance must be affordable. The insurance cost should

    be traction of the value of the item.

    6. Loss must be calculable; a monetary amount must be determined for

    the loss.

    Colonel rule in India provided great fillip to the insurance in India its contents

    given below: -

    INSURANCE UNDER THE BRITISH RAJ

    Life insurance in the modern form was first set up in India through a

    British company in 1818 followed by the Bombay assurance Company

    operated in India but did not ensure the lives of India but did not insure the

    lives of India. Some of the companies that started later did provide insurance

    for Indians. But they were treated as Substandard and therefore had to pay

    an extra premium of 20% or more. The first company that had policies that

    could be thought by Indians with fair value was the Bombay Mutual Life

    Assurance Society starting in 1871. The first general insurance companyTriton Insurance Company Limited, was established in 1850. it was owned

    and operated by the British, the first indigenous general insurance company

    limited set up in Bombay in 1907.

    By 1938, the insurance market in India was buzzing with 176

    companies (both life and non life). However, the industry was plagued by

    fraud. Hence a comprehensive set of regulations was put in place to stem thisproblem. By 1956, there were 154 Indian insurance companies, 16 non-

    Indian insurance companies and 75 provident societies that were issuing life

    insurance policies.

    Most of these policies were centered in the cities (especially around big

    cities like Bombay, Calcutta, Delhi and Madras). In 1956, the then Finance

    Minister S.D. Deshmukh announced nationalization the life insurance

    business.

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    SOME OF THE IMPORTANT MILESTONES IN THE

    INSURANCE BUSINESS IN INDIA ARE:

    1912: The Indian Life Insurance Companies Act enacted as the first to

    regulate the life insurance business.

    1928: The Indian insurance companies act enacted to enable the government

    to collect statistical information about both life and non- life

    insurance businesses.

    1938: Earlier legislation consolidated and amended by the

    insurance act with the objective of protecting the interest of the

    insuring public.1956: 245 Indian and Foreign insurers and provident societies taken over by

    the Central Government and Nationalized LIC formed an Act of

    Parliament viz LIC Act.

    1993: Setting up of Malhotra Committee.

    1994: Recommendations of Malhotra Committee.

    1995: Setting up of Mukherhjee Committee.

    1996: Setting up of (Interim) Insurance regulatory Authority (IRA)

    recommendations of the IRDA.

    1997: Mukherjee Committee report submitted but not made public.

    1997: The government gives greater autonomy to LIC, GIC and its

    subsidiaries with regard to the reconstructing of Boards and

    flexibility in investment norms aimed at channeling funds to the

    infrastructure.

    1998: The Cabinet decides to allow 40% foreign equity in private insurance

    companies 26 % to foreign companies and 14 % to NRIs OCB

    and FIIs.

    1999: The standing committee headed by Murali Deora Decides that foreign

    equity in private insurance should be limited to 26%. The IRA bill

    is renamed the Insurance Regulatory and Development

    Authority (IRDA) bill.

    1999: Cabinet clears IRDA bill.

    2000: President gives assent to the IRDA bill.

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    1.3 NECESITY OF LIFE INSURANCE:

    Risk and uncertainties are part of life great adventure- accident,

    illness, theft, natural disaster- theyre all built into the working of the universe,waiting to happen. Insurance then is mans answer to the vagaries of life. If

    you cannot beat man-made and natural calamities, well, at least be prepared

    for them and their aftermath.

    Insurance is a contract between two parties- the insurer (the insurance

    company) and the insured (the person or entity seeking the cover)-wherein

    the insurer agrees to pay the insured for financial losses arising out of any

    unforeseen events in return for a regular payment of Premium

    These unforeseen events are defined as Risk and that is why

    insurance is called a risk cover. Hence, insurance is essentially the means to

    financially compensate for losses that life throws at people- corporate and

    otherwise.

    1.4 BENEFITS OF LIFE INSURANCE:

    Superior to any other savings plan

    Unlike any other savings plan a life insurance policy affords full protection

    against risk of death. In the event of death of a policyholder, the insurance

    company makes available the full sum assured to the policyholders near and

    dear ones. In comparison, any other savings plan would amount to the total

    savings accumulated till date. If the death occurs prematurely, such savings

    can be much lesser than the sum assured. Evidently, the potential financial

    loss to the family of the policyholder is sizable.

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    Tax Relief

    Under the Indian Income tax Act; the following tax relief is available-

    a) 20% of the premium paid can be deducted from your income taxliability.

    b) 100% of the premium paid is deductible from your total taxable

    income.

    Where these benefits are factored in it is found that most policies offer

    returns that are comparable or even better than other saving modes such

    as PPF, NSC etc. Moreover, the cost of insurance is a very negligible.

    1.5 THE MARKET PLAYERS

    As of now there are 14 players in Indian Insurance Market, who have

    made their registration for Life Insurance Business with IRDA (Insurance

    Regulatory & Development Authority) plus there are some major players

    like reliance who wish to join this sector in following years. The standard

    patter for all the companies joining this market is of a join venture betweenan Indian company (around 75 %) and a Foreign Insurance Company

    (around 25%). The main purpose of this sort of arrangements is that the

    Indian Company is having the basic systems, infrastructure and

    distribution network for spreading the insurance products in India. And the

    foreign partner bring in with it, the experience, Know- how and R & D of

    insurance products, in which it ahs been dealing for long time through out

    the world.

    The names of all the companies are as follows.

    1. Life Corporation of India (LIC)

    2. HDFC Standard Life Insurance Company Ltd. (23/10/2000)

    3. Max New York Life Insurance Co. Ltd. (15/11/2000)

    4. ICICI Prudential Life Insurance Co. Ltd. (24/11/2000)

    5. Kotak Mahindra Old Mutual Life Insurance Ltd. (10/1/2001)

    6. Birla Sun Life Insurance Co. Ltd. (31/1/2001)

    7. Tata AIG Life Insurance Co. Ltd. (12/2/2001)

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    8. SBI Life Insurance Co. Ltd. (30/3/2001)

    9. ING Vysya Life Insurance Co. Ltd. (2/8/2001)

    10. Bajaj Allianz Life Insurance Co. Ltd. (3/8/2001)

    11. Metlife India Insurance Co. Ltd. (3/1/2001)

    12. Aviva Life Insurance Co. Ltd. (14/5/2002)

    13. Sahara India insurance Co. Ltd. (6/2/2004)

    14. Reliance Life Insurance Co. Ltd. (4/10/2005)

    1.6 INSURANCE REGULATORY AND DEVELOPMENT

    AUTHORITY

    When in government decided to privatize insurance sector in 1999, strong

    need of a Regulatory Authority was felt. This was in the backdrop of

    experience of investors who had been robbed before through various financial

    scams such as stock exchange frauds, chit funds, plantation investments etc.

    thus IRDA (Insurance Regulatory and Development Authority) was born.

    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 Chairman;

    Five whole- time members;

    Four part- time members,

    (All appointed by Government of India.)

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    The Basics Objectives of IRDA are:

    To protect the interest of and secure fair treatment to policyholders:

    To bring about speedy and orderly growth of the insurance industry

    (including annuity and super annuation payments), for the benefit of the

    common man long term funds for accelerating growth of economy.

    To set, promote, monitor and enforce high standards of integrity, financial

    soundness, fair dealing and competence of those it regulates.

    To ensure that insurance customers receive precise, clear and correct

    information about products and services make them aware of their

    responsibilities and duties in this regard.

    To ensure speedy settlement of genuine claims, to prevent insurance

    frauds and other malpractices and put in place effective grievance

    redressal machinery;

    To promote fairness, transparency and orderly conduct in financial

    markets dealing with insurance and build a reliable management

    information system to enforce high standards of financial soundness

    amongst market players.

    To take action where such standards are inadequate or ineffectively

    enforced;

    To bring about optimum amount of self- regulation in day-to-day working of

    the industry consistent with the requirements of prudential regulation.

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    (Introduction to Company)

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    Introduction to Company

    2.1 ABOUT RELIANCE LIFE BUYS AMP SANMAR GROUPThe Chennai based Sanmar Group today announced the sale of its

    interest in AMP Sanmar Life Insurance Company to Reliance Life Insurance,

    a subsidiary of Reliance Capital Limited (RCL). AMP Sanman Life Insurance

    Company is a joint venture of AMP, Australia and Sanmar Group.

    Headquartered in Channai, it as over 90 offices across the country, 9000

    agents. The decision to sell the company was taken consequent to AMPs

    intention to exit the insurance business in India.

    The consideration for the deal has not been disclosed. Asked about

    this the Sanmar Group Chairman Mr. N. Sankar, told business line that AMP

    had requested to keep the consideration confidential because of regulatory

    requirements in Australia. He added that Sanmars stake in AMP Sanmar life

    was through & investment companies of the group, which in turn are wolly

    owned subsidiaries of the group holding company Sanman Holding Ltd.

    Taking over AMP Sanmal Life Insurance will get Reliance Life a

    readymade infrastructure and portfolio.

    AMP Sanmar offers a comprehensive range of life insurance products.

    AMP is a leading international financial services group with over 150 years

    with core business in insurance, asset management & financial planning.

    2.2 About Reliance Capital Limited:

    Reliance Capital is one of the Indian 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 proprietary investments, private equity and other activities in

    financial services. RCL is a Non-Banking Financial Company (NBFC)

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    registered with the Reserve Bank of India under section US-IA of the Reserve

    Bank of India Act, 1934.

    Reliance Capital sees immense potential in the rapidly growing

    financial services sector in India & aims to become a dominant player in this

    industry & other fully integrated financial services RLI in another step forward

    for R.C.L. to offer RLI is another step forward for R.C.L. to offer need based

    Life Insurance Solution to individuals and corporate.

    2.3 About Reliance Life Insurance Co. Ltd.

    Type : Private Limited Company

    Headquarter : Chennai (India)

    Industry : Life Insurance

    Products : Individual & group insurance plans

    Anil Ambani group & AMP Sanmar - 1st August 2005.

    Reliance Life to get aggressive IRDAs recognition 2nd February 2006.

    Reliance Life Insurance gets ISO 9001-2000 certification- 28th March 2007.

    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 sectorfinancial services companies, and ranks among

    the top 3 private sector financial services and banking companies, in terms of

    net worth

    Reliance life insurance is another step forward for Reliance Capital

    limited to offer need based life insurance solution to individuals and corporate

    in India. Reliance Life Insurance is an associate company of Reliance Capital

    Limited, which along with its associates has acquired 100% shares in AMP

    Sanmar Life insurance Co. Ltd. in August 2005. taking over AMP Sanmar Life

    provided Reliance Life Insurance a readymade infrastructure and a portfolio.

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    It is the fastest growing life insurance company in India, private

    insurance players in the country on the back of a widespread & rapidly

    growing branch network. RLI rapidly has pan presence and a range of

    products catering to individual as well as corporate needs. A total of 16

    products covering saving protection & investment requirements. As is

    evident from the growth of 380% in new business premium last years, the

    move from the 12th to 5th position, over the past one year with an increase in

    the number of branches from 118 to 339 and increase in the number of

    employees from 2943 to 3802.

    The sales force is much stronger with an increase in advisors from

    2231 to 95557 and third party distribution have increased from 62 to 79.Three

    new products have been launched till date and many more are yet to come

    and there will be no looking back. A grand beginning only promises a greater

    achievement with the passage of time.

    The company acquired 100 per cent shareholding in AMP Sanmar Life

    Insurance Company in August 2005. Taking over AMP Sanmar Life provided

    Reliance Life Insurance a readymade infrastructure and a portfolio. AMPSanmar Life Insurance was a joint venture between AMP, Australia and the

    Sanmar Group. Headquartered in Chennai, AMP Sanmar had over 90 offices

    across the country, 9,000 agents.

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    RLI would strive hard to achieve the following goals:

    Emerge as transnational life insurance of global scale and standard.

    Achieve impeccable reputation & credentials through best business

    profiles.

    Vision : Empowering every one live their dreams.

    Mission: Create unmatched value for everyone through dependable,

    effective, transparent, profitable life insurance and pension plans.

    Guiding Principles:

    - Customer care &n satisfaction.

    - Corporate Governance

    - Creativity & Innovation

    - Competitiveness.

    There new products have been launched tall date and many more are

    yet to come and there will be no looking back. A grand beginning only

    promises a greater achievement with the passage of time.

    2.4 Board of Director:

    CEO - Mr. P. Nandagopal

    CGO - Mr. Rajesh Bahi

    CMO - Mr. Rohit Gaurav Muli

    COO - Mr. K.V. Srinivasan

    Vice President (Group Infrastructure)- Mr. K. Suresh Babu

    Appointed Actuary - Ms. Pournima Gupte

    Chief Investment Office - Mr. R. Ranharajan

    Head HR - Ms. Maneesha Thakur.

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    (PRODUCTS DETAILS)

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    PRODUCT PROFILE

    3.1 Different Plans:

    Products are individual & group insurance plans life insurance policy is

    contract between the policyholder and the life insurance company. Since

    every contract is governed by certain conditions, which are mentioned in the

    agreement, a life insurance policy is also governed by conditions that are

    mentioned in the policy document.

    Our insurance policy comes laden with many conditions-

    - Explanatory (do not effect the benefit under the policy)- Restrictive (which reduce the scope of the coverage under

    the policy Eg. Suicid, war, proof of age etc.

    That conditions need to pay due attention to while opting for following plans:

    1- Reliance Money Guarantee Plans:

    Unit linked insurance plan.

    Offers to safeguard your returns through the return shield option.

    Option to switch between plans through the exchange option.

    Three pre packaged investment fund options to choose from.

    Basic Minimum Maximum

    Age of entry 30 days 50 yrs. Last birthdayAge of

    maturity

    18 yrs. Last birthday 80 yrs. Last birthday

    Policy term 10 yrs. 30 yrs.Sum assured Annualized premium for half the policy

    term.Minimum Regularly Premium:

    Yearly Half Quarterl Monthly

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    Yearly y

    Regular Premium

    Option

    Rs.

    10,000

    Rs. 5,000 Rs. 2500 Rs.

    1000Minimum top up

    amount

    Rs. 2500 under all policies

    2- Reliance Market Return Plans:

    Unit linked life insurance plan.

    Choose from four different investments funds and choose to

    switch between them. Option to pay regular as well as single premium and top- ups.

    Package our policy with accidental riders.

    Basic Minimum Maximum

    Age of entry 30 days 65 yrs. Last birthdayAge of maturity 18 yrs. Last birthday 80 yrs. Last birthdayPolicy term 5 yrs. 40 yrs.

    Minimum Regular Premium:

    Yearly Half

    Yearly

    Quarterl

    y

    Monthly

    Regular Premium

    Option

    Rs.

    10,000

    Rs. 5,000 Rs. 2500 Rs.

    1000Minimum top up

    amount

    Rs. 25,000 under all policies

    Minimum Sum assured:

    Regular Premium: Annualized premium for 5 yrs. Or annualized premium

    for half the policy term, whichever is higher.

    Single premium: 125% premium of the single premium.

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    Maximum Sum Assured

    No limit (Rs. 5,00,000 for age up to 12 years.)

    3- Reliance Golden Years Plans:

    A Unit linked pension product with a vesting age between 45

    yrs. To 70 yrs.

    Choose from tour different investments funds and choose to

    switch between them.

    Option to pay regular, single as well as top- up premium.

    Tax free commutation up to one third of fund value at vesting

    age.

    4- Reliance Golden Years Plan Plus:

    Unit linked pension plan with vesting age between 45 and 64

    years.

    Four investments four options to choose them.

    Option to switch between funds.

    Option to propone your vesting age.

    Sum assured plus fund value is payable to the beneficiary on

    death.

    5- Traditional Plans:

    Other traditional plans are Reliance cash flow plan, Reliance child plan,

    Reliance special fundowment plan etc.

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    (THE ADVISORS/ AGENTS)

    4.1 INSURANCE ADVISORS

    Person who sells insurance policies for a single insurance company, in

    return for a commission is called ADVISOR.

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    Insurance advisors are the bridge or the channel partners between the

    policyholder and insurance company. They make the base for the insurance

    company. In other words, it can be said that advisors are those people in the

    organization who can give business to the company.

    They are the representatives of an insurance company who sells

    insurance. An insurance advisor locates prospective insurance customers

    determines the insurance needs of each customer, and assists the customer

    in applying for insurance. Typically, an insurance advisor will deliver the policy

    when the application is approved, will collect the initial premium and will

    provide customer service to policy owners. An advisor is also called a field

    underwriter or a life underwriter.

    4.2 Professionals requirements of advisors:

    Candidate should satisfy 5 out above 7 requirements to appear in pre

    test. (Pre- Recruitment Examination)

    Aged between 25 & above.

    Education Qualification- Graduate

    Resident in the area for 3 yrs or more.

    4.3 Advisor must have following characteristics:

    1. Communication Ability: Clearly express oneself in formal and

    informal settings.2. Inter Personal Skills: Listening effectively, maintaining emotional

    control, presenting effective counter arguments without criticizing or

    threating.

    3. Market Understanding: This includes ability to assess both the

    breadth & depth of potential markets.

    4. Goal and achievement Motivation: Ability to set long & short term

    goals, channels ones own effect towards achieving them. This

    includes completing tasks that have been started.

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    5. Time Management, Administrative ability, Independence/ self reliance,

    Technical Knowledge.

    4.4 Benefits for an Advisor:There are some reasons and parameters to be an advisor of the

    insurance company which are mentioned below:

    a) Money:

    Money is the biggest reason to join as an advisor in a life insurance company.

    Only in this industry you can invest minimum and earn maximum. There is no

    limit for earning in this industry.

    b) Estate Creation:

    In this industry, the advisors are also paid commission till the maturity of the

    policy. Moreover, advisor is also paid renewal commission every year and this

    renewal commission helps the advisor to build an estate. It means a policy

    that is sold today will pay the advisors may be more than 10 to 15 years. It

    means each year you will get more and create an estate for advisors like

    house, car, childrens future etc.

    c) Status:

    Advisors secure the life of the human beings. They give advise to their client

    where to invest money and where not. So advisors become specialist in the

    investment field. It means advisors will get status by helping the human

    beings by a proper guidance.

    d) Prestige:

    Company will give the advisors foreign trips, gifts and many more things. It

    also provides advisors a club membership. These all will give the advisors

    prestige and a unique position in the society.

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    e) Honor:

    Reliance Life Insurance provides motivational factors to the advisors. It gives

    a target to the advisors and if advisors reach this target, RLI l will give them a

    trophy, a certificate and incentives in the meeting of the company. Advisors

    can also become the member of MDRT and the Reliance Life Insurance will

    honour such advisors.

    f) Widen Social Circle:

    Life insurance is the business of contracts. As the time passes in this

    business more people will know and recognize the advisors. In this way, the

    advisors can widen their social circle in a strategic manner.

    g) Mitigate Human Hardship:

    When advisors come into the life insurance business, they dont sell only

    policy to the people but they provide safety against the uncertainty of the life.

    They help the people in peace of mind, freedom from the troubles and help

    them support themselves.

    h) Contribute to the nation:

    Each policy sold by the advisors will help the nation to increase the funds that

    go towards developing the country, for improving economy, improve standard

    of living and nature the upcoming industries.

    4.5 Be an Advisor:

    Being a Reliance Life Insurance advisor can be enriching and exciting career

    option. Its an opportunity to associate with an industry tender, be in touch

    with the latest and finest insurance practices from around the globe, and grow

    both personality and professionally.

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    Here are some of the benefits of being an Reliance life Insurance

    Advisor:

    Unlimited earning potential.

    Clear career path. All round support through exclusive advertising, your own in house

    consultant and world class training.

    A comprehensive benefit package.

    To be part of world class team.

    Be your own Boss.

    Flexible working environment.

    Promotion opportunity.

    4.6 Skill Building by RACE

    RLI provides a special 100 hour training programme that advisors

    undergo for procurement of their insurance selling license from IRDA. This

    special training programme called RACE (Reliance Academy of Competence

    Enhancement) to add to their ability in their journey towards becoming full-

    fledged financial planning advisors.

    The objective of this programme is to develop certified and professional

    financial advisors who can import value- added services to our customers.

    The induction training, through a consultative approach aims at detailing the

    basics of life insurance, Reliance Life Insurance products and a reliance Life

    insurance way of selling.

    The programme also covers all the under writing and business

    process. Post- induction, the foundation levels continuous learning sessionbuild on these areas by enabling our advisors to overcome issues faced .

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    (RESEARCH METHODOLOGY)

    5.1 SCOPE OF THE STUDY

    The whole study was basically on the collection of data from primary

    sources. For collection of primary data a survey was conducted in various

    markets.

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    Methodology has been extensively discussed under the heading given

    below on the following pages:

    Research Design

    Collection of Data Sampling scheme.

    (i) Research Design:

    The Research design is a pattern or outline of a research projects

    work. It is a statement of only the essential elements of a study,those that

    provide the basic guidline for the detail of project. The present study being

    conducted followed a descriptive research design. It produce a picture ofthe phenomemon decision maker is interested. Design of descriptive studies

    includes the nature and source of data,the nature of the expected result and

    the analytical method.

    (ii) Source of Data:

    Primary Data: The primary data has been collected by survey method. This is

    or the most economical, efficient and effective way of collecting the data. Ityields a wide range of information on various characters like attitude, opinion,

    behaviour etc. Primary data was collected through questionnaire.

    Secondary Data: The secondary data has been collected by websites,

    brochures, journals, Magazines etc.

    Preparing a suitable data collection method: In this project it was found

    that a questionnaire was the best method of obtaining the relevant data. Asurvey was found to be most appropriate to serve the objective already

    prepared. The research carried out through the market survey was conclusive

    and descriptive in nature.

    (iii) Sampling Scheme:

    In this project random sampling was the appropriate method. A sampling

    design is a definite plan determined before any data actually collected for

    obtaining representative result.

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    1- Type of Universe : The first step in developing any sampling

    design is to clearly define set of objects, technically called

    the universe.

    2- Sampling Size : (15 each from five insurance companies.)

    (i) Reliance - 15

    (ii) ICICI Pru. - 15

    (iii) Bajaj Allinz - 15

    (iv) SBI - 15

    (v) LIC - 15

    Tool : Questionnaire

    Sample size is the total number of respondent included in the sample

    assuming them to be true representative of the population. In my survey, I

    have chosen a sample size of 75 respondents as an appropriate sample size.

    I tried to contact only those persons who could give unbiased and

    representative information.

    5.2 Objectives:

    1- To know about advisors perception towards insurance fields.

    2- To know about advisors perception towards their respective insurance

    company.

    3- To know about advisors working pattern.

    4- To know about advisors satisfaction regarding commission.

    5- To know about motivational and de- motivational factors for advisors.

    5- To find out grow fact of insurance agents regarding their career

    prospects.

    5.3 Research Methodology:

    Nature of Data : Primary Data

    Area of Research : Kota

    Sample Size : 75 advisors/ agents

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    Sampling Procedure : Convenience Sampling

    Data collection Method : Questionnaire & Interview

    Research Instrument : Questionnaire

    Research Design : Descriptive

    5.4 Analysis and interpretation:

    How long have you been with the company.

    Interpretation:

    55% of them are working from less than 8 month and 30% are working

    between 8-12 months. From this we can understand that from last some

    time insurance market is in boom so more and more persons are joining it.

    What about your recruitment process.

    37

    55%

    30%

    15%

    0%

    10%

    20%

    30%

    40%

    50%

    60%

    < 8 month 8 to 12 month >12 months

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    0

    10

    20

    30

    40

    50

    60

    70

    80

    90

    SOPHASTICAL SUITABLE

    NOO

    FEMPLOYE

    Interpretation:

    83 % of the agent say about the recruitment process is sophistical.And rest of say suitable.

    This job is taken as a part time or full time.

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    0

    10

    20

    30

    40

    50

    60

    70

    80

    FULL TIME PART TIME

    NOO

    FEMPLOYE

    Series1

    Interpretation:

    68% of Advisors having this job as a part time. It shows that they are also

    involved in some other job/service/business. But 32% people are believe in

    full time but put full output towards the organization.

    How many days are devoted for this work in a week.

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    Interpretation:

    80% of advisors are devoting 1-3 days in a week.

    What is your joining age.

    40

    47%

    33%

    12%8%

    0%

    10%

    20%

    30%

    40%

    50%

    1 day 2-3 days 4-5 days whole

    week

    10%

    55%

    25%

    0%0%

    10%

    20%

    30%

    40%

    50%

    60%

    below 20 yrs. between 20-

    35 yrs.

    between 35-

    50 yrs.

    above 50 yrs.

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    Interpretation:

    55% of advisors have a joining age between 20- 35 yrs. No one advisor

    joins above 50 years.

    Which is the most selling product.

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    0

    10

    20

    30

    40

    50

    60

    70

    ULIP PLAN TRADIATIONAL PLAN OTHER PLAN

    NOO

    FEMPLO

    YE

    Interpretation

    86% of advisors are agreed that ULIP plans are most selling plans because

    it gives

    highest return as well as risk cover to the customers.

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    Which factor motivates you the most.

    0

    10

    20

    30

    40

    50

    60

    70

    80

    COMMISSION MANAGER'S

    SUPPORT

    CONTESTS

    NOO

    FEMPLOYE

    Interpretation

    Their commission motivates 82% of advisors and they are least motivatedby

    managers support & contests.

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    Which factor motivates the customers the most to invest in insurance.

    Interpretation

    21% of customer are motivated by their returns, 43% of customers are

    motivated by their tax saving, 11% of customer are motivated by

    investment, 25% of customer are motivated by risk cover.

    44

    43%

    21%

    11%

    25%

    0%

    10%

    20%

    30%

    40%

    50%

    tax saving returns inves tment risk cover

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    Do you show the allocation charge & fund management charge to thecustomers.

    0

    10

    20

    30

    40

    50

    60

    ALWAYS NEVER DEPAND

    NOO

    FEMPLOYE

    Interpretation

    50% of advisors show the allocation charge & fund manager charge. It

    shows that

    they tell every thing to the customer relating to the product.

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    Have you got benefits of a special training programme, RACE

    (Reliance Academy of competence Enhancement)

    0

    10

    20

    30

    40

    50

    60

    70

    YES NO

    NOO

    FEMPLOYE

    Interpretation

    65% advisors have had the benefits of RACE (Reliance Academy of

    competence Enhancement)

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    6.1 CONCLUSION

    1- Ulip is the most selling plan.

    2- 55% of advisors have been with the company since 8 months so it

    is a fastest growing corporation in India.

    3- 23% of advisors are dissatisfied with their commissions and they

    would change their company if provided with good options.

    4- Mostly, customers are motivated by tax saving.

    5- 68% of advisors are doing this work as a part time job and 80% of

    the advisors are devoting less than and equal to 3 days a week for

    this work.6- Commission motivates advisors the most and the demotivating

    factors are formalities. Unachieved targets, unsystematic training

    and best motivational factors are managerial support & contests.

    7- Mostly person joins as advisors at the age of 20-30 years.

    8- Mostly advisors have a proper time management between their

    both jobs (Part time & Full time)

    9- Some advisors (35%) could not attend RACE programme because

    of inconvenient time of training programme.

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    6.2 SUGGESTIONS

    1- Formalities should be reduces as much as possible at the time of

    recruitment.

    2- Advisors should provide enough chances for promotion.

    3- Proper training should be provided to advisors. When new plans are

    introduces and training should be organized in some shifts so that

    95% of advisors could attend it.

    4- Commission should be increased.

    5- Feedback should be taken time to time from advisors by personal

    meeting.6- Company should be intimating renewal premium information to the

    customer.

    6.3 LIMITATIONS OF THE STUDY

    The research area was restricted only within the Kota city. This

    may not reflect the exact position of the total market.

    Sample size was also so less, limitation of time means and

    resource forced for small size.

    Questionnaire includes 16 question, which affects the mentality

    of respondents that is time consuming.

    Time constraint.

    Money Constraint.

    It is a human tendency or it is a mental state of mind that whenever

    they are being observed, interviewed by unknown person they behave

    artificially as hesitate to disclosing the facts. This is common problem while

    conducting the survey. This human behavior may distort the result.

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    50

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    References

    1.. www.reliancelife.co.in

    2.. www.reliancecapital.co.in

    3.. www.irda.co.in

    4.. Brushers

    5.. Magazine like Life First, Insurance Agents(Life &

    General) etc.

    6.. Advisor recruitment form.

    7.. Investment news.

    51

    http://www.reliancelife.co.in/http://www.reliancecapital.co.in/http://www.irda.co.in/http://www.reliancelife.co.in/http://www.reliancecapital.co.in/http://www.irda.co.in/
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    (APPENDICES)

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    Questionnaire

    Name:

    Age:

    Qualification:

    Annual Income:

    Sex:

    Q.1How long have you been with the company?

    (a) 12 months [ ]

    Q.2What about your recruitment process?

    (a)Sophistical (b)Suitable [ ]

    Q.3 This job is taken as a part time or full time ?

    (a)Full time (b) Part time [ ]

    Q.4 How many days are devoted for this work in a week?

    (a)1 day (b) 2-3 days (c) 4-5 days (d) Whole week [ ]

    Q.6 What was your joining age?

    (a)Below 20 Yrs. (b) Between 20-35 Yrs. (c)Bet. 35-50 yrs. (d)Above 50Yrs.

    [ ]

    Q.7. Which is the most selling product?

    (a)ULIP (b)Traditional plan (c) other [ ]

    Q.8 Which factor motivates you the most?

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    (a) Commission (b) Managers support (c) Contests [ ]

    Q.9 Which factor motivates the customers the most to invest in insurance?

    (a) Returns (b) Tax saving (c) Investment (d) Risk cover [ ]

    Q.10 Do you show the allocation charge & fund management charge to theircustomers?

    (a) Always (b) Never (c) Depend[ ]

    Q.11 Are you satisfied with your commission?

    (a) Yes (b) No [ ]

    Q.13 Have you got benefits of a special training programme, RACE?

    (a) Yes (b) No[ ]