First Progress Report, AKANKSHA JAIN, 05817003909

8/8/2019 First Progress Report, AKANKSHA JAIN, 05817003909

http://slidepdf.com/reader/full/first-progress-report-akanksha-jain-05817003909 1/26

CHAPTER-1. COMPANY PROFILE AND FUNCTIONAL ANALYSIS

KOTAK MAHINDRA OLD MUTUAL LIFE INSURANCE LTD.C-31,1st and 2nd Floor,Community Center,Janakpuri, New Delhi - 110 058.Tel No: 11 66084959

MULTINATIONAL COMPANY

CORPORATE OFFICE Kotak Mahindra Old Mutual Life Insurance Ltd.Unit nos. 901 & 902, 9th floor,

Wing A & B, Godrej Coliseum,Lokmanya Pan Bazar,Behind Evrard Nagar,Sion (E), Mumbai - 400 022Tel : +91 22 6621 5999Fax : +91 22 6621 5757, 6621 5858Email : [email protected]

BACK OFFICE Kotak Mahindra Old Mutual Life Insurance Ltd.Kotak Infiniti, Building no. 21, Infinity Park,

Off Western Express Highway,General A K Vaidya Marg,Malad (E), Mumbai – 400 097Toll Free : 1800 209 8800Email : [email protected]

WEBSITE:- www.kotaklifeinsurance.com

Geographical Areas of Operation

Agra

Ahmedabad

Ahmed Nagar

Ajmer

Akola

Gurgaon

Guwahati

Gwalior

Himmatnagar

Hissar

Jodhpur

Jorhat

Junagarh

Kaithal

Kalyan

Panipat

Panjim

Patan

Pathankot

Patiala

mailto:[email protected]

mailto:[email protected]



Alligarh

Allahabad

Ambala

Anand

Ankleshwar

Aurangabad

Bhadurgarh

Banglore

Bardoli

Bareilly

Baroda

Belgaum

Bharuch

Bhatinda

Bellary

Bhavnagar

Bhilai

Bhilwara

BhopalBhubneshwar

Bhuj

Bikaner

Bilaspur

Chandigarh

Chennai

Chochin

Coimbatore

Delhi

Dhanbad

Dhule

Durg

Hoshiarpur

Hubli

Hyderabad

Indore

Jabalpur

Jaipur

Jalandhar

Jalgaon

Jamnagar

Jammu

Jamshedpur

Jhansi

Jind

Godhra

Gorakhpur

Gurdaspur

Gurgaon

Guwahati

Gwalior Himmatnagar

Hissar

Hoshiarpur

Hubli

Hyderabad

Indore

Jabalpur

Jaipur

Jalandhar

Jalgaon

Jamnagar

Jammu

Kannur

Kalyan

Kannur

Kanpur

Kapurthala

Karnal

Khambhat

Khammam

Khanna

Kholapur

Kolkatta

Kollam

Kota

Kottayam

Khozikhode

Kurukshetra

Lucknow

Ludhiana

MaduraiMalappuram

Mangalore

Merrut

Mehsana

Mirzapur

Moga

Moradabad

Mumbai

Mysore

Nadiad

Nagpur

Nanded

Patna

Phagwara

Pondicherry

Porbunder

Pune

Raipur

Rajkot

Ranchi

Ratlam

Ratnagiri

Rudrapur

Rohtak

Sharanpur

Salem

Sangli

Shimoga

Silvassa

Sirsa

Sholapur Surat

Suriendranagar

Thane

Thrissur

Tiruvalla

Trichy

Trivendrum

Udaipur

Valsad

Vapi

Varanasi

Vellore



Erode

Faridabad

Ghandhidham

Ghandhinagar

Ghaziabad

Gondhal

Godhra

Gorakhpur

Gurdaspur

Jamshedpur

Jhansi

Jalgaon

Jalgaon

Jamnagar

Jammu

Jamshedpur

Jhansi

Jind

Narwana

Nasik

Nellore

Noida

Navashehar

Navsari

Palakkad

Palanpur

Panchkula

Vijaywada

Vishakapatnam

Vizag

Vyara

Warangal

Yamunanagar

NATURE OF THE ORGANISATION AND BUSINESS:-

It is a service organization in which various intangible products is provided to its

customer in the form of insurance plans which provide risk cover to them.

TYPE OF INDUSTRY & BUSINESS:-

It is related to territory sector in which service providing organization comes and it is a part of financial service industry under territory sector.

Kotak old mutual Life Insurance deals in Service industry. Kotak life insurance deals in

insurance that pays monetary proceeds upon the death of the insured covered in the

policy. Essentially, a life insurance policy is a contract between the named insured and

the insurance company wherein the insurance company agrees to pay an agreed upon sum

of money to the insured's named beneficiary so long as the insured's premiums are

current. Company deals in all functional like HR, MARKETING, and FINANCE etc. The

project is based on finance department of the company where company deals with

different insurance plans.



FINANCIAL ANALYSIS

Kotak Life Insurance (Kotak Mahindra Old Mutual Life Insurance Ltd.) is one of India’s

leading life insurance companies. It is joint venture between Kotak Mahindra Bank Ltd.

and Old Mutual Plc, South Africa, one of the biggest Life Insurance companies in the

world. Because of the strong investment lineage of Kotak group Kotak Life Insurance is

able to offer a comprehensive variety of products and services that suit the diverse needs

and risk-return profiles of every investor. We have been growing over the past 9 years and

are committed to using our expertise in securing your future and ensuring that your

investments keep giving you lucrative returns.

Financial highlights for 31st march 2010.

Premium earned: 28,680,489 thousand

Profit after tax: 692,246 thousandIncome from policy holder’s account: 708,478 thousand

VISION

Kotak Life Insurance has a deep rooted commitment to improve the quality of life of its

customers, employees and stakeholders. We aim at improving the long term value in our

relationship by continuous innovation and improvements. We do this by our three-prongeffort which strives to make Kotak Life Insurance a corporate with value:

Increase Customer Value: Kotak Life Insurance has gone to the heart of its customer's

requirements and developed products which are unique and serve the customer needs

perfectly. We built a relationship of mutual trust and benefit to serve the Indian customer.

At Kotak Life Insurance the customer always comes first.

Cohesive Work Environment: We form long-term partnership with our employees by

offering them an invigorating work experience. We not only demand loyalty, sincerity

and values but also give it back in equal measures. Kotak Life Insurance will like to offer

its employees space to grow, innovate and build a long-term career.



Work with Honour: Kotak Life Insurance delivers everyday services in the marketplace

with the high sense of duty and commitment. Our employees strive to build the long-term

value for all those come in contact with Kotak Life Insurance. Our consumers,

distributors, employees, shareholders and the nation have our commitment that we will

uphold the values of trust, integrity and a Sense of Honour in every thought, act and deed

in order to positively contribute to individual, society and nation growth.

MISSION

We focus on the needs of our customers and create confidence, trust and loyalty by

offering a wide range of innovative insurance solutions. Strengthened by our commitment

to professional management, we ensure the continued growth and advancement of our

employees.

PRODUCT RANGE

Individual Plan

Protection Plan

Kotak Eternal Life Plans

Kotak Loan Protection Plan

Kotak Term/Preferred Term Plan

Saving and Investment Plan

Kotak Super Advantage

Kotak Platinum Edge

Kotak Endowment Plan

Kotak Surakshit Jeevan

Kotak Safe Investment Plan II

Kotak Single Invest

Kotak Money Back Plan





UK. Originating in South Africa in 1845, it is among the top 50 largest companies in the

FTSE100. The group has a balanced portfolio of businesses offering Asset Management,

Life Assurance, Banking and General Insurance Services in over 40 countries, with a

focus on South Africa, Europe and the United States, and a growing presence in Asia

Pacific. Old Mutual plc employs approximately 53,000 employees worldwide and is

listed on the London and Johannesburg stock exchanges

Premium earned: 28,680,489 thousand

Profit after tax: 692,246 thousand

Number of employees: 5000

ORGANISATION STRUCTURE OF THE COMPANY.

In every branch a hierarchy is followed like:

COUNTRY HEAD↓

BRANCH MANAGER ↓

ASSISTANT BRANCH MANAGER ↓

SENIOR SALES MANAGER ↓

SALES MANAGGER ↓

LIFE ADVISORS

This is also called career progression path in an insurance company.

MARKET SHARE & POSITION OF THE COMPANY IN THE INDUSTRY.

Kotak Mahindra Old Mutual Life Insurance Ltd the fiscal 2007-08, the company reportedgrowth of 80%, moving from the 11th position to 9th. It captured a market share of

1.19% in 2007-08.

.



LEADERSHIP IN THE COMPANY

Kotak Life Insurance works as a team and have a flat management structure. Top

management has many years of experience which guide the company into a position of

leadership.

• Mr. Gaurang Shah - Director

• Mr. Pankaj Desai - Managing Director

• Mr. G Muralidhar - Chief Operating Officer

• Mr. Subhasish Ghosh - Sr. VP, Financial Institutions Group

• Mr. Sugata Dutta - Head Human Resources

• Ms. Elizabeth Venkataraman - Senior Vice President Marketing

• Mr. Andrew Cartwright - Appointed Actuary

• Mr. Suresh Agarwal - Head of Alternate channel

• Mr. Shekhar Bhandari - Head of Tied channel

• Mr. Anand Dewan - Head Business Impact Group (BIG)

•

Mr. Sandip Shrikhande - Head of Group Business• Mr. Dhiresh Rustogi - Chief Technology Officer

• Mr. Sudhakar Shanbag - Chief Investment Officer

CHAPTER -2: Job Specific analysis

There are mainly two tasks which are given to trainees in Kotak Mahindra Old

Mutual Life Insurance which are:

1. Recruitment of 2 financial advisors or 1 financial planning

2. 1 project report on allotted topic.

RECRUITMENT OF ADVISORS

http://www.kotaklifeinsurance.com/ver2/about-us/management_new.php









































In simple terms life advisor is a person in life insurance companies who advises customers

from the starting of their policy term to the maturity of that policy. Majorly, a life advisor

brings business for company. He goes to the customers, guide them to take appropriate policy,

and take care in completing the formalities of taking the policy.

A life advisor is the face of the company for the customers because he deals with customers

directly on behalf of the company and customers knows the life advisor by trusting on him.

These advisors help individuals, families, and businesses select insurance policies that provide

the best protection for their lives, health, and property. Depending on the policyholder’s

circumstances, a cash-value policy can be designed to provide retirement income, funds for the

education of children, or other benefits as well. Life insurance agents also sell annuities that

promise a retirement income. An increasing number of insurance sales advisors are offering

comprehensive financial planning services to their clients. These services include retirement

planning, estate planning, and assistance in setting up pension plans for businesses. As a result,

many insurance agents are involved in “cross-selling” or “total account development”. Besides

offering insurance, these advisors may become licensed to sell mutual funds, variable

annuities, and other securities. This practice is most common with life insurance agents who

already sell annuities, but many property and casualty agents also sell financial products.

There are several basic steps, which are to be followed by a Sales Manager to develop or let us

say form an agency of advisors. Some of these processes or methods are following: -

Recruitment of Agents

Training of Advisors

Exam and Licensing of Advisors

Training for business (PRODUCT TRAINING)

The first and the very foremost process of developing an Insurance Agency are to recruit

advisors. For this very process, the Agency Manager is the one who searches for the prospects

or the common man or in other words we can also say raw advisors. The Insurance Company

about then trains these raw Advisors, or we can also say that they are given training about the

knowledge and techniques of insurance There are several kinds of strategies for the





If we have more interest in selling, then one financial planning can be done by a trainee in

which a policy is sold to a person according to his personal and financial needs. The policy can

be of any type which is provided by the company like retiment plan, individual plan, child plan

etc.

PROJECT REPORT

After recognizing the one’s field of interest, a topic is alloted to each student for doing

research with the help of primary and secondary data. On allotted topic, every trainee will do a

research and make a report which is very much essential to submit to our industrial guides.



CHAPTER – I RESEARCH PROBLEM AND PURPOSEINTRODUCTION:

Financial planning is the process of assessing financial goals of individual, taking an

inventory of the money and other assets which the person have, determine life goals and

then take necessary steps to achieve goals in the stipulated period. It is a method of quantifying a person’s requirement in terms of money.

Financial services refer to services provided by the finance industry. The finance industry

encompasses a broad range of organizations that deal with the management of money.

Among these organizations are banks, credit card companies, insurance companies,

consumer finance companies, stock brokerages, investment funds and some government

sponsored enterprises. Financial Planning is one such advisory service, which is yet to get

recognition from investors. Although financial planning is not a new concept, it just

needs to be conducted in organized manner. Today we avail this service from Insurance

agent, Mutual fund agents, Tax consultant, Equity Brokers, Chartered Accountants, etc.

Different agents provide different services and product oriented. Financial Planner on

other hand is a service provider which enables an individual to select proper product mix

for achieving their goals.

The major things to be considered in financial planning are time horizon to achieve life

goals, identify risk tolerance of client, their liquidity need, the inflation which would eat

up living and decrease standard of living and the need for growth or income. Keeping all

this in mind financial planning is done with six step process. This are self assessment of

client, identify personal goals and financial goals and objective, identify financial

problems and opportunities, determining recommendations and alternative solutions,



implementation of appropriate strategy to achieve goals and review and update plan

periodically.

A good financial plan includes Contingency planning, Risk Planning (insurance), Tax

Planning, Retirement Planning and Investment and Saving option.

The only thing permanent in life is change. Time changes. People change. So does life.

Every one expects life to be much better tomorrow than it is today. Tomorrow, every one

hopes to fulfill all their dreams and aspirations. For this, an effective personal financial

planning is essential for every person. Financial planning includes:-

• Investment Planning: To make wealth grow

• Cash Flow Planning: To provide for assets and meet the periodic cash

requirements

• Tax Planning: To save on taxes and increase income

• Insurance Planning: To protect yourself, family and your assets

• Children's Future Planning: To give children a financially secure future

• Retirement Planning: Because retirement is a time to relax, not to get worried

Future is uncertain. When one is investing, volatility and inflation are part of the planning.

With a Financial plan, you should be able to do the following:

Set and prioritise your life goals

Take stock of your existing finances and the role they will play in meeting the

goals as also whether the current set of investments are the right ones for you.

Identify the right investment instruments including how much insurance and/or a

contingency reserve should you have to take care of your dependents.

Track your investments and Set milestones of execution and review

Children’s Future Planning

http://www.bajajcapital.com/financial-planning/investment-planning/investment_planning.php

http://www.bajajcapital.com/financial-planning/cash-planning/introduction.php

http://www.bajajcapital.com/financial-planning/tax-planning/tax-planning.php

http://www.bajajcapital.com/financial-planning/insurance-planning/importance.php

http://www.bajajcapital.com/financial-planning/children-planning/children-planning.php

http://www.bajajcapital.com/financial-planning/retirement-planning/retirement-planning.php

http://www.bajajcapital.com/financial-planning/investment-planning/investment_planning.php

http://www.bajajcapital.com/financial-planning/cash-planning/introduction.php

http://www.bajajcapital.com/financial-planning/tax-planning/tax-planning.php

http://www.bajajcapital.com/financial-planning/insurance-planning/importance.php

http://www.bajajcapital.com/financial-planning/children-planning/children-planning.php

http://www.bajajcapital.com/financial-planning/retirement-planning/retirement-planning.php



All parents want to give the best possible upbringing to their children. This includes good

education and security, in case of any eventuality. The purpose of Children's Future

Planning is to create a corpus for foreseeable expenditures such as those on higher

education and wedding, and to provide for an adequate security cover during their

growing years. Children's Future Planning acquires added importance because children's

education and wedding are high priority life goals, which can neither be postponed nor

can there be a compromise on the amount.

There are many products which you can use to achieve the above objectives. For

example, he could suggest a Children's Future Plan offered by any good insurance

company, to build a corpus for your child's higher education, and provide for a security

cover in the event of the parent's unfortunate demise. Children's plans are also available

under unit-linked option. Being unit-linked, they offer access to investments in all kinds

of asset classes - equity, debt and cash.

Kotak Child Plan

Kotak Headstart Child Plans

Kotak Child Advantage Plan

Retirement planning

Retirement is a reality for every working person. Most young people today think of

retirement as a distant reality. However, it is important to plan for post-retirement life if

anyone wish to retain their financial independence and maintain a comfortable standard

of living even when there are no longer earning. This is extremely important. Retirement

Planning acquires added importance because of the fact that though longevity has

increased, the number of working years haven’t. There are two situations where money is

needed at old age.

Living too long

Living Death

Kotak Retirement Plan



Kotak Long Life Wealth Plus

Kotak Second Innings Plan

Kotak Capital Multiplier Plan

Kotak Long Life Secure Plus

Kotak Guaranteed Pension Builder

Kotak Retirement Income Plan

At the child stage and old age stage of life, people need more economic security and

safety. For this, they invest money in various forms. Insurance plans are the one among

the various form of investment which make future secure and better at the time of

retirement and for children’s education and marriage. There are various plans provided

by Kotak Life insurance which makes the future secure and better.

Problem Statement:-

The research problem which lies here is “To manage the future uncertainty and

expectancy of people through effective financial planning with the help of insurance

plans at the time of retirement and for children’s future.” There are various stages in the

life of a person. In Child stage and old age stage in the life of a person, he/she need more

security because there is higher uncertainty in the future. Now-a-days, financial planning

is very much essential and insurance planning is the main part of it. Insurance plans

provided by various life insurance companies in the form of retirement plan and child

plan help to manage future expectancy and uncertainties.

Objective:-

To understand the concept of financial planning and analyze the financial plans

made by a customer of insurance company for their better future.

To analyze the match between life insurance policy given by Kotak Life insurance

and financial planning of their customers.



To determine the various factors which effect the financial planning of an

insurance customer for their retirement and children’s education.

To study the method for calculating the right amount of investment in insurance

by a person for future.

Scope:-

Functional Area: Finance

Time of Study: 45 days

Geographical Area Of Study: Northern, western and central Delhi.

Focus of study:

The main focus of the study is the financial planning done by an insurance company’s

customer for making their life’s future better and secure and retirement plans and child

plans provided by Kotak Life insurance. With the help of questionnaire, information

about customers is collected in the form of primary data and with the help of company’s

website and brouchers information about various plans provided by company is collected

and both are analysed to match the financial planning and company’s plans. There are

various consultants and advisors who provide their expertise and tools to calculate right

amount of insurance at various stages. This study also focuses on these tools.

Relevance of study:

There are various studies which have done previously on financial planning by a

corporate but the concept of personal financial planning is completely ignored AND there

are very less studies on this aspects. Financial planning includes all aspects like

consumption, saving, investment and insurance and it has a great relevance in the life of

all people for making life better and secure. Due to uncertainity in life’s future, planning

for future is essential.



CHAPTER - II REVIEW OF LITERATURE:With the help of various books, journals and internet, the review of concepts and theories

and review of previous research finding is taken place.

Some previous research on marketing strategies is also studied.

Some book are also reviewed of “Insurance and Risk Management” to clear concepts and

theories.

Financial planning is essential for better future but in India, there are very less people

who do the proper financial planning to make their future better and secure. The onlymain purpose of investment here is tax saving.

Things to consider while doing financial planning are:

Time Horizon and Goals: It is important to understand what individual’s goals are, and

over what time period they want to achieve their goals. Some goals are short term goals

those that people want to achieve within the year. For such goals it is important to be

conservative in one’s approach and not take on too much risk. For long term goals,

however, one can afford to take on more risk and use time to one’s advantage.

Risk Tolerance: Every individual should know what their capacity to take risk is. Some

investments can be more risky than others. These will not be suitable for someone of a

low risk profile, or for goals that require being conservative. Crucially, one’s risk profile

will change across life’s stages. As a young person with no dependants or financial

liabilities, one might be able to take on lots of risk. However, if this young person gets

married and has a child, person will have dependants and higher fiscal responsibilities. So

persons approach to risk and finances cannot be the same as it was when they were

single.

Liquidity Needs: When does money is needed to meet the goal and how quickly one can

access this money. If investment is made in an asset and expects to sell the asset to supply

funds to meet a goal, then it needs to be understood how easily one can sell the asset.



Usually, money market and stock market related assets are easy to liquidate. On the other

hand, something like real estate might take a long time to sell.

Inflation: Inflation is a fact of the economic life in India. The bottle of cold drinks that is

brought today is almost double the price of what would be paid for ten years ago. At

inflation or slightly above 4% per annum, a packet of biscuits that costs Rs 20 today will

cost Rs. 30 in ten years time. Just imagine what the cost of buying a car or buying a home

might be in ten years time! The purchasing power of money is going down every year.

Therefore, the cost of achieving goals needs to be seen in what the inflated price will be

in the future.

Need for Growth or Income: As person make investments think about what is required,

whether capital appreciation or income. Not all investments satisfy both requirements.

Many people are buying apartments, but are not renting them out even after they take

possession. So, this asset is generating no income for them and they are probably

expecting only capital appreciation from this. A young person should usually consider

investing for capital appreciation to take advantage of their young age. An older person

however might be more interested in generating income for themselves.

The insurance companies try to come out with new and innovative products which make

life secure and better. Now-a-days, there are various child plans and retirement plans

available in the market.

Way to plan:

Don't buy insurance just because your neighbour bought it. Buy insurance because you

need it.

Understand your financial goals. Once you know what your aim is, you will be in a better

position to choose the type of insurance you need - protection, savings, investment or

retirement.

Different insurance policies have different covers. Make sure your financial advisor

presents you with a list of recommendations, including the types of policies and benefits.

Read them thoroughly to be aware of what your policy covers.



The amount of insurance coverage you need depends on factors such as the number of

dependants, debts or mortgages, lifestyle and investment needs. Insurance cover should

be to such an extent that in case of one's demise, his / her dependents are able to maintain

the same lifestyle as they used to have before the unfortunate event occurred.

With insurance, we transfer the risk to another party. That party bears the risk that you

are protecting yourself against. This risk may be death, disability, sickness or an accident.

However, the party assuming the risk does not accept the risk without compensation. As a

result, premiums are charged. The party assuming the risk receives premiums from a

large group and is able to provide coverage to the whole group because the odds are that

not everyone in the group will suffer the particular risk.

Insurance is important to any personal finance decision. Many events can wipe out assets

which have been accumulated over a lifetime. Medical expenses, automobile accidents,

natural disasters and legal liability suits are instances that can require a significant

amount of resources. Individuals typically do not want to accept the risk that these events

may not occur nor are they willing to self-insure against these risks. Therefore, we seek

insurance and insurers are willing to provide coverage.

With a large population and the untapped market area of this population insurance

happens to be a very big opportunity in India. Today it stands as a business growing at

the rate of 15-20% annually. Together with banking services, it adds about 7 percent to

the country’s GDP. In spite of all this growth statistics of the penetration of the insurance

in the country is very poor. Nearly 80% of Indian populations are without life insurance

cover and the health insurance. This is an indicator that growth potential for the insurance

sector is immense in India.

ABSTRACT OF PREVIOUS RESEARCH

TOPIC: Financial Planners and Investment Advisors

About 35,000 US companies with combined annual revenue of about $200 billion

provide financial planning and investment advice to individuals and businesses. Large

companies include Ameriprise Financial, Charles Schwab, and units of diversified

http://www.marketresearch.com/product/display.asp?productid=2665763&xs=r

http://www.marketresearch.com/product/display.asp?productid=2665763&xs=r



financial services companies such as Morgan Stanley. The industry is concentrated: the

50 largest companies account for about half of revenue.

Demand is driven by consumer income and wealth and demographics. The profitability

of individual firms depends largely on effective marketing. Large companies have some

advantages in providing expertise in a wider range of investment options, and they may

be able to charge lower fees. Small companies can compete successfully by providing

better service and advice.

Financial planners help customers put together a plan to manage their financial resources;

investment advisors suggest specific investments. About 70 percent of industry revenue

comes from providing services to individuals. Financial planners help individuals form a

plan that may include debt, asset, college, retirement, estate and tax planning, and may

periodically check with the client to see how well the plan is being followed. Much of the

planning revolves around an income and spending budget, with advice about the types of

financial investments suitable for the client. For wealthy individuals, and for

organizations such as trusts, estates, and charitable foundations, financial planners offer

more comprehensive and detailed planning, often of a tax-sensitive nature, and frequently

recommend specific investments.

Note-Worthy Contributions In The Field

For effective financial planning, Bajaj Capital give the concept of 360 degree financial

planning which includes all type of planning related to money to make present and future

better and it also provides various tools and experts to find right amount of investment at

every stages of life and also helps in choosing the right form of investment .

360° Financial Planning is a unique software-based simulation that takes a holistic view

of your life-long financial needs and charts a personalised investment strategy to help you

meet them. Broadly, it involves:

• Identifying your current financial status Listing and prioritising your goals

Creating a sound investment plan to achieve them

• Monitoring the plan to facilitate swift corrective action, if needed



360° Financial Planning is based on the premise that every individual has certain basic

financial needs that are expressed at various stages of life (getting married, buying assets

like homes, vehicles, or providing for your children's education and wedding). With the

help of 360°Financial Planning, you can prepare yourself well in time for all these goals.

Some other financial institutions and insurance companies also provide tools like

mathematical calculator and help of financial advisors to make financial planning of a

customer.

CHAPTER - III CURRENT SCENARIO

Insurance has a long history in India. Life Insurance in its current form was introduced in

1818 when Oriental Life Insurance Company began its operations in India. Life



Insurance was the first to be nationalized in 1956. Life Insurance Corporation of India

was formed by consolidating the operations of various insurance companies. The process

of opening up the insurance sector was initiated against the background of Economic

Reform process which commenced from 1991. For this purpose Malhotra Committee was

formed during this year who submitted their report in 1994 and Insurance Regulatory

Development Act (IRDA) was passed in 1999. Resultantly Indian Insurance was opened

for private companies and Private Insurance Company effectively started operations from

2001.

With a large population and the untapped market area of Insurance happens to be a very

big opportunity in India. Today it stands as a business growing at the rate of 15-20 per

cent annually. Together with banking services, it adds about 7 per cent to the country’sGDP .In spite of all this growth the statistics of the penetration of the insurance in the

country is very poor. Nearly 80% of Indian populations are without Life insurance cover

and the Health insurance. This is an indicator that growth potential for the insurance

sector is immense in India. It was due to this immense growth that the regulations were

introduced in the insurance sector and in continuation “Malhotra Committee” was

constituted by the government in 1993 to examine the various aspects of the industry.

The key element of the reform process was Participation of overseas insurance companies

with 26% capital. Creating a more efficient and competitive financial system suitable for

the requirements of the economy was the main idea behind this reform.

The competition LIC started facing private players were threatening to the existence of

LIC .since the liberalization of the industry the insurance industry has never looked back

and today stand as the one of the most competitive and exploring industry in India. The

entry of the private players and the increased use of the new distribution are in the

limelight today. The use of new distribution techniques and the IT tools has increased the

scope of the industry in the longer run. The Insurance sector in India governed by

Insurance Act, 1938, the Life Insurance Corporation Act, 1956 and General Insurance

Business (Nationalisation) Act, 1972, Insurance Regulatory and Development Authority

(IRDA) Act, 1999 and other related Acts.





Product Innovations

Distribution Network

Customer Education and Services

Modern Marketing Approach

MAJOR PLAYERS IN LIFE INSURANCE INDUSTRY

There are 22 players in the life insurance industry in Inida which are as follows:

Life Insurance Corporation of India

HDFC Standard Life Insurance Company Ltd.

Max New York Life Insurance Co. Ltd.

ICICI Prudential Life Insurance Company Ltd.

Kotak Mahindra Old Mutual Life Insurance Limited

Birla Sun Life Insurance Company Ltd.

Tata AIG Life Insurance Company Ltd.

SBI Life Insurance Company Limited .

ING Vysya Life Insurance Company Private Limited

Bajaj Allianz Life Insurance Company Limited

Metlife India Insurance Company Ltd.

Future Generali India Life Insurance Company Limited

IDBI Fortis Life Insurance Company Ltd.

Reliance Life Insurance Company Ltd

Aviva Life Insurance Company India Ltd.

Sahara India Life Insurance Company Ltd

Shriram Life Insurance Company Ltd.

Bharti AXA Life Insurance Company Ltd. DLF Pramerica Life Insurance Company Ltd.

Aegon Religare Life Insurance Company Ltd.

Star Union Dai-ichi Life Insurance Company Ltd.

Canara HSBC Oriental Bank of Commerce Life Insurance Company Ltd.



The insurance agents still remain the main source through which insurance products are

sold. The concept is very well established in the country like India but still the increasing

use of other sources is imperative. At present the distribution channels that are available

in the market are listed below.

• Direct selling

• Corporate agents

• Group selling

• Brokers and cooperative societies

• Bancassurance

Customers have tremendous choice from a large variety of products from pure term (risk)

insurance to unit-linked investment products. Customers are offered unbundled products

with a variety of benefits as riders from which they can choose. More customers are

buying products and services based on their true needs and not just traditional moneyback

policies, which is not considered very appropriate for long-term protection and savings.

There is lots of saving and investment plans in the market. However, there are still some

key new products yet to be introduced - e.g. health products.

The rural consumer is now exhibiting an increasing propensity for insurance products. A

research conducted exhibited that the rural consumers are willing to dole out anything

between Rs 3,500 and Rs 2,900 as premium each year. In the insurance the awareness

level for life insurance is the highest in rural India. The perceived benefits of buying a

life policy range from security of income bulk return in future, daughter's marriage,

children's education and good return on savings, in that order, the study adds.



First Progress Report, AKANKSHA JAIN, 05817003909

Documents