hdfc final print.doc

PREFACE

People are a company’s most important assets. They can make or break the

fortunes of a business. In today’s highly competitive business environment

placing the right people in the right position is very critical for the success of

any organization. The recruitment and selection decision is of prime

importance as it is the vehicle for obtaining the best possible person-to-job

fit that will, contribute significantly towards the company's effectiveness. It

is also becoming increasingly important, as the company evolves and

changes, that new recruits show a willingness to learn, adaptability and

ability to work as part of a team. The recruitment & selection procedure

ensures that these criteria are addressed.

In this project I have studied recruitment and selection process of HDFC

standard life insurance and attempted to provide some ways so as to make

recruitment more effective and to reduce the cost of hiring an employee.

The efforts in this report have been aimed at articulating and systematizing

the definite conceptual core of recruitment and selection for developing

human resources planning. The report illustrates a collection of different

deliberate steps and criteria for selecting the employee in a particular

organization. Research based on several distinct approaches to identify and

develop best way to select the right people at the right place. During the

training period i have studied deeply the process of hiring in HDFC standard

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life insurance and did a swot analysis of HDFC standard life insurance to

find out the existing shortcomings and potential threats and thereby

recommended suggestions. The text for the report is the result of the process

of research and effort in the HDFC recruitment phenomena.

Swati Chaddha

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ACKNOWLEDGEMENT

First and foremost I would like to express my profound gratitude and

esteemed regards to my faculty guide Mrs. Zinnia Mukherji for her support

and guidance. She has been constant source of strength and inspiration and

deserves my heartfelt gratitude and thanks.

I would like to acknowledge the support and cooperation to Mr. Ajay kumar

as HR manager, he guided me in this project and shown keen interest and

provided valuable guidance to complete this work and provide experience.

Swati Chaddha

DECLARATION

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I Swati Chaddha here by that research work presented in this project report

entitled “RECRUITMENT AND SELECTION IN HDFC SLIC ” for the

fulfillment of the award of master business administrative from Uttar

Pradesh technical university, Lucknow is based on my work during the

summer training in the “HDFC standard life insurance company”. The

project embodies the result of original work and studies carried out by me

and the contents of the project do not from the basis for the award of any

degree to me or to any body else.

Swati Chaddha

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BONAFIDE CERTIFICATE

Certified that this project report titled “RECRUITMENT AND

SELECTION IN HDFC SLIC ” is the bonafide works of “SWATI

CHADDHA” who carried out the project work under my supervision.

SIGNATURE SIGNATURE

HAED OF THE MANAGEMENT FACULTY IN CHARGE

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CONTENT

INTRODUCTION

Linkage of recruitment and selection to the human resource

acquisition………………………….……….………………. 11

Objective..................................................................................23

Scope & Limitation in report …………….………………….23

Methodology………………………………….……...............26

HDFC Standard life insurance

Mission and vision …………………………….…………….31

Banking and Insurance…………………….………………... 32

Company profile in HDFC…………………….….………. 47

SWOT Analysis of HDFC……………………...……… 57

Recruitment and selection

Survey for job profile (sales department)…………….…… 64

Data analysis………………………………………. …….. 73

Fact and findings………………………………………….. 93

Suggestion and recommendation…………………………. 95

Conclusion………………………………………………… 98

Bibliography………………………………………………. 99

Appendix…………………………………………………. 100

EXECUTIVE SUMMARY

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Organizations are always on the look out for good candidates who have the

requisite skills to perform varied jobs. Shortage of skilled manpower, today

threatens the very competitive positioning of many corporations and the

situation is not getting any better. Thus to sort out the talented is a multi step

procedure which is performed through the following steps.

Screening

Aptitude test

Interviews

Verification of documents

Whole criteria used to take approximately 2 to 3 days maximum and

usually can be thoroughly finished within in one day. After the selection of

right candidates at right place at right time, organization provided offer letter

and appointment letter.

Report based on the findings and facts of duration of the recruitment

and Selection, stability and retaintion of the employee. To evaluate data

related to

these facts, questionnaire are prepared and filled with the sample size

30.

Some other key issues being faced by organizations are –

Majority of the people hired turn out to be under performers.

Cost of replacing manpower is anything between 2 to 3 times

his or her salary.

The cost of consistently failing to attract and retain good talent

– including declining productivity, morale, culture and reputation - is

inestimable.

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Each vacant position in any organization costs a huge amount

to it.

Getting the best talent, and keeping the talent you have is

becoming increasingly and intensely competitive Most corporate officers say

that the biggest constraint to pursuing growth opportunities is talent

TRAINING POLICY:

Optimum utilization of existing resources and enhancing productivity.

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Bridge the skill gap –function & managerial arising from career growth &

technological advancements.

Develop multi skilled work force for over all business

perspective process orientation & flexibility in there development.

Nature talent to develop leadership across all levels of the

organization.

provide multiple learning opportunities to employees & help

them realize their full potential

Prepare the organization to anticipate &lead change.

Promote the work ethos, which emphasize performance

orientation, participation, & innovation. Management is committed to

provide opportunities to all employees, time &resources to develop their full

potential.

INTRODUCTION

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Human Resource is a basic need of any work to be done. According to

ARTHUR LEWIS:

“There are great differences in development between countries

which seem to have roughly equal resources, so it is necessary to

enquire into the difference in human behaviors”

The project report is all about recruitment and selection process that’s an

important part of any organization. Recruitment highlights each applicant’s

skills, talents and experience. Their selection involves developing a list of

qualified candidates, defining a selection strategy, identifying qualified

candidates, thoroughly evaluating qualified candidates and selecting the

most qualified candidate. It is said if right person is appointed at right place

the half work has been done. In this project I have tried to cover all the

important point that should be kept in mind while recruitment and selection

process and have conducted a research study through a questionnaire that I

got it filled with all the sales departments’ employees of the HDFC standard

life insurance and tried to find out which methods and various other

information related to recruitment and selection and tries to come to a

conclusion at what time mostly the manpower planning is don’t , what the

various method used for recruiting the candidates and on what basic the

selections is done.

HDFC has a well-articulated equal opportunity policy, which lays strong

emphasis on hiring of individuals irrespective of age, race, caste or gender.

As a best practice in recruitment.

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LINKAGE OF RECRUITMENT AND SELECTION TO THE

HUMAN RESOURCE ACQUISITION

Recruitment process is concerned to search and identify the human

manpower and perfect human resources. Selection can be conceptualized in

terms of either choosing the fit candidates or rejecting the unfit candidates,

or a combination of both.

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Manpower planning and Job analysis

Recruitment

Selection

Placement

CONCEPT OF RECRUITMENT SELECTION

After the identification of need for the number and types of the personnel as

indicated by manpower planning and job analysis, the step is to acquire

these personnel this involve location of such personnel, motivating them to

offer themselves for consideration for selection, and selecting the personnel

who fit with organizational and job requirements. The whole process is

known as recruitment and selection.

RECRUITMENT;

Recruitment is the process concerned with the identification of sources from

where the personnel can be employed and motivating them to offer

themselves for employment. Werther and Davis have defined this as follows:

“Recruitment is the process of finding and attracting capable applicants for

employment. The process begins when new recruits are sought and ends

when their applications are submitted. The result is pool of applicants from

which new employees are selected.”

SELECTION:

Selection can be conceptualized in terms of selecting the appropriate

candidates, or deny the inappropriate candidates. Selection involves both

because it picks up the fits and rejects the unfits. In facts, in Indian context,

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there are ore candidates who are rejected than those who are selected in most

of the selection processes.

Therefore, sometimes, it is called a negative process in contrast to positive

programme of recruitment. A formal definition of selection has been

provided by Stone as follows:

‘selection is the process of differentiating between applicants in order to

identify (and heir) those with a great likelihood of success in job.”

Selection process assumes and rightly so, that there are more number of

candidates available than the number of candidates actually selected. These

candidates are available through recruitment process.

To ensure that our recruitment process is fair and consistent, all candidates

who are successful at the exams are invited for a capability based interview.

Interviews are based against capabilities, required for each position for

which the candidate is interviewed for. A capability or competency is an

ability described in terms of skills & behaviors that are essential to

effectively perform within a job.

Apart from the educational and academic capability, the chief attributes

HDFC SLI looks out for in a candidate are as follows:

We look out for a candidate who values Integrity

Has a zeal for Excellence

Is focused on Results

Is Self driven and Enthusiastic

Is a good Learner and Team Player

Is dedicated to Customer Satisfaction

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RECRUITMENT PROCEDURE

Normally, an organization can fill up its vacancies either through promotion

of people available in the organization or through the selection of people

from outside. Thus, there can be two sources of supply of manpower-

external and internal. For all recruitment, a preliminary question of policy

considers the extent to which it wills emphasis external and internal sources.

The question is not of ‘either or’ but is one of relative importance of both

sources because every organization has to fill up some through promotion

and, in the some way, every organization has to fill up some vacancies

through outsiders. Selection of particular source of manpower supply

depends on several factors numerated below:

The policy of taking candidates from outside and inside affects the attitude

and action of the people in the organization. Filling up the position through

internal promotion has a favorable reaction among employees. They are

likely to associate themselves with the organization as they see their future

secured in the organization through promotion. However, this may result

into mediocre performance as a guarantee of promotion itself will bring

complacency.

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The level of socialization required and time taken for that determines the

inside or outside source of recruitment. If the socialization process for an

organization operating in a particular industry takes substantial time, it can

prefer internal source of recruitment.

People selected from outside take time to socialize themselves with an

organization. For certain jobs, this process may take considerably longer

time. For example, marketing executive of a consumer product company

will take less time in socialization in another consumer product company but

more time in capital goods industry. Same is the case with production people

but finance people may take same time in spite of the differences and

similarities of organization. The need for originality and new ideas also

affect new policy. The organizations which place high importance on these

factors go for outsides sources. Similarly, the organizations which grow

through diversification give more importance to outside sources as existing

people may not be fully equipped to handle new business.

These factors are considered while determining the sources of recruitment.

While vacancies through internal sources can be filled up either through

promotion or transfer, recruiters tend to focus their attention on outside

sources. Normally following outside sources are utilized for different

position;

Advertisement: Advertisement is most effective means to search potential

employees from outside the organization. Employment advertisement in

journals, newspaper, bulletins, etc, is quite common in our country. By

means of advertisement, the organization able to communicate its

requirement of people some of whom may be its prospective employees. An

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advertisement contains brief statement of the nature of the jobs, the type of

people required, and procedure for applying for these jobs.

On campus recruitment: many organization conduct preliminary search of

prospective employees by conducting interviews at the campuses of various

institutes, universities and colleges. This source is quite useful for selecting

people to the post pf management trainees, technical super supervisor,

scientist and technicians. The organizations hold preliminary interviews on

the campus on the predetermined date and candidates found suitable are

called for further interviews at specified place.

Labour union: in many organizations, lobour unions are used as source of

manpower supply, though at the lower levels. The idea behind employee

recommendations as a source of potential applicants is that present

employees may have specific knowledge of the individuals who may be their

friends, relatives, or acquaintances. If the present employees are reasonably

satisfied with their jobs, they communicate their feelings to many people in

their communities.

Employment agencies: many organizations get the I formation about the

prospective candidates through employment agencies. In our country two

types of employment agencies are operating:

Public employment agencies

Private employment agencies

Though both of these perform activities regarding

employment suggestions to their clients, often they differ

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considerably:

Public employments agencies- there are employment exchange

run by the government all most in all district. The employment seekers get

themselves registered with these exchanges. Normally such exchanges

provide candidates for lower positions like semi skilled and skilled workers,

and lower level operatives like clerks, juniors’ supervisors, etc.

Private employment agencies- there are consultancy and

employment agencies like ABC consultants, personnel and productivity

services etc., which provide employment services particularly for selecting

higher level and middle level executives. These agencies also take total

function of recruiting and selecting personnel on behalf of various

organizations. They charge fee for this purpose.

Deputation: Many organizations take people on deputation from other

organization. Such people are given choice either to return to their original

organization after a certain time or to opt for present organization. At the

initial development of public sector organizations, this source is quite

common for filling managerial vacancies in these organizations. People from

civil and defense services were put on deputation in these organizations.

Organizations promoted by various industrial groups also us this source to

fill higher managerial positions. People working in one organization are

deputed in another belonging to same industrial house.

Employee recommendations: employee recommendations can be considered

to employee personnel particularly at the lower levels. The idea behind

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employee recommendation as a source of potential applicants is that the

present employees may have specific knowledge of the individuals who may

be their friends, relatives and acquaintances. If the present employees are

reasonably satisfied with their jobs, they communicate their feeling to many

person in their communities.

Gate hiring: the concept of gate hiring is to select people who approach on

their own for reemployment in the organization. This happens mostly in the

case of unskilled and semi skilled workers. Gate hiring is quite useful and

convenient at the initial stage of the organization when large number of

people may be required in the organization. It can be made effective by the

prompt disposal of applications, by providing information about

organization policy and procedure regarding such hiring and providing

facilities to such gate callers.

It is not that particular organization will utilize all sources of employ people

of all types. Some of sources are more useful for particular category of

employees. For example, advertisement and deputation are more useful for

employing managerial personnel. Similarly labour union and gate hiring are

more suitable to employ labour and unskilled person. Utilization of various

sources of recruitment should be evaluated in terms of the degree of success

in obtaining competent people. Post record in this context may be useful

indicators. Since there are different category of employee to be selected,

different sources of recruitment are used. For example, according to the

study by Rudravasavaraj, a public sector undertaking in heavy engineering

recruited its non-supervisory staff through:

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employment exchange

external advertisement

internal advertisement

central training institute

introduction by liaison officer of the undertaking

deputation of personnel

transfer from other public sector undertaking

According to this study, the major sources of recruitment in public sector

undertaking are in the following order:

casual caller or employment seeker

newspaper advertisement

schedule cast and schedule tribes

employment exchanges

other public undertaking

internal advertisement

displaced persons

relatives and friends of present employees

employee recommendation

colleges and universities

The major sources of recruitment for private sector of organizations are:

advertisement

employment exchanges

relatives and friends

casual caller

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employee recommendation

SELECTION PROCEDURE:

A selection process involves a number of steps. The basic idea is to solicit

maximum possible information about the candidates to ascertain their

suitability for employment. Since the type of information required for

various positions may vary, it is possible that the selection process may have

different steps for various positions. For example, more information is

required for the selection of the managerial personnel as compared to

workers. Similarly, various steps of selection process may be different for

various organizations because their selection practices may differ. For

example, some organization conduct selection tests of various types while

others may not use these. However standard selection processes have

following steps:

1. Screening of application: Prospective employees have to fill up some sort

of application form. These forms have variety of information about

applicants like their personal bio-data, achievement and experience etc. such

information is used to screen the applicants who are found to be qualified for

the consideration of the employments. The information may also be used to

keep permanent records of those persons who are selected. Based on the

screening of application, only those candidates are called for further process

of selection who are found to be meeting to the job standards of the

organization. When the numbers of applicant meeting the job standards far

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exceed the actual requirement, the organizations decide a suitable number of

candidates who will be called for further selection process.

2. Selection test: many organization s hold different kinds of selection tests

to know more about the candidates or to reject the candidates who can not be

called for interview, etc. selection tests normally supplement the information

provided in the application forms. Such form may contain factual

information about candidates. Selection test may give information about

their aptitude, interest, personality, etc., which can not be known by the

application forms.

3. Interview: Selection test are normally followed by personal interview of

candidates. The basic idea is to find out overall suitability of candidates for

the jobs. Its also provide opportunity to give relevant information about

organization to the candidates. In many cases, interview of preliminary

nature can be conducted before the selection process.

For example, in the case of campus selection, preliminary interview is held

for short listing the candidates for further process of selection.

4. Checking of references: Many organizations ask the candidates to provide

that names of referees from whom more information about the candidates

can be solicited. Such information related to character, working, etc. the

usual referees may be previous employers, person associated with the

educational institutions from where the candidates received the education, or

other person of prominence who may be aware of the candidates’’ behavior

and ability. In our country, references are not given adequate importance

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because of their biasness but these can give very useful information which

may not be available otherwise.

5. Physical examination: Physical examination carried out to ascertain

physical standards and fitness of prospective employees. The practice of

physical examination varies a great deal both in terms of coverage and

timing. While many organizations do not carry physical examination at all,

other carries on a very comprehensive basis. Some organizations only have

general check up the applicant to find the major physical problem which

may come in the way of effective discharge of the duties. In the on test of

timing also, some organization locate the physical examination near the end

of the selection process, others place it relatively early in the process.

6. Approval by appropriate authority: on the basis of the steps, suitable

candidate are recommended for selection by the selection committee or

personnel department. Though such a committee or personnel department

may have authority to select the candidates finally, often it is staff authority

to recommend the candidates for selection to the appropriate authority.

Organization may designate the various authorities for approval of final

selection of candidates for different categories of candidates. Thus for top

level of managers board of director may be approving authority; for lower

level, even functional heads concerned may be approving authority. In

university, it may be syndicate executive communities. When the approval is

received, the candidates are informed about their selection and asked to

report for duty to specified persons.

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7. Placement: after all the formalities are completed, the candidates are

placed on their jobs are based in the probation basis. The probation period

may range from three months to two years. During this period, they are

observed keenly, and when they complete this period successfully, they

become the permanent employees of the organization.

OBJECTIVE

To study the various sources of recruitment which is followed in

HDFC STANDARD LIFE INSURANCE

To analyze the average time taken in recruitment and selection by

different department in HDFC standard life insurance.

To study the procedure involve in HDFC standard life insurance to

recruit and select people.

To analyze the turnover percentage of HDFC standard life insurance.

SCOPE AND LIMITATION

The project work that needs to be accomplished to deliver a

product, service, or result with the specified features and functions. This

report includes quantitative and qualitative data relating on recruitment and

selection. Project report used to focus on the recruitment and selection of the

“Right people at right place at right time”.

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The main scope of project report is HR Planning, which is applied

properly in

the field of HR Management, it would assist to address the following

questions

It helps to decide the number of staff which is required in

the organization.

It helps to decide the skills and abilities of the candidates

i.e. required in the Company.

It recommended the best utilization of the available human

resources.

It also provides the idea to organization to retain the

employee.

LIMITATIONS

(Problems Faced During the Project)

“Life is full of complexities, diversities and adventures”.

The more you live, the more your find yourself grasped in these

complexities of life. To be a successful person, one has to cross the hurdles

of these complexities and believe that they are adventures which are to be

explored. Similarly, following were the set of hurdle or limitations which

were faced by me before I could arrive at the successful completion of this.

1. Time consuming activity:-

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HRP collects information from all departments, regarding demand and

supply of personnel. This information is collected in detail and each and

every job is considered. Therefore the activity takes up a lot of time.

2. Expensive process:-

The solution provided by process of Recruitment and Selection incurs

expense. E.g. convinces, overtime, paper work etc. trainee has to spend

money in carrying out the activity. Hence we can say the process is

expensive.

3. Attitude of top management:-

Much top management adopts a conservative attitude and is not ready to

make support. Due to shortage of time and busy schedule they usually

unable to give proper support.

4. As most of the employee were busy in their work, it was difficult to meet

them individually for an interview.

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METHODOLOGY

The way in which research is conducted to adopt different research

strategy

employed and the research instruments utilised (and perhaps

developed) in

the pursuit of a goal – the research objective(s) - and the quest for the

solution

of a problem - the research question. The purpose of this is to:

expand the research strategy, including the research methodologies

which are adopted;

introduce the research instruments that we have developed and

utilised in the pursuit of our goals.

SOURCES OF DATA

Data constitute the foundation for statistical analysis. When statistical data

are collected and analyzed it is usually in a context of population and their

characteristics. It should be noted that a population is the totality of the units

understudy and a population characteristics is an attribute of a population

unit.

Data are of mainly two types based on collection method:

1. Primary data; primary data are obtained by study specifically designed to

full fill the problem at hand. Such data are original in character and are

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generated in large number of survey conducted mostly by researcher himself

or institutional researcher bodies.

Direct personal interviews: under this method of collecting data there is a

face to face contact with the person from whom the information is to be

obtained (known as respondents or informants). The interviewer asked them

questions pertaining to the survey and collects the desired information.

Indirect oral interview: under this method of collecting data investigator

contacts third parties called witness. Those are capable of supplying the

necessary information. The method is generally adopted in those cases

where the information to be obtained is of the complex nature and the

informants/ respondents are not inclined respond is approach directly.

Information from correspondents: under this method the investigator

appoints local agent or correspondents in different places to collect

information. The corresponded collects and transmits the information to the

central officer where the data are processed.

Mail questionnaire method: under this method a list of questions pertaining

to the survey (known as questionnaire) is prepared and sent to the various

informants by post. The questionnaires contain questions and provide space

for answer. Request is made to informants through a public through a public

letter to fill up the questionnaire and sent it back within specified time.

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Schedules sent through enumerates: another method pf collecting

information is that of sending schedule through the enumerate rod

interviewer. The enumerator contact the informants get replies to the

questions contained in the schedule and fill then in their own handwriting in

the questionnaire form.

2. Secondary data: data which are not originally collected but rather obtained

from some sources are known as secondary data. In the most of the studies

the investigator finds it imperceptible to collect first hand information to the

related issues and as such he makes the use of data collected by other. There

is vast amount published information from which statistical studies and fresh

statistics are constantly in state of production.

SAMPLE SIZE

This is the number of elements that is contained in the sample of the

analyzed data set. Percentages and projections in the analysis are calculated

based on this case weight. Sample sizes are used to identify the data

tolerance range that has to be considered when evaluating the results. Both

outweighed and weighted cases should be displayed next to each other.

The sample size of a statistical sample is the number of observations that

constitute it. The number of participants in the trial. The intended sample

size is the number of participants planned to be included in the trial, usually

determined by using a statistical power calculation. The percentage of the

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individuals (or groups) originally randomized for whom outcome data could

not be obtained.

For the proper evaluation of methodology of recruitment and selection the

sample size considered is 30 with the format of questionnaire of 20

questions. Thus number of participant accumulated through the sales

department of HDFC Standard Life Insurance and also from the Religare.

METHOD OF DATA COLLECTION

In data collection, collection of the data self using methods such as

interviews and questionnaires. And other might be used, such as

 Survey method

Personal interview with candidates

In depth conversation with the placement agency

Secondary data:

Study of recruitment policy

Websites

Published articles

Research methodology used

Study of recruitment and selection at ICICI Prudential Life

Insurance by the manual provided by the HR department

Web sites

Journals

Magazines

Books

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Here mainly questionnaire has prepared with 20 question framed.

A questionnaire is a research instrument consisting of a series

of questions and other prompts for the purpose of gathering information

from respondents. Questionnaires have advantages over some other types

of surveys in that they are cheap, do not require as much effort from the

questioner as verbal or telephone surveys, and often have standardized

answers that make it simple to compile data.

INSTRUMENT USED

Instrument is defined as a tool to identify the data based result for successful

process of recruitment and selection. These instruments are helpful to

accumulate data and information about the selection of the candidates and

the view of the participants. Thus during the training period that instruments

are manual as well as electronic. These instruments are ;

Telephone

Paper record

Computer aided, software etc.

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HDFC STANDARD LIFE

INSURANCE

MISSION:

Our mission is to be “a World Class Indian Bank”, benchmarking ourselves

against international standards and best practices in terms of product

offerings, technology, service levels, risk management and audit &

compliance. The objective is to build sound customer franchises across

distinct businesses so as to be a preferred provider of banking services for

target retail and wholesale customer segments, and to achieve a healthy

growth in profitability, consistent with the Bank’s risk appetite. We are

committed to do this while ensuring the highest levels of ethical standards,

professional integrity, corporate governance and regulatory compliance.

Vision:

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By 2010 we will enable economics and social changes. Increasing to branch

in over all India, and development to banking structure and financial service.

Setup to global business environment

BANKING AND INSURANCE

INTRODUCTION TO INDIAN BANKING INDUSTRY:

Without a sound and effective banking system in India, it cannot have a

healthy economy. The banking system of India should not only be hassle

free but it should be able to meet new challenges posed by the technology

and any other external and internal factors.

For the past three decades India’s banking system has several outstanding

achievements to its credit. The most striking is its extensive reach. It is no

longer confined to only metropolitans or cosmopolitans in India. In fact,

Indian banking system has even reached to the remote corners of the

country. This is one of the main reasons of India’s progress.

The Government’s regular policy for Indian bank since 1969 has paid rich

dividends with the nationalization of many private banks of India.

Private Banks in India

All the banks in India were earlier private banks. They were founded in the

pre-independence era to cater to the banking needs of the people. But after

nationalization of banks in 1969 public sector banks came to occupy

dominant role in the banking structure. Private sector banking in India

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received a fillip in 1994 when Reserve Bank of India encouraged setting up

of private banks as part of its policy of liberalization of the Indian Banking

Industry. Housing Development Finance Corporation Limited (HDFC) was

amongst the first to receive an 'in principle' approval from the Reserve Bank

of India (RBI) to set up a bank in the private sector.

BANKING & INSURANCE

India is one of the fastest developing economies amongst the third world

countries. To achieve such a feat is no child's play. Whether it is

development in the agricultural sector or the growth of industries, rise in IT

or increase in the rate of real estate, nothing would have been possible

without intricate planning and management of funds.

This section provides links to the website of some of the major banks &

insurance companies in the public sector in India.

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BANK

DEFINITION

The definition of a bank varies from country to country. See the relevant

country page (below) for more information. Under English common law, a

banker is defined as a person who carries on the business of banking, which

is specified as:

conducting current accounts for his customers

paying cheques drawn on him, and

Collecting cheques for his customers.

In most English common law jurisdictions there is a Bills of Exchange Act

that codifies the law in relation to negotiable instruments, including cheques,

and this Act contains a statutory definition of the term banker: banker

includes a body of persons, whether incorporated or not, who carry on the

business of banking' (Section 2, Interpretation). Although this definition

seems circular, it is actually functional, because it ensures that the legal basis

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for bank transactions such as cheques does not depend on how the bank is

organized or regulated.

The business of banking is in many English common law countries not

defined by statute but by common law, the definition above. In other English

common law jurisdictions there are statutory definitions of the business of

banking or banking business. When looking at these definitions it is

important to keep in minds that they are defining the business of banking for

the purposes of the legislation, and not necessarily in general. In particular,

most of the definitions are from legislation that has the purposes of entry

regulating and supervising banks rather than regulating the actual business

of banking. However, in many cases the statutory definition closely mirrors

the common law one. Examples of statutory definitions:

"banking business" means the business of receiving money on current or

deposit account, paying and collecting cheques drawn by or paid in by

customers, the making of advances to customers, and includes such other

business as the Authority may prescribe for the purposes of this Act;

(Banking Act (Singapore), Section 2, Interpretation).

"BANKING BUSINESS" MEANS THE BUSINESS OF

EITHER OR BOTH OF THE FOLLOWING:

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1. Receiving from the general public money on current, deposit, savings or

other similar account repayable on demand or within less than [3 months] ...

or with a period of call or notice of less than that period.

2. Paying or collecting cheques drawn by or paid in by customers

Since the advent of EFTPOS (Electronic Funds Transfer at Point Of Sale),

direct credit, direct debit and internet banking, the cheque has lost its

primacy in most banking systems as a payment instrument. This has led

legal theorists to suggest that the cheque based definition should be

broadened to include financial institutions that conduct current accounts for

customers and enable customers to pay and be paid by third parties, even if

they do not pay and collect cheques.

A bank is a financial intermediary that accepts deposits and channels those

deposits into lending activities, either directly or through capital markets. A

bank connects customers with capital deficits to customers with capital

surpluses.

Banking is generally a highly regulated industry, and government

restrictions on financial activities by banks have varied over time and

location. The current sets of global bank capital standards are called Basel II.

In some countries such as Germany, banks have historically owned major

stakes in industrial corporations while in other countries such as the United

States banks are prohibited from owning non-financial companies. In Japan,

banks are usually the nexus of a cross-share holding entity known as the

keiretsu.

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The oldest bank still in existence is Monte dei Paschi di Siena,

headquartered in Siena, Italy, which has been operating continuously since

1472

INTRODUCTION OF THE INSURANCE INDUSTRY

OVERVIEW:

The story of insurance is probably as old as the story of mankind. The same

instinct that prompts modern businessmen today to secure themselves

against loss and disaster existed in primitive men also. They too sought to

avert the evil consequences of fire and flood and loss of life and were

willing to make some sort of sacrifice in order to achieve security. Though

the concept of insurance is largely a development of the recent past,

particularly after the industrial era – past few centuries – yet its beginnings

date back almost 6000 years.

The first two decades of the twentieth century saw lot of growth in insurance

business. From 44 companies with total business-in-force as Rs.22.44 crore,

it rose to 176 companies with total business-in-force as Rs.298 crore in

1938. The Insurance Act 1938 was the first legislation governing not only

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life insurance but also non-life insurance to provide strict state control over

insurance business.  

Some of the important milestones in the life insurance business in India are:

1818: Oriental Life Insurance Company, the first life insurance company on

Indian soil started functioning.

1870: Bombay Mutual Life Assurance Society, the first Indian life insurance

company started its business. 

1912: The Indian Life Assurance Companies Act enacted as the first statute

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 to by the Insurance Act

with the objective of protecting the interests of the insuring public.

1956: 245 Indian and foreign insurers and provident societies are taken over

by the central government and nationalized. LIC formed by an Act of

Parliament, viz. LIC Act, 1956, with a capital contribution of Rs. 5 crore

from the Government of India.

The General insurance business in India, on the other hand, can trace its

roots to the Triton Insurance Company Ltd., the first general insurance

company established in the year 1850 in Calcutta by the British.

Some of the important milestones in the general insurance business

in India are:

1907: The Indian Mercantile Insurance Ltd. set up, the first company to

transact all classes of general insurance business.

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1957: General Insurance Council, a wing of the Insurance Association of

India, frames a code of conduct for ensuring fair conduct and sound business

practices.

1968: The Insurance Act amended to regulate investments and set minimum

solvency margins and the Tariff Advisory Committee set up.

1972: The General Insurance Business (Nationalization) Act, 1972

nationalized the general insurance business in India with effect from 1st

January 1973.

With largest number of life insurance policies in force in the world,

Insurance happens to be a mega opportunity in India. It’s a business growing

at the rate of 15-20 per cent annually and presently is of the order of Rs 450

billion. Together with banking services, it adds about 7 per cent to the

country’s GDP. Gross premium collection is nearly 2 per cent of GDP and

funds available with LIC for investments are 8 per cent of GDP.

Yet, nearly 80 per cent of Indian population is without life insurance cover

while health insurance and non-life insurance continues to be below

international standards. And this part of the population is also subject to

weak social security and pension systems with hardly any old age income

security. This itself is an indicator that growth potential for the insurance

sector is immense.

A well-developed and evolved insurance sector is needed for economic

development as it provides long term funds for infrastructure development

and at the same time strengthens the risk taking ability. It is estimated that

over the next ten years India would require investments of the order of one

trillion US dollar.

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The Insurance sector, to some extent, can enable investments in

infrastructure development to sustain economic growth of the country.

India has come a full circle from being an open competitive market to

nationalization and back to a liberalized market again. Tracing the

developments in the Indian insurance sector reveals the 360 degree turn

witnessed over a period of almost two centuries.

Present Scenario:

The Government of India liberalized the insurance sector in March 2000

with the passage of the Insurance Regulatory and Development Authority

(IRDA) Bill, lifting all entry restrictions for private players and allowing

foreign players to enter the market with some limits on direct foreign

ownership.

The opening up of the sector is likely to lead to greater spread and deepening

of insurance in India and this may also include restructuring and revitalizing

of the public sector companies. In the private sector 14 life insurance and 8

general insurance companies have been registered. A host of private

Insurance companies operating in both life and non-life segments have

started selling their insurance policies..

Life Insurance Market:

The Life Insurance market in India is an underdeveloped market that was

only tapped by the state owned LIC till the entry of private insurers. The

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penetration of life insurance products was 19 percent of the total 400 million

of the insurable population. The state owned LIC sold insurance as a tax

instrument, not as a product giving protection.

Most customers were under- insured with no flexibility or transparency in

the products. With the entry of the private insurers the rules of the game

have changed.

The 12 private insurers in the life insurance market have already grabbed

nearly 9 percent of the market in terms of premium income. The new

business premiums of the 12 private players have tripled to Rs 1000 crore in

2002- 03 over last year. Innovative products, smart marketing and

aggressive distribution. That's the triple whammy combination that has

enabled fledgling private insurance companies to sign up Indian customers

faster than anyone ever expected.

Indians, who have always seen life insurance as a tax saving device, are

now suddenly turning to the private sector and snapping up the new

innovative products on offer.

The private insurers also seem to be scoring big in other ways- they are

persuading people to take out bigger policies. Buoyed by their quicker than

expected success, nearly all private insurers are fast- forwarding the second

phase of their expansion plans.

 Major Insurance Players:

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Licenses have been issued for the following companies

Ø      ICICI Prudential Life Insurance Company Limited

Ø      HDFC Standard Life Insurance Company Limited

Ø      Birla Sun Life Insurance Company Limited

Ø      TATA AIG Life Insurance Company Limited

Ø      Max New York Life Insurance Company Limited

Ø      SBI – Cardiff Life Insurance Company Limited

Ø      ING Vysya Life Insurance Company Limited

Ø      Bajaj Allianz Life Insurance Company Limited

Ø      MetLife Life Insurance Company Limited

Ø      Aviva Life Insurance Company Limited

Ø      AMP Sanmar Life Insurance Company Limited

Ø      Sahara India Life Insurance Limited

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Ø      Sri Ram Life Insurance Limited

Protection of the interests of policyholders:

IRDA has the responsibility of protecting the interest of insurance

policyholders. Towards achieving this objective, the Authority has taken the

following steps:

IRDA has notified Protection of Policyholders Interest Regulations 2001 to

provide for: policy proposal documents in easily understandable language;

claims procedure in both life and non-life; setting up of grievance redressal

machinery; speedy settlement of claims; and policyholders' servicing.

The Regulation also provides for payment of interest by insurers for the

delay in settlement of claim.

The insurers are required to maintain solvency margins so that they are in a

position to meet their obligations towards policyholders with regard to

payment of claims.

It is obligatory on the part of the insurance companies to disclose clearly the

benefits, terms and conditions under the policy. The advertisements issued

by the insurers should not mislead the insuring public.

All insurers are required to set up proper grievance redress machinery in

their head office and at their other offices.

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The Authority takes up with the insurers any complaint received from the

policyholders in connection with services provided by them under the

insurance contract.

INSURANCE:

The business of insurance is related to the protection of the economic values

of assets. Every asset has a value. The asset would have been created

through the efforts owner. The asset is valuable to the owner, because he

except to get some benefits from it. It is benefit because it meets some of his

needs. The benefit may be an income or in some other form. In the case of

factory or cow, the product generated by it is sold and income is generated.

In the case of motor car, it provides comfort and convenience in

transportation. There is no direct income.

Every asset expected to last for certain period of time during which it will

provide the benefits. After that the benefit may not be available. There is a

life time for a machine in a factory or cow or a motor car. None of them will

last forever. The owner is aware of this and he case so manage his affair that

by the end of that period or life time, a substitute is made available. Thus he

makes sure that benefit is not lost. However the asset may get lost earlier.

An accident or some other unfortunate event may destroy it or make it

incapable of giving the benefits. The planned substitute would have been

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ready. There is an adverse and unpleasant situation. It promises to pay to the

owner or beneficiary of the asset, a certain sum if the losses occur.

BRIEF HISTORY OF INSURANCE:

Insurance is known to exist in some form or other since 3000 BC. The

Chinese traders, traveling treacherous river rapids would distribute their

goods among several vessels, so that the loss from any one vessel being lost

would be partial and shared, and not total. The Babylonian trader would

agree to pay additional sums to lenders, as the price for writing off the loans,

in case of shipment being stolen. The inhabitants of Rhodes adapted the

principal of ‘general average’, whereby, if goods are shipped together, they

would bears the losses in proportion, if loss occurs, due to jettisoning during

distress. (Captains of ship caught in storms, would through some of the

cargo to reduce the weight and restore balance. Such throwing away is called

jettisoning) the Greeks had started benevolent societies in the late 7th

century AD, to take care of the funeral and families of the members who

died. The friendly societies of England were similarly constituted. The

Greek fire on the London in 1966, in which more than 13000 houses were

lost, gave boost to insurance and the first time fire insurance company,

called the fire office, was started in 1680.

The origin of insurance business as in vogue at present is traced to the

Lloyd’s coffee house in London, agreed to share the losses to their goods

while being carried by ships. The losses used to occur because of pirates

45

who robbed on the high seas or because of the bad weather spoiling the

goods or sinking the ship. In India, the insurance began in 1818 with life

insurance being transacted by an English company, the oriental life

insurance Co. Ltd... The first Indian insurance company was the Bombay

mutual assurance society Ltd, formed in1870 in Mumbai, the united in

Chennai, the National Indian Cooperative in Kolkata.

Later, were established the cooperative assurance in Lahore, the Bombay life

(originally called the Swadeshi Life), the Indian mercantile, the New India

and the Jupiter in Mumbai and the Lakshmi in New Delhi. These were all

Indian companies started as a result of the swadeshi movement in the early

1900s. by the year 1956, when the life insurance business was nationalized

and the Life Insurance Corporation of India (LIC) was formed on 1st

September 1956, there were 170 companies and 75 provident find societies

transacting Life insurance business in India. After the amendments to the

laws in 1999, the L.I.C. did not have the privilege of doing life insurance

business in India. By 31.8.2007, sixteen new life insurers had been

registered and were transacting life business in India.

In law and economics, insurance is a form of risk management primarily

used to hedge against the risk of a contingent, uncertain loss. Insurance is

defined as the equitable transfer of the risk of a loss, from one entity to

another, in exchange for payment. An insurer is a company selling the

insurance; an insured or policyholder is the person or entity buying the

insurance policy.

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The insurance rate is a factor used to determine the amount to be charged

for a certain amount of insurance coverage, called the premium. Risk

management, the practice of appraising and controlling risk, has evolved as

a discrete field of study and practice.

The transaction involves the insured assuming a guaranteed and known

relatively small loss in the form of payment to the insurer in exchange for

the insurer's promise to compensate (indemnify) the insured in the case of a

large, possibly devastating loss. The insured receives a contract called the

insurance policy which details the conditions and circumstances under which

the insured will be compensated.

COMPANY PROFILE IF HDFC:

Standard Life Group (Standard Life plc and its subsidiaries):

The Standard Life group has been looking after the financial needs of

customers for   over 180 years. It currently has a customer base of around 7

million people who rely on the company   for their insurance, pension,

investment, banking and health-care needs.

Its investment manager currently administers £125 billion in assets. It is a

leading pensions provider in the UK, and is rated by Standard & Poor's

as 'strong' with a rating of A+ and as 'good' with a rating of A1 by Moody's

Standard Life was awarded the 'Best Pension Provider' in 2004, 2005 and

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2006 at the Money Marketing Awards, and it was voted a 5 star life and

pensions provider at    the Financial Adviser Service Awards for the last 10

years running.

The '5 Star'    accolade has also been awarded to Standard Life Investments

for the last 10 years,    and to Standard Life Bank since its inception in 1998.

Standard Life Bank was    awarded the 'Best Flexible Mortgage Lender' at

the Mortgage Magazine Awards in    2006

HISTORY:

HDFC Standard Life Insurance Co. Ltd was incorporated on 14th august

2000. It is a joint venture between Housing Development Finance

Corporation Limited (HDFC Ltd.) India and UK based Standard Life

Company. Both the joint venture partners being one of the leaders in their

respective areas came together in this 81.4:18.6 joint Venture to form HDFC

standard life insurance company limited.

The MD and CEO of HDFC Standard Life Mr. Deepak Satwalekar, has

given the company new directions and has helped the company achieve the

status it currently enjoys. HDFC Standard Life brings to you a whole range

of insurance solutions be it group or individual or NAV services for

corporations; they can be easily customized as per specific needs.

HDFC Standard Life Insurance India boasts of covering around 8.7 lakh

lives by March'2007. The gross incomes standing at a whopping Rs. 2, 856

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crores, HDFC Standard Life Insurance Corporation is sure to become one of

the leaders and the first preference for any life insurance customer.

The Bank assurance partners of HDFC Standard Life Insurance Co Ltd are

HDFC, HDFC Bank India Limited, Union Bank of India, Indian Bank, Bank

of Baroda, Sarawat Bank and Bajaj Capital.

The premium payment options available to the customers vary from online

payment to direct desk payments at the HDFC Standard Life Branches, by

courier services or in drop boxes provided. You can also pay by ECS or

Automatic Debit System or credit cards or standing instruction mandate.

HDFC Standard Life Insurance Company is a customer oriented corporation

and aim at complete customer satisfaction.

The lapsation and renewal policy of HDFC Standard Life are clearly defined

on the official website. Online renewal forms are also available. For any

change in personal details like the contact details or the nominee of the

policy or policy benefits, online servicing is also available. Even the claim

procedure has been simplified since affect of the loss life is irreparable and

is thus fully understandable at HDFC Standard Life. A completely hassle-

free process has been formulated to provide maximum convenience.

HDFC Standard Life first came together for a possible joint venture, to enter

the Life Insurance market, in January 1995. It was clear from the outset that

both companies shared similar values and beliefs and a strong relationship

49

quickly formed. In October 1995 the companies signed a 3 year joint venture

agreement.

Around this time Standard Life purchased a 5% stake in HDFC, further

strengthening the relationship.

The next three years were filled with uncertainty, due to changes in

government and ongoing delays in getting the IRDA (Insurance Regulatory

and Development authority) Act passed in parliament. Despite this both

companies remained firmly committed to the venture.

In October 1998, the joint venture agreement was renewed and additional

resource made available. Around this time Standard Life purchased 2% of

Infrastructure Development Finance Company Ltd. (IDFC). Standard Life

also started to use the services of the HDFC Treasury department to advise

them upon their investments in India.

Towards the end of 1999, the opening of the market looked very promising

and both companies agreed the time was right to move the operation to the

next level. Therefore, in January 2000 an expert team from the UK joined a

hand picked team from HDFC to form the core project team, based in

Mumbai. 

Around this time Standard Life purchased a further 5% stake in HDFC and a

5% stake in HDFC Bank.

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In a further development Standard Life agreed to participate in the Asset

Management Company promoted by HDFC to enter the mutual fund market.

The Mutual Fund was

Launched on 20th July 2000.

Incorporation of HDFC Standard Life Insurance Company Limited:

The company was incorporated on 14th August 2000 under the name of

HDFC Standard life insurance Company limited.

Their ambition from the beginning was to be the first private company to re-

enter the life insurance market in India. On the 23rd of October 2000, this

ambition was realized when HDFC Standard Life was the first life company

to be granted a certificate of registration.

HDFC are the main shareholders in HDFC Standard Life, with 81.4%, while

Standard Life owns 18.6%. Given Standard Life's existing investment in the

HDFC Group, this is the maximum investment allowed under current

regulations.

HDFC and Standard Life have a long and close relationship built upon

shared values and trust. The ambition of HDFC Standard Life is to mirror

the success of the parent companies and be the yardstick by which all other

insurance companies in India are measured.

HDFC Standard Life Insurance Company Limited is one of India's leading

private life insurance companies offering a range of individual and group

insurance solutions. It is a joint venture between Housing Development

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Finance Corporation Limited (HDFC Ltd), India's leading housing finance

institution and Standard Life plc, the leading providers of financial services

in the United Kingdom.

HDFC Ltd. as on December 31, 2007 holds 72.38 per cent of equity in the

joint venture. HDFC Standard Life's Product portfolio comprises solutions,

which meet various customer needs such as Protection, Pension, Savings,

and Investment. Customers have the added advantage of customizing the

Plans, by adding optional benefits called riders, at a nominal price. The

company currently has 21 retail and 6 group products in its portfolio.

HDFC Standard Life maintains very high professional standards during

product offerings by providing sound financial advice, efficient post-sale

service, and immaculate financial security. Ongoing training for

conventional products, and specialized training, for unit-linked products, for

its financial consultants, has also helped its customers choose the product,

best suited for their needs.

4HDFC Standard Life operates across more than 726 cities and towns of the

country supported by its strong network of more than 1, 45,000 Financial

Consultants. HDFC Standard Life also has more than 383 corporate agents

and other sales intermediaries including banks for distribution of insurance

products.

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PRODUCT RANGE AND VARIETY

At HDFC Standard Life, we offer a bouquet of insurance solutions to meet

everyneed. We cater to both, individuals as well as to companies looking to

providebenefits to their employees. This section gives you details of all our

products. We have incorporated various downloadable forms and product

details so that you can make an informed choice about buying a policy.

Forindividuals, we have a range of protection, investment, pension and

savingsplans that assist and nurture dreams apart from providing protection.

You can choosefrom a range of products to suit your life-stage and needs.

For organizations we have a host of customized solutions that range from

Group Term Insurance, Gratuity, Leave Encashment and Superannuation

Products. These affordable plans apart from providing long term value to the

employees help in enhancing goodwill of the company.

We at HDFC Standard Life realize that not everyone has the same kind of

needs. Keeping this in mind, we have a varied range of Products that you

can choose from to suit all your needs. These will help secure your future as

well as the future of your family.

TYPES OF PRODUCT

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1. Protection

a. term assurance plan

b. loan cover term plan

A TERM ASSURANCE PLAN

Under this plan a some assured is payable in case of death the life assured

during the term of the contract. One can choose the lump sum that would

replace the income lost to one’s family in the unfortunate event of one’s

death. Since no participating plan is pure risk cover plan, no enefit are

payable of the survival to the end of the term of the plan.

b. Loan cover term assurance plan

this plan provide lump sum on the unfortunate death of the life assured

during the term of the plan.the lump sum will be the decreasing percentage

of the sum assured. As the outstanding loan decreases as per the loan

schedule, the cover the policy decreases as per the policy schedule. Since

this is non participating, risk is there,no benefit are payable on survival to

the end of policy.

2. Investment

Single premium whole of life

Single premium whole of life is well suited to the long term investment

need. This participating plan offer following benefits:

A sound investment

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Money invested with profit with fund. The fund aim to provide stable and

long term growth.

Flexibility of term

Even after choosing the policy we can decide on the policy term. for 4 weeks

any of the 10th, 15th, 20th and subsequent five year anniversaries, we can

choose to receive the sum assured plus any attaching bonus plus.

3. Pension plan

a. personal pension plan

b. unit linked personal plan

Personal pension :

This participating plan is basically a saving contract, which

is designed to provide an income for life from retirement. It does this

by providing a national plan.

Unit linked personal plan:

The unit link personal plan is basically a insurance contact

which is designed to provide the retirement income for the life.

4. savings plan

a. unit linked endowment plan

b. money back

c. endowment plan

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d. unit link youngster plan unit linked endowment plan

this unit linked endowment plan is an insurance policy that is

designed to pay a lump sum amount on a maturity or in

earlier death. The unit linked endowment plan also gives the option of

additional protection against common critical illness, as well as

additional protection if death is as the result of an accident.

Money back

-payment of case lump sum, each of which is proportion of

basis sum assured, at five year interval during the term if policy.

- on survival up to maturity a payment equal to the sum basic

assured plus any bonus.

Endowment plan

It provide financial support to the family by way of lump sum

Payment in case of unfortunate death of life assured.

It provide lump sum payment to the life assured on survival up

to maturity.

Unit kinked youngter plan

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SWOT ANALYSIS OF HDFC;

Strengths

HDFC Bank is second largest private bank in India, having 1412 Branches

and over 3275 ATMs across 528 cities at March end 2009.

Net profit grows on YOY basis by 41% from Rs. 1,590 crore as on 2007-08

to Rs.2, 245 crore as on 2008-09

Total no. of employs closed to 80,000 people. That is less than SBI but more

than ICICI bank(in the private sector, only larger group such as the Tata,

Birla’s, or reliance employee. more )

Cost to income ratio at 53.6% was one of the highest amongst private Bank

in FY09(It was 45% AXIS& ICICI Bank’s)

At March end 2009 Total Bank deposit is 44% of the bank deposit based

(better than SBI’s 42%, and ICICI Bank’s 25% only)

The CBoP merger has led to ante worth accretion of about Rs.1,34 crore v/s

CBoP’s Net assets of approximately Rs. 2,090 crore.

Stock of NPAs shot up by 119 % to Rs.1, 988 crore during the further

quarter ended.

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Interest from investments income 20.42 % and interest from advances make

up for over 61.85 % income in 2008-09.

Profit after tax for financial year 2009 was Rs. 2,245 crore

Total advances was Rs.63,427 crore as on 2007-08 increase to Rs,9,8883 as

on 2008- 09.

Total deposits was Rs, 1, 00,769 crore as on 2007-08, increase to Rs, 1,

42,813 crore as on 2008-09

Capital Adequacy Ratio (CAR) grows on YOY Basis by 13.60 % as on

2007-08 to 15.10 % as on2008-09

There are 40 branches posted anent profit of Rs, 2,100 crore for 2008-09 by

comparison

Younger generation of customers targeted through IT enabled product and

service;

Online trading of shares

Online fund transfer,

online payments of taxes

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phone banking

internet banking

E-shopping

WEAKNESS:

In this booming market where we need to capture the mind of customer by

providing them with new global facility and service should be available

everywhere .if we talk about SBI it have 36 ATMs UBI 18 ATMs where as

HDFC Bank has only 4 ATMs and 3 Branch.

Some customer are not satisfied about banking service and facilities

It have not goods channels in rural and semi- urban area it was totally cover

to city and multi-city area. But nationalized bank cover total area.

It have only 1,412 branches across only 528 cities in India compare to other

competitors bank it is very few and does not cover to over all India.

HDFC Bank has ICICI,IDBI,AXIS,SBI,PNB,BOB,UBI, Ing-Vesya,Standard

Charter , ABN-AMRO,and CITY BANK,as competitors which are more

powerful in terms of secured market.

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OPPORTUNITY:

Where all banks re facing problems Lehman brothers, Bank of America ,

Merrill lynch was insolvency all over world economic condition is very

bad .market was be decrease day-by-day. HDFC is a bank which is strong

enough to run properly in this competitive market.

As being a private sector bank it is fresh from all kinds of rumors o it has got

a new channel to makes its reputation before customer.

For example many international banks have faced a tragedy of being defame

in the view of customers.

HDFC Bank can service is very goods compare the other private sector and

nationalized bank. It can provide the easy loan facility to the customer and

a make a proper goodwill.

It has nice chance to spread its branches over small city and sub-urban over

of India.

Domestic consumption continues to drive growth. India is expected to be

least impacted due to the global slowdown due to its diverse economic base

and favorable demographics. The Company has focused on direct to

consumer lending, innovative structuring of credit solutions, strong

processes and prudent risk management. The company follows a micro

market approach to geographic segmentation of markets.

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The company plans to expand its product portfolio by adding General

Insurance services and Investment! Savings Products such as sale of Mutual

funds to its portfolio.

Threat:

Irrational pricing, lenient credit norms in the past have led to increase in

Non-performing assets across the retail lending space.

The markets will continue to mature leading to rising expectation from

consumers and your Company’s growth will depend on its ability to

differentiate its products! Services to compete effectively.

Growth of the company’s asset book, quality of assets and ability to raise

funds depends significantly on the economy. Unfavorable events in the

Indian economy can affect consumer sentiment. Changes in Government

policy, regulatory framework could impact the company’s operations.

Recently many private banks have faced a great losses and some

international banks was insolvency due to bad economic condition .and now

they will be in the market with different strategy so now to look for the

innovation and try to find out the weakness of these banks.

Still HDFC Have not got a very good service channels so it, needs to

improve its service and increase the no. of its channels HDFC Bank staff is

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very few according to customer service compare to other banks so it need to

increase our staff and open new branch recently.

AWARDS AND ACCOLADES:

May, 2008 Received PC Quest Best IT Implementation Award 2008 HDFC

Standard Life received the PC Quest Best IT Implementation Award 2008

for Consultant Corner, the applications for its financial consultants,

providing centralized control over a vast geographical spread for key

business units such as inventory, training, licensing, etc. Read more about

the ‘Consultant Corner’ tool in the ‘HDFC SL in news’ section. HDFC

Standard Life has won the PC Quest Best IT Implementation Award for two

years consequently. Last year, the company received the award for Wonders,

its path-breaking implementation of an enterprise-wide workflow system.

Silver Abby at Goafest, March, 2008 HDFC Standard Life's radio spot for

Pension Plans won a Silver Abby in the radio writing craft category at the

Goafest 2008 organized by the Advertising Agencies Association of India

(AAAI). The radio commercial ‘Pata nahin chala’ touched several changes

in life in the blink of an eye through an old man’s perspective. The objective

was drive awareness and ask people to invest in a pension plan to live life to

the fullest even after retirement, without compromising on one’s self-

respect.

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Laadli Media Award 2007 HDFC Standard Life received Laadli Media

Award 2007 for its 'Big car' TV commercial. It showed how a daughter

wants to be more responsible towards her family and asks her dad to upgrade

to a bigger car by offering him the extra money required to buy the car.

HDFC Standard Life received this award for two years consecutively. In

2006, it won for the 'Papa' TV commercial, which challenged the stereotype

parents saving only for their son's education or daughter's wedding.

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RECRUITMENT AND

SELECTION

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CONCEPT

There is difference between recruitment and selection so far as technique

involved is concerned. Recruitment techniques are not very intensive,

requiring high skills. As against this, in selection process, highly specialized

techniques are required. Therefore, in the selection process, only personnel

specific skills like expertise in using selection test, conducting interviews,

etc, are involved.

Since recruitment and selection are two interrelated steps in the process of

manpower acquisition, they differ in terms of their outcome. In outcome of

recruitment is application pool which becomes input for selection process.

The outcome of selection process is in the form of finalizing candidates who

will be offered jobs.

65

66

SURVEY FOR JOB PROFILE (SALES DEPARTMENT)

The use of tests in selection is so wide spread that these may be

classified in various steps they may have different objectives and different

attributes.

Searching criteria:

Searching criteria means to collect a mass of appropriate candidates through

the following reference:

-Consultancy:

consultancy is an organization which used to provide the number of

candidates. Those candidates, who are eligible for respective post,

previously collect their CVs to the consultancy to job reference.

Consultancies used to bind contact to the organization for sending

candidates for respective vacant post required in the organization.

Consultancies job is to give line-up (condition of number of candidates

applicable for job). Line-up should be updated everyday through proper

calling and contacts during the process of recruitment.

-Advertisement:

Advertisement is as usually is to provide route to organization for

candidates. Advertisement is a perfect mode to disseminate the knowledge

of job profile.

-Employee reference:

Employees of organization refer candidates for available required posts.

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-Campus selection:

Organizations select candidates from educational and professional institute

to full the requirement of recruitment. Those candidates are selected through

the process of screening and interview.

HDFC PROFILE FOR THE POST OF SALES

DEVELOPMENT MANAGER;

Company profile: The Company started in 2001 as a joint venture between

the HDFC Bank and the Standard Life Insurance Company. The HDFC

Bank has a 74 % stake in the company where as the Standard Life Insurance

Company has only 26 % stake in the company.

The company’s net income for the ending 2008 -09 was over Rs. 5,500

crores and the company has more than 27 lakh policy holders. It provides

both Life as well as General Insurance services. The company’s

advertisement “Sar Utha Ke Jiyo” has been ranked among India’s 60

Glorious Advertising Moments.

Job profile: The candidate would be required to meet the monthly sales

target as set by the company from time to time. He would also be required to

recruit new Insurance agents in accordance with the business plan. Develop

training programs, training process for the new recruits and set business

targets among the Agents, review these targets & consistently raise them so

than the said target is achieved.

Qualifications: The candidate must be a graduate in any course with a

minimum of 50 % marks. He must be a quality leader, an excellent

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communicator in English as well as local regional Languages.

Experience: 1 to 5 years of experience of sales in a financial services

industry. Candidates with consistent good record in sales or sales

management role would be preferred.

Pay Scale: Rupees 2, 00,000 to 2, 25,000

Person to be contacted: Mr. Dimpy Dudeja

Email Address: [email protected]

Contact Number: 09872992554

Location of Work: Panipat, Jammu, Jalandhar, Ludhiana, Pathankot,

Kurukshetra, Ambala, Amritsar, Chandigarh, Hisar, Karnal, Rajkot,

Ahmedabad, Warangal, Kurnool, Anantapur, Hyderabad / Secunderabad,

Mysore, Bengaluru/Bangalore, Guntur, Rajahmundry, Vijayawada,

Visakhapatnam, Moradabad, Madurai, Trichy, Mumbai, Mumbai Suburbs,

Navi Mumbai, Belgaum

No. of positions: 32 position in total one each at every location

How to apply: Send your update Resume to the above mentioned Email

Address, shortlisted candidates would be called for a personal interview.

Website: http://www.hdfcinsurance.com

-CV screening:

CV screening is the process to short out the candidates on their academic

profile etc. The goal of the resume screening process is to select the top

candidates that the recruiter will contact for the first round of

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interviews. Screening resumes will help you determine which candidates to

move forward in the interview and selection process by comparing their

qualifications to the minimum position requirements.

Narrowing the list of candidates that apply for your position can be

challenging, especially if there are many qualified applicants. The first step

with selecting appropriate candidates is to screen the cover letter (if

applicable) and resume of each applicant. The resume will tell you what the

candidate has done, but not how well he/she did it.

-Application Evaluation:

The Human Resources department evaluates all incoming applications,

against prerequisite abilities and skills set for all current openings. All

applications are kept based on strengths and specialization, for future

reference.

-Selection test:

As such type of test held in ‘HDFC standard life’ is said as HAT (HDFC

aptitude test). HAT’s content is numerical and assumption based questions,

which is divided in three part of test paper. HAT must be solved with in the

half an hour. In such procedure qualified candidates are preceded for further

steps i.e., interview.

-Capability based Interview:

An interview is a conversation between two or more people (the interviewer

and the interviewee) where questions are asked by the interviewer to obtain

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information from the interviewee.

-Checking of references and documents:

As such in selection and checking procedure for the post SDM in the ‘HDFC

standard life’ all required documents are collected in the brochure which

said to be Joining Kit.

Joining kit contain all authentic information and some application form

about the candidates for joining the post after passing the interview, such

information and forms are as follows:

Documents related to qualification

Age proof

Experience letter

Salary slip

Address proof

Application forms

-Placement;

After all formalities are completed, the candidates are placed on their job

initially on probation basis. The probation period may range from three

months to two years. During this period they are observer keenly, and when

they complete this period successfully, they become the permanent

employee of the organization.

-Reply Letters:

At all stages of the process candidates are kept informed of the status of their

application with an email reply letter.

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-Job Offer:

If a candidate successfully reaches the final stage, a position offering is

made in conjunction with a competitive reward package.

Issuing of appointment letter and offer letter:

The procedure to issue offer letter and appointment letter is done by HR

manager of that institute. HR manager‘s job is to maintain MIS and

providing these letters. Now a day all the functions are properly maintained

by the use of software packages such as SAP.

Questionnaire: Analysis based on the data of questionnaire to

the recruitment and selection in HDFC SLIC AND

RELIGARE.(SAMPLE SIZE IS 30)

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1. What source your organizations adopt to select candidates?

Above

graph

shows that recruitment agency is most active organization for the better

compensation of recruitment and selection. Further it is followed by the

employee referral recruitment which is comparatively low in recruitment

agency.

2. How many stages are involved in selecting the candidate?

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Pie chart related to the query of days which used to spend on recruitment

and selection for a particular number of employees. Chart specifies that

mainly financial corporation in the field pf sales take mostly 2 days.

Increment in the days of selection depends on the condition.

3. Do your organization use any of the following tests during the process of

recruitment?

74

Test is an appropriate criterion to draw out eligibility among mass of the

candidates. It depends on the post which criteria is appropriate to select and

recruit. Thus for the post of the sales mostly personal interview is preferred

after written or aptitudes test.

4. How does your organization track the source of candidate?

75

Finding source of candidates is usually manual. Manual source refer an easy

and convincing way to find and sort out the candidates.

5. Apart from the HR Manager, who all from the other departments are

required to get involved in interviewing process?

76

F

or the post of sales like SDM, BDM etc usually the experience person

belong to the department of sales and sales development involve in the

process of recruitment and selection of sales employee. Further it is followed

by the HR department or HR manager of the corporation to examine and

utilize the resources for sales development.

6. What is the average time spent by sales dept. during recruitment (each

candidate)?

77

The value of time in business must be evaluated for the profit maximizations

and proper utilization of human resources. Thus a department should have to

take appropriate time for recruitment and selection. Above chart shows 20 to

30 min usually spends on the selection of each candidate.

7. What is the average time spent by HR dept. during recruitment (each

candidate)?

78

HR department plays a most important role during the recruitment and

selection. This is because it is useful to evaluate the capacity and human

range of mental and physical work in regard the position like sales. But

company used to spend maximum 45 to 50 percent time of HR department

during the whole process of selection.

8. What is the average time spent by Admin dept. during recruitment (each

candidate)?

79

Chart shows it is the maximum time which is spent on sales recruitments by

the admin department.

9. Do your organization follow different recruitments process for

different grades of employee?

80

Chart specifies that organization apply same criterion and common

techniques for recruitment and development.

10. What is the back out percentage of candidates after being offered?

81

Back out percentage reflect any fault in the procedure of recruitment and

selection. That’s why candidates could not be stayed. Chart shows maximum

is 1-5 and minimum is 10-15.

11. What percentage of candidates leave within the period of less than1- 3

month?

82

This is depend on the environment in the organization, it used to evaluate the

time duration of employees settle in the organization. Thus chart shows that

the working environment of the organization is moderately sufficient to

satisfy the employee i.e.upto 5% at maximum within 1 to 3 months.

12. What percentage of candidates leave within the period of less than3- 6

month?

83

Maximum capacity of the existing organization to sustain the employees

within 1 to 5 months is upto 5%.

13. What percentage of candidates leave within the period of less than 6-12

month?

84

Maximum capacity of the existing organization to hold the employees within

6 to 12 month is up to 5%.

14. Does the company reimburse the traveling cost incurred by the candidate

for appearing in the interview?

85

Chart shows maximum to time organization reimburse the traveling cost

incurred by the candidates for appearing in the interview i.e. maximum to

60%.

15. Do you take any technological support for the process of recruiting?

86

due to the support of high tech equipment the process of recruitment and

selection become faster. These are the telephone, video conferencing; online

support etc. although any equipment other than the telephone used to take

high cost thus maximum support is taken through the telephone i.e. 93.33%.

16. Are you aware of the concept of “Video Resume”?

87

On the account of the financial capacity still organizations and employees do

not aware about the video resume i.e. 96.67%. That may be costly for both

organization and candidates.

88

17. If the recruitment type is “Employee Referral” then how much special

privilege has to be paid to the one who has referred is sufficient?

It leads surety for the candidates’ capability for the organization, if any

selection exists through the employee referral. Thus priority to such type of

candidates’ maximum i.e. 53.33%

18. In how much time does the whole process generates results?

89

Screening, aptitude test, calling, recruiting etc take maximum 1 to 2 days for

selection of the candidates in the sales department.

90

19. Do you do the “Employment Eligibility Verification”? Yes/No

If yes, then, what method you take up to perform it?

This shows the employees tendency and awareness towards the knowledge

of job description and job profile. Maximum numbers of employee do

employments eligibility verification through internally.

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20. What kind of verifications you do?

Educational verification mostly preferred by the maximum employees for

employment verification of the post.

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FACTS AND FINDINGS

OUTCOMES OF RECRUITMENT AND SELECTION

PROCESS

The ultimate objectives of both recruitment and selection are to acquire

suitable candidates but their immediate objectives differ. The basic objective

of recruitment is to attract maximum number of candidates so that more

options are available the basic objective of selection is choose the best of the

available candidates.

Recruitment differs from selection in terms of process. Recruitment adopts

the process of creating application pool as large as possible and, therefore, it

is known as positive process. Selection adopts the process through which

more and more candidates are rejected and fewer candidates are selected or

sometimes not a single candidate is selected. Therefore, it is known as

negative process or rejection process.

HDFC SLI‘s recruitment policy is well structured and provides the company

with a competitive edge due to the following reasons:

The recruitment policy focuses on recruiting the best potential

people.

It ensures that every applicant and employee is treated equally

with dignity and respect.

It is an unbiased policy.

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It aids and encourages employees in realizing their full

potential.

It allows transparent, task oriented and merit based selection.

It abides by relevant public policy and legislation on hiring and

employment relationship.

It Integrates employee needs with the organizational needs.

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SUGGESTION

AND

RECOMENDATION

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SUGGESTION

The human resources are the most important assets of an organization. The

success or failure of an organization is largely dependent on the caliber of

the people working therein. THE RECRUITMENT POLICY of an

organization should be well planned and thus should be such so that it:

Reduces administration costs

Provides employees with job security

Encourage responsible trade unions

Provide suitable employment to handicapped, women and

minority group

Be flexible enough to meet the changing needs of the

organization

Works towards the growth and prosperity of the organizatsion.

After the study of “RECUITMENT AND SELECTION” I find that the

effective procedure of recruitment is most importance is every

organizational Management has to do more effective effort for continuous

success in the field of Service and financial sector.

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There is need to introduce online recruitment, maintain software for sources

of candidates to avoid postal and courier’s delays through which time of

processing becomes increase. There is need to increase in our human

resources.

Generally evaluation of employees on the job and off the job is necessary on

daily, weekly, & quarterly basis but still people are not much aware about

software involve in recruitment and selection procedure in our Management

in India. So there is need to improve the awareness and use to save the time

and save the budget, so that it matches the requirement and settlements in

the all type’s organizations.

Other than futures and options, other instruments like video conferencing,

online recruitment, and psychometric test options have to be introduced so

that area of human resource is broadened.

There is need to provide facility and training to the employee and candidates

in favors of technology.

In today's market, companies no longer compete just on price,

product and packaging. The real competition is for talent. And the

companies with best talent win. we work to enable our clients to gain a

recruiting advantage in the market through the application of sales and

marketing techniques, tools and methodologies.

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CONCLUSION

The project report involves the detailed profile of HDFC SLIC and what is

the process of agency recruitment in HDFC SLIC. This project report deals

with recruitment and selection process, which are basics should be known to

everybody in the insurance industry best considered approach especially

though not ethical but practical enough is pirating best employees of their

competitors. Project under the HDFC Standard Life Insurance deal with the

recruitment and selection as well as focus on the capacity of the retention of

the employee in the organization.

HDFC Standard Life Insurance follows the proper and appropriate steps and

rules to select e candidates for the post of SDM. It involves more than one

department during the procedure of recruitment and selection in sales

department. It’s another focus on the budget of the procedure which should

be maintained and under the limit.

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BIBILIOGRAPHY

RECRUITMENT AND SELECTION-

ADDITION BY L. M PRASAD

ADDITION BYASWATHAPPA K

WEBSITE VISITED-

www.google.com

www.hdfc.com

www.yahoo.com

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APPENDIXQuestionnaire

Questionnaire on Recruitment Process Outsourcing

QUESTIONNAIRE

Name –

Company’s name –

Designation –

Date-

Note – Please tick the appropriate option.

1. What source your organisation adopt to source candidates?

a. Employee referral

b. Campus recruitment

c. Advertising

d. Recruitment agencies

e. Job portals

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f. Other, pls specify –

2. How many stages are involved in selecting the candidate?

a. 1

b. 2

c. 3

d. 4

e. More

3. Do your organisatuon use any of the following tests during the process of

recruitment?

a. Written

b. Aptitude

c. Group Discussion

d. Personal Interview

e. Psychometric test

f. Other, pls specify –

4. How does your organization track the source of candidate?

a. Manual

b. Software

c.Online

d.Windows. Xls

5. Apart from the HR Manager, who all from the other departments are

required to get involved in interviewing process?

101

a. Sales

b. Administration

c. HR Executives

d. Other, pls specify –

6. What is the average time spent by sales dept. during recruitment (each

candidate)?

a. 10mins.

b. 10 to 20mins.

c. 20 to 30mins.

d. More

7. What is the average time spent by HR dept. during recruitment (each

candidate)?

a. 10mins.

b. 10 to 20mins.

c. 20 to 30mins.

d. More

8. What is the average time spent by Admin dept. during recruitment (each

candidate)?

a. 10mins.

b. 10 to 20mins.

c. 20 to 30mins.

d. More

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9. Do your organisation follow different recruitment process for different

grades of employees?

a. No

b. Yes

10. What is the back out percentage of candidates after being offered?

a.1-5

b.5-10

c.10-15

d. 15-20

11. What percentage of candidates leave within the period of less than1- 3

month?

a.1-5

b.5-10

c.10-15

d. 15-20

12. What percentage of candidates leave within the period of less than3- 6

month?

a.1-5

b.5-10

c.10-15

d. 15-20

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13. What percentage of candidates leave within the period of less than 6-12

month?

a.1-5

b.5-10

c.10-15

d. 15-20

14. Does the company reimburse the traveling cost incurred by the candidate

for appearing in the interview?

a. Yes

b. No

c. Depends, how –

15. Do you take any technological support for the process of recruiting?

a. Telephone

b. Video conferencing

c. Online support

d. Other, pls specify –

16. Are you aware of the concept of “Video Resume”?

a. No

b. Yes, then do you use it – Yes/No

17. If the recruitment type is “Employee Referral” then how much special

privilege has to be paid to the one who has referred are sufficient?

a. maximum

b. minimum

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c. moderate

18. In how much time does the whole process generates results?

a. 1-2 days

b. 2-4 days

c. Depends on condition

19. Do you do the “Employment Eligibility Verification”? Yes/No

If yes, then, what method you take up to perform it?

a. Internally

b. Through agencies

20. What kind of verifications you do?

a. Educational qualifications

b. Legal background check

c. Professional background check d. Reference check

e. Family background check

105