ACKNOWLEDGEMENT
PROJECT REPORT
ON
HDFC STANDARD LIFE INSURANCE COMPANY
DOABA GROUP OF COLLEGES, GHATAUR, KHARAR (MOHALI)
BY:
MANDEEP SINGH
ROLL NO: 1205495
(Batch 2012-2015)
Submitted to Punjab technical university in partial fulfillment
of the requirements of Bachelors of Business Administration
(BBA)
DECLARATION
I, the undersigned, hereby declare that the project report
entitled Study of HDFC STANDARD LIFE INSURANCE COMPANY submitted
for the degree of bachelors of business administration, is a result
of my own work and the project report has not formed the basis of
the award of any diploma, degree, associate ship, fellowship or
similar other titles. It has not been submitted to any other
university or intuition for the award of any degree or diploma.
MANDEEP SINGH
(BBA 6TH semester)
Acknowledgement
If words are as a symbol of approval and token of appreciation
then let the words lay the heralding role of expressing my
gratitude and thanks.
I am indebted To Ms. Meenu Jaitly PRINCIPAL of Doaba group of
colleges for giving me an opportunity to undertake the project.
I would like to place on record my sincere and whole hearted
sense of gratitude and indebtedness to my learned guide, MISS.
Simran Gill -who provide me all time help and guidance, continue
interest and constant encouragement which led this project to its
successful completion. It was his admiration and motivation that
inculcated in me more enthusiasm and help me in treading the right
line of action.
No appropriate words could be traced to convey my profound
gratitude to my affectionate parents for their selfless devotion,
moral, inspiration and affection which always helped me to face all
odds successfully.
Above all, it is the grace of GOD that led and blessed me all
the way in my life and will certainly help and guide me
continuously. I pray my sincere, earnest and diligent obeisance to
him.
MANDEEP SINGH
BBA 6TH semester
ROLL NO: 1205495
Doaba group of colleges, Kharar (mohali)
INDEX
INTRODUCTION...6
OBJECTIVES OF STUDY.8
COMPANY PROFILE9
FORM OF ORGANISATION.11
HISTORY OF INSURANCE.12
BANCASSURANCE14
PRODUCTS OF HDFC STANDARD LIFE INSURANCE15
BARRIERS TO ENTRY22
GROWTH POTENTIAL26
FUTURE TRENDS29
RESEARCH METHODOLOGY..27
ANALYSIS & FINDINGS OF SURVEY30
LIMITATIONS.34
CONCLUSION.35
RECOMMENDATIONS.36
QUESTIONNAIRE
,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,37
BIBLIOGRAPHY.39
INTRODUCTION
BRIEF IDEA ABOUT THE PROJECT
The outlook of the modern day investors has undergone a dramatic
change. In the changed fiscal scenario with drastic fall in the
interest for investment and the volatile capital market with
limited investment options, ULIP comes to the rescue of the prudent
investors. Investment in insurance has become the style of the day.
The individual looks at buying an insurance policy more of an
investment, which comes with the additional benefits of life cover
and tax benefit also.
Unit Linked plans provides one with not only an effective
protection against individual investment risks and inflation but
above all it brings along a long-term growth potential of financial
means. Everyone decides on their own what is the right method of
investment for them, which predetermines evaluation of deposited
money.
OBJECTIVES OF STUDY
Exposure to financial Service sector particularly insurance and
mutual funds sector.
The study of Insurance in India & Unit Linked Insurance
Plans.
And gain the professional knowledge while working in corporate
environment.
COMPANY PROFILEHDFC STANDARD LIFE INSURANCE
HDFC Standard Life Insurance Company Ltd. is one of Indias
leading private life insurance companies, which offers a range of
individual and group insurance solutions. It is a joint venture
between Housing Development Finance Corporation Limited (HDFC
Ltd.), Indias leading housing finance institution and one of the
subsidiaries of Standard Life plc, leading providers of financial
services in the United Kingdom. Both the promoters are well known
for their ethical dealings and financial strength and are thus
committed to being a long-term player in the life insurance
industry all-important factors to consider when choosing your
insurer.
HDFC Limited
HDFC is Indias leading housing finance institution and has
helped build more than 23,00,000 houses since its incorporation in
1977.
In Financial Year 2003-04 its assets under management crossed
Rs.36,000Cr.
As at March 31, 2004, outstanding deposits stood at Rs. 7,840
crores. The depositor base now stands at around 1 million
depositors.
Rated AAA by CRISIL and ICRA for the 10th consecutive year
Stable and experienced management.
High service standards.
Awarded The Economic Times Corporate Citizen of the year Award
for its long-standing commitment to community development.
Presented the Dream Home award for the best housing finance
provider in 2004 at the third Annual Outlook Money Awards.
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 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.
Form of Organisation
HDFC standard life insurance belongs to a life insurance sector
in India.
Introduction
With such a large population and the untapped market area of
this population, insurance happens to be a very big opportunity in
India.
Today it stands as a business growing at the rate of 15-20
percent annually. Together with banking services, it adds about 7
percent to the countrys GDP. In spite of all this growth the
statistics of the penetration of the insurance in the country is
very poor. Nearly 80% of the Indian population is without life
insurance cover and the health insurance.
This is an indicator the growth potential for the insurance
sector is immense in India. It was due to this immense growth that
the regulations were introduced in the insurance sector and in
continuation the government in 1993 to examine the various aspects
of the industry constituted Malhotra committee. The key element of
the reform process was participation of overseas insurance
companies with 26% capital. Creating a more efficient and
competitive financial system suitable for the requirements of the
company was the main idea behind this reform.
A Brief History
The origin of insurance is very old. The time when we were not
even born: man has sought some sort of protection from the
unpredictable calamities of the nature. The basic urge in man to
secure himself against any risk and uncertainty led to the origin
of insurance.
The insurance came to India from UK: with the establishment of
the Oriental Life Insurance Corporation in 1818.the Indian Life
Insurance Company act 1912 was the first statutory body that
started to regulate the life insurance business in India. By 1956
about 154 Indian, 16 foreign and 75 provident firms were
established in India. Then the central government took over these
companies and as a result the LIC was formed. Since then LIC has
worked towards spreading life insurance and building a wide network
across the length and the breadth of the country. After the
liberalization the entrance of foreign players has added to the
competition in the market.
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. In 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. In 1972 The
General Insurance Business (Nationalization) Act. 1972 nationalized
the general insurance business in India with effect from 1st
January 1973. it was after this that 107 insurers amalgamated and
grouped into four companies viz. the National Insurance Company
Ltd., the New India Assurance Company Ltd., the Oriental Insurance
Company Ltd., and the United India Insurance Company Ltd.
CUSTOMER SERVICE
Consumers remain the most important center of the insurance
sector. After the entry of foreign players the industry is facing a
lot of competition and thus improvement of the customer service in
the industry. Computerization of operations and updating of
technology has become imperative in the current scenario. Foreign
players are bringing in international best practices in service
through use of latest technologies. The one time monopoly of the
LIC and its agents are now going through a thorough revision and
training programmes to catch up with the other private players.
Though lot is being done for the increased customer service and
adding technology to it but there is a long way to go and various
customer surveys indicate that the standards are still below
customer expectation levels.
BANCASSURANCE
India has an extensive bank network established over the years.
What insurance companies have to do is just take advantage of the
customers long-standing trust and relationships with banks. This is
a mutually beneficial situation as banks can also expand their
range of products on offer to customers, while the insurance
company will also earn profits from the exposure. Another,
advantage ids that banjks, with their network in rural areas, help
to fulfill rural and social obligations stipulated by the Insurance
Regulatory Development Authority (IRDA) recently. Insurance
companies should see bancassurance as a tool for increasing their
market penetration in India. It is also good for the one who sees
bancassurance in terms of reduced price, high quality product and
delivery at doorsteps. Everybody is a winner here. The creation of
bancassurance operations has made an important impact on the
financial services industry at large. This is though a new concept
but it has gained a lot of importance in the industry at present
and has a great future.
PRODUCTS
At HDFC Standard Life, we offer a bouquet of insurance solutions
to meet every need. We cater to both, individuals as well as to
companies looking to provide benefits 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.
For individuals, we have a range of protection, investment,
pension and savings plans that assist and nurture dreams apart from
providing protection. You can choose from 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.
Following are the major plans of HDFC:
Endowment plan.
Whole life plan
Pension plan
Childrens plan
Money back plan
ENDOWMENT PLANThe HDFCSL Endowment Assurance Plan gives you:
An ideal way to secure your long-term financial goals
Valuable protection to your family by way of lump sum payment in
case of your unfortunate death within policy term
Provides lump sum payment (basic Sum Assured plus any bonus
additions) on survival up to maturity date
Very flexible benefit options and payment options
In case of your unfortunate demise during the policy term, this
participating (With Profits) insurance plan will pay your family
the Sum Assured (together with the attached bonuses) you had
chosen.
The plan receives simple Reversionary Bonuses, which are usually
added annually. At the end of the term an additional Terminal Bonus
may be paid depending on the performance of the underlying
investment.
WHOLE LIFE PLAN
HDFC Single Premium Whole Of Life Insurance Plan is a
tailor-made plan well suited to meet your long-term investment
needs. This participating plan offers you the following
benefits:
Whole of life plan aimed at providing long-term real growth of
your money.
Single premium investment plan
In case of your unfortunate demise during the policy term, this
participating (With Profits) insurance plan will pay your family
the Sum Assured and compound Reversionary Bonuses, which are
usually added annually. An additional Terminal Bonus may be paid
depending on the performance of the underlying investments.
During Guaranteed Surrender Periods you get the Sum Assured and
all bonuses vested as at the date of surrender.
PENSION PLAN
HDFC PERSONAL PENSION PLAN
We understand your need to build a secure future for yourself.
Hence, the HDFC Personal Pension Plan is an insurance policy that
is designed to provide a post - retirement income for life with the
freedom to choose your retirement date.
You can choose your premium, the Sum Assured and your retirement
date. At the end of the policy term, you will receive the Sum
Assured plus any attaching bonus, which will provide your post -
retirement income.
The HDFC Personal Pension Plan is an insurance policy, which can
benefit you in the following ways:
Provides a post retirement income in your golden years
Gives you the flexibility to plan your retirement date
Gives you tax benefits on your premiums
The plan receives simple Reversionary Bonuses, which are usually
added annually. At the end of the term an additional Terminal Bonus
may be paid depending on the performance of the underlying
investment.
Dont compromise on your self-respect, ever. Go ahead, hold your
head high and enjoy life with the HDFC Personal Pension Plan.
CHILDRENS PLAN
The HDFC Children's Plan gives you:
Invaluable financial support to your child
Helps you customize an ideal plan for your child
Provides you multiple options for multiple benefits
The HDFC Childrens Plan is designed to secure your childs future
by giving your child (the beneficiary) a guaranteed lump sum, on
maturity or in case of your unfortunate demise, early in the policy
term. The company to give you good long-term returns invests the
premiums, paid by you. The plan receives simple Reversionary
Bonuses, which are usually added annually. At the end of the term
an additional Terminal Bonus may be paid depending on the
performance of the underlying investment (See Bonuses for more
details).
MONEY BACK PLAN
The HDFC Money Back Plan is a With Profit Plan that gives
you:
A proportion of the basic Sum Assured as cash lump sums at
regular 5-year intervals within the policy term (see the table
given below) an ideal way to secure your long- term as well as
short-term financial goals
A lump sum payment on survival up to maturity date
Valuable protection to your family by way of lump sum payment in
case of your unfortunate death within the policy term. This is over
and above any earlier payouts
Making the right kind of investment will enable you to achieve
your objectives be it your immediate expenses or else securing your
future financial needs. Our Money Back Plan gives you a wide range
of terms and cash benefit schedule to choose from. A summary of Key
Benefits including the cash lump sum payments, expressed as a
percentage of Sum Assured is shown below:
Key Benefits
Total Policy Term
Survival Benefit
Death Benefit
5 Yrs.
10 Yrs.
15 Yrs.
20 Yrs.
25 Yrs.
30 Yrs.
Within Policy Term
10
40%
60% + Attaching Bonuses
-
-
-
-
100% Sum Assured + attaching bonuses (Over and above the earlier
payouts).
15
30%
30%
40% + Attaching Bonuses
-
-
-
20
25%
25%
25%
25% + Attaching Bonuses
-
-
25
20%
20%
20%
20%
20% + Attaching Bonuses
-
30
15%
15%
15%
15%
15%
25% + Attaching Bonuses
Maturity Value
On maturity you receive survival benefit due at that point of
time along with attaching bonuses for the full Sum Assured
calculated for the full term.You can ensure your financial
independence. And be able to live life on your own terms.
Always.
BARRIERS TO ENTRY
Capital requirements
High gestation period
Access to distribution channels
Brand equity
Indian consumer psychology
Tax avoidance
Capital Requirements
The huge capital requirements pose a major barrier to entry in
the insurance sector . These requirements can be attributed to the
costs incurred in setting up your distribution network. To achieve
economies of scale you would require a nationwide presence, unless
you want to cater to a niche group, which would involve setting up
a huge sales force.
High Gestation Period
On an average a player in the insurance sector would require
around
7-10 years to break-even. This comparatively long gestation
period would entail the player to have sufficiently deep pockets to
bear the losses till the time he breaks even.
Access to Distributional Channels
Given the poor reach of the insurance companies amongst the
Indian public especially in the rural sector the distribution
channels adopted will determine the future growth of the industry.
For the insurance industry to take off in a big way in India
companies will have to adopt new and innovative distribution
channels to be able to cover the vast majority of the Indian
population which is still not covered by the insurance
companies.
Brand equity
Customer loyalty in the insurance sector is very high, thus
benefiting players whove already been there in the market for a
long time. While going in for an insurance policy, the brand and
the trust that it generates are essential criteria on which the
customer makes his judgement. Thus a brand, which has been there
for a long period of time and has managed to serve it customers
well , would be in a position to leverage its brand equity.
Indian Consumer Psychology
The Indian customer, liken his global counterpart , buys
policies for tax benefits and to ensure secure savings for the
future. Although he is price sensitive , he still deserves value
and sound services for his money.
Insurance as savings: There is reluctance amongst Indians to use
insurance policies as a means of investment of their savings.
Traditionally Indians have invested the bulk of their savings in
bank fixed deposits followed by the capital markets in spite of the
low returns offered by the banks and the large risk involved in
trading in stocks. The changing mindset of the Indian public will
be a key driver for growth in the liberalized era.
Insurance for Tax Avoidance:
The urban educated class of Indians traditionally looked at
insurance as a tax avoidance tool. Mindsets are now changing, but
purchase patterns are not. The months of February and March still
are the busiest at LIC. The traditional hook of tax incentives and
savings will take a long time to change. Private players need to
step up their selling in terms of need and protection.
Due to low consumer awareness of the need for insurance and
benefits attached to it, most of the insurance is still sold
through agents. Other distribution channels like banc assurance are
now being explored.
Growth potential of the Indian insurance marketIndia at a
glance
Population: 1 Billion
Economy: 5th largest in the world in terms of Purchasing Power
Parity (PPP)
GDP growth Rate: Over 6% per year on an average for the last
decade
Savings Rate: Around 26% of GDP
Estimated middle class population: 300 Million
Insured population: 70 million only
Future Trends
The Insurance sector is set to see a whole lot of changes in the
way business was traditionally done with new and innovative
products, distribution networks , etc. Changes in the external
environment for the life Insurance market will have to be suitably
understood in order to avoid excessive selling and mis-selling out
of over-enthusiasm.
New Products
Most of the insurance products offered by the traditional Indian
players are outdated, as they are not suitable to the needs of the
consumers. Hence, old as well as new insurers will be offering
innovative products to the consumers. The consumers are
particularly expecting good pension plans, health insurance, term
insurance and Investment products like unit-linked insurance, from
the life insurers. Similarly, the consumers expect innovative
products from the general insurers for managing healthcare,
property insurance, accident insurance and other products related
to the personal line of insurance. The consumers also expect
reduction in the premium of the insurance products as the mortality
rate in India has come down by three times in the last 50
years.
Consumer Education
Very soon the market will be flooded with a large number of
products by a fairly large number of insurers operating in the
Indian market. Even with the limited range of traditional insurance
products , the consumers are confused. Their confusion will further
increase in the face of a large number of products in the market.
The existing level of awareness of the consumers for insurance
products is very low. This is because only 65 percent of the Indian
population is literate. Even the educated consumers are ignorant
about the various products of insurance. Moreover , there is a
shortage of trained agents and brokers. It is necessary that all
the insurers should undertake extensive plans for educating the
consumers.
.
RESEARCH METHODOLOGYThe project is based on Insurance in India,
Future of Insurance in India & unit linked insurance plan
market in India for that , I prepared a questionnaire , based on
which , I took personal interviews . I have also used information
from different Websites, brochures of the organizations &
articles from various newspapers.
The topics are dealt with in a general manner. There would be
details, which could vary from company to company.
Overall, following tools were used to build this project:
Primary data:
a) Questionnaire.
b) Personal interview.
Secondary data
a) Websites.
b) Brochures.
c) Articles.
FINDINGS ANDANALYSIS OF SURVEY
Q1.
Well first foremost result that 87% of the people are looking
for profitable opportunities to invest their money.
Ready To
Invest
77%
Not Ready
23%
Q2.
From survey tit was clear that about 9 % of the persons that
were surveyed said that they would like to go for insurance policy
, 10% were in favor of investment only, and about 81% people were
interested in both insurance as well as investment policy.
Insurance
9%
Investment
10%
Both
81%
Q3.
Then it showed one of the most popular brand in the country is
LIC it seems that about 40% of the people know about their
products, than came the ICICI prudential, where only 25% of the
people knew , although HDFC Standard Life Insurance as a starter
have starting gaining some publicity but it is still not have came
in focus, so is for the other brands .only 20% people knew about
HDFC Standard Life Insurance products. BAJAAJ ALLIANZ accounts for
6% and BIRLA SUN LIFE accounts for 9%.
ICICI
Prudential
25%
HDFC
Standard
Life
20%
LIC
40%
BAJAAJ
Allianz
6%
BIRLA SUN
LIFE
9%
Q4.
It was also seen that still after 5 years of ULIP plans, a
higher percentage of people are still not aware about them, only 15
% are aware of it. Most of people (about 46%) know about the
traditional plan, 12% knows educational plan and 27% know about
pension plan.
Educational
Plan
12%
ULIP
15%
Pension
Plan
27%
Traditional
Plan
46%
LIMITATIONS
1. Time was the biggest constraint as many times it was not
possible to meet senior officials to collect such information.
2. There may be biases on the part of the Company Executive
while providing the information
3. Respondents are not willing to provide information.
4. There are very limited latest information sources for such
topic.
5. The information was collected in few offices only.
CONCLUSION
From this comparative study one can say that everyone has his /
her own perception, when it comes to their priorities regarding the
different features. Well one can say that deciding factor mainly
depends upon perceiving criteria which is different for each and
every person, it is also dependent upon buying capacity, risk
taking ability, profession, age, dependability on members of the
family, income and many more. So one cant conclude the only plan
which one feel the best. I have mainly compared and listed the
features may be better than the others.
RECOMMENDATIONS
1. Promotion of BrandHDFC SLIC has a good reputation among the
people. But to increase market share it needs to take some brand
building measures such as advertising, brand promotion etc.
2. Boosting customer Base what has been seen from the analysis
of data collected from the respondents is that there are a lot of
people who are seriously thinking of buying a policy from HDFC SLIC
but are tentative due to some reason. This is the target market,
which the company should aim for.
3. Variety of PlansHDFC SLIC has a substantial variety of plans
available but due to the fact that insurance market is getting
competitive the company should keep re-inventing itself from time
to time.
4. Availability of Riders Riders are extremely important for
each and every plan as it gives an additional incentive to the
customer and also offers him more flexibility. Thus it is
recommended that the company strive to offer riders on all
plans.
Questionnaire
Name
Address
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Contact no ______
Gender ______
1) Are you looking for some options to invest your Money?
a) Yes b) No
2) Out of these which are the priority for you at the
moment?
a) Insurance b) Investment
c) Both of the above
3). What are the various brands you are aware of:
a) ICICI prudential b) HDFC standard life c) LIC d) BAJAAJ
Allianz e) BIRLA SUN LIFE f) Other
4). Which of these plans are YOU aware of?
a) ULIP Plan b) Traditional Plan c) Educational Plan
d) Pension Plan e) Any other..
5). Which type of benefit you will see to invest your money in
Insurance Sector?
a) Low Premium b) Short Time period c) Long Time Period d) Tax
saving
e) Insurance f) Interest benefits g) any other
6). From where do you come to know about these brands?
a) Internet b) News paper c) Friends
d) TV e) Any other.
7) How much do you plan to invest your money in a Investment
Plan?
8) What profession are you in: -
a) Business b) Service c) self employed d) Any other
BIBLIOGRAPHY
INTERNET Websites
www.hdfcinsurance.com
www.qooqle.com
www.bimaquru.com
www.insurance.com
www.mibknowledge.com
_1136222683.
_1136223221.
_1136223620.
_1136222378.