HDFC Standard Life Insurance Project

ACKNOWLEDGEMENT

This project is an outcome of the support and encouragement provided

by a number of people at HDFC STANDARD LIFE INSURANCE

COMPANY that embodies some of the best aspect of Indian corporate

world.

I would like to express my sense of gratitude to the company for giving

me this valuable learning opportunity and for allowing me to conduct

this summer project.

I sincerely thanks my project guide Miss. Babita Tripathi &

Ms. Mamta Dhoundiyal, Sales Development Manager, HDFC STANDARD

LIFE INSURANCE COMPANY for guiding me throughout the project

and helpful in furnishing the required information.

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INDEX

INTRODUCTION ………………………………………...5

OBJECTIVES OF STUDY ……………………………….6

SCOPE OF STUDY ………………………………………7

COMPANY PROFILE ……………………………………8

FORM OF ORGANISATION …………………………….13

HISTORY OF INSURANCE… ………………………….15

CURRENT SCENARIO OF INSURANCE SECTOR ….16

BANCASSURANCE ……………………………………19

PRODUCTS OF HDFC STANDARD LIFE INSURANCE……………………………………………20.

BARRIERS TO ENTRY …………………………………27

GROWTH POTENTIAL …………………………………31

FUTURE TRENDS ………………………………………32

UNIT LINKED INSURANCE PLAN ……………………34

FUTURE OF INSURANCE INDUSTRY …………………39

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RESEARCH METHODOLOGY…………………………..42

ANALYSIS & FINDINGS OF SURVEY …………………43

LIMITATIONS …………………………………………….52

CONCLUSION …………………………………………….53

RECOMMENDATIONS ………………………………….54

ANNEXURE ……………………………………………….55

BIBLIOGRAPHY ………………………………………….58

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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.

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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.

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SCOPE OF THE STUDY

The scope of my project was to get an overall view of the Indian

insurance market through comparative study and analysis.

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COMPANY PROFILE

HDFC STANDARD LIFE INSURANCE

HDFC Standard Life Insurance Company Ltd. is one of India’s 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.), India’s 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.

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HDFC Limited

HDFC is India’s 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.

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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.

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Our key strengths

Financial Expertise

As a joint venture of leading financial services groups, HDFC

Standard Life has the financial expertise required to manage your

long-term investments safely and efficiently.

Range of Solutions

We have a range of individual and group solutions, which can be

easily customized to specific needs. Our group solutions have been

designed to offer you complete flexibility combined with a low

charging structure.

Track Record so far

Our cumulative premium income, including the first year premiums

and renewal premiums is Rs. 1532.21 Crores Apr-Mar 2005 - 06.

We have covered over 1.6 million individuals out of which over

5,00,000 lives have been covered through our group business tie-ups.

Our Vision

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'The most successful and admired life insurance company, which means that

we are the most trusted company, the easiest to deal with, offer the best

value for money, and set the standards in the industry'.

'The most obvious choice for all'.

Our Values

Values that we observe while we work::

Integrity

Innovation

Customer centric

People Care “One for all and all for one”

Team work

Joy and Simplicity

Accolades and Recognition

Rated by 'Business world' as 'India's Most Respected Private Life

Insurance Company' in 2004.

Rated as the "Best New Insurer - 2003" by Outlook Money magazine,

India’s number 1 personal finance magazine.

Form of Organisation

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HDFC standard life insurance belongs to a life insurance sector in India.

Life Insurance 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 country’s

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.

Since then the insurance industry has gone through many sea changes.

The competition LIC started facing from these companies were

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threatening to the existence of the LIC. Since the liberalization of the

industry, the insurance industry has never looked back and today

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

The entry of the private players and the increased use of the new

distribution are in the limelight today. The use of new distribution

techniques and the IT tools have increased the scope of the industry in

the longer run.

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

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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.

Current Scenario of Insurance Industry

India with about 200 million middle class household shows a huge untapped

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potential for players in the insurance industry. Saturation of markets in many

developed economies has made the Indian market even more attractive for

global insurance majors. The insurance sector in India has come to a very

high potential and competitiveness in the market.

Innovative products and aggressive distribution have become the say of day.

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

suddenly turning to the private sector that are providing them new products

and variety for their choice.

Life insurance industry is waiting for a big growth as many Indian and

foreign companies are waiting in the line for the green signal to start their

operations. The Indian consumer should be ready now because the market is

going to give them an array of products different in price, features and

benefits. How the consumer is going to make his choice will determine the

future of industry.

CUSTOMER SERVICE

Consumers remain the most important center of the insurance sector. After

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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.

DISTIBUTION CHANNELS

Till date insurance agents still remain the main source through which

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insurance products are sold. The concept is very well established in the

country like India but still the increasing use of other sources is imperative.

It therefore makes sense to look at well-balanced alternative channels of

distribution.

LIC already has well established and an extensive distribution channel and

presence. New players may find it expensive and time consuming to bring

up a distribution network to such standards. Therefore, they are looking to

the diverse areas of distribution channel to have an advantage.

At present the distribution channels available are:

Direct selling

Corporate agents

Group selling

Brokers and cooperative societies

Bancassurance

To make all these channels a success companies have to be very alert and skillful

to know how to use these channels in a proper way. Bancassurance is one of the

most upcoming channels of distribution.

BANCASSURANCE

India has an extensive bank network established over the years. What

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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

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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

Children’s plan

Money back plan

ENDOWMENT PLAN

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The 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

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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

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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.

Don’t compromise on your self-respect, ever. Go ahead, hold your head

high and enjoy life with the HDFC Personal Pension Plan.

CHILDREN’S PLAN

The HDFC Children's Plan gives you:

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Invaluable financial support to your child

Helps you customize an ideal plan for your child

Provides you multiple options for multiple benefits

The HDFC Children’s Plan is designed to secure your child’s 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:

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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 BenefitDeath

Benefit

  5 Yrs. 10 Yrs. 15 Yrs. 20 Yrs. 25 Yrs. 30 Yrs. Within Policy

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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

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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

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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 who’ve already been there in the market for a long time.

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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

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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 market

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India 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

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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

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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.

UNIT LINKED INSURANCE PLAN

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Now One should know what it means… Unit Linked Insurance

Imagine an ideal combination of insurance and life savings that will

help One in the future to finance lofty plans, whether referring to

purchase of a car, contribution to education of children or grandchildren

or just some extra income when retired.

Unit Linked provides you 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.

Financial means invested into Unit Linked are evaluated in the course

of insurance period through four financial funds. It is one oneself that

decide on division of the invested means. One can at any time

reallocate One’s money among the funds. The four funds for

investments are :-

Balancer, Maximizer, Protector, Preserver.

Types of riders offered:

Waiver of premium

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Accidental death rider

Accidental death and disability rider

Accidental full disability annuity rider

Specified accidents and accidental disability rider for a child

How can a person draw the saved money

After the insurance period is over, One will be paid out the invested

sum increased by evaluation, this as a lump-sum payment or regular

annuity.

In case of death in the course of insurance period, the sum assured

agreed upon or the fund value is immediately paid out to a beneficiary

(beneficiaries). The investment value is paid out if it is higher than

the sum assured agreed upon.

How to pay premium

Premium can be paid in regular monthly installments: monthly,

quarterly, semi-annually, and annually. In the course of insurance

period, it is possible to invest other financial means in the form of

top-ups, thus reinforcing the investment part of insurance.

The three in one option - Unit-linked policies:

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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.

ULIP - Unit Linked Insurance Policy - ULIP is a unique, multiple

benefits Plan which combines the basic benefit of life insurance, tax

benefits and accident insurance cover. The plan offers tax deductions

on the amount invested under Section 80C of the Income Tax Act

within the overall limit of Rs. 1,00,000/-.

With the Insurance industry booming up in the Indian economy

following liberalized regulations from the IRDA, the ULIPs have

regained their strength. This was further boosted by the private

insurance companies with foreign partners. .

Under ULIPs, the premiums are invested after deducting the charges

and fees in a fund similar to that of a mutual fund along with a life

insurance cover.

The IRDA regulates that a unit-linked plan must be offered to the

investor with an option to select among debt, balanced and equity

funds. For example, if an investor opts for a unit-linked endowment

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policy, he can choose to invest his premiums in debt, balance or

equity funds. If he selects a debt fund, the majority of his premium

will be invested in debt securities like gilts and bonds. If the option

is equity, a major portion of the premium is invested in the equity

market. The selection of policy depends upon its risk profile and the

Investment needs. Higher the risk, higher would be the returns and

vice versa..

The HDFC Unit Linked Endowment Plan gives you:

An outstanding investment opportunity by providing a choice of

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thoroughly researched and selected investments

Valuable protection to your family in case you are not around

Flexible benefit combinations and payment options

Flexible additional benefit options such as critical illness cover

Access to your accumulated fund before maturity

You can choose your premium and the investment fund or funds. We will

then invest your premium, net of premium allocation charges in your chosen

funds in the proportion you specify. At the end of the policy term, you will

receive the accumulated value of your funds.

In case of your unfortunate demise during the policy term, we will pay the

greater of your Sum Assured (less any withdrawals you have made in the

two years before your claim) and your total fund value to your family.

Use HDFC Standard Life’s excellent investment options to maximize your

savings & secure your and your family’s future. We will provide financial

security for your family in your absence.

THE FUTURE OF THE INSURANCE INDUSTRY

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The insurance industry is today witness to a massive

transformation from its earlier days. From a humble beginning

made in 1956 since the nationalization of the industry and the birth of

the Life Insurance Corporation, the industry today sees a deluge of

multinational insurers all charging in to set up shop here considering

the existent vast unexploited potential.

Multinational partnerships:

The winds of liberalisation have initiated vast changes in the functioning of

the industry today. Increasing number of multinational partnerships with

private insurers have paved the way for a radical shift in insurance selling -

through a number of new distribution channels besides bringing about more

awareness on the need for insurance and also stressing on the important role

technology can play.

With major trade barriers gone, the Indian insurance industry is slowly

opening itself from a protected environment to e-business, incorporating

newer technologies in insurance, thanks to competition, that will hopefully

bring forth a marked improvement in customer service, insurance marketing,

risk management, claim settlement, underwriting etc in comparison to its

earlier days.

Faster decision making:

Today, information dissemination is increasingly faster with the advent

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of information technology, which will largely help individuals gain

access to every bit of information they would require, enabling faster

decision-making. This is in stark contrast with the pre-liberalization era

wherein information sourcing was virtually non-existent except from the

recruited agents of the insurance company.

Policy servicing, an area that has long remained neglected will now receive a

major thrust with insurance companies redefining strategies to weed out

sluggishness and provide the policyholder with prompt service. Online

policy servicing too will soon become the norm thereby cutting down on the

unnecessary delays.

Information explosion:

The oncoming technological revolution is all set to totally revamp the very

concept of Knowledge management. Automating knowledge management

will become the sole aim to increase productivity. Large databases of raw

information on individuals' investment patterns can be fed into computers to

enable faster segregation of information as per required categories.

Computerizing information can make a major difference to the general

insurance industry wherein motor claim losses particularly have been hitting

the roof. With an organized system of data collection and storage, data

analysis and claim management system, keeping track of the claim

applicants’ behavioral patterns becomes easy.

Easier Claims settlement:

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Claims settlement that was hitherto a time consuming affair will see a

marked difference in operations. With competition building and improved

customer service becoming the new mantra the time taken for claim

settlements will reduce considerably. World over underwriting risks, claims

management, risk surveys etc are far more simplified thanks to technology.

Insurance companies are slowly realizing the mass difference information

technology can make to business. Consider policy information being made

available online. Tracking policy details, the premiums to be paid, premiums

paid so far, the bonus percentage, maturity date of the policy and several

such details can be accessed at the mere click of a mouse soon.

Improved customer service - the ultimate aim:

The insurance industry, with competition hooting up is has woken up

to ground realities and is in the process of implementing software

solutions. Realizing the unlimited power information technology holds,

insurance companies have realized that strategic deployment of

technology for integrating office operations, and gaining customer

confidence through improved customer service is the need of the hour.

RESEARCH METHODOLOGY

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The 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.

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FINDINGSAND

ANALYSIS OF SURVEY

The survey was taken from 54 persons & it showed following results:-

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Q1.

Well first foremost result that 87% of the people are looking for profitable

opportunities to invest their money.

Q2.

From survey tit was clear that about 9 % of the persons that were

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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.

Q3.

Then it showed one of the most popular brand in the country is LIC it

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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%.

Q4.

It was also seen that still after 5 years of ULIP plans, a higher percentage

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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.

Q5.

It seem that the main criteria for selection of a plan was low premium, as

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round about 48% voted in favor of it, well 20% of the people also preferred

tax savings, as well as short term time periods. There were persons who

also liked to go for interest benefits; these accounts for 9% and a special

segment (i.e. 7%)of high income liked the criteria of long term time period

as well as the good returns with it. 16% of people preferred insurance

benefits

Q6.

It has been observed that most of the awareness about these brands have

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been due to the internet which stands for 23% and because of the

advertisements that are shown on television which accounts for 57% ,

though media’s old mediums such as newspaper , magazines, which

accounts for 8%, have also equally made their presence felt. Proportion of

people who came to know about these brands from friends are 12%.

Q7.

To be specific the range of amount to be invested varied from person to

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person. But to give an overview following view is prepared: -

1). 2,000- 6,000 = about 15%

2). 6,000-11,000 = about 45%

3). 11, 000-22,000= about 25%

4). 22,000 and above = about 15%

(Amount dedicated is for per month scenarios not per annum)

Q8.

It was also recorded that a large number that were ready to invest were

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business class, which stands at 68%. Yet the service men were not that

much behind to invest. 24% investors are service people. Self employed

accounts for 8%.

LIMITATIONS

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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

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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 can’t conclude the

only plan which one feel the best. I have mainly compared and listed the

features may be better than the others.

RECOMMENDATIONS

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1. Promotion of Brand

HDFC 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 Plans

HDFC 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.

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ANNEXURE

INVESTMENT TRENDS IN INDIAN MARKET

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Please spare few minutes with following survey

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?

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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

William, Smith and Young 1998 Risk Management & Insurance;

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edition VII; Mc Graw Hill Publication

Vaughan & Vaughan, (1999), "Insurance & Risk Management";

Edition I

Jha (1999); "Service Marketing" Ibh Publication.

Harrington, Scott. E & Niehaus, Gregory R.; (1999) "Risk

Management and Insurance"; Irwin/McGraw -Hill.

Gustavson, Sandra G.t Trieschmannt James S. , Hoyt , Robert E.;

(2001) edition XI; MRisk Management And Insurance;" South

Western College Publishing.

INTERNET Websites

www.hdfcinsurance.com

www.qooqle.com

www.bimaquru.com

www.insurance.com

www.mibknowledge.com

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