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A REPORT ON INPLANT TRAINING DONE AT BIRLA SUN LIFE INSURANCE

A Report Submitted In Partial Fulfillment Of The Requirements Of BBA Program (2008-11) In Plant Training Prepared By Pankaj Kumar Shahu 08AHB1319 BACHELOR OF BUSINESS ADMINISTRATION

Under the Guidance of Mrs. D. Suthamathi

DEPARTMENT OF BUSINESS ADMINISTRATION AVS COLLEGE OF ARTS & SCIENCE (Affiliatedto Periyar University) SALEM 636 106

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ACKNOWLEDGEMENT

I take this opportunity to express my acknowledgement and deep sense of gratitude for rendering valuable assistance and guidance to me by following personalityfor successful completion of my project. I am highly obliged to my project guideMrs.D. Shuthamathi for his personal encouragement, prompt assistance and help provided to me in completion of my project. She has helped me a lot by giving suggestions and guidance whenever needed. Her contribution has been extremely useful and is greatly appreciated. I honor his knowledge and competence in the fieldof management. I am greatly indebted to the head of department of BBA (CA) Mr G.Mahendran for providing me the facilities of the In-plant training.

PANKAJ KUMAR SHAHU 08AHB1319 BBA(CA)

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PREFACE

To achieve partial and concrete results, it is necessary that theoretical knowledge must be supplemented with practical environment. Keeping this view in mind,I have completed my research work regarding Birla Sun Life Insurance.By doing thisresearch work I have learnt a lot of things which would be really helpful for me in future. This experience in decision making and practical application of knowledge has contributed greatly to my growth.


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DECLARATION

I hereby declare that the survey entitled, Birla Sun Life Insurance that no part of research work has been submitted for any other degree. I also undertake that work is purely academic and no part has been copied or taken from any where. Themotive behind the research project was In plant Training in Birla Sun Life Insurance in Company.


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INDEXSerial No. Particulars Page No.

1 2. 3.

Introduction Review Of Literature Need, Scope & Objective Of The Study ResearchMethodology Data Analysis And Interpretation Findings Of The Study Suggestion Limitations Conclusion Recommendations Bibliography Annexure

6 36

43 45 49 58 60 62 64 66 68 70

4. 5. 6. 7. 8. 9. 10. 11. 12.

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CHAPTER-1

INTRODUCTION

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Introduction:-

The Birla Sunlife Insurance Company was established in the year 2006, with a joint venture of two leading companies likely Aditya Birla group and Sunlife

financials(USA). Birla Sun Life Insurance pioneered the unique Unit Linked LifeInsurance Solutions in India. Within 4 years of its launch, Birla Sunlife Insurance has cemented its position as a leading player in the Private Life InsuranceIndustry. Birla Sunlife insurance has been focus on Investment Linked InsuranceProducts, supported with protection products to maintain leadership in product innovation. Multi distribution channels- Direct Sales Force, Alternate Channels and Group offering convenient channels of purchase to customers. It has established Web-enabled IT systems for superior customer services to have issued policiesover the Internet. Corporate governance and a high degree of transparency in all business practices and procedures to have an operational Business Continuity Plan and all Strong fundamentals based on the Aditya Birla group's local insightand Sun Life financials's global expertise.

The head office is situated in below address, Birla Sunlife Insurance company ltd. 6th floor, Vaman center Makhwana Road, Off andheri-kurla Road Andheri(East),Mumbai-400059 The Branch office in Mangalore is located in:Birla Sunlife Insurance company ltd. 2nd floor, Premium Enclave Light House Hill Road Mangalore-5750027

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Vision:To create long term value along with market leadership Missions: To help people mitigate risks of life, accident, health and money at all stages and underall circumstances Enhance the financial future of our customers, including enterprises. Values: Integrity Commitment Passion Seamlessness Speed BSLI has contributed significantly to the growth and development of the life insurance industryin India by introducing unique Unit Linked Life Insurance Solutions, pure term plan and a slew of innovative products. By adopting multi-distribution channels such as Direct Sales Force, alternate channels and convenient points of purchase,including selling its policies through the ban assurance route and through theinternet, BSLI has revolutionized the entire insurance policy-buying experience.Corporate governance and a high degree of transparency in all its business practices and procedures, besides world-class processing capabilities and wellprepared business continuity planning, have brought about the credibility that BSLI enjoys among its patrons. The process of getting sales illustrations signed by customers, offering a free look period on all policies, which are now standard norms followed by the insurance industry, were introduced by BSLI.

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About the Aditya Birla Group The Aditya Birla Group has a turnover close to Rs.38,000 crore (as on 31 March 2008) and is one of the largest business houses in India. It enjoys a leadership position in all the sectors in which it operates. With over 75 business units spanning the South East Asian belt, Africa, Canada and the UK among others, it is reckoned as India's first multinational corporation. The group is anchored by 72,000 employees and has seven lakh shareholders, with a market capitalization of Rs.53,400 crore.

About Sun Life Financial Inc. Sun Life Financial Inc. is a leading internationalfinancial services organization providing a diverse range of wealth accumulation and protection products and services to individuals and corporate customers. Tracing its roots back to 1865, Sun Life Financial and its partners today have operations in key markets worldwide, including Canada, the United States, the United Kingdom, Hong Kong, the Philippines, Japan, Indonesia, India, China and Bermuda. As of 31 March 2008, the Sun Life Financial group of companies had total assets under management of US$ 343 billion. Sun Life Financial Inc. trades on the Toronto (TSX), New York (NYSE) and Philippine (PSE) stock exchanges under tickersymbol "SLF".

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Key peoples of organisation Board of Directors y y y y y y y y y y Mr. Kumar M Birla Mr. Donald A Stewart, Mr. Bishwanath N Puranmalka Mr. Ajay Srinivasan Mr. Gary M Comerford Mr. Suresh N Talwar Mr. Gian P Gupta His Highness Maharaja G Singh Mr. Stephan Rajotte Dr. Bharat K Singh

Investment Committee y y y y y y y y Mr. B. N. Puranmalka Mr. Eugene Lundrigan Mr. Ajay Srinivasan Mr. Vikram Mehmi Mr. Mayank Bathwal Mr. Fabien Jeudy Mr. Vikram Kotak Ms. Keerti Gupta

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Management Team Mr. Vikram Mehmi President & Chief Executive Officer Mr. MayankBathwal Chief Financial Officer Mr. Mario Braganza Chief Operating Officer Mr. E.N. Goveia Head - Direct Sales Force Mr. Amit Punchhi Senior Vice President - Third Party Distribution Mr. Bhavesh Sanghvi Head - Group Life & Pensions Mr. Snehal Shah Senior Vice President - Operations Ms. Anjana Grewal Senior Vice President - Marketing & Communications Mr. Rajesh Bhojani Senior Vice President - DSF Expansion Mr. K.H. Venkatachalam Vice President Human Resource Mr. Fabien Jeudy Vice President, Chief & Appointed Actuary Mr. Lalit Vermani Vice President - Compliance Mr. Melvyn D'souza Vice President Risk Management and Internal Audit Mr.Vikram Kotak Vice President - Investments Mr. Bhalachandra Nayak Vice President Strategy

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Competitors:y y y y y y y y y y y Life insurance corporation ING vysya life insurance Max network life insurance MetLife insurance Aviva life insurance BharathiAxa life insurance Bajaj Allianz life insurance Tata AIG life insurance ICICI Prudential Life Insurance Reliance life insurance Kotak Mahindra life insurance

Competitors in Detail: Aviva life insurance: Aviva Life Insurance Company India Pvt. Ltd. is a joint venture between Aviva of UK and Dabur, one of India's leading producers of traditional healthcare products. Aviva holds a 26 per cent stakein the joint venture and the Dabur group holds the balance 74 per cent share. Bajaj Allianz: Bajaj Allianz is a joint venture between Allianz AG one of the world's largest insurance companies, and Bajaj Auto, one of the biggest 2 and 3 wheeler manufacturers in the world. Bajaj Allianz is into both life insurance and general insurance. Allianz Group is one of the world's leading insurers and financial services providers. Founded in 1890 in Berlin, Allianz is now present in over 70 countries HDFC Standard Life Insurance Co. Ltd: is a joint venture betweenHDFC Ltd., India's largest housing finance institution and Standard Life Assurance Company, Europe's largest mutual life company. It was the first life insurance company to be granted a certificate of registration by the IRDA on the 23rd ofOctober 2000. ING Vysya Life Insurance Company Limited: is a joint venture between Vysya Bank and ING Group of Holland, the world's 4th largest financial services group, with presence across 50 countries, and a heritage of over 150 years.13

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Kotak Mahindra Old Mutual Life Insurance Ltd: is a joint venture between Kotak Mahindra Bank Ltd. (KMBL), and Old Mutual plc. Kotak Mahindra is one of India's leading financial institutions and offers a range of financial services such as commercial banking. Life Insurance Corporation of India: (LIC) is an autonomous body authorized to run the life insurance business in India with its Head Officeat Mumbai. It has been established by an act of the Parliament and started functioning from 1/9/1956. ICICI Prudential Life Insurance : ICICI Prudential life insurance is a part of ICICI Bank. Max New York Life Insurance Company Limited isa joint venture between Max India Limited, a multi-business corporate, and New York Life International, a global expert in life insurance. New York Life is a Fortune 100 company that has over 160 years of experience in the life insurance business. MetLife India Insurance Co. Pvt Ltd is a joint venture between MetLife Group and its Indian partners. The Indian partners include J&K Bank, DhanalakshmiBank, Karnataka Bank, Karvy Consultants, Geojit Securities, Way2Wealth, and Mini Muthoothu. Reliance Life Insurance Company Limited is a part of Reliance Capital Ltd. of the Reliance - Anil Dhirubhai Ambani Group. The company acquired 100per cent shareholding in AMP Sanmar Life Insurance Company in August 2005. Taking over AMP Sanmar Life provided Reliance Life Insurance a readymade infrastructure and a portfolio. SBI Life Insurance is a joint venture between the State Bankof India and Cardiff SA of France. SBI Life Insurance is registered with an authorized capital of Rs 500 crore and a paid up capital of Rs 350 cores. Tata AIGLife Insurance Company Limited is a joint venture between Tata Group and American International Group, Inc. (AIG). Tata Group is one of the oldest and leading business groups of India. Tata Group has had a long association with India's insu

rance sector having been the largest insurance company in India prior to the nationalization of insurance. The Late Sir Dorab Tata was the founder Chairman of New India Assurance Co. Ltd., a group company incorporated way back in 1919. Shriram Life Insurance Company Ltd is a joint venture between the Chennai-based Shriram Group and the South African insurance major Sanlam. The company launched itsoperation in India in December 2005

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STRENGTH: Multi-channel distribution and one of the largest distribution networks in India. Implementing Six-Sigma process. Customer centric products and services. Superior investment and risk management framework 1 Million Policies sold within 3 andhalf years. Company has maximum number of MDRT as well as good number of HNI advisors. Training process of the company is very strong. Different plan for different peoples. According to the change in surrounding environment like changes incustomer requirement.

WEAKNESS: COMPANY does not penetrate on the rural market at a time. There is no plan for the low income group. Fees for the advisor is high than the other company.

OPPORTUNITY: Insurance market is very big, where company can expand its horizon in insuranceindustry. Though good investment and insurance it is easy to top Indian customers. The huge insurance market (77%) is left so company has opportunity to expandour products. To associate with the more number of HNI.

THREATS: OLD HABITS DIE HARD: Its still difficult task to win the confidence of public towards private company. The company is facing major threats from LIC -which is an only government company. Plans for all income groups are not available which cancreate adverse effect later on the market share of the company.

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INTRODUCTION TO THE REPORTEVALUATION OF INSURANCEThe evaluation of insurance dates back as early as the commencement of trade between two countries in England, especially between the European countries. Duringthe transportation of goods, there were chances of the ship being drowned in the rough sea conditions or attacked by the pirates, leading to huge loss to the party sending goods. The traders of England devised a way whereby the loss of thegoods would be compensated by every trader putting in some amount as per theirfinancial strength so that a single party may not be the loser; this is the earlier concept of insurance. This concept is taking shape for the last 300 years, yet in India the first insurance company was established in 1818 with the adventof European widows. The name of the company was oriental life insurance company.

WHAT IS INSURANCE?Insurance is a mechanism that ensures an individual to thrive on adverse consequences by compensating the individual, his/her loss financially. Every individualin the world and all activities connected with him/her, be it life, profession,business, travel or any other pursuits are subject to unforeseen and uncalled for hazards or dangers. The benefit that an individual enjoys in his life by owning a car or a house or a factory can be snatched by sudden accident which can render even the individual immobile, and his family vulnerable. At this critical juncture, only insurance helps him not only to survive but recover his loss and continue his life in a normal manner, which would otherwise be unthinkable. The concept of insurance is quite simple. People, who are in similar trade and are ex

posed to the same risks, congregate and some to an agreement that if any individual member suffer a loss, then the loss will be shared by others and minimized in order to enable the individual member recover from the loss and cover his ground. Similarly the different kinds of risks can be identified and separate groupscan be formed to counter such risks and reduce to impact to manageable proportion, in which the share could be collected from the members either after the lossor in advance, at the time of admission to the group. This is an exemplary signof humanity and insurance therefore serve the mankind to a great extent; a point most of the individual tend to overlook, since monetary aspect is involved. Now such is for tangible assets.

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The concept of insurance has been extended beyond the coverage of tangible assets. Exporters run the risk of importers in other country defaulting as well as losses due to sudden fluctuations in the currency exchange rates, economic policies turmoil. The risk are not insured. Doctors run the risk of being charged withnegligence and can subsequently liable for damage. The amount in question can befairly large, beyond the capacity of the individual to bear. These are insured.Thus insurance is extended to intangible assets. In some countries even the voice of a singer , legs of the footballer can be insured, even though the advantage of spread may not be available in these cases. Satisfaction of economics needsrequires generation of income from some sources. If the property, which is thesource of such income, were lost fully or partially, permanently, or temporarily, the income too would stop. The purpose of insurance is to safeguard against such misfortune few, through the help of the fortune many, who were exposed to thesame risk , but saved from the misfortune . Thus the essence of insurance is toshare losses substitute certainty by uncertainty. The different types of humanactivities that come under the umbrella of insurance are as follows.

1. House/office/factory or any moveable object destroyed in life 2. Shipment ortransportation of goods By ship, destroyed in catastrophe. 3. jewellery /cash/ household goods Stolen or robbed 4. Goods in transit by roads or railways destroyed. 5. Theft or accident of vehicles 6. Financial cover in ailment /surgery etc

- Fire insurance - Marine insurance

- Burglar insurance

- Carrier insurance - Vehicle insurance - Health insurance

All these are non-life insurance. In conclusion one can safely say that the purpose of insurance be it or non-life is to transfer the financial loss to the insurance company who spreads in over to the policyholders.

Life insuranceLife insurance (Life Assurance in British English) is a type of insurance. As inall insurance, the insured transfers a risk to the insurer. The insured pays apremium and receives a policy in exchange. The risk assumed by the insurer is the risk of death of the insured.

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How life insurance worksThere are three parties in a life insurance transaction; the insurer, the insured, and the owner of the policy (policyholder), although the owner and the insured are often the same person. For example, if John Smith buys a policy on his ownlife, he is both the owner and the insured. But if Mary Smith, his wife, buys apolicy on John's life, she is the owner and he is the insured. The owner of thepolicy is called the grantee (he or she will be the person who will pay for thepolicy). Another important person involved is the beneficiary. The beneficiaryis the person or persons who will receive the policy proceeds upon the death ofthe insured. The beneficiary is not a party to the policy, but is designated bythe owner, who may change the beneficiary unless the policy has an irrevocable beneficiary designation. With an irrevocable beneficiary, that beneficiary must agree to changes in beneficiary, policy assignment, or borrowing of cash value. The policy, like all insurance policies, is a legal contract specifying the termsand conditions of the risk assumed. Special provisions apply, including a suicide clause wherein the policy becomes null if the insured commits suicide withina specified time for the policy date (usually two years). Any misrepresentationby the owner or insured on the application is also grounds for nullification. Most contracts have a contestability period, also usually a two-year period; if the insured dies within this period, the insurer has a legal right to contest theclaim and request additional information before deciding to pay or deny the claim. The face amount of the policy is normally the amount paid when the policy matures, although policies can provide for greater or lesser amounts. The policy matures when the insured dies or reaches a specified age. The most common reason t

o buy a life insurance policy is to protect the financial interests of the ownerof the policy in the event of the insured's demise. The insurance proceeds would pay for funeral and other death costs or be invested to provide income replacing the deceased's wages. Other reasons include estate planning and retirement. The owner (if not the insured) must have an insurable interest in the insured, i.e. a legitimate reason for insuring another persons life. The insurer (the life insurance company) calculates the policy prices with intent to recover claims tobe paid and administrative costs, and to make a profit. The cost of insurance isdetermined using mortality tables calculated by actuaries. Actuaries are professionals who use actuarial science which is based in mathematics (primarily probability and statistics). Mortality tables are statistically based tables showingaverage life expectancies. The three main variables in a mortality table are age, gender, and use of tobacco. 18

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The mortality tables provide a baseline for the cost of insurance. In practice,these mortality tables are used in conjunction with the health and family history of the individual applying for a policy in order to determine premiums and insurability. The current mortality table being used by life insurance companies inthe United States and their regulators was calculated during the 1980s. There is currently a measure being pushed to update the mortality tables by 2008. The current mortality table assumes that roughly 2 in 1,000 people aged 25 will die during the term of coverage. This number rises roughly quadratically to about 25in 1,000 people for those aged 65. So in a group of one thousand 25 year old males with a $100,000 policy, a life insurance company would have to, at the minimum, collect $200 a year from each of the thousand people to cover the expected claims. The insurance company receives the premiums from the policy owner and invests them to create a pool of money from which to pay claims, and finance the insurance company's operations. Contrary to popular belief, the majority of the money that insurance companies make comes directly from premiums paid, as money gained through investment of premiums will never, in even the most ideal market conditions, vest enough money per year to pay out claims. Rates charged for life insurance increase with the insured's age because, statistically, a people are more likely to die as they get older. Since adverse selection can have a negative impact on the financial results of the insurer, the insurer investigates each proposed insured (unless the policy is below a company-established minimum amount)beginning with the application, which becomes part of the policy. Group Insurance policies are an exception. This investigation and resulting evaluation of therisk is called underwriting. Health and lifestyle questions are asked, and the a

nswers are dutifully recorded. Certain responses by the insured will be given further investigation. Life insurance companies in the United States support The Medical Information Bureau, which is a clearinghouse of medical information on all persons who have ever applied for life insurance. As part of the application,the insurer receives permission to obtain information from the proposed insured's physicians. Life insurance companies are never required by law to underwrite or to provide coverage on anyone. They alone determine insurability, and some people, for their own health or lifestyle reasons, are uninsurable. The policy canbe declined (turned down) or rated. Rating means increasing the premiums to provide for additional risks relative to that particular insured. Many companies usefour general health categories for those evaluated for a life insurance policy.These categories are Preferred Best, Preferred, Standard and Tobacco. PreferredBest

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means that the proposed insured has no adverse medical history is not under medication for any condition, and his family (immediate and extended) has no historyof early cancer, diabetes or other conditions. Preferred is like Preferred Best, but it allows that the proposed insured is currently under medication for thecondition and may have some family history. Most people are in the Standard category. Profession, travel, and lifestyle also factor into not only which categorythe proposed insured falls, but also whether the proposed insured will be denied a policy. For example, a person who would otherwise be in the Preferred Best category will be denied a policy if he or she travels to a high risk country. Upon the death of the insured, the insurer will require acceptable proof of death before paying the claim. The normal minimum proof is a death certificate and theinsurer's claim form completed, signed, and often notarized. If the insured's death was suspicious and the policy amount warrants it, the insurer may investigate the circumstances surrounding the death, before deciding whether there is a legal obligation to pay the claim. Proceeds from the policy may be paid in a lumpsum or as an annuity paid over time in regular recurring payments for either forthe life of a specified person or a specified time period.

Contribution of life insurance in development of economy Contribution of Life Insurance Sector in the Economy Flow of Insurance Industryin India Structure of insurance industry: Snap Shot Industry Aggregation of longterm savings Spread of financial services in rural Areas Long term funds for infrastructure development of capital Markets/ Economic Growth Employment generation Special Futures Growth Potential

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DETAILS OF PRODUCTSPRODUCTS Life is unpredictable. But in face of adversity, our responsibilities towards our parents, children and loved ones need not be compromised. Insurance planning equips you to smooth out the uncertainties and adversities that life might send your way, so that the best that life has to offer, secure in the knowledge that your beloved ones are well provided for. BSLI offers a complete range ofinsurance products

1. Protection Plans 2. Savings Plans 3. Child Plans 4. Investment Plans 5. Retirement Plans 6. Group Plans 7. Rural Plans

Insurance Plans BSLI offers Lifeguard - a set of pure protection plans. Choose from amongst three different product structures to insure your life and provide total security to your family, at a very affordable cost.

Level Term Assurance with return of premium On death the entire sum assured willbe paid. On maturity, all the premiums paid will be returned. Level Term Assurance without return of premium On death the entire sum assured will be paid. No survival or maturity benefits. You can also enhance the above two policies by adding Accident & Disability Benefit Rider and Waiver of Premium Rider (WOP)

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Level Term Assurance - Single premium: On death the entire sum assured will be paid. No survival or maturity benefits. Protection Plans BSLI offers a variety ofpolicies that give you the benefits of protection and the opportunity to save for important assets or events, like a home, a car or a wedding. A regular premium unit-linked insurance plan with an assurance of Capital Guarantee# with the added advantage of flexible liquidity option. An ideal plan for long term planningwith the benefit of liquidity.

The key features of the plan are: Flexibility to choose a specific level of protection (Sum Assured), based on a multiple of the annual premium. You can also choose the term of the plan. At the end of the term, the higher of the value of units or the guaranteed value is paid. On death, Sum Assured along with the higherof value of units or the guaranteed value is payable. Facility to make withdrawals from the 6th policy year onwards till the end of the policy term. Every yearwithdraw up to 10% of the value of units. Additional credits payable as a percentage of the initial annual premium are paid along with the death or maturity benefit. Additional insurance for 10 years after the maturity, for an amount of 50% of the Sum Assured

Savings Plans Flexibility to make additional investment with the help of the top-up facility. Flexibility to increase / decrease your annual premium Amount Facility of Automatic Premium Payment- With this facility you can take a temporary break from premium payment. Total transparency with the premium allocations, andother charges declared upfront.

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The guaranteed value of the unit fund is the value of all invested premiums (premiums net of all charges) along with the declared bonus interests. With Automatic Premium Payment facility, you can avail a temporary break from premium paymentfor a maximum of 1 year. This facility is available once if the premium payingterm is less than 15 years and twice, if it is 15 years or more. You can also enhance your policy by adding Accident & Disability Benefit Rider , Waiver of Premium Rider and Critical Illness Rider .A regular premium unit-linked insurance plan with an assurance of Capital Guarantee# An ideal plan for your long-term savings and protection requirement.

The key features of the plan are:

Flexibility to choose a specific level of protection (Sum Assured), based on a multiple of theannual premium. You can also choose the term of the plan. At the end of the term, the higher of the value of units or the guaranteed value is paid. On death, Sum Assured along with the higher of value of units or the guaranteed value is payable Additional credits payable as a percentage of the initial annual premium are paid along with the death or maturity benefit. Additional insurance for 10 years after the maturity, for an amount of 50% of the Sum Assured. Flexibility to make additional investment with the help of the top-up facility. Flexibility to increase / decrease your annual premium amount Facility of Automatic Premium Payment- With this facility you can take a temporary break from premium payment. Total transparency with the premium allocations, and other charges declared upfront

. The guaranteed value of the unit fund is the value of all invested premiums (premiums net of all charges) along with the declared bonus interests. With Automatic Premium Payment facility, you can avail a temporary break from premium payment for a maximum of 1 year. This facility is available once if the premium paying term is less than 15 years and twice, if it is 15 years or more. The capital guarantee is applicable only on the invested premium and the declared bonus interests. You can also enhance your policy by adding Accident & Disability Benefit Rider, Waiver of Premium Rider and Critical Illness Rider.

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A unit-linked insurance plan with an assurance of Capital Guarantee which offersyou the benefit of a limited premium payment term. An ideal plan for protectionwith wealth creation that offers the flexibility of a limited premium paying term. Flexibility to choose a premium payment term of 5, 7 or 10 years for a maturity term of 10, 15 or 20 years respectively. Flexibility to choose a specific level of protection (Sum Assured), based on a multiple of the annual premium. At the end of the term (maturity), the higher of the value of units or the guaranteed value is paid. On death, Sum Assured along with the higher of value of units or the guaranteed value is payable. Additional credits payable as a percentage ofthe initial annual premium are paid along with the death or maturity benefit. Facility to make withdrawals from the 6th policy year onwards till the end of thepolicy term. Every year withdraw up to 10% of the value of units Flexibility tomake additional investment with the help of the top-up facility. Flexibility toincrease / decrease your annual premium amount Total transparency with the premium allocations, and other charges declared upfront. The guaranteed value of theunit fund is the value of all invested premiums (premiums net of all charges) along with the declared bonus interests. The capital guarantee is applicable onlyon the invested premium and the declared bonus interests. You can also enhanceyour policy by adding Accident & Disability Benefit Rider and Critical Illness Rider. Presenting Premier Life The Preferred plan for the Preferred Customer. Thekey features of the plan are: Limited premium payment option: Choose from amonga 3, 5, 7 or 10 year premium paying term. Choice of sum assured: Choose a sum assured, which is a minimum multiple of 1 and a maximum multiple of 25 times theannual contribution. Additional allocation of units on a periodic basis. Facilit

y to top-up your investment any time you have surplus funds. Choose from among four funds, based on your investment objective and risk appetite. 24

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Flexibility to decrease your sum assured. Add-on riders to protect you against any eventuality. Loans against the policy. You can also enhance your policy by adding Critical Illness Rider, Accident & Disability Benefit Rider. Presenting Life Time unit linked plans that meet your changing needs over a lifetime. These solutions have been developed to meet your savings, protection and investment needsat every stage in life. Protection Choose a specified level of protection (available only with Lifetime). Two levels of Sum Assured to choose from (available only with Lifetime II). Flexibility to increase or decrease your sum assured. Add-on riders to protect you against any eventuality. Savings Flexibility to increase or decrease your contribution. Facility of Premium Holiday, wherein the policy continues even if there is a temporary break in the payment of annual contribution (available only with Life Time). Facility of Automatic Cover Continuance, wherein the policy continues even if there is a temporary break in the payment ofannual contribution Facility to top-up your investment any time you have surplus funds. Additional allocation of units on a periodic basis. Loans against the policy. Investment: Choose from among four funds, based on your investment objective and risk appetite. Choice to switch between investments options (4 free switches every policy year). You can also enhance your policy by adding Critical Illness Rider, Major Surgical Assistance Rider, Accident & Disability Benefit Rider, Accident Benefit Rider (available only with Life

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Time) and Waiver of Premium Rider. An insurance plan that gives added protection, savings and multiple options, all in one! The flexibility to choose your premium contribution. The flexibility to choose amongst three levels of cover (in theform of sum assured) for the same amount of total annual contribution. The flexibility of shifting between the three levels of cover, as you require. The flexibility of receiving your maturity proceeds as a lump sum or in equal annual installments over 3 or 5 years. You can also enhance your policy by adding Variety of Riders An insurance plan that gives you added protection, savings, multiple options, plus the power of liquidity. The flexibility to choose your premium contribution. The flexibility to choose amongst three levels of cover (in the form ofsum assured) for the same amount of total annual contribution. The flexibilityof shifting between the three levels of cover, as you require. The flexibility of receiving your maturity proceeds as a lump sum or in equal annual installmentsover 3 or 5 years. The flexibility of withdrawing up to 10% of the accumulatedvalue of your policy, after the first 5 policy years. You can also enhance yourpolicy by adding Variety of Riders An ideal plan for those who want to accumulate funds on a regular basis while enjoying insurance protection. Guaranteed Benefits: Guaranteed additions @ 3.5% of the Sum Assured, compounded annually for thefirst 4 years of the policy. Extended Life Cover: An extended cover for 5 yearsafter the maturity of the policy, for 50% of the sum assured, at no extra cost. Maturity Benefit: At the end of the term, the policyholder receives the full sum assured, the guaranteed additions and the vested bonuses. Death Benefit: The beneficiary receives the sum assured, the guaranteed additions and the vested bonuses in case the life assured were to meet with an unfortunate event. In case th

e life assured is aged 7 years or less, the basic premium paid will be returned.You can also enhance your policy by adding Critical Illness Rider, Major Surgical Assistance Rider, Accident & Disability Benefit Rider, Waiver of Premium Rider (WOP) As a responsible

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parent, you will always strive to ensure a hassle-free, successful life for yourchild. However, life is full of Uncertainties and even the best-laid plans cango wrong. Heres how you can give your child a 100% safe and assured tomorrow, whatever the uncertainties. Smart Kid is especially designed to provide flexibilityand safeguard your childs future education and lifestyle, taking all possibilities into account. Choose from amongst a basket of 4 plans: Smart Kid regular premium Smart Kid unit-linked regular premium Smart Kid unit-linked regular premiumII Smart Kid unit-linked single premium II CHILD PLANS All these plans offer you:

Financial Benefits: Regular payments at critical stages in your childs life, likeBoardexaminations, Graduation and Post-graduation. Total peace of mind, even if you are not around Sum Assured is paid immediately: Ensures that your loved ones stayfinancially secure, even in your absence. All future premiums are waived: Ensuring that your family is not financially burdened in your absence. Policy benefits continue: The educational benefits of the policy continue, ensuring that yourchild can realize his or her dreams without any hassles. Development Allowance:Smart Kid guarantees regular income to secure your childs educational career andalso ensures his or her all-round development, for a nominal additional amount.The Income Benefit Rider takes care of this through an annual payment of 10% ofthe sum assured, to your child, till the maturity of the policy, in the unfortunate event of the death of the parent. All Smart Kid plans can be enhanced with the Accident & Disability Benefit Rider and Income Benefit Rider . You can also a

n Accident Benefit Rider to a Smart Kid Regular Premium policy, and a Waiver ofPremium Rider (WOP) to Smart Kid unit-linked regular premium policy.

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Life Link II is a unique plan that combines the security of a life insurance policy with the opportunity of enjoying high returns on your investments, without the market risks compromising on the protection of your family! Death Benefit: The Sum Assured under the product has 2 options, either 500% of the initial premium or 105% of the initial premium. In the event of an unfortunate death, the beneficiary will receive higher of the value of units or the initial death benefit,less any withdrawals. Withdrawal Benefit: One can make partial withdrawals fromthe accumulated value of the policy after completion of one policy year. Flexibility: Choose from four fund options, based on your investment objective and riskappetite. If at a later stage your financial priorities change, you can switchbetween the various fund options, absolutely free, 4 times a year.

Investment Plans Life Expectancy has been rising rapidly and today you can expect to live longer than your earlier generations. For you, this increase will meana longer retirement life, stretching into a couple of decades. BSLI RetirementSolutions that combine the best of insurance and investment. These solutions aredeveloped to ensure your peace of mind for the years to come. 1. Why plan for retirement? 2. How much should I set aside for retirement? 3. The impact of inflation on your retirement savings 4. Why plan early? 5. About Annuities

Why plan for retirement? For too many people, the joy of retirement after yearsof hard work is eclipsed by the financial uncertainties that it brings. Despiteall the planning and saving, you can never sure whether your money will last a lifetime. Retirement planning offers a way to ensure a more enjoyable, stress fre

e tomorrow. A prudent plan will ensure that increasing life expectancy, higher inflation and increasing taxes do not eat away into your hard earned savings.

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Retirement Plans How much must I set aside for retirement? To ensure a comfortable retired life, you would be wise to invest money into additional avenues likepension plans. How much you need to invest can be answered by answering some questions such as: 1. How long do you have to save that amount before retirement? 2. Where can you invest your retirement money? 3. How much risk are you willing to take on your investments? In an era of competitive parity, the only asset thatmakes a decisive difference between corporate success and failure is the quality of human capital. Employee benefits have proven to be an excellent tool to optimize the retention of talent and improve an organizations bottom-line. The quality of an organizations employee benefits establishes and maintains a company's image as a caring employer. Optimum care of employees is a long-term investment that results in a sustained competitive advantage for an organization in the timesto come. BSLI Group Solutions Advantage: An integrated basket of employee benefits solutions that offer incomparable flexible benefits. Sound investment management that focuses on safety, stability and profitability of the portfolio. Personalized financial planning for your employee that takes care of his/her changingfinancial needs at every stage of life. Quality service initiatives and transparency across all operations, promising superlative operational efficiency.

Group Solutions Group Term Assurance: Helps provide affordable cover to membersof a group. Group Gratuity Plan: Helps employers fund their statutory gratuity obligation in a flexible and hassle-free manner. Group Superannuation Plan: A flexible scheme (defined benefit and defined contribution) to provide a retirementkitty for each member of the group.

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Group Term Assurance: BSLI flexible group term solution helps provide affordablecover to members of a group. The cover could be uniform or based on designation/rank or a multiple of salary, and can be extended to all employees between theages of 18 and 65 years. The benefit under the policy is paid on the event of the members death to the beneficiary nominated by the member. It is a one-year renewable policy where one master policy covers all proposed employees comprising the group, with a minimum group size of 25 persons. New members can join the groupand outgoing members can leave the group at any point during the policy term.

Highlights include: Greater convenience for the employees with relaxed underwriting and medical requirements. "Free Cover Limits" with simplified underwriting depending upon the number of employees in the group and the level of cover chosen. Guaranteed benefit: On death during the term of the contract (while in Service), the sum assured will be paid to the beneficiary of the employee. Choice of additional coverage in form an Accident and Disability Benefit Rider and CriticalIllness Cover Premium is viewed as a business expense in the year of payment.

Group Gratuity Plan: BSLI group gratuity plan helps employers fund their gratuity obligation in a scientific manner. Employers can avail of the tax benefits asapplicable to approved gratuity funds. The plan can also be customized to structure schemes that can provide benefits beyond the statutory obligations. Highlights include: Wider choice of investments with Market Linked Plans - to meet the diverse financial goals. We offer 4 investment options (short-term debt, debt andbalanced and capital guarantee plan) where investments will be made in accordan

ce with the fund objectives. Transparency through Daily disclosure of Unit Valueand regular disclosure of the portfolio of each of the investment option

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Flexibility through switching and contribution redirection option to enable reshuffling of portfolio Bundled Life Cover greater value to the employee by packaging life insurance covers with the gratuity, with minimal amount of underwriting. Actuarial services to provide a scientific estimation of the gratuity liability. Low explicit charge structure with the conditions for exit specified upfront. Enhanced service levels through faster claim settlement, easier access to information and regular statements. Complete end to end solution in the legal and regulatory approval process for scheme set up ortransfer

Employee Benefits: The contribution made by the employer is not included in thevalue of taxable perquisites in the hands of the employee. Gratuity received upto Rs 350000 is exempt from Income tax under Sec 10(10) Annual contribution up to 8.33% of salary bill in a financial year is allowed a deduction for the purpose of computation of profits and gains of business.

Contribution towards past service liability is allowed as deduction as per the Income Tax rules.Group Superannuation Plan: BSLI Superannuation Scheme (for both Defined Benefitand Defined Contribution funds) offers substantial benefits to both employers and employees. The employer and employee can avail of tax benefits applicable to an approved superannuation trust. The scheme will provide for a retirement fund for each participating employee. An employee would be able to choose from variousannuity options or opt for partial commutation of corpus at retirement.

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Highlights include: Wider choice of investments with Market Linked Plans to meetthe diverse financial goals. We offer 5 investment options (short-term debt, debt, balanced, growth and capital guarantee plan) where investments will be madein accordance with the fund objectives. Control - Each member/employer can exercise greater control over investments by choosing one or more of the investment options. Multiple Annuity Options - 5 annuity options and open market option Transparency - Transparency through Daily disclosure of Unit Value and regular disclosure of the portfolio of each of the investment option Flexibility - Flexibility through switching and contribution redirection option to enable reshuffling ofportfolio Low explicit charge structure with conditions for exit specified upfront. Enhanced service levels through faster claim settlement, easier access to information and regular statements. Complete end to end solution in the legal andregulatory approval process for scheme set up or transfer BSLI Rural Products are designed to meet the needs of the rural consumers. These products offer the following features: 1. Low and Affordable Premiums 2. Life Cover 3. Savings Option 4. Hassle free procedure

BSLI offers 2 specially designed rural plans. a) BSL I Endowment Plan b) BSLI -Regular Premium BSLI Endowment Plan: BSLI offers the following features:

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Rural Plans Life Cover and Savings Regular Premiums Age at entry 18 - 45 Yrs Premium Mode Half Yearly / Yearly Term 5,10,15 Yrs Sum Assured Rs.5,000 -20,000 Premium / Year Rs. 507 - 553 ( SA: Rs.10,000) Maturity/Death benefit Sum Assured

BSLI - Regular Premium: BSLI is a regular premium policy with the following features: Individual policy Only Life cover Term - 3 & 5 Yrs Age independent premium Age at entry 18 - 45 Yrs Sum Assured Single Premium / Year Rs 50 200 Maturity/Death benefit Rs.5,000 - 20,000 Death Benefit Sum Assured

IRDA: The insurance sector has been opened up in India, as there was an urgent need. The international experience indicates those country with a liberalized insurance sector have witnessed a rapid growth in premium volumes enhancing the domestic saving rate. This happened in China, Malaysia and Singapore where a competitive market has led to improvement in Services and quicker settlement of claims. And rightly therefore a decision was taken by the Government of India to openup Insurance sector. The establishment of IRDA in the month of April 2000 has been important development in this direction, making the end of monopoly in the insurance sector. 33

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WHY INSURANCE IN INDIA: Only 22% of the insurance population has been extended cover. Market penetration is low and the potential to exploit is high. Insurancepremium per capita is very low. Lack of comprehensive social system benefit andwelfare means that demand for pension products is high. Huge middle class of approximately 300 Million. Existing insurance company score low on customer servicefront. The insurance market registered growth in the Asian region even though Indias share in global insurance is less than 0.5% (1988) as compared to USA (24.2%) and Japan (21%). Studies have revealed that in an emerging market, as disposable income rises, Insurance premiums as a ratio of GDP shoots up. The confederation of Indian Industry projected a growth of Life Insurance premiums from Rs.350Billion at present to Rs.140 Billion. The Growth of non-life insurance premiumis expected to increase from 75 billion to 375 billion. Out of which, only 10% is tapped by the existing insurer. Insurance even more than banking is a volume game. A very exclusive approach in view is unlikely to provide meaningful numbers. Currently, insurance is bought for the purpose of taxbenefits. A higher percentage of business is in the rural market. The share of rural new Business insurance total new business is 55% in terms of policies and 47% in terms of sum assured. However, this needs to be viewed in the light of some recent issues that havebeen raised regarding as to what constitutes the rural market. Therefore, private insurers will be best served by middle market approach, targeting the customer segments that are presently unexploited. How many Indians are aware that LIC has more than 60 Products and GIC has more than 180 Products? Not only there is areduction in the premiums of Life Insurance products have long overdue since Indian morality rate has decreased three folds in the last 50 years. There is also

scope to increase the yield on life insurance policies (presently 6%) with proper risk management in place. It is been debated that insurance business does notproduce profit in the first five years cross subsidization is a feature of Indian market. Even the first portfolio vote that is considered

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profitable, cross subsidizes other departments. Tariffs reduction is likely to reduce profits; further insurers have to institute proper claims management progress in order to extract efficiencies. At present life insurance business in thecountry is taxed at 12.5% of the profit in financial year. The government is soon to present a new model of taxing life insurance companies at international rates. New entrants should be well advised to look ahead to the stage where brand strength will be a competitive advantage and sketch their alliances accordingly.In fact, we believe that alliance related to distribution rather than to produceor technology will prove most valuable in the long run. Banks and financial companies will emerge, as attractive distribution channel for this insurance trendwill be led by two factors, which already apply in other world market. First Banking food insurance, fund management and other financial services companies arebeing to increase their profitability and provide maximum value to their customers. Therefore, they are themselves looking for a range of products to distribute. In other market notably Europe; this has resulted in bank assurance. Bank entering into the insurance business in India to bank hope to maximize expensive existing network by selling a range of products more of a loss alliance between insurance and bank than a formal ownership. Some Indian entrants like ICICI, HDFC and Reliance hope to ride their existing network and customer bases.

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CHAPTER-2

REVIEW OF LITERATURE

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REVIEW OF LITERATURERamkumar D(2003) studied the role of relationship marketing in life insurance sector. In todays impersonal marketplace, customer satisfaction, retention and loyalty are rapidly become the thing of the past. Relationship marketing brings themback to the forefront, providing easyto-apply solutions and strategies for establishing meaningful bonds with customers and turning them into reliable, life-long partners. Relationship marketing can be defined as the process to identify andestablish, maintain and enhance and, when necessary, terminate relationships with customers and other stakeholders at a profit so that the objective of all parties involved are met; and this is done by mutual exchange and fulfillment of promises. The important objectives of relationship marketing are to acquire new customer s, maintain and enhance existing relationships with existing customers, reactivation of ex-customers, and handling of customer terminations. The key objective of relationship marketing is to establish a one to one relationship with all the customers. This may sound like a daydream few years ago; but thanks to thetechnology breakthrough and technological solutions providers it is very much of reality.

Rajesham Ch(2004) revised that insurance sector has not only been playing a leading role within the financial system in India but also has significant socio-economical function, making inroads into the interiors of the economy and is beingconsidered as one of the fast developing area in the Indian financial sector too. It has also been facilitating economic development with an objective to buildan efficient, effective and a stable insurance business in India as well as a st

rong base to both the needs of the real economy and socio-economic objective ofthe country. It has been mobilizing long term saving through lifeinsurance tosupport economic growth and also facilitating economic development, insurance cover to a large segment of people, while the non-life insurance and reinsurance firms in India are main providers of risk financing for manmade disasters and natural catastrophes. Thus, both life insurance and non-life insurance are found playing a significant role in avoiding or facing the risk of life and business enterprises and lso aiding to certain extents for their smooth sailing. Therefore,an attempt is made in this paper to highlight the developments of insurance sector in India in a phased manner and to examine the reasons for the entry of private and foreign insurance players into Indian insurance market and to present thechanging scenario of insurance business in India. It is also attempted to examine the growth of Indian insurance sector during the period of pre and post liber

alization and finally to 37

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suggest the strategies and challenges need to be adopted by Indian insurance sector in the light of global scenario so as to enhance its market share.

Mehra J(2005) studied that economic growth in the emerging markets has time andagain outpaced the developed and industrialized countries. Alongside the risingimportance of emerging economics, their life insurance sectors are also drawingmore attention. Its been four years since the life insurance sector was opened upfor private players in India. The reasons that prompted the government to bringin reform in this sector are well known. While the public sector life insurancecompanies made enormous contribution in the spread of awareness about insurance, and expanded the market, it was recognized that their reach was still limited,the range of product offered restricted to the services to the consumer inadequate. It was also felt that the rapid economic growth witnessed in the 90s couldntbe sustained without a thriving insurance sector. Today, the private accounts for nearly 20% of the market. The market share of the private players has to be seen in the context of this enlarged market. There has been a flurry of private players providing a wide range of innovation products, services and customized solutions. Emerging markets-such as China, India, Mexico, and Russia- are home tosome 86% of the worlds population. Collectively, they account for 23% of world economic output. Yet, insurance business is underdeveloped in these markets. In fact, India as a country is under-insured. Only 35% of the 250 million insurable population is insured. Exploiting the growth potential of emerging insurance market- India and China are in the spotlight. Both the countries currently attract alot of attention due to their size, strong growth performance and favorable reg

ulatory changes. To begin with, India and China are the most populous countriesand both have sustained impressive economic growth in the last decade. Between 1993 and 2003, annual real GDP growth averaged 8.9% in china and 5.9% in India. Interestingly, both markets have gone through a similar period of nationalizationof their insurance business, although China revoked state monopoly earlier thanIndia.

Calandro j, J flynn R (2005) studied that many insurance companies vigorously pursue top-line growth, even though it has the potential to develop unprofitably over time. The time lag(or tail) between when insurance is sold and when claims are paid generates risks unique to insurance

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companies. Furthermore, the insurance market is both mature and efficient (i.e.its level of completion is very high), which means that profitable opportunitiesare both rare and untenable unless protected by competitive advantage. There currently no practical measure available ( of which the authors are aware ) at thebusiness unit level to evaluate insurance premium growth in the face of the industrys risk, impairing executives ability to assess segment opportunities (and hazards), thus hampering strategies decision making. The purpose of this paper is to introduce a practical measure developed by the authors called Underwriting Return (UWR) which aims at helping to alleviate this situation. The paper introduces UWR which was developed during the course and scope of the authors work in theinsurance industry, and their research into applying value-based management to that industry. The paper finds that UWR is a practical measure that property andcasualty executives can use at the business unit level to help quantify market segments to grow, hold, harvest and abandon. A variety of strategies analysis tools, such as the popular Boston Consulting Group matrix, are utilized today. In general, the application of such tools is hampered by an imprecision of measurement but each can add a level of insight to executive resource allocation options.UWR can further aid insurance executive in strategic analysis by helping to quantify in which segments to compete, and which ones to abandon. The paper demonstrates the utility of the measure in an example based on an actual analysis.

Anon (2005) studied all the aspects of the Indian insurance industry along withan outlook for potential developments. The report examines the trends in industry, besides the competitive landscape offers a brief analysis on the main players

in the industry. It contains an assessment based on PEST analysis, covering therelevant political, economic, social and technological factors that have implications for the development of the industry. The report also evaluates the industry within th Michael porter framework. It goes on to describe the competitive landscape and provides a comparative financial study of the major players in the industry. Insurance constitutes an important and increasing proportion of the gross financial savings of the household sector in india. The private sector, in life as well as the non-life segments gained more

prominent in the life insurance sector. The factors that have driven change include: > Increasing Gross Financial Household Savings. > Deregulation in the Indian Insurance Market. > Increase in dependency ratio However, dearth of new products represents a major implication.

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Sethi N (2005) studied the concept of banc assurance in India. Banc assurance has mostly been a phenomenal success and , although slow to gain pace, is now taking off across Asia, especially now that banks are starting to become more diverse financial institutions, and the concept of universe banking is being accepted.In India, the signs of initial success are already there despite the fact thatit is completely new phenomenon. The factor and principles of why it is a success elsewhere exists in India, and there is no doubt that banks are set to becomea significant distributor of insurance related products and services in the years to come.

Rao (2005) analyzed that the insurance industry has grown by 83 percent since the opening up the sector. Remarking on the performance of the insurance industry,C S Rao, chairman, insurance regulatory & development authority, said public sector players have not suffered with the opening up of the sector. Insurance premium income has risen to Rs 82,415 crore (Rs 824.15 billion) in 2003-2004, against Rs 45,000 crore (Rs 450 billion) in 2000-01. Rao expects premium income in thelife insurance sector to rise further by 15-16 percent and non-life insurance premium by 14 percent in 2005-06. The growth comes on the back of healthy demandfrom the manufacturing sector.

Kannan k.v (2006) reviewed in their study that the market potential for privateinsurance companies is found to be greater in the long run as most of the Indians are of the opinion that, private insurance companies would be able to performwell in the future. The private and foreign insurance companies have too immedia

te steps in appointing more number of agents and/or advisors in addition to theemployees as it has found that agents are the best channel to reach the generalpublic regarding selling of insurance products. The private and foreign insurance companies have to concentrate on the factors like prevention of loss, assured returns and long term investment. They can also focus on an insurance amount of Rs. 1-2 lakhs with money back policies. Hence, the market has potential. The private andforeign insurance companies that are taking immediate steps can tap it.

Sasidharan Sanjeev (2006) studied that the insurance sector in India has come afull circle from being an open competitive market to nationalization and back toa liberalized market again.

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Tracing the developments in the Indian insurance sector reveals the 360-degree turn witnessed over a period of almost two centuries.

Athma Prashanta(2007) reviewed that in globalization policy, insurance company face a dynamic global business environment. The existing insurers are facing challenges from nontraditional competitors who are entering into the retail market with new approaches and through new channels. While quality of service is the main influencing factor in the finance market, in the insurance market, product attributes are the main factors that influence the success of insurance companies.Though, there has been growth in life insurance industry over the past few years, comparatively, insurance penetration in India has not increased in spite of the considerable growth potential of Indian life insurance market. With liberalization, many insurance players have entered this field from the year 2000, and thetask before them now is to identify what factors influence in decision-making.In this context, this study assumes importance. The main objective of the paperis to identify the factor s which the consumers take into consideration before selecting life insurance products and determine the extent to what these factorsare taken into consideration for choosing the life insurance products. This research is carried out by collecting primary data from 200 policyholders of Life Insurance Corporation on India through self-structured questionnaires. The sampleconsists of 100 policyholders from urban area and 100 policyholders from rural area. C2 test is employed to test if there is any association is used to find outwhich factor has more influence. Both, product and non-product attributes havebeen found to be important in selecting a policy but they have been rated differ

ently. Rating is different in urban and rural areas.

Hsieh An (2008) investigated the relationship between customer perception of public relations (PR) and customer loyalty to test for the moderating role of brandimage in that relationship. Data were collected in a survey of customers of theinsurance industry in Taiwan, using a questionnaire designed on the basis of focus-group discussions with 30 consumers. Hierarchical regression analysis of data from 367 respondents was used to test two hypotheses. The results show that consumers perception of an organizations PR practice is an antecedent of loyalty. The impact of public relation perception (PRP) on customer loyalty is stronger andmore significant when the brand image is favorable. The effect of PRP on customer loyalty is

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negligible. This study extends previous research by examining the moderate of brand image. Further research is indicated, to identify the key moderators of thedriving force of PR in relation to customer relationship marketing. This paper proposes an original eight-item scale for the assessment of customer PRP activity, which can be applied in practice to measure its effectiveness under differentbrand-image conditions.

Andreassen Tor (2008) studied the impact of customers perception of customer service (bad/good) on variables that are known to drive revenue, i.e. customer satisfaction, perceived relative attractiveness, and commitment. Data were collectedthrough a survey among bank customers. Two groups were sampled: customers who have experienced good or bad customer service. The hypotheses were tested by applying structural equation modeling and running two group analysis using the PLS and LISREL softwares. Customers that experience bad customer service do take into account the same variables in their evaluation as do customers that experience good customer service. They do however, put different weights on every factor in the evaluation process. Also the strength of the relationship between the variables seems to differ. Typically, analyses showed that customers experiencing bad customer service tend to consider more thoroughly all aspects of the service; therelationships between the variables were stronger and the explained variance ofeach construct higher, than in the group of customers experiencing good customer service. However, the paths are not different across the groups. The paper hasonly tested the model and hypothesis in one industry. Future research should test the same model using different industries reflecting different customer invol

vement levels. Practical implications from this study, service managers can learn that investing in customer service in ongoing customer relations is the right thing to do as it is linked to customer equity through customers commitment to thefirm. Second, as customer service in such relationships drives perceived relative attractiveness, saving the bottom line by cutting back on the human side of the customer interaction, may harm the firms competitive position in the marketplace.

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CHAPTER-3

NEED, SCOPE & OBJECTIVES OF THE STUDY

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NEED SCOPE & OBJECTIVE OF THE STUDYNEEDLife insurance is chiefly a risk management tool, meant to offer financial protection to your dependents in the unfortunate event of your death. But in India, as the most other developing market, life insurance has come to present more thanjust risk cover. This particular study is conducted on the topic titled to studycustomer perception regarding Birla sun life insurance company. The aim of thisresearch study is to know about life insurance. It is done to know the banc assurance in India. Banc assurance has mostly been a phenomenal success and, although slow to gain pace, is now taking across Asia, especially now that banks are starting to become more diverse financial institutions, and the concept of universal banking is being accepted. In India, the signs of initial success are already there despite the fact that it is a completely new phenomenon.

SCOPEThe study is restricted to Navi-Mumbai region only. The study also analyses thepreferences regarding different life insurance policies of Birla-sun life insurance. For this study 100 respondents of Navi-Mumbai are chosen. Now days there are lot of private companies in market so its important to know what motivates thecustomer to buy the policy. Birla sun life is the fastest growing private insurance company in India. It determines market share of the various private companies in India.

OBJECTIVES

To determine and analyze the Market Potential of the Birla Sun Life Insurance Company. To determine whether the customers are satisfied with the policies of thecompany. To know the the customer awareness regarding the Birla-sun life insurance and its products. To study and determine the competitor position in the market. To know the future plans of the people for buying the policies. Proper understanding and analysis of life insurance industry.

Conduct market survey on a sample selected from the entire population and derived opinionon that research

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CHAPTER-4

RESEARCH METHODOLOGY

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Research methodologyResearch means a search for knowledge or gain some new knowledge and methodologycan properly refer to the theoretical analysis of the methods appropriate to afield of study or to the body of methods and principles particular to a branch of knowledge. Research Design : A research design is the arrangement of conditions for the collections and analysis of data in a manner that aims to combine relevance to research purpose with economy in procedure. Universe The universe of the study is Navi-Mumbai. Sample Unit The sample unit pertaining to the study is 100 respondents of Navi-Mumbai region. Sample Size The sample size of 100 servedthe purpose of the study. Sample Method The sampling method used is non-probability convenience sampling

Methods of data collection

Data collectionThe word data means any raw information, which is either quantitative or qualitative in nature, which is of practical or theoretical use. The task of data collection begins after a research problem has been defined and research design chalked out. While deciding about the method of data collection, the researcher should keep in mind that there are two types of data primary and secondary.

Primary dataThis is those, which are collected afresh and for the first Time, and thus happen to be original in character. There are many ways of data collection of primary

data like observation method, interview method, through schedules, pantry Reports, distributors audit, consumer panel etc. The Team Managers and employees of both the Department were consulted to get information about procedure of both theonline and off line share trading. But the method used by us for the primary data collection was through questionnaires.

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Questionnaire methodFor the collection of primary data I used questionnaire method. A formal list ofquestions, which are to be asked, is prepared in a questionnaire and questionsare asked on those bases. There are some merits and demerits of this method. These as under: Merits: 1. Low cost even when universe is large. 2. It is free frombias of interviewer. 3. Respondents have proper time to answer. 4. Respondentswho are not easily approachable can also be reachable. 5. Large samples can be made.

Secondary dataThese are those data, which are not collected afresh and are used earlier also and thus they cannot be considered as original in character. There are many waysof data collection of secondary data like publications of the state and centralgovernment, reports prepared by researchers, reports of various associations connected with business, Industries, banks etc. And the method, which was used by us, was with the help of reports of the company.

Sample SizeI have met 250 people, to know about their perception regarding companies and there policies after that I have taken 25 People they have fill up the questionnaire and given response.

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LIMITATIONS OF INSURANCE Lack of awareness among the people This is the biggest limitation found in thissector. Most of the people are not aware about the importance and the necessityof the insurance in their life. They are not aware how useful life insurance canbe for their family members if something happens to them. Perception of the people towards Insurance sector People still consider insurance just as a Tax saving device. So today also there is always a rush to buy an Insurance Policy only at the end of the financial year like January, February and March making the other 9 months dry for this business. Insurance does not give good returns Still today people think that Insurance does not give good returns. They are not aware ofthe modern Unit Linked Insurance Plans which are offered by most of the Privatesector players. They are still under the perception that if they take Insurancethey will get only 5-6% returns which is not true nowadays. Nowadays most of the modern Unit Linked Insurance Plans gives returns which are many times more than that of bank Fixed deposits, National saving certificate, Post office depositsand Public provident fund. Lack of awareness about the earning opportunity in the Insurance sector People still today are not aware about the earning opportunity that the Insurance sector gives. After the privatization of the insurance sector many private giants have entered the insurance sector. These private companies in order to beat the competition and to increase their Insurance Advisors toincrease their reach to the customers are giving very high commission rates butpeople are not aware of that. Increased competition Today the competition in theInsurance sector has became very stiff. Currently there are 14 Life Insurance companies working in India including the LIC (life insurance Corporation of India

). Today each and every company is trying to increase their Insurance Advisors so that they can increase their reach in the market. This situation has created ascenario in which to recruit Life insurance Advisors and to sell life InsurancePolicy has became very- very difficult.

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CHAPTER-5

DATA ANALYSIS AND INTERPRETATION

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DATA ANALYSIS AND INTERPRETATION1.Which Birla life plan do you have? Table 5.1 : Type Of Plan Types of plan Lifeinsurance plan Health insurance plan Retirement plan Total No of respondent 6810 22 100 Percentage 68% 10% 22% 100%

Figure. 5.1 : Type Of Plan

Analysis & Interpretation: The objective of first question was people having anaccount with BSLI are having which type of plan. In the survey of 100 people itwas found that 68% have life insurance plan, 22% have retirement plan and 10% were having health insurance plan. 50

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2.Are you satisfied with the plan you have? Table 5.2 : Satisfaction With The Plan People satisfied with plan Yes No Total No of respondent 72 28 100 Percentage72% 28% 100%

Figure 5.2 : Satisfaction With The Plan

Analysis & Interpretation: The objective of second question was to find out thathow many people are satisfied with the plan. In the survey of hundred people itwas found that 72% people are satisfied with the plan while 28% people are notsatisfied with the plan.

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3.Are you satisfied with the service provided by the company about new schemes and plansTable 5.3 : Satisfaction With The Services Of The Company

Are people satisfied with service provided by company Yes No Total

No of respondent

Percentage

82 18 100

82% 18% 100%

Figure 5.3 : Satisfaction With The Services Of The Company

Analysis & Interpretation: The objective of third question was to find out whether people are satisfied with the services provided by the company. In the surveyit was found that 82% people are satisfied with the services provided by the company while 18% people are not satisfied with the services.

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4.Are you interested to make more investments in BSLI?Table 5.4 : People Want To More Investment In Bsli People want to more investment in BSLI Yes No Total No of respondent 67 33 100 Percentage 67% 33% 100%

Figure 5.4 : People Want To More Investment In Bsli

Analysis & Interpretation: The objective of fourth question was to find out thatdo people want to invest more money. It was found that 67% people want to invest more money while 33% people dont want to invest more money.

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5.Number of people have other insurance plan apart from BSLI Table 5.5 : PeopleHave Other Insurance Plan Apart From Bsli People have other insurance plan apartfrom BSLI Yes No Total 78 22 100 78% 22% 100% No. of people Percentage

Figure 5.5 : People Have Other Insurance Plan Apart From Bsli

Analysis & Interpretation: The objective of fifth question was whether people have insurance plan apart from BSLI. In the survey it was found that 78% people have insurance plan other than BSLI while 22% dont have any other plan.

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6.Percentage share of different companies in insurance sector. Table 5.6 : Shareof different companies Name of different companies Life insurance company BirlaSun Life Insurance Bajaj Aliyanz ICICI Other Total Percentage 60% 9% 11% 8% 12%100%

Figure 5.6 : Share of different companies

Analysis & Interpretation: The objective of this study is to find out the percentage share of different companies in the insurance sector. it was found that 60%is occupied by LIC,9% by BSLI,11% by Bajaj aliyanz,8% by ICICI and 12% by othercompanies.

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7.Market share of private companies. Table 5.7 : Market share of private companies List of companies ICICI pru Bajaj Alliaz SBI HDFC standard Birla sun life insurance Reliance life Max new York Tata AIG Aviva Kotak Mahindra Met life ING vysya Shriram life Other Total Percentage 22.1% 13.8% 9.8% 7.7% 7.0% 8.0% 8.0% 7.0%3.1% 3.6% 5.3% 2.1% 1.1% 1.1% 100%

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Figure 5.7 : Market share of private companies

Analysis & Interpretation: The objective of this study is to find out the marketshare of different companies in the insurance sector. It was found that icici pru is having the maximum share that is 22.1%.

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CHAPTER-6

FINDINGS OF THE STUDY

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FINDINGS To be successful in marketing of insurance products, the entire business scenario has to be taken into account. During the study to be found that majority of people are aware of life insurance sector. During the survey it was observed thatmajor source of information for consumer are television and newspaper and leastpreference are given to magazines, agents and friends. Attractive schemes and brand image are the most important factor that influences the buying behavior of the consumers. Majority of respondents will shift to any other insurance company. People are not satisfied with the opted insurance. It was found that the reasonfor the dissatisfaction of consumer is high premium, delay in claim settlementand poor after sale service. So to achieve a greater insurance penetration, insurance sector companies have to create a more vibrant and competitive industry, with greater efficiency, choice of products and value for customers.

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CHAPTER-7

SUGGESTIONS

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SUGGESTIONS1) Information regarding new product should be provided to the customers.

2) The company should find out the no. of people who are not having any of the insurance plans through an intensive market research and motivate them to get insured. 3) At some level Company should provide information to the customers aboutthe charges of the policy. 4) Company should target each and every class of thesociety. 5) Charges should be low of the policies. 6) Annual premium should bereasonable. 7) BSLI Company should work in systematic way.

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CHAPTER-8

LIMITATIONS

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LIMITATIONS

Some of the respondents were not cooperative. There are chances of biased information provided by the

respondents. As the sample size is small compared to the total population, therefore there cant be full accuracy. The time was limited. Area was limited.

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CHAPTER-9

CONCLUSION

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CONCLUSION

The market potential for private insurance companies is found to be greater in the long run as most of the Indians are of the opinion that, private insurance companies would be able to perform well in the future. The private and foreign insurance companies have to take immediate steps in appointing more number of agents and/or advisors in addition to the employees as it has been found out that agents are the best channel to reach the general public regarding selling of insurance products. The private and foreign insurance companies have to concentrate onthe factors like 'Prevention of Loss', 'Assured Returns' and 'Long term Investment'. They can also focus on an insurance amount of Rs. 1 2 lakhs with 'money back policies'. Hence, the market has potential. The private and foreign insurancecompanies that are taking immediate steps can tap it easily & rapidly.

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CHAPTER-10

RECOMMENDATIONS

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RECOMMENDATIONS1) Even though most of the policy holders are satisfied with policies, plans they have but some new attractive insurance plans should be introduce to bind themnot to switch over to other companies insurance plans. 2) The company should find out the no. of people who are not having any of the insurance plans through anintensive market research and motivate them to get insured. 3) Leveraging technology to service customers quickly, efficiently and conveniently. 4) Developingand implementing superior risk management and investment strategies to offer sustainable and stable returns to our policyholders. 5) Company should target eachand every class of the society 6) Company should provide full information to thecustomers before targeting so they can take interest.

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CHAPTER-11

BIBLIOGRAPHY

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BIBLIOGRAPHY

Books : y Kothari C.R. (1990) Research Methodology : Method and Techniques, Wishva Parkashan, New Delhi. PP115-117 y Bodie. Z, Kane. A & Marcus. J : Essentialsof Investments PP242-243

Websites : y y y y y http://www.economywatch.com/indianeconomy/indian-insurance-sector.html www.birlasunlife.com/birlasunlife/insurance/bsli.../index5.aspx http://www.indianmba.com/Occasional_Papers/OP85/op85.html http://www.banknetindia.com/finance/insure2011.htm http://www.financialexpress.com/news/the-indian-insurance-sector-ii/181428/

Journals : y Lect. D.ramkumar(2003), Relationship Marketing The new tantra for life insurance sector. Department Of Management Studies, N.M.S.S. Vallaichamy NadirCollege, Nagamalai, Madurai 625019 available at http://www.google.co.in/interstitial?url=http://www.indiaschools.com/marketing_029.ht m last accessed on 07-08-2009. y Dr. Ch.rajesham (2004), changing scenario of india insurance sector, department of commerce & Business Management, University P G college, Kakatiya University Khammam, Andhra Pradesh available at http://www.insuranceinstituteofindia.com/insuranceinst/publication/uploads/journal-janjun-04/chapter10..pdf last accessed on 14-08-2009 y J.Mehra (2005), innovations in life insurance industry, the financial express, new delhi available at http://www.financialexpress.com/news/innovations-in-life-insurance-industry last accessed on 15-08-2009.

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CHAPTER-12

ANNEXURE

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QuestionnaireName:............................... Age:.. Occupation:.. Ques.1 Which Birldo you have? Health Retirement Life Health Retirement Life Ques.2 Are you satisfied with the Insurance plan you have? (a) Yes (b) No

Ques.3 what attract you towards Birla Sun Life Plans? (a) (b) (c) (d) Ques.4 Areyou satisfied with the services provided by the company Regarding new plans andschemes? (a) Yes (b) No

Ques.5 Are you interested to make more investments in Birla Sun Life ? (a) Yes (b) No

Ques.6 Have you any other Insurance Plan apart from Birla Sun Life? (a) Yes (b)No

Ques.7 If yes, then of which Life Insurance Company? (a) LIC (c) Birla Sunlife (e) Others (b) Bajaj Allianz (d) Reliance

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Ques.8 If you get any attractive plan than are you ready to switch over? (a) Yes(b) No

Ques.9 If you get any attractive plan than are you ready to switch over? (a) Yes(b) No

Suggestions:

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46554162 Pankaj Report

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