Project Report

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WEST BENGAL UNIVERSITY OF TECHNOLOGY

SUMMER PROJECT REPORT

ON

“CHANNEL DEVELOPMENT IN INSURANCE BUSINESS& SALES OF LIFE INSURANCE PRODUCTS”

AT

AGRA

BY

VIPIN KUMARREGISTRATION No: 111360710116 of 2011-2012

ROLL No: 13600911116

ARMY INSTITUTE OF MANAGEMENT, KOLKATA

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ACKNOWLEDGEMENT

This project has been a learning experience for me and I would like to expressmy gratitude towards all those people who guided and supported me throughoutand without whose support the execution of the tough task at hand would nothave been successful.

I would specially like to thank my guide at Reliance Life Insurance Limited,Agra, Mr. Kailash Singh Parmar, Area Manager and Mr. Vishnukat Gupta,Sales Manager, for their continuous support, encouragement and guidanceduring the project.

I express sincere gratitude to my internal project guide Prof. MadhusudanNandan of Army Institute of Management, Kolkata, who has been a source ofknowledge and inspiration and a strong support during the project tenure.

I would like to thank all those people have directly and indirectly been useful tome for the successful completion

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GUIDANCE CERTIFICATE

This is to certify that Mr. Vipin Kumar, WBUT Registration No. :

111360710116 of 2011–2012, WBUT Roll Number 13600911116 , has undertaken

the project titled “Channel Development in Insurance Business” under our

guidance from 6th

June 2012 to 5th

July 2012 at Reliance Life Insurance Ltd.

Agra and has completed the said project successfully.

External GuideKailash Singh ParmarArea ManagerReliance Life Insurance, Agra

Organization’s Seal

Internal Guide:Dr. Madhusudan NandanAIM, Kolkata

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CONTENTS

Executive Summary ………………………………………………………………………... 5

CHAPTER 1: INTRODUCTION

1.1 Industry Profile ………………………………………………………………... 6

1.2 Company Profile ………………………………………………………………. 12

CHAPTER 2: PROJECT DETAILS

2.1 Objective ………………………………………………………………………. 16

2.2 Literature Review …………………………………………………………….... 17

2.3 Purpose of the project & scope of the study ……………………………...…… 20

2.4 Research Methodology ………………………………………………………… 21

CHAPTER 3: PROJECT FINDINGS & ANALYSIS

3.1 SWOT Analysis ………………………………………………………………. 35

3.2 Findings ………………………………………………………………………. 37

3.3 Conclusion ……………………………………………………………………. 38

3.4 Recommendation …………………………………………………...………… 39

3.5 Limitations ……………………………………………………………………. 40

Bibliography …………………………………………………………………………….. 41

Appendix ……………………………………………………………………………….... 42

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EXECUTIVE SUMMARY

In today’s corporate & competitive world, I find that Insurance sector has the maximumgrowth and potential as compared to other sectors. Insurance has the maximum growth rate of70% - 80% while as FMCG sector has maximum 12% - 15% growth rate. This growthpotential attracts me to enter in this sector and RELIANCE LIFE INSURANCE has given methe opportunity to work and get experience in highly competitive and enhancing sector.

The success story of good market share of different market organizations depend on theavailability of the products and services near to the customer, which can be distributedthrough a distribution channel. In Insurance sector, distribution channel includes only agentsor agency holders of the company. If a company like RELIANCE LIFE INSURANCE,TATA AIA, MAX LIFE etc. have adequate agents in the market they can capture big marketas compare to the other companies. Agents are the only way for a company of Insurancesector through which policies and benefits of the company can be explained to the customer.

The project “Market segmentation of Channel Development in Insurance & Sales” wascarried out in mind with the following focus areas:

• To understand the role of Insurance agents in the Insurance sector. To know the IRDArequirements for an agent. Understanding the company’s expectations from an agent.Contacting the potential candidates who would be willing to be an agent. Contactingpotential candidates who are not willing and analyzing the reasons for unwillingness.Convincing candidates to become agents(life advisors) for Reliance Life InsuranceLtd. Ensuring proper documentation of clients for log-in. following up till the IRDAexamination was taken.

The steps that were followed to fulfill the said objectives are summarized as follows:

• Recognizing potential candidates from personal contact base on the basis of IRDA andCompany requirements. Conducting an ‘umbrella activity’ to generate leads.Telephone calls to candidates informing them about the role and benefits of being anInsurance agent. Following up with interested candidates through personal visits andtelephone calls. Handling any objections in the minds of the candidates pertaining tothe role of a life advisor. Setting up interviews with the appropriate authority in thebranch office. Ensuring candidates possess necessary documentation and finances forlog-in. Assisting candidates till IRDA examination. Many obstructions in the form ofpeoples’ perceptions were met with. The number of people contacted and the numberof people willing to become agents differed considerably. The work required a highdegree of patience, good communication skills and a good convincing power.

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1.1 INSURANCE SECTOR

Insurance has a deep-rooted history in India. It finds mention in the writings of ancient‘Shastras’. The writings talk in terms of pooling of resources that could be re-distributed intimes of calamities such as fire, floods, epidemics and famine. This was probably a pre-cursorto modern day insurance. Ancient Indian history has preserved the earliest traces of insurancein the form of marine trade loans and carriers’ contracts. Insurance in India has evolved overtime heavily drawing from other countries, England in particular. Insurance providesindemnity, or reimbursement, in the event of an unanticipated loss or disaster. There aredifferent types of insurance policies and one can get cover for almost anything that one mightthink of.

1818 saw the advent of life insurance business in India with the establishment of the OrientalLife Insurance Company in Calcutta. This Company however failed in 1834. In 1829, theMadras Equitable had begun transacting life insurance business in the Madras Presidency.1870 saw the enactment of the British Insurance Act and in the last three decades of thenineteenth century, the Bombay Mutual (1871), Oriental (1874) and Empire of India (1897)were started in the Bombay Residency. This era, however, was dominated by foreigninsurance offices which did good business in India, namely Albert Life Assurance, RoyalInsurance, Liverpool and London Globe Insurance and the Indian offices were up for hardcompetition from the foreign companies.

In 1914, the Government of India started publishing returns of Insurance Companies in India.The Indian Life Assurance Companies Act, 1912 was the first statutory measure to regulatelife insurance business.

Government to collect statistical information about both life and non-life business transactedin India by Indian and foreign insurers including provident insurance societies. With a viewto protect the interest of the Insurance public, the earlier legislation was consolidated andamended by the Insurance Act, 1938 with provisions for effective control over the activitiesof insurers

The Insurance Amendment Act of 1950 abolished Principal Agencies. However, there were alarge number of insurance companies and the level of competition was high. There were alsoallegations of unfair trade practices. The Government of India, therefore, decided tonationalize insurance business.

An Ordinance was issued on 19th January, 1956 nationalizing the Life Insurance sector andLife Insurance Corporation came into existence in the same year. The LIC absorbed 154

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Indian, 16 non-Indian insurers as also 75 provident societies—245 Indian and foreigninsurers in all. The LIC had monopoly till the late 90s when the Insurance sector wasreopened to the private sector.

In 1993, Malhotra Committee, headed by former Finance Secretary and RBI GovernorR.N.Malhotra, was formed to evaluate the Indian insurance industry and recommend itsfuture direction. The Malhotra Committee was set up with the objective of complementingthe reforms initiated in the financial sector.

The committee recommended throwing open the sector to private players to usher incompetition and bring more choice to the consumer. The objective was to improve thepenetration of insurance as percentage of GDP, which remains low in India even compared tosome developing countries in Asia.

Reforms were initiated with the passage of Insurance Regulatory and Development Authority(IRDA) Bill in 1999. IRDA was set up as an independent regulatory authority, which has putin place regulations in line with global norms.

A thriving insurance sector is of vital importance to every modern economy. First, because itencourages the savings habit and second, because it provides a safety net to rural and urbanenterprises and productive individuals. In addition, perhaps most importantly it generateslong-term investable funds for infrastructure building.

The nature of the insurance business is such that the cash inflow of insurance companies isconstant while the payout is deferred and contingency related. This characteristic of theirbusiness makes insurance companies the biggest investors in long gestation infrastructuredevelopment projects in all developed and aspiring nations. This is the most compellingreason why private sector (and foreign) companies which will spread the insurance habit inthe societal and consumer interest are urgently required in this vital sector of the economy.

The insurance sector in India has come a full circle from being an open competitive market tonationalization and back to a liberalized market again. Tracing the developments in the Indianinsurance sector reveals a 360-degree turn witnessed over a period of almost two centuries.

India, with about 200 million middle class households, presents a huge untapped potential forplayers in the insurance industry. Saturation of markets in many developed economies hasmade the Indian market even more attractive for global insurance majors.

With per capita income in India expected to grow at over 6% for the next 10 years and withimprovement in awareness levels, the demand for insurance is expected to grow at anattractive rate in India. A study shows that life insurance market will grow from Rs.218billion in 1998 to Rs.1003 billion by 2008(a compounded annual growth of 16.5%).

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Introduction of new players

The initiatives taken by the private players are very competitive and have given immensecompetition to the one time monopoly of LIC. Since the advent of the private players in themarket the industry has seen new and innovative steps taken by the players in this sector. Theservice quality of the insurance industry has improved. Though LIC still holds 70% of themarket share, the private players are giving close competition to LIC.

Reforms have marked the entry of many of the global majors into the Indian market in theform of joint ventures with Indian companies. Some of the key names are TATA AIA, MaxLife, Allianz, Prudential, Standard Life, Sun Life Canada and Old Mutual. LIC has respondedto the competition in an admirable fashion by launching new products and improving servicestandards. Following are the key winds of change brought about by privatization.

• Market Expansion: There has been an overall expansion in the market. This hasbeen possible due to improved awareness levels thanks to a large number ofadvertising campaigns launched by all the players. The scope for expansion is stillunlimited as virtually all the players are concentrating on large cities and townsexcept by LIC to an extent there was no significant attempt to tap the rural markets.

• New Products on Offer: There has been a plethora of new and innovative productsoffered by the new players, mainly their international partners. Customers havechoices from a large variety of products from pure term (risk) insurance to unit linkedinvestment products.

• Customer Service: This is an area that has witnessed the most significant changeswith the entry of new players. There is an attempt to bring in international bestpractices in service and operational efficiency through the use of latest technologies.Advice and need based selling is emerging through much better trained sales forceand financial consultants. There is improvement in response and turnaround times inspecific areas such as delivery of first policy receipt, policy document, premiumnotice, final maturity payment, settlement of claims etc. However, there is a long wayto go and various surveys indicate that the standards are still below internationalstandards.

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• Channels of Distribution: Until two years back, the only mode of distribution of lifeinsurance products was through agents. While agents continue to be the prominentdistribution channel, today a number of innovative alternative channels are beingoffered to consumers. Some of them are bancassurance, brokers, the internet anddirect marketing. The approval of institutions for imparting training to agents has alsoensured that the insurance companies would have trained workforce of insuranceagents to sell their products.

Growth of Indian Life Insurance Sector

One of the premium sectors showing upward growth is insurance, which is a US$ 41-billionindustry in India. India is the fifth largest life insurance market in the emerging insuranceeconomies globally and is growing at 32-34 per cent annually. With increasingcompetitiveness amongst these, the players are bringing out newer products to attract morecustomers into their kitty. Foreign direct investment (FDI) up to 26 per cent is permittedunder the automatic route subject to obtain a licence from the official regulator, InsuranceRegulatory and Development Authority (IRDA). The total number of life insurancecompanies operating in India is currently 22. Two major factors impacting the generalinsurance segment are the detariffing of interest rates by Insurance Regulatory DevelopmentAuthority (IRDA), which gave autonomy to insurers in pricing insurance policies and hascreated a competitive field in general insurance business, the second being the financialmeltdown, which has also mad.

Life Insurance

Essentially life insurance provides financial protection to the family and dependents of theinsured in the event of any unforeseen event or untimely death. To cover one under a lifeinsurance policy, an insurance company charges a certain sum of money (called the premium)periodically. The premium paid helps cover the risk that the life insurance company takes byinsuring a person’s life and in turn entitles his/her family to receive a fixed lump sum.

The premium paid depends on a variety of factors including age, health and the amount oflife cover to name a few.

However, premiums are typically lower for younger, healthier people, so starting early isalways beneficial.

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Life Insurers : Aegon Religare, Aviva, Bajaj Allianz, Bharti AXA, Birla SunLife,Canara HSBC, DLF Pramerica, Future Generali, HDFC Standard, ICICI Prulife, IDBIFortis, IndiaFirst, ING Vysya, Reliance Life, Max Life, Metlife, Reliance, Sahara, SBILife, Shriram, Star Union Diachi, Tata AIA, Edelweiss Tokio Life Insurance Co. Ltd LIC.The number of non-life insurers has increased to 24.

Basic functions of Insurance

• Primary Functions

• Secondary Functions

• Other Functions

Primary functions of insurance:

• Providing protection – The elementary purpose of insurance is to allow securityagainst future risk, accidents and uncertainty. Insurance cannot arrest the risk fromtaking place, but can allow for the losses arising with the risk. Insurance is in reality aprotective cover against economic loss.

• Collective risk bearing – Insurance is an instrument to share the financial loss. It isa medium through which few losses are divided among larger number of people. Allthe insured add the premiums towards a fund and out of which the person facing aspecific risk is paid.

• Evaluating risk – Insurance fixes the likely volume of risk by assessing diversefactors that give rise to risk. Risk is the basis for ascertaining the premium rate aswell.

Secondary functions of insurance:

• Preventing losses – Insurance warns individuals and businessmen to embraceappropriate devices to prevent unfortunate aftermaths of risk by observing safetyinstructions eg: installation of automatic sparkler, alarm systems.

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• Covering larger risks with small capital – Insurance assuages the businessmenfrom security investments. This is done by paying small amount of premiumagainst larger risks and dubiety.

• Helps in the development of larger industries–Insurance provides anopportunity to develop to larger industries which have more risks in their settingup.

Other functions of insurance:

• A savings and investment tool – Insurance is the best savings and investmentoption, restricting unnecessary expenses by the insured. Also to take the benefit ofincome tax exemptions, people take up insurance as a good investment option.

• Medium of earning foreign exchange – Being an international business, anycountry can earn foreign exchange by way of issue of marine insurance policies.

• Risk Free trade – Insurance boosts exports insurance, making foreign trade riskfree with the help of different types of policies under marine insurance cover.

.

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1.2 COMPANY PROFILE

Few men in history have made as dramatic a contribution to their country’s economicfortunes as did the founder of Reliance, Shri. Dhirubhai H Ambani. Fewer still have leftbehind a legacy that is more enduring and timeless.

As with all great pioneers, there is more than one unique way of describing the true genius ofDhirubhai: The corporate visionary, the unmatched strategist, the proud patriot, the leader ofmen, the architect of India’s capital markets, the champion of shareholder interest.

But the role Dhirubhai cherished most was perhaps that of India’s greatest wealth creator. Inone lifetime, he built, starting from the proverbial scratch, India’s largest private sectorenterprise.

When Dhirubhai embarked on his first business venture, he had a seed capital of barely US$300 (around `14,000). Over the next three and a half decades, he converted this fledglingenterprise into a ` 60,000 crore colossus—an achievement which earned Reliance a place onthe global Fortune 500 list, the first ever Indian private company to do so.

Dhirubhai is widely regarded as the father of India’s capital markets. In 1977, when RelianceTextile Industries Limited first went public, the Indian stock market was a place patronisedby a small club of elite investors which dabbled in a handful of stocks.

Undaunted, Dhirubhai managed to convince a large number of first-time retail investors toparticipate in the unfolding Reliance story and put their hard-earned money in the RelianceTextile IPO, promising them, in exchange for their trust, substantial return on theirinvestments. It was to be the start of one of great stories of mutual respect and reciprocal gainin the Indian markets.

Under Dhirubhai’s extraordinary vision and leadership, Reliance scripted one of the greatestgrowth stories in corporate history anywhere in the world, and went on to become India’slargest private sector enterprise.

Through out this amazing journey, Dhirubhai always kept the interests of the ordinaryshareholder uppermost in mind, in the process making millionaires out of many of the initialinvestors in the Reliance stock, and creating one of the world’s largest shareholder families.

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The Reliance Group is among India’s top three private sector business houses on all majorfinancial parameters, with assets in excess of Rs.180,000 crore, and net worth to the tune ofRs.89,000 crore.

Across different companies, the group has a customer base of over 100 million, the largest inIndia, and a shareholder base of over 12 million, among the largest in the world.

Through its products and services, the Reliance Group touches the life of 1 in 10 Indiansevery single day. It has a business presence that extends to over 20000 towns and 4.5 lakhsvillages in India, and 5 continents across the world.

The interests of the Group range from communications (Reliance Communications) andfinancial services (Reliance Capital Ltd), to generation, transmission and distribution ofpower (Reliance Energy), infrastructure and entertainment.

Reliance Life Insurance

Reliance Life Insurance offer customers products that fulfill their savings and protectionneeds. Reliance’s aim is to emerge as a transnational Life Insurer of global scale andstandard.

Reliance Life Insurance is a Reliance Capital Company and is part of Reliance Group.Reliance Capital is one of India’s leading private sector financial services companies, andranks among the top 3 private sector financial services and banking companies, in terms ofnet worth. Reliance Capital has interests in asset management and mutual funds, stockbroking, life and general insurance, proprietary investments, private equity and otheractivities in financial services.

Nippon Life Insurance Company acquired 26% interest in equity share capital of theCompany effective October 7, 2011 subsequent to receipt of all regulatory approval.

Nippon Life Insurance, also called Nissay, is Japan's largest private life insurer with revenuesof Rs 346,834 crore (US$ 80 Billion) and profits of over Rs 12,199 crore (US$ 3 billion). TheCompany has over 14 million policies in Japan, offers a wide range of products, includingindividual and group life and annuity policies through various distribution channels andmainly uses face-to-face sales channel for its traditional insurance products. The companyprimarily operated in Japan , North America, Europe and Asia and is headquartered in Osaka,Japan. It is ranked 81st in Global Fortune 500 firms in 2011.

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PRODUCTS OF RELIANCE LIFE

Whole Life Plans

Term plans

Unit Linked Insurance Plans

Endowment Plans

Children Plan

Money Back Plans

Pension Plans

Health & Accident Related Riders

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Vision & Mission

Vision

Empowering everyone live their dreams.

Mission

Create unmatched value for everyone through dependable, effective, transparent andprofitable life insurance and pension plans.

Our Goal

Reliance Life Insurance would strive hard to achieve the 3 goals mentioned below:

Emerge as transnational Life Insurer of global scale and standard

Create best value for Customers, Shareholders and all Stake holders

Achieve impeccable reputation and credentials through best business practices

Achievements

Largest Private Life Insurance in terms of Number of Policies for two consecutiveyears as of 31st March 2012

A wide network of 1230 branches and 1,50,000 advisors

Over 9 million policies

RLIC continues to be amongst the foremost Life Insurance companies in India to becertified ISO 9008:2001

Winner of “Best Non-Urban Coverage” Award at Indian Insurance Awards 2011

RLIC’s Boundaries for Books Campaign won the 'Silver' at the Indian Digital MediaAwards (IDMA) 2012, under Best Integrated Campaign – Social Cause and Best Useof Social Network – Social Cause

Amongst the top 3 Most Trusted Service Brands in the Insurance category as per theBrand Equity‘s ‘Most Trusted Service Brands 2011’ Survey

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2.1 OBJECTIVE OF THE PROJECT

To study the existing channel development process of RELIANCE LIFE.

Customer & potential agent’s perceptions about insurance as a product category.

To study the existing compensation for agents of RELIANCE LIFE.

To sell the RELIANCE LIFE products.

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2.2 LITERATURE REVIEW

Competition in Life Insurance Sector of India

Shilpa Thakur, Amity Law School

2009-10

The life insurance sector has a small market and cover approx. 3 % of population in India. Asa growing sector, it is important that all players get a level playing field. The competition actis to provide for a level playing field to all players to encourage competition in market.Through my study I have tried to substantiate this with facts and evidence proving that LIC asa state owned enterprise enjoys a dominant market. The enterprise having a dominantposition is not per se illegal but abuse is. The dominance of LIC is not deliberate rather it isby virtue of the regulations that the market is deprived of a level playing field and market hasan anti-competitive environment. This sector is highly lucrative and therefore increasing theFDI cap would be a step to enhance competition in this sector and also cover a largepopulation. Exclusive networking, sovereign guarantee and entry barriers like limited FDIcreates an anti-competitive environment in market.

Sales Force Turnover: An Exploratory Study of the Indian InsuranceSector

Suman pathak ,iilm Academy of Higher Learning, India

Vibhuti tripathi ,Motilal Nehru National Institute of Technology, India

The insurance sector in India is rising rapidly to bring in growth and employmentopportunities. Insurance companies are basically human intensive, and human resources actas an undoubted differentiator. Quality manpower and its retention would act as a litmus test.Turnover of sales force has been high because of low entry and exit barriers. The paperaddresses issues of recruitment, retention and turnover of sales force in insurance companies.An attempt is made to integrate them to Maslow’s Need Hierarchy. A survey was conductedamong 350 employees who worked in or had left insurance companies to analyze factors thatinfluenced their decisions and job satisfaction. The data were treated with factor analysis.Factors such as Safety & Security, Social & Esteem and Personal Work Style emerged as theinfluencers to join insurance companies. Primary Needs and Social & Self Esteem Needswere the factors associated with job satisfaction; Stress, Career Advancement and WorkEnvironment emerged as factors for leaving the companies.

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Contemporary issues in marketing of life insurance services in india

Mr. Manvendra pratap singh*; ms. arpita chakraborty**;

*assistant professor, department of management studies,

Galgotias college of engineering and technology,

Insurance and economic development in India exhibits a direct positive correlation on thegrowth path. Insurance companies, both life and non–life, have been playing the role offinancial intermediaries and performing extremely useful functions in our economy. In India,insurance sector was opened for private participation with the enactment of the IDRA Act,1999. Since then, 22 private companies have been established in life insurance sector. Allthese players are actively introducing innovative products to meet the specific needs of theprospective policy holders. However, life insurance companies, particularly private sectorplayers, give more attention in selling unit linked plans that are not suited to the real needs ofthe insured. Of the various alternative distribution channels, agency is still dominating andthe successful one. Given poor level of consumer awareness, strong customer educationprograms and promotional strategies are the immediate requirements. Exploring moredistribution channels of micro insurance for untapped rural market is extremely important.Further more customer service is the key for the success and life insurance companiestherefore should give more attention in post sales services rather than pre–sales services.Overall, our paper shows the important aspects of life insurance marketing activity from aservices perspective and highlights the contemporary issues and challenges facing the lifeinsurance companies in product marketing.

Life Insurance Industry in India - Current Scenario

Dr. Sonika Chaudhary, Priti Kiran

RGI, Mohali, Punjab, India

September -2011

When life insurance companies started operating in the middle of 20th century in the country,the evil play natural to all business had its sway. There was a lot of cut throat competition aswell as profiteering. As a result Life Insurance Corporation of India (LIC) came intoexistence on 1st September, 1956 after nationalization of all the 245 companies engaged inlife insurance business. However, Government made a paradigm shift in the economic policyby adopting the process of liberalization, privatization and globalization at the end ofprevious decade. Consequently, Insurance Regulatory and Development Authority (IRDA)has been established under IRDA Act, 1999 to regulate the insurance business in the country.As a result, private sector has been allowed entry both in general and life insurance sector inIndia. Life insurance industry expanded tremendously from 2000 onwards in terms of numberof offices, number of agents, new business policies, premium income etc. Further, many new

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products (like ULIPs, pension plans etc.) and riders were provided by the life insurers to suitthe requirements of various customers.

BANCASSURANCE – NEW OPTIONS FOR THE DEVELOPMENT OFSERBIAN FINANCIAL SECTOR

Borko Krstić, Faculty of Economics, University of Niš, Serbia

Nevenka Vojvodić-Miljković , Razvojna Banka Vojvodine a.d, Novi Sad, Serbia

Dejan Mandić , Delta Generali Osiguranje, Belgrade, Serbia

In difficult conditions of the global economic crisis, the insurance market manages to growfaster than the long-term global gross domestic product (GDP). Traditional barriers betweenbanking and insurance are being increasingly lowered in the last few decades. This is a resultof deregulation and liberalization of the financial services market, as well as a consequenceof the appearance of giant financial companies capable of rendering a wide range of financialservices. Banking distribution of insurance products is growing faster than traditional saleschannels both in the developed and in developing countries, first in life and recently in non-life insurance classes. Bank life insurance is strongly developed in some European countriesand has reached high market shares, such as in France and Portugal. Bancassurance is alsobecoming a major component of the distribution system primarily of life insurance indeveloping countries, especially in Central and Eastern Europe, stimulated by the expansionof mortgage and consumer loans. In the past few years, bancassurance has been developing inSerbia, where it maintains an upward trend as a sales channel. In the near future, especiallywith the opening of new bank credit lines and the introduction of tax incentives by the state,this sales channel may bring significant benefits both to banks and insurance companies, aswell as to clients in the form of offering all-in-one financial services aimed at saving time,lowering commissions and allowing premium.

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2.3 PURPOSE OF THE PROJECT

RELIANCE LIFE INSURANCE has the maximum job availability. They followsome process regarding the recruiting people. The need of the project during the course ofmy summer internship for Reliance life was to get an insight into the training modules andsessions given to their employees of the RELIANCE LIFE. Thus there was a need to designand build a competent training module thereby enhancing the competency levels andinterpersonal skills of the employees of the company, so as to prepare them for providingbetter service to their customer.

SCOPE OF THE STUDY

A big boom has been witnessed in Insurance Industry in recent times. A large numberof new players have entered the market and are trying to gain market share in this rapidlyimproving market. In recent time also Reliance life has the highest employment. It is the 3rd

highest insurance company in India. In insurance sector a person can earn huge amount ofmoney.

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2.4 RESEARCH METHODOLOGY

Research Design:

Exploratory research

The research is primarily exploratory in nature. The sources of information are both primary& secondary. A well-structured questionnaire was prepared and interviews were conducted tocollect the customer’s perception behavior and selling insurance through this questionnaire.

Sampling Technique:

Initially a rough draft was prepared keeping in mind the objective of the research. A pilotstudy was done in order to know the accuracy of the questionnaire. The final questionnairewas arrived only after certain important changes were done. Thus our sampling came out tobe judgmental and convenient.

Sampling unit :

The respondents who were asked to fill out questionnaire are the sampling units was 75.These comprise of Salaried employees, students, business Employees, and Self Employedetc.

Sampling Area:

The area of the research was Agra region which comprises two branches of Reliance LifeInsurance are Agra-1 & Agra-2. Research undertaken in Agra-1.

Sample size:

The sample size was restricted to only 50, which comprised of mainly peoples from Agra..It represents the whole unknown population.

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DATA COLLECTION:-

(a) Primary Quantitative Data

Primary data collected specially from the field for the purpose of providinginformation on the decision under questionnaire.

(b) Secondary Quantitative data

These are the existing data. Secondary data collected from internal source and alsofrom the external source. Internal source from company’s record, which is alreadyconducted found within the company and also from company’s website. Externalsource from client, advertising etc.

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CHAPTER 3: PROJECT FINDINGS & ANALYSIS

3.1 SWOT Analysis

3.2 Conclusion

3.3 Limitations

3.4 Recommendation

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1. Annual Income/Salary of respondents who are interested to buy insurance?

INTERPRETATION

53% respondents are interested to buy insurance who had annual income below 1oooo. Theyinvest their money for saving purpose

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INTERPRETATION


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INTERPRETATION


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2.Do you have a Life Insurance?

INTERPRETATION

Only 53% respondents having life insurance from the population & rest 47% are thoserespondents which don’t have life insurance.

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INTERPRETATION


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INTERPRETATION


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3.Which type of Life Insurance you are having or interested in having?

INTERPRETATION

58% respondents are having insurance for the saving purpose. 42% respondents are takinginsurance for investment purpose. 4% respondents having insurance for pension afterretirement, they invested their money for longer time.

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INTERPRETATION


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INTERPRETATION


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4.From which of the company you having a Life Insurance?

INTERPRETATION

Most of the people want to invest his money in public insurance company. Most of the peoplebuy insurance from LIC i.e 58% and 6 % respondents are interested in Reliance Life. Thereare 24 private insurance companies in India.

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INTERPRETATION


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INTERPRETATION


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INTERPRETATION

In insurance plan respondent want mostly Endowment plan. 43% respondents useEndowment plan and 23% respondent want to buy Term Plan. 23% were interested inretirement plan, 10 % were interested in investing ULIP. None of them were interested inChild plan.

Endowment Plan is the plan in which consumer get both benefits (Maturity & Death). In ULIP plan, money is invested in the market and the value of fund depend on the

market scenario. Retirement Plan is for getting pension after retirement. Child Plan is taken by the parents to meet their children’s future requirement. Term Plan is the plan where the insured person gets only death benefit.

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INTERPRETATION




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INTERPRETATION




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6.What is the main motive behind taking insurance?

INTERPRETATION

Most of the people buy insurance policy for his old days saving because they want to savemoney for old age i.e. 33% and also 33% people buy insurance for risk cover for the benefitfor their families.

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INTERPRETATION


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INTERPRETATION


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7.How do/will you decide about investing in life insurance?

INTERPRETATION

Insurance is now basic investment for consumers. But this is tradition of India that we are notbelieve in unknown people So when any one buy insurance policy then his or her decision isdepend on family friends etc.here if we see 60% respondents believe his /her own decision to buy insurance policy butonly 33% respondent’s decision depend on family.

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INTERPRETATION


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INTERPRETATION


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8. If you are getting a job in Reliance life insurance sector, would you like to accept?

INTERPRETATION

60% respondents are accepting the job in insurance if they get a chance & 40% respondentsare not accepting the job whether they get chance ..

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INTERPRETATION


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INTERPRETATION


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9. From where you heard about Reliance life insurance?

INTERPRETATION

More than half of respondents are aware about Reliance life insurance through T.V i.e. 53%.Respondents are knew about Reliance life from other sources also like hoardings, pamphletsetc. i.e. 27%.

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INTERPRETATION


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INTERPRETATION


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10. Are u interested to join other than Reliance life insurance company ?

INTERPRETATION:

Only 30% respondents are interested to join other insurance company & 70% respondents areinterested to join Reliance life insurance after they aware about the facts n figures.

NOT INTERESTED70%

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INTERPRETATION:


INTERESTED30%

NOT INTERESTED70%

33


INTERPRETATION:


34

11. Availability of present job market

INTERPRETATION

Availability of job in insurance sector is moderately i.e. 80%. Respondents have to clear theIRDA exam & they have to score minimum 50% marks in that exam.

Moderatelyavailable

80%

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INTERPRETATION


Easily available11% Not available

9%

Moderatelyavailable

80%

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INTERPRETATION


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3.1 SWOT ANALYSIS

SWOT analysis is the analysis of the internal and external factors, whichhave impact on the survival of any organization. Now let’s make SWOTanalysis for reliance Life Insurance Company Limited.

STRENGTHS:

1) Reliance Life Insurance Company Limited is the part of the Reliance Capital.

2) The brand name is enough to sell the products easily.

3) Private placement of Rs. 10,000 crs worth of securities with RBI by the government. Ledto an improvement in market securities.

4) Strong liquidity from FII was the major reason for the up move.

5) Range of products

6) Reliance has a long and strong history of solvency, financial stability.

WEAKNESSES:

1)Newly established company, so people seems it risky.

2) Lack of staff.

3) Lack of advertisement, so most of the customers are not awareof the Reliance Life Insurance.

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OPPORTUNITY:

1) There is a vast untapped market in India. The life insurance penetration in India isapproximately 2.5%. So it has large potential.

2) Intention of traditional products is to encourage long term, regular and disciplinedsavings to systematically build up a target fund.

3) The average insurance premium being collected by the company has been growingexponentially year on year.

THREATS:

1) The main threat is from the other players who have grabbed approximately 15% of themarket share.

2) As the government has scrapped the rebate on the life insurance premium, the peoplewho used to invest in life insurance for the saving purpose.

3) Sole motive of tax benefit may turn to other instruments.

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3.2 FINDINGS

55% of the respondents are having insurance plan for the saving purpose & 42% aretaking life insurance for the purpose of investment.

Maximum number of respondents prefers insurance plans of LIC. Only 6% ofrespondents prefer Reliance Life insurance Plans.

Maximum respondents are having Endowment Plans.

60% of the respondents are ready to with Reliance Life Insurance sector.

TV is the main source of media from where the respondents get to know aboutReliance Life Insurance.

Only 30% employees want to join other companies than Reliance Life Insurance. Thecommission paid by Reliance Life Insurance is more as compared to other companies.

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3.3 CONCLUSION

After the deep study of insurance sector of India, I can tell that this is the sector,which has most business opportunities perhaps in India.

Insurance industry is one of the fastest sectors in India. Insurancesector has been growing by 32% to 34% and it is expected to increase by 50% incoming 5 years. After the opening up of the insurance sector, it has become muchcompetitive and insurance awareness among people has increased.

As far as the comparison of Reliance Life Insurance and other players is concerned,there are both positive as well as negative impacts on both the sides.

For private players the negative aspect is that they have to fight with the public sectorgiant which is established player with a high brand value.

Endowment plan is prefer by the sample size because there is no risk in this plan, andbenefit is also good.

Peoples mainly took insurance for their saving purpose.

But the positive impact is that the life insurance awareness has increased and thebusiness of Reliance Life Insurance has increased.

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3.4 RECOMMENDATION

Reliance Life as an insurance firm has a very strong presence in India and is rapidly

expanding its operations in India. After working on this project I feel that following are some

of the ways in which the company can improve the current market base and selection

procedure for Agent Advisors, the key revenue generating resource for the company:

Low awareness Reliance life insurance brand in the mind of potential Agent Advisor.

Reliance Life insurance compensation package is considered to be quite good as permarket standard. However the 30 days full time training programme is causingapprehension in minds of potential agents. A part time training alternative can also beconsidered.

Reliance Life can provide some database collected from other sources to the newrecruits at least in the first month.

The registration fee for IRDA training programme is refundable. In other companieshaving higher charges.

It gives good commission on policy as compare to other insurance companies.

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3.5 LIMITATION OF STUDY

Due to large area we had to restrict in the particular areas of Agra.

We couldn’t take interview of agents & advisors of the company.

Many people were not interested to fill up the questionnaire.

Regarding the making of questionnaire we were bound to make that on the basis ofthe company’s selection criteria only. So we were not able to get more information.

Many people were not interested to invest their money in insurance.

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BIBLIOGRAPHY

Books

D.C.Srivastava & Shashank Srivastava Year-2001

Indian Insurance Industry - Transition and Prospects

Kaninika Mishra Year-2010

Fundamental of LIFE INSURANCE - Theories and Applications

Dr. Rakesh Agarwal (Ed.) Year-2011

Guide to Principles of Insurance (Key for Licentiate Examination)

Prof. R.Haridas Year-2011Life Insurance in India

Websites

http://www.reliancecapital.co.in/about_chistory.html

http://www.reliancepower.co.in/about_us/company_profile.htm

http://www.rbe.co.in/about-us.html

http://www.reliancehealth.co.in/rhportal/web/about_company.html

http://www.reliancelife.com/rlic/AboutUs/about_reliance_life_insurance.aspx 15/07/12

http://www.reliancelife.com/rlic/AboutUs/acheivements.aspx

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APPENDIX

Questionnaire for Channel development in Insurance & Sales

1. Name:

2. Age:


a. Below 100000 [ ] b. 100000-200000 [ ] c. 200000-500000 [ ]

d. Above 500000 [ ]

4. Do you have a Life Insurance?

a. Yes [ ] b. No [ ]

5. Which type of Life Insurance you are having or interested in having?

a. Saving [ ] b. Investment [ ] c. Pension [ ]

6. From which of the company you having a Life Insurance?

a. LIC [ ] b. ICICI Prudential [ ] c. SBI life [ ] d. Reliance [ ]

e. other [ ]

7. Sir/Madam, Which type of Life Insurance you are having or interested in having?

a. Endowment Plan [ ] b. ULIP Plan [ ] c. Retirement Plan [ ]

d. Child Plan [ ] e. Term Plan [ ]

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APPENDIX


1. Name:

2. Age:


a. Below 100000 [ ] b. 100000-200000 [ ] c. 200000-500000 [ ]

d. Above 500000 [ ]


a. Yes [ ] b. No [ ]





e. other [ ]




42

APPENDIX


1. Name:

2. Age:


a. Below 100000 [ ] b. 100000-200000 [ ] c. 200000-500000 [ ]

d. Above 500000 [ ]


a. Yes [ ] b. No [ ]





e. other [ ]




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8. What is the main motive behind taking insurance?a. Risk Cover [ ] b. Tax Benefit [ ] c. Saving [ ]

d. Return Yield [ ]

9. How do/will you decide about investing in life insurance?

a. On my own [ ] b. Family Decision [ ] c. Employer Decides [ ]

d. As per the guidance of agent

10. If You have taken the insurance from any company other than Reliance,Then would like to switch to Reliance if given better benefits?

a. Yes [ ] b. No [ ]


a. T.V [ ] b. Internet [ ] c. Newspaper [ ] d. Public [ ]

12. Are you interested to join other than Reliance life insurance company.Yes [ ] No [ ]


a. Moderately [ ] b. easily [ ] c. Not available [ ]

Project Report

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