Documente Academic
Documente Profesional
Documente Cultură
1
Project On
________________________________
________________________________
________________________________
Master of Business Administration (Marketing)
Submitted by
________Sunil Kumar____________
Roll no-09-Ait-Mba-131
PRN No.
of
Ansal Institute of Technology
Gurgaon
Guided By Prof._____________________
2
PREFACE
CERTIFICATE
3
4
TABLE OF CONTENTS
ACKNOWLEDGEMENTS
PREFACE
PART-1
CHAPTERS
1. INTRODUCTION
A. INTRODUCTION TO LIFE INSURANCE…………………………………………………5
B. INSURANCE IN INDIA……………………………………………………………………..9
C. PRE AND POST LIBERALISED INSURANCE IN INDIA………………………………22
D. BENEFITS OF LIFE INSURANCE………………………………………………………..26
E. RESISTANCE TO LIFE INSURANCE……………………………………………………30
2. IRDA – REGULATIONS & CONTROL AND TRAINING…………………………………31
3. BAJAJ ALLIANZ – AN OVERVIEW
A. COMPANY PROFILE……………………………………………………………………..39
B. PRODUCTS OF BAJAJ……………………………………………………………………41
C. ORGANISATIONAL STRUCTURE………………………………………………………
PART-2
4. RESEARETHODLOGY……………………………………………………………………….53
5. COMPARATIVE STUDY
A. TYPES OF LIFE INSURANCE POLICIES………………………………………………..70
B. COMPARATIVE ANALYSIS OF THE PRODUCTS……………………………………..74
6. ANALYSIS OF THE SURVEY
A. QUESTIONNAIRE DESIGNIING…………………………………………………………88
B. DIAGRAMMATIC REPRESENTATION OF THE DATA……………………………….93
7. CONCLUSION………………………………………………………………………………...103
8. SUGGESTIONS……………………………………………………………………………….105
9. BIBLIOGRAPHY…………………………………………………………………………..…107
10. ANNEXURE………………………………………………………………………………….109
5
Introduction
People in all walks of life are exposed to risk and uncertainty. An untimely death,
loss of goods due to theft and natural calamities like floods, earthquake are some
examples of the risk that everybody on earth faces. As days progress, man is
becoming exposed to more and more dangers both natural and man-made. Insurance
is the universal panacea that offers to provide against such risk and uncertainty.
Insurance does not profess to eliminate loss but it compensates, to some extent, the
loss, which arises from uncertain events.
6
Every member who wants to have the benefit of insurance enters into a contract with
the insurer. The evidence of contract is the policy document, which specifies the
obligation of each party. The members who obtain life insurance protection on
agreeing to ‘pay premiums’ are referred to as the policy holders. The insurer makes
administrative and financial arrangements for giving effect to the contract. Such
contracts entered into between the policy holders and the insurers are governed by the
prevailing laws.
7
History of insurance
The insurance sector in India dates back to 1818, when Oriental Life Insurance
Company was incorporated at Calcutta. Thereafter, few other companies like
Bombay Life Assurance Company, in 1823 and Tritron Insurance Company, for
General Insurance, in 1850 were incorporated. Insurance Act was passed in 1928 but
it was subsequently reviewed and comprehensive legislation was enacted in 1938.
The nationalisation of life insurance business took place in 1956 when 245 Indian
and Foreign Insurance provident societies were first merged and then nationalised. It
paved the way towards the establishment of Life Insurance Corporation (LIC) and
since then it enjoyed a monopoly over the life insurance business in India. General
Insurance followed suit and in 1968, the insurance act was amended to allow for
social control over the general insurance business. Subsequently in 1973, non-life
insurance business was nationalized and the General Insurance Business
(Nationalization) Act, 1972 was promulgated. The General Insurance Corporation
(GIC) in its present form was incorporated in 1972 and maintained a very strong hold
over the non-life insurance business in India. Due to concerns of
(b) The efficient and quality functioning of the Public Sector insurance companies.
(c) The untapped potential for mobilizing long-term contractual savings funds for
infrastructure.
8
be referred back to a select committee of parliament. But now the parliament has
given a nod to the Insurance Regulatory and Development Authority (IRDA) bill
with some changes in the original structure.
9
Liberalization
The decision to allow private companies to sell insurance products in India rests with
Indian Parliament. Opening up the insurance sector required crossing at least two
legislative hurdles. These were the passage of the insurance Regulatory authority
(IRA) bill, which would make IRA a statutory regulatory body and the amendment of
the LIC and GIC Acts, which would end their respective monopolies.
The Act provides for the establishment of a statutory IRDA to protect the interest of
insurance policy holders and to regulate, promote and ensure orderly growth of
insurance industry. The IRDA was formed by an act of the Parliament on April 19,
2000. The IRDA Act also seeks to amend the Life Insurance Act, 1956, the General
Insurance Business (Nationalisation) Act, 1972, and the consequential provisions of
the Insurance Act, 1938 with a view to seizing the exclusive privilege of LIC and
GIC in the life and non-life businesses respectively.
Under the IRDA Act, an “Indian insurance company” will be allowed to conduct
insurance business provided it satisfies the following conditions:
It must be formed and registered under the Companies Act, 1956; the aggregate
holdings of equity shares by a foreign company, either by itself or through its
subsidiary companies, should not exceed 26% paid up equity share capital of an
insurance company.
10
Its sole purpose must be to carry on life insurance business or general insurance
business or reinsurance business.
It has also been provided in the IRDA Act that on or after the commencement of the
act no insurer will be allowed to carry on life insurance and general insurance
business in India unless it has a paid up equity capital of rupees 1 billion. For
carrying on the reinsurance business, the minimum paid up equity capital has been
prescribed as Rs. 2 billion. The Reserve Bank of India (RBI) has also issued
guidelines for banks entry into the insurance business.
Following the passage of the IRDA Act, by March 2001, thirteen new life insurers
have received licence from IRDA. Although Private insurance companies have
commenced operations, the nationalised insurance companies are expected to
dominate the market in the near future.
The limiting factor for prospective private insurers will be the extensive and costly
distribution structure required. The new entrants can not expect to duplicate the
extensive distribution network of the nationalised insurance companies. Building a
distribution network is expensive and time consuming.
Medical Insurance
In anticipation of unexpected events that create the need for medical goods and
services, Indian consumers may purchase medical insurance for the following types
of coverage: Heart attacks, strokes, diseases, prolonged illnesses, and loss of limb,
11
eye, or other parts of the body due to accident. They may also purchase mediclaim
policies that cover medicines, operations, scanning, X-rays, hospital charges, etc.
Demographics
Country Profile
Population
(1980-92) 2.0%
[1995-2111] 1.8% estimated
Estimated 2011-12 1,179 million
(1980-92) 2.0%
[1995-2111] 1.8% estimated
Production (USD)
Economic Indicators
12
Foreign direct investment USD 3.7 billion (1997)
USD 4.0 billion (1998)
Estimated growth 7.81% (over the previous year)
External debt USD 92 billion 12/1998 Total)
USD 11 billion (short-term)
Budget deficit USD 81 billion (1997)
Industrial production growth 3.8% (1997-98)
Indian Scenario in Light of the Insurance Sector
Premiums
In 1996, the volume of worldwide life insurance premiums amounted to USD 2.1
trillion with almost 57 percent accounted for by life insurance and the remainder
accounted for by non-life. Industrialized nations accounted for the vast majority
(around 90 percent) of the premiums. The largest life insurance markets were the
U.S. (31 percent and USD 653 billion) and Japan (24.7 percent and USD 520 billion).
India, with annual gross life insurance premiums of USD 3 billion accounted for less
than 0.2 percent of global premiums.
13
Growth
Although India averaged 20 percent annual insurance premium growth in the past,
growth has declined to approximately 15 percent recently.
Insurance Penetration
Compared to developed and industrialized countries, India is at the lower end of the
spectrum when it comes to penetration of the market. Among countries in the lower
per capita income band of less than USD 2,000 per annum, India is second only to
Zimbabwe.
14
Density
Switzerland is the world’s largest per capita insurance spender (USD 4,663 per
inhabitant), ahead of Japan (USD 4,132 per inhabitant) and far ahead (200 percent
more) of North America, and even further ahead (250 percent more) of Western
Europe. India is ranked near the bottom of the list of countries on insurance spending
with USD 6 per inhabitant.
Population Demographics
India has a young demographic profile; nearly two thirds of the population is under
30. Yet, about 10 percent of the population is over 60. This proportion is expected to
rise sharply. By 2030, the Indian population is expected to stabilize at about 1.1
billion, about 20 percent of which will be over 60. Therefore, a key problem will be
providing support for over 220 million senior citizens—many of whom will be quite
fit and likely to enjoy two decades or more of old age (Source: World Development
Indicators, 1997).
15
[1] Estimators further predict a sharp drop in this category by the year 2016.
[2] Rough estimates point toward this static reaching 75 years and higher over the
next few decades.
[3] Better medical and health facilities may produce a further drop in this statistic,
with the rate reaching half of 1971 in the near-term.
Age Group
Population Population
(Millions) Percent (Millions) Percent
[Years] 1991 1981
0-4 110.9 13.1 83.8 12.6
5 – 14 196.3 23.2 179.3 26.9
The above figures show the changing trends with population in the age group 5-14
dropping as birth rates decline and population in the 20-44 brackets increasing.
Unfortunately, at present only about 6 percent of Indian residents above 20 years of
age are covered by some form of pension scheme. (Employee Provident Fund
Organization data.) More Demographic Trends in traditional societies such as India,
the joint family system provided an insurance umbrella for surviving family
members. In modern times, such arrangements are made increasingly through the
market mechanism by buying insurance. Thus, individuals pay a price (a (premium()
16
to insurance companies for such a contractual arrangement, and insurance companies,
in turn, provide compensation if a specified event occurs. By making such contractual
arrangements with a large number of individuals and organizations, insurance
companies can spread risk. This gives insurance a (social ( characteristic, in the sense
that it entails the pooling of individuals risks, such as longevity (i.e. the risk of
outliving other sources of income) and disease and sickness (health insurance). Two
relatively modern trends in the India context affect the life insurance business
significantly. First, with nuclear families becoming the rule, there is a greater demand
for life insurance to cover the breadwinner of the family.
Second, there are greater numbers of the elderly (due to increased life expectancy)
and the elderly are increasingly having to fend for themselves.
Thus, future senior citizens look to plan for their old age, rather than be a burden to
their children. There is a greater awareness of planning for old age and the need for
pensions and annuities. These two trends portend a large and growing market for life
insurance in India. In fact the growth rates of premiums in developed countries are
barely 5 percent, while they are nearly 20 percent in many developing countries. One
factor that is facilitating this development is the increase in the size of India’s (middle
class. (With an estimated size of 250 million, it is at least four times as large as the
current coverage of LIC. Other developments effecting this trend include a healthy
growth rate of the economy (greater savings), proliferation of saving instruments, a
trend toward economic liberalization, greater consumer awareness, and greater
awareness about insurance. Indian’s increased use of insurance can also help solve
another major problem in the country: Inadequate infrastructure. The 1997 Rakesh
Mohan Report documents the need for reliable capital markets to finance
infrastructure projects. Infrastructure projects are almost always long-term. Funds of
long tenure are best raised from contractual savings such as pension funds, provident
funds and life insurance. At present, the total annual accrual to all such funds is about
USD 2.4 billion. The Rakesh Mohan report estimates a current requirement of USD
2,823 billion for infrastructure over the next ten years.
17
The bulk of this must be raised domestically, requiring a huge expansion of the life
insurance and pension fund industry. It is evident that two problems—future old age
security and present and future infrastructure needs – can be solved simultaneously.
The Demand for Pension Plans Pension reform in India was initiated when the Union
Finance Minister announced in his 1997 Budget speech that the monopoly in the
issuance of annuities that was enjoyed by the Life Insurance Corporation (LIC)
would end. He indicated that the Unit Trust of India (UTI) would enter pension fund
management and that the LIC and UTI would be free to enter into joint ventures
pension fund management. Also, he was quoted widely as having approved the
(Chilean Experiments). In much of the developed world, pension funds represent an
important form of financial assets in the economy. In India however, with the
exception of employees in the organized sector, few workers have social security
coverage.
Currently there are three forms of old age security: Provident funds, gratuities, and
pensions. The Employee’s Provident Fund Scheme (EPFS), which began in 1952, is
the largest of all provident fund programs. It covers almost 20 million employees in
the organized sector and has over USD 13.2 billion in assets. The fund, which is
administered by a Central Board of Trustees (CBT), is restricted severely in its
choices of investment options. Other provident fund programs include the Coal
Mines Provident Fund Scheme, the Central Government Employee’s Group
Insurance Scheme, and the Public Provident Fund Scheme. Under the gratuity
program, gratuities are distributed upon retirement, death or resignation, and benefits
are in accordance with the Payment of Gratuity Act, 1972. The cost of a gratuity is
entirely borne by the employer and is paid on a cash basis or funded by the employer
during the service period of an employee.
The fund is administered by a trust or contributions are paid to the LIC under its
Group Gratuity Scheme. The third form of social security is pensions. The LIC
provides pension programs, but the premiums received from such programs form
only a very small portion of its total premium income. Institutions that provide
18
pensions to their employees either set up an internal fund and purchase a life annuity
from the LIC (only) when an employee retires, or they purchase a group pension
policy from the LIC. This monopoly of the LIC in providing annuities for employers
with private pension arrangements was relaxed in 1997 when Unit Trust of India
(UTI) was also allowed to sell annuities. The lack of growth of Indian pension plans
is due to inadequate tax relief for pension funds combined with restrictions on
pension fund investments that yield low returns. Furthermore the virtual monopoly of
LIC, which reflects a lack of innovation and marketing in the pension plan field, has
ensured that pensions remain a very under developed sector in India.
19
Indian Pension Fund Total Assets
(In billions of U.S. dollars)
20
countries like the U.S. and U.K. Another tax anomaly that needs to be corrected is the
asymmetric treatment of LIC versus employer funded pensions.
Although India started a social security program of sorts almost seventy years ago,
achievements have lagged behind intentions and coverage is still limited. Recent
experiences in manufacturing and services show the advantages of competition to
customers and to Indians at large : Better service, a larger and a better choice of
products, and market deepening and widening. South America’s recent experience
confirms that competition could work wonders wonders for worker’s security in
India, while providing funds for infrastructure and financial market development.
Changes in the Insurance Sector in the Pre & Post Liberalization Scenario
21
* Approach of Agent – Informal and * Approach – more professional, sometimes
through referral aggressive
* Long term family type of * Proactive in contacting prospects directly,
relationship often has to start from selling concept of
* Often selling insurance as insurance rather than product
commodity * Conducts financial health check up and
* Average communication skills then offers suitable products/solutions
* Better communicator & presenter
* Handles larger number of queries
PURCHASE PROCESS
Rate of discount : 25% - 50% Rate of discount : More or less the same
of first year premium
Policy Delivery
Mode Mode
- Registered post for LIC, hand - Registered post for LIC
delivered by agent in 23% - Courier for Private companies
cases In both cases, policy comes in attractive,
Time taken protective plastic jacket
- Up to 1 week Time taken LIC Pvt Co.
0% Up to 1 week 5%
22
- One month 85%
65% Up to 1 month 77%
- > One month 15%
35% > 1 month 18%
0%
44% 37%
• Agent • Agent
49% 49%
• Salary saving scheme • Salary saving scheme
7% 14%
Correspondence (other than premium notice) from Company/Agent
• Generally no • Mailers from both private companies and
23
correspondence from either company LIC on products and services, greeting cards on
or agent except for late premium birthdays, anniversary and new year
payment reminder from company • Phone calls form private company call
• Agent maintained centers
informal contact with close • Agent in regular contact for offering new
customers products
Delay in Premium Payment
• Incidence of delay high • Incidence of delay low 15%
30% (More regular receipt of premium notice
(Due to irregular receipt of from company / reminder from agent)
premium notice from
company/reminder from agent)
24
BENEFITS OF INSURANCE
The various benefits from Insurance are as follows :-
1. Insurance would assist businesses to operate with loss volatility and risk
of failure and provide for greater financial and societal stability from the
growth pangs of an estimated growth rate over 8% in GDP.
2. Besides government provides for social security programs, there is
considerable impact upon the government. Insurance substantially steps in
to provide these services. The effect would be to reduce the strain on the
tax payer and assist in efficient allocation of social resources.
3. Facilities trade, business and commerce by flexible adaptation to changing
risk needs particularly of the burgeoning services sector.
4. Like any other financial institution, insurance companies generate savings
form insurance sector within the economy and make available the same in
well directed areas of economy deserving investment ; a sector with a
potential for business as in case with Indian insurance provides incentive
to develop it all the more faster.
5. It enables the risk to be managed more efficiently through risk pricing and
risk transfers and this is an area that provides unlimited opportunities in
the Indian context for consulting, broking and education in post.-
privatization phase with newer employment opportunities.
6. The insurance industry expertise in understanding losses assists it to share
the experience across the economy this enabling better loss control and
preservation of national assets.
In its risk pricing and investment decisions the insurance industry sets the
tone for investment by others in the economy. Informed assessment by
insurance companies thus signals allocation of resources by others
contributing to the efficiency in allocation. In India visibility of LIC and GIC
25
have been dwarfed by government’s actions and other high profile
institutions like ICICI, IDBI and UTI.
26
The UNCTAD study introduction then notes: “Because of the forgoing reasons,
the expansion and development of life insurance has been actively encouraged in
many countries.
MARKET SEGMENTATION
The organization must decide about the homogeneous group which will constitute
the market for the said product. The process of deciding about the particular part
of the total market which is primary target for a given product is called the process
of market segmentation. Most of the organizations normally market a number of
products and, therefore, have to decide about the market segments for each one of
their products. Moreover any one of such articles or products manufactured by the
organization may have different users in the eyes of the consumers and may, thus,
be marketed differently to different market segments. Market segmentation can
also be made on the basis of some important characteristics of consumer groups
such as their requirements, buying habits, etc. thus a market segment does not
denote a group of people having, say, common age or income or staying in a given
area but is deemed to be constituted of persons to whom a particular product
appeals for the fulfillment of a similar need and who are amenable to similar
communication or promotional appeals.
Market segmentation for consumer goods and services can be made on the basis
of either consumer goods or services can be made on the basis of either consumer
characteristics or consumer characteristics or consumer responses.
27
Multi attribute Grid to help identify the Target Market for life insurance
Higher
Middle
Low
Wage Agriculturists Traders Professionals
Earners
28
RESISTANCE TO INSURANCE
The concept of insurance being intangible and abstract and somewhat conflicting
with our ingrained patterns of traditions, cultural, benefits, the need is not readily
felt and understood, felt and accepted.
The sacrifice involved in payment of premiums is immediate and real whereas the
benefits are perceived as contingent and distant, leading to a tendency to
procrastinate and delay decision-making.
People resist in taking a life insurance policy, as the commitment is long term.
They prefer investing their money in other avenues like mutual fund, bonds,
shares etc., where they expect higher returns. People do not readily accept the fact
that they are prone to the risk of death.
It is important for the people to understand the importance of life insurance. Risk
coverage is the essential feature of an insurance policy, the investment aspect is
secondary. Now a days insurance companies are offering policies designed purely
for investment purpose, which also have an insurance element in them. Such
policies are attracting people for their investment needs, though the element of
risk coverage is not sufficient.
It is said that the life of every person must be insured up to the human life value
(HLV) of that person. Human life value means the value of his potential net
earnings estimated for the period for which he is going to earn less the amount of
money he spends on his self-maintenance. Therefore it becomes important for
every earning individual to insure himself up to the amount of his HLV. But not
many people understand the relevance of insurance, therefore they resist to buy a
life insurance policy.
29
30
INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY
(LICENCING OF INSURANCE AGENTS) REGULATIONS, 2000
Definitions.
2. In these regulations, unless the context otherwise requires, -
(a) “Act” means the Insurance Act, 1948
(b) “Approved Institution” means an institution engaged in education and/or
training particularly in the area of insurance sales, services and marketing,
approved and notified by the authority;
(c) “Authority” means the Insurance Regulatory and Development Authority
established under the provisions of section 3 of the Insurance Regulatory and
Development Authority Act, 1999
(d) “Composite Insurance Agent” means an insurance agent who holds a license to
act as an insurance agent for a life insurer and a general insurer;
(e) “Corporate Agent” means a person other than an individual as specified in
clause
(i)
31
(f) “Designated by an insurer, and authorized by the authority to issue or renew
licenses under these regulations;
(g) “Examination Body” means an institution, which conducts, pre-recruitment
tests for insurance agents and which is duly recognized by the Authority;
(h) “Licence” means a certificate of licence to act as an insurance agent issued
under these regulations ;
(i) “Person” means –
(i) an individual;
(ii) a firm
(iii) a Company formed under Companies Act 1956
(j) “Practical training” includes orientation, particularly in the area of insurance
sales, service and marketing, through training modules as approved by the
authority;
(k) “Proposal form” means an application for purchase of insurance product which
shall be the basis of insurance contract.
(l) “Prospect” means a potential purchaser of an insurance product;
(m) “Recognized board or institution” means such board or institution as may be
recognized by any State Government or the Central Government.
(2) All words and expressions used herein and not defined but defined in the
Insurance Act, 1938, or in the Insurance Regulatory and Development Authority
Act, 1999, shall have the meanings respectively assigned to them in those acts.
32
Issue and renewal of licence.
3. (1) A person desiring to obtain or renew a license (hereinafter referred to as
“the applicant”) to act as an insurance agent or a composite insurance agent shall
“proceed’ as follows:-
(a) the applicant shall made an application to a designated person –
(i) in Form IRDA-Agents-VA, if the applicant is an individual;
(ii) in Form IRDA-Agents-VC, if the applicant is a firm or a company;
Provided that the applicant, who desires to be a composite insurance agent, shall
make two separate applications.
(b) The fees payable by an applicant to the Authority shall be as specified in
Regulation
7.
(2) The designated person may, on receipt of the application along with evidence
of the application along with the evidence of payment of fees to the authority, and
on being satisfied that the applicant,-
(i) possesses the qualifications as specified under Regulation 4;
(ii) possesses the practical training as specified under Regulation 5;
(iii) has passed the examination as specified under Regulation 6;
(iv) has furnished the application complete in all respects;
(v) has the requisite knowledge to solicit and procure insurance business; and
(vi) is capable of providing the necessary service to the policy holder;
grant or renew, as the case may be, a licence in Form IRDA-Agents-VB, along
with identity card in Form IRDA-Agents-VZ:
Provided that in the case of a corporate agent, the identity card shall be in Form
IRDA-Agent-VY.
33
(3) If the designated person refuses to grant or renew a licence under this renew a
licence under this regulation, he shall give the reasons therefore to the applicant.
Practical Training
5. (1) The applicant shall have completed from an approved institution, at
least, one hundred hours’ practical training in life or general insurance
business, as the case may be, which may be spread over three to four
weeks, where such applicant is seeking licence for the first time to act
as an insurance agent.
Provided that the applicant shall have completed from an approved
institution, at least one hundred and fifty hours’ practical training in
life and general insurance business which may be spread over six to
eight weeks, where such applicant is seeking licence for the first time
to recognize as a composite insurance agent.
Examination.
6. The applicant shall have passed the pre-recruitment examination in life
or general insurance business, or both as the case may be, conducted
by the Insurance Institute of India, Mumbai or any other examination
body.
34
Fees payable.
7. (1) The fees payable to the Authority for issue or renewal of licence to
act as an insurance agent or a composite insurance agent shall be
rupees two hundred and fifty.
Code of Conduct
8. (1) Every person holding a licence, shall adhere to the code of conduct
specified below :-
(i) Every insurance agent shall -
(a) identify himself and the insurance company of whom he is an
insurance agent;
(b) disclose his licence to the prospect on demand;
(c) disseminate the requisite information in respect of insurance
products offered for sale by the insurer and take into account
the needs of the prospect while recommending a specific
insurance plan;
(d) disclose the scales of commission in respect of the insurance
product offered for sale, if asked by the prospect;
(e) indicate the premium to be charged by the insurer for
insurance
product offered for sale;
(f) explain the prospect the nature of information required in the
proposal form by the insurer;
(g) bring to notice of the insurer any adverse habits or income
inconsistency of the prospect;
(h) inform promptly the prospect about the acceptance or rejection
of the proposal by the insurer;
(i) obtain the requisite documents at the time of filling the
proposal form by the insurer;
35
(k) render necessary assistance to the policy holders or claimants
or beneficiaries in complying with the requirements for
settlement of claims;
(l) advise every policy holder to effect nomination and
assignment;
(ii) No insurance agent shall –
(a) solicit or procure insurance business without holding a valid
licence;
(b) induce the prospect to omit any material information in the proposal
form;
(c) induce the prospect to submit wrong information in the proposal
form or documents submitted to the insurer;
(d) behave in a discourteous manner with the prospect;
(e) interfere with any proposal introduced by any other insurance
agent;
(f) offer different rates, advantages, terms and conditions other than
those offered by his insurer;
(g) demand or receive a share of proceeds from the beneficiary under
an insurance contract;
(h) force a policy holder to terminate the existing policy and to effect a
new proposal from him within three years from the date of such
termination;
(i) have, in case of a corporate agent, a portfolio of insurance business
under which the premium is in the excess of fifty percent of total
premium produced;
(j) apply for fresh licence to act as an insurance agent, if his licence
was earlier cancelled by the designated person;
(k) become a remain the Director of an insurance company;
36
(iii) Every insurance agent shall, with a view to conserve the insurance
business already procured through him, make every attempt to ensure
remittance of the premiums by the policy holders within the stipulated
time, by giving time to the policy holder orally or in writing;
Cancellation of licence
9. The designated person may cancel a licence of an insurance agent if
the insurance agent suffers, at any time during the currency of the
licence, from any of the disqualifications mentioned in sub-section (4)
of section 42 of the Act, and recover form him the licence and the
identity card issued earlier;
Issue of duplication licence
10. The Authority may issue a duplicate licence replace a licence lost,
destroyed, or multilated on payment of rupees fifty
Non-application to existing insurance
11. Nothing contained in Regulations 4 to 6 of these Regulations shall
apply to the existing agent before the commencement of these
Regulations.
37
38
COMPANY PROFILE
Bajaj Auto Ltd. foundedin 1942 by (Late) Shri Jamnalal Bajaj, is India’s
largest two & three-wheeler manufacturer & Exporter producing 1.2 million
units, with Market Capitalization of Rs. 8000 Crore. Bajaj Auto has an
existing network of over 375 dealers across India & a Distributor network
in 60 cities.
Allianz’ links with India started in the 1920s. Allianz first arrived in India
in 1928 when it opened a branch in Delhi. In September 2001, Bajaj Allianz
received the license from the IRDA to start selling life products.
39
over decades, both Allianz AG and Bajaj Auto have experienced substantial
growth in demanding environment.
40
INVEST GAIN(ENDOWMENT PLAN)
41
CASH CARE (MONEY BACK PLAN)
• Product Definition : This is a with profit money back plan. Cash Care
plan offers high yield and liquidity ease. This plan also works as a self-
financing scheme on your insurance plan, whereby a substantial part of
the proceeds come back in the form of survival benefits.
Besides giving you regular cash benefits this plan is that it takes care of
your life insurance needs also. Irrespective of the cash benefits already
paid, the risk cover throughout the term of the plan remains equivalent to
the Basic Sum Assured.
• Eligibility : The minimum and maximum age at entry are 12 and 55
years. The maximum age of maturity is 70 years.
• Maturity Benefits : Due date and amount of survival/maturity benefits
depend upon – In case of survival to maturity all declared reversionary
bonuses plus interim bonus plus a possible terminal bonus is paid on
maturity in addition to 50% of sum assured.
Cash care plan offers 75% of the sum assured as four survival benefits at
equal intervals before maturity at an incremental rate.
• Death Benefits : The death benefit will be the sum assured plus
declared reversionary bonuses plus interim bonus, irrespective of the
cash payouts already made. In addition to the above, the company may
pay an interim bonus if death occurs after the most recent bonus
declaration date.
42
choice(minimum 10 & maximum 40 years) with a life cover
continuing up to the age 80.
• Eligibility : Minimum and maximum age of entry are 15 & 60.
Maximum premium ceasing age is 80. the minimum term of the policy
is 10 years.
• Maturity benefits : In case of survival to age 80, the sum assured plus
declared reversionary bonuses plus interim bonus plus a possible
terminal bonus is paid. Thereafter the policy terminates.
• Death Benefits : The death benefit will be the sum assured plus
declared reversionary bonuses plus interim bonus. In case of death
after 15 full policy years, the company may pay terminal bonus.
RISK CARE (PURE TERM INSURANCE)
43
For the policy holder the plan highlights the low cost insurance cover
with tax benefits and return of premium, makes it a cost effective
insurance to the policyholders who look for some maturity proceeds.
• Maturity Benefits : The amount of single premium or the sum total
of the annual premiums will be returned at the time of maturity as a
loyalty pay-out, only if the policy continues for the full term.
• Death Benefits ; IN case of pre mature death during the policy term,
the basic sum assured is paid to the nominee.
44
3. You are also eligible for Tax Benefits under Section 88 and Section
(10 D) of the Income Tax Act.
These packages offer you the choice of providing a unique Start of Life
Benefit for your child. For a nominal amount an additional Sum
Assured subject to a maximum limit of Rs. 10 lacs will become
payable to enable the child start his/her professional life smoothly, in
case of an unfortunate death or Accidental Permanent Total Disability
of the Policy Holder during the term of the policy. This benefit will not
be available in the event of accidental permanent total disability after
age 65 of the policy holder.
45
Death Payout :
In the event of unfortunate death of the child during the policy term,
the payouts shall be as under :
Premiums paid will be refunded without interest
Below 7 years and the policy will terminate.
Above 18 years and below 24 Outstanding payouts will be paid as one lump
years sum and the policy will terminate
SWARNA VISHRANTI
Product :
You can take control of your future and ensure a retirement you can look forward to.
This plan helps you to prudently plan for your retirement today, so that you don’t
have to worry about inflation, declining interest rates and rising medical bills in the
future as also ensures the financial security of your family. The annuity payable
under this plan will ensure that your earnings never stop during your lifetime.
With Bajaj Allianz Swarna Vishranti, you have the option to choose the following
additional benefits :
You have the option to include a Term Cover in your policy, which will provide an
additional life insurance protection at a nominal cost. This also ensures that the
pension available to spouse is further supplemented.
46
1. The Sum Assured along with all accrued bonuses will be used to purchase an
immediately annuity. The immediate annuity will be purchased at rates prevailing at
that point of time.
2. Option to take lump sum : You have the option to take upto 33% of Sum Assured
plus accrued bonuses on the vesting date as a lump sum. This amount would be tax
free in your hand, as per current tax laws. The balance amount will be used to
purchase an immediate annuity.
3. Open Market Option : You have the option to purchase an immediate annuity from
Bajaj Allianz or from any other company. If the immediate annuity is purchased from
Bajaj Allianz, the amount available for purchase of the annuity will be marked up by
2%. At present, we offer our immediate annuity plan for life, Swarna Raksha, tied to
this plan 4. The minimum installment of annuity from Bajaj Allianz is Rs. 1000/-.
The annuity mode may be changed to make each installment more than the minimum
requirement. If it is still below the minimum, the Sum Assured + Accrued Bonuses
would be paid.
Added Assurance
In the unfortunate event of death during the deferment period, your spouse will have
the option to take the Sum Assured plus accrued bonuses as a lump sum or purchase
an annuity to get regular income for life. For the immediate annuity, your spouse will
have the Open Market Option as well. Bajaj Allianz immediate annuity, with a mark
up of 2% will be available only if the spouse is above 45 years of age. In all ages
lower than 45, the Sum Assured + Accrued bonuses would be paid out.
Apart from covering the risk of natural death, these plans also provide for the policy
holder to choose up to five additional benefits. One can select a specific combination
of additional benefits best suited to ones needs.
47
• Combination – Protect : This is a comprehensive protection against the risk
related to accident and disabilities. This package offers three rider benefits,
namely, Accidental death Benefit, Accidental Total/Partial disablement Benefit
and Waiver of Premium Benefit.
• Combination- Health : The health pack is a comprehensive coverage against
health relateds. It covers Critical illness Benefit and Hospital Cash Benefit.
• Combination – Total : The total pack covers both accidental as well as health
related Benefits.
Riders
48
Accidental Permanent Total/Partial Disability Benefit
Accidents are unpredictable and so are the consequences. They may lead to a
disability – partial or total. This benefit provides a financial cushion against such
misfortunes. One will get 50% of the Sum Assured in case of partial disability and
100% in case of total disability. (Subject to a maximum of Rs. 25,00,000/- for
partial and Rs. 50,00,000/- for total disability under all policies with Bajaj Allianz
taken together).
Waiver of Premium Benefit
An accident may lead to permanent total disability, limiting one’s ability to earn.
Bajaj Allianz of Premium Benefit is a helping hand when one needs it most. It
waives off all future premiums while keeping the valuable life insurance cover
alive, thus enabling you to life up to your commitments.
49
ADDITIONAL FEATURES
Flexibility in Coverage
At Bajaj Allianz, we believe in offering benefits and not just products. We realize
that you are unique and your needs for insurance vary with time. We therefore offer
you the flexibility of inclusion of coverage or exclusion of coverage at each policy
anniversary, subject to conditions relating to such inclusions and exclusion.
“Comprehensive Accident Protection” can be included and excluded at each policy
anniversary. Family Income Benefit, Critical Illness Benefit and Hospital Cash
Benefit can be taken at inception only. CI & HC can be reduced or excluded
subsequently at any policy anniversary. Once reduced or excluded, they can not be
increased or included subsequently.
50
51
RESEARH METHODOLOGY
The main aim of research is to find out the truth which Is hidden and which has
not been discovered yet Though each research study has its own specific purpose,
these can be-
1. To gain familiarity with a phenomenon or to achieve new insights into it
(exploratory and formative research studies).
2. To portray the accurately the characteristics of a particular individual, situation
or a group (descriptive research).
3. To determine the frequency with which something occurs or with which it is
associated with something else.
52
4. To test a hypothesis of a casual relationship between variables (hypothesis-
testing research)
Types of Research
53
7. Conceptual Research:
It is related to some abstract ideas or theory
8. Empirical Research:
It is data based research, coming with conclusions, which are capable oT being
verified by the observation and experiment.
9. Diagnostic Research:
Such a research follow a case study method or in depth approaches to reach the
basic casual relation.
10. Exploratory Research:
The objective of this research is the development of hypothesis rather their
testing.
Research Design:
A research design is the arrangement of conditioned for collection and analyses
of data in a manner that aims to combine relevance To the research purpose which
economy in procedures.
So it is clear from the above definition thai vnry first step in the process of
marketing research is systematic design which can be defined as a specification of
methods and procedure for acquiring the information needs to structure or solve
problems.
The main characteristics of research design can summarize in two words
• Anticipation
• Specification
54
Functions of research design:
55
(a) The survey of concerning literature happens to be the most simple and
fruitful method of formulating precisely the research problem or developing
hypothesis and their usefulness be evaluated as a bases for further research. It may
also be considered whether the already stated hypothesis suggest new hypotheses. In
this way the researcher may review and build upon the work already done by the
others, but in oases where hypotheses have not yet been formulated, his track to
review the available material for deriving the relevant hypotheses from it.
(b) Experience survey means the survey of people who have had practical
experience with the problem to be studied. The object of such a survey is to obtain
insight into the relationship between variables and new ideas relating to the research
problem. For such survey people who are competent and can
contribute new ideas may be carefully selected may then be interviewed by the
investigator. The researcher must prepare an interview schedule for the systematic
questioning of information But the interview must ensure flexibility in the sense that
the respondent should be allowed to raise issues and questions which the investigator
has not previously considered. Generally the experience collecting interview is likely
to be long and may last few hours. Hence it is often considered desirable to send the
copy of the questions to be discussed to the respondents for doing some advance
thinking over the various issues involved so that at the time of interview, they may
able to contribute effectively. Thus, an experience survey may enable the researcher
56
to define the problem more concisely and help in the formulation about the practical
possibilities for doing different types of research
(b) Analysis of insight stimulating examples is also a fruitful method for
suggesting hypotheses for research It is particularly suitable in areas where there is
little experience to serve as a guide. This method consists of the intensive study of
selected instances of the phenomenon in which one is interested. For this purpose the
existing records, if any, may be examined. The unstructured interviewing may take
place, or some other approach may be adopted Attitude of the investigator, the
intensity of the study and the ability of the researcher to draw together diverse
information into a unified interpretation are the main features which make this
method an appropriate procedure for evoking.
Experience indicates that for particular problems certain types of instances are more
appropriate then others. One can mention few examples of insight stimulating cases
such as the reactions of marginal individual, the study of
individuals who are in transition from one stage to another, the reaction of individuals
from different social strata and the like, in general cases that provide sharp contrasts
or have striking features are considered relatively more useful while adopting this
method of hypotheses formulation Thus in an exploratory formulation research study
which merely leads to insights or hypotheses. It must continue to remain flexible so
that many different facets be a problem may be considered as and when they arise
and come to the notice to the researcher
57
Qs. 1) What is your source of Income?
Business 52%
Others 30%
58
Qs. 2) What do your prefer to invest?
Shares 21%
Insurance 22%
Others 11%
59
Qs. 3) How much can you per year?
<10000 37%
10000-15000 26%
15000-20000 17%
>20000 20%
60
Qs. 4. On which criteria do you invest ?
<10000 37%
10000-15000 26%
15000-20000 17%
>20000 20%
61
Qs. 5) On which criteria do you invest?
Expert 43%
62
Qs. 6) Do you have life insurance policy ?
Yes 32%
No 68%
63
Qs. 7) What type of plan would you prefer ?
Endowment 25%
64
Qs.8) What attribute attracts you most while taking an insurance plan ?
Investment 25%
Others 05%
65
Qs.9) For what duration would you like hold the policy ?
66
Qs.10) Which insurance companies brand would you perfer ?
Lic 68%
Others 32%
67
Qs.11) What is your main expectation from the insurance company ?
Security 38%
Service 20%
Flexibility 09%
Liquidity 08%
68
Qs. 12) Are you satisfied by the service offered by the isurance company ?
Yes 60%
No 40%
69
Qs.13)What additional benefit do you want from your plicy ?
Accidental 38%
70
Qs.14) Awareness of Bajaj Allianz Life Insurance Co. in India ?
Rural 2%
Semi-Urban 5%
Urban 39%
71
72
LIFE INSURANCE PRODUCTS
INTRODUCTION
The nature of needs for life assurance varies from person to person. Apart from the
basic need to insure one’s life, there may be a specific need for fixed sums of money
for other purposes. Savings through insurance can be broken into two main
component parts viz., life insurance protection and Survival benefit.
MAJOR CLASSIFICATION
a. Endowment assurance plan
b. Whole life assurance plan
c. Term assurance plan
d. Plans for children
e. Pension plans
The plans are discussed below –
a. Endowment assurance plan
This is the most popular form of assurance at the present time. Under this plan the
sum assured is payable on the date of maturity i.e., at the end of the fixed term of
years or on the death of the life assured, should that occur previously.
The plan is an ideal combination of both family protection and the savings element
and answers most of the needs of the insuring public. It provides cover against the
death of the bread-winner of the family during the term of the policy and offers an
accumulated savings at the end of the term should the life assured survive the term of
the policy.
Endowment plan is really a combination of life assurance and investment.
b. Whole life assurance plan
This plan is a permanent contract, premiums may be payable throughout life or up to
a certain age and sum assured is payable only on death. The element of protection is
the dominating element and that of provision for old age is totally absent.
73
This type of assurance provides a large amount of life cover than any other
permanent type of life assurance and is therefore the most inexpensive type of
permanent protection for dependants. It has the disadvantage that the premiums
continue in old age when the ability to pay will be less.
c. Term assurance plan
This plan is designed to cater to the need of the public who require risk cover for a
short period. The sum assured is payable only on death of the life assured during the
term of the policy. There is no maturity value to a pure term plan.
Insurers are now offering two types of term assurance plans-with return of premium
and without return of premium. In a with return of premium plan all the premiums
paid by the policy holder during the term of the policy are returned on maturity,
without any interest. Whereas nothing is paid on maturity of a pure term assurance
plan.
Convertible term assurance plans are also being offered by many insurers, designed
to meet the needs of young people who are on the threshold of their careers and have
prospects of increase in income after a short period. The objective is to provide
maximum insurance at minimum cost and at the same time offer a flexible contract
which can be altered into endowment assurance after some years.
d. Plans for Children
Many of the insurance companies are offering special plans for children under which
money is provided at various intervals or as choosen according to the needs. These
policies also provide for protection in case of a sudden demise of the guardian. The
amount of money saved through such a plan may be utilized for the education or
marriage of the child.
e. Pension plans
Plans under this envisage payment of annuity. An annuity is a periodic payment
made, in exchange for purchase money, for the remainder of the lifetime of the
named person or for a specified period irrespective of the duration of human life. The
annuities do not participate with the profit of the insurer.
74
All the insurers, except LIC are offering deferred annuity plans which provide
monthly pension after the vesting date during the lifetime of an annuitant and also
allow for return for a lump sum if opted. LIC is offering immediate annuity where
under in return for a lump um consideration called purchase price, the proposer will
receive monthly pension.
Comparative Chart of Endowment plans
75
Comparative Chart of Endowment plans
76
Comparative Chart of Money Back plans
77
Comparative Chart of Term plans
78
Comparative Chart of Term plans
79
Comparative Chart of Children plans
80
Comparative Chart of Children plans
81
Comparative Chart of Whole Life plans
82
Name of the Bajaj Allianz AVIVA HDFC ICICI
Company Standard Prudential
Name of the Swarna Pension Plus Personal Forever Life
Plan Visranti Pension (RP)
Min/Max 18/65 18/65 18/60 18/60
Age of
Enttry
Max age of 45/70 50/70 50/70 50/70
Maturity
Min/Max 5/40 5/52 10/35 5/30
Term
Min/Max Y/HY/Q/M Y/HY/Q/M Y: Rs. 1800 Min SA: Rs.
Contribution YP YP 50000
Rs. 5000 Rs. 6000
Guaranteed - 103% , 104%, No SA @ 3.5% p.a.
Returns 105% for the first year
Death SA+Acc. SA+Acc. Contribution SA+Acc. Bonus
Benefit Bonus Bonus refunded @
8% p.a.
Extra - Yes No No
additional Min Rs. 1000
contribution
Surrender Y 1/2/3 : 0 ? Y1/2/3:0 Y1/2/3:0
value 30% of Y4++:50%P- Y4++:35%PP –
Premium 1st 1st
YP
Free choice Yes Yes Yes Yes
of annuity
provider
83
Comparative Chart of Pension plans
84
85
Questionnaire Designing
Since the questionnaire had a very important role in the project the following things
were kept in mind while designing it –
The language used was simple and easy to understand.
The sequencing of the questions was done carefully to elucidate the respondents in
answering the questions.
The questions used were open-ended so as to extract maximum information.
Most of the questions used were objective type, so as to make it easy and less time
consuming to answer.
The questions were carefully framed to gather the right kind of information needed.
General information :
This part aimed at collecting the personal data of the respondents. This information
was very important as it helped in interpreting the insurability of the respondent. The
questions used in this part were –
1. Name
2. Address & Phone No.
3. Age
4. Gender
5. Marital Status
6. Educational Qualification
7. Occupation
8. Income
9. Family size
86
GENERAL INFORMATION
1. Name :
2. Address :
3. Phone No.
4. Age :
5. Gender : M/F
7. Educational Qualification :
Matriculate/Intermediate/Graduate/P.G./Any other
87
RESEARCH SPECIFIC INFORMATION :
This part of the questionnaire aimed at finding out the insurance status, preference
and awareness of the respondents. It also attempted to find out the potential market of
life insurance. The questions asked were as follows-
88
The next set of question aim at finding about the market awareness of Bajaj
Allianz. They analyze the reach of Bajaj Allianz among the people and the
percentage and type of market share it has acquired.
Yes/No
Management
c) If, no, then don’t you feel the need of taking a policy ?
Yes/No
Risk coverage
Tax benefit
Loan coverage
Premium charged
3. Have you heard about Allianz Bajaj Life Insurance Co. Ltd.
Yes/No
89
4. Which of the Bajaj Allianz policies have you heard about ?
Lifetime Gain
Invest Gain
Child Gain
Cash Gain
Risk Gain
Term Gain
Swarna Vishranti
5. Have you subscribed to any of these ?
Yes/No
6. If yes, which one ?
Policy term
Policy cover
Riders (if any)
7. Do you think that Bajaj Allianz is one of the leading Insurance company
in our country ?
Yes / No
8. Are you ever convinced by any Bajaj Allianz consultant to have an
Insurance Policy ?
Yes/ No
9. Are you satisfied with any Bajaj Allianz Insurance Policy ?
Yes / No
10. Are you satisfied with the returns of Bajaj Allianz policy ?
Yes / No
11. Do you think that selling Insurance policy is good as career ?
Yes / No
12. Please give your valuable suggestion what do you want in your Life
Insurance Plan
90
DIAGRAMMATIC REPRESENTATION OF THE DATA
The limiting factor for prospective private insurers will be the extensive and costly
distribution structure required. The new entrants cannot expect to duplicate the
extensive distribution network of the nationalised insurance companies. Building a
distribution network is expensive and time consuming.
The Malhotra Committee estimated that the insurance penetration in India is to the
extent of about 25% of the insurable population. As of 1999-2000, LIC’s insurance
Premium Income was approximately Rs. 32,000 crore. It is observed that currently
LIC has about 10 crore policies in force, which contribute a Premium of about 6% of
the GDS (Gross Domestic Savings ) of households in India.
Based on a report by the confederation of India industries (Cll), it is anticipated that
this figure of 10 crore policies in force is likely to double in the next decade. By the
year 2010, the premium income is expected to account for 18% of the GDS,
amounting to Rs. 512,000 crore.
1999
200 2001
150 2002
Policies in
100 2004
Force (Mn.)
50
2010
2006
2006
0
2002
2008
1999
Year
2010
91
Life Premium as a proportion of
Gross Domestic Savings
20
15
%GDS 10
5 %GDS
0
1999 2002 2006 2010
Year
In general, the Indian community is very cautious when making business decision.
Consequently, Indian consumers will scrutinize vigorously products and services
offered by insurance companies. In addition, Indian consumers prefer a a wide-range
of options. Below, currently available options for various types of insurance are
presented. Given uncertainty about life’s duration and about increasing costs and
responsibilities, consumers may opt for a life insurance policy with the following
features.
• Policies that meet an untimely accident or a premature death whereby
dependents are able to continue meeting financial obligations for some initial
period. This is very important because, in may Indian families, there is only one
earner in the household.
• Policies that meet an untimely accident involving the loss of a limb,
creating a major disability.
• Policies that avail owners of a tax rebate, a fixed rate of return on the
insurance investment, and a nontaxable payout upon maturity.
• Policies that provide a bonus it insured has not withdrawn any sum of
money during the insured period, (certain sums can be withdrawn after the policy
has been in effect for specified periods of time).
92
• Policies that provide for a housing loan at very favorable interest rates
after the insurance policy has been in effect for a specified duration.
93
Type of Policies Preferred
Types of Policies
Type of Policy No. of Policies Percentage
Endowment 88 50.87%
Money Back 73 42.20%
Pesion 6 3.47% Endowment
Child Care 2 1.16% Money Back
Term 2 1.16% Pesion
Whole Life 2 1.16% Child Care
Term
Whole Life
This survey shows that a majority of the people prefer Endowment and Money-back
policies. The preference for endowment policies though is more than money-back
plans. People in the private
sector have also started showing preference for pension plans. Term plans & Whole
life plans preference is quite low.
94
Security 25.60%
Saving 24.40%
Investments 21.30%
Tax Rebate 16%
Special event
Management 12.70%
30.00%
25.00%
20.00%
15.00%
Series1
10.00%
5.00%
0.00%
nt
e
ng
ts
y
at
rit
ve
en
vi
eb
cu
le
Sa
tm
R
Se
ia
es
ec
Ta
v
In
Sp
The distribution above shows that while buying a life insurance policy, a person
considers the security factor primary. It shows the highest percentage rating. A next
thing that a person considers is savings and investment element in the policy. A
person is concerned about the amount of returns that he would get on his money at
the time of maturity. Special
95
No. ofPercentage
inviduals Coverage
Govt. Service 23 20.90%
Self
Coverage Area
Employed 19 17.27%
Private
Service 68 61.81%
Govt. Service
Self Employed
Private Service
Out of a total sample survey of 110, the maximum respondents were from the
private sector, which covered 61.81% of the survey. Government sector employees
covered were 20.90% and self-employed people were 17.27% An attempt was made
to include a fair mix of people of all the three sectors so that the study the shows
relevant outputs.
events like education of children, marriage of daughter, providing for old age
pension etc. are also important considerations while buying a life insurance policy.
96
Market awareness of Bajaj Allianz
Awareness Percentage
Yes 71.43%
No 28.57%
Yes
No
97
Percentage-wise Breakup of Respondents to buy Insurance policy in Future
Yes
No
In the survey conducted around 60% of the respondents feel the need of insurance in
near future as they are either underinsured or uninsured. Around 40% of the
respondents feel that they do not need insurance in future as they are either
sufficiently insured or do not feel the need of getting insured.
98
Company Preference of individuals
Name ofNo. of
Company Policies Percentage
LIC 85 65.38%
Allianz Bajaj 4 3.07%
ICICI
Prudential 4 3.07%
Birla Sunlife 2 1.53%
Metlife 1 0.76%
HDFC
Standard 1 0.76%
Max. New
York 1 0.76%
Aviva 1 0.76%
No Policy 31 23.84%
They survey conducted showed that the maximum number of existing policies
were from LIC, which shows 65.38% of the market share. Out of the private insurers
ICICI Prudential & Allianz Bajaj 3.07% of the market. Rest of the insurers also
99
shares a small portion of the market. The research shows the chunk of market share
enjoyed by LIC.
TRAINING OPERATION
Branch Manager
100
Consultant
*
RSM – Regional Sales Manager
**
RTM- Regional Training Manager
CONCLUSION
101
The study aimed at finding out the market preference and makes a comparative
analysis of the products of various life insurers as compared with those of Bajaj
Allianz.
It was found that most of the people give preference to the products of Life Insurance
Corporation of India. LIC being a government backed undertaking and having been
in operation since a long time, it has gained the faith of people. Though now with the
privatization of the insurance sector the thinking pattern of people is changing day by
day, but we can not expect overnight miracles. People are buying life insurance from
private players because the services provided by them are of a better quality than that
of LIC. A person buys insurance basically for the purpose of risk coverage. If the
claims are not settled in time, it would defeat the whole purpose of insurance.
Another thing that was found was that there is a slow market shift. Traditionally,
people were taking up endowment and money back plans largely. But nowadays,
products such as pension plans and child care plans are much in demand. The pension
market is estimated to grow at a fast pace.
It was found that the market awareness of Bajaj Allianz is poor. Among private
insurers, people are more conversant with names such as ICICI and HDFC. They can
relate these to insurance, as they are already into financial services. On the other
hand, Bajaj Allianz is mostly related to Bajaj automobiles.
Bajaj Allianz policies were found to be competitive with those of other insurers. The
premium rates of Bajaj Allianz are quoted to be quite low as compared with those of
other insurers. The Family Income Benefit and Hospital Cash Benefit are unique in
their plans.
102
SUGGESTION
103
Bajaj Allianz launched its pension plan Swarna Vishranti recently. It was an
appreciable step as the company recognized the potentials of the growing pension
market. This product would be helpful in tapping this market.
During the study, it was found that though the individuals in high-income bracket
were aware of Bajaj Allianz as a life insurer, the awareness among the mass was
found to be poor. People can not relate to Bajaj Allianz as a life insurer. They relate
to it to bajaj automobiles. Therefore, it is imperative that the company advertises
extensively.
Another trend that was found that people were more attracted towards unit linked
products, which many insurers are offering. People perceive insurance more as an
investment avenue than for risk coverage. Therefore companies like Birla sunlife,
Aviva, ICICI Prodential, Om Kotak Mahindra are offering unit linked products which
are attracting the customer. Thus it may be perceived that customers are getting
attracted towards unit-linked plans. Bajaj Allianz can also launch a policy, which
shall be a pure unit linked plan.
104
BIBLIOGRAPHY
• BOOKS – C.R.Kothari, RM method & techniques,
105
• Insurance marketing by Mr. Satish Pandey,
• WWW.Bajajallianzlife.insurance.com,
• Business Today,
• Economic Times,
• Business Standards,
• IRDA. Com
106
107
ANNEXURE
Your needs for insurance protection will vary at different stages of life. Sometime,
you may need to release a part of your savings from insurance commitments and
utilize it for other pressing needs. The Bajaj Allianz CashGain is ideal for those who
want to reap and enjoy the benefits of their life insurance policy at regular intervals
during their lifetime.
Bajaj Allianz CashGain is a specially designed plan that offers a host of additional
benefits you may choose to develop a sound financial portfolio for your family.
Among the many unique benefits, the most significant is the Family Income
Benefit(FIB) that sustains the family by compensating the loss of regular income due
to death or permanent disability.
Available as :
• Bajaj Allianz CashGain Economy : The basic package.
• Bajaj Allianz CashGain Gold : With double protection
• Bajaj Allianz CashGain Diamond : With triple protection
• Bajaj Allianz CashGain Platinum : With quadruple protection
Besides giving you regular Cash Benefits, this plan takes care of your life insurance
needs also. On death during the term of policy, the following would be paid
irrespective of the Cash Benefits already paid:
• Bajaj Allianz CashGain Economy : Sum Assured + Bonuses
• Bajaj Allianz CashGain Gold : Double Sum Assured + Bonuses
• Bajaj Allianz CashGain Diamond : Triple Sum Assured + Bonuses
108
• Bajaj Allianz CashGain Platinum : Quadruple Sum Assured + Bonuses
Choice of Terms
Keeping your convenience in mind, we offer you the widest range of terms : 15, 20,
25 and 30 years.
The availability of Cash Benefits will be as under :
No. of years at the end of which Cash Benefit Becomes Due
Term 1st Cash 2nd Cash 3rd Cash 4th Cash Maturity
Benefit Benefit Benefit Benefit Benefit
15 3 6 9 12 15
20 4 8 12 16 20
25 5 10 15 20 25
30 6 12 18 24 30
a) Family Income Benefit (FIB) – The Ultimate Protection – For Your Loved
Ones
Flexibility in Coverage
Every added responsibility in your life calls for increase in your risk cover. We
provide you the option to increase coverage upto 50% of the basic Sum Assured
on each of the following happy moments in your life:
109
• Your marriage
• The birth of your first child
• The birth of your second child
Premium Payment Mode
For your convenience, we have provided 3 premium payment modes that can be
Yearly, Half-Yearly and Quarterly. We also offer a monthly premium payment
mode with salary deduction schemes. The premium for frequencies other than
yearly mode is the annual premium multiplied with the frequency factor (0.51 for
the half yearly mode, 0.26 for the quarterly mode, and 0.09 for the monthly
mode).
Tax Benefits
Premium paid are eligible for Tax Exemption under Section 88 of the Income Tax
Act. The periodic Cash benefits, maturity and death proceeds are Tax-Free under
Section 10 (10D) of the Income Tax Act. The premiums for the Critical Illness
Benefit and the Hospital Cash Benefit will be eligible for Tax Exemption under
Section 80 (D) of the Income Tax Act.
Surrender
While we do not encourage surrender of a policy as it breaks your security cover,
we realize the importance of availability of cash at a short notice in some
emergencies. Therefore, we provide you with a choice of surrendering the policy.
The guaranteed minimum surrender value in case of surrender before the first
survival benefit is 30% of all premiums paid excluding the first year premium and
the premiums for all additional benefits. The guaranteed minimum surrender value
in case of surrender after the first survival benefit is 30% of all premiums paid
after receiving the latest survival benefit excluding the premiums for all additional
benefits.
110
What is Bajaj Allianz HealthCare?
This is a three-year health insurance plan, providing comprehensive health cover
with life insurance benefit. You can choose the amount of cover for each benefit
separately in multiples of the minimum cover amount, subject to a maximum
multiple of 10.
Feature Minimum Cover
Life Cover Rs. 10,000
Hospital Cash (HC) Equal to Room charges (Max. Rs. 500
per day and Max Rs. 1000 per day in
ICU), Maximum Rs. 30,000 in a
policy year
Post Hospitalisation Benefit 50% of claim settled for HC per day,
maximum 5 days in a policy year
Surgical Benefit Equal to surgical expenses, Rs. 50,000
per policy year
Critical Illness Cover Rs. 50,000 during the policy term
Additional Permanent Rs. 50,000 payable on total disability
Total/Partial Disability and Rs. 25,000 payable on partial
(APT/PD) disability
Who is Eligible ?
All people who are between 18 and 57 years of age.
For your convenience we have provided Yearly and Monthly premium modes. The
monthly mode is available only under Salary Savings Schemes (SSS) and ECS. The
minimum premium is Rs. 1000 for yearly mode and Rs. 100 for monthly mode.
Contributions upto Rs. 10,000 will be eligible for tax benefits under Section 80D, as
per applicable tax laws.
111
conditions, stating the reason for your objections. You will be entitled to a refund of
the premium paid, subject only to a deduction of a proportionate risk premium for the
period on cover and expenses incurred on medical examination and stamp duty
charges.
Death Benefit : In case of unfortunate premature death the beneficiaries are entitled
to the Sum Assured less withdrawls or the bid price of units, whichever is higher. If
the age of the insured person is less than 7 or above 70, then the bid price of units is
paid.
There is no maturity date for this plan. There is a 100% surrender penalty on full or
partial surrender of units during the first three years. Anytime after payment of 3 full
years premiums, you may withdraw money, depending on your requirements,
through partial or complete surrender of units. In case of partial withdrawl, a
112
minimum balance of Rs. 10,000 (at Bid Price) across all funds must be maintained,
and the minimum withdrawl amount is Rs. 1000 (at Bid Price).
Within 15 days from the date of receipt of the policy, you have the option to review
the terms and conditions and return the policy, if you discharge to any of the terms &
conditions, stating the reasons for your objections. You will be entitled to a refund of
the premium paid, subject only to a deduction of a proportionate risk premium for the
113
period on cover and the expenses incurred on medical examination and stamp duty
charges.
Days of Grace
Before the payment of full 3 years premiums, premiums must be paid when due to
keep the policy in-force. Till such time the company receives 3 full years premiums,
30 days of grace period will be allowed for the yearly, half yearly and quarterly
modes and 15 days of grace will be allowed for the monthly mode.
Termination of the Policy
You and your family deserve the very best in life, and the good life you lead should
last a lifetime. However, one cannot always avoid the unpleasant surprises, and
sometimes misfortunes, in life. The “Bajaj Allianz Lifetime Care” Plan provides you
with the comfort that your near and dear ones will continue to live their life without
financial worries, even when you are not around.
What does the “Bajaj Allianz Lifetime Care” offer you
This plan not only provides insurance protection, but also ensures that your valuable
savings grow by way of compounded annual bonuses. In addition, a terminal bonus
may be paid on survival till age 80 for in-force and fully paid up policies. In case of
death after 15 full policy years, the company may pay a terminal bonus for in-force
and fully paid-up policies.
114
What are the 5 additional benefits ?
Accidents are unpredictable and so are the consequences. This may lead to a
disability-partial or total. The Bajaj Allianz Accidental Permanent Total/Partial
Disability Benefit provides a financial cushion against such misfortunes.
Type of disability Benefit
Permanent Partial Disability 50% of the Sum Assured
Permanent Total Disability 100% of the Sum Assured
* subject to a maximum of Rs. 5,00,000/- under all policies with Bajaj Allianz taken
together
** subject to a maximum of Rs. 10,00,000/- under all policies with Bajaj Allianz
taken together
115
family by paying out the Critical Illness Benefit under the plain immediately, while
other policy benefits continue (excluding Hospital Cash Benefit).
We cover 11 Critical Illness. This benefit is available for the premium payment term
only.
e) Hospital Cash Benefit
The worry of setting hospital bills(room charges) adds to the trauma of
hospitalisation. Bajaj Allianz Hospital Cash Benefit reduces this financial burden and
helps you to recover with peace of mind. This benefit is available for the premium
payment term only.
Flexibility in Coverage
At Bajaj Allianz, we believe in offering benefits and not just products. We realize
that you are unique and your needs for insurance vary with time. We therefore offer
you the flexibility of including the following benefit combination at each policy
anniversary.
Increase in risk coverage
Every added responsibility in your life calls for increase in your risk cover. We
provide you the option to include additional death coverage of 50% of the Sum
Assured on each of the following happy moments in your life.
• your marriage
• the birth of your first child
• the birth of your second child
This additional coverage is not subject to underwriting.
Eligibility
Conditions Lifetime Care Lifetime Care-
Economy Protect/Health/Total
Minimum Age at 15 18
Entry
Maximum Age at 60 50
Entry
Maximum Premium 80 80
Ceasing Age
116
Minimum Term 10 10
Minimum 5000/- for yearly, 2500/- for Half Yearly. 2000/- for
Premium(Rs.) Quarterly and 700/- for Monthly*
Sum Assured
Term Rs. 3,00,00 Rs. 5,00,000 Rs. 10,00,000
15 years 9096 15000 29760
20 years 7581 12475 24710
25 years 6810 11190 22140
30 years 6405 10515 20790
117
118