Consumer Perception

towards

HDFC Standard life

insurance

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 1

 INDEX

SR.NO. TOPIC PAGE

1 Introduction NO
.
04
1.1 An Overview 05

a. Industry Profile 05
b. Company Profile 08

c. Competitors Profile 10

1.2 Problem Statement 12

a. Objective of the study 12

b. Scopes and limitations of the study 12

2 Theoretical Frame Work 13

3 Research Methodology
18
3.1 Sources of Data 19

3.2 Sampling Design 18

4 Data Analysis 22

5 Conclusion 34

5.1 Conclusion 35

5.2 Recommendation 36

6 References 38

6.1 Text Book Reference 39

6.2 Internet Source 40

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 2

 CHAPTER 1

INTRODUCTION

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 3

 INTRODUCTION

ABOUT THE SUBJECT

Meaning of marketing

Marketing is typically seen as the task of creating promoting a delivering

goods and services to customer and business.

According to American marketing association: - “Marketing is the process

of planning and executing the conception pricing, promotion and distribution of

ideas goods and services to create exchange to satisfy individual

organizational goals.”

Service marketing is selling of services in the best interest of user/customer. It

is concerned with the scientific and plant management of service which

makes possible affair synchronization of the interest of provides as well as the

users.

The Chartered Institute of Marketing defines Marketing as - "Marketing is

the management process for identifying, anticipating & satisfying customer
requirements profitably."

Philip Kotler "Marketing is a societal process by which individuals and groups obtain
what they need and want through creating, offering and freely exchanging products
and services of value with others"

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 4

 1.1An Overview

INDUSTRY PROFILE

ORIGIN AND DEVELOPMENT OF INSURANCE INDUSTRY:

Insurance sector in is one of the booming sector in India and is growing at the rate of
15-20 per cent annum. Together with banking services, it contributes to about 7 per
cent to the country's GDP. Insurance is a federal subject in India and Insurance
industry in India is governed by Insurance Act, 1938, the Life Insurance Corporation
Act, 1956 and General Insurance Business (Nationalization) Act, 1972, Insurance
Regulatory and Development Authority (IRDA) Act, 1999 and other related Acts.

The origin of life insurance in India can be traced back to 1818 with the
establishment of the Oriental Life Insurance Company in Calcutta. It was conceived
as a means to provide for English Widows. In those days a higher premium was
charged for Indian lives than the non-Indian lives as Indian lives were considered
riskier for coverage. The Bombay Mutual Life Insurance Society that started its
business in 1870 was the first company to charge same premium for both Indian and
non-Indian lives. In 1912, insurance regulation formally began with the passing of
Life Insurance Companies Act and the Provident Fund Act.

In 1938, the first comprehensive legislation regarding insurance was introduced with
the passing of Insurance Act of 1938 that provided strict State Control over
insurance.

Insurance sector in India grew at a faster pace after independence. In 1956,

Government of India brought together 245 Indian and foreign insurers and provident
societies under one nationalized monopoly corporation and formed Life Insurance
Corporation (LIC) by an Act of Parliament, viz. LIC Act, 1956, with a capital
contributionofRs.5crore.

The General Insurance Business (Nationalization) Act, 1972 nationalized the general
insurance business in India with effect from January 1, 1973. The 107 private
insurance companies were amalgamated and grouped into four companies: National
Insurance Company, New India Assurance Company, Oriental Insurance Company
and United India Insurance Company. These were subsidiaries of the General
Insurance Company (GIC).

In 1993, the first step towards insurance sector reforms was initiated with the
formation of Malhotra Committee, headed by former Finance Secretary and RBI
Governor R.N. Malhotra. The committee was formed to evaluate the India

Insurance industry and recommend its future direction with the objective of
complementing the reforms initiated in the financial sector.

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 5

 SWOT ANALYSIS FOR INSURANCE
INDUSTRY
Major Strengths:
 Premium rates are increasing and so are commissions.

 The variety of products is increasing.

 Prospects expect more services from their brokers.

Major Weaknesses:
 Insurance companies are often slow to respond to changing needs.

 There is an increasing trend of financial weakness among the companies.

 There are more competitors for agencies to compete with banks and Internet
players.

Opportunities:
 The ability to cross sell financial services is barely being tapped.

 Technology is improving to the point that paperless transactions are available.

 The client's increasing need for an "insurance consultant" can open new ways
to service the client and generate income.

Threats:
 The increasing cost and need for insurance might hit a point where a
backlash will occur.
 Government regulations on issues like health care, mold and terrorism can
quickly change the direction of insurance. Increasing expenses and lower
profit margins will hit hard on the smaller agencies and insurance companies.
 Increasing expenses

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 6

PEST ANALYSIS - Insurance Sector in India
PEST analysis of any industry sector investigates the important factors
that are affecting the industry and influencing the companies operating in
that sector.
PEST is an acronym for political, economic, social and technological
analysis.
Political factors include government policies relating to the industry, tax
policies, laws and regulations, trade restrictions and tariffs etc.

The economic factors relate to changes in the wider economy such as

economic growth, interest rates, exchange rates and inflation rate, etc.
Social factors often look at the cultural aspects and include health
consciousness, population growth rate, age distribution, changes in tastes
and buying patterns, etc.
The technological factors relate to the application of new inventions and
ideas such as R&D activity, automation, technology incentives and the
rate of technological change.

Synergist’s PEST Analysis is a perfect tool for managers and policy

makers; helping them in analyzing the forces that are driving their
industry and how these factors will influence their businesses and the
whole industry in general. Our product also presents a brief profile of the
industry comprising of current market, competition in it and future
prospects of that sector.

Please note that the report compilation, presentation and dispatch may
take 1-2 working days.

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 7

 Company Profile

ORIGIN OF HDFC STANDARD LIFE:

HDFC Standard Life first came together for a possible joint venture, to enter the Life
Insurance market, in January 1995. It was clear from the outset that both companies
shared similar values and beliefs and a strong relationship quickly formed. In
October 1995 the companies signed a 3 year joint venture agreement.
Around this time Standard Life purchased a 5% stake in HDFC, further
strengthening the relationship.
The next three years were filled with uncertainty, due to changes in government and
ongoing delays in getting the IRDA (Insurance Regulatory and Development
authority) Act passed in parliament. Despite this both companies remained firmly
committed to the venture.
In October 1998, the joint venture agreement was renewed and additional resource
made available. Around this time Standard Life purchased 2% of Infrastructure
Development Finance Company Ltd. (IDFC). Standard Life also started to use the
services of the HDFC Treasury department to advise them upon their investments in
India.
Towards the end of 1999, the opening of the market looked very promising and both
companies agreed the time was right to move the operation to the next level.
Therefore, in January 2000 an expert team from the UK joined a hand picked team
from HDFC to form the core project team, based in Mumbai.
Around this time Standard Life purchased a further 5% stake in HDFC and a 5%
stake in HDFC Bank.

In a further development Standard Life agreed to participate in the Asset

Management Company promoted by HDFC to enter the mutual fund market. The
Mutual Fund was launched on 20th July 2000.

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 8

SWOT ANALYSIS FOR HDFC STANDARD LIFE
INSURANCE
STRENGTH:
 .Domestic image of HDFC supported by Standard Life’s international
image is strength of the company.
 Strong and well spread network of qualified intermediaries and
sales person.
 Strong capital and reserve base.
 Huge basket of product range which are suitable to all age and
income groups.

WEAKNESS:
 Heavy management expenses and administrative costs.
 Low customer confidence on the private players.
 Vertical hierarchical reporting structure with many designations and
cadres leading to power politics at all levels without any exception.
 Poor retention percentage of tied up a gents.

OPPORTUN ITIES:
 Insurable population: According to IRDA only 10% of the Population
is insured which represents around 30% of the insurable population. This
suggests more than 300m people, with the potential to buy insurance,
remain uninsured.
 There will be inflow of managerial and financial expertise from the
world’s leading insurance markets. Further the burden of educating
consumers will also be shared among many players.
 International companies will help in building world class expertise in local
market by introducing the best global practices.

THREATS
 Other private insurance companies also vying for the same uninsured
population.
 Big public sector insurance companies like Life Insurance Corporation
(LIC) of India, National Insurance Company Limited, Oriental Insurance
Limited, and People trust and go to them more.
 Poaching o f customer base by other companies.
 Most people don’t understand the need or are not willing to take
insurance policies in general.

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 9

 Competitor Profile

MAIN COMPETITOR: ICICI-Prudential Life Insurance Company ltd.

Here the main competitor is the ICICI-Prudential Life Insurance Company ltd,
with ICICI’s share at 74 per cent and prudential plc. UK’s share of 26 per cent was
incorporated o July 20, 2000, with an authorized capital of Rs 2.3 billion. The paid up
capital is Rs 1.9 billion. It commenced commercial operations on December 19,
2000, becoming one of the first few private sector players to enter the liberalized
arena.
The World Bank, the Government of India and the Indian Industry, to promote
industrial development in India by providing project and corporate finance to the
Indian industry, established ICICI LTD., in 1944. Since its inception, it has grown
from a development band to a financial conglomerate and has become one of the
largest public financial conglomerates and has become one of the largest public
financial institutions in India, financing all the major sectors of the economy.

Founded in 1848, Prudential plc. has grown to become one of the largest
providers of a wide range of savings products for the individual, including life
insurance, pensions, annuities, unit trusts and personal banking. It has a presence in
over 15 countries, and manages assets of over US $259 billion (approximately Rs
11, 3956 billion) as of December 31, 1999. In fact, Prudential’s first overseas
operation was in India, way back in 1923, to establish life and general insurance
branch agencies.

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 10

 SWOT Analysis for the Competitor

STRENGTH:
 Large network branches which is helped to customer for the
payment.
 Strong and well spread network of qualified intermediaries and
sales person.
 Strong capital and reserve base.
 Huge basket of product range which are suitable to all age and
income groups.

Weaknesses:
 High targets for financial advisors and for the sales departments.
 Many competitors in the market offer same product by the title
difference in the premium and offerings.
 Sustainable to risk associated with investments in money market.
 Try to catch middle-lower level people also.

Opportunity :
 Huge market is literally untapped; out of estimated 320 millions
insurable markets only 20% of the population is insured.

 International companies will help in building world class expertise in

local market by introducing the best global practices.

THREATS
 Other private insurance companies also vying for the same uninsured
population.
 Big public sector insurance companies like Life Insurance Corporation
(LIC) of India, National Insurance Company Limited, Oriental Insurance
Limited, and People trust and go to them more.
 Poaching o f customer base by other companies.
 Most people don’t understand the need or are not willing to take
insurance policies in general.

1.2PROBLEM STATEMENT

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 11

PROBLEM STATEMENT: To Know the Consumer perception toward the HDFC
Standard life insurance.

 OBJECTIVE OF THE STUDY:

• Study the marketing strategies of HDFC Standard Life Insurance

• Consumer perception about the various life insurance products available in

India.

• To analyze the life insurance products of HDFC Standard Life

Insurance Company and compare them with other players in Life Insurance
segment.

 Scopes & Limitation of the study:

So though the studies aim to achieve the above mentioned Objective in full earnest
and accuracy, it may be hampered due to certain limitation. Some of the limitations
are as follows:
1. To cover the various section for the society.
2. Respondents may not be at home and may have to re-contacted or replaced
by others.
3. Getting accurate response form the respondents due to their inherent
problem is difficult.
4. Limited response from client.

There is a time limitation it is not possible to study whole thing I covered some
special aspect as well as some topics.

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 12

 CHAPTER 2

Theoretical
Frame Work

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 13

 2.1 PRESENT STATUS OF THE COMPANY

HDFC Standard Life Insurance Co. Ltd was incorporated on 14th august 2000. It is a
joint venture between Housing Development Finance Corporation Limited (HDFC
Ltd.) India and UK based Standard Life Company. Both the joint venture partners
being one of the leaders in their respective areas came together in this 81.4:18.6
joint venture to form HDFC Standard Life Insurance Company Limited.

The MD and CEO of HDFC Standard Life Mr. Deepak Satwalekar, has given the
company new directions and has helped the company achieve the status it currently
enjoys. HDFC Standard Life brings to you a whole range of insurance solutions be it
group or individual or NAV services for corporations; they can be easily customized
as per specific needs.

HDFC Standard Life Insurance India boasts of covering around 8.7 lac lives by
March'2009. The gross incomes standing at a whopping Rs. 2, 856 crores, HDFC
Standard Life Insurance Corporation is sure to become one of the leaders and the
first preference for any life insurance customer.

The Banc assurance partners of HDFC Standard Life Insurance Co Ltd are HDFC,
HDFC Bank India Limited, Union Bank of India, Indian Bank, Bank of Baroda,
Saraswat Bank and Bajaj Capital.

Currently, HDFC Standard Life, a joint-venture between mortgage lender HDFC and
UK-based Standard Life Plc has a paid-up capital of Rs 1,796 crore. The company
would go at a slower pace in terms of expansion and do a need-based expansion
this fiscal, he added. The company's generated a total premium income of Rs
5,564.69 crore in FY 10 as against Rs 4,858.56 crore in FY 08, registering a year-
on-year growth of 15 per cent.

HDFC Standard Life, one of India’s leading private life insurance companies,
declared its annual results for the financial year ending March 31, 2009. The
company generated Total Premium Income of Rs. 5564.69 crores in FY2008-09
registering a year-on-year growth of 15%. The growth was primarily driven by the
company’s structured sales processes based on customer needs and their
assessments, wide range of product portfolio and diverse distribution network.
Mr. Paresh Parasnis, Principal Officer and Executive Director, said, “The financial
year 2009-10 was a defining year with the unfolding of several unexpected events -
sharp correction in financial markets and a spread of recessionary trends.

These events also had an impact on the Indian life insurance industry. We are
happy that our new policies issued grew by 16% over the last year. However, given
the uncertainty in the overall scenario, customers have reduced their annual
premium commitment on new policies. At the same time, existing policies continued
to be in force reflected in our renewal premium, which posted a healthy growth of
34%.”

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 14

In line with overall market conditions, growth in Effective Premium Income (EPI) in
respect of retail business increased by 5%, growing from Rs. 2,425 crores in 2007-
08 to Rs. 2,552 crores in 2008-09. HDFC Standard Life tracks its New Business
Premium on the basis of Effective Premium Income (EPI). EPI is calculated by giving
only a 10% value to a Single Premium policy and is an internationally accepted
indicator of an insurance company’s performance.
HDFC Standard Life maintained its healthy pipeline of products last year by
launching 11 products apart from slashing the premium rates of its Term Assurance
Plan premium rates by about 25% across different age bands. “Our entry into the
health insurance market last year with the launch of two products – SurgiCare and
Critical Care was a significant move in line with our business objective. The low
penetration of health insurance in India gives us a tremendous opportunity to provide
quality health insurance. Our health products along our complete range of life
insurance and pensions portfolio meet almost every aspect of an individual’s
requirements,” Mr. Parasnis added.
Highlights of Financial Year 2009-10
-- Total Premium Income is up by 15% at Rs. 5564.69 crores as against Rs. 4858.56
crores in FY2008-09.
-- Renewal premium collected increased to Rs. 2913.58 crores from Rs. 2173.19
crores in the previous year, registering a growth of 34%.

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 15

BALANCE SHEET ABSTRACT AND COMPANY’S GENERAL
BUSINESS PROFILE
(Submitted in terms of Part IV of Schedule VI to the Companies Act, 1956)

I. Registration Details
Registration No.
1 2 8 2 4 5 1 1
State Code

Balance Sheet Date

3 1 3 2 0 1 0

II. Capital Raised during the year (Amount in Rs. ‘000)

Public Issue Rights Issue
N I L
N I L

Bonus Issue Private Placement

N I L 5 2 5 0 0 0 0

III. Position of Mobilization and Deployment of Funds (Amount in Rs.

‘000)

Total Liabilities Total Assets

1 1 7 1 3 0 2 9 7 1 1 7 1 3 0 2 9 7

SOURCES OF FUNDS
Paid-up Capital Reserves and Surplus

1 7 9 6 0 0 0 0
5 5 2 8 9 2

Secured Loans Unsecured Loans

N I L N I L

APPLICATION OF FUNDS
Net Fixed Assets Investments

1 4 4 7 7 0 6 1 0 3 1 2 4 6 3 0

Net Current Assets Accumulated Losses

6 1 4 5 9 1 1 1 9 1 3 1 2 2

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 16

 Misc. Expenditure
N I L

IV. Performance of the Company (Amount in Rs. ‘000)

Total Income Total Expenditure

3 8 6 3 7 5 1 8 4 3 6 6 7 1 4 9

Profit/Loss Before Tax Profit/Loss After

Tax

- 5 0 2 9 6 3 1 - 5 0 2 9 6 3 1

Earnings per Share (in Rs.) Dividend %

N I L
- 3 . 2 8

V. Generic Names of Three Principal Services of the Company (as per

monetary terms)

Item Code No. (ITC Code)

N I L
Product Description
L I F E I N S U R A N C E

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 17

 CHAPTER 3

Research Methodology

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 18

 3.1 SOURCES OF DATA

Primary data: Questionnaire, Personal interviews and informal discussions

were held with HDFC Standard Life customers to ascertain the awareness and

satisfaction level. Further applying simple statistical techniques has processed the

data collected.

Questionnaire is as follows:

Questionnaire:

Put (√) on your opinion:-

1. Are you related to the life to be assured in any way?
a) Yes b) No
2. Does the life to be assured have any life and health insurance policy issued by
any insurance company?
a) LIC b) HDFC Standard life
c) Bajaj Allianz d) Others
3. Which company provides maximum cash benefits to you?
a) LIC b) HDFC Standard life
c) Bajaj Allianz d) Others
4. Frequency of premium payment?
a) Monthly b) quarterly
c) half-yearly d) annually
5. Objective of Insurance?
a) Saving b) Investment
c) Taxation d) Protection
6. How many family members you have?

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 19

 a) Less than 3 b) 4
c) 5 d) more than

7. Monthly income of your family

a) Less than 5000 b) 5000 – 8000
c) 8000 – 12000 d) more than 12000

8. How old are you?

a) Less than 30 b) 30 – 45
c) 45 – 60 d) more than 60

9. Are you married?

a) Yes b) No

10. Does the life to be assured / Proposed Policy holder have any policy with us?
a) Yes b) No

Secondary data: Published materials (Periodicals, journals, news

papers, website etc)

Personal interviews and informal discussions were held with HDFC Standard Life

customers to ascertain the awareness and satisfaction level. Further applying

simple statistical techniques has processed the data collected.

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 20

 Survey Technique:-

• Sampling: Since 100% coverage was difficult within the limited period of time.

Hence sampling survey method was adopted for the purpose of the study.

• Population: (universe) customers of HDFC Standard life Insurance Co. Ltd.

• Sampling size: A sample of fifty was chosen for the purpose of the study.

Sample considers of small investor, large investors and traders of HDFC

Standard life Insurance Co. Ltd.

• Sampling Methods: Probability sampling requires complete knowledge about all

sampling units in the universe. Since due to time constraint non-probability

sampling was chosen for the study.

• Sampling procedure: From large number of customers of HDFC Standard life

Insurance Co. Ltd. were randomly picked up.

• Field Study: directly approached respondents.

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 21

 CHAPTER 4
Data Analysis

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 22

 Analysis of Data

DATA PROCESSING

Data processing is an intermediary stage of work between data collection and data

analysis. The raw data, after collection, has been processed and analyzed in

accordance with the outline laid down for the purpose of the study. Tabulation is the

process of summarizing raw data and displaying them on compact statistical table

for further analysis. Data is further classified and categorized for the hypothesis

testing.

DATA ANALYSIS AND INTERPRETATION

Data analysis is a very important part of Research Methodology. If after collection of

data it is not analyzed in a proper way then one will not reach to a correct

conclusion. Hence for judging one’s research correctly one should analyze the data

very carefully and interpretation should be done correctly. Here we are taking the aid

of Pie Charts, Bar Graphs & the Data table to analyze the data collected by doing

the survey of 50 customers of HDFCSLI.

Data if wrongly interpreted can be misleading and create a false picture of the

organization .Hence it is very necessary that data interpretation is done in the best

possible way. Here I have tried my best to be the most accurate in interpretation of

the data. Here are some of the tools which are used in the following pages to

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 23

interpret the data collected by the aid of the questionnaires from 20 customers of

HDFC Standard life insurance Co. Ltd.

ANALYSIS & INTERPRETATION

“A SURVEY ON THE LIFE INSURANCE INDUSTRY IN INDIA”

AGE GROUP OF SURVEYED RESPONDENTS

TABLE 1:

Age group No. of Respondents

18 - 25 years 23
26 - 35 years 12
36 - 49 years 9
50 - 60 years 5
More than 60 years 1

CHART 1:

Analysis:

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 24

From the chart above we find that 46% of the respondents fall in the age
group of 18 – 25 years, 24% fall in the age group of 26 – 35 years and
18% fall in the age group of 36 – 49 years.

Therefore most of the respondents are relatively young (below 26 years of

age). These individuals could be induced to purchase insurance plans on
the basis of its tax saving nature and as an investment opportunity with
high returns.

Individuals at this age are trying to buy a house or a car. Insurance could
help them with this and this fact has to be conveyed to the consumer. As
of now many consumers have a false perception that insurance is only
meant for people above the age of 50. Contrary to popular belief the
younger you are the more insurance you need as your loss will mean a
great financial loss to your family, spouse and children (in case the
individual is married) who are financially dependent on you.

GENDER CLASSIFICATION OF SURVEYED RESPONDENTS

TABLE 2:

Particulars No. of Respondents

Male 32
Female 18

CHART 2:

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 25

 CUSTOMER PROFILE OF SURVEYED RESPONDENTS
TABLE 3:

Customer profile No. of respondents

Student 11
Housewife 3
Working Professional 20
Business 10
Self Employed 4
Government service employee 2

CHART 3:

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 26

Analysis:
From the chart above it can clearly be seen that 40% of the respondents
are working professionals, 22% are students and 20% are into business.
Therefore the target market would be working individuals in the age
group of 18 – 25 years having surplus income, interested in good returns
on their investment and saving income tax.

MARKET SHARE OF LIFE INSURANCE COMPANIES

TABLE 4:

LIFE INSURER Market Share

HDFC STANDARD LIFE 4
BIRLA SUN LIFE 3
AVIVA LIFE INSURANCE 6
BAJAJ ALLIANZ 7
LIC 53
TATA AIG 6
ICICI PRUDENTIAL 11
ING VYSYA 6
BHARTI AXA 2
OTHERS 2

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 27

CHART 4:

Analysis:
In India, the largest life insurance company is Life Insurance Corporation
of India. It has been in existence in India since 1956 and is completely
owned by the Government of India. Today the organization has grown to
2048 offices serving 18 crore policies and has a corpus of over 340000
crore INR.

ANNUAL PREMIUM PAID BY INDIVIDUALS FOR LIFE INSURANCE

TABLE 5:

Premium paid (p.a.) No. of respondents

Rs. 5000 - Rs. 10000 20

Rs. 10001 - Rs. 15000 12

Rs. 15001 - Rs. 24900 9

Rs. 25000 - Rs. 50000 5

Rs. 50001 - Rs. 60000 2

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 28

 Rs.60001 - Rs. 80000 1

Rs. 80001 - Rs. 100000 1

CHART 5:

ANNUAL PREMIUM PAID BY INDIVIDUALS FOR LIFE INSURANCE

Analysis:
From the chart above we find that, 40% of the respondents surveyed pay
an annual premium less than Rs. 10001 towards life insurance. 24% of the
respondents pay an annual premium less than Rs. 15001 and 18% pay an
annual premium less than Rs. 25000. Hence we can safely say that HDFC
SLIC would be able to capture the market better if it introduced
products/plans where the minimum premium starts at Rs. 5000 per
annum.
Only 10% of the respondents pay more than Rs. 25000 as premium and
most products sold by HDFC SLIC have Rs.12000 as the minimum annual
premium amount. They should introduce more products like Easy Life Plus

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 29

and Safe Guard where the minimum premium is Rs.6000 p.a. and Rs.
12000 p.a. respectively. This would definitely increase their market share
as more individuals would be able to afford the policies/plans offered.

POPULAR LIFE INSURANCE PLANS

TABLE 6:

Type of Plan No. of Respondents

Term Insurance Plans 19
Endowment Plans 22
Pension Plans 3
Child Plans 2
Tax Saving Plans 4

CHART 6:

POPULAR LIFE INSURANCE PLANS

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 30

Analysis:
From the chart given above we can clearly see that 44% of the
respondents hold endowment plans and 38% of the respondents hold
term insurance plans. Endowment plans are very popular and serve two
purposes – life cover and savings.
If the policy holder dies during the policy term the nominee gets the death
benefit that is, sum assured and accumulated bonus. On survival the
policy holder receives the survival benefit with a bonus.

A term plan is a pure risk cover plan wherein the insured pays a lower
premium for a higher sum assured. Term insurance is the cheapest form
of insurance and helps the policy holder insure himself for a relatively low
premium. For the returns sensitive investor term plans do not find favor
as they do not offer a return in case the individual does not die during the
policy term.

CONSUMER WILLINGNESS TO SPEND ON LIFE INSURANCE PREMIUM

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 31

TABLE 7:

Willingness to spend on premium No. of respondents Percentage

Less than Rs. 6,000 7 14%

Rs. 6,001 - Rs. 10,000 14 28%

Rs. 10,001 - Rs. 25,000 21 42%

Rs. 25,001 - Rs. 50,000 7 14%

Rs. 50,001 - Rs. 1,00,000 1 2%

CHART 7:

CONSUMER WILLINGNESS TO SPEND ON LIFE INSURANCE PREMIUM

Analysis:
From the graph above, we can clearly see that 42% of the respondents would be
willing to spend between Rs. 10001 – Rs. 25000 for life insurance. 28% would be
willing to spend between Rs. 6001 – Rs. 10000 per annum. Only 14% would be
willing to spend more than Rs. 25000 per annum as life insurance premium.

We could say that the maximum premium payable by most consumers is less
than Rs. 25000 p.a. This is further reduced as most customers have already
invested with LIC, ICICI Prudential, Birla Sun Life, Bajaj Allianz etc.

KRUPANIDHI BUSINESS SCHOOL, BANGALORE 32

HDFC SLIC is faced with a large amount of competition. There are 18 insurance
companies in India inclusive of LIC. Hence to capture a larger part of the market
the company could introduce more reasonable plans with lesser premium
payable per annum.

CHART SHOWING IDEAL POLICY TERM

TABLE 8:

Ideal policy term No. of respondents

3 - 5 years 9
6 - 9 years 7
10 - 15 years 18
16 - 20 years 7
21 - 25 years 4
26 - 30 years 1
More than 30 years 1
Whole life Policy 3

CHART 8:

CHART SHOWING IDEAL POLICY TERM

Analysis:

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From the chart given above it can be seen that 36% of the respondents
prefer a policy term of 10 – 15 years, 18% prefer a term of 3 – 5 years and
14% prefer a term of 6 – 9 years. This means that HDFC SLIC could
introduce more plans wherein the premium paying term is less than 15
years.

The outlook of insurance as a product should be changed from something

which you pay for your whole life (whole life policy) and do not receive
any benefit (the nominee only receives the benefit in case of your death)
to an extremely useful investment opportunity with the prospects of good
returns on savings, tax saving opportunities as well as providing for every
milestone in your life like marriage, education, children and retirement.

Summary of Findings

• The new product should be customizing oriented that is the product must be

produced related to needs and wants of the customer.

• Research and development dept. should conduct proper research for

Developing a new product.

• The company should go for mass advertisement to launch the new product.

• The company should give some sales promotion to the new product.

• The company should go for more promotional activities.

• The company should provide more benefits to the clients/customers..

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 CHAPTER 5
CONCLUSION

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 5.1 Conclusion

HDFC Standard life Insurance Co. Ltd. is leading insurance company in India.

In every department HDFC Standard life Insurance Co. Ltd. has managed the

functions efficiently and successfully. With such high penetration HDFC

Standard life Insurance Co. Ltd. has more then 1 million customers who have

put their faith and investment into the fastest growing life insurance company

in India With a deep sense of commitment and confidence, HDFC Standard

life Insurance Co. Ltd. looks forward to a continuing saga of dynamic growth,

achievement and a total service for energy.

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 5.2 Recommendations

Though huge number of insurance company is in Indian market, but HDFC Standard

life Insurance Co. Ltd. has to make various steps for keeping up 1st position in the

insurance market.

• The figure shows clearly that about the customer satisfaction of HDFC SLI that

the most of them are very satisfied with the services. Yet there are few

dissatisfied customers. They should find out the reason and try to satisfy them.

• Most of the customers are believing in the sincere services of HDFC SLI in rural

areas and it is reachable to all class of people but few of customers feel that the

services is not reachable in all the places. It to be looked by HDFC SLI.

• Customers will be very happy if the complains are attended timely.

• The company should concentrate more in R&D department in order to develop

new policies and schemes.

• Website to provide all assistance and information on products and services,

online buying and online renewals

• The authority has to be decentralized. It helps in taking quick decisions in unit

levels.

• Pension and health are two areas that have to make tremendous

growth potential.

• The policy structure should be designed in customize orientation i.e related to

needs and wants of the market.

• Take initiate step to implement the opportunity of the market.

• The company should invest more money in advertising department.

• The authority has to take care of the various promotional activities.

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• The marketing department must adopt the Customer Relationship Management

(CRM).

• New product should be launched into the niche market.

• The company must provide the best financial guide to the customers for their

financial solutions.

• The company should increase its sells in group policies and NRI

Policies.

• The organization should take special care on specialized departments for Bank

assurance, Corporate Agency and Group Business.

• The management should provide well networked Customer Care Centers (CCCs)

with state of art IT systems.

• Alternate channels of distribution like corporate brokers, online selling and banc

assurance has to increase their share in the business of all the companies.

• Follow-up the consumers and give suitable financial solution to the consumers to

increase their business.

• Majority of total respondent would like to be a loyal customer of HDFC SLI so the

company should provide extra facilities to the loyal customers.

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 CHAPTER 6

REFRENCES

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 6.1 Text Book Reference

TEXT BOOKS:-

• S. Balachandran, “IC 33 life insurance” – First edition- 2007 and March 2009
reprint.
• Black Skipper, “Life and health insurance” – 13th edition and 1st Indian reprint,
2003.

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 6.2 Internet Source
WEBSITES:-
• www.insurance-solutions.info
• www.tataaig.com
• www.irdaindia.org
• www.businessinsurance.com
• www.hdfcinsurance.com
• www.5paisa.com
• www.sharetermspaper.com
• www.timefinincialhelp.com

Questionnaire:

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Put (√) on your opinion:-
1. Are you related to the life to be assured in any way?
a) Yes b) No
2. Does the life to be assured have any life and health insurance policy issued by
any insurance company?
a) LIC b) HDFC Standard life
c) Bajaj Allianz d) Others
3. Which company provides maximum cash benefits to you?
a) LIC b) HDFC Standard life
c) Bajaj Allianz d) Others
4. Frequency of premium payment?
a) monthly b) quarterly
c) half-yearly d) annually
5. Objective of Insurance?
a) Saving b) Investment
c) Taxation d) Protection
6. How many family members you have?
a) Less than 3 b) 4
c) 5 d) more than
7. Monthly income of your family
a) less thon 5000 b) 5000 – 8000
c) 8000 – 12000 d) more than 12000
8. How old are you?
a) less than 30 b) 30 – 45
c) 45 – 60 d) more than 60
9. Are you married?
a) Yes b) No
10. Does the life to be assured / Proposed Policy holder have any policy with us?
a) Yes b) No

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