A STUDY ON

“RECRUITMENT OF ADVISORS
AND SALES OF FINANCIAL
PRODUCTS THROUGH THEM
AND
COLLECTION OF DESIRABLE
PREMIUM.”

SUBMITTED BY:

AMIT KUMAR SUMAN

ROLL NO: 7348
DUAL: C
BIIB (ICIB)
2007-09
amitsuman.icibpune@gmail.com

Balaji Institute of International Business (BIIB), Pune

Survey No. 55/2-7, Tathawade, Opp. Wakad Police Station, Off Pune-Mumbai
Highway,
Pune - 411 033. (T): +91 - (020) - 6674 1081/ 83/ 84/ 85
Date: 22nd July, 2008
 CONTENTS

ACKNOWLEDGEMNT

PREFACE

EXECUTIVE SUMMARY

INTRODUCTION TO THE INDUSTRY

INTRODUCTION TO THE COMPANY

RECRUITMENT OF ADVISORS

SALES AND DISCRIPTION OF THE FINANCIAL PRODUCT

RECOMMENDATIONS

CHALLENGES IN LIFE INSURANCE SECTOR

BIBLIOGRAPHY

2
 TO WHOM IT MAY CONCERN
This is to certify that Mr. Amit Kumar Suman of Balaji Institute Of International
Business, Pune (PGBM in Marketing 2007-09 Batch) has completed his on-the-job two
months summer training in Reliance Life Insurance Company Limited, Patna from 2 nd
May 2008 to 30th June 2008, in connection to his course curriculum.
Mr. Amit Kumar Suman was briefed about the work of recruiting ten financial advisors
and getting policies for the company up to rs. 2 lakhs. He achieved the target and has
proved his skills as a sales manager that was assigned to him as his project profile and
we admire his talent.
We put on record and appreciate the excellent conceptual abilities and communication
skills of Mr. Amit Kumar Suman and wish him all the very best for a bright and
promising career.

3
 ACKNOWLEDGEMENT

First of all I would like to thank the Management at Reliance Life Insurance co.for
giving me the opportunity to do my two-month project training in their esteemed
organization. I am highly obliged to Ms.Rashmi Paul (Branch head) for granting me to
undertake my training at Patna main branch (Exhibition road).

I express my thanks to all Sales Managers under whose able guidance and direction
specially Mr. Ranjeet kr. Malhotra(sales manager) who was my mentor and helped me
alot,through which I was able to give shape to my training. Their constant review and
excellent suggestions throughout the project are highly commendable.

My heartfelt thanks go to all the executives who helped me gain knowledge about the
actual working and the processes involved in various departments.

Thanking you… Amit Kumar Suman

4
 PREFACE
The liberalization of the Indian insurance sector has been the subject of much heated
debate for some years. The policy makers where in the catch 22 situation wherein for
one they wanted competition, development and growth of this insurance sector which
is extremely essential for channeling the investments in to the infrastructure sector. At
the other end the policy makers had the fears that the insurance premia, which are
substantial, would seep out of the country; and wanted to have a cautious approach of
opening for foreign participation in the sector.

As one of the rare occurrences the entire debate was put on the back burner and the
IRDA saw the day of the light thanks to the maturing polity emerging consensus among
factions of different political parties. Though some changes and some restrictive clauses
as regards to the foreign participation were included the IRDA has opened the doors for
the private entry into insurance.

Whether the insurer is old or new, private or public, expanding the market will present
multitude of challenges and opportunities. But the key issues, possible trends,
opportunities and challenges that insurance sector will have still remains under the
realms of the possibilities and speculation. What is the likely impact of opening up
India’s insurance sector?

The large scale of operations, public sector bureaucracies and cumbersome procedures
hampers nationalized insurers. Therefore, potential private entrants expect to score in
the areas of customer service, speed and flexibility. They point out that their entry will
mean better products and choice for the consumer. The critics counter that the benefit
will be slim, because new players will concentrate on affluent, urban customers as
foreign banks did until recently. This seems to be a logical strategy. Start-up costs-such
as those of setting up a conventional distribution network-are large and high-end niches
offer better returns. However, the middle-market segment too has great potential. Since
insurance is a volumes game. Therefore, private insurers would be best served by a
middle-market approach, targeting customer segments that are currently untapped

5
 EXECUTIVE SUMMARY
In today’s corporate and competitive world, I find that insurance sector has the
maximum growth and potential as compared to the other sectors. Insurance has the
maximum growth rate of 70-80% while as FMCG sector has maximum 12-15% of
growth rate. This growth potential attracts me to enter in this sector and RELIANCE
LIFE INSURANCE has given me the opportunity to work and get experience in highly
competitive and enhancing sector.

• The success story of good market share of different market organizations

depends upon the availability of the product and services near to the customer,
which can be distributed through a distribution channel. In Insurance sector,
distribution channel includes only agents or agency holders of the company. If a
company like RELIANCE LIFE INSURANCE, TATA AIG, MAX etc have
adequate agents in the market they can capture big market as compared to the
other companies.

• Agents are the only way for a company of Insurance sector through which
policies and benefits of the company can be explained to the customer .

6
 INTRODUCTION TO THE INDUSTRY

NEED OF LIFE INSURANCE

. The functions of Insurance can be bifurcated into two parts:
1. Primary Functions
2. Secondary Functions
3. Other Functions

The primary functions of insurance include the following:

Provide Protection - The primary function of insurance is to provide protection against
future risk, accidents and uncertainty. Insurance cannot check the happening of the risk,
but can certainly provide for the losses of risk. Insurance is actually a protection against
economic loss, by sharing the risk with others.

Collective bearing of risk - Insurance is a device to share the financial loss of few among
many others. Insurance is a mean by which few losses are shared among larger number
of people. All the insured contribute the premiums towards a fund and out of which the
persons exposed to a particular risk is paid.

Assessment of risk - Insurance determines the probable volume of risk by evaluating

various factors that give rise to risk. Risk is the basis for determining the premium rate
also

Provide Certainty - Insurance is a device, which helps to change from uncertainty to

certainty. Insurance is device whereby the uncertain risks may be made more certain.

The secondary functions of insurance include the following:

Prevention of Losses - Insurance cautions individuals and businessmen to adopt suitable

device to prevent unfortunate consequences of risk by observing safety instructions;
7
installation of automatic sparkler or alarm systems, etc. Prevention of losses cause lesser
payment to the assured by the insurer and this will encourage for more savings by way of
premium. Reduced rate of premiums stimulate for more business and better protection to
the insured.

Small capital to cover larger risks - Insurance relieves the businessmen from security
investments, by paying small amount of premium against larger risks and uncertainty.

Contributes towards the development of larger industries - Insurance provides

development opportunity to those larger industries having more risks in their setting up.
Even the financial institutions may be prepared to give credit to sick industrial units
which have insured their assets including plant and machinery.

The other functions of insurance include the following:

Means of savings and investment - Insurance serves as savings and investment, insurance
is a compulsory way of savings and it restricts the unnecessary expenses by the insured's
For the purpose of availing income-tax exemptions also, people invest in insurance.

Source of earning foreign exchange - Insurance is an international business. The country

can earn foreign exchange by way of issue of marine insurance policies and various other
ways.
Risk Free trade - Insurance promotes exports insurance, which makes the foreign trade
risk free with the help of different types of policies under marine insurance cover.

8
 THE HISTORY OF INDIAN INSURANCE INDUSTRY
Life Insurance

In 1818 the British established the first insurance company in India in Calcutta, the
Oriental Life Insurance Company. First attempts at regulation of the industry were made
with the introduction of the Indian Life Assurance Companies Act in 1912. A number of
amendments to this Act were made until the Insurance Act was drawn up in 1938.
Noteworthy features in the Act were the power given to the Government to collect
statistical information about the insured and the high level of protection the Act gave to
the public through regulation and control. When the Act was changed in 1950, this meant
far reaching changes in the industry. The extra requirements included a statutory
requirement of a certain level of equity capital, a ceiling on share holdings in such
companies to prevent dominant control (to protect the public from any adversarial
policies from one single party), stricter control on investments and, generally, much
tighter control. In 1956, the market contained 154 Indian and 16 foreign life insurance
companies. Business was heavily concentrated in urban areas and targeted the higher
echelons of society. “Unethical practices adopted by some of the players against the
interests of the consumers” then led the Indian government to nationalize the industry. In
September 1956, nationalization was completed, merging all these companies into the
so-called Life Insurance Corporation (LIC). It was felt that “nationalization has lent the
industry fairness, solidity, growth and reach.”

Some of the important milestones in the life insurance business in India are:

1912: The Indian Life Assurance Companies Act enacted as the first statute to regulate
the life insurance business.

1928: The Indian Insurance Companies Act enacted to enable the government to collect

statistical information about both life and non-life insurance businesses.

9
1938: Earlier legislation consolidated and amended to by the Insurance Act with the

objective of protecting the interests of the insuring public.

1956: The market contained 154 Indian and 16 foreign life insurance companies.

10
 MAJOR PLAYERS IN THE LIFE
INSURANCE INDUSTRY IN INDIA

• Life Insurance Corporation of India (LIC)

Life Insurance Corporation of India (LIC) was established on 1 September 1956 to

spread the message of life insurance in the country and mobilise people’s savings for
nation-building activities. LIC with its central office in Mumbai and seven zonal offices
at Mumbai, Calcutta, Delhi, Chennai, Hyderabad, Kanpur and Bhopal, operates through
100 divisional offices in important cities and 2,048 branch offices. LIC has 5.59 lakh
active agents spread over the country.

The Corporation also transacts business abroad and has offices in Fiji, Mauritius and
United Kingdom. LIC is associated with joint ventures abroad in the field of insurance,
namely, Ken-India Assurance Company Limited, Nairobi; United Oriental Assurance
Company Limited, Kuala Lumpur; and Life Insurance Corporation (International), E.C.
Bahrain. It has also entered into an agreement with the Sun Life (UK) for marketing unit
linked life insurance and pension policies in U.K.

In 1995-96, LIC had a total income from premium and investments of $ 5 Billion while
GIC recorded a net premium of $ 1.3 Billion. During the last 15 years, LIC's income
grew at a healthy average of 10 per cent as against the industry's 6.7 per cent growth in
the rest of Asia (3.4 per cent in Europe, 1.4 per cent in the US).

LIC has even provided insurance cover to five million people living below the poverty
line, with 50 per cent subsidy in the premium rates. LIC's claims settlement ratio at 95
per cent and GIC's at 74 per cent are higher than that of global average of 40 per cent.
Compounded annual growth rate for Life insurance business has been 19.22 per cent per
annum

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IN ADDITION TO ABOVE STATE INSURERS THE FOLLOWING HAVE BEEN
PERMITTED TO ENTER INTO INSURANCE BUSINESS: -

The introduction of private players in the industry has added to the colors in the dull
industry. The initiatives taken by the private players are very competitive and have given
immense competition to the on time monopoly of the market LIC. Since the advent of the
private players in the market the industry has seen new and innovative steps taken by the
players in this sector. The new players have improved the service quality of the
insurance. As a result LIC down the years have seen the declining phase in its career. The
market share was distributed among the private players. Though LIC still holds the 75%
of the insurance sector but the upcoming natures of these private players are enough to
give more competition to LIC in the near future. LIC market share has decreased from
95% (2002-03) to 70 %( 2007-08)

Insurance Companies in India (April 2008)

Bajaj Allianz Life AMP Sanmar Life Insurance Birla Sun Life Insurance
Insurance
Aviva Life Insurance HDFC Life Insurance ICICI Prudential Life
Insurance
Max Newyork Life Metlife India Insurance Reliance Life Insurance
Insurance
Shiram Life Insurance Tata AIG Life Insurance SBI Life Insurance
Bharti AXA Life ING Vysya Life Insurance Sahara Life Insurance
Insurance
Kotak Mahindra General Insurance Royal Sundaram
Insurance Corporation India Insurance

1. HDFC Standard Life Insurance Company Ltd.

HDFC Standard Life Insurance Company Ltd. is one of India’s leading private life
insurance companies, which offers a range of individual and group insurance solutions. It
is a joint venture between Housing Development Finance Corporation Limited (HDFC
Ltd.), India’s leading housing finance institution and The Standard Life Assurance
Company, a leading provider of financial services from the United Kingdom. Their
cumulative premium income, including the first year premiums and renewal premiums is
Rs. 672.3 for the financial year, Apr-Nov 2005. They have managed to cover over
11,00,000 individuals out of which over 3,40,000 lives have been covered through our
group business tie-ups.
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2. Max New York Life Insurance Co. Ltd.

Max New York Life Insurance Company Limited is a joint venture that brings together
two large forces - Max India Limited, a multi-business corporate, together with New
York Life International, a global expert in life insurance. With their various Products and
Riders, there are more than 400 product combinations to choose from. They have a
national presence with a network of 57 offices in 37 cities across India.

3. ICICI Prudential Life Insurance Company Ltd.

ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank, a
premier financial powerhouse and Prudential plc, a leading international financial
services group headquartered in the United Kingdom. ICICI Prudential was amongst the
first private sector insurance companies to begin operations in December 2000 after
receiving approval from Insurance Regulatory Development Authority (IRDA). The
company has a network of about 56,000 advisors; as well as 7 bancassurance and 150
corporate agent tie-ups.

4. Om Kotak Mahindra Life Insurance Co. Ltd.

Kotak Mahindra Old Mutual Life Insurance Ltd. is a joint venture between Kotak
Mahindra Bank Ltd. (KMBL), and Old Mutual plc.

5.Birla Sun Life Insurance Company Ltd.

Birla Sun Life Insurance Company is a joint venture between Aditya Birla Group and
Sun Life financial Services of Canada.

6.SBI Life Insurance

SBI Life Insurance is a joint venture between the State Bank of India and BNP Paribas
Assurance. SBI Life Insurance is registered with an authorized capital of Rs 2000 crores
and a Paid-up capital of Rs 1000 Crores. SBI owns 74% of the total capital and BNP
Paribas Assurance the remaining 26%.

State Bank of India enjoys the largest banking franchise in India. Along with its 7
Associate Banks, SBI Group has the unrivalled strength of over 14,500 branches across
the country, arguably the largest in the world. BNP Paribas Assurance is the insurance
arm of BNP Paribas - Euro Zone’s leading Bank. BNP Paribas, part of the world's top 10

13
group of banks by market value and part of Europe top 3 banking companies, is one of
the oldest foreign banks with a presence in India dating back to 1860. BNP Paribas
Assurance is the forth largest life insurance company in France, and a worldwide leader
in Creditor insurance products offering protection to over 50 million clients. BNP Paribas
Assurance operates in 42 countries mainly through the bancassurance and partnership
model.

SBI Life has a unique multi-distribution model encompassing Bancassurance, Agency

and Group Corporates.

SBI Life extensively leverages the SBI Group as a platform for cross-selling insurance
products along with its numerous banking product packages such as housing loans and
personal loans. SBI’s access to over 100 million accounts across the country provides a
vibrant base for insurance penetration across every region and economic strata in the
country ensuring true financial inclusion.

7. Allianz Bajaj Life Insurance Company Ltd.

Bajaj Allianz Life Insurance Company Limited is a Union between Allianz SE, one of
the world’s largest Life Insurance companies and Bajaj Auto, one of the biggest 2- &- 3
wheeler manufacturers in the world.

Allianz SE is a leading insurance conglomerate globally and one of the largest asset
managers in the world, managing assets worth over a Trillion Euros (Over R. 55,00,000
crores). Allianz SE has over 115 years of financial experience in over 70 countries.

Bajaj Auto is one of the most trusted name is Indian auto for over 55 years. At Bajaj
Allianz customer delight is our guiding principle. Ensuring world-class solutions by
offering customized products with transparent benefits, supported by best technology is
our business philosophy.

DATA ABOUT TOTAL REVENUE COLLECTIONS IN 2006-07

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 Accelerated Growth
Fiscal Year No. of policies sold in FY New Business in FY(Rs. in cr.)
2001-2002(6 mths) 21,376 7
2002-2003 1,15,965 69
2003-2004 1,86,443 180
2004-2005 2,88,189 857
2005-2006 7,81,685 2717
2006-2007 20,79,217 4270

OTHER PLAYERS:

 Tata AIG Life Insurance Company Ltd

 ING Vysya Life Insurance Company Private Limited

 Metlife India Insurance Company Pvt. Ltd.

 AMP SANMAR Assurance Company Ltd.

 Dabur CGU Life Insurance Company Pvt. Ltd.

15
Marketing of Insurance In India
Insurance is in a manner of speaking the last frontier in the financial sector to open. It is
also a sector, which leads to benefits across the full spectrum, from the individual who
now have wider choices, to the economy, which see increased savings, to the
infrastructure sector, which can look forward to long term funding being available. In an
under-insured economy, newer channels of distribution have to be utilized to intensify
the reach of insurance both in urban and rural markets. This will create huge employment
opportunities not only within insurance companies but also as agents and consultants of
insurance companies.

Marketing Mix Policies

Different companies can choose to position themselves differently and hence the
Marketing Mix is different. However, there are certain common characteristics that one
can cull out from the possible strategies that companies adopt.

Product:

The development of flexible products to suit individual requirements is what will

differentiate the winners from the also-rans. The key to success is in providing insurance
solutions, not standardized insurance products. The concept of riders/optional benefits
has already been a huge innovation brought about by the new players, which has led to
customization of products for individual needs. However, companies may differentiate
themselves on the basis of product segments that they choose to focus on and excel in.

Place:

Different companies may however choose different channels and different geographies to
focus on. The channel options are - tied agency force, corporate agents and brokers and
this is an area where different companies will make different choices. Many companies
like HDFC Standard Life are focusing on all channels whereas companies like Max New
York Life are focusing on the tied agency force only. Customer interface will be a key
challenge for life insurance companies and includes every that interaction that the
customer has with the company, such as sales, new business underwriting, policy
servicing, premium payments, claim processing and so on. Technology can play a crucial
role in delivering the highest standards of service set by the company and it will be
imperative for any serious player to excel in all of these.
16
Price:

Price is a relevant differentiator only in two segments - pure term insurance and in pure
annuities. Here too, service delivery and financial strength will need to be present at a
minimum acceptable level for price to be a relevant differentiator. In case of savings
oriented products, long-term returns generated are more relevant than just the price of the
product. A focus on generating good investment performance and keeping a tight control
on costs help in generating good long-term maturity value for customers. Norms have
been laid down on all of these by IRDA and adhering to these while delivering good
returns will be a challenge.

Promotion and Advertising:

The level of demand is latent and will have to be activated considerably. The market
needs to be developed. Greater awareness of insurance and the need to have it as a
protection tool rather than as a tax planning measure needs to be appreciated by the
Indian people. Various communication tools including advertising, direct marketing and
road shows contribute to all this and different companies take different approaches on
these.

Process:

Cashless settlement: One of the most defining and customer-friendly changes that
we’ve seen in recent years relates to the way claims settlements are made. The advent of
the third-party administrator (TPA) regime has facilitated the transition to the hugely
convenient era of cashless settlement of health and auto insurance claims. TPAs are
entities who process claims on behalf of insurers: the IRDA licenses them after it is
satisfied that they have the financial strength, the trained manpower, the infrastructure
and the skills to undertake this activity.

Likewise, with auto insurance, the TPA ties up with garages and authorized service
centers for cashless settlement of auto insurance claims.

Lower premiums: The spirit of competition and the broadening of the risk experience of
insurance companies have contributed to a fall in premiums over the years. That’s
because, other things being equal, an insurer who covers the lives just of 10 people bears
a higher risk than an insurer who covers the lives of, say, 100 people. Further, a broader
17
base will provide greater efficiencies on costs such as distribution, management and
claims. A broad basing of the mortality experience, therefore, gives insurers the
elbowroom to compete by lowering premiums, and that trend is expected to continue.

Premium payment flexibility: Insurers have imparted certain flexibility to premium

payment options in order to address this concern. For instance, one now have the option
to pay your premiums upfront, which is then carried forward for the tenure of the policy.
The yearly premiums are drawn from the initial corpus. Insurers have also introduced the
concept of ‘automatic cover maintenance’ to protect your policy from lapsing owing to
your omission to pay your premium on time. Under this, in the event of your not paying
the premium, the insurer dips into your investment account to the extent of the premium.
Of course, this comes with an in-built drawback: your investment portion diminishes
year on year to the extent of the amount paid to cover your risk.

Physical Evidence:

This can play a significant role for marketing in the Indian scenario. Since Internet users
are comparatively lesser than countries such as US, the offline mode will be preferred in
India. Although the distribution model is largely agent-based, wherever the customer is
in contact with the company, this factor can play a significant role in luring the customer.

People:

The most important factor that materializes sales and maintains customer relationships
on a long-term basis is this factor. No matter what distribution strategy a company
adopts, customer relationship has to be taken care of in order to maintain the customer
base on a long-term basis.

18
 INTRODUCTION TO COMPANY
RELIANCE LIFE INSURANCE CO. LTD.

Our Founder

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

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

• But the role Dhirubhai cherished most was perhaps that of India’s greatest wealth
creator. In one lifetime, he built, starting from the proverbial scratch, India’s largest
private sector enterprise.

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

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

• Undaunted, Dhirubhai managed to convince a large number of first-time retail

investors to participate in the unfolding Reliance story and put their hard-earned
money in the Reliance Textile IPO, promising them, in exchange for their trust,
substantial return on their investments. It was to be the start of one of great stories of
mutual respect and reciprocal gain in the Indian markets.
19
• Under Dhirubhai’s extraordinary vision and leadership, Reliance scripted one of the
greatest growth stories in corporate history anywhere in the world, and went on to
become India’s largest private sector enterprise.

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

20
RELIANCE CAPITAL
Reliance Life Insurance Company Limited is a part of Reliance Capital Ltd. of the
Reliance - Anil Dhirubhai Ambani Group. Reliance Capital is one of India’s leading
private sector financial services companies, and ranks among the top 3 private sector
financial services and banking companies, in terms of net worth. Reliance Capital has
interests in asset management and mutual funds, stock broking, life and general
insurance, proprietary investments, private equity and other activities in financial
services.

• Reliance Capital Limited (RCL) is a Non-Banking Financial Company (NBFC)

registered with the Reserve Bank of India under section 45-IA of the Reserve Bank of
India Act, 1934.

• Reliance Capital sees immense potential in the rapidly growing financial services
sector in India and aims to become a dominant player in this industry and offer fully
integrated financial services.

• Reliance Life Insurance is another step forward for Reliance Capital Limited to offer
need based Life Insurance solutions to individuals and Corporates.

Reliance capital entered into the life insurance business by acquiring AMP Sanmar in
October 2005. The business was thereafter renamed Reliance Life Insurance. Today
RLIC has over 20 products - 16 individual plans and 4 employee benefit plans -
including the two new innovative products – Connect to Life and Reliance Money
Guarantee Plan - that were launched recently.

Reliance Life Insurance Company (RLIC) has been accorded the ISO 9001-2000
certificate for its best-in-class management systems in Quality, Customer & Process
orientation.
With this, RLIC is one of the only two life insurance companies in India to get ISO
9001:2000 certification covering all functional areas.
The scope of the certification covers the entire gamut of business processes ranging
from product design, sales - front-end and back-end operations, customer care and
investment, to all business support functions. The certification has been awarded by

21
internationally acclaimed Bureau Veritas and is valid till 2010 subject to continued
satisfactory operation of RLIC's Quality Management System.
"This certification is a significant milestone in our continuous quest to offer innovative
products, outstanding services and improved customer satisfaction. It indicates that we
have been able to install systems, processes & performance measures that are in line with
the best in the industry and will form the basis of our business growth in future", said
P Nandagopal, CEO, Reliance Life Insurance Company.
Reliance Life Insurance is the fastest growing life insurance company in India and has
an incremental market share of 4 per cent amongst private insurers. The company has
third largest distribution network in terms of number of agents operating out of 143
locations across the country.
CORPORATE OBJECTIVE

At Reliance Life Insurance, we strongly believe that as life is different at every stage, life
insurance must offer flexibility and choice to go with that stage. We are fully prepared
and committed to guide you on insurance products and services through our well-trained
advisors, backed by competent marketing and customer services, in the best possible
way.

• It is our aim to become one of the top private life insurance companies in India
and to become a cornerstone of RLI integrated financial services business in
India.

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CORPORATE VISION AND MISSION
Vision
Empowering everyone live their dreams.
Mission
Create unmatched value for everyone through dependable, effective, transparent and
profitable life insurance and pension plans.
Our Goal
Reliance Life Insurance would strive hard to achieve the 3 goals mentioned below:
Emerge as transnational Life Insurer of global scale and standard
Create best value for Customers, Shareholders and all Stake holders
Achieve impeccable reputation and credentials through best business practices

Achievements

• RLIC has been one of the fast gainers in market share in new business premium
amongst the private players with an incremental market share of 4.1% in the
Financial Year 2007-08 – from 3.9% in April 07 to 8% in Feb 08. ( Source:
IRDA)
• Also continues to be amongst the fast growing Private Life Insurance
Companies with a YOY growth of 195% in new business premium as of
Mar’08.
• A Company that has crossed 1.7 Million policies in just 2 years of operation,
post take over of AMP Sanmar business.
• Initiated Express Life – an Unique ’Over the Counter’ sales process for Unit
Linked Insurance Policies in the Industry.
• Accomplished a large distribution ramp-up in the Industry in a short span of time
by opening 600 branches in 10 months taking the overall branch network
above 740.
• RLIC continues to be one of the two Life Insurance companies in India to be
certified ISO 9001:2000 for all the processes.

23
 • Awarded the Jamnalal Bajaj Uchit Vyavahar Puraskar 2007- Certificate of
Merit in the Financial Services category by Council for Fair Business Practices
(CFBP).

GROWTH OF RELIANCE LIFE INSURANCE SOME FACTS (MAY 2008) :

HOW THEY STACK UP

Premium income of life insurers in Rs crore

April - June Growth Total

2007 2008 % Share (%)
LIC 8580.84 7524.56 -12 52.55
ICICI Prudential 1056.45 1,590.27 51 11.11
Bajaj Allianz 731.85 829.24 13 5.79
SBI Life 426.39 1,148.67 169 8.02
HDFC Standard 355.93 490.40 38 3.42
Max New York 289.74 501.16 73 3.50
Reliance Life 204.10 557.33 173 3.89
Birla Sun Life 174.63 501.53 187 3.50
Total Private 3930.95 6,795.64 73 47.45
Total Market 12511.80 14,320.20 14 100.00

Reliance life expect to break even by 2010-11 and until then they may require an
additional rs.700 cr. of capital.
Around 97% of reliance life’s business comes from unit linked insurance plans.
Average tenor of it’s ULIPs is 12.7 yrs and avg. ticket size of the policy stands
around 21000/-
Alternate channel incl. corporate agents, broker, direct marketing brought in 25%
of company’s business.
This year company plan to reach out further to the rural areas and introduce
MICROINSURANCE product.
The company is planning to double its manpower base from the present level of
14000 employees.
New business premium at rs.2754 cr in 2007-08 against 930 cr in the previous year.
The company had add 600 more branches in the last year to expand its business
network and now it has 744 branches.

24
As only 30% of the business comes from the top 25 cities and the balance comes
70% comes through the other smaller towns, company has followed a conscious
strategy to setup branches in smaller towns to tap the blue oceans.

RECRUITMENT OF ADVISORS

Advisors are the backbone of any life insurance company.They play the most important
and key role for company to cashing the revenue through selling the insurance policies.
Some years ago Advisors were known as Agents but Reliance introduced them as
Advisors which seems to be more appropriately.

As a Reliance Life Insurance Advisor, the sky is not the limit—you can go beyond.

In India, ever since the insurance industry has opened up, opportunities for insurance
companies have become limitless. To tap this opportunity, they require insurance agents
because agents are one of the most significant modes of bringing in much-needed
business to the company.

At Reliance Life Insurance, you will not merely be an insurance agent—you will be a
Financial Advisor. You will have an important role to play because you have to give
valuable advice to prospective customers about their financial planning.

Opportunities for Reliance Advisors

Make a good profit without a heavy investment.

Enjoy the benefit of residual income.
Maintain flexible work hours.
Earn attractive commissions.
Participate in exciting recognition programs.
Associate with Reliance - One of the strongest brands of the country.
Capitalize on the growing Insurance market.
Become a full time sales manager.

25
Benefits Available for Advisors

Apart from being remunerated well, Advisors get a lot of recognition and can win awards
by participating in the monthly, quarterly, half yearly, yearly business competition. These
business reviews can fetch foreign tours and travel free of cost. Easy way to globe trot is
to become an advisors with RLIC.
Become an Advisor to really see the benefits. It is told that "seeing is believing '. We are
ahead and we say "experiencing is believing" are you ready to experiment.

Number of Agents

Number of Agents
Company Name
Dec 07 (Nos)
Aviva Life 31,390
Bajaj Allianz Life 273138
Bharti Axa 10016
Birla Sunlife 86264
Future Generali 0
HDFC Std Life 132662
ICICI Prudential 262893
ING Vysya 48428
Kotak 34714
Max New York 29,876
MetLife 32389
Reliance Life 157052
Sahara Life 12244
SBI Life 33969
Shriram Life 16521
TATA AIG 32528
LIC 1159586

* The Figures are provisional and unaudited

26
PRODUCTS OFFERED BY RELIANCE
LIFE
Reliance has number of insurance products in it’s Portfolio. It offers different products
for different customer profile.It target its product according to the needs of people which
make them its customer.

Protection Plans
In today’s uncertain world, there could be calamity at every step of the life. It is up to
you to ensure that your family stays protected always.
Reliance Protection Plans helps you do exactly the same. You have a wide range of
options to choose a plan from. Right from limited period plans to lifetime protection
plans, you can opt for the one that suits your lifestyle.
While we understand that nothing can compensate for the loss of a life, we intend to
provide you the peace of mind. Investing in Reliance Protection Plans would mean your
family’s future is in safe hands.
1.Reliance Term Plan
Invest in the Reliance Term Plan, a pure life insurance plan that offers you
comprehensive and affordable coverage for a limited period of time to suit your needs.

2. Reliance Simple Term Plan

Make a smart investment move by investing in the cost-effective Reliance Simple Term
Plan, which offers you comprehensive coverage for a specified period of time to suit
your need.

3. Reliance Special Term Plan

Imagine a life insurance policy, which on maturity returns to you all the premiums you
27
had paid for your basic policy. The Reliance Special Term Plan offers that and much
more.

4. Reliance Credit Guardian Plan

The Reliance Credit Guardian Plan secures your family from any loan liabilities you
have incurred in case of your untimely demise. On survival at maturity, you will be
returned all the premiums paid for the basic policy.
5. Reliance Special Credit Guardian Plan
Invest in the Reliance Special Credit Guardian Plan and protect your family from any
loan liabilities you have incurred. On survival at maturity, all premiums paid for the basic
policy will be returned to you.

6. Reliance Endowment Plan

The Reliance Endowment Plan gives you financial independence by allowing you to
decide the amount of Sum Assured based on your current financial position and expected
future expenses… Dream!!..

7. Reliance Special Endowment Plan

Imagine an endowment plan that protects you for a certain period even after you have
received your lump sum—that is exactly what the Reliance Special Endowment Plan
offers you with other added benefits.

8. Reliance Connect 2 Life

The Reliance Connect 2 Life Plan gives you the option to upgrade your life cover to keep
pace with your changing lifestyle. As your income grows, your family will have
sufficient cover.

9. Reliance Whole Life Plan

Give your family a lifetime of timely financial support by investing in the Reliance
Whole Life Plan. This will help you enjoy your life to the fullest.

28
10. Reliance Wealth + Health Plan
Invest in the Reliance Wealth Health Plan and balance your health needs and wealth
needs, without compromising on either health or wealth.

11. Reliance Cash Flow Plan

Invest in the Reliance Cash Flow Plan and reap the dual benefits of a life insurance plan
and easy liquidity through lump sum cash, which means you can get a percentage of the
Sum Assured at periodic intervals.

Savings & Investment Plans

In life, you have always given your family whatever they have wanted. Yet, there are
some promises you have to fulfil, such as taking your family for a vacation, or buying
that dream house.
Set aside some money to achieve these specific goals with the help of Reliance Savings
& Investment Plans. The plan allows you to experience the joys of life and provide for
your family’s needs.
Enjoy life without worrying about the promises you have made—we are here to fulfil
them.

1. Reliance Super Invest Assure Plan

Reliance Super Invest Assure is a complete plan which addresses your vital needs like
Flexibility, Security, Investment Return and Financial Planning. With all its key benefits,
it is here to ensure that there will always be more than you can ask for!

2. Total Investment Plan I - Insurance

Reliance TIPS -Series I- Insurance is a Unit Linked Investment + Insurance Plan that
helps you meet all your financial needs, without the complexity of managing multiple
products.

29
3. Reliance Wealth + Health Plan
Invest in the Reliance Wealth Health Plan and balance your health needs and wealth
needs, without compromising on either health or wealth.

4. Reliance Automatic Investment Plan

The Reliance Automatic Investment Plan is an enhanced unit linked plan that allows you
to choose the right investment mix to reap maximum benefits. It also provides you with
enhanced Life Cover.

5. Reliance Money Guarantee Plan

To reap the benefits of a rising market and to protect yourself from any market decline,
invest in the unit linked Reliance Money Guarantee plan that gives you the perfect
balance between Protection and Savings.

6. Reliance Cash Flow Plan

Invest in the Reliance Cash Flow Plan and reap the dual benefits of a life insurance plan
and easy liquidity through lump sum cash, which means you can get a percentage of the
Sum Assured at periodic intervals.

7. Reliance Market Return Plan

The Reliance Market Return Plan gives you insurance protection and allows you to
benefit from investment growth. It works through your life and meets the changing
requirements you may have from time to time.

8. Reliance Endowment Plan

The Reliance Endowment Plan gives you financial independence by allowing you to
decide the amount of Sum Assured based on your current financial position and expected
future expenses.

30
9. Reliance Special Endowment Plan
Imagine an endowment plan that protects you for a certain period even after you have
received your lump sum—that is exactly what the Reliance Special Endowment Plan
offers you with other added benefits.

10. Reliance Whole Life Plan

Give your family a lifetime of timely financial support by investing in the Reliance
Whole Life Plan. This will help you enjoy your life to the fullest.

11. Reliance Golden Years Plan

The Reliance Golden Years Plan helps you save systematically and generate the much-
needed corpus to help you enjoy life after retirement.
12. Reliance Golden Years Plan Value
Realise all your dreams of playing golf, or going for a world tour after retirement by
investing in the Reliance Golden Years Plan Value, which helps you generate the amount
you will need for the future.

13. Reliance GoldenYears Plan Plus

Invest in the special Reliance Golden Years Plan Plus that not only helps you build the
corpus you need after, but also collects a basic minimum amount in case something were
to happen before you realise your dreams.

14. Reliance Connect 2 Life Plan

The Reliance Connect 2 Life Plan gives you the option to upgrade your life cover to keep
pace with your changing lifestyle. As your income grows, your family will have
sufficient cover.

31
Retirement Plans
You are a young and earning individual. The income you earn allows you to enjoy life,
your only worry being whether you will be able to continue the same lifestyle after
retirement.
A Reliance Retirement Plan will help you save money for your retirement. It ensures that
you continue to get some income after retirement thereby ensuring that you do not have
to depend on any other person or make any compromises to maintain the same lifestyle.
Invest in a Reliance Retirement Plan today and enjoy life after retirement on your own
terms.

1. Total Investment Plan II - Pension

When you invest in the Reliance Total Investment Plan, you give yourself the assurance
that you will make each one of your dreams come true!.

2. Reliance Golden Years Plan

The Reliance Golden Years Plan helps you save systematically and generate the much-
needed corpus to help you enjoy life after retirement.
3. Reliance Money Guarantee Plan
To reap the benefits of a rising market and to protect yourself from any market decline,
invest in the unit linked Reliance Money Guarantee plan that gives you the perfect
balance between Protection and Savings...

32
Child Plans
Being a parent is one of the joys of life. Your child looks up to you and depends on you
for love, protection and support. You want to provide your child with the best in life.
The Reliance Child Plan helps you save systematically so that you can secure your
child’s future needs. Be it higher education, his or her first home or any other
requirement, you will always be there for your child when he or she needs you.
So, invest in a Reliance Child Plan right away—it is the best gift you could ever give
your child.

1. Reliance Super InvestAssure Plan

Reliance Super InvestAssure is a complete plan which addresses your vital needs like
Flexibility, Security, Investment Return and Financial Planning. With all its key benefits,
it is here to ensure that there will always be more than you can ask for!

2. Reliance Child Plan

Save systematically and secure the financial future of your child by investing in the
Reliance Child Plan and let your child enjoy today without worrying about tomorrow.

3. Reliance Secure Child Plan

Reliance Life Insurance presents a unit linked insurance plan that secures your child’s
financial future, leaving you free from worry.

4. Reliance Wealth + Health Plan

Invest in the Reliance Wealth Health Plan and balance your health needs and wealth
needs, without compromising on either health or wealth.

33
SOME LUCRATIVES PLANS WHICH RELIANCE OFFERS
RELIANCE ENDOWMENT PLAN

It takes a lot for a dream to become a reality. And money is surely an important part of it.
Reliance Endowment Plan gives you just the financial independence to realise your
dreams in the future. It lets you decide how much you would like to set as your Sum
Assured based on your current financial position and your expected future expenses.
So, go ahead... dream!!.
Key Features
1 .On maturity receive Sum Assured plus bonuses
2. Wealth creation through bonus additions
3. More Value for your money by way of High Sum Assured Rebate
4. Choose to add the Benefit of three Riders-Reliance Term Life Insurance Benefit Rider,
5. Reliance Critical Conditions Rider and Reliance Accidental Death and Total and
6.Permanent Disablement Rider
7. Choose to avail of Policy Loan after three years

CASH FLOW PLAN

While most insurance plans block your money for a certain period of time, Reliance
Cash Flow Plan gives you the double benefit of life insurance along with easy liquidity
through lump sum cash. It provides money periodically when you need it.
It lets you live life to the fullest today and at the same time, helps you stay protected for
tomorrow by giving you the flexibility of receiving a specified percentage of the Sum
Assured at specified intervals
Key Features
Easy Liquidity - Get periodic cash flows at the end of the fourth year and thereafter at the
end of every three years
Wealth creation through bonus additions
On maturity, accumulated bonuses along lump sum payout receive with final
34
More value for your money by way of High Sum Assured Rebate
Full Sum Assured plus bonuses in case of your unfortunate death. This is
over and above the Survival Benefits already paid
Option to add two Riders - Critical Illness Rider & Accidental Death Benefit and Total
and Permanent Diablement Rider.

RELIANCE HEALTH + WEALTH PLAN

UNDER THIS PLAN THE INVESTMENT RISK IN THE INVESTMENT
PORTFOLIO IS BORNE BY THE POLICYHOLDER.
There are times when late working hours take precedence over your health check-ups.
And there are times when a visit to the doctor seems more important than dividends on
your shares. In the rat race to make money, we often forget to take care of ourselves.
We understand this predicament. Here is a plan that will ensure that your wealth keeps
increasing constantly and yet your health does not take a backseat. The Reliance
Wealth+Health Plan. A plan that gives you the benefits of wealth bhi. health bhi.
Life changes. And as it does, so do your priorities. After all, the circumstances of your
life can determine the type of health coverage you need.
India has made rapid strides in the health sector. Since Independence, life expectancy has
gone up markedly and survival rates have also increased, still critical health issues
remain. Infectious diseases continue to claim a large number of lives.
Perhaps you're a freshly minted graduate, a joyful newlywed, retiring early or between
jobs. Maybe you're running your own business or raising a family — or both. In any of
the situations, GOOD or BAD, health cannot be taken for granted. All are affected by the
rising costs of medical expenses. That’s why it is important to plan early and in advance.
Reliance Wealth + Health Plan, a health insurance plan underwritten by Reliance Life
Insurance Company Limited, is designed to work in conjunction with contributions
towards savings. The uniqueness of this plan is that it not only provides benefits for
covered injuries but also for other injuries by encashment from the unit fund. This plan
from Reliance Life offers the Hospitalization and Surgical Benefits and also covers
Critical Illnesses. In short this plan provides you with a personalised quality health cover
that fits your lifestyle.

35
Key Feature
A Unit Linked plan with Unique Savings Component
Twin benefit of market linked return and health protection
Choose from two different plan options
Flexibility to take care of your family’s health
Flexibility to switch between funds / plan options
Option to pay Top-ups
Option to package with multiple riders
Liquidity through partial withdrawals

RELIANCE SUPERINVESTASSURE PLAN

UNDER THIS PLAN THE INVESTMENT RISK IN THE INVESTMENT

PORTFOLIO IS BORNE BY THE POLICYHOLDER.
You have always aspired for the best in life. And we help you achieve that.
Here’s a unique plan which combines protection and savings. It also offers complete
flexibility to gain control over your investments vis-à-vis your financial needs and risk
appetite.
We value your regular investments and thus reward you with guaranteed additions thus
promising unmatched benefits. This plan also offers you a unique option of moving from
a conservative fund to an aggressive fund systematically, to take advantage of the Rupee
cost averaging model.
A plan that promises you, what you ought to deserve as you reach greater heights in life.
What more can you ask for except gifting yourself with Reliance Super InvestAssure
Plan
Key features – Reliance Super InvestAssure Plan
Twin benefit of market linked return and insurance protection.

36
Guaranteed additions at the rate of 50% of your first year’s basic premium at interval of
every 5 years from 10th year till policy is in force.
Investment opportunity with flexibility -Choose from 8 pure investment fund options.
Option to pay Top-up premium(s).
Liquidity in the form of partial withdrawals.
A host of optional rider benefits to enhance protection cover.

RELAINCE AUTOMATIC INVESTMENT PLAN

UNDER THIS PLAN THE INVESTMENT RISK IN THE INVESTMENT
PROTFOLIO IS BORNE BY THE POLICYHOLDER
Life is indeed delightful if you have the freedom to make choices. The Reliance
Automatic Investment Plan gives you just that ample freedom! And we make this
freedom more enjoyable by giving you a sense of security. Whether it’s your insurance or
investments, we let you make the choice and leave the rest to us.
So allow us to take over and you can be rest assured, because for us your LIFE comes
FIRST… always.
This plan promise enhanced Life Cover, with complete flexibility to gain control over
your investments in tune with your financial needs and your risk appetite.
A plan that promises you what you deserve as you reach greater heights in life.
For a select few like you, the Reliance Automatic Investment Plan is an enhanced Unit
Linked plan addressing comprehensive needs to strike that perfect balance of protection
and Savings with full flexibility as you grow in your career. The Reliance Automatic
Investment Plan gives you full flexibility to choose just the right investment mix to reap
higher benefits.

Key Features
Two plan option to choose from Ready-made and Tailor-made
Life Stage asset allocation to ensure automatic change in investment patterns, under the
Ready-made Plan option
Freedom to decide your own fund mix based on your risk profile under the Tailor-made
Plan
Allows Systematic Transfer Plan to average out the cost of unit purchased in equality
37
Regular, limited, single premium paying options
Unmatched flexibility through out ‘Exchange Option ‘
Liquidity in the form of partial withdrawal
Option to avail of Accidental Death and Total & Permanent Disability and Term
Insurance riders

RELAINCE TOTAL INVESTMENT PLAN SERIES -1

The journey of life, even though it may seem simple, comes with its own twists and
turns, some good, some unfortunate. And along with these moments come new dreams.
With every little twist, our dreams change and so do our ambitions. And most of all we
desire a security that will help us follow our dreams, both financial and emotional. It is
this security that Reliance Life Insurance Company Limited promises to bring to you
with its Total Investment Plan Series I Insurance.
To know more, read further…
We value your dreams in this journey of life. Reliance Total Investment Plan Series I
-Insurance (TIPS-I -Insurance) helps you bring them to reality. Your need for investment,
protection and financial liquidity keeps changing at different stages of life. The birth of a
child will require you to increase your insurance cover; a marriage in the family will
require additional money. We provide you that kind of flexibility which suits you best at
your convenience. Similarly on a promotion you may want to increase your investments
to create a large kitty for future expenses. As you progress on this ladder of life we
provide you the platform to increase your investment. Usually you would require
multiple financial products to meet all your needs and would have to actively manage
them. However with the Reliance TIPS-I -Insurance, Unit Linked Investment +
Insurance Plan you can meet all your financial needs, without the complexity of
managing multiple products

Key Features
This is a Single Premium unit linked savings life insurance plan with options to purchase
the same plan with reduced allocation charges in subsequent policy years. Since more
Premium is allocated towards investment due to lower allocation charges on subsequent
38
purchases, greater would be the returns. Purchasing the same plan in the subsequent
years is an option.
1st purchase would be called as “Classic”
2nd purchase would be called as “Silver”
3rd purchase would be called as “Gold”
4th purchase would be called as “Diamond”
5th purchase would be called as “Platinum”
Once you purchase the first policy there will full flexibility, as to when second and
subsequent purchase can be made and how much Premium should be paid for each
purchase subject to the following:
The minimum Premium on each purchase should be at least Rs. 25000 for life assured
aged up to 40 and Rs. 50000 for life assured aged 41 to 64.
The maturity date on each purchase cannot exceed 70 years.
All the polices should mature on maturity date of the first purchase.
The term of the polices purchased during second, third, fourth and fifth policy years will
be 9, 8, 7 and 6 respectively.
New policy can be purchased only if all the previous polices are in force on the date of
purchase of new policy.
Plan Objective :
The pace setter plan with protection to life which gives
Tax benefit under Sec. 80C and Sec. 10(10D)* of Income Tax Act 1961
Investment opportunity with flexibility
Life protection
Control over your investments

Reliance Life Insurance launches “Express Life”, India's First retail policy
initiative

First-of-its-kind initiative in the sector offering life insurance cover almost instantly to
customers
Customers will be offered policy document “Over the counter” on completion of
documentation, first “Express Life Policy” issued today

39
“Express Life” service will be available pan India across all Reliance Life Branch
Offices
Chandigarh, November 9, 2007: Reliance Life Insurance, one of the leading Life
Insurance player in India, today launched ‘Express Life’ – an innovative and customer
friendly service that assures fastest way of getting a life insurance cover.
With this, Reliance Life Insurance becomes the first Life Insurance player in the country
to offer this novel life insurance process to its customers for a cover of upto Rs 10 lakh..
This is the first of its kind initiative in the sector that would offer life insurance cover
almost instantly to customers, without the hassles of long waiting period, follow-ups and
medical checkups.

Speaking on the launch of Express Life, Mr. P. Nandagopal, CEO, Reliance Life
Insurance Company Limited, said, “This unique process will redefine the way insurance
is bought and sold in India. Express Life is a testimony of our constant endeavor to
delight our customers with innovative and need based solutions promptly”.

Customers who fall between the age group of 18 to 45 years and fulfill the qualification
criteria, can avail the benefits of, ‘Express Life’ service. It is customer friendly service
wherein on submission of the duly filled application form, mandatory documents and the
requisite premium cheque, customers are assured commencement of life insurance cover
in 3 working days. The letter & the policy kit are handed to the customer over the
counter.
The company also issued its first policy under the “Express Life” initiative to its first
customer in Chandigarh today. The Express Life service is available under the Reliance
Life Insurance Automatic Investment Plan, Money Guarantee Plan, Market Return Plan
and Golden Years Plan.

40
SALES PROCESS WHICH I USED IN
RELIANCE LIFE:

Our sales process involved Personal selling. Our product being an intangible
one, it needs the company personnel to go and persuade the customer via addressing to
his doubts and concerns. We need to undergo requisite interaction with the prospective
customers to gauge their mood with respect to different price levels. As the sales
personnel are also aware of the competitors’ price and, based on the market reaction and
customers’ sentiments, they can advise a more prudent price policy to the management.
The sales person actually stimulates and generates enough interest in the customer
and helps him make the final decision to buy the product.
Steps in personal selling
Personal selling involves six important steps –

Prospecting Preapproach Approach

Follow-up
Presentation Closing
Prospecting
Prospecting is the process of identifying the prospective buyers of the product. The
prospects are those who have the need or will to buy and the power to pay. A prospect is

41
qualified if he has the authority, need, ability and eligibility to buy. In our context
prospects used to be the owners in case of a small company and Promotions &
Advertising head in that of a big organization.

Ways of identifying a prospect

Acquaintance Reference: A satisfied customer can be a good source of information

about the names, addresses and phone numbers of the prospects who may be among his
acquaintances, relatives or family members. In addition we used to give reference of our
other satisfied customer to motivate the prospect to buy, thus obtaining further
references.

Cold Calling: In this method we used to randomly call a customer without any
reference, with an anticipation of converting the call into sale. This method is also called
‘random prospecting’.
Centre of Influence Method: Using this approach, we obtained the references for
prospects from eminent people of society. Using such references, the prospects are
influenced to make a buying decision since the recommendations of eminent
personalities are taken seriously.

Direct Mail or Telephone Method: This was the most frequently used method by us.
We used to contact the prospective buyer on the telephone and inform him about our
product, price range, benefits etc. We also used to send mail/letters to our existing
customers informing them about modifications made in the existing range.

Company’s Record: We were provided contacts of the prospective customers from

company’s own records. We need to follow up with them and get appointments and make
sales therefore.
42
Pre – Approach
Pre – Approach is the second step in the selling process which emphasizes that
salesman should know, after identifying the prospects in the prospecting stage, the
prospect’s likes and dislikes, his needs, preferences, habits, nature, behavior, economic
and social status etc. Based on all this information, the salesman has the necessary tools
to plan his visit/interview with the prospect and can give an effective sales presentation.
This kind of preparation to meet the prospect is called the pre – approach.
Because of pre-approach we gained ample knowledge about the prospect. This helped us
in giving the presentation more efficiently, effectively and with confidence.

Approaching
In this stage the prospect and the salesman come in contact with each other face to
face. Here the salesman has the opportunity to understand and interact with the prospect
in a better way. Hence, the salesman should put forward his best efforts to make the best
use of this opportunity in getting the attention of the prospect and to convince him to buy
the product.
Hence, getting the attention of the prospect and persuading him to buy are the two
main objectives of a salesman. The importance of the approach cannot be
overemphasized since it is only after the salesman starts interacting directly with the
prospect that the latter decides within the first few minutes whether he needs to purchase
or not. Similarly, the salesman has the opportunity to judge whether the prospect is in the
mood to buy or not.

43
 We generally found it very difficult to approach the prospects owing to their busy
schedule. Also sometimes they are not interested in proposal. Despite this major hurdle
we kept on trying to obtain an appointment with the prospect. We need to be a little
diplomatic and polite in our approach.
Different ways in which we gained access to the prospects:

Direct approach: We used to directly approach the prospect without any introduction
whatsoever and conduct an interview. We stated the benefits of our product and tried to
arouse interest of the prospect.

Advance Mailer: Another manner in which we used to seek an appointment with a

prospect was by sending an advance mailer explaining our product and its benefits vis - a
- vis our competitors. Such mailers were designed and written in a simple but attractive
manner so as to arouse the interest of the prospect.

Reference: This is the best method of securing an appointment with the prospect.
References could be obtained from friend, relative, or business associate of the prospect.
This not only facilitated the interview but also made the task of selling the product easier.

Sale letters: These proved to be another kind of a door opener. Such letters provide
ample detail about the product, benefits and schemes available with the product. Such
letters signed by senior executives, when sent in advance, facilitated our entry.
A successful approach enhances the sale and it is thus important for running of a
business. A failed approach on the other hand gives an opportunity to the rival company.
So a good approach goes a long way in building good relations with the prospect, while a
bad one causes to lose the business & facilitates competitor’s entry.

Presentation
A good presentation is as important as a good product. The significance of a good
presentation of the product can be gauged from the fact that many a time an attractively
packed presentation is sufficient to sell the product.

44
Requirements of a good presentation:
We were required to explain the product with its features and price advantage to the
customer in simple and easy terms. We ought to have thorough knowledge about our
product and also other competitive products available in the market. This helps in
satisfying all the queries of the customers and answers them satisfactorily.
It is very important that customer be shown the kind of product he is looking for. This
way not only his time is saved but also he tends to make a quick decision.

The Close
This is the last stage of any sales presentation. The whole exercise becomes useless
if the sale does not take place. Therefore it’s most crucial stage for any salesman. The
main aim of the close is to convince the prospect to sign the contract form immediately
rather than in future.
For successfully closing the sale we needed to be attentive and open mind
throughout so as to be able to listen patiently to the prospect, face objections and
confidently answer any queries of them.

45
Distribution Channels in Life Insurance

Life insurance is always sold and seldom bought

Tied Agency force nearly 11 lakh agents with LIC
Constraints in terms of area, reach, resources which
inhibit growth of business
A multiple distribution channels supplementary to
existing channel
Bancassurance
Corporate Agents
Brokers
Direct Marketing
Net Marketing
Telemarketing etc

46
SOME GENERAL INFORMATION ABOUT LIFE
INSURANCE IN INDIA:

 Life Insurance Sector in India 

Significant channel for 
household savings into capital 
formation

GDP penetration  2nd largest 
of 4.1%  financial service   
in India after 
Life Insurance
Statutory  Total number of 
requirements to  lives insured and 
provide  reach   on books as on 
to rural areas March 31, 2008­  
Total Assets Under Management 
of Life Insurance Cos. as on 
March 31, 2008­ Rs. 8,50,000 

47
HUGE POTENTIAL TO CATCH UP IN INDIA

48
Per capita premium remains very low at Rs 1,408 indicating huge untapped potential
McKinsey projects penetration to increase to between 5.1% - 6.2% of GDP by 2012

Demographic profile to witness favourable trends

• Proportion of working age group to gradually increase to 68%

49
 • Dependency ratio to fall from current level of 62% to 54% by 2011
• Improving old age group mortality trend-Composition to double to 8.2%
– increasing need for innovative annuity products

India's projected demographic profile
Population 
profile (m) 2001 2005 2006 2011 2016 2021 2026
Under 15 363 368 360 351 343 337 328
15­65 622 673 702 780 854 916 967
65 and over 42 51 52 66 78 94 115
Total 1,027 1,092 1,114 1,197 1,275 1,347 1,410

Composition
Under 15 35.3% 33.7% 32.3% 29.3% 26.9% 25.0% 23.3%
15­65 60.6% 61.6% 63.0% 65.2% 67.0% 68.0% 68.5%
65 and over 4.1% 4.7% 4.7% 5.5% 6.1% 7.0% 8.2%
Total 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Dependencyratio 65.1% 62.3% 58.7% 53.5% 49.3% 47.1% 45.9%

PRODUCT MIX

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 New Business Index by Product m ix

100%
11% 12%
6% 4%
80%

40%
60%
64%

40%

20% 43%

19%
0%
Apr-06 to Mar-07 Apr-07 to Sep-07

Non-Linked Individual Life Linked Individual Life Group A nnuity P ension Health

 Unit-linked products introduced for the first time in 2002. Sale of unit linked
products increased to 64% in first half of 2007-08 from nil in 1999-00
 Pension accumulation products promoted in a big way and gaining large market
share from near 0% share in 1999-00
 Health products being introduced by life insurers

ROLE IN BHARAT NIRMAN

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• Supplementing Government in social protection measures

• Huge distribution presence right across India

o Significant channel of household savings to capital markets

• Increasing number of foreign JVs

o Infusion of foreign capital and technology

• Obligation to be present in Rural and Social sectors

o Extension of micro insurance on the back of microfinance

• Substantial funds raised with long term horizon

o Large long term investment in capital markets – projected $20bn infusion

in 2008-09
o Ideal provider of funds to Infrastructure – Approx $25bn invested already

• Creation of Jobs

o Direct employment to 200,000

o Advisor force of 1.6 mn

o Indirect employment through brokers, corporate agents etc.

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CUSTOMER FOCUS…

• Competitive environment with the entry of private players

o Spread of customer centricity

o Availability of more product lines – ULIP in particular

o Spread of term insurance culture

o Increased use of local language in transactions

o Focus on reaching out to customers in their neighbourhood

• Product innovation

o Increasing importance of OTC products

o Customised solutions to cater to lifestage needs

o Flexible payment options

o Riders - critical illness, hospital cash etc

o Health products – covering specific illnesses

• Spread of equity culture

o Education of “Asset allocation” concept

o Large scale participation in equity – share in India growth story

o Use of Alternative Channels like Banks and Corporate agents

o Increased accessibility

o Use of technology

o Web-based customer service tools

o Faster turn around times for complaint resolution

o Enablement of real time fund switching options

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 o ULIP – the game changer

o Complete insurance package – with insurance, wealth management, asset

allocation, saving for specific need
o Competitive investment product for the long-term

o Flexibility and transparency packed in

o Catering to varied risk appetites with a range of fund and switch options.

CHALLENGES…IN LIFE INSURANCE

• Training to large sales force

o Increased focus on need-based selling

o Persistency - Product

o Depends upon need-based selling and long-term focus

o Need to develop easier payment options

• Persistency – Sales Force

o Large part-time sales force

• Reaching the masses

o Micro insurance is yet to become popular

o Life insurance is yet to be accepted as an investment tool

• Rising cost of insurance operations – distribution, salary and occupancy

costs
• Regulatory - higher solvency margins, service tax on ULIP – increasing cost
for consumer

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 BIBLIOGRAPHY

1. BOOKS/MAGAZINES REFFERED:

 STUDY GUIDE- PRINCILES & PRACTICES OF LIFE /

GENERALINSURANCE, by AIMA.

BOOKS PUBLISHED BY INSURANCE INSTITUTE OF INDIA

 SALES MANEGEMENT BY S.L.GUPTA

 LIFE-INSURANCE, by Mc GILL

 INSURANCEWATCH.

 MONEYOUTLOOK.

2. WEBSITES REFFERED:

 WWW.RELIANCELIFE.CO.IN

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 WWW.CIFAINSURANCE.COM

WWW.MONEYOUTLOOK.COM

WWW.INSURANCE.IND.COM
 WWW.IRDA.COM

3. REPORTS/ARTICLES REFFERED:

REPORT: ISSUES & CHALLENGES FACING THE INSURANCE

INDUSTRY…. Dec2005.

BRIEF PROFILE OF LIC, INDIA…Dec 2006.

REPORT: COPING WITH COMPETITION…Jan2007

56