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Project Report On
RELIANCE LIFE INSURANCE COMPANY LIMITED
Partial fulfillment of the requirements of two years full time Master of Business Management (MBA)
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Preface--------------------------------------------------- (3) Certificate------------------------------------------------ (4) Acknowledgement-------------------------------------- (5) Executive Summary------------------------------------- (6) Index----------------------------------------------------- (7)
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Anil Dhirubhai Ambani Group (ADAG) announces the acquisition of 100 percent shareholding in AMP Sanmar Life Insurance Company Limited. Reliance Life Insurance Company Limited is officially launched on February 1, 2006. This was after obtaining the required regulatiry approvals from the Registrar of Companies and the Insurance Regulatory and Development Authority. Reliance Life Insurance is the part of the Reliance Capital. Reliance Life Insurance has plenty of plans on the anvil. It has also 118 branches, with strong presence in South and a bouquet of products catering savings protection and investment need of individuals and corporate. The head-office of it is at Chennai. The company has already added 600 employees in addition to the 1000 plus staff of the erstwhile AMP Sanmar Life Insurance Company Limited. Reliance Life Insurance aims to be the consumer’s preferred life insurer by understanding and meeting his needs. Think Bigger, Think Better!
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CHAPTER SUBJECT NO. 1 INSURANCE INDUSTRY 1.1 Meaning of Insurance 1.2 Importance of Insurance 1.3 Difference between Insurance and Assurance 1.4 Principles of Insurance 1.5 History of Insurance 1.6 Time line in Insurance history 1.7 Meaning of Life Insurance 1.8 History of Life Insurance 1.9 Key features of Life Insurance 1.10 Benefits of Life Insurance 1.11 Role of Life Insurance in the growth of economy 2 INTRODUCTION TO THE COMPANY 2.1 About Reliance Life Insurance 2.2 History 2.3 Journey so far 2.4 Role of IT at Reliance Life Insurance 2.5 Mission 2.6 Core Values 2.7 Future Plans 2.8 Head – Office 2.9 Branches 3 PRODUCT MIX 3.1 Traditional Plans 3.2 Unit linked Plans 4 HUMAN RESOURCE MANAGEMENT 4.1 Recruitment 4.2 Selection 4.3 Training and Development 4.4 Career Development 4.5 Communication 4.6 Incentives 4.7 Services 4.8 Performance Appraisal 4.9 Organizational form and Structure 4.10 Department
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MARKETING DEPARTMENT 5.1 Distribution Channel 5.2 Promotional Programmes and Target segment 5.3 Comparative Study RESEARCH METHODOLOGY 6.1 Objective of the study 6.2 Questionnaire 6.3 Sampling Method and Sampling Size 6.4 Limitations 6.5 Analysis of Questionnaire 6.6 SWOT Analysis FINANCE DEPARTMENT CONLUSION BIBLIOGRAPHY AND REFRENCES APPENDIX
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Projects, Thesis, Dissertation – projectsparadise.com
CHAPTER-1 INSURANCE INDUSTRY
1.1 MEANING OF INSURANCE
Projects, Thesis, Dissertation – projectsparadise.com
Insurance is a collective bearing of risk. Insurance can be defined as a “legal contract between two parties whereby one party called insurer undertakes to pay a fixed amount of money on the happening of a particular event. Thesis. Dissertation – projectsparadise. It provides financial compensation for the losses suffered due to the happening of any unforeseen events. 1. as people prefer small fixed liability instead of big uncertain and changing liability. Insurance is desired to safeguard oneself and one’s family against possible losses on account of risks and perils. Insurance is a financial device to spread the risks and losses of few people among a large number of people.” The other party called insured pays in exchange a fixed sum known as premium.2 IMPORTANCE OF INSURANCE Projects.Insurance may be described as a social device to reduce or eliminate risk of loss to life and property. which may be certain or uncertain.com 7 .
The scope of the study of insurance industry of India would be very great as there are ongoing developments in the industry after the opening of the sector. Insurance services play predominant role in the process of financial intermediary. Rural marketing of insurance. The major issue right now is the hike in FDI (Foreign Direct Investment) limit from 26% to 49% in the insurance sector. insurance brokers’ regulation. Another major issue is the effects on LIC after the entry of private players in the market.com 8 . There are many issues. incentive scheme of development officers of LIC etc. new distribution channels. There is lot of potential in the Indian Insurance Industry. which require study. Right now the insurance industry has great opportunities in a country like India or China which huge population. new product ranges. Though market share of LIC has been affected. So it offers lot of scope for studying the insurance industry. Dissertation – projectsparadise. Also the penetration of insurance in Projects.Insurance constitutes one of the major segments of the financial market. Today insurance industry is one of the most growing sectors in India. it has improved in terms of efficiency. This would lead to more capital inflow by foreign partners. Thesis. There are number of other hot topics like penetration of Health Insurance. Government may in near future allow 49% FDI in Insurance.
The word assurance indicated certainty. In life insurance. So first we understand what is insurance? How the word ‘insurance’ is different from the word ‘assurance’? etc. fire. we have to start with the basics of insurance. etc. Projects. On the other hand the word insurance was used to denote indemnity type of insurances where the insurance company was liable to pay only in case of the loss damage the property. Thesis. 1.com 9 . there is an assurance from the insurance company to make payment under the policy either on the maturity or at earlier death. the term assurance came to be used only for the risks covered by life insurance and the term insurance was exclusively used to denote the risks covered by marine. Before starting the discussion on insurance industry and related issues. Dissertation – projectsparadise. From 1826.India is very low in both life and non-life segment so there is lot potential to be tapped. The insured event was bound to happen sooner or later under assurance but the event insured against may or may not happen under insurance.3 DIFFERENCE BEETWEN INSURANCE AND ASSURANCE Assurance is older in history and it was used to describe all types of insurances.
In other words. The scope of the word.4 PRINCIPLES OF INSURANCE An insurance contract is based on some basic principles of insurance. (3) Principle of subrogation This means the insurer has the right to stand in the place of the insured after settlement of claims in so far as the insured’s right of recovery from an alternative source is involved. Both the parties should disclose all material information regarding the subject matter of insurance. In other words. he shall be fully indemnified only to the extent of loss.The principle of “indemnity” applies to “insurance contracts”(non-life) only. the insurer is entitled to recover from a negligent third party any loss payments made to the 10 Projects. (2) Principle of indemnity This means that if the insured suffers a loss against which the policy has been made. Thesis. insurance is wider. (1) Principle of “Uberrima Fides” or Principle of utmost good faith It means “maximum truth”. Dissertation – projectsparadise. 1.com . The insurer before the settlement of the claim may exercise the right. the insured is not entitled to make a profit on his loss.
The concept of ‘Third Party Claims’ is based on the same principle.5 HISTORY OF INSURANCE Projects. (4) Principle of causa proxima The cause of loss must be direct and an insured one in order to claim of compensation.com 11 . (5) Principle of insurable interest The assured must have insurance interest in the life or property insured. The purposes of subrogation are to hold the negligent person responsible for the loss and prevent the insured from collecting twice for the same loss. Dissertation – projectsparadise. Insurable interest is that interest which considerably alters the position of the assured in the event of loss taking place and if the event does not take placed. 1. Thesis.insured. he remains in the same old position.
These companies were empowered to write fire and life insurance as well as marine. the name of Life Insurance Corporation of India’s corporate headquarters. is found in the Rig Veda. The Aryans practiced some form of ‘community insurance’ around 1000 BC. The insurance Projects. The concept of insurance as we know today took shape in 1688 at a place called Lloyd’s Coffee House in London where risk bearers used to meet to transact business. Dissertation – projectsparadise. The Great Fire of London in 1966 caused huge loss of property and life. With a view to providing fire insurance facilities. Thesis. This coffee house became so popular that Lloyd’s became the one of the first modern insurance companies by the end of the eighteenth century. Dr. Life insurance in its modern form came to India from England in 1818.The concept of insurance is believed to have emerged almost 4500 years ago in the ancient land of Babylonia where traders used to bear risk of the carvan by giving loans. Nicholas Barbon set up in 1967 the first fire insurance company known as the Fire office. The Sanskrit term ‘Yogakshema’ (meaning well being). The Oriental Life Insurance Company was the first insurance company to be set up in India to help the widows of European community. which were later repaid with interest when the goods arrived safely.com 12 . The early history of insurance in India can be traced back to the Vedas. Marine insurance companies came into existence by the end of the eighteenth century.
Insurance business flourished and so did scams. expenditure and management of these companies. By the mid.com . Thesis. The nationalization of life insurance was followed by general insurance in 1972. 1. Dissertation – projectsparadise. the first comprehensive legislation governing both life and non-life branches of insurance were enacted to provide strict state control over insurance business. treated Indian lives as subnormal and charged an extra premium of 15 to 20 per cent. 1938. 16 foreign insurers. The first Indian insurance company. the Bombay Mutual Life Assurance Society. The Insurance Act. This amended insurance Act looked into investments.companies. As a result the government decided to nationalize the life assurance business in India. The Life Insurance Corporation of India (LIC) was set up in 1956.1950s there were 154 Indian insurers. came into existence in 1870 to cover Indian lives at normal rates. which came into existence between 1818 and 1869. irregularities and dubious investment practices by scores of companies.6 TIME LINE IN INSURANCE HISTORY (MAJOR LANDMARKS) 1818 British introduced the life insurance to India with the 13 Projects. and 75 provident societies carrying on life insurance business in India.
1870 1912 1938 The Insurance Act was enacted. The Indian Life Assurance Company Act enacted to regulate the life insurance business. 1956 1972 1993 Malhotra committee was constituted under the chairmanship of former RBI chief R. in Calcutta. 1994 Projects. 1850 Non life insurance started with Triton Insurance Company. Malhotra committee recommended reentry of private players. Government took over 245 Indian and foreign insurers and provident societies. General Insurance Corporation (GIC) came into being. Thesis. Malhotra to draw a blue print for insurance sector reforms.establishment of the Oriental Life Insurance Company .com 14 . Dissertation – projectsparadise. N. Nationalization took place. Bombay Mutual Life Assurance Society is the first India owned life insurer. Non-life business nationalized.
1.7 MEANING OF LIFE INSURANCE There are three parties in a life insurance transaction: the insurer. and the owner of the policy (policyholder). insurers start setting non-life claims in the cashless mode. HDFC were first private players to sell insurance Policies. Dissertation – projectsparadise. ICICI Prudential.1997 IRDA (Insurance Regulatory and Development Authority) was set up as a regulator of the insurance market in India. Thesis. Royal Sundaram was the first non-life private player to sell an insurance policy. although the owner and Projects.com 15 . the insured. 2001 2002 Bank allowed to sell insurance plans as TPAs enter the scene. 2000 IRDA started giving license to private insurers.
The policy does not accumulate cash value. • Term life insurance provides for life insurance coverage for a specified term of years for a specified premium. unless the owner fails to pay the premium when due. Premiums increase the cash account. and mortality and expense charges will not reduce the cash value shown in the policy. The primary advantages of whole life are guaranteed death benefits. fixed and known annual premiums.com 16 . Projects. Thesis. Life insurance may be divided into two basic classes – term and permanent. guaranteed cash values. Dissertation – projectsparadise. • Universal life insurance (UL) is a relatively new insurance product intended to provide permanent insurance coverage with greater flexibility in premium payment and the potential for a higher internal rate of return. The beneficiary is the person or persons who will receive the policy proceeds upon the death of the insured. A universal life policy includes a cash account. • Permanent life insurance is life insurance that remains in force until the policy matures. buy a term life insurance policy. If you want insurance protection only. and a cash value table included in the policy guaranteed by the company. Another important person involved in a life insurance policy is the beneficiary. and not a savings and investment product.the insured are often the same person. • Whole life insurance provides for a level premium.
8 HISTORY OF LIFE INSURANCE Risk protection has been a primary goal of humans and institutions throughout history. cargo. ship owners were the insured and lenders were the underwriters. nearly 4. In 2100 BC. and a surcharge to cover the possibility of loss. 1.com 17 . Piracy. or freight. Protecting against risk is what insurance is all about. that as a way of spreading the risk. In another part of the world. insurance was seen as a preventative measure against piracy on the sea. a number of ships would carry a portion of another ship's cargo so that if one ship was captured.500 years ago.If you want to buy a whole life. was so prevalent. Projects. Check the National Association of Insurance Commissioners website (www. Thesis. Over 5000 years ago. traders used to bear risk of the caravan trade by giving loans that had to be later repaid with interest when the goods arrived safely. in the ancient land of Babylonia. plan to hold it for at least 15 years. It formalized concepts of “bottomry” referring to vessel bottoms and “respondentia” referring to cargo. These provided the underpinning for marine insurance contracts. universal life. Canceling these policies after only a few years can more than double your life insurance costs. Dissertation – projectsparadise.org/cis) or your local library for information on the financial soundness of insurance companies. Such contracts contained three elements: a loan on the vessel. in China. or other cash value policy. in fact. the entire shipment would not be lost. In effect.naic. an interest rate. the Code of Hammurabi granted legal status to the practice.
death.. Lloyd's Coffee Projects. Thesis. or as they were known then. particularly with merchant and artisan guilds. most of the concepts of insurance were abandoned. and insurance would again reemerge. life insurance in England was vigorously promoted in the three decades following the Glorious Revolution of 1688. transportation. The type of insurance we see today owes it's roots to 17th century England.com 18 . and to protect widows and children. Modern Insurance Illegal almost everywhere else in Europe. With Rome's fall. burial societies were formed in the Buddhist period to help families build houses. During the feudal period. For instance. but aspects of it did continue through the Middle Ages. These provided forms of member insurance covering risks like fire. where burial clubs were formed to cover the funeral expenses of its members. Lloyd's of London. as well as help survivors monetarily. the name of Life Insurance Corporation of India's corporate headquarters. is derived from the Rig Veda. around 450 A.D. theft. But during the 14th to 16th centuries.Life insurance came about a little later in ancient Rome. flood. Insurance in India can be traced back to the Vedas. And similar to ancient Rome. commerce. The term suggests that a form of "community insurance" was prevalent around 1000 BC and practiced by the Aryans. Dissertation – projectsparadise. and even imprisonment. early forms of insurance ebbed with the decline of travel and long-distance trade. disability. yogakshema.
Massachusetts became the first state to require companies by law to maintain such reserves. ship owners and underwriters met to discuss and transact business deals. 79 merchant underwriters broke away in 1769 and two years later formed a “New Lloyd’s Coffee House” that became known as the “real Lloyd’s. And the first life insurance policy for the general public in the United States was issued. that when newspapers published names of prominent people who were seriously ill. in fact. The Presbyterian Synod of Philadelphia in 1759. SC. The key to its success was reducing the opposition from religious groups. Two years later. Insurance moves to America The U. Thesis. on May 22. life insurance also appealed strongly to the gambling instincts of England's burgeoning middle class. bets were placed at Lloyd’s on their anticipated dates of death. While serving as a means of risk-avoidance. But it wasn't until 80 years later (after 1840). was the location where merchants.S. that life insurance really took off in a big way.com 19 .” Making wagers on people's deaths ceased in 1774 when parliament forbade the practice. insurance industry was built on the British model. The Projects. 1761.House. Gambling was so rampant. sponsored the first life insurance corporation in America for the benefit of ministers and their dependents. The year 1735 saw the birth of the first insurance company in the American colonies in Charleston. the infamous New York fire drew people's attention to the need to provide for sudden and large losses. Reacting against such practices. in Philadelphia. In 1835. Dissertation – projectsparadise.
Even today. public liability insurance. wherein the risks are spread among several companies. membersonly insurance. Thesis. but sickness and accident benefits and old-age pensions. The practice of reinsurance. many societies were founded to insure the life and health of their members. from a farming country to an Projects. land diversity and the overwhelming desire to be independent. gained importance and acceptance? More advancement was made to insurance during the process of industrialization. which made it mandatory for a company to insure its employees against industrial accidents.great Chicago fire of 1871 further emphasized how fires can cause huge losses in densely populated modern cities. such fraternal orders continue to provide insurance coverage to members. which first made its appearance in the 1880s. providing not just life insurance. the US market developed somewhat differently from that of the United Kingdom. Final Thoughts Even though the American insurance industry was greatly influenced by Britain. As America moved from a colonial outpost to an independent force.com 20 . as do most labor organizations. Dissertation – projectsparadise. In 1897. while fraternal orders provided low-cost. Employees contribute a certain percentage of the premium for these policies. With the creation of the automobile. Many employers sponsor group insurance policies for their employees. Contributing to that was America's size. the British government passed the Workmen's Compensation Act. During the 19th century. was devised specifically for such situations.
com 21 . 1. 2) Assignment: If your intention is that your policy monies should go only to a particular person. 3) Death Benefit: The primary feature of a life insurance policy is the death benefit it provides. Insurance became more sophisticated. Permanent policies provide a death benefit that is guaranteed for the life of the insured. 4) Cash Value: - Projects. as the policyholder you continue to be the owner of the policy and the nominee does not have any right under the policy so long as you are alive. offering new types of coverage and diversified services for an increasingly complex country. the insurance business developed from a small number of companies to a large industry. you need to assign the policy in favor of that person. Dissertation – projectsparadise.9 KEY FEATURES OF LIFE INSURANCE 1) Nomination: When one makes a nomination. provided the premiums have been paid and the policy has not been surrendered. The nominee has only the right to receive the policy monies in case of your death within the term of the policy.industrial nation. Thesis.
Dissertation – projectsparadise. It equals the amount a policy owner would receive. called paid-up additions. individuals often purchase term life insurance. If one owns a term policy. sometimes a provision is available that will allow her to convert her policy to a permanent one without providing additional proof of insurability. This feature allows the policy owner an easily accessible loan in times of need or opportunity. if the policy were surrendered before the insured's death. after any applicable surrender charges. 8) Conversion from Term to Permanent: When in need of temporary protection.The cash value of a permanent life insurance policy is accumulated throughout the life of the policy. Either a fixed or variable rate of interest is charged. 9) Disability Waiver of Premium Projects.com 22 . Thesis. 5) Dividends: Many life insurance companies issue life insurance policies that entitle the policy owner to share in the company's divisible surplus. 7) Policy Loans: Some life insurance policies allow a policy owner to apply for a loan against the value of their policy. one of which is toward the purchase of additional coverage. 6) Paid-Up Additions: Dividends paid to a policy owner of a participating policy can be used in numerous ways.
Dissertation – projectsparadise. It guarantees that coverage will stay in force and continue to grow 1.10 BENEFITS OF LIFE INSURANCE 1) Risk cover: Life Insurance contracts allow an individual to have a risk cover against any unfortunate event of the future. 2) Tax Deduction: Under section 80C of the Income Tax Act of 1961 one can get tax deduction on premiums up to one lakh rupees. Projects.Waiver of Premium is an option or benefit that can be attached to a life insurance policy at an additional cost.com 23 . Thesis. Life Insurance policies thus decrease the total taxable income of an individual.
11 ROLE OF LIFE INSURANCE GROWTH OF THE ECONOMY IN THE The Life Insurance Industry has an enviable track record among public sector units. Thesis. 4) Retirement Planning: What had provided protection against the financial consequences of premature death may now be used to help them enjoy their retirement years.com 24 . Dissertation – projectsparadise. The industry is recognized as one of the largest financial Institutions in the country. Moreover the cash value can be used as an additional income in the old age. 1. Through investments in the Government sector and socially.3) Loans: An individual can easily access loans from different financial institutions by pledging his insurance policies. 5) Educational Needs: Similar to retirement planning the cash values that flow from ones life insurance schemes can be utilized for educational needs of the insurer or his children. Projects. It has a Consistent profit and dividend paying record accompanied by a steady growth in its financial resources.oriented sectors the Industry has contributed immensely to the nation's development. The ventures initiated by the industry in the areas of Mutual Fund.
the reinsurance arrangement are so organized that maximum retention is made possible within the country while at the same time protecting interests of the policy holders. CHAPTER-2 INTRODUCTION TO THE COMPANY Projects. To protect the country's foreign exchange reserves. Thesis. Dissertation – projectsparadise.com 25 .Housing Finance has done exceedingly well in recent years.
Reliance Capital is one of India’s leading private sector financial services companies.Anil Dhirubhai Ambani Group.1 ABOUT RELIANCE LIFE INSURANCE Reliance Life Insurance Company Limited is a part of Reliance Capital Ltd.com 26 .2. of the Reliance . in terms Projects. Thesis. and ranks among the top 3 private sector financial services and banking companies. Dissertation – projectsparadise.
2006. 1934. Thesis. 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. Dissertation – projectsparadise. 2. This was after obtaining the required regulatory approvals from the Registrar Of Companies and the Insurance Regulatory and Development Authority. It was in August 2005 that the ball was set rolling when Reliance Capital Limited. stock broking.com .of net worth. private equity and other activities in financial services.2 HISTORY Reliance Capital Limited announced the launch of its life insurance business on February 1. life and general insurance. Reliance Life Insurance is another steps forward for Reliance Capital Limited to offer need based Life Insurance solutions to individuals and Corporate. proprietary investments. Reliance Capital has interests in asset management and mutual funds. 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. the financial arm of Reliance – Anil Dhirubhai Ambani Group 27 Projects.
com 28 . Dissertation – projectsparadise. 2006 January 17: ‘Optimising Mr.3 JOURNEY SO FAR… 2005 August: Co Ltd. Thesis.(ADAG) – announced the requisition of 100% shareholding in AMP Sanmar Life Insurance Company Limited. All the existing policy contracts also stand transferred to the Reliance Life Insurance entity with all the original contractual terms and commitments intact. The company will issue all policy contracts under the Reliance Life Insurance Company limited name. 2. and the formal transfer of shares took place in October 2005. Nandgopal participates in a one-day conference on growth opportunities through Distribution Matrix: Anil Dhirubhai Ambani Group (ADAG) announces the acquisition of 100 percent shareholding in AMP Sanmar Life Insurance Projects.
Nandgopal. Amongst those who participate are the CEO. March 7: The new office at Chennai. KV Srinivasan and Mr.com 29 . Amitabh Jhunjhunwala. Thesis. 4th Floor. 2. # 39. Functional Heads. February 26: A Puja held at the Churchgate office situated in Express Building. at the Trapezium. Sureshbabu also graced the occasion. March 1: Churchgate office inaugurated by Mr. with fail-over capability to their Chennai Data Centre Projects. Mumbai. Regional Managers and Regional Sales Managers. Mr. COO. March 6: Shifting to the new premises at Churchgate commences. Nelson Manickam Road. Mr. Nandgopal. Mumbai. Dissertation – projectsparadise. Amitabh Chaturvedi and Mr. inaugurated by their CEO Mr.4 ROLE OF INSURANCE IT AT RELIANCE LIFE 1) World Class Data Centre: They plan to establish a Primary Data Centre at Navi Mumbai (Dhirubhai Ambani Knowledge City) which will cater to their company needs across India. 14 ‘E’ Road. First Floor. February 16. 17. 18: Strategy meet at the Reliance Management Institute. February 1: Rliance Life Insurance officially launched.‘Emerging Bancassurance’ organized by the Asia Insurance Post at the Taj President.
Dissertation – projectsparadise. Life-Asia and Internet Applications. 4) Web Portal: This portal will be an interface between both internal employees and their external users. 2) Inter Office Connectivity: All their Branch / Area and Regional offices will be interconnected to their Data Centre with a 24x7 access to Core Applications like Lotus Mail. Under Writing Medical System. Some of the functions included in their portal are Policy Tracking Systems. Corporate News. 3) Customer Care Centre: They will host a centralized Customer Care Centre at Dhirubhai Ambani Knowledge City at Navi Mumbai. which cater services to internal and external queries and complications. A customer Relationship Management Tool (CRM) and Lead Management System (LMS) are in progress. and Agent Management System etc. 5) R World: 30 Projects. This will enable their associates to work faster and better with high-speed Internet connectivity and also ensure faster Turn Around Time for their customers.within the same business day in occurance if an incident or Disaster happens.com . Thesis. Quality Checking System.
Policy Dispatch Details. 9) Document Management System: Projects. Agents/Advisors and Lead Generators. Products.Reliance Mobile R-World will provide online information about their Company.com 31 . 8) Advisor Lounge: It is a dedicated area for Reliance Life Insurance Agents/Advisors in all the branches across India. This Lounge will be equipped with desktops and printers with Internet connectivity. where their Advisors can bring in the prospects and can have discussions across the table and they can create and print quotes. 6) SMS Alerts: SMS Alerts will be provided to their Sales Managers about the latest happenings like Contests and Campaigns. Employee Alerts will include Company News and Welcome/Birthday/Anniversary message etc. Dissertation – projectsparadise. Thesis. Customer Alerts will include Welcome/Birthday/Anniversary message. and Policy Services to their existing customers. Policy Servicing SMS like Premium Receipt and Renewal Premium reminders etc. The Agents/Advisors can use this area to service their existing customers. 7) Life and Group Asia: Single Life and Group Life details will be captured and managed by Life and Group Asia. A common middleware between these applications will enable Group Life Customers to view their individual Single Life Insurance Plan details taken with Reliance Life Insurance and vice versa.
11) SAP – ERP Modules: SAP (Finance and HR Modules).5 MISSION The mission of Reliance Life Insurance Company Limited is to be the best in every sphere. which yields a faster Turn around Time to both internal and external users. will automate the Expense. This application will enable them to have a paperless office and thus mitigate the risk of losing vital records/papers.business results. Dissertation – projectsparadise. customer care and employee focus.6 CORE VALUES Reliance Life Insurance Company Limited has some core values which are listed as follows: Projects.com 32 . Thesis. 2. 10) Wireless Data Access: This will enable identified Top Sales Managers and Top Advisors to access real time data for both LMS and CRM on the fly through Handheld PDA device. The aim of the company is to Think Bigger and Think Better.DMS will enable both policy issuance and contract servicing through an automated workflow. Travel and Leave Management Systems. 2.
who may be both prospective and existing clientele and from channel partners in Chennai and Mumbai. Dissertation – projectsparadise.8 HEAD – OFFICE Projects. 2. and a pan India presence with 162 branches in the coming year.7 FUTURE PLANS Forty-four new branches to be opened across the country in the coming months. A state-of-the-art customer care centre will provide continuous. responsive services to the caller and promptly address queries. Thesis.1) Result Oriented 2) Performance Driven 3) Customer Focused 4) Learning and Development Oriented 5) Employee Centric 6) Informal and Fun 2.com 33 . collate feedback and suggestions from the caller. It will be launching additional products aimed at providing unparalleled service to its valued clientele.
Reliance Life Insurance Company Limited. And they have planned to open more branches across the country in the coming months. Thesis. Nelson Manickam Road. 39. First Floor. Dissertation – projectsparadise. Projects.com 34 .9 BRANCHES They have so many branches and substations in the India. They have around 160 branches in the India. The Trapezium. Chennai – 600 029. 2.
CHAPTER – 3 PRODUCT MIX Projects. Dissertation – projectsparadise.com 35 . Thesis.
com .1 TRADITIONAL PLAN:Life insurance products are designed to suit the requirements of customers. Fundamentally the product provide for: Risk cover Investment Health cover 36 Projects. Dissertation – projectsparadise. Thesis.3.
In every product. which are listed as follows: 1) Reliance Term Plan 2) Reliance Whole Life Plan 3) Reliance Child Plan 4) Reliance Endowment Plan 5) Reliance Special Endowment Plan 6) Reliance Cash Flow Plan 7) Reliance Credit Guardian Plan 8) Reliance Special Credit Guardian Plan Each of the above traditional plans is discussed as follows: 1) Reliance Term plan: This insurance policy is designed for those who only want life cover for the protection of their family. It can also be useful to business firms that wish to provide financial security to their business against the sudden loss of partners or valuable manpower. Thesis. it is essential for an agent to understand the requirements of the customer well. and do not wish to save for themselves. Reliance Life Insurance Company Limited has offered 9 traditional plans to the customers. In order to suggest the right product. Since Projects. the premiums are calculated and the customer pays accordingly. risk cover is imperative for it to fall under the category of insurance. Based on the coverage of the product. to a certain degree. Dissertation – projectsparadise.com 37 .
Features: a) It is a whole life insurance policy with profits b) Low cost life cover c) Maturity age is 85 year or 99 years last birthday as chosen d) Maturity amount = Sum assured + Vested bonus e) Tax benefit is available Projects.there is no saving element or bonus provision. Dissertation – projectsparadise. e) Maturity amount = Sum assured 2) Reliance Whole Life Plan: This insurance policy is designed for people who do not wish to avail of any benefits themselves but wish to create an immediate estate to protect their family by availing of insurance cover on their life at a very low cost. this is a high-risk plan with a low premium. Features: a) Purely a term plan b) Entry age minimum 18 years and maximum 65 year c) Maximum premium paying term is 30 year d) Loan facility N. Hence.A. the premium is very low.com 38 . Thesis.
com 39 . Thesis.3) Reliance Child Plan: This insurance policy is designed for people who wish to save money for a future time when there will be a recurring need for substantial amounts of money. This money is payable in equal installments over the last 4 years of the policy term. b) Minimum premium paying term is 5 year and maximum 20 year c) Tax benefit is available d) Maturity amount = Four equal installment of sum insured in last four year plus vested bonus in the last year e) Loan facility is available 4) Reliance Endowment Plan: - Projects. or is perhaps planning to go abroad. Minimum entry age is 20 year and maximum 60 year a) Minimum sum assured is Rs. Features: I. Dissertation – projectsparadise.000. a Doctor or specialize in some other field. This is especially true when it comes to paying large sums of money for higher education as and when your son or daughter is studying to become an Engineer. 25.
your daughter’s wedding. your child’s university education or even a new office for your business . Features: a) Entry age minimum is 5 year and maximum 65 year b) Maturity age minimum is 18 year and maximum 75 year c) Minimum premium paying term is 5 year and maximum 35 year in case of regular and in case of single 15 year Projects.Reliance Life Insurance’s Reliance Endowment Plan is the key to all your financial needs.com 40 . Reliance Endowment Plan also gives you the additional benefit of participating in the company’s profits. which you will receive at the end of the policy period. your family or your business. It is an inexpensive and easy way to protect you. In the event of your untimely death. Thesis. In a nutshell this plan will keep you financially prepared for all the special occasions in your life . Reliance Endowment Plan will also assist your loved ones through this difficult time by the financial support that it provides. Dissertation – projectsparadise.by eliminating the burden that a shortage of money creates.
are characteristics of the policy. Features: a) Entry age minimum 12 year and maximum 65 year b) Minimum sum assured is Rs. This plan also participates in the profits.com 41 .000 or as determined by the minimum premium e) Maximum sum assured is Rs. Thesis.000 c) Minimum premium paying term is 10 year and maximum 40 year Projects. quarterly and monthly (by salary deduction only) g) Loan up to 90% of the surrender value of the policy h) Maturity amount = Guaranteed sum assured + Reversionary bonus 5) Reliance Special Endowment Plan: This insurance policy is designed for people who wish to combine savings with extended security. 25. 5.000 (entry age below 18 years and no limit for entry age 18 and above) f) Premium mode annual. The unique feature of this policy is that life protection continues for five years after you have stopped the payment of premium.d) Minimum sum assured is Rs.00. 25. Dissertation – projectsparadise. half yearly. Payment of sum assured at the end of premium paying term and extension of life cover thereafter for the full sum assured for a period of 5 years.
The advantage of the policy is that they need not part with a sizable amount of money at any one time.com 42 . while providing simultaneously. Thesis. substantial life cover. through regular premium payments. The money is payable in installments. The first installment is paid at the end of the 4th year and thereafter at the end of every 3rd year. and renovation of your home or perhaps.d) Unique feature of this policy is that five year life protection continues after you have stopped the payment of premium e) Tax benefit is available f) Under this policy bonus is compounded yearly g) Loan facility is available h) Maturity amount = Full sum assured before maturity date + Vested bonus at the time of maturity date 6) Reliance Cash Flow Plan: This insurance policy is designed for those who have a recurring need for reinvestment in business or look for short-term investment channels. your daughter's engagement. a holiday abroad. Dissertation – projectsparadise. but create. Features:a) Plan with profits b) Minimum entry age is 15 year and maximum is 63 year Projects. it can be used to meet any immediate financial crisis in the family like your son's college admission. Alternatively. a periodic return of lump sums which become available for reinvestment at higher returns.
c) Maximum premium paying term is 34 year d) Loan facility is not available e) In case of death full sum assured + accrued bonuses up to the date of death is payable immediately f) In case of survival up to maturity date all premium paid g) Rider accident death and critical illness h) Mode of payment is available 7) Reliance Credit Guardian Plan: This insurance policy is designed for those who not only safeguards individuals but also families and businesses from the financial hardship that could arise from unfortunate and unexpected death. Features: a) Loan protection against home. Thesis. two wheelers and four wheelers b) In case of death remaining loan amount paid immediately c) In case of survival no benefit is available d) Premium payment option for single and regular is available e) Premium paying term is 2/3 of loan period and remaining period paid by the company 8) Reliance Special Credit Guardian Plan: Projects. home improvement. Dissertation – projectsparadise.com 43 .
com 44 . home improvement.2 UNIT LINKED PLAN A unit-linked policy is a life assurance policy in which the benefits depend on the performance of a portfolio of shares. Projects.This insurance policy is designed for those who not only safeguards individuals but also families and businesses from the financial hardship that could arise from unfortunate and unexpected death. Thesis. two wheelers and four wheelers b) In case of death remaining loan amount paid immediately c) In case of survival no benefit is available d) Premium payment option for regular and single is available e) Premium payment term is 2/3 of loan period and remaining period paid by the company f) Maturity amount = All the premium paid amount g) Tax benefit is available 3. Features: a) Loan protection against home. Dissertation – projectsparadise. disability or critical illnesses.
) is used to buy units in a unit trust. a small investor can benefit from investment in a managed fund without making a large financial commitment. In this way. expenses. while the balance (after the deduction of costs. Legal heirs are entitled to the amount of insurance cover and entitled units in case of death of the insured. Policyholders can surrender the policy at any time and the surrender value is the selling price of the units purchased by the date of cancellation 9less expense). which are listed as follows: 1) Reliance Market Return Plan 2) Reliance Golden Years Plan Amongst the above plans the Reliance Market Return Plan is the largest selling plan of the Reliance Life Insurance Company Limited. The above two ULIP plans are discussed as follows: 1) Reliance Market Return Plan: Reliance Market Return Fund is the unit-linked product that helps you invest in the financial markets in a combination of investment instruments of your Projects.Each premium paid by the insured person is split: a part is used to provide life assurance cover. A small part of the contribution is used for providing life cover and the balance is invested in unit. Reliance Life Insurance Company Limited has also offered the two Unit Linked Plans. Dissertation – projectsparadise.com 45 . etc. As they are linked to the value of shares. Thesis. unit linked policies can go up or down in value.
2500 (standing order/credit card) d) Top up premium minimum Rs. half yearly and monthly Rs. ii. Thesis. quarterly. Features: a) Minimum entry age is 30 days and maximum entry age is 65 year b) Maximum policy term 40 year and minimum policy term 5 year c) Mode of premium as annual.com 46 . 1000 (for salary deduction only) and Rs.choice. Capital secure 100% fixed interest securities Balanced minimum 80% fixed interest securities and maximum 20% in equity Equity 100% equity Growth minimum 60% fixed interest securities and maximum 40% in equity f) Loan facility is not available g) One switches every year free and subsequent switches charged 1% of the amount switched Projects. 2500 e) Option of investment fund i. iv. Reliance Market Return Fund unit-linked insurance plan provides you with a basket of fund options that balances your return and risk exposure while providing life cover at the same time. iii. At the same time your investment premiums provide you with insurance cover. You can enjoy the returns from the markets without the trouble of monitoring and managing your own investment portfolio and keeping track of the market movements. Dissertation – projectsparadise.
Contributions provide Income tax savings as well.. Reliance Golden Years Plan is a flexible package that provides freedom of choice in choosing the type of investment.h) Partial withdrawals per year under regular and single premium options is 2 times i) Lock in period till today is 3 year j) Minimum unit account balance after each withdrawals is Rs. life cover. 10. Reliance Golden Years Plan. Features: a) Entry age minimum is 18 year and maximum 65 year b) Minimum premium amount Rs. 10. Thesis. vesting options such as commuting and annuity options.000 2) Reliance Golden Years Plan: Reliance Golden Years Plan…. Dissertation – projectsparadise. a flexible pension product is available for all individuals who are between the ages of 18 and 65. The Reliance Life Insurance ‘no-worry stay happy’retirementplan.000 and maximum is unlimited c) Mode of premium payment is available d) Pension plan with risk cover and without risk cover e) Choice of investment Projects.com 47 .
i. ii. ii. Annuity payable for life Annuity payable for 5/10/15 years certain and thereafter with life Annuity payable for life with return of capital on death of the annuitant CHAPTER – 4 HUMAN RESOURCE MANAGEMENT Projects. iii. Capital secure fund – 80% in equity and 20% in government security Balanced fund – 80% in government and 20% in equity f) No loan facility is available g) Tax benefit is available h) Annuity options i. Thesis. Dissertation – projectsparadise.com 48 .
Projects. The result is a pool of applicants from which new employees are selected. Dissertation – projectsparadise.4. The process begins when new recruits are sought and ends when their applications are submitted.com 49 .1 RECRUITMENT Recruitment is the process of finding and attracting capable applicants for employment. Thesis.
Dissertation – projectsparadise. Mumbai.2 SELECTION Selection is the process of picking individuals (out of the pool of job applications) with requisite qualifications and competence to fill job in the organization. the validity the license would be 3 years.S. Projects.In this company the Sales Manager. examination. They must pass the prerecruitment examination.C. In simple words. After all these requirements. 4. or any other approved examination body. it is the process of differentiating between applicants in order to identify these with a greater likelihood of success in a job. After clearing the examination the code will be provided to them and the license will also be given to them. does the recruitment. Thesis. The Branch Manager. the person will become an insurance advisor in the company.com 50 . The advisors should have at least passed the S. which includes-. who recruits the advisors/agents for selling the products of the company. will conduct the process of selection of Sales Manager 1) Personal Interview: The first step of selection of Sales Manager in the Reliance Life Insurance Company Limited is to conduct a personal interview of an applicant by the Branch Manager. which is conducted by the Insurance Institute of India.
2) Project 40 Interview: After clearing the personal interview. the applicant should be interviewed by the Regional Head. 6) Selection: After clearing all the above steps the applicant should be appointed/selected as a Sales Manager in the company. 5) Medical Examination: After that. Thesis. the project 40 interview will be taken by the Branch Manager.com 51 . the applicant should have to make a list of 40 and then start the business with them. Dissertation – projectsparadise. 4) Negotiation: After clearing the interview with Regional Head. who will check his/her performance. 3) Interview with Regional Head: After clearing the project 40 interview. the negotiation will be provided to the applicant. the medical check up should e made to the applicant. In this step. Projects.
Their job profile includes recruitment. The age of them should be between 25 to 35 years. Manager should possess the 4. 5.B. 4. motivating and in turn getting business out of a team. They should have the capability to handle the team.com 52 . training. computed as follows: Projects.A. Thesis. 2. They should have good communication skill. guiding. They should be an M. They should have at least sales experience of 3 years. 3.Requirements of Sales Manager:The Sales following things1. The need for training and development is determined by the employee’s performance deficiency. 6.3 TRAINING AND DEVELOPMENT:Training and Development is any attempt to improve current or future employee performance by increasing an employee’s ability to perform through learning usually by changing the employee’s attitude or increasing his/her skills and knowledge. Dissertation – projectsparadise.
They are also providing the product training to their advisors and Sales Managers. The communication is provided in the following manner: Projects. Dissertation – projectsparadise. This institute is approved by IDRA to train agents/advisors. who are newly recruited.5 COMMUNICATION Communication is the process through which an individual can exchange their beliefs. The NIS SPARTA Institute has more than 150 batches and is trained over 3000 agents for most of the private insurance companies. 4. Thesis. which enabling free interaction between all levels. information. things. it is the process of exchanging the information from one person to another.com 53 . and experience to others. which will identify potential and create avenues for growth. who are newly recruited. They are providing an open environment. In simple words. 4. The 100 hours training is to be conducted at Net Bios Computer Academy whereas the product training is to be conducted at NIS SPARTA.Training & Development = Standard Performance – Actual Performance They are providing 100 hours training to their advisors.4 CAREER DEVELOPMENT They are also providing career development plans.
com 54 .Projects. Thesis. Dissertation – projectsparadise.
BRANCH BRANCH BRANCH REGIONAL REGIONAL REGIONAL CHANNEL HEAD CMO CEO Projects. Dissertation – projectsparadise. Thesis.com 55 .
which includes employees. 2) They are planned team building and fun events. Thesis. associates and their families. 1) They are providing knowledge sharing and certification practices. then to Chief Executive Officer (CEO).6 INCENTIVES Incentives are monetary benefits paid to workmen in recognition of their outstanding performance. Projects. 4.7 SERVICES They are offering following certain services to their employees. They are providing an aggressive reward and recognition plans. 4. 3) They are creating Reliance Life Insurance family. then to Chief Marketing Officer (CMO). then Regional Head to Channel Head. which are including sales incentives. Within a branch.com 56 .Explanations of the diagram:The communication is flow between Branch to Branch. Dissertation – projectsparadise. and then Branch Head to Regional Head. then different Regional Head to Regional Head. it flows between Branch Manager to Sales Managers and Sales Managers to Agents/Advisors.
customer focused. Dissertation – projectsparadise. which goals and measure financial. the Branch Manager should measure the performance of the Sales Managers at every six months and the Sales Manager should measure the performance of the advisors/agents.8 PERFORMANCE APPRAISAL Performance appraisal is the systematic evaluation of the individual with respect to his/her performance on the job and his/her potential for development. process related and employee development related initiatives. achievement oriented and challenge loving performance. organization and society all benefit. If the performance is best then he/she will be prompted. They are providing a balanced scorecard approach for strategy deployment and performance measurement. structured system of measuring and evaluating an employee’s job related behaviors and outcomes to discover how and why the employee is presently performing on the job and how the employee can perform more effectively in the future so that the employee.com 57 . Projects. Thesis. Performance appraisal is a formal. In addition to this. 4.4) Reliance Life Insurance in a team building mode and is looking for performance driven.
Dissertation – projectsparadise.9 ORGANIZATION STRUCTURE CEO CMO Channel Head Regional Head Branch Head SalesCEO Manager Advisors/Agents Customers FORM AND 4.10 DEPARTMENT They are providing following areas or departments: 1) Retail Sales 2) Under Writing 3) Actuarial 4) Insurance Operations 5) Customer Service 6) Quality and Processes 7) Human Resources 58 Projects. Thesis.4.com .
Thesis.8) Finance CHAPTER – 5 MARKETING DEPARTMENT Projects.com 59 . Dissertation – projectsparadise.
5.1 DISTRIBUTION CHANNEL Reliance Life Insurance Company Limited is using five types of distribution channel. they had increased buying power. This channel works as follows: Branch Managers Advisors Customers Projects. Thesis. Although producer groups are in their infancy. The one type of distribution channel. which are as follows: 1) Agency: Independent insurance agents represent a number of companies and can research these companies’ products to find the right combination for their clients. Ltd is using. Independent shops realized that by pooling production and funding a central support office. is an agency.com 60 . Dissertation – projectsparadise. Independent agents & insurance producer groups are growing in prevalence. which Reliance Life Insurance Co. their emergence may potentially be realignment in the distribution of financial services.
Banks are failing to incorporate successful sales tactics used to sell other financial services like investments.com 61 . followed by demand for corporate trustee services. In this channel the advisors using or targeting the bank customers to make a business with them i. Through these small enterprises. to sell the policy of the company.2) Bank Assurance: While a lot of bank relationships with insurance companies have been established. a research was performed with independent advisors across several broker/dealers and custodians.. Dissertation – projectsparadise. This channel is tie up with corporate or small enterprises. Another type of distribution channel is corporate. Thesis. which are for employee benefits. the advisors will sell the products/policy to customers of the small enterprises. life insurance sales have been slower than one would expect he primary bank insurance activities have been the distribution of annuities. 3) Corporate:To gain a better understanding of the demand amongst independent advisors for trust services and to gain a better feel for how independent advisors handle trust services.e. credit life. and direct marketing insurance. This channel is tie up with banks. Another type of distribution channel is bank assurance. The interviews revealed that demand is greatest for living trusts among independent advisors. Projects.
These firms have steadily captured assets. 5) Web World:Direct sales of life insurance are growing rapidly.4) Rural Benefits:Brokerage firms have gained much of the institutional and personal trust business lost by the banks. Web sites are starting to pop up offering consumer insurance products especially designed for distribution over the web. Projects. Across all financial services. This channel works as a dealership. Another type of distribution channel is rural benefits.com 62 . primarily at the expense of the banks. This channel is tie up with customer database. Insurance companies view full-service brokers as a potentially new distribution channel as well. but many of the traditional full-serve players seem to be letting it go. the dealers will sell the policy to the target customers. Dissertation – projectsparadise. In this channel. In this channel. The number of non-bank trust companies has increased in recent years as independent trust companies have emerged and more broker/dealers are integrated services. consumers are expressing a willingness to deal with a variety of providers on the web. which are taken from the customer database. are listed in the website. Thesis. Another type of distribution channel is web world. the advisors will sell the policy to the target customers.
The promotional programmes are made to motivate the advisors/agents and sales managers to do more business i.. Dissertation – projectsparadise. to sell the more policies. Thesis. The Reliance Life Insurance Co. which are as follows: 1) Shubh – Arambh:This promotional scheme is detailed as follows: SLAB (WRP) ACHIEVERS REWARD Projects.e.2 PROMOTIONAL TARGET SEGMENT PROGRAMMES & Promotional programmes and target segment are related to each other.5.com 63 . Ltd has made three promotional schemes.
00.:The full form of R.19L DVD/VCD/MP3 Player Sony Music System LG Refrigerators GL-233 LG Air Conditioner 1T Sony Digital Camcorder Trip to Dubai 3D/4N Hero Honda Splender Maruti Alto Std.G.E.000 10.A. is Reliance Advisor’s Reward Experience. Thesis.000 SUPER ACHIEVERS 5. New Advisor Incentive Program 2.E.000 75.30.00.00.000 20.00.000 Login: 1st April to 31st May ‘06 Issuance till 15th June ‘06 Reliance Life T-Shirt Table Top Clock Leather Bag World Space Radio L.000 50.000 15.000 1.000 1.000 3.000 1.00.00.00. Dissertation – projectsparadise.00. This programs consists of 1.00. Microwave.000 75.000 STAR ACHIEVERS 50.50.R.000 2. Maruti Swift Lxi GM Aveo 1.4LS 2) R.000 7.00.A. Board of Advisors Projects.com 64 .00.50.R.
Parameters 3. Program Board of Advisors:Criteria There will be two levels in the Board of Advisors program A. Time Period B. R.E. Take Off 2. Program Discovery Series:Criteria There will be six levels in the Discovery Series program A. Dissertation – projectsparadise. Program New Advisor Incentives:Criteria There will be two levels in the New Advisor Incentive program A.3. Annual Discovery Series 4. Qualification period B. Business criteria Projects. RARE Club – Loyalty Program The above programs are described as follows 1. Advisor Career Progression 5. Thesis. R.R. Launch Pad B.A.R.com 65 .R.A.A.E.E. R.
The qualification criteria will be the same for both the Global and the National Discovery Series D. Program Advisor Career Progression:Advisor Career Progression A. The qualification period is I. Sales Manager 5. Product Mix C. The RARE Club will have 6 different levels B. The criteria for entry into each level will be based on I.com .A.C. Thesis. Business Associate B. Privilege Club:Levels A.R. Logins from 1st Apr ’06 to 31st Mar ‘07 II. Qualification for the Global Discovery Series E. R.R.E.A.E. Persistency III. Business (WRP) II. The top 150 will bb calculated based on WRP (Weighted Recd Premium) 4. Issuances from 1st Apr ’06 to 15th Apr ‘07 Qualification Criteria 66 Projects. Dissertation – projectsparadise. R. Qualification for the National Discovery Series F.
5. Thesis.000 10. There is only one public sector company LIC and the rest 14 are private sector.000 5. Dissertation – projectsparadise.00.com 67 .Level Topaz Pearl Sapphire Emerald Ruby Diamond WRP (Rs) 1.00. who have login the regular premium of Rs.000 25.000 50.000 will be eligible for the Elite Club Membership. Although LIC has been dominating the Life Insurance business since past few years the private players have now started to take the momentum.000 Traditional Products 60% 60% 60% 50% 50% 50% Persistency 80% 80% 80% 85% 85% 85% 3) Elite Club Scheme:In this scheme the advisor. 00.00. 2.50.000 15.00. Projects.00.3 COMPARATIVE STUDY Presently there are 15 Life insurance companies in the country.
The company was registered on 23/10/2000. Dissertation – projectsparadise. The company was registered on 24/11/2000. It is a private sector company.com 68 .89%. The market share for FY 2005-06 was 7.35%.44%. It is a private sector company. The market share for FY 2005-06 was 2. Being the first to be established LIC is the forerunner in the Life Insurance sector. Life Insurance Corporation of India (LIC): Life Insurance Corporation of India is a 100% government held Public Sector Company.1) Major Market Players: - Birla Sun Life Insurance Company: Birla Sun Life Insurance Company is a 74:26 joint venture between Birla group and Sun Life Financial. ICICI Prudential Life Insurance: ICICI Prudential Life is a 74:26 joint venture between ICICI and Prudential. The company was registered on 31/1/2001. Kotak Mahindra OLD Mutual: - Projects. Thesis. It is a private sector company. HDFC – Standard: HDFC standard is a 74:26 joint venture between HDFC and Standard Life. The market share for FY 200506 was 1.87%. The market share for FY 2005-06 was 71.
11%. Thesis. The company was registered on 2/8/2001. The market share for FY 2005-06 is 0.com 69 . The company was registered on 6/8/2001. Enam (9. The market share for FY 2005-06 was 1.Kotak Mahindra OLD Mutual is a 74:26 joint venture between Kotak Mahindra bank and Old Mutual. It is a private sector company.23%. It is a private sector company. It is a private sector company. Dissertation – projectsparadise.14%. Met Life India: - Projects. The market share for FY 2005-06 was 1. It is a private sector company. ING Vysya Life insurance: ING Vysya Life Insurance is joint venture between Exide (50%).87%). Gujarat Cements (14. The company was registered on 10/1/2001.13%) and ING (26 %).79%. The market share for FY 2005-06 was 1. Max New York Life: Max New York Life is a 74:26 joint venture between J & Bank. Pallonji & Co and MetLife. The company was registered on 14/5/2002. Aviva Life Insurance India: Aviva Life insurance is a 74:26 joint venture between Aviva and Dabur.
The market share for FY 2005-06 was 0.40%.It is a private sector company. The market share for FY 2005-06 was 1. The company was registered on 3/8/2001. It is a private sector company. Thesis. The TATA AIG Group: TATA AIG group is a 74:26 JV between Tata Group and AIG. The company was registered on 31/3/2001. SBI Life Insurance Company Ltd: SBI Life Insurance Company is a 74: 26 Joint venture between SBI and Cardiff S. It belongs to the private sector. The company was registered on 12/2/2001. The market share for FY 2005-06 was 2. Bajaj Allianz Life Insurance Co.: - Projects.29%.A.31%. Pallonji & Co and MetLife. Sahara India Life Insurance Company Ltd. Dissertation – projectsparadise.: Bajaj Allianz Life Insurance Company is a 74: 26 Joint venture between Bajaj Auto limited and Allianz AIG.Met Life India is a 74:26 joint venture between 74:26 JV between J & Bank.com 70 . The market share for FY 2005-06 was 7. The company was registered on 6/8/2001.56%.
06 %. Shriram life insurance company Ltd: Shriram Life is a recent entrant into the life insurance sector It is a 74:26 joint venture between the Shriram group through its Shriram Financial Holdings and Sanlam Life Insurance Limited.56 7. South Africa.First Wholly Indian Owned Private Life Insurance Company. No 1 2 3 4 Insurer LIC Bajaj Allianz ICICI Prudential HDFC Standard Market Share (%) 71. The Company commenced operations from 30th October 2004. Thesis. 2) Market Share: - Sr. The company expects to start operations soon.35 2.87 71 Projects. Dissertation – projectsparadise. The market share for FY 2005-06 was 0.44 7.com .
Thesis.com 72 .06 0. Dissertation – projectsparadise.11 0.29 1.14 1.4 0.03 Now let’s depict the market share of these players on diagram Projects.5 6 7 8 9 10 11 12 13 14 15 SBI Life Birla SunLife Tata AIG Max New York Aviva Kotak Mahindra OLD Mutual ING Vysya Reliance Life MetLife Sahara Life Shriram Life 2.79 0.31 1.23 1.89 1.54 0.
Its market share was approximately 98% before 2000 but after the entry of private players it has significantly decreased.1LIC Market Share(%) 2 B ajaj A llianz 3 ICICI P rudential 4 HDFC Standard 5 SB I Life 6 B irla SunLife 7 Tata A IG 8 M ax New Yo rk 9 A viva 1 Ko tak M ahindra OLD 0 M utual 1 ING Vysya 1 1 Reliance Life 2 1 M etLife 3 1 Sahara Life 4 1 Shriram Life 5 Here we can see from the diagram that LIC is the market leader and it commands the major part of the total life insurance market. Rest of the players has market share below 2%. ICICI Prudential is also one of the fastest growing life insurance companies in India. It has the market share of approximately 7.com .56% in the total market and it constitutes 40% of the market share among private players. Dissertation – projectsparadise. 73 Projects. HDFC Standard comes third. SBI Life insurance Company Limited comes fourth. Among private players Bajaj Allianz stands first. Thesis.
Thesis. Dissertation – projectsparadise.3) Capital Fund: - Capital Fund of Private Companies ( Rs in Crore ) ICICI Prudential Max New York HDFC Standard Bajaj Allianz Tata AIG Birla Sun Life AVIVA OM Kotak Reliance Life SBI Life Met Life ING Vysya 375 250 218 200 183 180 155 153 126 125 110 110 Projects.com 74 .
Dissertation – projectsparadise. Thesis.com 75 .CHAPTER – 6 RESEARCH METHODOLOGY Projects.
1 OBJECTIVES OF STUDY 1) To get some good market exposure by dealing with the prospects face to face. Projects. Dissertation – projectsparadise.6.com 76 . Thesis. 2) To improve our ability to sell a financial product like life insurance.
which provide answers that are easier to interpret and tabulate. 5) To get some information about the market share of Reliance Life Insurance as compared to the giants like LIC and to know the standing of the company in the market. which are arranged in a logical order. I have used open-end questions so that customers can write answer in their own words. I have also used closed-end questions. Closed end question include all the possible answers and subjects matters choices among them.2 QUESTIONNAIRE It is most common instrument whether administered in person by phone or online questionnaires are very flexible. I have used simple. I have asked personal questions at last so that respondent does not become defensive.com 77 . direct. 6. The form of each question is also important.3) To know the perception of the consumer about life insurance. Dissertation – projectsparadise. Thesis. 4) To get a deep knowledge of the financial product like insurance. I have taken care in the wording and ordering of questions. unbiased wording questions. Projects.
Thesis.com 78 . I have gathered secondary data and primary data and collected information from the combination of these two data. Primary data: Projects. I have tried to know their performance i. different magazines. I have asked personal questions at last so that they do not become defensive. private or public need different types of information are to know its popularity. 6.3 SAMPLING METHOD AND SAMPLE SIZE Introduction:Any organization whether big or small. whether they want to invest.Questionnaire of the customer I have made questionnaire consisting seventeen questions to get customer’s view about life insurance. I have gathered secondary data from website of different operators. newspapers and libraries. Dissertation – projectsparadise. Secondary data: Secondary data consist of information that already exists somewhere. where thy want to invest. having been collected for another purpose. up to what amount and since when.e.
I have visited them personally to get data. 6. current and unbiased. Sample size: I have taken sample size of 50 respondents. Projects. Thesis. The following are the limitation of this research study.I have taken great care while collecting primary data to answer that it is relevant. I have taken a sample of 50 people.com 79 . Dissertation – projectsparadise. so there is some limitation of the human hangs which is reflected in this research.4 LIMITATIONS I am a human hang. Because the population is too large so it is difficult to survey. accurate.
What is people’s major motive behind investing in life insurance? Do they decide upon their own or they take guidance of an agent? What is their perception about Reliance Life Insurance Company Limited? Projects. 4) One of the most influencing and most critical limitations is that I am not trained for the research study and this is my first study. but there is lack of expertise. 2) The opinion expressed by the respondents may be biased.5 ANALYSIS OF QUESTIONNAIRE Here I have formed a questionnaire to study why people go for life insurance. I tried hard to come at conclusion. But in spite of their limitation I worked with the enthusiasm. Dissertation – projectsparadise. as the sample size is too small for total population of Ahmedabad city. 3) The attitude of the research might be biased. 6. If I give more time then studies will be more effective. And I tried to give the best results to the research of this report.1) The sample size of 50 might not represent the perception of whole population. There are some limitations of this study. Thesis. 5) Another limitation is that there is lack of time.com 80 .
Engineers. Professors. Q. Advocates. Thesis. Target Population:I had conducted this survey among 50 people. Out of these 7 questions.com 81 .Questions:There are 7 questions in the questionnaire. and the target group was a mix of people from the society. Professionals.1 What is your main motive behind investing in life insurance? (a) Tax Benefit (b) Savings (c) Risk Cover (d) Return/Yield Projects. Analysis:I have used pie charts. I asked the questions to Doctors. and some other statistical measures to analyze the questions. Dissertation – projectsparadise. and general public. 6 questions are close ended and one question is an open ended one.
The main purpose of life insurance is the Risk cover of one’s life. Some believe that life insurance is an investment so they tend to invest in life insurance. 20 5 23 2 50 There could be any motive of people behind investing in a life insurance policy. But some people consider different advantages of a life insurance policy.com 82 . While some people believe that it is a compulsory saving. Some people consider Tax benefit as the main advantage of life insurance. Thesis. Now let’s see what all people say TAX SAVING RISK COVERAGE RETURN/YIELD Projects.MOTIVE TAX SAVING RISK COVERAGE RETURN/YIELD TOTAL NO. Dissertation – projectsparadise.
As the private players have launched ULIPs. Thesis. Dissertation – projectsparadise. Q. If we take a larger sample.Here we can see that majority of the people tend to invest in life insurance for the risk coverage. we can get a different result. According to a life insurance expert (Vinod Thakkar ). Also the number of those people who wish to invest for return is also increasing. But this is the general conclusion of 50 people. We founded from the discussion with public and some experts that those people with a low income tend to invest in life insurance to gain tax benefit.2 Rank the above motives according to your preference MOTIVE OF INVESTMENT TAX BENEFIT SAVINGS RISK COVER RETURN/YIELD Preference 1 2 3 4 21 19 8 2 3 11 25 11 24 16 7 3 1 4 10 35 Projects. The next preferred option is Tax Saving.com 83 . Return comes last. more and more people are turning towards these products so the Investment motive has been gaining command. Saving motive constitutes very small part of the total sample. life insurance is for protection first then for Savings and Tax benefits all those things.
3 How do you decide about investing in life insurance? (a) On my own (b) family decision (c) Employer decides (d) as per the guidance of agent This is a very crucial question as most of the people are not much familiar about different life insurance plans offered by different life insurance Pr ef er Projects.40 35 30 25 20 15 10 5 0 ce 1 2 3 en 4 TAX BENEFIT SAVINGS RISK COVER RETURN/YIELD We can see from the table and the graph that the number one motive of people about investing in life insurance is risk coverage. Q. Thesis.com 84 . This shows that still people consider other financial tools more viable for return and life insurance is for Tax benefit and risk cover. which is the main theme of life insurance followed by Tax benefit. The third position is of saving and fourth is Return. Dissertation – projectsparadise.
Here one hazardous factor is the moral hazard. Dissertation – projectsparadise. 29 7 0 14 50 ON MY OWN FAMILY DECISION EMPLOYER DECIDES AGENT GUIDANCE Here we can see that majority people (58%) decides on their about investing in life insurance. People tend to invest in life insurance plans to maintain relations though they are not in need of life insurance. Also sometimes it depends upon the convincing power of the agent. SOURCE ON MY OWN FAMILY DECISION EMPLOYER DECIDES AGENT GUIDANCE TOTAL NO.com 85 . Thesis. Projects. 28% persons decides as per the guidance of the agent. people would invest.companies so people take help of the life insurance agent and as he guides understanding the needs of the individual.
com 86 . which are relatively new entrant in the market. Now let’s find out what people have to say: Type of policy Term Assurance Whole Life Endowment Combined ULIPs TOTAL N0. 9 9 7 19 6 50 Projects. 14% people invest in life insurance as per the family decision. Q.4. The products range from pure Term Assurance Plans to Unit Linked Insurance Plans. Which life insurance policy would you prefer to buy? (a) Term Assurance (b) Whole Life (c) Endowment (d) Combination of Whole Life and Endowment (e) Unit Linked This is another crucial question as there are number of products offered by life insurance companies.There is no contribution of employers in the decision of one’s investment in life insurance. Dissertation – projectsparadise. We have already explained all these policies ahead. Thesis.
It gives people double advantage. and after that period the risk cover continues and the rest of the amount would be paid when the person dies.5 Would you prefer Reliance Life Insurance or LIC for buying the life insurance policy? (a) Reliance Life Insurance (b) LIC This is the most important question as it reflects the scope of the study.com 87 . Dissertation – projectsparadise. Projects.Term Assurance Whole Life Endowment Combined ULIPs As it is evident from the chart and the table 38% people prefer combination of Whole Life and Endowment product. for instance 20 years. Q. It is the main theme of this questionnaire. Thesis. The person would get some amount at the end of the stipulated period.
15 35 50 Reliance Life Insurance LIC As evident from the chart that 30% of people would prefer Reliance Life Insurance while 70% would prefer LIC. Dissertation – projectsparadise. Thesis. But after the entry of private players in 2000.com 88 . Reliance Life Insurance Company Limited is newly launched company. Projects.Prior to 2000 LIC was the only player in the life insurance market and it had the total market. Now let’s see what people say: Particulars Reliance Life Insurance LIC TOTAL No. So people had to go to LIC for buying life insurance policy. So it has fewer customers as compared to LIC. But the ULIP plans are sold more of Reliance life insurance as compared to LIC in today’s environment. some people have also turned to private life insurers.
Personal Details: 1) Age (a) 18 to 30 (b) 31 to 50 (c) 51 to 65 Age 18 to 30 31 to 50 51 to 65 TOTAL No. Thesis. Dissertation – projectsparadise. 5 30 15 50 Projects.com 89 .
Out of which 10% people are aged between 18 to 30.com 90 . Projects. 60% people are aged between 31 to 50. 2) Occupation (a) Service (b) Business (c) Profession (d) Housewife (e) Retired Occupation No.18 to 30 31 to 50 51 to 65 As evident from the chart that I have taken a sample of 50. Thesis. and remaining 30% people are aged between 51 to 65. Dissertation – projectsparadise.
00.000 to 1.000 Projects.000 to 5.00. Dissertation – projectsparadise.00.com 91 . 3) Income (a) 50. 30% are of business men.Service Business Profession Housewife Retired TOTAL 5 15 10 5 15 50 Service Business Profession Housewife Retired As the evident from the chart that out of 50 respondents 10% are of service men. Thesis. 10% are of housewives and remaining 30% are of retired.00. 20% are of professions.000 (c) More than 5.000 (b) 1.
000 1.000 to 5.000 1.000 to 1.000 and 30% are earning more than 5.00.com 92 .00. 50% are earning between 1. 50.00.000 to 5.000 TOTAL 50.00.00.00.00.00.000 to 1.Income (Per Annum) No.000 10 25 15 50 As the evident from the chart out of 50 respondents 20% are earning annually between 50.00.000 to 1.000. Dissertation – projectsparadise.00. Thesis.000 to 5.000 More than 5.00.00.000.000 More than 5. 4) Family members (a) 2 (b) 3 (c) 4 (d) More than 4 Projects.
Family Members No. 40% have 4 family members and remaining 20% have more than 4 family members. which have impact on the survival of any organization.com 93 . Now let’s make SWOT analysis for reliance Life Insurance Company Limited. 6. 30% have 3 family members. Dissertation – projectsparadise. Projects. Thesis.6 SWOT ANALYSIS SWOT analysis is the analysis of the internal and external factors. 2 3 4 More than 4 TOTAL 5 15 20 10 50 2 3 4 More than 4 As the evident from the chart out of 50 respondents 10% have 2 family members.
so people seems it risky. Led to an improvement in market securities. Dissertation – projectsparadise.☻STRENGTHS: 1) Reliance Life Insurance Company Limited is the part of the Reliance Capital. 5) Range of products 6) Reliance has a long and strong history of solvency.com 94 . 3) Private placement of Rs. 2) Lack of staff. ▼WEAKNESSES: 1) Newly established company.000 crs worth of securities with RBI by the government. financial stability. 10. 4) Strong liquidity from FII was the major reason for the up move. 2) The brand name is enough to sell the products easily. Thesis. Projects.
● THREATS: 1) The main threat is from the other players who have grabbed approximately 15% of the market share.com 95 . 2) Intention of traditional products is to encourage long term. regular and disciplined savings to systematically build up a target fund. Thesis.5%. So it has large potential. 3) The average insurance premium being collected by the company has been growing exponentially year on year. Dissertation – projectsparadise. so most of the customers are not aware of the Reliance Life Insurance. the people who used to invest in life insurance for the sole motive of tax benefit may turn to other instruments. 2) As the government has scrapped the rebate on the life insurance premium. The life insurance penetration in India is approximately 2.3) Lack of advertisement. ☼ OPPORTUNITY: 1) There is a vast untapped market in India. CHAPTER – 7 FINANCE DEPARTMENT Projects.
which are as follows: Projects. Thesis.com 96 .FUND PERFORMANCE:- There are four fund options. Dissertation – projectsparadise. which Reliance Life Insurance Company Limited has offered.
09% 3.60 6.1) Capital Secure Fund:This fund is for Reliance Golden Years Plan.-Mar.36% 1. Dissertation – projectsparadise. 61.’05-Mar.’06) Net Returns during the last 12 months (Apr.’06) Net Returns since Inception in Feb’03 (Annualized) 0.96 97 .75% GOI 2006 11.10% 4. Net Returns during last 1 month (Mar.4% of the funds were invested in short-term Government Securities (Gilts) and to meet liquidity requirement higher about 40% of funds are kept in short term bank deposits.’06) Net Returns during the last 3 months (Jan. In line with the objective of protecting the capital against any erosion.89% Bank Fixed Deposits Asset Name Total Bank Deposit Gilts 6.68% GOI 2006 11.com % of total assets 38. Thesis. The net return credited to policyholders and the asset composition ratios are given in the boxes below. and Reliance Market Return Plan.75 13.69 40.75% GOI 2006 Projects.
the equity holdings in the fund was maintained as close as possible to the maximum of 20% allowed for the fund.com 2.’06) Projects. The asset composition.00 Asset Allocation:- Gilts Bank Deposits 2) Balanced Fund:This fund is for Reliance Golden Years Plan.Total Gilts Total 61. the details of the portfolio and the net returns are disclosed below. To take advantage of the bullish trend in the equity market.40 100. allocation to Gilts was higher than corporate bonds. Within the fixed income portfolio. All the bonds in the portfolio are top rated. Net Returns during last 1 month (Mar. and Reliance Market Return Plan. Dissertation – projectsparadise. To reflect their bearish view on the debt market the duration of the fixed income portfolio was kept low. Thesis.47% 98 . Bank deposits were maintained only for the purpose of liquidity management.
Thesis.’06) Net Returns since Inception in Feb’03 (Annualized) 4.83% 13.10% Asset Name Equity Corporate Bonds & Debentures Gilts Bank Deposits Total % of Total Asset 20 22 53 5 100.’06) Net Returns during the last 12 months (Apr. Dissertation – projectsparadise.-Mar.com 99 .’05-Mar.00 Equity Corporate Bonds & Debentures Gilts Bank Deposits 3) Growth Fund:- Projects.07% 13.Net Returns during the last 3 months (Jan.
To take advantage of the bullish trend in the equity market.60% 7.04% Asset Name Equity Corporate Bonds & Debentures Gilts Bank Deposits Total % of Total Asset 9 40 45 6 100.’06) Net Returns during the last 12 months (Apr. Net Returns during last 1 month (Mar.com 100 . Dissertation – projectsparadise.’06) Net Returns during the last 3 months (Jan.-Mar.90% 21.’06) Net Returns since Inception in Feb’03 (Annualized) 4. the details of the portfolio and the net returns are disclosed below. Thesis.99% 24.00 Projects. and Reliance Market Return Plan. The asset composition. the equity holdings in the fund was maintained as close as possible to the maximum of 20% allowed for the fund.This fund is for Reliance Golden Years Plan. All the bonds in the portfolio are top rated.’05-Mar. To reflect their bearish view on the debt market the duration of the fixed income portfolio was kept low.
In line with the stated asset allocation pattern and their view of the market.46% 57.’06) Net Returns during the last 12 months (Apr.18% 20.’06) Net Returns since Inception in Feb’03 (Annualized) 11.Equity Corporate Bonds & Debentures Gilts Bank Deposits 4) Equity Fund:This fund is for Reliance Market Return Plan. Thesis. the entire corpus of the fund was invested in equities. Net Returns during last 1 month (Mar. Net returns earned since inception and the full portfolio are disclosed below.’05-Mar.83% Projects.com 101 .-Mar.’06) Net Returns during the last 3 months (Jan.02% 64. Dissertation – projectsparadise.
com .Asset Name Equity Mutual Fund/Bank Deposits Total % of Total Asset 98.00 Equity Mutual Fund/Bank Deposits CHAPTER – 8 102 Projects. Thesis. Dissertation – projectsparadise.93 1.07 100.
After the deep study of insurance sector of India, I can tell that this is the sector, which has most business opportunities perhaps in India.
Projects, Thesis, Dissertation – projectsparadise.com
Insurance industry is one of the fastest sectors in India. Insurance sector has been growing by 25% to 30% and it is expected to increase by 50% in coming 5 years. After the opening up of the insurance sector, it has become much competitive and insurance awareness among people has increased. As far as the comparison of Reliance Life Insurance and other players is concerned, there are both positive as well as negative impacts on both the sides. For Reliance Life Insurance, the negative aspect is that its market share is low. For private players the negative aspect is that they have to fight with the public sector giant which is established player with a high brand value. But the positive impact is that the life insurance awareness has increased and the business of Reliance Life Insurance has increased.
BIBLIOGRAPHY AND REFERENCES
Projects, Thesis, Dissertation – projectsparadise.com
www.reliancelife.com www.indiainfoline.com www.bimaonline.com www.google.com
Projects, Thesis, Dissertation – projectsparadise.com
Thesis.com 106 . Dissertation – projectsparadise.Life Time Magazine of Reliance Life Insurance Net Bios Computer Academy’s Life Insurance Book Broachers of Reliance Life Insurance CHAPTER – 10 ANNEXURE Projects.
C.B. Dissertation – projectsparadise.com 107 .K. Thesis.1 What is your main motive behind investing in life insurance? (a) Tax Benefit (b) Savings (c) Risk Cover Projects.Questionnaire Survey by student of R.M. On Life Insurance NAME: ___________________________________________ Q.
Thesis. Which life insurance policy would you prefer to buy? (a) Term Assurance (b) Whole Life (c) Endowment (d) Combination of Whole Life and Endowment (e) Unit Linked Q. Dissertation – projectsparadise.2 Rank the above motives according to your preference MOTIVE OF INVESTMENT TAX BENEFIT SAVINGS RISK COVER RETURN/YIELD Preference 1 2 3 4 Q.3 How do you decide about investing in life insurance? (a) On my own (b) family decision (c) Employer decides (d) as per the guidance of agent Q.5 Would you prefer Reliance Life Insurance or LIC for buying the life insurance policy? (a) Reliance Life Insurance (b) LIC Projects.4.(d) Return/Yield Q.com 108 .
Dissertation – projectsparadise.com 109 .PERSONAL DETAILS 1) Age (a) 18 to 30 (b) 31 to 50 (c) 51 to 65 2) Occupation (a) Service (b) Business Projects. Thesis.
000 4) Family members (a) 2 (b) 3 (c) 4 (d) More than 4 Projects.000 to 5.00.00. Thesis.00.00.000 to 1.(c) Profession (d) Housewife (e) Retired 3) Income (a) 50.000 (c) More than 5. Dissertation – projectsparadise.com 110 .000 (b) 1.
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