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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
Thesis. 1. Insurance is desired to safeguard oneself and one’s family against possible losses on account of risks and perils. Dissertation – projectsparadise.” The other party called insured pays in exchange a fixed sum known as premium. 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. which may be certain or uncertain.2 IMPORTANCE OF INSURANCE Projects.com 7 . It provides financial compensation for the losses suffered due to the happening of any unforeseen events. Insurance is a financial device to spread the risks and losses of few people among a large number of people. Insurance is a collective bearing of risk.Insurance may be described as a social device to reduce or eliminate risk of loss to life and property. as people prefer small fixed liability instead of big uncertain and changing liability.
com 8 . There is lot of potential in the Indian Insurance Industry. The major issue right now is the hike in FDI (Foreign Direct Investment) limit from 26% to 49% in the insurance sector. Dissertation – projectsparadise. new product ranges. So it offers lot of scope for studying the insurance industry. 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. which require study. Government may in near future allow 49% FDI in Insurance. new distribution channels. insurance brokers’ regulation.Insurance constitutes one of the major segments of the financial market. Insurance services play predominant role in the process of financial intermediary. Also the penetration of insurance in Projects. Right now the insurance industry has great opportunities in a country like India or China which huge population. There are number of other hot topics like penetration of Health Insurance. Rural marketing of insurance. Today insurance industry is one of the most growing sectors in India. There are many issues. This would lead to more capital inflow by foreign partners. it has improved in terms of efficiency. Thesis. Though market share of LIC has been affected. incentive scheme of development officers of LIC etc. Another major issue is the effects on LIC after the entry of private players in the market.
In life insurance. etc.3 DIFFERENCE BEETWEN INSURANCE AND ASSURANCE Assurance is older in history and it was used to describe all types of insurances. fire.com 9 .India is very low in both life and non-life segment so there is lot potential to be tapped. From 1826. So first we understand what is insurance? How the word ‘insurance’ is different from the word ‘assurance’? etc. Dissertation – projectsparadise. 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. 1. Projects. The word assurance indicated certainty. Before starting the discussion on insurance industry and related issues. 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. The insured event was bound to happen sooner or later under assurance but the event insured against may or may not happen under insurance. Thesis. we have to start with the basics of insurance. there is an assurance from the insurance company to make payment under the policy either on the maturity or at earlier death.
4 PRINCIPLES OF INSURANCE An insurance contract is based on some basic principles of insurance. the insured is not entitled to make a profit on his loss.The principle of “indemnity” applies to “insurance contracts”(non-life) only. insurance is wider. The scope of the word. In other words. the insurer is entitled to recover from a negligent third party any loss payments made to the 10 Projects.com . Thesis. (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. Dissertation – projectsparadise. In other words. Both the parties should disclose all material information regarding the subject matter of insurance. (2) Principle of indemnity This means that if the insured suffers a loss against which the policy has been made. he shall be fully indemnified only to the extent of loss. 1. (1) Principle of “Uberrima Fides” or Principle of utmost good faith It means “maximum truth”. The insurer before the settlement of the claim may exercise the right.
(4) Principle of causa proxima The cause of loss must be direct and an insured one in order to claim of compensation. The concept of ‘Third Party Claims’ is based on the same principle. (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. he remains in the same old position. Thesis. Dissertation – projectsparadise. 1. 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.5 HISTORY OF INSURANCE Projects.com 11 .insured.
The early history of insurance in India can be traced back to the Vedas.com 12 .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. Dr. The Oriental Life Insurance Company was the first insurance company to be set up in India to help the widows of European community. 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. is found in the Rig Veda. Marine insurance companies came into existence by the end of the eighteenth century. The insurance Projects. Life insurance in its modern form came to India from England in 1818. Thesis. The Aryans practiced some form of ‘community insurance’ around 1000 BC. These companies were empowered to write fire and life insurance as well as marine. The Sanskrit term ‘Yogakshema’ (meaning well being). which were later repaid with interest when the goods arrived safely. 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. With a view to providing fire insurance facilities. the name of Life Insurance Corporation of India’s corporate headquarters. Dissertation – projectsparadise. Nicholas Barbon set up in 1967 the first fire insurance company known as the Fire office. The Great Fire of London in 1966 caused huge loss of property and life.
the Bombay Mutual Life Assurance Society. As a result the government decided to nationalize the life assurance business in India. irregularities and dubious investment practices by scores of companies. This amended insurance Act looked into investments.companies.6 TIME LINE IN INSURANCE HISTORY (MAJOR LANDMARKS) 1818 British introduced the life insurance to India with the 13 Projects. 16 foreign insurers. the first comprehensive legislation governing both life and non-life branches of insurance were enacted to provide strict state control over insurance business. Thesis. came into existence in 1870 to cover Indian lives at normal rates.com . which came into existence between 1818 and 1869. Insurance business flourished and so did scams. and 75 provident societies carrying on life insurance business in India. The first Indian insurance company. 1. The nationalization of life insurance was followed by general insurance in 1972. expenditure and management of these companies. The Insurance Act. treated Indian lives as subnormal and charged an extra premium of 15 to 20 per cent.1950s there were 154 Indian insurers. Dissertation – projectsparadise. By the mid. 1938. The Life Insurance Corporation of India (LIC) was set up in 1956.
General Insurance Corporation (GIC) came into being. 1870 1912 1938 The Insurance Act was enacted. N. 1850 Non life insurance started with Triton Insurance Company. Dissertation – projectsparadise. The Indian Life Assurance Company Act enacted to regulate the life insurance business. Thesis. Non-life business nationalized. Government took over 245 Indian and foreign insurers and provident societies. Malhotra committee recommended reentry of private players. Nationalization took place. Bombay Mutual Life Assurance Society is the first India owned life insurer. in Calcutta. Malhotra to draw a blue print for insurance sector reforms. 1956 1972 1993 Malhotra committee was constituted under the chairmanship of former RBI chief R.establishment of the Oriental Life Insurance Company . 1994 Projects.com 14 .
ICICI Prudential. 2000 IRDA started giving license to private insurers. the insured. Dissertation – projectsparadise. HDFC were first private players to sell insurance Policies. although the owner and Projects.com 15 . 2001 2002 Bank allowed to sell insurance plans as TPAs enter the scene.1997 IRDA (Insurance Regulatory and Development Authority) was set up as a regulator of the insurance market in India.7 MEANING OF LIFE INSURANCE There are three parties in a life insurance transaction: the insurer. and the owner of the policy (policyholder). 1. Thesis. Royal Sundaram was the first non-life private player to sell an insurance policy. insurers start setting non-life claims in the cashless mode.
guaranteed cash values. buy a term life insurance policy. unless the owner fails to pay the premium when due. Projects. A universal life policy includes a cash account. Another important person involved in a life insurance policy is the beneficiary. The primary advantages of whole life are guaranteed death benefits. and mortality and expense charges will not reduce the cash value shown in the policy. Thesis. If you want insurance protection only. The policy does not accumulate cash value. Premiums increase the cash account. Dissertation – projectsparadise.the insured are often the same person. • Permanent life insurance is life insurance that remains in force until the policy matures. and a cash value table included in the policy guaranteed by the company. fixed and known annual premiums.com 16 . • Whole life insurance provides for a level premium. • Term life insurance provides for life insurance coverage for a specified term of years for a specified premium. Life insurance may be divided into two basic classes – term and permanent. and not a savings and investment product. • 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.
Dissertation – projectsparadise. was so prevalent. These provided the underpinning for marine insurance contracts. Check the National Association of Insurance Commissioners website (www. Over 5000 years ago.org/cis) or your local library for information on the financial soundness of insurance companies.com 17 . and a surcharge to cover the possibility of loss. universal life.naic. Thesis. or other cash value policy. insurance was seen as a preventative measure against piracy on the sea. Such contracts contained three elements: a loan on the vessel. In 2100 BC. the Code of Hammurabi granted legal status to the practice. cargo. Protecting against risk is what insurance is all about. in China. 1. ship owners were the insured and lenders were the underwriters. a number of ships would carry a portion of another ship's cargo so that if one ship was captured. nearly 4. In another part of the world. that as a way of spreading the risk. plan to hold it for at least 15 years. an interest rate. Piracy. or freight.8 HISTORY OF LIFE INSURANCE Risk protection has been a primary goal of humans and institutions throughout history. in fact. It formalized concepts of “bottomry” referring to vessel bottoms and “respondentia” referring to cargo. In effect.If you want to buy a whole life. Canceling these policies after only a few years can more than double your life insurance costs. Projects. in the ancient land of Babylonia. the entire shipment would not be lost.500 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.
transportation. is derived from the Rig Veda. Lloyd's of London. Dissertation – projectsparadise. Thesis. or as they were known then. particularly with merchant and artisan guilds. With Rome's fall.. Insurance in India can be traced back to the Vedas. But during the 14th to 16th centuries. During the feudal period. theft. life insurance in England was vigorously promoted in the three decades following the Glorious Revolution of 1688. The term suggests that a form of "community insurance" was prevalent around 1000 BC and practiced by the Aryans. These provided forms of member insurance covering risks like fire. disability. around 450 A. and insurance would again reemerge.com 18 . most of the concepts of insurance were abandoned. as well as help survivors monetarily. flood. yogakshema. early forms of insurance ebbed with the decline of travel and long-distance trade. burial societies were formed in the Buddhist period to help families build houses.D. And similar to ancient Rome. For instance. death. and even imprisonment. The type of insurance we see today owes it's roots to 17th century England. but aspects of it did continue through the Middle Ages. commerce.Life insurance came about a little later in ancient Rome. Modern Insurance Illegal almost everywhere else in Europe. Lloyd's Coffee Projects. where burial clubs were formed to cover the funeral expenses of its members. and to protect widows and children. the name of Life Insurance Corporation of India's corporate headquarters.
Dissertation – projectsparadise. Two years later. ship owners and underwriters met to discuss and transact business deals. life insurance also appealed strongly to the gambling instincts of England's burgeoning middle class. that when newspapers published names of prominent people who were seriously ill. The key to its success was reducing the opposition from religious groups. Thesis. But it wasn't until 80 years later (after 1840). In 1835. Reacting against such practices. The year 1735 saw the birth of the first insurance company in the American colonies in Charleston.House. The Presbyterian Synod of Philadelphia in 1759. And the first life insurance policy for the general public in the United States was issued. the infamous New York fire drew people's attention to the need to provide for sudden and large losses. in Philadelphia. sponsored the first life insurance corporation in America for the benefit of ministers and their dependents. bets were placed at Lloyd’s on their anticipated dates of death. The Projects. in fact. 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.S. on May 22. was the location where merchants. insurance industry was built on the British model. Gambling was so rampant. SC. that life insurance really took off in a big way.” Making wagers on people's deaths ceased in 1774 when parliament forbade the practice.com 19 . Insurance moves to America The U. Massachusetts became the first state to require companies by law to maintain such reserves. 1761. While serving as a means of risk-avoidance.
In 1897. which first made its appearance in the 1880s.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. land diversity and the overwhelming desire to be independent. Final Thoughts Even though the American insurance industry was greatly influenced by Britain. Employees contribute a certain percentage of the premium for these policies. which made it mandatory for a company to insure its employees against industrial accidents. providing not just life insurance. membersonly insurance. With the creation of the automobile. Thesis. public liability insurance. as do most labor organizations.com 20 . from a farming country to an Projects. many societies were founded to insure the life and health of their members. Dissertation – projectsparadise. As America moved from a colonial outpost to an independent force. the British government passed the Workmen's Compensation Act. wherein the risks are spread among several companies. Contributing to that was America's size. Even today. the US market developed somewhat differently from that of the United Kingdom. The practice of reinsurance. During the 19th century. while fraternal orders provided low-cost. Many employers sponsor group insurance policies for their employees. but sickness and accident benefits and old-age pensions. was devised specifically for such situations. gained importance and acceptance? More advancement was made to insurance during the process of industrialization.
industrial nation. 2) Assignment: If your intention is that your policy monies should go only to a particular person.9 KEY FEATURES OF LIFE INSURANCE 1) Nomination: When one makes a nomination. Thesis. the insurance business developed from a small number of companies to a large industry. 1. Dissertation – projectsparadise. you need to assign the policy in favor of that person. offering new types of coverage and diversified services for an increasingly complex country. The nominee has only the right to receive the policy monies in case of your death within the term of the policy. Insurance became more sophisticated.com 21 . provided the premiums have been paid and the policy has not been surrendered. Permanent policies provide a death benefit that is guaranteed for the life of the insured. 4) Cash Value: - Projects. 3) Death Benefit: The primary feature of a life insurance policy is the death benefit it provides. 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.
8) Conversion from Term to Permanent: When in need of temporary protection. Dissertation – projectsparadise. one of which is toward the purchase of additional coverage. This feature allows the policy owner an easily accessible loan in times of need or opportunity. individuals often purchase term life insurance. 5) Dividends: Many life insurance companies issue life insurance policies that entitle the policy owner to share in the company's divisible surplus. after any applicable surrender charges. Either a fixed or variable rate of interest is charged. If one owns a term policy. It equals the amount a policy owner would receive. called paid-up additions. 7) Policy Loans: Some life insurance policies allow a policy owner to apply for a loan against the value of their policy. 9) Disability Waiver of Premium Projects. sometimes a provision is available that will allow her to convert her policy to a permanent one without providing additional proof of insurability.com 22 . if the policy were surrendered before the insured's death. 6) Paid-Up Additions: Dividends paid to a policy owner of a participating policy can be used in numerous ways.The cash value of a permanent life insurance policy is accumulated throughout the life of the policy. Thesis.
com 23 .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. It guarantees that coverage will stay in force and continue to grow 1. Thesis. Dissertation – projectsparadise.Waiver of Premium is an option or benefit that can be attached to a life insurance policy at an additional cost. Life Insurance policies thus decrease the total taxable income of an individual. Projects. 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. The industry is recognized as one of the largest financial Institutions in the country.oriented sectors the Industry has contributed immensely to the nation's development. Moreover the cash value can be used as an additional income in the old age.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. 1.3) 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. Dissertation – projectsparadise. Through investments in the Government sector and socially. It has a Consistent profit and dividend paying record accompanied by a steady growth in its financial resources.com 24 . The ventures initiated by the industry in the areas of Mutual Fund. 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.
CHAPTER-2 INTRODUCTION TO THE COMPANY Projects.com 25 .Housing Finance has done exceedingly well in recent years. To protect the country's foreign exchange reserves. Thesis. Dissertation – projectsparadise. 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.
com 26 .2. Thesis. of the Reliance . Dissertation – projectsparadise.1 ABOUT RELIANCE LIFE INSURANCE Reliance Life Insurance Company Limited is a part of Reliance Capital Ltd. 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 Projects.Anil Dhirubhai Ambani Group.
Thesis. private equity and other activities in financial services. stock broking. 1934. Reliance Capital has interests in asset management and mutual funds.of net worth. 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. This was after obtaining the required regulatory approvals from the Registrar Of Companies and the Insurance Regulatory and Development Authority. 2.2 HISTORY Reliance Capital Limited announced the launch of its life insurance business on February 1. 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 steps forward for Reliance Capital Limited to offer need based Life Insurance solutions to individuals and Corporate. the financial arm of Reliance – Anil Dhirubhai Ambani Group 27 Projects. life and general insurance. 2006. It was in August 2005 that the ball was set rolling when Reliance Capital Limited. Dissertation – projectsparadise.com . proprietary investments.
3 JOURNEY SO FAR… 2005 August: Co Ltd. and the formal transfer of shares took place in October 2005.com 28 .(ADAG) – announced the requisition of 100% shareholding in AMP Sanmar Life Insurance Company Limited. 2006 January 17: ‘Optimising Mr. All the existing policy contracts also stand transferred to the Reliance Life Insurance entity with all the original contractual terms and commitments intact. 2. Thesis. Dissertation – projectsparadise. The company will issue all policy contracts under the Reliance Life Insurance Company limited name. 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.
4th Floor. 2. March 7: The new office at Chennai. Thesis. COO. March 6: Shifting to the new premises at Churchgate commences. Sureshbabu also graced the occasion. First Floor. Mumbai. Mumbai.‘Emerging Bancassurance’ organized by the Asia Insurance Post at the Taj President. Nandgopal. Amongst those who participate are the CEO. Nelson Manickam Road. with fail-over capability to their Chennai Data Centre Projects.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. KV Srinivasan and Mr. February 26: A Puja held at the Churchgate office situated in Express Building. 14 ‘E’ Road. Amitabh Chaturvedi and Mr.com 29 . February 16. 18: Strategy meet at the Reliance Management Institute. Nandgopal. Functional Heads. Mr. # 39. Dissertation – projectsparadise. Regional Managers and Regional Sales Managers. Mr. February 1: Rliance Life Insurance officially launched. March 1: Churchgate office inaugurated by Mr. 17. at the Trapezium. Amitabh Jhunjhunwala. inaugurated by their CEO Mr.
Dissertation – projectsparadise. 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. 3) Customer Care Centre: They will host a centralized Customer Care Centre at Dhirubhai Ambani Knowledge City at Navi Mumbai. Life-Asia and Internet Applications. Under Writing Medical System. and Agent Management System etc. Quality Checking System. A customer Relationship Management Tool (CRM) and Lead Management System (LMS) are in progress. 4) Web Portal: This portal will be an interface between both internal employees and their external users. 5) R World: 30 Projects. Thesis.within the same business day in occurance if an incident or Disaster happens. Some of the functions included in their portal are Policy Tracking Systems. 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.com . which cater services to internal and external queries and complications. Corporate News.
The Agents/Advisors can use this area to service their existing customers. Policy Dispatch Details. and Policy Services to their existing customers. where their Advisors can bring in the prospects and can have discussions across the table and they can create and print quotes. Agents/Advisors and Lead Generators. This Lounge will be equipped with desktops and printers with Internet connectivity. 6) SMS Alerts: SMS Alerts will be provided to their Sales Managers about the latest happenings like Contests and Campaigns. Thesis. Products.Reliance Mobile R-World will provide online information about their Company. Customer Alerts will include Welcome/Birthday/Anniversary message. 8) Advisor Lounge: It is a dedicated area for Reliance Life Insurance Agents/Advisors in all the branches across India. 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. Employee Alerts will include Company News and Welcome/Birthday/Anniversary message etc.com 31 . 9) Document Management System: Projects. Dissertation – projectsparadise. 7) Life and Group Asia: Single Life and Group Life details will be captured and managed by Life and Group Asia. Policy Servicing SMS like Premium Receipt and Renewal Premium reminders etc.
business results. Travel and Leave Management Systems. 2. customer care and employee focus. will automate the Expense.com 32 . 11) SAP – ERP Modules: SAP (Finance and HR Modules). 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.DMS will enable both policy issuance and contract servicing through an automated workflow. 2. The aim of the company is to Think Bigger and Think Better. This application will enable them to have a paperless office and thus mitigate the risk of losing vital records/papers. which yields a faster Turn around Time to both internal and external users. Thesis.6 CORE VALUES Reliance Life Insurance Company Limited has some core values which are listed as follows: Projects.5 MISSION The mission of Reliance Life Insurance Company Limited is to be the best in every sphere. Dissertation – projectsparadise.
1) Result Oriented 2) Performance Driven 3) Customer Focused 4) Learning and Development Oriented 5) Employee Centric 6) Informal and Fun 2. responsive services to the caller and promptly address queries.com 33 . A state-of-the-art customer care centre will provide continuous. Dissertation – projectsparadise. collate feedback and suggestions from the caller. and a pan India presence with 162 branches in the coming year. It will be launching additional products aimed at providing unparalleled service to its valued clientele.7 FUTURE PLANS Forty-four new branches to be opened across the country in the coming months. Thesis. 2.8 HEAD – OFFICE Projects. who may be both prospective and existing clientele and from channel partners in Chennai and Mumbai.
Chennai – 600 029.9 BRANCHES They have so many branches and substations in the India. 39. And they have planned to open more branches across the country in the coming months. Dissertation – projectsparadise. They have around 160 branches in the India.Reliance Life Insurance Company Limited.com 34 . 2. Thesis. Nelson Manickam Road. The Trapezium. First Floor. Projects.
Dissertation – projectsparadise. Thesis.com 35 .CHAPTER – 3 PRODUCT MIX Projects.
com . Fundamentally the product provide for: Risk cover Investment Health cover 36 Projects.1 TRADITIONAL PLAN:Life insurance products are designed to suit the requirements of customers.3. Thesis. Dissertation – projectsparadise.
Based on the coverage of the product. and do not wish to save for themselves. to a certain degree. the premiums are calculated and the customer pays accordingly. risk cover is imperative for it to fall under the category of insurance.com 37 . 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.In every product. In order to suggest the right product. Thesis. it is essential for an agent to understand the requirements of the customer well. Reliance Life Insurance Company Limited has offered 9 traditional plans to the customers. 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. Since Projects. Dissertation – projectsparadise.
Dissertation – projectsparadise. Hence. 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.com 38 .A.there is no saving element or bonus provision. 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. this is a high-risk plan with a low premium. Thesis. the premium is very low. 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.
or is perhaps planning to go abroad. 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. 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. 25. This money is payable in equal installments over the last 4 years of the policy term.com 39 .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. Minimum entry age is 20 year and maximum 60 year a) Minimum sum assured is Rs.000. a Doctor or specialize in some other field. Features: I. Dissertation – projectsparadise. Thesis.
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. In a nutshell this plan will keep you financially prepared for all the special occasions in your life . your child’s university education or even a new office for your business .Reliance Life Insurance’s Reliance Endowment Plan is the key to all your financial needs. Dissertation – projectsparadise. Reliance Endowment Plan will also assist your loved ones through this difficult time by the financial support that it provides. It is an inexpensive and easy way to protect you. Thesis. your family or your business. which you will receive at the end of the policy period.your daughter’s wedding.by eliminating the burden that a shortage of money creates. In the event of your untimely death.com 40 . Reliance Endowment Plan also gives you the additional benefit of participating in the company’s profits.
000 or as determined by the minimum premium e) Maximum sum assured is Rs.d) Minimum sum assured is Rs. are characteristics of the policy. 25. 25. This plan also participates in the profits. 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. Dissertation – projectsparadise.com 41 . 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.000 c) Minimum premium paying term is 10 year and maximum 40 year Projects.00. Thesis. Features: a) Entry age minimum 12 year and maximum 65 year b) Minimum sum assured is Rs. The unique feature of this policy is that life protection continues for five years after you have stopped the payment of premium. 5.000 (entry age below 18 years and no limit for entry age 18 and above) f) Premium mode annual.
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. and renovation of your home or perhaps. a holiday abroad.com 42 . it can be used to meet any immediate financial crisis in the family like your son's college admission. while providing simultaneously. Features:a) Plan with profits b) Minimum entry age is 15 year and maximum is 63 year Projects. The money is payable in installments. a periodic return of lump sums which become available for reinvestment at higher returns. but create. your daughter's engagement. through regular premium payments. Alternatively. Dissertation – projectsparadise. The first installment is paid at the end of the 4th year and thereafter at the end of every 3rd year. Thesis. The advantage of the policy is that they need not part with a sizable amount of money at any one time. substantial life cover.
home improvement. 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. Features: a) Loan protection against home.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. Thesis. Dissertation – projectsparadise.com 43 .
Projects. disability or critical illnesses.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. Features: a) Loan protection against home.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. Dissertation – projectsparadise. home improvement.com 44 . 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.
In this way. 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). A small part of the contribution is used for providing life cover and the balance is invested in unit. Dissertation – projectsparadise. etc. a small investor can benefit from investment in a managed fund without making a large financial commitment.Each premium paid by the insured person is split: a part is used to provide life assurance cover. Thesis. Reliance Life Insurance Company Limited has also offered the two Unit Linked Plans. unit linked policies can go up or down in value. 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. As they are linked to the value of shares.) is used to buy units in a unit trust.com 45 . Legal heirs are entitled to the amount of insurance cover and entitled units in case of death of the insured. while the balance (after the deduction of costs. 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. expenses.
ii. 2500 (standing order/credit card) d) Top up premium minimum Rs. 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. 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. 1000 (for salary deduction only) and Rs. iii. half yearly and monthly Rs.com 46 . iv. 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. 2500 e) Option of investment fund i.choice. quarterly. Thesis. 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.
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. The Reliance Life Insurance ‘no-worry stay happy’retirementplan.000 2) Reliance Golden Years Plan: Reliance Golden Years Plan…. Features: a) Entry age minimum is 18 year and maximum 65 year b) Minimum premium amount Rs.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. Reliance Golden Years Plan. 10. Contributions provide Income tax savings as well. vesting options such as commuting and annuity options. life cover. Thesis.com 47 . Dissertation – projectsparadise.. a flexible pension product is available for all individuals who are between the ages of 18 and 65. 10. Reliance Golden Years Plan is a flexible package that provides freedom of choice in choosing the type of investment.
Dissertation – projectsparadise. Thesis. 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. 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. ii.i.com 48 . ii.
com 49 .4. Dissertation – projectsparadise. Projects.1 RECRUITMENT Recruitment is the process of finding and attracting capable applicants for employment. The process begins when new recruits are sought and ends when their applications are submitted. Thesis. The result is a pool of applicants from which new employees are selected.
does the recruitment. The advisors should have at least passed the S. They must pass the prerecruitment examination. the validity the license would be 3 years. 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. Dissertation – projectsparadise. Mumbai.In this company the Sales Manager. 4. examination.S. the person will become an insurance advisor in the company. After all these requirements.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. Projects. which includes-. it is the process of differentiating between applicants in order to identify these with a greater likelihood of success in a job. In simple words.com 50 . The Branch Manager. or any other approved examination body. who recruits the advisors/agents for selling the products of the company. Thesis. After clearing the examination the code will be provided to them and the license will also be given to them.C. which is conducted by the Insurance Institute of India.
Dissertation – projectsparadise. who will check his/her performance. Projects. the negotiation will be provided to the applicant. the applicant should be interviewed by the Regional Head. the medical check up should e made to the applicant. 5) Medical Examination: After that. the project 40 interview will be taken by the Branch Manager. 4) Negotiation: After clearing the interview with Regional Head. In this step. 3) Interview with Regional Head: After clearing the project 40 interview. Thesis.2) Project 40 Interview: After clearing the personal interview. 6) Selection: After clearing all the above steps the applicant should be appointed/selected as a Sales Manager in the company.com 51 . the applicant should have to make a list of 40 and then start the business with them.
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. 5. Manager should possess the 4. training. They should have good communication skill. 3. They should have at least sales experience of 3 years. 6. 2. Their job profile includes recruitment. 4. Thesis.Requirements of Sales Manager:The Sales following things1. Dissertation – projectsparadise.A.B. motivating and in turn getting business out of a team. They should be an M. The age of them should be between 25 to 35 years. guiding. The need for training and development is determined by the employee’s performance deficiency. They should have the capability to handle the team. computed as follows: Projects.com 52 .
The NIS SPARTA Institute has more than 150 batches and is trained over 3000 agents for most of the private insurance companies. information. Thesis. and experience to others. which enabling free interaction between all levels.4 CAREER DEVELOPMENT They are also providing career development plans. things. This institute is approved by IDRA to train agents/advisors.Training & Development = Standard Performance – Actual Performance They are providing 100 hours training to their advisors.com 53 . They are providing an open environment.5 COMMUNICATION Communication is the process through which an individual can exchange their beliefs. 4. They are also providing the product training to their advisors and Sales Managers. who are newly recruited. 4. who are newly recruited. In simple words. The 100 hours training is to be conducted at Net Bios Computer Academy whereas the product training is to be conducted at NIS SPARTA. it is the process of exchanging the information from one person to another. Dissertation – projectsparadise. The communication is provided in the following manner: Projects. which will identify potential and create avenues for growth.
Dissertation – projectsparadise. Thesis.com 54 .Projects.
Thesis.com 55 .BRANCH BRANCH BRANCH REGIONAL REGIONAL REGIONAL CHANNEL HEAD CMO CEO Projects. Dissertation – projectsparadise.
then Regional Head to Channel Head. Projects. They are providing an aggressive reward and recognition plans. and then Branch Head to Regional Head. 1) They are providing knowledge sharing and certification practices. which are including sales incentives. associates and their families. then to Chief Executive Officer (CEO). Within a branch.6 INCENTIVES Incentives are monetary benefits paid to workmen in recognition of their outstanding performance. then different Regional Head to Regional Head. which includes employees.com 56 . 2) They are planned team building and fun events. 4.Explanations of the diagram:The communication is flow between Branch to Branch. then to Chief Marketing Officer (CMO). 4.7 SERVICES They are offering following certain services to their employees. Thesis. Dissertation – projectsparadise. 3) They are creating Reliance Life Insurance family. it flows between Branch Manager to Sales Managers and Sales Managers to Agents/Advisors.
Projects. achievement oriented and challenge loving performance.com 57 . 4. 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.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. Dissertation – projectsparadise. 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. In addition to this. Thesis.4) Reliance Life Insurance in a team building mode and is looking for performance driven. organization and society all benefit. which goals and measure financial. process related and employee development related initiatives. customer focused. Performance appraisal is a formal. They are providing a balanced scorecard approach for strategy deployment and performance measurement. If the performance is best then he/she will be prompted.
com .9 ORGANIZATION STRUCTURE CEO CMO Channel Head Regional Head Branch Head SalesCEO Manager Advisors/Agents Customers FORM AND 4. Thesis. Dissertation – projectsparadise.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.4.
8) Finance CHAPTER – 5 MARKETING DEPARTMENT Projects.com 59 . Thesis. Dissertation – projectsparadise.
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.5.com 60 . is an agency. their emergence may potentially be realignment in the distribution of financial services. This channel works as follows: Branch Managers Advisors Customers Projects. The one type of distribution channel. Ltd is using. Independent agents & insurance producer groups are growing in prevalence.1 DISTRIBUTION CHANNEL Reliance Life Insurance Company Limited is using five types of distribution channel. Thesis. they had increased buying power. Although producer groups are in their infancy. Independent shops realized that by pooling production and funding a central support office. Dissertation – projectsparadise. which Reliance Life Insurance Co.
a research was performed with independent advisors across several broker/dealers and custodians. the advisors will sell the products/policy to customers of the small enterprises. which are for employee benefits.com 61 . 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. Banks are failing to incorporate successful sales tactics used to sell other financial services like investments. Thesis. credit life. and direct marketing insurance. The interviews revealed that demand is greatest for living trusts among independent advisors. 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. Dissertation – projectsparadise. to sell the policy of the company. This channel is tie up with corporate or small enterprises.. This channel is tie up with banks. Another type of distribution channel is corporate.2) Bank Assurance: While a lot of bank relationships with insurance companies have been established. Through these small enterprises. Another type of distribution channel is bank assurance. life insurance sales have been slower than one would expect he primary bank insurance activities have been the distribution of annuities. Projects.e.
primarily at the expense of the banks. Across all financial services.com 62 . In this channel. Insurance companies view full-service brokers as a potentially new distribution channel as well. 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. are listed in the website. Web sites are starting to pop up offering consumer insurance products especially designed for distribution over the web.4) Rural Benefits:Brokerage firms have gained much of the institutional and personal trust business lost by the banks. Thesis. but many of the traditional full-serve players seem to be letting it go. 5) Web World:Direct sales of life insurance are growing rapidly. Another type of distribution channel is rural benefits. These firms have steadily captured assets. which are taken from the customer database. This channel is tie up with customer database. the dealers will sell the policy to the target customers. In this channel. Another type of distribution channel is web world. This channel works as a dealership. Dissertation – projectsparadise. the advisors will sell the policy to the target customers. Projects.
Dissertation – projectsparadise. to sell the more policies.com 63 ..2 PROMOTIONAL TARGET SEGMENT PROGRAMMES & Promotional programmes and target segment are related to each other. Thesis.5. which are as follows: 1) Shubh – Arambh:This promotional scheme is detailed as follows: SLAB (WRP) ACHIEVERS REWARD Projects. Ltd has made three promotional schemes. The promotional programmes are made to motivate the advisors/agents and sales managers to do more business i. The Reliance Life Insurance Co.e.
G.000 75.000 STAR ACHIEVERS 50.E.000 10.A.R.00.000 15.000 20. This programs consists of 1.00.00. Thesis.4LS 2) R. Board of Advisors Projects. Dissertation – projectsparadise.00.30.50.00.000 7.000 1.000 1.00. New Advisor Incentive Program 2.000 2.A. is Reliance Advisor’s Reward Experience.00.00.:The full form of R.00.50.com 64 .R.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. Microwave.000 3.000 1.19L 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.E.000 SUPER ACHIEVERS 5. Maruti Swift Lxi GM Aveo 1.000 50.00.000 75.
R.com 65 . Advisor Career Progression 5. Business criteria Projects. Annual Discovery Series 4.A.R. Program Board of Advisors:Criteria There will be two levels in the Board of Advisors program A. R. Program Discovery Series:Criteria There will be six levels in the Discovery Series program A. Thesis. Time Period B. Parameters 3.E. Take Off 2. Qualification period B. Dissertation – projectsparadise. Program New Advisor Incentives:Criteria There will be two levels in the New Advisor Incentive program A. Launch Pad B.E.R.3.E.A.A. R. RARE Club – Loyalty Program The above programs are described as follows 1.R.
Logins from 1st Apr ’06 to 31st Mar ‘07 II. Privilege Club:Levels A. Business (WRP) II. Qualification for the National Discovery Series F. Thesis. The top 150 will bb calculated based on WRP (Weighted Recd Premium) 4.com . Persistency III. The qualification period is I.E. Product Mix C. R. Dissertation – projectsparadise. Issuances from 1st Apr ’06 to 15th Apr ‘07 Qualification Criteria 66 Projects. The RARE Club will have 6 different levels B. R.R.E. Qualification for the Global Discovery Series E.A.R. Program Advisor Career Progression:Advisor Career Progression A. The criteria for entry into each level will be based on I. Sales Manager 5.A. The qualification criteria will be the same for both the Global and the National Discovery Series D. Business Associate B.C.
Projects. Dissertation – projectsparadise.000 10.50.000 50.00. who have login the regular premium of Rs. 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.000 25.3 COMPARATIVE STUDY Presently there are 15 Life insurance companies in the country. 00. 2.00.000 5.00. Thesis.000 15.00. 5.com 67 .Level Topaz Pearl Sapphire Emerald Ruby Diamond WRP (Rs) 1. There is only one public sector company LIC and the rest 14 are private sector.00.000 will be eligible for the Elite Club Membership.
89%.35%. It is a private sector company.87%.com 68 .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.44%. Dissertation – projectsparadise. The company was registered on 23/10/2000. The company was registered on 31/1/2001. The company was registered on 24/11/2000. It is a private sector company. ICICI Prudential Life Insurance: ICICI Prudential Life is a 74:26 joint venture between ICICI and Prudential. Thesis. The market share for FY 200506 was 1. Being the first to be established LIC is the forerunner in the Life Insurance sector. It is a private sector company. Life Insurance Corporation of India (LIC): Life Insurance Corporation of India is a 100% government held Public Sector Company. The market share for FY 2005-06 was 7. Kotak Mahindra OLD Mutual: - Projects. The market share for FY 2005-06 was 2. The market share for FY 2005-06 was 71. HDFC – Standard: HDFC standard is a 74:26 joint venture between HDFC and Standard Life.
The company was registered on 2/8/2001. The company was registered on 6/8/2001. It is a private sector company.79%. The market share for FY 2005-06 is 0. Aviva Life Insurance India: Aviva Life insurance is a 74:26 joint venture between Aviva and Dabur. The company was registered on 14/5/2002. It is a private sector company. It is a private sector company. It is a private sector company.13%) and ING (26 %).Kotak Mahindra OLD Mutual is a 74:26 joint venture between Kotak Mahindra bank and Old Mutual.23%. The market share for FY 2005-06 was 1.com 69 . ING Vysya Life insurance: ING Vysya Life Insurance is joint venture between Exide (50%). Enam (9.11%. The market share for FY 2005-06 was 1. Dissertation – projectsparadise. The company was registered on 10/1/2001.14%. Thesis. Pallonji & Co and MetLife. Max New York Life: Max New York Life is a 74:26 joint venture between J & Bank. Met Life India: - Projects.87%). The market share for FY 2005-06 was 1. Gujarat Cements (14.
It belongs to the private sector. Pallonji & Co and MetLife. The company was registered on 3/8/2001.Met Life India is a 74:26 joint venture between 74:26 JV between J & Bank.: Bajaj Allianz Life Insurance Company is a 74: 26 Joint venture between Bajaj Auto limited and Allianz AIG. The TATA AIG Group: TATA AIG group is a 74:26 JV between Tata Group and AIG. It is a private sector company. The market share for FY 2005-06 was 1. Dissertation – projectsparadise.56%. The market share for FY 2005-06 was 7.29%.A. The company was registered on 31/3/2001. The company was registered on 12/2/2001. The company was registered on 6/8/2001. SBI Life Insurance Company Ltd: SBI Life Insurance Company is a 74: 26 Joint venture between SBI and Cardiff S.It is a private sector company. The market share for FY 2005-06 was 2. Sahara India Life Insurance Company Ltd.com 70 .31%. Bajaj Allianz Life Insurance Co. The market share for FY 2005-06 was 0.: - Projects.40%. Thesis.
The market share for FY 2005-06 was 0.First Wholly Indian Owned Private Life Insurance Company.56 7. 2) Market Share: - Sr.87 71 Projects. Thesis.06 %. The Company commenced operations from 30th October 2004. Dissertation – projectsparadise.com . The company expects to start operations soon. 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. South Africa.44 7.35 2. No 1 2 3 4 Insurer LIC Bajaj Allianz ICICI Prudential HDFC Standard Market Share (%) 71.
54 0.79 0.31 1.14 1. Thesis. Dissertation – projectsparadise.06 0.5 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 2.89 1.29 1.11 0.4 0.23 1.03 Now let’s depict the market share of these players on diagram Projects.com 72 .
ICICI Prudential is also one of the fastest growing life insurance companies in India. It has the market share of approximately 7. 73 Projects. Rest of the players has market share below 2%. HDFC Standard comes third. Among private players Bajaj Allianz stands first. Dissertation – projectsparadise.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.56% in the total market and it constitutes 40% of the market share among private players. Thesis. SBI Life insurance Company Limited comes fourth. Its market share was approximately 98% before 2000 but after the entry of private players it has significantly decreased.com .
com 74 . 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. Thesis.
Thesis.com 75 . Dissertation – projectsparadise.CHAPTER – 6 RESEARCH METHODOLOGY Projects.
Dissertation – projectsparadise. 2) To improve our ability to sell a financial product like life insurance. Thesis.com 76 . Projects.6.1 OBJECTIVES OF STUDY 1) To get some good market exposure by dealing with the prospects face to face.
I have asked personal questions at last so that respondent does not become defensive. The form of each question is also important. unbiased wording questions. Dissertation – projectsparadise. Thesis. which provide answers that are easier to interpret and tabulate. direct. 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. I have used simple.3) To know the perception of the consumer about life insurance. Closed end question include all the possible answers and subjects matters choices among them. 6. which are arranged in a logical order. 4) To get a deep knowledge of the financial product like insurance.com 77 . I have taken care in the wording and ordering of questions. I have used open-end questions so that customers can write answer in their own words. I have also used closed-end questions. Projects.2 QUESTIONNAIRE It is most common instrument whether administered in person by phone or online questionnaires are very flexible.
I have asked personal questions at last so that they do not become defensive. where thy want to invest. I have gathered secondary data and primary data and collected information from the combination of these two data. I have tried to know their performance i. different magazines. Thesis. newspapers and libraries.3 SAMPLING METHOD AND SAMPLE SIZE Introduction:Any organization whether big or small. up to what amount and since when. I have gathered secondary data from website of different operators. having been collected for another purpose.com 78 . Dissertation – projectsparadise. private or public need different types of information are to know its popularity.Questionnaire of the customer I have made questionnaire consisting seventeen questions to get customer’s view about life insurance. Secondary data: Secondary data consist of information that already exists somewhere. whether they want to invest. 6. Primary data: Projects.e.
4 LIMITATIONS I am a human hang.I have taken great care while collecting primary data to answer that it is relevant. The following are the limitation of this research study. I have visited them personally to get data. accurate. current and unbiased.com 79 . Thesis. so there is some limitation of the human hangs which is reflected in this research. I have taken a sample of 50 people. Sample size: I have taken sample size of 50 respondents. Because the population is too large so it is difficult to survey. 6. Projects. Dissertation – projectsparadise.
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. I tried hard to come at conclusion. 2) The opinion expressed by the respondents may be biased. Thesis. Dissertation – projectsparadise. But in spite of their limitation I worked with the enthusiasm. 6. If I give more time then studies will be more effective. 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.5 ANALYSIS OF QUESTIONNAIRE Here I have formed a questionnaire to study why people go for life insurance.com 80 . There are some limitations of this study. And I tried to give the best results to the research of this report. 3) The attitude of the research might be biased. as the sample size is too small for total population of Ahmedabad city. but there is lack of expertise. 5) Another limitation is that there is lack of time.1) The sample size of 50 might not represent the perception of whole population.
Thesis. I asked the questions to Doctors. 6 questions are close ended and one question is an open ended one.com 81 . Advocates. and general public. and the target group was a mix of people from the society. Q. Dissertation – projectsparadise. Professionals. Professors.Questions:There are 7 questions in the questionnaire. Analysis:I have used pie charts.1 What is your main motive behind investing in life insurance? (a) Tax Benefit (b) Savings (c) Risk Cover (d) Return/Yield Projects. Target Population:I had conducted this survey among 50 people. Out of these 7 questions. and some other statistical measures to analyze the questions. Engineers.
com 82 . But some people consider different advantages of a life insurance policy. Some believe that life insurance is an investment so they tend to invest in life insurance. Now let’s see what all people say TAX SAVING RISK COVERAGE RETURN/YIELD Projects. Some people consider Tax benefit as the main advantage of life insurance. 20 5 23 2 50 There could be any motive of people behind investing in a life insurance policy. Dissertation – projectsparadise. While some people believe that it is a compulsory saving. The main purpose of life insurance is the Risk cover of one’s life.MOTIVE TAX SAVING RISK COVERAGE RETURN/YIELD TOTAL NO. Thesis.
more and more people are turning towards these products so the Investment motive has been gaining command. life insurance is for protection first then for Savings and Tax benefits all those things.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. As the private players have launched ULIPs. Also the number of those people who wish to invest for return is also increasing. 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. If we take a larger sample. Dissertation – projectsparadise. Saving motive constitutes very small part of the total sample. Thesis.com 83 . Q. The next preferred option is Tax Saving. Return comes last. According to a life insurance expert (Vinod Thakkar ). But this is the general conclusion of 50 people.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.
This shows that still people consider other financial tools more viable for return and life insurance is for Tax benefit and risk cover.com 84 . Thesis. Q. The third position is of saving and fourth is Return. which is the main theme of life insurance followed by Tax benefit.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. Dissertation – projectsparadise.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.
com 85 . 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 would invest. 28% persons decides as per the guidance of the agent. Thesis. Projects.companies so people take help of the life insurance agent and as he guides understanding the needs of the individual. People tend to invest in life insurance plans to maintain relations though they are not in need of life insurance. Dissertation – projectsparadise. Here one hazardous factor is the moral hazard. Also sometimes it depends upon the convincing power of the agent. SOURCE ON MY OWN FAMILY DECISION EMPLOYER DECIDES AGENT GUIDANCE TOTAL NO.
com 86 . 9 9 7 19 6 50 Projects. We have already explained all these policies ahead. Dissertation – projectsparadise.There is no contribution of employers in the decision of one’s investment in life insurance. which are relatively new entrant in the market. 14% people invest in life insurance as per the family decision. Now let’s find out what people have to say: Type of policy Term Assurance Whole Life Endowment Combined ULIPs TOTAL N0. 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 This is another crucial question as there are number of products offered by life insurance companies. The products range from pure Term Assurance Plans to Unit Linked Insurance Plans. Q.4.
Q.com 87 . It gives people double advantage.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. Dissertation – projectsparadise.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. Projects. Thesis. for instance 20 years. It is the main theme of this questionnaire. and after that period the risk cover continues and the rest of the amount would be paid when the person dies. The person would get some amount at the end of the stipulated period.
Projects. Reliance Life Insurance Company Limited is newly launched company. So it has fewer customers as compared to LIC. Now let’s see what people say: Particulars Reliance Life Insurance LIC TOTAL No. But after the entry of private players in 2000.Prior to 2000 LIC was the only player in the life insurance market and it had the total market. 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. some people have also turned to private life insurers.com 88 . So people had to go to LIC for buying life insurance policy. Thesis. But the ULIP plans are sold more of Reliance life insurance as compared to LIC in today’s environment. Dissertation – projectsparadise.
5 30 15 50 Projects. Thesis.com 89 . Dissertation – projectsparadise.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.
com 90 . and remaining 30% people are aged between 51 to 65. Out of which 10% people are aged between 18 to 30. Thesis. Dissertation – projectsparadise.18 to 30 31 to 50 51 to 65 As evident from the chart that I have taken a sample of 50. Projects. 60% people are aged between 31 to 50. 2) Occupation (a) Service (b) Business (c) Profession (d) Housewife (e) Retired Occupation No.
00.000 Projects.com 91 . 20% are of professions.00. Dissertation – projectsparadise.00. 10% are of housewives and remaining 30% are of retired. 3) Income (a) 50.000 to 1.00.000 (c) More than 5.000 (b) 1. 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.000 to 5.
000 to 1.00. 50.000 1.000 1.00.000.00.000 to 5.Income (Per Annum) No.000 More than 5.000 to 5.00.000 to 5.00.00.000 More than 5.00. Thesis. 4) Family members (a) 2 (b) 3 (c) 4 (d) More than 4 Projects.00.000 to 1.000 to 1. 50% are earning between 1. Dissertation – projectsparadise.000 TOTAL 50.00.000 10 25 15 50 As the evident from the chart out of 50 respondents 20% are earning annually between 50.00.00.000.00.000 and 30% are earning more than 5.com 92 .
30% have 3 family members. which have impact on the survival of any organization. 40% have 4 family members and remaining 20% have more than 4 family members.com 93 . 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. Thesis. Now let’s make SWOT analysis for reliance Life Insurance Company Limited. Projects.Family Members No. 6. Dissertation – projectsparadise.6 SWOT ANALYSIS SWOT analysis is the analysis of the internal and external factors.
10.com 94 .☻STRENGTHS: 1) Reliance Life Insurance Company Limited is the part of the Reliance Capital. so people seems it risky. Dissertation – projectsparadise. 3) Private placement of Rs. Led to an improvement in market securities. 2) Lack of staff.000 crs worth of securities with RBI by the government. 2) The brand name is enough to sell the products easily. 5) Range of products 6) Reliance has a long and strong history of solvency. Projects. Thesis. financial stability. 4) Strong liquidity from FII was the major reason for the up move. ▼WEAKNESSES: 1) Newly established company.
2) Intention of traditional products is to encourage long term. So it has large potential. so most of the customers are not aware of the Reliance Life Insurance. ● THREATS: 1) The main threat is from the other players who have grabbed approximately 15% of the market share. the people who used to invest in life insurance for the sole motive of tax benefit may turn to other instruments. regular and disciplined savings to systematically build up a target fund.5%. CHAPTER – 7 FINANCE DEPARTMENT Projects. Thesis. ☼ OPPORTUNITY: 1) There is a vast untapped market in India. Dissertation – projectsparadise. The life insurance penetration in India is approximately 2.3) Lack of advertisement.com 95 . 2) As the government has scrapped the rebate on the life insurance premium. 3) The average insurance premium being collected by the company has been growing exponentially year on year.
Thesis.com 96 . Dissertation – projectsparadise. which Reliance Life Insurance Company Limited has offered. which are as follows: Projects.FUND PERFORMANCE:- There are four fund options.
com % of total assets 38.’06) Net Returns since Inception in Feb’03 (Annualized) 0. and Reliance Market Return Plan.75% GOI 2006 Projects.96 97 .09% 3.4% 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. In line with the objective of protecting the capital against any erosion.75% GOI 2006 11.75 13.69 40.1) Capital Secure Fund:This fund is for Reliance Golden Years Plan. 61.36% 1. Dissertation – projectsparadise.68% GOI 2006 11.60 6. Net Returns during last 1 month (Mar. Thesis. The net return credited to policyholders and the asset composition ratios are given in the boxes below.89% Bank Fixed Deposits Asset Name Total Bank Deposit Gilts 6.10% 4.’06) Net Returns during the last 12 months (Apr.’05-Mar.’06) Net Returns during the last 3 months (Jan.-Mar.
com 2.’06) Projects.40 100. All the bonds in the portfolio are top rated. Dissertation – projectsparadise. To reflect their bearish view on the debt market the duration of the fixed income portfolio was kept low. allocation to Gilts was higher than corporate bonds. Thesis. the equity holdings in the fund was maintained as close as possible to the maximum of 20% allowed for the fund. Within the fixed income portfolio. and Reliance Market Return Plan. To take advantage of the bullish trend in the equity market. Bank deposits were maintained only for the purpose of liquidity management.00 Asset Allocation:- Gilts Bank Deposits 2) Balanced Fund:This fund is for Reliance Golden Years Plan. The asset composition.Total Gilts Total 61.47% 98 . the details of the portfolio and the net returns are disclosed below. Net Returns during last 1 month (Mar.
00 Equity Corporate Bonds & Debentures Gilts Bank Deposits 3) Growth Fund:- Projects.07% 13. Thesis.’05-Mar.com 99 .83% 13.-Mar.’06) Net Returns during the last 12 months (Apr.Net Returns during the last 3 months (Jan. Dissertation – projectsparadise.10% Asset Name Equity Corporate Bonds & Debentures Gilts Bank Deposits Total % of Total Asset 20 22 53 5 100.’06) Net Returns since Inception in Feb’03 (Annualized) 4.
All the bonds in the portfolio are top rated. To take advantage of the bullish trend in the equity market.99% 24. the details of the portfolio and the net returns are disclosed below.-Mar.’06) Net Returns during the last 12 months (Apr. 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.04% Asset Name Equity Corporate Bonds & Debentures Gilts Bank Deposits Total % of Total Asset 9 40 45 6 100.90% 21.’05-Mar.’06) Net Returns since Inception in Feb’03 (Annualized) 4. Net Returns during last 1 month (Mar.’06) Net Returns during the last 3 months (Jan.60% 7. To reflect their bearish view on the debt market the duration of the fixed income portfolio was kept low. Dissertation – projectsparadise.com 100 . and Reliance Market Return Plan.00 Projects. The asset composition. Thesis.
the entire corpus of the fund was invested in equities.com 101 . Dissertation – projectsparadise. In line with the stated asset allocation pattern and their view of the market.’06) Net Returns since Inception in Feb’03 (Annualized) 11. Net returns earned since inception and the full portfolio are disclosed below.’06) Net Returns during the last 3 months (Jan. Net Returns during last 1 month (Mar.83% Projects. Thesis.02% 64.18% 20.46% 57.’06) Net Returns during the last 12 months (Apr.-Mar.Equity Corporate Bonds & Debentures Gilts Bank Deposits 4) Equity Fund:This fund is for Reliance Market Return Plan.’05-Mar.
93 1.07 100.Asset Name Equity Mutual Fund/Bank Deposits Total % of Total Asset 98. Thesis. Dissertation – projectsparadise.com .00 Equity Mutual Fund/Bank Deposits CHAPTER – 8 102 Projects.
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
com 106 .Life Time Magazine of Reliance Life Insurance Net Bios Computer Academy’s Life Insurance Book Broachers of Reliance Life Insurance CHAPTER – 10 ANNEXURE Projects. Thesis. Dissertation – projectsparadise.
Questionnaire Survey by student of R.com 107 .C. On Life Insurance NAME: ___________________________________________ Q.1 What is your main motive behind investing in life insurance? (a) Tax Benefit (b) Savings (c) Risk Cover Projects.K. Thesis. Dissertation – projectsparadise.B.M.
(d) Return/Yield Q. Dissertation – projectsparadise. 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.5 Would you prefer Reliance Life Insurance or LIC for buying the life insurance policy? (a) Reliance Life Insurance (b) LIC Projects.com 108 .4.2 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.
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. Dissertation – projectsparadise.
Thesis.(c) Profession (d) Housewife (e) Retired 3) Income (a) 50. Dissertation – projectsparadise.com 110 .00.00.000 (b) 1.00.00.000 (c) More than 5.000 to 1.000 to 5.000 4) Family members (a) 2 (b) 3 (c) 4 (d) More than 4 Projects.
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