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Chapter – 1 Profile of the firm/company


1.1 Name of the firm/company – Kotak Mahindra Life Insurance 1.2 Type of organization 1.3 Registered Office – Multinational – 1. Kotak Mahindra Old Mutual Life Insurance Ltd. 9th Floor, Godrej Coliseum, Everard Nagar, Sion (E), Mumbai – 400022 Tel : (022) 66215999 Fax : (022) 66215757, 66215858

2. 5th Floor, H.B.Twin Towers, A-2,3 & 4 Netaji Subhash Place, Wazirpur District Centre, Ring Road, New Delhi – 110034 Tel : (011) 65195000-4 Fax : (011) 2735632


1.4 Nature of the organization -

Insurance sector in India was opened for private players in 2001, because of a huge proportion of India’s population was untapped by Life Insurance corporation of India, well known by its name LIC. Today we have more than 15 insurance layers in India, which are competing for more and more business with approximately equal benefits to policy holders, but with same benefits in different ways. When we have so many options available, then it is very difficult for us to select best plan, which can provide us best benefits. Today India’s Insurance sector with banking sector is adding more than 7.5% to country’s GDP. Out of all players LIC is enjoying more than 60% business alone, but over the time LIC’s business has reduced in percentage terms.


Kotak Mahindra Group

Today, Kotak Mahindra group is one of the well known brands in India. Started in 1985, kotak mahindra group is enjoying a net worth of more than Rs.30000 crore and a leading financial institution of India. Kotak mahindra old mutual life insurance is a joint venture between kotak Mahindra Bank ltd. it’s affiliates and Old mutual plc.


 Cohesive Work Environment – Offers its employees space to grow. 5 .1.1 Vision Kotak Life Insurance hasa deep rooted commitment to improve the quality of life of its customers.  Work With Honour – Honour in every thought.  Increase Customer Value – Building a relationship of mutual trust and benefit to serve the customers”needs perfectly. They aim at improving the long term value in relationships by continuous innovation and improvements. innovate and build a long term career.5 Company’s Vision and Mission- 1. act and deed in order to positively contribute toindividual. employees and stakeholders.5. society and national growth.

they ensure the continued growth and advancement of their employees. 6 .5. trust and loyalty by offering a wide and varied range of innovative and useful insurance solutions. Strengthened by their commitment to professional management.2 Mission They focus on the needs of their customers and create confidence.1.

1.1 Automobile insurance. Some principal subtypes of business insurance are (a) the various kinds of professional liability insurance.1.6. 1. hull war and liability 1.(also known as boiler and machinery insurance or equipment breakdown insurance) insures against accidental physical damage to equipment or machinery.6.4 Builder's risk insurance. Builder's risk insurance is typically written on an "all risk" basis covering damage due to any cause (including the negligence of the insured) not otherwise expressly excluded. Aviation insurance.can be any kind of insurance that protects businesses against risks.6.6 Product Range of the Company- 1.2 risks. also called professional indemnity insurance. known in the UK as motor insurance. deductible.insures against the risk of physical loss or damage to property during construction. 1.6.3 Boiler insurance.insures against hull.5 Business insurance. spares. which are discussed below 7 .6. is probably the most common form of insurance and may cover both legal liability claims against the driver and loss of or damage to the insured's vehicle itself.

although the name credit insurance more often is used to refer to policies that cover other kinds of debt. disability. which bundles into one policy many of the kinds of coverage that a business owner needs. Mortgage insurance (which see below) is a form of credit insurance.insures against accidents.8 Crime insurance insures the policyholder against losses arising from the criminal acts of third parties. drought.repays some or all of a loan back when certain things happen to the borrower such as unemployment.6. 1.6.7 Credit insurance. frost damage.6. 1. and (b) the business owners policy (BOP). hail. insects. For example. in a way analogous to how homeowners insurance bundles the coverage’s that a homeowner needs. or death. or disease.under that name.6.9 Crop insurance "Farmers use crop insurance to reduce or manage various risks associated with growing crops.6 Casualty insurance. Such risks include crop loss or damage caused by weather. 8 . not necessarily tied to any specific property. a company can obtain crime insurance to cover losses arising from theft or embezzlement. 1. 1.

Annuities provide a stream of payments and are generally classified as insurance because they are issued by insurance companies and regulated as insurance and require the same kinds of actuarial and investment management expertise that life insurance requires. Life insurance policies often allow the option of having the proceeds paid to the beneficiary either in a lump sum cash payment or an annuity.6. and may specifically provide for burial. a. The terms of this type of insurance are usually very strict. In that sense. from an underwriting perspective. Therefore it is used only in extreme cases where maximum security of funds is required. In special cases. It is used to protect public funds from tamper by unauthorized parties. funeral and other final expenses.11 Locked funds insurance is a little-known hybrid insurance policy jointly issued by governments and banks. are the mirror image of life insurance.1. 1.10 Life insurance provides a monetary benefit to a decedent's family or other designated beneficiary. they are the complement of life insurance and.6. a government may authorize its use in protecting semi-private funds which are liable to tamper. 9 . Annuities and pensions that pay a benefit for life are sometimes regarded as insurance against the possibility that a retiree will outlive his or her financial resources.

1. 10 .6. travel delay. lost of personal belongings.6. etc. 1.12 Marine insurance and marine cargo insurance cover the loss or damage of ships at sea or on inland waterways. inland marine insurance or boiler insurance. which extends the indemnity to cover loss of profit and other business expenses attributable to the delay caused by a covered loss. Many marine insurance underwriters will include "time element" coverage in such policies. When the owner of the cargo and the carrier are separate corporations. This includes specialized forms of insurance such as fire insurance. 1. but excludes losses that can be recovered from the carrier or the carrier's insurance. personal liabilities. home insurance. etc.. such as fire.15 Travel insurance is an insurance cover taken by those who travel abroad.14 Property insurance provides protection against risks to property.6.13 Mortgage insurance insures the lender against default by the borrower. shipwreck. theft or weather damage. earthquake insurance.1. which covers certain losses such as medical expenses. marine cargo insurance typically compensates the owner of cargo for losses sustained from fire. flood insurance. and of the cargo that may be on them.6.

16 Workers' compensation insurance replaces all or part of a worker's wages lost and accompanying medical expense incurred because of a job-related injury.6.1. 11 .

The company's loss for the reporting half stood at Rs 35 crore against Rs 53 crore a year ago for the same period. The adjusted premium equivalent has grown 119 per cent to Rs 566 crore for the reporting half from Rs 259 crore for the same period a year ago. The Company has recruited high quality manpower and carries out an extensive induction training for its operations and sales staff. Gaurang Shah.1. "Increase in productivity was a sheer focus for this half-year and we have successfully managed to raise the bar. 12 . The Company had 723 employees on its rolls as on March 31. "Higher toplines. TURNOVER ." Kotak Life Insurance Managing Director. said.Kotak Mahindra Old Mutual Life Insurance today said it has posted a 114 per cent growth in first year premium income for the half-year ended September 30. Kotak said in a release. 2003.7 Size in Terms of Manpower and Turnover- MANPOWER . The Company believes that its growth lies in the growth of its employees. reduced costs and better customer service were the focus parameters and we aim to continue with the same objectives.The Company believes that its employees define the organization.

1. – 1 13 .8 Organization Structure of the Company- Figure No.

.9 Market share and Position of the Company- Table No.1.1 14 .

– 2 15 .Figure No.

Andrew Cartwright . G Muralidhar . Anand Dewan .Financial Institutions Group Mr.Head of Tied channel Mr.10 Present LeadershipKotak Life Insurance works as a team and have a flat management structure. Vice President Marketing Mr. Pankaj Desai .Executive Director Mr.Head of Alternate channel Mr.Sr. Sugata Dutta .Appointed Actuary Mr.Head Human Resources Ms. Elizabeth Venkataraman .Managing Director Mr.1. Subhasish Ghosh . Suresh Agarwal . Gaurang Shah .Chief Operating Officer Mr. Shekhar Bhandari .Head Management Development Training 16 . Their top management has many years of experience which has helped guide the company into a position of leadership • • • • • • • • • • Mr.

17 .1.11 Source of Data Collection- • Primary Data – The primary data was collected through internship experience in the organization itself and some paper conversation. • Secondary Data – The secondary data was collected through magazines and online research material including websites.

Chapter – 2 SWOT Analysis of the company 18 .

Threats and Opportunities leading to gauging the competitive potential.1 SWOT Analysis SWOT analysis is done for a company. and a strong track record in managing funds .1 Strengths • Financial Acumen .Known for being an innovator in providing world-class pragmatic financial solutions. The SWOT Analysis enables a company to recognize its market standing and adopt strategies accordingly.Holds a stable and diversified portfolio and has received some of the highest ratings in financial strength from industry’s independent rating agencies. Weaknesses.2.1.a major differentiator 19 .backed by the acclaimed expertise of Old Mutual plc • Innovativeness .A highly committed sales force. 2. with customer satisfaction as the key driving force .Years of experience in asset management. to find out its overall Strengths. with a constant focus on customization and flexibility • Unrelenting Customer Focus . • Disciplined fund management .

2 Weaknesses • • • • • • • Industry in nascent stage. » Plan does not offer any guarantee or assured return. well regulated asset management. Lack of credibility among the people because Kotak being a private player. management and administrative charges are sky scrapping as compared to its competitors. regular performance benchmarking. Rural areas still not covered.1. 20 .• Transparency in Services . Products: » The policy doesn’t have the surrender option before third year. » Mortality. » Product profile is not very comprehensive.Daily declaration of fund performances. and monthly newsletter on market updates 2. Not very known among Indian population. Premiums are high as compared to its competitors. Very few branches in the country.

The whole private sector is opened to be trapped even though the competition is fierce from government owned insurance companies. As the industry is growing the whole market is virgin. 2.2.3 Opportunities • • • Liberalization of Indian economy. • It’s a volume business that is even if the company has few good corporate the turnover cease to increase by manifold. Apprehension towards Kotak being a private life insurance company.4 Threats • • • The government players will become aggressive thus growth is going to be tough. Entry of other players is not ruled out. 21 . » Finance minister unveiled a budget favoring consumer spending. • Products: » Preserver funds look good due to comfortable liquidity in the economy and there is little chance hike in short-term rate by RBI. boosting demand and therefore higher economic growth.1.1.

22 . which will impact the industry and Kotak life fortunes. • Products: » Past performance of these plans is not indicative of the future performance of the plan. » The sum invested in the funds is subject to market risks and there can be no assurance that the objective of plan will be achieved.• We expect the industry to rationalize in future that is mergers and acquisitions will happen.

distribution and selling.2. 2. whose methods can be improved using a variety of relatively new approaches. Seen from a systems point of view. It is also concerned with anticipating the customers' future needs and wants.2 Human Resource : In pursuance of strengthening the human resources of the Kotak Mahindra Life Insurance. sales process engineering views marketing as a set of processes that are interconnected and interdependent with other functions. money and risk and how they are interrelated.2 Best Practices of the company 2.3 Finance : The field of finance refers to the concepts of time.2. which includes advertising.2.1 Marketing : Marketing practice tends to be seen as a creative industry. a comprehensive induction plan for recruiting professionals with specialized qualifications and back ground was embarked upon. Banks are the main facilitators of funding through the provision of credit. although private 23 . 2.2. which are often discovered through market research.

and other organizations have become important. mutual funds. Customer centric organizations will: 24 . including debt such as bonds as well as equity in publicly-traded corporations. 2. hedge funds.4 Services : Customer satisfaction refers to how satisfied customers are with the products or services they receive from a particular agency.equity. Financial instruments allow many forms of securitized assets to be traded on securities exchanges such as stock exchanges. planning and service delivery. Kotak Mahindra with a strong customer service culture places the customer at the centre of service design.2. The level of satisfaction is determined not only by the quality and type of customer experience but also by the customer’s expectations.

25 .2 USPs of the company Kotak Mahindra Life Insurance is the only company to reach Break-Even Point with a profit of about 1400 Crores even at the time of recession with a number of competitors both private and public including Bajaj Allianz. LIC. COMPANY STRATEGY: Now company applies the project “Turning Point” and in this project to decide the selection criteria for LIFE ADVISOR and life advisor is the basic requirement for sale the policy. 2. to perform productive” so as to reduce the cost.2. Metlife and other huge players in the insurance sector. The reason behind this success was the SALES STRATEGY of the company which includes the following two types of strategies : further 1. EXTERNAL STRATEGY: Kotak life insurance external strategy is “To make limited branches but.

Chapter – 3 Analysis of Financial Reports of the company 26 .

12:1 For the year 2010 = 3905.88 = 0.71 28312. Proprietary Ratio = Shareholder’s Funds Total Assets For the year 2009 = 3593.Analysis of Financial Statements (Accounting Ratios) (All amounts in Rs.13:1 27 . Crores)  Proprietary Ratio .It highlights the general financial position of the enterprise and shows the extent to which the shareholders own the business.53 28711.36 = 0.

Proprietary Ratio Year 2010 2009 0.13 Proprietary Ratio Figure No.3 This ratio has increased in comparison to the previous year which means that there is adequate safety for creditors and hence results in higher Return on Investment.12 Fraction 0.11 0. 28 . .

71 = 5.53 = 5.00 3905. Debt – Equity Ratio – It is computed to ascertain the long-term financial position of the firm. Debt – Equity Ratio = Debt Equity For the year 2009 = 21542.5:1 29 .90 3593.9:1 For the year 2010 = 21549.

It implies the use of more equity than debt leaving a larger safety margin for the creditors.9 5.6 5.3 Debt-Euity Ratio 2009 2010 Year Figure No. 30 .5 5.4 5.7 Fraction 5.4 A minor decrease in the ratio indicates a safe financial position.8 5. .Debt-Equity Ratio 5.

 Return on Capital Employed – It judges the overall performance of the enterprise i.10 X 100 3905. it measures how efficiently the sources entrusted to the business are used..71 % For the year 2010 = 276.71 = 8.93 X 100 3593. Return on Capital Employed = Net Profit before Tax X 100 Capital Employed For the year 2009 = 293.53 = 7.e.06 % 31 .

Return on Capital Employed 7.5 The ratio has decreased in comparison to the previous year but on a small margin thereby indicating satisfactory performance of the company. .06 8.71 2009 2010 Figure No.. 32 .

11 X 100 3593.53 = 20.71 = 18.27 X 100 3905.59 % 33 .03 % For the year 2010 = 804. Return on Equity – It is used to find out how efficiently the funds supplied by shareholders have been used. Return on Equity = Net Profit after Interest and Tax X 100 Shareholders Funds For the year 2009 = 648.

.59 Figure No. . the firm has the ability of generating profit per rupee of shareholder’s funds. 34 .03 20.6 An increase in the ratio indicates efficient management and utilization of shareholder’s funds i.e.Return on Equity 2009 2010 18.

It measures the safety margin available to the providers of long-term debts.33:1 35 . Total Assets to Debt Ratio = Total Assets Debt For the year 2009 – 28312. It measures the extent to which debt is covered by assets.88 21549 = 1.31:1 For the year 2010 – 28711.36 21542.90 = 1. Total Asset to Debt Ratio .

36 .31 2009 2010 Figure No.Total Assets to Debt Ratio 1. -7 An increase in the ratio represents higher security to the lenders for extending long-term loans to the business.33 1.

88 = 2. Return on Total Assets . Return on total Assets = Net Profit after Tax X 100 Total Assets For the year 2009 = 648.80 % 37 .28 % For the year 2010 = 804.36 = 2.27 X 100 28711.11 X 100 28312.It is used to ascertain whether the investment in assets have generated adequate net profit.

5 1 0.5 2 Percentage 1.5 0 Return on Total Assets 2009 2010 Year No. Analysis of Cash Flow Statement 38 .Return on Total Assets 3 2. -8 Figure A higher ratio reflects efficiency of the management in generating adequate net profit by investment in assets.

80 (964.78) 853.33) 2105 1140.40) (35. in Crores) March’09 Net cash from operating activities Net cash used in investing activities Net cash used in financing activities Net increase/decrease in cash and equivalent Cash and equivalent begin of year Cash and equivalent end of year (655.15) (95.71) (180.Cash Flow Statement (Rs.66) 1689 March’10 (833.67 Comments 39 .19 1278.61 2131.

there is a marginal increase in the closing balance of cash and cash equivalents that has helped the company to improve its solvency ratios particularly the debt equity ratio and total assets to debt ratios. the company may have to face liquidity problems as it may be having slow moving stock. 40 . It means Kotak Mahindra has consistently invested in fixed assets. • An increase in cash from financing activities depicts efficient assessment of claims on future cash flows by providers of funds to the enterprise • In the year 2009. It also indicates that the investment in fixed assets facilitates the business to earn more profit in future. In the near future. It is also a healthy sign for any business.• Cash generated from operating activities is negative which isn’t a good sign. • It is observed that the 2 years show negative flow of cash from investing activities.

indicating inefficient cash management. But the company carries unusually high cash and cash equivalents. 41 . -9 On the basis of the above analysis. 1000 Crores) 500 0 -500 -1000 2009 2010 Year Figure No. we may conclude that business of Kotak Mahindra is doing well and prospects of the company are bright. The management must consider this situation and take decision as to cash management so that better standards are achieved.Cash Flow Analysis Operating Activities 2500 2000 1500 Investing activities Financing activities Cash and Cash Equivalents at the beginning Cash and Cash Equivalents at the end Amount(in Rs.

Chapter – 4 Lessons Learnt 42 .

Interaction Good market interaction is needed to capture the market share. it is far easier to re-sell an existing client than to sell to someone who doesn't know and trust you. 2. 4. Practical learning about Insurance industry The internship gave a good understanding of the Insurance Sector and its operations. referrals and relationships with the customers.Learnings in the organization: 1. Maintain Relationships While selling insurance policies. 3. 43 . A business of Relationship Insurance is one business which works best on personal networks. 5. Create a Back-End for Your Business (Cross Selling) It was easier to target an existing client and it turned to be more profitable as compared to targeting a new customer.

6. This makes the company work in a very efficient.  Contribution to the Organization: During my 2 months summer internship at Kotak Mahindra Life Insurance. 44 . Efficiency and Effectiveness This company is utilizing the talents of its employees in a very efficient and effective manner as every person has been assigned different tasks to perform. I worked on the research work involving analyzing the importance of Life Insurance in the present scenario and made efforts to target the particular class of customers with its products and hence contributed in enhancing the business.


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economywatch.htm  http://www. The Economic Times 2. the free Other sources  www. Blogs by admin 47 .com Special Thanks to  Wikipedia.5.