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A Study of Consumer Behaviour in Relation to

Insurance Products in Star Union Dai-chi

Prepared for

Pune Office

Prepared By:
MBA (141105)

Asms Institute of Business Management and Research,Pune .

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DECLARATION

I, Mr. Ankit Kankar, hereby declare that this project report is the record of authentic
work carried out by me during the period from 20nd May, 2014 to 30th July, 2015, and
has not been submitted to any other University or Institute for the award of any
degree / diploma etc.

Signature
Name of the student: Ankit Kankar
Roll No. 141105
Date:

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Certificate from Industry Guide


This is to certify that Mr. Ankit Kankar a student of the Post-Graduate Degree In Masters
Of Business Administration ( Marketing ) has worked in our organization on a project
assigned by us. To the best of our knowledge, this report is a product of the students own
effort on the project conducted under our guidance and supervision.

Organizational Guide
Designation
Organization
Address
Date

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Certificate from Faculty Guide


This is to certify that Mr.Ankit Kankar, a student of the Post-Graduate Degree in Masters
OF Business Administration, has worked under my guidance and supervision. This
Summer Project Report has the requisite standard and to the best of our knowledge, no part
of it has been reproduced from any other summer project, monograph, report or book.

Faculty Guide: Sunita Walvekar


Designation
Organization
Address
Date

Table of Contents
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Chapter No.

Title

Page No.

INTRODUCTION

10

1.1

EXECUTIVE SUMMARY

12

1.2

HISTORY OF INSURANCE

13

1.3

INDUSTRY BACKGROUND

15

1.4

A BRIEF HISTORY OF INSURANCE SECTOR IN INDIA

16

1.5

INSURANCE SECTOR REFORMS

18

1.6

INDIAN INSURANCE MARKET

19

COMPANY PROFILE

22

2.1

ABOUT STAR UNION DIA-CHI LIFE INSURANCE

23

2.2

24

2.3

ABOUT THE SPONSORS OF STAR UNION DIA-CHI


LIFE INSURANCE
COMPANYS VISION, MISSION AND VALUES

2.4

PRODUCTS OFFERED

29

2.5

HISTORY & AWARDS OF THE ORGANIZATION

30

DESCRIPTION OF BUSINESS PROBLEM

32

3.1

DESCRIPTION OF WORK ASSIGNED

33

3.2

DESCRIPTION OF WORK CARRIED OUT

36

CONCLUSION AND RECOMMENDATIONS

45

4.1

OBSERVATION AND LEARNINGS

46

4.2

CONCLUSIONS

48

4.3

RECOMMENDATIONS/SUGGESTIONS

49

4.4

BIBLIOGRAPHY

50

4.5

ANNEXURE

51

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26

List of Tables

(To be written sequentially as they appear in the text)


Table No.

Title

Page No.

3.2.12

SUGGESTIONS FOR BETTER PRODUCTS

43

3.2.13

SUGGESTIONS FOR BETTER FUNCTIONING

43

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List of Charts

Chart No.

Title

Page No.

1.6.1

LIFE INSURANCE DENSITY

19

1.6.2

MARKET SHARE OF INSURANCE


COMPANIES

20

3.2.1

GENDER OF RESPONDENT

37

3.2.2

AGE OF RESPONDENT

38

3.2.3

OCCUPATION

38

3.2.4

SOURCE OF KNOWLEDGE

39

3.2.5

POSSESSION OF POLICY

39

3.2.6

REASON FOR NOT POSSESSING POLICY

40

3.2.7

COMPANY WHOSE PRODUCTS ARE


PURCHASED

40

3.2.8

MOTIVATION TO BUY FROM THAT


COMPANY

41

3.2.9

CUSTOMER OF STAR UNION DIA-CHI

41

3.2.10

REASON FOR NOT BUYING STAR UNION


DIA-CHI PRODUCTS

42

3.2.11

REASON FOR BUYING STAR UNION DIA-CHI


PRODUCTS

42

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LETTER OF TRANSMITTAL

Mrs. Sunita walvekar


Star Union Dia -chi Life Insurance

Dear Maam,
As discussed in May 2015, Im submitting the report titled A study of Consumer Behaviour
in Relation to Insurance Products in IDBI.
This report focuses on bringing into light the attitude of current as well as future consumers
of Star Union Dia chi life insurance towards the insurance products offered by the company.
I hope you find this report satisfactory.
Yours sincerely,
Ankit Kankar
Asms Institute of Business Management and Research,
Pune .

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ACKNOWLEDGEMENT

I would like to take this opportunity to express a deep sense of gratitude to my industry
mentors Mrs. Sunita Walvekar Star Union Dia-chi Life Insurance, for giving me proper
directions from time to time and constant words of advice and her support and guidance
during the course of the project.
I would also like to express my thankfulness to my Course Coordinator, Prof. Rakesh Bhati,
for his encouragement during the different phases of the project. Also, I would express my
gratefulness to Prof. Ajit Bodge my project guide from Asms IBMR, for sharing his
thoughts with me regarding the betterment of the project.

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CHAPTER 1- INTRODUCTION

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Life is full of risk and uncertainties. Since we are social human beings, we have certain
responsibilities too. Indian consumers have big influence of emotions and rationality on their
buying decisions. They believe in future rather than present and desire to have a better and
secured future. In this direction life insurance services have its own value in terms
of minimizing risk and uncertainties. Indian economy is developing and having huge middle
class societal status and salaried persons. Their money value for current needs and future
desires generate the reasons behind holding a policy. An attempt has been made in this report
to study the buying behaviour of consumers towards life insurance services.
Analyzing consumer behaviour is perceived as cornerstone of a successful marketing
strategy.
Consumer behaviour is a mental and emotional process and the observable behaviour of
consumers during searching, purchasing and post consumption of a product and service.
Similarly consumer behaviour is action and decision process of people who purchase goods
and services for personal consumption. Now if these defining criteria are closely observed, it
is evident that analyzing consumers decision making process is the foundation of entire
notion of consumer behaviour.

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1.1 EXECUTIVE SUMMARY

A Study of Consumer Behaviour in Relation to Insurance Products in Star Union


Dia-chi

Ankit Kankar
Asms Institute of Business Management and Research, Pune -19

July 30th, 2015

Influencing the ways that people act in their daily consumption lives is a concern for
researchers in a number of disciplinary areas, including consumer behaviour psychology,
sociology and marketing.
This project is focused on analyzing the Internal and the External factors which aim at
determining the customers buying behaviour towards insurance products of Star Union Diachi . It is mainly focused in trying to understand the various factors responsible for the
buying decision. Understanding these factors is a critical task. The purchase decision in
general is prompt by number of factors viz. Psycho graphical, Economical, Socio Political,
Legal and Demographical. There are certain other factors which need to be understood while
keeping in mind the investment decisions made by customers, such as, Customer Buying
Behaviour, Customer Preferences and Perception, Brand Loyalty etc.

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1.2 HISTORY OF INSURANCE

In some sense we can say that insurance appeared simultaneously with appearance of human
society. In earlier economies, we can see insurance in the form of people helping each other.
For example, if a house is burnt, the members of the community help build a new one. Should
the same thing happen to ones neighbour, the other neighbours must come to help.
Otherwise, neighbours will not receive help in the future. Insurance in the modern sense,
started as a methods of transferring or distributing risk, were practiced by Chinese and
Babylonian traders as long ago as the 3rd and 2nd millennia BC, respectively. Chinese
merchants travelling treacherous river rapids would redistribute their cargo across many
vessels to limit the loss due to any single vessels capsizing. The Babylonians developed a
system which was recorded in the famous Code of Hammurabi, c.1750 BC, and practiced by
early Mediterranean sailing merchants. If a merchant received a loan to fund his shipment, he
would pay the lender an additional sum in exchange for the lenders guarantee to cancel the
loan should the shipment be stolen.
Greek monarchs were the first to insure their people and made it official by registering the
insuring process in governmental notary offices. They invented the concept of
the general average. Merchants whose goods were being shipped together would pay a
proportionally divided premium which would be used to reimburse any merchant whose
goods were jettisoned during storm or sinking of the vessel in the sea. The Greeks and
Romans introduced the origins of health and life insurance c. 600 AD when
they organized guilds called benevolent societies which cared for the families and paid
funeral expenses of members upon death. Guilds in the middle Ages served a similar
purpose.
Before insurance was established in the late 17th century, friendly societies existed in
England, in which people donated amounts of money to a general sum that could be used for
emergencies. Separate insurance contracts (i.e., insurance policies not bundled with loans or
other kinds of contracts) were invented in Greeks rulers in the 14th century, as were insurance
pools backed by pledges of landed estates. These new insurance contracts allowed insurance
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to be separated from investment, a separation of roles that first proved useful in marine
insurance. Insurance became far more sophisticated in post-Renaissance Europe, and
specialized varieties developed. Insurance as we know it today can be traced to the Great Fire
of London, which in 1666 A.D devoured 13,200 houses. In the aftermath of this disaster,
Nicholas Barbon opened an office to insure buildings. In 1680, he established Englands first
fire insurance company, The Fire Office to insure brick and frame homes.
The first insurance company in the United States underwrote fire insurance and was formed
in Charles Town (modern-day Charleston), South Carolina, in 1732.

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1.3 INDUSTRY BACKGROUND

The insurance industry of India consists of 51 insurance companies of which 24 are in life
insurance business and 27 are non-life insurers. Among the life insurers, Life Insurance
Corporation (LIC) is the sole public sector company. Apart from that, among the non-life
Insurers, there are six public sector insurers. In addition to these, there is sole national
reinsurer, namely, General Insurance Corporation of India. Other stakeholders in Indian
Insurance market include Agents (Individual and Corporate), Brokers, Surveyors and Third
Party Administrators servicing Health Insurance claims.
Out of 27 non-life insurance companies, 4 private sector insurers are registered to underwrite
policies exclusively in Health, Personal Accident and Travel insurance segments.
They are Star Health and Allied Insurance Company Ltd, Apollo Munich Health Insurance
Company Ltd, Max Bupa Health Insurance Company Ltd and Religare Health Insurance
Company Ltd. There are two more specialized insurers belonging to public sector, namely,
Export Credit Guarantee Corporation of India for Credit Insurance and Agriculture Insurance
Company Ltd for Crop Insurance.
Insurance penetration of India i.e. Premium collected by Indian insurers is 4.10% of GDP in
FY 2011-12. Per capita premium underwritten i.e. insurance density in India during FY 201112 is US$ 59.0.
The insurance sector in India has come to a full circle from being an open competitive market
to nationalization and back to a liberalized market again. Tracing the developments in the
Indian insurance sector reviles the 360-degre turn witnessed over a period of almost two
centuries.

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1.4 A BRIEF HISTORY OF INSURANCE SECTOR IN INDIA

Life Insurance in its modern form came to India from England in the year 1818. Oriental Life
Insurance Company started by Europeans in Calcutta was the first life insurance company on
Indian Soil. All the insurance companies established during that period were brought up with
the purpose of looking after the needs of European community and Indian natives were not
being insured by these companies. However, later with the efforts of eminent people like
Babu Muttylal Seal, the foreign life insurance companies started insuring Indian lives. But
Indian lives were being treated as sub-standard lives and heavy extra premiums were being
charged on them. Bombay Mutual Life Assurance Society heralded the birth of first Indian
life insurance company in the year 1870, and covered Indian lives at normal rates.
Insurance is an Rs 450 billion industry in India. The life insurance segment writes about 80%
of the overall market value. Indian Insurance market was at its all time high in 2003 with a
growth of about 17.4% over the previous year. Since 2001 Insurance is growing at the rate of
15-20 % annually. The growth in the insurance industry is affected by volatility in real estate
rates, GDP rates and long term interest rates. Fluctuations in exchange rates also affect the
growth in this sector. The gross premium as a percentage of the GDP has gone up from 2.3 in
the year 2000 to 4.8 in 2006. The premium as percentage of the countrys gross domestic
product (GDP) has increased from 4.8 percent in 2006 to 5.2 percent in 2011. Together with
banking services, it adds about 7% to the countrys GDP.
Some of the important milestones in the life insurance business in India are:

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1818: Oriental Life Insurance Company, the first life insurance company on Indian soil
started functioning.
1870: Bombay Mutual Life Assurance Society, the first Indian life insurance company started
its business
1912: The Indian Life Assurance Companies Act enacted as the first statute to regulate the
life insurance business.
1928: The Indian Insurance Companies Act enacted to enable the government to collect
statistical information about both life and non-life insurance businesses.
1938: Earlier legislation consolidated and amended to by the Insurance Act with the objective
of protecting the interests of the insuring public.
1956: 245 Indian and foreign insurers and provident societies are taken over by the central
government and nationalized. LIC formed by an Act of Parliament, viz. LIC Act, 1956, with a
capital contribution of Rs. 5 crores from the Government of India.

Indian Insurance in 21st Century:


2000: IRDA starts giving licenses to private insurers: ICICI prudential and HDFC Standard
Life insurance first private insurers to sell a policy
2002: Banks allowed selling insurance plans. As TPAs enter the scene, insurers start setting
non-life claims in the cashless mode
2007: First Online Insurance portal, www.insurancemall.in set up by an Indian Insurance
Broker, Bonsai Insurance Broking Pvt Ltd.

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1.5 INSURANCE SECTOR REFORMS

Cap on ULIP charges and increase in lock in period:

Restriction on high distribution partner payouts

Reduction in overall contribution of ULIPs to new business premium

Benefit derived by insurers on account of high lapse and hence more surrender
penalty will be significantly impacted due to the cap on surrender charges

Insurers showing profits due to release of lapse reserves will not be able to sustain the
same in the future unless long term operational efficiencies are developed

Registration of Referral Agents:

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There have been a slew of regulations around turnover criteria to be a referral partner
and cap on referral fee income as well as share of income through referral business

Training and tele-callers has been made mandatory

Cost of compliance expected to increase and some referral partners who may have to
apply for Broking licence which could delay insurance distribution operations

Compulsory purchase of annuity in pension plans:

Even in case the policy is surrendered, 2/3rd of accumulated funds will be used to
purchase annuity

Exit option being constrained may have significant negative implications for the
product segment

Guidelines around agents:

Persistency norms- the regulation stipulates a min level of persistency to be achieved


by each licensed agent. This is expected to reduce the agency force in the industry

License renewal- IRDA has mandated a min business requirement norm for licensing
agent. This is expected to reduce part-time agents thus improving customer service

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1.6 INDIAN INSURANCE MARKET

The insurance sector which stood at a strong US$ 72 billion in 2012 has the potential to grow
to US$ 280 billion by 2020. This growth is driven by Indias favourable regulatory
environment which guarantees stability and fair play. This environment has given rise to an
insurance market which encourages foreign investors to tap into the sectors massive
potential. Ever since the Indian government liberalised the insurance sector in 2000 and
opened the doors for private participation, the sector has gone from strength to strength. The
resultant competition has provided the consumer with a never-before-seen range of products
and providers, and also enhanced service levels markedly. The health of the insurance sector
reflects a countrys economy. This sector not only generates long-term funds for
infrastructure development, but also increases a countrys risk-taking capacity. Indias
economic growth since the turn of the century is viewed as a significant development in the
global economy. This view is helped in no small part by a booming insurance industry.

Chart 1.6.1

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Chart 1.6.2- Market Share of Insurance Companies

Industry Dynamics
Factors that influence consistent growth in insurance sector are:

Effective distribution channels The efficiency and cost of the various distribution
strategies used by companies are significant to their success in the insurance business.
This particularly holds true for the retail business.

Focus on overall financial inclusion As time evolves, so must the approach of the
insurance sector in India. The objective of the insurance sector should ideally be to
offer a broader range of activities to a wider populace.

Consumer needs and preferences The growth of Indias insurance industry can be
attributed to product innovation, dynamic distribution channels, and vibrant publicity
and promotional campaigns run by insurance companies. Benefits attached to the
products and the manner in which they are delivered (through various marketing tieups) have helped bring customers and insurance companies closer to each other and
made the latter more relevant.

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Types of Insurances:
Insurance business is divided into four classes:
1.
2.
3.
4.

Life Insurance
Fire
Marine
Miscellaneous Insurance.

Life insurers undertake the Life Insurance business; general insurers handle the rest. The
Business of insurance essentially means defraying risks attached to an activity (including life)
and sharing the risks between various entities, both persons and organizations. Insurance
companies are important players in financial markets as they collect and invest large amounts
of premium in various investment instruments.

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CHAPTER 2- COMPANY PROFILE

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2.1 ABOUT STAR UNION DIA-CHI LIFE INSURANCE

Star Union Dia-chi Life Insurance Co Ltd.


Star Union Dai-ichi Life Insurance Co. Ltd. (SUD Life) is a joint venture (JV) of Bank of
India, Union Bank of India and Dai-ichi Life, a leadinglife insurance company of Japan.
Bank of India and Union Bank are leading Indian public sector banks and have a robust
nationwide network of more than 7800 branches that cater to more than 64 million
customers. Bank of India and Union Bank have sponsored select Regional Rural Banks,
which provide SUD Life access to more than 1564 branches that make life insurance products
available in rural areas.
Dai-ichi Life is the second largest life insurance company of Japan and is one of the top ten
life insurers in the world. Dai-ichi Life was established in 1902 and is a recognized brand
name across the globe. Dai-ichi Life is renowned for sound product knowledge, superior
asset management skills, and strong operational capabilities to manage life insurance
businesses globally.
SUD Life is committed to providing insurance products across various stratas of society and
geographies as per the needs of the customer. At SUD Life, the customer commands topmost
priority.
The promoters of SUD Life have a long-term commitment towards their customers and stake
holders and have earned the trust of 64 million customers. These strengths and values have
been inherited by SUD Life, as we make our way to become the next rising star in the Indian
life insurance business, promising exceptional value to all our stakeholders

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2.2 ABOUT THE SPONSORS OF STAR UNION DIA-CHI LIFE


INSURANCE CO. LTD.

Star Union Dai-ichi Life Insurance Co. Ltd is a joint venture (JV) of Bank of India,
Union Bank of India and Dai-ichi Life, a leading life Insurance company of Japan.

Bank of India

Bank of India was founded on 7th September, 1906 and was


under private ownership and control till July 1969, when it was nationalised along with 13
other banks.
Beginning with one office in Mumbai, and a paid-up capital of Rs.50 lakh and 50 employees,
today the Bank has a strong national presence and sizable international operations. In
business volume, the Bank occupies premier position among nationalised banks.
The Bank has 4,545 branches across India that are controlled through 50 Zonal Offices.
There are 54 branches/offices and five Subsidiaries and one Joint Venture abroad.
The Bank came out with its maiden public issue in 1997 and a follow-on Qualified
Institutions Placement in February 2008. In 1989, it became the first nationalised
bank to establish a fully computerised branch and ATM facility at the Mahalaxmi Branch
in Mumbai. The Bank is also a Founder Member of SWIFT in India. It pioneered the
introduction of the Health Code System in 1982, for evaluating/rating its credit portfolio.
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At present, the Bank has overseas presence in 20 foreign countries spread over 5 continents
with 53 offices including four Subsidiaries, 4 Representative Offices and 1 Joint
Venture, at key banking and financial centres viz., Tokyo, Singapore, Hong Kong, London,
Jersey, Paris and New York.

Union Bank of India

Union Bank of India was founded on 11 November 1919 with


its headquarters in Mumbai, being inaugurated by Mahatma Gandhi, in the year 1921. The
Bank now operates through over 3500 branches across the country and has shown a steady
profit during all 93 years of its operations.
Union Bank has been playing a very proactive role in the economic growth of India and it
extends credit for the requirements of different sectors of economy including industries,
exports, trading, agriculture, infrastructure and the individual segments. Through this
diversified portfolio, resources are mobilized through Current, Savings and Term Deposits
and through refinance and borrowings from abroad. The Bank has a large clientele base of
over 49 million.
On technology front, 100% of the branches are computerized. It has also introduced Core
Banking Solution with connectivity between branches. Many innovative products are
developed using the technology platform to offer an array of choices to customers, adding
speed and convenience to transactions.
Union Bank is backed by a dedicated team of over 31,000 staff, who distinguish themselves
with their customer centricity, willingness to learn and adherence to values enabling the bank
to be recognized as a caring organization where people enjoy their work and relationship with
customers.

Dai-Ichi Life
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Dai-ichi Life Insurance Company Limited was founded in 1902


and is based in Tokyo, Japan. The company is now listed on the Tokyo Stock Exchange, as
one of the worlds largest life insurance companies, with in force premiums of $38 billion and
assets of $379 billion (as on 31st March 2013, on a consolidated basis).
Dai-ichi Life has a rich experience and skill in the life insurance business, especially in areas
such as product development, asset management and underwriting. Dai-ichi" in Japanese
means first, which is derived from its founding philosophy of always putting the customer
first.
The company is internationally active in the life insurance business and asset management
business in 6 countries including India as at March 2014. Since its foundation in 1902, Daiichi has always placed the customer first. This philosophy continues to guide the company as
it moves forward.

2.3 COMPANYS VISION, PHILOSPHY AND VALUES

VISION
To be the Trustworthy Life Long Insurance Partner.

PHILOSPHY
Convert Transactional Relationships Into Subscriptional Relationships

VALUES

Passion Simplicity Integrity


Ambition Humility Innovation

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EXCELLENCE
"In every aspect of work ranging from the in-house training institute to the detailed Personal
Insurance Plan. Star Union Dia-chi is focused on achieving the highest standards of quality
in every aspect of their business".

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HONESTY
"Is the heart of the Life Insurance business? Star Union Dia-chi believes that above all, Life
Insurance is based on trust. Transparency, Dependability and Integrity will form the
cornerstones of the Star Union Dia-chi experience."
KNOWLEDGE
"Is what makes experts. Star Union Dia-chi is focused on the Life Insurance business.
Perfectly combining global expertise with local knowledge, Star Union Dia-chi is the Indian
Life Insurance specialist."
CARING
"For the customer Star Union Dia-chi is redefining the Life Insurance paradigm to focus on
the needs of the customers. The Star Union Dia-chi service process is responsive,
personalized, humane and empathetic."
CULTURE
Our "in house culture recipe" has some of the finest ingredients going into its making. Some
of the more prominent aspects of our culture are stated below:

i. Customer comes first


ii. Do it right the first time
iii. Bias for result oriented action
iv. Financial strength and discipline
v. Clarity of purpose
vi. International quality standards
vii. Inclusive Meritocracy

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viii. Learning opportunities


ix. Fun at work
x. Commitment to published value system

TECHNOLOGY
To monitor and manage its network equipment across 34 sites, Star Union Dia-chi uses
Tulip Proactive Managed CE solution. The solution includes device management, proactive
troubleshooting and notification support. With the implementation of the solution, Star Union
Dia-Chi has reported improvement of network performance and availability, with a faster,
more effective change and configuration management.
PRODUCTS
Every individual has different needs at different stages of life. We at SUD Life recognize
your financial needs and goals, and are committed in helping you meet them, by offering a
wide range of life insurance plans and financial solutions.
We provide a variety of products for needs like Protection, Savings & Investments, Children
Education and Marriage, Retirement, Income generation etc.
We are available at your nearest BOI and UBI branches and also have a team of professional
and dedicated agents and financial planners to assist you in planning your financial goals at
different life stages
And , Groups can be as diverse as employees of an organization, depositors and account
holders of a bank, or members of a cooperative society or even an association.
Group Life Insurance plans at SUD Life offers solutions to you and your members helping
them meet their credit protection and life insurance needs in a hassle-free and cost effective
way securing peace of mind for them and their family members.

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CORPORATE SOCIAL RESPONSIBILITY


1.

SUD Life has inherited the culture of its promoter companies and focused to do
Corporate Social Responsibility (CSR). SUD Life believes that the thrust of CSR and
Sustainability is clearly with an objective to assist in bettering the lives of people by
providing basic necessities as they are affected by unfortunate calamities/situation beyond
control of mankind, without warning and catching them unawares, education and initiatives
to uplift the life of poor and needy people of the Society. The purpose of the CSR activities of
SUD Life is to ensure that the benefit of CSR reaches directly to the people.

2.
SUD Life has planned Corporate Social Responsibility (CSR) activity for F.Y.2014-15 as
under:
a. Natural Disaster Relief
b. Basic Necessities
c. Education
d. Health

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2.4 PRODUCTS OFFERED

INDIVIDUAL PRODUCTS
Every individual has different needs at different stages of life. We at SUD Life recognize
your financial needs and goals, and are committed in helping you meet them, by offering a
wide range of life insurance plans and financial solutions.
We provide a variety of products for needs like Protection, Savings & Investments, Children
Education and Marriage, Retirement, Income generation etc.
We are available at your nearest BOI and UBI branches and also have a team of professional
and dedicated agents and financial planners to assist you in planning your financial goals at
different life stages.

2.4.1. Star Union Dia-chi

Bright Child Plan .


As a parent, your life's dreams and ambitions now revolve around your children.

You want to give them the best that life has to offer- a childhood full of happiness and
love, an education from a premier institute, a grand marriage in the midst of friends
and relatives- you want to help them launch their careers and you want to see them
well settled. Saving and investing money to fund all these goals is important. More
important is ensuring that this money grows, and is available to you in the right
amounts when you need it. SUD Life Bright Child is specifically tailored to meet
these needs with its distinct pay-out structure, crafted to meet the funding needs
related to your child's career and wedding.
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2.4.2.

Star Union Dia-chi Protection Insurance Plan

Your familys security is your prime responsibility. Our protection


solution helps you safeguard your family against unfortunate events in life. Choose our
affordable term plan and ensure that your loved ones are well protected against these
unfortunate events and the possibility of financial strain.

Premier Protection Plan


An affordable term plan to provide financial assistance to your family in
case of uncertainties

Accidental Death and Total and Permanent Disability


Benefit Rider
A Traditional rider, which provides additional protection in case of
unfortunate event of an accident

Family Income Benefit Rider


A Traditional rider, that provides protection in case of unfortunate
demise

2.4.3. Star Union Dia-chi Savings Insurance Plan is a fixed term non-linked participating

plan that provides twin benefits of long-term savings and life cover.
We all save to meet different needs of our lives. Be it buying a

new home, or a dream vacation with your family or funding your


childs education- saving is the first step to your big dream. SUD
Life offers you a bouquet of savings plans to choose from so that
you start planning for your future today.

Guaranteed Money Back Plan

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A savings cum protection plan, which guarantees Money Back after


every five years

Jeevan Ashray
An affordable life insurance plan that assures a steady growth of your
savings

Jeevan Safar Plus


A savings cum protection plan that guarantees 125% Sum Assured and
more

2.4.4 Star Union Dia-chi Wealth Insurance Plan


Two of the utmost priorities in our life are to create wealth and
protect our families against uncertainties. Our wealth plans help you
achieve these goals by investing your surplus money rightly so that you
lead a comfortable life tomorrow.

Elite Assure Plan


A plan that allows you to choose how much supplementary income you need and
for how long.

Dhan Suraksha Plus


A regular premium Unit Linked plan that helps you to build your wealth and
protect your family.

Wealth Builder
A Unit Linked plan that gives you protection and wealth with one time
investment.

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2.4.5 Star Union Dia-chi Retirement Plan


One of our major worry is whether we will be able to live the same life,
without any compromises, even after our retirement. Opt for our
retirement solutions today to lead a comfortable retired life tomorrow.

Assured Income Plan


A Non-Linked Non-Participating Guaranteed Return Endowment Assurance Plan

Immediate Annuity Plus


An annuity plan, which offers you regular stream of income for life

GROUP PRODUCTS
Groups can be as diverse as employees of an organization, depositors
and account holders of a bank, or members of a cooperative society or
even an association.
Group Life Insurance plans at SUD Life offers solutions to you and your
members helping them meet their credit protection and life insurance
needs in a hassle-free and cost effective way securing peace of mind
for them and their family members.
2.4.6 Star Union Dia-chi Credit Life Plan

The Credit life insurance plans from SUD Life help you to protect your
family against your loan liabilities. Now you can pass on your legacies
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and not liabilities, as in case of any uncertainties, these plans give you
protection against the risk of liquidating your assets to repay your
outstanding loan or debt.

Loan Suraksha
A plan that protects your family against your loans, in case of
uncertainties.

Shiksha Suraksha 2
A plan that protects your family against the liability of your educational
loan.
2.4.7 Star Union Dia-chi Term Plan
Group term insurance plans of SUD Life provide life cover to groups of
people. These schemes can be administered or taken by employees,
associations, banks, societies etc and offer life cover at an affordable cost.

Group Term Insurance Scheme in lieu of EDLI


A beneficial protection plan for employees under the Employees Provident Fund
scheme.

Group Term Insurance Plus


A Non-Linked Non-Participating Group Term Insurance Product.

Pradhan Mantri Jeevan Jyoti Bima Yojana


One year group term renewable plan

2.5 HISTORY & AWARD & RECOGNIZATION OF THE


ORGANIZATION

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2009:- BOI signs MOU with Union Bank


-BOI - Tripartite MOU with Union Bank & Dia-chi Insurance
International
-BOI, Union Bank and Diachi Sign Joint Venture Agreement To
Establish A New Life Insurance Company In India
-Redhat Award 2009

2010
Customer Showcase Award 2010

2011
India Insurance Award 2011

2012
Excellence in Financial Reporting 2012
Stars of the Industry 2012

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2013
Technology Maturity Award 2013

2014
Excellence in Financial Reporting 2014
Bancassurance Leader of the Year Award 2014

2015
Award for Excellence in HR through Technology
Best Life Insurance Company in Private Sector by AVP news

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CHAPTER 3- DESCRIPTION OF THE BUSINESS PROBLEM

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3.1 DESCRIPTION OF WORK ASSIGNED


A Study of Consumer Behaviour in Relation to Insurance Products in
STAR UNION DIA-CHI
DEFINING CONSUMER BEHAVIOUR:
Consumer Behaviour may be defined as the interplay of forces that takes place during a
consumption process, within a consumers self and his environment.
- this interaction takes place between three elements viz. knowledge, affect and behaviour;
- it continues through pre-purchase activity to the post purchase experience;
- it includes the stages of evaluating, acquiring, using and disposing of goods and services.
The consumer includes both personal consumers and business/industrial/organizational
consumers.
Consumer behaviour explains the reasons and logic that underlie purchasing decisions and
consumption patterns; it explains the processes through which buyers make decisions.
The study includes within its purview, the interplay between cognition, affect and behaviour
that goes on within a consumer during the consumption process: selecting, using and
disposing of goods and services.
Cognition: This includes within its ambit the knowledge, information processing and
thinking part; It includes the mental processes involved in processing of information,
thinking and interpretation of stimuli (people, objects, things, places and events). In our case,
stimuli would be product or service offering.
Affect: This is the feelings part. It includes the favourable or unfavourable feelings and
corresponding emotions towards a stimuli (eg. towards a product or service offering or a
brand). These vary in direction, intensity and persistence.
Behaviour: This is the visible part. In our case, this could be the purchase activity: to buy or
not a buy (again specific to a product or service offering, a brand or even related to any of the
4 Ps).
The interaction is reciprocal between each of the three towards each other and with the
environment.
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Studying consumer behaviour is important because it enables us to better focus our efforts
where we can get the results we want. By understanding consumer behaviour; our business
will provide the consumer with better goods and services. Better goods and services results in
more sales and therefore more profit. Not only is it important to improve goods and services;
it is necessary to know what type of products and what type of service to offer.
Consumer behaviour is strongly tied to their phase in the life cycle. Patterns of spending are
dictated by what is happening at a given time. Younger couples with no children have
different needs than those who have started a family. While teenagers and elderly people have
more discretionary income and can spend more freely.
Knowing this will help us decide who our core customer is. By using this information to
influence buying decisions; we can increase sales.
It is also important to plan marketing strategies that are focused on this group. These
strategies should target our market and focus on niche marketing. Resources should not be
spent marketing to consumers outside of our target.
We will begin to understand our market when we have satisfied certain questions about our
customers. Why do they choose one product over the next? What impact does the role of
culture, education and advertising has on the decision to choose a product? How and why is
the consumer planning to use the product? Why are they loyal to a specific brand? What are
the risks involved in using or switching to our brand?
Having the answer to these questions will help us gain consumer confidence. We may have
the best product, but the consumer does not know this. We will speak to them through our
status in the community, our good-will, our price points and the way our product relates to
them. These factors will help to determine who will become our customers and who won't.
Consumers have needs and wants, and our objective is to identify the need and create the
want. Our ultimate goal is to influence consumer behaviour and convert this into profits for
our company. Businesses that can predict consumer behaviour have the edge over their
competitors. To predict consumer behaviour requires knowledge of the consumers values,
goals and lifestyle. Companies with this asset use it to develop better strategies, and are better
able to win over consumers. Hence, this study is very important.
SCOPE OF STUDY:
The scope of a subject refers to everything that is studied as part of that subject. When we set
out to explain the scope of consumer behaviour we need to refer to all that which forms part
of consumer behaviour.

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Consumer behaviour includes not only the actual buyer and his act of buying but also the
various roles played by different individuals and the influence they exert on the final
purchase decision.
To define the scope of a subject it is important to set parameters or a framework within which
it shall be studied.. This framework is made up of three main sections-the decision process as
represented by the inner-most circle, the individual determinants on the middle Circle and the
external environment which is represented by the outer circle. The study of all these three
sections constitutes the scope of consumer behaviour. Here, we shall dwell on these
constituents of the framework only briefly as they are explained in detail in the following
units.
OBJECTIVE OF STUDY:
The main objective of this project is to study the consumer behaviour and various reactions of
customers with reference to Star Union Dia-chi Life Insurance Co. Ltd. And suggest ways to
improve its marketing efforts.
1.
2.
3.
4.

To study the trends in life insurance market


To study the profile of Star Union Dia-chi s customers.
To study the investors behaviour with respect to Star Union Dia-chi Life Insurnace.
To analyse the investors perception about Star Union Dia-chi .

3.2 DESCRIPTION OF WORK CARRIED OUT

Sample Size: 80 respondents responded to the pre-designed questionnaire.


Period of Study: 60 days (20 May - 30th July, 2015)
Location of Study: Pune and Mumbai, Maharashtra
Methodology:
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Obtaining first hand information by pitching to customers and getting the


survey filled from them about the insurance products of StarUnion DIachi and
acquiring their views and beliefs about overall insurance products and hence
picking up the areas where we are good and also the areas where our way of
working can be improved in order to enhance customer satisfaction and increase
the business.

FEEDBACK FROM RESPONDENTS:


i.

Gender of Respondent

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Gender
45
40
35
30
25
20
15
10
5
0
Male

Female

Chart 3.2.1 Gender of Respondent

ii.

Age of Respondent

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Age
70
60
50

Age

40
30
20
10
0
18-30

31-46

47-53

54-55

Chart 3.2.2 Gender of respondent

iii.

Occupation

Occupation

Students
Professional(Engg./Doc./Law
yer)
Home-maker
Govt./Pvt. Sector
Self Employed

Chart 3.2.3 Occupation


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iv.

How did you come to know about Insurance products?

Source
40
35
30
25
20
15
10
5
0

Source

Chart 3.2.4 Source of knowledge

v.

Do you currently have an Insurance Policy?

Possession of Policy

16

NO

Possession of Policy

64

YES

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10

20

30

40

50

60

70

Chart 3.2.5 Possession of Policy


vi.

If NO, why not?

50
25
%
Chart 3.2.6 Reason for not possessing policy

vii.

If YES, which companys?

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Company
LIC
TATA AIG

SBI LIFE

BAJAJ ALLIANZ

4
4

ICICI Prudential
44

MAX New York


Kotak Mahindra

Star Union Dia-chi


8

Chart 3.2.7 Company, whose Insurance products are purchased

viii.

What prompted you to buy policy from that company?

B
M
P
r
a
y
a
r
s
n
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4
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ip
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2
0

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Chart 3.2.8 Motivation to buy from that company


ix.

Are you a customer of Star Union Dia-chi Life Insurance?

Customer of Star Union Dia-chi

YES
NO

Chart 3.2.9 Customer of Star Union Dia-chi


x.

If NO, why not?

Reason

I am not in the financial condition to invest right now


Reason
I already have 1 or more policies and I am satisfied with them

I get better returns in other policies

0 5 101520253035

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Chart 3.2.10 Reason for not buying Star Union Dia-chi s products

xi.

If YES, what do you like about our policies?

T a x b e n e fi t I s t ag ri ve e g s o m o d e g I t o io s d s rh e o t ru t r tn e s r m , h e n c e i t i s h a s s l e f r e e
Chart 3.2.11 Reason for buying Star Union Dia-chi s products

xii.

What suggestions would you give us to make our products better?

Sr. Number

Suggestion

Number of respondents

1.

Min. Premium amount

16

should be less
2.

Monthly premium payment


option should be available

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18

Table 3.2.12 Suggestions for better products

xiii.

Suggestions for better functioning of STAR UNION DIA-CHI

Sr. Number

Suggestion

Number of Respondents

1.

More marketing/promotions

12

should be done
2.

Policies should have

something unusual, as people


already possess policies from
other companies, so they are
not attracted by yours.
3.

Should open more branches

at remote locations.

Table 3.2.13 Suggestions for better functioning

Limitations of Study:
1. The study was conducted only in the , Pune and Mumbai areas; hence the results
can be biased and hence not exactly accurate.
2. The survey was to be conducted on 100 respondents but due to time constraint and
unavailability of large number of respondents, the survey was filled by 80 people
only.
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3. The survey includes more number of responses of people within the age group of
18-30. Hence, the study may be biased, as, at that age, income is less and people
take life insurance lightly.

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CHAPTER 4- CONCLUSION AND RECOMMENDATIONS

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4.1 OBSERVATION AND LEARNINGS

1. There is a good amount of people in the age group 18-30 who have not
bothered to buy a life insurance policy because they are very sure that
nothing would happen to them as they are fit and fine.
2. People prefer to buy a policy which has less years of premium payment
term.
3. More than life insurance, people are interested in a savings scheme. The
better savings plan they get, the more is their tendency to buy the policy.
4. Very less people are interested in a pure life insurance policy.
5. Tax benefits are also a major factor why people like to buy a policy.
6. Customers are willing to pay through easy payment options such as ECS
and online payment so that their valuable time gets saved.
7. They are interested more in monthly premium payment options rather
than annually or half yearly.
8. Friends and family are major influencers on customers when it comes to
the decision of buying a life insurance policy.
9. LIC is still the market leader in life insurance sector.
10. Brand image and past record of performance are major stimuli in buying
decision.
11.Star Union Dia-chi has limited reach to prospective customers as
compared to other companies.

4.2 CONCLUSIONS
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The Summer Internship project has helped me gain huge practical knowledge
which cant be gained only through books. This experience gave me an
opportunity to learn new things which provided me a peek into the corporate
culture. Being a fresher, I would never be exposed to a corporate environment if
it were not for this project. I thank Star Union Dia-chi life insurance for giving
me the chance to work with them as a summer intern and showing me the path
of knowledge and experience which will help me succeed in my career and
enter into a bright future.

CONCLUSIONS ON CONSUMER BEHAVIOUR


1. While the fresh air of competition in every sector of economy brings in
major changes in consumer expectations, the insurance industry has
experienced a few unique aspects, such as regulation-inspired efforts to
educate insurance buyers and a vast change of skills and capabilities of
the intermediaries involved in the distribution.
2. With respect to life insurance, potential buyers are drivers of buying a
policy for one or more of these 3 major reasons: security of the money
invested, saving for one or more specific purposes and the availability of
tax benefits.
3. The challenge for the insurance companies is to address the motivating
factors of customers and come up with genuine solutions.
4. The potential buyer primarily expects that the saving should be a painless
process and that the money saved should be absolutely safe. The
challenge is to provide not only convenient payment options, but also
mechanisms that could offer some measure of protection and relief to the
customer if he is forced to disrupt the payment arrangement for
unforeseen reasons.
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5. On the issue of customers perception of security of the money invested,


there are 2 important aspects. One is, how the features of the insurance
contract are put across the buyer (whether it is unit linked policy or
endowment oriented); and the second is, how to address effectively, the
question about dependability of the new generation companies that
potential new insurance buyers raise during sales calls. Both, the
insurance companies and the regulator need to address this behavioural
challenge very actively.
6. Customers in major cities appreciate the need for higher level of
insurance cover with reference to their earning stage in working life.
7. Instances of customers requiring agents to arrange for loans against their
policies, or change nominations etc. are rare. Therefore companies need
to gear themselves to provide high service standards directly.
8. One aspect of customer service for new age companies that remains to be
tested widely is the claim payment record.
9. The entry of Pvt. players into insurance sector have expanded the product
segment to meet different level of requirements of customers. It has
brought greater choice to customers.
10.IRDA is also playing a very comprehensive role by regulating norms,
mandatory to private players, which increases confidence of customers in
the private companies.

4.3 RECOMMENDATIONS/ SUGGESTIONS

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1. We need to tap the young crowd in the age group 18-30 and convince
them that buying a life insurance policy is necessary because life is very
unpredictable.
2. More plans should be made that involve less period of premium payment.
3. As friends and family members are major influencers of customers, our
advertisements and promotions should be family and friend-centred.
4. Group insurance policies like full family insurance schemes should be
made.
5. Our reach needs to be increased through social media (Facebook,
Twitter, YouTube campaigns), television, radio, newspapers etc.
6. Our insurance policies should have a range of premiums to suit every
pocket size.
7. In terms of distribution, we should increase the number of marketersmore channels of distribution and more intermediaries.
8. Our advertisements should cover the benefits of our policies and what
differentiates our policies from those of other companies, in brief.
9. Our company should have more offices at smaller towns and uncovered
segments in the cities.
10. Mobile Commerce is the next big thing! We can have a mobile app
where our customers can get all the information related to our products as
well as pay their premiums.

4.4 BIBLIOGRAPHY

www.sudlife.in
www.staruniondia-chi.com/Press/PressRelease

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http://www.insidebusiness360.com/index.php/why-it-is-important-to-studyconsumer-behavior-8478/
http://www.moneycontrol.com/company-facts/
Yogakshema- LIC Handbook

4.5 ANNEXURE

QUESTIONNAIRE
This is a short consumer behaviour survey of insurance products. Please do fill this, so that
we can provide you better products, services and satisfaction.
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Age ____________
Gender
Male ______

Female _________

Occupation : Students _______


Govt./Private Sector _____________
Self Employed _______________
Professional ____________
NRI _____________
Media Person __________
Other ________
How did you come to know about Life Insurance Policies ?

News Paper / Magazines ________


Television _________
Agents/Field Sale Representative _______
Telemarketing ________
Internet ________
Direct Mail _______
Radio _________
Direct sales Executives _________
Friends/ Family _______
Others ___________________________________________

Do you currently have an insurance Policy ?


Yes _____

No _______

If No , Why Not ?

Lack Of awareness _______


Returns are not lucrative enough _____
Not Appointed By Intermediaries ______
Not Affordable ________
Others _____________________________________________________

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If Yes, which company ?


LIC ______
ICICI Prudential _______
Bajaj Allianz _______
HDFC Standard _____
Birla Sun Life insurance _______
TATA AIG _________
SBI Life Insurance _________
Max Life Insurance _________
Aviva ________________
Kotak Mahindra _______________
Star Union Dia-chi _____________
Other ______________________________

What prompted you to buy policy from that company ?

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Brand Image ____


Past record Of performance _____
My friends /acquaintances have bought from there ________
Market guys convinced me to buy ________
Impressed By ADS/ promotion _______
Desire to Buy from a new company ______
Others __________________________________________________