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HDFC STANDARD LIFE INSURANCE COMPANY LIMITED BANKING AND INSURANCE
BY SYBMS 07 ASHFAQ MALIK TABLE OF CONTENTS Part-A……………………………………………………………. page no. Declaration………………………………………………………………..4 Acknowledgement……………………………………………………….5 Introduction of HDFC STANDARD LIFE INSURANCE CO LTD…..6 CHAPTER page no. Marketing…………………………....…………………………………7 • • • Marketing objectives of HDFC STANDARD LIFE…………….....7 Objectives Key growth parameter Vision statement Revenue of past 3 years of HDFC STANDARD LIFE…………...8 Market share of HDFC STANDARD LIFE………………………....9 Sales realization of HDFC STANDARD LIFE……………………..10 Cost analysis ………………………………………………………….11 Marketing plan OF HDFC STANDARD LIFE…………..........11 • • • • • • • • • Marketing mix in insurance industry (7 P’s) Introduction Product………………………………………………………12 Price………………………………………………………….13 Place………………………………………………………….14 Promotion……………………………………………………15 People………………………………………………………...16 Process……………………………………………………….17 Physical distribution……………………………………….17
Market analysis Market segmentation
• • • • •
FIVE C’s The company (HDFC STANDARD LIFE) The customer The competitors The collaborators The context Difference between public and private insurance sector
I ASHFAQ MALIK hereby declare that this “PROJECT REPORT“ is my work, carried out under the guidance of my faculty guide Mrs NEELAM . This report neither full no r in part has ever been submitted for award of any other degree of either this u niversity or any other university.
ACKNOWLEDGEMENT This project has greatly been a collaborative effort. I take this opportunity to thank all who have helped in the preparation and successful completion of this project work.
It gives me immense pleasure to express my deep sense of gratit ude to Mrs NEELAM Faculty Guide , for her valuable guidance and consistent supe rvision throughout the course of my Report.
HDFC STANDARD LIFE INSURANCE COMPANY LIMITED INTRODUCTION HDFC Incorporated in 1977 with a share capital of Rs 10 Crores, HDFC Standard Life insurance is the oldest life insurance company in the world It is the largest insurer in the UK and is the 28th largest company in t he world. It is a joint venture between Housing Development Finance Corporation L imited (HDFC), India’s leading housing finance institution and Standard Life plc , the leading provider of financial services in the United Kingdom. HDFC has since emerged as the largest residential mortgage finance insti tution in the country .In India, the company is marketing life insurance products and unit lin ked investment plans. HDFC operates through almost 450 locations throughout the country with i ts corporate head quarters in Mumbai, India HDFC Standard Life, one of India’s leading private life insurance compan
ies, has revamped its corporate website ((www.hdfcinsurance.com) in line with it s communication philosophy.
MARKETING: Marketing deals with product. A product can be a good, service or an idea. Here as HDFC STANDARD LIFE is an insurance company so the product here is ‘SERVICE’. MARKETING OBJECTIVES OF HDFC STANDARD LIFE: The following are the marketing objectives of HDFC STANDARD LIFE Focus on the productivity of each consultant, corporate or individual, w hile stressing on the quality of proposals Quick roll out of Products Efficiency of Operations Meet Social & Rural sector obligations Increase/improvement in all the key growth parameters KEY GROWTH PARAMETERS: Number of Financial Consultants Number of Policies Gross Premium Productivity - policies per month per consultant Physical points of presence VISION STATEMENT: The the ney, “The
Revenue of past 3 years of HDFC STANDARD LIFE HDFC Standard Life is a coalition company between HDFC and Standard Life Plc.HDF C Standard Life insurance’s revenue has come down from Rs 33.07 crore in the fin ancial year 2007-08 to Rs 27.77 crore in financial year 2008-09The company produ ced sum premium revenue of Rs.5,564.69 crore as opposed to Rs.4,858.56 crore las t year, posting a y-on-y increase of 15%. Its revitalization premium also witnessed an increase of 34% for the economic ye ar as opposed to Rs.2,173.19 crore in the last year. The company’s EPI in regards to retail business grew by 5%. HDFC Standard Life monitors its latest business premium due to EPI, which is est imated by giving only a 10% value to a sole premium strategy. The economic downturn has hit the insurance industry. HDFC Standard Life, one of the largest private insurers in the country, has seen mark-to-market losses of Rs 1,800 crore in their revenue account PARTICULARS MAR 2008 MAR 2007 Revenue Rs 27.77 crore Rs. 33.07 Crore Rs. 25.75 Crore MAR 2006
most successful and admired life insurance company, which means that we are most trusted company, the easiest to deal with, offer the best value for mo and set the standards in the industry . most obvious choice for all”
Analysis: Due to the economic downturn has hit the insurance industry. HDFC Stan dard Life, one of the largest private insurers in the country, has seen mark-tomarket losses of Rs 1,800 crore in their revenue account during the year. Market share : In India there are total 22 insurance companies are existing and the name of few companies and its market shares are listed below: NAME OF INSURANCE COMPANIES MARKET SHARE in % LIC 72.15 HDFC Standard 3.88 ICICI 5.91 Birla Sun life 2.6 Bajaj Allianz 1.62 Tata AIG 1.5 SBI 1.19 AVIVA 1.8 MAX Newyork life 2.4 OM KOTAK 1.9 ING vysya 1.2 AMP SANWAR 1 METLIFE 1.4 OTHERS 1.45
Analysis: The above graph depicts that 72.15 percentage of the market share is acquired by LIC & it is a public Ltd company and 3.88% is acquired by HDFC STANDARD LIFE an d 5.91% by ICICI & rest of the market share is acquired by all other insurance companies in India . Sales of HDFC STANDARD LIFE The HDFC STANDARD LIFE generated Total Premium Income of Rs. 5564.69 crores in F Y2008-09 registering a year-on-year growth of 15%. The growth was primarily driv en by the company’s structured sales processes based on customer needs and their assessments, wide range of product portfolio and diverse distribution network. “The financial year 2008-09 was a defining year with the unfolding of several un expected events - sharp correction in financial markets and a spread of recessio nary trends. These events also had an impact on the Indian life insurance indust ry. HDFC’s new policies issued grew by 16% over the last year. However, given t he uncertainty in the overall scenario, customers have reduced their annual prem ium commitment on new policies. At the same time, existing policies continued to be in force reflected in our renewal premium, which posted a healthy growth of 34%.” PARTICULARS MAR 2004 Net Sales MAR 2008 MAR 2007 MAR 2006 MAR 2005
Growth (%) Net Sales 30689.30
39.95 36.97 81763.46
25.43 10.81 58425.12
Analysis: The sales of HDFC standard life is increasing year by year due to the company’s structured sales processes based on customer needs and their assessmen ts, wide range of product portfolio and diverse distribution network. MARKETING PLAN OF HDFC STANDARD LIFE: The marketing plan specify the details of the strategies adopted to achieve the objectives of the HDFC STANDARD LIFE .The strategies deals with marketing mix i. e., seven P’s Marketing Mix in Insurance Industry (7 P s) INTRODUCTION: Insurance is a financial service for collecting the savings of the publi c and providing them with risk coverage. The main function of Insurance is to provide protection against the poss ible chances of generating losses. It eliminates worries and miseries of losses by destruction of property and death. It also provides capital to the society as the funds accumulated are inv ested in productive heads Insurance comes under the service sector and while marketing this servic e, due care is to be taken in quality product and customer satisfaction. While marketing the services, it is also pertinent that they think about the innovative promotional measures. The Insurance business deals in selling services and therefore due weightage in the formation of marketing mix for the Insurance business is needed The marketing mix includes sub-mixes of the 7 P’s of marketing i.e. • Product, Price, • place, promotion, • people, process & • Physical Distribution. The above mentioned 7 P’s can be used for marketing of Insurance products, in th e following manner: 1. PRODUCT:
An Insurance company sells services and therefore services are their product. HDFC standard life insurance company faces a bigger challenge due to the unique nature of services provided by them. FUNCTIONALITY: HDFC standard life is one of the leading company offering insura nce services to the users. Apart from offering life insurance policies, they als o offer underwriting and consulting services along with it the assistance and ad vice of the agent, the prestige of the company and the facilities of claims and
compensation. . STRATEGIES: HDFC standard life uses various strategies to market their services They try to offer same standardized services to all their customers e.g., a cour ier services They customize the service according to the needs of the customer: e.g., doctors , consultants, etc. BRAND: HDFC standard life also leverages on its brand name gained over the year s. HDFC’s brand name helps in differentiating its service and expressing brands superiority over rival brands. It is natural that the customers expect a reasonable return for their investment and the insurance company wants to maximize their profitability. Hence, while deciding the product portfolio or the product-mix, the services or the schemes should be motivational. SERVICE (PRODUCT): HDFC Standard Life Product portfolio comprises solutions, wh ich meet various customer needs such as Protection, Pension, Savings, Investment , and Health. The company currently has 25 retail and 6 group products in its portfolio, along with five optional rider benefits catering to the savings, investment, protecti on and retirement needs of customers. HDFC Standard Life bouquet of children’s plans includes: Children’s Plan Unit Linked Young Star II Unit Linked Young Star plus II Unit Linked Young Star Champion WARRANTY: These plans offer multiple advantages for the child, such as tax bene fits and long-term financial security. The plan is an affordable means to ensure a child’s security and, apart from the parents, it can also be chosen by the gr and parents or other relatives of the child. However, its greatest strength is t hat company continues to make savings on your behalf, in your absence. The savin gs can be directed 100% towards your policy or 50% towards your policy and 50% w ill be available for the beneficiary’s regular use until the original Maturity D ate. The development of flexible products to suit individual requirements is wha t will differentiate the HDFC standard life from the other also-rans. 2. PRICING: In the HDFC standard life insurance the pricing decisions are concerned with: i) The premium charged against the policies, ii) Interest charged for defaulting the payment of premium and credit facility, and iii) Commission charged for underwriting and consultancy activities. With a view of influencing the target market or prospects the formulation of pri cing strategy becomes significant. In a developing country like India where the disposable income in the hands of prospects is low, the pricing decision also go verns the transformation of potential policyholders into actual policyholders. The strategies may be high or low pricing keeping in view the level or standard of customers or the policyholders. The pricing in HDFC insurance is in the form of premium rates. The three main factors used for determining the premium rates under a life insur ance plan are mortality, expense and interest. The premium rates are revised if there are any significant changes in any of these factors. • Mortality (deaths in a particular area): When deciding upon the pricing strategy the average rate of mortality is one of
the main considerations. The Mortality Charge will apply on the Sum at Risk (SAR = Sum Assured less the Fund Value pertaining to regular premiums). It will be d educted by monthly cancellation of units from the accumulation unit account. The Mortality Charge shall remain guaranteed throughout the policy term. • Expenses: The cost of processing, commission to agents, reinsurance companies as well as r egistration are all incorporated into the cost of installments and premium sum a nd forms the integral part of the pricing strategy. • Interest: The rate of interest is one of the major factors which determines people’s willi ngness to invest in insurance. People would not be willing to put their funds to invest in insurance business if the interest rates provided by the banks or oth er financial instruments are much greater than the perceived returns from the in surance premiums. Price is a relevant differentiator only in two segments - pure term insurance an d in pure annuities. Here too, service delivery and financial strength will need to be present at a minimum acceptable level for price to be a relevant differen tiator. In case of savings oriented products, long term returns generated will be more r elevant than just the price of the product. A focus on generating good investment performance and keeping a tight control on costs will help in generating good long-term maturity value for customers. Norms have been laid down on all of these by IRDA and adhering to these while d elivering good returns will be a challenge. 3. PLACE: The Place Mix has two important dimension/ facets -i) HDFC STANDARD LIFE Managing the insurance personnel, and ii) Locating a branch i.e., No. of branch of HDFC located at different places HDFC STANDARD LIFE MANAGING THE INSURANCE PERSONNEL: Strength of Financial Consultants reported year-on-year growth of 43% to over 2,07,000 in FY2008-09 compared to 1,45,000 last financial year The management of agents and insurance personnel is found significant with the v iewpoint of maintaining the norms for offering the services. This is also to process the services to the end user in such a way that a gap be tween the services- promised and services – offered is bridged over. In a majority of the service generating organizations, such a gap is found exist ent which has been instrumental in making worse the image problem. The transformation of potential policyholders to the actual policyholders is a d ifficult task that depends upon the professional excellence of the personnel. The agents and the rural career agents acting as a link, lack professionalism. T he front-line staff and the branch managers also are found not assigning due wei ghtage to the degeneration process. The insurance personnel if not managed properly would make all efforts insensiti ve. Even if the policy makers make provision for the quality up gradation, the p romised services hardly reach to the end users. LOCATING A BRANCH: HDFC operates through almost 450 locations throughout the country with its corpo rate head quarters in Mumbai, India. HDFC also has an International Office in Dubai, UAE with service associates in K uwait, Oman and Qatar. HDFC is the largest housing company in India for the last 27 years.
While locating branches, the branch manager needs to consider a number of factor s, such as smooth accessibility, availability of infrastructural facilities and the management of branch offices and premises. In addition it is also significan t to provide safety measures and also factors like office furnishing, civic amen ities and facilities, parking facilities and interior office decoration should b e given proper attention. Thus the place management of insurance branch offices needs a new vision, distin ct approach and an innovative style. This is essential to make the work place co nducive, attractive and proactive for the generation of efficiency among employe es. The branch managers need professional excellence to make place decisions pro ductive.
4. PROMOTION: The insurance services depend on effective promotional measures. In a country like India, the rate of illiteracy is very high and the rural econo my has dominance in the national economy. It is essential to have both personal and impersonal promotion strategies. In promoting insurance business, the agents and the rural career agents play an important role. Due attention should be given in selecting the promotional tools for agents and rural career agents and even for the branch managers and front l ine staff. They also have to be given proper training in order to create impulse buying. HDFC standard life insurance follows personal and impersonal promotion strategie s like --------Advertising and Publicity, (sar utha ke jiyo) Organization of conferences and seminar, Competitions like Spell Bee-India Spells 2009’ Exhibitions, Participation in fairs and festivals, Rural wall paintings and Publicity drive through the mobile Publicity van units
That would be effective in creating the impulse buying and the rural prospects w ould be easily transformed into actual policyholders. To maintain the level of demand for product and to be activated considerably in the market HDFC has developed its market by using the above promotion strategies to make a Greater awareness of insurance and the need to have it as a protection tool rath er than as a tax planning measure.
5. PEOPLE: Customer service lies at the heart of modern service industries. HDFC standard life understands the customers better which allows them to design appropriate products. Customer Profile: In HDFC Standard Life customer profiles are maintained through customer data base. The customer is eligible for the policy according to his a ge and his /her investment option. Minimum age is18 and maximum age is 65 years are to be considered. Customer Segmentation: Here segmenting can be done according to the age and Life stages of the customer Customer Buying Patterns: Customers buy according to their convince through onli ne, or through the sales person. If the customer is well educated and he can man age the things through online he will register Himself through online. HDFC standard life being a service industry which involves a high level of peopl e interaction, it is very important to use following resource efficiently in ord er to satisfy customers. --Training, development and strong relationships with intermediaries are the key areas to be kept under consideration. --Training the employees, -- Use of IT for efficiency, both at the staff and agent level, is one of the im portant areas to look into. Customers are likely to be loyal to organizations that serve them well - from th e way, in which a telephone query is handled, to direct face-to-face interaction s. Although the have a nice day approach is a bit corny, it is certainly bette r than a couldn t care less approach to customer relations. Call centre staff and customer interfacing personnel are the front line troops o f HDFC’s and therefore need to be thoroughly familiar with good customer relatio n s practice.
6. PROCESS: The process used by HDFC standard life insurance is very customer friendly. The speed and accuracy of payment is of great importance. The processing method used is easy and convenient to the customers. Installment schemes are streamlined to cater to the ever growing demands of the customers. IT & Data Warehousing used by them smoothen the process flow. IT helps in servicing large no. of customers efficiently and brings down overhea
ds. Technology can either complement or supplement the channels of distribution cost effectively. It can also help to improve customer service levels. The use o f data warehousing management and mining will help to find out the profitability and potential of various customers product segments. Associated with customer service they are a number of processes involved in maki ng marketing effective in an organization e.g. processes for handling cust omer complaints, processes for identifying customer needs and requirements, proc esses for handling order etc HDFC uses very easy method for all the above proces ses
7. PHYSICAL DISTRIBUTION: • Distribution is a key determinant of success for all insurance companies . • Different companies may however choose different channels and different geographies to focus on. The channel options are - tied agency force, corporate agents and brokers and this is an area where different companies will make diffe rent choices. Many companies like HDFC Standard Life are focusing on all channel s whereas companies like Max New York Life are focusing on the tied agency force only. Customer interface will be a key challenge for life insurance companies a nd includes every that interaction that the customer has with the company, such as sales, new business underwriting, policy servicing, premium payments, claim p rocessing and so on. • HDFC STANDARD LIFE has successfully used remote distribution channels su ch as telephone or internet so as to reach more customers and increase profitabi lity. Individual Consultants: 1.Large in number 2.Standardized Requirements Corporate Agents: 1.Smaller in number 2. Differentiated Requirements Brokers… regulations • In India also, banks hope to maximize expensive existing networks by sel ling a range of products. It is anticipated that rather than formal ownership ar rangements, a loose network of alliance between insurers and banks will emerge, popularly known as banc assurance.
Market analysis: Market segmentation: The life insurance and pension business has two distinct c ustomers segments - individuals and corporate. In case of the retail business fo r individuals, the 4 sub-segments are - protection, investment, savings and pens ion. BENEFIT AREA CUSTOMER SEGMENT Protection Investment Savings Pensions Individuals term Assurance Single premium bonds Endowment / Money Back Pensions plans, annuities Corporates Group term Insurance Gratuity Superannuation HDFC Standard Life will seek to be present across all the segments of the market . Individuals Among the retail products for individuals, 1. Pure risk protection products have been introduced in the market. As these pr oducts have no savings component to it, the premiums are very low compared to ot her products. 2. Investment products provide long term investment growth and insurance cover.
This segment is growing rapidly. 3. Savings products like Endowments and Money-Backs provide a combination of pro tection and investment benefits. 4. The last segment of pension includes products that are aimed at offering cust omers an income during their retirement years. GROUP In case of the group business, there are three sub-segments - protection, statut ory savings and pension. Group insurance products are taken to provide low cost life insurance cover to a group of people. Group insurance can be taken to provide low cost life insuranc e cover as part of employee benefit packages to motivate employees or to cover t he housing or vehicle loan given by employer to employee. It can also be used as a substitute for the statutory EDLI subject to approval by the Regional Provident Fund Commissioner. The statutory savings segment essen tially comprises of the gratuity products for companies. The pension segment wil l include products like group superannuation, which will enable a company to ben efit from the actuarial, investment and operational expertise of a specialist co mpany to manage its superannuation funds. FIVE C’s --1. THE COMPANY: Name of company Industry Market share Tag line Founded Founder Key people Competitors
Products Head quarters Branches GROSS PREMIUM INCOME OF HDFC NEW BUSINESS PREMIUM INCOME LIVES COVERED OVER YEAR 2008-09 & policies issued Key strengths
Vision statement -- Insurance -- 3.88% -- sar utha ke jiyo -- 14 August 2000 -- Mr.Hasmukhbhai parekh
-- HDFC STANDARD LIFE INSURANCE
-- Mr. Deepak S Parekh (Chairman) Mr. Deepak M Satwalekar (M.D and CEO) -- LIC ICICI PRUD LIFE INSURANCE Bajaj Allianz TATA AIG --HDFC, HDFC BANK INDIA LTD, Union Bank of India, Indian Bank, Bank of Baroda, Saraswat Bank, Bajaj Capital -- A) individual B) Group C) Other -- Mumbai, India -- 600 branches, almost 730 locations throughout the country -- Rs. 5,565 Crores -- Rs. 2,679.61 Crores 9,59,000 & 1.25 lakh
-- Financial Expertise Range of Solutions Strong Ethical Values --“The most obvious choice for all” 2. THE CUSTOMER: Any person who is interested in investing his/her money for protecting his/her f uture from an uncertain event is the customer of insurance company. Customer Profile: In HDFC Standard Life customer profiles are maintained through customer data base. The customer is eligible for the policy according to his a ge and his /her investment option. Minimum age is18 and maximum age is 65 years are to be considered. Customer Segmentation: Here segmenting can be done according to the age and Life stages of the customer Customer Buying Patterns: Customers buy according to their convince through onli ne, or through the sales person. If the customer is well educated and he can man age the things through online he will register Himself through online.
CUSTOMER SATISFACTION: Customer satisfaction here is measured by the feedback an d mails of the customer from the website (www.mouthshutup.com) The following bar diagram show the level of customer satisfaction with both the companies LIC & HDFCCustomer satisfaction LIC HDFC 167 103
Analysis- Both LIC & HDFC have a good to LIC, HDFC should concentrate more stomer with its product. Other reason a private company even that makes the 3. THE COMPETITORS:
reputation in the market but when compared for fulfilling all the needs & wants of cu is that LIC is a public company & HDFC is difference.
There are total 22 insurance companies in India out of which LIC is the only pub lic Ltd Company & is also very good competitor to all the insurance company. The top ten companies are LIC, ICICI Prudential Life Insurance Co Ltd, HDFC Stan dard Life Insurance Co Ltd, Bajaj Allianz Life Insurance Co Ltd, SBI Life Insura nce Co Ltd, Reliance Life Insurance Co Ltd, Birla Sun Life Insurance Co Ltd, Max New York Life Insurance Co Ltd, Kotak Mahindra Old Mutual Life Insurance Ltd, a nd Aviva Life Insurance Company India Ltd. HDFC STANDARD LIFE faces a very stiff competition with its other players like LI C, ICICI, etc. Some of the competitive features are as follows Large amount of competition (22 players in the market) Other brands are well advertised and have higher recall value LIC is considered a safer option Face competition from banks and mutual funds High premium policies are difficult to market Incorrect perception about private insurance company Short term plans are available only at large premium Lack of awareness about the unit linked funds in the market The market share of HDFC is 3.88% & LIC is 72.08% as LIC is a public company it is the major competitor for all the other 21 insurance company in India. Most of the market concentration is occupied by LIC. 4. THE COLLABORATORS: Joint Collaboration of HDFC and standard life Collaboration of HDFC with Manipal Education HDFC Life insurance has evolved over the period with its start of 10 crores as t he most massive mortgage institution of finance. With thrust for standard life, HDFC is the joint collaboration of HDFC and Standard Life, which are protagonist s in this marketing platform from commendable years of enriching experience. Mor eover to add to its reputation, HDFC Life Insurance was the first company to att ain the license to work in the insurance arena and the rest is history. It has o peration from more than 52 locations. It’s just not about the renowned name of t he company but more of its customer based applications and services that make it bond with the best
HDFC Standard Life, one of India’s leading private life insurance companies, in collaboration with Manipal Education, India’s premier academic and education ser vices provider, has announced the launch a three-month Certificate Programme in Insurance and Management. 5. THE CONTEXT: Control: Some of the main problems in marketing the policies are: Large amount of competition (18 players in the market) Other brands are well advertised and have higher recall value LIC is considered a safer option Face competition from banks and mutual funds High premium policies are difficult to market Incorrect perception about insurance Interested prospects might have a lack of time and postpone investments Customers get defensive if you cold call SUGGESTIONS FOR IMPROVEMENT Advertise about the company and its products – it motivates individuals to purchase insurance Create a positive perception about insurance Speak about the good features a plan offers like high returns, life cove r, tax benefits, indexation, accident cover while prospecting customers Try to sell the product/plan which the consumer requires and not the pla n where the advisors benefit is higher Analysis & interpretation “A SURVEY ON THE LIFE INSURANCE INDUSTRY IN INDIA” AGE GROUP OF SURVEYED RESPONDENTS TABLE 1: Age group No. of Respondents 18 - 25 years 127 26 - 35 years 67 36 - 49 years 46 50 - 60 years 24 More than 60 years 6 CHART 1: Analysis: From the chart above we find that 47% of the respondents fall in the age group o f 18 – 25 years, 25% fall in the age group of 26 – 35 years and 17% fall in the age group of 36 – 49 years. Therefore most of the respondents are relatively young (below 26 years of age). These individuals could be induced to purchase insurance plans on the basis of i ts tax saving nature and as an investment opportunity with high returns. Individ uals at this age are trying to buy a house or a car. Insurance could help them w ith this and this fact has to be conveyed to the consumer. NO. OF RESPONDENTS WHO HAVE LIFE INSURANCE POLICY IN THEIR NAME TABLE 1: Person who have life insurance policy Yes 103 No 167 CHART 1:
ANALYSIS: This graph shows that out ave life insurance policy their name. So there is a hese people. So in future
of total in their very big business
270 respondents only 103 or 38% respondents h name. Rest all don’t have a single policy in scope for life insurance companies to cover t of life insurace will grow further.
SELECTION OF LIFE INSURANCE COMPANIES TABLE 2: LIFE INSURER NUMBER OF RESPONDENT LIC 76 HDFC STANDARD LIFE 08 ICICI PRUDENTIAL OTHERS 11 05
Analysis: In India, the largest life insurance company is Life Insurance Corporation of In dia. It has been in existence in India since 1956 and is completely owned by the Government of India. Today the organization has grown to 2048 offices serving 1 8 crore policies and has a corpus of over 340000 crore INR.
CONSUMER WILLINGNESS TO SPEND ON LIFE INSURANCE PREMIUM TABLE 3: Willingness to spend on Less than Rs. 6,000 Rs. 6,001 - Rs. 10,000 Rs. 10,001 – Rs. 25,000 Rs. 25,001 – Rs. 50,000 premium 41 73 110 41 No. of respondents 15% 27% 41% 15% Percentage
Rs. 50,001 - Rs. 1,00,000 CHART 3:
CONSUMER WILLINGNESS TO SPEND ON LIFE INSURANCE PREMIUM
Analysis: From the graph above, we can clearly see that 41% of the respondents would be wi lling to spend between Rs. 10001 – Rs. 25000 for life insurance. 27 % would be w illing to spend between Rs. 6001 – Rs. 10000 per annum. Only 15% would be willin g to spend more than Rs. 25000 per annum as life insurance premium. We could say that the maximum premium payable by most consumers is less than Rs. 25000 p.a. POPULAR LIFE INSURANCE PLANS TABLE 4: Type of Plan No. of Respondents Term Insurance Plans 105 Endowment Plans 122 Pension Plans 16 Child Plans 8 Tax Saving Plans 19 CHART 4: POPULAR LIFE INSURANCE PLANS Analysis: From the chart given above we can clearly see that 45% of the respondents hold e ndowment plans and 39% of the respondents hold term insurance plans. Endowment p lans are very popular and serve two purposes – life cover and savings. If the policy holder dies during the policy term the nominee gets the death bene fit that is, sum assured and accumulated bonus. On survival the policy holder re ceives the survival benefit with a bonus. A term plan is a pure risk cover plan wherein the insured pays a lower premium for a higher sum assured. AWARENESS OF UNIT LINKED INSURANCE PLANS TABLE 5: Awareness of Unit Linked Plans No. of Respondents Yes 154 No 116 CHART 5: AWARENESS OF UNIT LINKED INSURANCE PLANS
Analysis: From the chart given above we find that 57% of the respondents are aware of unit linked life insurance plans and 43% are not aware of such plans. These plans sh ould be promoted through advertising. The company can advertise through televisi on, radio, newspapers, bill boards and pamphlets to increase awareness
Unit – linked plans are those where the benefits are expressed in terms of numbe r of units and unit price. They can be viewed as a combination of insurance and mutual funds. The number of units a customer would get would depend on the unit price when they pay the premium. When the policy matures the individual gets his fund value. The value of his fund is calculated by multiplying the net asset va lue and number of units held by them on that day.
CHART SHOWING IDEAL POLICY TERM TABLE 6: Ideal policy term 3 - 5 years 51 6 - 9 years 41 10 – 15 years 95 16 – 20 years 38 21 – 25 years 24 26 – 30 years 5 More than 30 years Whole life Policy CHART 6: CHART SHOWING IDEAL POLICY TERM Analysis: From the chart given above it can be seen that 35% of the respondents prefer a p olicy term of 10 – 15 years, 19% prefer a term of 3 – 5 years and 15% prefer a t erm of 6 – 9 years. This means that HDFC SLIC could introduce more plans wherein the premium paying term is less than 15 years. No. of respondents
INTERPRETATION: From the joint plot category we can interpret that people scale the brand in bet ween good and average category. In terms of price HDFC stands at satisfactory p osition. From this survey we could also found that the service provided by HDFC STANDARD LIFE is at good position. In case of quality people have different opin ion some says it is excellent & other says it is average. From the graph it is clear that HDFC STANDARD LIFE has all variety of products.
CONCLUSION: HDFC STANDARD LIFE is one of largest leading company in India. Its market share during the year is 3.88%. Its collaboration is with standard life which is a UK based company & its new collaboration is with Manipal educations. The most uniqu e selling product of the company is ULIPS. HDFC has nearly 600 branches through the country & it has more then 2 lakh financial consultants. It is also kwon for its values & ethics followed by them .According to the survey conducted HDFC ha s good reputation in the market. HDFC Standard Life Insurance was grown a lot through its aggressive mark eting strategies and the growth rate as tremendous, through it is growing faster
it has to work on certain things and maintain the standard. This can be done t hrough introducing more innovative products and recruiting good quality advisors because they are the pillars of the company and it is the most valuable value a dded services that the company is having. Therefore, the best the company can do is giving the customer something, which is little bit different and better than its competitor. The company shoul d also be successful in expressing the extra features, which is given to the cus tomer. The customer should feel that whatever company is giving is something gre at, and no one could ever imagine about it. This feeling makes the customer feel that company is very much satisfying them. In addition, the extra feature given to satisfying is some thing great.
In India most of the people working in Government and Business sector and they d on’t have much financial planning. Another important point is they have good com pensation package. So the company should bring more innovative and should carry out more promotional activities in government fields. Better promotion of unit l inked plans can generate more sales to the company.
DIFFERENCE BETWEEN PRIVATE AND GOVERNMENT INSURANCE SECTOR Private sector insurance Government sector insurance
1.This firm are owned by private owners. 2.The main motive of this organization is to earn profit 3.Banks provides long term insurance to private sectors in order to take care of there assets 4.Private banks are directly or indirectly depended on nationalized banks for gr anting insurance or loans 5. A private insurance company is run by private entities, either individually o r by joint ventures 6. Private Sector Bank -where en employee is generally polite, helpful and works with a sword hanging over his head. Decisions are taken quickly and your work i
s attended promptly. The main owner of this organization is public. The main motive of this organization is public welfare Banks provides short term or as per require insurance policy in order to help th em during occurrence of nature or manmade calamities Public or nationalized banks are self depended for possession of insurance or l oan while a public sector company, or as you say, government insurance company does not have any private owner, instead is owned by the state or say, government In public Sector Bank, the job for the employee is secured and your work may be done if you have good rapport with the staff. The Lower strata employee commands the Senior Manager who is remains a mute spectator to the harrow s faced by the Customer SUGGESTIONS: HDFC STANDARD LIFE INSURANCE COMPANY’s unit linked insurance plans can e ffectively meet the requirements of the customers, because unit linked plans are directly related to the market, so the customers can creates more wealth throug h fund and he can enjoy the tax benefit, and also the insurance cover. The press ure on the sales team would be lessoned by increasing the awareness among the pe ople about the credibility of the companies and need for capitalizing on the var ious insurance plans offered by the private life insurance companies. • As the awareness of insurance is less among the people, its awareness sh ould be creating among the people by conducting stage shows and explaining its n eed and importance. • Insurance should not be considered only as a risk cover element but also as a long term investment • It is also recommended to concentrate to on lower income group people. • More efforts should be taken by the company’s financial consultants to c onvert the leads into policy holder of HDFCSL. • Follow up should be taken and customer relation should be maintained by the inviting the existing customers to the seminars conducted when launching a n ew product or any changes are made to the products or rules to retain them.
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