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i 2010

Insurance Broking
Internship Project

Jaspreet Kaur Sethi (4843)
Shaheed Sukhdev College of Business Studies
Delhi University

I would like to express my sincere thanks to Religare Insurance

Broking Ltd., Delhi for giving me the opportunity to carry out the

Summer Internship Program in their organization. The whole period

spent with the organization has been of immense learning experience

about the Indian Insurance Market.

Preparing a project of such a kind is not an easy task in itself and I am

sincerely thankful to all those people who help me lot, in preparing and

completing this project.

I am grateful to Religare Insurance Broking Ltd. who has given me this

opportunity to carry out the project “Understanding the

functioning of an Insurance Broker” .

I sincerely thank to Mr. Gaurav Gupta (ABVP, Religare Insurance

Broking Ltd., Delhi) for providing me this valuable learning


Finally I would like to thank Mr Sumit Verma my project supervisor

without his help and guidance the completion of this project would

have become difficult task.
An overview about Insurance

Everyone is exposed to various risks. Future is very uncertain, but
there is way to protect one’s family and make one’s children’s future
safe. Life Insurance companies help us to ensure that our family’s
future is not just secure but also prosperous. Life Insurance is
particularly important if you are the sole breadwinner for your family.
The loss of you and your income could devastate your family. Life
insurance will ensure that if anything happens to you, your loved ones
will be able to manage financially. This study titled “Study of
Consumers Perception about Life Insurance Policies” enables the Life
Insurance Companies to understand how consumer’s perception differs
from person to person. How a consumer selects, organizes and
interprets the service quality and the product quality of different Life
Insurance Policies, offered by various Life Insurance Companies.

Insurance is a tool by which fatalities of a small number are
compensated out of funds (premium payment) collected from
plenteous. Insurance companies pay back for financial losses arising
out of occurrence of insured events e.g. in personal accident policy
death due to accident, in fire policy the insured events are fire and
other allied perils like riot and strike, explosion etc. hence insurance
safeguard against uncertainties. It provides financial recompense for
losses suffered due to incident of unanticipated events, insured with in
policy of insurance. Moreover, through a number of acts of parliament,
specific types of insurance are legally enforced in our country e.g. third
party insurance under motor vehicles Act, public liability insurance for
handlers of hazardous substances under environment protection Act.

It is a commonly acknowledged phenomenon that there are countless
risks in every sphere of life .for property, there are fire risk; for
shipment of goods. There are perils of sea; for human life there are
risk of death or disability; and so on .the chances of occurrences of the
events causing losses are quite uncertain because these may or may
not take place. Therefore, with this view in mind, people facing
common risks come together and make their small contribution to the
common fund. While it may not be possible to tell in advance, which
person will suffer the losses, it is possible to work out how many
persons on an average out of the group, may suffer losses. When risk
occurs, the loss is made good out of the common fund .in this way
each and every one shares the risk .in fact they share the loss by
payment of premium, which is calculated on the likelihood of loss .in
olden time, the contribution make the above-stated notion of


Insurance has been defined to be that in, which a sum of money as a
premium is paid by the insured in consideration of the insurer’s
bearings the risk of paying a large sum upon a given contingency. The
insurance thus is a contract whereby:

a. Certain sum, termed as premium, is charged in consideration, b.
Against the said consideration, a large amount is guaranteed to be
paid by the insurer who received the premium, c. The compensation
will be made in certain definite sum, i.e., the loss or the policy amount
which ever may be, and d. The payment is made only upon a

More specifically, insurance may be defined as a contact between two
parties, wherein one party (the insurer) agrees to pay to the other
party (the insured) or the beneficiary, a certain sum upon a given
contingency (the risk) against which insurance is required.

Insurance occupies an important place in the modern world because of
the risk, which can be insured, in number and extent owing to the
growing complexity of present day economic system. The different
type of insurance have come about by practice within insurance
companies, and by the influence of legislation controlling the
transacting of insurance business, broadly, insurance may be classified
into the following categories:
1. Classification from business point of view
a) Life insurance
b) General insurance

2. Classification on the basis of nature of insurance
a) Life insurance
b) Fire insurance
c) Marine insurance
d) Social insurance
e) Miscellaneous insurance

3. Classification from risk point of view
a) Personal insurance
b) Property insurance
c) Liability insurance
d) Fidelity general insurance

Insurance benefits society by allowing individuals to share the risks
faced by many people. But it also serves many other important
economic and societal functions. Because insurance is available and
affordable, banks can make loans with the assurance that the loan’s
collateral (property that can be taken as payment if a loan goes
unpaid) is covered against damage. This increased availability of credit
helps people buy homes and cars. Insurance also provides the capital
that communities need to quickly rebuild and recover economically
from natural disasters, such as tornadoes or hurricanes. Insurance
itself has become a significant economic force in most industrialized
countries. Employers buy insurance to cover their employees against
work-related injuries and health problems. Businesses also insure their
property, including technology used in production, against damage and
theft. Because it makes business operations safer, insurance
encourages businesses to make economic transactions, which benefits
the economies of countries. In addition, millions of people work for
insurance companies and related businesses. In 1996 more than 2.4
million people worked in the insurance industry in the United States
and Canada. Insurance as an investment that offers a lot more in
terms of returns, risk cover & as also that tax concessions & added
bonuses Not all effects of insurance are positive ones. The possibility
of earning insurance payments motivates some people to attempt to
cause damage or losses. Without the possibility of collecting insurance
benefits, for instance, no one would think of arson, the willful
destruction of property by fire, as a potential source of money.

Since the 1970s, the insurance business has grown dramatically and
undergone tremendous changes. As a result of the deregulation of
financial services businesses— including insurance, banking, and
securities trading—the roles, products, and services of these formerly
distinct businesses have become blurred. For instance, citizens in the
U.S. state of California voted in 1988 to allow banks to sell insurance
in that state. In Canada, banks may also soon be allowed to sell
insurance. Advances in communications technology have also allowed
traditionally distinct financial businesses to keep instantaneous track of
developments in other businesses and compete for some of the same
customers. Some insurance companies now offer deposit accounts and
mortgages. In the United States, life insurance companies now sell
more pension plans and other asset management services than they
do conventional life insurance. Developments in computer technology
that have given insurance providers the ability to quickly access and
process information have allowed them to custom-design policies to fit
the needs of individual customers. But the increasing complexity of
policies has also made some aspects of buying and selling insurance
more difficult. In addition, improvements in geological and
meteorological technology have the potential to change the way
property insurers calculate risks of damage. For example, as scientists
improve their abilities to predict severe weather patterns, such as
hurricanes, and geological disturbances, such as earthquakes, insurers
may change how they provide protection against losses from such

The marine insurance is the oldest form of insurance. If we trace
Indian history there are evidence that marine insurance was practiced
here about three thousand years ago. The code of Manu indicates that
there was the practice of marine insurance carried out by the traders
in India with those of Sri Lanka; Egypt and Greece .it is wonderful to
see that Indians had even anticipated the doctrine of average and
contribution. Fright was fixed according to season and was then very
much at the mercy of the wind and other elements. Travelers by sea
and land were very much exposed to the risk of losing their vessels
and merchandise because of piracy on open seas and highway robbery
of caravans was very common. The practice of insurance was very
common during the rule of Akbar to Aurangzeb, but the nature and
coverage of the insurance in this period is not well known. It was the
British insurer who introduced general insurance in India in the
modern form. The British opened general insurance in India around
the year 1700 .the first company known as the sun insurance office
was set up in Calcutta in the year 1710. This was followed by several
insurance companies like London assurance and royal exchange
assurance (1720), Phoenix Assurance Company (1782). Etc. General
insurance business in the country was nationalized with effect from 1st
January 1973 by the General Insurance Business (Nationalization) Act,
1972. More than 100 non-life insurance companies including branches
of foreign companies operating within the country were amalgamated
and grouped into four companies, viz., the National Insurance
Company Ltd., the New India Assurance Company Ltd., the Oriental
Insurance Company Ltd., and the United India Insurance Company
Ltd. with head offices at Calcutta, Bombay, New Delhi and Madras,

Life insurance in the current form came in India from united kingdom
with the establishment of a British firm, oriental life assurance
company in 1818 followed by Bombay life assurance company in 1823,
the madras equitable life insurance society in 1829 and oriental life
assurance company in 1874.prior to 1871, Indian lives were treated as
sub standard and charged an extra premium of 15% to 20%. Bombay
mutual life assurance society, an Indian insurer that came in to
existence in 1871, was the first to cover Indian lives at normal rates.
The Indian insurance company Act 1923 was enacted inter alia, to
enable the government to collect statistical information about life and
nonlife insurance business transacted in India by Indian and foreign
insurer, including the provident insurance societies. The first half of
the 20th century marked by two world war, the adverse affects of the
World War I and World War II on the economy of India, and in
between them the period of world wide economic crises triggered by
the Great depression. The first half of the 20th century was also
marked by struggles for India’s independence. The aggregate effect of
these events led to a high rate of bankruptcies and liquidation of life
insurance companies in India. This had adversely affected the faith of
the general public in the utility of obtaining life cover In this
background, the Parliament of India passed the Life Insurance of India
Act on 19th June 1956, and the Life Insurance Corporation of India
was created on 1st September, 1956, by consolidating the life
insurance business of 245 private life insurers and other entities
offering life insurance services.
Since 1972, the insurance sector has been totally under the control of
government of India through LIC and GIC and its subsidiaries. As a
result, revenue of both of them increased in the last years .the amount
of savings pooled by LIC increased from Rs.2704 crores in 1974 to Rs .
57670 in 1994 with an annual growth rate of 16.53% .similarly
premium underwritten by GIC rose from 280 crores in 193 to 7647
crores in 1998 showing an annual growth rate of 25.18%. Despite
increase in premium collected by both LIC and GIC their were
inefficiency and red tapeisum creeped in to the insurance sector. Apart
from that a major policy shift by the Narasimha Rau government
during 1990’s.the Indian economy opened for foreign competition .In
this background The government of India in 1993 had set-up a high
powered committee by R.N Malhothra ,former governor reserve bank
of India, to examine the structure of Indian insurance sector and
recommended changes to make it more efficient and competitive
keeping in view structural changes in other part of the financial system
of the country. Insurance sector has been opened up for competition
from Indian private insurance companies with the enactment of
Insurance Regulatory and Development Authority Act, 1999 (IRDA
Act). As per the provisions of IRDA Act, 1999, Insurance Regulatory
and Development Authority (IRDA) was established on 19th April 2000
to protect the interests of holder of insurance policy and to regulate,
promote and ensure orderly growth of the insurance industry. IRDA
Act 1999 paved the way for the entry of private players into the
insurance market, which was hitherto the exclusive privilege of public
sector insurance companies/ corporations.

With a view to serve the society, the insurance organizations have
been developed in different forms with innovation of insurance practice
for social welfare and development; some of these forms are outlined

a) Self-insurance
The arrangement in which an individual or concern sets up a private
fund to meet the future risk. If some losses happened in the future the
firm meets the loss out of the fund. While it may be called ‘self
insurance’ it is not a single matter of fact, insurance at all because
there is no hedge, no shifting, or distributing the burden of risk among
larger Persons. It is merely a provision to meeting the unforeseen
event. Here the insured become the insurer for the particular risk. But
it can be effectively worked only when there is wide distribution of
risks subjected the same hazard.

b) Partnership
A partnership firm may also carry on the insurance business for the
sake of profit. Since it is not an entity distinct from the persons
comprising it, the personal liability of partners in respect to the
partnership debts is unlimited. In case of huge loss the partners may
have to pay from their own personal funds and it will not be profitable
to them to starts insurance business .in the early period before the
advent of joint stock companies many insurance undertakings were
partnership firms or unincorporated companies

c) Joint stock companies
The joint stock companies are those, which are organized by the
shareholders who subscribe the necessary capital to start the business.
These are formed for earning profits for the stockholders who are the
real owners of the companies. The management of a company is
entrusted to a board of directors who is elected by the shareholders
from amongst themselves. The company can operate insurance
business and policyholders have nothing to do with the management
of the concern. But in life insurance it is the practice to share certain
portion of profit among the certain policyholders.
d) Mutual fund companies The mutual fund companies are co-
operative association formed for the purpose of effecting insurance on
the property of its members. The policyholders are themselves the
shareholders of the companies each member is insured as well as
insured. They have power to participate in management and in the
profit sharing to the full extent. Whenever the income is more than the
expenses and claims, it is accumulated I the form of saving and is
entitled in reducing the rate of premium. Since the insured are
insurers also, they always try to reduce the management expenses
and to keep the business at sound level.

e) Co-operative insurance organizations Cooperative insurance
organizations are those concerns, which are incorporated and
registered under Indian cooperative societies Act. The concerns are
also called ‘co operative insurance societies’ these societies like mutual
fund companies are non profit organization .the aim is to provide
insurance protection to its members at the lowest reasonable net
cost .the Indian insurance Act. 1938, has provided special provisions
for the co-operative insurance societies, but after nationalization the
societies have ceased to exist.

f) Lloyd’s Association

Lloyd’s association is one of the greatest insurance institutions in the
world. Taking its name from the coffee house Lloyd where
underwriters assembled to transact business and pick-up news. The
organization traces its origins to the latter part of the seventeenth
century .so it is the oldest insurance organization in existing form in
the world. In 1871,Lloyds Act was passed incorporating the members
of the association into a single corporate body with perpetual
succession and a corporate seal .the powers of Lloyds corporation were
extended from the business of marine insurance to the other insurance
and guarantee business. The Lloyds Association also publishes, Lloyds
list and register of shipping for the information of insuring public and
the insurers
g) State Insurance

The government of a nation, some times, owns the insurance and runs
the business for the benefit of the public. The sate insurance is defined
as that insurance which is under public sector. In Brazil, Japan and
Mexico, the insurance are largely nationalized. Previously, the state
undertook only those insurances, which were regarded as vital for the
national interest.


Having looked at the insurance sector, the efforts made by the
government to make the industry more dynamic and customer
friendly. To begin with, the Malhotra committee was set up with the
objective of suggesting changes that would achieve the much required
dynamism. The Malhotra Committee Report In 1993, Malhotra
Committee, headed by former Finance Secretary and RBI Governor R.
N. Malhotra, was formed to evaluate the Indian insurance industry and
recommend its future direction. In 1994, the committee submitted the
report and gave the following recommendations: Structure
Government stake in the insurance Companies to be brought down to
50% Government should take over the holdings of GIC and its
subsidiaries so that these subsidiaries can act as independent
corporations All the insurance companies should be given greater
freedom to operate

Competition Private Companies with a minimum paid up capital of
Rs.1bn should be allowed to enter the industry No Company should
deal in both Life and General Insurance through a single entity Foreign
companies may be allowed to enter the industry in collaboration with
the domestic companies. Postal Life Insurance should be allowed to
operate in the rural market. Only one State Level Life Insurance
Company should be allowed to operate in each stat Regulatory Body
The Insurance Act should be changed. An Insurance Regulatory body
should be set up. Controller of Insurance (Currently a part from the
Finance Ministry) Investments Mandatory Investments of LIC Life Fund
in government securities to be reduced from 75% to 50%. GIC and its
subsidiaries are not to hold more than 5% in any company (There
current holdings to be brought down to this level over a period of
time). Customer Service LIC should pay interest on delays in
payments beyond 30 days. Insurance companies must be encouraged
to set up unit linked pension plans. Computerization of operations and
updating of technology to be carried out in the insurance industry.
Overall, the committee strongly felt that in order to improve the
customer services and increase the coverage of the insurance industry
should be opened up to competition. But at the same time, the
committee felt the need to exercise caution as any failure on the part
of new players could ruin the public confidence in the industry.
Function of an insurance broker

An insurance broker is basically a "middle man" (or woman!) who will
find insurance for you. The thing to keep in mind with any broker is
that he or she will only be working with certain insurance companies --
usually those who will give them the best commission. Therefore, they
don't work with all the available insurance companies, but only a select
few. So, if you want the best deal, you may have to work with more
than one broker, or even do some legwork yourself.

The web makes that easy; you can get quotes online directly.

As far as insurance goes, it is "risk management" for you. You are
paying for a service that both you and the insurer are hoping you'll
never need!

In some cases, you are required to have insurance by law. Your car
insurance is an example of this. In other cases, you are required to
have insurance as a condition of a loan, like your mortgage.

In all cases where you have insurance, you are protecting an asset,
although in some cases that is more obvious than others. With life
insurance, you are protecting your family or inheritors from the loss of
you and your income. With health insurance, you are protecting your
income from the cost of healthcare. With disability insurance, you are
protecting your ability to generate income.

This is even true with health, life and disability insurance. With life
insurance, you are protecting your income and your family or
Market analysis

A detailed study was preformed on the market composition of Religare
Insurance Broking Ltd.

The following findings were obtained.

 A large chunk of the premium comes from GMC which makes up
a chunk of 66% of the total premium
 With quite a few companies we have brokered a variety of
insurance product genres but none of them have that high a
premium rate
 Other genres like Fire and motor are large in the number of
policies sold, but do not have that high a rate of premium.
 There are many genres we have not tapped into.. For e.g.
3. Marine policies
4. B&P
Even though we have provided these genres..
Their percentage intake is only 6%.. Which is very little.
These genres can be approached to increase business intake.
P re m iu m A m t


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About Religare Insurance Broking Ltd

Parent Company Religare
Name - Religare is a Latin word that translates as 'to bind together'.
This name has been chosen to reflect the integrated nature of the
financial services the company offers.

Symbol - The Religare name is paired with the symbol of a four-leaf
clover. Traditionally, it is considered good fortune to find a four-leaf
clover as there is only one four-leaf clover for every 10,000 three-leaf
clovers found.

For us, each leaf of the clover has a special meaning. It is a symbol of
Hope. Trust. Care. Good Fortune.

Vision - To build Religare as a globally trusted brand in the financial
services domain and present it as the ‘Investment Gateway of India'.

Mission - Providing complete financial care driven by the core values
of diligence and transparency.

Brand Essence - Core brand essence is Diligence and Religare is
driven by ethical and dynamic processes for wealth creation.
Religare Insurance Broking Limited.

Religare Insurance Broking Limited (RIBL), a 100% subsidiary of
Religare Enterprises Limited is one of India’s leading insurance broking
firms, with a strong retail network in the country. The company holds
a composite broker’s license operating in the Life, General and
Reinsurance domains

An insurance portfolio is designed from a choice of more than 3000 life
and general insurance products & plans from more than 30 companies.
This is one easy window for any brand of insurance, any kind of cover,
offers tailor made insurance solutions with not just the right kind of
cover but also the right mix of cover.

RIBL not only provides customized solutions to individual clients, but
also to some of the leading corporate houses and institutions across
the country. Our team across the country is driven by the core
philosophy of creating and delivering value to its customers. Our
strengths are a team of passionate professionals, a robust IT
infrastructure and strong risk analysis teams adept at identifying &
analyzing your risks and providing you with tailor made solutions.

Vision and Mission

"To be India's most trusted insurance partner"
"To create and institutionalize an ethical, process driven, advisory led
approach, backed by the right expertise & sharp insights,
benchmarked against global best practices"
Religare as an Insurance Broker

Religare Insurance Broking Limited, a wholly owned subsidiary of
Religare Enterprises Limited is one of India's leading insurance broking
firms, with a strong retail network in the country. The company holds
a composite broker's license for operating in the Life, General and
Reinsurance domains.
As an Insurance Broker, Religare offers you a single window for
everything you need to insure. Our domain knowledge, backed by our
expertise and multi-brand multi-product business model, ensures you
get tailor-made insurance solutions. We design your insurance
portfolio from diversified life and general insurance products and plans
from over 30 companies. So you get both the right kind and the right
mix of cover. All under one roof
• Freedom of choice to the customer
• Represents clients to insurance companies
• Gets the best deals to the clients - Cost, Coverage & Service
• Technical and functional expertise
• Proactive assistance and claims management
• Professional and unbiased approach
• Services the client at zero cost
Our Client Interface

Corporate Spectrum
Developing customized insurance solutions for local &
multinational corporate clients.
• Risk Management
• onsite/offsite Assessments
• Claims Management
• Centralized servicing
• Underwriter Due Diligence
• Industry specific experts
• Specialty Risk Coverage
• Reinsurance
• National and International

Retail Network
Offering complete range of personal insurance products
through the Nationwide Network
• Life Insurance
• Pure Insurance Solutions
• Investment Linked Plans
• Guaranteed Saving Plans
• General Insurance
• Motor Insurance
• Health Insurance Program
• Travel Protection Schemes
• Package Policies for SMEs
• Financial Wellness
• Child Plans
• Protection Plans
• Retirement Plans
Risk Placement Process
Our Value Proposition

Strong Domain Expertise
Rich domain knowledge and Industry experts
Comprehensive Risk Portfolio Management
Expertise to meet all your Insurance needs
Market understanding, proactive and customer centric
Human, technical, physical presence, CRM
Best business practices and highest quality service
Strategic Partnerships
Alliance with global and national players to get you the best deals
Why Religare

Composite Insurance Broker
IRDA approved licensor working since November 2006. Dealing in
General & Life Insurance for both commercial and retail sectors.

Dedicated Insurance helpdesks to cater client related problems both
before and after sales.

Corporate Insurance Services
Technical and functional expertise to manage corporate business in all
major locations. Mandated broker for a number of large corporate

RIBL represents a diversed bouquet of services spread across
corporate, retail and institutional spectrum.

Comprehensive risk management portfolio
We have expertise to meet all your insurance needs and handle your
insurance portfolio effeciently.

Strategic Partnership
We have alliances with global and national players to get you the best
deals at any given point of time.

Customer - centric company
Our focus is to provide the best in the market services which does not
build a hole in your pocket.
Corporate Clients

Life Insurance

ICICI Prudential Life Insurance Co. Ltd.
Birla Sun Life Insurance Co. Ltd.
Kotak Mahindra Old Mutual Life Insurance Ltd.
Bajaj Allianz Life Insurance Co. Ltd.
Life Insurance Corporation of India
Aviva Life Insurance Co. India Pvt. Ltd.
Met Life India Insurance Co. Pvt. Ltd.
HDFC Standard Life Insurance Co. Ltd.
SBI Life Insurance Co. Ltd.
ING Vysya Life Insurance Co. Ltd.
Tata AIG Life Insurance Co. Ltd.
Reliance Life Insurance Co. Ltd.

General Insurance

ICICI Lombard General Insurance Co. Ltd.
Royal Sundaram Alliance Insurance Co. Ltd.
Cholamandalam MS General Insurance Co. Ltd.
Bajaj Allianz General Insurance Co. Ltd.
Tata AIG General Insurance Co. Ltd.
IFFCO Tokio General Insurance Co. Ltd.
Star Health & Allied Insurance Co. Ltd.
HDFC General Insurance Co. Ltd.
Reliance General Insurance Co. Ltd.
National Insurance Co. Ltd.
New India Assurance Co. Ltd.
United India Insurance Co. Ltd.
Oriental Insurance Co. Ltd.

Throughout the span of creating this report, I have taken the help of
various sources. Some of these sources were used for literary ways,
others simply for support and knowledge enrichment. Either ways, I am
sincerely grateful.

1. Www. Wikipedia .com
2. Www.
3. Www. NHPC. Com
4. Www.
5. Www. Insurancefordummies .com
6. Www.
7. Www.
Thank you…