Professional Documents
Culture Documents
Final Presentation of Kotak
Final Presentation of Kotak
REPORT
On
By
Chirag Patel
(5NB 3430)
1
CERTIFICATE
2
DECLARAION
Chirag Patel
(5NB3430)
3
TABLE OF CONTENTS
Contents Page No.
Acknowledgements 5
List of Tables 6
List of Illustrations/Diagrams 7
Executive Summary 9
Chapter 1: introduction 10
Objective 15
Limitation 17
Research Mythology 19
Data Collection 22
Chapter 2: Life Insurance Industry 23
Industry profile 24
important milestones in the life insurance business 29
Insurance sector reforms 31
IRDA 32
Chapter 3: Contribution of Life Insurance Industry 36
Contribution of Life Insurance in the Economy 36
Flow of Insurance Industry in India 37
Structure of life Insurance Industry 40
Life Insurance industry 41
Aggregation of Long Term Savings 42
Spread of financial services in rural Areas 43
Long term funds for infrastructure Development of Capital 44
Markets/Economic Growth
Employment generation 45
Special Features 46
Growth Potential 47
Phase of transition 47
Chapter 4:Company Profile 49
Management 51
Area of Business 56
KMOM progress till date 65
KMOM-the partnership and Lineage 66
Products 69
Hierarchy of KMOM of Surat branch 71
Chapter 5: Survey 72
Data interpretation , editing and coding 73
Graph analysis 73
Chapter 6: Finding and Suggestion 83
Chapter 7: Conclusion 84
Chapter 8: References 85
Chapter 9: Annexure 86
4
Acknowledgement
Chirag Patel
5
List of Tables
7
Chapter 1:
Introduction
8
Executive Summary
9
insurance is largely a development of the recent past, particularly
after the industrial era past few centuries yet its beginnings date
back almost 6000 years.
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 these companies were not insuring
Indian natives. 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. Starting as Indian enterprise
with highly patriotic motives, insurance companies came into
existence to carry the message of insurance and social security
through insurance to various sectors of society. Bharat Insurance
Company (1896) was also one of such companies inspired by
nationalism. The Swadeshi movement of 1905-1907 gave rise to
more insurance companies. The United India in Madras, National
Indian and National Insurance in Calcutta and the Co-operative
10
Assurance at Lahore were established in 1906. In 1907, Hindustan
Co-operative Insurance Company took its birth in one of the rooms
of the Jorasanko, house of the great poet Rabindranath Tagore, in
Calcutta. The Indian Mercantile, General Assurance and Swadeshi
Life (later Bombay Life) were some of the companies established
during the same period. Prior to 1912 India had no legislation to
regulate insurance business. In the year 1912, the Life Insurance
Companies Act, and the Provident Fund Act were passed. The Life
Insurance Companies Act 1912 made it necessary that the premium
rate tables and periodical valuations of companies should be
certified by an actuary. But the Act discriminated between foreign
and Indian companies on many accounts, putting the Indian
companies at a disadvantage.
11
Channel partners are those who are going to be into direct selling
of companys products i.e. the insurance policies. They are the link
between the customers and the management or company. These
channel partners are people with different profiles. They are
selected on some grounds like their network of people, their
problem handling ability, convincing power and lot many things.
12
approaches and better use of distribution channels and technology,
they are eating in to the shares of established public sector
companies in Indian Insurance Market. Since the deregulation has
been put in to place, the market share of LIC has come down to
71.4% in life insurance market while the private players have
captured around 17% market in the general insurance segment.
This report includes the key private players in the insurance market
such as ICICI Prudential, Kotak Life Insurance Bajaj Allianz, Birla
Sun life, and TATA AIG. It also includes the leading competitors in
the life insurance and general insurance segments along with their
market shares.
13
Chapter 2
Objective
Limitation
Methodology
Data collection
14
1. Objective:
The main of the present study of is accomplish the following
objective.
Proper understanding and analysis of life insurance
industry.
To know about brand awareness of Kotak Life
Insurance and customers preference about Kotak Life
Insurance.
Conduct market survey on a sample selected from the
entire population and derived opinion on that research.
According the market survey come know about how
much potential of insurance market in our city.
And base on analysis of the result thus obtained make a
report on that research.
Training aims at recruiting maximum number of Life
Advisors and to Sell the maximum policies for the
company and bring the business for the company which
ever is going at the particular point of time.
15
As the Kotak Life Insurance well reputed company in
India its great chance for me to observed different
products launch by other competitor companies like
ICICI prudential, Bajaj alliance ,LIC, Max New York
life etc. In all, it is to understand the overall working of
the Life insurance sector.
16
5: Limitation:
17
returns which is not true nowadays. Nowadays most of the
modern Unit Linked Insurance Plans gives returns which are
many times more than that of bank Fixed deposits, National
saving certificate, Post office deposits and Public provident fund.
18
RESEARCH METODOLOGY
19
potentiality of life insurance in Surat: How much potential is there
in Surat?
20
in my project and also make questionnaire for creating database of
business class people is Surat city for company.
21
DATA COLLECTION
After the research methodology, research problem in
marketing has been identified and selected; the next step is
together the requisite data. There are two types of data collection
method primary data and secondary data.
Chapter: 3
22
Industry profile:
23
Brief History of the Insurance Sector in
India
24
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. Starting as Indian enterprise
with highly patriotic motives, insurance companies came into
existence to carry the message of insurance and social security
through insurance to various sectors of society. Bharat Insurance
Company (1896) was also one of such companies inspired by
nationalism. The Swadeshi movement of 1905-1907 gave rise to
more insurance companies. The United India in Madras, National
Indian and National Insurance in Calcutta and the Co-operative
Assurance at Lahore were established in 1906. In 1907, Hindustan
Co-operative Insurance Company took its birth in one of the rooms
of the Jorasanko, house of the great poet Rabindranath Tagore, in
Calcutta. The Indian Mercantile, General Assurance and Swadeshi
Life (later Bombay Life) were some of the companies established
during the same period. Prior to 1912 India had no legislation to
regulate insurance business. In the year 1912, the Life Insurance
Companies Act, and the Provident Fund Act were passed. The Life
Insurance Companies Act 1912 made it necessary that the premium
rate tables and periodical valuations of companies should be
25
certified by an actuary. But the Act discriminated between foreign
and Indian companies on many accounts, putting the Indian
companies at a disadvantage.
The first two decades of the twentieth century saw lot of growth in
insurance business. From 44 companies with total business-in-
force as Rs.22.44 crore, it rose to 176 companies with total
business-in-force as Rs.298 crore in 1938. During the
mushrooming of insurance companies many financially unsound
concerns were also floated which failed miserably. The Insurance
Act 1938 was the first legislation governing not only life insurance
but also non-life insurance to provide strict state control over
insurance business. The demand for nationalization of life
insurance industry was made repeatedly in the past but it gathered
momentum in 1944 when a bill to amend the Life Insurance Act
1938 was introduced in the Legislative Assembly. However, it was
much later on the 19th of January 1956 that life insurance in India
was nationalized. About 154 Indian insurance companies, 16 non-
Indian companies and 75 provident were operating in India at the
time of nationalization. Nationalization was accomplished in two
stages; initially the management of the companies was taken over
by means of an Ordinance, and later, the ownership too by means
of a comprehensive bill. The Parliament of India passed the Life
26
Insurance Corporation Act on the 19th of June 1956, and the Life
Insurance Corporation of India was created on 1st September,
1956, with the objective of spreading life insurance much more
widely and in particular to the rural areas with a view to reach all
insurable persons in the country, providing them adequate financial
cover at a reasonable cost.
LIC had 5 zonal offices, 33 divisional offices and 212 branch
offices, apart from its corporate office in the year 1956. Since life
insurance contracts are long-term contracts and during the currency
of the policy it requires a variety of services need was felt in the
later years to expand the operations and place a branch office at
each district headquarter. Re-organization of LIC took place and
large numbers of new branch offices were opened. As a result of
re-organization servicing functions were transferred to the
branches, and branches were made accounting units. It worked
wonders with the performance of the corporation. It may be seen
that from about 200.00 Crores of New Business in 1957 the
corporation crossed 1000.00 Crores only in the year 1969-70, and
it took another 10 years for LIC to cross 2000.00 crore mark of
new business. But with re-organization happening in the early
eighties, by 1985-86 LIC had already crossed 7000.00 crore Sum
Assured on new policies.
27
Today LIC functions with 2048 fully computerized branch offices,
100 divisional offices, 7 zonal offices and the corporate office.
LICs Wide Area Network covers 100 divisional offices and
connects all the branches through a Metro Area Network. LIC has
tied up with some Banks and Service providers to offer on-line
premium collection facility in selected cities. LICs ECS and ATM
premium payment facility is an addition to customer convenience.
Apart from on-line Kiosks and IVRS, Info Centers have been
commissioned at Mumbai, Ahmedabad, Bangalore, Chennai,
Hyderabad, Kolkata, New Delhi, Pune and many other cities. With
a vision of providing easy access to its policyholders, LIC has
launched its SATELLITE SAMPARK offices. The satellite offices
are smaller, leaner and closer to the customer. The digitalized
records of the satellite offices will facilitate anywhere servicing
and many other conveniences in the future.
From then to now, LIC has crossed many milestones and has set
unprecedented performance records in various aspects of life
insurance business. The same motives which inspired our
forefathers to bring insurance into existence in this country inspire
us at LIC to take this message of protection to light the lamps of
security in as many homes as possible and to help the people in
providing security to their families.
28
Some of the important milestones in the life
insurance business in India are:
1956 245 Indian and foreign insurers and provident societies 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 Crore from the Government of India.
29
The General insurance business in India, on the other hand, can
trace its roots to the Triton Insurance Company Ltd., the first
general insurance company established in the year 1850 in Calcutta
by the British. Some of the important milestones in the general
insurance business in India are:
1907 The Indian Mercantile Insurance Ltd. set up, the first
company to transact all classes of general insurance business.
1957 General Insurance Council, a wing of the Insurance
Association of India, frames a code of conduct for ensuring fair
conduct and sound business practices.
1968 The Insurance Act amended to regulate investments and set
minimum solvency margins and the Tariff Advisory Committee set
up.
1972 The General Insurance Business (Nationalization) Act,
1972 nationalized the general insurance business in India with
effect from 1st January 1973. 107 insurers 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. GIC incorporated as a company.
30
Insurance sector reforms
31
The Insurance Regulatory and Development
Authority (IRDA)
But the scenario changed with the private and foreign companies
foraying in to the insurance sector. This necessitated the need for a
strong, independent and autonomous Insurance Regulatory
Authority was felt. As the enacting of legislation would have taken
time, the then Government constituted through a Government
resolution an Interim Insurance Regulatory Authority pending the
enactment of a comprehensive legislation.
32
Insurance Act, 1938, the Life Insurance Corporation Act, 1956 and
the General insurance Business (Nationalization) Act, 1972 to end
the monopoly of the Life Insurance Corporation of India (for life
insurance business) and General Insurance Corporation and its
subsidiaries (for general insurance business).
The act extends to the whole of India and will come into force on
such date as the Central Government may, by notification in the
Official Gazette specify. Different dates may be appointed for
different provisions of this Act.
The Act has defined certain terms; some of the most important
ones are as follows
Words and expressions used and not defined in this Act but defined
in the Insurance Act, 1938 or the Life Insurance Corporation Act,
1956 or the General Insurance Business (Nationalization) Act,
33
1972 shall have the meanings respectively assigned to them in
those Acts
34
Chapter: 4
35
FLOW OF Insurance Industry in
India
Special Features
STRUCTURE OF INSURANCE
INDUSTRY: Snap Shot
Historical Perspective
(i) Prior to 1956 242 companies operating
(ii) 1956 - 2001 Nationalization LIC monopoly
player Government control
(iii) 2001 -- Opened up sector
36
Industry
Snap Shot - Contd.
(a) LIC Fully owned by Government
(b) Postal Life Insurance
(ii) Private players -
1. Bajaj Allianz Life Insurance Co. Ltd.
2. Birla Sun Life Insurance Co. Ltd. (BSLI)
3. HDFC Standard Life Insurance Co. Ltd. (HDFC STD
LIFE)
4. ICICI Prudential Life Insurance Co. Ltd. (ICICI
PRU)
5. ING Vysya Life Insurance Co. Ltd. (ING VYSYA)
6. Max New York Life Insurance Co. Ltd. (MNYL)
7. MetLife India Insurance Co. Pvt. Ltd. (METLIFE)
8. Kotak Mahindra Old Mutual Life Insurance Co. Ltd.
9. SBI Life Insurance Co. Ltd. (SBI LIFE)
10. TATA AIG Life Insurance Co. Ltd. (TATA AIG)
11. Reliance Life Insurance
12. Aviva Life Insurance Co. Pvt. Ltd. (AVIVA)
13. Sahara India Life Insurance Co. Ltd. (SAHARA
LIFE)
14. Shriram Sunlam
(iii) Other likely players PNB Life Insurance,
Axa Bharti Enterprises
37
Potential of the Insurance sector:
Market share:
Market Share
38
Company Indian Foreign Market
Promoter/ Insurance share
Partner based on
premium
Aviva life Dabur Aviva, UK 1.12
Bajaj Bajaj Auto Allianz, 6.12
Allianz Germany
Birla sun Aditya Sun Life, 1.84
life Birla Canada
group
HDFC HDFC Standard 2.96
Standard Life, UK
ICICI ICICI Prudential, 7.11
Prudential Bank UK
ING Vysya ING 0.63
Vysya Bank Insurance,
Netherlands
Kotak Kotak Old Mutual 0.71
Mahindra, Mahindra South
Old Bank Africa
Mutual
Max New Max India New York 1.32
York Life, US
MetLife Jammu & MetLife, 0.40
Kashmir US
Bank
Sahara Sahara None 0.80
Life India
Insurance
SBI Life SBI Cardiff, 1.52
France
Tata AIG Tata AIG, US 1.78
Group
39
CONTRIBUTION TO INDIAN
ECONOMY
(i) Life Insurance is the only sector which garners
pension sector
40
Aggregation of Long Term
Savings
(i) Total Assets of Life Insurance
Companies
41
Spread of financial services in
rural areas and amongst socially
underprivileged
IRDA Regulations provide certain minimum business to be done
1400 centers.
in rural areas.
42
Long term funds for
infrastructure
43
Development of Capital Markets/
Economic Growth
44
EMPLOYMENT GENERATION
employment opportunities.
15.59 lakhs
45
SPECIAL FEATURES
Tax clubbing of various savings short term and long term into
same bracket have a bias towards short term savings.
Distinction between the short term savings and long term savings
is critical from investors point of view. More prone to inflationary
pressures
46
GROWTH POTENTIAL
PHASE OF TRANSITION
Life Insurance industry is under the phase of infancy after 50
years of monopoly
47
Chapter: 5
Company profile
Management
Areas of Business
48
COMPANY PROFILE
In the USA, OLD MUTUAL is one of the top ten fixed annuity
businesses offering an array of specialist asset management skills
through its 23 asset management businesses. The companys US
Life business recorded sales of $4 billion at the end of 2002.
49
Operations in the United Kingdom are focused on wealth
management, through Gerrard as one of the leading private client
The OLD MUTUAL Group has the ability to cater for a variety of
consumer segments and offers a comprehensive and innovative
range of products for all income groups.
50
Mission:
MANAGEMENT
51
ship from the Institute of Company Secretaries of India. Mr.
Gaurang Shah has been with the Kotak Group for the past eight
years where he has held different positions of great
responsibility and juggled multiple tasks effectively. His
cumulative experience, primarily in financial services, stands at
over 21 years, several of those in building the retail finance
business. At Kotak Life Insurance, Mr. Shah will focus on
developing new lines of businesses and leveraging the
company's existing competencies and network to steer Kotak
Life Insurance on its ongoing growth path with even greater
thrust. Mr. Shah has a commendable expertise in managing a
large number of employees.
52
Mr. G Murlidhar (Chief Financial Officer)
53
Mr. Nandip Vaidya (Vice President - Sales)
54
Mr. Arun Patil (Vice President - Sales & Management
Development)
55
time Eksteen pioneered the introduction of the CFP qualification
into South Africa. He has traveled widely during his career,
working in the USA and England and also implemented Training
Programme in Namibia, Zimbabwe, Malawi and Kenai. His
current role is to substantially upgrade the level of Training and
assist in the implementation of Performance Management Systems
in Kotak Life Insurance.
AREAS OF BUSINESS
56
In October 2005, Kotak Group acquired the 40% stake in Kotak
Mahindra Prime held by Ford Credit International (FCI) and
FCI acquired the stake in Ford Credit Kotak Mahindra (FCKM)
held by Kotak Group.
In March 2006, Kotak Group has agreed to buy 25% stake held
by Goldman Sachs in KMCC and KS subject to regulatory
approvals.
57
The group has a net worth of around Rs.2,000 crore and employs
around 6,000 employees across its various businesses servicing around
one million four hundred thousand customer accounts through a
distribution network of branches, franchisees, representative offices
and satellite offices across 216 cities and towns in India and offices in
New York, London, Dubai and Mauritius.
58
KOTAK GROUP IS INVOLVED IN THE FOLLOWING
AREAS OF BUSINESS:-
59
Kotak Mahindra Capital Company Ltd.
60
Its the first Indian Investment Bank to be appointed by the
Government of India as a Co-lead Manager in their international
divestment of Gas Authority of India Ltd through a GDR offering.
61
Kotak Mahindra Asset Management Company
International Subsidiaries
62
providing service to both Institutional investors and High Net
worth Clients in the US for their investments into Indian markets.
Kotak Securities
63
investors can use the brokerage services of the Company for
executing the transactions and the depository services for settling
them.
64
KMOM PROGRESS TILL DATE
44 branches in 31 cities.
7500 life advisors.
1000employees of very good quality.
Ranks 2nd in terms of average premium per policy.
Ranks 4th in total advertising awareness.
First year premium income:
2001-02: 7 Crores
2002-03: 35 Crores
2003-04: 124 Crores
2004-05: 375 Crores
65
KMOM THE PARTNERSHIP AND
LINEAGE
A 26%-74% JOINT VENTURE BETWEEN
66
Multi channel management
Old Mutual was established more than 150 years ago. Old
mutual plc. is a world-class international financial service
company. It owns the largest companies in the following areas in
South Africa. They are:
1. Life Insurance Company
2. Asset Management Company
3. Bank
4. Non-life insurance company
It has been developed into an International financial services group
whose activities are focused on asset gathering and asset
management. The Old Mutual Group offers a diverse range of
financial services in three principal geographies: South Africa, the
United States and the United Kingdom. The company is listed on
the London Stock Exchange with a market capitalization of
approximately $6 billion and is a member of the elite FTSE 100
index. In the 2003 rankings of the World's 500 largest corporations
by Fortune magazine, Old Mutual climbed 87 places to position
number 366 and was also listed as the 14th largest insurance
company in the world.
67
Old Mutual is the largest financial services business in South
Africa, through its life insurance, asset management, banking and
general insurance operations. The company serves 4 million life
insurance policyholders and employs over 13 000 South Africans
in its local operations.
In the USA, Old Mutual is one of the top ten fixed annuity
businesses offering an array of specialist asset management skills
through its 23 asset management businesses. The companys US
Life business recorded sales of $4 billion at the end of 2002.
Operations in the United Kingdom are focused on wealth
management, through Gerrard as one of the leading private client
stock broking businesses in the UK.
The Old Mutual Group has the ability to cater for a variety of
consumer segments and offers a comprehensive and innovative
range of products for all income groups.
68
PRODUCTS
Term Plans
Kotak Term Assurance Plan
Kotak Preferred Term Plan
Endowment Plans
Kotak Endowment Plan
Kotak Money Back Plan
Kotak Child Advantage Plan
Kotak Capital Multiplier Plan
Kotak Retirement Income Plan
Kotak Premium Return Plan
Unit Linked Plans
Kotak Retirement Income Plan (Unit-linked)
Kotak Safe Investment Plan II
Kotak Flexi Plan
Kotak Easy Growth Plan
Kotak Privilege Assurance Plan
Group
Employee Benefits
Kotak Term Grouplan
Kotak Credit-Term Grouplan
Kotak Complete Cover Grouplan
69
Kotak Gratuity Grouplan
Kotak Superannuation Group Plan
Rural
Kotak Gramin Bima Yojana
70
HIERARCHY OF KMOM LIFE INSURANCE
LIMITED
(SURAT BRANCH)
Branch manager
Sales Manager
Operation Executive
Assistant SM Operations
Life advisor
71
Chapter: 5
72
Age Wise Clasification
45 44
40
35
30
No. of Customers
25
22 23
20
15
11
10
0
18-25 26-30 31-45 46 & Above
Years
AGE No Of Members
18-25 11
26-30 22
31-45 44
46 to above 23
73
Gender wise clasification
Gender No of Member
70
66
MALE 66
60
FEMALE 34
50
No. of Customers
40
34
30
20
10
0
MALE FEMALE
Years
74
Members
50
48
45
40 40
35
No. of Customers
30
25
20
15
12
10
0
2 to 4 5 to 8 8 to aboce
No of members
75
Income No of Members
40K -70K 17
70K-1 Lake 41
1 Lake to 3 Lakes 28
3 Lacks 14
76
Income Wise Classification
45
40
41
35
30
28
No. of Customers
25
20
17
15 14
10
0
40 k to 70k 70k to 1 Lake 1 Lake to 3 3 Lake to
Lakes Above
Income (P.A)
77
NO OF MEMBER HAVING INSURANCE
NO
58%
YES
42%
78
40 40
35
30 28
No. of Customers
25
21
20 18
15
11
10
0
Self Spouse Children Parents All
79
35
LIC
30
ICICI
25
No. of Customers
Birla
Sunlife
20
SBI
15
HDFC
10
Bajaj
Alliance
5
TATA
AIG
0 Kotak
Term Plan Endowment Whole life Money Back Retirement Child Plan Unit Link
Plan Mahindr
a
Different Plans ING
Vyasya
Max
Newyork
Met Life
80
Under insurable persons Fully insurable persons
82% 18%
Under Insured
82% Fully Insured
18%
81
82
Insurance Plan Market Share
Term Plan 39%
Money back Plan 14%
Endowment Plan 15%
Child Plan 8%
Unit link Plan 24%
Unitlink plan
24% Child Plan
8%
Endownment Plan
15%
Term Plan
39% Moneyback Plan
14%
83
Chapter 6:
Finding
Suggestion
84
Finding and Suggestion
Chapter 7
85
Conclusion
8 References
86
In order to obtain more information regarding the present study
and to substantiate it with theoretical proof, the following
references were made: -
Websites visited:
www.kotaklifeinsurance.com
www.google .com
Chapter 9:
87
Annexure
Questionnaire
1) Name ______________________________
2) Age
4) Occupation:
5) Family member
1) 2 to 4 2) 5 to 8 3) 8 to above
Yes_______ No_______
If yes,
Which is it?
Companys Term Endow Whole Money Retire Child Unit
name plan ment life back ment Plan link
Plan
LIC
88
ICICI
Prudential
Birla
Sunlife
SBI Life
HDFC
Standard
Life
Bajaj
Alliance
TATA AIG
Kotak
Mahindra
ING Vysya
Max
Newyork
Met Life
Reliance
Shri Ram
Sahara
89
90