SUMMER INTERNSHIP PROJECT REPORT

ON

“TO STUDY CUSTOMER PERCEPTION TOWARDS PRODUCTS OF SHRIRAM

LIFE INSURANCE COMPANY IN NOIDA”

Submitted For

THE PARTIAL FULLFILLMENT OF THE AWARD OF DEGREE OF

MASTER OF BUSINESS ADMINISTRATON (MBA)

Session: 2018-20

Submitted To: Submitted By:

MRS SWATI CHAUDHARY Name: SWATI MISHRA

Roll. No.1873370035

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 HIERANK BUSINESS SCHOOL, NOIDA

A-42, Institutional area, Sector-62 Noida

DECLARATION

This is to certify that dissertation entitled Customers Perception towards of Shriram Life

Insurance Company in Noida is submitted to HIERANK BUSINESS SCHOOL &

MANAGEMENT , Noida, in partial fulfillment of the requirements for the award of the

Master of business administration, and is a record work by SWATI MISHRA. The project

has been done under my supervision & guidance and the project has not formed the basis for

the award of any degree or other similar title to any candidate.

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ACKNOWLEDGEMENT

It’s a privilege to be associated with Shriram Life Insurance, one of the most respected and

dominant life insurance sector. This acknowledgement is not only the means of formality, but

to me, it is a way by which I am getting the opportunity to show the deep sense of

appreciation and commitment to every one of the general population who have given me

motivation, direction and help during the planning of the project

At the very outset, I would like to express my gratitude from bottom of my heart to M/s.

Preeti Rana Relationship Manager, Mr. Junaid Warsi Zonal Manager & Personnel for

giving me the opportunity to do my Summer Internship Project in this esteemed organization.

I want to thanks my faculty Mrs Swati Chaudhary for supporting me to complete my

internship project. Their guidance and co-operation helped me to get a better understanding

of the tasks performed at the organization.

SWATI MISHRA

Session: 2018 - 2020

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 PREFACE

Summer Training is business organization in fuse among student a sense of critical analysis

of the real managerial situation to which they are exposed. This gins them an opportunity to

apply their conceptual theoretical & imaginative skills in a real life situations and to

evaluate the results there of.

Practical training through selling policies and interect with the clients which gave me actual

input to fulfill my real aim.

This report is the written account of what I learnt experienced during my training. I wish

those going through it will not only find it real but also get useful information.

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 EXECUTIVE SUMMARY

Human life is a most important asset and life insurance is the most important type of

insurance which provides financial protection to a person and his family at the time of

uncertain risks or damage. Life insurance provides both safety and protection to individuals

and also encourages savings among people. Shriram Life Insurance plays a vital role in the

welfare of human well-being by providing insurance to millions of people against life risks

such as uncertain death or accident. The present exploratory and descriptive based study was

selected with an objective to examines the various factors that affect the consumer perception

towards life insurance policy and also analyze the preferences of customers while life policy

investment decision-making. Various insurance related factors have been discussed in the

paper. The data for the study has been collected from primary sources. The study area is

limited to Noida and sample size is 100 respondents. The statistical technique used for the

analysis is simple percentage analysis. The main finding of the study reflected that there are

four factors i.e. premium, returns, goodwill of the company and duration of the policy that

influence the consumer perception towards life insurance policy. Insurance companies should

spread more awareness about life insurance, reduction in premium amount and giving more

attention on need based innovative products are some of the suggestions provided by the

researcher. The paper concludes with that earlier Insurance was a means for wealth creation

and that too for a longer period as returns were comparatively low but as compared with the

data in the current part it can be said that people are shifting towards Insurance sector not

only for tax saving but for future planning, life covering risk against security, etc.

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 INDEX

S.NO TOPIC PAGE NO

1 Introduction 7 -54

1.1 Introduction to topic

1.2 Introduction to company

2 Literature Review 55-59

3 Objective of the study 60-61

4 Research methodology 62-65

5 Data analysis and Interpretation 66-78

6 Findings 79-80

7 Conclusion 81-84

8 Limitation 85-86

9 Recommendation 87-88

10 Bibliography 89-91

11 Annexure 92-97

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CHAPTER-1

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1.1 - INTRODUCTION TO TOPIC

Customer perception plays a vital role in a company’s ability to attract new customers and to

retain existing customers. The good news is that companies have the ability to control many

of the factors that build an individual’s perception of the company/brand.

Customer perception definition

The formal definition of customer perception is, “A marketing concept that encompasses a

customer’s impression, awareness and/or consciousness about a company or its offerings.”

To put it simply, customer perception is what your customers and potential customers think

of your organization. This perception directly impacts the attraction of new customers and the

capacity to maintain good relationships with current customers.

study of consumer behaviour provides marketers to understand and predict the

future market behaviour. In this paper, role of IRDA, role of Indian banks, role of private

insurance Consumer behaviour studies the behaviour of individual or a group of people. The

companies, function of insurance company, various factors influencing consumer behaviour,

factors influencing buying decision and model of consumer decisions making process have

been considered. Also, the types of insurance policy taken by consumer, the total sum assured

of life insurance, the total sum assured of life insurance for the spouse, the share of public

insurance in insurance sector, share of LIC in life insurance in insurance sector and the

reasons for invested in life insurance have been studied. The survey was conducted across

334 cities/towns in all the states and union territories. A sample of 1947 individuals has been

selected by setting questionnaire. The online response system has selfchecking and its

validation system vetted the quality and veracity of the responses. Indicus Analytics then

cross-checked and inputs with its databases on investors and their habits. The majorities of

the respondents were from the top five metros and 10 major cities and had at least 30

participants. The profile of the target respondents is typically matched. The target

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respondents are well educated, familiar with English, spread over major urban centers having

a higher socioeconomic and income profile and spread across a range of occupations,

professions and different age groups.

Investor’s perception;

An investor perception is a leading provider of authoritative and considered investor

feedback. IP delivers an independent perspective into how shareholders and the key

underweight institution view a company, its management and its prospects. We analyze in

depth the key factors that collectively define a company’s investment proposition and

ultimately determine the valuation the market places on the shares. An insightful perception

study is an important and powerful management tool, both from a strategic planning and a

corporate governance perspective. Being aware of the opinions and views of investors assists

companies to improve their communication with the market and to ensure the investment

proposition is properly understood and is reflected in the valuation of the shares, which in

turn will influence its cost of capital.

Consumer behaviour;

Consumer behavior is the study of how individual customers, groups or organizations select,

buy, use, and dispose ideas, goods, and services to satisfy their needs and wants. It refers to

the actions of the consumers in the marketplace and the underlying motives for those actions.

Consumer behavior is very important to understand what influences the buying decisions of

the consumers and why does it so.

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By understanding how consumers decide on a product it is possible for marketers to fill in the

gap and identify which product is needed and which products are obsolete in the market. It

also helps marketers decide how to present their products such that they have maximum

impact on consumers.

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 1.2 - INTRODUCTION TO COMPANY

Insurance Industry;

Insurance in India was started in the year of 1956, when Life Insurance Corporation came

into place. Post liberalization, the insurance industry in India has recorded significant growth.

The Indian insurance industry is expected to grow to US$280 billion by FY2020, owing to

the solid economic growth and higher personal disposable incomes in the country. Premium

income of the life insurance segment had increased 14.04% in FY17 to RS4.18 trillion (US$

64.92 billion). The total insurance market expanded from US$ 23 billion in FY05 to US$

84.72 billion in FY17. There are 24 life insurance and 33 non-life insurance companies in the

Indian market who compete on price and services to attract customers. There are more than

six reinsurance companies. The industry has been spurred by product innovation, vipant

distribution channels, coupled with targeted publicity and promotional campaigns by the

insurers. Private sector companies hold 48.01% market share in the general insurance

segment and 28.93% market share in the life insurance segment.

Highlights of Shriram Life Insurance

 Shriram Life has more than 528 branches with over and above 1.45 crore customers.

 Shriram Life clocked Rs.1020 crore gross premium in 2015-2016.

 The company has a network of 609 offices and 75,000 agents across India.

 Shriram has an outstanding Underwriting Record and has awarded as ‘Underwriting

Initiative of the Year.’

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  Shriram Life Insurance generates more than 40% business through providing

insurance to rural area and weaker segment individuals - ‘AAM AADMI’ of India.

 The Founder of Shriram Group, Mr R Thyagarajan, has been awarded with Padma

Bhushan award.

We call our country as an “Advantage India” in the insurance sector because of these

four reasons:

Demand:

1. Growing interest in insurance among people due to increase in the knowledge;

innovative products and distribution channels aiding growth.

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2. Increasing demand for insurance off-shoring.

3. Growing use of internet has started increasing the demand.

Attractive opportunities:

1. Life insurance in low-income urban areas

2. Health insurance, pension segment

3. Strong growth potential for micro insurance, especially rural areas

Increasing investments:

1. Insurance sector companies in India have raised around Rs. 434.3 billion through public

issues in 2017

2. Increase in FDI limit to 49% from 26% approved in 2016

Policy Support:

1. Tax incentives on insurance products

2. Passing of Insurance bills gives IRDA flexibility to frame regulation

3. Repeated attempts to make the sector more lucrative for foreign participants

History of life insurance in India;

The history of insurance is probably as old as the story of mankind. In India, insurance has a

deep-rooted history. It finds mention in the writings of Manu (Manusmrithi), Yagnavalkya

(Dharmasastra) and Kautilya (Arthasastra). The writings talk in terms of pooling of resources

that could be re-distributed in times of calamities such as fire, floods, epidemics and famine.

This was probably a pre-cursor to modern day insurance. The same instinct that prompts

modern business-persons to-day to secure themselves against loss and disaster existed in

primitive men also. They too sought to avert the evil consequences of fire and flood and loss

of life and were willing to make some sort of sacrifice in order to achieve security.

In the year 1818, the modern Life Insurance came to India from England. Oriental Life

Insurance Company started by Anita Bhavsar in Kolkata (Calcutta) to cater to the needs of

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European community, was introduced as first life insurance company on the land of India. All

of the insurance companies which were in force at that time were working for the needs of

European Community, and were proving the insurance facilities to those companies. Indian

companies were not insured by the insurance company. Foreign insurance companies started

insuring the lives of Indian people. But the Indian lives were not given importance as

compare to the Europeans. Heavy amount was charged as premium from the Indian people.

In the year 1870, Bombay Mutual Life Assurance Society was established as first Indian life

insurance company and covered the lives of the Indian people at normal rates.

Insurance companies started working as an Indian organization with heavy patriotic

objectives. Insurance companies started working for the social welfare, security and to

provide security to the lives of Indian people. The insurance companies were willing to cover

the Indian lives from risk. The United India in Madras, National Indian and National

Insurance in Calcutta were established in 1906. In the year 1907, Hindustan Co-operative

Insurance Company was formed in Calcutta. Before 1912, No regulation was there in India to

regulate the insurance business. The Life Insurance Companies Act was passed in the year

1902. It was become essential that the insurance premium tables and periodical valuation of

insurance companies should be certified by an actuary, by the Life Insurance Companies Act

1912. The Indian insurance companies was put at a disadvantage by discriminated between

Indian and foreign companies on many accounts in Life Insurance Companies Act 1912. A

lot of growth was seen in the insurance business in twentieth century.

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In 19th Jan. 1956 the life insurance was nationalized. At the time of nationalization the whole

life insurance industry was organized by 245 units. In 245 units, 154 were Indian insurance

companies, non-Indian companies were 16 and 75 were provident funds. The process of

nationalization was completed in two stages. In the first stage, by mean of an ordinance, the

management of the insurance companies operating in India was taken over. In the second

stage, by means of a comprehensive bill, the ownership of the insurance companies operating

in India was also taken over. On 19th June 1956, Life Insurance Act was passed by the

parliament of India, with the objective to spread the awareness about insurance widely

specially in the rural areas with a view to cover all insurable people in India, the Life

Insurance Corporation of India was established on 1st September 1956. The aim of

establishing Life Insurance Corporation of India was to provide insurance and security cover

to the people of India on a reasonable premium. In the year 1956, apart from the corporate

offices, Life Insurance Corporation of India had 5 zonal offices with 33 divisional offices and

212 branch offices in India.

In the early 1990’s, it was felt that the insurance industry needs to be reformed in order to

provide better coverage to the customers and to increase inflow of long term financial

resources to finance the enhancement of infrastructure. In 1993, Malhotra Committee headed

by former Finance Secretary and RBI Governor Mr. R.N. Malhotra was formed to reform

Indian Insurance Industry and recommended its future direction. The Committee felt the need

to provide greater autonomy to insurance companies in order to improve their performance

and allow them to act as independent companies with economic motives. For this purpose, it

had proposed setting up of an independent regulatory body - The Insurance Regulatory and

Development Authority (IRDA).

Reforms in the Insurance Sector were initiated with the passage of the IRDA Bill in

Parliament in December 1999. The IRDA‟s incorporation as a statutory body in April 2000,

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has fastidiously stuck toils schedule of framing regulation and registering private sector

insurance companies.

IRDAI governs the Indian insurance sector:

IRDAI is responsible for regulating, promoting and ensuring orderly growth of the insurance

and reinsurance business in India.

India’s insurance market continues to be strong

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• The insurance industry is expected to reach USD280 billion by 2020. In 2016, around 46

private players were operating in the industry, while Life Insurance Corporation accounted

for 72.61 per cent of the country’s insurance market

• Individual single premiums received increased from USD0.16 billion in 2015 to around

USD1.02 billion in 2016

• Indian Government announced its plans to divest USD1.63 billion worth of stakes in PSU

general insurance companies to execute the steep disinvestment target of USD10.78 billion in

FY17

Premiums growing at a brisk pace

• The total insurance market expanded from USD23 billion in FY05 to USD68.88 billion in

FY16

• Over FY05–FY16, total gross written premiums increased at a CAGR of 10.49 percent

• Gross premium written in India for non life insurance sector for FY16 is USD14.33 billion

and in FY16, the gross premium written in India for life insurance sector stood at USD54.58

billion

• In November 2016, the total growth in life insurance premium was around USD 2.38 billion

as compared to USD 1.12 billion in November 2015, witnessing a growth of 113 per cent.

Similarly during the same period, the individual single premium grew by USD 995 million as

compared to USD 164.06 million in 2015, recorded a growth of more than 500 per cent

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Increasing private sector activity in life insurance segment:

Over the years, share of private sector in life insurance segment has grown from around 2

percent in FY03 to 29.6 per cent in FY16

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TYPES OF LIFE INSURANCE ARE:

1. Term Insurance: A term plan provides death risk cover for a specified period. In

case the life assured passes away during the policy period, the life insurance company

pays the death benefit to the nominee. It is a pure risk cover plan that offers high

coverage at low premiums. There’s an option to add riders to widen up the coverage.

The death benefit is payable as lump sum, monthly payouts, or a combination of both.

There’s no payout if the life assured outlives the policy term. However, these days

there are companies offering Term Plans with Return of Premiums (TROPS), where

insurance companies payback all the paid premium amount in case the life assured

outlives the term period. But, such plans are costlier than the vanilla term insurance

plan.

2. Unit Linked Plans: A unit linked plan is a comprehensive combination of insurance

and investment. The premium paid towards ULIP is partly used as a risk cover

(insurance) and partly is invested in funds. One can invest in different funds offered

by the insurance company depending on his risk appetite. The insurance company

then invests the accumulated amount in the capital market i.e. in bonds, equities,

debts, market funds, or a hybrid funds

3. Endowment Plan: Endowment plan is another type of life insurance plan, which is a

combination of insurance and saving. A certain amount is kept for life cover –

insurance, while the rest is invested by the life insurance company. In an endowment

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 plan, if the life assured outlives the policy term, the insurance company offers him the

maturity benefit. Moreover, endowment plans may offer bonuses periodically, which

4. Money Back Life Insurance: Money back plan is a unique type of life insurance policy,

wherein a percentage of the sum assured is paid back to the insured on periodic intervals as

survival benefit. Money back plans are also eligible to receive the bonuses declared by the

company from time to time. This way, policyholder can meet short-term financial goals.

5. Whole Life Insurance: A whole life insurance policy covers the life assured for whole

life, or in some cases, up to the age of 100 years. Unlike, term plans, which are for a specified

term. The sum assured or the coverage is decided at the time of policy purchase and is paid to

the nominee at the time of death claim of the life assured along with bonuses if any.

However, if the life assured outlives the age of 100 years, the insurance company pays the

matured endowment coverage to the life insured. The premiums are higher as compared to

term plans. Whole life insurance plans also offer partial withdrawals after completion of

premium payment term.

6. Child Plan: Child plan helps to build corpus for child’s future growth. Child plans help to

build funds for child’s education and marriage. Most of the child plans provides annual

instalments or one time pay-out after the age of 18 years. In case of an unfortunate event, the

insured parent passes away during the policy term -

are paid either on maturity or to the nominee under death claim. On death, the death benefit is

payable to the nominee.

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Endowment plans are also commonly known as traditional life insurance, although, there is

an investment component but the risk is lower than the other investment products and so are

the returns.

immediate payment is payable by the insurance company. Some child plans waive off the

future premiums on death of the life insured and the policy continues till maturity.

7. Retirement Plan: Retirement plan helps to build corpus for your retirement. Helping you

to live independently financially and without worries. Most of the child plans provide annual

installments or one time pay out after the age of 60 years. In case of an unfortunate event, life

assured passes away during the policy term - immediate payment is payable to the nominee

by the insurance company. Death benefit will be higher of coverage or fund value or 105% of

premiums paid. Vesting Benefit will be payable if the life assured survives the maturity age.

In which case, pay out will be fund value which has to be utilized for buying an annuity.

Channels of insurance industry

1. Direct channel: Direct marketing for the insurance sector is a marketing method used to

generate leads for insurance agents. Insurance brokers and companies use many direct

marketing methods to find new customers. Direct mail postcards and letters are two types of

traditional direct mail that are popular for insurance marketing. Many companies purchase

local lists and send lead-generation mailers out for their insurance brokers. Other types of

direct marketing used by the insurance sector include telemarketing, radio and television.

2. Bank assurance: Bank assurance or AllFinanz,is a relationship between a bank and an

insurance company, aimed at offering insurance products or insurance benefits to the bank's

customers. In this partnership, bank staff and tellers become the point of sale and point of

contact for the customer. Bank staff are advised and supported by the insurance company

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through wholesale product information, marketing campaigns and sales training. The bank

and the insurance company share the commission. Insurance policies are processed and

administered by the insurance company.

This partnership arrangement can be profitable for both companies. Banks can earn additional

revenue by selling the insurance products, while insurance companies are able to expand their

customer base without having to expand their sales forces or pay commissions to insurance

agents or brokers.

3. Agency channel: Agency is the largest distribution channel of almost all life insurance

companies, comprising a large advisor force that targets various customer segments. The

strength of agency channels lies in an aggressive strategy of expanding and procuring quality

business. With focus on sales & people development, tied agency has emerged as a robust,

predictable and sustainable business model. All life insurance companies have an agency-

building distribution strategy under which they recruit, train, finance, and supervise their

agent/advisers. For decades, agency was the only distribution channel for life insurance in

India.

4. Digital marketing: Insurers are using the Internet to provide general information of

financial service products (e.g., insurance, investments) and planning involving the use of

these products, to provide specific information of the company and its product lines, to

provide administrative support to its policyholders and to serve as a prospecting and

communication tool for its agent-led channel. The following methods are used for digital

marketing:

• SEO – Search Engine Optimization

• SEM – Search Engine Marketing

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• SMM- Social Media Marketing

Shift towards non linked insurance plan

The industry is witnessing a shift towards the traditional non-linked insurance plans

The share of non-linked insurance increased from 59.1 per cent in FY09 to 87 per cent in

FY16

Notable trends in the insurance industry

Emergence of new distribution channels:

• New distribution channels like ban assurance, online distribution and NBFCs have widened

the reach and reduced costs

• Firms have tied up with local NGOs to target lucrative rural markets

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• In April 2017, IRDAI started a web portal – isnp.irda.gov.in – that will allow the insurers to

sell and register policies online. This portal is open to intermediaries in insurance business as

well.

• India Post Payments Bank (IPPB) plans to start selling insurance products and mutual

funds of other companies by early 2018, and is to be open only to "non- exclusive" tie- ups.

Nearly 100 firms, domestic as well as foreign, have showed keen interest in partnering with

the bank

Growing market share of private players:

• • In the life insurance segment, share of private sector in the total premium increased

to 29.6 percent in FY16 from 2.0 per cent in FY03

• • In the non-life insurance segment, share of private sector increased to 41.2 per cent

in FY16 from 14.5 per cent in FY04

Launch of innovative products

• • The life insurance sector has witnessed the launch of innovative products such as

Unit Linked Insurance Plans (ULIPs)

• • Other traditional products have also been customised to meet specific needs of

Indian consumers

Mounting focus on Embedded Value over profitability

• • Large insurers continue to expand, focusing on cost rationalization and aligning

business models to realize reported Embedded Value (EV), and generate value from future

business rather than focus on present profits

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Porter’s five forces analysis:

Porter's Five Forces Framework is a tool for analyzing competition of a business. It draws

from industrial organization (IO) economics to derive five forces that determine the

competitive intensity and, therefore, the attractiveness (or lack of it) of an industry in terms of

its profitability.

Here is the Porter’s five force analysis of the Insurance industry:

Competitive Rivalry:

• Insurance Industry is becoming highly competitive with 52 players in the industry

• Companies are competing on price and also using low price and high returns strategy for

customers to lure them.

Threats of New Entrants:

• Other financial companies can enter the industry

• Overall threat is medium given that entry is subject to license and regulation

Substitute Products:

• Similarity in services makes switchover a potential threat

• Investment oriented customers have switched to other avenues

Bargaining Power of Suppliers:

• Supplier being the distributor or agent has high bargaining power because they have

customer database and can influence customers in making choices.

Bargaining Power of Customers:

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• Bargaining power of customers especially corporate is very high because they pay huge

amount of premium.

Growth drivers of insurance industry:

• The number of middle class households (earning between USD2,300 and USD30,800 per

annum) is estimated to increase more than fourfold to 234 million by 2025 from 113 million

in 2005 India’s robust economy is expected to sustain the growth in insurance premiums

written.

• Higher personal disposable incomes would result in higher household saving that will be

channelled into different financial savings instruments like insurance.

• Household savings reached US$ 388.20 billion in 2016 from US$ 89 billion in 2000.

• Financial savings have reached USD202.36 billion by 2015 from USD45 billion in 2000

• In comparison with its position in October 2016, till February 2017, insurance sector

witnessed growth at about 23 per cent.

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  Per capita income and rural income are increasing

 The number of middle class households (earning between USD2,300 and USD30,800

per annum) is estimated to increase more than fourfold to 234 million by 2025 from

113 million in 2005

 Rising per capita income leads to increased spending on medical and healthcare

services

 Lifestyle diseases are set to account for a greater part of the healthcare market

 Lifestyle diseases such as cardiac diseases, cancer and diabetes are treated with the

help of biotechnology products, thereby boosting revenues of biotech companies

• The growing GNI per capita, PPP of USD 6,020 in FY15 resulted in improved lifestyle due

to increased purchasing power of customers for healthcare

Strong potential through online services

• It is estimated that by 2020 three in every four insurance policies would be influenced by

online channel

• It is estimated that insurance sales through online channel will grow 20 times from now by

2020

Insurance @ Digital

The exploding popularity and reach of mobile phones, internet and social media has made

‘Digital’ a core part of life for many consumers across the globe. This megatrend is only

growing bigger exponentially. It is estimated that by 2020, three in every four insurance

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policies would be influenced by the digital channel either through pre-purchase stage,

purchase or renewal stage.

‘Digital’ is now a way of life. Let us look at some of the global facts:

• 6.7 billion mobile phone connections

• billions of internet users

• 1.7 billion social media users

This means that there are more mobile phone connections in the world than humans, nearly 2

out of 5 humans are already online and 1 out of every 4 is using social media.

The rapidly accelerated technology adoption which is shaping the digital economy is

due to the convergence of four mega trends:

• The world is going mobile

• Micro-transactions are the new norms

• Man is a social animal

• Big data leverage

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India is no different when it comes to digital and already has one of the largest digitl user

populations in the world:

• • 900 million mobiles (Globally #2)

• • 200 million Internet users (Globally #3)

• • 92 million Facebook Users (Globally #2)

Digital footprint, Digital influence and Digital sales

• While Digital Footprint represents how many customers of the product category have

internet access, Digital influence represents what fraction of the category buyers use the

Internet for any pre-purchase, purchase or service activity.

• The following figure shows the comparison between the digital influence and digital sales

in India:

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Search queries

• As per the BCG research in India, in case of insurance, digital influence is six times digital

sales in India. While a digital sale is 2%, the underlying digital influence is 12% and the

digital footprint is 31%.

• According to the Google Consumer Barometer 2013, search engines are the most popular

touch point for customers seeking information. Google search queries for insurance have

increased to 4.5X over the last 4-5 years. The following figure shows the multifold increase

in insurance search queries:

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Digital influence in different aspects of insurance purchase cycle

The BCC India study also shows high digital influence across all aspects of the insurance

purchase cycle in India. Commensurate with the overall development of the market, usage is

higher for simpler products like term life. The following exhibit shows the customer research

to understand the high digital influence across value chain:

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Customer research to understand the high digital influence across value chain

The following exhibit shows that Digital influence can be harnessed across the value chain

for both the customer and the company:

Digital influence can be harnessed across the value chain for both the customer and the

company

BCG predictions show that the life insurance Annualized New Business Premium is poised to

grow to 125-150k crore, with renewals expected to grow to Rs. 550-700k crore. Only 30% of

insurance buyers are completely non – digital today. This shows the kind of influence that

digital has on the people.

The “Life Insurance Benchmarking Survey Report” undertaken by BCG and FICCI reveal

that for participating life insurers, direct sales through online channels result in higher ticket

size of policies, with greater persistency and lower sales cost. As seen in the below exhibit,

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persistency is decisively higher for the digital channel across the 13th, 25th, 37th and 49th

month, compared to any other distribution channel. Additionally, the direct cost of each

channel as a percentage of annualized new business premium is lowest for the digital channel

at 11% compared to the agency channel which is close to 62%.

Digital Channel resulting in high persistency and low direct sales cost as compared to

other channels

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 The following exhibit shows the rise of digital footprint as per the locations in India:

Rise of Digital Footprints as per the locations in India

Hence, the digital economy is here to stay. The internet has gone from being a technical

wonder to being a business imperative. Digital is no longer an alternative; it is the core and

the new way of life.

Shriram Group:

The 76,000 Cr Shriram Group had its humble beginnings in the Chit Fund business over three

decades ago in Chennai. Mr. R. Thyagarajan, Mr. A.V.S. Raja and Mr. T.

Jayaraman were the “three musketeers” who ventured into the business. Not many in the

financial services industry thought at the time that this small Chit Fund business in Chennai

would become the foundation for the financial conglomerate that Shriram is today.

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Shriram Group’s businesses strive to serve the largest number of common people through its

pioneering and customized financial services. For more than 3 decades the tireless efforts for

facilitating financial access to small and medium entrepreneurs through loans and chits has

carved a niche for the Shriram Group in South India. The Founder Chairman has been

awarded the reputed title of “Padmabhushan” in the year 2013. The group actively serves

more than one crore customer across PAN India with strong prominence in the southern part

of the country.

The subsidiaries of the Shriram Group are listed as: Shriram Capital Limited and

Shriram Venture Limited.

Shriram Capital Ltd.

Shriram Capital Limited (SCL) is the overarching holding company for the Financial

Services and Insurance entities of the Shriram Group. Shriram Capital was created with the

35 | P a g e
primary objective of optimizing synergies across Group companies, apart from playing a

significant role in the Risk Management and Leadership development of these entities.

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SCL is the main promoter of the two high-growth listed companies of Shriram Group,

namely Shriram Transport Finance Company Ltd, the largest asset financing company in

India, and Shriram City Union Finance Ltd, a leader in Retail Finance across a wide range of

products. SCL is also the promoter of Shriram Life Insurance Company Ltd, and more

recently, Shriram General Insurance Ltd, Shriram Fortune Solutions, Shriram Insight Share

Brokers and Shriram Wealth Management. SCL’s main role is to promote these companies,

induct and strengthen leadership teams, provide strategic inputs and direction to help and

nurture them to grow into large and profitable enterprises.

On a consolidated basis, SCL has an overall customer base of 7.5 million, 35,000 employees

across 2,800 offices, with Assets under Management (AUM) of around US$ 11 billion.

Shriram Venture Ltd.

Shriram Venture Limited operates as a holding company which provides services in non-

financial businesses including power, infrastructure, construction, and real estate sectors.

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Years to remember:

1974-Shriram Capital Limited was set up in 1974. The company offers a wide range of

financial services from insurance, commercial vehicle finance, consumer and enterprise

finance, to wealth advisory services, along with domestic and overseas investment solutions.

It has strategic partnerships with Sanlam and Sanlam. Headquartered in Chennai, it has 3000

offices, over 60,000 employees, and a customer base of 12 million.

1974-Shriram Chits began operations in 1974 with a single branch and has since then grown

into a trusted household name, making Chits a viable form of saving and borrowing for all

segments of society. With a network of 465 branches spread across Tamil Nadu, Andhra

Pradesh, Karnataka and Maharashtra; Shriram Chits employs close to 5000 people. The

company has successfully built a reputation for timely disbursement and excellent customer

service.

1979-Shriram Transport Finance Company was founded in 1979 with the aim to finance

the much-overlooked Small Truck Owner. It is registered as a ‘Deposit-Taking NBFC’ with

the Reserve Bank of India under section 45IA of the RBI Act,1934. The Shriram Group had

the foresight to base their marketing based on aspiration, much before the concept became a

well-known one.

1986-Shriram City established in 1986 is India’s premier financial services company

specializing in retail finance. Its Consumer Finance business unit was set up in 2002 to cater

to chit fund customer needs. The company offers a comprehensive range of products making

it a dominant player. With over 1000 business outlets country-wide, it is listed on the BSE,

NSE, Madras Stock Exchanges and enjoys a high credit rating.

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2005-Shriram Life Insurance commenced operations in 2006. Synonymous for its efficient

use of capital and low operational costs, SLIC has been true to the Group‘s philosophy of

financial inclusion. A joint venture between Sanlam and Shriram Group, SLIC’s aim is to

offer life insurance plans and solutions that cater to a wider demographic. It has a network of

630 offices and 75,000 agents across India.

2006-Established in 2006, Shriram Financial Services Limited is a premier financial

distribution company that offers a plethora of financial planning solutions, primarily through

Mutual Funds, Life Insurance, General Insurance and Deposits. They are championed by the

expertise of 53,863 loyal Business Associates and 1146 employees, with a direct presence of

72 plus branches and an indirect presence in 289 locations.

2009-Identifying the opportunities coupled with India’s flourishing consumer markets,

Shriram Group made a foray into General Insurance. SGI’s focus on addressing customer

needs, nurturing talent and developing a home-grown technology platform for the

underserved segments of the economy has ensured the group’s sustainable growth for over

three decades. SGI received the Excellence in Growth Award in 2011 and 2012.

2011-Set up with the aim to provide financial assistance to prospective homeowners who

remain underserved, SHFL commenced operations in December 2011. Keeping in line with

their core philosophy of Finding Ways to Funding Homes; the company has developed

several innovative mortgage products.

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Philosophies of Shriram Group

The Shriram Group is driven by, and is well known for its philosophies which have been

impacted by Mr. Thyagarajan. These philosophies and values have been methodically

instilled and institutionalized into the Shriram group over the last 3 decades.

Serving the underserved thereby creating wealth in the community:

Mr. R. Thyagarajan has exceptional commitment in serving the underserved category of

customers (referred to as “aam-admi”), as this segment of customers are usually neglected by

the organized financial sector. These segments of customers have become the target market

for all Shriram Group companies in the financial services space.

Mr. Thyagarajan’s philosophy is that the group should only run enterprises which add

value to the community. Thyagarajan once said “Unless we have a useful role for the

community and customer, we will not enter the business. The businesses we enter must meet

the needs of the underserved sections of the economy”. For example, he felt that commercial

vehicle buyers should have been given a fair chance of survival and not be burdened with

high interest rates. He understood that they would be able to repay loans and it was just a

matter of time. Hence he realised that because these segment of customer were neglected by

other financial institutions, someone had to extend credit to them at reasonable rates.

This is how Shriram Transport came into business, with focus on the owner operators

(be it new or used vehicles). This segment has always been perceived as a high risk segment

to cater too. Today, Shriram Transport has grown to an AUM in excess of Rs 40,000 crore,

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a PAT in excess of Rs 1,200 crore, Market Capitalization in excess of Rs 13,000 crore, and a

customer base of 8, 00,000. In similar vain, one of the other NBFCs of Shriram (Shriram City

Union Finance) has over the last 10 years focused on SME’s (small medium enterprises- an

underserved segment), and has today grown to become a company with AUM in excess of Rs

13,000 crore, PAT in excess of Rs 350 crores, and a customer base of more than 3.7 million,

re-enforcing RT’s philosophy of “serving the underserved”.

Most of Shriram employees work in branches from the town they belong to. This allows the

employee to contribute back to the economy of the town to which they belong, and create

higher standards of living. In addition to this, as the employee is from the same background

of the customer, they are able to understand the customer well and build long lasting

relations. This is a prime reason due to which most employees are recruited in nearby

branches to where they live. Customer centric Community led approach was fostered as a

core philosophy of the group.

People first:

The Shriram’s group philosophy of putting “People first” is an integral part of the

organisation and is so well embedded in its cultural ethos that employee attrition rates are

under 10% and all the Chief Executives and senior management are home grown talent

having been in the group for 20 plus years. RT, along with the leaders he nurtured

painstakingly over the years, not only laid a sound foundation but also built an edifice of a

business model that is driven by one single philosophy – Creating a positive difference to the

lives and businesses of the Group’s customers. Today, the group has churned out leaders

consistently from its own erstwhile branch managers and field staff. Rather than identifying

41 | P a g e
businesses to be in, Mr. Thyagarajan has instead focused on creating management teams that

can build businesses- a very unique approach. Mr. Thyagarajan has always given his

employees utmost importance and made sure this has transformed to a value for the group

and all its leaders. He has formed a beneficiary trust in the group so that all management

leaders of the group are beneficiaries of the wealth created by the group. His philosophy is

that if there is any value created in the group, it should belong to the entire company and the

employees who have helped in creating this wealth. This is unique in the corporate world in

India given the large number of family owned businesses.

Empowerment:

Empowerment and freedom of operation have been deployed effectively across the Group,

resulting in an environment that is conducive to nurturing talent and allowing the exceptional

performance to blossom. This philosophy of the group has, over the years, created a win-win

situation for the group and its employees and continues to add unique value to the Group. Mr.

Thyagarajan has always encouraged those who have an entrepreneurial spirit as he has

always supported those who believe in starting a new business. This has allowed the

managers to create a business by being fully empowered, with the commitment of the group.

Investor relations:

Transparency levels are high in the group which has over the years increased investor

comfort and trust. Mr. Thyagarajan has always ensured that the group focuses not only on

providing a onetime transaction with its partners & investors, but on building a relation with

them in the long run. The group has high levels of transparency, unique values and

42 | P a g e
philosophies and gives importance to investor relations while offering high returns. Mr.

Thyagarajan has managed to attract 90 year old South African Insurance giant, Sanlam

Group, to partner with both the Life and General insurance businesses of the group. Both

these companies have managed to make profits in the last few years, unlike other insurance

players in the country. Mr. Thyagarajan has often stated “Our Company is not based on

transactions, but on relations with our financial and strategic partners”. The group has more

than 20 Private Equity investors who all have significant shares in group companies.

Frugal management:

Mr. Thyagarajan is a role model to many. He leads by exception in a relatively simple life,

and has transformed this to a philosophy of the group. Shriram Group doesn’t pay fancy

salaries to its employees, does not spend extravagantly, and tries to always optimize costs.

Mr. Thyagarajan believes that empowerment and freedom retain people within the group

rather than large salaries. This philosophy has been inculcated by the employees of the group

so well, that they have used the same philosophy to build simple offices and branches, as

opposed to spending extravagantly on the looks of offices and branches. All the operating

companies of the group have some of the best Cost/Income ratios within their respective

industries.

Vision of Shriram Group:

Mr. Thyagarajan’s vision for Shriram Group is to use the existing customer base and branch

network of the group to grow into the SME (underserved) and Insurance business, and

eventually become a large financial conglomerate serving the underserved through a

diversified range of financial products and services.

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This is one of the key reasons why Shriram has started focusing on financing of small

enterprises (SME’s) as there is a need to fund SME’s in the country. With the existing

network of Chits, this has proven to be a good move. The existing network of the group has

always been useful for starting new ventures. The same was in the case of the Insurance

business- The entry into Insurance was smooth due to the groups existing customers in truck

financing. Inclusive growth has always been a driving force for the group because of its

commitment, and it will continue to be, as the group grows and expands to new businesses

and verticals. The services of RT in the neglected sectors of the society will help shape the

group in good stand in its ambition to contribute to the Indian growth story in the years to

come.

About Founder Chairman:

Mr. R Thyagarajan (Popularly known as RT) holds a Masters in Mathematics and a Masters

in Mathematical Statistics (I.S.I).He is an associate at Chartered Insurance Institute (A.C.I,

London), and is a visiting faculty at the Asian Institute of Insurance, Philippines.

Prior to the humble beginnings of Shriram Chits, Mr. R Thyagarajan worked with New India

Assurance, from where he was strongly influenced by the then director, Mr. BK Shah. A lot

of the values and philosophies which RT has bought to the Shriram Group are taken from

what he learnt during his stint with New India Assurance and his own personal commitment

to the cause of the underserved. Mr. R Thyagarajan is founder of the Rs 60,000 crore Shriram

Group, headquartered in Chennai. Founded in 1974 to cater to the needs of the under banked

segment, the group has today grown to become India’s premier financial services network

chain.

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Over the last ten years, Shriram Group has grown at an enviable rate, with a CAGR of over

40%. The group has over 2400 branches, more than 45,000 employees, Net profit in excess of

Rs 15 billion and a strong customer base of 9.5 million. The group plans to expand its

businesses into non-financial services in the near future.

Shriram Life Insurance:

Shriram Life Insurance was incorporated in 2005 and it commenced business in 2006. Since

the first year of operations, the company made profits in the first three consecutive years-

becoming the only private life insurer to have achieved the distinction. Compared to industry

peers after 7 years of operation, Shriram Life insurance was the most profitable life insurance

company in the country. The company's performance stands out in efficient use of capital and

low cost of operations.

Life insurance arm of Shriram Group has carried forward the group philosophy of financial

inclusion by penetrating the unexplored segments. Shriram Life has significantly focused on

Inclusive growth by taking life insurance to the section where it is needed the most -The

'AAM AADMI' (Common Man). Sanlam, the second largest insurer in South Africa and

Shriram's Insurance partner, is working closely with the group to take the Insurance

Businesses to the next level in the coming years.

Vision of Shriram Life Insurance:

The Shriram Life Insurance Company is set out with the objective of reaching out to the

"common man" with a host of products and services that would be helpful to him in his path

to "prosperity". Efficiency in operations, integrity and a strong focus on catering to the needs

45 | P a g e
of the common man, by offering him high quality and cost-effective products and services,

are the values driving the organization. These core values are deep-rooted within the

organization and have been strongly adhered to over the decades. The company prides itself

on its perfect understanding of the customer. Each product or service is tailor-made to

perfectly suit the needs of the customer. It is this guiding philosophy of putting people first

that has brought the Group Company closer to the grassroots and has made it the preferred

choice for all the truck financing requirements amongst the customers.

CEO of Shriram Life Insurance:

Mr. Kromhout CEO of Shriram Life Insurance. With over 25 years of experience, Mr.

Casparus Kromhout is currently the Managing Director and CEO of Shriram Life Insurance,

a position which he has held since December 2015. Having begun his career in South Africa

in 1991, he worked as an Industrial Engineer with Iscor Mining (Kumba) where he focused

on optimization projects and business cases for new mine development.

He joined the Life Insurance industry with the opportunity to be part of the large strategic

program to re-engineer some of Sanlam’s processes and policy administration systems. He

worked as a Business Consultant and Project Manager with both Sanlam and Old Mutual,

delivering multiple strategic projects. He later focused on project portfolio value management

which includes value tree work, concept development, business case governance and benefit

realization. Early 2010 Sanlam requested Mr. Kromhout to take the COO assignment with

Shriram Life Insurance in Hyderabad; where he has been supporting and building the

46 | P a g e
organizational capabilities of this company, which is very successful in profitably reaching

out to a very tough market segment where the loss of a breadwinner can have disastrous

financial impacts on the family.

Based on his understanding of the insurance business of a matured life insurer like Sanlam

and the hands on experience in nurturing and developing the operations functions of Shriram

Life Insurance Co Ltd (SLIC), he was the right choice for the position of the CEO.

Apart from being a wonderful human being, his main strengths lie in ability to think ahead.

He never shies away from taking on new and innovative ideas; and executes them in a

practical and planned way. As a CEO Mr. Kromhout has been instrumental in developing and

executing strategy and is leading the drive towards further innovation, the use of digital

technologies and strategic ecosystem partnerships to expand the reach and business growth of

SLIC.

Partners of Shriram Life Insurance:

Sanlam Group

Mr. Johan van Zyl, Chairman of SanlamGroup. Sanlam is a South African financial services

group headquartered in Bellville, Western Cape, and listed on the Johannesburg Stock

Exchange and the Namibian Stock Exchange. Established in 1918 as a life insurance

company, Sanlam Group has developed over time into a diversified financial services

business.

Through its business clusters – Sanlam Personal Finance, Sanlam Emerging Markets,

Sanlam Investments, Sanlam Corporate and Sanlam – the group provides financial solutions

to individual and institutional clients across all market segments.

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The group's areas of expertise include insurance, financial planning, retirement, trusts, wills,

short-term insurance, asset management, risk management, capital market activities,

investment and wealth. The group operates in South Africa, Namibia, Botswana, Swaziland,

Malawi, Zambia, Tanzania, Rwanda, Uganda, Kenya, Ghana, Nigeria, Mozambique, India,

Malaysia and the UK and has business interests in the US, Australia and the Philippines. It

has a stake in leading global micro-insurance specialists; UK- based Micro-Ensure Holdings

Limited, which has a footprint across Africa and India servicing more than 10 million

enrolled clients.

Piramal Group

Mr. Ajay Piramal, Chairman of Piramal Group. The group calls themselves a global,

diversified conglomerate focussed on doing business with purpose. Valued at US$ 10 Billion,

Piramal Group is a global business conglomerate with interests in pharma, Financial Services,

Information Management, Glass Packaging and Real Estate. With 76,000+ staff and over 100

million customers, Piramal operates in India, US, UK, European Union, Japan and South

Asia.

The Group’s flagship company, Piramal Enterprises Limited, generates more than 51% of its

revenues from international markets. Piramal Foundation runs sustainable development

programs across healthcare, education and water resources. Piramal Sarvajal and Piramal

Swasthya, initiatives of the Foundation, are case studies at the Harvard Business School. By

2018, Piramal tends to carve out the financial services business from Piramal Enterprises,

which is dominated by the healthcare business. After selling his stake in Vodafone, Piramal

spent Rs. 2,014 crore to buy a 20% stake in Shriram Capital Ltd, an arm of the Chennai-based

Shriram Group. The purchase was made in addition to a Rs. 1,636 crore investment in

Shriram Transport Finance Co. Ltd, for 9.9% stake. Mr. Ajay Piramal also serves as the

Chairman of Shriram Group.

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HIGHLIGHTS OF SHRIRAM LIFE INSURANCE

• Shriram Life has more than 528 branches with over and above 1.45 crore customers.

• Shriram Life clocked Rs.1020 crore gross premiums in 2015-2016.

• The company has a network of 609 offices and 75,000 agents across India.

• Shriram has an outstanding Underwriting Record and has awarded as ‘Underwriting

Initiative of the Year.’

• Shriram Life Insurance generates more than 40% business through providing insurance to

rural area and weaker segment individuals - ‘AAM AADMI’ of India.

• The Founder of Shriram Group, Mr R Thyagarajan, has been awarded with Padma Bhushan

award.

BENEFITS OF SHRIRAM LIFE INSURANCE

• Financial Protection: Plans which provide financial protection to your family.

• Flexibility: Flexible premium and pay out options. • Online plans: Specifically designed

online plans that costs lower

• Variety: Offers a variety of online as well as offline plans

• Customer Service: Offers good, hassle-free pre-sales and post-sales services.

• Tax benefits: Save tax on all premiums and pay outs under the section 80C and 10(10D) of

Income Tax Act, 1961.

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DOCUMENTATION NEEDED TO APPLY FOR SHRIRAM LIFE INSURANCE

The most common type of documentation comprises of the following, the information on the

same is available on the official website of SLIC shriramlife.com/download-forms.

• Proposal Form: The form which is to be filled in by the insured in written or electronic or

any other format as approved by the authority, for furnishing all material information as

required by the insurer in respect of a risk, in order to enable the insurer to take informed

decision in the context of underwriting the risk, and in the event of acceptance of the risk, to

determine the rates, advantages, terms and conditions of the cover to be granted.

• Know Your Customer (KYC): Identity, address, income and age proof.

SWOT OF SHRIRAM LIFE INSURANCE

Strength:

• Insurance policies for all strata’s of society

• Policies with consideration for social Impact

• International expertise of Sanlam group

• Spread of 750 offices across India

• More than 75,000 loyal and dedicated agents and has a customer base of 30 lacs chit

subscribers and investors.

Weakness:

• Low key I.T infrastructure as compared to big brands

• Low Marketing and brand presence as compared to other competitors

• Insurance companies have a poor image when it comes to payment of dues

50 | P a g e
Opportunity:

• Growing rural market

• Earning Urban Youth looking for investments

• Cross selling through financial services such as banking

Threats:

• Stringent Economic measures by Government and RBI

• Entry of new NBFCs in the sector • Bajaj Allianz

• Sahara Life Insurance

• Reliance Life Insurance

COMPETITORS:

PRODUCTS OF SLIC

• Shriram life growth plus plan

• Shriram life assured income plus

• Shriram life online term plan

• Shriram life assured advantage plus

• Shriram life genius assured advantage plus

• Shriram life comprehensive cancer care

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• Shriram life my spouse term plan

Assured income plan

Entry age- 30 days to 50 years

Policy term- 8 years to 10 years

Sum assured- 10 lakh

Premium- 1 lakh annually

Maturity benefit-

I I. Lump sum- 118% of sum assured

II II. Regular pay out- 162% of annualized premium(factor rate 0.09)

Death benefit-

I I. Lump sum- 118%of sum assured

II II. Regular pay out- 162% of annualized premium

III III. 50% lumpsum+50% regular pay out

Assured income plus plan

It is also called as 555 plan.

Policy term- 10 years

Entry age- 8 years

Minimum entry age- 8 years

Maximum entry age- 60 years

Maximum maturity age- 70 years

Minimum premium- 25000

Paying period- 1 to 5 years

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Waiting period- 6th to 10th year

Returns- 11th to 15th year(double)

Death benefits-

I I. At the time of entered in this plan age is upto 50 years, 10 times return of

annualized premium.

II II. If the age is more than 50 years, 7 times return of annualized premium.

ULIP or Growth plus plan

Investment + Protection

(Stock market + insurance)

Policy term- 10 years or 15 to 20 years

Entry age- 1 month to 60 years

Maximum maturity age- 70 years

Options

• Single- 50k (one time)

• Regular- 30k annually

• Limited- 60k for 6 years

Death benefits-

I I. Sum assured + fund value

II II. Sum assured or fund value (whichever is higher)

53 | P a g e
Awards and accolades:

Mr. R. Thyagarajan received the Padma Bhushan award from former president of India Mr.

Pranab Mukherjee in the year 2013.

Mr. Manoj Kumar Jain managing director received the best CEO of the year BFSI award in

2015.

SLIC was awarded the BFSI award of best life insurance company in the year 2015.

Shriram Life Insurance Company received the bizz Americans 2016 award.

Best Indian insurance award for non -urban coverage – life insurance was awarded to shriram

life insurance by SP Noida Pvt Ltd.

Mrs. Akhila Srinivas, managing director was awarded Asia’s most powerful business woman

award in the year 2015.

SLIC was awarded the international arch of Europe award in Frankfurt 2015.

54 | P a g e
CHAPTER-2

55 | P a g e
 LITERATURE REVIEW

The review of literature has been made to find out the research gap and to identify the

relevant issues on the topic. It is important for a researcher to review the related literature in

order to have a clear knowledge about the topic and understand the research gap in order to

draw the scope for the study.

Athma. P and Kumar. R (2007) in the research paper titled “an explorative study of life

insurance purchase decision making: influence of product and non-product factors". The

empirical based study conducted on 200 sample size comprising of both rural and urban

market. The various product and non-product related factors have been identified and their

impact on life insurance purchase decision-making has been analyzed. Based on the survey

analysis; urban market is more influenced with product based factors like risk coverage, tax

benefits, return etc. Whereas rural population is influenced with non-product related factors

such as: credibility of agent, company’s reputation, trust, customer services. Company

goodwill and money back guarantee attracts many people for life insurance.

Girish kumar and eldhose (2008), published in insurance chronicle icfai monthly magazine

august 2008 in their paper titled "customer perception on life insurance services: a

comparative study of public and private sectors", well explained the importance of quality

services and its significance in raising customer satisfaction level. A comparative study of

public and private sectors help in understanding the customer perception, satisfaction and

awareness on various life insurance services.

56 | P a g e
Sahu et al, (2009); conducted a survey on 150 respondents to determine the attributes

affecting buying behavior of consumers, investment pattern in life insurance services and

compare the differences in consumer perception of male and female consumers. In their study

they found that there 6 factors which affect the buying behavior while purchasing life

insurance policies namely consumer loyalty, service quality, ease of procedures, satisfaction

level, company image and company client relationship. There is no difference between the

perception of male and female preferences.

Yadav and Tiwari (2012); the study area is limited to Jabalpur district, of Madhya Pradesh

and sample size of 150 policyholders is taken and the sample have been selected through a

satisfied and purposive sampling method. The study has been conducted to find out factors

influencing customer investment decision, impact of various demographic factors,

preferences of customers while taking the decision, and ranking of factors responsible for the

selection life insurance as an investment option. The study was conducted on 150 respondents

in their study on factors affecting customer investment in life insurance policies and found

the age, gender and income level. Out of 150 samples 54.6% of policy holders have invested

in LIC followed by SBI life insurance amongst private players. The features that

policyholders consider while making a purchase can be ranked as follows: company

reputation, money back guarantee, risk coverage, low premium and easy access to agents as

1st, 2nd, 3rd, 4th and 5th respectively. Thus it could be concluded that goodwill of the

company is the most influencing factor while policy buying decision. It was found that

majority of respondents preferred money back policy. While studying the reason for purchase

of insurance policy was most (54.6%) of the respondent’s have opted for LIC policies

because of safety and rest of the respondent’s opted for private players for higher returns. The

study area is limited to Jabalpur district, of Madhya Pradesh and sample size is 150

57 | P a g e
policyholders of LIC and different private life insurers have been selected through a stratified

and purposive sampling method.

Singh (2014); conducted a sample survey on 255 respondents of Uttar Pradesh to analyze life

insurance consumer behavior. Main purpose for which the study was conducted was to assess

the socio-economic status of respondents and to examine the impact of status on insurance

purchasing capacity. The study shows that maximum people invest for the purpose of tax

rebates and family safety. He found that major insurance products be child plan and pension

plan. He even found that maximum people like to get insurance product directly from

insurance agents followed by banks, financial institutions, and brokers. It was found that

government servicemen of 26-45 years of age buy more insurance products and middle

income group 100000-300000 people buy more insurance policies.

Sandeep Chaudhary (2016); has extracted six factors that influencing consumer behavior

namely customized and timely services, better company reputation, customer convenience,

better service quality, tangible benefits and effective customer relationship management. This

study revealed that new and innovative products will enhance better customer relationship

management basing on sample study of 100 respondents.

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N. Namasivayam, S. Ganesan and S. Rajendran (2006); study titled “Socioeconomic

factors influencing the decision in taking life insurance policies”. The objective of the study

was to analyze the socioeconomic factors that are responsible for taking life insurance

policies and to examine the preference of the policyholders towards various types of policies

of LIC. From the analysis it was found that factors such as age, educational level and sex of

the policy holders are insignificant but income level occupation and family size are

significant while deciding on taking an insurance policy. From the analysis, it is inferred that

respondents belonging to the age group between 31 to 40 years are very much interested in

taking a life insurance policy.

Kirubashiniv (1991); study was undertaken to know the level of awareness, preference and

factors influencing the policy holdings and to know the relationship between policy holdings

and influencing factor. The study found that majority of the respondents were aware of the

endowment policy and they preferred it as their choice. The study also revealed that there is

relationship between individual factors like age, gender, income and policy holdings.

59 | P a g e
CHAPTER-3

60 | P a g e
 OBJECTIVES OF THE STUDY

• To know the reach of Shriram life insurance product among people.

• To observe the number of policy holders of SLIC in prescribed location.

• To study about customer’s preference regarding life insurance companies.

• To examines the various factors that affect the consumer perception towards life insurance

policy

61 | P a g e
CHAPTER-4

62 | P a g e
 RESEARCH METHODOLOGY

Research methodology help us to know the research methods along the logic behind the

methods we use in the context of our research study and explain why we are using a

particular method or technique.

For getting better understanding of the Customers perceptions towards products of Shriram

life insurance company. The nature of study is qualitative. The methodology that is followed

includes primary data collection. Primary data collection is includes a simple questionnaire.

Such questionnaire is help us to ascertain the reach of Shriram Life Insurance products

among people, the awareness of insurance as a platform for investment and customer’s

preference regarding life insurance companies.

It is the comprehensive plan of the sequence of operations that a researcher intends to carry

out to achieve the desired research objective. It is a plan of action to be carried out in

connection with a proposed research work. The present study needs to chalk out the

customers perception towards products of Shriram Life Insurance Company.

Type of research- Descriptive research

Data source- Primary data

Data collection method- Interview and survey

Data collection tools- questionnaire

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Sampling Area- Noida

Sample size- 100

SOURCES FOR DATA COLLECTION:

The task of data collection begins after a research problem has been defined. In this study

data was collected through primary data source.

Primary Data: These are the data which are collected from some primary sources i.e., a

source of origin where the data generate. These are collected for the first time by an

investigator or an agency for any statistical analysis.

Primary data is used to find the answers of the objectives. The task of data collection begins

after a research problem has been defined and research design/plan chalked out. In this

particular study primary data has been collected from 100 respondents while keeping in mind

the objectives of the study. The primary data was collected through a self administered

questionnaire that contained questions relating to the objectives of the study. The

questionnaire contains certain question regarding awareness level and the attributes that

consumer consider while buying a life insurance policy.

SAMPLING TECHNIQUE:

Snowball sampling method is used to collect the data. It is the part of non-probability

sampling techniques. This method is commonly used in social sciences when investigating

hard-to-reach groups. Existing subjects are asked to nominate further subjects known to them,

so the sample increases in size like a rolling snowball. It is use to collect the data from the

customers of Life Insurance Companies in Noida. The questionnaire items used in this study

were developed based on previous questionnaire.

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SAMPLE DESIGN

The target population of the study consists of various respondents of various places. This

survey was done by collecting the data from the respondents.

SAMPLE SIZE

After due consultation with the company supervisor as well as with the college guide, also

keeping in mind the requirements of the company for the research, the sample size that was

found to be appropriate for the study was 100.

STATISTICAL TOOL

Simple percentage analysis is the main statistical tool used for the study.

Simple percentage analysis:

Percentage refers to a special king of ratio in making comparison between two or more data

and to describe relationships. Percentage can also be used to compare the relation terms

between two or more sources of data.

Percentage of respondents = Number of respondents / Total respondents

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CHAPTER-5

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 DATA ANALYSIS & INTERPRETATION

Data collection

The data was collected through a structured questionnaire.100 questionnaires distributed

among people in Noida and received back 100 questionnaires which were properly filled. 100

questionnaires is fairly attempted with 100% response.

DATA ANALYSIS

Data analysis focused on the following major aspects:

• • To know about the people insured through which insurance company in Noida.

• • To learn about the reason of insure by taking life insurance.

• • To know about the factors affected to choose a life insurance policy.

• • Awareness of insurance as a platform for investment among people of Noida.

• • To know the reach of Shriram Life Insurance products among people.

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1. Gender.

On the basis of respondents there are 72.3% male & 27.7% female who have insurance

policy.

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2. Age

There are 59% policy holders are have age upto 30 years, 26% of 31 – 40 years, 13% of 41 –

50 years & 2% of 51 – 60 years.

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3.Marital status.

On the basis of the respondents there are 58.4% policy holders who are married and rest are

unmarried.

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 4. Occupation.

On the basis of respondents there are policy holders in which 40.6% people who are doing

job, 22.8% people have business, 30.7% people are student & rest are having other

occupation.

5. Are you aware of Shriram life insurance company.

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On the basis of the study there are 57.1% people who are not aware about Shriram life

insurance and rest are aware.

6. Which company’s plan do you have or would you like to have ?

On the basis of respondents there are 41.6% are from LIC, 14.9% are from SBI life insurance,

12.9% are from ICICI Prudential, 10.9% are from HDFC Standard, 8.9% are from other &

2.9% are from Shriram life insurance.

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7. Total number of policies bought or plan to buy?

On the basis of the study there are 52% policy holders who avail only 1 plan, 27% are avail

more than 2 plans and 21% are avail 2 plans.

8. Which mode of payment of premium you obtain or would be obtain?

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On the basis of the study there are 39.6% policy holders who choose monthly mode of

payment, 32.7% are choose quarterly, 19.8% are choose yearly and rest are choose half

yearly mode of payment.

9. While buying your current life insurance policy, your decision was influenced by or

would be influenced by?

On the basis of respondents policy buying decision influenced 57% by own decision, 26% by

family, 13% by friends & colleagues & 4% influenced by advertisement.

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10. What kind of policy do you prefer or would you like to prefer?

There are 39.4% policy holders who have Money back plan, 20.2% are have Whole life

assurance, 17.2% are have Term insurance, 15.2% are have Endowment plan and rest are

have Unit linked plan.

11. Which one of the following factor motivated or would be motivated you to purchase

life insurance?

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There are the policy holders who motivated to purchase life insurance . In which 47% on the

basis of all of the above options, 20% by Financial stability, 18% by Helps achieve long-term

goals, 11% by tax benefits & rest are motivated by Retirement goals.

12. Do you think that these companies provide promised services as per the set

schedule?

According to the study there are 47% policy holders who are agree on that companies provide

services as per the set schedule, 42% are strongly agree & rest are neither agree or nor

disagree.

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13.Do you think that agents inform & guide the customers at regular intervals as

regards the policy status, due date of premium, new products & services?

On the basis of the study there are 83.8% policy holders who think that agents inform &

guide at regular intervals as regards the policy status, due date of premium, new products &

services and rest are not think the same.

14.How well do you thing, you are covered or would be covered by your life insurance

policy?

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On the basis of the respondents there are 55.6% think they are definitely well covered and

44.4% are think that they are probably well covered.

15.What is your overall perception about life insurance?

On the basis of the study we observe that 98% policy holders perception is positive

towards life insurance policy and 2% policy holders have negative perception towards life

insurance policy.

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CHAPTER-6

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 RESULTS & LEARNING OUTCOMES

The findings that can be drawn from the survey conducted by me can be summarized in the

following way:

 57.1 % People who are not aware of Shriram life insurance.

 Among the 100 insurance holder’s 43 respondents have policy of LIC whereas only

15 respondents have policy of SLIC (Shriram Life Insurance Company) and

remaining have policy of some other companies.

 27 respondents have only one policy, 21 respondents have two policies, and others

have three or more than policies.

 According to the survey all criterion is important as savings, tax benefits, covering

risk to life, security to family, which is expected among majorly respondents.

 According to the survey majorly respondents would like to pay ‘Monthly’ premium.

 According to the study premium, returns, goodwill of the company, duration of the

policy are to be highly important criteria which we consider before taking up a life

insurance.

 Majorly respondents said maybe they would choose Shriram Life Insurance for

buying new policy.

 According to this study majorly respondents prefer LIC other than Shriram Life

Insurance Company.

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CHAPTER-7

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 Conclusion

Insurance is a tool by which facilitates of a small number are compensated out of funds

collected from plenteous. Insurance is a safeguard against uncertain events that may occur in

the future. Since the first year of operations, Shriram Life Insurance made profits in the first

three consecutive years- becoming the only private life insurer to have achieved the

distinction. Compared to industry peers after 7 years of operation, Shriram Life insurance

was the most profitable life insurance company in the country, this progress leads to increase

the company image and makes a way to lead the total insurance market.

Life insurance is also now being regarded as a versatile financial planning tool. Research

indicates that Indians have four basic financial needs during their life - asset accumulation

(such as buying a house or car), protecting their family, securing their children education, and

provision for their retirement. So, while there are three basic types of insurance, these have

been structured with increased flexibility to meet focused requirements. Furthermore, these

can be enhanced with riders to protect one against disability and provide monetary

compensation at times of critical illnesses or surgeries.

India being a country having a huge population of around one billion people with only 22%

of the insurable population in India possessing life insurance the country has a vast potential

which has been left untapped till now.

The competition in the insurance sector is becoming so intense that it has become difficult to

identify the crucial success factors though the distribution strength will always be the key to

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success. Another area of vast improvement is in service attitude and delivery. Undoubtedly,

the biggest beneficiary of the competition amongst life insurers has been the consumer.

A wide range of products, customer-focused service and professional advice has become the

mainstay of the industry, and the Indian consumer has become the focus of each of the

company’s strategy.

Consumers today also seek products that offering flexible options, preferring products with

benefits unbundled and customizable to suit their diverse needs.

The trends in developed economies where people are not only live longer and retire earlier

are now emerging in India. With the breakdown of traditional forms of social security like the

joint family system, consumers are now concerning themselves with the need to provide for a

comfortable retirement.

This trend has been further driven by the long-term decline in interest rates, which makes it

all the more necessary to start saving early to ensure long term wealth creation. Today’s

consumers are increasingly interested in products to help build wealth and provide for

retirement income.

This all adds up to major change in demand for insurance products. Firms will need to

constantly innovate in terms of product development to meet ever-changing consumer needs.

Competition will result in the market to grow beyond current rates and offer additional

consumer choice through the introduction of new products, services and price options. With

the heightened awareness and consumer education comes a willingness to view life insurance

as an integral part of the financial portfolio. No longer is life insurance a poorly understood

product that is pushed onto people. Nor is it a product that is only to be bought hurriedly at

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the time of filing taxes. Its now catching on as an important element that is purchased to

fulfill specific rational and emotional needs and has clear benefits and advisors are being

trained to sell insurance as a solution to meet these needs.

To conclude with I would just like to say that the people preferences are changing regarding

insurances nowadays, earlier Insurance was a means for wealth creation and that too for a

longer period as returns were comparatively low but as compared with the data in the current

past it can be said that people are shifting towards Insurance sector not only for tax saving but

for future planning, life covering risk against security, etc. But again when compared with

other investment options people still prefer Bank Deposits, Equity & Mutual Funds because

they provide a higher percentage of return when compared with Insurance Sector.

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CHAPTER-8

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 LIMITATION

• The study was limited to the sample size of 100 respondents.

• As Researcher has collected the data by convenient sampling using questionnaire so

there was a possibility of certain deviations.

• Unwillingness on the part of the client to disclose the information as per the

questionnaire.

• Some respondents did not provide the full data.

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CHAPTER-9

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 RECOMMENDATION

• Shriram Life Insurance should focus on Extensive marketing in order to capture PAN

India market.

• SLIC uses only online channel to sale his policies to customers they should use

offline channel as well.

• Good image in transportation but customer are not aware of insurance of Shriram.

• In north area there is a need of more advertisement and promotion.

• Its products are less attractive than LIC.

• Its customer relationship is not good.

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CHAPTER-10

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 BIBLIOGRAPHY

• C.R. Kothari, Research Methodology: Methods and Techniques, second revised edition,

published by New Age International (P) Ltd. (2004, 1990, 1985).

• Hair, Joseph F, Arthur H. Money, Phillip Samouel, and Mike Page. Research Methods

for Business, 2007.

. • Ms Sunayna Khurana, Lecturer, ICFAI National College, Haryana: Customer

preferences in Life Insurance Industry in India.

• D Sidhardha, M Sumanth, Department of Management Studies: Consumer buying

behavior towards life insurance.

• Sandeep Chaudhary, Assistant Professor Lyallpur Khalsa College Jalandhar:

Consumer perception regarding life insurance policies.

• Ms Babita Yadav, Dr. Anshuja Tiwari, R.D.V.V Jabalpur: A study on factors affecting

customer’s investment towards life insurance policies.

• Dr. R. Padmaja, Shifaly Asst. Professor, P.G Department of Management Studies,

Krishna University: A study on investor’s perception towards LIC.

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WEB REFERENCES:

• https://www.coverfox.com/life-insurance/life-insurance-companies/shriram-life-insurance/

• https://shodhganga.inflibnet.ac.in/bitstream/10603/50603/5/ch-2.pdf

• https://shriramlife.com/

• https://docs.google.com/document/d/1B6Rk0qAnujorzZSTJr-oysAdY-

2FD9sJP3LVEeYgtEY/edit

•https://docs.google.com/document/d/1cse3WjGJlUYlgVR_co3Vz6stVBzPOb_x4Ncd8lJrng

Q/edit

• https://mail.google.com/mail/u/0?ui=2&ik=91c772f3fb&attid=0.4&permmsgid=msg-

f:1636839955936631336&th=16b739447fc4da28&view=att&disp=inline

• https://mail.google.com/mail/u/0?ui=2&ik=91c772f3fb&attid=0.2&permmsgid=msg-

f:1636839955936631336&th=16b739447fc4da28&view=att&disp=inline

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CHAPTER-11

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ANNEXURE

ANNEXURE-1

1. Name

2. Gender

 Female

 Male

 Other

3. Age

 Upto 30 years

 31 - 40 years

 41 - 50 years

 51 - 60 years

4. Marital status

 Married

 Unmarried

5. Occupation

 Job

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  Business

 Student

 Other

6. Are you aware of Shriram life insurance company

 Yes

 No

7. Which company's plan do you have or would you like to have?

 Shriram life insurance

 LIC

 Bajaj Allianz life insurance

 ICICI Prudential

 SBI life insurance

 HDFC Standard

 other

8. Total number of policies bought or plan to buy?

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  1

 2

 More than 2

9. Which mode of payment of premium you obtain or would be obtain?

 Monthly

 Quarterly

 Half yearly

 Yearly

10. While buying your current life insurance policy, your decision was influenced by

or would be influenced by?

 Own decision

 Family

 Family & Colleagues

 Neighbours

 Advertisement

11. What kind of policy do you prefer or would you like to prefer?

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  Endowment plan

 Money back plan

 Whole life assurance

 Unit linked plan

 Term insurance

12. Which one of the following factor motivated or would be motivate you to

purchase life insurance?

 Financial stability

 Helps achieve long-term goals

 Retirement goals

 Tax benefits

 All of the above

13. Do you think that these companies provide promised services as per the set

schedule?

 Strongly agree

 Agree

 Neither agree or nor disagree

14. Do you think that agents inform & guide the customer at regular intervals as

regards the policy status, due date of premium, new products & services?

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  Yes

 No

15. On which behalf will you recommend the same corporation to others for taking up

the policy?

 Product attributes

 Product services

 Risk coverage aspect

16. What is your overall perception about life insurance policy?

 Positive

 Negative

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