Professional Documents
Culture Documents
1
companies
11. Competitors of SBI Life 53 - 62
12. Comparison of ULIP products 63 - 69
13. Questioner 70 - 71
14. Conclusions and findings 72 - 91
15. Recommendations 92
1. Project proposed
Agency business model of different insurance companies- competitive
strategies.
Different agencies of different insurance companies are having some
strategies to survive in the market. Their strategies may be in the form of:
• How they target their customers.
• How they make their advisors active.
• How they make their operational and sales department effective.
• How they promote their employees.
• How they handle the conflict in agency.
2
Objective of the project: - Main objective of the project is to find out
the strategies of different insurance agencies and evaluate them. Project is
about to penetrate the competitors of SBI life. Conclusion of this project can
give an idea of strategies of different companies which may be helpful to the
company. Now days all the insurance companies in India are trying to
establish themselves in the competitive market. They are introducing
innovative marketing strategies to survive in the market. Many other private
companies are looking to enter in the Indian insurance market .so it is very
essential to a company to innovate their marketing strategies in terms of
Methodology
3
Research is totally based on primary data. Secondary data can be used only
for the reference. Research has been done by primary data collection, and
primary data has been collected by meeting with the branch and agency
manager of different insurance agencies and branches in Calicut. Data
collection has been done through by giving structured questioner. Research
has been done after 27 branch managers or agency manager. This study will
be based on judgment sampling and this research is skewed to organization
level. This is an exploratory type of research. And this research needs
further study also Research is a kind of pilot study.
Sampling
Sample size has been taken by judgment sampling. Judgment sampling is a
process in which the selection of a unit, from the population is based on the
pre judgment. This research requires the survey of different insurance
agencies in Calicut city. So research concentrates on the branch or agency
manager of different insurance companies. So the selection of unit for this
research has been judged by the researcher. Sample size for this research is
27.
Limitations:
• Time limitation
• Research has been done only in Calicut.
• Companies did not disclose their secrets data and strategies.
• Possibility of Error in data collection.
• Possibility of Error in analysis of data due to small sample size.
4
2. Introduction
The story of insurance is probably as old as the story of mankind. Tendency
of a human being to secure themselves against loss and disaster has been
from the starting of world. They 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. Though the concept of 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 as per records.
5
• Life Insurance
• Fire
• Marine
• Miscellaneous Insurance.
Insurance provides:
• Protection to investor.
• Accumulation of savings.
• Channeling these savings into sectors needing huge long term
investment.
Functions of insurance:
• Provide protection: The primary function of insurance is to provide
protection against future risk, accidents and uncertainty. Insurance
cannot check the happening of the risk, but can certainly provide for
the losses of risk. Insurance is actually a protection against economic
loss, by sharing the risk with others.
6
insured contribute the premiums towards a fund and out of which the
persons exposed to a particular risk is paid.
7
• Source of earning foreign exchange: Insurance is an international
business. The country can earn foreign exchange by way of issue of
marine insurance policies and various other ways.
Life insurance:
Life insurance is a contract under which the insurer (Insurance Company) in
Consideration of a premium paid undertakes to pay a fixed sum of money on
The death of the insured or on the expiry of a specified period of time
Whichever is earlier. In case of life insurance, the payment for life insurance
policy is certain. The Event insured against is sure to happen only the time
of its happening is not known. So life insurance is known as ‘Life
Assurance’. The subject matter of insurance is life of human being. Life
insurance provides risk coverage to the life of a person. On death of the
person insurance offers protection against loss of income and compensate
the titleholders of the policy.
8
• Life insurance as risk cover: - Insurance is all about risk cover and
protection of life. Insurance provides a unique sense of security that
no other form of invest can provide.
9
insurance is an important tool for the mobilization and investment of
small savings.
• Credit worthiness: - Life insurance policy can be used as a security
to raise loans. It improves the credit worthiness of business.
• Social Security: - Life insurance is important for the society as a
whole also. Life insurance enables a person to provide for education
and marriage of children and for construction of house. It helps a
person to make financial base for future.
• Tax Benefit: - Under the Income Tax Act, premium paid is allowed
as a deduction from the total income under section 80C.
10
Insurance is now governed by a blend of statutes, administrative agency
regulations, and court decisions. State statutes often control premium rates,
prevent unfair practices by insurers, and guard against the financial
insolvency of insurers to protect insureds.
Insurance agencies:
Insurance agency can be defined as a group of insurance agents or advisor.
These agents or advisors create a distribution channel to sell the different
insurance products. These advisors are the strongest distribution channel for
an insurance agency. An advisor or agent works as a third party or
intermediate between insurance company and customers. All the advisors in
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an agency work as a team. Main work of insurance advisor or agent is to
promote and sell different insurance products of company.
12
In the reference to the SBI Life insurance, development of insurance
products, distribution, planning services products and claims are taken care
by the head office. Back office providers are those persons who take care of
the operational part of the organization and front office providers are the
people who brings sell to the organization. Back office has its own hierarchy
which is connected to head office, and every policy has to be processed to
head office. Unit for the operations is known as processing centre, and
processing centre within the city is known as mini processing centre.
Proposal forms come through front office and the verification of the
proposal is done by manually which is known as scrutiny. After scrutiny the
operational staff enters it in SBI Life website, which is done online. the
entry of a proposal is done in a sequential order starting with scrutiny,
inwards, proposal wise inwards, cashier entry, cashier entry approval, data
entry and finally outwards. After finishing all these operations policy issues
from the head office of the state.
13
To regulate Indian insurance business first insurance act came
in 1912 as life insurance company act and provident fund act. These acts
consist of premium rates tables and periodical valuations of companies. In
the first two decade of 20th century many life insurance companies were
started. So the insurance act came in 1938 to governing life and non life
insurance companies and to provide strict state control. In 1956 the life
insurance business in India was nationalized. In 1956 life insurance
corporation of India (LIC) was created to spreading life insurance much
more widely particularly in rural areas. In that year LIC had 5 zonal offices,
33 divisional offices and 212 branch offices. In 1957 the business of LIC of
sum assured of 200crores, 1000crores in 1970, and 7000crores in 1986.
14
regulations ranging from registration of companies for carrying on insurance
business to protection of policyholders’ interests.
Role of IRDA:
• Protecting the interests of policyholders.
• Establishing guidelines for the operations of insurers, and brokers.
• Specifying the code of conduct, qualifications, and training for
insurance intermediaries and agents.
• Promoting efficiency in the conduct of insurance business.
• Regulating the investment of funds by insurance companies.
• Specifying the percentage of business to be written by insurers in rural
sectors.
• Handling disputes between insurers and insurance intermediaries.
15
Indian customers have become very sensitive to Coverage / Premium as well
as the Products (read Risk Solution), that is given to them. There are not
ready to accept any product, no matter even if that is coming from the
market leader, should that product is not serving the purpose. A case in point
is ULIP Product / Group Life and Credit Life in Life Insurance segment and
Travel / Family Floater Health and Liability Insurance in the Non-life
segment are new age Avatar. The new products are constantly being
demanded by Indian consumers, which is putting huge pressures on
Insurance companies (Read Risk Under-writers) and Brokers to respond.
Customers are looking at Insurance for covering Pure Risk now which I
have covered in my next section. Another good reason why we are seeing
quick changes in the buying behavior of Insurance from mere Investment to
risk mitigation is the cost of Replacement of Goods (ROG) or Cost of
Services (COS).
Now Indian customers are aware of insurance industry and insurance
products provided by companies. They have become more sensitive. They
would not accept any type of insurance product unless it fulfills their
requirements and needs. In historic day’s customers looking at insurance
products as a life cover which can provide security against any unacceptable
events, but now customers look at insurance products as an investment as
well as life cover. So today’s customers wants good return from the
insurance companies. The Indian customer’s forms the pivot of each
company’s strategy.
16
BANK DEPOSITS 39%
CORP. BANKS 2%
SHARES AND DEBENTURES 1%
MUTUAL FUNDS 2%
NBFC’S 3%
GOVT. BONDS 13%
INSURANCE 13%
PF/ RETIRE FUNDS 21%
CURRENCY 6%
17
demanding for higher returns with the life risk cover and private companies
are giving 30-40% average growth per annum. These life-insurance
companies have every kind of policies suiting every need right from
financial needs of, marriage, giving birth and rearing up a child, his
education, meeting daily financial needs of life, pension solutions after
retirement. These companies have every aspects and needs of our life
covered along with the death-benefit.
18
Today, the Indian life insurance industry has a dozen private
players, each of which are making strides in raising awareness levels,
introducing innovative products and increasing the penetration of life
insurance in the vastly underinsured country. Several of private insurers
have introduced attractive products to meet the needs of their target
customers and in line with their business objectives. The success of their
effort is that they have captured over 28% of premium income in five years.
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6 bank owned insurers: - HDFC standard life, ICICI prudential, ING
Vysya, MetLife, OM Kotak, SBI life.
6 independent insurers: - Aviva, ANP sanmar, Birla sun life, Bajaj Allianz,
Max New York life, Tata AIG.
Major international insurers are- Prudential and
Standard life from UK, Sun life of Canada, AIG, MetLife and New York life
of the US.
20
• Consolidation of domestic insurance markets.
• Technology driven shift in product design.
• Actual operations and distribution.
• Convergence of financial services.
products.
21
Global insurance market is increasing by an average of six
percent per year since 1990. Insurance companies have collected $2443.7
billion premium world wide according to the global development of
premium volume in 144 countries in 2005. $1521.3 has been generated as
life insurance premium and $922.7 as non life insurance premium. The US
accounted for 35% of global life and non life premium, Japan had global
share of 21%, and UK was having 10% of global share.
22
Korea 7.3%
United states 4.1%
Malaysia 3.6%
India 3.0%
China 1.8%
Brazil 1.3%
Source: - www.indianinsuranceresearch.com
Insurers make money in two ways: (1) through underwriting, the processes
by which insurers select the risks to insure and decide how much in
premiums to charge for accepting those risks and (2) by investing the
premiums they collect from insured.
23
termination of a given policy, the amount of premium collected and the
investment gains thereon minus the amount paid out in claims is the insurer's
underwriting profit on that policy.
24
Investment management:
Investment operations are often considered incidental to the business of
insurance, and have traditionally viewed as secondary to underwriting. In
the past risk management was the most important part of business, whereas
today the focus has shifted to fund management. Investment income is a
large component of insurance revenues, skilful and careful management of
funds. Insurance is a business of large numbers and generates huge amount
of funds over time. These funds arise out of policyholder funds in the case of
life insurance, and technical and free reserves in the non-life segments. Time
lag between the procurement of premium and the payment of claim provides
an interval during which the funds can be deployed to generate income.
Insurance companies are among the largest institutional investors in the
world. Assets managed by insurance companies are estimated to account for
over 40% of the world’s top ten asset managers.
Returns on investments influence the premium rates and
bonuses and hence investment income will continue to be an important
component of insurance company profits. In life insurance, benefits from
insurance profits accrue directly to policy holders when it is passed on to
him in the form of a bonus. In non life insurance the benefits are indirect and
mostly by the creation of an investment portfolio. Investment income has to
compensate for underwriting results which are increasingly under pressure.
In the case of insurance, the difference between revenue and the expenses is
known as operating surplus.
Revenue =premium.
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Expenses =sum of claims + commission payable on procurement of
business + operating expenses.
Operating surplus =revenue-expenses.
Net investment income includes income from trading in and holding stock
market securities including government securities, special deposits with the
central government, loans to several public utilities and service providers in
state government.
Insurance premium collected is converted in a pool of fund
then divided in to four expenses.
• To pay the expenses of the management.
• To pay agency commission.
• To pay for the claims.
• Surplus money will be invested in govt. securities.
Insurance normally insure only pure risks .However, not all pure risk is
insurable .certain requirements usually must be fulfilled before a pure risk
can be privately insured .From the view point of the insurer, there are ideally
six requirement of an insurable risk
26
• The loss should not be catastrophic.
27
if the loss does occur .Moreover, consistent gambling transaction generally
never restore the losers to their former financial position .In contract
,insurance contracts restore the insured’s financially in whole or in part if a
loss occurs
28
conditions .The risk is transferred, not reduced, and prediction of loss
generally is not based on the law of large numbers.
29
• Joint life insurance policies: These policies are similar to
endowment policies in maturity benefits and risk cover, but joint life
policies cover two lives simultaneously such as married couples. Sum
assured is payable on the first death and again on the death of survival
during the term of the policy.
30
become more predictable, and with system wide risks balanced out,
profits improve. This explains the current scenario of mergers,
acquisitions, and globalization of insurance.
• Insurance is a type of savings. Insurance is not only important for tax
benefits, but also for savings and for providing security. It can be
serving as an essential service which a welfare state must make
available to its people.
• Insurance play a crucial role in the commercial lives of nations and
act as the lubricants of economic activities. Insurance firms help to
spread the potentially financial consequences of risk among the large
number of entities, to mobilize and distribute savings for productive
use, facilitate investment, support and encourage external trade, and
protect economic entities against external risk.
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require long term funds. There is thus a mutually beneficial interaction
between insurance and economic growth. The low income levels of the vast
majority of population have been one of the factors inhibiting a faster
growth of insurance in India. To some extent this is also compounded by
certain attitudes to life. The economy has moved on to a higher growth
path. The average rate of growth of the economy in the last three years was
8.1 per cent. This strong growth will bring about significant changes in the
insurance industry.
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8. SBI Life insurance
SBI Life insurance is a joint venture between the State Bank of India and
Cardiff SA of France. SBI Life insurance is registered with an authorized
capital of Rs 500 crore and a paid up capital of Rs 350 crores. SBI owns
74% of the total capital and Cardiff the remaining 26%. State Bank of India
enjoys the largest banking franchise in India. Along with its 7 Associate
Banks, SBI Group has the unrivalled strength of over 14,000 branches
across the country, the largest in the world.
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personal lines such as long-term savings, protection products and creditor
insurance. Cardiff has also been a pioneer in the art of selling insurance
products through commercial banks in France and 29 more countries .In
2004, SBI Life insurance became the first company amongst private
insurance players to cover 30 lakh lives.
34
This means that you get an Rs 12,000 tax benefit. The rebate is deductible
from the tax payable by an individual or a Hindu Undivided Family.
35
(1) Unit Linked products (1) Group Employee Benefit
Products
• Horizon 11 Retirement Solutions
• Cap Assure Gratuity
• Unit Pus 11
• Cap Assure Superannuation
• Unit plus child Plan
• Cap Assure Leave
• Unit Plan Elite
Encashment
(2) Pension Products
• Group Immediate Annuity
• Horizon 11 Pension
• SBI Life Golden Gratuity
• Unit Plus 11 Pension
Protection Plan
• Lifelong Pension • Sampoorn Suraksha
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9. Distribution of insurance products
Insurance has to be sold the world over. The Touch point with the ultimate
customer is the distributor or the producer and the role played by them in
insurance markets is critical. It is the distributor who makes the difference in
terms of the quality of advice for choice of product, servicing of policy post
sale and settlement of claims. In the Indian market, with their distinct
cultural and social ethics, these conditions will play a major role in shaping
the distribution channels and their effectiveness. In today's scenario,
insurance companies must move from selling insurance to marketing an
essential financial product. The distributors have to become trusted financial
advisors for the clients and trusted business associates for the insurance
Companies.
37
• Agents: Agents are the primary channel for distribution of
insurance. The public and private sector insurance companies have
their branches in almost all parts of the country and have attracted
local people to become their agents. Today's insurance agent has to
know which product will appeal to the customer, and also know his
competitor's products to be an effective salesman who can sell his
company, the product, and himself to the customer. To the average
customer, every new company is the same. Perceptions about the
public sector companies are also cemented in his mind. So an
insurance agent can play an important role to create a good image of
company.
• Banks: Banks in India are all pervasive, especially the public sector
banks. Many insurance companies are selling their products through
banks. Companies which are bank owned, they are selling their
products through their parent bank. The public sector banks, with their
vast branch networks, are helpful to insurance companies. This
channel of selling insurance is known as Banc assurance.
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INSURANCE COMPANY ASSOCIATE BANKS
ICICI prudential ICICI bank, bank of India, Citibank,
Allahabad bank, Federal bank, south
Indian bank, Punjab and Maharashtra
cooperative bank
SBI life State bank of India
Birla sun life Deutsche bank, Citibank, bank of
Rajasthan, Andhra bank
ING Vysya bank Vysya bank
Aviva life insurance ABN amro bank, canara bank
HDFC standard life Union bank, Indian bank
Met life Karnataka bank, j&k bank
39
• Internet: In this technological world internet is also a channel of
selling insurance. This can be as direct marketing.
40
Now the Indian consumer is knowledgeable and sensitive. Consumers are
increasingly more aware and are actively managing their financial affairs.
People are increasingly looking not just at products, but at integrated
financial solutions that can offer stability of returns along with total
protection. In view of this, the insurance managers need to understand more
about the details that go into the introduction of insurance products to make
it attractive in this competitive market. So now days an insurance manager
requires leadership, commitment, creativity, and flexibility. "Every family
in every village in the country should feel safe and secure". This vision
alone will help to bring the new ideas to the insurance manager.
41
• Effective pricing.
• Customer satisfaction research.
42
payment plans, risk management advice, and convenient and quick claim
handling.
43
strategies more for survival than growth. But the most important gift of
privatization is the introduction of customer-oriented services. Utmost
care is being taken to maximize customer satisfaction.
44
• Control over investment and operating costs: Control over
resources such as men, machines, and materials at each level of the
organization provides measures of efficiency of a unit as well as the
organization. Investment control and expense control are dealt
separately and the effectiveness of management’s’ decisions at
various levels is to be assessed separately
45
Effective strategies for insurance agents:
46
11. Competitors of SBI life insurance
ICICI prudential: ICICI prudential insurance is a joint venture of ICICI
bank and prudential plc a leading financial service group in the UK. Total
capital stands for Rs. 37.72 billion, with ICICI Bank holding a stake of 74%
and Prudential plc holding 26%. ICICI begin their operations in December
2000 after receiving approval from IRDA. Now ICICI prudential is having
over 1000 offices, over 270000 advisors and 21bancassurance partners.
ICICI Prudential was the first life insurer in India to receive a National
Insurer Financial Strength rating of AAA from Fitch ratings. ICICI
prudential is working on the base of five core values-
• Integrity
• Customer first
• Boundary less
• Ownership
• Passion
Key features:
47
HDFC standard life insurance: HDFC Standard Life Insurance Company
Ltd. is one of India's leading private insurance companies. It is a joint
venture of Housing Development Finance Corporation Limited, India's
leading housing finance institution and a Group Company of the Standard
Life in UK. HDFC as on March 31, 2007 holds 81.9 per cent of equity
venture. Gross premium income of the HDFC for the year ending March 31,
2007 was Rs. 2, 856 crores and new business premium income was Rs.
1,624 crores. The company has covered over 8, 77,000 lives year ending
March 31, 2007. HDFC standard is having 1000 advisors in 11 towns.
Key features:
48
Aviva life insurance: Aviva is UK’s largest and the world’s fifth largest
insurance Group. It is one of the leading providers of life and pensions
products to Europe and has substantial businesses elsewhere around the
world. Aviva has a joint venture of Dabur, one of India's oldest, and largest
Group of companies. And country's leading producer of traditional
healthcare products. In accordance with the government regulations Aviva
holds a 26 per cent stake in the joint venture and the Dabur group holds the
balance 74 per cent share. Aviva has 193 Branches in India (including rural
branches) supporting its distribution network. Through its Banc assurance
partner locations, Aviva products are available in more than 2,795 locations
across India. Aviva has a sales force of over 30000 financial planning
advisors.
Key features:
• Through the “Financial Health Check” (FHC) Aviva’s sales force has
been able to establish its credibility in the market. The FHC is a free
service administered by the FPAs for a need-based analysis of the
customer’s long-term savings and insurance needs. Depending on the
life stage and earnings of the customer, the FHC assesses and
recommends the right insurance product for them.
• Introduced the concept of Banc assurance in India.
• Products to provide customers flexibility, transparency and value for
money.
• Differentiation in fund management operations.
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MetLife insurance: MetLife India Insurance Company Limited is an
affiliate of MetLife, Inc. and was incorporated as a joint venture between
MetLife International Holdings, Inc.and The Jammu and Kashmir Bank, M.
Pallonji and Co. Private Limited and other private investors. MetLife is one
of the fastest growing life insurance companies in the country. It offers a
range of innovative products to individuals and group customers at more
than 600 locations through its bank partners and company-owned offices.
MetLife has more than 32,000 Financial Advisors. It has approximately 70
million customers all over world. MetLife is working on the base of six core
values-
• Innovation
• Long term relationship
• Customer centered and result focused vision
• Creating high performance organization
• Working with integrity, fairness and financial prudence
• Partnering with internal and external customers
Max New York life insurance: Max New York Life Insurance Company
Ltd. is a joint venture between New York Life, a Fortune 100 company and
Max India Limited, one of India's leading multi-business corporations The
Company's paid up capital is Rs. 907.4 crore. Max New York life is working
on the base of six core values-
• Excellence,
• Honesty,
• Knowledge,
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• Caring,
• Integrity
Key features:
• Max New York Life has adopted prudent financial practices to ensure
safety of policyholder's funds.
• Investing significantly in its training programme and each agent is
trained for 152 hours as opposed to the mandatory 100 hours
stipulated by the IRDA before beginning to sell in the marketplace.
• Using a five-pronged strategy to pursue alternative channels of
distribution which include the franchisee model, rural business, direct
sales force involving group insurance and telemarketing opportunities,
banc assurance and corporate alliances.
Bharti Axa life insurance: Bharti Axa life insurance is a joint venture
between Bharti, one of India’s leading business groups with interests in
telecom, agri business and retail, and Axa world leader in financial
protection and wealth management. The joint venture company has a 74%
stake from Bharti and 26% stake of Axa. The company started its operations
in December 2006. Now company is having over 5200 employees across
51
over 12 states in the country. Company is working on the base of five core
values-
• Professionalism
• Innovation
• Team Spirit
• Pragmatism
• Integrity
Key features:
Tata AIG life insurance: Tata AIG Life Insurance Company Limited (Tata
AIG Life) is a joint venture company of the Tata Group and American
International Group, Inc. (AIG). The Tata Group holds 74 per cent stake in
the insurance venture with AIG holding the balance 26 percent. Tata AIG
Life provides insurance solutions to individuals and corporate. Tata AIG
Life Insurance Company started to operate its business in India on April 1,
2001. Tata AIG is having 3000 advisors all over India.
52
Key features:
Bajaj Allianz life insurance: Bajaj Allianz life insurance company ltd. Is a
joint venture of Allianz AG, one of the world’s largest insurance companies
and Bajaj auto, one of the biggest two and three wheeler manufacturing
companies in the world. Company is having over 440000 satisfied customers
in India. Company is having 550 branches across the country and over
60000 advisors.
Key features:
ING Vysya life insurance: ING Vysya Life Insurance Company Limited a
part of the ING group the world’s largest financial services provider entered
in the private life insurance industry in India in September 2001.ING Vysya
Life is currently present in 246 cities and has a network of over 300
branches, staffed by 7,000 employees and over 51,000 advisors, serving
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over 5.5 lakh customers. ING Vysya Life has a diversified distribution
channels,. While Tied Agency remains the strongest channel, the Alternate
Channels business within ING Vysya Life is one of the fastest growing
distribution channels. ING Vysya Life has strengthened its position as the
unparallel leader in the life insurance industry in cooperative banks tie ups.
The company currently has tie ups with 130 cooperative banks across the
country. The Alternate Channels division has Banc assurance, ING Vysya
Bank, Corporate Agents and SMINCE. ING Vysya is working on the base
of five core values-
• Professionalism
• Entrepreneurial
• Trustworthy
• Approachable
• Caring
Birla sun life insurance: Birla Sun Life Insurance Company Limited
(BSLI) is a joint venture between the Aditya Birla Group and the Sun Life
Financial Services of Canada. It started operations in March 2001 after
receiving its registration license from IRDA in January 2001. Company is
having more than 45 branches across India.
Key features:
54
• Web-enabled IT systems for superior customer services and issuing
policies on the internet.
• High degree of transparency in all business practices and procedures.
• Working on operational Business Continuity Plan.
Source: - www.irdaindia.org
55
to oct 07 to oct 06
(Rs.mill.) (Rs.mill.)
ICICI 31831.8 20808.5 53
Prudential
HDFC Standard 10675.7 6595.7 61.9
SBI Life 14717.4 8142.4 80.8
Bajaj Allianz 26498.1 15208.2 74.2
Aviva life 4586.8 3464.2 32.4
insurance
MetLife 2756.0 1162.7 137.0
insurance
Reliance life 8571.2 2803.7 205.7
insurance
Birla sun life 7595.4 3844.7 97.6
insurance
Max new York 6942.0 3720.4 86.6
life insurance
Bharti AXA life 258.7 1.1 22907.8
insurance
Tata AIG 4413.0 3264.8 35.2
ING Vysya 3047.7 2086.7 46.1
Kotak 3476.6 2172.6 60.0
Mahindra
12. Comparison of ULIP products of different
insurance companies
ICICI Prudential
Fund options- growth fund, balanced fund, income fund, and preserver.
allocation to equities- upto 100% in growth fund, upto 40% in balanced
fund, nil in income fund, 50% in preserver.
minimum premium- 20,000.
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min/max age at entry- upto 65 years.
sum assured- annual premium*term/2.
fund management charges- 1.5% in growth fund, 1.0% in balanced fund, .
75% in income and preserver fund.
fixed monthly expenses- 60rs.
partial withdrawals- above one partial withdrawal 100 rs. charge per
withdrawal.
charges on top ups- 1%.
switching charges- above 4 switches in a year 100 rs. Per switching.
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allocation to equities- 100% in growth fund, 30-60% in balanced fund, 15-
30% in defensive fund, 0% in secure and liquid fund.
minimum premium- 10,000.
min/max age at entry- 18- 65 years.
sum assured- annual premium*term/2, to 40 times the regular premium
amount.
fund management charges- .80%.
fixed monthly expenses- 20 rs.
partial withdrawals allowed- above 6 partial withdrawals 250 rs. per
withdrawal.
charges on top ups- 2.5% for initial 2 years, after 1%.
switching charges- 24 free switching and then 100 rs. per switching.
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Max New York Life Insurance
fund options- growth fund, balanced fund, conservative fund, secure fund.
allocation to equities- 20 – 70% in growth fund, 10 – 40% in balanced
fund, 0 – 15% in conservative fund, 0% in secure fund.
minimum premium- 15,000.
min/max age at entry- 12 – 60 years.
sum assured- minimum sum assured 100,000 rs.
fund management charges- .90% - 1.25% of net assets in the fund.
fixed monthly expenses- 50 rs.
charges on top ups- nil.
switching charges- above 2 switching per year 500 rs. Per switching.
59
Insurer Market view Product focus Distribution Others
strategy
60
ICICI Market Pension and Significantly Significant
Prudential growth at healthy diversified capital
60%CAGR products likely with 40% requirement
in medium to grow given from non for maintain
term, target aging agency force, share in a
to maintain population and expanding high growth
share at 30% increasing life reach to non market, both
in private expectancy. metro areas. partners
segment. Product willing to
awareness is contribute,
slightly behind
LIC despite a
significant
time
disadvantage;
health could
comprise 3 –
5% of product
mix in 5 years.
61
growth over products and higher focus next 18
next few higher on training months, it
years, steady persistency agents rather would
state not levels, group than hard sell, require
expected focus given rural focus capital even
flexibility in required but if FDI were
equity obstacles raised to
investment, include lack 49%.
competitive of bank
versus mutual infrastructure.
funds for
longer tenure
products given
lower amc
charges
Bajaj Current Most products More focus Growth and
Allianz life industry homogeneous on smaller market share
insurance growth across players, towns, oriented
sustainable not much price greater strategy,
for next 7 – differentiation, emphasis on detarrifing
10 years, ULIPsales agency force would hit
target 10% unlikely to be expansion. non life
market share affected by segment
in next 5 recent adversely.
years regulations,
not much
threat from
62
mutual funds.
Birla sun life Target to be Currently only Agent It believes
insurance top in 5 unit linked productivity some
years products sold is an issue marginal
but group given their players could
linked part time br bought
products are nature, target out.
focus area for is 130
development. branches all
over India,
also will
leverage on
group’s
products
distribution
strengths.
13. Questioner
IBS Kochi
Chakrampilly Towers Puthiya Road, NH-47 Bye Pass
63
Palarivattom, PO
Kochi 682025
Ph. 0484-2338823
Name-
Company-
Designation-
Contact no.-
The following questionnaire is for the purpose of our research project as a part of
our MBA curriculum on ‘Marketing Strategy of different Insurance companies’. It
is assured from us that any information given by the company will not be disclosed
by any means. With this assurance I expect accurate data from company to help me
for my project.
________________________________________________________________
64
(c)By awarding non-cash prizes
(d)By giving training session
13. What is average total premium collection in your branch (in a month)
(a) <2 Cr. (b) 2-4 Cr. (c) 4-5 Cr. (d) >5 Cr.
65
14. Other useful activities which you do in agency (if any, please mention)
……………………………………………………………………...
………………………………………………………………………………...
………………………………………………………………………………...
14. Findings
66
Primary data has been collected by the survey of branch and agency
manager of different insurance companies in Calicut. sample size for this
research is 27.
Recruitment_Personalreference
Recruitment_Advertisement
Recruitment_Interviews
Recruitment_Placementagencies
67
Response Frequency Percent
no 27 100.0
68
2. By offering higher channel position.
3. By awarding them non cash prizes.
4. By giving them training session.
Active_Incentives
Active_Higherchannelposition
Active_Noncashprizes
Active_Trainingsession
69
Total 27 100.0
So most of the companies are giving training session and awarding non cash
prizes to make their advisors active, some of the companies are increasing
incentives and offering higher channel position to make their advisors
active.
Products_Terminsurance
70
yes 5 18.5
no 22 81.5
Total 27 100.0
Products_Unitlinked
Products_Moneyback
Products_Endowment
So all the companies are promoting their unit linked products and some
companies are promoting rest of the products including unit linked products.
71
T
Endowment products
Productdeployment_Profitoriented
Respons
e Frequency Percent
yes 6 22.2
no Unit linked
21 products 77.8
Total 27 100.0
Productdeployment_Customersneed
72
Respons
e Frequency Percent
yes 20 74.1
no 7 25.9
Total 27 100.0
Productdeployment_Marketfeedback
Respons
e Frequency Percent
yes 2 7.4
no 25 92.6
Total 27 100.0
Productdeployment_Additionalbenefits
Respons
e Frequency Percent
yes 5 18.5
no 22 81.5
Total 27 100.0
73
B
Respons
e Frequency Percent
yes 4 14.8
no 23 85.2
Total 27 100.0
On customer need
74
differentiation_pricing
Respons
e Frequency Percent
yes 13 48.1
no 14 51.9
Total 27 100.0
differentiation_deploymentoffunds
Respons
e Frequency Percent
yes 7 25.9
no 20 74.1
Total 27 100.0
differentiation_service
Respons
e Frequency Percent
yes 17 63.0
no 10 37.0
Total 27 100.0
So most of the companies are giving better service quality and better pricing
to differentiate their products from their competitors.
75
By better service quality
Modeofinteraction_Direct
By pricing of product
76
Modeofinteraction_Telephone
Modeofinteraction_Advertisement
Modeofinteraction_Onlinecontacts
So almost all the companies are interacting with customers through direct
marketing and by telephonic contacts (creating database).
77
Mod
Strategies_Service
By telephonic contacts
78
Strategies_Pricing
Strategies_Interaction
Strategies_Extrabenefits
79
By providing extra benefits
Premium collection:-
By increasing periodicity
Premium Collection of
interaction
Premium Frequency Percent
less than 2 cr. 20 74.1
2 to 4 cr. 5 18.5
4 to 5 cr. 1 3.7
more than 5 cr. 1 3.7
total 27 100.0
80
More than 5 cr.
81
Recruitment of advisors through personal reference and
making them active:-
Recrui
82
Recruitment of advisors through advertisement and making
them active:-
Recr
83
Recruitment of advisors through walk in interviews and
making them active:-
Recrui
84
Conclusion
85
15. Recommendations
• SBI Life should also promote the term and endowment insurance
products including ULIP products. Because these are basic insurance
products. Promote products as life insurance products not an as
investment products.
• Somewhat the brand name of SBI is harming the SBI Life insurance,
because most of the people are not happy with the service provide by
SBI bank, so it is necessary to change the mentality of the people that
SBI Life insurance is different from SBI bank. SBI Life should
promote their product features rather than promoting their brand
name.
• SBI Life should sell their products through head of the villages or
through panchayat in villages. People in villages believe on the head
and panchayat so selling insurance will be easier in villages.
• SBI Life can introduce some special policies for the farmers to tap the
rural market, and pricing for these kinds of products should be less so
farmers can easily afford to take policies.
86
16. References
87