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OF DEGREE OF MASTER IN BUSINESS ADMINISTRATION 2009-11 UNDER THE GUIDANCE OF: MS. SONIKA BHOJ FACULTY, DCAS SUBMITTED BY: ANUJ SOKAL ROLL NO.0651221808_ BATCH NO. (BBA SEMESTER V) DELHI COLLEGE OF ADVANCE STUDIES (Approved by AICTE, HRD Ministry, Govt. of India) Affiliated to Guru Gobind Singh Indraprastha University, Delhi
STUDENT DECLARATION This is to certify that I have completed the Project titled “RELIANCE LIFE INSURANCE PRODUCTS” under the guidance of “Mr. Anuj Sokal” in the partial fulfillment of the requirement for the award of the degree of “Masters in Busines s Administration” from “Delhi College of Advanced Studies, New Delhi.” This is an original work and I have not submitted it earlier elsewhere. ………………………. (ANUJ SOKAL) Enrollment No. - 0651221808 ( BBA, 5th Sem )
CERTIFICATE FROM COMPANY
CERTIFICATE FROM GUIDE This is to certify that the project titled “RELIANCE LIFE INSURANCE PRODUCTS” is an academic work done by “TARUN KRISHNA” submitted in the partial fulfillment of the requirement for the award of the degree of “Masters in Business Administration” from “Rukmini Devi Institute of Advanced Studies, New Delhi” under my guidance and direction. To the best of my knowledge and belief the data and information presented by him in the Project has not been submitted earlier elsewhere. Ms. Sonika Bhoj (Project Guide) RDIAS
ACKNOWLEDGEMENT "Gratitude is not a thing of expression; it is more matter of feeling." There is always a sense of gratitude which one express towards others for their help and supervision in achieving the goals. This formal piece of acknowledgement is an attempt to expre ss the feeling of gratitude towards people who helpful me in successfully completing of my trainin g. I would like to express my deep gratitude to Mr. Nimit Verma my training coordi nator for their constant co-operation. He was always there with his competent guidance and valuable sugge stion throughout the pursuance of this research project. Special thanks to Ms. Sonika Bhoj who guided me to work honestly and to give valuable suggestion for improving my work Last but not least I would also like to place of appreciation to all the respondents whose responses were of utmost importance fo r the project. Above all no words can express my feelings to my parents, friends all those pers ons who supported me during my project. I am also thankful to all the respondent s whose cooperation & support has helped me a lot in collecting necessary inform ation. I offer my sincere thanks and humble regards to Rukmini Devi Institute Of Advanced Studies, GGSIP University, New Delhi for imparting us very valuable pr ofessional training in MBA. I would also like to thank almighty God for his blessings showered on me during the completion of project report.
EXECUTIVE SUMMARY In today’s corporate and competitive world, I find that insurance sector has the m aximum growth and potential as compared to the other sectors. Insurance has the maximum growth rate of 72-86% while as FMCG sector has maximum 14-17% of growth rate. This growth potential attracts me to enter in this sector and RELIANCE LIF E INSURANCE has given me the opportunity to work and get experience in highly co
mpetitive and enhancing sector. The success story of good market share of different market organizations depends upon the availability of the product and services near to the customer, which c an be distributed through a distribution channel. In Insurance sector, distribut ion channel includes only agents or agency holders of the company. If companies like RELIANCE LIFE INSURANCE, TATA AIG, and MAX etc have adequate agents in the market they can capture big market as compared to the other companies. Agents are the only way for a company of Insurance sector through which policies and benefits Of the company can be explained to the customer.
Student declaration………………………………………………………………………1 Certificate from Company/Organization………………………………………….............2 Certificate from Guide…......................................................... ...........................................3 Acknowledgement............................................................... ...............................................4 Executive Summary………………………………………………………………............5 Chapter Scheme………………………………………………………………………………..6 List of Tables………………………………………………………………………………….10 List of Graphs…………………………………………………………………………………10 List of Charts………………………………………………………………………………….11 List if Abbreviations, if any…………………………………………………………………..11 CHAPTER 1- INTRODUCTION 1.1 Purpose of the study…………………………………………………..…………..12 1.2 Research Objectives of the study…………………………………………………13 1.3 Research Methodology of the study………………………………………………14 1. 3.1 Research Design……………………………… ……………………………14 1.3.2 Data Collection- Primary & Secondary data………………………………..15 1.3.3 Sample design…………………………………………………………...15 18.104.22.168 Population……………………………………………………………15 22.214.171.124 Sample size…………………………………………………………..15 126.96.36.199 Sampling method……………………………………………………………16 1.3.4 Method of data collection…………………………………………………………16 188.8.131.52 Instrument for data collection…………………………………………………………16 184.108.40.206 Drafting of a questionnaire………………………………………..17-23 1.3.5 Limitations………………………………………………………………..24 CHAPTER-2 Review of literature ………………………………………………………………….............25-34
CHAPTER-3 About Organization/ Company Profile………………………………………………………………………………....35-43 CHAPTER -4 About Reliance life Insurance Products ………………………………………………………………………………………………..44-60 CHAPTER -5 Analysis………………………………………………………………………………………61-80 CHAPTER-6 Findings (If any)……………………………………………………………………………...81 CHAPTER-7 Suggestion...................................................................... ..........................................................82. CHAPTER-8 Conclusion………………………………………………………………………………83 Bibliography…………………………………………………………………….84
LIST OF TABLES Page Number 47-48 Page Number 55-56
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LIST OF CHARTS Page Number 14 Page Number 42
LIST OF ABBREVIATIONS (IF ANY) Not any
CHAPTER 1. INTRODUCTION With the largest number of life insurance policies in force in the world, Insura nce happens to be a mega opportunity in India. It’s a business growing at the rate of 15-20 per cent annually and presently is of the order of Rs 1560.41 billion (for the financial year 2006 – 2007). Together with banking services, it adds abou t 7% to the country’s Gross Domestic Product (GDP). The gross premium collection i s nearly 2% of GDP and funds available with LIC for investments are 8% of the GD P. Even so nearly 65% of the Indian population is without life insurance cover whil e health insurance and non-life insurance continues to be below international st andards. A large part of our population is also subject to weak social security and pension systems with hardly any old age income security A well-developed and evolved insurance sector is needed for economic development as it provides long term funds for infrastructure development and strengthens t he risk taking ability of individuals. It is estimated that over the next ten ye ars India would require investments of the order of one trillion US dollars. 1.1 Purpose of the study 1. The objective which leads me to do this report was my strong desire to k now about the Life Insurance, and its status in India. 2. Second, I wanted to explore that how Reliance Life insurance services he lp in changing the Face of Insurance industry in India. The question which came in to my mind at that time was from where will I learn a ll this and the
answer which I got for this question was in the form of my project title. Since this is been a good opportunity for me so, I decided to take up this project. 1.2 Research objectives of the study The objectives of undertaking the project are: PRIMARY OBJECTIVE- To study and analyze Life insurance, role of Reliance life in surance, its present scenario and its emerging challenges. SECONDARY OBJECTIVE- To analyze the impact of Reliance life insurance products, its scope and opportunities in near future. Other Objectives include: Proper understanding and analysis of life insurance industry. To know about brand awareness of Reliance Life Insurance and customer’s preference about Reliance Life Insurance. According the market survey come know about how much potential of insurance mar ket in our city. And base on analysis of the result thus obtained make a report on that research. Training aims at recruiting maximum number of Life Advisors and to Sell the maxi mum policies for the company and bring the business for the company which ever i s going at the particular point of time. As the Reliance Life Insurance well reputed company in India it’s great chance for me to observed different products launch by other competitor companies like ICI CI prudential, Bajaj alliance ,LIC, Max New York life etc. In all, it is to unde rstand the overall working of the Life insurance sector. The objective behind the project is as follows: To find the right candidate. To about their family background, occupation, social relation, Qualification, Ag e
Research methodology of the study
Flowchart of research methodology 1.3.1 Research Design • NON-PROBABILITY • EXPLORATORY & DISCRIPTIVE EXPERIMENTAL RESEARCH The research is primarily both exploratory as well as descriptive in nature. The sources of information are both primary & secondary. A well-structured question naire was prepared and personal interviews were conducted to collect the custome r’s perception and buying behavior, through this questionnaire.
1.3.2 Data collection Primary & Secondary data Study of Secondary sources of information. The reason for selecting this mode of research for this type is that it’s a probab ly quickest and most economical way for research to find possible hypothesis and to take advantage of the work of to others and utilize their own earlier effort s. Most large companies that have maintained marketing research programs over a number of years have accumulated significant libraries of research organizations furnishing continuing data. Procedure:As it is a secondary research, all the data is selected after rigorous analysis of articles from newspapers, magazines and internet. All the research collected is done by professional analyst across the world and is compiled in this project
to understand the financial and business impact of merger and acquisition more effectively. Limitations of Study:Limitation to gather all the relevant information. Limitation of time. Conclusion may change according to the time 1.3.3 Sample Design 3.3.1 Population The respondents who were asked to fill out questionnaires are the sampling units . These Comprise of employees of MNCs, Govt. Employees and Self Employees etc. 220.127.116.11 Sample Size The sample size was restricted to only 100, which comprised of mainly peoples fr om different regions of Delhi due to time constraints. 18.104.22.168 Sampling Method Initially, a rough draft was prepared keeping in mind the objective of the resea rch. A pilot study was done in order to know the accuracy of the Questionnaire. The final Questionnaire was arrived only after certain important changes were do ne. Thus my sampling came out to be judemental and convinent. 1.3.4 Method of data collection Primary Secondary 22.214.171.124 Instrument for data collection • • • Research Tool Bar diagrams, Tables, Moving average method for forecasting
126.96.36.199 DRAFTING OF QUESTIONNNAIRE 1. ARE YOU EMPLOYED? YES NO ( Note:-If YES, proceed then only) 2. DO YOU HAVE ANY INSURANCE POLICY? YES No 3. WHICH INSURANCE POLICY DO YOU HAVE? LIFE NON-LIFE 4. WHICH CO’S INSURANCE POLICY YOU PREFER THE MOST? (RANK THEM) a) LIC b) ICICIPRUDENTIAL c) SBI LIFE INSURANCE d) ING VYSYA LIFE e) RELIANCE LIFE INSURANCE f) TATA AIG LIFE
g) ANY OTHER 5. a) <5Yrs
FOR HOW MANY YEARS DO YOU HAVE INSURANCE POLICY? (Please Tick) b) 5-10 Yrs c) 10-15 Yrs d) Any Other______ (Specify)
6. WHAT DO YOU THINK ARE THE BENEFITS OF INSURANCE COVER? (RANK THE M) a) COVER FUTURE UNCERTAINITY Y b) TAX DEDUCTIONS c) FUTURE INVESTMENT d) ANY OTHER ___________ (Specify)
7. WHICH FEATURE OF YOUR POLICY ATTRACTED YOU TO BUY IT? (RANK THEM) a) LOW PREMIUM b) LARGER RISK COVERANCE c) MONEY BACK GUARNTEE d) REPUTATION OF COMPANY e) EASY ACCESS TO AGENTS f) ANY OTHER 8. a)<4k _________ (Specify)
YOUR MONTHLY INCOME? b)4k-8k c)8k-12k d)12k-16k e)Other_____(Specify)
9. DO YOU REALLY THINK INSURANCE POLICY COVER IN TODAY’S SCENARIO IS NOT ESSE NTIAL? ____________________________________________________ 10. WHAT’S YOUR PERCEPTION ABOUT INSURANCE? (RANK THEM) a) A SAVING TOOL b) A TAX SAVING DEVICE c) A TOOL TO PROTECT FUTURE 11. HOW HAS/WOULD YOU BOUGHT/BUY INSURANCE? a) CUSTOMER APPROCHED INSURANCE COs b) INSURANCE CO.s APPROCHED CUSTOMER 12. ARE YOU SATISFIED WITH THE POLICY? a) SATISFIED SAVING TOOL b) NOT SATISFIED c) NOT RESPONDING 13. ARE YOU SATISFIED WITH THE SERVICE AGENT? a) SATISFIED SAVING TOOL b) NOT SATISFIED
c) NOT RESPONDING 14. DO YOU PAY TAXES? YES NO
15. WHERE HAVE YOU INVESTED FOR TAX SAVING? (RANK THEM) a) LIC b) NSC c) BONDS d) PPF e) PF f) EPF 16. WHICH IS THE BEST FORM OF INVESTMENTS? (RANK THEM) a) FIXED ASSETS b) BANK DEPOSITS c) JEWELLERY d) SECURITIES, i.e. Bonds, MFs e) SHARES f) INSURANCE 17. WHAT DO YOU INTENT TO GAIN FROM INVESTMENTS? a) SAVING & RETURNS b) SECURITY c) TAX BENEFITS 18. WHAT’S THE RIGHT AGE TO BUY INSURANCE? a) AFTER 25 Yrs b) AFTER 35 Yrs c) AFTER 45 Yrs d) ANYTIME 19. HOW WOULD YOU RATE INDIAN INSURANCE COs? a) RIGID PLANS b) NON-USER FRIENDLY c) UNSATISFATORY SREVICES d) NON-AGGRESSIVE e) SATISFACTORY
f) GOOD g) VERY GOOD 20. ARE YOU PLANNING FOR NEW INVESTMENTS? PLANNING NOT PLANING
21. WOULD YOU GO FOR INSURANCE IF A SERVICE PROVIDER AWAY FROM THE CITY OFFERS B ETTER SERVICE & PRODUCTS? a) YES b) NO c) UNCERTAIN THANK YOU NAME: __________________________________________________________ ADDRESS: _______________________________________________________ _______________________________________________________ OCCUPATION: __________________________________________________
1.3.5 Limitations 1. The research is confined to a certain parts of Delhi and does not necessarily shows a pattern applicable to all of Country. 2. Some respondents were reluctant to divulge personal information which can aff ect the validity of all responses. 3. In a rapidly changing industry, analysis on one day or in one segment can cha nge very quickly. The environmental changes are vital to be considered in order to assimilate the findings.
CHAPTER2. REVIEW OF LITERATURE
THE HISTORY OF INDIAN INSURANCE INDUSTRY ORIGIN OF LIFE INSURANCE Almost 4,500 years ago, in the ancient land of Babylonia, traders used to bear r isk of the caravan trade by giving loans that had to be later repaid with intere st when the goods arrived safely. In 2100 BC, the Code of Hammurabi granted lega l status to the practice. That, perhaps, was how insurance made its beginning. Life insurance had its origins in ancient Rome, where citizens formed burial clu bs that would meet the funeral expenses of its members as well as help survivors by making some payments. As European civilization progressed, its social institutions and welfare practic es also got more and more refined. With the discovery of new lands, sea routes a nd the consequent growth in trade, medieval guilds took it upon themselves to pr otect their member traders from loss on account of fire, shipwrecks and the like . Since most of the trade took place by sea, there was also the fear of pirates. S o these guilds even offered ransom for members held captive by pirates. Burial e xpenses and support in times of sickness and poverty were other services offered . Essentially, all these revolved around the concept of insurance or risk covera ge. That s how old these concepts are, really. “In 1347, in Genoa, European maritime nations entered into the earliest known insu rance contract and decided to accept marine insurance as a practice.” The First Step Insurance as we know it today owes its existence to 17th century England. In fac t, it began taking shape in 1688 at a rather interesting place called Lloyd s Co ffee House in London, where merchants, ship-owners and underwriters met to discu ss and transact business. By the end of the 18th century, Lloyd s had brewed eno ugh business to become one of the first modern insurance companies. Insurance and Myth... Back to the 17th century. In 1693, astronomer Edmond Halley constructed the firs t mortality table to provide a link between the life insurance premium and the a verage life spans based on statistical laws of mortality and compound interest. In 1756, Joseph Dodson reworked the table, linking premium rate to age. Enter companies... The first stock companies to get into the business of insurance were chartered i n England in 1720. The year 1735 saw the birth of the first insurance company in the American colonies in Charleston, SC. In 1759, the Presbyterian Synod of Phi ladelphia sponsored the first life insurance corporation in America for the bene fit of ministers and their dependents. However, it was after 1840 that life insu rance really took off in a big way. The trigger: reducing opposition from religi ous groups. The growing years... The 19th century saw huge developments in the field of insurance, with newer pro ducts being devised to meet the growing needs of urbanization and industrializat ion. In 1835, the infamous New York fire drew people s attention to the need to provi de for sudden and large losses. Two years later, Massachusetts became the first state to require companies by law to maintain such reserves. The great Chicago f ire of 1871 further emphasized how fires can cause huge losses in densely popula
ted modern cities. The practice of reinsurance, wherein the risks are spread amo ng several companies, was devised specifically for such situations. There were more offshoots of the process of industrialization. In 1897, the Brit ish government passed the Workmen s Compensation Act, which made it mandatory fo r a company to insure its employees against industrial accidents. With the advent of the automobile, public liability insurance, which first made its appearance in the 1880s, gained importance and acceptance? In the 19th centu ry, many societies were founded to insure the life and health of their members, while fraternal orders provided low-cost, members-only insurance. Even today, such fraternal orders continue to provide insurance coverage to memb ers as do most labor organizations. Many employers sponsor group insurance polic ies for their employees, providing not just life insurance, but sickness and acc ident benefits and old-age pensions. Employees contribute a certain percentage o f the premium for these policies. Markets In tune with the global stock markets that began to recover from the second half of 2003; Indian stock markets too witnessed rapid growth. India’s two leading ind ices, the most popular BSE Sensex, and the one most used by the markets the Nati onal Stock Exchanges’ S&P CNX Nifty rose to record levels. Both primary and second ary market activity experienced sharp surge. Much progress was made in further s trengthening and streamlining risk management, market regulation and supervision . A few aspects of the major developments in the India’s stock markets are describ ed below. And the insurance sector is also play an important role in the growth of the financial market. Market Structure Indian securities market is fairly large as compared to several other emerging m arkets. There are 22 stock exchanges in the country, though the entire liquidity is shared between the countries’ two national level exchanges namely, the Nationa l Stock Exchange of India and the Bombay Stock Exchange Ltd. The regional stock exchanges are in pursuit of business models that make them viable and vibrant. M eanwhile, these exchanges have become members of the national level exchanges th rough formationof subsidiaries whose business is showing continuous growth and p rogress. The number of brokers in various stock exchanges rose from 6,711 in 199 4-95 to 9,335 in FY06. The number of brokers in all the exchanges together peake d to 10,213 in the year FY01 but gradually declined thereafter when the regional stock exchanges began to lose business in the light of wide ranging market stru cture reforms introduced since then. In FY01, when the markets were in upswing, several regional stock exchanges were generating business owing to the availabil ity of deferral products, such Badla and different settlement calendars prevaili ng at that time in these exchanges. For instance in FY01, the Delhi Stock Exchan ge registered cash market turnover of Rs 838.71 bn; Uttar Pradesh Stock Exchange , Rs 247.47 bn, Ludhiana Stock Exchange Rs 97.32 bn, Pune Stock Exchange Rs 61.7 1 bn as against Rs 13,395.11 bn of the turnover at the National Stock Exchange a nd Rs 10,000.32 bn turnover at the Bombay Stock Exchange. With the abolition of the deferral products and introduction of uniform T+2 settlement cycle, the liqu idity in these exchanges flowed to the national level system consisting of NSE a nd BSE. HISTORICAL PERSPECTIVE The history of life insurance in India dates back to 1818 when it was conceived as a means to provide for English Widows. Interestingly in those days a higher p remium was charged for Indian lives than the non - Indian lives, as Indian lives were considered more risky to cover. The Bombay Mutual Life Insurance Society s tarted its business in 1870. It was the first company to charge the same premium for both Indian and non-Indian lives. The Oriental Assurance Company was established in 1880. The General insurance bu siness in India, on the other hand, can trace its roots to Triton Insurance Comp
any Limited, the first general insurance company established in the year 1850 in Calcutta by the British. Till the end of the nineteenth century insurance busin ess was almost entirely in the hands of overseas companies. Insurance regulation formally began in India with the passing of the Life Insura nce Companies Act of 1912 and the Provident Fund Act of 1912. Several frauds dur ing the 1920 s and 1930 s sullied insurance business in India. By 1938 there wer e 176 insurance companies. The first comprehensive legislation was introduced with the Insurance Act of 193 8 that provided strict State Control over the insurance business. The insurance business grew at a faster pace after independence. Indian companies strengthened their hold on this business but despite the growth that was witnessed, insuranc e remained an urban phenomenon. The Government of India in 1956, brought together over 240 private life insurers and provident societies under one nationalized monopoly corporation and Life In surance Corporation (LIC) was born. Nationalization was justified on the grounds that it would create the much needed funds for rapid industrialization. This wa s in conformity with the Government s chosen path of State led planning and deve lopment. The non-life insurance business continued to thrive with the private sector till 1972. Their operations were restricted to organized trade and industry in large cities. The general insurance industry was nationalized in 1972. With this, nea rly 107 insurers were amalgamated and grouped into four companies- National Insu rance Company, New India Assurance Company, Oriental Insurance Company and Unite d India Insurance Company. These were subsidiaries of the General Insurance Comp any (GIC). KEY MILESTONES 1912: The Indian Life Assurance Companies Act enacted as the first statute to re gulate the life insurance business. 1928: The Indian Insurance Companies Act enacted to enable the government to col lect statistical information about both life and non-life insurance businesses. 1938: Earlier legislation consolidated and amended by the Insurance Act with the objective of protecting the interests of the insuring public. 1956: 245 Indian and foreign insurers along with provident societies were taken over by the central government and nationalized. LIC was formed by an Act of Par liament- LIC Act 1956- with a capital contribution of Rs. 5 crore from the Gover nment of India. Life insurance Life assurance is a contract between the policy owner and the insurer, where the insurer agrees to pay a sum of money upon the occurrence of the insured individual s or individual s death or other event, such as terminal illness or critical illness. In return, the policy owner (or policy payer) agrees to pay a stipulated amount called a premium at regular intervals or in lu mp sums. There may be designs in some countries where bills and death expenses plus catering fo r after funeral expenses should be included in Policy Premium. In the United States, the predomi nant form imply specifies a lump sum to be paid on the insured s demise.
As with most insurance policies, life insurance is a contract between the insurer and The policy owner (policyholder) whereby a benefit is paid to the designated Bene ficiary (or Beneficiaries) if an insured event occurs which is covered by the policy. To be a life policy the Insured event must be based upon life (or lives) of the people named in the poli cy. Life policies are legal contracts and the terms of the cont ract describe the Limitations of the insured events. Specific exclusions are often written into th e contract to limit the liability of the insurer; for example claims relating to suicide, fraud, war , riot and civil Commotion. Life based contracts tend to fall into two major categories: • ent, Protection policies - designed to provide a benefit in the event of specified ev
typically a lump sum payment. A common form of this design is term insurance. • Investment policies - where the main objective is to facilitate the growth of ca pital by • ersal regular or single premiums. Common forms (in the US anyway) are whole life, univ
life and variable life policies. THE INSURANCE INDUSTRY IN INDIA: AN OVERVIEW With the largest number of life insurance policies in force in the world, Insura nce happens to be a mega opportunity in India. It’s a business growing at the rate of 15-20 per cent annually and presently is of the order of Rs 1560.41 billion (for the financial year 2006 – 2007). Together with banking services, it adds abou t 7% to the country’s Gross Domestic Product (GDP). The gross premium collection i s nearly 2% of GDP and funds available with LIC for investments are 8% of the GD P. Even so nearly 65% of the Indian population is without life insurance cover whil e health insurance and non-life insurance continues to be below international st andards. A large part of our population is also subject to weak social security and pension systems with hardly any old age income security A well-developed and evolved insurance sector is needed for economic development as it provides long term funds for infrastructure development and strengthens t he risk taking ability of individuals. It is estimated that over the next ten ye ars India would require investments of the order of one trillion US dollars. INDUSTRY REFORMS
Reforms in the Insurance sector were initiated with the passage of the IRDA Bill in Parliament in December 1999. The IRDA since its incorporation as a statutory body in April 2000 has fastidiously stuck to its schedule of framing regulation s and registering the private sector insurance companies. Since being set up as an independent statutory body the IRDA has put in a framework of globally compat ible regulations. The other decision taken simultaneously to provide the supporting systems to the insurance sector and in particular the life insurance companies was the launch of the IRDA online service for issue and renewal of licenses to agents. The appr oval of institutions for imparting training to agents has also ensured that the insurance companies would have a trained workforce of insurance agents in place to sell their products. PRESENT SCENARIO The life insurance industry in India grew by an impressive 47.38%, with premium income at Rs. 1560.41 billion during the fiscal year 2006-2007. Though the total volume of LIC s business increased in the last fiscal year (2006-2007) compared to the previous one, its market share came down from 85.75% to 81.91%. The 17 private insurers increased their market share from about 15% to about 19% in a year s time. The figures for the first two months of the fiscal year 200708 also speak of the growing share of the private insurers. The share of LIC for this period has further come down to 75 percent, while the private players have grabbed over 24 percent. With the opening up of the insurance industry in India many foreign players have entered the market. The restriction on these companies is that they are not all owed to have more than a 26% stake in a company’s ownership. Since the opening up of the insurance sector in 1999, foreign investments of Rs. 8.7 billion have poured into the Indian market and 19 private life insurance co mpanies have been granted licenses. Innovative products, smart marketing, and aggressive distribution have enabled f ledgling private insurance companies to sign up Indian customers faster than any one expected. Indians, who had always seen life insurance as a tax saving device , are now suddenly turning to the private sector and snapping up the new innovat ive products on offer. Some of these products include investment plans with insu rance and good returns (unit linked plans), multi – purpose insurance plans, pensi on plans, child plans and money back plans. (www.wikipedia.com) Major Player in the Insurance Sector There are many reputed companies in the market which provide the Insurance for l iving being and non living beings. The companies in life Insurance are as follows:Life Insurer in Public Sector • Life Insurance Corporation of India Life Insurer in Private Sector • Reliance life Insurance Company Limited • ICICI Prudential Life Insurance • Bajaj Allianz Life Insurance • Tata AIG Life Insurance corporation Limited • HDFC Standard Life Insurance • Birla Sun Life Insurance • SBI Life Insurance • Kotak Mahindra old Mutual Life Insurance • Aviva Life Insurance
• • • • • • •
MetLife India Life Insurance ING Vysya Life Insurance Max New York Life Insurance Shriram Life Insurance Bharti AXA Life Insurance Co. Limited IDBI Forties Life Insurance Co. Limited Argon Religare Life Insurance Co. Limited
Major Broking house During the analysis of the market it has been found that there are a lot of the brokeing house in the market which are providing the online trading facility to the individuals or the group of the individuals. • 5paisa.com You can now buy and sell shares on 5paisa.com with speeds comparable and at time s better than NSE s NEAT Terminal. This speed and reliability comes only with pe rseverance of pioneer backed by huge investment in technology! You can now buy a nd sell shares on 5paisa.com with speeds comparable and at times better than NSE s NEAT Terminal. This speed and reliability comes only with perseverance of pio neer backed by huge investment in technology. • Advani Share Brokers Advani Share Broker, a reputed Bombay based on investment house, operates from I ndia s financial hub, Dalal Street, since sixty years. It deals in equities, deb t and derivatives on the Bombay Stock Exchange and the National Stock Exchange o f India. • AGROY Group of Companies Agroy group of companies is a well established name in the field of capital mark ets and financial services. AGROY Finance & Investment Ltd. (AFIL) is the group s flagship company engaged in capital markets as a premier financial and stock b roking house. The company was formed in July 1992. Since then it has enjoyed pat ronage of a large number of valued customers and business partners. • Anand Rathi Securities Limited Anand Rathi Securities Limited provides financial and advisory services includin g wealth management, investment banking, corporate advisory, brokerage & distrib ution of equities, commodities, mutual funds and insurance - all of which are su pported by powerful research teams. • India bulls India bulls are India s leading retail financial services company with 70 locati ons spread across 62 cities. While our size and strong balance sheet allow us to provide you with varied products and services at very attractive prices, our ov er 450 Client Relationship Managers are dedicated to serving your unique needs. • Religare Securities Ltd. Religare Enterprises Limited (A Ranbaxy Promoter Group Company) through Religare Securities Limited, Religare Finvest Limited, Religare Commodities Limited and Religare Insurance Advisory Services Limited provides integrated financial solut ions to its corporate, retail and wealth management clients. Provides various fi nancial services which include Investment Banking, Corporate Finance, Portfolio Management Services, Equity & Commodity Broking, Insurance and Mutual Funds. • Jaypee Capital Services Ltd. Jaypee Capital Services Ltd. is a registered self-clearing member with National Stock Exchange and SEBI. It has the expertise and the experience to capitalize o n daily stock movements and employ over 20 specialist traders certified by the N
SE. • ICICI Direct Online share and mutual funds trading facility by the ICICI group. • Arcade Share & Stock Brokers Arcadia group began its modest journey in 1995 and now Arcadia proudly boasts ab out membership to NSE,BSE, Depository Participant (CDSL),MCX,NCDEX .The philosop hy of client servicing backed by all principal Indian Stock and Commodity exchan ge gives Arcadia edge over other players in the industry segment to offer value based services to its customers. • Indianstockmarket.net Indianstockmarket.net is an effort to educate Indian investor by providing usefu l stock news, stock market websites, informative articles, resources to various investment guides. Major Developments in equity brokerage industry in India • • • • • • • • • • • • Corporate memberships Wider product offerings Greater reliance on research Accessing equity capital markets Foreign collaborations and joint ventures Specialized services/niche broking Online broking Emerging challenges and outlook for the brokerage industry Fragmentation Global Opportunities Competition from foreign firms Investor Protection
CHAPTER 3. ABOUT ORGANISATION/COMPANY PROFILE Founder Few men in history have made as dramatic a contribution to their country’s economi c fortunes as did the founder of Reliance, Shri. Dhirubhai H Ambani. Fewer still have left behind a legacy that is more enduring and timeless.
As with all great pioneers, there is more than one unique way of describing the true genius of Dhirubhai: The corporate visionary, the unmatched strategist, the proud patriot, the leader of men, the architect of India’s capital markets, the c hampion of shareholder interest. But the role Dhirubhai cherished most was perhaps that of India’s greatest wealth creator. In one lifetime, he built, starting from the proverbial scratch, India’s largest private sector enterprise. When Dhirubhai embarked on his first business venture, he had a seed capital of barely US$ 300 (around Rs 14,000). Over the next three and a half decades, he co nverted this fledgling enterprise into a Rs 60,000 crore colossus—an achievement w hich earned Reliance a place on the global Fortune 500 list, the first ever Indi an private company to do so. Dhirubhai is widely regarded as the father of India’s capital markets. In 1977, wh en Reliance Textile Industries Limited first went public, the Indian stock marke t was a place patronised by a small club of elite investors which dabbled in a h andful of stocks. Undaunted, Dhirubhai managed to convince a large number of first-time retail inv estors to participate in the unfolding Reliance story and put their hard-earned money in the Reliance Textile IPO, promising them, in exchange for their trust, substantial return on their investments. It was to be the start of one of great stories of mutual respect and reciprocal gain in the Indian markets. Under Dhirubhai’s extraordinary vision and leadership, Reliance scripted one of th e greatest growth stories in corporate history anywhere in the world, and went o n to become India’s largest private sector enterprise. Though the company s oil-related operations form the core of its business, it ha s diversified its operations in recent years. After severe differences between t he founder s two sons, Mukesh and Anil Ambani, the group was divided between the m in 2006. Reliance Capital (RCAP), a non banking financial company, is the financial servi ce arm of the Anil Dhirubhai Ambani Group (ADAG) which has varied interests in a reas like telecom, energy, entertainment. Reliance Capital is one of India s lea ding and fastest growing private sector financial services companies and ranks a mong the top 3 private sector financial services and banking companies, in terms of net worth. Through the company’s subsidiaries, it offers products and services like mutual fund, life insurance and general insurance. It has sizable private equity and proprietary investments and is pursuing new ventures like stock broki ng, consumer financing and the asset recovery business as well. Reliance Capital , initially focused on the asset management business, has recently expanded its presence in life insurance, general insurance space and ebroking business as wel l. Reliance Capital launched Reliance Money, a retail broking and distributor of a range of financial service products. It has a network of over 2,200 outlets ( India’s largest retail network by a non banking financial services company). Relia nce Capital has 100% economic interest in all the business
“We will create the next generation communication network and information technolo gy infrastructure that will bring immense value to every Indian, and leapfrog In dia into the center stage of global Infocomm space “
“We were small then - an infant in industry We are small now - at the doorsteps of opportunity.” - Dhirubhai Ambani
Elected in India “Businessman of the Millennium” • Founded by Shri. Dhirubhai Ambani in the year 1966. • Reliance Group was started with a capital of Rs. 15000/-. • He converted this fledgling enterprise into a Rs. 95,000 crore colossus. • Over time, Reliance Group has diversified into a core specialization in petroche micals with additional interests in telecommunications, information technology, energy, power, retail, textiles, infrastructure services, capital markets, & log istics. He is credited with having pioneered a number of path-breaking financial innovat ions in the Indian capital markets. He spearheaded the country s first forays in to the overseas capital markets with international public offerings of global de positary receipts, convertibles and bonds. Starting in 1991, he directed Relianc e Industries in its efforts to raise over US$ 2 billion. He also steered the 100-year Yankee bond issue for the company in January 1997.
Our Chairman • Shri. Anil D. Ambani was 4, 1959 at Mumbai • He did his schooling and of Business Administration from • Anil Dhirubhai Ambani is born to Dhirubhai Ambani and Kokilaben Ambani on June 0 graduation in Mumbai and thereafter pursued his Masters Wharton Business School, USA the Chairman of all listed Group companies, namely: Rel
iance Communications, Reliance Capital, Reliance Energy, Reliance Health, Relian ce Entertainment and Reliance Natural Resources Limited. • Anil D Ambani joined Reliance in 1983 as Co-Chief Executive Officer • Under his leadership, Reliance pioneered India s first forays into overseas capi tal markets with international public offerings of global depository receipts, c onvertibles and bond • Wharton Board of Overseers, The Wharton School, USA • Central Advisory Committee, Central Electricity Regulatory Commission • Board of Governors, Indian Institute of Management, Ahmedabad • Board of Governors Indian Institute of Technology, Kanpur • In June 2004, he was elected for a six-year term as an independent member of the Rajya Sabha, Upper House of India’s Parliament a position he chose to resign volu ntarily on March 25, 2006. Conferred the ‘CEO of the Year 2004’ in the Platts Global Energy Awards • Rated as one of ‘India’s Most Admired CEOs’ for the sixth consecutive year in the B ness Barons – TNS Mode opinion poll,2004 • Conferred ‘The Entrepreneur of the Decade Award’ by the Bombay Management Associati n, October 2002 • Awarded the First Wharton Indian Alumni Award by the Wharton India Economic Foru m (WIEF) in recognition of his contribution to the establishment of Reliance as a global leader in many of its business areas, December 2001. Anil D Ambani joined Reliance in 1983 as Co-Chief Executive Officer, and was ce ntrally involved in every aspect of the company s management over the next 22 ye ars. Awards & Achievements • Conferred the ‘CEO of the Year 2004’ in the Platts Global Energy Awards
• Rated as one of ‘India’s Most Admired CEOs’ for the sixth consecutive year in the B ness Barons – TNS Mode opinion poll,2004
• Conferred ‘The Entrepreneur of the Decade Award’ by the Bombay Management Associati n, October 2002 • Awarded the First Wharton Indian Alumni Award by the Wharton India Economic Foru m (WIEF) in recognition of his contribution to the establishment of Reliance as a global leader in many of its business areas, December 2001 • Selected by Asia week magazine for its list of ‘Leaders of the Millennium in Busin ess and Finance’ and was introduced as the only ‘new hero’ in Business and Finance fro m India, June 1999 • Voted MTV Youth Icon of the Year , in September 2003
• Voted as India’s “Business Icon For The Youth” in a poll conducted by India Today azine.- August 2006
Honorable members Amitabh Jhunjhunwala, vice president Shri Amitabhabh Jhunjhunwala, 51, is a Fellow Chartered Accountant. He has vast experience in the areas of financial services and capital markets. Shri Jhunjhun wala was appointed to the Board on March 7, 2003 and was appointed Vice Chairman
on March 20, 2006. He is a Director on the Board of Harmony Art Foundation and Reliance Anil Dhirubhai Ambani Group Pvt. Ltd. Rajendra Chitale, Independent Director Shri Rajendra P. . Chitalale, 46, an eminent Chartered Accountant, is the Managi ng Partner of M/s M. P. Chitale & Associates. He is a Director on boards of the National Securities Clearing Corporation Limited, Asset Reconstruction Company ( India) Ltd, Hinduja TMT Limited, HTMT Global Solutions Ltd, Ambuja Cement Limite d, SME Rating Agency of India Limited, Ishan Real Estate PLC and Reliance Genera l Insurance Company Ltd. He is also a member of the advisory board of the Insura nce and Regulatory Authority of India (IRDA). He has also served on the boards o f Life Insurance Corporation of India, Unit Trust of India, SBI Capital Markets Ltd., National Stock Exchange of India Ltd. and Small Industries Development Ban k of India. Shri C. P. Jain Shri C.P. Jain, 61, is the former Chairman and Managing Director of NTPC Ltd. (N ational Thermal Power Corporation). Shri Jain has an illustrious career spanning over four decades of contribution in the fields of financial management, genera l management, strategic management and business leadership. He is a fellow membe r of the Institute of Chartered Accountants of India with an advanced diploma in Management and is a law graduate. Shri C. P. Jain joined the Board of NTPC in 1 993 as Director (Finance), was elevated as Chairman & Managing Director in Septe mber 2000 and superannuated in March 2006. He is Chairman of the Global Studies Committee of World Energy Council (WEC), world s largest energy NGO with nearly hundred member-nations. He has been on several important committees of the Gover nment of India, latest being the Adhoc Group of Experts on Empowerment of CPSEs . He was Chairman of Standing Conference of Public Enterprises (SCOPE) between April 2003 and March 2005. He is a Director on the Board of IL & FS Infrastructu re Development Corporation and, is also a member of the Audit Advisory Board of the Comptroller and Audit General of India.
Reliance Capital Ltd is a part of the Reliance - Anil Dhirubhai Ambani Group, an d is ranked among the 25 most valuable private companies in India. Reliance Capital is one of India s leading and fastest growing private sector fi nancial services companies, and ranks among the top 3 private sector financial s ervices and banking groups, in terms of net worth. The Reliance Anil Dhirubhai Ambani Group is one of India s top 2 business houses , and has a market capitalization of over Rs.2,90,000 crore (US$ 75 billion), ne t worth in excess ofRs.55,000 crore (US$ 14 billion), cash flows of Rs. 11,000 c rore (US$ 2.8 billion) and net profit of Rs. 7,700 crore (US$ 1.9 billion Reliance Capital has interests in asset management and mutual funds, life and ge neral insurance, private equity and proprietary investments, stock broking, depo sitory services, distribution of financial products, consumer finance and other activities in financial services. Reliance Mutual Fund is India s no.1 Mutual Fu nd. Reliance Life Insurance is India s fastest growing life insurance company an d among the top 4 private sector insurers. Reliance General Insurance is India s fastest growing general insurance company and the top 3 private sector insurers . Reliance Money is the largest brokerage and distributor of financial products in India with more than 2 million customers and the largest distribution network
. Reliance Consumer finance has disbursed loans of over Rs.7,000 crores at the e nd of March 2008. Reliance Capital has a net worth of Rs.6,086 crores (US$ 1.5 billion) and total assets of Rs. 16,371 crores (US$ 4.1 billion) as of March 31, 2008 and over 21,0 00 employees.
Reliance capital holdings
RELIANCE ADA GROUP HOLDINGS
CHAPTER 4. ABOUT TOPIC RGICL PRODUCTS
Health • Individual Med claim Insurance Policy • Group Med claim Insurance Policy • Overseas Travel Care Insurance Policy • Reliance Health Wise Policy (inclusive of PED & Critical Illness) – NEW – a special zed retail product Personnel accident • Personal Accident Insurance (Individuals) Policy • Group Personal Accident Insurance Fire • • • Standard Fire and Special Perils Policy Industrial All Risks Insurance Policy Consequential Loss (Fire) Insurance Policy
Engineering • Erection All Risks/Storage-cum-Erection Insurance Policy • Contractor’s All Risks Insurance Policy • Contractor’s Plant and Machinery Policy • Machinery Breakdown Insurance Policy • Machinery Loss of Profits Insurance Policy • Boiler & Pressure Plant Insurance Policy
Electronic Equipment Insurance Policy
Marine • Marine Cargo Insurance Policy • NEW - Marine Turnover based Policy • NEW - Multi Transit Polices Motor •
Private Car Comprehensive Insurance Policy
Liability • Directors and Officers Liability Insurance Policy • Public Liability (Act) Insurance Policy • Public Liability Insurance Policy • Product Liability Insurance Policy • Professional Indemnity Insurance Policy • Workmen’s Compensation Insurance Policy Policies for corporate • • • • • • • Commercial Care Insurance Policy Office Package Insurance Policy Fidelity Guarantee Insurance Policy Burglary and Housebreaking Policy Money Insurance Policy Householder’s Package Insurance Policy Shopkeeper’s Package Insurance Policy
Reliance Shopkeeper’s package Policy Key Advantage • Comprehensive coverage against various perils spread across different sections o f the policy. • The policy offers the flexibility to customize the policy by selecting appropria te covers. • • • The coverage is available at reasonably priced premiums. Insured has the option of selecting coverage either on the basis of market value or the reinstatement value. Discounts ranging from 5% to 20% for customers opting for four or more sections, for favorable claims experience and on renewal of the policy.
Policy exclusions At reliance general insurance, we would like our policy to be as transparent as possible. To ensure that you do not face any unpleasant surprises when you make a claim, we would like you to know some of the major exclusions under the policy . • • • Loss or damage due to war and nuclear perils Damage to property due to pollution and contamination Loss or damage due to wear and tear, gradual deterioration or slowly developing
flaws • • Consequential loss of any kind Willful act or gross negligence on the part of the insured
Scope of the cover Coverage under this policy is spread across 11 optional sections, enabling you t o choose from them and customize the policy • • Section 1A. – Fire and allied perils for building Section 2B. – Fire and allied perils for contents
The physical structure of your shop (under section 1A) and the contents therein (under Section 1B) can be covered against fire and allied perils. These comprise:• • • • • • • Fire Lightning Explosion / implosion Aircraft Damage Riot, Strike and Malicious Damage Storm, Cyclone, Typhoon, Tempest, Hurricane, Tornado, Flood, and Inundation Impact Damage
• Subsidence and landslide including Rockslide demolition, construction, structura l alterations or repair of any property or ground works or excavations • • • • • Bursting and / or overflowing of water tanks, apparatus and pipes. Missile testing operations Leakage from automatic sprinkler installations Bush fire Terrorism cover (optional)
• Launched in 2002, PAN India CDMA based telecom service provider, an integrated t elecom company having largest infrastructure • India’s No. 1 wireless service provider with more than 50 million customers.
• Largest pan India coverage-over 11000 towns & 3 lakh villages. Over 10 million s ubscribers carry a handset that’s capable of getting high speed internet connectiv ity.
More than 50% of the international calls coming to India use Reliance network.
Reliance Life Insurance, a part of the Reliance - Anil Dhirubhai Ambani Group is India s fastest growing life insurance company and among the top 4 private sect or life insurers. Reliance Life Insurance has a pan India presence and a range of products caterin g to individual as well as corporate needs. Reliance Life Insurance has over 700 branches and 1, 80,000 agents. It offers 26 products covering savings, protecti on & investment requirements. Reliance Life Insurance will endeavor to attain a leadership position in the market over the next few years, by further expanding and strengthening its distribution network and offering a diverse array of produ cts to suit the varied and specific needs of individual customers.
What is Life Insurance? An amount of money paid to someone (called beneficiary) when the Life Assured (i n whose name the insurance policy is taken) dies. This amount can be used to pay the expenses related to Life assureds death or can be invested to generate income that will replace your sala ry. Life Insurance is an important tool in any investors portfolio & can be used for - wealth creat ion, asset building, provide for contingencies and retirement planning. The main reason to buy Life Insurance is to provide income replacement for your loved ones Types of Life Insurance Policies • Most Insurance policies are a combination of Savings & Protection. • Products are formulated by either increasing or decreasing either one of these c omponents. • These combinations can be broadly divided into 4 groups:ULIPs Term Insurance Endowment Policies : Whole Life; Unit Linked etc Annuities & Pension
18-25 years:- No dependents/ liabilities therefore need for insurance is less. I ntroduction of dependents, start of financial planning – balance between asset cre ation & protection. 30-45 years: - Peak earning age range. High asset creation & build up of liabili ties. Critical stage for dependents 40 years and above: - Asset base build up& liabilities reduced/taken care of. Ne ed for retirement planning more than risk taking. Retirement: - Need for protection low. Greater need for regular income flow
Basics of Life Insurance
Need Analysis in life Stages
Endowments/ULIP’s + Annuities
At each stage, requirements, responsibilities and Financial needs differ AGE STATUS INSURANCE NEEDS SUGGESTED PRODUCTS Yrs. Unmarried 1.Go on a holiday a new Car up a new house up Interiors jewellery Short term endowment product 25-30Yrs. Married 1.High Debt, high expenditure Phase 2.Family dependency on your income 3.Low accumulated wealth 4.Need for Planning Requirement Temporary product or Whole life product 30-45yrs. Matured Couple 1.Retirement Planning 2.Wealth transfer or saving vehicles 3.Returns on investment 4.Opting for guaranteed Product Profits or Unit Linked Endowment/Deferred Annuities 18-25 2.Buy 3.Set 4.Set 5.Buy
60Yrs and Above Post Retirement 1.Protection in case you live long 2.Protection for spouse in case of death 3.Wealth accumulation for children 1.Single Premium annuities 2.Long term care products 3.Whole life products
Life Stage Example Endowment
Savera has just come to our lives. As proud parents, We need to protect her as w ell as create her own financial standing Term
Hello, I am Philip, sailor. Have seen the world. Always on cruise and keep worry ing about family and the loans. I need financial protection. Annuities
Worked for almost 25 years, now want to live…. I want something that will make my life Chinta-free after retirement….
Products of Life Insurance Life Insurance products are usually referred to as ‘plans’ of insurance. These plans have two basic elements; one is the “Death Cover” providing for the benefits being paid on the death of the insured person within a specified period. The other is the “Survival Benefit” providing for the benefit being paid on survival of a specifi ed period. • • lans.
Plans of insurance that provide only death cover are called “Term Assurance” Plans. Plans of insurance that provide only survival benefits are called “Pure Endowment”
Term Life Insurance Term Life Insurance provides protection for a specified period of time. A death benefit is paid to the beneficiary if the insured dies within a specified period of time while the policy is still in force. Whole Life Insurance Whole Life insurance is a permanent life insurance and provides protection for l ife. As long as premiums are paid, a death benefit is paid to the beneficiary. ULIPs A ULIP is a life insurance which provides a combination of Life Insurance protec tion and investment. Money can be invested in the following fund:- Equity Fund, Debt Fund, Money Market Fund (Liquid Fund) and Balance Fund.
Annuities Annuities are practically the same as pension. Pension provides periodical payme nts to the employees, who have retired. They are paid as long as the recipient i s alive. Annuities are called the “reverse” of Life Insurance. Solutions for Individuals – RGI Taking time out from your daily schedule to plan your future is a necessary task . You could do with some help, but who can help you? Reliance Life Insurance is here with Solutions for Individuals, a series of plans that will help you make w ise investments, protect your family, secure your child’s future and even chalk ou t a plan for your retirement. • Protection Plans Protect your family even when you’re not around by investing in Reliance Protectio n Plans.Choose a limited period plan or a lifetime protection plan depending on your needs. The latest Protection Plans are as below:1. Reliance Term plan 2. Reliance Simple Term plan 3. Reliance Special Term plan 4. Reliance Credit Guardian plan 5. Reliance Special Credit Guardian plan 6. Reliance Endowment plan 7. Reliance Special Endowment plan 8. Reliance Connect 2 Life plan 9. Reliance Whole Life plan 10. Reliance Wealth + Health plan 11. Reliance Cash Flow plan • Savings & Investment Plans Reliance Savings & Investment Plans help you to set aside some money to achieve specific goals in life, which means that you can enjoy life and provide for your family’s daily needs. The savings and investment Plans are as below:1. Reliance Total Investment Plan Series I - Insurance 2. Reliance Wealth + Health plan 3. Reliance Automatic Investment plan 4. Reliance Money Guarantee plan 5. Reliance Cash Flow plan 6. Reliance Market Return plan 7. Reliance Endowment plan 8. Reliance Special Endowment plan 9. Reliance Whole Life plan 10. Reliance Golden Years Plan 11. Reliance Golden Years Plan Value 12. Reliance Golden Years Plan Plus 13. Reliance Connect 2 Life plan 14. Reliance life Highest NAV guarantee plan Retirement Plans Invest today in Reliance Retirement Plans and save money to enjoy life even afte r retirement. You will never have to depend on another person or make any compro mises to maintain your current lifestyle. The latest Retirement Plans are as bel ow:1. Reliance Total Investment Plan Series II – Pension 2. Reliance Golden Years Plan 3. Reliance Golden Years Plan Value
4. 5. 6. 7.
Reliance Reliance Reliance Reliance
Golden Years Plan Plus Wealth + Health plan Automatic Investment Plan Money Guarantee Plan
Child Plans Save systematically and secure your child’s future needs by investing in Reliance Child Plans. You can always be there for your child when he or she needs you. Th e Childs plans are as below:1. Reliance Child plan 2. Reliance Secure Child plan 3. Reliance Wealth + Health plan Market Return Plan Under This plan the investment risk in the investment portfolio is borne by the Policy holder. Key features • Twin benefit of market linked return and insurance protection • A unit linked plan, different from traditional life insurance products with maxi mum maturity age of 80 years. • Option to create your own portfolio depending on your risk appetite. • Choose from four different investment funds • Flexibility to switch between funds • Option to pay regular as well as single premium & top- ups • Option to package your policy with accidental rider • Flexibility to increase the sum assured • Liquidity through partial withdrawals How does this plan work The premium paid by the client net of premium allocation charges is invested in fund/funds of your choice and units are allocated depending on the price of unit s for the fund/funds. The fund value is the total value of units that you hold i n the fund/funds. The mortality charges and policy administration charges are du cted through cancellation of units whereas the fund management charge is priced in the unit value. Benefits Life cover Assured: in case of unfortunate loss of life, the beneficiary will ge t sum assured or fund value, whichever is higher. The client can choose the basi c sum assured within the minimum and maximum levels mentioned below. Minimum sum Assured: • Regular premium: annualized premium for 5 years or annualized premium for half t he Policy term, whichever is higher. • Single premium: 125% of the single premium. Maximum sum Assured No limit (50000 for age up to 12 years) Maturity Benefits On survival to maturity the fund value on maturity will be paid out. Rider Benefits
The Client can add the Accidental Death & Total and Permanent Disablement Benefi t Rider (available only with the regular premium option). This benefit doubles the life coverage in case of accidental death or accidental total and permanent disablement at a very nominal additional cost. The maximum cover is Rs. 50, 00,000 per life. In case of accidental death of the life assure d during the policy term, the accident benefit sum assured will be paid immediat ely in a lump sum. In case of accidental total and permanent disablement, 1/10th of the accident be nefit sum assured will be paid at the end of each year for ten years. If the tot al and permanent disablement has commenced, the accidental death benefit cover c eases. In case of maturity or on death of the life assured before payment of all instal lments of accidental total and permanent disablement benefits, the remaining unp aid installments of any will be paid in one lump sum along with death or maturit y benefit. Accidental total and permanent disablement means disability caused by bodily inj ury, which causes permanent inability to perform any occupation or to engage in any activities for remuneration or profits. This disability should last for at l east 6 months before being eligible for accidental total and permanent disableme nt benefits. Accidental total and permanent disablement includes loss of both arms and both l egs or one arm and one leg or of both eyes. Loss of arms or legs means dismember ment by amputation of the entire hand or foot. Loss of eyes means entire and irr ecoverable loss of sight.
What are the different fund options? We understand the value of your hard earned money and in our Endeavour to help y ou grow your wealth, we offer you 4 different tailor-made investment funds. You hav e the option to allocate your premium in these funds as you wish. They are: 1. Capital Secure Fund:
The investment objective of this fund is to maintain the value of all contributi ons (net of charges) and all interest additions. This fund offers steady return for little risk. The risk profile of this fund is low. Investments would be 100% in bank deposits, go vernment bonds and debt instruments that offer financial security. Further, allo cation in Capital Secure Fund for a policy is subject to a maximum limit of 40% at any time. 2. Balanced Fund:
The investment objective of this fund is to provide you with investment returns, which exceed the rate of inflation in the long term while maintaining a low pro bability of negative investment returns. Here, a major portion of your funds are invested in Fixed Securities while a small percentage is invested in the equity market, which is exposed to market movements. The risk profile of this fund is low to medium. Investments would be at least 80% in fixed interest securities an d maximum 20% in equities.
3. Growth Fund: The investment objective of this fund is to provide you with investment returns, which exceed the rate of inflation in the long term while maintaining a moderat e probability of negative investment returns. A greater portion of your funds ar e invested in fixed securities while a small percentage is invested in the equit y market, which exposed to market movements. The risk profile of this fund is me dium to high. 4. Equity Fund: The investment objective of this fund is to provide policyholders with high expo sure to equities and the possibility of investment returns, which generate a hig h real rate of return in the long term while recognizing that there is a signifi cant probability of negative investment returns in the short term. This fund off ers a totally equity based investment option. Your returns depend entirely upon the performance of the equity market. The risk profile of this fund is high. The higher risk of this portfolio means that expected returns would also be higher. Investment would not exceed 30% in bank deposits and may be up to 100% in equit ies. Value of Units: Unit Value = Total number of units on issue (before any new units Are allocated/redeemed.) or Unit Value= The market value of assets plus/less expenses incurred In the purchase/sale of a ssets plus current assets plus Any accrued income net of fund management charges Less current liabilities less provision.
Who can buy the product Minimum age at entry 30 days Maximum age at entry 65 years Maximum age at Maturity 80 years
What is the policy term? Minimum Policy term
5 years Maximum Policy term 40 years Flexible premium payment modes: Choose from five premium payment modes:a) b) c) d) e) Annual – minimum premium is Rs. 10,000. Half – yearly – minimum premium is Rs. 5,000. Quarterly – minimum premium is Rs. 2,500. Monthly – minimum premium is Rs. 1,000. Single premium – minimum premium is Rs. 25,000. Charges under the plan: 1. Premium allocation charge Term of the Policy Policy year Allocation Charges Reduced Allocation charges for policy sold through direct mrkt/internet For regular premium Ist Year 20% 5% II & III Year 3% 0 IV & V year 2% 0% VIth year & onwards 1% 0% For single premium & top up Premium 2% 1% (The premium allocation charge for single premium & top – ups is 2 %.) 2. Policy Administration charges: Rs. 40 will be deducted from your unit account each month. 3. Fund Management Charges: For highest NAV guaranteed fund is1.35%is built into the NAV Revision of charges: The fund management charges are subject to revision at any time, but hey will no t exceed 2% p.a. for the capital secure fund and 2.5% p.a. for the other funds. Any changes made to the charges under this policy will be subject to IRDA approv al. 4. Surrender Charge/ partial withdrawl This charge is levied on the unit fund at the time of surrender of the policy as under: Would be as applicable if exercised no charges on withdrawal or surrender from t op up and single premium policy. 5. Service Tax Charge This charge will be levied on mortality, accident & disability benefit charges. The level of this charge will be as per the rate of service tax on risk premium levied by the government from time to time the correct rate of service tax is 10 .3% this charge shall be collected along with charges.
How safe is your investment • The investments made in the unit funds are subject to investment risks associate d with capital markets and the NAVs of the units may go up or down based on the performance of the fund and the factors influencing the capital market, and the insured is responsible for his/her decisions. • The unit price is a reflection of the financial and equity/debt market condition s and can increase or decrease at any time due to this. • Benefits payable under the policy will be made according o the tax laws and othe r regulations in force at that time. • There are no guarantees for any fund of any kind under this policy. The benefit payable on maturity will be equal to the value of your units. • The name in the funds in n way indicates the returns derived from them. • Please note that Reliance life Insurance company limited is only the name of the insurance company and Reliance market return plan is only the name of the unit linked life insurance policy and does not in anyway indicate the quality of the policy or its future prospects or returns.
Free Look Period. In case the policyholder disagrees with any of the terms and conditions of the p olicy, he may return the policy to the company within 15 days of its receipt for cancellation, stating his/her objections in which case the company will refund an amount equal to the non allocated premium plus the charges levied by cancella tion of units plus fund value as on the date of receipt of the request in writin g for cancellation, less the proportionate premium for the period the company ha s been on risk and the expenses incurred by the company medical examination and stamp duty charges. If the risk acceptance date falls within cooling off period, then on ca ncellation RLIC hall pay fund value less of charges.
IRDA Insurance Regulatory and Development Authority
The Insurance Regulatory and Development Authority (IRDA) is a national agency o f the Government of India, based in Hyderabad. It was formed by an act of Indian Parliament known as IRDA Act 1999, which was amended in 2002 to incorporate som e emerging requirements. Mission of IRDA as stated in the act is "to protect the interests of the policyholders, to regulate, promote and ensure orderly growth of the insurance industry and for matters connected therewith or incidental ther eto." Mission To protect the interests of the policyholders, to regulate, promote and ensure o rderly growth of the insurance industry and for matters connected therewith or i ncidental thereto.
Composition of authority As per the section 4 of IRDA Act 1999, Insurance Regulatory and Development Aut hority IRDA, which was constituted by an act of parliament) specify the composit ion of Authority. The Authority is a ten member team consisting of:(a) A Chairman; (b) Five whole-time members; (c) Four part-time members, (all Appointed by the Government of India) DUTIES, POWER & FUNCTIONS OF IRDA: Section 14 of IRDA Act, 1999 lays down the duties, powers and functions of IRDA. .. (1) Subject to the provisions of this Act and any other law for the time being i n force, the Authority shall have the duty to regulate, promote and ensure order ly growth of the insurance business and re-insurance business. (2) Without prejudice to the generality of the provisions contained in sub-secti on the powers and functions of the Authority shall include:(a)Issue to the applicant a certificate of registration, renew, modify, withdraw , suspend or cancel such registration; (b) protection of the interests of the policy holders in matters concerning assi gning of policy, nomination by policy holders, insurable interest, settlement of insurance claim, surrender value of policy and other terms and conditions of co ntracts of insurance; (c) specifying requisite qualifications, code of conduct and practical training for intermediary or insurance intermediaries and agents; (d) specifying the code of conduct for surveyors and loss assessors; (e) promoting efficiency in the conduct of insurance business; (f) promoting and regulating professional organizations connected with the insur
ance and re-insurance business; (g) levying fees and other charges for carrying out the purposes of this Act; (h) calling for information from, undertaking inspection of, conducting enquirie s and investigations including audit of the insurers, intermediaries, insurance intermediaries and other organizations connected with the insurance business; (i)control and regulation of the rates, advantages, terms and conditions that ma y be offered by insurers in respect of general insurance business not so control led and regulated by the Tariff Advisory Committee under section 64U of the Insu rance Act,1938 (4 of 1938); (j) specifying the form and manner in which books of account shall be maintained and statement of accounts shall be rendered by insurers and other insurance int ermediaries; (k) regulating investment of funds by insurance companies; (l) regulating maintenance of margin of solvency; (m) adjudication of disputes between insurers and intermediaries or insurance in termediaries; (n) supervising the functioning of the Tariff Advisory Committee; (o) specifying the percentage of premium income of the insurer to finance scheme s for promoting and regulating professional organisations referred to in clause.
CHAPTER 5. ANALYSIS & INTERPRETATION DATA GIVES PREFERENCE OF RESPONDENTS OF INSURANCE COMPANIES COMPANY’S NAME NO.OF RESPONDENT SHARE (%) L.I.C. 78 78 RELIANCE LIFE INSURANCE 3 3 ICICI PRUDENTIAL 10 10 SBI LIFE 7 7 HDFC 2 2 TOTAL 100 100 INTERPRETATION 78% of the people contacted prefer LIC policy to any other and therefore it is r anked no.1 by that percent of respondents. DATA GIVES BENEFITS OF INSURANCE PERCEIVED BY RESPONDENTS BENEFITS NO.OF RESPONDENTS SHARE (%) Cover Future Uncertainty 55 55
Tax Deductions 20 Future Investment TOTAL 100 100
INTERPRETATION 55% of the respondents believe that covering future uncertainty is the biggest b enefit of an insurance policy. Whereas, 20% and 25% of them believe that the other benefits are Tax deduction a nd future investments respectively. DATA PROVIDES FEATURES OF INSURANCE POLICY THAT ATTRACTED RESPONDENTS FEATURE NO.OF RESPONDENTS SHARE (%) Money Back Guarantee 15 15 Larger Risk Coverance 37 37 Easy Access to Agents 7 7 Low Premium 30 30 Company’s Reputation 11 11 TOTAL 100 100 INTERPRETATION Majority of the respondent (37%) found Larger risk coverance as the most attract ed feature of the all. DATA PROVIDES NUMBER OF INSURANCE POLICY TYPE RESPONDENTS POLICY TYPE NO. OF RESPONDENTS SHARE (%) LIFE POLICY 75 75 NON LIFE POLICY 25 25 BOTH 45 45 INTERPRETATION 75% of the respondents have Life Insurance Policy while 45% have both. (The % is calculated out of 280 positive response) DATA GIVES PEOPLE PERCEPTION ABOUT INSURANCE RESPONSE NO. OF RESPONDENTS SHARE (%) A saving tool 81 81% A tax saving device 74 74% A tool to protect your family 100 100% INTERPRETATION • 81% of the respondents have perception of Insurance being a saving tool. • And 74% of the respondents have perception of Insurance being a tax saving devic e. • But 100% of the respondents are with the view that Insurance is a tool to protec t your family. DATA SHOWS PEOPLES HAVING INSURANCE RESPONSE NO. OF RESPONDENTS SHARE (%) Yes 70 70% No 30 30% Total 100 100% • Of the sample size of 400 surveyed respondents 70% of the respondents are having Insurance policy. • 30% of the respondents are either not having any Insurance policy at present or their policy is already matured.
• And at present 100% of the respondents are with the view that Insurance is a too l to protect your family. DATA SHOWS BUYING PROCESS OF THE PEOPLE BUYING PROCESS NO. OF RESPONDENTS SHARE (%) Customer approached Insurance company/Agent 45 45% Company/agent approached customer 55 555 Total 100 100% INTERPRETATION • 44.5% of the respondents approached the Insurance Company / Agent. • Whereas, 55.5% of the respondents were approached by the Company /Agent. DATA SHOWS REASONS BEHIND FOR INSURANCE RESPONSE NO. OF RESPONDENTS SHARE (%) Tax saving 80 80% Saving / Investment 80 80.% Family protection 100 100% INTERPRETATION • 80.71% of the Respondents opted for Insurance for tax saving benefits. • 80.71% of the Respondents opted for saving / Investments. • But all of them, i.e. 100% of the respondents have opted for insurance for their family protection. DATA SHOWS SATISFACTION OF RESPONDENTS WITH RESPECT TO POLICY RESPONSE NO. OF RESPONDENTS SHARE (%) Satisfied 60 60% Not satisfied 40 40% Not Responded 0 0.0% Total 100 100% INTERPRETATION • 60% of the respondents are more or less satisfied with their existing policy. • 40% of the respondents are not satisfied with their existing policy. • In this case all of those who have taken a policy have responded. DATA SHOWS SATISFACTION OF +RESPONDENTS WITH RESPECT TO SERVICE AGENT RESPONSE NO. OF RESPONDENTS SHARE (%) Satisfied 45 45% Not satisfied 55 55% Not Responded 0 0.0% Total 100 100% INTERPRETATION • 45% of the respondents are satisfied with their existing service agent. • 55% of the respondents are not satisfied with their existing insurance agent. • All of those who have taken a policy have responded. DATA SHOWS NUMBER OF RESPONDENTS PAYING TAX RESPONSE NO. OF RESPONDENTS SHARE (%) Paying tax 100 100% Not paying tax 0% Total 100 100% INTERPRETATION • Of the sample size of 400 respondents, all the respondents are paying tax. DATA SHOWS RESPONDENT’S INVESTMENTS FOR TAX SAVING INVESTMENTS NO. OF RESPONDENTS SHARE (%) LIC 51 51% NSC 33 33% Bonds 32 32% PPF 25 25% PF 21 21%
EPF 11 11% INTERPRETATION • 51% of the respondents save their tax by investing in LIC, which is the highest among all Investment. This shows that most people for getting taxes benefits inv est in LIC. • 33.25% of the respondents do their tax saving by investing in NSC. • 32.25% of the respondents to their tax saving by investing in bonds. DATA SHOWS RESPONDENTS PERCEPTION ABOUT BEST FORM OF INVESTMENT FOR SECURING THE IR FUTURE NO. OF RESPONDENTS SHARE (%) Fixed Assets 75 75% Bank deposits 11 11% Jewellery 25 25% Securities i.e. bonds, MFs 40. 40% Shares 10 10% Insurance 70 70% INTERPRETATION • 75.25% of the respondents as with the view that Fixed Assets is the best form of investment for securing their future. • 70.5% of the respondents are with the perception that Insurance is the best form of investment for securing their future, which is one of the highest and this s hows that insurance is an important key for securing your future. DATA SHOWS WHAT PEOPLE INTENT TO GAIN FROM THEIR INVESTMENT RESPONSE NO. OF RESPONDENTS SHARE (%) Saving & Returns 100 100% Security 90 90% Tax benefits 71. 71.%
INTERPRETATION • 100% of the respondents intent to gain saving and returns from their investment. • • ents. 90% of the respondent’s intent to gain security from their investments. Whereas, 71.75% of the respondent’s intent to gain tax benefits from their investm
DATA GIVES PEOPLE’S PERCEPTION ON APPROPRIATE AGE FOR BUYING INSURANCE RESPONSE NO. OF RESPONDENTS SHARE (%) After 25 years 29 29% After 35 years 10 10% After 45 years 0 0% Anytime 60 60% INTERPRETATION • 29% of the respondents are with the view that insurance should be bought after t he age of 25 years. • 10.5% of the respondents are with the view that insurance should be buyed after
the age of 35 years. • Whereas, 60.5% of the respondents are with the view that buying of insurance do not have any thing to do with age i.e. there is no age limitations. It can be pu rchased any time according to the need. DATA SHOWS PEOPLE OPINION ABOUT INDIAN INSURANCE COMPANIES RESPONSE NO. OF RESPONDENTS SHARE (%) Rigid plans 67 67% Non user friendly 29 29% Unsatisfactory services 26 26% Non Aggressive 35 35% Satisfactory 24 24% Good 10 10% Very good 0 0% INTERPRETATION • 67% of the respondents have the opinion that Indian Insurance Companies have Rig id plans. • 29.5% feel that Indian Insurance companies are Non-user friendly. • 26.5% feel that services of Indian Insurance companies are Unsatisfactory. • 35.75% of the respondents are with the view that Indian Insurance companies are Non-aggressive. • 24% of the respondents feel that products and services of Indian Insurance compa nies is Satisfactory. • Whereas only 10.25% feel that it is Good enough. • And according to the data, no single person has felt that it is very good. DATA SHOWS WHAT PEOPLE WOULD LOOK FOR IN AN INSURANCE COMPANY RESPONSE NO. OF RESPONDENTS SHARE (%) A trusted name 82 82% Friendly service & responsiveness 71 71% Good plans 81 81% Accessibility 49 49%
INTERPRETATION • 82% customers look for a Trusted name in a company for insurance. • 81.5% customers look for a good plan in a company for insurance. • Friendly service & responsiveness and Accessibility are also important factors l ooked by customers in a company. • DATA SHOWS PEOPLE PLANNING FOR NEW INVESTMENTS RESPONSE NO. OF RESPONDENTS SHARE (%) Planning 87 87% Not planning 13 13% Total 100 100% INTERPRETATION • Only 12.5% of the customers contacted are not planning for new investments prese ntly. • Whereas, 87.5% of the customers are still planning for new investments this can be a great potential for Reliance Life Insurance to take them on their favor.
DATA SHOWS PEOPLE INTERESTED IN GOING FOR INSURANCE IF A SERVICE PROVIDER AWAY F ROM THE CITY OFFERS BETTER SERVICE & PRODUCTS RESPONSE NO. OF RESPONDENTS SHARE (%) Yes 43 43% No 44 44% Uncertain 13 13% Total 100 100%
INTERPRETATION The interested customers i.e. 43% are ready to go for insurance even away from a city if services and products are worthwhile, which again is a good prospect (p otential) for Reliance Life Insurance to take them on their favor.
CHAPTER 6. FINDINGS (IF ANY) According the survey only 42% people are insured in Alwar so reaming other part is potential for insurance sector. Among that 42% people who having insurance, they have insurance 40% for self 28% for spouse 21% for children and 18% for their parents and 11% for all family mem ber, also its very help full for insurance sector so they should take necessary step for capture this potential. Only 42% people having insurance in Alwar in that 42% there are 82 % people are under insured and other 18% people are fully insured according to their income s o that is also plus point for insurance sector to capture the market
CHAPTER 7. SUGGESTION & RECOMMENDATION
1. Reliance Life Insurance should give more attention on its Quality and method of Recruitment & Selection because it helps the company in reducing attrition ra te and selecting the right candidate to serve the company for a long period. 2. Reliance Life Insurance should give more advertisement in Magazines & Newspap ers regarding the New Hire Process and New Recruitments. 3. Reliance Life Insurance should maintain the communication through feedback. T hey should take time-to-time feedback regarding customer satisfaction to know ab out the customer perception about their insurance products. 4. Budget required for Recruitment & Selection Process must be economical. 5. Reliance Life Insurance should find out the factors for which the customers a re purchasing their policies. This will help it in making appropriate message in advertisement so that that advertisement will much focused and targeted and may attract excellent candidates to serve the company. 6. Reliance Life Insurance which prefer remote areas also for selling its polici es must hire from there to due to localize expertise. 7. Reliance Life Insurance should make the provision for change in Recruitment & Selection Methodology with the advent of time and newer technology. 8. Reliance Life Insurance should provide all details related to any promotions, company schemes and Packages at the time of Final Selection. 9. The person conducting the Interview should make sure that candidate being int erviewed shows better ability to listen, understand and answer queries. 10. Reliance Life Insurance should ensure that the company is innovative and int roduces new products to meet new customer’s needs and keeps on check with the comp etitors too.
CHAPTER8. CONCLUSION Our exhaustive research in the field of Life Insurance threw up some interesting trends which can be seen in the above analysis. A general impression that we ga thered during Data collection was the immense awareness and knowledge among peop le about various companies and their insurance products. People are beginning to look beyond LIC for their insurance needs and are willing to trust private play ers with their hard earned money. People in general have been impression by the marketing and advertising campaign s of insurance companies. A high penetration of print , radio and Television ad campaigns over the years is beginning to have its impact now. The general satisfaction levels among public with regards to policy and agents s till requires improvement. But therein lays the opportunity for a relative new comer like ING. LIC has never been known for prompt service or customer oriented methods and Reliance can buil d on these factors.
BIBLIOGRAPHY 1. BOOKS/MAGAZINES REFFERED: Study Guide – Principles and Practices of Life/General Life Insurance, by AIMA Life Insurance, By Mc Gill Money Outlook 2. WEBSITES REFFERED: http://www.lifeinscouncil.org/ http://money.outlookindia.com/article.aspx?266705 http://www.scribd.com/search?cat=redesign&q=reliance+life+insurance&x=0&y=0 http://www.reliancelife.com/rlic/AboutUs/our_founder.aspx http://en.wikipedia.org/wiki/Reliance_Life_Insurance 3. REPORTS/ARTICLES REFFERED:
REPORT: ISSUES & CHALLENGES FACING THE INSURANCE INDUSTRY Dec2009 4. Telephone Numbers Call 30338181 or 1800 300 08181 (toll-free)
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