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“consumer buying behaviour towards life insurance

in shirram life insurance”

Summer Internship Project submitted to Jain (Deemed-to-be University) in partial

fulfillment of the requirements for the award of

Master of Business Administration

Submitted by
Kamle Uday kumar
Register No.:
19MBAJ0164

under the guidance of

Prof. L. Surendra
Professor

Jain (Deemed-to-be University), Bangalore

2020

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Prof. L. Surendra

Professor,

Jain (Deemed-to-be University)

CERTIFICATE

I certify that this research entitled “consumer buying behaviour towards life insurance in
shirram life insurance”submitted to Jain (Deemed-to-be University) in partial fulfillment of
the requirements for the award of MBA, is a record of independent work carried out by Mr.
KAMLE Uday Kumar under my supervision and guidance. This work has not formed the
basis for the award of any Degree and has not been submitted previously to any other
College/University

Bangalore Prof. L. Surendra

Date Faculty Mentor

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DECLARATION

I hereby declare that the Summer Internship Project undertaken by me at Shikha

uphadaya under the guidance of Prof. L. Surendra Jain (Deemed-to-be University),

Bangalore is an independent work.

The report is towards the partial fulfillment of the Master of Business Administration

course of Jain (Deemed-to-be University), Bangalore for the batch of 2019-21.

Bangalore Kamle Uday kumar

Date:

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CONTENT

List of tables 5
List of Figure 6
Executive Summery 7
Chapter - 1 Introduction and industry overview 8 – 23
1.1 Industry Overview
1.2 Global Scenario
1.3 Indian Scenario
1.4 Industry Structure
1.5 Industry Outlook
Chapter – II Company Overview 24 – 44
2.1 Company Overview
2.2 Financial Performance
2.3 Products
2.4 SWOT Analysis
2.5 Overview of different departments
2.6 Future Outlook
Chapter - III Project Profile 45 – 60
3.1 Purpose of the Study
3.2 Statement of the Problem
3.3 Objectives and scope
3.4 work done in the company
3.5 Methodology
3.6 Date collection, Interpretation and analysis
Key learnings
Chapter – IV 61 – 67
and Recommendations
4.1 Observations
4.2 Expectations and Achievements
4.3 Learning Outcome
4.4 recommendations
4.5 Findings and Conclusions
 Bibliography
LIST OF FIGURES

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SI.NO FIGURE NO TITTLE OF FIGURE PG.NO

1 Fig .1.2 The global insurance industry 17
backed by APAC

2 Fig .2.4 SWOT analysis 34

3 Fig .2.6a Inflation graph 42
4 Fig .2.6b IIP graph 43
5 Fig .2.6c Inflation (CPI) graph 43
6 Fig .2.6d Outlook for equities 44
7 Fig .2.6e Outlook for debts 44
8 Fig .3.6a Gender of people who attended the 49
survey
9 Fig .3.6b Age of people who attended the 50
survey
10 Fig .3.6c Income of people who attended the 50
survey
11 Fig .3.6d occupation 51
12 Fig .3.6e Educational level 51
13 Fig .3.6f Investment preference 52
14 Fig .3.6g Preference to buy insurance 53
15 Fig .3.6h Current insurance policy 54
16 Fig .3.6i Annual premium 55
17 Fig .3.6j Purpose of investment 56
18 Fig .3.6k Features of policy 57
19 Fig .3.6l Awareness through channel 59
20 Fig .3.6m Awareness of product 60

Executive summary
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Executive Summary The insurance sector in India has come a full circle
from being an open competitive market to nationalization and back to a
liberalized market again.
The goal of the task was to do Market Research and consumer buying behavior
towards Shriram Life Insurance for that we need to comprehend the client
needs, Income, limitations, reaction and feelings.
For an organization it is fundamental to know the requirement of clients so
as to plan compelling advertising and deals systems in future and
improve the nature of administration to accomplish better customer
fulfilment.
A questionnaire was prepared which gave a vague idea about the people
who were really interested and wanted to know about various new
opportunities in the insurance sector.

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CHAPTER : 1
INTRODUCTION AND INDUSTRY
OVERVIEW

INTRODUCTION AND INDUSTRY OVERVIEW

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1.0 HISTORY OF INSURANCE

Insurance has been around since ancient times. The Babylonians and Phoenicians had
ocean marine insurance to protect a merchant against losses incurred when a ship did not
reach its intended destination with its load of goods or did not return with payment. This form
of insurance, called Respondentia, evolved because the goods on board often were used as
collateral for a loan. The lender charged the borrower interest on the loan and levied an
additional sum, the premium, to cover the cost of the respondentia contract. If the ship
reached its destination and returned, the merchant received payment for the goods and in turn
paid the moneylender. If the ship failed to return, the debt was cancelled. This system was
profitable to lenders because many respondentia contracts were sold, and debts were paid
more often than cancelled. In ancient Rome, associations had a form of insurance for their
members. Each member made regular payments to the association in return for coverage of
funeral expenses or for assistance to family members who were injured or ill.

Insurance also existed in 17th-century England, which was then one of the world's principal
maritime powers. Those seeking marine insurance would post a list of their cargo and
voyages in a London coffee house owned by Edward Lloyd. Private investors would
examine the list and sign their name by the entries they were willing to guarantee for a fee.
These private investors were the first insurance underwriters, and the coffee house became
the world center of marine insurance. Today the organization is known as Lloyds of London,
and it brings together individuals, most often working in syndicates, who write all types of
insurance.

Insurance in the modern form originated in the Mediterranean during 14th century. The
earliest references to insurance have been found in Babylonia, the Greeks and the Romans.
The use of insurance appeared in the account of North Italian merchant banks who then
dominated the international trade in Europe at that time. Marine insurance is the oldest form
of insurance followed by life insurance and fire insurance. The patterns that have been used
in England followed in other countries also in these kinds of insurance.

The oldest and the earliest records of marine policy relates to a Mediterranean voyage in
1347. In the year 1400, a book written by a merchant of Florence, indicates premium rates

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charged for the shipments by sea from London to Pisa. Marine Insurance spread from Italy to
trading routes in other countries of Europe.

Fire insurance has its origin in Germany where it was introduced in municipalities for
providing compensation to owners of the property, in return for an annual contribution, based
on the rent of those premises. The fire insurance in its present form started after the most
disastrous fire in human history known as the 'Great Fire' in London, which had destroyed
several buildings. It drew the attention of the public and the first fire insurance commercially
transacted in 1667. The Industrial Revolution (1720-1850) gave much impetus to fire
insurance. The Nineteenth century marked the development of fire insurance.

Due to the increasing demands of the time, different forms of insurance have been developed.
Industrial Revolution of 19th century had facilitated the development of accidental insurance,
theft and dacoits, fidelity insurance, etc. In 20th century, many types of social insurance
started operating, viz., unemployment insurance, crop insurance, cattle insurance, etc. This
way the business of insurance developed simultaneously with human and social development.
Today, the use of computers in the field of insurance is frequently increasing. Insurance
becomes an inseparable part of human development.

The early developments of life insurance were closely linked with that of marine insurance.
The first insurers of life were the marine insurance underwriters who started issuing life
insurance policies on the life of master and crew of the ship, and the merchants. The early
insurance contracts took the nature of policies for a short period only. The underwriters issued
annuities and pension for a fixed period or for life to provide relief to widows on the death of
their husbands. The first life insurance policy was issued on 18th June 1583, on the life of
William Gibbons for a period of 12 months.

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 premium was charged for
Indian lives than the non-Indian lives as Indian lives were considered more riskier for
coverage. The Bombay Mutual Life Insurance Society started its business in 1870. It was the
first company to charge same premium for both Indian and non-Indian lives. The Oriental
Assurance Company was established in 1880. The first general insurance company- Tital
Insurance Company Limited was established in 1850. Till the end of nineteenth century
insurance business was almost entirely in the hands of overseas companies.

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Insurance regulation formally began in India with the passing of the Life Insurance
Companies Act of 1912 and the Provident Fund Act of 1912. Several frauds during 20's and
30's sullied insurance business in India. By 1938 there were 176 insurance companies. The
first comprehensive legislation was introduced with the Insurance Act of 1938 that provided
strict State Control over 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, insurance 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 LIC was born.
Nationalization was justified on the grounds that it would create much needed funds for rapid
industrialization. This was in conformity with the Government's chosen path of State- led
planning and development.

1.1 INTRODUCTION TO INSURANCE SECTOR

The insurance sector in India has come a full circle from being an open competitive market to
nationalization and back to a liberalized market again. Tracing the developments in the Indian
insurance sector reveals the 360-degree turn witnessed over a period of almost 190 years. The
business of life insurance in India in its existing form started in India in the year 1818 with
the establishment of the Oriental Life Insurance Company in Calcutta.

Some of the important milestones in the life insurance business in India are:

1912– The Indian Life Assurance Companies Act enacted as the first statute to
regulate the life insurance business.
1928 – The Indian Insurance Companies Act enacted to enable the government to collect
statistical information about both life and non-life insurance businesses.

1938 – Earlier legislation consolidated and amended to by the Insurance Act with the
objective of protecting the interests of the insuring public.
1956 – 245 Indian and foreign insurers and provident societies taken over by the central

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government and nationalized. LIC formed by an Act of Parliament, viz. LIC Act, 1956,
with a capital contribution of Rs. 5 crores from the Government of India.

The General insurance business in India, on the other hand, can trace its roots to the Triton
Insurance Company Ltd., the first general insurance company established in the year 1850 in
Calcutta by the British.

Some of the important milestones in the general insurance business in India are:

1907 – The Indian Mercantile Insurance Ltd. set up, the first company to transact all
classes of general insurance business.
1957 – General Insurance Council, a wing of the Insurance Association of India, frames a
code of conduct for ensuring fair conduct and sound business practices.

1968 – The Insurance Act amended to regulate investments and set minimum
solvency margins and the Tariff Advisory Committee set up.
1972 –The General Insurance Business (Nationalization) Act, 1972 nationalized
the general insurance business in India with effect from 1st January 1973.

107 insurers amalgamated and grouped into four companies’ viz. the National Insurance
Company Ltd., the New India Assurance Company Ltd., the Oriental Insurance Company
Ltd. and the United India Insurance Company Ltd. GIC incorporated as a company.

REFORMS OF INSURANCE SECTOR :

In 1993, Malhotra Committee headed by former Finance Secretary and RBI Governor R.N.
Malhotra was formed to evaluate the Indian insurance industry and recommend its future
direction.

The Malhotra committee was set up with the objective of complementing the reforms
initiated in the financial sector. The reforms were aimed at "creating a more efficient and
competitive financial system suitable for the requirements of the economy keeping in mind

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the structural changes currently underway and recognizing that insurance is an important part
of the overall financial system where it was necessary to address the need for similar reform.

In 1994, the committee submitted the report and some of the key recommendations included:

1 STRUCTURE :

Government stake in the insurance Companies to be brought down to 50% Government

should take over the holdings of GIC and its subsidiaries so that these subsidiaries can act as
independent corporations. All the insurance companies should be given greater freedom to
operate

2 COMPETITION:

Private Companies with a minimum paid up capital of Rs.1bn should be allowed to enter the
industry No Company should deal in both Life and General Insurance through a single entity.
Foreign companies may be allowed to enter the industry in collaboration with the domestic
companies Postal Life Insurance should be allowed to operate in the rural market. Only One
State Level Life Insurance Company should be allowed to operate in each state.

3 REGULATORY BODY :

The Insurance Act should be changed An Insurance Regulatory body should be set up
Controller of Insurance (Currently a part from the Finance Ministry) should be made
independent

4 INVESTMENTS :

Mandatory Investments of LIC Life Fund in government securities to be reduced from 75%
to 50% GIC and its subsidiaries are not to hold more than 5% in any company (There current
holdings to be brought down to this level over a period of time)

5 CUSTOMER SERVICE :

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LIC should pay interest on delays in payments beyond 30 days Insurance companies must be
encouraged to set up unit linked pension plans. Computerization of operations and updating
of technology to be carried out in the insurance industry The committee emphasized that in
order to improve the customer services and increase the coverage of the insurance industry
should be opened up to competition.

But at the same time, the committee felt the need to exercise caution as any failure on the part
of new players could ruin the public confidence in the industry. Hence, it was decided to
allow competition in a limited way by stipulating the minimum capital requirement of Rs.100
crores. The committee felt the need to provide greater autonomy to insurance companies in
order to improve their performance and enable them to act as independent companies with
economic motives. For this purpose, it had proposed setting up an independent regulatory
body.

WHAT IS INSURANCE?

Insurance is a contract that provides compensation for specific losses in exchange

for a periodic payment. An individual contract is known as an insurance policy and
the periodic payment is known as the insurance premium. Insurance provides a
mechanism for shifting risk from a person, business, or organization to an insurance
company in exchange for the payment of the insurance premium.

There are many types of insurance and our guide provides information about the
most common types. The most important ones for most individuals are health
insurance, life insurance, and auto insurance. Health insurance provides protection
against sickness and bodily injury. Auto insurance provides can pay for injuries or
damage resulting from an auto accident or when an auto is vandalized or stolen. Life
insurance makes a payment to your beneficiaries in the event of your death.

Life insurance pays a specified sum to the beneficiaries upon the death of the insured. It is
generally used to provide cash to your family in the event of your death. There are several
types of life insurance policies. The most common types are whole life insurance and term
life insurance. Whole life insurance provides a lifetime of protection as long as you pay the
premiums to keep the policy active.

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They also accrue a cash value and thus offer a savings component. Term life insurance
provides protection only during the term of the policy and the policies are usually renewable
at the end of the term.

1.2. GLOBAL SCENARIO:

Globally, the insurance industry experienced strong premium growth in 2015, at 5.6 percent,
whereas growth in 2016 is expected to be noticeably slower, at 4.4 percent. Total premiums
are expected to reach €4.6 trillion, up from €4.4 trillion in 2015. What factors help explain
the industry’s performance? The global insurance industry is undergoing turbulent times
with the continuing low interest rate environment, a challenging equity market, and
tightening regulatory changes, such as the US Department of Labor (DOL) rule and new US
tax guidelines. Meanwhile, consumers’ shift to hybrid online and offline research and
purchasing has largely concluded in developed markets and is accelerating in developing
markets with the spread of mobile phones. These changes, along with the impact of price-
comparison websites and other technology developments, plus the race to implement digital
processes, are tectonic shifts forcing insurers to adjust their business models. Mature markets
in North America and Western Europe required the deployment of considerable strength to
address these trends. With life eroding and P&C flattening, the mature markets have
exhibited slower growth rates than insurance in emerging markets, and the figures in our
report are beginning to reflect these major fault lines by business segment and geography.
Specifically, preliminary reports at the segment level globally suggest that health had the
highest growth rate from 2015 to 2016, at 6 percent followed by P&C at 4.2 percent, while
life saw a slowdown in growth of gross written premiums (GWP) from 4.8 percent in 2015
to 3.8 percent in 2016. At the regional level, EMEA recorded moderate growth in the P&C
and health insurance segments, while life is expected to decline. Growth in the Americas
region has been characterized by strong progress in health and moderate growth in the P&C
segment. Life is expected to be a bit volatile, owing to changes in US regulations, and is
projected to end 2016 with a slight decline in the Americas overall. In APAC, on the other
hand, the insurance industry grew in all three segments, with health generating double-digit
growth.

At the business segment level, preliminary reports revealed some important trends:
1. LIFE : Most regions, except the Americas and Western Europe, saw positive life growth in
2016, but the amount of the increase, as well as the factors responsible, varied by region. In a
marked departure from 2015, Asian countries, such as China, Hong Kong (analyzed as a
separate entity), and India, achieved the strongest gains. Of all life products, endowments
experienced the most growth, mainly driven by emerging Asia and the United States, whereas
Unit-linked (UL) products have seen a decrease in the United States and Western Europe. The
key profit indicator—life return on equity (RoE)—rose from 11 percent in 2014 to 11.8
percent in 2015, but is expected to stabilize at the lower level of 10 percent going forward.

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2. P&C. The global P&C insurance industry has remained stable over the past five years,
growing at a steady 4 to 5 percent. It is also expected to grow at 4.2 percent for the year 2016,
increasing the size of the global P&C market to €1.39 trillion. At the regional level, although
the APAC region accounts for only 23 percent of the total P&C market, it has been the major
driver of growth, growing at an average rate of 9 percent per annum (p.a.) since 2013, and is
expected to grow even faster in the future. In contrast, the Americas and the EMEA regions,
accounting for 49 percent and 29 percent of the global market, respectively, are expected to
grow at a scant 2 to 3 percent over the next two years. Longer term, we believe P&C will see
declining if not negative growth, at least in mature markets, due to, for example, safer and
fewer cars and more technology for risk prevention in homes and factories. Our prediction
suggests a further shift of growth to Asia and emerging markets lies ahead. The overall
combined ratio of the P&C insurance industry has remained stable with a slight improvement
in the claims ratio being offset by higher operational costs. The combined ratio is expected to
remain stable with improvements in the expense ratio of up to 1 percent. Emerging markets
have proved to be more profitable for the P&C insurance industry, reporting a claims ratio
three to four percentage points lower than in mature markets across different lines of
business. Accident proved to be the most profitable line over the last decade, with fire and
property reported as the most profitable in 2015.

3. Health. In the health insurance market, the global annual growth rate decreased from 9
percent in the 2014–15 period to 6 percent and 7 percent in subsequent years. The US
continues to be the biggest contributor to the absolute growth of health premiums globally,
driven by the expansion of coverage implemented with the Affordable Care Act. The fastest-
growing regional market overall is APAC, mainly fueled by the efforts of companies in
China and India to increase health insurance penetration, with China focusing on its aging
population and India on its rural population. Net profit margins in APAC are also the highest
globally, led by smaller markets such as Hong Kong and Singapore.

Geographic view of recent developments in the global insurance industry

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Fig: 1.2 the global insurance industry backed by APAC

In 2016, insurance premiums worldwide continued growing at a stable rate, 4.4 percent
for the 2010–15 time frame, just as 4.4 percent for 2010 to 2015

1. The industry’s strong performance primarily stems from growth in health,

which experienced 6.0 percent growth in 2016, still down from 9.0 percent
in 2015.
2. In parallel, life growth slightly decreased from a rate of 4.8 percent in 2015 to 3.8
percent in 2016.
3. P&C premiums growth saw a slight decrease from 4.4 percent in 2015 to 4.2
percent in 2016.

:
1.2. INDIAN SCENARIO

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Life Insurance in its existing form came to India from the United Kingdom with the
establishment of a British firm Oriental Life Insurance Company in Calcutta in 1818
followed by Bombay Life Assurance Company in 1823.

The Indian Life Assurance Companies Act, 1912 was the first statutory measure to regulate
life insurance business. Later in 1928 the Indian Insurance Companies Act was enacted to
enable the Government to collect statistical information about both life and non-life insurance
business transacted in India by Indian and foreign insurers including provident insurance
societies. In 1938 with a view to protecting the interest of insuring public earlier legislation
was consolidated and amended by the Insurance Act 1938 with comprehensive provisions
detailed and effective control over the activities of insurers.

The Act was amended in 1950 resulting in far reaching changes in the insurance sector. These
included a statutory requirement of equity capital for companies carrying on life insurance
business, ceiling on share holdings in such companies, stricter control on investments,
submission of periodical returns relating to investments and such other information to the
controller. The controller could also call for appointment of administrators and put a ceiling
on expenses of management and agency commission for mismanaged companies.

By 1956, 154 Indian insurers, 16 foreign insurers and 75 provident societies were carrying on
life insurance business in India. Life insurance business was concentrated in urban areas and
confined to the higher strata of the society. On January 19, 1956, the management of life
insurance business of 245 Indian and foreign insurers and provident societies then operating
in India was taken over by the Central Government. ‘Life Insurance Corporation’ was formed
in September 1956 by an Act of Parliament, viz. LIC Act 1956 with a capital contribution of
Rs.50 mn.

The then Finance Minister Mr. C. D. Deshmukh while piloting the bill for nationalization
outlined the objectives of LIC thus:

"To conduct the business with utmost economy with the spirit of trusteeship; to charge
premium no higher than warranted by strict actuarial considerations; to invest the funds for
obtaining maximum yield for the policy holders consistent with safety of capital; to render
prompt and efficient service to policy holders thereby making Insurance widely popular."

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Since 1956, with the nationalization of insurance industry, the state-run Life Insurance
Corporation of India (LIC) has held the monopoly in that country's life insurance sector.
General Insurance Corporation of India (GIC), with its four subsidiaries, was its counterpart
in the casualty sector. Over time, taking advantage of its monopoly and virtual prerogative in
establishing premiums, LIC has evolved into a monolith. With around 600,000 agents in
every nook and corner of the vast country, it has created an enviable brand name, particularly
among the rural population of the country. It has around $40 billion as its life fund and is a
strong player in the financial sector. With a huge unionized, rigid workforce mostly in the
clerical category, LIC runs the risk of high fixed cost, which will be the deciding factor in
productivity in the competitive scenario. The new players, with the state-of-the-art
technology under their belt, will be in an advantageous position. 80% of LIC's business is
procured by 20% of its ill-trained agent force.

The well-publicized failures of world famous consumer goods companies like Electrolux,
Whirlpool, Reebok, Nike etc. to gauge the Indian psyche and sentiments demonstrate the
concept. They failed in the areas of realistic pricing, product promotion and reaching to the
consumer. The foreign companies need to know the "ground realities" to the details. Today
the Life Insurance Corporation of India has 2046 branches. It is made up of 100 divisions,
which are divided, into 7 zones. There are 558,000 LIC agents in the country.

CURRENT STATUS:

The IRDA bill had been introduced in the Lok Sabha during the Vajpayee government’s last
tenure with the expected mixed reactions. Surprisingly, the Congress chose to keep mum on
the issue. The left parties staged a walkout registering strong protest. While the eager
international and domestic players have to continue waiting in the wings for the curtains to
rise, the government has made another landmark announcement. It is expected to be
introduced again during the ongoing winter session of the parliament The Banking
Regulation Act is to be modified to allow banks to become active players in the insurance
sector. This comes as a major move and a precursor to the sweeping insurance reforms that
have been opposed by the swadeshi bandwagon and the various labour unions operating in
the insurance sector.

The takeout of the amendment made to Section 6 (0) of the Banking Regulation Act, 1949 is
this: The current act does not permit banks to handle insurance products. The proposed

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change will permit banks to either distribute or to market insurance products. In addition to
this, banks will also be allowed entry to the insurance sector through the joint venture route
and bank assurance. It is understood that only strong banks with three-year track records will
be allowed to enter the business - entry is a strict no-no to the weaker banks. The Insurance
Regulatory and Development Authority (IRDA) Bill provides for three levels of players - An
Insurance Company, Insurance Broker and an Agent. Banks will work as agents and brokers
in this proposed structure.

This is an attempt to make the insurance sector more dynamic - this is likely to happen as
banks will use their formidable branch network to market and distribute the insurance
products. This amendment could also forge alliances in the banking sector. Initial reports
indicate that the State Bank of India and Bank of Baroda have expressed interest in entering
into joint ventures. ING Barings, who already has a 20%, stake in Vysya Bank, plans to broad
base its alliance to add on insurance-based activities.

This could be a timely move - one that will allow the domestic players to prepare for the
competition ahead. It would also bring them on par with international players who are
accustomed to operate in a liberalized environment. This is also a sensible move by the
government to allay the fears of its more conservative and swadeshi-oriented allies and
cement cracks, if any have appeared, given the BJP's new pro-liberalization avataar.

A closer look at the amendment indicates that it is tantamount to creating stronger public
sector monopolies with behemoths like SBI and BOB entering the fray. It is unlikely that the
private sector banks would contemplate entering the business, as they may not have the
requisite capital to meet the prescribed capital adequacy for the insurance sector. The
government may have made a move that could be counter-productive in that the protests
against entry of foreign players will only get more vociferous and strong with many more
strong arms entering the rally.

The manner and style of operations of the public sector banks leaves a lot to be desired. In an
industry where service quality at the moment of truth or the moment of service delivery is
non-existent for the public sector players, one wonders what vibrancy these players will
impart to the insurance business. The insurance agent as stereotyped currently is but the
personification of a nationalized bank. Any marketing professional and every consumer will

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describe such a person as a semi-retired, balding, sloppy individual who drags his feet as he
walks.

One shudders to even conjure up images of insurance marketing in a nationalized bank

branch. One has to search for a semblance of marketing in the existing set-up for student
loans and housing finance. Business school aspirants and young couples will bear witness to
this fact. I have recently been both and have strained my eyes searching for the proverbial
needle in a haystack.

1.3. INDUSTRY STRUCTURE:

By 2012 Indian Insurance is a US$72 billion industry. However, only two million people
(0.2% of the total population of 1 billion) are covered under Mediclaim. With more
and more private companies in the sector, this situation is expected to change. ECGC,
ESIC and AIC provide insurance services for niche markets. So, their scope is limited
by legislation but enjoy some special powers. The majority of Western Countries
have state run medical systems so have less need for medical insurance. In the UK, for
example, the corporate cover of employees, when added to the individual purchase of
coverage gives approximately 11– 12% of the population on cover - due largely to
usage of the state financed National Health Service (NHS), whereas in developed
nations with a more limited state system, like USA, about 75% of the total population
are covered under some insurance scheme.

1.4. industry outlet

Introduction
The insurance industry of India has 57 insurance companies - 24 are in the life
insurance business, while 33 are non-life insurers. Among the life insurers, Life
Insurance Corporation (LIC) is the sole public sector company. There are six public
sector insurers in the non-life insurance segment. In addition to these, there is a sole
national re-insurer, namely General Insurance Corporation of India (GIC Re). Other
stakeholders in the Indian Insurance market include agents (individual and
corporate), brokers, surveyors and third-party administrators servicing health
insurance claims.

Market Size
Government's policy of insuring the uninsured has gradually pushed insurance
penetration in the country and proliferation of insurance schemes.
Gross premium collected by life insurance companies in India increased from Rs
2.56 trillion (US$ 39.7 billion) in FY12 to Rs 7.31 trillion (US$ 94.7 billion) in FY20.
During FY12–FY20, premium from new business of life insurance companies in India
increased at a CAGR of 15 per cent to reach Rs 2.13 trillion (US$ 37 billion) in FY20.

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Overall insurance penetration (premiums as per cent of GDP) in India reached 3.69
per cent in 2017 from 2.71 per cent in 2001.
The market share of private sector companies in the non-life insurance market rose
from 15 per cent in FY04 to 56 per cent in FY21 (till April 2020). In life insurance
segment, private players had a market share of 31.3 per cent in new business in
FY20.

Investments and Recent Developments

The following are some of the major investments and developments in the Indian
insurance sector.

• Enrolments under the Pradhan Mantri Suraksha Bima Yojana

(PMSBY) reached 154.7 million till December 2019 since its launch.
• Over 53.8 million famers were benefitted by the Pradhan Mantri Fasal Bima
Yojana (PMFBY) in FY20.
• In April 2020, Axis Bank acquired an additional 29 per cent stake in Max
Life Insurance.
• In November 2019, Airtel partnered with Bharti AXA Life to launch prepaid
bundle with insurance cover.
• In September 2019, Competition Commission of India (CCI) approved
acquisition of shares in SBI General Insurance by Napean Opportunities
LLP and Honey Wheat.

Government Initiatives

The Government of India has taken number of initiatives to boost the insurance
industry. Some of them are as follows:

• As per Union Budget 2019-20, 100 per cent foreign direct investment
(FDI) was permitted for insurance intermediaries.
• In September 2018, National Health Protection Scheme was launched under
Ayushman Bharat to provide coverage of up to Rs 500,000 (US$ 7,723) to
more than 100 million vulnerable families. The scheme is expected to
increase penetration of health insurance in India from 34 per cent to 50 per
cent.
• The Insurance Regulatory and Development Authority of India (IRDAI) plans
to issue redesigned initial public offering (IPO) guidelines for insurance
companies in India, which are to looking to divest equity through the IPO
route.
• IRDAI has allowed insurers to invest up to 10 per cent in additional tier 1
(AT1) bonds that are issued by banks to augment their tier 1 capital, in order
to expand the pool of eligible investors for the banks.

Road Ahead
The future looks promising for the life insurance industry with several changes in
regulatory framework which will lead to further change in the way the industry
conducts its business and engages with its customers.

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The overall insurance industry is expected to reach US$ 280 billion by 2020. Life
insurance industry in the country is expected to increase by 14-15 per cent annually
for the next three to five years.
Demographic factors such as growing middle class, young insurable population and
growing awareness of the need for protection and retirement planning will support
the growth of Indian life insurance.

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CHAPTER : 2 COMPANY OVERVIEW

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2.1. company overview:

Shriram Group is an Indian conglomerate founded on 5 April 1974 by Ramamurthy

Thyagarajan, AVS Raja and T. Jayaraman. They have their headquarters in Chennai, Tamil
Nadu, India. The group had its beginning in chit funds business and later on entered the
lending business through Shriram Transport Finance (Commercial Vehicle Finance) and
Shriram City Union Finance (Consumer and MSME Finance). In 2018, the company forayed
into metallurgy by setting up a unit in Odisha.

The Shriram group is one of the largest and well respected financial services conglomerats in
India. The group’s main line of activities in financial services include, chit funds, truck
financing, consumer durable financing, stock broking, insurance broking, and life insurance.
The group has a customer base of 30 lack chit subscribers and investors and operates through
a network of 630 offices all over the country. The group has the largest agency force in the
privet sector consisting of more than 75000 loyal and dedicated agents.

Shriram Life insurance Co Ltd. was launched in January 2006. India currently accounts for
16% of the world’s population. 70% of the populations is below 35 years of age. Between
2001 and 2006, Indian demography has changed with the higher income classes constituting
about 79%. This presents huge market for insurance products.

This is amply reflected in the growth of insurance industry in the last recent years. However
this growth has not reached to rural and semi urban areas. Shriram group with its network of
branches particularly in these areas a unique opportunity for reaching out a wider audience
and sustain the growth story of the insurance industry. Most of the products of Shriram life
were designed by advisors working in the field and based on need analysis done through
intense market research.

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During the first year of operation the company earned a profit of 2 crores which doubled to 4
crores in the subsequent year. For the fiscal ended march 2009 the company earned a profit of
8 crores adding the total premium at the end of 2008-09 stood at 1000 crores. The company
aims to garner new business premium of Rs 1000 crores in the next 3-4 years. The company
also intends to increase in 100 cities in next couple of years.

JOINT VENTURES:
Shriram Life Insurance Company Ltd is a joint venture of Shriram group and Sanlam with
South Africa holding 26% of the stack.

Sanlam Life insurance Limited, a part of the Sanlam Group, is one of the largest providers of
life insurance in South Africa with 3.2 million individuals policies under administration

It has a significance presence across South Africa, United Kingdom and Namibia and is a
major provider of life insurance, retirement annuities, saving and investment products,
personal loans, home loans and trust services to individuals. The shareholder's funds of
Sanlam Life equates to USD 4.4 billion

The Sanlam Group was established in 1918 and has a leadership position in financial services
in South Africa. Demutualized in 1998, the group is listed on the JSE Securities Exchange in
Johannesburg and on the Namibian Stock Exchange. It has a current market capitalization of
USD 5.4 billion. The Sanlam Group also operates in the areas of group schemes, retirement
funds, short-term insurance, asset management and other financial services. It has employee
strength of 8,000 and has shareholder funds in excess of USD 4.6 billion. On 31st December
2004 it had more than USD 48 billion assets under management

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VISION:

The Shriram Life Insurance Company is set out with the objective of reaching out to the
common man with a host of products and services that would be helpful to him in his path to
prosperity.

Efficiency in operations, integrity and a strong focus on catering to the needs of the common
man, by offering him high quality and cost-effective products and services, are the values
driving the organization. These core values are deep-rooted within the organization and have
been strongly adhered to over the decades.

The company prides itself on its perfect understanding of the customer. Each product or
service is tailor-made to perfectly suit the needs of the customer. It is this guiding philosophy
of putting people first that has brought the Company closer to the grassroots and has made it
the preferred choice for all the truck financing requirements amongst the customers

Highlights of Shriram Life Insurance

Some of the notable achievements of the company are as follows –

1. The company has won the Indian Insurance Award for offering Non-
urban coverage in the life insurance segment
2. In the private life insurance sector, the company has also won the
award for the best life insurance policy
3. The company’s mission is to offer cost-effective insurance solutions to all
individuals of the country
4. Shriram Life Insurance offers a range of life insurance plans. each plan
has attractive coverage benefits and an affordable premium rate

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2.2.Financial performance:
Directors report
Dear Shareholders, Your Directors have pleasure in presenting the Fourteenth Annual Report
together with the audited Financial Statements, Management Report and the Auditors’ Report
thereon for the Financial Year ended 31st March 2019.

FINANCIAL AND OPERATIONAL REVIEW:

Highlights of the financial results of your Company for the year ended 31st March, 2019 are
summarized below:-

particulars For the year ended For the year ended

31st march 2019 31st march 2018
Number of new policies 276483 247183
(Including Group)
Premium Income: (` in Crores) 1699 1497
- New Business Premium 813 810
- Renewal Premium 886 687
Sum Assured in force (` in 106456 96070
Crores)
Funds under Management 4196 3544
(including Share holders’ Funds)
(` in Crores)
Expense ratio # 31% 34%
sales and distribution strength :
Geographical Spread (No. of 588 609
Offices)
Number of Insurance Agents 4455 4498
Profit Before Tax (` in Crores) 55 93
Profit After Tax (` in Crores) 63 88
Cumulative Profits (` in Crores) 447 406
Share Capital (` in Crores) 179 179

# Expense ratio = All expenses (commission + operating expenses)/ Premium income The results
in the Non Linked business was a surplus of ` 106.95 Crores after tax (Previous year: surplus of
`47.25 Crores); the results in the linked business was a surplus of ` 10.60 Crores. (Previous year:
` 10.25 Crores). The Profit & Loss Account (Shareholders’ account) showed a profit of ` 63
Crores after tax which includes transfer from Policyholders’ Account of ` 112 Crores (for the
previous year the profit was ` 87.88 Crores after transfer of ` 58.60 Crores from Policyholders’
Account).

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BUSINESS PERFORMANCE

The domestic life insurance industry registered 11% growth for new business premium in
financial year 2018-19, largely driven by growth in Individual premium policy. While private
insurers saw their growth at 22 %, state - run Life Insurance Corporation of India (LIC)
registered growth at 6 % in last financial year.

On Individual New Business, your Company saw a growth of around 9% as compared to 16%
growth for private industry and 1% de-growth for LIC. On Individual APE, your Company
grew from ` 425 Crores to ` 452 Crores, a growth of 6%, as compared to 12% growth for Private
Industry & 5% growth for LIC. The total premium income of the company was ` 1699 Crores
(Previous Year ` 1497 Crores).

(* Annualized Premium Equivalent (APE) is a measure of new business activity that is

calculated as the sum of annualized regular premium from the new business plus ten
percentage of single premiums from the new business written during the period. )

Your Company has incurred operating expenses of ` 413.34 Crores (Previous Year ` 381.41 Crores).
The Board and the Management are closely monitoring the operating expenses.

AUDITORS

M/s. G.D. Apte & Co., Chartered Accountants and M/s M Bhaskara Rao & Co, Chartered
Accountants are the Joint Statutory Auditors of the Company.

M/s. G.D. Apte & Co. Chartered Accountants were appointed as Joint Statutory Auditors of
the Company at the 12th Annual General Meeting held on 14th July, 2017 and M/s M.
Bhaskara Rao & Co, Chartered Accountants were appointed as Joint Statutory Auditors of the
Company at the 13th Annual General Meeting held on 23rd July, 2018. Pursuant to the
Notification issued by the Ministry of Corporate Affairs on 7th May, 2018 amending section 139 of
the Companies Act, 2013 (“Act”) and the Rules framed thereunder, the mandatory requirement for
ratification of appointment of Auditors by the Members at every Annual General Meeting
(“AGM”) has been omitted, and hence the Company is proposing an item on ratification of
appointment of Auditors at this AGM till the conclusion of 17th and 18th AGM respectively so
as to do away with the requirement of ratification every year in terms of their original
appointment resolution. Henceforth, keeping in view the requirements set out in the Act, the
Company will not propose an item on ratification of appointment of Auditors in the
shareholder meetings.
The Company has sent a letter seeking the consent and the certificate of eligibility from
M/s Bhaskara Rao & Co for the appointment and from M/s G D Apte & Co for consent and
eligibility for the ratification of their appointment. The same was received from them.

The Auditors have not made any qualification, reservation or adverse remark or disclaimer in their
Report for FY 2018-19.

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REVENUE ACCOUNT

FORM A-RA

Name of the Insurer : Shriram Life Insurance Company Limited Registration No. and Date of
Registration with IRDAI :128 dated 17th November 2005 REVENUE ACCOUNT FOR THE YEAR
ENDED 31st MARCH, 2019 POLICYHOLDERS’ ACCOUNT (Technical Account)

particulars sche Year ended Year ended

dule 31st march 31st march
2019 2018
Premiums Earned - Net
(a)Premium 1 16994624 14970366
(b) Reinsurance ceded (c) Reinsurance accepted (4 70 78) (3 18 28)
Sub-total 1694 75 46 1493 85 38
Income From Investments
(a) Interest, Dividend & Rent - Gross 2170065 1797025
(b) Profit on sale / redemption of investments 1198440 897799
(c) (Loss on sale / redemption of investments)
(d) Transfer/Gain revaluation/change in Fair
(256588) (44050)
value - -
(e) Unrealised Gains (522588) (608708
(f) Amortisation of (premium)/discount on 25683 (19491)
investments
Other Income
1182 (20937)
(a) Contribution from the Shareholders’ a/c
(b) Other Income 46712 86894
Sub-total 2662906 2130405
TOTAL(A) 19610452 17068943
Commission 2 1059321 929857
Operating Expenses related to Insurance 3 4133438 3814133
Business
Service Tax / GST on Ulip Charges 30806 35477
Provision for Doubtful Debts
Bad Debts Written Off
Provision for Tax 339985 248801
Provisions (other than taxation) 150000 -
(a) For diminution in the value of investments - -
(net)
(b) Others
TOTAL(B) 5713550 5028268
Benefit Paid (Net) 5706485 5685631
Interim Bonuses Paid 4 3503 3345
Change in valuation of liability in respect of life
policies 7010276 5755767
(a) Gross **
- -
(b) (Amount ceded in Re-insurance)
(c)Amount accepted in Re-insurance
- -
TOTAL(C) 12720264 11444743
SURPLUS/ (DEFICIT ) (D) = (A) - (B) - (C) 1176639 595932

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(Deficit)/Surplus at the beginning of the year 23212 13260

Surplus available for appropriation 1199851 609192
APPROPRIATIONS
Transfer to Shareholders’ Account Transfer to 1118219 585980
Other
Reserves - - Balance being Funds for
- -
future Appropriations 81632 23212
TOTAL(D) 1199851 609192

FORM A-BS

Name of the Insurer : Shriram Life Insurance Company Limited

Registration No and Date of Registration with IRDAI :128 dated 17th November

2005

BALANCE SHEET AS AT 31st MARCH, 2019

particulars schedul As at As at
e 31st march 2019 31st march 2018
SOURCES OF FUNDS SHAREHOLDERS’
FUNDS: Share Capital Reserves 5 1753060 1750944
and Surplus Credit/(Debit)/ Fair 6 4468164 4058834
Value Change Account 153678 67450
Sub total 6374903 5877228
Borrowings 7 - -
Deferred Tax Liability - -
POLICYHOLDERS’ FUNDS: 141914 395479
Credit/(Debit)/ Fair Value 32695374 24638619
Change Account - -
Policy Liabilities
Insurance Reserves 5155397 6087231
Provision for Linked Liabilities
Funds for discontinued
-
policies
(i) Discontinued on account
138617 236731
of non-payment of - -
premium
(ii) (ii) Others
Sub total 38131302 31358074
FUNDS FOR FUTURE 81632 23212
APPROPRIATIONS
TOTAL 44587837 37258515
APPLICATION OF FUNDS
INVESTMENTS
Shareholders’ 8 5634593 5395190
Policyholders’ 8A 30965886 23717983
Assets Held to Cover Linked Liabilities
8B 5294014 6323977
Loans
Fixed Assets
9 223353 96819
Current Assets 10 640897 406339
Cash and Bank balances 11 1464749 2001724
Advances and Other Assets 12 2914221 2485861
Sub total(11+12)(A) 4378970 4487585
Current Liabilities 13 2374494 3043571
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Provisions 14 175381 125809

Sub total (13+14) 2549875 3169380
(B)
NET CURRENT ASSET (C) = (A-B) 1829095 1318205
Miscellaneous Expenditure 15 - -
(To the extent not written off
or Adjusted
Debit Balance In Profit & Loss
Account (Shareholders’ Account ) - -
DEFICIT IN THE REVENUE ACCOUNT - -
(Policyholders’ A/c)
TOTAL 44587837 37258515

2.3. PRODUCTS

Broadly, insurance plans can be distinctly divided into ULIPs and traditional plans. A brief
detail of both segments:
Unit Linked Insurance Products

ULIPs have gained high acceptance due to attractive features they offer. These include:

1. Flexibility
1. Flexibility to choose Sum Assured.
2. Flexibility to choose premium amount.
3. Option to change level of Premium /Sum Assured even after the plan has started.
4. Flexibility to change asset allocation by switching between funds
2. Transparency
1. Charges in the plan & net amount invested are known to the customer
2. Convenience of tracking one’s investment performance on a daily basis.

3. Liquidity
1. Option to withdraw money after few years (comfort required in case of
exigency)
2. Low minimum tenure.
3. Partial / Systematic withdrawal allowed
4. Fund Options
1. A choice of funds (ranging from equity, debt, cash or a combination)
2. Option to choose your fund mix based on desired asset allocation

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ULIP Plans:

1. Future Wealth 2,

2. Pension Plan 2,

3. Shri Plus 2,

4. Shri Vidya Plus 2,

5. Shri Vikas 2,

6. Shri Vishram 2.

TRADITIONAL PLANS

These are the oldest types of plans available. These plans cater to customers with a low risk
appetite. Some of the common features of traditional plans are:

1. Steady Investment
1. Major chunk of investible funds are in debt instruments
2. Steady and almost assured returns over the long term
2. Features
1. Death benefit is Sum Assured + guaranteed & vested bonus
2. Helps in asset creation as they are for a long tenure
3. Premium to Sum Assured ratios are fixed for each plan and age.
4. Generally withdrawals are not allowed before maturity

1. Shri Laabh,

2. Shri Life,

3. Shri Raksha,

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4. Akshya Nidhi,

5. Shri Surksha,

6. Shri Vidya,

7. Shri Vivah

2.4. SWOT ANALYSIS:

Fig : 2.4 SWOT analysis

Strength:

• Quality of products
• Quality of services
• Highly cooperative and efficient staff & crew members
• Wide distribution network across the whole country.

Weakness:

• Less promotional activities

• Less advertising efforts
• Low market share compared to PSUs

Opportunities:

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• By making some good promotional efforts Shriram can gain more number of
customers who will be loyal.
• Increasing awareness will result in increase in customer base.
• Company has already proved it’s strength in market so, soft work required to
launch this product
• Huge potential of insurance business in India.

Threats:

• Challenges posed by other competitor in the market.

• Lower customer base may hinder prompt service
• Social scenario.
• Government policies
• Aggressive Marketing strategy by competitors

2.5. OVERVIEW OF DIFFERENT DEPARTMENTS:

FUNCTIONAL DEPARTMENTS

FINANCE DEPARTMENTS

Something must be direct the how of economic activity and facilities its smooth operation.
Finance is the agent that produces this result. Nature of financial management refers to its
functions, scope and objectives.

Financial management is that managerial activity which is concerned with the planning and
controlling of the firm’s financial resources. In modern times finance is the life-blood of the
business. No matter, whether the business is big or small financial is the equally important.
The financial resources must proper planned and control in order to achieve the best out of
available. So, financial resources should be very properly

Generally, financial planning means deciding in advance, the financial activities are to be
carried on to achieve the objective of the firm. In broader séance, in the words of Walker and

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Boughn as; “financial planning includes the determination of firm’s financial objectives,
formulating and promulgating financial polices and developing and procedures.”

Financial planning is necessary to achieve both long term and short term objectives. A sound
financial planning includes how much need of funds for both the terms. Then from where
they are to be received and utilized.

Shriram life would evaluated different proposal placed before them and selects the best out of
them. It estimates how much capital is going to be required for various proposals and how
much is the return on the capital employed. The financial manager lays down the estimate on
the capital of cash per week, per month and per year.

CAPITALIZATION
At the time of incorporation of any business, it is the first problem before the promoters to
decide how much capitalization should be made in a business. The amount of capital of any
time should not exceed nor less than the amount required. So, it is necessary to have proper
capitalization for the success of the enterprise. But Gerstenberg defines it as;

“The total accounting value of all capital regularly employed in business, it includes
owner’s capital, borrowed capital and any other sources.”

Thus term includes;

1. The value of ordinary and preference shares

2. The value of all surplus earned and capital
3. The value of bonds and security still not redeemed
4. The value of long term loans
However the modern view includes short term funds or liabilities under the firm. It
should be properly capitalized.

Shriram Life Insurance issue shares. So, all these terms do apply.

FUND OPTIONS
There are six funds having different proportional investment in equity, debt, market
money and cash. The funds are Preserver, Defender, Balancer, Maximus, Accelerator, and
Tyaseer.

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MARKETING DEPARTMENT
Traditionally, insurance products have been promoted and sold principally through agency
systems in most countries. With new developments in consumer behaviour, evolution of
technology and deregulation, new distribution channels have been developed successfully
and rapidly in recent years.

Shriram Life Insurance make use of various distribution channels:

▪ Career Agents
▪ Advertisements
▪ Direct Response
▪ Internet

The main characteristics of each of these channels are:

➢ Career Agents: Career Agents are full-time commissioned sales personnel holding an
agency contract. They are generally considered to be independent contractors.
Consequently an insurance company can exercise control only over the activities of
the agent, which are specified in his contract. Despite this limitation on control, career
agents with suitable training, supervision and motivation can be highly productive and
cost effective. Moreover their level of customer service is usually very high due to the
renewal commissions, policy persistency bonuses, or other customer service-related
awards paid to them.
Many insurance companies, however avoid this channel, believing that agents might
oversell out of their interest in quantity and not quality. Such problems with career
agents usually arise, not due to the nature of this channel, but rather due to the use of
improperly designed remuneration and/or incentive packages.

➢ Direct Response: In this channel no salesperson visits the customer to induce a sale
and no face-to-face contact between consumer and seller occurs. The consumer
purchases products directly by responding to the company's advertisement, mailing or

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telephone offers. This channel can be used for simple packaged products, which can
be easily understood by the consumer without explanation.

 Advertisements: This very popular medium among the entire medium any person
can see this advertisement of the products and buy the product from nearest
branch.
Internet: Internet banking is already securely established as an effective and
profitable basis for conducting banking operations. The reasonable expectation is that
personal banking services will increasingly be delivered by Internet banking.
Company can also feel confident that Internet banking will also prove an efficient
vehicle for cross selling of insurance savings and protection products. It seems likely
that a growing proportion of the affluent population.

HUMAN RESOURCE DEPARTMENT

“Human Resource Management function that helps managers recruits select, train and
develop members for an organization. Obviously, HRM is concerned with the people’s
dimension in organizations

In all business concerns, there is one common element. i.e. HUMAN RESOURCE. Work
force of an Organization is one of the most important inputs of components. It is said that
people are our single most important assets. Because of the unique importance of HUMAN
RESOURCE and its complexity due to ever changing psychology, behavior and attitudes of
men and women at work, personnel function, i.e., manpower management function is
becoming increasingly specialized. The personnel function or system can be broadly defined
as the management of people at work- management of managers and management of
workers. Personnel function is particularly interested in personnel relationship and interaction
of employees-human relations.

In a sense, management is personnel administration. Management is the development of

people, and not mere direction of material resources. Human capital is the greatest asset of a
business enterprise. The essential ingredient of management is the leadership and direction of

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people. Each manager of people has to be his own personnel man. Personnel management is
not something you really turn over to personnel department staff.

MANPOWER PLANNING

Human Resource Planning is the process by which an organization ensures that it has the
right number and kind of people, at the right place, at the right time, capable of effectively
and efficiently competing those tasks that will help the organization achieve its overall
objectives. Human Resource Planning translates the organization’s objectives and plans into
the number of workers meet those objectives. Without a clear-cut planning, estimation of an
organization’s human resource need is reduced to mere guesswork

Manpower planning is needed with respect to persons who can work as sub-broker for the
companies. Companies focus on Advisors of Mutual Fund product and ELSS schemes of
Shriram and focused on Insurance Advisor and post office agent, Tax consultants and CAs
for making sub-broker.

Shriram Life Insurance follows the following process:

The first step is forecasting the need of man power in terms of divisions, department or
functions. Along with the estimate of the number of the people required in different
departments it is also decided that at which level they will be needed.

After estimating the man power requirement, next step is to have a look at the current human
resource. The current human resource is assessed so as to know whether the requirement can
be filled by the existing personnel or not.

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At last detailed policies for recruitment, selection, training, promotion, retirement,

replacement etc.

EXCLUSIVE EMPLOYMENT
The employee position is that of full time employed with Shriram Life. The company
strictly prohibits the employees from seeking employment of any nature with any other
entity.

The employees have to take prior approval from the superior and the Human Resource
department before engaging in activities like addressing seminars, teaching etc. and ensure
that these official duties do not suffer on this account and no monetary benefit is derived
there from.

The employee or its relatives should also not be empanelled as an authorized / unauthorized
distributor / agent / broker or in any other similar capacity of any entity engaged in
distribution and selling of financial products.

RECRUITMENT & SELECTION

The upper level members like zonal managers, regional managers, branch managers and
senior executives are recruited by publishing recruitment advertisement in leading national
level newspaper. The qualified applicant are then called for interview and selected.

The regional manager has authority to select lower level employee like peon, marketing
executives, financial accountant etc. by approval of zonal manager.

PERFORMANCE APPRAISAL
Objective of Performance appraisal if for Developmental uses for agents and financial
consultants, for wages, transfer, promotion, for documentation and for organizational purpose
like Human Resource Planning, Job analysis and for training and development.

TRAINING
Continuous training and upgrading technical, behavioral and managerial skills is a way of life
in Shriram. Shriram Life encourages agent or sub-broker to hone their skills regularly to

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enable them to face the challenges of the changing requirements of customers that fit market
up and down

The successful candidates of the AMFI Exam are given the product training. The primary
purpose is to become quite conversant with the product that one sells. In other words, product
knowledge is very important for any advisor. Product knowledge is not just about knowing
the broad terms and conditions of the various schemes of policies. The advisors are explained
about the schemes, the terms related with it, the benefits it provides to investor. This training
is aimed at making the advisors fully equipped with the companies’ product information. This
training is aimed at making the advisors experts in selling the products

2.6 Future Outlook

We remain cautious in the short term. The virus is spreading to
smaller towns where healthcare infrastructure is challenged. With
announcement of localized lockdowns uncertainty for business
operations increases. Nifty has rallied ahead of expectations as
many sectors are near or higher than pre-Covid level.
Additionally, huge supply of equity either through capital raise or
Private Equity exits is being witnessed.
However, we remain positive in our medium term view as global
central banks and governments have announced liquidity and
fiscal measures to buffer the impact from slowdown.
Economy Review
The key events in the month were –
•
Domestic factors -
o
Unlock Phase 3 in India: India has entered "Unlock 3.0", which is
the third phase of easing lockdown restrictions in the country. The central
government has lowered travelling restrictions than. As per the new guidelines,
the night curfew in the country has ended and even interstate travel is freely
permitted.
o
Trade Surplus: The trade surplus for June’20 stood at $0.79 bn as
compared to a deficit of $3.15 bn in May’20. June exports fell by 12.4% yoy to
$21.9 bn while July imports contracted 47.6% yoy to $21.1 bn.
o
Manufacturing PMI: India Manufacturing Purchasing Manager's
Index moderated to 46 in July’20 vs 47.2 last month as lockdowns in certain
cities to contain coronavirus cases weighed on demand and output.
o
Monsoon: Rainfall in July’20 was 9% below long-term average. Till
29th July’20, cumulative rainfall was 1.3% above long-term average. Kharif
sowing up 13.2% in terms of acreage from last year. Basin-wise reservoir levels
were marginally surplus compared to long-term average levels.
•
Global factors –
o
COVID-19:The total number of COVID-19 cases crossed 18mn
worldwide as on 2nd August’20 with a fatality rate of around 4.0%, while
there
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are close to 1.8mn cases in India with a lower fatality rate of 2%. As numbers of
new cases kept rising there has been good news of successful progress of Covid-
19 vaccine trials.
o
US GDP: Donald Trump announced suspension of foreign work
visas (including H-1B visa) till 31st December’20.
o
FED: US Fed left key interest rate unchanged and remained
extremely dovish in its July’20 meeting.
o
Eurozone: Eurozone economic sentiment index climbed to 82.3 in
July’20 from 75.8 in the previous month.
o
China Manufacturing PMI: China’s Manufacturing PMI rose to
52.8 in July’20 from June's 51.2.

Domestic macro economic data.

Inflation- CPI moderated to 6.1% in June’20 from 6.3% in May’20. WPI came in at -1.8% in June’20 Vs
-3.2% in May’20.

Fig : 2.6a Inflation graph

Economy Review

2016 was an eventful and a volatile year. On the domestic front, there were a number of
positives. The key positive events were – a) passage of GST bill, b) normal monsoons, c)
better corporate earnings and d) start of revival of investment cycle. The key negative events
which worried the market in 2016 were a) Britain voting out of Eurozone, b) outcome of US
elections and c) demonetization drive by government.

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There is an expectation that there will be a slowdown in GDP growth as RBI has revised the
growth target from 7.6 per cent to 7.1 per cent. Once the demonetization effect subsides,
growth will bounce back in the second half of 2017. Various new schemes announced by the
government recently, particularly for villages should push rural demand. Growth in corporate
earnings should come back with strong domestic demand and boost to infrastructure
spending.

December was an eventful month. In spite of a rate cut expectation from the Reserve Bank of
India in the December policy meet, RBI left the policy rates unchanged. Both the houses of
the Parliament didn't function in the winter session. The US Federal Reserve increased rates
by 25 basis points in December 2016.

Domestic macroeconomic data remains mixed. On the economy front, IIP for October-16
declined to
-1.9 per cent compared to 0.7 per cent in September-16

Fig : 2.6b IIP graph

However, inflation (CPI) for November-2016 was recorded at 3.6 per cent, lower than 4.2 per cent
for the month of October-2016. The decrease in inflation was led by lower food prices.

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Fig : 2.6c Inflation (CPI) graph

Outlook for Equities

The Sensex lost around 0.25% in the month of December. FIIs sold $1.15bn in the month.
Cumulatively, they are net buyers of $3bn for the year. Domestic institutions remained net buyers
for the month. They bought $1.2bn in December. Cumulatively, they are net buyer of $5.3bn
for the year.

At a 14.5 multiple of FY18 earnings, markets are trading below their 15 year average. Investors in
equity funds can expect significant gains in long-term with higher growth in corporate earnings.

Fig : 2.6d outlook for equities

Outlook for Debt
The 10 year government bond yield moved from 6.22 per cent to 6.52 per cent in the
month. We expect the 10 year G-sec yield to be in the range of 6 per cent to 6.5 per cent
in the near term. The

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corporate bond yields are expected to maintain a spread of 30 to 50 basis points on the upward side.
Investors in bond funds will gain significantly with bond yields coming down further.

Fig : 2.6e outlook for debt

CHAPTER : 3

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PROJECT PROFILE

3.1 PURPOSE OF THE STUDY

For my research work the selected topic is of consumer buying behaviour with shriram life
insurance. For any organization it is fundamental that the organization should be well aware
to the clients. Results of any organization won't be sold until purchasers of those items or
administrations know about it. A human being is an income generating asset. One’s income
generating ability depends on one’s skills, (manual, professional, problem solving,
entrepreneurial, etc.) These are the assets the value of which can be measured by
considering the income that is generated by the person concerned. The concept of human
life values provided by insurance enables the determination of the asset value of the human
life and therefore, the amount of life insurance required. Life insurance emphasizes the
preservation of the economic value of the human asset in the event that these assets may be
lost through unexpectedly early death or through sickness and disabilities caused by
accidents.7 Insurance as a social security tool – The United Nations Declaration of Human
Rights 1948 provides that “Everyone has a right to a standard of living adequate for the
health and wellbeing of himself and his family, including food, clothing, housing and medical
care and necessary social services and the right to security in the event of unemployment,
sickness, disability, widowhood or other lack of livelihood in circumstances beyond his
control”. When the bread winner dies, to that extent, the family’s income dies. The economic
condition of the family is affected, unless other an alternate arrangement. Under a socialist
system, the responsibility of full security would be placed upon the State to find resources for
providing social security. In the capitalistic society, provisions of security are largely left to
the individuals. The society provides

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instruments which can be used in securing this aim. In India, social security finds a place in
our Constitution. As per the law and the directions of the regulatory authorities, insurance
companies in India are obliged to extend insurance benefits to economically weaker sections of
the society in the unorganized sector. This research aims at finding out the impressions of the
public about the basic need for life insurance. An attempt has been made to establish a
relationship between person’s realization for the need for life insurance and the time when
he actually purchases the policy. It is of absolute importance for an individual who is a bread
winner to realize that the value his life holds in terms of the economic gain that it brings to
his family can be protected only through life insurance. If this does not happen, his family
would be pushed into the lower strata of society. The lower strata create a cost on society
since the poor bring additional cost to the nation by way of subsidies. Life insurance
business helps to reduce such costs. In this sense, the life insurance business is
complimentary to the State’s efforts in social management.

3.2. STATEMENT OF THE PROBLEM:

The Life Insurance market in India was an under developed market that was only tapped by the
state owned LIC till the entry of private insurers. Insurance industry, as on 1.4.2000, comprised
mainly two players: the state insurers – Life Insurance Corporation of India and General Insurers,
the General Insurance Corporation of India. In India, insurance is generally considered as a tax-
saving device instead of its other implied long term financial benefits. Indian people are prone
to investing in properties and gold followed by bank deposits. They selectively invest in
shares also, but the percentage is very small.6 Even to this day, Life Insurance Corporation
of India dominates Indian insurance sector.The penetration of life insurance products was 19
percent of the total 400 million of the insurable population. The state owned LIC sold
insurance as a tax instrument, not as a product giving protection. Most customers were
under insured with no flexibility or transparency in the products. With the entry of the private
insurers the rules of the game have changed.

Private sector players backed by foreign expertise have made the Indian insurance market
more vibrant. The growing popularity of the private insurers shows in other ways. Twenty three
private Life Insurance Companies have been registered since the year 2000 till now. They are
coining money in new niches that they have introduced. The state owned companies still
dominate segments like endowments and money back policies. But in the annuity or pension
products business, the private insurers have already wrested over 33 per cent of the market.
And in the popular unit-linked insurance schemes they have a virtual monopoly, with over 90
percent of the customers.

With an annual growth rate of 15-20% and the largest number of life insurance policies in force, the
potential of the Indian insurance industry is huge. Total value of the Indian insurance market (2004-
05) was estimated at Rs. 450 billion (US$10 billion). According to government sources, the
insurance and banking services' contribution to the country's gross domestic product (GDP) is 7%
out of which the gross premium collection forms a significant part. The funds available with the
state-owned Life Insurance Corporation (LIC) for investments are 8% of GDP. The following
table shows the total growth in the Insurance Premium collected in the years from 2001-02
to 2008-09

This study is an endeavour to analyze the tremendous impact made by private sector
insurance companies in achieving this phenomenal growth in the life insurance sector. The
intention of this study is to inform various insurers regarding the range and complexity of
insurance awareness issues. The report will equip insurance companies with a ready
reference to the fundamental aspects of business. The aim of this study is to reach those
with limited knowledge of insurance and to provide a comprehensive picture of the awareness
scenario across the country. This study mainly attempts to compare the performance of the top
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six private sector life insurance companies and evaluate their

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profitability and efficiency in the marketing of financial services in the country. It also
attempts to compare the training methods practiced by public sector Life Insurance Corporation
and ten of the top private 6 companies. An evaluation on effectiveness of training programmes is
done to analyse the costs and benefits of training in Insurance companies. Finally this study
attempts to study the shift in customer perception towards private Life Insurance Companies. It
also pin points the various causes for failure on the part of public sector insurance companies
to sufficiently penetrate the market for insurance in India.

3.3. objectives & scope:

Objectives:
• To know awareness of people in Kurnool district Adoni about insurance.

• To know awareness of people in Kurnool district Adoni about Shriram Life Insurance.

• To know the general preference of people for investment.

• To assess the performance of Public sector vis a vis Private Sector Life
Insurance Companies.

• To have an in depth understanding of the problems faced by public sector and

private sector Life Insurance Companies and suggest suitable remedies.

SCOPE OF THE STUDY

This project study is helpful in following aspects.

 It will be helpful to the professionals of Shriram life insurance co. It’d. to

know the level of brand awareness among the industrial units in Bangalore
city.

 It will be helpful in knowing awareness about the competitors.

 It will be helpful in knowing the awareness level about the policies
offered by Shriram life insurance.
 It will be helpful to know the satisfaction level of the customers to the insurance
companies.
3.4. Work done in the company

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A man without practical knowledge is just like a rough diamond. To shine like a
real diamond one must have practical exposure of what he has learnt. For the
students of management theoretical knowledge is just like lock without key so
practical knowledge is of so much important.
Summer Internship Project also helped me to understand interaction with employees
and customers and approaches to the customers.
I spent four weeks as an intern in shriram life insurance and assign to sell the
insurance policy in digital platform where I reached the target and selected as a BEST
INTERN in the group. The first few weeks of my internship program was started in
zoom meeting where the company mentor gave the orientation about shriram life
insurance and explain two major policies which I have to sell in my internship
program the two plans consist of ASSURED INCOME PLUS and SUPER
INCOME PLAN.
The second phase of my internship program was digital marketing of insurance where
we used to contact the clients through social media platform and try to contact
with them to sell the policy.
The third phase is consist of market research about consumer’s buying behaviour
with shriram insurance.

3.5. METHODOLOGY

1. This study is based on both primary and secondary data. Data required for the survey
was collected from various publications, articles, journals, related texts and the IRDA
website.
2. Three primary data surveys were conducted through well structured interview schedule
prepared by the researcher in consultation with the experts in the field. The primary
data survey was conducted in three phases – Firstly a survey on 140 respondents was
conducted to study customer awareness and preference for life insurance as an
investment alternative and the results analyzed. In the second phase an exhaustive
survey was conducted by a Structured Questionnaire administered to two groups of
samples representing the population of Policy Holders and of both public sector and
ten private life insurance companies. Thirdly a survey of employees and agents of
public sector LIC and ten private sector Life insurance companies were conducted.

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3. The performance analysis of private sector and public sector was done by
obtaining Secondary data collected from various books, journals, IRDA reports and
websites. An analysis of financial statements of LIC and six top private insurance
companies was done and their performance was evaluated. An in depth analysis was
made on all the investment plans offered by public sector and private sector insurance
companies.
3.6. DATA COLLECTION, INTERPRETATION AND ANALYSIS
RESULTS AND INTERPRETATION

Demographic Profile:

The demographic profile of the respondents includes Gender, Age, Income, Occupation, and
Education Level.
GENDER
The Gender ratio is 88% (44) males and 12% (6) of females.

Gender

Female;
12.00%

Male;
88.00%

Fig : 3.6a gender of people who attended the survey

AGE
For the analysis purpose, the age of respondents has been classified into four categories 17 to
30-52%of people, 31 to 40-20%, 41 to 50-12%, and 51 to 60-16%.

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Age

51-60; 16.00%
41-50; 12.00%
17-30; 52.00%

31-40; 20.00%

Fig : 3.6b age of people who attended the survey

INCOME
Income has been measured as monthly income ranging from Below Rs.10000-16% (8),
Rs10000 to 20000-38% (19), Rs20000 to 30000- 18% (9), more than Rs.30000-20% (10).

Income

More than
30000; 21.74%Below 10000;
17.39%

20000-30000;
19.57% 10000-20000;
41.30%

Fig : 3.6c income of people who attended th survey

OCCUPATION
The occupation status of respondents has been grouped as Business 40% (20), Service 52%
(26), None 8% (4).

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Occupation

None; 8.00%

Buisness;
40.00%

Service;
52.00%

Fig : 3.6d occupation of people who attended the survey

EDUCATION LEVEL
The education level of respondents has been measured in terms of Undergraduates 38% (19),
Graduates 44% (22), and Postgraduates 18% (9).

Education Level

Post Graduate; 18.00%

Undergraduate; 38.00%

Graduate; 44.00%

Fig : 3.6e Education level

INVESTMENT PREFERENCE
Question: When it was asked to respondents where would they like to invest their money,
among Insurance, Real Estate, Mutual Fund, Share Market, Banks & Post.

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The following results were obtained

Insurance 16%
Real Estate 14%
Mutual Fund 18%
Share Market 26%
Banks & Post 26%

Invetment Preference
Banks & Posts; 26.00%Insurance; 16.00%
Real Estate; 14.00%
Mutual Funds; 18.00%

Share Market; 26.00%

Fig : 3.6f investment preference

Interpretation: The results shows that there is higher group of people who are conservative
and save their money in banks and posts and also there are more number of people who wants
aggressive investing like in share market, but there is mixed opinion for insurance, mutual
funds and real estate.

PREFERENCE TO BUY INSURANCE

Question: The respondents were asked that which company would they prefer to buy an
insurance policy among these companies Birla Sun Life, LIC, Max New york Life insurance
8%, ICICI, SBI, ING Vysya, TATA AIG, Bajaj Allianz, Other, and following results obtained

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Birla Sun Life 22% TATA AIG 6%

Insurance
LIC 18% Bajaj Allianz 10%
Max New york Life 8% ING Vysya 2%
ICICI Prudential 4% Others 16%
SBI 14%

Interpretation: The results shows that public sector companies are more preferred than
private sector companies, but still in private sector reputed companies like Birla Sun Life and
Bajaj Allianz is also preferred.

Preference on Buying Insurance

Other; 16.00%
Birla; 22.00%

Bajaj; 10.00%

TATA; 6.00%
ING; 2.00% LIC; 18.00%

SBI; 14.00% ICICI; 4.00% MNYL; 8.00%

Fig : 3.6g preference to buy insurance

CURRENT INSURANCE POLICY

Question: When respondents were asked that which company’s insurance policy they have,
among these companies MNYL, LIC, Birla, SBI, ICICI, Shriram, HDFC, Reliance Life
Insurance, Bajaj Allianz, TATA AIG, MetLife, ING Vysya..

The Following Results were obtained

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MNYL 10% HDFC 4%

LIC 26% Reliance Life 4%
Birla Sun Life 28% Bajaj Allianz 6%
SBI 8% TATA AIG 4%
ICICI Prudential 10% MetLife 6%
Shriram 2% ING Vysya 2%

Current Insurance Policy

Metlife; 5.77% ING; 1.92% MNYL; 9.62%

TATA; 7.69%

Bajaj; 5.77%
LIC; 25.00%
Reliance; 3.85%
HDFC; 3.85%
Shriram; 1.92%

ICICI; 9.62%
SBI; 7.69%

BIRLA; 17.31%

Fig : 3.6h current insurance policy

Interpretation: The result shows that public sector companies like LIC, SBI as well as
private sector companies like Birla Sun Life Insurance, ICICI, and MNYL have more policy
holders.

ANNUAL PREMIUM
Question: When respondents were asked how much premium do they pay annually. Option
give to them were below Rs.3000, Rs.3000-5000, Rs.5000-7000, more than 7000.

The following results are obtained

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Below 3000 Rs. 28%

3000-5000 Rs 42%
5000-7000 Rs. 20%
More than 7000 Rs. 10%

Annual Premium

More than
7000; 10.00%
Below 3000;
5000-7000;28.00%
20.00%

3000-5000;
42.00%

Fig : 3.6i annual premium

Interpretation: The result shows that people prefer to pay 3000 to 5000 Rs. So Companies
should form such policies.

PURPOSE OF INVESTMENT
Question: When respondents were asked what is the basic purpose to invest in insurance
policy. In the following options Cover future uncertainty, Tax deduction, Future investment,
other

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.The following result was obtained

Cover Future Uncertainty 34%

Tax Deduction 26%
Future Investment 36%
Other 4%

Purpose of Investment

Other; 4.00%

Future in- vestment;Cover Future Un- certainty; 34.00%

36.00%

Tax Deduction; 26.00%

Fig : 3.6j purpose of investment

Interpretation: The result shows that people are investing in insurance for future
investments or cover future uncertainty rather than tax deduction.

FEATURE OF POLICY
Question: The respondents were asked that which feature of their policy attracted them to
buy that policy and options were: Trusted Name or Reputation of the Company, Friendly
Services, Good Plans, and Low Premium.

The followings results were obtained

Trusted Name or Reputation of Company 40%

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Friendly Services 16%

Good Plans 24%
Low Premium 20%

Features of Policy

Low Premium; 20.00%

Trusted Name or Reputation; 40.00%

Good Plans; 24.00%

Friendly Services; 16.00%

Fig : 3.6k feature of policy

Interpretation: The results shows that people while buying insurance prefer trusted name or
reputation of the company than low premium, good plans, and friendly services. So company
should create good reputation for it self.

AWARENESS ABOUT SHRIRAM LIFE INSURANCE

Question: The respondents were asked whether they are aware about Shriram Life Insurance.

The following results were obtained

yes 58%
NO 42%

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Interpretation: The result shows that more people are not aware about Shriram Life
Insurance. So more marketing is required from the side of the firm.

AWARENESS THROUGH CHANNELS

Question: 18 Respondents who were about Shriram Life insurance were asked through which
medium they were aware about the company and the options were News Papers, T.V,
Contacted by Agents, Friends or Reference.

The following results were obtained

News Papers 20%

Television 0%
Contacted By Agent 29%
Friends or Other Reference 51%

Awareness Through Medium

News Papers; 20.00%

Friends or Reference; 51.00%

Contacted by Agents; 29.00%

Fig : 3.6l awareness through medium

Interpretation: The result shows that the respondents who know about Shriram Life
Insurance, knows from friends, reference or contacted by agents so marketing is inadequate
because very few people know through newspapers and no one through Television.

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AWARENESS ABOUT SERVICES/PRODUCTS OF THE COMPANY

Question: 18 respondents who were about Shriram Life Insurance were asked if they know
about the products of the company and following results were obtained

YES 69%
NO 31%

Awareness About Products

No; 31.11%

Yes; 68.89%

Fig : 3.6m awareness about product

Interpretation: The result shows that who respondents who knew about Shriram Life
Insurance, most of them knew about their products because mainly they were contacted by
agents or reference.

SATISFACTION WITH THE SERVICES

13 respondents who were aware about the service or products were asked whether the
services were good enough to satisfy or not and all of them replied positively. This shows that
products of the company are very good.

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CHAPTER : 4
KEY LEARNINGS & RECOMMENDATIONS

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4.1 OBSERVATIONS
The life insurance density of India was 9.1 percent in the year 2000-01 when the
private sector was opened up. It increased to 52.2 percent in 2009-10.India’s life
insurance density is very low as compared to the developed countries and developing
countries, inspite of India being the second most populous country in the world. This
shows that there is much scope for life insurance sector to develop in India.
Operational effectiveness, respectability and a solid spotlight on taking into account
the requirements of the normal Indian, by offering him high calibre and practical
items and administrations, are the basic beliefs that drive the association. These
qualities have been emphatically clung to throughout the decades and are currently
an indispensable piece of the association's DNA. The organization highly esteems its
profound comprehension of the client. Every item or administration is customized to
explicitly suit the requirements of the client. It is this controlling way of thinking of
putting individuals first that has brought the gathering organization closer to the
grassroots and has settled on it the favoured decision for all truck financing
prerequisites among the clients.

4.2 EXPECTATIONS AND ACHIEVEMENTS

The main expectation of an insurance company is to keep the clients happy and to
provide customer service with honest and right information. The troubles confronting new
disaster protection specialists are extraordinary in number. Finding qualified clients,
yourself is troublesome

Mr. Manoj Jain, MD & CEO, Shriram Life Insurance Co. Ltd along with Mr. Samir Shah
(MD & CEO — NCDEX Ltd) was awarded as the “CEO of the Year” in BFSI category. His
extensive experiences and insights have not only facilitated Shriram Life in achieving new
heights but have been respected throughout the insurance industry as well.

Shriram Insurance also won the ‘Best Life Insurance Company’ in the Insurance Sector.
Our unwavering efforts in bringing constant development of Life Insurance, particularly
in Rural and Social Sector, have been acknowledged as well as applauded.

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4.3 LEARNINGS FROM SIP

A man without practical knowledge is just like a rough diamond. To shine like a real
diamond one must have practical exposure of what he has learnt. For the students of
management theoretical knowledge is just like lock without key so practical
knowledge is of so much important.
The summer internship project has given the opportunity to learn and know about
real corporate experience and understand working environment. Practical knowledge is
the best experience and on this basis, we can easily understand about what they
want to say. Firstly each student knows about the theory, so that on the basis of
theory, he can easily learn how to do the work and what is the best way to achieve
satisfaction. That is why we can say that theory is guidelines for practical.
During my internship what we learnt in theories about financial management, human
resource management, and also about marketing, I experienced all those functional
departments working in the real situations which was quite amazing.
The working of the functional departments helped me like financial department
allocated funds, human resource department providing training, and selection of new
candidates, performance appraisal motivating employees.
Summer Internship Project also helped me to understand interaction with employees
and customers and approaches to the customers.
It was really helpful for me because Shriram Life Insurance Company is based on
insurance policy as product which is a push based product, so it helped me to learn
about real marketing exposure.
During our summer internship project, I did research about consumer awareness
about Shriram Life Insurance, which helped me to learn general preference of people
for investment, awareness about all insurance companies, preference for buying
insurance and also awareness about Shriram life Insurance and their products.

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The summer internship project also helped to analyze how a company is working with such
competition and also with competitors doing their business.
The experience with Shriram Life Insurance was really handful and very cooperative
with employees and heads of the company.
At the end it has helped that how work in real life exposure, which will ultimately help me
to work when I start working in the corporate sector.

4.4 FINDINGS AND RECOMMENDATIONS OF THE COMPANY

On the basis of the research project work I did, there are some findings and recommendations
that have been mentioned under.

• Public sector insurance companies have very large business as compared to private
general insurance companies. So private companies have to go long for more and
increased business.

• These private companies have to build a strong image as the PSUs have to increase
their business. People put more trust on government hold companies than private
insurance companies so private insurance companies have to win confidence of
people and have to create strong corporate image.
• This is clear from the research that more people want to invest in banks and mutual
funds then insurance, shares or other investments.
• Even in private companies Birla Sun life Insurance, Max New York life Insurance,
TATA AIG and HDFC with trusted name are more preferred to buy insurance.
• This is observed that people are willing to invest 3000-5000 Rs. So Companies should
develop plans having such premiums.

• People are more willing to invest for future investments then tax deduction so such
plans should be developed.

• Respondents were willing to buy policies on the basis on trusted names, good plans
and low premiums.

• Consumer awareness of Shriram Life Insurance is less as compared to the PSUs. So

efforts should be made to increase the awareness of the company.

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• Awareness towards the advertisement of Shriram Life Insurance is found very less
among the People and most people know about the company through agents of
reference. So it is advised to the company to go for more advertisements through
different medias to increase the awareness of the company.

• The respondents who know about Shriram Life insurance, most of them Knew about
the products.

• People who were about the services or products though that products were good
enough to satisfy needs. So it shows that products are good to meet needs of people.

4.5 CONCLUSION
India has traditionally been a high savings oriented country - often described as being on par
with the thrifty Japan. Insurance sector in the US of A is as big in size as the banking industry
there. This gives us an idea of how important the sector is. Insurance sector channelizes the
savings of the people to long term investments. In India where infrastructure is said to be of
critical importance, this sector will bring the nations own money for the nation.

In 3 years time we would expect the 10% of the population to be under some sort of an
insurance cover. This assuming a premium of Rs. 5000 on an average, amounts to 100 million
x Rs.5000 = Rs. 500 bn. This has made the sector the hottest one in India after IT.

With social security and security to the public at large being the agenda for opening the
sector, the role of the regulator becomes all the more serious and one that would be carefully
watched at every step. India has an enormous middle-class that can afford to buy life, health,
and disability and pension plan products. The low level of penetration of life insurance in
India compared to other developed nations can be judged by a comparison of per capita life
premium. Clearly, there is considerable scope to raise per capita life premium if the market is
effectively tapped.

There has been tremendous change in the insurance history. And with it there has been
continuous growth in this sector both in Indian as well as world context. The opening up of
the insurance sector has changed the whole look of the industry. While the LIC in order to

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face the competition is coming with new strategies and new players like Shriram are leading
the sector due to their strategic management and tailored made projects.

From our study also we conclude that though the awareness and people opting for LIC plans
are more as compare to Shriram but the later are gaining momentum in the market day by
day.

The demand for insurance is likely to increase with rising per-capita incomes, rising literacy
rates and increase of the service sector, as has been seen from the example of several other
developing countries. In fact, opening up of the insurance sector is an integral part of the
liberalization process being pursued by many Developing countries.

Insurance is a Rs.400 billion business in India and yet its spread in the country is relatively
thin. Insurance as a concept has not been able to make headway in India. There has been a
strong fall in insurance business in recent years. Furthermore, it can be observed that non-life
business is not increasing as strongly as life business. On the other hand, growth fluctuations
have been relatively small with growth rates varying between 1% and 5%. Life insurance
business by contrast achieved average growth rates of 6%, although the actual rates ranged
from 0% to 13%.

This shows on the one hand the increasing significance of life insurance as an instrument for
old age provisions and on the other hand indicates the sensitivity of life insurance to changes
in the institutional and economic environment. So lets conduct this business with utmost
economy with the spirit of trusteeship; thereby making insurance widely popular

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BIBLIOGRAPHY
Books:
• I.M.Pandey: Basic Text Book of Financial Management: 9th Edition (2008): Vikas
Publication

• C.B.Gupta: Human Resource Management: 4th Edition (2007): Sultanchand and Sons

• Kotler, Keller, Koshy and Jha: Marketing Management: 6th Edition (2007): Pearson
Education

• C.R.Kothari: Research Methodology: 4th Edition (2004): New Age International

Limited

• Khan and Jain: Financial Management: 4th Edition (2004): Tata McGraw Hill

• Cooper and Schindler: Business Research Method: 9th Edition (2006): Tata McGraw
Hill

Magazines & Journals:

• Walden, Michael L. (1985); The Journal of Risk and Insurance: “Whole life policy is
a package of options“ (Vol.52 no.1,pp 44-58).
• Slovic, Fischhoff, Lichtenstein, Corrigan and Combs, (1977) Decision Research:
“Insurance against small, high-probability losses” (vol.2, issue 2, pp83-93).
• Formisano, Roger A. (1981); The Journal of Risk and Insurance: “Awareness of the
provisions of the regulation” (Vol.48 no.1, pp59-79)

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• Smith, Michael L.(1982); The Journal of Risk and Insurance, “Policy owner behavior
towards life insurance” (Vol.49 no.4, pp583-601)
• Kirchler and Angela Christian Hubert: “Spouses ‘relative dominance in decisions
concerning different forms of investment” (.1999; accepted 1999; Available online
1999); Institute of Psychology, University of Vienna.

Websites:
www.shriram.com
www.irda.com
www.apnapaisa.com
www.indiainfoline.com
www.sanlam.com

A Study on Consumer Awareness about Shriram Life Insurance

1. Name:

2. Age:
3. Gender: Male Female
4. Occupation: Business Service None
5. Education Undergraduate Graduate Postgraduate
6. Monthly Income:
Below 10000 10000-20000 20000-30000 more than 30000
7. Where do you prefer to invest your money?
Insurance Real Estate Bank & Post Mutual Funds
Share Market Others
8. Which company’s insurance policy you prefer the most?
Birla Sun life LIC Max New York Life ICICI Prudential
SBI ING Vysya TATA AIG Bajaj
Other
9. In which you have any insurance policy?
Write the name of the company
10. How much do you pay annually?

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Below 3000 3000-5000 5000-7000 More Than 7000

11. What is the basic purpose of your investment in Insurance?
Cover Future Uncertainty Tax Deduction Future Investment Other
12. Which feature of your policy attracted you to buy it?
Good Plans Friendly Services Trusted Name or Reputation of
Company Low Premium
13. Are you aware about Shriram Life insurance?
Yes No
14. If yes then through which medium,
Newspapers Television Contacted By Agent Friends or other
Reference
15. Are you aware about services/products of Shriram Life Insurance?
Yes No
16. Are you satisfied with the services?
Yes No

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