You are on page 1of 54

Max New York Life Insurance 1.

1 Introduction to Indian Insurance Industry


1.1.1 Brief overview
With over 300 million life policies in force, substantial premiums and double-digit growth in both segments (life and non-life), Indias insurance sector is poised to mark incredible pace of progress in the years to come. Liberalisation in the sector led to the entry of foreign players with significant capital commitments and growth aspirations in the Indian insurance arena. Low penetration, availability of a wide variety of products (like unit-linked insurance products, whole life, maximum net asset value (NAV) guarantee etc) and government incentives are the key drivers that would give great impetus to the industry. Foreign corporate giants are not leaving any stone unturned to be a part of Indias economic growth story and hence are lobbying hard with their lawmakers to aid them in their entrance or expansion plans in the fast-growing Asian economy. Lobbying disclosure reports filed by certain companies with the US Senate reveal that The New York Life Insurance Company has lobbied on issues related to Insurance Act in India, provisions related to cap on foreign investment, while Prudential Financial Inc has lobbied on issues relating to India financial services market access and equity ownership issues.

1.1.2 Market Share


State-owned Life Insurance Corporation (LIC) of India held a market share of around 76 per cent in terms of new business premium for the financial year up to August 2011 while the remaining was divided among 23 private insurance companies. LIC has been continuously increasing its market share on the back of its strong base of conventional products, which remained unaffected by the change in regulations, and its group retirement plans.

Navnirman Institute Of Management

Page 1

Max New York Life Insurance


1.1.3 Recent Statistics
Data released by the Insurance Regulatory and Development Authority (IRDA) indicates that the life insurance industry collected Rs 49,064 crore (US$ 10 billion) in the first six months of 201112 while the non-life insurance industry posted a 26 per cent year-on-year (y-o-y) growth in gross written premium during the same period. According to the data by IRDA, the non-life insurance industry gathered a total premium of Rs 28,604 crore (US$ 5.82 billion) during AprilSeptember 2011-12 as against Rs 22,744 crore (US$ 4.63 billion) in the corresponding period last year. The four state-run insurers - New India Assurance, United India, National India and Oriental India - witnessed an increase of 25 per cent while private sector companies registered a growth of 27 per cent in premium. During the April-August 2011 , the life insurance industry in India collected premiums worth Rs 71,565.49 crore (US$ 14.57 billion) by writing new policies. While LIC collected Rs 30,912.31 crore (US$ 6.29 billion), private insurers collected Rs 9,740.87 crore (US$ 1.98 billion). In August itself, the total premium collection by the industry was Rs 13,857.89 crore (US$ 2.82 billion), 62 per cent higher than Rs 8,511.25 crore (US$ 1.73 billion) collected in July. For the general insurance industry, collections stood at Rs 23,712.75 crore (US$ 4.83 billion) by writing new policies during the April-July 2011-12, compared with Rs 19,144.06 crore (US$ 3.89 billion) collected last year. While private insurers registered a growth of 25.97 per cent at Rs 9,861.28 crore (US$ 2 billion), the four state-owned general insurance companies' collection was higher by 22.74 per cent at Rs 13,851.47 crore (US$ 2.82 billion).

Navnirman Institute Of Management

Page 2

Max New York Life Insurance


1.1.4 Recent Developments

Warren Buffets Berkshire Hathaway ventured into Indian general insurance industry in March 2011 and is now ready to launch an online term cover to foray into the life insurance segment. Berkshire India, a joint venture (JV) between Nebraska-based Berkshire Hathaway and Allianz, is mushrooming at a fast pace and would also launch a health insurance product soon.

Edelweiss Tokio Life Insurance Company Ltd (ETLICL) - a 74:26 JV company between Edelweiss Financial Services Ltd and Japanese insurance major Tokio Marine Holdings has massive expansion plans on cards. The company is planning to open 33 new branches at selected locations across India, including 14 in Maharashtra, by December 2012.

With an aim to strengthen its distribution network and reach out to the rural masses across India, Max Bupa Health Insurance Company Ltd is in talks with regional rural banks, co-operative banks and post offices to distribute its health insurance products. The company, majorly relying on the model of bancassurance, is in talks with IRDA for the same.

IRDA has given its nod to Videocon Group's general insurance JV with the US-based Liberty Mutual Group. Liberty Mutual, with 26 per cent stake in the JV initially, will have an option to increase its stake if regulations permit.

1.1.5 Government Initiatives


IRDA is now planning to allow agents to sell products of more than one insurance company. The new model would not only allow private insurers to have access to the huge range of agents selling LIC products, but would also increase the income in the hands of agents. This would also facilitate deeper penetration of insurance products in the Indian markets. IRDA is also planning to ban misleading products (which offer so-called highest NAV) and staggered commissions for agents for the welfare of policy buyers. According to the regulator,

Navnirman Institute Of Management

Page 3

Max New York Life Insurance


the still-evolving industry needs new set of rules that protect the interests of consumers so that they do not get carried away with the promises of high returns that are just shown on papers. The regulator also stipulated a set of guidelines relating to sale of policies through distance marketing on October 1, 2011 in order to curb misspelling of insurance policies and protect consumer interest. The guidelines apply to every activity of solicitation and sale of insurance products through the internet, e-mail, newspaper inserts, SMS and telephone and require every insurer to prepare a standardised script for the purpose and file this with the regulator. Every telephonic conversation with the customer needs to be recorded and a voice copy is to be given to the consumer (if he/she so desires) at any time during the term of the policy or until a satisfactory settlement of claim, whichever is later. Moreover, the Ministry of Finance is holding internal discussions on listing of the four general insurance companies - New India Assurance, National Insurance, Oriental Insurance and United India Insurance. The move would give access to public capital to these companies. However, the four companies would not get listed together.

1.1.6 Road Ahead


According to a survey by Swiss Re, the worlds second largest reinsurance company, Indias next generation of consumers are increasingly getting aware of the benefits of insurance and will be more-than-willing to purchase cost-effective policies in years to come. Indias insurance industry is anticipated to reach US$ 350-400 billion in terms of premium income by 2020, making it among the top three life insurance markets, according to a report by a leading industry body and US-based Boston Consulting Group (BCG). India is expected to be one of the top 15 non-life insurance markets by 2020. The report further stated that penetration of the insurance industry, premium as percentage of the country's gross domestic product (GDP), has improved from 2.3 per cent in 2001 to 5.2 per cent in 2011. Exchange Rate Used: INR 1 = US$ 0.0204 as on November 7, 2011

Navnirman Institute Of Management

Page 4

Max New York Life Insurance 1.2 Introduction to Max New York Life Insurance
1.2.1History
Max New York Life Insurance Company Ltd. is a joint venture between Max India Ltd., one of Indias leading multi-business corporations and New York Life Enterprises, a business unit of New York Life, a Fortune 100 company. Incorporated in 2000, Max New York Life started commercial operation in 2001 and today is one of Indias leading private life insurance companies and has positioned itself on the quality platform. In line with its vision to be the most admired life insurance company in India, it has developed a strong corporate governance model based on the core values of excellence, honesty, knowledge, caring, integrity and teamwork. The company offers long term savings and protection solutions through a suite of individual and group life insurance products and is present across the country through a wide distribution network of multi channel distribution. Agency distribution is at the core of our multi-channel distribution network complemented by bancassurance, partnership distribution and employed sales force. The Company places a lot of emphasis on its selection process for agent advisors, which comprises four stages - screening, psychometric test, career seminar and final interview. The agent advisors are trained in-house to ensure optimal control on quality of training. 195 agent advisors have qualified for the Million Dollar Round Table (MDRT) membership in 2010. MDRT is an exclusive congregation of the worlds top selling insurance agents and is internationally recognized as the standard of excellence in the life insurance business. The company corporate agency and broking tie-ups with banks and other distributors of financial products. Max New York Life offers a suite of flexible products. It has 23 individual life and health insurance products and 9 riders that can be customised to suite every need of the customer. Besides this, the company offers 4 products and 7 riders in group insurance business.

Navnirman Institute Of Management

Page 5

Max New York Life Insurance


In line with its values of financial responsibility, Max New York Life has adopted prudent financial practices to ensure safety of policyholder's funds. The Company's paid up capital as on 31st March, 2011 was Rs. 1976 crore. Max New York Life Insurance has emerged as a key player in the Life Insurance Industry since the government allowed entry of private players in 2000. The Companys business model has evolved by earning trust of key stakeholders like Policyholders, Shareholders & Regulator (Insurance Regulatory and Development Authority). During the year, Max New York Life took major steps towards strengthening its multi-channel distribution architecture by entering into corporate agency tie-up with Axis Bank.

Key aspects regarding Max New York Life Insurances performance are detailed below. (All figures as of March 31st 2011)

Max New York Life Insurance covered 127.63 lacs lives (in-force) providing a total insurance cover of over Rs. 1, 54,000 crores to its customers.

Market Share has increased up to 7.5% on Adjusted Individual First Year Premium. Total Capital stood at Rs. 1,976 crores. Assets under management at Rs. 13,836 crores. Solvency Margins stood at 365% as against the 322% for the previous year.

Navnirman Institute Of Management

Page 6

Max New York Life Insurance


1.2.2 Vision,Mission and Values Vision
To become the most admired Life Insurance Company in India for all stakeholders.

Mission

Amongst top 5 private life insurance companies by profitable new business sales National Player Brand of choice Employer of Choice Principal of Choice for Distribution & Suppliers

Navnirman Institute Of Management

Page 7

Max New York Life Insurance


Values
This vision to become India's most admired life insurance company will be realized through our unique set of values, which are as follows: Caring: Max New York Life is redefining the life insurance paradigm by focusing on customers first. The service process is responsive, personalized, humane and empathetic. Every individual who represents the company is for us our brand champion. Honesty: Honesty is the heart of the life insurance business. It is all about trust. Transparency, integrity and dependability form the cornerstones of the Max New York Life experience. The company ensures that everyone who represents the brand carries a promise: we care - in word as well as deed. Excellence: Excellence at Max New York Life implies the ability to perform at a consistently high level. Focused on the value of continuous improvement in people, processes and the organization, the company strives for the highest standards of quality in every aspect of its business. Knowledge: Knowledge leads to expertise; and our expertise is in helping people protect themselves. Perfectly combining global expertise with local knowledge, we are India's life insurance specialist. Max New York Life believes that for knowledge to be of value it must be focused, current, tested and shared. Integrity: Integrity is the cornerstone of any ethical deed. Adhering to the professional code of conduct and adherence to processes and systems is of utmost importance. Teamwork: Teamwork implies the ability to share exchange and provide information and support team members which is at the core of any successful venture. Selflessly putting the team interest above personal agenda enables the company to perform better in every aspect.

Navnirman Institute Of Management

Page 8

Max New York Life Insurance


1.2.3 Products offered by Max New York Life Insurance 1.2.3.1 PROTECTION PLANS
Max New York Life Platinum Protect Max New York Lifes Platinum Protect is a comprehensive life insurance plan that fulfills the protection needs for you and your family. It is a unique plan that supports your family's financial requirements in case of your absence. Max New York Life's Platinum Protect is the best solution for you to fulfil all your family's dreams, no matter what. Benefits:

Comprehensive Insurance cover at affordable rates Low Premium rates for leading a healthy life style Premium discounts for high sum assured Life Cover continues even if you stop paying premium Riders to protect your family from death, disease, and disability Comprehensive medical report at the time of policy issuance

Key Features: Death Benefit: An amount equal to Sum Assured will be paid to the nominee in case of death of the Life Assured.

Navnirman Institute Of Management

Page 9

Max New York Life Insurance


Max New York Life Premium Return Term Plan

Your family is the center of your world. You care for your loved ones more than anyone else does and you definitely have hopes and aspirations for them. On the other hand, your loved ones look up to you for everything at every step of their lives - from the smallest necessities to the biggest needs. You want to provide them with the best of everything, from education to marriage to healthcare and financial support for household expenses, EMIs, rent, etc. We all know that life is full of uncertainties, and we never know what lies ahead of us in the future. Therefore, it is critical to secure the future of our loved ones and provide for them, whether we are there with them or not. This is exactly what Max New York Life Premium Return Term Plan (UIN 104N069V01) will help you do!

Unlike the regular term plans, the Max New York Life Premium Return Term Plan not only offers protection to your family in case of an eventuality, but also returns your money at the end of the term so that your family enjoys a secure future Benefits:

Comprehensive protection along with inbuilt accidental death benefit : This plan offers base sum assured as death benefit and 50% of base sum assured as an inbuilt accidental death benefit.

Return of premiums : On survival on maturity date, you get 100% of your premiums back.

Navnirman Institute Of Management

Page 10

Max New York Life Insurance


1.2.3.2 CHILD PLANS

Max New York Life Shiksha Plus II

The needs of children go much beyond securing admissions in the best schools and exploring opportunities for education. Max New York Life Shiksha Plus II understands this and has designed a plan to ensure that your children not just get the best of education but also explore and develop their hidden talents. Key Features: Immediate Family Support: 100% of applicable Sum Assured is paid immediately in the event of death of Life Assured. This ensures that the child doesn't have to depend on anybody else in your absence. University Education Pool: Upon policy maturity, the prevailing Fund Value is paid out to take care of higher education expenses of your child. It is calculated as (Accumulated Units x prevailing NAV). University Education Support: In the event of death of Life Assured, all future premiums are funded by us to boost the University Fund corpus and protect the childs dreams of studying in an university of his/her choice. School Fee Support: 10% of Sum assured will be paid immediately along with Immediate Family support. From the next policy anniversary following the date of death, 10% of the base sum assured will be paid on each policy anniversary to provide for school expenses subject to a maximum of 100% of the base sum assured but not beyond the original term of policy.
Page 11

Navnirman Institute Of Management

Max New York Life Insurance


Max New York Life College plan So, start planning for your child's college education with Max New York Life College Plan - a traditional participating, money back life insurance plan. Key Features: Living and maturity benefit: The total payout is 120% of Sum Assured. There are guaranteed cash backs every year from child's age 18 to 21. Child's age 18 19 20 Money back (% of Sum Assured) 40% 20% 20% 40% + (Accrued Reversionary Bonus + Terminal Bonus, if any)

21

Therefore, total guaranteed money back/payout is 120% of Sum Assured. Bonus:

Reversionary Bonus: Bonus option in this plan is compound reversionary bonus*. Reversionary bonus is declared from 2nd policy year onwards and once declared is guaranteed for the life of the contract. The bonus is a percentage of the base Sum Assured.

Terminal Bonus: Terminal bonus may be declared after the 10th policy anniversary as a percentage of Reversionary Bonus and is payable only once during the policy lifetime. *Compound Reversionary Bonus means that the previously declared bonuses will also participate in successive bonus declarations.

Navnirman Institute Of Management

Page 12

Max New York Life Insurance


Death Benefit: Upon death of Life Assured before attaining 7 years of age, total premiums paid (with interest @ 3.5% p.a. compounded annually) and accrued reversionary bonus, if any, is paid. Upon death of Life Assured after attaining 7 years of age, Sum Assured + Accrued Reversionary Bonuses + Terminal Bonus, (if any), is paid.

Navnirman Institute Of Management

Page 13

Max New York Life Insurance


1.2.3.3 RETIREMENT PLANS
Life partner plus plan Max New York Life's Life Partner Plus is a life insurance plan that provides you protection for life and simplifies your financial planning and investment needs. This plan offers you triple benefits. It gives you maturity benefits at the age of 75, provides you a life coverage insurance and offers you money back feature as well, where we will pay you a part of the sum assured at regular intervals to take care of your periodic foreseen needs from age 61 to 75, ensuring that you can fulfill all your dreams and have a carefree retirement. So enjoy your golden years with pride and independence. Benefits:

Guaranteed financial protection Guaranteed money backs for 15 years Additional protection through various riders Bonus declared every year from 3rd policy year onwards

Key Features: Living Benefit: Guaranteed returns of 7.5% of Sum Assured will be paid on each policy anniversary from age 61 to 75. 100% of Sum Assured will be paid on policy maturity together with paid-up additions, if any. Death Benefit: An amount equal to initial Sum Assured with sum assured of paid up additions added through bonuses, (if any), will be paid in case of death of the Life Assured. If death occurs before life insured reaches age 10 the company will refund all the premiums paid along with interest rate of 3% per annum, subject to a maximum of the sum assured chosen.

Navnirman Institute Of Management

Page 14

Max New York Life Insurance


1.2.3.4 Growth plans
Max New York Life Flexi Fortune Max New York Life Flexi Fortune, a unit-linked life insurance plan offers the advantage of protection with returns. Max New York Lifes Flexi Fortune allows you to customize your plan as per your requirements, investment choices, and type of cover. Key features Key Features:

Flexibility to choose your own life cover, policy tenure, investment strategy, and premium payment term.

Protection against market volatility with the Systematic Transfer Plan (STP). Progressively increasing sum assured for increasing liabilities without additional underwriting.

Flexibility to make partial withdrawals to meet any unplanned expenses. Flexibility to opt for additional protection by choosing rider options - Personal Accidental Benefit (PAB) rider and Dread Disease (DD) rider.

Benefits: Maturity Benefit: Upon maturity, policyholder is eligible to an amount equal to Fund Value.

Fund Value = Accumulated Units X Prevailing NAV on maturity date Death Benefit: Upon death of the life insured before prior to maturity of policy, an amount equal to Sum Assured + Fund Value on date of death will be paid to the nominee.

Navnirman Institute Of Management

Page 15

Max New York Life Insurance


Max New York Life fast track plan You are at a stage where you have planned for most of the major responsibilities of your life. At the initial stages of life you have ensured that your family, your children, have been provided for. Now is the time to put your life on the Fast Track. You want to maximize your savings, enabling you to lead a relaxed lifestyle where you can live life to the fullest and focus on fulfilling your wishes, and realizing your own dreams. But you need to be prepared financially to ensure that your future years are the best years of your life. Key features

Life insurance coverage Option of short premium payment terms enabling an early maturity and fast track accumulation

Choice of six well managed funds for investors with different risk appetite Entry age of life insured upto 60 years Choice of protection cover basis age of life insured Systematic Investment through STP option- to safeguard your wealth against market volatilities

Flexibility to make partial withdrawals to meet unplanned expenses Flexibility to opt for Personal Accidental Benefit and Dread Disease rider

Navnirman Institute Of Management

Page 16

Max New York Life Insurance


1.2.3.5 Savings plans
Max New York Life Life Gain Plus 20 Max New York Life Life Gain Plus 20 Participating Plan requires you to pay premiums only over a limited period, while you get cover for the entire policy tenure, i.e., up to 20 years. It ensure growth of your money resulting in a substantial lump sum on maturity. Bonuses and terminal illness benefit along with the flexibility to add value to your plan with various rider options makes it an ideal plan for achieving your financial goals. Key features Benefits:

Guaranteed financial protection Flexibility to choose premium payment term Additional protection through riders

Maturity Benefit: On maturity of the policy, this plan provides 110 % of the Sum Assured and paid-up additions, if any. Death Benefit: On death of the Life Assured, the following benefits are payable:

100% of the Sum Assured + Sum Assured of paid-up additions, if any (if policy is in force for less than 5 years)

200% of the Sum Assured + Sum Assured of paid-up additions, if any (if policy is in force for 5 years or more)

On death before 10 (ten) years of age, this plan gives a refund of premiums with compound interest at the rate of 4 (four) percent subject to maximum of sum assured.

Navnirman Institute Of Management

Page 17

Max New York Life Insurance


Terminal Illness Benefit: On diagnosis of a terminal illness with a life expectancy of six months or less, the Life Assured will get:

Up to 50 % of Sum Assured (subject to a maximum of Rs. 5,00,000)

Remainder of Sum Assured on the occurrence of the insured event

Max New York Life Whole Life Max New York Life Whole Life Participating Plan is designed to provide you a lifetime of security along with potentially higher returns. The plan builds a Cash Surrender Value, which can be used to fund your sudden monetary requirements. In addition, you are eligible for bonuses 3 years after the policy comes into effect. Key features Benefits:

Protection for life with a guarantee of basic amount insured Cash Surrender Value after 3 years premiums have been paid Bonus declared every year after 3 policy years Insurance cover up to age 100 Option for additional protection through riders Guaranteed fixed premium throughout life, which allows you to plan your finances better

Bonus options: The plan entitles you to get bonuses with a choice of three options on how you would want it paid to you:

Cash bonuses: The bonuses will be paid to the Policyholder in cash.

Navnirman Institute Of Management

Page 18

Max New York Life Insurance


Premium offset: Bonus may be used to offset the premium due. Purchase Paid Up Additions: The Bonuses may be used to buy paid-up additions.

Maturity benefit: Upon maturity, amount equal to Sum Assured along with accrued bonuses, (if any), is payable. Death benefit:

On death of Life Insured upon attaining ten (10) years of age, an amount equal to Sum Assured along with Sum Assured of paid-up additions, if any, is payable

On death of the Life Insured before attaining ten (10) years of age, we will refund all the premiums received by us together with interest at the rate of four (4) percent per annum, compounded annually, subject to maximum of Sum Insured.

Navnirman Institute Of Management

Page 19

Max New York Life Insurance


Max New York Life GMI PLAN Future needs to be planned. Planning for future requires planning for future income. To be able to guarantee future income is to guarantee your childs education, your retirement or any other financial goal that you have set. For complete peace of mind this income should be guaranteed and not subject to swings of markets. But how do you go about securing such an income? Max New York Life brings to you a solution that takes care of all your worries. The Guaranteed Monthly Income plan not just ensures safety of your investments but also ensures that your savings are cushioned from ill-effects of inflation. Additionally it ensures that the lifestyle of your family is protected against any exigencies. Key features Benefits:

Short

Policy

Terms

The plan offers you flexibility to choose your policy terms. You can choose either 6 years or 11 -year policy terms depending on your financial goals.

Guaranteed Monthly Income for a Payout Period of 10 years after your policy term The plan lets you choose the guaranteed monthly income you desire. This income is guaranteed to be paid for a period of 10 years (120 months) from the end of policy term, payable at payout dates*.

Monthly

Income

Boosters

("MIB")

12th

year

onwards

Over and above the guaranteed monthly income, the plan also offers MIB starting year 12, which are payable at payout dates. This ensures that your chosen monthly income is cushioned against inflation.

Complete

Safety

of

your

investments

and

transparency

of

returns

The investments will be made only in highly secure investments ensuring minimal risk and low volatility. A single Monthly Income Booster (MIB) rate is applied to renewal premiums received on all policies within a particular month. The MIB rate will be determined using the prevailing 5-year Government Security Benchmark Interest Rate as

Navnirman Institute Of Management

Page 20

Max New York Life Insurance


on the last working day (end of day) of the previous month, obtained from Fixed Income Money Market and Derivatives Association of India (FIMMDA). Monthly Income Boosters (MIB): From Policy Year 2 onwards, upon receipt of each due premium, the policy will accrue Monthly Income Boosters till the end of policy term. For the purpose of applying Monthly Income Booster rates for renewal premiums received on policies, all the premiums received within a particular month will be applied a Monthly Income Booster Rate corresponding to FIMMDA 5Year Government Security Benchmark Rate as on the last working day (end of day) of the previous month. Guaranteed Terminal Benefit For the 6-year variant, 150% of annual premium will be paid along with last guaranteed monthly income payment and for the 11-year variant, 200% of annual premium will be paid along with last guaranteed monthly income payment. Death Benefit

Death event before end of Policy Term/Premium Payment Term


o

All premiums paid by the policyholder prior to date of death are immediately paid to the Nominee.

The Nominee will receive Guaranteed Monthly Income ("GMI") payable at payout date of every month from the Policy Anniversary following the date of intimation of death till the end of Policy Term.

The Nominee will receive GMI along with Monthly Income Booster (MIB) as and when due during the Payout Period.

o o

Guaranteed Terminal Benefit at the end of Payout Period. MNYL will fund the remaining premiums on behalf of the policyholder.

Death event After Policy Term/Payout Period


o

Guaranteed Monthly Income (GMI) along with Monthly Income Booster (MIB) will be paid as and when due for the outstanding Payout Period.

Navnirman Institute Of Management

Page 21

Max New York Life Insurance


1.2.3.6 Health plans
Max New York Life Lifeline - MediCash Plus Our health insurance plans act as an intermediary in safeguarding your peace of mind and eliminating all worries about your present and future medical expenses. Max New York Life Lifeline - MediCash PlusTM is a health insurance plan that provides you with cash benefit till you completely recover from your illness. With this plan, you get fixed cash benefit towards hospitalization, ICU and recuperation (post-hospitalization), which will lessen your monetary burden in an already difficult situation. Key features Multiple claims and cashless hospitalisation:

Cashless hospitalisation and cash benefit is available in over 4000+ network hospitals across the country irrespective of actual billing.

In case you are hospitalized in a hospital outside our network, submit your bills, discharge summary, etc and the amount will be reimbursed after assessment.

Premium guarantee: The premiums are guaranteed / fixed for 5 years from the effective date. After 5 years, the premium rates may be revised after reviewing the claims experience subject to prior approval of IRDA. Other benefits:

Guaranteed long term coverage for 10 years subject to premium payments made by you and termination provisions

You may be entitled to certain tax benefits on your premiums and benefits. Please note all the tax benefits are subject to tax laws prevailing at the time of payment of Premium or receipt of benefits by you.

Navnirman Institute Of Management

Page 22

Max New York Life Insurance


Benefits Hospital Cash Benefits: In case of an unfortunate event of your being hospitalized for a medically necessary treatment or surgery for any illness or injury, for a continuous and consecutive period of at least 48 hours, the company shall pay fixed per diem benefit as per the unit/ scale of benefit applicable, for the period of hospitalization but excluding the first 24 hours of such hospitalization and subject to limits of the policy. This is a fixed amount paid irrespective of your actual hospital bill. In scenarios, when you are hospitalized again for the same illness or injury that occurred during previous hospitalization, within 30 days from the date of discharge, we will pay from the first 24 hours of such hospitalization. ICU Cash Benefit: In case of your being required to and is admitted into an intensive care unit for a medically necessary treatment or surgery of any illness or injury for a continuous period of 8 hours or more during hospitalization for a continuous period of 24 hours or more, in addition to hospital cash benefit, an intensive care unit cash benefit equivalent to 200% of hospital cash benefit will be payable on per diem basis as per the unit/ scale of benefit subject to the terms and conditions of the policy. Recuperating Benefits: Expenses don't stop at hospital discharge, do they? LifeLine - MediCash PlusTM also offers a fixed lump sum recuperation cash benefit to help you meet your follow-up investigation costs, consultation fees, cost of medicines etc. Provided there has been a continuous and consecutive period of hospitalization of 7 days or more and is discharged alive from the hospital. Then in addition to hospital cash and ICU cash benefit,

Navnirman Institute Of Management

Page 23

Max New York Life Insurance


a lump sum recuperating cash benefit equivalent to 300% of the hospital cash benefit will be payable as per the unit/ scale of benefit. Surgical Cash Benefit: Over and above routine hospitalization expenses, a fixed Lump-sum amount will be paid under LifeLine - MediCash PlusTM for more than 400 listed surgeries that you may undergo. These surgeries are divided into 5 categories depending on clinical severity. Accordingly a certain percentage of the maximum benefit will be paid out for a surgery undergone by you. We also understand that cost of medical facilities is rising year by year. To partner with you in attempting to meet them, our surgical cash benefit will increase every year at a simple rate of 5% of the benefit amount at policy inception. Total amount of Surgical Cash Benefit that can be availed throughout the policy term will be twice the applicable benefit amount for that particular year surgical cash benefit for a few surgeries is payable for few covered surgeries carried out in the first 90 days of the effective date and few covered surgeries carried out in the first 24 months of the effective date except where the surgery is carried out for treatment of an injury. List of such surgeries can be provided on demand.

Navnirman Institute Of Management

Page 24

Max New York Life Insurance


Max New York Life LifeLine Wellness Plus plan Max New York Life LifeLine Wellness Plus plan brings to you the advantage of a 360 benefit plan. With medical expenses rising constantly, it is vital to protect yourself financially against unforeseen events. Max New York Lifes LifeLine Wellness Plus plan provides coverage for a wide variety of diseases and conditions, allowing you to live your life peacefully. Key features Critical Illness Coverage: Covers 38 critical illnesses / conditions and offers up to 100% of the Sum Assured with a maximum limit of Rs. 20 Lacs. Term Period: Premiums can be paid for a chosen period of term of 10, 15 or 20 years as per your needs. Benefits: You can choose any unit from 1 to 10 as your insurance coverage at the time of buying the insurance. With Max New York Lifes LifeLine Wellness Plus plan, the scale of benefits is drawn as below:

Navnirman Institute Of Management

Page 25

Max New York Life Insurance


Max New York Lifes LifeLine-Safety Net Max New York Lifes LifeLine-Safety Net is a non -linked and non- participating term cum health insurance plan that offers complete all round financial protection for you and your family. It gives you an opportunity to live your life peacefully as it covers all your health needs under a single plan at affordable rates. So choose Max New York Lifes LifeLine-Safety Net plan and enjoy the best healthcare protection Key features Critical Illness Benefit:

On the diagnosis of any of the critical illnesses (Cancer, Coma, Kidney failure, Multiple sclerosis, Heart attack, Paralysis/paraplegia and Stroke) Or

On the actual undergoing of the surgery of Major organ transplant, Coronary artery, bypass surgery, Heart valve surgery, the company shall advance 50% of the sum assured subject to the survival of the life insured for at least 28 (Twenty Eight) days after the happening of the such insured event. .

Benefits: Death Benefit Equal to the Sum Assured (minimum 6 lakhs and maximum 40 lakhs) subject to deduction of Critical Illness Benefit, if paid any Critical Illness Benefit 50% of the Sum Assured (acceleration of basic death benefit) Total Permanent Disability Accidental Death Benefit Additional benefit of 50% of the Sum Assured Additional benefit of 100% of the Sum Assured

Navnirman Institute Of Management

Page 26

Max New York Life Insurance


1.2.3.7 Group plans
Max Super Life Max Super Life is a group term life solution that provides comprehensive protection against death due to both accidental, non accidental causes. This product is a widely prevalent benefit that helps a group in creating additional social security by means of life insurance for its members. It could be offered to the following groups:

Max Super Life for Employer Employee Group Max Super Life for Affinity Groups Max Super Life in Lieu of Employees' Deposit Linked Insurance (EDLI) Scheme

Group traditional gratuity Group Credit Life Insurance is a reducing term cover. The sum insured can be linked to the loan repayment schedule; which means the insured member will get covered for outstanding loan liability (as per the schedule) by payment of applicable premium. As per the Gratuity Act of 1972, any establishment with at least 10 employees has a statutory liability for payment of gratuity at a minimum of 15 days of last drawn basic salary + DA, for every completed year of service subject to a maximum of Rs. 10 Lacs under the following circumstances under -:

On normal / early retirement / resignation (Completion of 5 Years is applicable) On his death, disablement due to an accident or disease (Completion of 5 years is not applicable)

Employers can provide more than 10 Lacs of benefit as the act does not curtail them to provide better benefits for their employees

On his / her Superannuation

Navnirman Institute Of Management

Page 27

Max New York Life Insurance


Group Credit Life Group Credit Life Protects the Credit portfolio of the bank or any institution which grants loans, by insuring the debt given to the borrower. Let us explore some of the reasons why should life insurance be given while giving credit to the borrower -: Most of the financial institutions in the business of lending create provisions for the borrowers to address scenarios' like loss of income due to disability or loss of job and protect death due to accidental causes. However this provision is not complete as the lending institutions today have various options to ensure borrowers convenience to pay for the mortgage, like, by extending the mortgage schedule or mortgage payment deferment and by doing so, the lending institution also makes profit through additional interest earnings. Besides the cover provided through these products is not comprehensive for the borrower, due to many fine print conditions and clauses that make the claim settlement difficult and thus nullifying the purpose of insurance to cover the mortgage liability. In comparison to any of the above bundle insurance products, Life insurance is a wholistic solution that covers the borrowers liability without any fine print exclusions and conditions, in the event of death due to both accidental and non accidental 0r natural causes. The financial institution with the advantage of a group platform can extend the benefits of life insurance cover not only to their entire term loan product line from home, financial and personal loans, but can also look at extending it to other products like deposits & other Para banking solutions. While innovative Insurance solutions could be created for the benefit of the customer, the cost and administrative benefits and the flexibility at a group platform could be enjoyed by both the financial institution & customer.

Navnirman Institute Of Management

Page 28

Max New York Life Insurance 2.1 Service


A service is any act or performance that one party can offer to another party ..i.e. essentially intangible and does not result in the ownership of any of the factor of production. Its production may be tied to a physical product.

2.1.1Characteristics of service: Intangibility: services are intangible in nature unlike tangible products insurance service cannot be seen, touch or senced but its services and utility can be felt. Inseparability: Service are typically produced and consumed simultaneously. This is not true of physical goods, which are manufactured, put into inventory, distributed through multiple agencies and consumed later. If a person renders the service then the providers is a part of service, because the client is also present as the service is produced, providerclient interaction is a special feature of service marketing. Both provider and client affect the outcomes several strategies exit for getting around the shortage of time problem. The service provider can learnt to work larger groups. The service provider can learn to faster. The service organization can trained more service providers and build up client confidence. Variability: because the services depends on who provides them and where they are provided services are highly performing ascertaining operations, other are less successful. Service firm can take three steps towards quality control: 1. Investing in insurance hiring and training advisers. 2. Standard dizing the service performance process throughout the organizations. 3. Monitoring customer satisfaction through suggestion and complaint system, customer surveys and comparison in investment. Perishability : services cannot be started. The perishability of services is not a problem when demand is steady. When demand fluctuates, service firms have problem for example : public transportations companies have to own much more equipments because of rush-hours demand than if demand were even throughout the day.

Navnirman Institute Of Management

Page 29

Max New York Life Insurance


2.2 What is service Gap?
The difference between what customer expected and what they perceived was delivered we have adopted and extended their framework to identify a total of seven types of gaps that can occur at different point during the design and delivery of a service performance. Service gap It is defined as the difference between what the customer was expecting and what is being delivered. Service gap is the difference between what customer expected and what they perceived was delivered.

2.2.1 Service performance


Performance indicates the response time of the service as experienced by the and user. There are three types of service performance matrics Effectiveness matrics: For eg number of error-free order or bills processed the number of customers giving you are excellent rating. Capability matrics: For eg the mean rating of attributes of service like friendliness of greeting, service time, service knowledge about, service features etc. Efficiency matrics: For eg the average utilization of manpower, average time spent on reworking of fault service , average overtime, in a period etc.

Navnirman Institute Of Management

Page 30

Max New York Life Insurance


2.3 Service Qaulity
The service is defined as A set of quality requiremqnts on the collective behavior of one or more objects. The 10 criteria that customer rely on while evaluating the service quality Reliability Access Security Credibility Degree of customer understanding Responsibleness Competence Courtesy Tangibles Communication

Navnirman Institute Of Management

Page 31

Max New York Life Insurance


2.3.1 Types of service gap
1. Knowledge gap: Difference between what service provider believe customer expect and customer actual needs and expectation

2. Standards gap: Difference between managements perceptions of customer expectations and the quality standards established for service delivery.

3. Delivery gap: Difference between specified delivery standards and the service providers actual performance on these standards.

4. Internal communication gap: Difference between what the companys advertising and sales personnel think are the products features, performance, and service quality level and what the company is actually able to deliver.

5. Perceptions gap: Difference between what is, in fact, delivered and what customers perceive they have received.

6. Interpretation gap: Difference between what a service providers communication efforts promise and what a customer thinks was promised by these communications.

Navnirman Institute Of Management

Page 32

Max New York Life Insurance

Navnirman Institute Of Management

Page 33

Max New York Life Insurance


3.1 Main Objectives:
The main objective of preparing this report is to compare the difference between perceived quality and service provided by Max New York Life Insurance company Ltd in surat city and to know the public awareness regarding life insurance and their knowledge, attitude, and preference towards various insurance policies and investments. 3.2 Sub-objectives: Proper understanding and analysis of life insurance industry. To know why one has to invest in life insurance. To know the Preferences of the customers. Current trends life insurance in the Indian market. Customers expectation from the service providers. Different views of professional advisors. To know about brand preference about Max New York Life Insurance and consumers preference about Max New York Life Insurance. Conduct market survey on a sample selected from the entire population and derived opinion on that research.

3.3 Nature of Research: There are two types of research: 1. Basic Research 2. Applied Research

I am comparing GAP Between perceived quality and service provided by Max New York Life Insurance and I am doing basic research.

Navnirman Institute Of Management

Page 34

Max New York Life Insurance


3.4 Scope of research:

The survey helps Max New York Life insurance company to analyse the customer expectation from the company regarding service provided by them. It also helps in knowing consumer preference and attitude towards various investment option and help manager in framing policy and deciding strategies. It helps to know about savings and investment by public and various investments option and to know the financial condition and scope of insurance market.

3.5 Data collection:

There are two methods to collect the data: 1. Primary data 2. Secondary data

This report is based on primary data. Research has been done by primary data collection, and primary data has been collected by interacting with various people.

3.6 Data collection Time Period :

The time period for the research is from January begining up to february Beginning.

Navnirman Institute Of Management

Page 35

Max New York Life Insurance


3.7 Sampling: i) Sample Size: I have conducting a survey a sample size of 100 people and it is selected randomly without any bias.

ii) Sampling Frame I have conducted our survey in Surat City. iii.) Sample Element I am conducting service gap between perceived quality and service provided by Max New York Life insurance company so for this my element is its customers.

iv).

Sampling Method

There are two types of sampling methods: 1) Probability sampling method 2) Non- Probability sampling method

I have adopted Non- Probability sampling method as our method and in Non- Probability sampling method I have adopted Convenience Sampling for our survey.

Navnirman Institute Of Management

Page 36

Max New York Life Insurance


v.) Survey Tool & Method

A brief questionnaire is prepared for conducting a survey this question are prepared on the base of study and results and properly analyzed. There are four types of survey methods: 1) Telephonic Interview 2) Mail Interview 3) Personal Interview 4) Electronic Interview

I have used Personal Interview method to do the survey. 3.8 Response Rate: The rate of response of sample population is good most of them are familiar with this investment option and we can say that our response rate is 100%.

3.9Pilot Survey: We have conducted a pilot survey and our questionnaire was passed in pilot survey. There was no correction require in our questionnaire.

3.10 Limitations of the Study: The major limitation was unwillingness of respondents to reveal information. Due to lack of sufficient time and hesitation to reveal information regarding their investments, it was a difficult task to extract information from them. Sample size was also small i.e. 100. Therefore, it is very difficult to infer correct conclusions from small sample.

Navnirman Institute Of Management

Page 37

Max New York Life Insurance Data analysis


Q.1) Have you purchased any policy from Max New York Life Insurance?

Ans code

Option

No response

of

1 2

Yes No Chart 1

100 0

No of response
120 100 80 60 40 20 0 Yes 1 No 2 No of response

Table 1

Interpretation : The people surveyed were all customers of max new York life insurance company as they all had purchased policy of the company.

Navnirman Institute Of Management

Page 38

Max New York Life Insurance


Q.2) From where do you come to know about Max New York Life Insurance?

Ans code 1 2 3 4

Option Advertisement Hoarding Insurance agent

No of response 41 25 16

Percentage 41 25 16 15

Friend, relative or 15 family member

Any other, please 1 specify Chart 2

No of response
45 40 35 30 25 20 15 10 5 0 Advertisement Hoarding Insurance agent Friend, relative Any other, please or family specify member 3 4 5

TABLE 2

Interpretation: From the survey we found out that maximum people were aware of Max New York Life Insurance Company through advertisement and hording. Company needs to advertise more in order to be recognize by people.

Navnirman Institute Of Management

Page 39

Max New York Life Insurance


Q.3) Rank the following features according to your choice? Ans code 1 Option Mean Rank 3

Goodwill of the 2.89 company

Good return

rate

of 2.21

Service provided 1.44 by the company

Advice by others Chart 3

3.39

Rank
Rank 4 3 2 1

Goodwill of the company 1

Good rate of return Service provided by the company 2 3

Advice by others 4

Table 3

Interpretation: The cusromers choose service provided by the company as their fisrt preference ahead of good return and goodwill of the company. While good rate of return was their second prefence and goodwill of the company was third.

Navnirman Institute Of Management

Page 40

Max New York Life Insurance


Q.4) In Which plan you have invested ? Ans code 1 2 3 4 5 6 7 Protection plan Child plan Retirement plan Growth plan Savings plan Health plan Group plan Chart 4 Option No response 37 32 19 24 35 41 12 of Percentage

45 40 35 30 25 20 15 10 5 0 No of response 1 Protection plan 2 Child plan 3 Retirement plan 4 Growth plan 5 Savings plan 6 Health plan 7 Group plan

Table 4

Interpretation: From the survey I found out that most of the people invested in health and life insurance. There is moderate growth among those people investing in child and savings plan.

Navnirman Institute Of Management

Page 41

Max New York Life Insurance


Q.5) Are you updated with New Schemes of Max New York Life Insurance ? Ans code Option No response 1 2 Yes No Chart 5 69 31 69 31 of Percentage

No of response

31% 1 Yes 2 No

69%

Table 5

Interpretation: From the survey it can be seen that majority of the people are updated with new schemes of the company.

Navnirman Institute Of Management

Page 42

Max New York Life Insurance


Q.6) Mention the quality for below services in Max New York Life Insurance ?

Service Employee behaviour Premium plan Loyalty New schemes Total

Excellent 12

Good 29

Satisfactory 46

Poor 13

Total 100

31 20 35 98

37 41 41 138 Chart 6

27 31 10 114

5 8 14 40

100 100 100 400

50 45 40 35 30 25 20 15 10 5 0 Excellent Good Satisfactory Poor Employee behaviour Premium plan Loyalty New schemes

Table 6 Interpretation: From the survey it is found that majority of the customers were satisfied with the employees behaviuor as well as they like the schemes of the company and they felt that premium plan were good for them.

Navnirman Institute Of Management

Page 43

Max New York Life Insurance


Q.7) Do you get regular updates of premium payment from the company?

Ans code

Option

No response

of Percentage

1 2

Yes No

72 18 Chart 7

72 18

Table 7

No of response

1 Yes 2 No

Chart 7

Interpretation: From the survey we found that 72% of the customers were getting regular updates regarding premium payment. In insurance industry it is very important to keep customers updated with their investment and policies.

Navnirman Institute Of Management

Page 44

Max New York Life Insurance


Q.8) How is the behaviour of employees towards you?

Ans code

Option

No

of Percentage

response 1 2 3 4 Excellent Good Average Not bad Table 8 37 14 41 8 37 14 41 8

No of response
45 40 35 30 25 20 15 10 5 0 Excellent 1 Good 2 Average 3 Not bad 4

No of response

Chart 8 Interpretation: From the survey it is seen that 37 % of customers were happy with employees behavior with them while 41% found it very ordinary. Where as 14% of people found it good. In any service providing company it is very important for employees to maintain good behavior in order to retain customers.

Navnirman Institute Of Management

Page 45

Max New York Life Insurance


Q.9) Are you satisfied with the service that you received ?

Ans code

Option

No response

of Percentage

1 2 3 4 5

Highly Satisfied Satisfied Neutral Dissatisfied Highly Dissatisfied

12 55 19 9 5

12 55 19 9 5

Table 9

No of response
No of response

55 12 Highly Satisfied 1 Satisfied 2 19 Neutral 3 9 Dissatisfied 4 5 Highly Dissatisfied 5

Chart 9

Interpretation: From the survey we can say that 55% of the employees were satisfied with the service they received and less than 10% were not satisfied.

Navnirman Institute Of Management

Page 46

Max New York Life Insurance


Q.10) Have you ever any problem or complain for Max New York Life Insurance ?

Ans code

Option

No response

of Percentage

1 2

Yes No Chart 10

54 46

54 46

No of response
56 54 52 50 48 46 44 42 Yes 1 No 2 No of response

Table 10

Interpretation: From the survey it was found that 46% of respondents had no complaint against company while 54% respondents had their complaints. The 54% respondents shared their conplaints regarding various reason in the following question. This results shows the shortfalls of the company and give chance to improve them

Navnirman Institute Of Management

Page 47

Max New York Life Insurance


Q.11) If yes ,related to Ans code Option No response 1 2 3 4 Product Premium Service Other 16 15 11 2 Chart 11 29 28 20 4 of Percentage

Percentage of Response
35 30 25 20 15 10 5 0 Product 1 Premium 2 Service 3 Other 4 Percentage

Chart 11

Interpretation:From the survey it was found that 54% of customers had complaints out of which 20% of the complains were related to the service provided to them. And 29% of customers had complaints regarding policies of the company while 28% of customers had problem regarding premium payment.

Navnirman Institute Of Management

Page 48

Max New York Life Insurance


Q.12) Have your problems(s) were heard and solved by respective company authorities?

Ans code

Option

No response

of Percentage

1 2

Yes No Table 12

91 9

91 9

No of response

1 Yes 2 No

Chart 12

Interpretation: from the survey we found that 91% of the problems were solved by the authorities.

Navnirman Institute Of Management

Page 49

Max New York Life Insurance


Q.13) Rate the standard of the advisor? Ans code Option No response 1 2 3 4 excellent good satisfactory poor 29 38 20 13 Table 13 29 38 20 13 of Percentage

No of response
40 35 30 25 20 15 10 5 0 excellent 1 good 2 satisfactory 3 poor 4 No of response

Chart 13

Interpretation: from the survey we found that the standard of advisor is found ood by majority of the people.

Navnirman Institute Of Management

Page 50

Max New York Life Insurance


Q.14) Will you recommend Max New York Life Insurance to other

Ans code

Option

No

of Percentage

response 1 2 Yes No 68 32 Table 14 68 32

No of response
70 60 50 40 30 20 10 0 Yes 1 No 2

No of response

Chart 14

Interpretation: from the survey we found 68% customers are willing to recommend it to the other people.

Navnirman Institute Of Management

Page 51

Max New York Life Insurance 5. Findings


From the above survey the following results were found. Max New York Life Insurance is one of the biggest company in the private insurance market and has wide range of policies. There is lot to offer to the customers by the company. Advertisement is one of the biggest marketing tool to create awareness among people about the company. Max New York Life Insurance Company has used this tool very effectively as maximum of their customers came to about the company through advertisement. In insurance market customers give equal importance to service quality of the company than rate of return on their investment. As it is very necessary to maintain customers trust that their investment is in safe hands and will be return to them when they will need. There is a rapid increase in the people investing in life insurance as well as in other schemes life retirement plan, health plan, child plan etc. Thus it very important to offer various range of policies to the customers as per their requirement. The insurance market has increase grown to 23 thousand crore market in 2011. Insurance business depends upon timely payment of premium by them so it very necessary to give updates of when and how much premium is to be paid. Max New York Life Insurance Company provides these services to their customers. Of which 72% of customers said they received this service. In order to retain customers behavior of the employees plays important role. Most of the customers of Max New York Life Insurance Company are satisfied with behavior and they are also satisfied the service that they received from the employees. The gap between perceived quality of service and service provided by the company occurs when either consumer expects much more than what is offered ro them or when the company fails to provide the service which was promised by them. In Max New York Life Insurance Company the customers are experiencing the Gap because of high expectation by the customers.

Navnirman Institute Of Management

Page 52

Max New York Life Insurance


6.1 Recommendations
The study has provided with the useful data from the respomdents. There is lot to be recommended. Following are the recommendations: There is a need for better promotions for the investment products and services. The company should advertise its products through television because it will reach to the masses. More returns should be provided on Insuarnce plans. Policies should be easy to understand by the common man as when they have proper information it will create good effect on the customers. There should be guaranteed return with minimum risk of investment. The customers should be provided with extra services like reminder of paying premium, they should be aware how much premium is to be paid. Personnel should be properly trained to understand the customers problem and try to solve it as early as possible. Customers griveinces should be solved as soos as possible.

As the company provides various facilities to its customers. It should be made clear that they get maximum benefit of the service available to them. They should have choice while selecting a suitable insurance plan. This will definitely add to the goodwill of the company and profit will increase.

Navnirman Institute Of Management

Page 53

Max New York Life Insurance


6.2 Conclusion
After overhauling the all situation that boosted a number of Pvt. Companies associated with multinational in the Insurance sector to give benifitting competition to the established behemoth to Max New York Life Insurance ltd, I come at the conclusion that There is very tough competitions among the private insurance companies on the level of new trend of advertising to lull a major part of customers. Max New York Life Insurance ltd left behind in the present race of advertisement. Max New York Life Insurance ltd has vast market and very firm grip on its traditional customers.

IRDA is also playing very comprehensive role by regulating norms mandating to private players in this sector, that increases the confidence level of the customers to the private players.

Navnirman Institute Of Management

Page 54