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  1. 1. SUMMER TRAINING PROJECT REPORT ON<br />“EFFECTIVENESS OF RECRUITING LIFE ADVISOR IN GENERATING SALES”<br />For<br />AEGON RELIGARE LIFE INSURANCE CO. LTD<br />BHUBANESWAR<br />FOR THE PARTIAL FULFILLMENT OF THE REQUIREMENT<br />FOR THE AWARD OF POST GRADUATE DIPLOMA IN BUSINESS MANAGEMENT (INTERNATIONAL BUSINESS)<br />UNDER THE GUIDANCE OF:<br /> MR. S .N Biswas <br />UNDER THE SUPERVISION OF: <br />Sheikh Rihan Ullah<br />SUBMITTED BY:<br />Prashant Jain<br /> PGDBM(IB) 2008-10<br /> <br />INDIAN INSTITUE OF TRAVEL AND TOURISM MANAGEMENT<br />MİNİSTRY OF TOURISM , GOVT. OF INDİA<br />Bhubaneswar (ORISSA.)<br /> CONTENTS<br />CERTIFICATE ------------------------------------------------------ <br />Acknowledgement------------------------------------------------<br />DECLARATION----------------------------------------------------- <br />PREFACE-------------------------------------------------------------<br />EXECUTIVE SUMMARY----------------------------------------- <br /> <br /> INDEX-----------------------------------------------------------------<br /> <br />CERTIFICATE BY THE ORGANIZATION : <br />This the certify that Mr. PRASHANT JAIN, pursuing PGDM(international<br />business) at Indian Institute of Travel & Tourism Management,<br />Bhubaneswar has worked under my supervision and guidance on his<br />dissertation entitled “EFFECTIVENESS OF RECRUITING LIFE ADVISOR IN<br />GENERATING SALES.” at aegon religare life insurance, bhubanewar<br />from may 15-may-09 to14-jul-09.<br />To the best of my knowledge this is an original piece of work.<br /> <br />Acknowledgement<br />Sometimes words fall short to show gratitude, the same happened with me during this project. The immense help and support received from Aegon religare life insurance overwhelmed me during the project.<br />My sincere gratitude to Mr. Lalit Patnaik (Branch Head, bhubaneswar region, ) and Dr. Adyasha Das (Chairperson, international business, IITTM, Bhubaneswar), for providing me with an opportunity to work with Aegon religare Life Insurence.<br />I am highly indebted to Mr. Shaikh Rihan Ullah, Business Manager ( BM), Aegon religare and company project guide, who has provided me with the necessary information and his valuable suggestion and comments on bringing out this report in the best possible way.<br />I also thank Mr. S N Biswas, faculty guide, IITTM, Bhubaneswar who has sincerely supported me with the valuable insights into the completion of this project.<br />Last but not the least I am grateful to my heartfelt love for my parents, my elder brother Er. ASHWANI JAIN and my friends whose constant support and blessings helped me throughout this project.<br />DECLARATION<br />I, Mr. prashant jain do hereby declare that the project report <br />titled ““EFFECTIVENESS OF RECRUITING LIFE ADVISOR <br />INGENERATING SALES.” is a genuine research work <br />undertaken by me and it has not been published anywhere earlier.<br />Date:<br />Place:- BHUBANESWAR<br /> PRASHANT JAIN<br /> IITTM, Bhubaneswar<br />PREFACE<br />Insurance is a booming sector. Most of the insurance industry works on the concept of recruiting of financial advisors and selling policies through them. In this process the most important aspect is the efficiency of the insurance advisors. For making work through insurance advisors effective it is very important to make them undergo an effective training. This project deals with the importance of training process. Every company incurs huge expenses for training of the advisors. Now it becomes very important to know whether this money is being fruitful or not. My project deals with the training and recruitment process of AEGON RELIGARE life insurance. Every company has its own set of recruitment policies and based on that advisors are selected. In my project I have tried to find out how important is training for an insurance company and how effective it is for the people who are recruited.<br />Executive Summary<br />Monopoly of LIC has been broken to make Indian Insurance to change its face and pace to tap the market and to make the new challenges in it. Insurance in India is not about India only; it is an open sector for the private players. The name which you would see in Indian insurance market is something like: - BAJAJ (Indian company) + Allianz (foreign player), TATA (Indian company) + Aig (foreign player) and so many like them. Companies now are tapping a lot of ways to capture the market and hence adopting different ways to hold the large portion of the market. My project was to understand the different marketing strategies adopted by the companies to increase their market share and along with it meeting their own targets to achieve the position of no.1 in respective field or segment of the market. My summer training learning helped me a lot to complete my project in order to learn a lot of things of the corporate. As a project trainee the first task given to me was to understand the basic behaviour of the consumer in order to manipulate the market according to the our target competition. For this we did developed a questionnaire and I did my survey in important location of Bhubaneswar.<br />INDEX<br />1.INTRODUCTION <br />1.1 Topic<br />1.2 Reason For Selection Of This Topic<br />1.3 Objective<br />1.4 Limitation<br />2. INSURANCE INDUSTRY<br />2.1 Meaning of Insurance<br />2.2 Importance of Insurance<br />2.3 Difference between Insurance and Assurance<br />2.4 Principles of Insurance<br />2.5 History of Insurance<br />2.6 Time line in Insurance history<br />2.7 Meaning of Life Insurance<br />2.8 History of Life Insurance<br />2.9 Key features of Life Insurance<br />2.10 Benefits of Life Insurance<br />2.11 Role of Life Insurance in the growth of economy<br />3 INTRODUCTION TO THE COMPANY<br />3.1 About AegonReligare Life Insurance<br />3.2 Role of IT at AegonReligare Life Insurance<br />3.3 Core Values<br />3.4 Subsidiary Companies<br />3.5 Religare Joint Ventures<br />3.6 Head – Office<br />3.7 Branches<br />4. PRODUCT MIX<br />4.1 Traditional Plans<br />5. HUMAN RESOURCE MANAGEMENT<br />5.1 Recruitment<br />5.2 Selection<br />5.3 Training and Development<br />5.4 Career Development<br />5.5 Communication<br />5.6 Incentives<br />5.7 Services<br />5.8 Performance Appraisal<br />5.9 Organizational form and Structure<br />5.10 Department<br />6. MARKETING DEPARTMENT<br />6.1 Comparative Study<br />7. RESEARCH METHODOLOGY<br />7.1 Objective of the study<br />7.2 Questionnaire<br />7.3 Sampling Method and Sampling Size<br />7.4 Limitations<br />7.5 Analysis of Questionnaire<br />7.6 SWOT Analysis<br /> <br />8. CONLUSION <br />9. APPENDIX<br />10. BIBLIOGRAPHY AND REFRENCES<br />1. INTRODUCTION<br />1.1 TOPIC: <br />At AEGONRELIGARE Life Insurance, I was assigned with the topic as “EFFECTIVENESS OF RECRUITING LIFE ADVISOR IN GENERATING SALES FOR AEGON RELIGARE” for my project work. The selection of the topic was in order to take know how do these companies generates business through them.<br />Life Advisor is those sources of a company who have their own relations and personal contacts among common public that they use to generate business through. Company has certain criteria to recruit these Financial Consultants. The steps are as follows.<br />1.2 REASON FOR SELECTION OF THIS TOPIC: <br />The financial sector is one of the booming and increasing leaps and bounce, some of the experts say only 30% of Indian population is insured which means 70% Indian are not insured and therefore having a bright prospect of progress of this sector where I too would like to build my career and be a part of success story.<br />The Life Advisor are another channel through which the company sales its policy. It is really difficult to convince and sale a single policy but since these advisor have their contacts which they can sale a single policy. Whereas I found my interest in dealing, interacting and handling a team, because all this most of time park you in some critical zone which becomes challenge for you and your responsibility becomes to solve the critical situation or problems. <br /> <br />1.3OBJECTIVE<br /> The main of the present study is accomplish the following objective.<br /><ul><li>The objective behind the project is as follows :
  2. 2. Training aims at recruiting maximum number of life advisors and to sell the maximum policies for the company and bring the business for the company which ever going at the particular point of time.
  3. 3. To find the right candidate.
  4. 4. To about their family background,occupation,social relation,qualification,age.
  5. 5. Finalize candidates for the IRDA training
  6. 6. Proper understanding and analysis of life insurance industry.
  7. 7. To know about brand awareness of Aegon Religare life insurance and customer’s preference about Aego Religare insurance.
  8. 8. Conduct market survey on a sample selected from the entire population and derived opinion on that research.
  9. 9. According the market survey come know about how much potential of insurance market in our city.
  10. 10. And base on the analysis of the result thus obtained make a report on that research.
  11. 11. Along with it I will gaining thorough knowledge of insurance sector.
  12. 12. 1.4Limitation
  13. 13. Some of the difficulties and limitations faced by me during my training are as follows:
  14. 14. Lack of awareness among the people- This is the biggest limitation found in this sector. Most of the people are not aware about importance and the necessity of the insurance in their life. They are not aware how useful life insurance can be for their family members if something happens to them.
  15. 15. Perception of the people towards insurance sector- people still consider insurance just as a Tax saving device. So today also there is rush to buy an insurance policy only at the end of the financial year like January,February and march making the other nine months dry for this business.
  16. 16. Insurance does not give good returns- still today people think that insurance does not give good returns. They are not aware of the modern unit linked insurance plans which are offered by most of the private sectors players. They are still under the perception that if they take insurance they will get only 5-6% return which is not true nowadays.
  17. 17. Lack of awareness about the earning opportunity in the insurance sector- people still today are not aware about the earning opportunity that the insurance sectors gives. After the privatization of the insurance sector many private giants have entered the insurance sector. These private companies in order to beat the competition and to increase their insurance advisor to increase their reach to the customers are giving very high commission rates but people are not aware of that.
  18. 18. Increased competition- Today the competition in the insurance sector has become very stiff. Currently there are 22 Life Insurance Companies working in india including the LIC. Today each and every company is trying to increase their insurance advisors so that they can increase their insurance advisor so that they can increase their reach in the market. This situation has created a scenario in which to recruit Life Insurance Advisor and to sell life insurance policy has become very difficult.</li></ul>CHAPTER-2<br />INSURANCE INDUSTRY<br />2.1 MEANING OF INSURANCE<br />Insurance may be described as a social device to reduce or eliminate risk of loss to life and property. Insurance is a collective bearing of risk. Insurance is a financial device to spread the risks and losses of few people among a large number of people, as people prefer small fixed liability instead of big uncertain and changing liability.Insurance can be defined as a “legal contract between two parties whereby one party called insurer undertakes to pay a fixed amount of money on the happening of a particular event, which may be certain or uncertain.” The other party called insured pays in exchange a fixed sum known as premium.Insurance is desired to safeguard oneself and one’s family against possible losses on account of risks and perils. It provides financial compensation for the losses suffered due to the happening of any unforeseen events.<br />2.2 IMPORTANCE OF INSURANCE<br />Insurance constitutes one of the major segments of the financial market.Insurance services play predominant role in the process of financial intermediary. Today insurance industry is one of the most growing sectors in India. There is lot of potential in the Indian Insurance Industry.There are many issues, which require study. The scope of the study of insurance industry of India would be very great as there are ongoing developments in the industry after the opening of the sector.The major issue right now is the hike in FDI (Foreign Direct Investment)limit from 26% to 49% in the insurance sector. Government may in near<br />future allow 49% FDI in Insurance. This would lead to more capital inflow by foreign partners.Another major issue is the effects on LIC after the entry of private players in the market. Though market share of LIC has been affected, it has improved<br />in terms of efficiency.There are number of other hot topics like penetration of Health Insurance,Rural marketing of insurance, new distribution channels, new product ranges, insurance brokers’ regulation, incentive scheme of development officers of LIC etc. So it offers lot of scope for studying the insurance<br />industry.Right now the insurance industry has great opportunities in a country like India or China which huge population. Also the penetration of insurance in India is very low in both life and non-life segment so there is lot potential to<br />be tapped.Before starting the discussion on insurance industry and related issues, we have to start with the basics of insurance. So first we understand what is insurance? How the word ‘insurance’ is different from the word‘assurance’? <br />2.3 DIFFERENCE BEETWEN INSURANCE AND ASSURANCE<br />Assurance is older in history and it was used to describe all types of insurances. From 1826, the term assurance came to be used only for the risks covered by life insurance and the term insurance was exclusively used to denote the risks covered by marine, fire, etc.The word assurance indicated certainty. In life insurance, there is an assurance from the insurance company tomake payment under the policy either on the maturity or at earlier death. On the other hand the word insurance was used to denote indemnity type of insurances where the insurance company was liable to pay only in case of the loss damage the<br />property.The insured event was bound to happen sooner or later under assurance but the event insured against may or may not happen under insuranceThe principle of “indemnity” applies to “insurance contracts”(non-life) only.The scope of the word, insurance is wider.<br />2.4 PRINCIPLES OF INSURANCE<br />An insurance contract is based on some basic principles of insurance.<br />(1) Principle of “Uberrima Fides” or Principle of utmost good faith<br />It means “maximum truth”. Both the parties should disclose all<br />material information regarding the subject matter of insurance.<br />(2) Principle of indemnity<br />This means that if the insured suffers a loss against which the policy has been made, he shall be fully indemnified only to the extent of loss. In other words, the insured is not entitled to make a profit on his loss.<br />(3) Principle of subrogation<br />This means the insurer has the right to stand in the place of the insuredafter settlement of claims in so far as the insured’s right of recovery from an alternative source is involved. The insurer before the settlement of theclaim may exercise the right. In other words, the insurer is entitled to recover from a negligent third party any loss payments made to the insured. The purposes of subrogation are to hold the negligent person responsible for the loss and prevent the insured from collecting twice for the same loss. The concept of ‘Third Party Claims’ is based on the same<br />principle.<br />(4) Principle of causa proxima<br />The cause of loss must be direct and an insured one in order to claim of<br />compensation.<br />(5) Principle of insurable interest<br />The assured must have insurance interest in the life or property insured.<br />Insurable interest is that interest which considerably alters the position of<br />the assured in the event of loss taking place and if the event does not take<br />placed, he remains in the same old position.<br />2.5 HISTORY OF INSURANCE<br />The concept of insurance is believed to have emerged almost 4500 years ago in the ancient land of Babylonia where traders used to bear risk of the carvan by giving loans, which were later repaid with interest when the goods arrived safely.The concept of insurance as we know today took shape in 1688 at a place called Lloyd’s Coffee House in London where risk bearers used to meet to transact business. This coffee house became so popular that Lloyd’s became the one of the first modern insurance companies by the end of the eighteenth century. Marine insurance companies came into existence by the end of the eighteenth century. These companies were empowered to write fire and life insurance as well as marine. The Great Fire of London in 1966 caused huge loss of property and life. With a view to providing fire insurance facilities,Dr. Nicholas Barbon set up in 1967 the first fire insurance company knownas the Fire office.The early history of insurance in India can be traced back to the Vedas. TheSanskrit term ‘Yogakshema’ (meaning well being), the name of Life Insurance Corporation of India’s corporate headquarters, is found in the RigVeda. The Aryans practiced some form of ‘community insurance’ around 1000 BC.Life insurance in its modern form came to India from England in 1818. TheOriental Life Insurance Company was the first insurance company to be setup in India to help the widows of European community. The insurance companies, which came into existence between 1818 and 1869, treated Indian lives as subnormal and charged an extra premium of 15 to 20 percent. The first Indian insurance company, the Bombay Mutual Life Assurance Society, came into existence in 1870 to cover Indian lives atnormal rates.The Insurance Act, 1938, the first comprehensive legislation governing both life and non-life branches of insurance were enacted to provide strict state control over insurance business. This amended insurance Act looked into investments, expenditure and management of these companies.By the mid- 1950s there were 154 Indian insurers, 16 foreign insurers, and75 provident societies carrying on life insurance business in India. Insurance business flourished and so did scams, irregularities and dubious investmentpractices by scores of companies. As a result the government decided to nationalize the life assurance business in India. The Life InsuranceCorporation of India (LIC) was set up in 1956. The nationalization of life insurance was followed by general insurance in 1972.<br />2.6 TIME LINE IN INSURANCE HISTORY<br />(MAJOR LANDMARKS)<br /><ul><li>1818 British introduced the life insurance to India with the
  19. 19. establishment of the Oriental Life Insurance Company
  20. 20. in Calcutta.
  21. 21. 1850 Non life insurance started with Triton Insurance
  22. 22. Company.
  23. 23. 1870 Bombay Mutual Life Assurance Society is the first India
  24. 24. owned life insurer.
  25. 25. 1912 The Indian Life Assurance Company Act enacted to
  26. 26. regulate the life insurance business.
  27. 27. 1938 The Insurance Act was enacted.
  28. 28. 1956 Nationalization took place. Government took over 245 Indian and foreign insurers and provident societies.
  29. 29. 1972 Non-life business nationalized, General Insurance
  30. 30. Corporation (GIC) came into being.
  31. 31. 1993 Malhotra committee was constituted under the
  32. 32. chairmanship of former RBI chief R. N. Malhotra to
  33. 33. draw a blue print for insurance sector reforms.
  34. 34. 1994 Malhotra committee recommended reentry of private players.
  35. 35. 􀂾 1997 IRDA (Insurance Regulatory and Development
  36. 36. Authority) was set up as a regulator of the insurance
  37. 37. market in India.
  38. 38. 2000 IRDA started giving license to private insurers. ICICI
  39. 39. Prudential, HDFC were first private players to sell
  40. 40. insurance Policies.
  41. 41. 2001 Royal Sundaram was the first non-life private player to sell an insurance policy.
  42. 42. 2002 Bank allowed to sell insurance plans as TPAs enter the scene, insurers start setting non-life claims in the cashless mode.</li></ul>2.7 MEANING OF LIFE INSURANCE<br />There are three parties in a life insurance transaction: the insurer, the insured, and the owner of the policy (policyholder), although the owner and the insured are often the same person. Another important person involved in a life insurance policy is the beneficiary. The beneficiary is the person or persons who will receive the policy proceeds upon the death of the insured. Life insurance may be divided into two basic classes – term and permanent.<br />• Term life insurance provides for life insurance coverage for a specified term of years for a specified premium. The policy does not accumulate cash value.<br />• Permanent life insurance is life insurance that remains in force until the policy matures, unless the owner fails to pay the premium when due.<br />• Whole life insurance provides for a level premium, and a cash value table included in the policy guaranteed by the company. The primary advantages of whole life are guaranteed death benefits, guaranteed cash values, fixed and known annual premiums, and mortality and expense charges will not reduce the cash value shown in the policy.<br />• Universal life insurance (UL) is a relatively new insurance product intended to provide permanent insurance coverage with greater flexibility in premium payment and the potential for a higher internal rate of return. A universal life policy includes a cash account.Premiums increase the cash account. If you want insurance protection only, and not a savings and investment product, buy a term life insurance policy.If you want to buy a whole life, universal life, or other cash value policy, plan to hold it for at least 15 years. Canceling these policies after only a few years can more than double your life insurance costs. Check the National Association of Insurance Commissioners website ( or your local library for information on the financial soundness of insurance companies.<br />2.8 HISTORY OF LIFE INSURANCE<br />Risk protection has been a primary goal of humans and institutions throughout history. Protecting against risk is what insurance is all about. Over 5000 years ago, in China, insurance was seen as a preventative measure against piracy on the sea. Piracy, in fact, was so prevalent, that as a way of spreading the risk, a number of ships would carry a portion of another ship's cargo so that if one ship was captured, the entire shipmentwould not be lost. In another part of the world, nearly 4,500 years ago, in the ancient land of Babylonia, traders used to bear risk of the caravan trade by giving loans that had to be later repaid with interest when the goods arrived safely. In 2100BC, the Code of Hammurabi granted legal status to the practice. It formalized concepts of “bottomry” referring to vessel bottoms and “respondentia” referring to cargo. These provided the underpinning for marine insurance contracts. Such contracts contained three elements: a loan on the vessel, cargo, or freight; an interest rate; and a surcharge to cover the possibility of loss. In effect, ship owners were the insured and lenders were the underwriters.Life insurance came about a little later in ancient Rome, where burial clubs were formed to cover the funeral expenses of its members, as well as help survivors monetarily. With Rome's fall, around 450 A.D., most of the concepts of insurance were abandoned, but aspects of it did continue through<br />the Middle Ages, particularly with merchant and artisan guilds. These provided forms of member insurance covering risks like fire, flood, theft, disability, death, and even imprisonment.During the feudal period, early forms of insurance ebbed with the decline of travel and long-distance trade. But during the 14th to 16th centuries, transportation, commerce, and insurance would again reemerge. Insurance in India can be traced back to the Vedas. For instance,yogakshema, the name of Life Insurance Corporation of India's corporate headquarters, is derived from the Rig Veda. The term suggests that a form of "community insurance" was prevalent around 1000 BC and practiced by the Aryans. And similar to ancient Rome, burial societies were formed in the Buddhist period to help families build houses, and to protect widows and children.<br />Modern Insurance<br />Illegal almost everywhere else in Europe, life insurance in England was vigorously promoted in the three decades following the Glorious Revolution of 1688. The type of insurance we see today owes it's roots to 17th century England. Lloyd's of London, or as they were known then, Lloyd's Coffee House, was the location where merchants, ship owners and underwriters met to discuss and transact business deals.While serving as a means of risk-avoidance, life insurance also appealed strongly to the gambling instincts of England's burgeoning middle class.Gambling was so rampant, in fact, that when newspapers published names of prominent people who were seriously ill, bets were placed at Lloyd’s on their anticipated dates of death. Reacting against such practices, 79 merchant underwriters broke away in 1769 and two years later formed a “New Lloyd’s Coffee House” that became known as the “real Lloyd’s.” Making wagers on people's deaths ceased in 1774 when parliament forbade the practice.<br />Insurance moves to America<br />The U.S. insurance industry was built on the British model. The year 1735 saw the birth of the first insurance company in the American colonies in Charleston, SC. The Presbyterian Synod of Philadelphia in 1759, sponsored the first life insurance corporation in America for the benefit of ministers and their dependents. And the first life insurance policy for the general public in the United States was issued, in Philadelphia, on May 22, 1761. But it wasn't until 80 years later (after 1840), that life insurance really took off in a big way. The key to its success was reducing the opposition from religious groups. In 1835, the infamous New York fire drew people's attention to the need to provide for sudden and large losses. Two years later, Massachusetts became the first state to require companies by law to maintain such reserves. The great Chicago fire of 1871 further emphasized how fires can cause huge losses in densely populated modern cities. The practice of reinsurance, wherein the risks are spread among several companies, was devised specifically for such situations.With the creation of the automobile, public liability insurance, which first made its appearance in the 1880s, gained importance and acceptance?<br />More advancement was made to insurance during the process of<br />industrialization. In 1897, the British government passed the Workmen's Compensation Act, which made it mandatory for a company to insure its employees against industrial accidents. During the 19th century, many societies were founded to insure the life and health of their members, while fraternal orders provided low-cost, membersonly insurance. Even today, such fraternal orders continue to provide insurance coverage to members, as do most labor organizations. Many employers sponsor group insurance policies for their employees, providing<br />not just life insurance, but sickness and accident benefits and old-age pensions. Employees contribute a certain percentage of the premium for these policies.<br />Final Thoughts<br />Even though the American insurance industry was greatly influenced by Britain, the US market developed somewhat differently from that of the United Kingdom. Contributing to that was America's size; land diversity and the overwhelming desire to be independent. As America moved from a colonial outpost to an independent force, from a farming country to an industrial nation, the insurance business developed from a small number of companies to a large industry.Insurance became more sophisticated, offering new types of coverage and diversified services for an increasingly complex country.<br />2.9 KEY FEATURES OF LIFE INSURANCE<br />1) Nomination: -<br />When one makes a nomination, as the policyholder you continue to be the owner of the policy and the nominee does not have any right under the policy so long as you are alive. The nominee has only the right to receive the policy monies in case of your death within the term of the policy.<br />2) Assignment: -<br />If your intention is that your policy monies should go only to a particular person, you need to assign the policy in favor of that person.<br />3) Death Benefit: -<br />The primary feature of a life insurance policy is the death benefit it provides. Permanent policies provide a death benefit that is guaranteed for the life of the insured, provided the premiums have been paid and the policy has not been surrendered.<br />4) Cash Value: -<br />The cash value of a permanent life insurance policy is accumulated throughout the life of the policy. It equals the amount a policy owner would receive, after any applicable surrender charges, if the policy were surrendered before the insured's death.<br />5) Dividends: -<br />Many life insurance companies issue life insurance policies that entitle the policy owner to share in the company's divisible surplus.<br />6) Paid-Up Additions: -<br />Dividends paid to a policy owner of a participating policy can be used in numerous ways, one of which is toward the purchase of additional coverage, called paid-up additions.<br />7) Policy Loans: -<br />Some life insurance policies allow a policy owner to apply for a loan against the value of their policy. Either a fixed or variable rate of interest is charged. This feature allows the policy owner an easily accessible loan in times of need or opportunity.<br />8) Conversion from Term to Permanent: -<br />When in need of temporary protection, individuals often purchase term life insurance. If one owns a term policy, sometimes a provision is available thatwill allow her to convert her policy to a permanent one without providing additional proof of insurability.<br />9) Disability Waiver of Premium<br />Waiver of Premium is an option or benefit that can be attached to a life insurance policy at an additional cost. It guarantees that coverage will stay in force and continue to grow.<br />2.10 BENEFITS OF LIFE INSURANCE<br />1) Risk cover: -<br />Life Insurance contracts allow an individual to have a risk cover against any unfortunate event of the future.<br />2) Tax Deduction: -<br />Under section 80C of the Income Tax Act of 1961 one can get tax deduction on premiums up to one lakh rupees. Life Insurance policies thus decrease the total taxable income of an individual.<br />3) Loans: -<br />An individual can easily access loans from different financial institutions by pledging his insurance policies.<br />4) Retirement Planning: -<br />What had provided protection against the financialconsequences of premature death may now be used to help them enjoy their retirement years. Moreover the cash value can be used as an additional income in the old age.<br />5) Educational Needs: -<br />Similar to retirement planning the cash values that flow from ones life insurance schemes can be utilized for educational needs of the insurer or his children.<br />2.11 ROLE OF LIFE INSURANCE IN THE GROWTH OF THE ECONOMY<br />The Life Insurance Industry has an enviable track record among public sector units. It has a Consistent profit and dividend paying record accompanied by a steady growth in its financial resources. Through investments in the Government sector and socially- oriented sectors the Industry has contributed immensely to the nation's development. The industry is recognized as one of the largest financial Institutions in the country. The ventures initiated by the industry in the areas of Mutual Fund, Housing Finance has done exceedingly well in recent years. To protect the country's foreign exchange reserves, the reinsurance arrangement are so organized that maximum retention is made possible within the country while at the same time protecting interests of the policy holders.<br />INTRODUCTION TO THE COMPANY<br />3.1 About Aegon Religare Life Insurance<br /><ul><li>AEGON, one of the world’s largest life insurance and pension groups, Religare, one of India’s leading integrated financial services groups and Bennett, Coleman & company, India’s largest media house, have come together to launch AEGON Religare Life Insurance Company Limited. This venture is dedicated to build a firm future, both for customers and employees and will continue to balance a local approach with the power of an expanding global operation. We launched our pan-India multi-channel operations in July, 2008 with over 30 branches spread across India. Our business philosophy is to help people plan their life better. We provide high quality advice to our customers and offer superior customer service. In an industry first, AEGON Religare Life Insurance offers policy servicing on the phone via Interactive Voice Response System (IVR) by issuing the customer a T-Pin for authentication. It is also the first company to include the customer’s medical report in the policy kit.AEGON’s businesses serve over 40 million customers in over 20 markets throughout the Americas, Europe and Asia, with major operations in the United States, the Netherlands and the United Kingdom. With headquarters in The Hague, the Netherlands, AEGON companies employ almost 32,000 people worldwide. The company’s common shares are listed on four stock exchanges: Amsterdam, London, New York and Tokyo. It manages EUR 351 billion in revenue generating investments. AEGON has more than 160 years of experience with its roots going back to 1844. It holds 26% equity in our company.http://www.aegon.comAbout Religare Enterprises LimitedReligare is a diversified financial services group of India offering a multitude of investment options. Financial services which Religare offers can be broadly clubbed across three key verticals - Retail, Institutional and Wealth spectrums. Religare has also ventured into the alternative investments sphere through its holistic arts initiative and Film fund. With a view to expand, diversify and introduce offerings benchmarked against global best practices, Religare operates in the wealth management space under the brand name 'Religare Macquarie Private Wealth'. Religare has a pan India presence, 1837 locations across 498 cities and towns. It also currently operates from nine international locations following its acquisition of London's brokerage & investment firm, Hichens, Harrison & Co. plc. (Now Religare Hichens, Harrison Plc).http://www.religare.inBennett, Coleman & Co. Ltd. (BCCL), part of the mammoth Times Group, is India’s largest media house. It reaches out to 2468 cities and towns all over India. The group owns and manages powerful media brands like The Times of India, The Economic Times, Maharashtra Times, Navbharat Times, Femina, Filmfare, Grazia, Top Gear, Radio Mirchi, Zoom, Times Now, Times Music, Times OOH, Private Treaties and All of its brands are multinational in outlook, traditional at heart and national in spirit. From the very first edition on November 3, 1838 the mammoth BCCL Group has come a long way. By way of the innovative venture of Times Private Treaties (, the BCCL Group holds 30% equity in our company.MILESTONES IN THE HISTORYReligare is a diversified financial services group of India offering a multitude of investment options.Religare has a pan India presence, 1837* locations across 498* cities and towns. It also currently operates from nine international locations following its acquisition of London's brokerage & investment firm, Hichens, Harrison & Co. plc. (Now Religare Hichens, Harrison Plc).AEGON Religare Life Insurance launched its pan-India multi-channel operations in July, 2008 with over 30 branches spread across India in day 1.AEGON Religare is also the first company to include the customer's medical report in the policy kit.3.2Role of IT at Aegon Religare Life InsuranceInter Office Connectivity: -All their Branch / Area and Regional offices will be interconnected to their Data Centre with a 24x7 access to CoreApplications like Lotus Mail, Life-Asia and Internet Applications. This will enable their associates to work faster and better with high-speed Internet connectivity and also ensure faster Turn Around Time for theircustomers. 2. Customer Care Centre: -They will host a centralized Customer Care Centre at Navi Mumbai, which cater services to internal and external queries and complications. A customer Relationship Management Tool (CRM) and Lead Management System (LMS) are in progress.Web Portal: -This portal will be an interface between both internal employeesand their external users. Some of the functions included in their portal are Policy Tracking Systems, Corporate News, Quality Checking System, Under Writing Medical System, and Agent Management System etc.SMS Alerts: -SMS Alerts will be provided to their Sales Managers about thelatest happenings like Contests and Campaigns, Employee Alerts will include Company News and Welcome/Birthday/Anniversary message etc. Customer Alerts will include Welcome/Birthday/Anniversary message, Policy Dispatch Details, Policy Servicing SMS like Premium Receipt and Renewal Premium reminders etc.Advisor Lounge: -It is a dedicated area forAegon Religare Life Insurance Agents/Advisors in all the branches across India. This Lounge will be equipped with desktops and printers with Internet connectivity, where their Advisors can bring in the prospects and can have discussions across the table and they can create and print quotes. The Agents/Advisors can use this area to service their existing customers.Document Management System: -DMS will enable both policy issuance and contract servicing through an automated workflow, which yields a faster Turn around Time to both internal and external users. This application will enable them to have a paperless office and thus mitigate the risk of losing vital records/papers.3.3CORE VALUESAegon Religare Life Insurance Company Limited has some core values which are listed as follows:1) Result Oriented2) Performance Driven3) Customer Focused4) Learning and Development Oriented5) Employee Centric6) Informal and Fun3.4 SUBSIDIARY COMPANIES:1. Religare Securities Limited Equity Broking Online Investment Portal Portfolio Management Services Depository Services 2. Religare Commodities Limited Commodity Broking 3. Religare Capital Markets Limited Investment Banking Proposed Institutional Broking 4. Religare Realty Limited In house Real Estate Management Company 5. Religare Hichens Harrison** Corporate Broking Institutional Broking Derivatives Sales Corporate Finance6. Religare Finvest Limited Lending and Distribution business Proposed Custodial business7. Religare Insurance Broking Limited Life Insurance General Insurance Reinsurance 8. Religare Arts Initiative Limited Business of Art Gallery launched - arts-i 9. Religare Venture Capital Limited Private Equity and Investment Manager 10. Religare Asset Management** Religare Asset Management Company (P) Limited is a wholly owned subsidiary of Religare Securities Limited (RSL), which in turn is a 100% subsidiary of Religare Enterprises Limited.** Religare Hichens, Harrison plc. (RHH) is a part of Religare Enterprises Limited (REL) – a leading integrated financial services group of India. Hichens, Harrison & Co. plc. (HH), established in 1803 is London’s oldest brokerage and investment firm with a global footprint. Post its acquisition through REL’s indirect subsidiary - Religare Capital Markets International (UK) Limited, HH has been rechristened as Religare Hichens Harrison plc.ASSOCIATE COMPANIES:Fortis Healthcare LimitedSuper Religare Laboratories Limited (formerly SRL Ranbaxy)Religare Wellness Limited (formerly Fortis Healthworld)Religare Technova LimitedReligare Voyages LimitedRELIGARE JOINT VENTURES:3.5HEAD OFFICES AND BRANCHESThere are 50 branches in 19 States through out India:Corporate and Registered OfficeAEGON Religare Life Insurance,2nd Floor, Paranjpe B Scheme, Subhash Road, Near Garware House,Vile Parle (E), Mumbai - 400 057.Other BranchesAhmedabadAmritsarBengaluru- BrigadeBengaluru- KoramaBhopalBhubaneswarChandigarhChennai- Mount RoadCoimbatoreDehradunFaridabadGurgaonGuwahatiHubliHyderabad- PaniagutHyderabad- SecunderabadIndoreJaipurJalandharJamshedpurKanpurKochiKolkata- DalhousieKolkata- GarihatLucknow- Sikander BadLucknow- Vidhan sabha RoadLudhianaManagaloreMumbai- DadarMumbai- BelapurMumbai- KandivaliNagpurNashikNew Delhi- Kailash ColonyNew Delhi- PitampuraNoidaPanipatPanjimPune- Koregaon RoadPune- Sachapir StreetRaipurRajkotRanchiSalemSuratThriuvananthapuramThrissurVadodaraVaranasi 4. Product mixFINANCIAL FIGURES:The 22-member life insurance company league collected nearly Rs 5,053 crore as first year premium in May 09, a 40 percent growth over Rs 3,602 crore garnered in April 09 with growth coming from products aimed at individuals – both single premium as well as non-single premium</li></ul> <br />Most of the new entrants such as Aegon Religare (153 percent), Future Generali Life (67 percent), IDBI Fortis Life (38 percent), Bharti Axa Life (31 percent), DLF Pramerica (11 percent), and Star Union Dai-ichi (8 percent) did well in May. Only Canara HSBC OBC Life saw premium collections drop 34 percent to Rs 30.3 crore.<br /> Source-------The Times of India (Chennai edition)<br />Within one year of time AEGON Religare issued 27000 policies with 100 crore plus sum assured.<br />4.2 QUALITY POLICY:<br />Security: Providing long term financial security to our policy holders will be our constant endeavor. We will be do this by offering life insurance and pension products.  <br />Trust: We appreciate the trust placed by our policy holders in us. Hence, we will aim to manage their investments very carefully and live up to this trust.  <br />Innovation: Recognizing the different needs of our customers, we will be offering a range of innovative products to meet these needs.  <br />Integrity<br />Customer centric <br />People care “one for all and all for one” <br />Team work<br />Joy and <br />Simplicity<br />4.3 PRODUCT SCOPE:<br />AEGON Religare Life offers a bouquet of insurance solutions to meet every need. The company caters to both, individuals as well as to companies looking to provide benefits to their employees.<br />For individuals, the company has a range of protection, investment, pension and savings plans that assist and nurture dreams apart from providing protection. The customers can choose from a range of products to suit their life-stage and needs.<br />The products of the company are categorized into various sections which are as follows:<br />1. Protection<br />2. Saving<br />3. Child<br />4. Retirement<br />Protection plan:<br />Secure your family financially with our range of protection plans that take care of your long-term as well as short-term requirements - at a fraction of the cost. The products are:<br />AEGON Religare Level Term plan<br />AEGON Religare Increasing Term plan<br />AEGON Religare Decreasing Term Plan<br />AEGON Religare Group Term Plan<br />AEGON Religare Rural Term Plan<br />Childs Plan:<br />Protect your child's dreams and save for his / her desired future with our child plan.<br />AEGON Religare star child Plan<br />Savings plan:<br />Get the dual benefit of securing your family financially as well as saving for a brighter future with our ULIP plans.<br />AEGON Religare Protect Gain Plan<br />AEGON Religare Premium Gain Plan<br />Retirement plan: <br />AEGON Religare Pension Plan<br />AEGON Religare Insta Pension Plan<br />PRODUCT PORTFOLIO<br />AEGON Religare offers products as per the life stages of the customers and their respective needs.<br />Your insurance need will change as your life does, from starting to work to enjoying your golden years and all the stages in between. Each one of these stages may pose a different insurance need/cover for you. In this section, we have drawn up the basic life stages and help you analyze various insurance needs accordingly.<br />LIFE STAGES & NEEDS IN HAT STAGES<br />STAGE 1: YOUNG & SINGLE<br />-11430022860<br />An important stage where one lays down the foundation of a successful life ahead. Take advantage of the time and power of compounding to ensure that you build up your dreams. Start saving early.<br />NEEDS: <br />Save for Home & Wedding<br />Tax Planning<br />Save for Golden Years<br />STAGE 2: JUST MARRIED<br />049530<br />Marriage brings about a significant change. New dreams and new opportunities also bring in additional responsibilities. While both of you look forward to a happy and secure life, it is equally important to ensure that eventualities don’t come in the way of shaping your dreams. <br />NEEDS: <br />Planning for home / securing your home loan liability.<br />Save for vacation.<br />Save for your first child.<br />STAGE 3: PROUD PARENTS<br />045720<br />Once you have children, your need for life insurance is even more. You need to protect your family from an untoward incident. Ensure your protection umbrella takes into account the future cost of securing your child’s dream. You will want life to go on for your loved ones, and having enough life insurance is a way to help ensure that.<br />NEEDS: <br />Provide for children's education<br />Safeguarding family against loan liabilities<br />Savings for post-retirement<br />STAGE 4: PLANNING FOR RETIREMENT<br />069215<br />While you are busy climbing the ladder of success today, it is important for you to take time and plan for your life after retirement. Having an early start for retirement planning can make a significant difference to your savings. Think about your golden years even before you have reached them. The key is to think ahead and plan well using your time and money.<br />NEEDS – <br />Provide for regular income post retirement<br />Immediate Tax benefits<br />Lead a secure, independent and comfortable life style in your retirement years.<br />CHAPTER – 5<br />HUMAN RESOURCE MANAGEMENT<br />5.1 RECRUITMENT<br />Recruitment is the process of finding and attracting capable applicants for employment. The process begins when new recruits are sought and ends when their applications are submitted. The result is a pool of applicants from which new employees are selected. In this company the Sales Manager, who recruits the advisors/agents for selling the products of the company, does the recruitment. The advisors should have at least passed the S.S.C. examination. They must pass the prerecruitment examination, which is conducted by the Insurance Institute of India, Mumbai, or any other approved examination body. After clearing the examination the code will be provided to them and the license will also be given to them, the validity the license would be 3 years. After all these requirements, the person will become an insurance advisor in the company.<br />5.2 SELECTION<br />Selection is the process of picking individuals (out of the pool of job applications) with requisite qualifications and competence to fill job in the organization. In simple words, it is the process of differentiating between applicants in order to identify these with a greater likelihood of success in a job. The Branch Manager, which includes-, will conduct the process of selection of Sales Manager.<br />1) Personal Interview: -<br />The first step of selection of Sales Manager in the<br />Reliance Life Insurance Company Limited is to conduct a personal interview<br />of an applicant by the Branch Manager.<br />2) Project 40 Interview: -<br />After clearing the personal interview, the project 40<br />interview will be taken by the Branch Manager. In this step, the applicant<br />should have to make a list of 40 and then start the business with them.<br />3) Interview with Regional Head: -<br />After clearing the project 40 interview, the applicant<br />should be interviewed by the Regional Head, who will check his/her<br />performance.<br />4) Negotiation: -<br />After clearing the interview with Regional Head, the<br />negotiation will be provided to the applicant.<br />5) Medical Examination: -<br />After that, the medical check up should e made to the<br />applicant.<br />6) Selection: -<br />After clearing all the above steps the applicant should be<br />appointed/selected as a Sales Manager in the company.<br /> <br />Requirements of Sales Manager:-<br />The Sales Manager should possess the<br />following things-<br />1. They should be an M.B.A.<br />2. The age of them should be between 25 to 35 years.<br />3. They should have good communication skill.<br />4. They should have at least sales experience of 3 years.<br />5. They should have the capability to handle the team.<br />6. Their job profile includes recruitment, training, guiding, motivating<br />and in turn getting business out of a team.<br />5.3 TRAINING AND DEVELOPMENT:-<br />Training and Development is any attempt to improve current or future employee performance by increasing an employee’s ability to perform through learning usually by changing the employee’s attitude or increasing his/her skills and knowledge. The need for training and development is determined by the employee’s performance deficiency, computed as follows:<br />Training & Development = Standard Performance – Actual Performance They are providing 100 hours training to their advisors, who are newly recruited. They are also providing the product training to their advisors and Sales Managers, who are newly recruited. The 100 hours training is to be conducted at Net Bios Computer Academy whereas the product training is to be conducted at NIS SPARTA. The NIS SPARTA Institute has more than 150 batches and is trained over 3000 agents for most<br />of the private insurance companies. This institute is approved by IDRA to train agents/advisors.<br />5.4 CAREER DEVELOPMENT<br />They are also providing career development plans, which will identify potential and create avenues for growth.<br />5.5 COMMUNICATION<br />Communication is the process through which an individual can exchange their beliefs, things, information, and experience to others. In simple words, it is the process of exchanging the information from one person to another. They are providing an open environment, which enabling free interaction between all levels. The communication is provided in the following manner:<br />BRANCH<br />BRANCH BRANCH<br />REGIONAL<br />C M O<br />REGIONAL<br />REGIONAL<br />CHANNEL<br />HEAD<br />C E O<br />Explanations of the diagram:-<br />The communication is flow between Branch to Branch.<br />Within a branch, it flows between Branch Manager to Sales Managers and Sales Managers to Agents/Advisors, and then Branch Head to Regional Head, then different Regional Head to Regional Head, then Regional Head to Channel Head, then to Chief Marketing Officer (CMO), then to Chief Executive Officer (CEO).<br />5.6 INCENTIVES<br />Incentives are monetary benefits paid to workmen in recognition of their outstanding performance. They are providing an aggressive reward and recognition plans, which are including sales incentives.<br />5.7 SERVICES<br />They are offering following certain services to their employees.<br />1) They are providing knowledge sharing and certification practices.<br />2) They are planned team building and fun events.<br />3) They are creating Reliance Life Insurance family, which includes employees, associates and their families.<br />4) Reliance Life Insurance in a team building mode and is looking for performance driven, achievement oriented and challenge loving performance.<br />5.8 PERFORMANCE APPRAISAL<br />Performance appraisal is the systematic evaluation of the individual with respect to his/her performance on the job and his/her potential for development. Performance appraisal is a formal, structured system of measuring and evaluating an employee’s job related behaviors and outcomes to discover how and why the employee is presently performing on the job and how the employee can perform more effectively in the future so that the employee, organization and society all benefit. They are providing a balanced scorecard approach for strategy deployment and performance measurement, which goals and measure financial, customer focused, process related and employee development related initiatives. In addition to this, the Branch Manager should measure the performance of the Sales Managers at every six months and the Sales Manager should measure the performance of the advisors/agents. If the performance is best then he/she will be prompted.<br />5.9 ORGANIZATION FORM AND STRUCTURE<br />CEO<br />CMO<br />Channel Head<br />Regional Head<br />Branch Head<br />SalesC MEOanager<br />Advisors/Agents<br />Customers<br />5.10 DEPARTMENT<br />They are providing following areas or departments:<br />1) Retail Sales<br />2) Under Writing<br />3) Actuarial<br />4) Insurance Operations<br />5) Customer Service<br />6) Quality and Processes<br />7) Human Resources<br />8) Finance<br />6.MARKETING DEPARTMENT<br />6.1 COMPARATIVE STUDY<br />Presently there are 15 major Life insurance companies in the country.<br />There is only one public sector company LIC and the rest 14 are private sector. Although LIC has been dominating the Life Insurance business since past few years the private players have now started to take the momentum<br />1) Major Market Players: -<br /> Birla Sun Life Insurance Company: -<br />Birla Sun Life Insurance Company is a 74:26 joint venture<br />between Birla group and Sun Life Financial. It is a private sector company. The company was registered on 31/1/2001. The market share for FY 2005- 06 was 1.89%.<br /> HDFC – Standard: -<br />HDFC standard is a 74:26 joint venture between HDFC and<br />Standard Life. It is a private sector company. The company was registered on 23/10/2000. The market share for FY 2005-06 was 2.87%.<br /> ICICI Prudential Life Insurance: -<br />ICICI Prudential Life is a 74:26 joint venture between ICICI<br />and Prudential. It is a private sector company. The company was registered on 24/11/2000. The market share for FY 2005-06 was 7.35%.<br /> Life Insurance Corporation of India (LIC): -<br />Life Insurance Corporation of India is a 100% government held<br />Public Sector Company. Being the first to be established LIC is the forerunner in the Life Insurance sector. The market share for FY 2005-06 was 71.44%.<br /> Kotak Mahindra OLD Mutual: -<br />Kotak Mahindra OLD Mutual is a 74:26 joint venture between<br />Kotak Mahindra bank and Old Mutual. It is a private sector company. The company was registered on 10/1/2001. The market share for FY 2005-06 was 1.11%.<br />Max New York Life: -<br />Max New York Life is a 74:26 joint venture between J & Bank,<br />Pallonji & Co and MetLife. It is a private sector company. The company was registered on 6/8/2001. The market share for FY 2005-06 was 1.23%.<br />Aviva Life Insurance India: -<br />Aviva Life insurance is a 74:26 joint venture between Aviva and<br />Dabur. It is a private sector company. The company was registered on 14/5/2002. The market share for FY 2005-06 was 1.14%.<br /> ING Vysya Life insurance: -<br />ING Vysya Life Insurance is joint venture between Exide<br />(50%), Gujarat Cements (14.87%), Enam (9.13%) and ING (26 %). It is a private sector company. The company was registered on 2/8/2001. The market share for FY 2005-06 is 0.79%.<br /> Met Life India: -<br />Met Life India is a 74:26 joint venture between 74:26 JV<br />between J & Bank, Pallonji & Co and MetLife. It is a private sector company. The company was registered on 6/8/2001. The market share for FY 2005-06 was 0.40%.<br />Bajaj Allianz Life Insurance Co.: -<br />Bajaj Allianz Life Insurance Company is a 74: 26 Joint venture between Bajaj Auto limited and Allianz AIG. The company was<br />registered on 3/8/2001. The market share for FY 2005-06 was 7.56%.<br /> <br />SBI Life Insurance Company Ltd: -<br />SBI Life Insurance Company is a 74: 26 Joint venture between<br />SBI and Cardiff S.A. The company was registered on 31/3/2001.It is a private sector company. The market share for FY 2005-06 was 2.31%.<br />The TATA AIG Group: -<br />TATA AIG group is a 74:26 JV between Tata Group and AIG. It belongs to the private sector. The company was registered on 12/2/2001. The market share for FY 2005-06 was 1.29%.<br /> Sahara India Life Insurance Company Ltd.: -<br />First Wholly Indian Owned Private Life Insurance Company.<br />The Company commenced operations from 30th October 2004. The market share for FY 2005-06 was 0.06 %.<br /> Shriram life insurance company Ltd: -<br />Shriram Life is a recent entrant into the life insurance sector<br />It is a 74:26 joint venture between the Shriram group through its Shriram Financial Holdings and Sanlam Life Insurance Limited, South Africa. The company expects to start operations soon.<br />2) Market Share: -<br />Sr. No Insurer Market Share (%)<br />1 LIC 71.44<br />2 Bajaj Allianz 7.56<br />3 ICICI Prudential 7.35<br />4 HDFC Standard 2.87<br />5 SBI Life 2.31<br />6 Birla SunLife 1.89<br />7 Tata AIG 1.29<br />8 Max New York 1.23<br />9 Aviva 1.14<br />10 Kotak Mahindra OLD Mutual 1.11<br />11 ING Vysya 0.79<br />12 Reliance Life 0.54<br />13 MetLife 0.4<br />14 Sahara Life 0.06<br />15 Shriram Life 0.03<br />Capital Fund: -<br />Capital Fund of Private Companies (Rs. in Crore ) <br />ICICI Prudential----------------------------------------- 375<br />Max New York -------------------------------------------250<br />HDFC Standard ------------------------------------------218<br />Bajaj Allianz ---------------------------------------------200<br />Tata AIG --------------------------------------------------183<br />Birla Sun Life --------------------------------------------180<br />AVIVA ----------------------------------------------------155<br />OM Kotak -------------------------------------------------153<br />Reliance Life ----------------------------------------------126<br />SBI Life ----------------------------------------------------125<br />Met Life---------------------------------------------------- 110<br />ING Vysya---------------------- ---------------------------110<br />CHAPTER – 7<br />RESEARCH METHODOLOGY<br />7.1 OBJECTIVES OF STUDY<br />1) To get some good market exposure by dealing with the prospects face to face.<br />2) To improve our ability to sell a financial product like life<br />insurance.<br />3) To know the perception of the consumer about life insurance.<br />4) To get a deep knowledge of the financial product like insurance.<br />5) To get some information about the market share of Reliance Life Insurance as compared to the giants like LIC and to know the standing of the company in the market.<br />7.2 QUESTIONNAIRE<br />It is most common instrument whether administered in person by phone or online questionnaires are very flexible. The form of each question is also important. Closed end question include all the possible answers and subjects matters choices among them. I have used open-end questions so that customers can write answer in their own words. I have also used closed-end questions, which provide answers that are easier to interpret and tabulate. I have taken care in the wording and ordering of questions. I have used simple, direct, unbiased wording questions, which are arranged in a logical order. I have asked personal questions at last so that respondent does not become defensive.<br />Questionnaire of the customer<br />I have made questionnaire consisting seventeen questions to get customer’s view about life insurance. I have asked personal questions at last so that they do not become defensive. I have tried to know their performance i.e. whether they want to invest, where thy want to invest, up to what amount and since when.<br />7.3 SAMPLING METHOD AND SAMPLE SIZE<br />Introduction:-<br />Any organization whether big or small, private or public need<br />different types of information are to know its popularity. I have gathered secondary data and primary data and collected information from the combination of these two data.<br /> Secondary data: -<br />Secondary data consist of information that already exists somewhere, having been collected for another purpose. I have gathered secondary data from website of different operators, different magazines, newspapers and libraries.<br />Primary data: -<br />I have taken great care while collecting primary data to answer that it is relevant, accurate, current and unbiased. I have taken a sample of 50 people. I have visited them personally to get data.<br />Sample size: -<br />I have taken sample size of 50 respondents. Because the population is too large so it is difficult to survey.<br />7.4 LIMITATIONS<br />I am a human hang, so there is some limitation of the human<br />hangs which is reflected in this research.<br />The following are the limitation of this research study.<br />1) The sample size of 50 might not represent the perception of whole population, as the sample size is too small for total population of bhubaneswar city.<br />2) The opinion expressed by the respondents may be biased.<br />3) The attitude of the research might be biased.<br />4) One of the most influencing and most critical limitations is that I am not trained for the research study and this is my first study. I tried hard to come at conclusion, but there is lack of expertise.<br />5) Another limitation is that there is lack of time. If I give more time then studies will be more effective. There are some limitations of this study. But in spite of their limitation I worked with the enthusiasm. And I tried to give the best results to the<br />research of this report.<br />7.5 ANALYSIS OF QUESTIONNAIRE<br />Here I have formed a questionnaire to study why people go for life insurance. What is people’s major motive behind investing in life insurance? Do they decide upon their own or they take guidance of an agent? What is their perception about Reliance Life Insurance Company Limited?<br />Questions:-<br />There are 7 questions in the questionnaire. Out of these 7 questions, 6 questions are close ended and one question is an open ended one.<br /> Target Population:-<br />I had conducted this survey among 50 people, and the target group was a mix of people from the society. I asked the questions to Doctors, Professionals, Professors, Advocates, Engineers, and general public.<br />Analysis:-<br />I have used pie charts, and some other statistical measures to analyze the questions.<br />Q.1 What is your main motive behind investing in life insurance?<br />(a) Tax Benefit<br />(b) Savings<br />(c) Risk Cover<br />(d) Return/Yield<br />MOTIVE NO.<br />TAX 20<br />SAVING 5<br />RISK COVERAGE 23<br />RETURN/YIELD 2<br />TOTAL 50<br />There could be any motive of people behind investing in a<br />life insurance policy. The main purpose of life insurance is the<br />Risk cover of one’s life. But some people consider different advantages of a life insurance policy. Some people consider Tax benefit as the main advantage of life insurance. Some believe that life insurance is an investment so they tend to invest in life insurance. While some people believe that it is a compulsory saving. Now let’s see what all people say Here we can see that majority of the people tend to invest in life insurance for the risk coverage. The next preferred option is Tax Saving. We founded<br />from the discussion with public and some experts that those people with a low income tend to invest in life insurance to gain tax benefit. Saving motive constitutes very small part of the total sample. Return comes last. But this is the general conclusion of 50 people. If we take a larger sample, we can get a different result. As the private players have launched ULIPs, more and more people are turning towards these products so the Investment motive has been gaining command. Also the number of those people who wish to invest for return is also increasing.<br />According to a life insurance expert (Vinod Thakkar ), life insurance is for protection first then for Savings and Tax benefits all those things.<br />Here we can see that majority of the people tend to invest in life insurance for the risk coverage. The next preferred option is Tax Saving. We founded from the discussion with public and some experts that those people with a low income tend to invest in life insurance to gain tax benefit. Saving motive constitutes very small part of the total sample. Return comes last. But this is the general conclusion of 50 people. If we take a larger sample,<br />we can get a different result. As the private players have launched ULIPs, more and more people are turning towards these products so the Investment motive has been gaining<br />command. Also the number of those people who wish to invest for return is also increasing.<br />According to a life insurance expert (Vinod Thakkar ), life insurance is for protection first then for Savings and Tax benefits all those things.<br />Q.2 Rank the above motives according to your preference<br />MOTIVE OF INVESTMENT<br />TAX BENEFIT SAVINGS RISK COVER RETURN/YIELD<br />21 3 24 1<br />19 11 16 4<br />8 25 7 10<br />2 11 3 35<br />We can see from the table and the that the number one motive of people about investing in life insurance is risk coverage, which is the main theme of life insurance followed by Tax benefit. The third position is of saving and fourth is Return. This shows that still people consider other financial tools more viable for return and life insurance is for Tax benefit and risk cover.<br />Q.3 How do you decide about investing in life insurance?<br />(a) On my own<br />(b) family decision<br />(c) Employer decides<br />(d) as per the guidance of agent<br />This is a very crucial question as most of the people are not much familiar about different life insurance plans offered by different life insurance companies so people take help of the life insurance agent and as he guides understanding the needs of the individual, people would invest. Here one hazardous factor is the moral hazard. People tend to invest in life insurance plans to maintain relations though they are not in need of life insurance.<br />Also sometimes it depends upon the convincing power of the agent. Here we can see that majority people (58%) decides on their about investing in life insurance. 28% persons decides as per the guidance of the agent.<br />SOURCE NO.<br />ON MY OWN 29<br />FAMILY DECISION 7<br />EMPLOYER DECIDES 0<br />AGENT GUIDANCE 14<br />TOTAL 50<br />There is no contribution of employers in the decision of one’s investment in life insurance. 14% people invest in life insurance as per the family decision.<br />Q.4. Which life insurance policy would you prefer to buy?<br />(a) Term Assurance<br />(b) Whole Life<br />(c) Endowment<br />(d) Combination of Whole Life and Endowment<br />(e) Unit Linked<br />This is another crucial question as there are number of products offered by life insurance companies. The products range from pure Term Assurance Plans to Unit Linked Insurance Plans, which are relatively new entrant in the market. We have already explained all these policies ahead. Now let’s find out what people have to say:<br />Type of policy N0.<br />Term Assurance 9<br />Whole Life 9<br />Endowment 7<br />Combined 19<br />ULIPs 6<br />TOTAL 50<br />As it is evident from the chart and the table 38% people prefer combination of Whole Life and Endowment product. It gives people double advantage. The person would get some amount at the end of the stipulated period; for instance 20 years, and after that period the risk cover continues and the rest of the amount would be paid when the person dies.<br />Q.5 Would you prefer Aegon ReligareLife Insurance or LIC for buying the life insurance policy?<br />(a) AegonReligare Life Insurance<br />(b) LIC<br />This is the most important question as it reflects the scope of the study. It is the main theme of this questionnaire. Prior to 2000 LIC was the only player in the life insurance market and it had<br />the total market. So people had to go to LIC for buying life insurance policy. But after the entry of private players in 2000, some people have also turned to private life insurers.<br />AegonReligare Life Insurance Company Limited is newly launched company. So it has fewer customers as compared to LIC. But the ULIP plans are sold more of AegonReligare life insurance as compared to LIC in today’s environment. Now let’s see what people say:<br /> Particulars No.<br />Aegon Religare Life Insurance 15<br />LIC 35<br />TOTAL 50<br />As evident from the chart that 30% of people would prefer AegonReligare Life Insurance while 70% would prefer LIC.<br />Personal Details: -<br />1) Age<br />(a) 18 to 30<br />(b) 31 to 50<br />(c) 51 to 65<br />Age No.<br />18 to 30 5<br />31 to 50 30<br />51 to 65 15<br />TOTAL 50<br />As evident from the chart that I have taken a sample of 50. Out of which 10% people are aged between 18 to 30, 60% people are aged between 31 to 50, and remaining 30% people are aged between 51 to 65.<br />2) Occupation<br />(a) Service<br />(b) Business<br />(c) Profession<br />(d) Housewife<br />(e) Retired<br />Occupation No.<br />Service 5<br />Business 15<br />Profession 10<br />Housewife 5<br />Retired 15<br />TOTAL 50<br />As the evident from the chart that out of 50 respondents 10% are of service men, 30% are of business men, 20% are of professions, 10% are of housewives and remaining 30% are of retired<br />3) Income<br />(a) 50,000 to 1,00,000<br />(b) 1,00,000 to 5,00,000<br />(c) More than 5,00,000<br />Income (Per Annum) No.<br />50,000 to 1,00,000 10<br />1,00,000 to 5,00,000 25<br />More than 5,00,000 15<br />TOTAL 50<br />As the evident from the chart out of 50 respondents 20% are earning annually between 50,000 to 1,00,000, 50% are earning between 1,00,000 to 5,00,000 and 30% are earning more than 5,00,000.<br />4) Family members<br />(a) 2<br />(b) 3<br />(c) 4<br />(d) More than 4<br />Family Members No.<br />2 5<br />3 15<br />4 20<br />More than 4 10<br />TOTAL 50<br />As the evident from the chart out of 50 respondents 10% have 2 family members, 30% have 3 family members, 40% have 4 family members and remaining 20% have more than 4 family members.<br />7.9 SWOT ANALYSIS<br />SWOT analysis is the analysis of the internal and external factors, which have impact on the survival of any organization. Now let’s make SWOT analysis for reliance Life Insurance Company Limited.<br />☻STRENGTHS:<br />1) The brand name is enough to sell the products easily.<br />2) Private placement of Rs. 10,000 crs worth of securities with RBI by the government. Led to an improvement in market securities.<br />3) Strong liquidity from FII was the major reason for the up move.<br />4) Range of products<br />5) Religare has a long and strong history of solvency, financial<br />stability.<br />▼WEAKNESSES:<br />1) Newly established company, so people seems it risky.<br />2) Lack of staff.<br />3) Lack of advertisement, so most of the customers are not aware of the AegonReligare Life Insurance.<br />☼ OPPORTUNITY:<br />1) There is a vast untapped market in India. The life insurance<br />penetration in India is approximately 2.5%. So it has large<br />potential.<br />2) Intention of traditional products is to encourage long term,<br />regular and disciplined savings to systematically build up a<br />target fund.<br />3) The average insurance premium being collected by the<br />company has been growing exponentially year on year.<br />● THREATS:<br />1) The main threat is from the other players who have grabbed<br />approximately 15% of the market share.<br />2) As the government has scrapped the rebate on the life insurance premium, the people who used to invest in life insurance for the sole motive of tax benefit may turn to other instruments.<br />CONCLUSION<br /><ul><li>After the deep study of insurance sector of India, I can tell that this is the sector, which has most business opportunities perhaps in India.
  43. 43. Insurance industry is one of the fastest sectors in India. Insurance sector has been growing by 25% to 30% and it is expected to increase by 50% in coming 5 years. After the opening up of the insurance sector, it has become much competitive and insurance awareness among people has increased.
  44. 44. As far as the comparison of Reliance Life Insurance and other players is concerned, there are both positive as well as negative impacts on both the sides.
  45. 45. For Aegon Religare Life Insurance, the negative aspect is that its market share is low.
  46. 46. For private players the negative aspect is that they have to fight with the public sector giant which is established player with a high brand value.
  47. 47. But the positive impact is that the life insurance awareness has increased and the business of Reliance Life Insurance has increased.</li></ul>CHAPTER – 10<br />ANNEXURE<br />􀂾 Questionnaire<br />Survey by student of IITTM<br />On Life Insurance<br />NAME: ___Aegon Religare ________________________________________<br />Q.1 What is your main motive behind investing in life insurance?<br />(a) Tax Benefit<br />(b) Savings<br />(c) Risk Cover<br /> (d) Return/Yield<br />Q.3 How do you decide about investing in life insurance?<br />(a) On my own<br />(b) family decision<br />(c) Employer decides<br />(d) as per the guidance of agent<br />Q.4. Which life insurance policy would you prefer to buy?<br />(a) Term Assurance<br />(b) Whole Life<br />(c) Endowment<br />(d) Combination of Whole Life and Endowment<br />(e) Unit Linked<br />Q.5 Would you prefer Reliance Life Insurance or LIC for buying the<br />life insurance policy?<br />(a) Reliance Life Insurance<br />(b) LIC<br />PERSONAL DETAILS<br />1) Age<br />(a) 18 to 30<br />(b) 31 to 50<br />(c) 51 to 65<br />2) Occupation<br />(a) Service<br />(b) Business<br /> (c) Profession<br />(d) Housewife<br />(e) Retired<br />3) Income<br />(a) 50,000 to 1,00,000<br />(b) 1,00,000 to 5,00,000<br />(c) More than 5,00,000<br />4) Family members<br />(a) 2<br />(b) 3<br />(c) 4<br />(d) More than<br />CHAPTER – 9<br />BIBLIOGRAPHY AND REFERENCES<br /><ul><li></li></ul> <br /><br /><br /><br />􀂾<br /><ul><li> Life Time Magazine of AegonReligare Life Insurance.
  48. 48. Net Bios Computer Academy’s Life Insurance Book.
  49. 49. Broachers of AegonReligare Life Insurance.