“CHANNEL DEVELOPMENT AT MAX NEW
YORK LIFE”
SUBMITTED BY:-
MRUNAL DATTATRAYA SAMANT.
MBA (III RD SEM)
UNDER THE GUIDANCE OF...
CHANNEL DEVELOPMENT AT MNYL.
ACADEMIC YEAR 2006-2008
CERTIFICTE OF APPROVAL
The following Summer Project Report Title “Cha...
CHANNEL DEVELOPMENT AT MNYL.
- 3 -
CHANNEL DEVELOPMENT AT MNYL.
CERTIFICATE FROM SUMMER PROJECT GUIDE.
This is to certify that Mr. Mrunal Dattatraya Samant a...
CHANNEL DEVELOPMENT AT MNYL.
ABSTRACT.
- 5 -
CHANNEL DEVELOPMENT AT MNYL.
ACKNOWLEDGEMENT
It gives me immense pleasure, having done a project on an interesting and
kno...
CHANNEL DEVELOPMENT AT MNYL.
Above all it gives me immense pleasure to thank authors of various books who
indirectly helpe...
CHANNEL DEVELOPMENT AT MNYL.
Indian insurance industry is emerging rapidly after year 2000. To survive in this
highly comp...
CHANNEL DEVELOPMENT AT MNYL.
• Strategies for recruitment.
• Eligibility of recruitment and so on.
In this project I have ...
CHANNEL DEVELOPMENT AT MNYL.
TABLE OF CONTENTS.
Acknowledgement
5
Preface
7
Table of Contents
9
List of Abbreviations
11
-...
CHANNEL DEVELOPMENT AT MNYL.
- 11 -
SECTION A: INTRODUCTION 13
A.1 ABOUT INSURANCE INDUSTRY 14
A.2 ABOUT MAX NEW YORK LIFE...
CHANNEL DEVELOPMENT AT MNYL.
LIST OF ABBREVIATIONS.
MNYL Max New York Life
AA Agent Advisor
PO Personal Observation
NAT Nu...
CHANNEL DEVELOPMENT AT MNYL.
• Personal observation.
Personal Observation can be defined as: a face to face contact made o...
CHANNEL DEVELOPMENT AT MNYL.
Section A
INTRODUCTION.
- 14 -
CHANNEL DEVELOPMENT AT MNYL.
A.1 About the Insurance Sector in India
• Insurance sector is an opportunity for India.
• Thi...
CHANNEL DEVELOPMENT AT MNYL.
Historical Perspective
• In 1818 it was conceived as a means to provide for English Widows.
•...
CHANNEL DEVELOPMENT AT MNYL.
• The Government of India in 1956, brought together over 240 private life
insurers and provid...
CHANNEL DEVELOPMENT AT MNYL.
Insurance Sector Reforms
- 18 -
CHANNEL DEVELOPMENT AT MNYL.
In 1993, Malhotra Committee- headed by former Finance Secretary and RBI
Governor R.N. Malhotr...
CHANNEL DEVELOPMENT AT MNYL.
than 5% in any company (there current holdings to be brought down to this
level over a period...
CHANNEL DEVELOPMENT AT MNYL.
The Government of India liberalised the insurance sector in March 2000 with the
passage of th...
CHANNEL DEVELOPMENT AT MNYL.
The Life Insurance market in India is an underdeveloped market that was only
tapped by the st...
CHANNEL DEVELOPMENT AT MNYL.
Innovative products, smart marketing and aggressive distribution. That's the
triple whammy co...
CHANNEL DEVELOPMENT AT MNYL.
A.2 ABOUT MAX NEW YORK LIFE
• Max New York Life Insurance Company Ltd. is a joint venture bet...
CHANNEL DEVELOPMENT AT MNYL.
Career seminar
Final interview.
• The agent advisors are trained in-house to ensure optimal c...
CHANNEL DEVELOPMENT AT MNYL.
• These include the franchisee model, rural business, direct sales force
involving group insu...
CHANNEL DEVELOPMENT AT MNYL.
1) Premium Leader
- 27 -
C
E
MDRT
Ex. Council
Paul Colgan Trophy
Centurion
Agent of the Year
...
CHANNEL DEVELOPMENT AT MNYL.
Qualifying Criteria- Rs. 1 Lakh AFYP in a month
Reward and Recognition- Mention in leaders Re...
CHANNEL DEVELOPMENT AT MNYL.
month 3
Reward and Recognition- Recognition Award
5) Career Producer Award
Qualifying Criteri...
CHANNEL DEVELOPMENT AT MNYL.
Reward and Recognition- Recognition Plaque
8) Agent of the Year
Qualifying Criteria- Highest ...
CHANNEL DEVELOPMENT AT MNYL.
Reward and Recognition- Recognition Trophy
11) Executive Council
Qualifying Criteria- July 20...
CHANNEL DEVELOPMENT AT MNYL.
domestic travel and Visa costs.
13) CEO’S Council
Qualifying Criteria- July 2006 to June 2007...
CHANNEL DEVELOPMENT AT MNYL.
• Endowment Plans
• Children Plan
• Money Back Plans
• Pension Plans
• Health & Accident Rela...
CHANNEL DEVELOPMENT AT MNYL.
Be the brand of the first Choice.
Be the Employer of the Choice.
Become principal of choice f...
CHANNEL DEVELOPMENT AT MNYL.
Max New York Life has been instrumental in changing the paradigm of life
insurance in India. ...
CHANNEL DEVELOPMENT AT MNYL.
- 36 -
CHANNEL DEVELOPMENT AT MNYL.
A.3 ABOUT PROJECT
The main objective of the “Channel Development” is to recruit quality agent...
CHANNEL DEVELOPMENT AT MNYL.
Company’s Expectation from AA:
• Regular input activity.
• Follow the sales process.
• Achiev...
CHANNEL DEVELOPMENT AT MNYL.
Section B
CHANNEL DEVELOPMENT STRATEGIES.
- 39 -
CHANNEL DEVELOPMENT AT MNYL.
B.1 ELIGIBILTY MODEL
From this eligibility model company judge prospective person. The compan...
CHANNEL DEVELOPMENT AT MNYL.
• Other criteria for AA selection:
1. Financial stability:
MNYL is focuses on classes and not...
CHANNEL DEVELOPMENT AT MNYL.
7. Excellent communication skills:
Since AA needs to communicate about the organization, prod...
CHANNEL DEVELOPMENT AT MNYL.
Management team has developed certain strategies in order to expand
channel distribution netw...
CHANNEL DEVELOPMENT AT MNYL.
• Natural Market:
A natural market consist of people to whom you know well from your
family, ...
CHANNEL DEVELOPMENT AT MNYL.
Prospects itself are approached. They can be anyone from natural
market, Nominator’s referenc...
CHANNEL DEVELOPMENT AT MNYL.
COLD/ WARM/ HOT
This is another method that helps the management trainee and the sales
manage...
CHANNEL DEVELOPMENT AT MNYL.
Cold is like what u are having. In this column we include all the names
which we have as a pr...
CHANNEL DEVELOPMENT AT MNYL.
QUESTIONNAIRE
Hello. This is MRUNAL D. SAMANT from Max New York Life, working here as a
manag...
CHANNEL DEVELOPMENT AT MNYL.
2. Name any 3 Insurance Companies you are aware of?
a. _____________________________________
...
CHANNEL DEVELOPMENT AT MNYL.
_________________________________________
4. Are you aware of any Insurance products?
a. ____...
CHANNEL DEVELOPMENT AT MNYL.
b. Investment
c. Tax Benefits
TAX BENEFIT
SECURITY
INVESTMENT
7. Are you aware of the earning...
CHANNEL DEVELOPMENT AT MNYL.
a. Yes
b. No
YES
NO
9. Which is the quality according to you that would be required for
Being...
CHANNEL DEVELOPMENT AT MNYL.
______________________________________
CONTACT NO.: ______________________________________
AN...
CHANNEL DEVELOPMENT AT MNYL.
modifies the versions of the scripts if needed as per requirement. All the
mangers are requir...
CHANNEL DEVELOPMENT AT MNYL.
found to be unlisted it is responsibility of SM to bring back in the spirit of original
scrip...
CHANNEL DEVELOPMENT AT MNYL.
Section C
CHANNEL DEVELOPMENT PROCESS.
- 56 -
CHANNEL DEVELOPMENT AT MNYL.
Flow Based approach to Channel Development Process
- 57 -
YES
NO
NO
YES
StartStart
Name Gathe...
CHANNEL DEVELOPMENT AT MNYL.
C.1 NAME GATHERING IN P200
Name gathering in P200 consists of people whom you know from natur...
CHANNEL DEVELOPMENT AT MNYL.
Candidates are called either as nominator, CoI, Prospective Agents and a
meeting is fixed wit...
CHANNEL DEVELOPMENT AT MNYL.
All the prospects are required to attend career seminar at MNYL which provides
broader aspect...
CHANNEL DEVELOPMENT AT MNYL.
60 Cold prospects.
20 Initial screening.
16 Test.
08 Seminar.
04 Career Interview.
02 FCS Bat...
CHANNEL DEVELOPMENT AT MNYL.
Section D
STATUS REPORT.
- 62 -
CHANNEL DEVELOPMENT AT MNYL.
D.1 ACTIVITY CHART
Particulars Status
1) Initial Screening 30
2) NAT 6
3) Career Seminar 8
4)...
CHANNEL DEVELOPMENT AT MNYL.
SECTION E
CONCLUSION
- 64 -
CHANNEL DEVELOPMENT AT MNYL.
E.1EXPERIENCE
My Experience with MNYL will always be grateful for me. I learned many things
i...
CHANNEL DEVELOPMENT AT MNYL.
Life insurance business in terms of first year premium has shown a growth of
more than 95% ov...
CHANNEL DEVELOPMENT AT MNYL.
Max New York Life as an insurance firm has a very strong presence in India and
is rapidly exp...
CHANNEL DEVELOPMENT AT MNYL.
• Very less people know about highlights of the company.
• Firm is not well known though it i...
CHANNEL DEVELOPMENT AT MNYL.
• IC 33 book of Max New York Life.
• www.maxnewyorklife.com
• www.google.com
- 69 -
CHANNEL DEVELOPMENT AT MNYL.
- 70 -
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  1. 1. “CHANNEL DEVELOPMENT AT MAX NEW YORK LIFE” SUBMITTED BY:- MRUNAL DATTATRAYA SAMANT. MBA (III RD SEM) UNDER THE GUIDANCE OF: INDIAN INSTITUTE OF PLANNING AND MANAGEMENT, MUMBAI.
  2. 2. CHANNEL DEVELOPMENT AT MNYL. ACADEMIC YEAR 2006-2008 CERTIFICTE OF APPROVAL The following Summer Project Report Title “Channel Development at MNYL” is hereby approved as certificate studies in management carried out in a manner satisfactory to warrant its acceptance as a prerequisite for the award of Post Graduate Diploma in Business Management for which they have been submitted. It is understood that by this approval the undersigned do not necessarily endorse or approve any statement made, opinion expressed or conclusion drawn therein but approve the summer Project only for the purpose it is submitted. Summer Project Report Examination Committee for evaluation of Summer Project Report. Name Signature 1. Faculty Examiner _________________ _________________ 2. PG Summer Project Co-coordinator___________________ ___________________ - 2 -
  3. 3. CHANNEL DEVELOPMENT AT MNYL. - 3 -
  4. 4. CHANNEL DEVELOPMENT AT MNYL. CERTIFICATE FROM SUMMER PROJECT GUIDE. This is to certify that Mr. Mrunal Dattatraya Samant a student of Post Graduate Diploma in Business Management has worked under our guidance and supervision. This Summer Project Report has the requisite standard and to the best of our knowledge no part of it has been reproduced from any other summer project, monograph, report or book. Project Guide Project Guide Date: Date: - 4 -
  5. 5. CHANNEL DEVELOPMENT AT MNYL. ABSTRACT. - 5 -
  6. 6. CHANNEL DEVELOPMENT AT MNYL. ACKNOWLEDGEMENT It gives me immense pleasure, having done a project on an interesting and knowledgeable topic like “Channel development at Max New York.” This project has not only widened my horizon as far as academics are concerned but also helped me to enlarge my knowledge bank. Marketing Management and Human resources are not topics, which could be handled with certain amount of casualty. It requires a deep study and hard work, which is key to success. There are many people associated with this project without which this project would not have been possible. I thank my Institute who has given me an opportunity to show my skills. I also thank all my nearer and dearer ones without whose support this project would not been possible. I would like to thank Mr. Manish Saklani, who allow me to do this project in Max New York Life successfully. I am deeply grateful to Mr. Alok Ghosh, my project guide for his ever willing help and guidance to complete my project successfully. I would like to thank to Mr. Mainak Pramanik, my Sales Manager for his nobel inspiration, keen interest, constant supervision and ever willing help throughout the course of this study. Above all I would like to thank all contacted persons of firm who took out valuable time to answer my queries and gave me full information about insurance industry and Max New York Life. I extend my sincere gratitude towards my parents, who have always encouraged me and gave suggestions as how to work on project. They always stand by me in solving all my queries. Their support has always motivated me. - 6 -
  7. 7. CHANNEL DEVELOPMENT AT MNYL. Above all it gives me immense pleasure to thank authors of various books who indirectly helped me in gaining knowledge about insurance industry. PREFACE - 7 -
  8. 8. CHANNEL DEVELOPMENT AT MNYL. Indian insurance industry is emerging rapidly after year 2000. To survive in this highly competitive scenario, managers are being pressured to improve quality, recruit quality and skilled people and eliminate inefficiency. The collective efforts of the employer, managers and other relative people assume relevance in this context. And this is where marketing management and human resources play important role. Recruitment is very important in today’s scenario. But still it is ignored and considered as a secondary aspect. In case of insurance industry recruitment only decide success or failure of company. I have made an attempt to study this aspect of Insurance industry in my project. In this project, recruitment for developing channel at Max New York Life is considered. I have tried to find out how exactly recruitment is very important for this firm as well as this industry, which are the different strategies firm use to recruit quality people and so on. It is more qualitative rather than a quantitative data. To get knowledge of above question and to fulfill the requirements for my project on “Channel Development At Max New York Life”, I have worked in MNYL and searched some internet sites. On the basis of my study, I have included following topics as the important aspect of Channel Development At Max New York Life. • Insurance industry introduction. - 8 -
  9. 9. CHANNEL DEVELOPMENT AT MNYL. • Strategies for recruitment. • Eligibility of recruitment and so on. In this project I have tried to give attention to all the above topics and study them in depth. But I would still like to receive all sorts feedback to enhance my knowledge on the topics as far as this industry is concern. - 9 -
  10. 10. CHANNEL DEVELOPMENT AT MNYL. TABLE OF CONTENTS. Acknowledgement 5 Preface 7 Table of Contents 9 List of Abbreviations 11 - 10 -
  11. 11. CHANNEL DEVELOPMENT AT MNYL. - 11 - SECTION A: INTRODUCTION 13 A.1 ABOUT INSURANCE INDUSTRY 14 A.2 ABOUT MAX NEW YORK LIFE 23 A.3 ABOUT PROJECT 35 SECTION B: CHANNEL DEVELOPMENT STRATEGIES 37 B.1 ELIGIBILITY MODEL 38 B.2 DEVELOPMENT STRATEGIES 41 B.3 SCRIPTS AND OBJECTION HANDLING 52 SECTION C: CHANNEL DEVELOPMENT PROCESS 54 C.1 NAME GATHERING IN-P200 56 C.2 SHORTLISTING 56 C.3 APPROACHING 57 C.4 INITIAL SCREENING 57 C.5 NAT 58 C.6 CAREER SEMINAR 58 C.7 CAREER INTERVIEW 58 C.8 FCS 58 C.9 CONTRACT 58 SECTION D: STATUS REPORT 60 D.1 ACTIVITIY CHART 61 SECTION E: CONCLUSION 62 E.1 EXPERIENCE 63 E.2 SUMMARY 64 E.3 RECOMMENDATION 65 E.4 BIBLIOGRAPHY 67
  12. 12. CHANNEL DEVELOPMENT AT MNYL. LIST OF ABBREVIATIONS. MNYL Max New York Life AA Agent Advisor PO Personal Observation NAT Numerical Ability Test FCS Fundamental Career Seminar IRDA Insurance Regulatory & Development Authority CoI Centre of Influence ATP Annual Target Premium MDRT Million Dollar Round Table CSR Corporate Social Responsibility SM Sales Manager SCA Sustainable Competitive Advantage - 12 -
  13. 13. CHANNEL DEVELOPMENT AT MNYL. • Personal observation. Personal Observation can be defined as: a face to face contact made on an important basis in order to secure an appointment for recruitment interview. • Nominator. Nominators can be defined as: people with whom you have no previous business relationship. • CoI. Centers of influence can be defined as: people with whom you already have an established relationship for referrals as an agent. - 13 -
  14. 14. CHANNEL DEVELOPMENT AT MNYL. Section A INTRODUCTION. - 14 -
  15. 15. CHANNEL DEVELOPMENT AT MNYL. A.1 About the Insurance Sector in India • Insurance sector is an opportunity for India. • This business is growing at the rate of 18-22 per cent annually. • Presently it covers market of RS.450 billion. • Together with banking sector it contributes about 7% to GDP. • Gross premium collection is about 2% of GDP. • Still 80% of Indian population is without life insurance. • This is an indicator that growth potential for the insurance sector is immense. • Insurance sector contribute a lot in economic development. • It provides long term fund for infrastructure development. • It is estimated that over the next ten years India would require investments of the order of one trillion US dollar. • The Insurance sector, to some extent, can enable investments in infrastructure development to sustain economic growth of the country. There are two legislations that govern the sector- The Insurance Act- 1938 The IRDA Act- 1999. - 15 -
  16. 16. CHANNEL DEVELOPMENT AT MNYL. Historical Perspective • In 1818 it was conceived as a means to provide for English Widows. • The Bombay Mutual Life Insurance Society started its business in 1870. • It was the first company to charge same premium for both Indian and non-Indian lives. • The Oriental Assurance Company was established in 1880. • Till the end of nineteenth century insurance business was almost entirely in the hands of overseas companies. • Insurance regulation formally began in India with the passing of the Life Insurance Companies Act of 1912 and the provident fund Act of 1912. • Several frauds during 20's and 30's sullied insurance business in India. • By 1938 there were 176 insurance companies. • The first comprehensive legislation was introduced with the Insurance Act of 1938 that provided strict State Control over insurance business. • The insurance business grew at a faster pace after independence. - 16 -
  17. 17. CHANNEL DEVELOPMENT AT MNYL. • The Government of India in 1956, brought together over 240 private life insurers and provident societies under one nationalized monopoly corporation and Life Insurance Corporation (LIC) was born. • Nationalization was justified on the grounds that it would create much needed funds for rapid industrialization. Important milestones in the life insurance business in India: - 17 -
  18. 18. CHANNEL DEVELOPMENT AT MNYL. Insurance Sector Reforms - 18 -
  19. 19. CHANNEL DEVELOPMENT AT MNYL. In 1993, Malhotra Committee- headed by former Finance Secretary and RBI Governor R.N. Malhotra- was formed to evaluate the Indian insurance industry and recommend its future direction. The Malhotra committee was aimed at creating a more efficient and competitive financial system suitable for the requirements of the economy keeping in mind the structural changes currently underway and recognising that insurance is an important part of the overall financial system where it was necessary to address the need for similar reforms. In 1994, the committee submitted the report and some of the key recommendations included: i) Structure: Government stake in the insurance Companies to be brought down to 50%. Government should take over the holdings of GIC and its subsidiaries so that these subsidiaries can act as independent corporations. All the insurance companies should be given greater freedom to operate. ii) Competition: Private Companies with a minimum paid up capital of Rs.1bn should be allowed to enter the sector. No Company should deal in both Life and General Insurance through a single entity. Foreign companies may be allowed to enter the industry in collaboration with the domestic companies. Postal Life Insurance should be allowed to operate in the rural market. Only one State Level Life Insurance Company should be allowed to operate in each state. iii) Regulatory Body: The Insurance Act should be changed. An Insurance Regulatory body should be set up. Controller of Insurance- a part of the Finance Ministry- should be made independent iv) Investments: Mandatory Investments of LIC Life Fund in government securities to be reduced from 75% to 50%. GIC and its subsidiaries are not to hold more - 19 -
  20. 20. CHANNEL DEVELOPMENT AT MNYL. than 5% in any company (there current holdings to be brought down to this level over a period of time) v) Customer Service: LIC should pay interest on delays in payments beyond 30 days. Insurance companies must be encouraged to set up unit linked pension plans. Computerization of operations and updating of technology to be carried out in the insurance industry. The committee felt the need to provide greater autonomy to insurance companies in order to improve their performance and enable them to act as independent companies with economic motives. For this purpose, it had proposed setting up an independent regulatory body- The Insurance Regulatory and Development Authority. Reforms in the Insurance sector were initiated with the passage of the IRDA Bill in Parliament in December 1999. The IRDA since its incorporation as a statutory body in April 2000 has fastidiously stuck to its schedule of framing regulations and registering the private sector insurance companies. Since being set up as an independent statutory body the IRDA has put in a framework of globally compatible regulations. The other decision taken simultaneously to provide the supporting systems to the insurance sector and in particular the life insurance companies was the launch of the IRDA online service for issue and renewal of licenses to agents. The approval of institutions for imparting training to agents has also ensured that the insurance companies would have a trained workforce of insurance agents in place to sell their products. Present Scenario - 20 -
  21. 21. CHANNEL DEVELOPMENT AT MNYL. The Government of India liberalised the insurance sector in March 2000 with the passage of the Insurance Regulatory and Development Authority (IRDA) Bill, lifting all entry restrictions for private players and allowing foreign players to enter the market with some limits on direct foreign ownership. Under the current guidelines, there is a 26 percent equity cap for foreign partners in an insurance company. There is a proposal to increase this limit to 49 percent. The opening up of the sector is likely to lead to greater spread and deepening of insurance in India and this may also include restructuring and revitalizing of the public sector companies. In the private sector 15 life insurance companies have been registered. A host of private Insurance companies operating in life segments have started selling their insurance policies since 2001. Table shows the current market players in the life Insurance Industry (Source IRDA). Sr. No. Name of the Company 1 Bajaj Allianz Life Insurance Co. Limited 2 Birla Sun Life Insurance Co. Ltd 3 HDFC Standard Life Insurance Co. Ltd 4 ICICI Prudential Life Insurance Co. Ltd 5 ING Vysya Life Insurance Co. Ltd. 6 Life Insurance Corporation of India 7 Max New York Life Insurance Co. Ltd 8 Met Life India Insurance Co. Pvt. Ltd. 9 Kotak Mahindra Old Mutual Life Insurance Ltd. 10 SBI Life Insurance Co. Ltd. 11 Tata AIG Life Insurance Co. Ltd. 12 Reliance Life Insurance Co. Ltd. 13 Aviva Life Insurance Co. India Pvt. Ltd. 14 Sahara India Life Insurance Co. Ltd. 15 Shriram Life Insurance Co. Ltd. 16 Bharti AXA Life Insurance Co. Ltd. Life Insurance Market Growth - 21 -
  22. 22. CHANNEL DEVELOPMENT AT MNYL. The Life Insurance market in India is an underdeveloped market that was only tapped by the state owned LIC till the entry of private insurers. The penetration of life insurance products was 22 percent of the total 400 million of the insurable population. Most customers were under- insured with no flexibility or transparency in the products. With the entry of the private insurers the rules of the game have changed. Life insurance business in terms of first year premium has shown a growth of more than 95% over the previous year and non life, or general insurance, is not far behind either, growing at 22% during 2006-07.The 15 private insurers in the life insurance market have already grabbed nearly 24 percent of the market in terms of premium income. The new business premium of the 15 private players has tripled over last year. Meanwhile, state owned LIC's new premium business has fallen. Figure shows comparison between premiums being collected by private and public limited players in year 2006 and 2007. - 22 -
  23. 23. CHANNEL DEVELOPMENT AT MNYL. Innovative products, smart marketing and aggressive distribution. That's the triple whammy combination that has enabled fledgling private insurance companies to sign up Indian customers faster than anyone ever expected. Indians, who have always seen life insurance as a tax saving device, are now suddenly turning to the private sector and snapping up the new innovative products on offer. The growing popularity of the private insurers shows in other ways. They are coining money in new niches that they have introduced. The state owned companies still dominate segments like endowments and money back policies. But in the annuity or pension products business, the private insurers have already wrested over 33 percent of the market. And in the popular unit-linked insurance schemes they have a virtual monopoly, with over 90 percent of the customers. The private insurers also seem to be scoring big in other ways- they are persuading people to take out bigger policies. For instance, the average size of a life insurance policy before privatisation was around Rs 50,000. That has risen to about Rs 80,000. But a rejuvenated LIC is also trying to fight back to persuade new customers. - 23 -
  24. 24. CHANNEL DEVELOPMENT AT MNYL. A.2 ABOUT MAX NEW YORK LIFE • Max New York Life Insurance Company Ltd. is a joint venture between New York Life and Max India Limited. • New York Life is a Fortune 100 company and Max India Limited is one of India's leading multi-business corporations. • The company has positioned itself on the quality platform. • It has developed a strong corporate governance model based on the core values of excellence, honesty, knowledge, caring, integrity and teamwork. • The strategy is to establish itself as a trusted life insurance specialist through a quality approach to business. • 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 is Rs. 657 crore, which is more than the norm laid down by IRDA. • Max New York Life has identified individual agents as its primary channel of distribution. • The Company places a lot of emphasis on its selection process, which comprises four stages – Screening, Psychometric test, - 24 -
  25. 25. CHANNEL DEVELOPMENT AT MNYL. Career seminar Final interview. • The agent advisors are trained in-house to ensure optimal control on quality of training. • Max New York Life invests significantly in its training programme. • Each agent is trained for 152 hours as opposed to the mandatory 100 hours stipulated by the IRDA before beginning to sell in the marketplace. • Training is a continuous process for agents at Max New York Life and ensures development of skills and knowledge through a structured programme spread over 500 hours in two years. • This focus on continuous quality training has resulted in the company having amongst the highest agent pass rate in IRDA examinations and the agents have the highest productivity among private life insurers. • 201 agent advisors have qualified for the Million Dollar Round Table (MDRT) membership in 2005. • MDRT is an exclusive congregation of the world’s top selling insurance agents and is internationally recognized as the standard of excellence in the life insurance business. • Having set a best in class agency distribution model in place, the company is spearheading a major thrust into additional distribution channels to further grow its business. • The company is using a five-pronged strategy to pursue alternative channels of distribution. - 25 -
  26. 26. CHANNEL DEVELOPMENT AT MNYL. • These include the franchisee model, rural business, direct sales force involving group insurance and telemarketing opportunities and corporate alliances. • Max New York Life offers a suite of flexible products. • It now has 26 life insurance products and 8 riders that can be customized to have more than 400 products. REWARD AND RECOGNITION - 26 -
  27. 27. CHANNEL DEVELOPMENT AT MNYL. 1) Premium Leader - 27 - C E MDRT Ex. Council Paul Colgan Trophy Centurion Agent of the Year Paid Cases, FYC, Persistency, Rider, Referral and CEIP Leader Career Foundation Club Career Producer Award Career Success Award Hi-Flier Ten-A-Monther Premium Leader
  28. 28. CHANNEL DEVELOPMENT AT MNYL. Qualifying Criteria- Rs. 1 Lakh AFYP in a month Reward and Recognition- Mention in leaders Report, Lunch 2) Ten-A-Monther Qualifying Criteria- 10 applications in a month and Rs. 30,000 AFYP Reward and Recognition- MNYL Crystal Glass, mention in Leaders Report, Lunch. 3) Hi-Flier Qualifying Criteria- 20 applications in a month Reward and Recognition- MNYL Silver Medal, MNYL Crystal Glass, Mention in leaders Report, Lunch 4) Career Success Award Qualifying Criteria- 15 paid cases & Rs. 40,000 FYC at the end of - 28 -
  29. 29. CHANNEL DEVELOPMENT AT MNYL. month 3 Reward and Recognition- Recognition Award 5) Career Producer Award Qualifying Criteria- 25 paid cases & Rs. 80,000 FYC at the end of month 6 Reward and Recognition- Recognition Award 6) Career Foundation Club Qualifying Criteria- 50 paid cases & Rs. 1.8 lakhs FYC in July- June for Recruits during this period. Reward and Recognition- Attend CFC meeting to be held at Zone level 7) Paid Case, FYC, Persistency, rider, Referral and CEIP Leader Qualifying Criteria- Top Agent in each category in each GO - 29 -
  30. 30. CHANNEL DEVELOPMENT AT MNYL. Reward and Recognition- Recognition Plaque 8) Agent of the Year Qualifying Criteria- Highest Points in each GO Reward and Recognition- Recognition Award 9) Centurion Qualifying Criteria- 100 net paid cases in a year Reward and Recognition- Centurion Trophy 10) Paul Colgan Trophy Qualifying Criteria- Highest FYC with 100 or more paid cases and 95% Or more 13th month persistency - 30 -
  31. 31. CHANNEL DEVELOPMENT AT MNYL. Reward and Recognition- Recognition Trophy 11) Executive Council Qualifying Criteria- July 2006 to June 2007: 4,30,000 Council Credits January 07 to June 07: 1,60,000 Council Credits 40 paid cases in the Council Period. Reward and Recognition- Trip to Malaysia to attend the Executive Council Meeting. 12) MDRT (Million Dollar Round Table) Qualifying Criteria- MDRT FYC Rs. 7,19,800 Premium Rs.14,39,600 Reward and Recognition- MDRT dues for all qualifiers. Top 35 by FYC will Bear domestic travel and visa costs. Next 15 will bear Registration fees, domestic travel and visa costs. Rest All will bear international airfare, - 31 -
  32. 32. CHANNEL DEVELOPMENT AT MNYL. domestic travel and Visa costs. 13) CEO’S Council Qualifying Criteria- July 2006 to June 2007: 8,00,000 Council Credits Jan 2007 to June 2007: 3,20,000 Council Credits Reward and Recognition- Trip to Amsterdam to attend the CEO Council meeting. PRODUCTS OF MNYL • Whole Life Plans • Unit Linked Insurance Plans - 32 -
  33. 33. CHANNEL DEVELOPMENT AT MNYL. • Endowment Plans • Children Plan • Money Back Plans • Pension Plans • Health & Accident Related Riders Vision To become the most admired life Insurance Company in India. Mission To become one of the top quartile life Insurance companies in India. Be a national player. - 33 -
  34. 34. CHANNEL DEVELOPMENT AT MNYL. Be the brand of the first Choice. Be the Employer of the Choice. Become principal of choice for agents. 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: Achievements  First life insurance Company in India to have IS0 9001:2000 certifications.  Top five most respected private life insurance in India according to Business World survey.  Continuous presence in Top 50 MDRT global list. CSR - 34 -
  35. 35. CHANNEL DEVELOPMENT AT MNYL. Max New York Life has been instrumental in changing the paradigm of life insurance in India. It is the first life insurance company in India to introduce cause related marketing. Children are at the very heart of Max New York Life's strategy. SOS Children's Villages of India is internationally recognized for its work in giving underprivileged children a wholesome life. The mission of SOS is "to help orphaned and abandoned children, by providing them with a family, a permanent home, education and strong foundation for an independent life." It's mission ties in with Max New York Life's philosophy of helping people secure the future of their near and dear ones. The company donates a part of the total money collected on all policies sold, to SOS Children's Villages of India at the end of the year. Leadership Team - 35 -
  36. 36. CHANNEL DEVELOPMENT AT MNYL. - 36 -
  37. 37. CHANNEL DEVELOPMENT AT MNYL. A.3 ABOUT PROJECT The main objective of the “Channel Development” is to recruit quality agent advisors (AA) for the company for providing life Insurance solutions to the customers. AA plays a vital role in the growth of company with respect of company’s earnings as well as they create value for the organization after achieving some milestones. AA are integral part of the team and sales manager assigned to them help them to groom them in terms of personality development, selling skills and handling objections of customers. Benefits of Becoming AA for MNYL: - 37 -
  38. 38. CHANNEL DEVELOPMENT AT MNYL. Company’s Expectation from AA: • Regular input activity. • Follow the sales process. • Achieve sales targets. • Attend training programme. • Participate in weekly reviews. • Follow the MNYL ethics and business standards policy. - 38 -
  39. 39. CHANNEL DEVELOPMENT AT MNYL. Section B CHANNEL DEVELOPMENT STRATEGIES. - 39 -
  40. 40. CHANNEL DEVELOPMENT AT MNYL. B.1 ELIGIBILTY MODEL From this eligibility model company judge prospective person. The company follows unique eligibility criteria for AA selection by which company is able is to always justify its mission. The basic objective of having an eligibility model for recruitment is to have good retention and greater effectiveness in the delivery of service. • Four criteria’s for AA selection 1. 25 plus years of age: This age shows attainment of maturity and responsibility. People are more consistent in this age. 2. Married: Married people have more eager to earn money. Family pressures increase responsibility and secondly customers are convinced more by the stability of a married AA. 3. Staying in the same city for more than 5 years: Person who stays more than 5 year has huge natural market which helps him to get more business in short period. 4. Graduate: Graduate people have basic skills like communication skills, numerical ability, I.P relation, convincing abilities etc. so it is easy to teach them further. - 40 -
  41. 41. CHANNEL DEVELOPMENT AT MNYL. • Other criteria for AA selection: 1. Financial stability: MNYL is focuses on classes and not on masses thus they select strong agent advisors. 2. To have a rich and active social circle: it helps to get higher case rate and case size. Also the chances of policy lapsing can be less and renewals can be more. 3. Greed for money: Firm selects advisors who understand the language of commission. Because people who want fix amount as their earnings are not suitable for this business. 4. Independent: MNYL select people who want to be entrepreneur. Housewives or brokers who want flexible hours for work are prospective person for this business. 5. Persuasion: He should be persuasive in nature because the AA needs to follow up on regular basis with prospective and new clients without being a nuisance value. 6. Excellent interpersonal skills: Because developing and maintaining good relations can get policies. Secondly since most of the insurance companies provide a plethora of similar products, sales depend on the convincing ability of the AA and the rapport the AA is bale to build. Also results in C of I’s. - 41 -
  42. 42. CHANNEL DEVELOPMENT AT MNYL. 7. Excellent communication skills: Since AA needs to communicate about the organization, products, career as AA, about why insurance is important, which product will suit his requirement etc. Desirable Candidates 1) Housewives. 2) Employees having VRS. 3) CA’s. 4) Mutual Fund Brokers. 5) NSC brokers. 6) Tax Consultants. 7) Businessman. 8) Doctors. 9) Travel agents. 10) Lawyers 11) Diamond merchants. 12) Social workers. B.2 DEVELOPMENT STRATEGIES - 42 -
  43. 43. CHANNEL DEVELOPMENT AT MNYL. Management team has developed certain strategies in order to expand channel distribution network. These model are followed across the country uniformly and top management feels that these rules are the building block of MNYL’s success in India as well as across the world. There are 2 basic principles that are required in order to execute these strategies such as 1) Prospecting: Identify the right person who fits in the eligibility model. 2) Selection: Select them for further plan of actions. • RULE OF 31 Rule of 31 is associated with the daily activities which is follow to recruit quality advisors. It says that everyday collect at least 3 names of the prospective AA and do 1 screening every day. • Ways of Name Gathering There are several ways for gathering names in order to follow rule of 31. - 43 -
  44. 44. CHANNEL DEVELOPMENT AT MNYL. • Natural Market: A natural market consist of people to whom you know well from your family, friend circle, relative can be a good prospect. The most admired way for recruitment in MNYL is through natural market. Natural market persons are easily approachable and most of the successful recruitment in MNYL is from natural market. • Personal Observation: It means identify the right person through observation. For e.g. a person residing in your locality and very famous in taking initiative in social activities can be a good prospect. • Nominator Call: A nominator is a person who is very much influential in the market as well as in societies. Name gathering and identification is easy in this case, but these people are highly unapproachable. These people can be very productive in giving references of the prospect. They are not prospect by default. • Centre of Influence (CoI) Call: A centre of influence person is people who are influential and you know them personally. They are approached for giving references of the client. • Prospect Call: - 44 -
  45. 45. CHANNEL DEVELOPMENT AT MNYL. Prospects itself are approached. They can be anyone from natural market, Nominator’s reference, CoI‘s reference or by other means. • Activities: Doing activities such as brand awareness in Public places such as mall, multiplexes can be a good strategy for name gathering. We can have a questionnaire format to fill by applicant for the lucky draw. • Phoenix mill. • Nakshatra mall. • Hirra panna. • Siddhivinayak temple. • Nirmal life style. • BSE. - 45 -
  46. 46. CHANNEL DEVELOPMENT AT MNYL. COLD/ WARM/ HOT This is another method that helps the management trainee and the sales managers keep a track of the names he has from his natural market as well as through name gathering,  Cold - 46 - COLD WARM HOT
  47. 47. CHANNEL DEVELOPMENT AT MNYL. Cold is like what u are having. In this column we include all the names which we have as a prospect. It includes C o I names, references, nominators, PO names and so on. It is a list of all the names that we wish to contact in future.  Warm Once the names mentioned in the cold column are contacted and if any appointments scheduled at the office wherein initial screening is then conducted the candidate is then entered in the warm list.  Hot After being entered in the warm list if any candidate has attended any of the seminars held at Max New York Life after the initial screening done and if the candidate has been given P200 (project 200) then the prospective agent is then said to be entered in the hot list. COLD. WARM. HOT. 80 30 8 - 47 -
  48. 48. CHANNEL DEVELOPMENT AT MNYL. QUESTIONNAIRE Hello. This is MRUNAL D. SAMANT from Max New York Life, working here as a management trainee. I would appreciate it if you could lend me just 2 minutes of your time for my project on Insurance Industry. I would like to assess if you are interested in taking a business opportunity available in the insurance sector which requires no investment of yours. 1. Where do you invest your Money? a. Stock Markets b. Mutual Funds c. Life Insurance d. Property - 48 - PROPERTY. 55 % MUTUAL FUND. 25 % INSURANCE 15 % SHARES 5 % INVEST - MENT OPTIONS.
  49. 49. CHANNEL DEVELOPMENT AT MNYL. 2. Name any 3 Insurance Companies you are aware of? a. _____________________________________ b. _____________________________________ c. _____________________________________ TATA AIG BIRLA SUN LIFE ICICI PRUDENTIAL 3. In a year how much money do you invest? (approx) - 49 -
  50. 50. CHANNEL DEVELOPMENT AT MNYL. _________________________________________ 4. Are you aware of any Insurance products? a. ____________________________________ b. ____________________________________ c. ____________________________________ 5. Which among the following products do you own? a. Whole Life/ Endowment b. Money Back c. Unit Linked Insurance Plan d. Term Plan e. Education/ Child Plan 6. What is the reason of having the above cover? a. Security - 50 -
  51. 51. CHANNEL DEVELOPMENT AT MNYL. b. Investment c. Tax Benefits TAX BENEFIT SECURITY INVESTMENT 7. Are you aware of the earning potential in insurance sector? a. Rs.20,000 to 30,000 b. Rs.30,000 to 50,000 c. Rs.50,000 to 75,000 d. Rs.75000 to 1,00,000 8. Would you like to add a business to your current profile? - 51 -
  52. 52. CHANNEL DEVELOPMENT AT MNYL. a. Yes b. No YES NO 9. Which is the quality according to you that would be required for Being successful in business? a. Communication b. Networking c. Both COMMUNICATI ON NETWORKING BOTH NAME: ______________________________________ ADDRESS: ______________________________________ - 52 -
  53. 53. CHANNEL DEVELOPMENT AT MNYL. ______________________________________ CONTACT NO.: ______________________________________ ANNUAL SALARY: ______________________________________ Thank You for your valuable time and for your information the agency business in insurance sector is successfully pursued by businessman, housewife, freelancers, IT Consultants/CA, professionals like Doctors, Architects, Trader Segments, Auto, Real Estate, etc. B.3 SCRIPTS AND HANDLING OBJECTIONS MNYL has its own scientifically handled script they use worldwide for approaching the future AA for the Company. The company periodically - 53 -
  54. 54. CHANNEL DEVELOPMENT AT MNYL. modifies the versions of the scripts if needed as per requirement. All the mangers are required to follow the scripts. There are several kinds of scripts. The classification of scripts is follows: 1) Nominator Script: Nominator is a person who is not prospect for firm but he gives reference to firm. The main objective of this script is to fix an appointment with the nominator. 2) CoI Script: Centre of influence is a people whom you know. The main objective of this script is to fix an appointment with the CoI or to collect the references from them. 3) Prospect Call Script: With the help of this script, firm tries to motivate people to visit MNYL office. The main objective of this script is to call the prospect in MNYL for the initial screening. 4) In person Nominator Script: This script includes many questions which help to get references quickly. This script is used to entertain Nominators and influence them to collect references from them. 5) CoI in person Nominator Script: This script is used to collect references from CoI’s. All the scripts are also contained with expected objections from the prospects/CoI/nominators. These objections are based on the rich experiences and have adequate strategy to avoid objection. In any Case, an objection is - 54 -
  55. 55. CHANNEL DEVELOPMENT AT MNYL. found to be unlisted it is responsibility of SM to bring back in the spirit of original script provided them. - 55 -
  56. 56. CHANNEL DEVELOPMENT AT MNYL. Section C CHANNEL DEVELOPMENT PROCESS. - 56 -
  57. 57. CHANNEL DEVELOPMENT AT MNYL. Flow Based approach to Channel Development Process - 57 - YES NO NO YES StartStart Name Gathering in P200Name Gathering in P200 Short listingShort listing ContactingContacting Interested?Interested? EndEnd Initial ScreeningInitial Screening NATNAT Career Seminar & P200Career Seminar & P200 Interested?Interested? EndEnd Career interviewCareer interview FCSFCS Contract with MNYLContract with MNYL IC-33 ?IC-33 ? ReappearReappear NOT CLEARED CLEARED EndEnd
  58. 58. CHANNEL DEVELOPMENT AT MNYL. C.1 NAME GATHERING IN P200 Name gathering in P200 consists of people whom you know from natural market and references you get from their sources. As a management trainee were given a task to gather 200 names. Figure shows the P200 format in which the database is created. • Name of the prospective Agent • Address of Contact • Age • Marital Status • Qualification • No. of years in the City • Financial Status • Profession • Annual Income • Natural Market • Comments C.2 SHORT LISTING Candidates are shortlisted from the P200 as per the eligibility criteria laid down by the company. Only eligible candidates are considered for the next process. C.3 CONTACTING - 58 -
  59. 59. CHANNEL DEVELOPMENT AT MNYL. Candidates are called either as nominator, CoI, Prospective Agents and a meeting is fixed with them according to the convenience of both the party. Here script plays very important role in fixing appointment with the prospect. C.4 INITIAL SCREENING Initial screening is taken if candidate is found eligible using 4 point model. In intial screening, a sales manager first gives the introduction about the company. Then several questions such as his family background, his natural market, traits for a sales person, and his present and past experiences of his jobs are questioned. Every candidate is required to get at least 3 points in eligibility model the company. The eligibility standards for AA selection are as follows. In case of score less than 3, special zonal head approval is required. FIVE POINT SYSTEM: Age 25 and over 1 point Graduate 1 point Married 1 point Lived in city more than 5 years 1 point NAT score 1 point (if passed) C.5 NAT Numerical Ability test is taken. Passing Score is 50%. C.6 CAREER SEMINAR AND P200 - 59 -
  60. 60. CHANNEL DEVELOPMENT AT MNYL. All the prospects are required to attend career seminar at MNYL which provides broader aspects of growth as an Agent Advisor. P200 is a worksheet which is given to each prospect to judge his natural market. The prospects are required to mention at least 100 contacts from their natural market. C.7 CAREER INTERVIEW P200 is evaluated in Career Interview. If candidate’s market is found worth, he is selected to attend training and Development programme. C.8 FCS All the selected candidates are required to attend 22 day training session for receiving the license from IRDA to become an Agent Advisor. C.9 CONTRACT All the successful candidates having legal license of IRDA are contracted with MNYL. In this firm has its own statistic. That means if we will contact 60 person in a month. Then we can convert 2 people for a batch as a AA. - 60 -
  61. 61. CHANNEL DEVELOPMENT AT MNYL. 60 Cold prospects. 20 Initial screening. 16 Test. 08 Seminar. 04 Career Interview. 02 FCS Batch. - 61 -
  62. 62. CHANNEL DEVELOPMENT AT MNYL. Section D STATUS REPORT. - 62 -
  63. 63. CHANNEL DEVELOPMENT AT MNYL. D.1 ACTIVITY CHART Particulars Status 1) Initial Screening 30 2) NAT 6 3) Career Seminar 8 4) P200 8 5) Career Interview 5 6) FCS - 7) Total Recruitment - 8) Contracted - The above activity chart represents the work done by me in accordance with the channel development process. The P200 sheet will be attached with this project where name and contact numbers are stored in format prescribed by the MNYL. - 63 -
  64. 64. CHANNEL DEVELOPMENT AT MNYL. SECTION E CONCLUSION - 64 -
  65. 65. CHANNEL DEVELOPMENT AT MNYL. E.1EXPERIENCE My Experience with MNYL will always be grateful for me. I learned many things in MNYL. The very first thing I learned in MNYL is to handle objections from the customers. Different type of scripts of MNYL helps in this. Working on deadline for achieving target is most crucial process in this sector and I am thankful to my sales Manager who were always behind me to support during initial call and helps me to complete my training. The GO meet to reward successful AA and SM for the month is another example which clearly emphasizes that MNYL has strong belief in maintaining a healthy relationship with their stakeholders. Overall “Channel Development” was a fair attempt from me. During the project I was able to make 200 names. My telephonic conversation with the prospect always gave me a positive direction to build my confidence and even in bad phase of response I learnt the art of making calmness. I shared a lot of activities with my colleagues. All the trainees from different background also remained a source of energy for my daily activities. E.2 SUMMARY - 65 -
  66. 66. CHANNEL DEVELOPMENT AT MNYL. Life insurance business in terms of first year premium has shown a growth of more than 95% over the previous year and non life, or general insurance, is not far behind either, growing at 22% during 2006-07. In this market, competitive edge provided by product innovation can sustain only for a couple of months, since products can easily be cloned. Hence “Channel development” is the only process through which an insurer can have SCA over other competitor. Strategic approach for calling Nominators/CoI/prospect has several advantages through which company maintains integration of system. E.3 RECOMMENDATION - 66 -
  67. 67. CHANNEL DEVELOPMENT AT MNYL. Max New York Life as an insurance firm has a very strong presence in India and is rapidly expanding its operations in India. After working on this project I feel that following are some of the ways in which the company can improve the current market base and selection procedure for AAs, the key revenue generating resource for the company: • Increase awareness among the general public HEARD KNOWN EXPERIENCED UNKNOWN. • In survey I come to know only 5 % people are heard about this company. • Only 10 % people known about this company. It shows less brand image of company. • 25% people experienced this company by taking policy. • But 60 % people are unaware about this company. It is because of lack of advertisement. • Highlight the core strengths of the company like oldest firm in insurance sector, highest paid up capital, etc. - 67 -
  68. 68. CHANNEL DEVELOPMENT AT MNYL. • Very less people know about highlights of the company. • Firm is not well known though it is oldest firm. • No one knows positive points of the company, like registered under companies act, six sigma and so on. • Have a re-look at the existing product range and design products which can attract masses rather than just serving only classes. E.4 BIBLIOGRAPHY. - 68 -
  69. 69. CHANNEL DEVELOPMENT AT MNYL. • IC 33 book of Max New York Life. • www.maxnewyorklife.com • www.google.com - 69 -
  70. 70. CHANNEL DEVELOPMENT AT MNYL. - 70 -

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