ORGANISATION STUDY AT

IDBI FEDERAL LIFE INSURANCE CO LTD

Submitted to :
MAHATMA GANDHI UNIVERSITY, Kotayam,
In partial fulfilment of the requirement for the award of:
MASTERS DEGREE IN BUSINESS
ADMINISTRATION
(2012-2104)
By:
Eby Jose
Reg No: 40080



RAJAGIRI SCHOOL OF SOCIAL SCIENCES.
RAJAGIRI PO
KOCHI-683104




ACKNOWLEDGEMENT
I express my profound gratitude towards all who have helped me
complete this Organisational study, for their wholehearted support and
guidance.
I would like to extend my deepest gratitude towards the management
and faculty at Rajagiri School of social sciences for their support in
making this report. I extend also extend sincere gratitude to my faculty
guide Prof. Febin Jose Sunny, for his continuous encouragement and
support, without whose guidance I would not have been able to
complete this report.
I would also like to express my deepest gratitude towards IDBI Federal;
especially my company guide Mr Johny Joseph, for the permission
granted to conduct an organisational study and for the support and
guidance given to me for the completion of the report.
I would like to thank, my parents and friends for their continuous
support and above all God almighty for granting me good health for the
completion of this report.




DECLARATION

I, Eby Jose, Student of Rajagiri College of Social Sciences, Kochi, hereby
declare that this report titled Organisational study at IDBI FEDERAL LIFE
INSURANCE Co. is a bonafide record of the organization study done by me
at IDBI FEDERAL LIFE INSURANCE CO LTD, Kochi and submitted to
Mahatma Gandhi University, Kotayam in the partial fulfilment of the award of
Masters in Business Administration.
I further declare that this project has not been submitted to any other
university/board for the award of any degree/diploma.

Place : Cochin Eby Jose
Date : 26-07-2013 Rajagiri College of Social Sciences





Table of contents:

Sl No Chapter Page numbers
1 Certificates 2-3

2 Acknowledgement 4

3 Declaration 5

4 Table of contents 6

5 Industry analysis 7-23

6 Company profile 24-30

7 Company hierarchy 31-36

8 Business process 37-44

9 Management techniques 45-49

10 Product mix 50-57

11 Analysis of the company 58-63

12 Kochi Branch 64-68

13 Routine work 69-72









Chapter 1- Industry analysis:












Introduction:
Life is full of uncertainties, people opt for insurance for these uncertainties in life. Insurance
gives the insured a kind of peace of mind of making up for the financial losses in the event of
such uncertainties happening in life
Insurance can be defined as a contract (policy) in which an individual or entity receives
financial protection or reimbursement against losses from an insurance company. The
company pools clients' risks to make payments more affordable for the insured.
More broadly put, insurance companies collects liabilities (i.e. premiums) from everyone that
it insures and then pays them out to the entities faced with some sort of event-driven crisis,
where they will ostensibly need more cash than they currently have on hand. As not everyone
within the pool will actually suffer an event, lowers the total cost of risk management for
everyone in the pool.
In short, insurance is a risk sharing tool, which involves redistribution of costs of unexpected
losses. Insurers get exposed to similar kind of risks and come together to share the losses of
those who actually incurred such losses. It is a hedging tool against risks.
An insurer, or insurance carrier, is a company selling the insurance; the insured, or
policyholder, is the person or entity buying the insurance policy. The amount of money to be
charged for a certain amount of insurance coverage is called the premium. Risk management,
the practice of appraising and controlling risk, has evolved as a discrete field of study and
practice. The insured receives a contract, called the insurance policy, which details the
conditions and circumstances under which the insured will be financially compensated.
Insurance companies theoretically make money by charging enough premiums to cover the
expected pay-outs that they will have to cover over the life of the policy and by earning
investment returns ("the float") using the collected premiums. In actual practice, most
insurance companies pay out almost all of their premiums in order to attract larger customer
volumes and liabilities. Chief earnings focus is thus placed on investment returns



Classifications of insurance:
There are a large number of types of insurance all have the basic function of acting as a
protection against risks in life .Insurance in India can be classified into the following three
basic types
1 Life insurance
2 General insurance.
3 Reinsurance:

1 Life insurance:
Life Insurance is a contract providing for payment of a sum of money to the person assured
or, following him to the person entitled to receive the same, on the happening of a certain
event. Life insurance products provide protection against risks of loss of life and provides
compensation to the family , in case of death of a person.
Life insurance products are of many types, there are many new types of life insurance plans.
Life insurance plans have evolved from a just a protection against death to an investment
option with high returns.
Some of the major types of life insurance are:
TERM LIFE INSURANCE:
Under a Term Life contract, the insurance company pays a specific lump sum to the
designated beneficiary in case of the death of the insured. This is one of the oldest and the
simplest life insurance policies. These policies are usually for 5, 10, 15, 20 or 30 years. The
premium on such type of policies is comparatively quite low when compared with other types
of life insurance policies, mainly due to the fact that these policies do not carry cash value.
These products only provide a protection and does not work as an investment tool.



PERMANENT LIFE INSURANCE :
In a Permanent Life contract, a portion of the money paid as premiums is invested in a fund
that earns interest on a tax-deferred basis. Thus, over a period of time, this policy will
accumulate certain "cash value" which you will be able to get back either during the period of
the policy or at the end of the policy.
These type of policies have the dual advantage of providing compensation in case of death
and also act as an investment or tool. These provide returns to the money invested. These
type of policies are now more accepted in the market and there are many types of this policy
existing in the market. Some of the type of permanent life insurance is:
ENDOWMENT POLICIES
These policies provide for period payment of premiums and a lump sum amount either in the
event of death of the insured or on the date of expiry of the policy, whichever occurs earlier.
MONEY BACK POLICIES
These policies provide for periodic payments of partial survival benefits during the term of
the policy itself. A unique feature associated with this type of policies is that in the event of
death of the insured during the policy term, the designated beneficiary will get the full sum
assured without deducting any of the survival benefit amounts, which have already been paid
as money-back components. Money back plans are of further different types
ANNUITY /POLICIES / FUNDS
This policies / funds require the insured to pay the premium as a single lump sum or through
instalments paid over a certain number of years. The insured in return will receive back a
specific sum periodically from a specified date onwards either for life or for a fixed number
of years. In case of the death of the insured, or after the fixed annuity period expires for
annuity payments, the invested annuity fund is refunded, usually with some additional
amounts as per the terms of the policy. A recent development in these type of plans is ULIP
ULIPs
They are market-linked life insurance products that provide a combination of life cover and
wealth creation options. A part of the amount that people invest in a ULIP goes toward
providing life cover, while the rest is invested in the equity and debt instruments for
maximising returns.
There are many different life insurance products existing which are a combination of these
major types. Nowadays, insurance companies have started introducing a variety of products
which have the benefits of more than one particular type.

2 General Insurance
General insurance means insurance against health, marine, fire and other insurance like
insurance against theft, accidents. employers liability, vehicle etc. also termed as non-life
insurance. In general insurance it is not the life of a person that is insured. General insurance
also includes insurance for shops, vehicles ,etc.
These are the oldest type of insurance. .There are a many different types of general insurance
targeting various customers and for different purposes. These include health insurance,
vehicle insurance, home insurance, shop insurance and a wide variety of insurances other
than life insurance. Some of the types are:
VOYAGE INSURANCE:
Voyage insurance provides protection against damage and loss of goods, while in transport.
This helps in the protection against any damages happening when goods are transported, be it
by rail, road , ship, flight. This includes both national and international transportations.

PROPERTY INSURANCE:
Property insurance provides protection against risks to property, such
as fire, theft or weather damage. This may include specialized forms of insurance such as fire
insurance, flood insurance, earthquake insurance, home insurance
VEHICAL INSURANCE:
Auto insurance protects the policyholder against financial loss in the event of an incident
involving a vehicle they own, such as in a traffic collision. There are many types of motor
insurances which cover the losses due to damage of vehicle, damage of property, treatment
charges etc.
CREDIT INSURANCE:
Payment protection insurance (PPI), also known as credit insurance, credit protection
insurance, or loan repayment insurance, is an insurance product that enables consumers to
insure repayment of loans if the borrower dies, becomes ill or disabled, loses a job, or faces
other circumstances that may prevent them from earning income to service the debt. This is
always linked to loan
FIRE INSURANCE
The oldest kind of modern insurance is for fire. Fire includes explosion, storm, and natural
forces other than storm, nuclear energy and land subsidence. It is worth mentioning that an
insurance policy described as fire insurance usually includes many other risks that threaten
other goods. Also, it is notable that legislation regulates, in particular, the fire insurance
contract and the same regulations are applied by analogy also for coverage of goods against
risks other than fire.
ACCIDENT / HEALTH INSURANCE
The definition of personal accidents also includes injuries and illness occurring during and
occasioned by the execution of an employment contract. The special risks that can be covered
totally or partially by this class of insurance are the following: fixed pecuniary benefits,
benefits in the nature of indemnity, combinations of the two and, finally, injury to passengers.
There are many forms of general insurance plans that are being developed by companies the
above list forms of general insurance are the most commonly found types.
3 Reinsurance
Reinsurance is insurance that is purchased by an insurance company from one or more other
insurance companies as a means of risk management. The practice of insurance companies,
transferring a portion of risk portfolios to other parties by some form of agreement in order to
reduce the likelihood of having to pay a large obligation resulting from an insurance claim.
The intent of reinsurance is for an insurance company to reduce the risks associated with
underwritten policies by spreading risks across alternative institutions.
Key insurance terms:
CLAIM:
A demand made by the insured, or the insured's beneficiary, for payment of the benefits as
provided by the policy.
POLICY:
The written contract effecting insurance, or the certificate thereof, by whatever name called,
and including all clause, riders, endorsements, and papers attached thereto and made a part
thereof.
PREMIUM:
The price of insurance protection for a specified risk for a specified period of time.
RISK:
A situation where the probability of a variable (such as burning down of a building) is known
but when a mode of occurrence or the actual value of the occurrence (whether the fire will
occur at a particular property) is not
AGENT
Insurance is sold by two types of agents: independent agents, who are self-employed,
represent several insurance companies and are paid on commission; and exclusive or captive
agents, who represent only one insurance company and are either salaried or work on
commission.
ANNUITY
A life insurance product that pays periodic income benefits for a specific period of time or
over the course of the annuitants lifetime.
UNDERWRITING:
The process of selecting risks for insurance and classifying them according to their degrees of
insurability so that the appropriate rates may be assigned. The process also includes rejection
of those risks that do not qualify.
TERM OF POLICY:
Period for which the policy runs. In life insurance, this is to the end of the term period for
term insurance.
ACTUARY:
An insurance professional skilled in the analysis, evaluation and management of statistical
information. Evaluates insurance firms reserves, determines rates and rating methods, and
determines other business and financial risks.
DIVIDEND:
The return of part of the policy's premium for a policy issued on a participating basis by
either a mutual or stock insurer. A portion of the surplus paid to the stockholders of a
corporation
FREE LOOK:
A period where a new insurance policy owner is able to terminate the contract without
penalties such as surrender charges.
WAVIER OF PREMIUM
A provision in some insurance contracts which enables an insurance company to waive the
collection of premiums while keeping the policy in force if the policyholder becomes unable
to work because of an accident or injury.
INDEMITY:
Restoration to the victim of a loss by payment, repair or replacement.
SURENDE VANLUE:
Value of the policy when it is surrendered. This means, the insurance being discontinued
before the expiry of the policy term of the insurance. The surrender value is usually very low
for policies .


SURENDER CHARGE
Fee charged to a policyholder when a life insurance policy or annuity is surrendered for its
cash value. This fee reflects expenses the insurance company incurs by placing the policy on
its books, and subsequent administrative expenses.


History of global insurance:
The first methods of transferring or distributing risk were practiced by Chinese and
Babylonian traders as long ago as the 3rd and 2nd millennia BC, respectively. Chinese
merchants travelling treacherous river rapids would redistribute their wares across many
vessels to limit the loss due to any single vessel's capsizing. The concept of risk sharing was
limited to the sea voyages until ,The Greeks and Romans introduced the origins of health and
life insurance c. 600 BCE when they created guilds called "benevolent societies" which cared
for the families of deceased members, as well as paying funeral expenses of
members. Guilds in the Middle Ages served a similar purpose.
Separate insurance contracts (i.e., insurance policies not bundled with loans or other kinds of
contracts) were invented in Genoa in the 14th century, as were insurance pools backed by
pledges of landed estates. The first known insurance contract dates from Genoa in 1347, and
in the next century maritime insurance developed widely and premiums were intuitively
varied with risks .Insurance became far more sophisticated in post-Renaissance Europe, and
specialized varieties developed
Toward the end of the 17th century, London's growing importance as a centre for trade
increased demand for marine insurance. In the late 1680s, Mr Edward Lloyd opened a coffee
house that became a popular haunt of ship owners, merchants, and ships captains, and
thereby a reliable source of the latest shipping news. It became the meeting place for parties
wishing to insure cargoes and ships, and those willing to underwrite such ventures. Today,
Lloyd's of London remains the leading market (note that it is not an insurance company) for
marine and other specialist types of insurance,
Insurance as we know it today can be traced to the Great Fire of London, which in 1666
devoured 13,200 houses. In the aftermath of this disaster, Nicholas Barbon opened an office
to insure buildings. In 1680, he established England's first fire insurance company, " In the
late 19th century, "accident insurance" began to be available, which operated much like
modern disability insurance
Policies offering insurance on lives were available from the late 16th century. The earliest
recorded example in the UK dates from 1588. Life assurance as a corporate business did not
really develop until 1699 with the establishment in England of the Society of Assurance for
Widows and Orphans, followed a year later by the Second Society of Assurance for Widows
and Orphans, followed in 1706 by the Amicable Society .In the mid-19th century, the
percentage of those with life assurance was still relatively small the majority came from the
landed, professional and commercial classes. The first UK group life assurance scheme was
established by the Provident Clerks Mutual Benefit Association in 1846. This served to open
up the market, allowing companies to pay the premiums for providing life assurance to their
employees as a benefit of employment. In 1852, industrial policies were introduced by the
Family Friendly Society that provided life cover in exchange for small weekly payments and
made life insurance accessible to all.












Global insurance sector:
The insurance industry is one of the largest financial sectors in the world. The global
insurance sector today is worth approximately 4000 billion dollars, today with life insurance
sector accounting for 57% of the total insurance industry. Today the insurance sector is
present in almost 140 countries in the world and insurance sector is one of the major
employers on the world.
In most countries, life and non-life insurers are subject to different regulatory regimes and
different tax and accounting rules. The global insurance one of the highest growth rate when
compared to other sectors. The annual growth rate for insurance in close to 15% for the next
5 years.
2012 saw many global insurance companies being badly affected by the economic problems
in the US and Europe, the general growth of the sector was much lower when compared to
the previous years. The primary insurers and reinsurers achieved sizeable performance
improvements after the sharp downturn in 2008, and at the end of 2011 they appear to be
better capitalised than at the beginning
In general the insurance sector as of now shows a good position and is very strong in spite of
the hiccups and problems faced due to the economic slowdown
Some of the major insurance companies in the world are :
1 American International Group (AIG), United States, Market Value: $172.24 billion
2 AXA Group ,France , Market Value: $66.12 billion
3Allianz Worldwide, Germany, Market Value: $65.55 billion
4 Manulife Financial, Canada, Market Value: $50.52 billion
5Prudential Financial ,United States ,Market Value: $39.70 billion
6MetLife. United States, Market Value: $37.94 billion
7Aviva, United Kingdom, Market value: $33.10 billion
8Munich Re Group, Germany, Market Value: $30.99 billion
9 AEGON, Netherlands, Market Value: $26.40 billion
Insurance sector in India
Insurance in India is a subject listed in Union list in the 7
th
schedule of the constitution which
only the central government can legislate. Insurance in India is currently open market. There
are 52 players in the industry as of today, out of these 24 are in the life insurance and 27 in
the general insurance sector and the sole reinsurer being GIC or the general insurance
corporation.
Current scenario of insurance in India:
The insurance industry is today a sunrise industry in India and after the deregulation of the
industry in 1999 the industry has shown tremendous growth in the last decade. The industry
grew at an average rate of 25 per centile in the last decade(2000-2010) . The insurance sector
today contributes 4.1% of the total GDP of the country as of 2012. India today has the 9
th

largest number of insurance policies in the world. In 2012 there was a total of Rs`2, 87,072
crore paid as premium for life insurance and general insurance premiums amounted to
`52,876 crores. There are about 270 million insurance policies in India. This sector is
expected to grow at around 15% in the future 5 years, which is approximately 3 time that of
the GDP growth
Out of the life and general insurance life insurance contributes 88% of the total revenue.
Though the sector showed a growth of 25% in the last decade, during 2011-2012 the life
insurance sector showed a decline of about 4% whereas the general insurance sector grew at
close to 25%. India has the largest number of insurance policies. The insurance sector grew at
25% in the last decade and contributed 670 billion dollars in 2010. The life insurance sector
forms 88% of the total insurance sector in India. The life insurance sector in India is said to
be the 9
th
largest in the world. This sector has a very large growth potential.
The insurance sector in India is a regulated industry, the government controls and monitors
the functioning of the sector through the IRDA or the insurance Regulatory and development
Authority. The IRDA ensures that the insurance companies function properly and ensures
that consumer interest are protected. The IRDA was established in the year 1999 by the
passing of an act in the parliament. IRDA has evolved into an effective regulator and it has
facilitated the entry and growth of private players in the insurance sector.
The government owned LIC is still the largest player in the life insurance sector. There are
also 4 government owned general life insurance companies which contribute a major part of
the revenue from the sector There are more than 50 private sector companies in the industry
Brief history of insurance in India
Insurance in India has a deep rooted history, in the ancient manuscripts by Manusmriti and
Yagnavalikya there are references to a form of insurance, where money is pooled to be
distributed in times of calamities, there are also reference made to insurance in the form of
marine trade loans etc.
The insurance in the current form dates back to 1818 when the Oriental Life Insurance
Company was started in Kolkata, this mainly focused on the Europeans. At the dawn of the
twentieth century, a large number of insurance companies mushroomed, these companies
After the independence, in 1956 the life insurance sector was nationalised, absorbing the 250
odd life insurance companies and the LIC or the Life insurance corporation was formed, this
still remains the largest life insurance company in India. The general insurance was also
nationalised in 1972, and companies were grouped into four companies, which were grouped
as the GIC or the general insurance corporation of India. This was the scenario till 1999
where the sector was a monopoly of the government.
In 1999 the government introduced the IRDA and privatised the insurance sector allowing
private companies to come into the insurance sector. The insurance sector was de regularised.
The government also allowed FDI in insurance u unto 26%. This period saw the sector being
opened and many private companies started offering insurance services. Again in 2012, the
insurance sector was further de controlled by raising the limit in FDI to 49%.
Life insurance market in India:
As the company in focus, IDBI Federal is a life insurance company further discussions are
limited only to the life insurance market in India.
The life insurance sector is always guided and controlled by the IRDA or the insurance
regulatory and development Authority. The sector can be described as a monopolistic
market. There are comparatively less entry restrictions and the market is quiet open. Most of
the companies offer similar products, with almost similar benefits. The difference lies in the
advertising and the marketing techniques.
Now most of the companies have diversified from the traditional insurance schemes and most
offer plans that offer insurance along with returns for investment. There are a number of
plans designed to suit the needs of various clients.
There is a huge potential for life insurance companies in India as the penetration of life
insurance is very low in Indian. Though India is the 9
th
largest life insurance market in the
world, the insurance premiums account only for 5.21% of the total GDP which is very less
when compared to the international average of 10%. This shows that there is very strong
potential for life insurance companies. It is said that the insurance sector is set to grow at 18%
which is 3 times that of the GDP growth.
The demand for life insurance is also rising. India being the second most populous country
shows the potential demand. Also the rising financial knowledge and the rising population of
middle classes along with the growth in per capita incomes have increased the potential for
high demand. Also the large numbers if youth and the high salaries among them is also a
potential source if high demand.
On the supply side there are enough number of players and more players are expected to
come. There is enough amounts of insurances available and companies are competing with
each other and innovating in products and advertisement and promotional techniques.

Marketing insurance:
Insurance is still a sellers good. This means, insurance policies are sold mostly by going to
the customer and convincing him to buy it. Here it is the seller who goes to the customer,
unlike a buyers good where the customer comes and buys the product (example consumer
goods). Hence marketing and advertisement play a major role in promoting business among
insurance companies.
Insurance is marketed by direct marketing. Most insurance companies have agents or
advisors who go and meet prospective clients and get business for them. Agents are a major
part of any insurance company. More than 60% of business of companies are done through
agents. This is in addition to the regular advertisements and other marketing techniques.
The insurance companies also rope in corporate agents. These corporate agents are
companies that have a huge customer base to which it can target these insurance products.
Since liberalization, the most buzzing form of distribution is bancassurance. Bancassurance
refers to the selling of insurance policies through a banks established distribution network.

Life insurance players in India:
There are 24 life insurance companies in India as on 2013 April. Which includes LIC, which
is the state owned insurance company and also companies which are partial or full
subsidiaries of banks both public sector as well as private like SBI Life . There are many
companies with a foreign investment and joint ventures like ICICI prudential.
Of the 24 life insurance companies, the government owned LIC still leads in market share,
with a share of about 70% of business. Among the private companies the largest is ICICI
Prudential. Other major private players include, Bajaj Alliance ,Relience life etc.
Table showing list of life insurance companies with market share (2011-2012):
Name of company Premium underwritten (crores) Market
share
EDELWEISS TOKIO
10.88 0.004
DLF PRAMERICA
167.01 0.058
SAHARA
225.95 0.079
AEGON RELIGARE
457.32 0.159
SHRIRAM LIFE
644.16 0.224
IDBI FEDERAL
736.7 0.257
BHARTI AXA
774.16 0.27
FUTURE GENERALI
779.58 0.272
STAR UNION DAI-ICHI
1271.95 0.443
INDIAFIRST
1297.93 0.452
ING VYSYA
1679.98 0.585
CANARA HSBC
1861.08 0.648
AVIVA
2415.87 0.842
METLIFE
2677.5 0.933
KOTAK MAHINDRA
2937.43 1.023
TATA AIA
3630.3 1.265
RELIANCE
5497.62 1.915
BIRLA SUNLIFE
5885.36 2.05
MAX LIFE
6390.53 2.226
BAJAJ ALLIANZ
7483.8 2.607
HDFC STANDARD
10202.4 3.554
SBI LIFE
13133.74 4.575
ICICI PRUDENTIAL
14021.58 4.884
LIC
202889.28 70.675
TOTAL
287072.1 100

Source: IRDA Annual report 2011-2012
It can be seen that only about 10 of the 24 companies make any significant contribution of
more than 1% to the total business. The rest 20 companies have less than 1% contribution.
This can be represented as the following pie chart:

17%
16%
12%
9%
8%
7%
7%
4%
3%
3%
3%
2%
2%
2%
2%
1%
1% 1% 1% 1% 0% 0% 0%
Premium underwritten (crores)
ICICI PRUDENTIAL
SBI LIFE
HDFC STANDARD
BAJAJ ALLIANZ
MAX LIFE
BIRLA SUNLIFE
RELIANCE
TATA AIA
KOTAK MAHINDRA
METLIFE
AVIVA
CANARA HSBC
ING VYSYA
INDIAFIRST
STAR UNION DAI-ICHI
FUTURE GENERALI
BHARTI AXA
Life insurance last year.
Though the insurance sector has seen a huge growth rate over the last 12 years, during the
last year (2012) the insurance sector especially the life insurance sector saw a fall in the
growth. The growth slowed for both public as well as private sector players.
Life insurance industry recorded a premium income of `2,87,072crore during 2011-12 as
against `2,91,639 crore in the previous financial year, registering a negative growth of 1.57
per cent. While private sector insurers posted 4.52 per cent decline (11.08 per cent growth in
previous year) in their premium income, LIC recorded 0.29 per cent decline (9.35 per cent
growth in previous year). On the basis of total premium income, the market share of LIC
increased marginally from 69.77 per cent in 2010-11 to 70.68 per cent in 2011-12.
Chart showing the total premium collected by life insurers:

During the financial year 2011-12, the life insurance industry reported net profit t of `5,974
crore as against `2,657 crore in 2010-11. Out of the twenty four life insurers in operations
during 2011-12, fourteen companies reported profits. They are LIC, ICICI Prudential, Birla
Sunlife, HDFC Standard, Max Life, Reliance, Bajaj Allianz, SBI Life, Kotak Mahindra, Tata-
AIA, MetLife, Aviva, Sahara India and Shriram. Life Insurance Corporation of India has
reported net profit of `1,313 crore i.e., an increase of 12.08 per cent over `1,172 crore in
2010-11.







Chapter -2: Company profile











Company Profile:
IDBI Federal Life Insurance Co Ltd (formerly IDBI Fortis )a joint-venture of IDBI Bank,
Indias premier development and commercial bank, Federal Bank, one of Indias leading
private sector banks and Ageas, a multinational insurance giant based out of Europe. In this
venture, IDBI Bank owns 48% equity while Federal Bank and Ageas own 26% equity each.


Company now:
Having started in March 2008, in just five months of inception, IDBI Federal became one of
the fastest growing new insurance companies to garner Rs 100 Cr in premiums. Through a
continuous process of innovation in product and service delivery IDBI Federal aims to
deliver world-class wealth management, protection and retirement solutions that provide
value and convenience to the Indian customer.
The company offers its services through a vast nationwide network of 2067 partner bank
branches of IDBI Bank and Federal Bank in addition to a sizeable network of advisors and
partners. As on 31st January 2013, the company has issued over 7.70 lakh policies with a sum
assured of over Rs. 25,961 Cr.


Ownership
Ageas
IDBI bank
Federal bannk
IDBI Federal today is recognized as a customer-centric brand, with an array of awards to
their credit. They have been awarded the PMAA Awards (2009) for best Dealer/Sales force
Activity, EFFIE Award (2011) for effective advertising, and conferred with the status of
Master Brand 2012-13 by the CMO Council USA and CMO Asia.
IDBI Federal has its headquarters in Mumbai. It has 62 branch offices. It has over 1500 on
roll employees and also a agent strength of 7000. The company has a business of over 25000
crore. It has more than 50 direct branches in India and tie-ups with IDBI and Federal Banks
for selling and service of product. RM Malla is the, Chairman .G V NageswaraRao, MD &
CEO.

About the sponsors of IDBI Federal Life Insurance Co Ltd
IDBI Bank Ltd. continues to be, since its inception, Indias premier industrial development
bank. It came into being as on July 01, 1964 (under the Companies Act, 1956) to support
Indias industrial backbone.
Today, it is amongst Indias foremost commercial banks, with a wide range of innovative
products and services, serving retail and corporate customers in all corners of the country
from 1036 branches and 1635 ATMs. The Bank offers its customers an extensive range of
diversified services including project financing, term lending, working capital facilities, lease
finance, venture capital, loan syndication, corporate advisory services and legal and technical
advisory services to its corporate clients as well as mortgages and personal loans to its retail
clients
. As part of its development activities, IDBI Bank has been instrumental in sponsoring the
development of key institutions involved in Indias financial sector National Stock
Exchange of India Limited (NSE) and National Securities Depository Ltd, SHCIL (Stock
Holding Corporation of India Ltd), CARE (Credit Analysis and Research Ltd).
Federal Bank Federal Bank is one of Indias leading private sector banks, with a dominant
presence in the state of Kerala. It has a strong network of over 1031 branches and 1153
ATMs spread across India. The bank provides over four million retail customers with a wide
variety of financial products.
Federal Bank is one of the first large Indian banks to have an entirely automated and
interconnected branch network. In addition to interconnected branches and ATMs, the Bank
has a wide range of services like Internet Banking, Mobile Banking, Tele Banking, Any
Where Banking, debit cards, online bill payment and call centre facilities to offer round the
clock banking convenience to its customers. The Bank has been a pioneer in providing
innovative technological solutions to its customers and the Bank has won several awards and
recommendations.

Ageas is an international insurance group with a heritage spanning more than 180 years.
Ranked among the top 20 insurance companies in Europe, Ageas has chosen to concentrate
its business activities in Europe and Asia, which together make up the largest share of the
global insurance market.
These are grouped around four segments: Belgium, United Kingdom, Continental Europe and
Asia and served through a combination of wholly owned subsidiaries and partnerships with
strong financial institutions and key distributors around the world. Ageas operates successful
partnerships in Belgium, UK, Luxembourg, Italy, Portugal, Turkey, China, Malaysia, India
and Thailand and has subsidiaries in France, Hong Kong and UK.
Ageas is the market leader in Belgium for individual life and employee benefits, as well as a
leading non-life player through AG Insurance. In the UK, Ageas has a strong presence as the
fourth largest player in private car insurance and the over 50s market. Ageas employs more
than 13,000 people and has annual inflows of more than EUR 21 billion.







Company history:
The company was incorporated in the year 2006 when IDBI bank, Federal bank and
international insurer Fortis decided to start an life insurance company together the MOU was
signed in 2006 reaching an agreement to this.
The company started its actual operations in March 2008 when it started its first branch in
Mumbai, in the same year the second branch was opened in Vijaywada in Andhra Pradesh.
The company started its operations as the first Wealthsurance company in India. The
initial products offered also included guarantee returns products like Life Positive and
Bondsurance.
In 2009 there was a capital infusion of 250 cr into the company. It is during this time that the
company saw its second phase of expansion. There were many products launched like
retiresurance, incomesuranceetc . During this year the company saw a further growth of 65
branches and saw its employee count rise to more than 1000.
In 2010 the company was renamed IDBI Federal life insurance company.
The company had three phases of expansion with regard to their presence in the number of
branches:
The first phase saw the setting up of Area Agency offices. There were close to one office per
state. There were a total of 16 offices during this stage. During this phase the company had a
tie up with Alliance Group to market its products among the corporates. With respect to
Kerala the first phase saw the setting up of the Kochi office.
During the second phase there saw a further division of the area office into Branch offices.
Each Area office was divided into more branch offices to reach more customers. Here the
Kochi office was further divided into Kochi, Calicut and Trivandrum branches.
The third phase and the final phase of expansion saw the setting up of Assistant Branch
offices. The total number of offices increased to 102 as of now in this stage. This stage also
saw the company expanding to the North- East, beyond West Bengal. The company also
stated a new direct marketing channel, there was a another marketing channel set up for the
marketing if health linked products focused on the rural market

VISION AND VALUES

VISION
To be the leading provider of wealth management, protection and retirement solutions that
meets the needs of our customers and adds value to their lives.

MISSION
To continually strive to enhance customer experience through innovative product offerings,
dedicated relationship management and superior service delivery while striving to interact
with our customers in the most convenient and cost effective manner. To be transparent in the
way we deal with our customers and to act with integrity. To invest in and build quality
human capital in order to achieve our mission.

VALUES

Transparency: Crystal Clear communication to our partners and Stakeholders.
Value to Customers: A product and service offering in which customers perceive value.
Rock Solid and Delivery on Promise: This translates into being financially strong,
operationally robust and having clarity in claims.
Customer-friendly: Advice and support in working with customers and partners.
Profit to Stakeholders: Balance the interests of customers, partners, employees,
shareholders and the community at large.

EXCELLENCE
"In every aspect of work ranging from the in-house training institute to the detailed Personal
Insurance Plan. IDBI Fortis is focused on achieving the highest standards of quality in every
aspect of their business".

HONESTY
"Is the heart of the Life Insurance business? IDBI Fortis believes that above all, Life
Insurance is based on trust. Transparency, Dependability and Integrity will form the
cornerstones of the IDBI Fortis experience."


KNOWLEDGE
"Is what makes experts. IDBI Fortis is focused on the Life Insurance business. Perfectly
combining global expertise with local knowledge, IDBI Fortis is the Indian Life Insurance
specialist."

CARING
"For the customer IDBI Fortis is redefining the Life Insurance paradigm to focus on the needs
of the customers. The IDBI Fortis service process is responsive, personalized, humane and
empathetic."

CULTURE
Our "in house culture recipe" has some of the finest ingredients going into its making. Some
of the more prominent aspects of our culture are stated below:
i. Customer comes first
ii. Do it right the first time
iii. Bias for result oriented action
iv. Financial strength and discipline
v. Clarity of purpose
vi. International quality standards
vii. Inclusive Meritocracy
viii. learning opportunities
ix. Fun at work
x. Commitment to published value system

TECHNOLOGY
To monitor and manage its network equipment across 34 sites, IDBI Fortis uses Tulip
Proactive Managed CE solution. The solution includes device management, proactive
troubleshooting and notification support. With the implementation of the solution, IDBI has
reported improvement of network performance and availability, with a faster, more effective
change and configuration management.






Chapter 3: Company Hierarchy
Management team:
Mr G V NageswaraRao: MD & CEO
FilipCoreman : Chief financial officer.
Maarten Kerbert: Chief operating officer
Ashley Kenedey: National head sales.
Mike Wood: Appointed Actuary
MallikaVyas Head H.R
AneeshSrivastava- Chief investment officer.
AnishTripati- National head marketing & product development
SudhakarShetty- Head legal & complains
Vishakha R M President bancassurance.
Board of directors:
1 MR. R.M. Malla, Chairman
2 Mr. Bart De Smet
3 Mr. P.C. Cyriac (Resigned w.e.f. 12/11/2012)
4 Mr. R. K. Bansal
5 Mr.Filip A. L. Coremans (Appointed w.e.f. 30/09/2011)
6 Mr. Suresh Kumar (Appointed w.e.f. 28/11/2011)
7 Mr. S. Santhanakrishnan
8 Mr. R. K. Thapliyal
9 Mr.DavinderRajpal
10 Mr. G V NageswaraRao, MD& CEO
11 Mr. Gary Lee Crist (Alternate Director to Mr. Bart De Smet)
Organisation hierarchy:


This is the brief hierarchy showing the organisations top management hierarchy. Each of the
head is the top of a particular department.

Sales department:
The sales department is the largest department in the company. It is headed by the national
head of sales.
There are four area heads for the north, south, east and west zone.
Under each zone there is an area agency head, a bancasurance head and a corporate head.
These three are the different sub sections of the sales department.
Under each area agency head are the different levels of distribution managers. The
distribution managers then are manage the agents.
The bancasurace head looks after all the bancasurance sales persons, who are people who
work in the partner banks IDBI and Federal, in sales.
Then there is a corporate head who looks after the corporate channel of sales.
Managing director
Head H.R
Cheif investment
officer
Legal and
complains head
Head bancasurance
Marketing and
product
devolopment head.
Cheif fincane oficer Cheif accturian
Cheif operating
officer
National head sales
The sales department is present in all the branches and the sales department is the largest
department and the back- bone of the company.

The hierarchy in the sales department is as follows:

H.R department:
The H.R department is based in the head office in Mumbai. There are no regional or zonal
heads there are H.R executives in each area who report to the head office, the branch
managers assist the H.R executives in their operations, further there are many trainers who
are in the different branches to carry out training programmes they report to the concerned
branch or area manager.
The decision regarding the service payroll etc are taken in Mumbai. The recruitment is done
at the area office level for lower level posts like agents and distributors.




Operations department:
The third department in the company is the operations department. The operations
department does the background work for the insurance products. The marketing,
underwriting , the product development, and the finance department comes under this. This
department in based in Mumbai at the head- quarters. This has no representation in the branch
offices they are supported by the branch heads.
The marketing department looks after the advertisement and methods for promotion of
products. The product development department is headed by the chief Acturian, who is
responsible for the development of new plans after then review of market and competitors.
The underwriting department is responsible for assessing the risks related to policies. This
department checks if any policy can be accepted or not. This department is based in Mumbai,
but there are underwriters in certain area offices where there are large quantity of business.
The finance department looks after the processing of the policies and the collection of money
etc. This department has 4 zonal heads, who are assisted by the Business service executives
The hierarchy in the operations department can be shown as follows:


The hierarchy explained above is not a water tight, this is a brief description of the functional
hierarchy. There sub sections like the legal & complains, the investment wing which do not
have a hierarchy as their size is small and their functions based form Mumbai only .






Chapter 4 Business process:












Business process:
Business process of a company explains how the company functions and how the day to day
activities of the company is carried out. The business process in IDBI Federal is as follows.
Finding the customer:
The first part in the business process of an insurance company and the most important part in
the process is finding new customers or sales.
In IDBI Federal there are 4 channels through which sales is done they are:
Agency channel.
Corporate channel
Bancasurance channel.
Direct market channel.
Agency channel:
Agency channel is the most important marketing channel in an insurance company. The
agency channel can be said to be the pillar of any insurance company. The agency is the
major source of business in any insurance company.
Generally agents or advisors are those people who go directly into the market and canvass
customers for the company. Generally anyone who has basic education (up to class 10) is
eligible to become an agent. But those having excellent social contacts are considered better
for this post.
In IDBI, agents are not direct employees of the company and are not in the pay-rolls of the
company. They are recruited by the sales managers of the company and get remuneration as
commission on the policies they sell to the general public. The agents also have an
opportunity to get bonuses and other remunerations like free holidays etc.
Earlier any person could become an agent, but now they have to prepare, write, pass an exam
by IRDA and get a licence in order to become a genuine agent.
The agents are controlled and monitored by the sales managers. The agents are under the
responsibility of the respective sales managers and the sales managers are accountable to the
quantity of sales their agents make. The sales managers are reporting to the respective branch
managers.
All the agent and the sales managers are monitored by the zonal and national agency channel
heads.
Corporate channel:
This is another way through which sales is done. This channel deals with high end customers.
They focus on corporate clients who have a potential high business. This channel is
comparatively small when compared to other channel and deals only with very big clients,
having the potential to make very huge business, like business heads.
Bancasurance:
The bancasurance channel is a major source of business for the company. This channel
includes the employees of IDBI Federal, who are in the partner banks i.e., IDBI Bank and
Federal Bank. The employees in this channel are present I the branches of these banks and
bring business from the customers of these banks.
Direct marketing:
This is the newest method of sales in IDBI Federal. This includes the sales that come directly
to the company. This is mainly through the web-site of the company, through any person can
review the products and purchase any product directly from the site itself. This is one channel
which is the least costly for the company as there is no question of commission in this case.
The total premium generated by each of the methods during the year 2012 is as follows:
Channel Sales (crore
Rs)
Bancasurance: 206.88
Agents: 62.33
Direct selling: 22.7
Corporate 0.08



Background processes:
Though sales is the major process and the heart of operations in IDBI Federal, there are some
other functions which are discussed below which are also essential in ensuring the smooth
running of the business organisation.
Processing the application:
The application is received from the agent by the business service executive, who receipts the
cash and checks the form and the documents and fill in any additional forms to ensure that
the policy is legally valid.
Underwriting:
Underwriting is the major part of the processing procedure for any policy. The underwriters
check if the policy can be allotted to a particular person. The underwriter also ensures that the
documents are in proper place.
The underwriting department functions by checking each policy against certain guideline and
rules which are given by the company and strictly follow them. The underwriter also ensure
that the Anti-money laundering form is filled and all the necessary paper work is completed
for the policy.
In short the underwriter checks of a policy can be assigned to a person.

Product development:
The insurance sector has a large number of competitors, any company can stay ahead only if
it continuously develop new products, different form the other players in the market. This job
is done by the Actuary department. The Actuary department headed by the chief actuary
does market research and develops new products which are different and also which provide
profitable returns to the company. The acturiansjob is one of the most highest paid jobs in
the company and usually it is done by an expert in the field.
Investment wing:
Insurance has now become an investment tool. The investment wing ensures that the money
that the client gives to the company is invested in the proper funds and ensures that the
customers money grows and that the customer get enough returns on the money invested.
This department ensures profitability for both the customer as well as the company. This is
done by fund managers in the investment wing. This wing is based entirely out of the
headquarters in Mumbai.
Legal and complaints wing:
As insurance is a customer oriented product there are chances that there may be complains
and unhappy customers. This wing deals with the complains. There may also sometimes arise
legal issues and cases in courts this department ensures that the legal problems are also dealt
with. This department also looks after the legal issues arising when there are claims to
policies.
Marketing wing:
Though a majority of the sales happen through agents, the products also need to be marketed
in the market .the marketing strategy of the company is developed by this department. This
department designs advertisements and other marketing techniques to increase the presence
of the products in the market.

Management of staff:
The company follows a system of management for the staff, where each staff has a
designated person to report to a well designated person, who is responsible for all the action
of the persons who are under his authority. This system starts from the agents to the national
head. This could be explained as follows:
The lowest part of the organisation is the agents or advisors, they are the base of operations.
Each agent is reporting to a particular distribution manager. The agent is managed by the
sales manager right from the time of his recruitment. It is the sales manager s responsibility
to ensure that the agents under him perform well. The distribution manager is also
responsible for all the other things, including the training of the agents. In this way, there is
accountability.
Each distribution manager reports to the branch head under which he is. It is the branch heads
responsibility to ensure that the managers under him perform well and meet the sales targets.
The branch managers also ensure that the distribution managers are trained well. The branch
managers also, conduct interviews for the distribution managers under them and also do the
appraisal of these managers.
Through this system of people management, there is high degrees of accountability. This also
ensures that the performance of employees are measured effectively.










How is an application processed:
An application, here refers to one policy. A single policy goes through the following process
before it is accepted.
Finding the customer:
This is the first step in the business process. This is also the most important step in the
process. Once a potential customer is found out, the customer is given a Proposal form to
fill. Here the customer fills all his details truthfully and attaches the identity proofs, the
photographs etc . The customer also gives the money in the form of cheque
Processing the application.
Once the application is completed, the application then reaches the branch office. Here the
application is checked and any doubts are cleared. The money paid is receipted and
temporary receipts are generated. The details are then entered into the computer.
Underwrite the application:
Once the application is entered into the computer and processed, the application undergoes
underwriting. As discussed earlier, here it is checked if the application is passable or
acceptable. This is done in the branch or in Mumbai according to the amount of premium
received.
Money transfer:
Once money reaches the branch, the money is transferred to the head-quarters. This is done
on a daily basis by a separate firm CMS.
Transfer the application to head office:
The application is then sent to the head office in Mumbai. Here the application is again
scrutinised and the details given in the application confirmed. Usually the client is
telephoned, to confirm with the details.

Sending the bond:
After the confirmation and underwriting the processing is finished. The customer then
receives the insurance document in his home address. This document contains details of the
plan with all the terms and condition and also a copy of the application form.
Free look:
After the customer gets the policy document in his hands. If the customer feels that any of the
terms or conditions is not acceptable, he has an option of doing a free look. In this the
customer will get his full money back, if he is not satisfied with the terms, the only clause is
that it should be done within 15 days from the receipt of the policy document.


Customer service:
This is the most important part once the first premium is received then the customer service
wing clears any doubts of the customer. This also ensures that the customer is reminded in
the proper time during the next premium payment time.

























Chapter 5: Management Techniques:
Management techniques:
The company has a several special management techniques specially in the fields of training
and H.R.
Branding of products:
IDBI Federal, has introduced a new marketing technique of branding all its products as a
separate and attractive name. The company has developed new names for all its products like:
Incomsurance for the guarantee income scheme.
Bondsurance for the fixed return schemes
Loansurance for the mortgage insurance
These new names for the products had resemblance to insurance and also gave a brief on
what it was form the name itself. By creating these new terminologies the company has
become successful in creating a name for itself .During the initial stages of the company the
company successfully launched its market linked insurance scheme Wealthsurance, by this
method. This scheme was marketed as the first wealthsurance scheme and the company was
called the first wealthsurance company

Growth:
1 Growth is an acronym for the facilities or special benefits an agent gets for the growth and
development of his career, they are:
2 Guarantee of working with big brands
3 Rewards and recognition: The agent earns commission for every policy sold. There are
different levels of recognition. There are different milestone levels and clubs according to the
number of policies a person takes. In short an agent gets an opportunity to become part of
elite clubs and earn monetary as well as other rewards like trips.
4 Opportunity to touch peoples lives.
5 Wealth building and protection
6 Training
7 Habit of success.
The company has branded these 7 tools as a method to attract new agents. By doing this the
management has branded these and developed a new method for attracting agents. This is an
planned set of tools the company has developed, as a new tool in attracting agents and also
during recruitment.

Rapid starter program:
To keep agents motivated, there is a program called rapid starter program. Here employees
who perform really high numbers of sales during the initial period of hiring are given extra
rewards. These rewards are classified as rapid starter Platinum , gold and silver based on the
amount of business they bring in during the initial one month of joining. The different levels
also get different levels of additional compensation

Clubs:
Advisors who bring in large volumes of business also have the opportunity to join special
clubs based on the levels of business they bring in. These clubs have many benefits like free
holidays, get-together. This ensures that the employees remain motivated.

Catalyst:
The company has developed a training institute in Mumbai, for giving specialised training for
the employees, both advisors and direct employees. This institute partnered itself with some
of the international H.R colleges to provide well designed courses. The catalyst institute had
been successful in developing well set training modules.



Personal management portal:
IDBI Federal has a computerised personal management system for tracking and organising
the performance of the employees especially members of the sales department . All
employees have to check into the system daily and update their performance and information
regarding the policies they have serviced and brought in. This system ensures that the
performance of the employees can be monitored effectively and any details regarding the
performance of employees can be found out.

Promotion policy:
The company has a well set promotion policy which ensures that the employees are judged
effectively for promotion.
Since the distribution managers, are the largest group in the company, the company has well
set promotion policy for any distribution manager there are 13 promotion levels from a
distribution manager to that of a Managing director. The basis of promotion for distribution
managers is the CWRP or the credited written premium.
The minimum benchmark for any distribution manager is to achieve 130% of the CTC as
business annually, failing which continuously would lead to the termination. Based on the
CWRP there are different levels for promotion. In addition to the CWRP there are written
tests for certain higher levels of promotion. The annual premium brought in is the only
criteria for promotions and the total experience is not a matter of concern .

Appraisal policy:
IDBI Federal has a well set appraisal policy for its employees. The employees are apprised on
a scale ranging from one to seven. One to four is a bad score and seven an excellent score.
The appraisal process begins during the month of June. The employee first apprises himself
in and self-appraisal.
Then the supervisor apprises the employee and the details of this appraisal is given to the
employee to check for himself
Finally the company management does a final appraisal of the employee
It is based on this appraisal system that the employees eligibility for further compensation
and promotion is checked. Such a rigid system as this ensures that the employees are
correctly apprised and ensures that the employees know their strengths and areas of
improvement correctly.
In addition to the formal appraisal system existing. Employees who perform really well are
given special letters of appreciation form the managing director and other top management
teams























Chapter 6: Product mix
















Products offered by IDBI Federal
In the previous chapters we had discussed about the management part of the company. This
chapter deals with the back bone of the company, its products.
IDBI Federal has a very large and well developed range of products. These products range
from a very simple plans like Termsurance to plans offering multiple benefits like
Wealthsurance. These are targeted at customers of various economic conditions and life
stages. As discussed earlier each of the products have their distinctive name devised for
themselves as a branding strategy for the company.
The company has the following products:
Wealthsurance
Incomesurace
Lifesurance
Bondsurance
Healthsurance
Childsurance
Termsurance
Group microsurance

1 Wealthsurance:
Wealthsurance was the product which the company started with. The company started its
initial operations by taking this as main product for marketing. This is the premium product
of the company. This is an ULIP plan. The returns are linked to the market and based on the
NAV of the funds
Wealthsurance combines wealth creation and insurance protection into one powerful financial
solution. Unlike other investment alternatives, it allows you to ensure that your goals of
wealth creation are achieved even in the event of serious illness, accidents, disablement or
death.
This is plan with a variety of investment options, based on the amount of risks involved. In
this plan the customer has an option to either choose for himself on where to invest his funds
or can let the company decide on how and where to invest his funds. This plan has 13
investment options and 7 insurance cover options.
There are different types of wealthsurance products which differ in the payment option, the
choice of funds , the returns policy , and other operational aspects.
Wealthsurance

Maxigain Insurance Plan

Wealthsurance

Dreambuilder Insurance Plan

Wealthsurance

Premier Insurance Plan

Wealthsurance

Milestone Plan
This is aimed at the customer who is willing to take risks and wants a very high return and
plan for creation of a substantial amount of wealth for himself.

Incomesurace:
This is a guaranteed return scheme of the company. This is a plan where the customer has a
choice of endowment and money back policy. This scheme provides insurance cover for the
customer with guaranteed returns. This policy gets returns based on investment in
government security bonds.
Incomesurance gives you Guaranteed Annual Payout for the Payout Period chosen by you. It
is an ideal plan for those who seek to ensure timely and regular availability of income. It is
also ideal for anyone who likes guarantees and would like to have at least one guaranteed
income generating financial plan to create future income.

In this plan the customer invests a particular amount annually for 5,10 or 15 years and gets
returns annually for 5 or 10 years. In a flexible time periodicity. The customer has flexible
payment and payout frequencies. Further this provides a two time tax benefit. The returns
received are free from tax, also the payments made can be deductible from the taxable
income

Termsurance:

This is the regular term insurance plan of IDBI Federal. This is an Endowment plan. This
policy provides a regular cover for the life of the insured person. This policy has many types
based on the need of the insured person.
This policy is an easy to apply policy and does not require any kind of medical check-up etc.
The premiums you pay are eligible for deduction from your income up to a limit of Rs.
1,00,000 per year under Section 80C and the benefits you will receive under your policy will
qualify for tax exemption under Section 10(10D) of the Income Tax Act, 1961, respectively.
The Termsurance plan is of the following different sub classification.
Termsurance protection plan:
This is the most important product in this range. This is an endowment plan aimed at
protecting the customer form the risk of loosing his life, financially. The insurance can be
made in different options. The payments can be made in a flexible way. The payments can be
made annually, half-yearly or even monthly, or even as a single payment. The term of the
policy can form 10 to 30 years and the payment can be made for 5 or 3 years also

Termsurance premium plan:
Termsurance seniors plan:
A no questions asked whole life protection plan that protects your loved ones after you.
This plan is designed to offer people over the age of 50, a whole life cover with guaranteed
acceptance. In other words, we will never say no, no matter what your health condition. One
can enrol up to the age of 85 years. The plan offers you life cover without the hassles of
going through medical tests and disclosures of medical reports. Also, the premiums will
never increase and you can also enjoy tax benefits u/s 80C and 10(10D).
Termsurance

Group Premium Return Insurance Plan

Customers are the most valuable assets for any organization. A good way of showing ones
customers that one care, is to offer them the cover of Life Insurance, which helps to provide a
secure foundation for the familys future in case of the unfortunate demise of the main wage-
earner. One can ensure this by opting for the IDBI Federal Termsurance

Group Premium
Return Insurance Plan that offers the benefit of a proportion of the premium being refunded
in case of survival at the end of the cover term.
Termsurance

Group Life Plan

The IDBI Federal Termsurance

Group Life Plan is a pure term plan designed to cater to a

wide variety of formal and informal groups such as the employer-employee groups, bank -
depositor groups, customer-supplier groups, professionals, and affinity groups
TermsurancegrameenBachat plan &Termsurancegrameensuraksha plan:
These are low cost micro-insurance plans aimed at the rural population.


Bondsurance:
Bondsurance is a single premium plan where one needs to make a one-time investment. One
can choose a maturity period of 5 or 10 years. At the end of the chosen period, one will
receive a guaranteed maturity amount. In case of death before the maturity date, a Death
Benefit which is also guaranteed will be paid.
Thus one can get life insurance cover while earning an assured return on ones investment.
This product will provide dual benefits of returns on investment along with a cover for ones
life.
There are pre-set rates for every 1000 Rs to be got after the maturity period; this rate varies
with the time period and also the age of the person. On an average the policy gives a return of
6% on the investment of the customer along with a life cover. There are also options to get a
loan on the Bondsurance policies by different banks.
The premium paid and the benefits received are free form income tax under section 80C and
10D. The minimum premium paid is 20,000 and there is no maximum limit.


Childsurance:
Childsurace is a childrens investment plan, which is based on the market. This provides a
return for the investment along with a death benefit.

There are options to pay premiums for a limited period of time or the entire duration of the
plan. There are further options to pay top up premiums also.
There are options to invest in 6 different of funds of various risks and return combinations.
This can be done according to ones own will or with a systematic allocator.
One will receive Guaranteed Loyalty Additions at the end of specific terms as a reward for
making long-term investments. Premiums paid are eligible for deduction from taxable income
under section 80C. Maturity amount is exempt from tax under section 10(10D). Withdraw
funds in case of need, after five years.


Healthsurance:
Healthsurance is a health insurance product offered by IDBI Federal. If one is aged 18 years
to 55 years and currently in good health, this new insurance plan is designed to help one
manage the extra financial burden that comes with hospitalisation, by providing a wide range
of attractive benefits.
The premium amount is set for the age group and the daily limit of hospital cover. Along with
the daily hospital cover there are additional benefits of 10 times the daily cover for major
surgeries and operations.

Loansurance:
Loansurance is a cost-effective way to ensure that the outstanding debt is settled in the
unfortunate event of death of the insured member. This term assurance plan provides cover to
a person directly liable for loan repayment (and the partners, in case of a partnership), as per
the benefit schedule. There are two options of level cover and reducing cover in this.

Lifesurance:
Lifesurance is a participating endowment plan that provides returns along with a life cover
the person insured.
It is a guaranteed plan that allows one to accumulate considerable savings to meet ones
responsibilities in life. This provides guarantee benefits along with additional riders. The
IDBI Federal Lifesurance Savings Insurance Plan offers one the benefit of a death cover that
provides financial security to ones family in ones absence.



Homesurance:
Homesurance Protection Plan is a mortgage reducing term assurance plan - MRTA, which
provides insurance cover equal to the outstanding balance of ones home loan. In the
unfortunate event of death of the home loan borrower, the insurance cover enables repayment
of the home loan liability so that it does not become a burden to the family
The Homesurance Protection Plan offers flexible premium payment options to suit ones
convenience. One can choose to pay ones premium in 3, 5 or 10 annual instalments or a
single one time premium. One can also pay up to 2 premiums in advance by commuting them
at a discount.

Group microsurance:

This is a group insurance plan for a group of people of more than 20; this is a policy with
indefinite term.


Market positioning of the products:
Of all the products for IDBI Federal, Incomsurance and wealthsurance are the key products.
Both these products contribute more than 50% of the total market share of the company. The
star in the company is Wealthsurance and the company started itself as the first wealthsurance
company in India. Wealthsurance is a registered trademark of IDBI Federal.

Of all the products in total the following products are marketed by the agency channel:
Incomsurance
Wealthsurance
Lifesurance
Childsurance
Bondsurance
Termsurance

The bancasurance or the Banka channel markets the following products exclusively along
with the other products:
Loansurance
Homesurance
Market share of products:
The market share of the products could not be obtained. Below is the market share in
numbers for the products in the Kochi branch. This figure would give a rough picture of the
market share in India.
As seen in the figure the main product the company sells is the Incomsurance and the
wealthsurance plans. The market for other products dare comparatively low.







62%
24%
5%
5%
2%
1% 1% 0% 0% 0% 0% 0%
Incomesurance
Lifesurance Suvidha
Wealthsurance milestone
Lifesurance Saving
Termsurance protection
Cildsurance dreambuider
Bondsurance
Termsurance premier
Healthsurance
Wealthsurance dreambuilder
wealthsurance mxigain
Wealthsurance premium







Chapter 7: Analysis of the company:













From the two months spend in the company some of the analysis of the company is as
follows:
SWOT Analysis of IDBI Federal Life Insurance Company:
Strengths:
The strengths of a company are those factors that are there in the company which support the
company and are beneficial in the companys operations. These are internal factors of the
company. Some of the strengths in the perspective of IDBI Federal are as follows.
Association with strong brands especially a government owned bank like IDBI will be
effective in developing a good reputation for the company.
A very strong network of sponsor banks, IDBI Bank and Federal bank two of India
largest banks, is a major source of business and is an effective way to get new and
worthy customers.
Availability expert suggestions and guiding from expert bankers from IDBI and
Federal bank.
Dedicated pool of agents and sales force that are ready to make careers.
Availability of multiple marketing channels, through agents, through sponsor banks
and corporates
Highly effective training, motivation and other H.R policies followed.
Unit linked plan Wealthsurance has one of the highest NAV values.
An excellent place to work.
Large network of agents and 106 branch offices, present on almost all states of India.
Efficient use of technology to improve operations, both for providing better customer
service and also in employee management.

Weakness:
Weaknesses are the factors that are hindering the growth of the company. These are internal
factors in the company itself. These factors arise due to the inefficiencies in the operations of
the company. Some of the weaknesses in IDBI Federal are:
A comparatively new company in the insurance sector.
Decline in number of advertisements and promotion events for the company.
The product range could is not so wide and there are some gaps in the range of
products for some sectors.
The company has good presence in urban and semi- urban areas only. There is very
less presence in the rural market.
IDBI Federal does not have a large presence in the market,
A majority of customers are not aware of the company or do have confidence in the
company.
The online presence of the company is low, though the company has an excellent web
site; there are very less advertisements and other promotions happening.
The company lacks effective micro-insurance plans
The company focuses only on certain products.
In efficient coordination among the different marketing channels and the arising of
channel conflicts.
Opportunities:
Opportunities are the external factors for the company that are helpful for the company to
grow. The company has to capitalise on the opportunities well if it has to grow fast. Some of
the opportunities for IDBI Federal are:
India has the worlds second largest population; this gives the company a huge sea of
prospective clients.
Further insurance penetration in India is very low (close to 7%); this further increases
the number of prospective clients.
The Indian economy is one of the fastest growing economies of the world, further the
per capita income of people is ever increasing, which means people have more money
with them, which is a very good sign for companies to invest.
The rising number of middle class with more money to invest
New regulations by IRDA have brought back confidence in a majority of customers
Threats:
Threats are the external factors in the company. These threats are a barrier to the efficient
functioning of the company. Some of the threats which IDBI Federal faces are:
A general disbelief in private companies.
Public sector companies notably LIC are very huge, the general public have more
belief toward them.
The coming out of many fraudulent financial companies, recently have further created
disbelief in customers.
Fluctuating stock market, which affects the performance of ULIP plans
Coming up of more alternative forms of investment like Mutual Funds, Gold, fixed
deposits
The presence of a large number of competitors in the market.

The swot analysis can be made concluded in the following table:
Strengths:
Strong sponsoring brands, IDBI and Federal
Large network of sponsor banks, a large
source of sales.
Expert suggestions form banking experts
Dedicated pool of employees and sales force.
Highly effective HR policies followed
Unit linked plan Wealthsurance has one of the
highest NAV.
Efficient operations and large network of
branch office 106 numbers.
Weakness:
New to the insurance industry.
Lack of advertisements and promotional
activities.
Narrow range of products.
Lack of presence on rural and semi urban
areas.
Very little online presence and online
advertisement campaigns
Focus on promotion of only some products
Inefficient coordination among the different
channels
Opportunities:
Large, growing population of the country.
Very less insurance penetration of insurance
among the population.
Indian economy growing at very fast rate with
the rising money with the middle class.

Threats:
High amounts of competition
General disbelief in private companies.
The presence of LIC as a public insurer.
Unstable stock market
More fraudulent financial companies coming
up.
Alternative forms of investment gaining more
prominence.
















Key financial data:
IDBI Federal collected a net premium of Rs 8,04,8,34,000in the financial year of 2012-2013.
This was 10% more than the previous years premium collected of Rs7367037000. The net
premium collected amounted to
The company had its first profits since its incorporation in 2008, the net profit for 2012-2013
was Rs9,24,32,000. This was in comparison to last years loss of 3624924000.
The company has a net EPS of 0.12Rs this year compared to the last year when there was a
negative EPS of -0.90.
IDBI Federals New Business Premium (APE) grew by 23% in 2012-13, which compares
with the negative growth of -15% posted by the industry. The company also witnessed a 44%
increase in the number of new business policies sold as compared to the previous year.
IDBI Federal had a 13
th
month persistency percentage as 74.84%, compared to the last year
of 71%.
Commission ratio: i.e., total commission/ net premium= 10.95% and paid a total premium of
880883000Rs in the last year.
The company has assets worth Rs 2,732 crore under its management. (AUM)
The net profit ratio of the company is 11.4%, in the financial year 2012-2013
The Return on investment ( ROI) for the firm is 10.2% ,in the financial year 2012-2013.
The solvency ratio of the company 49% as against the regulatory requirement of 150%.
The current ratio is 1.4
Brief on the companys capital structure:
The company has issued share capital of 800,00,00,000Rs share of which 26% is held by
Ageas , 26% by Federal bank and 48% by IDBI Bank, the company is not listed and does not
have any public shares. The company has also no borrowings as of now and is completely
funded by the shareholders funds. .As IDBI Federal has a backing of financially sound
companies like IDBI Bank and Federal Bank, the entire capital for the company is funded by
the banks. The capital is further supported by the funds of policy holders which are usually
held for longer durations.








Chapter 8: Kochi branch















Introduction:
The branch where I was working was the Kochi branch of IDBI Federal. The branch was
situated in Vytilla. The office was the area office of the Kochi region, this office acted as
headquarters for entire. This area office has three area offices i.e. Kochi, Calicut and
Trivandrum. The Kochi has a three branch offices brought together and there are three
separate branches Kochi-1, kochi-2 and Muvatupuzha.
In the Kochi areas office there are a total of 32 employees. The office was started the only
office in Kerala in April 2008, then it geo divided into three area offices. And each area
office got divided into branch offices.
There are no well- defined departments as such in the office some of the major wings of the
branch are:
Marketing / Sales:
This is the back bone of the company. This department looks after the sales of policies. This
section is the life line of the company and performs the major function of the company, to
find prospective customers and to convince the customer to buy the product.
There are 3 branch managers of the three branches who control a total of are 21 distribution
managers who look after a set number of agents. The distribution managers manage and
control the agents under them. As the agents are no direct employees of the company and are
not in the rolls of the company it is the distribution manager who manages the agents. The
distribution managers report to the branch head.
Training:
As this office is a head-quarter of Kerala all the trainers in Kerala are based out of this office.
The major function of a trainer is to conduct training programs for the employees as well as
the agents. The trainers ensure that the employees and the agents are well versed with the
different products they sell and also with the H.R, the incentive policy etc the company
follows. The training department ensures that the sales force carries out its work efficiently.
The trainers also conduct classes and seminars for the general public, including college
students, not only on the different aspects of the products and the insurance sector, but also
on general topics like personality development.
Finance:
The major function in the finance department that is performed in the Kochi office is
underwriting. All other financial work is done at the headquarters in Mumbai The
underwriter checks weather the policy can be allotted to a certain person looking at various
criteria and check-lists given by the company.
The underwriter does the underwriting for all policies in the Kerala region. The underwriting
is done for policies with a premium of less than 100000. All other policies are underwritten in
the head office in Mumbai. Usually all policies are underwritten in Mumbai but since the
number of policies were high in Kerala was high the process was changed for the quick
delivery and service of policies.
Service:
The service department looks after the service of policies. There is one business service
executive in the Kochi branch. The B.S.E ensures that the customers are treated well and the
doubts of the customers who call to the office are met. The B.S.E also ensures that the
policies are serviced well. It is the B.S.E who receives the documents and ensures that the
documents are in proper place. The B.S.E also does the entry of data into the computer. B.S.E
also deals with the receiving of cash and the billing and receipting.
In short the B.S.E acts as a link between the company and the customer; it is the B.S.E who
processes the applications for the policies.
Housekeeping:
The house keeping department is one another department. This section ensures that the
premises of the office are kept clean. It ensures that the A.c is working properly and looks
after the general wellness of the office and employees. They also receive and post letters and
couriers and do any jobs that help the smooth running of the office.




The functional hierarchy of the Kochi branch


The working of the branch:
The Kochi branch as discussed earlier has 4 major sub divisions; the highest number of
workforce is in the sales section. The distribution managers come and report daily in the
office at 10: 00 Am a daily meeting is conducted, where all the managers discuss their
developments and their progress. They also report to the branch head this is done at the start
of the day. The managers can also check and enter their progress into the personal
management system. Then after doing this the managers proceed to the outside to their field
work. They dont always have to sit at the office
The business service executive is at the reception. It is the B.S.E who receives the
applications for the policies and processes the applications, receives the cash and enters data
into the system. Any customer who comes to the branch for any doubts are also handled by
the B.S.E
The cash and the cheques are cleared daily by a Cash Management System (CMS), which is a
private set- up, which clears the cash received during that day and delivers it to the head
office.
Area head
Branch
head(kochi 1)
Branch head
Muvatupuzha
Branch head
Kochi 2
Underwritter Trainers
Business service
executive
Manager
disrtibuton 1
Agent1
Agent 2
Agent 2
Manager
disrtibution 2
Agent 3
Agent 4
Agent 5
Banka channel
The training department conduct meetings and seminars for the employees and the agents for
this there is a separate training room.
The underwriter underwrites the policies received which are less than 100000.
These are the major functions in the branch. It can be found that the amount of work other
than sales, which is done at the Kochi branch level, is limited. All the other functions form
H.R management to the management of funds is done at the head-quarters.






















Chapter 9: Routine work














Routine work:
As the part of the project work, I had to do a routine work. As the routine work, the interns
had to do a work of an advisor (agent). We had do sales of a product. We were asked to sell
the product, Incomesurance. As this product was a guarantee returns product and not linked
to the market, this product was easier to explain. The benefits could be easily depicted and
explained. This is why we were asked to sell this product as starters who did not have much
experience in sales.
How was the work done?
To carry out our routine work efficiently we followed a planned way of carrying forward the
work. There was a well set plan and we knew what to do exactly.
As a first part of the routine work we were given a brief introduction to the insurance industry
and financial terms, to make us understand the industry well, so that we would have enough
knowledge to work in the industry
We were also given a detailed explanation about the product we had to sell, Incomesurace.
We were given complete details of how the product functioned. We were also told the
important documents and the procedures to be followed to process the applications.
We were asked in the beginning to market the product among our very close family and
friend circle. Then, we worked by getting contacts from these contacts. This was the first set
of people whom we could contact to sell our product. We were first asked to identify and list
down 50 contacts that, this is the first step in the sales process called prospecting.
As the second step of the sales, ensure that the work be done efficiently, we were given a
particular target as in a particular number of application, with a particular amount be closed
before a given date. There were different slabs set according to the different numbers of
applications closed and the amount of premium collected in a particular span of time. By
doing this we could break down the goals so that we could achieve it easily. There were
additional rewards for these different slabs.
Along with setting targets, we were also informed about the incentives and certificates that
would be given once a target was achieved. This ensured that we remained motivated and
brought more business for the company. This was a motivation technique the company
followed to increase the business.
A daily report had to prepared and sent to the office daily stating the details of the
prospective clients met and their responses. This ensured that the progress in our work could
be measured and monitored.
There were also weekly meeting where the progress was evaluated and any suggestions and
classes were conducted. This was a method to ensure that we remained motivated and the
company could give us the enough guidelines and monitor us continuously.
As interns we used the referral marketing technique to gain more customers. From the 50
initial prospects, we were able to get more clients and able to meet them.
This is the base of what I did as my routine work.
Observations made during the routine work:
During the two months I did my routine work, I could meet a lot of people directly and could
understand the pulse of the market. Some of the observations I made during my routine work
regarding the industry, the company and the product are as follows:
The insurance market in Kerala, especially the urban market has become full. A large
majority of people in Kerala have already taken at least one insurance policy.
The Kerala market has the presence of a large number of agents of almost all insurance
companies
LIC still remains the preferred insurer for a majority of people, mainly due to the
government owned tag attached to it.
A substantial number of people have taken an insurance policy only for the purpose of getting
tax benefits.
A large number of people who have taken insurance do not have a complete knowledge of
their plans or the benefits they get.
Financial literacy among people is less. Many people do not know what a ULIP is or about
investment option other than fixed deposits.
There are a lot of misconceptions and disbelief in peoples minds regarding the financial
sector.
The general public does not have the confidence to invest in market related plans due to the
failure of such plans in the past especially during the 2008-2010 periods.
There is a general dissatisfaction among people with regard to the customer service provided
by insurance companies.
People in Kerala give a lot of importance to advertisements.
A sizable number of people were not ready to invest with IDBI Federal as the company was
not known to them and there were no advertisements
A sizable number of people were not ready to invest with IDBI Federal as the company was
not known to them and there were no advertisements
A majority of people have taken policies because of the commitment towards the agents, not
because they have genuine interest.

Suggestions for the improvement:
From the observations made during the course of the routine work some suggestions for the
product improvement are as follows:
The marketing of products must not be restricted to agents, there must be more focus given
on advertisements.
The company should resume their old advertisements and have a competitive advertisement
strategy to meet the competition and to make its presence in the market more profound.
The company has to increase its presence in business magazines and must bring in more
writings and reviews.
The company can use social media and the internet and increase sales through direct channel.
There is a need to focus more on rural and semi urban areas as the company is presently
focusing more on urban areas only.
The agency channel must be further strengthened.
The company must spread its operations more evenly over all states of India.
New products with lesser premium amount aimed at the middle income groups as well as the
lower income groups can be introduced.
There can be more products introduced with single premium payment options.

The company can try to diversify its product range with a better health insurance and
retirement plans
The customer service and the follow up of policies must be improved to give the company a
larger competitive edge in terms of service quality.
There can be new products with focusing on the youth.
The company must give equal importance in marketing all its products. At present there is a
huge focus given to marketing Incomesurace and Wealthsurance.





























Communications with faculty guide: