PREFACE

PREFACE

At present Insurance Sector has emerged as one of the good

business amongst other. Everyone wants to get insure himself/herself because
nobody knows that what will happen in future. Except it everyone wants to
invest the money where it increases at a desirable rate with safety. These are the
reasons why insurance sector is getting the covent of people. Now Insurance
sector is expanding its wings without carrying any boundary. Large number of
companies are dealing in this field and trying to encash the potential customer.
Now a days the fastest growing insurance sector has also effected
the very big market & share.
Bajaj Allianz is one of the most renowned company in insurance
sector. It is one of the India's leading private life insurance companies.
Bajaj Allianz Life Insurance Company Limited is the joint venture
between Bajaj Auto Limited & Allianz AG of Germany. Both enjoy a
reputation of expertise, stability and strength. The company has an authorized &
paid up capital of Rs. 150 Crore. Bajaj Auto hold 74% & the remaining 26%
hold by Allianz AG of Germany.

2
 TABLE OF CONTENTS

S.No. PARTICULARS
1- Introduction
 Research Objective
 Research Methodology
 Research Process
 Executive Summary
2- Company Profile
 History of Bajaj Allianz Life Insurance Company Ltd.
 Products of the Company
 How does plan work
 Financial
 Objectives 2006-07
3- Insurance Industry
 Importance of Life Insurance
4- Main Report
 Graphical Analysis & Interpretation
5- Findings
6- Conclusion
7- Recommendation
8- SWOT Analysis
9- Limitations
10- Appendix
11- Bibliography
3
12- Glossary

INTRODUCTION

4
 ANATOMY OF PROJECT

FIRST OF ALL IT IS NECESARY TO UNDERSTAND THE

MEANING OF THE WORD PROJECT…

(P) "P" STANDS FOR WORD "PLANNING" WHICH DEALS WITH IDEA OF THE
THINKS WHICH IS TO BE DONE BEFORE CONSTRUCTION OF WORK.

(R) "R" STANDS FOR WORD "RESOURCE" MEANS THE GUIDE THAT HELPS TO
PRESENTS THE FUNCTION OF THE PLANNED AREA OF WORK.

(O) "O" STANDS FOR "OVERLOAD EXPANSION" OVER LOAD MEANS THE
ESTABLISHED EXPANSION WHICH MAY OCCUR IN THE
MANUFACTURED DESIGN & LAYOUT OF THE PROJECT WORK.

(J) "J" STANDS FOR "JOINT WORK" WHICH HAS BEEN PLANNED TO BE DONE
BY THE COMMON JOINT EFFORT THE ART WORK.

(E) "E" STANDS FOR THE WORK "ENGINEERING" SINCE FUNCTION IN THE
WORK IS TO BE DONE BY THE TECHNICAL PERSON UNDER THE GUIDE"

(C) "C" STANDS FOR "CONSTRUCTION" WHICH IS VERY NECESSARY PART

OF LIFE.

(T) "T" STANDS FOR "TECHNIQUE" SINCE UNDER THE TECHNIQUE WORK IT
IS EASY TO DESIGN A PROJECT.

5
RESEARCH
OBJECTIVE

6
 RESEARCH OBJECTIVE

Research objective is the basis theme on which the survey is

conducted and on which the whole report depends.

The main Objective is :-

 To study about the "Awareness of Life Insurance and changing
investment pattern"

The Sub-Objectives of this survey are :-

 To study the investment pattern of people.
 To study the investment pattern of people in Life Insurance.
 To observe the extent of the market.
 To recognize the target groups.
 To find out which type of insurance is preferred by the investors.
 To study the factors responsible for the low investment in Life Insurance.
 To study the different facilities of Life Insurance given by different
companies.
 To study the risk factor involved in Insurance.
 To study which company is providing better services of Insurance with
higher returns.
 To study the behaviour values and beliefs of customers.

7
 RESEARCH
METHODOLOGY

8
 R ESEA R C H M ETH O D O LO G Y

Research methodology is used to search answers of the research

questions. An attempt has been made to describe the nature of the people of
Lakhimpur-Kheri city by the study of the samples.
Methodology in common parlance refers to a search for knowledge.
The advanced learner's dictionary of current English lays down the meaning of
research as "a careful investigation or enquiry especially through search for new
facts in any branch of knowledge" Some people

Consider research as a movement, movements from known to unknown.

It is actually a voyage of discovery. We all posses the vital instinct of
inquisitiveness for, when the unknown confront us, we wonder and our
inquisitiveness makes us probe and attain full and fuller understanding of the
unknown. This inquisitiveness is the mother of all the knowledge and the
7method, which man employs for obtaining the knowledge of whatever the
unknown, can be termed as research.
Methodology is a way to systematically solve the research problem.
It may be understood as a science of studying how research is done
scientifically.
Learning more about the consumer and about marketing is the heart of
the research methodology. The research methodology has many dimensions
research methods to constitute a part of the research methodology.

9
RESEARCH

PROCESS

10
 R ESEA R C H PR O C ESS

Problem Formulation

Research Design

Sample Design

Data Collection Technique

Field Work

Analysis and Interpretation and Research Report

In the planning of the project and survey, the entire schedule of work was divided
into 13 steps which are as follows:-
1- Defining the objectives
2- Defining the population
3- Frame the sample units
4- Data collection
5- Questionnaire
6- Methods of collecting data
7- Non-respondent classification
8- Selection of proper sample size
9- Organizing the field work
10- Execution of the project
11- Summery and analysis
12- Information gathered for the further survey
13- Preparation of the report

Let us understand all the 13 steps in detail :

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(1) DEFINING THE OBJECTIVE :-
The main objective is to find out the awareness of life insurance in
general public. This survey is conducted to depict the behavior of the people in
making investment, especially in insurance.

(2) DEANING THE POPULATION:-

Population refers to the total items about which the information is
desired. Here in this project I have considered finite population that is we are
taking one single individual as single unit which is fixed the 250 questionnaires,
each separately by the single individual.

(3) FRAME THE SAMPELING UNITS:-

The elementary units or the group of such units may form the basis of
sampling process. A list containing all such sampling frames consists of a list of
items form which the sample is to be drawn. It is often impossible to draw a
sample directly from the population.
In case of this project I simple located the different areas of Lakhimpur-
Kheri district and conducted a survey by taking the information in the form of
questionnaire.

(4) DATA COLLECTION :-

There are several ways of collecting the data which different
considerably in context of money, cost, time and other resources. In this project
the data which was required gave details about the behavior of people who
make investments in insurance, mutual funds, IPO, share market, etc.

(5) QUESTIONNAIRE
:-
12
 To develop an effective questionnaire following points should be kept
in mind:-
(a) Keep in view the problem to be studied.
(b) Questions should be appropriate and simple and must be
Constructed with a view to their forming a logical part of a well
thought out tabulation plan.
(c) Proper sequencing of questions.
(d) Should be examined properly and if error found, should be
Removed.
(e) Pre-testing of questionnaire is necessary.

(6) M ETHODS OF COLLECTING DATA:-

Normally there are 2 methods of collecting the data
(a) Primary data
(b) Secondary data
In this project we require data which is necessary to obtain the
secondary data. We have collected the information by directly
communicating with the respondents through questionnaires.

(7) NON-RESPONDENT CLASSIFICATION

:-
It is very necessary to classify the respondents from the sample who
didn't give proper reply while conducting the research. The reason for doing
this is that it may create a systematic bias.

(8) SELECTION OF PROPER SAM PLE SIZE

:-
A sample design is a definite plan for obtaining a result from the
given population. In this project the sample size is of 250.

(9) ORGANIZE THE FIELD WORK :-

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 Field work is done in this project individually with no biasness.
The field work comprises of filling of questionnaire by different sector
individuals.

(10) EXECUTION OF THE PROJECT_:-

Proper execution of the project is important. Steps should be taken

to ensure that the survey is under statistical control so that the collected
information is in accordance with the pre- defined standard of accuracy.

(11) SUMMARY AND ANALYSIS OF DATA :-

Once the date is collected the next task is to analyze it. The raw
data should be classified into some purposeful usable categories. For
example: tabulation, coding, etc.
Analysis work, after tabulation, is generally based on the
computation of various percentages, coefficients, etc. by applying various
well defined statistical formulae. Here in this report it is found that the
investment pattern of people in private insurance companies is not
satisfactory .

(12) INFORMATION GATHERED FOR FUTURE SURVEY :-

The information gathered for further survey is summarized as
under :-
 Very less number of people is interested to invest in private insurance
companies.
 People prefer other options available of investing their money rather than
Insurance.
 Very less number of people, in Lakhimpur-Kheri city, knows about India
BAJAJ ALLIANZ and its working.

14
  Maximum number of people expect "low risk with high profits" while
investing in any financial product.
 Almost all the people take the insurance plan from Insurance agents.

(13) PREPARATION OF' THE REPORT :-

Final report is prepared according to the work done. Following
points must be kept in mind in this regard:-
* The layout
* Report should be concise and simple
* Proper graphs and charts must be used for the explanation.
* Limitation in the report should be clearly, mentioned.

RESEARCH PROCESS ADOPTED :-

Research Area : sitapur

Sample Size : 250
Primary Data collected : Through Questionnaire
Secondary Data : Through Internet,Brochuers,Company’s
Issues etc.

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EXECUTIVE

SUMMARY

16
 EXECUTIVE SUMMARY

In this competitive market where customer is the king, it is

important to analyze the customer preception about the product. Companies, by
conducting various market researches, try to improve their products and provide
customers better and more services.
As without putting customers on the top no company can get
success. For achieving success every company should target customers because
the market is totally market oriented.
The report is prepared for the partial fulfillment of MBA
programme and as a part of curriculum.
The report is an attempt to find out the "Awareness of Life
Insurance in General Public" with special reference to "Bajaj Allianz Life
Insurance Company Ltd.".
This exploratory research is being conducted by survey on the
people of Lakhimpur-Kheri.
The survey was conducted through questionnaires by personally
interviewing each respondent on a number of queries structured in the
questionnaire.
The data thus collected through survey was organized in a
database, which could be referred for future endorsements. The data thus
collected was the subjected to analysis by a mixture of common and advanced
statistical technique.
The above mentioned survey was conducted on 250 respondents.
The respondents were selected from different parts of Lakhimpur-Kheri city.
The respondents were taken from various sectors viz.-Servicemen,
businessmen, housewives, students etc.

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 The study has been divided into various chapters all explaining
Bajaj Allianz hegemony in the current market, its foray into the Indian market
and its present conditions.
It was found in the survey that many people are not of the modern
Life Insurance Investment Schemes.
It is found that still LIC is the strongest competitor for the private
insurance companies like :- Birla Sun Life, Tata AIG, HDFC, ICICI Prudential,
AVIVA etc.

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COMPANY PROFILE

19
 HISTORY OF BAJAJ ALLIANZ

Bajaj Allianz Life Insurance Co. Ltd. is a Joint Venture between two
leading conglomerates - Allianz AG, one of the world's largest insurance
companies, and Bajaj Auto, one of the biggest 2 and 3 wheeler manufacturers in
the world.

Bajaj Allianz Life Insurance

 N o .1Pvt Life Insurer FY 2005-06. Leading by Rs. 78 Cr.

 N o .1Pvt Life Insurer in Retail Business. Leading by Rs. 339 Cr.

 Whopping growth of 216% for the FY 2005-06

 Have sold over 13,00,000 policies to satisfied

customers

 Is backed by a network of 550 offices spanning the country

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 ABOUT BAJAJ ALLIANZ LIFE INSURANCE
COMPANY

BAJAJ ALLIANZ LIFE :-

A Household Indian Name teams up with, global conglomerate.

ALLIANZ GROUP :-
A global giant with operations in over 70 countries.

BAJAJ GROUP :-
Bajaj Group managing funds over Rs. 4000 Crore.

BAJAJ ALLIANZ GENERAL :-

The fastest growing general insurance company in India.

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Vision
• To be the first choice insurer for customers

• To be the preferred employer for staff in the insurance industry.

• To be the number one insurer for creating shareholder value

Mission
As a responsible, customer focused market leader, we will strive to understand

the insurance needs of the consumers and translate it into affordable products

that deliver value for money.

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 BAJAJ GROUP

Bajaj Auto Ltd. the flagship company of the Rs. 8000 crore Bajaj
group is the largest manufacturer of two-wheelers and three-wheelers in India
and one of the largest in the world.
A household name in India. Bajaj Auto has a strong brand image &
brand loyalty synonymous with quality & customer focus.

A STRONG INDIAN BRAND - HAMARA BAJAJ

One of the largest 2 & 3 wheeler manufacturer in the world.
 21 million - vehicles on the roads across the globe.
 Managing funds of over Rs. 4000 Cr.
 Bajaj Auto finance one of the largest auto finance cos. in India.
 Rs. 4744 Cr. Turnover & Profits of 538 Cr. in 2002-03
 It has joined hands with Allianz to provide the Indian consumers with a
district option terms of life insurance products.
 As a promoter of Bajaj Allianz Life Insurance Co. Ltd. Bajaj Auto has the
following to offer -
• Financial strength and stability to support the Insurance Business.
• A strong brand-equity.
• A good market reputation as a world class organization.
• An extensive distribution network.
• Adequate experience of running a large organization.

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 ALLIANZ GROUP

Allianz Group is one of the world's leading insurance & financial services
providers. Founded in 1890 in Berlin, Allianz is now present is now present in
over 70 countries with almost 174000 employees.
At the top of the international group is the holding company, Allianz AG.
with its head office Munich. Allianz group provides its more than 60 million
customers worldwide with a comprehensive range of services in the areas of
1- Property and Casualty Insurance.
2- Life and Health Insurance.
3- Asset Management and Banking.

ALLIANZ AG - A GLOBAL FINANCIAL POWERHOUSE

 Worldwide 2nd by Gross Written Premiums - Rs. 4,46,654.00 Crore
 3rd largest Assets Under Management (AUM) & largest amongst
Insurance cos. AUM of Rs. 51,96,959.00 Crore.
 12th largest corporation in the world
 49.8% of global business from Life Insurance.
 Established in 1890, 110 years of Insurance expertise.
 70 Countries, 173750 employees worldwide.

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 WHY BAJAJ ALLIANZ?

The Bajaj Allianz Difference

• Business strategy aligned to clients needs and trends in Indian and global
economy industry.
• Internationally experienced core team, majority with local background.
• Fast decentralized decision making.
• Long-term commitment to market and clients.

Trust
At Bajaj Allianz it is realized that everyone seek and insurer whom
they can trust. Bajaj Auto Limited is trusted name for over 55 years in the
Indian market and Allianz AG has over 110 years of global experience in
financial services in over 70 countries. Together we are committed to provide
you with time tested and financial solutions that provide you all the security you
need for your investments.

Underwriting Philosophy
Our underwriting philosophy focuses on :
• Understanding the customer's needs
• Underwriting what we understand
• Meeting the customer's requirements
• Ensuring optimal coverage at lowest cost

Claims Philosophy

25
 The Bajaj Allianz/team follows a service that aims at taking the
anxiety out of claims processing Bajaj Allianz pride itself on a friendly and

open approach. It is focused towards providing customers a hassle free and

speedy claims processing.
Our Claims Philosophy is to :
• Be flexible and settle fast
• Ensure no claim file to be seen by more than 3 people
• Check processes regularly against the global Allianz OPEX (Operational
Excellence) methodology.
• Sold over 1 million since inception.

Customer Orientation
At Bajaj Allianz the guiding principles are customer service and
client satisfaction. All their efforts are directed towards understanding the
culture. Social environment and individual insurance requirements - So that
Bajaj Allianz can cater to all customer's varied needs.

Experience and Expert Servicing Team

Bajaj Allianz is driven by a team of experienced people who
understand Indian risks and are supported by the necessary international
expertise required to analyze and assess them.
• Serving engineers located in every major city.
• Superior Technology
In order to ensure speedy and accurate processing of customer's
needs. Bajaj Allianz had established world class technology with renowned
insurance software, which networks all their offices and intermediaries.

26
 Using the Web, policies can be issued from any office across the
country for retail products. Unique user friendly software developed to make the
process of issue of policies and claims settlement simpler (e.g. online insurance
of marine policy certificate)

• Unique Forms of Risk Cover

• Special PA cover for Amarnath Yatris
• Housing loan cover for people, who are suddenly unemployed
• Film Insurance
• Event management cover
• Sports & Entertainment Insurance Package
• Risk Management-Our Expertise

Service Methodology is tried, tested and Proven the World over

and involves :
• Risk identification : Inspections
• Risk analysis : Portfolio review and gap analysis
• Risk retention
• Risk Transfer : To an insurer as well as re-insurer (as required)
Creation of need based products on going Jialogue and proactivity

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 Indian Operations

Growing at a breakneck pace with a strong pan Indian

presence Bajaj Allianz has emerged as a strong player in India.

Bajaj Allianz Life Insurance Company Limited is a joint venture

between two leading conglomerates Allianz AG and Bajaj Auto Limited.

Characterized by global presence with a local focus and driven by

customer orientation to establish high earnings potential and financial strength,
Bajaj Allianz Life Insurance Co. Ltd. was incorporated on 12th March 2001.
The Company received the Insurance Regulatory and Development Authority
(IRDA) certificate of Registration (R3) No. 116 on 3rd August 2001 to conduct
Life Insurance business in India.

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Bajaj Allianz - THE PRESENT
• Product tailored to suit customer's needs.
• Decentralized organization structure for faster response.
• Wide reach to serve customer better - a nationwide network of 700 +
branches
• Specialized departments for Banc assurance. Corporate Agency and
Group Business
• Well networked Customer Care Centers (CCCs) with state of art IT
systems.
• Highest standard of customer service & simplified claims process in the
industry
• Website to provide all assistance and information on products and
services, online buying online renewals.
• Toll-free number to answer all the queries, accessible from anywhere in
the country can call at 1800 22 5858 and a strong tale-marketing and
Direct marketing team.
• Swift and easy claim settlement process.

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 TIE UPS WITH BANKS

Pioneers of Banc assurance in India

Having pioneered the phenomenon, Banc assurance is one our core
business strategies. Two of our strong Banc assurance tie-ups are.
• Standard Chartered Bank
• Syndicate Bank
We have developed a range of life insurance products exclusively for
our Banc assurance partners. Also our products are customized to suit. Pacific
needs of banks.

Bajaj Allianz Life Insurance

Agency Channel Bank Assurance

Branches Standard Chartered

Satelite Satelite Satelite Syndicate Bank

Branch Manager Various Co-operative Bank

30
 Assistant Branch Manager 7 RRB & Numerous Bank

SSTM SSTM SSTM

IC IC IC

PRODUCTS

We, at Bajaj Allianz, realize that you seek an insurer who you can
trust your hard earned money with.
Allianz AG with over 110 years of experience in over 70 countries
and Bajaj Auto, trusted for over 55 years in the Indian market, together are
committed to offering you financial solutions that provide all the security you
need for your family and yourself.
Bajaj Allianz brings to you several innovative products.

INDIVIDUAL PLANS
Innovative Plans for Individual Life Insurance needs.

GROUP PLANS
Competitive Plans for Group Life Insurance Needs.

INSURANCE FOR NRTS

Special NRI Offers.

31
 Individual plans
 NEW UNITGAIN
A Unit Linked Plan

 RISK CARE
Pure Term Plan

 TERM CARE
Term Plan with Return-of-Premium

 INVESTGAIN
An Endowment Plan

 LIFETIME CARE
Whole Life Plan

 CHILDGAIN
Children's Policy

 LOAN PROTECTOR
A Mortgage Reducing Term Insurance Plan

 CASHGAIN
Money Back Plan

 KEYMAN INSURANCE
A Promising Business Opportunity

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 SWARNA VISHRANTI
Retirement Plan

 NEW UNITGAIN PLUS

Unit Link plan with higher allocation

 RIDERS UNITGAIN PLUS

While the basic life insurance

 MAHILAGAIN RIDER
The unique plan that takes care of you and your loved ones

 NEW UNITGAIN EASY PENSION PLUS

A Plan that enables you retire with laughter lines.... not worry lines

 SWARNA RAKSHA-ROC
A plan that provides you with regular income ... for life.

 HEALTHCARE
This is a three-year health insurance plan, with life insurance benefit.

 NEW UG PREMIER
Upfront Allocation of 105% of single premium on day 1

 New UG SUPER
Highest allocation Up to 93% Guaranteed life cover

 NEW FAMILYGAIN
The only Unit linked insurance plan with ethical equity fund.

 SAFE CARE ECONOMY-SP

An investment that provides financial security and liquidity.

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 GROUP - PLANS

• GROUP CREDIT SHIELD

Available for Employer - Emplyee Groups
and Non Employer - Employee Groups

• GROUP TERM LIFE

Available for Employer - Emplyee Groups
and Non Employer - Employee Groups

• GROUP TERM LIFE SCHEME

in, lieu of EDLI (Employees Deposit Linked Insurance)

• GROUP GRATUITY CARE SCHEME

Giving your Employees and their families the heartening reassurance of your
care and financial security.

GROUP SUPERANNUATION SCHEME

34
Assure your Employees a financially secured, stable and independent post
retirement life.
Group Superannuation Scheme will be established under an irrevocable trust.
with trustees appointed by Company taking care of the administration.

• GROUP CREDIT SHIELD

Available for Employer - Employee Groups and Non Employer - Employee
Groups. This Scheme insures the loan amount outstanding in the account in case
of premature death or disability.

• GROUP TERM LIFE

Available for Employer - Employee Groups and Non Employer - Employee
Groups. This Scheme covers the members of an organization against the risk of
premature death of disability.

• GROUP TERM LIFE

in lieu of EDLI (Employee Deposit Linked Insurance Scheme)
This scheme is a better alternative to the Employees Deposit Linked Insurance
Scheme 1976 under Sec. 17(2) of the Employees Provident Fund and
Miscellaneous Provisions Act.

• GROUPS GRATUITY CARE

Giving your Employees and their families the heartening reassurance of your
care and financial security.
Group Gratuity Care is a Multi Featured Employee Welfare Scheme which
addresses your Gratuity liability with flexibility like never before.

35
 INSURANCE OF NRI's
You can now easily steer your savings from overseas to conveniently
meet your family's needs - now and in the future.

All Indians have an underlying need to feel secure, to care for the
loved ones and to provide for old age. The need is felt more when you are away
from your Homeland. But being away from India doesn't mean you have to
compromise on the safety and security of your loved ones.
In fact, you can now easily steer your savings from overseas to
conveniently meet your family's needs - now and in the future.
We at Bajaj Allianz understand your need. The need to do
something fruitful to your loved ones. The urge to let them know that your care.
That why we introduced the NRI insurance services. Now you can invest your
hard craned money in India and in the bargain ensure your family's future.

CARE SOLUTIONS FOR NRI's

Bajaj Allianz offers a large suit of products to cater every insurance
need that you have. care solutions includes:
1- Invest Gain - With Profits Endowment Plan.
36
2- Cash Gain - With Profits Money Back Plan.
3- Child Gain - With Profits Money Back Plan for Children.
4- Lifetime Care - With Profits
5- Swarna Vishranti – With Profits
6- Unit Gain - Unit Linked whole of Life Plan.

Who Can Apply ?

1- Foreign Nationals of Indian origin can propose for life insurance during
their stay in India only.
2- NRI's who are temporarily staying abroad can apply for insurance either
(a) During their stay in India or
(b) Through mail order business.
Convenient Premium Payment and Receipt Options
One can pay premiums directly through Indian currency cheques,
DD's etc.or directly from their FCNR/NRE account. The benefits under the
policy, as per current laws can be directly credited their FCNR/NRE account.
Premiums can also be paid through credit card during their visit to
Bajaj Allianz branch office. Alternatively standing instructions can be arranged
during the term of the policy.

37
 How does the plan
work?
The premiums paid are invested in the desired fund (based on the
allocation rate & units are allocated depending on the offer price of units for the
fund. The value of policy is the bid value of units that one hold in the fund. The
life insurance cover charges are deducted through monthly cancellation of unit
and the fund administration charge and fund management charge are priced in
the unit value.

Benefit Available under the

Plan
 Death Benefit :
In case of unfortunate, premature death, the beneficiaries are
entitled to the greater of :-
1- Sum assured less partial withdrawals.
2- The price of units.
3- One can choose a sum assured according to the need and the plan -

38
 Minimum sum assured - 5 times the annual premium.
 Maximum sum assured - 4 times the annual premium.
It will vary according to the plan eg. In Family Gain can be defined
as follows :-
Age 0-17 18-35 36-40 41-45 46-49 50-55 56-59 60-65
Group
4 30 60 50 40 20 15 10 5

Note :-
If age of the insured person is less than 7 or above 70 then the
value of units is payable only.

 Maturity Benefit :- On maturity, the value of the units is payable to the

life assured/policy holder.

 Additional Benefits :-
(a) Family income benefits
(b) Comprehensive Accident Protection
(i) Accidental Death Benefit
(ii) Accidental Total/Partial
(c) Critical illness benefit
(d) Hospital Cash Benefit
(e) Mahila Gain Raider Benefit
(f) Waiver of Premium Benefit

 Value Units :-
The unit Bid Price of each fund will be the unit value calculated
daily on a forward pricing basis.

39
 Market/Fair value of the investments of the fund plus
current assets less current liabilities and provisions
+/- Transaction Charges
Unit Value =
Number of outstanding units in the Fund
 Investment Options :
Bajaj Allianz offers you a choice of 6 funds. You can choose to
invest fully in any one fund or allocate your premiums into the various funds in
a proportion that suits your investment needs. All the funds will be managed by
asset managers of Bajaj Allianz, backed with the rich experience of Allianz Ag,
one of the largest aset managers in the world today, managing assets worth
more than Euro 989 billion (Rs. 49,84,560 Crores).

 Equity Fund - This fund provides the scope of high appreciation over a
long term. The fund will primarily invest in equities & is expected to
match returns given by NSE NIFTY. This fund will invest at least 90% in
equities and maximum 10% in cash.
 Equity Gain Fund - The investment objective of this fund is to provide
capital appreciation through investment select equity stocks that have the
potential for high capital appreciation. This fund will invest at least 85%
in equities and maximum 15% in debt & cash instruments.
 Equity MidCap Fund - The investment objective of this fund is to
acheive capital appreciation by investing in a diversified basket of mid
cap stocks and large cap stocks. The fund shall primarily invest in mid
cap stocks (at least 50% of the investment shall be in mid cap stocks).
Investment portfolio shall also include large cap stocks and cash with
cash not exceeding 20% of the portfolio value.

40
  Debt Fund - This fund provides the scope for steady returns at low risk
through investment in high quality fixed income securities. This fund will
be invested fully in debt instruments.
 Balanced Fund - The balanced fund is primarily for those who prefer a
mix through investment in high quality fixed income securities. This fund
will be invested fully in debt instruments.
 Cash Fund - The cash fund will invest conservatively in money market
& short-term investments to ensure that return on investments shall never
be negative. 100% of this fund will be invested in money market
instruments. The price of the units in this fund is guaranteed never to go
down.
These funds are professionally managed by asset managers of Bajaj
Allianz, backed with the rich experience of Allianz AG, one of the larget
asset managers in the world today, managing assets worth more than
Euro 996 billion (Rs. 53,64,456 Crores).

 Flexibility - to manage the investments:

We offer you the flexibility to manage your investments. Initially,
you can allocate the premium into the 6 funds that are available in a proportion
of your choice. Subsequently, depending on the performance of funds, you can
switch between funds and also change the allocation of premium to various
funds. We allow you three free switches every policy year subject to a minimum
switching amount of Rs. 5000 or the fund value, whichever is lower. You can
also change the proportion of premium allocation to various funds at each
policy anniversary.

Unmatched Flexibility - to suit your changing requirements

The Bajaj Allianz Unit Gain Plus offers you unmatched flexibility
to suit the policy according to your requirements.

41
 Flexibility - In premium payment : you have the flexibility to decide
how long you wish to pay the premiums and when you want to cash out
the policy benefits. You may choose to cash out the policy benefits at
one shot or do it as and when you require cash through partial surrender
of units.
 Flexibility - to increase the Sum Assured : You have the option to
increase the Sum Assure without any medical tests every 3rd year upto 4
times. The quantum of increase would be 25% of the original sum
assured or Rs. 1,00,000/- whichever is lower. If you do not exercise an
option when it is due, it cannot be carried forward. This benefit will be
available after age 18 and up to age 45. If the age is less than 18 at the
start of the policy, all 4 increments will be available from age 18. Apart
from exercising the options to increase the Sum Assured without
medical tests, you can increase the Sum Assured anytime, subject to
medical underwriting (available up to age 60). In either case, the sum
assured after

increase must be equal to or less than the maximum sum assured n

available for the premium level chosen.
 Flexibility - to Decrease the Sum Assured : You can decrease the
Sum Assured (in multiples of 1000) at any time to suit your changing
needs. The Sum Assured, after decrease, must be subject to
underwriting.
 Flexibilty - to pay top ups : You may have received a bonus or some
lumpsum money. You can use that to increase your investment in your
policy. 100% of any amount paid as top-up is allocated to your funds.
 Flexibility - to increase the level of Regular Premium Payment :
Your earnings grow over time, and so does your savings potential. With
Bajaj Allianz Unit Gain, you have the flexibility to increase your regular
premium amount at any time. The additional regular premium amount
42
 would be treated as a top-up for allocation, and therefore, 100% would
be allocated.
 Assured Protection - even if you miss payment of your
premiums: Bajaj Allianz Unit Gain provides you with the unique
feature of continued protection even if you forget to pay your premiums.
After payment of 3 full years premiums when premiums due are not
paid, the policy will stay in force with full benefits so long as there are
enough units available for charging the Cost of Insurance and additional
benefits (if selected) after deducting all applicable charges.

Premium Payment Mode :

For your convenience, we have provided 3 regular premium
payment modes that can be yearly, Half-yearly, and quarterly, we also offer a
monthly premium payment mode with salary deduction schemes. In addition,
you also have the option to pay top-ups to increase your investments.

Partial and Full Withdrawals:

Unit Gain offers you the full flexibility of full as well as partial
withdrawals by surrendering units, anytime after 3 full year premiums are paid.
The surrenders are paid out at the bid value of units, and there is no surrender
penalty on partial or full withdrawals after full 3 years premiums are paid. For
policy year 4 and above the company may impose surrender penalty of up to a
maximum of 10% of the bid value of units subject to approval of the IRDA.
Free Look Period:
Within 15 days from the date of receipt of the policy, you have the
option to review the terms and conditions and return the policy, if you are
disagree to any of the terms & conditions, stating the reasons for your
objections. You will be entitled to a refund, which will be the lower of :

43
  The premium paid less the Insurer's costs of issuing the Policy and the
Policy Documents (including but not limited to stamp fee charges and
any expenses incurred for medical examination), or
 The Value of Units, less the Insurer's costs of issuing the Policy and the
Policy Documents (including but not limited to stamp fee charges and
any expenses incurred for medical examination).
 Days of Grace :
Before the payment of full 3 years premiums must be paid when
due to keep the policy in-force. Till such time the company receives 3 full years
premiums, 30 days of grace will be allowed for the monthly mode.
 Revival of the Policy :
It is possible to revive a policy that has lapsed due to non-payment
of premiums or exhaustion of units within 5 years from such date of lapse. You
have to give a written application to the company to revive the policy with only
one full installment premium. The revival will be effected subject to
underwriting.

 Tax Benefits :
Contribution other than value of units cancelled for Critical illness
and Hospital Cash eligible for tax relief under Sec. 80(C) of IT Act, as of now.
Value of units cancelled for Critical illness and Hospital Cash
Benefit (including Top ups) is eligible for tax relief under Section 80(D).
Death Benefit and Withdrawals (partial of full) is tax free under
Section 10(10) D of the Income Tax Act, if the premiums paid (including top-
ups) in any year does not exceed 20% of the Sum Assured.
In case of charge in any tax laws relevant to the policyholder or the
fund performance, the same will be applied as per regulations prevailing at that
point of time.

44
  Nomination :
You can nominate your beneficiaries under this policy. In case of
an insured event occuring, the policy proceeds will be given to the nominee.
You can also change the nominee during the lifetime of the policy.

 General Exclusion :
In case the life assured commits suicide within one year of the date
of commencement of the policy, the amount payable would be the bid value of
units in the policyholder's unit account.

 Charges Under the Plan :

Given below are the details of the various charges that will be
recovered from the plan to meet expenses.
* Bid/Off spread : The bid-offer spread will be 5% of the Offer Price.
* Fund Administration and Fund Management Charge : Annual administrative
charges would be 1.25% per annum of net assets and annual investment charge
would be 1% per annum of net assets for the Equity Fund, Balanced, Debt &

Cash Fund, 1.5% per annum of net assets for the Equity Gain Fund and Equity
Mid Cap Fund, charged on a daily basis.
Transaction Charge : The transaction charge will be 0.5% but not exceed
0.7% of the equity investment. The transaction charge will be 0.1% but not
exceed 0.2% of the debt investments.
Switching Charges : Three free switches would be allowed every year.
Subsequent switches would be charged @ 1% of switch amount of Rs. 100,
whichever is higher.
Allocation : A portion of the premium paid will be charged towards expenses n
the initial years. Accordingly, the allocation to your fund will be 3% in year 1,
98% in year 2, 99% in year3 and 100% thereafter.

45
  Revision of Charges :
After taking due approval from the Insurance Regulatory and
Development Authority, the company reserves the right to change the following
charges :
 Fund management charge (up to a maximum of 1.75% per annum of the
net assets for the Equity Mid Cap Fund, Equity Gain Fund and upto a
maximum of 1.50% per annum of the net assets for the Equity Fund,
Balanced, Debt & Cash Fund.)
 Annunal administration charge (up to maximum of 2% per annum of the
net assets for each fund.)
 Modify the insurance charges (in respect of death, accident, critical
illness and hospital cash benefits) after a giving a notice of three months
to the policyholders and taking necessary approval from the IRDA.
 If the Proposer/Life Assured does not agree with the modified charges,
he/she will be allowed to exit the plan at the bed price of units.

 Risks of Investment in the Units of the Plan :

The proposer/Life Assured is aware that the investment in the
Units is subject to the following amongst other risks and agrees that he is
making the investment in the Units with full knowledge of the same.
 Bajaj Allianz Unit Gain is only the name of the policy and does not in
any way indicate the quality of the policy, its future prospects or returns.
 Equity Fund, Equity Mid Cap Fund, Equity Gain Fund, Balanced Fund,
Debt Fund and Cash Fund are the names of the funds offered currently
with Bajaj Allianz Unit Gain, and in any manner does not indicate the
quality of the respective funds, their future prospects or returns.

46
  The investments in the Units are subject to market and other risks and
there can be no asssurance that the objectivities of any of the funds will
be achieved.
 The price of units of each fund (expect the Cash Fund, where the unit
prices are guaranteed not to go down) can go up or down depending on
the factors and forces affecting the financial and debt markets from time
to time and may also be affected by changes in the general level of
interest rates.
 The Equity Index, Equity Mid Cap, Equity Gain, Debt and Balanced fund
do not offer a guaranteed or assured return.
 All benefits payable under the Policy are subject to the tax laws and other
financial enactments, as they exist from time to time.
 The past performance of other funds of the company is not necessarily
indicative of the future performance of any of these funds.

Why Bajaj Allianz life Insurance?

Bajaj Allianz Life Insurance Company Limited is a union between
Allianz AG, the world's leading insurer and Bajaj Auto, one of India's most
respected names, Allianz AG is a leading insurance conglomerate globally and

the largest asset manager in the world, managing assets worth over 989 billion
Euros (Rs. 49,84,560 Crores). At Bajaj Allianz, we realize that you seek an
insurer you can trust your hard earned money with. Allianz AG has more than
110 years of financial experience in over 70 countries and Bajaj Auto, trusted
for over 55 years in the Indian market, are committed to offering you financial
solutions that provide all the security you need for your family and yourself.
All Bajaj Allianz, customer delight is our guiding principle.
Ensuring world class solutions by offering you customized products with
transparent benefits supported by the best technology is our business
philosophy.
47
  Apportionment of Investment :
You can apportion the investible amount between various funds
available. The apportionment to any fund must be at least 5% of the investible
amount. At any policy anniversary, you also have the flexibility to change the
apportionment to the funds.
 Termination of the Policy :
The policy will terminate on occurrence of any one of the
following :
a) The units in the policy are fully surrendered.
b) The account value becomes less than the minimum amount to be
maintained.
c) The account value is not sufficient to support the Cost of Insurance and
other charges.
d) The death of the Life Assured.
e) On maturity.
On the occurrence of (a), (b) and (c) above the value of the units, if
any would be paid to the life assured/policyholder upon such termination,
subject to surrender penalty, if applicable. In case of (d), death benefit will be as

mentioned separately herein, in case of (e), the values of units, if any is paid to
life assured/policyholder on maturity.
 Additional Protection for you and your family
You have the option to add the following additional benefits,
providing total protection against uncertainties.
a) Family Income Benefit (FIB) - The Ultimate Protection - For Your
Loved Ones
You can select the unique Family Income Benefit from Bajaj
Allianz that ensures total financial protection for your loved ones. In case
of death or accidental total permanent disability, a guaranteed monthly
48
 income of 1% of the sum assured (12% per annum) is paid till the end of
the policy term or at least for a period of 10 years, whichever is higher.
Moreover, all future premiums are waived.
b) Comprehensive Accident Protection
This benefit provides comprehensive cover in case of an accident.
It comprises of :
Accidental Death Benefit
Accidents are always sudden and sometimes fatal. Yu can't lessen
the emotional shock, but you can certainly soften the financial one. Bajaj
Accidental Death Benefit gives the loved ones something to start with
after the permanent loss of income by paying an amount equal to the Sum
Assured. (Subject to a maximum of Rs. 50,00,000/- under all policies
with Bajaj Allianz taken together.)
Accidental Permanent Total/Partial Disability Benefit
Accidents are unpredictable, and so are the consequences. They
may lead to a disability - partial or total. This Benefit provides a financial
cushion against such misfortunes. You will get 50% of the Sum Assured
in case of partial disability and 100% in case of total disability.

Waiver of Premium Benefit

An accident may lead to permanent total disability, limiting one's
ability to earn. Bajaj Allianz waiver of Premium benefit is a helping hand
when one needs it most. It waives off all future premiums while keeping
the valuable life insurance cover alive, thus enabling you to live up to
your commitments.
c) Critical Illness Benefit (CI)
Some illnesses are critical. They not only alter one's life's
pattern but also result in a financial drain. Bajaj Allianz Critical illness
Benefit softens the impact on the family by paying out the Critical Illness

49
 Benefit under the plan immediately, while other policy benefits continue
(excluding Hospital Cash Benefit).
d) Hospital Cash Benefit (HC)
The worry of settling hospital bills (room charges) adds to
the trauma of hospitalization. Bajaj Allianz Hospital Cash Benefit
reduces this financial burden and helps recovery with peace of mind.

MANAGEMENT REPORT
With respect to operation of the Bajaj Allianz General Insurance
Company Ltd. For the year ended 31 March 2005 and result thereof, the
management of the co confirms and declares that;
1. The registration certificate granted by insurance regulatory and
development authority (IRDA) is valid and the same has been renewed
for the year 2005-2006.

50
2. We certified all dues payable to the statutory authorities have been duly
paid.

3. There was no transfer of share during the year and the shareholding
patterns is in accordance with the statutory and regulatory requirement.

4. The management has not invested any fund of shareholders of policies in

India directly or indirectly in India.

5. The required solvency margin have been maintained as required by IRDA

6. We certified that the values of all assets have been renewed on the date of
balance sheet and in management’s belief; the assets set forth in the
balance sheet are in the aggregate amount not exceeding their realizable
or market value.

7. The company has a spread portfolio and the few large risk on its book are
well protected by re-insurance. The company has entered in to re-
insurance arrangements where in it reinsures risk in excess of retention

limit. The companies gross acceptance of protected by surplus treaties

with sufficient capacities and the net accounts are protected by both risk
and catastrophe excess of loss treaties.

8. The companies does not have operation in any other country.

9. The company has completed about 3 year of operation and from the
experience this far it can be stated that the average time taken for
settlement for claims in excess of branch limits is approximately 3 to 4
weeks from the date of receipt of final documents in case of

51
 miscellaneous class of business and 4 to 6 weeks for other than
miscellaneous class of business. This however does not include motor
third party claim which have to setteled through the MACT and other
judicial bodies.

10. We certified that the values, as shown in balance sheet of the investment
which consist of the fixed income securities, equity shares and the mutual
fund that have been valued as per accounting policies prescribed by
IRDA. Market values have been ascertained on the basis of traded prices
on the national stock exchange of India Ltd. and where such prices were
not available, based on valuation procedure issued by fixed income and
money market, and derivative dealers association (FIMMDA). The invest
in the mutual fund are valued at the net asset value (NAV) of these
mutual funds as on the balance data.

11. The company has invested mainly in approved government securities and
AAA or AA+ rated bond. The primary while investing is to generate
adequate while minimizing risk. The emphasis is also on the liquidity of

investments to insure the company meets all out going related to claim
and other operation, While most of the investment are in fixed income
securities in the form of government of India securities or corporate
bonds with stron credit rating, a small portion is also invested in non
fixed income securities in equity mutual fund and equity shares. None of
the fixed income investments have had any delays in servicing of interest
or principal amount based on the past track record, the management is
confident of the quality and performance of the investment.

52
12. The management of Bajaj Allianz General Insurance Company Limited
certifies that the banquet of innovative product that have been launched
include MTPO. Ports & terminal liability package, jewelers block,
housing loan cover for loance on being jobless and the film and the event
insurance.
Talking of events Femina Miss India Zee Cine Award, Product
launches etc. were insured by Bajaj Allianz.
To enhanced the functioning of our vast it infrastructure that
provide access of our web based system a new server (IBMP670) has been
installed and long with its DRS (disaster recovery site) at Hydrabad at has also
been set up.
Over 900 people comprising staff and intermediaries can now
access the system from various location to issues policies without experiencing
slowing down processing.
IRDA approved banc assurance distribution channel has tied up
with Karnataka bank, Saraswati Bank and shamrao Vitthal Co-operative Bank
to further widen the client base.
Rejuvenating agency channels with a view to expanding the
business. The company has ensured proper support systems such as trainees,
managers that and in keeping agency mergers in place.

Reinsurance agreements/treaties such as quota share, surplus. Excess of

loss have significantly increased underwriting capacity to INR500 Mio for
property risks. from an expiring INR 12000 Mio in quota share type of

insurance the insurer agrees to accept apreagreed percentage of all risk written
by the company which is use to apportion the liability preminmand claims in
surplus type of reinsurance the direct under write retains all liability up to a
agreed amount the insurer only.

53
 Share in the amount in excess of such retention under excess of
loss type of insurance the insurer aggress to retain losses up to a agreed amount
and the reinsurer picks up the amount in excess of the retain losses.
These are the some of the measures under taken by Bajaj Allianz to
protect their underwritten risks and to provide protection. These have also led to
maximize underwriting capacity for Bajaj Allianz.

Up date on Reinsurance Front :

(a) The financial statement of BajajAllianz General Insurance Co. Ltd. Have
been prepared in accordance with the applicable accounting standard and
principal policies with no material departure.
(b) The management has adopted accounting policies and applied them
consistently and made judgements and estimates that are reasonable and
prudent some to give a true and falt view of the state of the affairs of the
company at the end of the financial year and of the operating profit and of
the profit of the company for the year.
(c) The management has taken proper and sufficient care for the maintenance
of adequate accounting records in accordance with the applicable
provisions of the insurance Act. 1938 (4 of 1938) and companies Act
1956 ( 1 of 1956) for safeguarding the assets of the company and for
preventing and detecting fraud and other irregularities.

(d) The financial statements have been prepared on a going concern basis.
(e) The management has set up an internal audit system commensurate with
the size and nature of the business and the same was operational
througout the year.

13. The schedule of payments which have been made to individuals firms
companies and organization in which the directors of the insurer are
interested are as follows :
54
 Salary and expenses of CFO on deputation from Bajaj Auto Ltd.
3,395,000 Rent and deposit for premises on lease from Bajaj Auto Ltd.
14,802,367 other services. Bajaj Auto Ltd. Rs. 1, 531, 805
for and on behalf of the board of directors
Sanjay Bajaj
Kamesh Goyal
Director
Chief Executive Officer
Rahul Bajaj
Don Nguyen
G. B. Laddha
Chairman
Director
Chief Financial Officer
Heinz Dollberg
Ranjit Gupta
S. Venkatesh
Director
Director
Company Secretary

55
 FINANCIAL

Key Achievements in FY 2005-06 :

• No. 1 Pvt. Life Insurer FY 2005-06. Leading by Rs. 78 Cr.
• No. 1 Pvt. Life Insurer in Retail Business. Leading by Rs. 339 Cr.
• Whopping growth of 216% for th FY 2005-06
• Have sold over 13,00,000 policies to satisfied customers
• Is backed by a network of 550 offices spanning the country
• Accelerated Growth

56
 Fiscal Year No. of policies sold in FY GWP in FY
2001-2002(6 mths) 21,376 Rs. 7 Cr.
2002-2003 1,15,965 Rs. 69 Cr.
2003-2004 1,86,443 Rs. 221 Cr.
2004-2005 2,88,189 Rs. 1002 Cr.
2005-2006 7,81,685 Rs. 3134 Cr.

• Assets under management Rs. 3,324 Cr.

• Shareholder capital base of Rs. 500 Crores
Key Achievements
 Number 1 in terms of new business premium amongst the private insurs
for FY 2005-2006
 Gross premium achieved over Rs. 3130 crores
 Number of offices over 560, number of STMs over 6050 and number of
Ics over 109,000
 Number of MDRTs 517, COTs 36 and TOTs 7
 Number of Cooperative banks and RRBs tied up withover 25
 Intermediaries actively working with us - franchisees 884; Corporate
agents 130 ; and closed over 200 Group schemes
 A full basket of products approved

Financial Highlights Year 2005-06

Particulars 2005-06 2004-05 2003-04 2002-03 2001-02

Rs. Million Rs. Million Rs. Million Rs. Million (11 Months)
Rs. Million
Gross written Premium 12846 8560.7 4798 2998 1420
Net written Premium 6987 4792.9 2864 1808 841
Net Earned Premium 5864 3709.2 2306 1541 98
Net Incurred Claims (4100) (2263.3) (1542) (1072) (127)
Net Commissions 622 419.4 231 155 128
Management Expenses (2156) (1455.9) (984) 689 (370)
Underwriting Results 230 409.4 11 (33) (271)
Income from Investments 520 388.8 285 207 143
Others 68 28.6 22 (3) (5)
Profit Before Tax 818 769.6 318 171 (133)
Provision for Tax (303) (298.7) (101) (75) 37
57
Profit After Tax 516 470.9 217 96 (96)
Claim's Ratio 70% 61% 67% 70% 130%
Commission Ratio 11% -11% -10% -10% -130%
Management Expenses Ratio 37% 40% 42% 43% 376%
Combined Ratio 96% 90% 99% 102% 376%
Return on Equity 23% 34% 20% 9% -9%
Shareholder's Equity 2767 1824.1 1380 1095 997
Assets Under Management 7580 5835.5 3486 2709 1688
Number of Employees 1371 924 480 306 141

COMPETITORS' PERFORMANCE

1 YEAR RETURN CASH DEBT LARGE CAP MID CAP

EQUITY EQUITY
BAJAJ UG PLUS 4.75% 3.83% 72.51% 76.80%
Median Returns by 4.75% 3.55% 60.21% 63.03%
Insurance Cos.

CLAIMS REPORT FOR THE FINANCIAL YEAR 2005-2006

MAIN ACCIDENT
CONTRACTS BENEFIT
TOTAL TOTAL
GROSS GROSS
BENEFIT BENEFIT
AMOUNT AMOUNT

58
 NO. (Rs. In Lakhs) NO. (Rs. In Lakhs)
1 Claims O/s at start 148 226.29 10 19.14
2 Claims 1556 2048.46 69 131.51
Intimated/Booked
3 Claims Settled 1004 1065.75 41 60.82
4 Claims repudiated 159 469.75 14 60.04
5 Claims O/s at end 441 739.49 24 29.79

Objectives for 2006-07

 To be one of the top private file insurers in terms of new business
premium and profitability
 Achieve a minimum premium target of Rs. 8500 crores (with less
than 30% Single premium)
 Improve service at all levels operations/finance/IT
Ensure we retain our staff who are our key resource

SOME OF THE AREAS WHERE WE COULD HAVE

IMPROVED
 Did not achieve our premium target of Rs. 3500 crores with less than
30% single premium, however growth in the last year is over 212%
 Customer service levels have yet to improve, we will focus on this in the
current year.
THE KEY INITATIVES THE COMPANY PLANS TO TAKE IN
THE FIRST QUARTER OF 2006-07 INCLUDE:
 Increasing Branch and Satellite numbers to 650
59
 Increase STM strength to 7000 and IC strength to 125,000
 Products for filing & approval revised ULIP products; pension plan;
ULIP with Guarantee; micro insurance products
 Target 5 banks/Cooperative banks for tie up.
 Increase Franchisee to 1000 and Corporate agents tie up to 150
 Increase in Group clients by 50 in this quarter and Brokers start working
at least 50
 NRI business from UAE Exchange and tie up with UAE bank
 Online system to go live for switches and withdrawals
 Finalization of Accounts for 2005/06
 Appraisals/ variable pay / salary increases / bonus pay outs

INSURANCE INDUSTRY
Indian Insurance Sector:-
History of Indian Insurance Market
Insurance in India goes back to the time of the British. The first life
insurance company to operate in India the Oriental Life Insurance Company to
operate in India - the Oriental Life Insurance Company was established in 1818
in Calcutta. It was, however, a British Company. The first Indian insurance
company, the Bombay Mutual Life Assurance Society started its operations in
1871. In 1956 the Indian life insurance industry was made up of 154 domestic
life insurers, 16 foreign life insures and 75 provident funds, and was still
governed by the Insurance Act of 1938. In 1956 all life insurance companies
were nationalized. At present the Insurance Regulatory and Development
Authority (IRDA) has issued licenses to the 14 Private Life Insurance
Companies…

60
Insurance Regulator :-
Insurance Regulatory & Development Authority (IRDA) Laws
Governing Insurance IRDA Act 1999 Insurance Act. 1938 and subsequent
amendments Companies Act 1956 Licensing Requirements For Insurance
Companies. The minimum capital requirement for direct non- life and life
insurance business in INR 1,000 million and for reinsurance companies, INR
2,000 million. The IRDA regulates the entry and exit of players, capital norms
and maintains a strict watch on the equity and solvency situation of insurers
insurance Braking the IRDA regulates the brokers operating in the market.
Licenses to brokers are issued after scrutiny of capital availability, infra -
structure, manpower and people responsible for operations. Brokers are
required to maintain and submit periodical returns to the stipulated authority

and are subject to audit by the relevant authorities. The regulations clearly

61
define the function of insurance and reinsurance brokers. They lay down a code
of conduct for intermediaries. Brokers' regulation stipulate any business that is
routed through brokers. Can only be routed through brokers, can only be routed
through brokers registered in India Brokers soliciting business need to undergo
training and pass the required examinations. They are also obligated to purchase
professional indemnity insurance at three times its revenue or for a minimum of
its capital.

WINDS OF CHANGE:-

Reforms have marked the entry of many of the global insurance

majors into the Indian market in the form of joint ventures with Indian
companies.

Some of the key names are AIG, New York Life, I Allianz,
Prudential, Standard Life, Sun Life Canada and old Mutual. The entry of new
players has rejuvenated the erstwhile monopoly player L1C, which has
responded to the competition in an admirable fashion by launching new
products and improving service standards. The following are the key winds of
change about by privatization.

Market Expansion:-

There has been an overall expansion in the market. This has been
possible due to improved awareness levels thanks to the large number of
advertising campaigns launched by all the players. The scope for expansion is
still unlimited as virtually all the players are concentrating on large cities and
towns- except by L1C to an extent there was no significant attempt to tap
therural markets.
62
New Product Offerings :-

There has been a plethora of new and innovative products offered by the
new players, mainly from the stable of their international partners. Customers
have tremendous choice from a large variety of products from pure term (risk)
insurance to unit- linked investment products. Customers are offered unbundled
products with a variety of benefits as riders from which they can choose more
customers are buying products and services based on their true needs and not
just traditional money- back policies, which is not considered very appropriate
for long- term protection and savings. However,

Customer Service :-

Not unexpectedly, this was one area that witnessed the most
significant change with the entry of new players. There is an attempt to bring in
international best practices in service and operational efficiency through use of
latest technologies. Advice and need based selling is emerging through much
better trained sales force and advisors. There is improvement in response and
turnaround times in specific areas such as delivery of first policy receipt, policy
document, premium notice, final maturity payment, settlement of claims etc.
However, there is a long way to go and various customer surveys indicate that
the standards are still below customer expectation levels.

Channels of Distribution :-
Till two years back, the only mode of distribution of life insurance
products was through Agents. While agents continue to be the redominant
distribution channel, today a number of invocative alternative channels are
63
being offered to consumers. Some of them are banc assurance, brokers, the

internet and direct marketing through it is too early to predict, the wide spread
of bank branch network in India could lead to banc assurance emerging as a
significant distribution mechanism.

DISTRIBUTION CHANNELS IN THE

INSURANCESECTOR

India is a vastly under insured country 1I1 the world I t is at the 1 th8 position
among life insurance markets and 28th in non life Insurance markets in the
world. This indicates that there is a vast untapped market particularly for

insurance products. For instance, when India had started opening up this

sectorin J 999 premium as a percentage of gross domestic products was a mere

1 .3 9 %as against 7% of U.S., 8.87% of Japan and 10.30% of U k. Thro ugh the

same has improved to 2.7% in 2003, it is far less as compared to many other

countries. In other words, there is a huge potential that has not yet been

explored. Penetration of life insurance in India is as low as 2.7% of the GDP. To

tap this rich market potential, private insurers are concentrating on product

innovation, managing investments, and customer's service, expense control and

in particular distribution channels. In fact, multi channel distribution and

marketing of insurance products have been the strategy of new players in the

Indian Insurance Market. The various distribution channels in the Insurance

sectors are:-

64
 Direct marketing channels

 Agents

 Brokers

 Third Parties

 Corporate Agents

 Bancassurance

 Internet

DIRECT MARKETING CHANNELS

Direct marketing channel or zero-level channel consists of a company

selling directly to the final customer. In other words, service providers are more

likely to visit corporate customers at their premises than to visit individual in

their homes, reflecting the larger volume associated with business-to-business

Transactions. LIC has adopted the direct marketing approach to develop

the group assurance market. As such it has succeeded in keeping the cost ratios

under group policies at very low levels. Private insurers are also engaging in

direct marketing to high net worth individuals through channels like - work site

marketing.. a relatively inexpensive and easy launch potential distribution

65
channel.

AGENTS

These people do not take title to goods and service and perform only a

few functions. These people are not on the rolls of the company and work as

agents between the insurance company and the customer. Their main function is

to facilitate buying and selling for which they earn a commission on the selling

price. Generally they specialize by product line or customer type The role of

Agent today is becoming more and more important. He is no longer looked

upon as simply an agent but also seen as 3 financial adviser. Agent generated

sales of insurance products are predicted to grow by $ 11 billion over the next

five years especially within the high net worth market. Through SBI life and

Aviva India have successfully' sold their products through the bancassurance

channel, they both feel the need to extend their distribution sales and focus on

the agency force. LIC, the monolithic organization has an agency force of

9,02,199 during 2002-03 and the productivity of each active agent stands at Rs.

19,51,767.In case of ICICI Prudential Life too. 70% of its business in the

financial year 2004 came through direct agency force. This shows that agency

force has immense potential due to the fact that many of the insurance products

are highly complex and the selling of the complex require greater knowledge

66
and understanding.

BROKERS

Brokers are like agents, but with a difference while agents get the

license to sell policies of only one life insurance company and one non-life

insurance company at a time. Brokers are like consultants who analyze a client's

needs and provide solutions. There are around 165 brokers in the country and

they earn as much as 12% commission. But they are found to be passing on a

certain percentage of their commission to policyholders to attract business. It is

to be worth mentioned that provisions of section 41 of the Insurance Act, 1938

prohibits the offer of any direct or indirect inducement including rebating to

procure insurance business. Towards this end, the IRDA started taking action

on brokers including in rebating and has called for submission of detailed

returns from brokers relating to their activities. The brokers are expected to

submit monthly statements brokerage received and payments made out of this

brokerage on a continuous basis.

THIRD PARTIES
Distribution through third partIes means that it is those companies rather

than the insurers who often reap the benefits of customer loyality. This

accelerated the shift of insurance to a commodity product. It is a fact that

private insurance companies are relying heavily on third parties like Post

67
offices, Car dealers, Super markets, Travel agencies including Sugar co-

operatives. Trade unions, Micro finance in agencies and even welfare

organizations like Help Age. In fact, private insurance companies have left no

stone unconcerned. For instance, met life India has tied up with Mumbai's

Apna Bazar Co-operative stores chain. The city's largest supermarket chain

now hawks the insurers wares to its customer base of over 1.5 million in the

metropolis and beyond. All the same, Oriental insurance company has tied up

with Department of Post to sell its products. The postman now not only delivers

the mail but also sell insurance products.

CORPORATE AGENTS

This involves tic-ups with non-banking finance companies to act as

corporate agents. This enables insurance to ross sell with other financial

services. The corporate agency system works a lot like - Brokers except for the

fact that they are restricted for selling a single insurer's products. These are

more than 1000 corporate agents in the country. In reality, Corporate agents

have been able to get the better deals from the insurers and they actually earn

more than the brokers in some businesses. The insurance sector needs to

develop alternative distribution channels, as it is not a viable channel for

insurers.

BANCASSURANCE
68
 Bancassurance symbolizes the convergence of banking and insurance.

The term involves distribution of insurance products through a bank's branch

network. In concrete terms, bancassurance. Which is also known as Allianz-

describes a package of financial services that can fulfill both banking and

insurance needs at the same time. While Bancassurance has become a success

story in Europe, it is relatively a new concept in Asia. For instance,

Bancassurance represents over 65% of the premium income in life insurance in

Spain, 60% in France,50% in Belgium and Italy. Bancassurancc penetration is

expected to substantially increase in Asia over the next five years. Potentially

accounting for 13% of life insurance premiums. A key factor driving the

development of bancassurance in Asia in the relaxation of stringent regulations.

Markets where bancassurance was previously prohibited, including Japan, South

Korea and Philippines are taking a more accommodating stance towards bank

distribution of insurance products. Bancassurance as a means of distribution of

increase products is already in force in India in some form or the other. Banks

are selling personal accident and. baggage insurance directly to their customers

as a value addition to their products. Banks are also participating in the

distribution of mortgage linked insurance products like fire, motor or cattle

insurance to their customers. The growth of bancassurance by allowing the use

of multiple distribution channels by banks and insurance companies.

69
 BENEFITS OF BANCASSURANCE

lnsurance companies see bancassurance as a tool for increasing their market

penetration and premium turnover. The customer sees bancassurance as a

bonanza in term of reduced price, high quality product & delivery at doorsteps.

Banks and Insurance companies have complementary strengths. In their natural

and traditional roles and with their current skills, neither banks nor insurance

companies could effectively mount a bancassurance start-up alone.

Collaboration is the kev to making this new channel work. Expenses ratio in

insurance activities through bancassurance is very low. Banks and the

insurance companies benefit from the same distribution channels and people.

OBSTACLES

The most common obstacles to success are poor human resource

management, lack of sales culture within the bank, no involvement by the

branch manager, insufficient product promotions, failure to integrate marketing

plans, marginal database expertise, poor sales channel linkages, inadequate

incentives, resistance to change, negative attitudes towards insurance and

unwidely marketing strategy.

INTERNET

70
 As a distribution channel the Internet facilitates information flow,

negotiations flow, service flow, transaction flow and promotion flow Compared

to the traditional channels, the net is definitely better for conducting research on

consumer information seeking and search behaviors, for getting feed back from

consumers in a short period of time and for creatIng communities online.

Internet sales will experience explosive growth. This is due to the fact that for

every $ 100 in first year premiums collected by Insurance company about $ 139

is spent on Agents in the form of commission and other overhead expenses in

the U.S. The same policy sold over the Internet would cost just a fraction of the

cost at about $ 15 for every $ 100 earned in premium. Due to its low cost,

almost all the inurnce companies in India resorted to Internet initiatives. The

future use of interest as a distribution channel is likely to be driven more by the

insurance industry and its technology suppliers than by counsumers themselves.

Having realized the importance of Internet as a distribution channel. LIC put all

the information in the internet. The intermediaries in the insurance sectro and

the distribution channels used by the companies will perhaps be the strongest

drivers of growth in the sector. Multichannel distribution and marketing of

insurance products will be the smart strategy for the Indian insurance market.

STRATEGIC ALTERNATIVES:-

It one analyses the history of growth of the insurance industry since

reforms; it is marked by all-round growth of all players. More or less all players
71
(including the market leader Lie) have aggressively recruited and trained

advisors, appointed agents, launched new products, improved customer service

standards and revamped/ expanded their distribution networks. If at all there was

any major difference between players it was only in time lag in launching of

services. Every player would like the customers to believe that its service

standards are the best of that its agents are the most informed and ethical, but is

debatable whether there are any significant differences. In other words, each

company is trying to be everything to everybody' our argument is that the

strategy of being everything to everybody is risky. Some players justify the

above strategy on the basis that the Indian market is huge and it can

accommodate everybody. Still, in a market where it is difficult to distinguish

oneself sufficiently on service or any other parameter to be able to charge a

premium, it will lead to unmitigated price competition to the detriment of all

players. One may achieve sales turnover, but margins and profitability will

suffer severely. In the insurance industry where large amounts of capital are

required, this is risky. While there is room for a few scale players with a finger

in every pie, it is profitable for other players to focus on different segments to

survive and thrive in a multi-firm open environment. While each company has

to choose its own unique positioning based on its unique strengths, the below-

mentioned generic positioning alternatives appear worth considering. Needless

to say the positioning choices discussed here are not mutually exclusive and can

be overlapping.

72
Variety Based Positioning :-

This type of positioning is based on varieties in products and services

rather than customer segments. It is a sensible strategy for those companies

who have distinctive advantages or strengths in offering certain products and

services. In the insurance industry too, it is possible to achieve a unique

position by focusing on certain category of products. One such example is Birla

Sun life insurance, which has been placing particular focus on investment-

related products since its launch in India. Through its superior fund

management capabilities, the insurance company can deliver better returns on

its investment- linked products and thereby carve for itself a leadership position

in this segment. Then there is the entire category of pension products which is

widely touted to have immense growth potential in India due to imminent

pension reforms. It is possible to achieve profitable positioning by focusing and

excelling in only pension products.

Need Based Positioning :-

This is the most commonly understood positioning and is based on the

differing needs of different group of consumers. This can be done successfully

if a company has unique strengths to service a group of customer needs better

than others. The insurance needs of customers vary significantly for different

groups of customer. The insurance needs of young family with small children

73
will be quite different from that of a family in which the income earner is close

to retirement. However, in India most of the life insurance companies have a

wide variety of products tailored for different customer needs and there is no

company focusing on a particular customer need. An example would be a life

insurance company that focuses only on High Net worth Individuals (HNls).

The needs of HNls would be quite different from those of a general consumer

and would require an entirely different marketing mix right from the type of

products offered and the way they are distributed, to the promotion methods

employed

Access- based Positioning :- Positioning of customers can also be done

by the way they are accessible That is different groups of customers may be

accessible in different ways even though may have similar needs. Access is

typically a function of customer scale. There is excellent opportunity in the

insurance industry to employ access- based positioning by targeting the rural

insurance sector. The rural market for life insurance is very different from the

urban market in terms of needs, income levels and distribution (seasonality, for

example), penetration of media and so on, So far except for L1C, no other

player has paid any attention or focus on the rural sector. Contrary to common

perception if one if able to carefully plan and tailor an entire set of low-cost

activities of advertising, distribution, and product design etc. to successfully

exploit the potential.

74
of Life
IndiaInsurance
(LIC) :- Corporation
Life Insurance Corporation of India (L1C) was formed in September,

1956 by an Act of Parliament, viz, Life Insurance Corporation Act, 1956, with

capital contribution from the Government of India. The then Finance Minister,

Shri C.D. Deshmukh, while piloting the bill outlined the objectives of L1C thus:

to conduct the business with the utmost economy, in a spirit of trusteeship; to

charge premium no higher than warranted by strict actuarial considerations; to

invest the funds for obtaining maximum yield for the policy holders consistent

with safety of the capital; to render prompt and efficient service to policy

holders, thereby making insurance widely popular.

Since nationalization, L1C has built up a vast network of 2,048 branches,

100 divisions and 7 zonal offices spread over the country. The life insurance

corporation of India also transacts business abroad and has offices in Fiji,

Mauritius and United Kingdom. L1C is associated with joint ventures abroad in

the field of insurance, namely, Ken-India Assurance company Limited, Nairobi;

United Oriental Assurance Company limited, Kuala Lumpur and life Insurance

Corporation (International) E.C. Bahrain. The Corporation has registered a joint

venture company in 26[11 December 2000 in Katmandu, Nepal by the name of

life Insurance corporation (Nepal) Limited in collaboration with Vishal group

Limited, a local industrial group. An off-shore company. L.I.C (Mauritius) off -

75
Shore Limited has also been set up in 2001 to tap the African insurance market.

Life Insurance:-

Life insurance is a form of insurance that pays monetary proceeds upon

the death of the insured covered in the policy. Essentially a life insurance policy

is a contract between the named insured and the insurance company wherein the

Insurance company agrees to pay and agreed upon sum of money to the

insured's named beneficiary so long as the insured's premiums are current.

People take out life insurance policies for a number of reasons. Such

insurance provides security to family members upon the loss of a loved one. For

instance, if the primary wage earner dies in his or her prime, the death benefit

received form a life insurance policy will assist the surviving family members

in overcoming the burden of the tragic loss. Life insurance can be purchased by

individuals, but is also offered as a perk by many employers. Often times, large

employers and government employers offer group life insurance at no cost to

the employee. Should the employee wish to obtain additional life insurance

form the employer's insurance company, they can usually do so at reduced

rates.

The cost of life insurance varies depending on such factors as the

insured's age, health, and occupation. For example, the premium for a 25year -

old, male, non-smoker in excellent health will be far less expensive than a

similar policy for a 65- year old male smoker. Similarly, a sky dive instructor
76
would have to pay much higher premiums for life insurance than would a

librarian.

Life insurance is available in a number of different forms to fit the tastes

of the proposed insured. Some of the typical forms of life insurance policies

include: whole life, variable life, and term life, Term life insurance policies

begin with low premiums during the initial stages of the policy and these

premiums increase steadily as the insured grows older. There is no cash build-

up in a term policy and, accordingly, the death will not increase.

With whole life and variable life insurance, a portion of each premium

pays for the insurance and the remainder serves as a tax-free investment. A

whole life policy sets a premium at the beginning of the policy and that

premium does not change over the life of the policy. This form of insurance

allows for a cash build-up during the insured's life. This cash build-up can be

used during the course of the policy or it will simply serve to increase the death

benefit in the end.

In a variable life product, the premium remains the same over the life of

the policy, and there should be a cash build- up as long as the various mutual

funds selected by the insured perform well.

Protection of the interest of policy holders:-

IRDA has the responsibility of protecting the interest of insurance

policyholders. Towards achieving this objective, the Authority has taken the

77
following steps:-

* IRDA has notified protection of Policyholders Interest Regulations 2001

to provide for policy proposal documents in easily understandable

language; claims and policyholders servicing. The Regulation also

provides for payment of interest by insurers for the delay in settlement of

claim.

* The insurers are required to maintain solvency margins so that they are in a

position to meet their obligations towards policyholders regard to

payment of claims.

* It is obligatory on the part of the insurance companies to disclose clearly the

benefits, terms and conditions under the policy. The advertisements

issued by the insurers should not mislead the insuring public.

* All insurers are required to set up proper grievance redress machinery in

their heard office and at their other officer.

* The Authority takes up with the insurers any complaint received from the

policy holders in connection with services provided by them under the

insurance contract.

Life Insurance Market :-

The Life Insurance market in India is an underdeveloped market that was

only tapped by the state owned Lie till the entry of private insurers. The

penetration of life insurance products was 19 percent of the total 400 million of

the insurable population. The state. Owned L1C sold insurance as a tax
78
instrument, not as a product giving protection. Most customers were under

insured with no flexibility or transparency in the products. With the entry of the

private insurers the rules of the game have changed.

The 14 private insurers in the life insurance market have already grabbed

nearly 9 percent of the market in terms of premium income. The new business

premiums of the 14 private players have increased more than Rs. 1000 crore in

last year. Meanwhile, state owned L1C's new premium business has fallen.

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

79
life insurance policy before privatization was around Rs 50,000. That has risen

to about Rs. 80,000. But the private insurers are ahead in this game and the

average size of their policies is around Rs. 1.1 lakh to Rs. 1.2 lakh. Which is

very bigger than the industry average.

Why do we need Life

Insurance?
Isn't that what we ask ourself all the time? Here's a small answer to

that we need Life Insurance because typically the need for income continues for

those who are financially dependent on us but there is no guarantee of ability to

earn consistently and for the rest of our life. Life insurence can help us

safeguard the financial needs of our family.

This need has become even more important due to steady

disintegration of the prevalent joint family system, and emergence of nuclear

80
families. The need to protect our family's ever growing needs is why we need

Life Insurance.

Why Bajaj Allianz Life Insurance?

Bajaj Allianz Life Insurance Company Limited is a union between

Allianz AG, the world's leading insurer and Bajaj Auto, one of India's most

respected names. Allianz AG is a leading insurance conglomerate globally and

the largest asset manager in the world, managing assets worth over a Trillion

Euros (Rs. 58,92,000 Crores). At Bajaj Allianz, we realize that you seek an

insurer you can trust your hard earned money with. Allianz AG has more than

110 years of financial experience in over 70 countries and Bajaj Auto, trusted

for over 55 years in the Indian market, are committed to offering you financial

solutions that provide all the security you need for your family and yourself.

81
 At Bajaj Allianz, customer delight is our guiding principle.

Ensuring world class solutions by offering you customized products with

transparent benefits supported by the best technology is our business

philosophy.

DATA ANALYSIS
82
 &
INTERPRETATION

DATA ANALYSIS AND INTERPRETAION

Q.1. Do you know about Life Insurance?

YES : 99%
NO : 1%

83
 According to the awareness about
Life Insurance

1%

Yes
No

99%

Interpretation:- The above pie chart states that 99% of the total

sample knows about life insurance. Only 1% of the total sample does not know

about Life Insurance.

From the above interpretations it is very clear that almost every

body knows about Life Insurance.

Q.2. Do you know about Bajaj Allianz Securities Ltd.?

YES : 45%
NO : 55%

84
 According to the awareness among
the Customers about Bajaj Allianz
Sercurities Ltd.

45%
Yes
No
55%

Interpretation:- The above pie chart states that 55% of the total sample

does not know about Bajaj Allianz Life Insurance Corporation . Only 45% of

the total population knows about Bajaj Allianz Life Insurance Corporation.

From the above interpretation it is clear that although Bajaj Allianz is a

strong brand amongst the financial investors, people of Lakhimpur-city do not

know much about the company .

Q.3. How much can you invest per anum?

<10,000 : 37%
10,000-15,000 : 26%
15,000-20,000 : 20%
> 20,000 : 17%
85
 INVEST PER ANNUM

20%
37% <10000
10000-15000
17% 15000-20000
>20000
26%

Interpretation:- The above pie chart represents that 37%

population is willing to invest less than Rs. 10,000 & only 17% population is

willing to invest more than Rs. 20,000 per anum . While the people investing

between Rs. 10,000 to Rs. 20,000 are 46% of total population surveyed.

Q.4. For what duration would you like to hold the policy?

<5 years : 22%

5-10 Years : 52%
10-20 Years : 17%
86
 >20 Years : 9%

DURATION WOULD YOU LIKE TO

HOLD THE POLICY

9% 22%
17% <5 Years
5-10 Years
10-20 Years
>20 Years
52%

Interpretation:- The above pie chart clearly shows that the people
are more willing in the investment policies having maturity period between 5-10
years.
Investment policies having long maturity periods are less preferred by the
peoples.

Q.5. Which Insurance plan would you like to opt or opted?

Unit linked plans : 61%

Traditional plans : 39%

87
 According to the Preferance of Plan

39%
Traditional Plan
Unit Linked Plan
61%

Interpretation:- The above chart states that 61 % of the people of the

total sample size like to invest or they have already invested their money in
traditional plan of the Life Insurance while 39% of the people like to invest or
they have already invested their money in Unit linked plan, which is the modern
plan of the Life insurance.
So, it is clear from the above interpretation that traditional plans are still
popular among the masses although the modern unit linked plans are available
in the market.

Q.6. Do you like to invest your money in any company specific insurance
plan?
LIC : 63%
88
 Bajaj Allianz : 11%
HDFC : 6%
ICICI Prudential : 10%
Others : 10%

According to the of money in any

specific insurance plan

10% LIC
10% BAJAJ ALLIANZ
6%
HDFC
11% 63% ICICI PRUDENTIAL
OTHERS

Interpretation:- The above pie chart states that 63% of the population
wants to invest their money in L1C when there is any option of investing in life
insurance. 11 % of the total sample wants to invest their money in Bajaj
Allianz, 10% in ICICI Prudential, 6% in HDFC and the remaining 11% in other
than these brands.
From the above interpretations it is clear that L1C is the strongest brand
in comparison to the other private insurance company’s brand. It is also because
L1C is the oldest company when we talk about Life Insurance.

Q.7:- From whom do you want to buy or you bought insurance plan?

Direct from the company : 7%

Any consultant : 5%
Any agent : 88%

89
 According to the want of the customers
to buy or bought

7% 5% Direct From the

Company
Any Consultant

Any Agent
88%

Interpretation:- The above pie chart states that 88% of the total sample

sizes take the insurance polices from the insurance agents. 7% of the total

people take the insurance policies direct from the company and only 5% of the

total sample takes the insurance policies from the financial consultants.

So, here we can say that the mass prefer to take life insurance policies

from agents in other words the business of the life insurance is completely

dependent on the agents.

Q.8. Which type of information do you want while taking any insurance
plan?
About the company : 15%
About plan : 5%
90
 About returns : 14%
About initial investment : 8%
All the above : 58%

According to the information which the

customers want while taking any
insurance plan
ABOUT THE
COMPANY
15% ABOUT PLAN
5%
ABOUT RETURNS

58% 14% ABOUT INITIAL

8% INVESTMENTS
ALL THE ABOVE

Interpretation:- The above pie chart states that 5% of the total sample

size wants to know about the plan while taking any insurance plan 14 % of the

total sample is concerned about the returns while investing in life insurance.

15% of the total sample wants to know about the company, 5% of the total

sample wants to know about plan, 8% of the total sample wants to know about

initial investment while investing the money in life insurance while taking any

insurance plan. From the above interpretation it is clear that most of the people

are concerned about all the information while taking any life insurance policy.

The major information they want to know while taking any life insurance policy

is the information about the company & then about the returns.

Q.9. Where do you invest your money?

Share Market : 6%
Mutual Fund : 14%

91
 Insurance : 30%
Fixed Deposits : 45%
Others : 5%

According to the area in which the

customers invest the money

5% 6% Share Market
14%
Mutual Fund
Insurance
45% Fixed Deposit
30%
Others

Interpretation:- The above pie chart states that 45% of people invest
their money in Fixed Deposits, 30% of people invest in Insurance, 14% of
people invest in Mutual Funds , 6% of people invests in Share Market, 5% of
people in other than these options.
So it is very clear from the above interpretation that people still like to
invest their money in Fixed Deposits although other better options available in
the financial investment market.

.10. In your opinion which one is the best/ safest ?

IPO : 28%
Share Market : 3%

92
 Mutual Funds : 3%
Insurance : 36%
Fixed Deposits : 30%

ACCORDING TO BEST/SAFEST
OPTION
A
IPO

30 ShareM arket

28%
Mutual Funds
Insurance
Fixed Deposits

36 3

Interpretation:- The above interpretation shows that 30% population

believes that investing money in Fixed Deposits is best/safest 36% of the people

believe that insurance is the best/safest. While total 6% (3%+3%} of the people

believe that Mutual Funds & Share Market is the best/safest option for investing

their money. So from the above interpretation it is clear that people think that

investing their money in Fixed Deposit is the safest option available. It is also

true that is the oldest option available in the investment market. A mind set is

their in the minds of people that no other option is safest or best in terms of

investing their money.

Q.11. What are you expectations when you think about investment in
financial product?
Low Risk , Low Profits : 6%
Low Risk , High Profits : 72%
93
 High Risk , Low Profits : 0%
High Risk , High Profits : 22%

According to the expectations of

customers while investing in financial
product
Low Risks, Low
Profits
0% 6% High Risks, High
22% Profits
Low Risks, High
Profits
72% High Risks, Low
Profits

Interpretation:- drawn from the above pie chart states that 72% of the

people expect low risk and high profit when they think about investing their

money in financial product. While 22 % of the people expect high risk and high

profit when they think about investing their money in any financial product.

Only 6% of the people expect low risk and low profit form their financial

product & obviously none would like high risk and low Profits combination .

So it is very clear from the above interpretations that very less number of

people wants to take risk when it comes to investing the money. They also want

to make high profits without taking high risks.

Q.12. What attribute attracts the most while taking an insurance plan?

Tax Planning : 30%

94
 Risk Cover : 8%
Retirement Planing : 10%
Children Education : 22%
Investment Planing : 25%
Others : 5%

Attribute While Taking Insurance Plan

Tax Planning
5%
25% 30% Risk Cover
Retirement Planing
Children Education
8% Investment Planing
22% 10%
Others

Intrepretation :-There are so many reasons to take an investment plan. Most of

people like to take an investment plan to take tax benefit and some of them due

to uncertainity and risk factor in life. A large sample of population prefers an

insurance plan for their investment purpose. These are near about 25% of total

population. Near about 10% people likes to take a plan for retirement solution

and 22% for their children’s education.

Q.13. What additional benefit do you want from your policy?

Accidental 38%
Critical Illness 22%

95
 Start of Life 19%
Family Income Benefit 21%

Additional Benefit do you want from

your policy

Accidental
21%
38% Critical Illness

Start of Life
19%
22% Family Income
Benefit

Intrepretation :- The above pie chart shows that 38% of total populaton

likes to take a plan to get accidental benefit. After that they want other benefits

near about in the same ratio i. e. critical illness, start of life and family income

benefit with 22% , 19% and 21% respectively.

Q.14. Are you aware of the risk cover and other benefits that are offered in
Life Insurance?

96
 Yes : 69%
No : 31%

Aware of the Risk Cover and Other

Benefits that are offered Life
Insurance

31%
Yes
No
69%

Intrepretation :- The above pie chart shows that 69 % of the total

population is aware about the benefits given by the company and rest of the

population is not aware about it .

So , the company should try to make aware the peo[ple

aware about the benefits of the plan to make a good will among the population.

Q.15. Are you satisfied with the service that is offered by the Insurance
Company?

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 Yes : 48%
No : 52%

Service that is offered by the

Insurance Company

48% Yes
52% No

Intrepretation :- The above pie chart shows that only 48% of the

population is satisfied by the services offered by the company . a large segment

of population is not satisfied by the services offered by the company.

So , company should make efforts to improve after sales

services so that they can make a grip over the peoples.

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 FINDINGS

FINDINGS

The aim of the survey was to find out the "Awareness of Life Insurance

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and Changing Investment Pattern" All the due efforts were made to find out
the appropriate and confide results. Following are the various findings of the
research.
 People still like to invest their money in fixed Deposits although other
better options are available in the financial investment market.
 People think that investing their money in fixed Deposits is the safest
option available. It is also true that it is the oldest option available in the
investment market. A mind set is their in the minds of people that no other
option is safest or best in terms of investing their money.
 Very less number of people wants to take risk when it comes to investing
the money. They also want to make high profits without taking high risks.
 Almost every body knows about Life Insurance.
 Traditional plans are still popular among the masses although the modern
units linked plans are available in the market.
 L1C is the strongest brand in comparison to the other private insurance
company brands. It is also because L1C is the oldest company when we talk
about life insurance.
 Most of the people are concerned about the plan while taking any life
insurance policy. This is the major information they want to know while taking
any life insurance policy.

 Although Bajaj Allianz is a leading life insurance company but still

people of Lakhimpur-Kheri city do not know about the company and its
working .
100
 Most of the people prefer short-term investment.
 Most people have regarded shares as the most risky investment.
 Most of the people invest their money in banks and other government
securities.
 Very less number of people has invested in Life Insurance.
 Very less number of people has shown willingness to invest in Life
Insurance.
 Unit linked plan of life insurance are subject to market risk.
 A large slot of population doesn't have insurance policy which can be
target population for life insurance companies.
 People have much faith in Govt. securities than in private companies & it
is also found that people while investing require expert advice.

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CONCLUSION

CONCLUSION

102
 Conclusion should be drawn with direct reference to the objective of the

study. This project is directed towards the effectiveness of knowing the fact

about insurance sector. The overall effectiveness depends upon the interaction

with the persons.

As it has been discussed, insurance offer several benefits that are

unmatched by other investment options. Post liberalization, the industry has

been growing at a rapid pace in terms of its Assets Under Management.

However , due to the low key investor awareness , the inflow under

the industry is yet to overtake the inflows in banks . Rising inflation , falling

interest rates & a volatile equity market make a deadly cocktail for the investor

for whom insurance offer a route out of the impasse .

But it is the skill of the managing risks that investment managers

seeks to implement in order to strive & generate superior returns than otherwise

possible that makes them a better option than many others.

Now a days , the insurance sector is growing rapidly & BAJAJ

ALLIANZ is the one who has beated the no. 1 company in private insurance i.e.

ICICI Pru & very soon it will over perform LIC. So persons are keen to become

a part of it as an I.C. & further people are investing huge amount in it .

Thus , BAJAJ ALLIANZ is gaining trust in the hearts of customers /

investors.

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RECOMMENDATIONS

RECOMMENDATIONS

104
 Making recommendations assumes considerable knowledge of the

picture, including the resources of the firm and all the alternative courses of

action. A Communication system is necessary to maintain the uniformity &

balance in the flow of information within the fire.

Although is very early to suggest any thing to such a

internationally famous company Bajaj Allianz Life Insurance Company Ltd. in

it's mature state of marketing, interactions and feed backs from various outlets,

segments of investor. I would like to suggest as under :

 Consultant should disclose schemes provided by the company to each and

every investor.

 Consultant should have good relationship with the investor.

 In the case of tragedy the company should provide all facilities easily to

the investor.

 At least one glow sign board should be displayed in the main area of the

market.

 Company should promote good and heart felt slogans.

 Company should sponsor important events like World Cup, Afro Asian

games, any event related to film awards and other local programs.

105
 SWOT
ANALYSIS

106
 SWOT ANALYSIS

A SWOT Analysis is an effective way of identifying one’s strength &

weakness & to examine the opportunities & threats which may affect you .

 STRENGTHS :

 Intellectual & hard working Human Resource

 Large network

 customer base of banks

 Existing of resources of insurance companies

Weaknesses :

 Information technology not at par with other sectors

 Middle segment overburdened with inflationary pressure

 Inflexibility of products . not tailor made to suit the needs

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 OPPORTUNITIES :

 Untapped population

 Bank’s database in India is enormous

 Efficient IT structure of banks

 Appropriate atmosphere & political consensus

 THREATS :

 Channel conflict

 Banks venturing into insurance sector

 Change in preferred models to broker model

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LIMITATIONS

109
 LIMITATIONS

In the research conducted all the due efforts are made with full effort

and diligence but still their might be some error due to the following

reasons:

 Human behavior is too complex to determine. So the information

disclosed by them may not be very accurate.

 This research is conducted on a very small sample size, so it might be

possible that the information given by such respondents may not match with the

reply of the whole public of Lakhimpur-Kheri.

 There was a time constraint while conducting the report.

 It might be possible that the answers given by the respondents are full of

biasness.

 Some of the respondents ware not willing to reply the questions.

 A questionnaire is in English language, some respondents found it

difficult to understand it, even many refused.

110
APPENDIX

111
 QUESTIONAIRE

1- Do you know about life insurance policy?

Yes No
2- Do you know about Bajaj Allianz Securities Ltd.?
Yes No
3- How much can you invest per year?
<10000 10000-15000
15000-20000 >20000
4- Do you know about life insurance?
Yes No
5- Which insurance plan would you like to opt or opted?
Traditional Plan Unit Linked Plan
6- Do you like to invest your money in any company specific insurance
plan?
LIC Birla Sunlife Tata AIG
AVIVA Bajaj Allianz
7- From whom do you want to buy or you bought insurance plan?

112
 Direct from the company Any Consultant
Any agent

8- Which type of information do you want while taking any insurance

plan?
About The Company About Plan About Returns
About initial investment All of the above
9- Where do you invest your money?
IPO Share Market Mutual Fund
Fixed Deposit Bonds Others

10- In your opinion which one is the best/safest?

IPO Share Market Mutual Fund
Fixed Deposit Bonds Others
11- What are your expectations when you think about investment in
financial product?
Low Risks, Low Profits
High Risks, High Profits
Low Risks, High Profits
High Risks, Low Profits
12- What attribute attracts you the most while taking an insurance plan?
Tax Rebate Risk Cover Children Education
Investments Returns
13- What additional benefit do you want from the policy?
Accidental Critical Illness Start of Life
Family Income Benefit
14- Are you aware of the risk cover and other benefits that are offered in
Life Insurance?
Yes No
15- Are you satisfied by the services offered by the insurance company?

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 Yes No
Name : ......................................................
Age : ......................................................
Gender : ......................................................
Address : ......................................................
Occupation :
Service Businessman Student
Housewife Other
Income Group:
LIG MIG HIG

BIBLIOGRAPHY

114
 BIBLIOGRAPHY

WEBSITE :-

www.bajajallianz.com
www.bajajlifeinsurance.com
www.allianzbajaj.co.in
www.bajajallianzlife.co.in

BAJAJ ALLIANZ PUBLICATION :-

 Life Track (Magazine)

 Life News (Magazine)
 Brochures of the company

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GLOSSARY

116
 GLOSAARY

1- I.C. - Insurance Cosultancy.

2- Pollicies - A Product which is made by a comapny to insurance

customers.
3- IRDA - Insurance regulatory and development authority.

4- A.U.M. - Assets under management.

5- S.T.M. - Sales Team Manager.

6- B.M. - Branch Manager

7- OPEX - Operational Excellence

8- N.A.V. - Net Assest Value

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9- FIMMDA - Fixed income money market derivative association.

118