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Department of Management
CT GROUP OF INSTITUTION ,JALANDHAR
DECLARATION
I hereby declare that this project work entitled “Comparative analysis ofDHFL
Pramerica” with BAJAJ Allianz life insurance company” is my work, carried out under
the guidance of my faculty guides Assistant Professor Mr. Malkeet Singh and my
company guide Mr. Gurpreet Singh. This report neither full nor in part has ever been
submitted for award of any other degree of either this management college or any other
management college.
Countersigned
( ) ( )
Supervisor Candidate
CERTIFICATE
This is to certify that the summer training was done on “Comparative analysis of DHFL
Pramerica with BAJAJ Allianz life insurance company” submitted to ct group of institution
Supervision and Guidance. This work has not been submitted anywhere else for other
Degree/diploma. The original work was carried during 01/06/2015 to 15/07/2015 in “DHFL
INSURANCE CO. LTD, CHANDHIGARH, for his valuable guidance for preparing the Final Report
INSTITUTION,JALANDHAR for their timely guidance and support throughout the project work.
Finally I am indebted to our other faculty members, my friends and my parents who gave their full-
RAJWINDER AKUR
Content Page No.
CHAPTER No. 01
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1.1. Abstract ………….. 01
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1.2. Introduction ……………..02
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1.2.1. Insurance Industry ………….. 02
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1.2.2. About The Project …………..0 4
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1.2.3. Purpose of the Project …………..04
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1.2.4. Scope of the Project …………..0 5
CHAPTER NO. 02
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2. Review of Literature …………06
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2.1. About Insurance Industry in Brief ……… …06
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2.2. Logic of Insurance … …………06
… ………………
2.3. Need of Insurance … …………07
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2.4. Insurance in India … …07
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2.5 History of Insurance in India … …08
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2.6 Life Insurance Corporation Act.…………
1956 … ….. 09
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2.7 General Insurance Business … …………10
CHAPTER NO. 03
CHAPTER NO. 04
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4.1. Different Insurance Companies ………….. 11
CHAPTER NO. 05
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5.1. Advantage of Life Insurance ………….19
CHAPTER NO. 06
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6.1. Type of Insurance product …………..22
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6.1.1. Term Insurance Plan … .………….22
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6.1.2. Endowment Assurance Plan ..…………. 22
. …………
6.1.3. Money Back Policy …………… ……22
…
… …………….……
6.1.4. Whole life Plan … …..23
… ………………
6.1.5. Pension Plan … ………...23
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6.1.6. Child Plan …………...24
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6.1.7. ULIP ………….. 24
Page No.
Content
CHAPTER NO. 07
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7. 1. Marketing mix in Insurance Industry ……..25
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7.1.1. Introduction ……..25
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7.1.2. Insurance Marketing ……..26
CHAPTER NO. 08
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8.1. Costumer For DHFL Pramerica Insurance Company ……35
CHAPTER NO. 09
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9.1. Changing face of Indian Insurance industry ……37
CHAPTER NO. 10
CHAPTER NO. 11
CHAPTER NO. 12
Today every sector is very competitive sector and I find that insurance sector has the maximum
Growth and potential as compared to other sectors. Insurance has the maximum growth rate of
75% while as other sector has maximum 12-15% of growth rate. This growth potential attracts
to enter in this sector and DHFL Pramerica life insurance given me the opportunity to work and
get experience in the highly competitive and enhancing sector. This project studies the existing
Management practices In the channel development process and various benefits delivered by
them in the in DHFL Pramerica life insurance. The project is all about comparative analysis of
different insurance products of different companies. The objective of project was to check the
the awareness level of insurance and attitude towards the insurance in the current market.
Survey was also done regarding the preference of insurance sector depending on the age group
(Whether they prefer private player or public companies). In the beginning, I gain an insight
About the company and its value and inherit them in our life, and them studied different types
Of insurance plan like ULIP’S, Term plan, Endowment plan, and various other plans. Now, on
Statistical part, I designed a questionnaire that will provide a base for the studying the
Awareness lewel and perception of life insurance. The project helped me in developing my
Communication skills and interpersonal skills. During the tenure of my internship I learned
From my seniors, friends etc but all the above I learned a lot from my own personal experience.
1.2.1. INSURANCE INDUSTRY
The history of life insurance in India dates back to 1818 when it was conceived as a means to
Provide for English Widows. Interestingly in those days a higher premium was charged for
Indian lives than the non-Indian lives as Indian lives were considered more risky for coverage.
The Bombay Mutual Life Insurance Society started its business in 1870. It was the first
Company to charge same premium for both Indian and non-Indian lives. The Oriental Assurance
Company was established in 1880. The General insurance business in India, on the other hand,
can trace its roots to the Triton (Total) Insurance Company Limited, the first general insurance
company established in the year 1850 in Calcutta by the British. Till the end of nineteenth
century insurance business was almost entirely in the hands of overseas companies’ .Insurance
regulatation formally began in India with the passing of the Life Insurance Companies Act of
1912 and the provident fund Act of 1912. Several frauds during 20's and 30's sullied insurance
business in India. By 1938 there were 176 insurance companies. The first comprehensive
legislation was introduced with the Insurance Act of 1938 that provided strict State Control
over insurance business. The insurance business grew at a faster pace after independence.
Indian companies strengthened their hold on this business but despite the growth that was
provident societies under one nationalized monopoly corporation and Life Insurance
Corporation (LIC) was born. Nationalization was justified on the grounds that it would
create much needed funds for rapid industrialization. This was in conformity with the
Government's chosen path of State lead planning and development. The (non-life)
insurance business continued to thrive with the private sector till 1972. Their operations
were restricted to organized trade and industry in large cities. The general insurance
industry was nationalized in 1972. With this, nearly 107 insurers were amalgamated and
grouped into four companies- National Insurance Company, New India Assurance
Company, Oriental Insurance Company and United India Insurance Company. These were
subsidiaries of the General Insurance Company (GIC).The general insurance business was
by Insurance companiess
1)Introduction About “DHFL Pramerica Life Insurance
Company Ltd”.
DHFL Pramerica Life Insurance Company Ltd.(DPLI) is a joint venture
between Dewan Housing Finance Corporation Ltd. (DHFL) and Prudential
International Insurance Holdings, Ltd. (PIIH), a fully owned subsidiary
of Prudential Financial, Inc. (PFI), a financial services leader headquartered
in the U.S. DHFL Pramerica Life Insurance Company Ltd., which was earlier
known as DLF Pramerica Life Insurance Company Ltd. started operations in
India on September 01, 2008.
products, check the awareness level and perception of insurance by the individuals. The
project would also help in understanding preference of people regarding private and public
insurance companies.
5)To study the awareness level of Bajaj Allianz ULIPs with view to recommend
2)To determine customer preference towards private insurance companies and public
insurance companies.
The entry of foreign MNC’s and the conductive business environment fostered by the
government, it is no wonder that the re-entry of private insurance has marked a second
coming for the sector. In just five years, the sector has undergone a makeover, offering
more choice, better services, quicker settlement, tighter regulation and greater
awareness‘s the environment become more and more competitive and services and
products become alike, creating a differentiation is becoming extremely tough. Thus, the
main objective of my project was to find out the preference of people regarding insurance
companies, which would help DHFL Pramerica life insurance, employees to market their
product. The study then goes on to evaluate and analyze the findings so as to present a
2. REVIEW OF LITERATURE
2.1. About Insurance Industry
"Insurance is a contract between two parties whereby one party called
insurer undertakes in exchange for a fixed sum called premiums, to pay the other party
Insurance companies collect premiums to provide for this protection. A loss is paid out of
the premiums collected from the insuring public and the Insurance Companies act as
trustees to the amount collected. For Example, in a Life Policy, by paying a premium to
the Insurer, the family of the insured person receives a fixed compensation on the death of
the insured. Similarly, in a car insurance, in the event of the car meeting with an accident,
the insured receives the compensation to the extent of damage. It is a system by which the
losses suffered by a few are spread over many, exposed to similar risks.
similar risks. Insurance is a protection against financial loss arising on the happening of an
unexpected event. Insurance companies collect premiums to provide for this protection. A
loss is paid out of the amount premiums collected from the insuring public and the
account of risks and perils. It provides financial compensation for the losses suffered due
to the happening of any unforeseen events. By taking life insurance a person can have
peace of mind and need not worry about the financial consequences in case of any
untimely death. Certain Insurance contracts are also made compulsory by legislation. For
example, Motor Vehicles Act 1988, stipulates that a person driving a vehicle in a public
place should hold a valid insurance policy covering “Act" risks. Another example of
compulsory insurance pertains the Environmental Protection Act, wherein a person using
or to carrying hazardous substances (as defined in the Act) must hold a valid public
general insurance in India is still a nascent sector with huge potential for various global
players with the life insurance premiums accounting to 2.5% of the country's GDP while
general insurance premiums to 0.65% of India's GDP. The Insurance sector in India has
gone through a number of phases and changes, particularly in the recent years when the
Govt. of India in 1999 opened up the insurance sector by allowing private companies to
solicit insurance and also allowing FDI up to 26%. Ever since, the Indian insurance sector
is considered as a booming market with every other global insurance company wanting to
have a lion's share. Currently, the largest life insurance company in India is still owned by
the government.
2.5. History of Insurance in India
Insurance in India has its history dating back till 1818, when Oriental Life Insurance
European community. Pre-independent era in India saw discrimination among the life of
foreigners and Indians with higher premiums being charged for the latter. It was only in
the year 1870, Bombay Mutual Life Assurance Society, the first Indian insurance
company covered Indian lives at normal rates.At the dawn of the twentieth
century, insurance companies started mushrooming up. In the year 1912, the Life
Insurance Companies Act, and the Provident Fund Act were passed to regulate the
insurance business. The Life Insurance Companies Act, 1912 made it necessary that the
actuary. However, the disparage still existed as discrimination between Indian and foreign
Company Ltd, which was founded in 1906 and is doing business even today. The
Insurance industry earlier consisted of only two state insurers: Life Insurers i.e. Life
Insurance Corporation of India (LIC) and General Insurers i.e. General Insurance
Corporation of India (GIC). GIC had four subsidiary companies. With effect from
December 2000, these subsidiaries have been de-linked from parent company and
ordinance; the Life Insurance Corporation Act, 1956 effective from 1.9.1956
was enacted in the same year to, inter-alia, form LIFE INSURANCE CORPORATION
after nationalization of the 245 companies into one entity. There were 245
insurance companies of both Indian and foreign origin in 1956. Nationalization was
accomplished by the govt. acquisition of the management of the companies. The Life
Insurance Corporation of India was created on 1 September, 1956, as a result and has
the 100 odd general insurance companies and subsequently merging them into four
companies. All the companies were amalgamated into National Insurance, New India
the 100 odd general insurance companies and subsequently merging them into four
companies. All the companies were amalgamated into National Insurance, New India
, and United India Insurance which were headquartered in each of the four metropolitan
cities.
Chapter No. 3
Govt. of India then introduced the Insurance Regulatory and Development Authority Act
in 1999, thereby de-regulating the insurance sector and allowing private companies into
the insurance. Further, foreign investment was also allowed and capped at 26% holding
Medi claim, whereas in developed nations like USA about 75 % of the total
population are covered under some insurance scheme. With more and more private
insurance industry, in this year the life insurance industry was liberalized after more than
fifty years. Insurance sector was once a monopoly, with LIC as the only company, a
public sector enterprise. But nowadays the market opened up and there are many private
players competing in the market. There are fifteen private life insurance
companies has entered the industry. After the entry of these private players, the market
share of LIC has been considerably reduced. In the last five years the private players is
able to expand the market (growing at 30% per annum) and also has improved their
market share to 18%.For the past five years private players have launched many
products, agent training and customer services etc.The various life insurers entered India:-
18. Canara HSBC Oriental Bank of Commerce Life Insurance Co. Ltd
company accounting for 64% market share. Its share, however, has dropped from
74% a year before ,mainly owing to entry of private players with innovative
accounting for increase in market share to8.93% in 2007-08 from 6.97% in 2006-
07.
share went upto 6.98% in 2007-08 form 5.66% in 2006-07. The company ranked
second (after LIC) in numberof policies sold in 2007-08, with total market share of
7.36%.
ranked 6th in2007-08. New premium collection for the company was Rs 4,792.66
market share wentup to 2.96% from 1.23% a year back. It now ranks 5th in new
it ranks 6 th among theinsurance companies and 5th amongst the private players.
Birla Sun Life Insurance Co Ltd market share of the company increased from
Total new business generated was Rs 641.83 crore as against Rs 387.51 crore.
reported growth of 80%, moving from the 11th position to 9th. It captured a market
Aviva Life Insurance Company India Ltd ranking dropped to 10th in 2007-08 from 9thlast
year. It has presence in more than 3,000 locations across India via 221 branches and close
to40 banc assurance partnerships. Aviva Life Insurance plans to increase its capital base
by Rs 344 crore
LIC
ICICI Prodential
Bajaj Allianz
SBI Life
HDFC Standard
Birla Sun Life
DHFL Pramerica
Reliance life Insurance
Max Life Insurance
Om Kotak
Aviva
Tata AIG
Met Life
S. No. Company Market share
1 L.I.C. 48.10%
2 ICICI Prudential 13.70%
3 Bajaj Allianz 10.30%
4 SBI Life 6.20%
5 HDFC Standard 4.10%
6 Birla sun life 3.40%
7 Reliance life insurance 3.40%
8 Max life insurance 2.40%
9 Om Kotak 1.90%
10 AVIVA 1.80%
11 TATA AIG 1.50%
12 MetLife 1.40%
13 ING Vysya 1.20%
14 DHFL Pramerica 0.30%
Table No. 1
With a huge population base and large untapped market, insurance industry is a big
opportunity area in India for national as well as foreign investors. India is the fifth largest
life insurance market in the emerging insurance economies globally and is growing at 32-
34% annually. This impressive growth in the market has been driven by liberalization,
with new players significantly enhancing product awareness and promoting consumer
education and information. The strong growth potential of the country has also made
insurance markets in many developed economies has made the Indian market more
attractive for international insurance players. This research report will help the client to
intended as a rough guide to the direction in which the market is likely to move. Total life
•Total non-life insurance premium is expected to in crease at a CAGR of 25% for the
•With the entry of several low-cost airlines, along with fleet expansion by existing ones
and increasing corporate aircraft ownership, the Indian aviation insurance market is all set
•Home insurance segment is set to achieve a 100% growth as financial institutions have
•A booming life insurance market has propelled the Indian life insurance agents into
the‘top 10 country list’ in terms of membership to the Million Dollar Round Table
(MDRT)— an exclusive club for the highest performing life insurance agent
Chapter No. 5
Life insurance is a product, which offers protection against the risk of death
the full sum assured is made available under a life assurance policy, whereas under
other savings schemes, the total accumulated savings alone will be available.
the full sum assured is made available under a life assurance policy, whereas under
other savings schemes, the total accumulated savings alone will be available.
The life insured can name the person or persons to whom the policy money would be
payable in the event of his death .the proceeds of a life insurance policy can be protected
against the claims of the creditors of the life insured by effecting a valid assignment of
the policy. The beneficiaries are fully protected from creditors expect to the extent of any
for borrowing After 3 years, if the policyholder finds that he is unable to continue
payment of premiums he can surrender a policy for a cash sum. A life insurance policy is
A policy holder can take a loan from his insurance company against the Security of his life
insurance policy provided the terms of the terms of his policy allow such a loan. This loan
can be taken usually after a period of 3 years from commencement of the policy and is a
The unit link products gives comprehensive insurance solutions that cater to an
individual’s dual need of earning potentially high returns as well as stay for life. Thus
there is an option to invest money in the products that combine the best of insurance and
investment. In a volatile market conditions it is possible to secure both as one can hedge
the investment with saver investment vehicles that provide a diversified portfolio.
5.2.6 . Tax benefits
The Indian income tax act provides tax concessions to the policyholder both on payment
of premium and on the maturity amount. Under sec 88 the tax benefits on premium paid
by an individual for life insurance policies on his own life\on the life of spouse \children
minor or major, including married daughters. Under sec 6 of the married women’s
property act if a married man takes a policy of life insurance on his own life and expenses
on the face of it to be for the benefit of his wife or of his wife and children or any of them,
then it shall be deemed to be a trust for the benefit of his wife and children or any of them,
According to the interest so expressed and shall not so long as any object of trust remains
be subject to the control of the husband or to his creditors or form part of his estate. An
insurance policy taken by a married man in the above manner is ideal way to protect the
interest of his wife and children, even after his untimely death.
Chapter No. 6
In insurance language this is a “pure risk cover” a nd can be described as an insurance or risk
management product in its purest and simplest form. In case of your untimely death, your
dependents will receive the risk-cover amount or the ‘sum assured’. On the other hand, there
is no survival benefits if you survive the policy term, and you also do not get back the
premiums paid.
cover (in the event of death of life insured) or maturity benefits if he/she survives the
policy term. Endowment plans are typically front-loaded. Therefore it makes sense for you to
It is a variant of the endowment assurance policy-the difference is that you get the survival
benefits intermittently over the life of the policy. Thus taking care of his lump-sum monetary
requirements to enable him to meet his financial goals and major commitments. The maturity
benefit is the sum assured value less the survival benefits already paid under
the policy, plus bonuses accrued, if any. In case of untimely death the nominee will receive
the entire sum assured without considering the payouts already made to you before the
unfortunate death.
This policy provides the life assurance cover for almost the entire life. Most of the insurance
companies provide protection up to the age of 100 years. The sum assured is paid to you once
you reach this age, and the policy is terminated. In this payment of premium is for whole life,
and the sum assured is paid to your nominee in the event of your death. In other words, this is
retirement plans, these are designed to ensure that you are financially independent during your
retirement years. Most of the pension plans also provide an optional life assurance cover in
them.
6.1.6. Child plan-
It basically aims at ensuring the achievement of life goals of your child. The goal can be
child plan, the life assured can be the parent or the child. The beneficiary for the policy,
however, is the child. As a child is a minor, the life insurance contract is between the parent
and the insurance company. In case of early death of the parent, the premium payment is
waived off by the insurance company and the policy continues as originally planned.
ULIPs have been the darling of insurance companies, intermediaries and the insured
population alike over the last five years. The main reason for this popularity is the twin
advantage of a pure life cover (insurance component) and a range of investment funds or
options (savings component) to match your risk profile. While the pure life cover provides the
much needed financial security to your dependents in the event of your untimely death, the
savings component allows you to participate in the capital markets and build wealth over the
7.1.1. INTRODUCTION:
Wherever there is uncertainty there is risk. We do not have any control over uncertainties
which involves financial losses. The risks may be certain events like death, pension,
retirement or uncertain events like theft, fire, accident, etc. Insurance is a financial service for
collecting the savings of the public and providing them with risk coverage. The main function
It also provides capital to the society as the funds accumulated are invested in productive
heads. Insurance comes under the service sector and while marketing this service, due care is
to be taken in quality product and customer satisfaction. While marketing the services, it is
also pertinent that they think about the innovative promotional measures. It is not sufficient
that you perform well but it is also important that you let others know about the quality of
your positive contributions. The creativity in the promotional measures is the need of the hour.
The advertisement, public relations, word of mouth communication needs due care and
The term Insurance Marketing refers to the marketing of Insurance services with the aim to
create customer and generate profit through customer satisfaction. The Insurance Marketing
focuses on the formulation of an ideal mix for Insurance business so that the Insurance
The marketing mix is the combination of marketing activities that an organization engages in
so as to best meet the needs of its targeted market. The Insurance business deals in selling
services and therefore due weightage in the formation of marketing mix for the Insurance
business is needed. The marketing mix includes sub-mixes of the 7 P’s of marketing i.e. the
product, its price, place, promotion, people, process & physical attraction. The above
7.1.3.1. PRODUCT
A product means what we produce. If we produce goods, it means tangible product and when
we produce or generate services, it means intangible service product. A product is both what a
seller has to sell and a buyer has to buy. Thus, an Insurance company sells services and
therefore services are their product. In India, the Life Insurance Corporation of India (LIC)
7.1.3.2. PRICING:
ii) Interest charged for defaulting the payment of premium and credit facility, and
With a view of influencing the target market or prospects the formulation of pricing strategy
becomes significant. In a developing country like India where the disposable income in the
hands of prospects is low, the pricing decision also governs the transformation of potential
policyholders into actual policyholders. The strategies may be high or low pricing keeping in
view the level or standard of customers or the policyholders. The pricing in insurance is in the
form of premium rates. The three main factors used for determining the premium rates under a
life insurance plan are mortality, expense and interest. The premium rates are revised if there
The management of agents and insurance personnel is found significant with the viewpoint of
maintaining the norms for offering the services. This is also to process the services to the end
management of insurance branch offices needs a new vision, distinct approach and an
innovative style. This is essential to make the work place conducive, attractive and proactive
for the generation of efficiency among employees. The branch managers need professional
7.1.3.4. PROMOTION:
The insurance services depend on effective promotional measures. In a country like India, the
rate of illiteracy is very high and the rural economy has dominance in the national economy. It
is essential to have both personal and impersonal promotion strategies. In promoting insurance
business, the agents and the rural career agents play an important role. Due attention should be
given in selecting the promotional tools for agents and rural career agents and even for the
branch managers and front line staff. They also have to be given proper training in order to
create impulse buying. Advertising and Publicity, organisation of conferences and seminars,
publicity van units would be effective in creating the impulse buying and the rural prospects
7.1.3.5. PEOPLE:
Understanding the customer better allows to design appropriate products. Being a service
industry which involves a high level of people interaction, it is very important to use this
relationships with intermediaries are the key areas to be kept under consideration. Training the
employees, use of IT for efficiency, both at the staff and agent level, is one of the important
7.1.3.6. PROCESS:
The process should be customer friendly in insurance industry. The speed and accuracy of
payment is of great importance. The processing method should be easy and convenient to the
customers. Installment schemes should be streamlined to cater to the ever growing demands of
the customers. IT & Data Warehousing will smoothen the process flow. IT will help in
servicing large no. of customers efficiently and bring down overheads. Technology can either
complement or supplement the channels of distribution cost effectively. It can also help to
improve customer service levels. The use of data warehousing management and mining will
help to find out the profitability and potential of various customers product segments.
Chapter No. 8
as investment tools and also as protection for themselves and their families. All the insurance
companies the world over are looking at attracting the eye balls of customer and positioning
their solutions innovatively to cater to niche and specific markets. One of the most critical
aspects both from the view point of the customer and the insurer is getting important and
There is a big need for market intelligence, database of products and services and secondary
data that can be converted in to leads for the companies to tap. The customer also needs to
have relevant life insurance lead information on products that give him the best value for his
money. The Internet is the best repository for all relevant information both for the potential
customers as well as the insurance companies. The insurance companies can put up all kinds
of data and information on their websites that a potential customer can conveniently use to
arrive at a decision. On the other end of the spectrum, a customer can use relevant keywords
to search for information on the Internet to get hold of a good insurance product. So, the key
lies to getting “Search Engine Optimization” done b y the insurance companies so that every
time an insurance specific keyword is used to search the Internet, their website is one of the
first to be displayed. This assures a large internet traffic that can help generate potential leads
from the information and digital footprints left by the visitors and can be later converted to paying
customers. Various B2B and B2C portals offer a host of innovative services that can be used as
leads by the insurance companies and also the potential customers who are looking for a good deal
in today’s insurance jungle. Nowadays, banks have entered the insurance domain and since they
have a variety of customers already in their folds, they can use their readily available database as
leads to contact potential customers for their insurance products. For consultants and insurance
agents, it is imperative that they get associated for a symbiotic relationship with retail shops and
chains via the internet as well as otherwise to gain maximum visibility and use tools such as
advertisement, mailers, flyers and sales incentives to gather life insurance leads and convert them to
potential customers. The customer gets the best of everything in the present scenario. All that a
prospective client has to do is log on to the internet, or call a toll free number or walk into an office
to get the best deal. However, it is always good to use all the resources, leads and information
available to ensure that he decides on the best product available. There are many ways in which
both the customer and the insurer can get access to all important life insurance lead. The trick lies
in using the leads well to get the most out of a particular situation. The endeavor of a company is to
position itself favorably so that the customer chooses him over other similar products while the job
of the client is to use the leads in such an effective way so that there is no reason for him to repent
Indian life-insurance market is the target market of all the companies who either want to
extend or diversify their business. To tap the Indian market there has been tie-ups
between the major Indian companies with other International insurance companies to start
up their business. The government of India has set up rules that no foreign
insurance company can setup their business individually here and they have to tie up with an
Indian company and this foreign insurance company can have an investment of only 24% of
the total start-up investment. Indian insurance industry can be featured by:
insurance products.
Today, the Indian life insurance industry has a dozen private players, each of which are
making strides in raising awareness levels, introducing innovative products and increasing the
of private insurers have introduced attractive products to meet the needs of their target
Market Performance & Forecast: In 2000, Indian insurance market size was $21.71 billion.
Between 2000 and 2007, it had an increase of 120% and reached $47.89 billion. Between
2000 and 2007, total premiums maintained an average growth rate of 11.96% and the CAGR
growth during this time frame has been 11.96%. It was one of the most consistent growth
patterns we have noticed in any other emerging economies in Asian as well as Global markets.
Indian economy is the 12th largest in the world, with a GDP of $1.25 trillion and 3rd largest in
terms of purchasing power parity. With factors like a stable 8-9 per cent annual growth, rising
foreign exchange reserves, a booming capital market and a rapidly expanding FDI inflows, it is on
the fulcrum of an ever increasing growth curve. Insurance is one major sector which has been on a
continuous growth curve since the revival of Indian economy. Taking into account the huge
population and growing per capita income besides several other driving factors, a huge opportunity
is in store for the insurance companies in India. According to the latest research findings, nearly
80% of Indian population is without life insurance cover while health insurance and non-life
insurance continues to be below international standards. And this part of the population is also
subjected to weak social security and pension systems with hardly any old age income security. As
per our findings, insurance in India is primarily used as a means to improve personal finances and
for income tax planning; Indians have a tendency to invest in properties and gold followed by bank
deposits. They selectively invest in shares also but the percentage is very small 4-5%. This in itself is
an indicator that growth potential for the insurance sector is immense. It’s a business growing at
the rate of 15-20% per annum and presently is of the order of $47.9 billion.India is a vast market
for life insurance that is directly proportional to the growth in premiums and an increase in life
density. With the entry of private sector players backed by foreign expertise, Indian insurance
market has become more vibrant. Competition in this market is increasing with company’s
Major Driving Factors
✔ The opening of the pension sector and the establishment of the new pension
regulator
✔ Rising per capita incomes among the strong middle class, and spreading
affluence
Emerging Areas
The upward growth trend started from 2000 was mainly due to economic policies adopted by
the then Indian government. This year saw initiation of an era of economic liberalization and
globalization in the Indian economy followed by several reforms and long-term policies that
created a perfect roadmap for the success of Indian financial markets. On the basis of several
macroeconomic factors like increase in literacy rate & per capita income, decrease in death
rate and unemployment, better tax rebates, growing GDP etc., we estimate that the Indian
insurance sector will grow by $28.65 billion and reach $76.54 billion by 2011 with a CAGR
Both under insurance and over insurance can often be attributed to the lack of proper
understanding of the exact insurance needs for oneself and the family, and the failure to
spot and cover all liabilities properly and adequately, or being over-conservative in this
regard.
Under insurance, typically occurs when the existing financial liabilities and insurance
needs are fully taken care of. In the event of the untimely death of the only (or the main
earning) member of the family, his financial liabilities would obviously fall on his dependents,
leaving them in a state of financial distress that could threaten their need of sustenance.
Conversely, there are also instances where individuals indulge in life insurance covers that far
exceed in value than what is actually required. This is a classic case of over insurance, which
leads to an unnecessarily higher premium payment, leaving you much poorer. It results in
unnecessary expenditure that could otherwise be wisely invested Elsewhere. The need for an
adequate insurance cover is never static and keeps on varying with changes in the life stages
and important events of an individual. The table below provides an insight into the various life
stages and events when life insurance cover usually requires a revision
Busting some insurance myths
With a range of products flooding the market, people today are more confused about
insurance than ever. Here are a bagful of myths floating around and I have made an
1. I don’t want to put my hard-earned money into a pure term assurance plan if I don’t even
➢A pure term assurance plan is a risk mitigation tool and not an investment product. In the
event of your untimely death during the policy term, your dependents get a “sum assured”
to enable them to continue living their existing lifestyle, repay loan liabilities and meet
long-term financial goals. To achieve this, you only need to pay a premium amount that is a
fraction of the “sum assured”. Moreover unlike inve stments, where it takes years to build a
payable, in the event of your untimely death, from the date of its
commencement.
2. It would be enough if only the main breadwinner of the family takes life
insurance.
➢While the main breadwinner should take out a life insurance policy on a priority basis; the
other members of the family should also be covered. If the wife is working, then she should be
covered to the extent of loss of income to the family in the event of her untimely death. On the
other hand, even if she is not working, she should be covered, albeit for a smaller
sum, because her contribution to the family, in form of household services, has monetary
value.
3. I will get back all my premiums when I surrender my endowment policy prematurely.
➢You couldn’t be more wrong! You only get back the “surrender value”, which is based on
the “paid-up value” is a proportion of the original “sum assured” based on the number
of years for which premium was paid against the total premium-paying years. The
paid-up value of the policy is also calculated and available as per the policy conditions.
breaks, the primary objective of insurance is risk mitigations followed by wealth creation for
the long term. Many people end up taking this myth too seriously, particularly without
5. After three years, I can walk away from any ULIP, along with the accrued investment or
➢Sure, you can do that! However, you need to remember that a ULIP, at least in the
initial years, is very different from a mutual fund. While a mutual fund only charges o
nominal fund management charge every year, a ULIP is front loaded. That means a significant
chunk of your premium is allocated across various charges in the initial years of the policy
and only the balance gets invested in a fund of your choice. As these charges taper
Chapter No. 11
74 26
*PIIH is a fully owned subsidiary of Prudential Financial Inc, referred to hereafter as PFI. PIIH and PFI
of the United States are not affiliated with Prudential Plc., a company incorporated in the United
Kingdom.
Pramerica is the brand name used in India and select countries by PFI.
Pramerica and the Rock logo are proprietary service marks and may not be used without the express
permission of the owner
DHFL – AN OVERVIEW
DHFL was founded in 1984 by Shri Rajesh Kumar Wadhawan, a visionary Indian
businessman, who believed that owning a home is a critical element of building
Over the past 29 years, DHFL has been providing financial access to the
lower and middle income segments, in semi-urban and rural parts of India
Under the leadership of Mr. Kapil Wadhawan, CMD, DHFL stands strong as
India’s second largest housing finance company in the private sector
Based in India’s commercial capital Mumbai, DHFL has a presence across
over 450 locations in India, to ensure consumer access
Has tie-ups with leading public and private sector banks like Punjab & Sind Bank, United
Bank of India, Central Bank of India and YES bank, to provide home loans to customers through
a home loan syndication agreement
Listed on the BSE and NSE
DHFL STRIVES COUTINOULLY TO REACH OUT TO ITS TO REACH OUT ITS CUSTOMER
THROUGH ITS EXTENSIVE NETWORK OF BRANCES, SERVICE SENTERS,CAMPS AND
REGIONAL PROCESSING SPREAD OVER ACROSS THE LENGTH AND BREADH OF THE
COUNTRY.
BILLION
s of: Home Loan, NRI Home Loan, Fixed Deposit, Recurring Deposit,
PFI- AN OVERVIEW
History
Tracing its roots to 1875, PFI is one of the best-known names in financial services in the U.S.
Company Overview
For more than 135 years, PFI has helped individual and institutional customers grow and
protect their wealth
One of the world's largest financial services institutions with more than $1.1 trillion of
assets under management (as of March 31, 2014)
PFI, through its subsidiaries, serves institutional and individual customers in more
than 41 countries in the United States, Asia, Europe and Latin America (as of March
31, 2013)
47,355 employees and sales associates worldwide (as of December 31, 2013)
Offers a variety of products and services, including life insurance, annuities, retirement-
related services, mutual funds and investment management
PFI’s distinctive Rock® symbol is among the most widely recognized in the U.S. and is an
icon of strength, stability, expertise and innovation
BUSINESS OVERVIEW
A coming together of two strong and trusted financial houses who share our vision
DHFL - A company that is committed to help build an identity for every Indian by
empowering families financially to fulfill their dreams of owning a home
PFI - A company that is committed to help ensure financial security and peace of mind for its
customers through a variety of products and services, backed by sound financial advice
Our Company
• Started operations in 2008 as DLF Pramerica Life Insurance, a joint venture between DLF
Limited (DLF), a leading real estate company in India and PFI, to provide life insurance
products to customers in India
• In 2013, Dewan Housing Finance Corporation Limited (DHFL) and its promoter
entities acquired DLF Ltd.’s 74 percent interest in the JV and entered into a
partnership with PFI
• Pan India presence through multiple distribution channels which have been customized to
address the specific insurance needs of diverse customer segments
• 2000+ employees, 3500+ sales advisors and over 100 Third Party relationships
• Offers a comprehensive suite of long-term savings and protection-oriented products.
PFI - A company that is committed to help ensure financial security and peace of mind for its
customers through a variety of products and services, backed by sound financial advice
Our Company
• Started operations in 2008 as DLF Pramerica Life Insurance, a joint venture between DLF
Limited (DLF), a leading real estate company in India and PFI, to provide life insurance
products to customers in India
• In 2013, Dewan Housing Finance Corporation Limited (DHFL) and its promoter
entities acquired DLF Ltd.’s 74 percent interest in the JV and entered into a
partnership with PFI
• Pan India presence through multiple distribution channels which have been customized to
address the specific insurance needs of diverse customer segments
• 2000+ employees, 3500+ sales advisors and over 100 Third Party relationships
• Offers a comprehensive suite of long-term savings and protection-oriented products.
At R.L.I. we strongly believe that as is different at every stage, insurance must offer flexibility
and choice to go with that stage. We are fully prepared and committed to guide you on
insurance products and services through our well-trained advisors, backed by competent
•It is our aim to become one of the top private insurance companies in India and to
• “To set the standard in helping our customers manag e their financial future”.
BELOW ARE FEW OF THE PLANS THAT ARE OFFERED BY DHFL Pramerica
1. Aajeevan Samriddhi
2. U-Protect
4. Rakhshakplus
5. Family_First_Sep
6. Wealth Ace
Tax Benefits
It is one kind on benefit from life insurance policy . Maximum people buy insurance
individual
20% limit: If the amount of premium paid in a financial year for a policy is in
excess of 20% of the actual capital sum assured, then deduction will be allowed
premiums). The limit of deduction under Section 80C will be part of the overall
under a pension scheme. As per this Section, the whole of amount paid or deposited
does not exceed the amount of Rs 100,000 is eligible for deduction from the total
income.
3. Limit: The limit of deduction under Section 80CCC will be part of the overall limit
excess of 20% of the actual capital sum assured, then deduction will be allowed
premiums). The limit of deduction under Section 80C will be part of the overall
under a pension scheme. As per this Section, the whole of amount paid or deposited
does not exceed the amount of Rs 100,000 is eligible for deduction from the total
income.
6. Limit: The limit of deduction under Section 80CCC will be part of the overall limit
As per this section, the maximum amount of deduction that an assessee can claim under
2. Eligible premiums: Premiums paid by assessee by any mode other than cash out of
following persons:
the individual can pay the premium and claim the deduction.
As per Section 10(10D) of Income tax Act, 1961, any sum received under a life insurance
policy, including the sum allocated by way of bonus on such policy is exempt from tax.
As per Section 10(10D) of Income tax Act, 1961, any sum received under a life insurance
policy, including the sum allocated by way of bonus on such policy is exempt from tax.
been issued on or after April 1 2003 and if the premium paid in any of the years
during the term of the policy is more than 20% of the sum assured.
Tax Rates for Individuals
Rs. 2,50,001 to Rs. 500,000 Rs. 2,50,001 to Rs. Rs. 3,00,001 to Rs. 10%
500,000 500,000
10,00,000 10,00,000
Table No. 1
No surcharge on Income Tax for the Financial Year 2014-15 for Individuals.
Edcuation Cess @3% will be payable on the amount of income tax (including
surcharge
Chapter No. 12
12.1 OTHERS PLAYERS
Birla sun life Insurance Company limited is a joint venture between the Aditya Birla group,
one of the largest business houses in India and Sun Life Financial Inc., as leading
international financial services organization. The local knowledge of the Aditya Birla
group combined with the expertise of Sun Life Financial Inc., offer a formidable protection
for your future. The Aditya Birla group has a turnover of Rs. 1,33,875 corers (as on 31st
march 2008). It has over 100,000 employees across all its units worldwide. It is led by its
chairman – Mr. Kumar Mangalam Birla. Some of its key companies are Hindalco, Grasim
and Aditya Birla Nuvo. Sun Life Financial Inc. and its partners, have operations in key
markets worldwide. These include Canada, U.S, U.K, Hong Kong, the Philippines, Japan,
Indonesia, India, china and Bermuda. Sun Life Financial Inc. has
assets under management of over us$ 404.7 BILLION (as on 31st March, 2008). It is a
leading performer in the life insurance market in Canada.Birla sun life insurance
(BSLI) has been operating for 7 years. It has contributed significantly to the growth and
development of the life insurance industry in India. It pioneered the launch of unit linked
life insurance plans amongst the private player in India. It pioneered the launch of united
Mission
"Explore and enhance the quality of life of people through financial security by providing
products and services of aspired attributes with competitive returns, and by rendering
Vision
Pride of India Every day we wake up to the fact that more than 220 million lives are part
of our family called LIC.We are humbled by the magnitude of the responsibility we carry
and realize that the lives that are associated with us are very valuable indeed. Although
this journey started five decades ago, we are still conscious of the fact that, while
insurance may be a business for us, being part of millions of lives every day for the past
National Insurance Company Limited was incorporated in 1906 with its registered office
and National became a subsidiary of General Insurance Corporation of India (GIC) which
is fully owned by the Government of India. After the notification of the General Insurance
Business (Nationalisation) Amendment Act, on 7th August 2002, National has been de-
linked from its holding company GIC and presently operating as a Government of India
undertaking.National Insurance Company Ltd (NIC) is one of the leading public sector
insurance companies of India, carrying out non life insurance business. Headquartered in
16,000 skilled personnel, is spread over the length and breadth of the country
Covering remote rural areas, townships and metropolitan cities. NIC's foreign
operations are carried out from its branch offices in Nepal.National transacts
The Company is privileged to cater its services to almost every sector or industry in the
Power, Oil & Energy, Agronomy, Plantations, Foreign Trade, Healthcare, Tea,
largest non life insurer in India having a large market presence in Northern and Eastern
India.
12.1.4. Tata AIG life-A New Look at Life
Tata AIG Life Insurance Company Limited (Tata AIG Life) is a joint venture company,
formed by the Tata Group and American International Group, Inc. The Tata Group holds
74 percent stake in the insurance venture with AIG holding the balance 26 percent.Tata
AIG Life provides insurance solutions to individuals and corporate. Tata AIG
and started operations on April 1, 2001. Tata AIG Life offers a broad array of life
insurance coverage to both individuals and groups, providing various types of add-ons and
options on basic life products to give consumers flexibility and choice
Chapter No. 13
13.1 Sources
The success of any Insurance company depends on how well they are able to align
Provide proper solutions to them. To know how a company is performing and whether
they have any cutting edge advantage over competitors, an intensive study of the market is
market, we did two types of surveys, primary survey and secondary survey.
Library.
Internet.
DFHL Reports
13.1.4. Methodology
Target population: The target population for the research would be people who are in
theage group beyond 40 and age group between 25 to 40.We targeted this group of
The research would be conducted in Varanasi. The survey has been conducted among the
potential customers of DHFL Pramerica from different sectors as Reliance deals in many
sectors of business.
13.1.5.2. Sampling Technique :
The sampling technique that is adopted is the simple random sampling wherein every
element in the target population has an equal chance or probability of getting selected in
the sample. That means every unit of the population who is more is in the above
50 each; that is
The research would be conducted from the source of primary data collection. Secondary
data would help us in knowing the trends prevailing in the insurance market and would
We have presented below the findings and analysis of the questionnaire addressed to the
respondents to gauge the attitude and perception of the people towards insurance.
Respondents having life insurance
The question was asked to the respondents to know how many of the respondents
Yes
No
No. of
Respondents
Yes 55
No 15
From the survey it was found out that 85% of the respon dents had a life insurance policy
whereas 15 % of the respondents didn’t had a life insurance pol
1.What is your total saving ratio from your income?
SAVINGS
47%
50%
40%
31%
30%
CUSTOMER
RESPONSE
20% Series1
13%
9%
10%
0%
> 60% 60%-50% 50%-25% <25%
SAVING CONSIST
25% 23%
20%
20%
0%
Post Office Shares Life Mutual
Insurance Fund
Interpretation: From the above graph it is clear that, 10% of people saving in
post office, 20% of people savings in Bank FD, 8% of people savings in shares,
13% of people saving consist land and building, 23%
of people savings in Life Insurance, 5% of people saving consist in gold,8% of
people saving in Mutual Fund
3. Which factors you think while selecting the policy.
a) Returns b) Safety
29%
30%
24%
25% 20% 19%
20%
CUSTOMER
RESPONSE15%
8%
10%
5%
0%
Returns safety Liquidity Risk All the
cover above
a) Yes b) No
75%
80%
70%
60%
CUSTOMER 50%
RESPONSE Series1
40% 25%
30%
20%
10%
0%
Yes No
Interpretation: From the above graph it is clear that 75% respondents invested
their money in life insurance, 25% respondents are not invested
5. Are you aware about ULIP plan?
a) Yes
b) No
AWARENESS OF ULIP
45%
55% Yes
No
c) ICICI d) Others .
24%
42%
9%
ICICI
8% BAJAJ ALLIANZ
ICICI
17% OTHERS
DHFL
29%
30% 27%
25%
20% 17% 16%
CUSTOMER
RESPONSE 15% Series1
8%
10%
4%
5%
0%
Endowment Term Plan All the
above
100%
80%
60%
91%
40%
CUSTOMER
RESPONSE
20% Series1
4% 1% 2% 2%
0%
Higher Life Liquidity All the Blank
returns cover above
a) 10000 b) 10000-25000
c) 25000-50000 d) 50000-100000
38%
40%
35% 31%
30%
25%
CUSTOMER
17%
RESPONSE 20% Series1
15% 11%
10%
3%
5%
0%
A B C D BLANK
b) Tax Consultant/ C. A
d) Finance Magazines.
1%
9%
14%
47%
22%
7%
Discussion with FM
Tax consultant/CA
IC /Agents
Finance Magizine
Websits
Others
a) Returns b) Safety
15%
CUSTOMER 8%
RESPONSE 10%
5%
0%
Returns safety Liquidity Risk All the
cover above
After the survey it was found that still major portion of customers go for public insurance
companies, but with the entry of more and more private companies the scenario is
changing rapidly, people with a need of more and better returns are opting for private
companies, and this can be justified by the increasing market share of private companies
There are various ways in which private companies are found much more lucrative than
public companies and the facts which support this statement are as follows:-
1. Versatility of products.
4. More returns.
6. Quicker settlement
13.1.9. Suggestions and recommendation
✔ People are not aware of the life insurance. Most of them know only one
should be run so that people are aware of different life insurance companies
in India.
offered by the life insurance companies. Most of them don’t know much of
✔ It was felt that most of the people took life for tax savings or just to
hold on to the policyholders trust which might lead the company to the
path of success
their products or plan. Companies should not primarily focus on the agents
sector alone employs close to 30 lakh people (including agents and direct
individuals.
The life insurance market in India is on a growth path. In spite of this, the
country lags far behind the others in awareness about life insurance. The
challenge is to spread awareness about life insurance and it true benefits. The
industry has to convince people to park their hard earned money in long-term
difficult.
is challenging.
Publisher- Prentice Hall of India (p) Ltd, Analyzing Consumer Markets & Buyer
behavior & consumer behaviour.
WEBSITES
www.dhflpramerica.com
www.irdaindia.org
wikipedia.org
www.selling-well.com
www.insureme.com
www.advisortoday.com
Annexure
QUESTIONNAIRES
CLIENT DETAIL
NAME:_____________________________SURNAME__________________________
_____
DATE OF BIRTH: ______________ (As On Document) Age
Proof:_______________________________________________
PRESENTADDRESS_____________________________________________________
________________________________________________________________________
________________________________________________________________________
_____
LANDMARK: ______________________PIN ___________
PHONE NO _____________ MOBILE________________
PERMANENT ADDRESS:
____________________________________________________________
________________________________________________________________________
_____EDUCATION: _____________
OCCUPATION: _______________________
DESIGNATION: ___________________________
GROSSINCOME:____________________________
NO. OF YEAR JOB / BUSINESS: _______________________
NAME OF
ORGANISATION:_______________________________________________
PREVIOUS POLICY DETAILS (IF ANY):
_______________________________________________________________
PRODUCT: ______________ _________PREMIUM __________________________
MODE : Yearly/Half-yearly/monthly
Payment Mode: CASH / DD / CHEQUE
Reference:
1. Mr./Mrs./Miss.____________________Address:_____________Mobile No:
2. Mr./Mrs./Miss.____________________Address:_____________Mobile No:
INSURANCE CO.LTD
LIFE CORPORATION OF
INDIA
INSURANCE LTD
INSURANCE COMPANY
LTD
INSURANCE COMPANY