Professional Documents
Culture Documents
ON
SUBMITTED BY:
___________
ENROLLMENT No. _________
BATCH NO. _______
DECLARATION
This is to certify that Report entitled Consumer Perception on HDFC Life Insurance
Productwhich is submitted by me in partial fulfillment of the requirement for the award of
degree BBA to GGSIP University, Dwarka, Delhi comprises only my original work and due
acknowledgement has been made in the text to all other material used.
Date:
APPROVED BY
Name of Student
Name of Subject
Teacher/Guide
CERTIFICATE
This is to certify that Report entitled Consumer Perception On HDFC Life Insurance Product
which is submitted by ________ in partial fulfillment of the requirement for the award of degree
B.B.A. to GGSIP University, Dwarka, Delhi is a record of the candidate own work carried out by
him under my/our supervision. The matter embodied in this thesis is original and has not been
submitted for the award of any other degree.
Date:
Supervisor Signature
ACKNOWLEDGEMENT
I offer my sincere thanks and humble regards to ____________, GGSIP University, New Delhi
for imparting us very valuable professional training in BBA.
.
I pay my gratitude and sincere regards to _____________ my project Guide for
giving me the cream of his knowledge. I am thankful to him as he has been a constant
source of advice, motivation and inspiration. I am also thankful to him for giving his
suggestions and encouragement throughout the project work.
I take the opportunity to express my gratitude and thanks to our computer Lab staff
and library staff for providing me opportunity to utilize their resources for the
completion of the project.
Students Signature
EXECUTIVE SUMMARY
4
The project A study on Consumer Perception about Insurance Company is undertaken under
the guidance of _________ . It looks deep into the effectiveness at senior level. It also provides a
comparative
study
of
HDFC
Life
Insurance
Company
Ltd. withsome national companies with similar profiles to discuss their working structure and
suggest to organization .On the basis of feedback through questionnaire, interview and
observation method, we find out the perception view about the insurance companys working
style and services offered is quite effective, Management of HDFC LIFE is constantly making
efforts to make the company the best place to work for level. As they are measures of individuals
psychological makeup and personality and as such are extremely powerful instruments as find
out from our comparative analysis results.
In order to make them proactive., it is required to provide them with such kind
of environment, and equally have people oientation too in order to make a company best place
to work for high performers and creating a congenial environment.
Table of Contents
5
Student declarationi
Certificate from Guide...........ii
Acknowledgement.........................................................................................................iii
Executive Summary....iv
CHAPTER- 1: INTRODUCTION
1.1 About the Industry
1.2 About Organization/ Company Profile
CHAPTER- 6: CONCLUSION
BIBLIOGRAPHY
Bibliography........
CHAPTER -1
INTRODUCTION
holder.
Inculcates the habit of savings.
bothers
you,
then
Life
Insurance
is
the
answer.
Of course, under any circumstances, the loss of a loved one is a traumatic experience. But, if
9
your family is also left without sufficient money to meet basic living needs or prepare for future
goals, they will have to cope with a financial crisis at the same time. A Life Insurance plan
ensures that your family is financially secure even if tomorrow you are no longer around to care
for them.Life insurance, especially tailored to meet your financial needs:
strong
element
of
asset
appreciation.
The core benefit of life insurance is that the financial interests of ones family remain protected
from circumstances such as loss of income due to critical illness or death of the policyholder.
Simultaneously, insurance products also have a strong inbuilt wealth creation proposition. The
customer therefore benefits on two counts and life insurance occupies a unique space in the
landscape of investment options available to a customer.
begin
to
take
precedence.
Clearly, as your life stage and therefore your financial goals change, the instrument in which you
invest should offer corresponding benefits pertinent to the new life stage.
Life insurance is the only investment option that offers specific products tailor made for
different life stages. It thus ensures that the benefits offered to the customer reflect the needs of
the customer at that particular life stage, and hence ensures that the financial goals of that life
stage are met.
The table below gives a general guide to the plans that are appropriate for different life stages.
g Life Stage e
Young & Single
Children's education,
Asset creation and
protection
Planning for retirement &
asset protection
Health plans
Health Insurance
Sharing of risks
Cooperative device
Evaluation of risk
Payment on happening of a special event
The amount of payment depends on the nature of losses incurred.
The success of insurance business depends on the large number of people insured against
similar risk.
Insurance is a plan, which spreads the risk and losses of few people among a large
number of people.13
The insurance is a plan in which the insured transfers his risk on the insurer.
11
Insurance is a legal contract which is based upon certain principles of insurance which
includes utmost good faith, insurable interest, contribution, indemnity, causes proximal ,
subrogation, etc.
The scope of insurance is much wider and extensive.
Secondary functions:
1.Prevention of losses: - Insurance cautions businessman and individuals
to adoptsuitable device to prevent unfortunate consequences of risk by observing saf
etyinstructions.
2.Small capital to cover large risks: - Insurance relives the businessman from security
investment, by paying small amount of insurance against larger risks and uncertainty.
3.Contributes towards development of larger industries.
Other Function:
Means of savings and investment :Insurance companies are business houses. The product they
sell is financial protection. To succeed and survive, they must cover their costs, which include
payments to cover the losses of policyholders, as well as sales and administrative expenses, taxes
and dividends.
12
Life
Insurance
Corporation
(LIC)
for
investments
are
8%
of
GDP.
Till date, only 20% of the total insurable population of India is covered under various life
insurance schemes, the penetration rates of health and other non-life insurances in India is also
well below the international level. These facts indicate the of immense growth potential of the
insurance sector. The year 1999 saw a revolution in the Indian insurance sector, as major
structural changes took place with the ending of government monopoly and the passage of the
Insurance Regulatory and Development Authority (IRDA) Bill, lifting all entry restrictions for
private players and allowing foreign players to enter the market with some limits on direct
foreign ownership. Though, the existing rule says that a foreign partner can hold 26% equity in
an insurance company, a proposal to increase this limit to 49% is pending with the government.
Since opening up of the insurance sector in 1999, foreign investments of Rs. 8.7 billion have
poured into the Indian market and 21 private companies have been granted licenses.
Innovative products, smart marketing, and aggressive distribution have enabled fledgling private
insurance companies to sign up Indian customers faster than anyone expected. Indians, who had
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 life insurance industry in India grew by an impressive 36%, with premium income from new
business at Rs. 253.43 billion during the fiscal year 2004-2005, braving stiff competition from
private insurers. This report, Indian Insurance Industry: New Avenues for Growth 2012, finds
that the market share of the state behemoth, LIC, has clocked 21.87% growth in business at
Rs.197.86 billion by selling 2.4 billion new policies in 2004-05. But this was still not enough to
13
arrest the fall in its market share, as private players grew by 129% to mop up Rs. 55.57 billion in
2004-05 from Rs. 24.29 billion in 2003-04. Though the total volume of LIC's business increased
in the last fiscal year (2004-2005) compared to the previous one, its market share came down
from 87.04 to 78.07%. The 14 private insurers increased their market share from about 13% to
about 22% in a year's time. The figures for the first two months of the fiscal year 2005-06 also
speak of the growing share of the private insurers. The share of LIC for this period has further
come down to 75 percent, while the private players have grabbed over 24 percent.
There are presently 12 general insurance companies with four public sector companies and eight
private insurers. According to estimates, private insurance companies collectively have a 10%
share
of
the
non-life
insurance
market.
Though the focus of this market research report is on the potential growth on the Indian
Insurance Sector, it also talks about the market size, market segmentation, and key developments
in the market after 1999. The report gives an instant overview of the Indian non-life insurance
market, and covers fire, marine, and other non-life insurance. The data is supplied in both
graphical and tabular format for ease of interpretation and analysis. This report also provides
company profiles of the major private insurance companies.
The Indian Insurance Sector went through a full circle of phases from being unregulated to
completely regulate and then being partly deregulated which is the present situation. A brief on
how the events folded up is discussed as follows: The Insurance Act of 1938 was the first
legislation governing all forms of insurance to provide strict state controls over insurance
business. In 19th January, 1956, the life insurance in India was completely nationalized through
the Life Insurance Corporation Act of 1956. At that time, there were 245 insurance companies of
both Indian and foreign origin. Government accomplished its policy of nationalization by
acquiring the management of the companies. Bearing this objective in mind, the Life Insurance
Corporation (LIC) of India was created on 1st September, 1956 which has grown in leaps and
bounds henceforth, to become the largest insurance company in India. The General Insurance
Business
(Nationalization)
Act
of
1972
was
formulated
with
the
Insurance and United India Insurance which have their head quarters in four metropolitan cities.
The Insurance Regulatory and Development Authority (IRDA) Act of 1999 deregulated the
insurance sector in India and allowed the entry of private companies into the insurance sector.
Moreover, the flow of Foreign Direct Investment (FDI) was also restricted to 26 %of the total
capital held by the Indian Insurance Companies.
15
245 Indian and foreign insurance and provident societies are taken over by the central
government and nationalized. LIC formed by an Act of Parliament, viz. LIC Act,1956, with a
capital contribution of Rs. 5 chores from the Government of India.
norms.The other important norm is the expansion of the sanctioned investments category, which
would also include the mortgaged securities and the initial public offerings unlike previously
when these two were not included. The proposal would be submitted to the Insurance Regulatory
and Development Authority of India (IRDA) board for approval. The final draft was published in
the Gazette of the Central Government at the end of March 2008. The alterations would help in
developing the instruments of investment and provide flexibility for insurers. The alterations
would provide more margins pertaining to the investments in certificates of deposit issued by the
banks and term deposits.
At present the insurance companies may invest about 10% of its investment funds to a particular
sector. The Insurance Regulatory and Development Authority of India (IRDA) constituted a
working group in the year 2006 to probe the existing investment regulations and provide review
on
the
present
statutory
advices
and
the
trends
of
investments
for
insurance
about Rs. 75,000 crores in the segments of non- life and life insurance, during the first nine
months of 2007- 2008. Further, the business of insurance in the country is expected to increase
due to the growth in the categories of semi- urban and rural insurance and is expected to be
worth about US$ 60 billion by 2010. The major Indian Banks that are planning to enter the
insurance sector of the country are Union Bank, Federal Bank, Allahabad Bank, Bank of India,
Karnataka Bank, Indian Overseas Bank and Bank of Maharashtra. Further, there are a number of
banks that are planning to set up their own companies for insurance such as Bank of Baroda,
Punjab National Bank, and Dena Bank. Indian banks are planning to enter the insurance sector
on their own, without partnering with insurance companies due to several reasons. One important
reason is that they would get better dividends than the commission they would get by entering
into partnerships with other insurance majors. Moreover, this would help them to diversify from
the regular banking activity that they are involved in. The insurance companies have been
affected with the planning of Indian banks to foray into the insurance sector of the country. This
is due to the fact that the insurance companies are now unable to find banks with whom they can
enter into partnerships for the distribution of their products.
care institutions of India on detection of illness. Further, it also has provision for a free
telephonic medical helpline across India. The hospitalization is covered by "Medicash Plan",
which is meant to provide a fixed amount of cash benefit on a day-to-day basis during the entire
period of hospitalization of the insured. The Medicash Plan would also cover expenses for
admission in ICU, lump sum benefits against an unlimited number of surgeries and recuperation
benefits. The second plan of the newly launched health insurance of Max New York Life
Insurance, is the "Wellness Plan", which is a more attractive one and covers 'critical illness' like
cancer, alzheimers, heart ailments, liver disease, deafness, permanent disability, etc. The
Wellness plan covers thirty eight critical illnesses, which is the highest number of illness
covered under one insurance plan in India by any insurance company. The third health insurance
policy of Max New York Life Insurance is a term plus health protection plan known as "Safety
Net". Max New York Life Insurance Company is one of the fastest growing life insurance
companies in India and is the first life insurance company of India to be awarded with ISO
9001:2000 certification.
Life Insurers:
1. Max New York Life Insurance Co. Ltd.
2. HDFC Standard Life Insurance Company Ltd.
3. ICICI Prudential Life Insurance Company Ltd.
4. Om Kotak Mahindra Life Insurance Co. Ltd.
5. Birla Sun Life Insurance Company Ltd.
6. Tata AIG Life Insurance Company Ltd.
7. SBI Life Insurance Company Limited
8. ING Vyasa Life Insurance Company Private Limited
9. Allianz Bajaj Life Insurance Company Ltd.
10. MetLife India Insurance Company Pvt. Ltd.
11. Reliance Life Insurance Company Ltd.
12. Shriram Life Insurance Company Ltd.
13. Sahara India Life Insurance Company Ltd.
14. Bharti AXA Life Insurance Company Ltd.
15. Aviva Life Insurance Company Ltd.
COMPANY PROFILE:
Incorporated in Aug, 2000 HDFC Standard life is one of the leading private life insurance
companies in India. HDFC Standard Life is a joint venture between HDFC- Indias housing
finance company and Standard plc United Kingdoms savings and investment Company.
HDFC Ltd. holds 72.43% and Standard Life (Mauritius Holding) Ltd. holds 26% of equity in the
joint venture while the rest is owned by others. When we talk about company profile then HDFC
standard
life
insurance
company is targeting insurance sector. It is launching various type of insurance plan and product
which is enticing people to buy its plan. As a insurance company it focus mainly in the
20
recruitment of financial consultant and the whole company based on it because the aim of
company
is
toget business and sell lots number of policy and this work is done by
financial
consultant. HDFC Standard Life Vision and Values Vision of HDFCSL .The most successful and
admired life insurance company, which mean that we are the most trusted company, the easiest to
deal with, offer the best value for money, and set the standards in the industry. In short, The
most obvious choice for all For retention in the market and highest market share, we need
trustof our customer. The customer should trust on our policies, services,employs
and
they
should be friendly with us. It wants to live in the eye and heart of the customer. It wants to give
them the easiest deal so that they can be understood the terms and policies. As we know
that profit is the main aim of any business but it think not only about his profit but also profit of
the customer. It wants to be the choice of all people on the basis of trust of customer, delivering
high value to the customer, and deliver Of best value of the money.
OFFICES IN INDIA:
---Extensive branch network reach to customers
Dedicated Email team for resolution of email requests/queries
SMS Services for customers On the Move through SMS key words
Web based services enhanced for customers and channel partners
Constant evaluation and capture of Voice of Customer through renowned research agencies
for experience at various touch points
Drishti Our exclusive Customer Contact Center for customer queries
21
The Company believes that an active, well-informed and independent Board is necessary to
ensure the highest standards of corporate governance.
The Companys corporate governance practices are aimed at meeting the corporate governance
requirements as per the IRDA Corporate Governance Guidelines, besides good practices either
recommended by professional bodies or practised by leading companies in India. .
The following Corporate Governance Policy has been adopted by the Board of Directors to assist
the Board in the exercise of its responsibilities. This Policy is subject to future amendments or
changes, as may be necessary, in the light of the amendments in various regulations in force for
governance requirements.
Our Vision
'The most successful and admired life insurance company, which means that we are the most
trusted company, the easiest to deal with, offer the best value for money, and set the standards in
the industry'. In short, 'The most obvious choice for all'.
Our Values
23
24
Investment Plan: Popularly known as ULIP, an investment plan invests part of your savings in
equity or debt market as per your preference. The objective of investment plan is to give you
returns which easily beat the rising costs since the usual returns in a bank are extremely low.
ULIPs offered by HDFC Life are
Endowment Assurance Plan, SL Crest, SL ProGrowth Super II, SL ProGrowth Maximiser, SL
New Money Back Plan and Single Premium Whole of Life Insurance Plan.
Health Plan: Slightly different from health insurance, health plan provides cover for surgery
costs, critical illness. A lump sum is paid irrespective of actual hospital bill. Critical Care Plan
and
SurgiCare
Plan
are
HDFC
health
plan.
Distribution Network:
HDFC has wide distribution network with 568 branches and has over 200000 Financial
Consultants. HDFC Standard Life also has bancassurance partners- HDFC Bank, Saraswat Bank
and Indian Bank. HDFC products like HDFC SL Crest, HDFC SL Youngstar Super II, HDFC SL
ProGrowth Super II, HDFC SL Youngstar Super Premium and HDFC SL ProGrowth Maximiser
are
also
availableonline.
Financial Information:
The total premium earned for the half year ended September 30, 2010 was Rs 35,909 million.
The profit after tax for the same period is Rs 646 million. There have been 1,298 death claims
during the period out of which 1,045 claims were settled and 45 claims were rejected.
Marketing Campaigns:
HDFC Standard Life Insurance has taken dynamic steps as part of changing brand identity.
HDFC Standard life in order to connect to younger target market made a series of changes.
HDFC Standard life dropped the standard word from their
name to make it HDFC Life. HDFC Life also changed their logo depicting more energy,
exuberance, vibrancy, dependability in their brand. HDFC Life also pushed their tagline sar utha
25
ke jiyo with television commercial, radio ads, print and other communication mediums. The
tagline presents the idea of living life with dignity which can be achieved
through being self dependent and insurance is part and parcel of the same.
Distinctions:
HDFC Standard Life has been adjudged one of the Best Companies to
Work for in India in 2010. The company participated in the Great Places
to Work study for the first time and ranked first in the insurance category.
HDFC Standard Lifes YoungStar Super has been voted Product of the Year 2010 in the
'Insurance' category by more than 30,000 consumers nationwide across 36
markets. The consumer study on product innovation in India was conducted
by A C Nielsen, the leading global research firm.
HDFC Standard Life has received the CIO The Ingenious 100 2009 Award, for ATLAS (Agency Training Licensing and
Servicing System). Additionally, the company has received the
CIO 100 Security Award 2009 for pioneering LANDesk Management and Security
Suite security implementation and taking its security to a higher level of technological
excellence.
HDFC Standard Life has received the Diamond EDGE Award 2009 for its mobile
workforce portal - Consultant Corner. EDGE - Enterprises Driving Growth and
Excellence (using IT) is an initiative by the ,Network Computing magazine to identify,
recognize, and honor end-user companies in India that have demonstrated the best use of
technology to solve a business problem, improve business competitiveness, and deliver
quantifiable ROI to stakeholders.
3.5.ASSOCIATE COMPANIES:
1. HDFC Limited
2. HDFC Bank
26
OTHER COMPANIES:
PRODUCT OF HDFCSL:
As we know that lots of insurance plan are playing in the market of differentcompanies.
HDCFSL has launched various insurance plans which based onunit link plan. It invests the
investment
of
his
consumer
in
bank
in
27
these plans depends upon the consumer whether he wants totake more risk and more return or
less risk or less return. It has launchedseveral insurance plans which are thus in the table:1.Unit link pension plan
2.Unit linked pension plus
3.Unit linked enhanced life protection II
4. Unit linked young star plus II
5.Endowment assurance plan
6.Children plan
7.Money back plan
8.Single premium whole of life plan
9.Personal pension plan
10.Saving assurance plan
11.Assure plan
Products list:
Retirement/Pension Plan
Retirement/Pension Plan
Retirement/Pension Plan
Child Plan
Child Plan
Child Plan
Term Plan
Term Plan
Term Plan
Term Plan
HDFC SL Crest
Health Plan
Health Plan
HDFC SL CREST:
Guaranteed highest net asset value
(NAV) plans are gaining prominence in
the market. This is due to the fact that
they satisfy customer needs and offer a
new avenue for insurers to sell their
29
services especially after the implementation of the new guidelines. The new Ulip season has a
number of such plans.
HDFC SL CREST is a unique guaranteed highest NAV plan launched by HDFC Standard Life
Insurance. This is a short-term plan leaning more towards investment than insurance. The
premium payment term under the plan is limited to five years and the policy tenure is fixed for
10 years.
The plan offers two investment strategies, namely, free asset allocation and highest NAV
guaranteed option. The highest NAV fund guarantees a minimum of Rs 15 or highest NAV
during the initial seven years of the fund or the NAV on the date of maturity (whichever is
higher) to the policyholder. The free asset allocation strategy provides five investment options
(funds) for policyholders.
One can choose from equity, debt or balanced portfolio. For instance, blue chip and opportunity
are equity based, whereas short term and income funds are debt based. Those looking for a
balanced portfolio can opt for the balanced fund and highest NAV guaranteed fund.
30
Today, a 2-year MBA course at a premiere management institute would cost you nearly Rs.
3,00,000/- At a assumed 6% rate of inflation per annum, 20 years later, you would need almost
Rs. 9,07,680/- to finance your child's MBA degree.
An illustration of how education expenses could rise with passing time due to inflation. So, how
can you cope with these costs? Children's Plans help you save steadily over the long term so
that you can secure your child's future needs, be it higher education, marriage or anything else. A
small sum invested by you regularly can help you build a decent corpus over a period of time and
go a long way in providing your child a secured financial future alongwith.
31
They are:
32
Advantages:
Ideal way to secure your long-term financial goals and your family's financial
independence by giving a lump sum payment (basic Sum Assured plus any Bonus
Additions) on survival up to Maturity date
Provides invaluable protection to your family by way of lump sum payment in case of
unfortunate demise within policy term
Gives you the flexibility to customise your policy according to your needs by adding any
one of the 3benefit options available
33
You can choose to pay your premium as either Annually, Half-Yearly or Quarterly
depending on your convenience. You also have a range of convenient auto premium
payment options
Tax benefits under sections 80C, 80D and 10(10D) of Income Tax Act, 1961
FEATURES:
34
Advantages:
Choose plan options as per your needs i.e. Classic or Premier or Elite
Uninterrupted savings with Waiver & funding of premiums for next 3 years on the
following events
o
This plan provides valuable protection to your family in case you are not around. In case
of your unfortunate demise during the policy term, we will pay the greater of the Sum
Assured or your total fund value to your nominee.
On maturity, you can take the Fund Value at the prevailing unit prices as lump sum or you
can opt for settlement option. You can use the maturity benefit to fund your needs - be it
for child's education, travel, upgrading your entrepreneurship venture etc.
You have flexibility to make partial withdrawals to meet any unplanned expenses
Benefits of this planThe HDFC Unit Linked Enhanced Life Protection II gives
1) Valuable protection to your family in case you are not around
35
36
37
ORGANIZATION STRUCTURE:
38
COMPETITORS:
39
CHAPTER -2
CONSUMER PERCEPTION ON
LIFE INSURANCE
40
2.1 INTRODUCTION
Perception is the process by which organisms interpret and organize sensation to produce a meaningful
experience of the world. Sensation usually refers to the immediate, relatively unprocessed result of
stimulation of sensory receptors in the eyes, ears, nose, tongue, or skin. Perception, on the other hand,
better
describes
one's
ultimate
experience
of
the
world
and
That
experience,
or
percept,
is
the
joint
product
of t h e s t i m u l a t i o n a n d o f t h e p r o c e s s i t s e l f . R e l a t i o n s f o u n d b e t w e e n v a r i o u s
t yp e s o f stimulation (e.g., light waves and sound waves) and their associated
percepts suggest inferences that can be made about the properties of the perceptual
process; theories of perceiving then can be developed on the basis of these inferences.
Because
is not itself publicor directly observable (except)to the perceiver himself, whose percepts are give
n directly in experience), the validity of perceptual theories can bechecked only indirectly.
Historically, systematic thought about perceiving was the province of philosophy. Philosophical
interest in perception stems largely from questions about the sources and validity of what is called
human knowledge (epistemology). Epistemologists ask whether areal, physical world exists independently of
human experience and, if so, how its properties can be learned and how the truth or accuracy of that
experience can be determined. They also ask whether there are innate ideas or whether all experience
originates through contact with the physical world, mediated by the sense organs.
As a scientific enterprise, however,the investigation of perception has especiallydeveloped as part
of
the
larger
discipline
of
psychology.
For
the
most
part,
psychology bypasses the questions about perceiving raised by philosophy in favors of problems t
hatcan be handled by its special methods. The remnants of such philosophical
questions,h o w e v e r, d o r e m a i n ; r e s e a r c h e r s a r e s t i l l c o n c e r n e d , f o r e x a m p l e ,
w i t h t h e r e l a t i v e contributions of innate and learned factors to the perceptual process. Such
fundamental philosophical assertions as the existence of a physical world, however are taken for
granted among most scientific students of perceiving. Typically, researchers in perception simply
41
accept the apparent physical world particularly as it is described in those branches of physics
concerned with electromagnetic energy, optics, and mechanics. The problems they consider
relate to the process whereby percepts are formed from the interaction of physical energy (for example,
light) with the perceiving organism. Of further interest is the degree of correspondence between percepts and the
physical objects to which they ordinarily relate. In philosophy, psychology, and cognitive science,
perception is the process of attaining awareness or understanding of sensory information. The word
"perception"
comes
from
the
apprehension
with
the
mind or senses.
P e r c e p t i o n i s o n e o f t h e o l d e s t f i e l d s i n p s yc h o l o g y. T h e o l d e s t q u a n t i t a t i v e
l a w i n psychology is the Weber-Fetcher law, which quantifies the relationship between
theintensity of physical stimuli and their perceptual effects. The study of perception gave rise to
the Gestalt school of psychology, with its emphasis on holistic approach.
2.3.INTRODUCTION:
Consumer behavior is the process where the individual decides what, when, how and
from whom to purchase goods and services. Consumer behavior studies how
individuals, groups and organization select, buy, use dispose off goods, services,
ideas or experiences to satisfy their needs and desire. The study of consumer
behavior enables marketers to understand and predict consumer behavior in the
market place in advance and it is concerned not only with what consumers buy but
also with why, when, where, how and how often they buy it. Consumer research is
the methodology which is used to study consumer behavior and it takes place at
every phase of the consumption process during before and after the purchase.
Consumer behavior is inter disciplinary approach that is based on concepts and
theories about people that have been developed by scientists in diverse disciplines
such as psychology, sociology, social psychology, cultural anthropology and
economics. Consumer behavior has become an integral part of strategic and social
responsibility. It should also be an integral component of every marketing decision
embodied in a revised marketing and the social marketing concept. It helps
marketers to fulfill the needs of their target markets in such a way that it develops a
society. The insurance sector in India come a full circle from being an open
competitive market to nationalization and back to a liberalized market. Tracing the
developments in the Indian insurance sector reveals the 360-degree turn witnessed
over a period of almost 190 years. The business of life insurance started in India in
the year 1818 with the establishment of the Oriental Life Insurance Company in
Calcutta. Insurance may be described as a social device to reduce or eliminate risk of
life and property. Under the plan of insurance, a large number of people associate
43
themselves by sharing risk, attached to individual. The risk, which can be insured
against include fire, the peril of sea, death, incident, & burglary. Any risk contingent
upon these may be insured against at a premium commensurate with the risk
involved. Insurance is actually a contract between two parties whereby one party
called insurer undertakes in exchange for a fixed sum called premium to pay the
other party on happening of a certain event. Insurance is a contract whereby, in
return for the payment of premium by the insured, the insurers pay the financial
losses suffered by the insured as a result of the occurrence of unforeseen events. The
Indian insurance market is characterized by the presence of 'young pensioners', as
per an article in the 'Times of India'.
44
CHAPTER 3
RESEARCH METHODOLOGY
3.1.RESEARCH METHODOLOGY:
45
Data collection:
For data collection, I developed a well defined questionnaire as a research instrument, consisting
questions aimed to measure the consumer perception about insurance company in India, their
views and comments about Companys structure. I conducted unstructured interviews (sample
size) of 100 persons of different age group in time duration of three days. All the data generated
was primary data that was generated from different people of age group under NCR region.
Primary data:
Individual respondents, Chartered Accountants,Tax
Consultants, Insurance Agents, Auto loan providers were personally visited andinterviewed.
They were the main source of Primary data. The method of collection of primary data was direct
personal interview through a structured questionnaire.
Secondary Data:
It was collected from internal sources. The secondary data was collected on the basis
of organizational file, official records, newspapers, magazines, management books, preserved
information in the companys database and website of the company.
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The main aim of the research was to explore consumers attitudes to allowing insurance
companies to access results of genetic tests for the purpose of risk assessment and premium
setting. More specifically, the objectives of the research were:
Proper understanding and analysis of life insurance industry.
To know about brand awareness of HDFC Life Insurance and customers preference HDFC
Life Insurance.
Conduct market survey on a sample selected from the entire population and derive opinion on
that research.
To help company in establishing a network of Life Insurance Advisors and to promote the
benefits those are provided by HDFC Life Insurance.
To explore consumers understanding of life insurance companies use of different factors in
assessing risk.
To understand consumers attitudes to life insurance companies use of different factors in
assessing risk.
These factors included sex, age, smoking status, current and past health, family history of
cancer or heart disease, and genetic make-up.
To determine if the use of genetic test results by life insurance companies would deter
consumers from having such tests.
To explore consumer attitudes to disclosure of information to insurance companies.
47
Sampling plan
Since it is not possible to study whole population, it is necessary to obtain representative samples
from the population to understand its characteristics.
Sampling Units:
Individual respondents for studying Customer Buying Behavior and Market Segmentation,
selected randomly from different areas in NCR, like various shopping malls and markets,
Government Offices. Chartered Accountants, Tax Consultants, Lawyers, Business Men,
Professionals and House Wives of for recruitment of Life Insurance Advisors
Sample Technique:
Random Sampling
Research Instrument:
Structured Questionnaire
Contact Method:
Personal Interview
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Sample size
Study of Customer Buying Behavior and Market Segmentation: 100Respondents
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CHAPTER 4
FINDINGS & ANALYSIS
50
3. International companies will help in building world class expertise in local market by
introducing the best global practices.
4. Insurance liberalization in India is expected to result in a wider choice of major commercial
insurance covers, such as fire, export credit.
5.1.4. THREATS :
1. Legislation could impact.
2. Great risk involved
3. Very high competition prevailing in the industry.
4. Vulnerable to reactive attack by major competitors.
5. Lack of infrastructure in rural areas could constrain investment.
6. High volume/low cost market is intensely competitive.
5.2 Findings-Graphs
1. Market share of the key players in the life insurance sector in India:
Employed customers
The question was asked to that the policy holder is job holder or not?
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INTERPRETATION
It was founded that 83% customers who have taken the policy are job oriented.
2.BENEFIT OF INSURANCE:
What is the main cause of taking the life insurance policy?
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Future Security--59%
Tax Deductions--28%
Future Investment--13%
INTERPRETATION
The majority of consumer find it as future security followed by tax saving.
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INTERPRETATION
It was founded that majority of customer are not satisfied with their current policy.
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INTERPRETATION
After the survey it was found that still major portion of customers go for public
insurancecompanies, but with the entry of more and more private companies the scenario is
changingrapidly, people need of more and better returns are opting for private companies, and
thiscan be justified by the increasing market share of private companies in the Indian
insurancesector. There are various ways in which private companies are found much more
lucrativethan public companies and the fact which support this statement are as follows:
1.Versatility of products
2.Efficient fund managers
3.Better customer services
4.More returns
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5.Regular follow up
6.Quicker settlement
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INTERPRETATION
From the research it was found that there is a need for the private player to improvement
incertain sector to complete with the government sector companies, majority of the People
think that people think that private companies need to improve in easy claim andinformation.
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Explains about the types of insurance taken by consumer. About 20.20 % respondents have taken
vehicle insurance, 19.61 % respondents have taken term cover insurance, 14.6 % respondents
have taken medical/health insurance, purchase, 11.1 % respondents have taken personal accident
insurance, 10.60 % respondents have taken unit linked insurance plan and 7.13 % respondents
have taken pension plan etc.
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Explains about the total sum assured of life insurance for the spouses. About 695 respondents
having sum assured of life insurance for the spouses less than Rs 10 lakh, 132 respondents
having sum assured of life insurance for the spouses between Rs 10 lakh to Rs 20 lakh, 39
respondents having sum assured of life insurance for the spouses between Rs 20 lakh to Rs 50
lakh and 1067 respondents have not taken any sum assured life insurance for the spouses etc.
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The figure explains about the reason for investing in life Insurance. About 35.70 % respondents
have invested in life insurance due to higher risk coverage and 32.43% respondents have
invested in life insurance for tax saving.
Explains about the reasons for investing in life Insurance. About 35.70 % respondents have
invested in life insurance due to higher risk coverage, 32.43% respondents have invested in life
insurance for tax saving and 19.65 % respondents have invested in life insurance due to easy way
to invest.
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CHAPTER -6
CONCLUSION
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6.1.CONCLUSION:
HDFCSLIC is the renounce industry in the insurance sector. It believes in quality not in quantity.
HDFC have total 12 group companies. It is the first insurance company who has gotten the
license of insurance in firstly. It has started its insurance industry with the joint venture of U.K.
based standard life insurance company .In the insurance sector main work is done by the
financial consultant who brings business to the industry. It gives more priority for the recruitment
of financial consultant thats why it has setup 5-qscore. It gives priority that is professional like
as MBA, CA, ENGINEERS, DOCTORS,LAYERS, AND OTHER PROFESSIONAL. During
summer training I have given presentation in study centre of IGNOU and SIKKIM MANIPAL
and phone call, and try to contact those person to whom I know and contact them for the purpose
of financial consultant. In this process I have recruited 12 people who are either
CA,MBA, SOFTWARE ENGINEER, STUDENT, OR EMPLOY OF THEORGANISATION.It
gives more facilities to their employ and provides better opportunity to their employ for
promotion because it has minimum target for fulfillment. FC have to give 36 policy or 360 lack
premium with in six months which less in comparison to the other insurance industry and
for Delhi region where the transaction of money is too high. FC has chances to become sales
development manager with in six month months when he fulfills the target. The post of SDM is
based on payroll. He will get package of 2.75 lack per year. India is one of the most lucrative
financial services market in the world. The insurance market in India is estimated to be around
400Bn growing at an astounding rate of 30% p.a. Still the experts believe that the potential is
largely untapped. The insurance market is dominated by the public sector giant LIC with a
market share of around 71.4%. With the private players leading the growth story, this sector is
witnessing more marketing actions than even the FMCG sector. Traditionally insurance are sold
through direct selling The reason being purely the nature of product warrants direct
communication with the consumer. Kilter categorizes Insurance as an "Unsought" product.
Unsought products are those which are ranked lowest in terms of consumer interest .Consumers
may not be even aware of either the need or existence of this product. Historically, Indian
insurance products are sold for wrong reasons. People buy insurance to avail the tax benefit and
not to ensure protection and LIC was happy to oblige. Hence most of the sales talks start with the
question " How much do you pay tax?" . Little money was spent on brand building because
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there was no competition for LIC. Things have now changed. With the increasing financial
literacy, volatile economy and uncertain future are prompting Indians to look seriously at
insurance as a means for protection rather than tax saving instrument. With more private players
entering the domain, the issues of differentiation and branding became important. HDFC
Standard Life Insurance (HDFCSL) is one of the major players in theinsurance market. One of
the first private insurers to enter the market, HDFC SL entered the scene in 2000. It is a joint
venture between the housing finance major HDFC and the UK insurance giant Standard
Life. Now a days we are seeing a lot of media action from this company.Although a slow starter
HDFC SL was having a small share of the pie. It was eclipsed by ICICI prudential with its media
and sales blitz making it second largest player in the Insurance market. 2006 saw a shake up in
this market with Bajaj Allianz edging out ICICI from the second spot . Bajaj have a market share
of around 8% and HDFC SL and ICICI fighting at 3rd place with around 7.5%.HDFC is
currently focusing on The Pension Plan and the Child Plan aiming to cash in on the potential of
these segments. The pension market in India is estimated to be around 1000 crore with a huge
potential for growth in the future. The change in the demographics is going to drive the pension
market in India. Traditionally in a Joint family, there was an inherent protection for elders. With
the urbanization and the evolution of Nuclear Urban Family( NUF) , elders are often forgotten.
Out of the 314 men workers in India only 11% has some sort of old age security. People earlier
depend on social security products like EPF and PPF to build a corpus for their golden years. It is
this potential that has encouraged HDFC to promote its pension plans. Introduced in 2002, this
product has been well received by the consumers. The ads are well executed and revolve around
the positioning of "Respect Yourself" The target segment being the 30 year old family man. The
basic theme of the campaign is to appeal to the self respect of these men who are in their prime
of their career. "Even after retirement let your hands give rather than receive" is one of the best
themes for a pension plan. Since I am in that category, these ads strike a chord in me and remind
me of the need to plan for my retirement. The same theme is carried to the Child plan also.
Although these campaigns will help to invoke an interest in TG, the market is in its nascent stage
and lot of convincing has to be done to crack this huge market. One of the stumbling block being
the expensive annuity plans. For example, it takes a 2 lakh corpus to generate Rs 1000 per month
pension. Also if you put 10000 per month in a pension plan if you are 30 yrs old,
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what you will get after 20 years is a monthly pension of 10000. (Correct me if I am wrong). So it
looks unattractive in the first look compared to MFs. HDFC Standard Life has correctly
identified the pulse of the target market and is all set to reap the benefits.
With increase in population and income there is a wide scope in insurance sector. Insurance
sector provides some security to the consumer for any type of miss happening. In this sector,
IRDA plays an important role and time to time gives important guide lines to various companies.
Still, LIC plays an important role and has maximum share in this sector. Recently banking sector
has also moved towards insurance sector since they would get better dividends than the
commission they would get by entering into partnerships with other major insurance market
players. Union Bank, Federal Bank, Allahabad Bank, Bank of India, Karnataka Bank, Indian
Overseas Bank, Bank of Maharashtra, Bank of Baroda, Punjab National Bank, and Dena Bank
are planning to enter in this sector. Among private sectors Max New York insurance company
plays a vital role. There are various factors that affect the consumer buying decision and also
influence consumer thinking when they are planning to invest in insurance scheme .Major
respondents generally prefer insurance like vehicle insurance, term cover insurance,
medical/health insurance and they also prefer sum assured of life insurance less than Rs 10 lakh.
Most of the respondents show their interest in life insurance having higher risk coverage and also
for tax saving purpose.
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6.3.SUGGESTION:
When we talk about suggestion I think I have small experience of this sector but whatever I have
pointed out which are thus.
In the recruitment of financial consultant I found that mostly person dont want to give rs.925
or rs.825. I have faced some difficulties when they dont agree to give this much amount. If the
company willless this charge then it will get more FC.
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It should organize weakly meeting with FC for the business and give appraisal training to FC.
It works as a performance appraisal of the FC.
It should give monthly party to the FC for the attachment with the industry.
It should give canopy facility to CDM or RC for the recruitment of FC and if it will give
canopy facility to FC then they can give more facility.
Generally we buy only that thing whatever we see. It means that its hould spend more on
advertisement. Other insurance industry like LIC and ICICI advertise mostly through banner on
metro station, on road and advertise in the cinema hall. Add more and more movie hall for the
advertisement.
The role of recruitment is not easy so it should increase commission or give salary instead of
commission so that RC will take more interest in the recruitment on financial consultant.
Regular
canopy
should
be
established
such
areas
like
metro
Stations,college campus, and malls, supermarket, and hypermarket for the purpose of recruitment
FC and getting business form FC.
money,
greedy
about
fast
life
believesin speed join insurance because this sector gives you a platform for unlimited
and
earning
and life time earning like life time validity in mobile phone.
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7.QUESTIONNAIRE
7.Do You Own
O House
o Two Wheeler
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o Car
8. Do you have a Life Insurance Policy with any Life Insurance Company?
O Yes
o No
a)If yes, name the Company________________________________________________
b)Name the policy which you own___________________________________________
9. What factors do you consider while selecting a life insurance company?
O Premium Outflow
o Company Reputation
o Service Quality
o Product Quality
o Return on Investment
10.What factors influenced to select a Life Insurance company?
O Personal interest
o Friends
o Family
o Agents
o Advertisements
o Others
11. What is the value of your life insurance?
o>10,000
o10,000-25,000
o25,000-50,000
o50,000-1,00,000
o>1,00,000
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14. How do you rate the service offered by your Life Insurance Company?
oExcellent
oVery Good
oGood
oAverage
oPoor
15. Would you like to communicate the service offered by your Life Insurance Company
toothers?
oYes
o No
16. How many Life insurance Companies do you know?
o<5
o5-7
o8-10
o>10
17. How do you rate the following Life Insurance Companies?
oLIC
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oHDFC
oING Vysya
oMet life India insurance
oBirla sun life
oICICI Prudential
oTATA AIG
18. Would you like to continue with the same Life Insurance Company?
oYes
oNo
19. Any suggestions for improving the service offered by life insurance
companies ___________________________________________________________________
___________________________________________________________________ __________
_________________________________________________________ ____________________
___________________________________________
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