Bsli summer internship project1

G. L. BAJAJ
INSTITUTE OF MANAGEMENT & RESEARCH
Approved by A.I.C.T.E. & Affiliated to Dr. A.P.J. Abdul kalam Technical University,
Lucknow
Plot No. 2, Knowledge Park III, Greater Noida Uttar Pradesh-201308
SUMMER TRAINING PROJECT REPORT
ON
CUSTOMER SATISFACTION IN BIRLA SUN LIFE INSURANCE
Submitted for
partial fulfillment of the award of degree of Master of Business Administration (MBA)
From
Dr. A.P.J. Abdul kalam Technical University, Lucknow
UNDER THE SUPERVISION OF: SUBMITTED BY
Mr. Vinod Kumar Nitish Kumar Deo
(Branch Manager ) Roll no -1580170138
Birla sun life insurance ,Jharia Branch Session: (2015-17)
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STUDENT’S DECLARATION
I hereby declare that the survey, data collection and analysis work related to Summer Training
Project report titled “CUSTOMER SATISFACTION IN BIRLA SUN LIFE INSURANCE”
has been carried out exclusively on my efforts under the guidance of Mr. Vinod Kumar,
Branch Manager, Birla sun life insurance Jharia Branch, DHANBAD
I, further declare that this work was neither published nor submitted to any other institution for
award of any other degree or diploma.
(Signature)
Nitish Kumar Deo
Roll No. : 1580170138
Session: 2015-2017
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Acknowledgement
I take this opportunity to convey our sincere thanks and gratitude to all those who have directly
or indirectly helped and contributed towards the completion of this project.
First and foremost, i would like to thank my company Branch Manager Mr. Vinod kumar , for
his constant guidance and support throughout my summer training and this project. During the
project, I realized that the degree of relevance of the learning being imparted in the corporate
world and industry is very high. The learning in real enabled us to meet demands of corporate
world.
I like to thank my university for providing me with such a platform for corporate exposure. All
these have resulted in the enrichment of our real life experience and develop a network which
will be useful in enhancing our career prospects.
Special thanks to all my colleagues and staff at our outlet during my summer training for
providing their support and help in successful completion of my project.
NITISH KUMAR DEO
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PREFACE
To achieve partial and concrete results, it is necessary that theoretical knowledge must be
Supplemented with practical environment.
Keeping that view in mind I have completed my training work regarding ‘customer satisfaction
in Birla life insurance company’. By doing the research work I have learnt a lot of things which I
would be really helpful for me in future. The experience in decisions making and practical
application of knowledge has contributed greatly to my growth.
Sincerely,
Nitish Kumar Deo
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Executive Summary
The MBA course has its own unique syllabus which require its students to undertake any
Internship with any leading business houses for a period ranging form 6-8 weeks at the end
Of the second semester, the purpose of this internship is to enable the students to appreciate
And understand the practical world to the theoretical inputs with those of practical environment
In partial fulfillment of the MBA degree. I was given a project on ‘Customer Satisfaction In
Birla Sun Life Insurance Company’
I have learned a lot regarding the working of banks related to monitoring and noticed various
Problems which they face and are still facing during mentoring period; it was really great
Working with this prestigious organization of Birla Sun Life Insurance Company.
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ABSTRACT
The Insurance sector plays a vital role in the economic development of India. It acts as a
Mobilization of savings, financial intermediary, investment activities, risk manager and stabilizer
of financial markets. The insurance sector in India has come a full circle from being an open
competitive market to nationalization and back to a liberalized market. The Insurance sector
reforms were started with the incorporation of IRDA again in 2000. IRDA opened up the market
with the application for registration. Foreign companies were allowed ownership of upto 26%.
There is a proposal to increase the limit upto 49%. The key objective of the IRDA includes
promotion of competition and to enhance the customer satisfaction through increased consumer
choice and lower premium, while ensuring the financial security of the insurance sector. Though
as at end of September 2013, there were fifty two insurance companies operating in (forty four in
private sector and 8 in public sector). Life insurance industry recorded a premium income of Rs.
287202.49 crores in 2012-13 as against Rs. 287072.11 crores in 2011-12 registering a growth of
0.05 per cent. The life insurance industry reported a net profit of Rs. 6948 crores during the year
2012-13 as against of Rs. 5974 crores net profit during the year 2011-12. The public sector
companies reported a net profit of Rs. 2603 crores where as private sector insurance reported a
net profit of Rs. 679 crores during the year 2012-13.
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CONTENTS
Chapter page no.
1. Introduction of Insurance 10-22
2. Insurance in India 23-35
3. Company Profile 36-41
4. Product Profile 42-72
5. Indian Regulatory Development Authority (IRDA) 73-75
6. Research Methodology 76-79
7. Scope & Importance of Study 80-81
8. Review of Literature 82-89
9. Finding & Analysis (Q & A) 90-101
10. Conclusion 102
11. Suggestions 103-104
12. SWOT Analysis 105-106
13. Bibliography 107-108
14. Questionnaire 109-110
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Chapter 1- Introduction of insurance
Life Insurance
Life insurance or life assurance is a correct between the policy owner and the insurer,
where the insurer agrees to pay a designated beneficiary a sum of money upon the
occurrence of the insured individual’s or individuals’ death or other event, such as
terminal illness or critical illness. In return, the policy owner agrees to pay stipulated
amount at regular intervals or in lump sums . There may be designs in some countries
where bills and death expenses plus catering for funeral expenses should be included in
policy premium. In the united states, the predominant form simply specifies a lump sum
to be paid on the insured’s demise.
Life insurance is a type of insurance, as in all insurance, the insured transfers a risk to
the insurer. The insured pays a premium and receives a policy in exchange. The risk assumed
by the insurer is the risk of death of the insured.
HOW LIFE INSURANCE WORKED
There are three parties in a life insurance transaction; the insure, the insured, and the
owner of the policy (policyholder), although the owner and the insured are often the
same person. For example, if Raj kumar buys a policy on his own life, he is both the
owner and the insured, but if Rita kumari, his wife buys a policy on Raj life. She is the
owner and he is the insured. The owner of the policy is called the grantee. (he or she
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will be the person who will pay for the policy). Another important person involved is
the beneficiary. The beneficiary is the person or persons who will receive the policy
proceeds upon the death of the insured. The beneficiary is not a party to the policy, but
is designated by the owner, who may change the beneficiary unless the policy has an
irrevocable beneficiary designation. With an irrevocable beneficiary, that beneficiary must
agree to changes in beneficiary, policy assignment or borrowing of cash value.
The policy, like all insurance policies, is a legal contract specifying the terms and
conditions of the risk assumed. Special provisions apply, including a suicide clause where
in the policy becomes null if the insured commits suicide within a specified time for the
policy date (usually two years). Any misrepresentation by the owner or insured on the
application is also grounds for nullification. Most contracts have a contestability period,
also usually a two-year period; if the insured dies within this period, the insurer has a
legal right to contest the claim and request additional information before deciding to pay
or deny the claim.
The face amount of the policy is normally the amount paid when the policy matures,
although policies can provide for greater or lesser amounts. The policy matures when the
insured dies or reaches a specified age. The most common reason to buy a life
insurance policy is to protect the financial interests of the owner of the policy in the
event of the insured's demise. The insurance proceeds would pay for funeral and other
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death costs or be invested to provide income replacing the deceased's wages. Other
reasons include estate planning and retirement. The owner (if not the insured) must have
an insurable interest in the insured, i.e. a legitimate reason for insuring another person’s
life.
The insurer ( the life insurance company ) calculates the policy prices with an intent to
recover claims to be paid and administrative costs, and to make a profit. The cost of
insurance is determined using mortality tables calculated by actuaries. Actuaries are
professionals who use actuarial science which is based in mathematics (primarily
probability and statistics). Mortality tables are statistically based tables showing average life
expectancies.
The three main variables in a mortality table are age, gender, and use of tobacco. The
mortality tables provide a baseline for the cost of insurance. In practice, these mortality tables
are used in conjunction with the health and family history of the individual applying for a
policy in order to determine premiums and insurability. The current mortality table being
used by life insurance companies in the United States and their regulators was calculated
during the 1980s. There is currently a measure being pushed to update the mortality tables
by 2008.
The current mortality table assumes that roughly 2 in 1,000 people aged 25 will die
during the term of coverage. This number rises roughly quadratic ally to about 25 in
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1,000 people for those aged 65. So in a group of one thousand 25 year old males with
a $100,000 policy, a life insurance company would have to, at the minimum, collect
$200 a year from each of the thousand people to cover the expected claims. The
insurance company receives the premiums from the policy owner and invests them to
create a pool of money from which to pay claims, and finance the insurance company's
operations. Contrary to popular belief, the majority of the money that insurance
companies make comes directly from premiums paid, as money gained through
investment of premiums will never, in even the most ideal market conditions, vest
enough money per year to pay out claims. Rates charged for life insurance increase with
the insured's age because, statistically, a people are more likely to die as they get older.
Since adverse selection can have a negative impact on the financial results of the insurer, the
insurer investigates each proposed insured (unless the policy is below a company-established
minimum amount) beginning with the application, which becomes part of the policy. Group
Insurance policies are an exception. This investigation and resulting evaluation of the risk is
called underwriting. Health and lifestyle questions are asked, and the answers are dutifully
recorded. Certain responses by the insured will be given further investigation. Life insurance
companies in the United States support The Medical Information Bureau, which is a
clearinghouse of medical information on all persons who have ever applied for life insurance. As
part of the application, the insurer receives permission to obtain information from the proposed
insured's physicians. Life insurance companies are never required by law to underwrite or to
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provide coverage on anyone. They alone determine insurability, and some people, for their own
health or lifestyle reasons, are uninsurable. The policy can be declined (turned down) or rated.
Rating means increasing premiums to provide for additional risks relative to that
particular insured.
Group insurance policies are an exception. This investigation and resulting evaluation of the risk
is called underwriting. Health and lifestyle questions are asked, and the answers are dutifully
recorded. Certain responses by the insured will be given further investigation. Life insurance
companies in the United States support The Medical Information Bureau, which is a
clearinghouse of medical information on all persons who have ever applied for life insurance. As
part of the application, the insurer receives permission to obtain information from the proposed
insured's physicians. Life insurance companies are never required by law to underwrite or to
provide coverage on anyone. They alone determine insurability, and some people, for their own
health or lifestyle reasons, are uninsurable. The policy can be declined (turned down) or rated.
Rating means that the proposed insured has no adverse medical history is not under medication
for any condition, and his family (immediate and extended) has no history of early cancer,
diabetes or other conditions. Preferred is like Preferred Best, but it allows that the proposed
insured is currently under medication for the condition and may have some family history. Most
people are in the Standard category. Profession, travel, and lifestyle also factor into not only
which category the proposed insured falls, but also whether the proposed insured will be denied a
policy. For example, a person who would otherwise be in the Preferred Best category will be
denied a policy if he or she travels to a high risk country.
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Upon the death of the insured, the insurer will require acceptable proof of death before paying
the claim. The normal minimum proof is a death certificate and the insurer's claim form
completed, signed, and often notarized. If the insured's death was suspicious and the policy
amount warrants it, the insurer may investigate the circumstances surrounding the death, before
deciding whether there is a legal obligation to pay the claim.
Proceeds from the policy may be paid in a lump sum or as an annuity paid over time in regular
recurring payments for either for the life of a specified person or a specified time period.
What is insurance?
Insurance is a contract for reducing losses from accident insured by an individual party
through a distribution of the risk of such losses among a number of parties. It is a
system under which the insurer, for a consideration usually agreed upon in advance,
promises to reimburse the insured or to render services to the insured in the event that
certain accidental occurrences result in losses during a given period. It thus is a method of
coping with risk. Its primary function is to substitute certainty for uncertainty as regards the
economic cost of loss-producing events is concerned. Thus, in return for a specified
consideration, the insurer undertakes to pay the insured suffers loss through the
beneficiary some specified amount in the event that the “insurable risks” of a large
number of policyholders, the insurer is typically able to absorb losses incurred over any
given period much more easily than would the uninsured individual. Insurance relies
heavily on the “law of large numbers” in large homogenous populations it is possible to
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estimate the normal frequency of common events such as deaths and accidents. Losses
can be predicted with reasonable accuracy, and this accuracy increases as the size of the
group expands. From a theoretical standpoint, it is possible to eliminate all pure risk if
an infinitely large group is selected. The risks be such that pooling is both feasible and
advantages to the parties.
From the stand point of the insurer, an insurable risk must the following requirements:
1. The object to be insured must be numerous enough and homogenous enough to
allow a reasonably close calculation of the probable frequency and severity of
losses.
2. The insured objects must not be subject to simultaneous destruction. For example
if all the buildings insured by one insurer are in an area subject to flood, and a
flood occurs, the loss to the insurance underwriter may be catastrophic.
3. The possible loss must be accidental in nature and beyond the control of
insured. If the insured could cause the loss, the element of randomness and
predictability would be destroyed.
4. There must be some way to determine whether a loss has occurred and how great
that loss is. This is why insurance contracts specify very definitely what events
must take place, what constitutes loss, and how it is to be measured.
From the view point of the insured person, an insurable risk is one for which the
probability of loss is not so high as to require excessive premiums. What is “excessive”
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depends on individual circumstances including the insured’s attitude toward risk. At the
same time, the potential loss must be severe enough to cause financial hardship if it is
not insured against.
Insurable risks include:
Losses to the property resulting from fire, explosion, windstorm, etc.
Losses of life or health and the legal liability arising out of use of automobiles,
occupancy of buildings, employment or manufacture.
Uninsurable risks include:
Losses resulting from price changes and competitive conditions in the market.
Political risks such as war or currency debasement are usually not insurable by private
parties but may be insurable by government institutions. Very often contracts can be
drawn in such a way that an “uninsurable risk: can be turned into an “ insurable” one
through restrictions, on losses, redefinitions of perils or other methods.
Nature of insurance
Sharing of risk
Insurance is a device to share the financial losses which might be fall on an individual
or his family on tile happening of specified event. The event may be death, in case of
life insurance, marine insurance, marine perils, fire insurance and other certain events in
general insurance.
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Co-operative Device
The most important feature of every insurance plan is the co-operation of large number
of persons who agree to share the financial loss arising due to a particular risk which is
insured. All co-operative devices, there is no compulsion here on anybody to purchase
the insurance policy.
Value of the risk
The risk is evaluated before injuring the charge the amount of share of an insured, here
is called consideration or premiums. If there is expectation of more loss, higher premium
may be charged. So, the probability of loss is calculated at the time of insurance.
Payment of contingency
The payment is made at a certain contingency insured. If the contingency occurs, payment is
made. Since the life insurance is a contract of certainty, because the contingency, the death or
the expiry of term, will certainly occur the payment is certain.
Amount of payment
The amount of payment depends upon the value of loss occurred due to the particular
insured risk provided insurance is there up to that amount. In case of life insurance,
promises to pay a fixed bum on the happening of an even.( Either death or the expiry of
the term)
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Large number of insured persons
The co-operation of a small number of person may also be insurance but in tat case, the
cost of insurance to each number may be higher. In case of large number of persons
opposite condition is applicable.
Purpose of insurance
Insurance is a contract in which an insurer promises to pay the insured party a sum of money if
one or more specified events occurs in the future, in return for regular small payments - known
as premiums. It reduces your business' exposure to the effects of particular risks. These could
include:
1. Damage to, or the loss of, physical assets such as your premises or equipment
2. Illness or death of key members of staff
3. Compensation claims against the business or its directors by employees or customers
4. Business interruption caused by external events such as terrorism
5. Volatility and cash flow pressures following an incident
Basic function of insurance
The function of insurance can be bifurcated into three parts:
1. Primary functions
2. Secondary functions
3. Other function
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The primary functions of insurance can be bifurcated into three parts:
(i) Insurance provides certainty:
Insurance provides certainty of payment at the uncertainty of loss. The uncertainty of loss can be
reduced by better planning and administration. But, the insurance relieves the person from such
difficult task. Moreover, if the subject matters are not adequate, the self-provision may prove
costlier.
There are different types of uncertainty in a risk. The risk will occur or not, when will occur,
how much loss will be there? In other words, there are uncertainty of happening of time and
amount of loss. Insurance removes all these uncertainty and the assured is given certainty of
payment of loss. The insurer charges premium for providing the said certainty.
(ii) Insurance provides protection:
The main function of the insurance is to provide protection against the probable chances of loss.
The time and amount of loss are uncertain and at the happening of risk, the person will suffer
loss in absence of insurance. The insurance guarantees the payment of loss and thus protects the
assured from sufferings. The insurance cannot check the happening of risk but can provide for
losses at the happening of the risk.
(iii) Risk-Sharing:
The risk is uncertain, and therefore, the loss arising from the risk is also uncertain. When risk
takes place, the loss is shared by all the persons who are exposed to the risk. The risk-sharing in
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ancient time was done only at time of damage or death; but today, on the basis of probability of
risk, the share is obtained from each and every insured in the shape of premium without which
protection is not guaranteed by the insurer.
The Secondary functions of insurance includes the following:
(i) Prevention of Loss:
The insurance joins hands with those institutions which are engaged in preventing the losses of
the society because the reduction in loss causes lesser payment to the assured and so more saving
is possible which will assist in reducing the premium. Lesser premium invites more business and
more business cause lesser share to the assured.
So again premium is reduced to, which will stimulate more business and more protection to the
masses. Therefore, the insurance assist financially to the health organisation, fire brigade,
educational institutions and other organisations which are engaged in preventing the losses of the
masses from death or damage.
(ii) It Provides Capital:
The insurance provides capital to the society. The accumulated funds are invested in productive
channel. The dearth of capital of the society is minimised to a greater extent with the help of
investment of insurance. The industry, the business and the individual are benefited by the
investment and loans of the insurers.
(iii) It Improves Efficiency:
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The insurance eliminates worries and miseries of losses at death and destruction of property. The
carefree person can devote his body and soul together for better achievement. It improves not
only his efficiency, but the efficiencies of the masses are also advanced.
(iv) It helps Economic Progress:
The insurance by protecting the society from huge losses of damage, destruction and death,
provides an initiative to work hard for the betterment of the masses. The next factor of economic
progress, the capital, is also immensely provided by the masses. The property, the valuable
assets, the man, the machine and the society cannot lose much at the disaster.
The other function are:
1. Means of saving and investment.
2. Sources of earning foreign exchange.
3. Risk free trade.
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Chapter 2 – Insurance in India
In India, insurance has a deep-rooted history. It finds mention in the writings of Manu
( Manusmrithi ), Yagnavalkya (Dharmasastra ) and Kautilya ( Arthasastra ). The writings talk in
terms of pooling of resources that could be re-distributed in times of calamities such as fire,
floods, epidemics and famine. This was probably a precursor to modern day insurance. Ancient
Indian history has preserved the earliest traces of insurance in the form of marine trade loans and
carriers’ contracts. Insurance in India has evolved over time heavily drawing from other
countries, England in particular.
1818 saw the advent of life insurance business in India with the establishment of the Oriental
Life Insurance Company in Calcutta. This Company however failed in 1834. In 1829, the
Madras Equitable had begun transacting life insurance business in the Madras Presidency. 1870
saw the enactment of the British Insurance Act and in the last three decades of the nineteenth
century, the Bombay Mutual (1871), Oriental (1874) and Empire of India (1897) were started in
the Bombay Residency. This era, however, was dominated by foreign insurance offices which
did good business in India, namely Albert Life Assurance, Royal Insurance, Liverpool and
London Globe Insurance and the Indian offices were up for hard competition from the foreign
companies.
In 1914, the Government of India started publishing returns of Insurance Companies in India.
The Indian Life Assurance Companies Act, 1912 was the first statutory measure to regulate life
business. In 1928, the Indian Insurance Companies Act was enacted to enable the Government to
collect statistical information about both life and non-life business transacted in India by Indian
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and foreign insurers including provident insurance societies. In 1938, with a view to protecting
the interest of the Insurance public, the earlier legislation was consolidated and amended by the
Insurance Act, 1938 with comprehensive provisions for effective control over the activities of
insurers.
The Insurance Amendment Act of 1950 abolished Principal Agencies. However, there were a
large number of insurance companies and the level of competition was high. There were also
allegations of unfair trade practices. The Government of India, therefore, decided to nationalize
insurance business.
An Ordinance was issued on 19 January 1956 nationalising the Life Insurance sector and Life
Insurance Corporation came into existence in the same year. The LIC absorbed 154 Indian, 16
non-Indian insurers as also 75 provident societies—245 Indian and foreign insurers in all. The
LIC had monopoly till the late 90s when the Insurance sector was reopened to the private sector.
The history of general insurance dates back to the Industrial Revolution in the west and the
consequent growth of sea-faring trade and commerce in the 17th century. It came to India as a
legacy of British occupation. General Insurance in India has its roots in the establishment of
Triton Insurance Company Ltd., in the year 1850 in Calcutta by the British. In 1907, the Indian
Mercantile Insurance Ltd, was set up. This was the first company to transact all classes of
general insurance business.
1957 saw the formation of the General Insurance Council, a wing of the Insurance Association of
India. The General Insurance Council framed a code of conduct for ensuring fair conduct and
sound business practices.
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In 1968, the Insurance Act was amended to regulate investments and set minimum solvency
margins. The Tariff Advisory Committee was also set up then.
In 1972 with the passing of the General Insurance Business (Nationalisation) Act, general
insurance business was nationalized with effect from 1 January 1973. 107 insurers were
amalgamated and grouped into four companies, namely National Insurance Company Ltd., the
New India Assurance Company Ltd., the Oriental Insurance Company Ltd and the United India
Insurance Company Ltd. The General Insurance Corporation of India was incorporated as a
company in 1971 and it commence business on January 1sst 1973.
This millennium has seen insurance come a full circle in a journey extending to nearly 200 years.
The process of re-opening of the sector had begun in the early 1990s and the last decade and
more has seen it been opened up substantially. In 1993, the Government set up a committee
under the chairmanship of RN Malhotra, former Governor of RBI, to propose recommendations
for reforms in the insurance sector. The objective was to complement the reforms initiated in the
financial sector. The committee submitted its report in 1994 wherein, among other things, it
recommended that the private sector be permitted to enter the insurance industry. They stated
that foreign companies be allowed to enter by floating Indian companies, preferably a joint
venture with Indian partners.
Following the recommendations of the Malhotra Committee report, in 1999, the Insurance
Regulatory and Development Authority (IRDA) was constituted as an autonomous body to
regulate and develop the insurance industry. The IRDA was incorporated as a statutory body in
April, 2000. The key objectives of the IRDA include promotion of competition so as to enhance
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customer satisfaction through increased consumer choice and lower premiums, while ensuring
the financial security of the insurance market.
The IRDA opened up the market in August 2000 with the invitation for application for
registrations. Foreign companies were allowed ownership of up to 26%. The Authority has the
power to frame regulations under Section 114A of the Insurance Act, 1938 and has from 2000
onwards framed various regulations ranging from registration of companies for carrying on
insurance business to protection of policyholders’ interests.
In December, 2000, the subsidiaries of the General Insurance Corporation of India were
restructured as independent companies and at the same time GIC was converted into a national
re-insurer. Parliament passed a bill de-linking the four subsidiaries from GIC in July, 2002.
Today there are 28 general insurance companies including the ECGC and Agriculture Insurance
Corporation of India and 24 life insurance companies operating in the country.
The insurance sector is a colossal one and is growing at a speedy rate of 15-20%. Together with
banking services, insurance services add about 7% to the country’s GDP. A well-developed and
evolved insurance sector is a boon for economic development as it provides long- term funds for
infrastructure development at the same time strengthening the risk taking ability of the country.
Organizational structure
As per the section 4 of IRDA Act' 1999, Insurance Regulatory and Development Authority
(IRDA, which was constituted by an act of parliament) specify the composition of Authority
IRDA is a ten-member body consisting of
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• A Chairman - T.S. Vijayan.
• Five whole-time members - R.K. Nair, M. Ram Prasad, S. Roy Chowdhary, D.D. Singh
• Four part-time members - Anup Wadhawan, S.B. Mathur, Prof. V.K.Gupta, CA. Subodh
Kr. Agarwal
Note: All members are appointed by the Government of India
Competition
• Private companies with a minimum paid up capital of Rs. 1bn should be allowed.
• To enter the industry no company should deal in both life and general insurance
through a single entity.
• Foreign companies may be allowed to enter the industry in collaboration with the
domestic companies.
• Postal life insurance should be allowed to operate in the rural market.
Only one state level life insurance company should be allowed to operate in each state.
Regulatory Body
• The insurance Act should be changed.
• An insurance regulatory body should be set up.
Controller of insurance ( currently a part from the finance ministry ) should be made
independent.
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Invesment
• Mandatory investment of LIC life fund in government securities to be reduced
from 75% to 50%
• GIC and its subsidiaries are not to hold more than 5% in any company ( there
current holdings to be brought down to this level over a period of time )
Customer service
• LIC should pay interest on delays in payments beyond 30 days.
• Insurance companies must be encouraged to set up unit linked pension plans.
• Computerization of operations and updating of technology to be carried out in the
insurance industry. The committee emphasized that in order to improve the
customer services and increase the coverage of the insurance industry should be
opened up to competition. But at the same time the committee felt the need to
exercise caution as any failures on the part of new players could ruin the public
confidence in the industry.
Hence, it was decided to allow competition in a limited way by stipulating the minimum
capital requirement of Rs.100 crores. The committee felt the need to provide greater
autonomy to insurance companies in order to improve their performance and enable them
to act as independent companies with economic motives. For this purpose, it had proposed
setting up an independent regulatory body.
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Life Insurance Companies in India
Check Below 24 Life Insurance Companies with Their Insurance Claim Settlement Ratio
(2015-16)
List of Life Insurance Companies Claim Settlement Ratio
Aviva Life Insurance 95.30 %
Bajaj Allianz Life Insurance 82.00 %
Bharti AXA Life Insurance 91.30 %
Birla Sun Life Insurance 80.00 %
Canara HSBC OBC Life Insurance 88.45 %
DHFL Pramerica Life Insurance 92.99 %
Edelweiss Tokio Life Insurance 22.14 %
Exide Life Insurance 85.10 %
Future Generali India Life Insurance 83.16 %
HDFC Standard Life Insurance 90.61 %
ICICI Prudential Life Insurance 95.02 %
IDBI Federal Life Insurance 96.20 %
India First Life Insurance Company Ltd - India First 84.79 %
Kotak Life Insurance 73.13 %
Life Insurance Corporation of India 90.69 %
Max New york Life Insurance 98.14 %
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PNB MetLife Insurance 96.23 %
Reliance Life Insurance 92.90 %
Sahara Life Insurance 95.01 %
SBI Life Insurance 90.19 %
Shri ram Life Insurance 95.70 %
Star Union Dai-ichi Life Insurance 67.69 %
Tata AIA Life Insurance 92.86 %
Why Buy Life Insurance
Life Insurance is a financial cover for a contingency linked with human life, like death,
disability, accident, retirement etc. Human life is subject to risks of death and disability due to
natural and accidental causes. When human life is lost or a person is disabled permanently or
temporarily, there is loss of income to the household.
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Though human life cannot be valued, a monetary sum could be determined based on the loss of
income in future years. Hence, in life insurance, the Sum Assured ( or the amount guaranteed to
be paid in the event of a loss) is by way of a ‘benefit’. Life Insurance products provide a definite
amount of money in case the life insured dies during the term of the policy or becomes disabled
on account of an accident.
Why you should buy Life Insurance:
All of us face the following risks:
Dying too soon
Living too long
Life Insurance is needed :
• To ensure that your immediate family has some financial support in the event of your
demise
• To finance your children’s education and other needs
• To have a savings plan for the future so that you have a constant source of income after
retirement
• To ensure that you have extra income when your earnings are reduced due to serious
illness or accident
• To provide for other financial contingencies and life style requirements
Who needs Life Insurance:
Primarily, anyone who has a family to support and is an income earner needs Life Insurance. In
view of the economic value of their contribution to the family, housewives too need life
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insurance cover. Even children can be considered for life insurance in view of their future
income potential being at risk.
How much Life Insurance is needed:
The amount of Life Insurance coverage you need will depend on many factors such as:
• How many dependants you have
• What kind of lifestyle you want to provide for your family
• How much you need for your children’s education
• What your investment needs are
• What your affordability is
You should seek the help of an insurance agent or broker to understand your insurance needs and
suggest the right type of cover.
How to Buy Life insurance and From Whom
Insurance Intermediaries
• Insurance is a complex product representing a promise to compensate the insured or third
party according to specified terms and conditions in the event of the occurrence of a
covered contingency. In most insurance transactions there is usually an intermediary - an
insurance agent (individual or corporate) or an insurance broker.
• Insurance intermediaries serve as a bridge between consumers (seeking to buy insurance
policies) and insurance companies (seeking to sell those policies).
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• Insurance brokers are licensed by the IRDA and governed by the Insurance Regulatory
and Development Authority (Insurance Brokers) Regulations, 2002. Individual insurance
agents and corporate agents are also licensed by the IRDA and governed by the Insurance
Regulatory and Development Authority (licensing of Individual Insurance Agents)
Regulations, 2000 and the Insurance Regulatory and Development Authority (Licensing
of Corporate Agents) Regulations, 2002, respectively. These Regulations lay down the
Code of Conduct for the respective intermediaries.
• An intermediary has a distinct role to play in the entire life cycle of a product, from the
point of sale through policy servicing, up to claim servicing. An intermediary shall
provide all material information with respect to a proposed cover to enable the prospect
to decide on the best one. The intermediary is expected to advise the prospect with
complete disclosures and transparency. After the sale is effected, the intermediary must
coordinate effectively between the customer and the insurer for policy servicing as well
as claim servicing.
• IRDA has prescribed regulations for protecting the interests of policyholders casting
obligations not only on Insurers but also Intermediaries. These prescribe obligations at
the point of sale as well as policy servicing and claims servicing.
Tips on dealing with Insurance Intermediaries
• While dealing with Insurance Intermediaries, check out the following:
• Ask for and check whether the person holds a valid license and is authorized for the
particular business. For example the Intermediary should be licensed to sell life insurance
or general insurance or both (holding a composite license). A referral always helps.
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• Check whether he or she has a good knowledge of various insurance products/policies
• He or she should understand your needs and what you are seeking. Always ensure that
you consider only products that you can afford. Beware of tall promises and over-selling
tactics. Consider only what you can afford.
• Ask questions and understand the policy terms and conditions of the policy the
Intermediary is trying to explain to you.
• You must be satisfied that you understand what your commitments are. What are the
payments or amounts that you have to bear not only when you take the policy but when
you surrender it or when you make a claim.
• Ask for brochures and sales literature pertaining to the product you are considering or the
intermediary is trying to sell. Get the intermediary to explain the full facts of the
products, scope of cover and exclusions, as applicable.
• Insist on quality delivery and timely service. You can judge this by the turnaround time
of the intermediary during the period of pre-sale when he or she is dealing with you.
• Fill up the proposal form yourself. Never ever sign on a blank proposal form. If you find
terms in the proposal form that you do not understand, ask the intermediary to explain it
to you.
• When you make premium payments through an Intermediary, check whether heis
authorized to do so by the insurance company and insist on a duly signed receipt
immediately.
• After receipt of your policy, go through it thoroughly and if you do not understand certain
terms contact your intermediary and get them explained. Remember, for life insurance
and for health insurance policies of a term of three years or more, there is a free-look
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period within which you may return the policy if you do not agree with the terms and
conditions therein.
• Ask the intermediary questions about documents and procedures involved in making a
claim and understand them completely. In the event of a claim, there may be other
agencies you may have to intimate apart from the insurance company. Get complete
details about what you are expected to do.
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Chapter 3 - Company Profile
BIRLA SUN LIFE INSURANCE = ADITYA BIRLA GROUP ( INDIA) + SUN LIFE
FINANCIAL’S ( CANADA)
Birla Sun Life Insurance Company Limited (BSLI) is a joint venture between the Aditya Birla
Group and Sun Life Financial Inc., a leading international financial services organization. The
local knowledge of the Aditya Birla Group combined with the expertise of Sun Life Financial
Inc., offers a formidable value proposition to customers. Sun Life Financial and its partners
today have operations in key markets worldwide, including India, Canada, the United States, the
United Kingdom, Hong Kong, Philippines, Japan, Indonesia, China and Bermuda. Sun Life
Financial Inc. had assets under management of over US$ 386.82 billion, as on 31 March 2007.
Sun Life Financial Inc. is a leading performer in the life insurance market in Canada.
BSLI in its five successful years of operations 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 players in India. It was the first player in the industry to sell
its policies through the Bank assurance route and through the internet. It was also the first private
sector player to introduce a pure term plan in the Indian market. This was supported by sales
practices, which brought a degree of transparency that was entirely new to the market. The
process of getting sales illustrations signed by customers, offering a free look period on all
policies, which are now industry standards were introduced by BSLI.
Being a customer centric company, BSLI has invested heavily in technology to build world class
processing capabilities. BSLI has covered more than one and a half million lives since inception
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and its customer base is spread across 100 cities in India. All this has assisted the company in
cementing its place amongst the leaders in the industry in terms of new business premium
income. .
About Birla Sun Life Insurance
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., a leading international
financial services organization. The local knowledge of the Aditya Birla Group combined with
the expertise of Sun Life Financial Inc., offers a formidable protection for your future.
Birla Sun Life Insurance (BSLI), in its five successful years of operations, 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 players in India. It was the first
player in the industry to sell its policies through the banc assurance route and through the
internet. It was the first private sector player to introduce a pure term plan in the Indian market.
This was supported by sales practices which brought a degree of transparency that was entirely
new to the market. The process of getting sales illustrations signed by customers and offering a
free look period on all policies, which are now industry standards, were introduced by BSLI.
Being a customer-centric company, BSLI has invested heavily in technology to build world class
processing capabilities. BSLI has covered more than a million lives since inception and its
customer base is spread across more than 1000 towns and cities in India. All this has assisted the
company in cementing its place amongst the leaders in the industry in terms of new business
premium income. The company's current capital base is Rs.520 crore.
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About the Aditya Birla Group
The Aditya Birla Group has a turnover close to Rs.38,000 crore (as on 31 March 2008) and is
one of the largest business houses in India. It enjoys a leadership position in all the sectors in
which it operates. With over 75 business units spanning the South East Asian belt, Africa,
Canada and the UK among others, it is reckoned as India's first multinational corporation. The
group is anchored by 72,000 employees and has seven lakh shareholders, with a market
capitalization of Rs.53,400 crore.
About Sun Life Financial Inc.
Sun Life Financial Inc. is a leading international financial services organization providing a
diverse range of wealth accumulation and protection products and services to individuals and
corporate customers. Tracing its roots back to 1865, Sun Life Financial and its partners today
have operations in key markets worldwide, including Canada, the United States, the United
Kingdom, Hong Kong, the Philippines, Japan, Indonesia, India, China and Bermuda. As of 31
March 2008, the Sun Life Financial group of companies had total assets under management of
US$ 343 billion. Sun Life Financial Inc. trades on the Toronto (TSX), New York (NYSE) and
Philippine (PSE) stock exchanges under ticker symbol "SLF".
Key peoples of Organisation
Board of Directors
• Mr. Kumar M Birla
• Mr. Donald A Stewart,
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• Mr. Bishwanath N Puranmalka
• Mr. Ajay Srinivasan
• Mr. Gary M Comerford
• Mr. Suresh N Talwar
• Mr. Gian P Gupta
• His Highness Maharaja G Singh
• Mr. Stephan Rajotte
• Dr. Bharat K Singh
Investment Committee
• Mr. B. N. Puranmalka
• Mr. Eugene Lundrigan
• Mr. Ajay Srinivasan
• Mr. Vikram Mehmi
• Mr. Mayank Bathwal
• Mr. Fabien Jeudy
• Mr. Vikram Kotak
• Ms. Keerti Gupta
Management Team
Mr. Pankaj Razdan
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MD & Chief Executive Officer, Birla Sun Life Insurance
Dy. Chief Executive – Financial Services, Aditya Birla Group
Mr. Rajesh Nambiar
Chief Marketing Officer
Mr. Amit Jain
Chief Financial Officer
Mr. shashi krishnan
Chief Investment Officer
Ms. Shobha Ratna
Head – Human Resource & Training
Mr. Lalit Vermani
Chief Legal, Compliance & Risk Officer
Mr. Vikas Seth
Chief Distribution Officer (CDO)
Mr. Anli Singh
Chief Actuarial Officer
Mr. Rajesh Varrier
Chief Technology and Digital
Mr. Parag Raja
Deputy Chief Distribution Officer (Dy. CDO)
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Chapter 4 - Product Profile
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PRODUCTS
Life is unpredictable. But in face of adversity, our responsibilities towards our parents, children
and loved ones need not be compromised. Insurance planning equips you to smooth out the
uncertainties and adversities that life might send your way, so that the best that life has to offer,
secure in the knowledge that your beloved ones are well provided for. BSLI offers a complete
range of insurance products
1. Protection Plans
2. Savings Plans
3. Child Plans
4. Investment Plans
5. Retirement Plans
6. Group Plans
7. Rural Plans
Insurance Plans
BSLI offers Lifeguard - a set of pure protection plans. Choose from amongst three different
product structures to insure your life and provide total security to your family, at a very
affordable cost.
Level Term Assurance with return of premium
 On death the entire sum assured will be paid.
 On maturity, all the premiums paid will be returned.
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Level Term Assurance without return of premium
 No survival or maturity benefits.
You can also enhance the above two policies by adding Accident
& Disability Benefit Rider and Waiver of Premium Rider (WOP)
Level Term Assurance - Single premium:
 No survival or maturity benefits.
Protection Plans
BSLI offers a variety of policies that give you the benefits of protection and the opportunity to
save for important assets or events, like a home, a car or a wedding.
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A regular premium unit-linked insurance plan with an assurance of Capital Guarantee with the
added advantage of flexible liquidity option. An ideal plan for long term planning with the
benefit of liquidity.
The key features of the plan are:
 Flexibility to choose a specific level of protection (Sum Assured), based on a multiple of the
annual premium. You can also choose the term of the plan.
 At the end of the term, the higher of the value of units or the guaranteed value is paid. On
death, Sum Assured along with the higher of value of units or the guaranteed value is
payable.
 Facility to make withdrawals from the 6th policy year onwards till the end of the policy term.
Every year withdraw up to 10% of the value of units.
 Additional credits payable as a percentage of the initial annual premium are paid along with
the death or maturity benefit.
 Additional insurance for 10 years after the maturity, for an amount of 50% of the Sum
Assured
Savings Plans
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 Flexibility to make additional investment with the help of the top-up facility.
 Flexibility to increase / decrease your annual premium Amount
 Facility of Automatic Premium Payment- With this facility you can take a temporary break
from premium payment.
 Total transparency with the premium allocations, and other charges declared upfront.
 The guaranteed value of the unit fund is the value of all invested premiums (premiums net of
all charges) along with the declared bonus interests.
With Automatic Premium Payment facility, you can avail a temporary break from premium
payment for a maximum of 1 year. This facility is available once if the premium paying term is
less than 15 years and twice, if it is 15 years or more. You can also enhance your policy by
adding Accident & Disability Benefit Rider , Waiver of Premium Rider and Critical Illness Rider
.A regular premium unit-linked insurance plan with an assurance of Capital Guarantee# An ideal
plan for your long-term savings and protection requirement.
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The key features of the plan are:
annual premium. You can also choose the term of the plan.
 At the end of the term, the higher of the value of units or the guaranteed value is paid. On
death, Sum Assured along with the higher of value of units or the guaranteed value is payable
 Additional insurance for 10 years after the maturity, for an amount of 50% of the Sum
Assured.
 Flexibility to increase / decrease your annual premium amount
 Facility of Automatic Premium Payment- With this facility you can take a temporary break
from premium payment.
 Total transparency with the premium allocations, and other charges declared upfront. The
guaranteed value of the unit fund is the value of all invested premiums (premiums net of all
charges) along with the declared bonus interests.
With Automatic Premium Payment facility, you can avail a temporary break from premium
payment for a maximum of 1 year. This facility is available once if the premium paying term is
less than 15 years and twice, if it is 15 years or more.
The capital guarantee is applicable only on the invested premium and the declared bonus
interests. You can also enhance your policy by adding Accident & Disability Benefit Rider,
Waiver of Premium Rider and Critical Illness Rider.
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A unit-linked insurance plan with an assurance of Capital Guarantee which offers you the benefit
of a limited premium payment term. An ideal plan for protection with wealth creation that offers
the flexibility of a limited premium paying term.
 Flexibility to choose a premium payment term of 5, 7 or 10 years for a maturity term of 10,
15 or 20 years respectively.
annual premium.
 At the end of the term (maturity), the higher of the value of units or the guaranteed value is
paid. On death, Sum Assured along with the higher of value of units or the guaranteed value
is payable.
 Facility to make withdrawals from the 6th policy year onwards till the end of the policy term.
Every year withdraw up to 10% of the value of units
 Flexibility to increase / decrease your annual premium amount
 Total transparency with the premium allocations, and other charges declared upfront.
 The guaranteed value of the unit fund is the value of all invested premiums (premiums net of
all charges) along with the declared bonus interests.
 The capital guarantee is applicable only on the invested premium and the declared bonus
interests. You can also enhance your policy by adding Accident & Disability Benefit Rider
and Critical Illness Rider.
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 Presenting Premier Life – The Preferred plan for the Preferred Customer. The key features of
the plan are:
 Limited premium payment option: Choose from among a 3, 5, 7 or 10 year premium paying
term.
 Choice of sum assured: Choose a sum assured, which is a minimum multiple of 1 and a
maximum multiple of 25 times the annual contribution.
 Additional allocation of units on a periodic basis.
 Facility to top-up your investment any time you have surplus funds.
 Choose from among four funds, based on your investment objective and risk appetite.
Flexibility to decrease your sum assured.
 Add-on riders to protect you against any eventuality.
 Loans against the policy.
You can also enhance your policy by adding Critical Illness
Rider, Accident & Disability Benefit Rider.
Presenting Life Time – unit –linked plans that meet your changing needs
over a lifetime. These solutions have been developed to meet your savings, protection
and investment needs at every stage in life.
Protection
 Choose a specified level of protection (available only with Lifetime).
 Two levels of Sum Assured to choose from (available only with Lifetime II).
 Flexibility to increase or decrease your sum assured.
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 Add-on riders to protect you against any eventuality.
Savings
 Flexibility to increase or decrease your contribution.
 Facility of Premium Holiday, wherein the policy continues even if there is a temporary break
in the payment of annual contribution (available only with Life Time).
 Facility of Automatic Cover Continuance, wherein the policy continues even if there is a
temporary break in the payment of annual contribution
 Facility to top-up your investment any time you have surplus funds.
 Additional allocation of units on a periodic basis.
 Loans against the policy.
Investment:
 Choose from among four funds, based on your investment objective and risk appetite.
 Choice to switch between investments options (4 free switches every policy year).
You can also enhance your policy by adding Critical Illness Rider, Major Surgical Assistance
Rider, Accident & Disability Benefit Rider, Accident Benefit Rider (available only with Life
Time) and Waiver of Premium Rider. An insurance plan that gives added protection, savings
and multiple options, all in one!
 The flexibility to choose your premium contribution.
 The flexibility to choose amongst three levels of cover (in the form of sum assured) for the
same amount of total annual contribution.
 The flexibility of shifting between the three levels of cover, as you require.
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 The flexibility of receiving your maturity proceeds as a lump sum or in equal annual
installments over 3 or 5 years.
You can also enhance your policy by adding Variety of Riders An insurance plan that gives
you added protection, savings, multiple options, plus the power of liquidity.
 The flexibility to choose your premium contribution.
 The flexibility to choose amongst three levels of cover (in the form of sum assured) for the
same amount of total annual contribution.
 The flexibility of shifting between the three levels of cover, as you require.
 The flexibility of receiving your maturity proceeds as a lump sum or in equal annual
installments over 3 or 5 years.
 The flexibility of withdrawing up to 10% of the accumulated value of your policy, after the
first 5 policy years.
You can also enhance your policy by adding Variety of Riders An ideal plan for those who
want to accumulate funds on a regular basis while enjoying insurance protection.
 Guaranteed Benefits: Guaranteed additions @ 3.5% of the Sum Assured, compounded
annually for the first 4 years of the policy.
 Extended Life Cover: An extended cover for 5 years after the maturity of the policy, for
50% of the sum assured, at no extra cost.
 Maturity Benefit: At the end of the term, the policyholder receives the full sum assured, the
guaranteed additions and the vested bonuses.
 Death Benefit: The beneficiary receives the sum assured, the guaranteed additions and the
vested bonuses in case the life assured were to meet with an unfortunate event. In case the life
assured is aged 7 years or less, the basic premium paid will be returned.
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You can also enhance your policy by adding Critical Illness Rider, Major Surgical Assistance
Rider, Accident & Disability Benefit Rider, Waiver of Premium Rider (WOP) As a responsible
parent, you will always strive to ensure a hassle-free, successful life for your child. However, life
is full of Uncertainties and even the best-laid plans can go wrong. Here’s how you can give your
child a 100% safe and assured tomorrow, whatever the uncertainties. Smart Kid is especially
designed to provide flexibility and safeguard your child’s future education and lifestyle, taking
all possibilities into account. Choose from amongst a basket of 4 plans:
 Smart Kid regular premium
 Smart Kid unit-linked regular premium
 Smart Kid unit-linked regular premium II
 Smart Kid unit-linked single premium II
CHILD PLANS
All these plans offer you:
 Financial Benefits: Regular payments at critical stages in your child’s life, like Board
examinations, Graduation and Post-graduation.
 Total peace of mind, even if you are not around
 Sum Assured is paid immediately: Ensures that your loved ones stay financially secure,
even in your absence.
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 All future premiums are waived: Ensuring that your family is not financially burdened in
your absence.
 Policy benefits continue: The educational benefits of the policy continue, ensuring that your
child can realize his or her dreams without any hassles.
 Development Allowance: Smart Kid guarantees regular income to secure your child’s
educational career and also ensures his or her all-round development, for a nominal additional
amount. The Income Benefit Rider takes care of this through an annual payment of 10% of
the sum assured, to your child, till the maturity of the policy, in the unfortunate event of the
death of the parent. All Smart Kid plans can be enhanced with the Accident & Disability
Benefit Rider and Income Benefit Rider . You can also an Accident Benefit Rider to a
Smart Kid Regular Premium policy, and a Waiver of Premium Rider (WOP) to Smart Kid
unit-linked regular premium policy.
Life Link II is a unique plan that combines the security of a life insurance policy with the
opportunity of enjoying high returns on your investments, without the market
risks compromising on the protection of your family!
Death Benefit: The Sum Assured under the product has 2 options, either 500% of the initial
premium or 105% of the initial premium. In the event of an unfortunate death, the beneficiary
will receive higher of the value of units or the initial death benefit, less any withdrawals.
Withdrawal Benefit: One can make partial withdrawals from the accumulated value of the
policy after completion of one policy year.
Flexibility: Choose from four fund options, based on your investment objective and risk
appetite. If at a later stage your financial priorities change, you can switch between the various
fund options, absolutely free, 4 times a year
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Investment Plans
Life Expectancy has been rising rapidly and today you can expect to live longer than your earlier
generations. For you, this increase will mean a longer retirement life, stretching into a couple of
decades. BSLI Retirement Solutions that combine the best of insurance and investment. These
solutions are developed to ensure your peace of mind for the years to come.
1. Why plan for retirement?
2. How much should I set aside for retirement?
3. The impact of inflation on your retirement savings
4. Why plan early?
5. About annuities
Why plan for retirement?
For too many people, the joy of retirement after years of hard work is eclipsed by the financial
uncertainties that it brings. Despite all the planning and saving, you can never sure whether your
money will last a lifetime. Retirement planning offers a way to ensure a more enjoyable, stress
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free tomorrow. A prudent plan will ensure that increasing life expectancy, higher inflation and
increasing taxes do not eat away into your hard earned savings.
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Retirement Plans
How much must I set aside for retirement?
To ensure a comfortable retired life, you would be wise to invest money into additional avenues
like pension plans. How much you need to invest can be answered by answering some questions
such as:
1. How long do you have to save that amount before retirement?
2. Where can you invest your retirement money?
3. How much risk are you willing to take on your investments?
In an era of competitive parity, the only asset that makes a decisive difference between corporate
success and failure is the quality of human capital. Employee benefits have proven to be an
excellent tool to optimize the retention of talent and improve an organization’s bottom-line. The
quality of an organization’s employee benefits establishes and maintains a company's image as a
caring employer. Optimum care of employees is a long-term investment that results in a
sustained competitive advantage for an organization in the times to come.
BSLI Group Solutions Advantage:
 An integrated basket of employee benefits solutions that offer incomparable flexible benefits.
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 Sound investment management that focuses on safety, stability and profitability of the
portfolio.
 Personalized financial planning for your employee that takes care of his/her changing
financial needs at every stage of life.
 Quality service initiatives and transparency across all operations, promising superlative
operational efficiency.
Group Solutions
Group Term Assurance: Helps provide affordable cover to members of a group.
Group Gratuity Plan: Helps employers fund their statutory gratuity obligation in a flexible and
hassle-free manner.
Group Superannuation Plan: A flexible scheme (defined benefit and defined contribution) to
provide a retirement kitty for each member of the group.
Group Term Assurance:
BSLI flexible group term solution helps provide affordable cover to members of a group. The
cover could be uniform or based on designation/rank or a multiple of salary, and can be extended
to all employees between the ages of 18 and 65 years.
The benefit under the policy is paid on the event of the member’s death to the beneficiary
nominated by the member. It is a one-year renewable policy where one master policy covers all
proposed employees comprising the group, with a minimum group size of 25 persons. New
members can join the group and outgoing members can leave the group at any point during the
policy term.
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Highlights include:
 Greater convenience for the employees with relaxed underwriting and medical
requirements.
 "Free Cover Limits" with simplified underwriting depending upon the number of
employees in the group and the level of cover chosen.
 Guaranteed benefit: On death during the term of the contract (while in Service), the sum
assured will be paid to the beneficiary of the employee.
 Choice of additional coverage in form an Accident and Disability Benefit Rider and Critical
Illness Cover
 Premium is viewed as a business expense in the year of payment.
Group Gratuity Plan:
BSLI group gratuity plan helps employers fund their gratuity obligation in a scientific manner.
Employers can avail of the tax benefits as applicable to approved gratuity funds. The plan can
also be customized to structure schemes that can provide benefits beyond the statutory
obligations. Highlights include:
 Wider choice of investments with Market Linked Plans - to meet the diverse financial
goals. We offer 4 investment options (short-term debt, debt and balanced and capital
guarantee plan) where investments will be made in accordance with the fund objectives.
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 Transparency through Daily disclosure of Unit Value and regular disclosure of the portfolio
of each of the investment option
 Flexibility through switching and contribution redirection option to enable reshuffling of
portfolio
 Bundled Life Cover greater value to the employee by packaging life insurance covers with
the gratuity, with minimal amount of underwriting.
 Actuarial services to provide a scientific estimation of the gratuity liability.
 Low explicit charge structure with the conditions for exit specified upfront.
 Enhanced service levels through faster claim settlement, easier access to information and
regular statements.
 Complete end to end solution in the legal and regulatory approval process for scheme set up or
transfer
Employee Benefits:
 The contribution made by the employer is not included in the value of taxable perquisites in
the hands of the employee.
 Gratuity received up to Rs 350000 is exempt from Income tax under Sec 10(10)
 Annual contribution up to 8.33% of salary bill in a financial year is allowed a deduction for the
purpose of computation of profits and gains of business.
 Contribution towards past service liability is allowed as deduction as per the Income Tax rules.
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Group Superannuation Plan:
BSLI Superannuation Scheme (for both Defined Benefit and Defined Contribution funds)
offers substantial benefits to both employers and employees. The employer and employee can
avail of tax benefits applicable to an approved superannuation trust. The scheme will provide for
a retirement fund for each participating employee. An employee would be able to choose from
various annuity options or opt for partial commutation of corpus at retirement.
Highlights include:
 Wider choice of investments with Market Linked Plans – to meet the diverse financial
goals. We offer 5 investment options (short-term debt, debt, balanced, growth and capital
guarantee plan) where investments will be made in accordance with the fund objectives.
 Control - Each member/employer can exercise greater control over investments by choosing
one or more of the investment options.
 Multiple Annuity Options - 5 annuity options and open market option
 Transparency - Transparency through Daily disclosure of Unit Value and regular disclosure
of the portfolio of each of the investment option
 Flexibility - Flexibility through switching and contribution redirection option to enable
reshuffling of portfolio
 Low explicit charge structure with conditions for exit specified upfront.
 Enhanced service levels through faster claim settlement, easier access to information and
regular statements.
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 Complete end to end solution in the legal and regulatory approval process for scheme set up
or transfer BSLI Rural Products are designed to meet the needs of the rural consumers. These
products offer the following features:
1. Low and Affordable Premiums
2. Life Cover
3. Savings Option
4. Hassle free procedure
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Rural Solutions
India's rural hinterland teems with most of the country's population. In several areas of the
country's villages, basic infrastructure for travel, food, health and banking have still not reached
the masses. As compared to their urban counterparts, the rural masses have lower access to the
tools and remedies that make life much easier.
Hence, the risks associated with poor health and life expectancy are magnified and mostly,
unaccounted for. Hence, Birla Sun Life Insurance launched a unique rural life insurance
programed in the year 2001 to provide a much-needed bouquet of insurance products to the
villages of India. There are four rural insurance plans currently being offered, including an
endowment product that provides life coverage and returns on the maturity of the plan. This is an
extremely popular policy and has been well received all over the country.
Buoyed by interest and the response to its plans, Birla Sun Life Insurance launched two micro
insurance products in 2008 which provide a return of premium and also a pure term plan.
Plan Benefit Plan Name
This plan provides the security of life insurance cover and
also guarantees the refund of premiums paid by you on
maturity.
BSLI Bima Dhan Sanchay
A simple and convenient life insurance plan with no
medical tests and minimum documentation that helps you
secure your family’s future.
BSLI Bima Suraksha Super
A three year plan with death, maturity and surrender
benefits designed especially for the rural population.
BSLI Bima Kavach Yojana
The plan is designed to cater protection needs of rural BSLI Grameen Jeevan Raksha Plan
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masses as well socially weaker sections from semi
urban/urban areas. It is a simple pure term insurance plan.
BSLI Bima Dhan Sanchay
This plan provides the security of life insurance cover and also guarantees the refund of
premiums paid by you on maturity.
How Plan works
It is your hard work and determination that brings happiness to your loved ones. You have given
your family a comfortable life and always tried to fulfill their needs and requirements. But have
you ensured your family’s happiness in your absence also?
Apart from giving them a secured life today, it is your responsibility to secure their future too so
that they can meet financial requirements like repayment of loan, your daughter’s marriage or
your child’s education.
All your worries come to end with Birla Sun life Insurance Bima Dhan Sanchay on your side.
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BSLI Bima Dhan Sanchay ensures your family’s security in your absence.
A Win-Win Situation
Security plus Guarantee. The refund of premiums paid by you is guaranteed with 3 maturity
options.
Birla Sun Life Insurance Bima Dhan Sanchay apart from providing the security of life insurance
cover also guarantees the refund of premiums paid by you on maturity.
Thus BSLI Bima Dhan Sanchay provides a win-win situation
This plan is simple and convenient with no medical tests and minimum documentation.
Features & Benefits
• Eligibility criteria BSLI Bima Dhan Sanchay
You have an option to choose from three benefit periods –5,10 and 15 yrs.
Entry Age (Years) Term
18-60 5 years
18-55 10 years
18-50 15 years
The total sum assured under all the policies for the life insured shall not exceed Rs 50,000.
• Sum Assured Rs.5,000/- to Rs.50,000/
• Maximum Maturity age 65 years
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• Premium
You may pay your premiums by cash, credit card, salary deduction, ECS, Demand Draft, direct
debit, etc. You also have a choice to pay your premiums yearly, half yearly, quarterly or
monthly. Monthly mode will be through ECS/Demand Draft only.
• Premium Paying Mode
You may pay your premiums by cash, credit card, salary deduction, ECS, Demand Draft, direct
debit, etc. You also have a choice to pay your premiums yearly, half yearly, quarterly or
monthly. Monthly mode will be through ECS/Demand Draft only.
BSLI Bima Kavach Yojana
A three year plan with death, maturity and surrender benefits designed especially for the rural
population.
• How Plan works
Birla Sun Life Insurance belives in undertaking concerted efforts in the direction of helping the
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economically weaker section of the society. We have designed 'Birla Sun Life Insurance Bima
Kavach Yojana' plan keeping in mind the paying capacity and the needs of the rural population.
We are working in close coordination with the Aditya Birla Group Units and various N.G.O's,
located across India to provide the rural insurance services to the rural population.
Rural and Community Initiatives : The group is committed for sustainable social and
economic development of the weaker sections of the society, through need - based activities on
income generation and Skill enhancement, Micro Credit and Micro Finance, Savings, Health and
Family Welfare, Education, Watershed development etc.
The Plan
It is a three year plan. Premium is paid only once in 3 years. It has three benefits
• Death
• Maturity
• Surrender
Birla Sun Life Insurance Bima Kavach Yojana
Eligibility
Rural people between the age of 18 years to 50 years are
eligible for this plan
How much do you pay
A fixed one-time payment of Rs.50/- or Rs.100/- or Rs.200/-
as per the paying capacity of the rural mass.
Duration of the plan 3 years
Benefits
• Death Benefit
In case of an untimely death of the policy holder during the policy period, the nominee of the
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policy holder will get 100 times of the premium amount paid.
• Maturity Benefit
On Maturity, the policy holder will get his premium back with 10% bonus(1.10 times).
• Surrender Benefit
Under this plan if policy holder wishes to surrender his policy, he will get following surrender benefits.
On Surrender
In 1st year of policy Only Premium amount
In 2nd policy year 1.04 times of Premium amount
In 3rd policy year 1.08 times of Premium amount
Features
• Any time surrender facility
• No special medical checkup required
• Simple Application form and easy documentation process
General Exclusion
If the life insured dies during the duration of plan, the cause of death being suicide, we will not pay the normal
death benefit but will refund the amount paid by you as premium.
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Who are eligible?
People living in the IRDA Defined villages. Based on the following IRDA guidelines we have
prepared a list of villages qualify for sale of Above Rural Policy. Aged between 18 and 50.
IRDA Guidelines
The IRDA guidelines define a Rural village as one in which
• The total population is not exceeding 5000.
• The density of population is not more than 400/sq.km.
• At least 25 % of the male population is dependent on agriculture as source of livelihood.
BSLI Bima Suraksha
A simple and convenient life insurance plan with no medical tests and minimum documentation
that helps you secure your family’s future.
How Plan works
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It is your hard work and determination that brings happiness to your loved ones. You have given
your family a comfortable life and always tried to fulfil their needs and requirements. But have
you ensured your family's happiness in your absence also?
Apart from giving them a secured life today, it is your responsibility to secure their lives in your
absence also so that they can meet financial requirements like repayment of loan, your daughter's
marriage or your child's education.
All your worries come to end with Birla Sun life Insurance Bima Suraksha Super on your side.
Birla Sun life Insurance Bima Suraksha Super ensures your family's security in your absence.
• What is BSLI Bima Suraksha Super?
BSLI Bima Suraksha Super provides your life insurance cover for which you have to pay regular
premium. The nominee gets the sum assured in the unfortunate event of death.
This plan is simple and convenient with no medical tests and minimum documentation.
Features & Benefits
• Eligibility criteria BSLI Bima Suraksha Super
You have an option to choose from three benefit periods – 5,10 and 15 yrs.
Term Entry Age (Years)
5 years 18-60
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10 years 18-55
15 years 18-50
• Sum Assured Rs.5,000/- to Rs.50,000/-
The total sum assured under all the policies for the life insured shall not exceed Rs 50,000.
• Maximum Maturity age 65 years
BSLI Grameen Jeevan Raksha Plan
The plan is designed to cater protection needs of rural masses as well socially weaker sections
from semi urban/urban areas. It is a simple pure term insurance plan.
• How Plan works
The plan is designed to cater protection needs of rural masses as well socially weaker sections
from semi urban/urban areas. It is a simple pure term insurance plan.
Entry Age 18 – 50 years
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Premium Min: Rs. 250 | Max: Rs. 2,500 (in multiples of Rs. 50)
Sum Assured 20 x Single Premium
Policy Term 5 years
Premium Paying Term Single
Death Benefit Sum Assured
Maturity Benefit NIL
Surrender Benefit
Available from second to the forth policy year. The Surrender Benefit
as a % of single premium is –
Year of surrender 2nd 3rd 4th
% of single premium 60% 40% 20%
Tax Benefits*
Death Benefit is tax free under Sec. 10(10D) of the income Tax Act.
Tax benefit under Sec. 80C of the income Tax Act.
Free Look Period
15 days (30 days in case the policy issued under the provisions of
IRDA Guidelines on Distance Marketing^ of Insurance products) from
the date of receipt of the policy
This policy is underwritten by Birla Sun Life Insurance Co Ltd, Birla Sun Life Insurance,
Grameen Jeevan Raksha are names of Company & Product and do not in any way indicate the
quality of the policy. For more details on risk factors, terms & conditions please refer to sales
brochure carefully before concluding the sale. . Tax benefits are subject to change in tax laws.
All terms & conditions are guaranteed thought the policy term. Service tax & education cess and
any other applicable taxes will be added to your premium and levied as per extant tax laws.
Insurance is a subject matter of solicitation. UIN: 109N086V01.
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Chapter – 5 Indian Regulatory Development Authority
IRDA:
The insurance sector has been opened up in India, as there was an urgent need. The international
experience indicates those country with a liberalized insurance sector have witnessed a rapid
growth in premium volumes enhancing the domestic saving rate. This happened in China,
Malaysia and Singapore where a competitive market has led to improvement in Services and
quicker settlement of claims. It is also important to note that competition will bring about
advancement in information, communication and technology. And rightly therefore a decision
was taken by the Government of India to open up Insurance sector. The establishment of IRDA
in the month of April 2000 has been important development in this direction, making the end of
monopoly in the insurance sector.
WHY INSURANCE IN INDIA:
 Only 22% of the insurance population has been extended cover. Market penetration is low
and the potential to exploit is high.
 Insurance premium per capita is very low.
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 Lack of comprehensive social system benefit and welfare means that demand for pension
products is high.
 Huge middle class of approximately 300 Million.
 Existing insurance company score low on customer service front.
The insurance market registered growth in the Asian region even though India’s share in global
insurance is less than 0.5% (1988) as compared to USA (24.2%) and Japan (21%). Studies have
revealed that in an emerging market, as disposable income rises, Insurance premiums as a ratio
of GDP shoots up. The confederation of Indian Industry projected a growth of Life Insurance
premiums from Rs.350 Billion at present to Rs.140 Billion. The
Growth of non-life insurance premium is expected to increase from 75 billion to 375 billion. Out
of which, only 10% is tapped by the existing insurer.
Insurance even more than banking is a volume game. A very exclusive approach in view is
unlikely to provide meaningful numbers. Currently, insurance is bought for the purpose of tax-
benefits. A higher percentage of business is in the rural market. The share of rural new
Business insurance total new business is 55% in terms of policies and 47% in terms of sum
assured. However, this needs to be viewed in the light of some recent issues that have been
raised regarding as to what constitutes the rural market. Therefore, private insurers will be best
served by middle market approach, targeting the customer segments that are presently
unexploited.
How many Indians are aware that LIC has more than 60 Products and GIC has more than 180
Products? Not only there is a reduction in the premiums of Life Insurance products have long
overdue since Indian morality rate has decreased three folds in the last 50 years. There is also
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scope to increase the yield on life insurance policies (presently 6%) with proper risk management
in place.
It is been debated that insurance business does not produce profit in the first five years cross
subsidization is a feature of Indian market. Even the first portfolio vote that is considered
profitable, cross subsidizes other departments. Tariffs reduction is likely to reduce profits; further
insurers have to institute proper claims management progress in order to extract efficiencies. At
present life insurance business in the country is taxed at 12.5% of the profit in financial year. The
government is soon to present a new model of taxing life insurance companies at international
rates. New entrants should be well advised to look ahead to the stage where brand strength will
be a competitive advantage and sketch their alliances accordingly. In fact, we believe that
alliance related to distribution rather than to produce or technology will prove most valuable in
the long run.
Banks and financial companies will emerge, as attractive distribution channel for this insurance
trend will be led by two factors, which already apply in other world market. First Banking food
insurance, fund management and other financial services companies are being to increase their
profitability and provide maximum value to their customers. Therefore, they are themselves
looking for a range of products to distribute. In other market notably Europe; this has resulted in
bank assurance. Bank entering into the insurance business in India to bank hope to maximize
expensive existing network by selling a range of products more of a loss alliance between
insurance and bank than a formal ownership. Some Indian entrants like ICICI, HDFC and
Reliance hope to ride their existing network and customer bases.
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Chapter – 6 Research Methodology
Research means a search for knowledge or gain some new knowledge and methodology can
properly refer to the theoretical analysis of the methods appropriate to a field of study or to the
body of methods and principles particular to a branch of knowledge.
Research Design : A research design is the arrangement of conditions for the collections and
analysis of data in a manner that aims to combine relevance to research purpose with economy in
procedure.
Universe
The universe of the study is Dhanbad.
Sample Unit
The sample unit pertaining to the study is 100 respondents of Dhanbad region.
Sample Size
The sample size of 100 served the purpose of the study.
Sample Method
The sampling method used is non-probability convenience sampling
Methods of data collection
Data collection
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The word data means any raw information, which is either quantitative or qualitative in nature,
which is of practical or theoretical use. The task of data collection begins after a research
problem has been defined and research design chalked out. While deciding about the method of
data collection, the researcher should keep in mind that there are two types of data primary and
secondary.
Primary data
This is those, which are collected afresh and for the first Time, and thus happen to be original in
character. There are many ways of data collection of primary data like observation method,
interview method, through schedules, pantry Reports, distributors audit, consumer panel etc. The
Team Managers and employees of both the Department were consulted to get information about
procedure of both the online and off line share trading. But the method used by us for the
primary data collection was through questionnaires.
Questionnaire method
For the collection of primary data I used questionnaire method. A formal list of questions, which
are to be asked, is prepared in a questionnaire and questions are asked on those bases. There are
some merits and demerits of this method. These as under: -
Merits: -
1. Low cost even when universe is large.
2. It is free from bias of interviewer.
3. Respondents have proper time to answer.
4. Respondents who are not easily approachable can also be reachable.
5. Large samples can be made.
Secondary data
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These are those data, which are not collected afresh and are used earlier also and thus they
cannot be considered as original in character. There are many ways of data collection of
secondary data like publications of the state and central government, reports prepared by
researchers, reports of various associations connected with business, Industries, banks etc. And
the method, which was used by us, was with the help of reports of the company.
Sample Size
I have met 100 people, to know about their perception regarding companies and there policies
after that I have taken 25 People they have fill up the questionnaire and given response.
LIMITATIONS OF INSURANCE
 Lack of awareness among the people – This is the biggest limitation found in this sector.
Most of the people are not aware about the importance and the necessity of the insurance in
their life. They are not aware how useful life insurance can be for their family members if
something happens to them.
 Perception of the people towards Insurance sector – People still consider insurance just as
a Tax saving device. So today also there is always a rush to buy an Insurance Policy only at
the end of the financial year like January, February and March making the other 9 months dry
for this business.
 Insurance does not give good returns – Still today people think that Insurance does not
give good returns. They are not aware of the modern Unit Linked Insurance Plans which are
offered by most of the Private sector players. They are still under the perception that if they
take Insurance they will get only 5-6% returns which is not true nowadays. Nowadays most
of the modern Unit Linked Insurance Plans gives returns which are many times more than
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that of bank Fixed deposits, National saving certificate, Post office deposits and Public
provident fund.
 Lack of awareness about the earning opportunity in the Insurance sector – People still
today are not aware about the earning opportunity that the Insurance sector gives. After the
privatization of the insurance sector many private giants have entered the insurance sector.
These private companies in order to beat the competition and to increase their Insurance
Advisors to increase their reach to the customers are giving very high commission rates but
people are not aware of that.
 Increased competition – Today the competition in the Insurance sector has become very
stiff. Currently there are 14 Life Insurance companies working in India including the LIC
(life insurance Corporation of India). Today each and every company is trying to increase
their Insurance Advisors so that they can increase their reach in the market. This situation has
created a scenario in which to recruit Life insurance Advisors and to sell life Insurance Policy
has become very- very difficult.
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Chapter – 7 Scope & Importance of study
SCOPE
The study is restricted to Dhanbad region only. The study also analyses the preferences regarding
different life insurance policies of Birla-sun life insurance. For this study 100 respondents of
Dhanbad are chosen. Now days there are lot of private companies in market so it’s important to
know what motivates the customer to buy the policy. Birla sun life is the fastest growing private
insurance company in India. It determines market share of the various private companies in
India.
OBJECTIVES
 To determine and analyze the Market Potential of the Birla Sun Life Insurance Company.
 To determine whether the customers are satisfied with the policies of the company.
 To know the customer awareness regarding the Birla-sun life insurance and its products.
 To study and determine the competitor position in the market.
 To know the future plans of the people for buying the policies.
 Proper understanding and analysis of life insurance industry.
 Conduct market survey on a sample selected from the entire population and derived opinion
on that research.
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LIMITATION
 The time allotted for conducting the organizational study was only 30 days. It is not
enough for understanding about the organization in detail.
 Unavailability of some documents which where confidential .
 Employees where busy in their work so they could not give more information.
 There may be errors due to the bias of the respondent.
 The study is limited to my experience and knowledge.
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Chapter – 8 Review of literature
Here in review of literature I studied the role of relationship marketing in life insurance sector. In
today’s impersonal marketplace, customer satisfaction, retention and loyalty are rapidly become
the thing of the past. Relationship marketing brings them back to the forefront, providing easy-
to-apply solutions and strategies for establishing meaningful bonds with customers and turning
them into reliable, life-long partners. Relationship marketing can be defined as the process to
“identify and establish, maintain and enhance and, when necessary, terminate relationships with
customers and other stakeholders at a profit so that the objective of all parties involved are met;
and this is done by mutual exchange and fulfillment of promises”. The important objectives of
relationship marketing are to acquire new customer s, maintain and enhance existing
relationships with existing customers, reactivation of ex-customers, and handling of customer
terminations. The key objective of relationship marketing is to establish a one to one relationship
with all the customers. This may sound like a daydream few years ago; but thanks to the
technology breakthrough and technological solutions providers it is very much of reality.
I revised that insurance sector has not only been playing a leading role within the financial
system in India but also has significant socio-economical function, making inroads into the
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interiors of the economy and is being considered as one of the fast developing area in the Indian
financial sector too. It has also been facilitating economic development with an objective to build
an efficient, effective and a stable insurance business in India as well as a strong base to both the
needs of the real economy and socio-economic objective of the country. It has been mobilizing
long term saving through life- insurance to support economic growth and also facilitating
economic development, insurance cover to a large segment of people, while the non-life
insurance and reinsurance firms in India are main providers of risk financing for manmade
disasters and natural catastrophes. Thus, both life insurance and non-life insurance are found
playing a significant role in avoiding or facing the risk of life and business enterprises and also
aiding to certain extents for their smooth sailing. Therefore, an attempt is made in this paper to
highlight the developments of insurance sector in India in a phased manner and to examine the
reasons for the entry of private and foreign insurance players into Indian insurance market and to
present the changing scenario of insurance business in India. It is also attempted to examine the
growth of Indian insurance sector during the period of pre and post liberalization and finally to
suggest the strategies and challenges need to be adopted by Indian insurance sector in the light of
global scenario so as to enhance its market share.
Also studied that economic growth in the emerging markets has time and again outpaced the
developed and industrialized countries. Alongside the rising importance of emerging economics,
their life insurance sectors are also drawing more attention. It’s been four years since the life
insurance sector was opened up for private players in India. The reasons that prompted the
government to bring in reform in this sector are well known. While the public sector life
insurance companies made enormous contribution in the spread of awareness about insurance,
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and expanded the market, it was recognized that their reach was still limited, the range of product
offered restricted to the services to the consumer inadequate. It was also felt that the rapid
economic growth witnessed in the 90s couldn’t be sustained without a thriving insurance sector.
Today, the private accounts for nearly 20% of the market. The market share of the private
players has to be seen in the context of this enlarged market. There has been a flurry of private
players providing a wide range of innovation products, services and customized solutions.
Emerging markets-such as China, India, Mexico, and Russia- are home to some 86% of the
world’s population. Collectively, they account for 23% of world economic output. Yet, insurance
business is underdeveloped in these markets.
In fact, India as a country is under-insured. Only 35% of the 250 million insurable population is
insured. Exploiting the growth potential of emerging insurance market- India and China are in
the spotlight. Both the countries currently attract a lot of attention due to their size, strong growth
performance and favorable regulatory changes. To begin with, India and China are the most
populous countries and both have sustained impressive economic growth in the last decade.
Between 1993 and 2003, annual real GDP growth averaged 8.9% in china and 5.9% in India.
Interestingly, both markets have gone through a similar period of nationalization of their
insurance business, although China revoked state monopoly earlier than India.
Also many insurance companies vigorously pursue top-line growth, even though it has the
potential to develop unprofitably over time. The time lag(or tail) between when insurance is sold
and when claims are paid generates risks unique to insurance companies. Furthermore, the
insurance market is both mature and efficient (i.e. its level of completion is very high), which
means that profitable opportunities are both rare and untenable unless protected by competitive
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advantage. There currently no practical measure available ( of which the authors are aware ) at
the business unit level to evaluate insurance premium growth in the face of the industry’s risk,
impairing executives’ ability to assess segment opportunities (and hazards), thus hampering
strategies decision making. The purpose of this paper is to introduce a practical measure
developed by the authors called Underwriting Return (UWR) which aims at helping to alleviate
this situation. The paper introduces UWR which was developed during the course and scope of
the authors’ work in the insurance industry, and their research into applying value-based
management to that industry. The paper finds that UWR is a practical measure that property and
casualty executives can use at the business unit level to help quantify market segments to grow,
hold, harvest and abandon. A variety of strategies analysis tools, such as the popular Boston
Consulting Group matrix, are utilized today. In general, the application of such tools is hampered
by an imprecision of measurement but each can add a level of insight to executive’ resource
allocation options. UWR can further aid insurance executive in strategic analysis by helping to
quantify in which segments to compete, and which ones to abandon. The paper demonstrates the
utility of the measure in an example based on an actual analysis.
All the aspects of the Indian insurance industry along with an outlook for potential
developments. The report examines the trends in industry, besides the competitive landscape
offers a brief analysis on the main players in the industry. It contains an assessment based on
PEST analysis, covering the relevant political, economic, social and technological factors that
have implications for the development of the industry. The report also evaluates the industry
within th Michael porter framework. It goes on to describe the competitive landscape and
provides a comparative financial study of the major players in the industry. Insurance constitutes
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an important and increasing proportion of the gross financial savings of the household sector in
india. The private sector, in life as well as the non-life segments gained more prominent in the
life insurance sector. The factors that have driven change include: > Increasing Gross Financial
Household Savings. > Deregulation in the Indian Insurance Market. > Increase in dependency
ratio However, dearth of new products represents a major implication.
I studied the concept of banc assurance in India. Banc assurance has mostly been a phenomenal
success and, although slow to gain pace, is now taking off across Asia, especially now that banks
are starting to become more diverse financial institutions, and the concept of universe banking is
being accepted. In India, the signs of initial success are already there despite the fact that it is
completely new phenomenon. The factor and principles of why it is a success elsewhere exists in
India, and there is no doubt that banks are set to become a significant distributor of insurance
related products and services in the years to come.
I analyzed that the insurance industry has grown by 83 percent since the opening up the sector.
Remarking on the performance of the insurance industry, C S Rao, chairman, insurance
regulatory & development authority, said public sector players have not suffered with the
opening up of the sector. Insurance premium income has risen to Rs 82,415 crore (Rs 824.15
billion) in 2003-2004, against Rs 45,000 crore (Rs 450 billion) in 2000-01. Rao expects premium
income in the life insurance sector to rise further by 15-16 percent and non-life insurance
premium by 14 percent in 2005-06. The growth comes on the back of healthy demand from the
manufacturing sector.
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