A Study On Policyholders Satisfaction On Service Of LIC: · PDF file · 2015-06-20Analysis, Chi-square Test, and Garrett Ranking Technique. 3622 ISSN (Online): 2347-1697 ... Table

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Research Paper

International Journal of Informative & Futuristic Research ISSN (Online): 2347-1697

Volume 2 Issue 10 June 2015

Abstract

Generally, people do not have much awareness on insurance policies in the services rendered by LIC. It is the realization for the need of an insurance policy after the loss of life and property in an accident. It is commonly held conviction that insurance is a sheer waste and takes great effort to remove this mind-set among people. The successes of the insurance companies depend on the awareness among policyholders about insurance products and satisfaction of the policyholders regarding services rendered by the insurance company. Customer satisfaction depends upon how the customer perceives the policies offered by an insurance company and how they have delighted by its services. By understanding, customers’ awareness level about the products, perception about insurance products, service quality and satisfaction level, the marketing team can compete with other competitors to retain the existing customers as well as get new customers. The present study is attempted to know how customers perceive life insurance products, service quality and satisfaction levels of policy holders of the Life Insurance Corporation of India.

A Study On Policyholders Satisfaction

On Service Of LIC: Reference To

Coimbatore District Paper ID IJIFR/ V2/ E10/ 034 Page No. 3620-3626 Subject Area Management

Key Words Insurance Policies, Satisfaction Level, Policy Holders, Attitude, LIC Services

Received On 05-06-2015 Reviewed On 18-06-2015 Published On 20-06-2015

1. Dr. A.W .Unas Head of the Department Department of Business Administration Govt. Arts College, Coimbatore

2. S. Ram Kumar

Associate Professor Department of Management Hindustan College Of Arts & Science Coimbatore-Tamilnadu

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ISSN (Online): 2347-1697 International Journal of Informative & Futuristic Research (IJIFR)

Volume - 2, Issue - 10, June 2015 22ndEdition, Page No: 3620-3626

Dr. A.W .Unas , S. Ram Kumar: A Study On Policyholders Satisfaction On Service Of LIC: Reference To Coimbatore District

1. Introduction

The concept of insurance is that of a contract between two parties, the „insurer‟ and the „insured‟,

where the insurer agrees to pay the insured for any financial loss arising out of any unanticipated

events in return for a regular payment of a pre-determined sum of money termed „premium‟. Life

insurance provides both safety and protection to individuals and encourages savings. The insurance

sector is one of the important sectors of the liberalized Indian economy. In India, only less than 20

percent of the total insurable population has covered under various life insurance schemes. Life

Insurance Corporation of India (LIC) was soon challenged. Due to growing pressure, the task of

providing and maintaining higher level of customer satisfaction has become one of the most

important challenges for insurance companies. The LIC continues to be a dominating insurance

company in India and it is moving fast on a new growth path and by improving on its own past

records. The LIC of India has devised several life policies to satisfy the diversified needs and wants

of the customers.

2. Objectives of the study

To analyze the factors that influenced the policyholders to take the policy.

To ascertain the policyholders‟ level of satisfaction relating to services of LIC.

3. Scope of the Study

This study explores to reveal the policyholders level of satisfaction towards services of LIC and their

attitude towards private life insurance companies. This study highlights key areas, which the policy

makers in LIC have to improve their customer satisfaction. The study, analysis, findings, suggestions

and conclusion proposed by the researcher will also be helpful in future studies in the insurance

sector. The significance of this study is that, it brings out the differences in various parameters like

awareness level, service quality and the satisfaction levels of policyholders.

4. Research Methodology

This section includes sampling technique, collection of data, method of analysis and statistical tools used

in the present study.

i. Sample Design

The stratified multistage sampling method is adopted for the present study. Coimbatore district

has been selected by using the random sampling method. the respondents have been selected

based on convenient sampling method. The data have been collected from the 516 policyholders

who are selected by the convenient sampling method.

ii. Collection of Data

The study has been done from large sample of policyholders in Coimbatore District. Survey

method is the best approach for a quantitative research, with the help of a structured interview

schedule. It helps to understand the possible relationships between the data and the unknowns in

the universe. An interview schedule has been used as the instrument for collecting the research

data.

iii. Frame Work of Analysis

The data is first presented in tabular and graphical form representing the different responses given

by the policyholders. Then analysis is done using following statistical tools such as Frequency

Analysis, Chi-square Test, and Garrett Ranking Technique.

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5. Analysis And Interpretation

5.1 Profile of the Policyholders

Table 1: General Profile of the Policyholders

Factors Classification No of Respondents Percentage

Age Young Age

Middle Age

Elder Age

158

235

123

30.6

45.5

23.8

Gender Male

Female

290

226

56.2

43.8

Marital Status Married

Unmarried

395

121

76.6

23.4

Education qualification Illiterate

School level

Degree Level

Professional

56

118

176

166

10.9

22.9

34.1

32.1

Occupation Employee

Business & Profession

Agriculturist

Others

315

75

56

70

61.0

14.5

10.9

13.6

Income level Low Income Group

Middle Income Group

High Income Group

205

156

155

39.7

30.2

30.0

Family Size Two

Three

Four

130

253

133

25.2

49.0

25.8

Inference

Regarding personal profile of the consumer, the above table shows that 56.2% of the respondents are

male, 45.5% of the respondents are come under Middle age Group, about 76.6% are Married, 34.1%

of the respondents are Degree holders and the maximum respondents are employees (61%), 39.7%

of them are under low income group and regarding the family Size 49% of the respondents come

under three members.

5.2: Level of Satisfaction

Table 2: Level of Satisfaction of Policy Holders Regarding Service

Level of Satisfaction Frequency Percentage in Total

Highly Satisfied 133 25.8

Moderately Satisfied 287 55.6

Low Satisfied 96 18.6

Total 516 100

Inference

Most of the respondents (55.6%) are moderately satisfied with services of LIC in the study area,

about 25.8 percent of the respondents registered their satisfaction at a higher level and remaining

18.6 percent of the respondents expressed low satisfaction levels with LIC services.

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5.3 Chi Square test

Table 3: Educational Qualification and Level of Satisfaction

Classification

Level of Satisfaction

Low Moderate High Total

Chi-

Square

value

P

value

Illiterate

Count 9 25 22 56

22.682 0.001

% within Row 16.1% 44.6% 39.3% 100%%

% within Column

9.4% 8.7% 16.5% 10.9%

School Level

Count 17 81 20 118

% within Row 14.4% 68.6% 16.9% 100%

% within Column 17.7% 28.2% 15.0% 22.9%

Degree Level

Count 31 106 39 176

% within Row 17.6% 60.2% 22.2% 100%

% within Column 32.3% 36.9% 29.3% 34.1%

Professional

Course & Others

Count 39 75 52 166

% within Row 23.5% 45.2% 31.3% 100%

% within Column 40.6% 26.1% 39.1% 32.2%

Total Count 96 287 133 516

% within Row 18.6% 55.6% 25.8% 100%

Inference

Researcher framed the hypothesis as “there is no significant relationship between educational

qualification of respondents and their level of satisfaction”. This hypothesis has been tested with the

help of chi-square test. The calculated value of Chi-Square value is 22.682 and „P‟ value is 0.001.

Since the calculated P value is less than 0.05, the null hypothesis has been rejected.

5.4: Occupation and Level of Satisfaction

Table 4: Occupation and Level of Satisfaction

Classification



Chi-

Square

value

P

value

Employee

Count 72 149 94 315

25.737 0.001

% within Row 22.9% 47.3% 29.8% 100%%

% within Column 75.0% 51.9% 70.7% 61.0%

Business &

profession

Count 8 49 18 75

% within Row 10.7% 65.3% 24.0% 100%

% within Column 8.3% 17.1% 13.5% 14.5%

Agriculturist

Count 9 40 7 56

% within Row 16.1% 71.4% 12.5% 100%

% within Column 9.4% 13.9% 5.3% 10.9%

Others

Count 7 49 14 70

% within Row 10.0% 70.0% 20.0% 100%

% within Column 7.3% 17.1% 10.5% 13.6%

Total Count 96 287 133 516

% within Row 18.6% 55.6% 25.8% 100%

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Inference: The researcher framed the hypothesis as “There is no significant relationship between

occupation of respondents and their level of satisfaction towards LIC services”. The researcher has

tested the hypothesis using the Chi-Square test. The calculated value of Chi-Square value is 25.373

and „P‟ value is 0.001. Since the calculated P value is less than 0.05, the null hypothesis has been

rejected.

5.5 Income and Level of Satisfaction

Table 5: Income and Level of Satisfaction

Classification



Chi-

Square

value

P

value

Low Income

Group

Count 29 143 33 205

36.774 0.001

% within Row 14.1% 69.8% 16.1% 100%

% within Column 30.2% 49.8% 24.8% 39.7%

Middle Income

Group

Count 29 85 42 156

% within Row 18.6% 54.5% 26.9% 100%

% within Column 30.2% 29.6% 31.6% 30.2%

High Income

Group

Count 38 59 58 155

% within Row 24.5% 38.1% 37.4% 100%

% within Column 39.6% 20.6% 43.6% 30.0%

Total Count 96 287 133 516

% within Row 18.6% 55.6% 25.8% 100%

Inference

The researcher has framed the hypothesis as “there is no significant relationship between income

level of respondents and their level of satisfaction”. The hypothesis has been tested with the help of

chi-square test. The calculated value of Chi-Square value is 36.774 and „P‟ value is 0.001. Since the

calculated P value is less than 0.05, the null hypothesis has been rejected.

5.6: Factors Adopted By The Respondent In Selecting A Policy

The percentage position of each rank thus obtained is converted into scores by referring to the table

given by Henry Garrett. Then for each factor the scores of individual respondents are added together

and divided by the total number of respondents for whom the scores are added. These mean scores

for all the factors are arranged in the order of their ranks and inferences are drawn.

The Table no. 6 mentioned below highlights Garrett‟s scores which help to decide the most

important factors adopted by the respondent in selecting a policy. The highest score is 67.87, the first

rank for safety, and the lowest rank is 39.71, the last rank selected by the respondent which is loan

facility. It is inferred from this Table that an individual chooses the policy based on his own

perceptions in order to satisfy his/her needs.

Garrett’s’ Ranking Technique used

To perform Henry Garretts‟ ranking the following formula has been used.

Percentage position =

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Rij = Rank given for ith item jth individual

Nj = Number of items ranked by jth individual

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6. Findings

Most of the respondents (55.6%) are moderately satisfied with services of Life Insurance

Corporation.

There is a significant relationship between educational qualification of respondents and their

level of satisfaction.

There is a significant relationship between occupation of respondents and their level of

satisfaction towards LIC services.

There is a significant relationship between income level of respondents and their level of

satisfaction.

The most important factors adopted by the respondent in selecting a policy. The highest

score is 67.87, the first rank for safety, and the lowest rank is 39.71, the last rank selected by

the respondent which is loan facility. It is inferred from this Table that an individual chooses

the policy based on his own perceptions in order to satisfy his/her needs.

7. Suggestions

The terms and conditions of the product should be transparent to the public.

Researcher suggests to policy makers to give more importance to design core services rather

than allied business services.

Relax the formalities in renewal of lapsed policies.

Periodical review about the service quality required to maintain and improve the service

quality.

8. Conclusion

In India, the opened economic policy for the insurance industry has increased competition for

players in the insurance industry. The oldest and leading public sector insurance companies like LIC

in India are facing very stiff competition from the new players entering the market. In addition, in

case of the insurance sector the reference group plays a vital role. So keeping this aspect in

consideration, leading insurance players should focus on service quality. Service quality can be used

as a strategic tool to get a competitive advantage over challenging insurance providers. LIC should

focus on assurance and tangibility to further strengthen the level of service quality. Life Insurance

Corporation of India competes other players in the market very aggressively, but the low score in the

reliability dimension is a contra indicator.

References

[1] Marketing Management Philip Kotler, Prentce Hall of India Private Limited New Delhi 2000

[2] Marketing Research Malhotra, third edition, Pearson Education.

[3] A Note on the Insurance Status in India for Poor, Aggarwal and Preeti Alliance Journal of Business

Research, 2005

[4] A Study on the Expectations and Perceptions of the Services in Private Life Insurance Companies,

Keerthi, P. and Vijayalakshmi, R SMART Journals, Vol. 5, 2009.

[5] A study on Service Quality Measurement and its Impacts in Opting Insurance Companies”

International Journal of Social Science & Interdisciplinary Research, Malini (2012)

Documents

A Study On Policyholders Satisfaction On Service Of LIC: · PDF file · 2015-06-20Analysis, Chi-square Test, and Garrett Ranking Technique. 3622 ISSN (Online): 2347-1697 ... Table