133
PROJECT REPORT Batch 2009 - 2012 ING Vysya Life Insurance Pvt. Ltd. Submitted in fulfillment of Year III of BBA From PGRRCDE Osmania University, Hyderabad SUBMITTED TO: SUBMITTED BY: Mr. Kshitz Jain Somendar kumar Meena (PROJECT GUIDE) Mr. Jogendra Yadav ENROLL NO. -941005143 _____________ (INDUSTRY GUIDE) Through

somendra kumar meena

Embed Size (px)

Citation preview

Page 1: somendra kumar meena

PROJECT REPORT

Batch 2009 - 2012

ING Vysya Life Insurance Pvt. Ltd.

Submitted in fulfillment of Year III of BBA

From

PGRRCDE

Osmania University, Hyderabad

SUBMITTED TO: SUBMITTED BY:Mr. Kshitz Jain Somendar kumar Meena

(PROJECT GUIDE)

Mr. Jogendra Yadav ENROLL NO. -941005143

_____________

(INDUSTRY GUIDE)

Through

Page 2: somendra kumar meena

CERTIFICATE

This is to certify that Somendar kumar Meena a student of BBA Last Year (Bachelors in

Business Administration) 2009-12, UEI Global, a Berggruen Venture, has undergone summer

training from June to August in our organization ING Vysya Life Insurance Pvt. Ltd.

During her summer training He was found regular, sincere and took keen interest in training.

We wish her success in her future endeavors.

Industry Guide

Page 3: somendra kumar meena

Declaration

I Somendar kumar Meena student of UEI Global Jaipur Institute hereby declare that the Project

Report entitled “Comparative analysis of various products offered by ING Vysya Life Insurance

Pvt. Ltd. submitted, is my original work and the dissertation has not formed the basis for the

award of any degree, diploma, associate ship, fellowship or similar other titles. It has not been

submitted to any other university or Institution for the award of any degree or diploma.

Place: Jaipur Signature of Student

Date : Name :Somendar kumar Meena

En. No. 9414005143

Page 4: somendra kumar meena

Acknowledgement

 I would like to take this opportunity as a platform to thank various individuals, without the

support of whom, this project would not have been successful. 

I would like to express my heartfelt gratitude and thanks to Mr. Jogendra yadav (Industrial

Guide) for his guidance and support throughout this study. I am thankful to my Institute for

providing me with proper resources and fostering my research work.

I would like to take this opportunity to thank all the respondents who trusted me and gave me

their valuable insight. I also thank the Faculty Supervisors and Industrial supervisors under

whose able guidance and kind cooperation, I was able to complete my study titled,

“________________________________________________”.

I also thank the people from ING Life Insurance gave me proper knowledge about the company. 

My acknowledgement would not be complete without thanking Mr./Ms.____________,

Mr.Jogendra yadav and Mr. Punit sexena who gave me proper guidelines, knowledge and support

for our summer training project.

I have put in my best efforts to make this project as informative and understandable as

possible. Every effort has been made to enhance the quality of work. However, I owe the sole

responsibility of the shortcomings, if any, in the study

 

Name & Signature of Student Date:

Page 5: somendra kumar meena

Preface

The Summer Internship Program forms an important component of education at UEI Global. It is

an attempt to bridge the gap between the academic institution and the corporate world. It provides

us an opportunity to apply the concepts learnt in real life situations. 

The summer internship helps us in exploring our skills and capabilities. This internship program

makes a mark of hard work, sincerity, knowledge and ethics on the host organization. It would

also be a great learning experience since it enables us to apply theory to practice and observe and

learn the current trends in the market. 

It provides an opportunity for us to satisfy our inquisitiveness about corporate, provides exposure

to technical skills, and helps us to acquire social skills by being in constant interaction with the

professionals of other organizations. 

It helps us in developing a network, which will be useful in enhancing in career prospects. This

will help to gain a deeper understanding of the work, culture, deadlines, pressures etc. of an

organization. 

Thus, it helps to develop the qualities of a Manager by involving teamwork, goal orientation and

managing interpersonal relationships and by creating awareness about strengths and weaknesses

in the work environment.

Page 6: somendra kumar meena

Table Contents

PAGE

Chapter One INTRODUCTION

Chapter Two OBJECTIVE AND METHODOLOGY

Chapter Three ORGANISATION PROFILE

Chapter Four HISTORY OF THE ING

Chapter Five HISTORY OF INSURANCE SECTOR

Chapter Six ANALYSIS AND INTERPRETATION OF DATA

Chapter Seven CONCLUSION AND SUGGESTIONS

Chapter Eight LIMITATIONS OF THE STUDY

Chapter Nine BIBLOGRAPHY

Chapter Ten Revitalization of Rural Markets through Insurance

Page 7: somendra kumar meena

Chapter I

INTRODUCTION

Introduction to Insurance

Insurance is defined as a cooperative device to spread the loss caused by a particular risk over a number of persons who are exposed to it and who agree to ensure themselves against that risk.  Risk is uncertainty of a financial loss.  The insurance is also defined as a social device to accumulate funds to meet the uncertain losses arising through a certain risk to a person injured against the risk.

Introduction to Life Insurance

According to the U.S. Life Office Management Inc. (LOMC), "Life Insurance provides a sum of money if the person who is insured dies whilst the policy is in effect."

Life insurance has come a long way from the earlier days when it was originally conceived as a risk-covering medium for short periods of time, covering temporary risk situations, such as sea voyages.  As life insurance became more established, it was realized what a useful tool it was for a number of situations that includes temporary needs/threats, savings, investment, retirement etc.

History of Life Insurance

Life insurance made its first appearance in England in 16th century.  The first registered life office in England was the hand in hand society in 1696.  The famous 'Amicable Society' for a perpetual assurance office started its operation since 1706.  Life insurance did not prosper in the United States during the 18 th century, because of serious fluctuations in death-rate. 

Life Insurance in India

Page 8: somendra kumar meena

In India some Europeans started the first life insurance company in Bengal Presidency, viz., The Orient Life Insurance in 1818.  The Year 1870 was a year of land mark in the history of Indian Insurance separating the early period of pioneering attempts at life insurance from the subsequent period of steady development at the establishment of Indian life office, viz., Bombay Mutual Life Assurance Society in 1871.

Up to end of 19th century, the insurance was in the inceptional stage.  Therefore no legislation was required till that usually the Indian Company Acts 1883 was applicable.  Since 1956, with the nationalization of insurance industry, the state – run Life Insurance Corporation of India (LIC) has held the monopoly in India.  Then comes the LPG (Liberalisation, Privatisation and Globalisation) that paved entry of Private and Foreign Life Insurance players in India during the late 90's and earlier 2000's.  Currently India and China are the most lucrative insurance markets in the world.  They constitute the home of half of the population of the world and their recent rapid economic development makes them attractive for foreign investment.   The share of life insurance premium to GDP of India was 1.29 percent, which is abysmal in the global standard.  Despite these opportunities, however, there is also a rough ride ahead for the new players in India.  This is because, unlike in the West, insurance is sold more as an instrument of savings in India than as a product offering for protection and security.  LIC's 1996 insurance survey reveals that more than 40 percent of insurance-buyers look at insurance products as a means of savings.  Risk coverage is only a secondary objective for them and nearly 26 percent of the insurance policies sold are on considerations of old age security.  Only 18 percent of insurance policies are sold on death risk considerations.

Insurance Regulatory and Development Authority (IRDA)

The regulatory body for insurance IRDA has been established with the following mission:

"To protect the interests of the policy holders, to regulate, promote and ensure orderly growth of the insurance industry and for matters connected therewith or incidental thereto."

Private Players in Indian Life Insurance

The major players in Indian life insurance sector include:

* Allianz Bajaj Life Insurance Company Ltd.,

* Aviva Life Insurance Co. India Pvt. Ltd.,

* AMP SANMAR Assurance Company Ltd.,

* Birla Sun Life Insurance Company Ltd.,

* HDFC Standard Life Insurance Company Ltd.,

* ICICI Prudential Life Insurance Company Ltd.,

* ING Vysya Life Insurance Company Private Ltd.,

* Life Insurance Corporation of India

* Max New York Life Insurance Co. Ltd.,

* MetLife India Insurance Company Pvt. Ltd.,

Page 9: somendra kumar meena

* Om Kotak Mahindra Life Insurance Co. Ltd.,

* SBI Life Insurance Company Ltd.,

* Sahara India Insurance Company Ltd.,

* Tata AIG Life Insurance Company Ltd.,

The market share for LIC is 90 percent and other players share only the remaining 10 percent.

Market Potential for Private Life Insurance Companies in India

It has been found out that:

* 85 percent of the Indians prefer LIC than any other insurance companies. 

* 'Prevention of Loss', 'Assured Returns' and 'Long term Investment' are the important factors influencing Indians in opting for Life Insurance  

* Only few of the Indians are aware of private life insurance companies. 

* Most of the Indians are of the opinion that private insurance companies would be able to perform well in the long run. 

* Most of the Indians are interested in 'Money back' policies than others

* Most of them are interested in insuring for an amount of Rs. 1- 2 lakhs

* There is significant relationship existing between monthly household income and amount insured

* Based on the monthly household income, Indians prefer to their investment needs like bank deposit, post office schemes, real estate, insurance, gold, chit funds, shares etc.

* Agents are mostly responsible for selling insurance products in India 

Conclusion

The market potential for private insurance companies is found to be greater in the long run

as most of the Indians are of the opinion that, private insurance companies would be able to

perform well in the future.  The private and foreign insurance companies have to immediate

steps in appointing more number of agents and/or advisors in addition to the employees as it

has been found out that agents are the best channel to reach the general public regarding

selling of insurance products.   The private and foreign insurance companies have to

concentrate on the factors like 'Prevention of Loss', 'Assured Returns' and 'Long term

Investment'.  They can also focus on an insurance amount of Rs. 1 – 2 lakhs with 'money

Page 10: somendra kumar meena

back policies'.  Hence, the market has potential.  The private and foreign insurance

companies that are taking immediate steps can tap it.

The project titled "Comparative analysis of products offered by ING” is a study of

the project undertaken in the ING Vysya Life Insurance Pvt. Ltd. The report covers

a detailed study of the ING group, its history, the businesses it has

ventured into and its organizational structure. The report also deals with an in-

depth study of the Insurance industry in India. The industry profile helps to gain an

insight into the evolution of the industry and competitive dynamics prevalent in the

market. It discusses the significant developments in the industry and analyzes the

key trends and issues. The profile provides inputs in strategic business planning of

industry professionals. The various sections of industry profile has been discussed

below.

About ING in India

ING operates through three businesses in India, ING Vysya Life Insurance, ING

Vysya Bank and ING Investment Management. ING Vysya Bank is a premier

private sector bank with over 76-year heritage and 1.5 million satisfied customers.

ING Investment Management believes in providing investors with the knowledge

& opportunity to manage their future easily.

ING Life India, in its 10th year of operations, is a part of the ING Group. ING Life

entered the private life insurance industry in India in September 2001. The

company has issued over 1 million policies and is staffed by over 6500 employees.

Headquartered in Bangalore, ING Life India is currently present in 229 cities across

251 branch offices. In addition, the company distributes its products in several parts

of the country through its partner's presence.

ING Life India distributes its products through two channels, the Tied Agency

Force and the Alternate Channel. The Tied Agency force comprises over 50,000

Page 11: somendra kumar meena

ING Life Advisors, spread across the country. The Alternate Channels business

within ING Life India is a fast growing distribution channel, and includes the Banc

assurance partner (ING Vysya Bank), Referral Partners, Corporate Agents and

Brokers.

ING was established as a Naamloze Vennootschap (public limited liability

company) on March 4, 1991, through the merger of Nationale-Nederlanden, which

was the largest insurer in the Netherlands, and NMB Postbank Group, which was

one of the largest banks in the Netherlands. ING Group N.V. is incorporated under

the laws of the Netherlands.

OBJECTIVE AND METHODOLOGY

COMPANY OBJECTIVE:

ING aims to deliver financial products and services in the way that our customers want them delivered: with exemplary service and maximum convenience at competitive prices.

ING – MISSION

Mission statement: To set the standard in helping our customers manage their financial future.

ING- Tag Line:

Shaping our future

ING LIFE INDIA-CURRENT SHAREHOLDING:

26% 50%

Page 12: somendra kumar meena

11.53% 12.47%

ING PARTENERS IN INDIA:

1. Exide Industries Limited-is the market leader in both automotive and industrial segments.

‘EXIDE’ and ‘SF’ (Standard Furukawa), the flagship brands of the Company, which are the

leading battery brands in the country.

2. Rajan Raheja the promoter of the group is ranked 30 th by Forbes among Indians by New

worth... His Net worth stands at: $2.15 billion.

3. Gujarat Abuja Cements Ltd.-the third largest cement company in India.

4. Enam Group-Enam Group is one of India’s leading financial service providers reputed for its

ability to perceive the true potential of businesses and enhance their value. The culture at

Enam Group is deeply rooted in ethics, innovation and financial sobriety.

Page 13: somendra kumar meena

ORGANISATION PROFILE

ING- Company Profile:

ING was founded in 1991 by a merger between Nationale-Nederlanden and NMB Postbank

Group. During the past years ING has become a multinational with diverse international

activities.

The roots of ING can be traced to the insurers De Nationale Levensverzekering Bank and De

Nederlanden van 1845 and to the public bank services such as De Rijkspostspaarbank and De

Postcheque- and Girodienst, as well as to the Nederlandsche Middenstands Bank. These are the

legal predecessors of the ‘founding fathers’ of ING: Nationale-Nederlanden and NMB Post bank

Group.

The founding of ING as one company was started in 1990 when the legal restrictions on mergers

between insurers and banks were lifted in the Netherlands. This prompted insurance company

Nationale-Nederlanden and banking company NMB Post bank Group to enter into negotiations.

The merger into Internationale Nederlanden Group took place in 1991. The market soon

abbreviated the name to I-N-G. The company followed suit by changing the statutory name to

ING Groep N.V. Since 1991, ING has developed from a Dutch company with some international

business to a multinational with Dutch roots. This was achieved through a mixture of organic

growth, such as the creation of ING Direct from scratch, as well as various large acquisitions.

The first large acquisition took place in 1995, when ING took over Barings Bank. This

acquisition increased the brand recognition of ING around the world and strengthened its

wholesale banking presence in the emerging markets. And then there was Life of Georgia. This

insurance company was acquired by Nationale-Nederlanden in 1979, resulting in a significant

increase in activities in the US. Via Life of Georgia, the activities in Asia expanded considerably.

However in 2004, ING as a group had become well-established in both regions and Life of

Geogeria was sold. Other acquisitions, such as the Belgian Bank Brussels Lambert, strengthened

the Group’s presence in the Benelux. In addition, the activities in de United States were doubled

as a result of organic growth and the acquisition of Equitable of Iowa, ReliaStar, Aetna

financial services and merchant bank furman Selz

Page 14: somendra kumar meena

Profile

ING has gained recognition for its integrated approach of banking, insurance and asset

management. Furthermore, the company differentiates itself from other financial service

providers by successfully establishing life insurance companies in countries with emerging

economies, such as Korea, Taiwan, Hungary, Poland, Mexico and Chile. Another specialization

is ING Direct, an Internet and direct marketing concept with which ING is rapidly winning retail

market share in mature markets. Finally, ING distinguishes itself internationally as a provider of

‘employee benefits’, i.e. arrangements of nonwage benefits, such as pension plans for companies

and their employees.

Page 15: somendra kumar meena

HISTORY OF THE ING

ING’s orange lion goes way back to ING’s Dutch roots. Orange is the national color of the

Netherlands, and the lion the country’s national symbol. Several founding ING companies, banks

and insurers, had or still have the lion in their logos.

Logo’s from banking history of ING:

One of ING’s founding companies; the Rijkspostspaarbank was established in 1881.

Government-owned, the company had the Dutch coat of arms flanked by two lions in its logo

surmounting the motto ‘je maintiendrai’ (I will maintain). In the 1950s and 1960s, another ING

founding company, the Nederlandsche Middenstandsbank (NMB), used the same logo on its

stationery and official documents.

The logo was modernized several times in the course of the merger of Rijkspostspaarbank and the

Postcheque- & Girodienst into Postgiro/Rijkspostbankspaarbank, culminating in privatization as

the Postbank in 1986. The lion rampant became recumbent, lost a little of its wild mane and

acquired a longer tail.

Logos from our insurance history The original insurance companies, De Nederlanden van 1845

and the Nationale Levensverzekering-Bank, both had lions in their logos. For a long time De

Nederlanden van 1845 used the Dutch coat of arms. The Nationale had a logo depicting a virgin

Page 16: somendra kumar meena

with a lion at her feet, symbolizing the company’s courage in looking after its customers’ savings

deposits. The two companies merged and became Nationale-Nederlanden

The lion survived

The logo was very much a negotiating issue when NMB and Postbank merged, and later on when NMB Postbank Group and Nationale-Nederlanden joined forces but the lion has survived all mergers.

ING current logo

The orange lion adorns their global ING logo.

Business Divisions: ING is serving its services in three fields of areas which are as follows:

Page 17: somendra kumar meena
Page 18: somendra kumar meena

HISTORY OF INSURANCE SECTORThe business of life insurance in India in its existing form started in India in the year 1818 with

the establishment of the Oriental Life Insurance Company in Calcutta. Some of the important

milestones in the life insurance business in India are given in the table 1

Table 1: milestone’s in the life insurance business in India

year Milestones in the life insurance business in India

1912 The Indian Life Assurance Companies Act enacted as the first statute to regulate the

life insurance business

1928 The Indian Insurance Companies Act enacted to enable the government to collect

statistical information about both life and non-life insurance businesses

1938 Earlier legislation consolidated and amended to by the Insurance Act with the objective

of protecting the interests of the insuring public.

1956 245 Indian and foreign insurers and provident societies taken over by the central

government and nationalized. LIC formed by an Act of Parliament, viz. LIC Act, 1956,

with a capital contribution of Rs. 5 crore from the Government of India.

The General insurance business in India, on the other hand, can trace its roots to the Triton

Insurance Company Ltd., the first general insurance company established in the year 1850 in

Calcutta by the British. Some of the important milestones in the general insurance business in

India are given below in table 1

year Milestones in the general insurance business in India

Page 19: somendra kumar meena

1907 The Indian Mercantile Insurance Ltd. set up, the first company to transact all classes of

general insurance business

1957 General Insurance Council, a wing of the Insurance Association of India, frames a

code of conduct for ensuring fair conduct and sound business practices

1968 The Insurance Act amended to regulate investments and set minimum solvency

margins and the Tariff Advisory Committee set up.

1972 The General Insurance Business (Nationalization) Act, 1972 nationalized the general

insurance business in India with effect from 1st January 1973.

107 insurers amalgamated and grouped into four companies’ viz. the National

Insurance Company Ltd., the New India Assurance Company Ltd., the Oriental

Insurance Company Ltd. and the United India Insurance Company Ltd. GIC

incorporated as a company.

ANALYSIS AND INTERPARETATION OF DATA

EXECUTIVE SUMMARY

The project titled "Comparative analysis of products offered by ING” is a study of the project

undertaken in the ING Vysya Life Insurance Pvt. Ltd. The report covers a detailed study of the

ING group, its history, the businesses it has ventured into and its organizational

Page 20: somendra kumar meena

structure. The report also deals with an in-depth study of the Insurance industry in India. The

industry profile helps to gain an insight into the evolution of the industry and competitive

dynamics prevalent in the market. It discusses the significant developments in the industry and

analyzes the key trends and issues. The profile provides inputs in strategic business planning of

industry professionals. The various sections of industry profile has been discussed below.

Industry Snapshot

This section gives a holistic overview of the industry. It starts with defining the market and goes

on to give historical and current market size figures. It also clearly illustrates the major segments

of the market which would be discussed later on in the detailed report.

Industry Analysis

It involves a comprehensive analysis of the industry and its market segments. This section

discusses the key developments that have taken place in the industry. It also identifies and

analyzes the driving factors and challenges of the industry. A description of the regulatory

structure tells us about the major regulatory bodies, laws and government policies.

Competitor Assessment

This section compares the major competitors in the industry. The Competitors At-a-Glance is

aimed at giving an overview of the competitive landscape in the industry.

Investment sector in India has seen a lot of changes in past few years with multinational companies coming

into the country, bringing in their professional expertise in managing funds worldwide. In the past few

years there has been a paradigm shift going on in the investment industry in India. Now investors have a

wide range of Schemes to choose from depending on their individual profiles.

Guidelines on KYC Norms and Cash Transaction by RBI

1. Guidelines for New Account

2. Procedures for existing customers

3. ING policy on Know your customer

The analysis of various products includes a response of various clients under different income

slabs and comparison on the basis of risk, return and time preference of customers for these

purpose charts and tables are drawn with the data collected through questionnaire.

1.1

1. ING.

1.2 RESEARCH METHODOLOGY:

Page 21: somendra kumar meena

In this project report two types of data used are as follows:

1. Primary data

2. Secondary data

This study is entirely depends on the secondary data collected through the ING and

related links. Analysis will be done with the help of following:

1. A table will be drawn with relevant statistics.

2. Each table will be analyses with a bar chart or a pie chart.

3. Finding will be reported at the end of project.

4. Data will be presented in both qualitative as well as quantitative form.

1Data is limited to consumers in selected areas hence the study output cannot be generalized.

Time is one of the constraints since the time frame of the study lasted for two month.

1.5 CONCLUSION:

The project undertaken in the ING Vysya Life Insurance was a good learning experience

Page 22: somendra kumar meena

2

HISTORY OF INSURANCE SECTOR

The business of life insurance in India in its existing form started in India in the year 1818 with

the establishment of the Oriental Life Insurance Company in Calcutta. Some of the important

milestones in the life insurance business in India are given in the table 1

Table 1: milestone’s in the life insurance business in India

year Milestones in the life insurance business in India

1912 The Indian Life Assurance Companies Act enacted as the first statute to regulate the

life insurance business

1928 The Indian Insurance Companies Act enacted to enable the government to collect

statistical information about both life and non-life insurance businesses

1938 Earlier legislation consolidated and amended to by the Insurance Act with the objective

of protecting the interests of the insuring public.

1956 245 Indian and foreign insurers and provident societies taken over by the central

government and nationalized. LIC formed by an Act of Parliament, viz. LIC Act, 1956,

with a capital contribution of Rs. 5 crore from the Government of India.

Page 23: somendra kumar meena

The General insurance business in India, on the other hand, can trace its roots to the Triton

Insurance Company Ltd., the first general insurance company established in the year 1850 in

Calcutta by the British. Some of the important milestones in the general insurance business in

India are given below in table 1

year Milestones in the general insurance business in India

1907 The Indian Mercantile Insurance Ltd. set up, the first company to transact all classes of

general insurance business

1957 General Insurance Council, a wing of the Insurance Association of India, frames a

code of conduct for ensuring fair conduct and sound business practices

1968 The Insurance Act amended to regulate investments and set minimum solvency

margins and the Tariff Advisory Committee set up.

1972 The General Insurance Business (Nationalization) Act, 1972 nationalized the general

insurance business in India with effect from 1st January 1973.

107 insurers amalgamated and grouped into four companies’ viz. the National

Insurance Company Ltd., the New India Assurance Company Ltd., the Oriental

Insurance Company Ltd. and the United India Insurance Company Ltd. GIC

incorporated as a company.

Insurance Market- Present: [Since 2001]

.

Life Insurance

The traditional life insurance business for the LIC has been a little more than a savings policy.

Term life (where the insurance company pays a predetermined amount if the policyholder dies

within a given time but it pays nothing if the policyholder does not die) has accounted for less

Page 24: somendra kumar meena

than 2% of the insurance premium of the LIC (Mitra and Nayak, 2001). For the new life

insurance companies, term life policies would be the main line of business.

Health Insurance

Health insurance expenditure in India is roughly 6% of GDP, much higher than most other

countries with the same level of economic development. Of that, 4.7% is private and the rest is

public. What is even more striking is that 4.5% are out of pocket expenditure (Berman, 1996).

There has been an almost total failure of the public health care system in India. This creates an

opportunity for the new insurance companies.

Thus, private insurance companies will be able to sell health insurance to a vast number of

families who would like to have health care cover but do not have it.

Pension

The pension system in India is in its infancy. There are generally three forms of plans: provident

funds, gratuities and pension funds. Most of the pension schemes are confined to government

employees (and some large companies). The vast majority of workers are in the informal sector.

As a result, most workers do not have any retirement benefits to fall back on after retirement.

Total assets of all the pension plans in India amount to less than USD 40 billion.

Therefore, there is a huge scope for the development of pension funds in India. The finance

minister of India has repeatedly asserted that a Latin American style reform of the privatized

pension system in India would be welcome (Roy, 1997). Given all the pros and cons, it is not

clear whether such a wholesale privatization would really benefit India or not (Sinha, 2000).

MARKET SHARE OF INDIAN INSURANCE INDUSTRY

The introduction of private players in the industry has added value to the industry. The initiatives

taken by the private players are very competitive and have given immense competition to the on

time monopoly of the market LIC. Since the advent of the private players in the market the

industry has seen new and innovative steps taken by the players in this sector. The new players

have improved the service quality of the insurance. As a result LIC down the years have seen the

declining phase in its career. The market share was distributed among the private players. Though

LIC still holds the 75% of the insurance sector but the upcoming natures of these private players

are enough to give more competition to LIC in the near future. LIC market share has creased

from 95% (2002-03) to 81 %( 2004-05).The following companies has the rest of the market share

of the insurance industry. Table 3 shows the mane of the player in the market.

TABLE NO: 3 NAME OF THE INSURANCE COMPANY AND THEIR SHARE HOLDING

PATTEN

Page 25: somendra kumar meena

There are a total of 13 life insurance companies operating in India, of which one is a Public

Sector Undertaking and the balance 12 are Private Sector Enterprises.

List of Companies are indicated below:-

TABLE NO: 4 NAME OF THE LIFE INSURANCE COMPANY AND THE SHARE

HOLDING PATTEN

Name of the company Nature of Holding

Allianz Bajaj Life Insurance Co Private

Aviva Life Insurance Private

Birla Sun Life Insurance Co Private

HDFC Standard Life Insurance Co Private

ICICI Prudential Life Insurance Co Private

ING Vysya Life Insurance Co. Private

Life Insurance Corporation of India Public

Max New York Life Insurance Co. Private

MetLife Insurance Co. Private

Name of the Insurance Company Shareholding

Agricultural Insurance Co Bank and Public Ins Co

Bajaj Allianz General Insurance Co. Ltd. Privately Held

Cholamandalam MS General Insurance Co. Ltd. Privately Held

Export Credit Guarantee Company Public Sector

HDFC Chubb General Insurance Co. Ltd. Privately Held

ICICI Lombard General Insurance Co. Privately Held

IFFCO-Tokyo General Insurance Co. Ltd. Privately Held

National Insurance Co. Ltd. Public Sector

Oriental Insurance Co. Ltd. Public Sector

Reliance General Insurance Co. Ltd. Privately Held

Royal Sundaram Alliance General Insurance Co. Ltd. Privately Held

Tata AIG General Insurance Co. Ltd. Privately Held

United India Insurance Co. Ltd. Public Sector

Page 26: somendra kumar meena

Om Kotak Mahindra Life Insurance Private

Reliance insurance Private

SBI Life Insurance Co Private

TATA- AIG Life Insurance Company Private

Current market share of different Insurance companies:

Current Market share amongst private players in India:

Page 27: somendra kumar meena

Indian Insurance Market

The Indian insurance market in spite of having a history covering almost two centuries took a

turn after the establishment of the Life insurance Corporation in India in 1956. From being an

open competitive market to being nationalized and then back to a liberalized market again, the

insurance sector has witnessed all aspects of contest.

The Indian insurance market conventionally focused around life insurance until recently, a

various range of other insurance policies covering sectors like medical, automobile, health and

other classes falling under general insurance came up, generally provided by the private

companies. The life insurance of India added 7% to the GDP of the economy in 2009, an

immense growth since 1999, when the gates were opened for the private company in the market.

List of Life Insurance companies in India till 20111. Life Insurance Corporation of India 2. MetLife India Life Insurance 3. ICICI Prudential 4. Bajaj Allianz Life Insurance 5. Max New York Life Insurance 6. Sahara Life Insurance 7. TATA AIG Life Insurance 8. HDFC Standard Life 9. Birla Sunlife 10. SBI Life Insurance Company Limited 11. Kotak Life Insurance

Page 28: somendra kumar meena

12. Aviva Life Insurance 13. Reliance Life Insurance Company Limited – Formerly known as AMP Sanmar LIC 14. ING Vysya Life Insurance 15. Shriram Life Insurance 16. Bharti AXA Life Insurance Co Ltd 17. Future Generali Life Insurance Co Ltd 18. IDBI Fortis Life Insurance 19. AEGON Religare Life Insurance 1 20. DLF Pramerica Life Insurance 21. Canara HSBC Oriental Bank of Commerce Life Insurance 22. Star Union Dai-ichi Life Insurance Co. Ltd. 23. IndiaFirst Life Insurance Company

Major players in the market:

Top 10 Players in Insurance Companies in India

Life Insurance Corporation of India

Life Insurance Corporation (LIC) came into existence on 1st September 1956 through the

amalgamation of 154 Indian insurance companies, 16 non-Indian companies and 75 provident.

The amalgamation was achieved with the help of Life Insurance Act passed by the Parliament in

the same year. The LIC was created with the goal of reaching all the insurable people in the

country and providing them financial coverage at a reasonable price. In the year 1956, LIC had 5

zonal offices, 33 divisional offices and 212 branch offices. With time there was a need for a

branch office at every district headquarter and many branches were opened, which raised the pace

of the organization.

LIC now has 2048 fully computerized branch offices, 100 divisional offices, 7 zonal offices and

the corporate office. At present, online premium collection facility is being offered in selected

cities as LIC has tied up with some banks and service providers. For providing customer

satisfaction the organization has introduced various schemes such as ECS, ATM premium

payment facility, IVRS, Info centers which are set up in various cities including Mumbai,

Bangalore, Chennai, Kolkata, New Delhi, Pune and many more. It has also come up with

SATELLITE SAMPARK offices providing easy access to policyholders. LIC has crossed many

milestones and set standards for itself fostering unmatched performance.

Page 29: somendra kumar meena

Bajaj Allianz General Insurance Company Limited

Bajaj Allianz General Insurance Company Limited is a joint venture between Bajaj Auto Limited

and Allianz AG of Germany.

Bajaj Allianz General Insurance came into existence on 2nd May 2001, when it got certification

of Registration from the Insurance and Regulatory Development Authority. Bajaj Auto has a

share of 74%, whereas Allianz has the remaining 26%. In the very first year, the company made a

strong position for itself in the industry and was reckoned amongst the top private insurers. The

premium income of the company as on 31st March 2006 was Rs. 1285 crores, whereas the profit

after tax made was Rs. 52 crores. Bajaj Allianz has a Pan India network covering over 100 towns

from Jammu to Thiruvananthapuram and aims to spread its operations in many other cities.

Bajaj Allianz serves customers in all areas of General and Health Insurance as well as Risk

Management. It has in-depth knowledge of the local market and extensive distribution network

with expertise, stability and experience. It has a capital base of Rs. 147 crores, and is allowed to

serve both the General and Health insurance.

ICICI Prudential Life Insurance Company

ICICI Prudential is a joint venture between ICICI bank and prudential plc, both having strong

operations in their respective countries. ICICI bank is one of the leading banks in India providing

quality financial services and Prudential is an international financial service provider

headquartered at United Kingdom. ICICI and Prudential have respective shares of 74% and 26%.

The Company started operating in December 2000. Currently, total capital with the company is

Rs. 18.15 billion.

ICICI Prudential was the first insurance company in India to receive a National Insurer Financial

Strength rating of AAA (Ind.) from Fitch ratings. It has been given the honour of being among

the Most Trusted Brands in the industry by Economic Times for 3 consecutive years. It has a

network of 450 branches, over 1, 50,000 insurance advisors and 18 banc assurance partners.

As the organization grows and develops, it keeps introducing new range of products and services

and enhancing the quality of plans and solutions given to the customers. The distribution network

Page 30: somendra kumar meena

is one of the best, and is spreading across the length and breadth of the country. As on December

31, 2006, it had made imprints in over 360 cities and towns in India. It has over 1, 75,000

advisors across the country, serving clients with full commitment. It has tied up with ICICI Bank,

Bank of India, and Federal Bank, Lord Krishna Bank, some co-operative banks, NGOs, MFIs and

corporate for making inroads into the rural areas.

ICICI Lombard General Insurance

ICICI Lombard General Insurance Company Limited is a joint venture between ICICI Bank

Limited and Fairfax Financial Holdings Limited. ICICI bank is India's second largest bank;

Fairfax is Canada-based, engaged in general insurance, reinsurance, insurance claims

management and investment management. ICICI Lombard General Insurance Company

commenced its operations in general insurance business in August 2001.

ICICI Lombard is India's number one private insurance company; it is also the first general

insurance company to be given certification of ISO 9001:2000. The company provides simple

and fast documentation, fast claims settlement, online policy issuance, and comprehensive

product line.

It has also been given iAAA rating by ICRA for having highest claims paying ability. In the very

first year of operations, it was able to reach financial breakeven and achieve underwriting

breakeven in the second year. Security is provided through encryption and it is the first company

to provide digitally signed documents. It has been honored as the most Customer Responsive

Company by the Economic Times. A time of India has designated it as the Best Housing

Insurance in the Smart Living Awards by 360 degrees. It has also been awarded Gold Shield for

"Excellence in Financial Reporting". It is among the top three companies to be awarded the

"General Insurance Company of the Year" at the 10th Asia Insurance Industry Awards.

Birla Sun Life Insurance Company Limited

Birla Sun Life Insurance Company Limited (BSLI) is a joint venture between Aditya Birla Group

and Sun Life Financial Inc. BSLI started functioning in March 2001 after getting the certificate of

registration from IRDA.

Page 31: somendra kumar meena

Birla Sun Life Insurance Company Limited introduced unit Linked Life Insurance Solutions in

India. Within a short span of time it was able to establish itself as a leading player in the Private

Life Insurance Industry. It has been innovative and come up with customer-centric products to

provide safety and services. The company has web-enabled IT systems for better customer

services and a strong distribution channel which is easily approachable. The company shows

corporate governance and a high degree of transparency in all business practices. It has

professional knowledge and global expertise of Aditya Birla Group.

Birla Sun life Insurance has been providing first class financial solutions to its customers and has

been amongst the top three private sector life insurance companies.

TATA AIG General Insurance

Tata AIG General Insurance Company Ltd. is a joint venture between Tata Sons and American

International Group, Inc. (AIG). The Tata Group is holding 74 per cent stake and the rest 26

percent is held by AIG. The company has got the expertise, knowledge and strength of both the

organizations. Tata AIG General Insurance Company was founded on January 22, 2001. It offers

general insurance in various categories, such as automobile, home, personal accident, travel,

energy, marine, property and casualty and specialized financial solutions.

Jamsetji Tata founded Tata Group in 1860s. It has an estimated turnover of around US $ 14.25

billion. It has spread its operations in various fields such as steel, power, hotels, airlines, software

services, communications, etc. Some of its major projects have been Tata Tea, Tata Steel, Tata

Chemicals, Titan, Tanishq, Voltas, Westside and Tata Motors. Its imprints are made on the

telecommunication and technology sector. Regarding telecommunications, it is the largest

international long distance service provider. Approximately two- third of the equity of Tata Sons

is held by a host of national institutions in science and technology, medical services and

performing arts. By combining the ethical values with business acumen and fulfilling its

commitment to the nation, it has become one of the largest groups in India.

The organization caters to individuals, small businesses and corporate. Individual plans include

motor, home, accident & health and travel insurance, whereas corporate plans include accident &

health, travel, energy, property, marine and liability plans.

,

Page 32: somendra kumar meena

S

atellite insurance.

The company wants to develop itself as the best general insurance company in the industry. It is

concerned about the society and community, and provides financial security at reasonable prices.

The company gives utmost importance to customer needs and there is transparency in its

operations.

IFFCO Tokyo General Insurance

IFFCO Tokio General Insurance is a customer-centric company aiming to be easily accessible

and approachable to all sections of society. It offers products and services that provide quality at

reasonable cost. The organization has the deep knowledge of IFFCO and thus developed a

business plan that has both stability and integrity.

.The Company focuses on delivering creative solutions to its customers. IFFCO Tokio General

Insurance has 273 employees present in 68 cities, dedicated to give full satisfaction to the

customers. It is the first company to underwrite mega policies for a fertilizer and automobile

client.

The Oriental Insurance Company Ltd.

The Oriental Insurance Company Ltd. (OICL) is one of the general insurance companies under

the support of the General Insurance Corporation (GIC) of India. It came into existence in the

year 1947 and is one of the oldest organizations in India. It caters to all sections and sectors

Ranging from MNCs to rural sector. The headquarters of the company are situated at Delhi and it

has 21 Regional Offices, 311 Divisional Offices and 635 Branch offices.

HDFC Standard Life Insurance Company Limited

Page 33: somendra kumar meena

HDFC Standard Life Insurance Company Limited is one of the first companies to be licensed by

IRDA to operate in the Insurance sector. The company came into existence on 14th August 2000.

Both Crisil and ICRA have honored it with AAA Ratings. Similarly Moody's and Standard and

Poor’s have also honored it AAA ratings. HDFC holds 81.4% share in HDFC and the remaining

18.6% stake is with Standard Life. It integrates the strong expertise and stability of Standard Life

and HDFC.

2.2 BACKGROUND OF THE STUDY:

Investment

Concept of Investment:

Investment is the employment of funds with the aim of generating additional income or growth in

value. It involves the commitment of resources which have been saved or put away from current

consumption in the hope that some benefit will occur in the future.

Investment is putting money into something with the expectation of profit. More specifically,

investment is the commitment of money or capital to the purchase of financial instruments or

other assets so as to gain profitable returns in the form of interest, dividends, or appreciation of

the value of the instrument capital gains. It is related to saving or deferring consumption.

Investment is involved in many areas of the economy, such as business management and finance

no matter for households, firms, or governments. An investment involves the choice by an

individual or an organization, such as a pension fund, after some analysis or thought, to place or

lend money in a vehicle, instrument or asset, such as property, commodity, stock, bond, financial

derivatives (e.g. futures or options), or the foreign asset denominated in foreign currency, that has

certain level of risk and provides the possibility of generating returns over a period of time.

Investment comes with the risk of the loss of the principal sum. The investment that has not been

thoroughly analyzed can be highly risky with respect to the investment owner because the

possibility of losing money is not within the owner's control. The difference between speculation

and investment can be subtle. It depends on the investment owner's mind whether the purpose is

for lending the resource to someone else for economic purpose or not.

In the case of investment, rather than store the good produced or its money equivalent, the

investor chooses to use that good either to create a durable consumer or producer good, or to lend

the original saved good to another in exchange for either interest or a share of the profits. In terms

of financial assets, these are often marketable securities such as a company stock (an equity

investment) or bonds (a debt investment). At times, the goal of the investment is to produce

Page 34: somendra kumar meena

future cash flows, while at others it may be for the purpose of gaining access to more assets by

establishing control or influence over the operation of a second company (the investee).

Business firms or organizations raise funds from investors in the form of equities and debts

(collectively known as the capital structure) and further reinvest it into various investment

schemes by carefully analyzing the returns in order to meet out their obligations relating to

purchase of assets which provides them long term benefits.

In finance

In finance, investment is the commitment of funds by buying securities or other monetary or

paper (financial) assets in the money markets or capital markets, or in fairly liquid real assets,

such as gold or collectibles. Valuation is the method for assessing whether a potential investment

is worth its price. Returns on investments will follow the risk-return spectrum.

Types of financial investments include shares, other equity investment, and bonds (including

bonds denominated in foreign currencies). These financial assets are then expected to provide

income or positive future cash flows, and may increase or decrease in value yielding the investor

capital gains or losses.

Investments are often made indirectly through intermediaries, such as banks, mutual funds,

pension funds, insurance companies, collective investment schemes, and investment clubs.

Though their legal and procedural details differ, an intermediary generally makes an investment

using money from many individuals, each of whom receives a claim on the intermediary.

Within personal finance, money used to purchase shares, put in a collective investment scheme or

used to buy any asset where there is an element of capital risk is deemed an investment. Saving

within personal finance refers to money put aside, normally on a regular basis. This distinction is

important, as investment risk can cause a capital loss when an investment is sold, unlike saving(s)

where the more limited risk is cash devaluing due to inflation.

In many instances the terms saving and investment are used interchangeably, which confuses this

distinction. For example many deposit accounts are labeled as investment accounts by banks for

marketing purposes. Whether an asset is a saving(s) or an investment depends on where the

money is invested: if it is cash then it is savings, if its value can fluctuate then it is investment. So

people invest in various financial products as well as saving schemes and in insurance sector

according to their needs, time horizon, level of risk and the return potential of the particular

product.

Concept of Insurance

Page 35: somendra kumar meena

Insurance is a type of financial arrangement that helps individuals, businesses and other

organizations protect themselves against unexpected or unpredictable losses or expenses.

Insurance can protect against a variety of losses or damage such as personal injury and property

damage.

It is related to the protection of economic value of assets.

Mechanism of insurance business is based on people with similar risk coming together and

sharing the loss.

It protects the economic value of an Asset thereby helping the individual to overcome an

unexpected loss of income or drain of saving.

Function

Insurance companies sell insurance policies that protect people from losses associated with

specific unplanned events. If the unplanned events covered by the insurance policy occur, the

insurance company will pay the person with the insurance policy a certain amount of money as

set out in the rules of the plan. For instance, you could purchase an insurance policy for damages

to your home and the insurance company pay for damages if the home was affected by a fire or

other events covered by the plan.

Types

Based on Today’s life style the list of types of insurance is increasing day by day. The main types

of insurance policies available in the market are:

1) Life Insurance: In this policy, the insurance company pays in case of the demise of the policy

holder or at the time of the maturity of the policy. Now a day a new policy has been launched by

LIC in which you will be covered under the insurance policy even after the maturity of the policy

2) Property Insurance: This insurance helps you to prevent the losses against theft, fire,

burglary or any natural calamity like Earthquake, Floods etc. based on the points mentioned in

the policy.

3) Health Insurance: Health Insurance consists of a package of various types of insurance

related to health. For example Medical Insurance is one the major part of health insurance

however in most of the cases, dental issues are not covered in this policy so there is another

Dental Insurance policy which covers dental problems and is also a part of health insurance. The

subcategory of health insurance also involves the injuries or accident at workplace insurance

benefits.

Page 36: somendra kumar meena

4) Auto Insurance: Any financial loss due to accident of a vehicle is covered under the auto

insurance policy. Sometimes the expenses on the medicines for treating injuries and all other

medical expenditure are also covered under this policy.

5) Travel Insurance: Loss of personal belongings while traveling, medical coverage, delays in

the travel are all part of the travel insurance policy.

6) Insurance at Amusement Points: This is a one of the new kinds of insurance policy (not very

popular in India) where in you are insured against the equipments that you are using at the

amusement joints. For example: if you are using boats for an independent boat ride , then they

will charge you with some extra money for an property loss(say $5) and in case of any property

damage you will not be liable to pay any amount required to repair the damaged property.

7) Credit Insurance: This type of insurance pays the loans of the policy holder in case of any

accident of the policy holder or job loss or death.

Third Party Insurance: This type of insurance covers damages caused by you (first party) to

others (third party). For more details visit third party insurance.

Apart from these above mentioned insurance policies there are many other types of insurance

policies in the market (and the list keeps on increasing) that are more or less related to these

policies however providing benefits to the policy holders in a different and unique way.

Insurance is basically divided into two categories as

TYPES OF INSURANCE

(A) Life Insurance

Term Life Insurance

Permanent Life Insurance

(B) General Insurance

Fire Insurance

Marine Insurance

Accident Insurance

(A)Life Insurance

Life Insurance is a contract providing for payment of a sum of money to the person assured or,

following him to the person entitled to receive the same, on the happening of a certain event. It is

a good method to protect your family financially, in case of death, by providing funds for the loss

of income.

Page 37: somendra kumar meena

A1. Term Life Insurance: Under a Term Life contract, the insurance company pays a specific

lump sum to the designated beneficiary in case of the death of the insured. These policies are

usually for 5, 10, 15, 20 or 30 years.

Term life insurance are the most popular in advance countries but were not so popular in India.

However, after the entry of the private operators and aggressive marketing by few players this

kind of policies are becoming popular. The premium on such type of policies is comparatively

quite low when compared with other types of life insurance policies, mainly due to the fact that

these policies do not carry cash value.

Plus of Term Life Insurance

- The premium payable on these policies is low as they do not carry any cash value.

- One can afford for quite high value insurance policies

Minus of Term Life Insurance

- If one survives the period of the policy, he / she does not get any money at the end of the

policy.

The premium on such policies keeps on increasing with age mainly because the risk of death of

older people is more. Over the page of 60, these policies become difficult to afford.

A2. Permanent Life Insurance:

In a Permanent Life contract, a portion of the money paid as premiums is invested in a fund that

earns interest on a tax-deferred basis. Thus, over a period of time, this policy will accumulate

certain "cash value" which you will be able to get back either during the period of the policy or at

the end of the policy.

Your need for life insurance can change over a lifetime. At any age, you should consider your

individual circumstances and the standard of living you wish to maintain for your dependents. In

most cases, you need life insurance only if someone depends on you for support. Your life

insurance premium is based on the type of insurance you buy, the amount you buy and your

chance of death while the policy is in effect. This type of policy not only provides protection for

your dependents by paying a death benefit to your designated beneficiary upon your death, but it

also allows you to use some part of the money while you are alive or at the end of the policy.

Some examples of such policies are: - Whole Life, Universal Life and Variable-Universal Life.

Endowment Policy:

These policies provide for period payment of premiums and a lump sum amount either in the

event of death of the insured or on the date of expiry of the policy, whichever occurs earlier.

Money Back Policy:

Page 38: somendra kumar meena

These policies provide for periodic payments of partial survival benefits during the term of the

policy itself. A unique feature associated with this type of policies is that in the event of death of

the insured during the policy term, the designated beneficiary will get the full sum assured

without deducting any of the survival benefit amounts, which have already been paid as money-

back components. Moreover, the bonus on such policies is also calculated on the full sum

assured.

Annuity/Pension Policy/Funds:

This policies / funds require the insured to pay the premium as a single lump sum or through

installments paid over a certain number of years. The insured in return will receive back a

specific sum periodically from a specified date onwards (the returns can be monthly, half yearly

or annually), either for life or for a fixed number of years. In case of the death of the insured, or

after the fixed annuity period expires for annuity payments, the invested annuity fund is refunded,

usually with some additional amounts as per the terms of the policy.

Annuities / Pension funds are different from all other forms of life insurance as an annuity

policy / fund does not provide any life insurance cover but merely offers a guaranteed income

either for life or a certain period. Therefore, this type of insurance is taken so as to get income

after the retirement.

(B) General Insurance:

General Insurance includes those insurance policies which are not covered under life insurance.

General insurance provides protection against risk of loss to assets like home, motor vehicle, etc.

Common general insurance plans include motor insurance, fire insurance, personal accident

insurance, health insurance, marine insurance etc. The most popular general insurance plans are

mentioned hereunder:

B1. Fire Insurance:

A

PROBLEM:

Page 39: somendra kumar meena

COMPANY PROFILE:

ING- Company Profile:

ING was founded in 1991 by a merger between Nationale-Nederlanden and NMB Postbank

Group. During the past years ING has become a multinational with diverse international

activities.

The roots of ING can be traced to the insurers De Nationale Levensverzekering Bank and De

Nederlanden van 1845 and to the public bank services such as De Rijkspostspaarbank and De

Postcheque- and Girodienst, as well as to the Nederlandsche Middenstands Bank. These are the

legal predecessors of the ‘founding fathers’ of ING: Nationale-Nederlanden and NMB Post bank

Group.

The founding of ING as one company was started in 1990 when the legal restrictions on mergers

between insurers and banks were lifted in the Netherlands. This prompted insurance company

Nationale-Nederlanden and banking company NMB Post bank Group to enter into negotiations.

The merger into Internationale Nederlanden Group took place in 1991. The market soon

abbreviated the name to I-N-G. The company followed suit by changing the statutory name to

ING Groep N.V. Since 1991, ING has developed from a Dutch company with some international

business to a multinational with Dutch roots. This was achieved through a mixture of organic

growth, such as the creation of ING Direct from scratch, as well as various large acquisitions.

The first large acquisition took place in 1995, when ING took over Barings Bank. This

acquisition increased the brand recognition of ING around the world and strengthened its

wholesale banking presence in the emerging markets. And then there was Life of Georgia. This

insurance company was acquired by Nationale-Nederlanden in 1979, resulting in a significant

increase in activities in the US. Via Life of Georgia, the activities in Asia expanded considerably.

However in 2004, ING as a group had become well-established in both regions and Life of

Geogeria was sold. Other acquisitions, such as the Belgian Bank Brussels Lambert, strengthened

Page 40: somendra kumar meena

the Group’s presence in the Benelux. In addition, the activities in de United States were doubled

as a result of organic growth and the acquisition of Equitable of Iowa, ReliaStar, Aetna

financial services and merchant bank furman Selz

Profile

ING has gained recognition for its integrated approach of banking, insurance and asset

management. Furthermore, the company differentiates itself from other financial service

providers by successfully establishing life insurance companies in countries with emerging

economies, such as Korea, Taiwan, Hungary, Poland, Mexico and Chile. Another specialization

is ING Direct, an Internet and direct marketing concept with which ING is rapidly winning retail

market share in mature markets. Finally, ING distinguishes itself internationally as a provider of

‘employee benefits’, i.e. arrangements of nonwage benefits, such as pension plans for companies

and their employees.

About ING Group

ING is a global financial institution of Dutch origin offering banking, insurance and asset

management to over 85 million private, corporate and institutional clients in over 40 countries.

With a diverse workforce of approximately 130,000 people, ING is dedicated to setting the

standard in helping our clients manage their financial future.

About ING in India

ING operates through three businesses in India, ING Vysya Life Insurance, ING Vysya Bank and

ING Investment Management. ING Vysya Bank is a premier private sector bank with over 76-

year heritage and 1.5 million satisfied customers. ING Investment Management believes in

providing investors with the knowledge & opportunity to manage their future easily.

ING Life India, in its 10th year of operations, is a part of the ING Group. ING Life entered the

private life insurance industry in India in September 2001. The company has issued over 1

million policies and is staffed by over 6500 employees.

Headquartered in Bangalore, ING Life India is currently present in 229 cities across 251 branch

offices. In addition, the company distributes its products in several parts of the country through

its partner's presence.

ING Life India distributes its products through two channels, the Tied Agency Force and the

Alternate Channel. The Tied Agency force comprises over 50,000 ING Life Advisors, spread

across the country. The Alternate Channels business within ING Life India is a fast growing

Page 41: somendra kumar meena

distribution channel, and includes the Banc assurance partner (ING Vysya Bank), Referral

Partners, Corporate Agents and Brokers.

ING was established as a Naamloze Vennootschap (public limited liability company) on March

4, 1991, through the merger of Nationale-Nederlanden, which was the largest insurer in the

Netherlands, and NMB Postbank Group, which was one of the largest banks in the Netherlands.

ING Group N.V. is incorporated under the laws of the Netherlands.

History of the ING Lion:

ING’s orange lion goes way back to ING’s Dutch roots. Orange is the national color of the

Netherlands, and the lion the country’s national symbol. Several founding ING companies, banks

and insurers, had or still have the lion in their logos.

Logo’s from banking history of ING:

One of ING’s founding companies; the Rijkspostspaarbank was established in 1881.

Government-owned, the company had the Dutch coat of arms flanked by two lions in its logo

surmounting the motto ‘je maintiendrai’ (I will maintain). In the 1950s and 1960s, another ING

founding company, the Nederlandsche Middenstandsbank (NMB), used the same logo on its

stationery and official documents.

The logo was modernized several times in the course of the merger of Rijkspostspaarbank and the

Postcheque- & Girodienst into Postgiro/Rijkspostbankspaarbank, culminating in privatization as

the Postbank in 1986. The lion rampant became recumbent, lost a little of its wild mane and

acquired a longer tail.

Page 42: somendra kumar meena

Logos from our insurance history The original insurance companies, De Nederlanden van 1845

and the Nationale Levensverzekering-Bank, both had lions in their logos. For a long time De

Nederlanden van 1845 used the Dutch coat of arms. The Nationale had a logo depicting a virgin

with a lion at her feet, symbolizing the company’s courage in looking after its customers’ savings

deposits. The two companies merged and became Nationale-Nederlanden

The lion survived

The logo was very much a negotiating issue when NMB and Postbank merged, and later on when NMB Postbank Group and Nationale-Nederlanden joined forces but the lion has survived all mergers.

ING current logo

The orange lion adorns their global ING logo.

Business Divisions: ING is serving its services in three fields of areas which are as follows:

Page 43: somendra kumar meena

3.1 COMPANY OBJECTIVE:

ING aims to deliver financial products and services in the way that our customers want them delivered: with exemplary service and maximum convenience at competitive prices.

3.2 ING – MISSION

Mission statement: To set the standard in helping our customers manage their financial future.

ING- Tag Line:

Shaping our future

ING LIFE INDIA-CURRENT SHAREHOLDING:

26% 50%

Page 44: somendra kumar meena

11.53% 12.47%

ING PARTENERS IN INDIA:

5. Exide Industries Limited-is the market leader in both automotive and industrial segments.

‘EXIDE’ and ‘SF’ (Standard Furukawa), the flagship brands of the Company, which are the

leading battery brands in the country.

6. Rajan Raheja the promoter of the group is ranked 30 th by Forbes among Indians by New

worth... His Net worth stands at: $2.15 billion.

7. Gujarat Abuja Cements Ltd.-the third largest cement company in India.

8. Enam Group-Enam Group is one of India’s leading financial service providers reputed for its

ability to perceive the true potential of businesses and enhance their value. The culture at

Enam Group is deeply rooted in ethics, innovation and financial sobriety.

3.3 COMPANY HIERARCHY:ING -ORGANIZATION STRUCTURE IN INDIA

Kshitij Jain MD & CEO

Rahul AgarwalChief Distribution Officer

B.AshwinChief Operating Officer

John BoersChief Financial Officer

Uco VegterChief Marketing & Strategy Officer

Priya GDirector Human Resource

Parag MathurLegal Counsel, Company Secretary

Page 45: somendra kumar meena

Organization Structure-Regional Level

3.4 PRODUCT PORTFOLIO:Insurance Products of ING:

ING Life Insurance aims to make customers look at life insurance afresh, not just as a tax saving

device but as a means to live life to the fullest. It believes in enhancing the very quality of life, in

addition to safeguarding an individual's security.

The Company follows a “customer centric approach” while designing its life insurance products.

The ING Life product portfolio offers products that cater to every financial requirement, at all life

stages.

The various insurance plans of ING VYSYA are as follows:

i. Children Plans

Regional Vice President

Area Training Manager Area Managers

Branch Manager Agency Manager

Training Manager Customer Service Manager

Branch Coordinator

SM GSMs

Advisors

FCs

AdvisorsAdvisors

ASM

Advisors

BDE Advisors

CSE

Page 46: somendra kumar meena

i. ING Aashirvad

ii. Creating Life Child Protection Plan

iii. Creating Life Money Back Plan

ii. Protection Plans

i. ING Term Life

ii. ING Term Life Plus

iii. Savings Plans

i. Reassuring Life Endowment Plan (Reversionary Bonus)

ii. Safal Jeevan Endowment Plan

iii. Safal Jeevan Money Back Plan

iv. ING Creating Star Guaranteed Future

iv. Retirement Plans

ING New Best Years

ING Immediate Annuity

v. Investment Plans

a. ING Ace Life

b. ING Ace Pension

c. ING Prospering Life SP

d. ING Market Shield

e. ING Prospering Life

f. ING Uttam Jeevan - Regular Premium

g. ING Uttam Jeevan - Single Premium

h. Powering Life

Page 47: somendra kumar meena

i. Platinum Life

j. New Fulfilling Life

vi. Group Products

a) ING Smart Shield

b) Group Gratuity

c) Employee Deposit Linked Insurance

d) Group Term Life Insurance Plan

e) Single Premium Level Term Plan

Children plans:

In today's day and age it is all about providing that extra to give your little ones the edge over

others. Keeping this objective in mind, ING Life launches its new design amongst child plans that

will help revolutionize your approach towards planning for your child's future.

The various children plans of ING are as follows:

A. ING Aashirvad: ING Aashirvad is a guaranteed child life insurance plan that pays out monies

and helps you plan for the career and marriage of your children. In this plan the parent and child

are the life insured/s during the policy term and once your child's future is adequately secured

through the education and marriage payouts, the benefit of long term insurance protection shifts to

the child during the extended policy term.

B. Creating Life Child Protection Plan:

Creating Life Child Protection Plan ensures that your child’s future is secure in case of your

untimely death. It also creates a financial asset for your child. It provides the sum assured to your

child immediately after your untimely death. what’s more, on maturity, an additional sum assured

is paid with an accumulated compounded revisionary bonus and a final additional bonus.

C. Creating Life Money Back Plan:

The creating life child protection money back plan is a unique plan that fulfills your need for

protection, saving, retirement and investment. It gives a double benefit of a life cover along with

periodic cash returns during the term of the policy.

Page 48: somendra kumar meena

Protection Plan:

Our Protection Plans help you ensure that your family continues to enjoy a comfortable lifestyle

even in your absence. We make available a variety of plans to provide you with the flexibility of

choosing one that fits your and your family's needs the best. We recognize protection as the basic

insurance need and have therefore kept our products comprehensive yet economical for you. The

various protection plans of ING are as follows:

1. ING Term Life

Simplest and most economical form of term life insurance. Large sum assured at highly

affordable premium rates.

2. ING Term Life Plus

Term insurance product with return of premium. Large sum assured at affordable premium rates.

Savings Plans:

Our Saving Plans help you achieve your life goals making them cherished moments for you and

your family. They provide you with the flexibility to save for your future requirements while you

continue to improve your current lifestyle. Our plans help discipline your savings approach and

point your efforts towards defined goals so that whatever stage of life you are in, you are always

in control and self-reliant.

a. Reassuring Life Endowment Plan (Reversionary Bonus): Savings plan with a highly reliable

safety net for your family in case something happens to you.

b. Safal Jeevan Endowment Plan: Comprehensive protection and savings plan with an in-built

accident cover. Option to choose from a pre-packaged range of fixed terms and premiums.

c. Safal Jeevan Money Back Plan: Ideal plan as a first life insurance policy. Choose a suitable

policy term from pre-packaged solutions. Payouts at regular intervals during policy term.

d. ING Creating Star Guaranteed Future: ING Assured Returns (Withdrawn) from this plan

- The Guaranteed Interest Rate declared for the 2nd Policy year is 9%,

- The rate for a Delayed Payment Interest rate is 5.5%*.

* (including Account Administration Fees of 1.25%)

Retirement plan:

Our Retirement Plans ensure that you lead your life after retirement on your own terms, doing

things you have always dreamt of. We also believe it is important to be in control of your

Page 49: somendra kumar meena

retirement planning. Our innovative features help you choose your retirement age and also

control the way your investments are managed keeping in mind your retirement needs.

a. ING New Best Years:

Retirement plan with capital guarantee and plenty of flexibility, to help build a sizeable financial

asset for you or your family, in case you’re not around.

b. ING Immediate Annuity :

A plan that gives you a guaranteed income throughout your retired life and more.

Investment Plans:

Our Investment Plans are created keeping your needs in mind. We appreciate the flexibility

required to suit your risk appetite and the commitments you may want to make. Our global

expertise in managing wealth for individuals at all stages in their life ensures that we have

products to suit your taste whatever your objective of investing may be.

1) ING Ace Life

ING Ace Life is a non-linked non-participating limited premium payment (3 years) endowment

plan that provides guaranteed additions for the entire policy term of 10 years.

2) ING Ace Pension

ING Ace Pension is a non-linked non-participating limited premium payment (3 years) pension

plan that provides guaranteed additions for the entire policy term of 10 years. The Guaranteed

Vesting Benefit at the end of the Policy Term will be used to purchase annuity which will help

you in your post retirement years.

3) ING Prospering Life SP

ING Prospering Life SP is a Single Premium Unit Linked Insurance Plan which maximizes

returns over the long term (10-years) by providing choice of 6 investment funds with just a single

contribution.

4) ING Market Shield

ING Market Shield not only provides life cover but also balances risk and reward in a transparent

manner and provides you an opportunity to enjoy growth while retaining protection. It is a Unit

linked life insurance plan that ensures you never miss an opportunity to maximize your gains and

at the same time limits your losses.

5) ING Prospering Life

Page 50: somendra kumar meena

An excellent Unit Linked Life Insurance plan for wealth creation while enjoying control over

your assets at all times.

6) ING Uttam Jeevan - Regular Premium

A long term investment tool with market linked returns and increasing Life Cover to secure

financial protection for the customer's family at every stage of life.

7) ING Uttam Jeevan - Single Premium

ING Uttam Jeevan SP is a simple, easy to understand plan which fulfills customer’s needs of

investment and protection. It is a unique Single Premium unit linked plan which can help you

strike your future worries in one shot. Pay once and enjoy the benefits for the term of the policy.

8) Powering Life

Investment plan with high reversionary bonus. Premium payments for a short period of time, life

cover for a longer period and high maturity benefits.

9) Platinum Life Plan

Investment plan with a10 year duration. Simple guaranteed additions on sum assured apart from

bonuses and loan facility.

10) New Fulfilling Life Plan

Investment plan with double benefit of periodic cash returns during policy term and maturity or

death benefit.

Group Products:

A variety of plans to provide a cost effective yet comprehensive cover in an efficient manner to

all your employees, helping you attract and retain the best of talent. The various group products

are as follows:

1. ING Smart Shield

ING Vysya Life Insurance is proud to introduce its new group insurance product “ING Smart

Shield” for credit related insurance. Credit related insurance is sold in conjunction with credit,

where the policy terms and benefits are related to specific consumer credit obligation. This kind

of arrangement is made between insurer and banks/financial institutions offering personal,

educational, agriculture, auto and other consumer loans. It can also be targeted at deposit

products, such as recurring deposits and systematic investment plans of mutual funds, where a

Page 51: somendra kumar meena

sum assured can be of a decreasing nature and a schedule similar to outstanding loan schedule

can be drawn.

A master policy will be issued to the bank/financial institution to cover existing and new

customers for the entire tenure of their respective financial products. The premium will be paid

by the bank/financial institution. The cover at any point of time in respect of a member will be

based on the schedule of death benefit drawn at inception.

in the event of unfortunate death of your employee. This can be done in a tax efficient and hassle

free manner through this plan.

in the group.

2. Single Premium Level Term Plan

The associates in your business are the life of your organization. It is they who are your most

valuable asset and enhance your company's worth. Your challenge is to keep them happy,

motivated and most importantly, to make them remain with you. Our Single Premium Term

Assurance primarily caters to the mortgage groups – like Banks and Housing Finance companies

such as your organization. ING Life's Single Premium Level Term plan ensures that your client's

families are protected in the event of an unfortunate death. You can ensure that their financial

security is assured, when they need it most. This Single Premium Insurance plan provides for

payment of sum assured for the benefit of the beneficiaries in the event of death of your client.

Operational policy of KYC at ING:

Know Your Customer (KYC)

KYC is an acronym for “Know your Customer”, a term commonly used for Customer

Identification Process. The Prevention of Money Laundering Act, 2002 (“PMLA”) forms the core

of the legal framework put in place by the Indian Regulators to combat money Laundering to be

followed by banking companies, financial institutions and intermediaries by administering KYC

process and other reporting requirements such as suspicious transactions reporting, etc. SEBI has

Page 52: somendra kumar meena

prescribed certain requirements relating to KYC norms for Financial Institutions and Financial

Intermediaries (such as Mutual Funds) to ‘know’ their customers. This would be in the form of

verification of identity and address, providing information of financial status, occupation and

such other demographic information. Applicant must be KYC compliant while investing with any

SEBI registered Mutual Fund.

Thus, with effect from February 01, 2008, all investors (Individuals or Non Individuals) who

wish to make an investment of Rs. 50,000 or above in a mutual fund scheme will be required to

complete the KYC process. This would also apply to new Systematic Investment Plan (SIP)

registrations on or after 01 February 2008, if each SIP installment is of value greater than or

equal to Rs. 50,000. This one-time verification is valid for transactions across all mutual funds.

The process for KYC is as follows:

1. A completed KYC application form along with the documents/information as mentioned in point

(3) below should be submitted to any point of service (POS).

2. A KYC application form is available at the investor service centers of the Fund and CAMS or

any designated ‘Points of Service’ (POS) of CSDL Ventures Ltd.

3. The documents required to be submitted along with the KYC application form are:

a) Recent Passport size photograph,

b) PAN card copy,

c) Address proof and

d) Detail of occupation and income. (The detailed list of documents/information required

and instructions to fill the form can be found in the KYC application form).

4. After verification of the KYC application form and accompanying documents, investors will

receive a letter certifying their KYC compliance. There is no charge for this verification.

5. When investing with the Fund, a copy of this letter should be attached to the scheme’s application

form to avoid rejection.

6. If you already have a Mutual Fund Identification Number (“MIN”) (not valid anymore) and you

have not provided PAN at the time of obtaining MIN, you are requested to complete the PAN

formalities mentioned above to be KYC –compliant.

Guidelines on “Know Your Customer” norms and “Cash transactions” by RBI:

As part of ‘Know Your Customer’ (KYC) principle, RBI has issued several guidelines relating to

identification of depositors and advised the banks and companies to put in place systems and

procedures to help control financial frauds, identify money laundering and suspicious activities,

and for scrutiny/monitoring of large value cash transactions. Instructions have also been issued

Page 53: somendra kumar meena

by the RBI from time to time advising banks to be vigilant while opening accounts for new

customers’ it prevent misuse of the banking system for perpetration of frauds. Taking into

account recent developments, both domestic and international, it has been decided to reiterate and

consolidate the extent instruction on KYC norms and cash transactions. The following guidelines

reinforce our earlier instructions on the subject with a view a to safeguarding banks from being

unwittingly used for the transfer or deposit of funds derived from criminal activity (both in

respect of deposit and borrower account) , or for financing of terrorism. The guidelines are also

applicable to foreign currency accounts/transactions.

‘Know Your Customer’ (KYC) guidelines for New accounts:

The following KYC guidelines will be applicable to all new accounts with immediate effect.

1. KYC Policy:

i. “Know Your Customer” (KYC) procedure should be the key principle for identification of an

individual/corporate opening an account. The customer identification should entail verification

through an introductory reference from an existing account holder/a person knows to the bank or

on the basis of documents provided by the customer.

ii. The Board of Directors of the banks should have in place adequate policies that establish

procedures to verify the bona fide identification of individual/corporate opening an account. The

Board should also have in place policies that establish processes and procedures to monitor

transactions of suspicious nature in accounts and have systems of conducting due diligence and

reporting of such transactions.

2. Customer Identification:

The objectives of the KYC framework should be two fold,

a. To ensure appropriate customer identification and

b. To monitor transactions of a suspicious nature. Banks should obtain all information necessary to

establish the identity/legal existence of each new customer, based preferably on disclosures by

customers themselves. Typically easy means of establishing identity would be documents such as

passport, driving license etc. However where such documents are not available verification by

existing account holders or introduction by a person known to the bank may suffice. It should be

ensured that the procedure adopted does not lad to denial of access to the general public for

banking services.

In this connection, we also invite a reference to Report on Anti Money Laundering Guidelines for

Banks in India prepared by a Working Group has made several recommendations for

strengthening KYC norms with anti money laundering focus and has also suggested formats for

Page 54: somendra kumar meena

customer profile, account opening procedures, establishing relationship with specific categories

of customers, as well as an illustrative list of suspicious activities.

“Know Your Customer” procedures for existing customers:

Banks and Companies are expected to have adopted due diligence and appropriate KYC norms at

the time of opening of accounts in respect of existing customers in terms of our extant

Instructions referred to in the Annexure. However, in case of any omission, the requisite KYC

procedures for customer identification should be got completed at the earliest.

ING’S Policy on Know Your Customer:

INTRODUCTION:

“Know your Customer” (KYC) is a set of guidelines aimed at preventing banks from being used

intentionally or unintentionally by criminal elements for committing financial frauds, transferring

or deposits of funds derived from criminal activity or for financing terrorism. This policy

document is a consolidation of various guidelines issued by Reserve Bank as also our Bank for

proper identification of an account holder/customer and for scrutiny/ monitoring of large value

cash transaction or transaction of a suspicious nature. This KYC policy is applied to the whole

group of ING (with minor required changes) which includes its three business divisions of

Banking, Insurance and Asset management.

OBJECTIVES OF KYC POLICY

1. To lay down explicit criteria for acceptance of customers.

2. To establish procedures to verify the bona-fide identification of individuals/non individuals for

opening of account.

3. To establish processes and procedures to monitor high value transactions and / or transactions of

suspicious nature in accounts.

4. To develop measures for conducting due diligence in respect of customers and reporting of such

transactions.

Page 55: somendra kumar meena

DEFINITION OF CUSTOMER

For the purpose of KYC policy, a “customer” will be defined as:

A person or entity or entity that maintains an account and/ or has a business relationship with the

Bank,

One on whose behalf the account is maintained (i.e. the beneficial owner),

Beneficiaries of transactions conducted by professional intermediaries such as Stock as Brokers,

Chartered Accountants, Solicitors etc. as permitted under the law, and

Any person or entity connected with a financial transaction which can pose significant reputation

or other risks to the Bank, say a wire transfer or issue of a high value demand drafts as a single

transaction.

CUSTOMER ACCEPTANCE

a. The bank will have an elaborate standard for

i. Obtaining comprehensive information regarding new customers at the initial stage

and that of existing customers over a predetermined period, thereby establishing the

bona fides of customers opening accounts with the Bank.

ii. For identifying high value transactions and transactions of a suspicious nature and

keeping a watch on such transactions as well as for reporting them to law enforcing

Regulatory authorities.

b. The Bank will lay down/ spell clearly the document requirements and other information to

be collected in respect of different categories of customers depending on perceived risk

and keeping in mind the guidelines issued by Reserp7po67y.ve Bank of India from time

to time;

c. The Bank will ensure that a new account is not opened or an existing one is not closed

where the Bank is unable to apply due diligence measures i.e. unable to verily the identity

and/or obtain documents required as per the risk categorization due to non cooperation of

the customer or non-reliability of the data/information furnished to the Bank. It will,

however, have suitable built-in safeguards to avoid harassment of the customer. For

example, decision to close an account will be taken at the level of controlling office after

giving due notice to the customer explaining the reasons for such a decision;

Page 56: somendra kumar meena

The Bank will ensure that circumstance in which a customer is permitted to act or behalf of

another person/ entity will be clearly spelt out in conformity with established law and practice of

banking as there could be occasions when an account is operated by a mandate holder or where

an account is opened by an intermediary in the fiduciary capacity;

d. The bank will ensure that before opening an account there are adequate checks to ensure

that the identity of the customer does not match with any person with known criminal

back ground or with banned entities like individual terrorist or terrorist organizations.

1. CUSTOMER IDENTIFICATION

Identification is an act of establishing who a person is in the context of KYC it means establishing

who a person purports to be and will involve identifying the customer and verifying his/ her

identities by using reliable and independent source documents, data or information. For this

purpose the Bank will obtain sufficient information necessary to establish to is satisfaction the

identity of each new customer, whether regular or occasional and the purpose of the intended

nature of banking relationship.

a. His/her address/location and(c) his/her recent photograph. The true identity and bona

fides of the existing customers and new potential customers opening accounts with the

Bank and obtaining basic background information would be paramount importance.

For customers that are legal person or entities the Bank will….

2. VERIFICATION OF GENUINENESS OF ADDRESS:

In all instances of opening of new accounts a letter of thanks will be sent by the Bank by

registered post at the recorded addresses to all customers and introducers with dual

purpose, thanking them for opening the account with the Bank and for verification of

genuineness of address furnished by the account holder. Undelivered envelopes in this

regard will be followed up closely at the branch level. The Branch may also contact the

customer at the telephone number provided in the account opening form or other

documents to verify the address and other details.

3. CUSTOMER PROFILE:

For the purpose of exercising due diligence on individual transactions in accounts, a

‘Customer Profile’ of individual account holders will be included in the account opening

forms. The customer profile will contain information relating to the customers identity,

social / financial status, nature of the business activity, information about the customers

clients’ business and their location etc. While preparing the customer profile the Bank will

Page 57: somendra kumar meena

take care to seek only such information from the customer which is relevant for the purpose of

risk categorization and is not intrusive. The customer profile will be a confidential document

and the details contained therein will not be divulged for cross selling or any other purpose.

The information will be of two types namely mandatory and optional as stated below:

A. Mandatory Information:

Occupation, Source of funds, Monthly Income, Annual turnover, Date of Birth Any relative

settled abroad, Dealings with other banks, Existing credit facilities , Assets (Approximate value).,

Expected turnover.

B. Optional Information:

Marital Status; Education Qualification; Educational Qualification of spouse; Details regarding

children; Information like- Owns a car/two wheeler, have credit card etc.

4. OBTAINING INTRODUCTION:

The Bank generally insists on introduction by a known person. Introduction is a process of

ascertaining the identity of a person and is acceptability for establishing business relationship

and verifying the true identity of the intending customer before opening an account. When the

Bank opens an account in the name of a customer, it has to render a number of services,

including collection of cheques, in the ordinary course of business. It is, therefore, essential

that the Bank is aware of the credentials of the prospective customer such as his profession,

business address etc. through proper introduction and verification of antecedents of the

account holder in each and every account.

5. IDENTIFICATION OF HIGH VALUE/SUSPICIOUS TRANSACTIONS/TERRORISM

FINANCE

Ongoing monitoring is an essential element of effective KYC procedure. Bank can effectively

control and reduce its risk only if it has an understanding of the normal and reasonable

activity of the customer so that it has the means of identifying transactions that fall outside the

regular Pattern of activity.

6. MONITORING OF CASH TRANSACTION:

The cash transactions will be monitored in the following manner:

a. The issuance of travelers cheques, demand drafts, mail transfers, and telegraphic transfer

for Rs.50000/- and above will be permitted only by debit to customers’ accounts or

against cheques and not against cash. Further, the applicants (whether customers or not)

Page 58: somendra kumar meena

for the above transactions for amount exceeding Rs. 50000/-will be required to mention

permanent (income tax) account number on applications.

b. The transactions involving cash withdrawals and/ or cash deposits for Rs.10 laces and

above in deposit, cash credit or overdraft accounts will be monitored closely by the

braches and record of details of such transactions will be kept in Separate register.

Customer Identification Procedure

Features to be verified and documents that may be obtained from customers

Features Documents

I. Accounts of individuals-

-Legal name and any other name used

-Correct permanent address

i. Passport ii. PAN/GIR number or Form 60 or 61(wherever applicable) iii. Voter’s Identity Card

iv. Driving License v. Identity card (subject to the bank’s satisfaction) vi. Letter from recognized

public authority or public servant verifying.

The identity and residence of the customer to the satisfaction of bank

A. Telephone bill

B. Bank account statement

C. Letter from any recognized public authority

D. Electricity bill

E. Ration card

F. Letter of employer (subject to satisfaction of the bank any one document which provides customer

information to the satisfaction of the bank will suffice)

II. Accounts of Partnership Firms

Legal name, Address, Name of all partners and their addresses, Telephone numbers of the firm

and partners, Registration certificate, if required, Certificate copy of Partnership Deed or

Partnership Letter (Ca-1(iii)).

CONCLUSION:

Page 59: somendra kumar meena

“Know Your Customer” (KYC) is a set of guidelines aimed at preventing banks and other service

companies from being used intentionally or unintentionally by criminal elements for committing

financial frauds, transferring or deposits of funds derived from criminal activity or for financing

terrorism.KYC norms are a very important part for any banking companies, financial institutions

and intermediaries. ING VYSYA GROUP strictly follows the KYC guidelines for account

opening, or any kind of investment to prevent frauds and cheating by their custumers.ING use

best of their efforts for the present money laundering.

REVIEW OF LITERATURE

4.1 PURPOSE:

The core purpose for the study is to understand the basic concepts of insurance sector and the

perception and investment pattern of respondents. Their perception towards ING Vysya in Jaipur

and its performance in the market. This is done to know consumers preference and needs and try

to bring about the product which may give satisfaction to the consumers. It is done to know the

overall merit and demerit of the product to give suggestions to improve the product. Following

are the purpose to do a project in insurance sector:

To identify various investment alternatives in insurance sector.

Page 60: somendra kumar meena

To compare the strength & weakness of different investment opportunity

To understand investors Preference in investment alternatives.

What characteristics of the investment product had influenced investors to make the investment in

particular investment?

To assess the various products of ING.

4.2 METHODOLOGY:

Methodology includes the various methods of data collection and interpretation which are as

follows:

o Data Sources

Mainly in a research process both, Primary and Secondary types of data sources are used. In this

research also we have two kinds of data sources given below:

1) Primary Data: Questionnaire and Interview

2) Secondary Data: Web pages, Company Journal’s & Brochures

o Data Collection Instruments:

The instruments used for data collection is a Questionnaire which is been filled by me through

communication and interactive session with the customers during my project period. Each

questionnaire represents essence information about a customer. So, a combination of Interview

and Questionnaire as a data collection is employed.

o NON – Probability Sampling

Non Probability sampling is that sampling procedure which does not afford any basis for

estimating the probability that each item in the population has of being included in the sample. It

is also known as deliberate sampling, purposive sampling and judgment sampling.

4.3 CONCLUSION:

The purpose of the study to get a feedback from the respondents about the various plans

available in the market , for this purpose the methods of data collection used are primary and

secondary. Analysis of various products of ING with available products of other companies on

the basis of benefits and risks of each product is possible with the help of data collected from the

company and through various tools of analysis.

Page 61: somendra kumar meena

ded in the sample. It is also known as deliberate sampling, purposive sampling and judgment

sampling.

Bar diagrams

of

Age at Entry:

Age at vesting:

Policy term:

Premium paying term:

Premium paying mode:

Maximum annual premium:

Vesting sum assured:

Guaranteed additions:

Guaranteed death benefit:

Min. 35- Max.60

Min. 45- Max.70

10 years only

3 years only

Annual only

No limit

200% of Annual Premium

8.75% Compounded per annum

Premium paid compounded at 3% per annum

for every completed policy year till death.

Other Benefits:

Guaranteed Vesting Benefits at the end of the policy term (10 years): Guaranteed vesting

benefit which equal to the vesting sum assured plus guaranteed additions at the end of the policy

term .For guaranteed vesting benefit an amount up to one third can be taken as commuted value

and minimum two third must be invested for purchase of annuity.

Page 62: somendra kumar meena

Tax free under Sec.80CCC and Sec.10 (10A) respectively of the income tax act 1961.

Guaranteed death benefits: Surrender Benefits-ING provides the surrender facility of the policy

after premium have been paid for at least 2 full years on surrender the policy will be eligible for a

special surrender value (SSV) which shall be determined by the Co. from time to time and will at

no point of time be lesser then 30% of annual premium paid in the first year.

Risk Factors:

1. ING Ace Pension is a non linked non participating life insurance product.

2. ING Vysya Life Insurance Co. Ltd. is only the name of the insurance company and ACE Pension

is only the name of the product and does not in any way indicate the quality of the product, its

future prospects and return.

3. In the event of any inconsistency/ambiguity between the terms contained herein and the policy

term and conditions, the policy term & condition shall prevail.

a) ING New Fulfilling Life: The New Fulfilling Life of ING Vysya Life Insurance plan is a double

benefit plan. It provides periodic cash return during the policy and maturity or death benefit after

the policy. It assures full security of the family of the insured person even after the death of the

insured. It gives the family regular cash returns during the life time

The features of New Fulfilling Life of ING Vysya Life Insurance plan are:

The minimum entry age for this policy is 14 years.

The maximum entry age for this policy is 54 years.

The maximum maturity age for this policy is fixed at 85 years.

The premium payment terms can be chosen from 16, 20 and 24 years.

The premium payment options are annual, half yearly, quarterly or monthly.

The minimum premium payment amount for annual option is Rs 8,000.

The minimum premium payment amount for half yearly option is Rs 4,000.

The minimum premium payment amount for quarterly option is Rs 2,000.

The minimum premium payment amount for monthly option is Rs 750.

The special feature of this plan is that it gives 100% of the sum assured as money back over the

payment term.

It also gives 100% on death or maturity.

Page 63: somendra kumar meena

The key benefits of New Fulfilling Life of ING Vysya Life Insurance plan are:

This policy has regular cash back benefit.

It also gives flexible premium payment benefit.

It also has guaranteed maturity benefit.

Other benefits:

Survival benefits: A certain percent of money is paid back on survival every quarter of the

premium paying term. The money can be reinvested elsewhere or used to meet large expenses

during one’s life time.

Amount receives periodically are as follows:

END OF

YEAR

16 YEAR

PPT

END OF

YEAR

20 YEAR

PPT

END OF

YEAR

25 YEAR

PPT

4 20% 5 20% 6 20%

8 20% 10 20% 12 20%

12 20% 15 20% 18 20%

16 40% 20 40% 24 40%

Maturity benefit: On survival to maturity i.e. after attaining 85 year of age you will receive100%

of the sum assured plus bonus.

Death benefits:

You pay premium for a limited period of your choice while you get a risk coverage up to the age

of 85 years.

In the event of your unfortunate death your family would receive 100% of the sum assured over

and above the survival benefits you would have receive till then plus bonus.

Risk

a. The benefits under this plan will not be payable if death of life assured occurs due to suicide

within one year from the date of commencement of risk own within one year from the date of

reinstatement of a lapsed polices.

b. If you are unable to pay your premium for some reason, then after 30 days of due date the policy

will lapse.

C). ING Market Shield: ING Market Shield not only provides life cover but also balances risk

and reward in a transparent manner and provides you an opportunity to enjoy growth while

Page 64: somendra kumar meena

retaining protection. It is a Unit linked life insurance plan that ensures you never miss an

opportunity to maximize your gains and at the same time limits your losses.

Eligibility Criteria

Age at Entry Min 8 years - Max 55 years

Age at Maturity Min 23 years - Max 70 years

Policy Term 15 to 20 years

Premium Paying Term Limited Pay (5, 10 years) or Regular Pay (equal to Policy Term)

Premium Payment Modes Annual

Minimum Premium for Limited Pay (5 years) the minimum yearly premium is

` 48,000

For Limited Pay (10 years) or Regular Pay: ` 36,000

Maximum Premium No Limit

Top-up Premium Minimum of ` 5,000, Maximum of ` 800,000

Basic Sum assured 10 to 20 times the Annual Premium

Additional Sum Assured Fixed at 1.25 times of the Top-up premium paid (if any

Benefits:

1. Optimizing upside potential due to Equity Participation

This plan provides you with the growth potential that comes from investing in shares that

comprise Nifty 50 (NSE CNX S&P Nifty Index). ING Life on every day basis will monitor the

equity market development and increase allocation to the equity market (up to a maximum of

60%) when times are good and will reduce (up to 0%) allocation to equities when markets are

volatile. This active daily asset allocation ensures that your gains are maximized and at the same

time protecting such gains from eroding.

2. Anytime guarantee - Protection that is available to you at all times and not just at maturity Not

only will this plan invest in equity and bring you the gains from the markets, it will also ensure

that gains that are made are locked in with a minimum 80% assurance. Every time the NAV of

the Guaranteed NAV Fund hits a new high, 80% of that NAV per unit is guaranteed (referred as

Guaranteed NAV or G-NAV). From there on, irrespective of the volatility in the market you are

assured of the G-NAV per unit at all times and not just at maturity. ING will reset this G-NAV on

a daily basis and once the G-NAV is set it can go up and never go down. The below graph

explains that in a rising market when the Daily NAV is higher the customer gets the maturity

benefits at the Daily NAV.

Page 65: somendra kumar meena

For example, if the Daily NAV on maturity is at 38 and the G-NAV is 30.4, you are still assured

of receiving the maturity benefits at the Daily NAV of 38. ING manages the Guaranteed NAV

fund through a dynamic asset allocation process which ensures that your guarantee is available to

you at all times and all benefits paid to you are at higher of the prevailing NAV (referred to as

Daily NAV) or the last Guaranteed NAV.

Comparative analysis of Reliance’s products:

a. Reliance Market Return Plan: You have always aspired for the best in life. And we help you

achieve just that. With Reliance Market Return plan you can have the twin advantage of insurance

protection as well as reaping the benefits of investment growth. It is a flexible plan which works

all through your life and meets the changing requirements like additional protection, liquidity

through cash, option to invest in different asset class, steady golden years and many more.

Key Features – Reliance Market Return Plan:

· Twin benefit of market linked return and insurance protection

· A Unit Linked Plan, different form traditional Life Insurance products, with maximum maturity

age of 80 years

· Option to create your own portfolio depending on your risk appetite

· Choose from 4 different investment funds

· Flexibility to switch between funds

· Option to pay regular as well as single premium & Top-ups

· Option to package with Accidental riders

· Flexibility to increase the Sum Assured

· Liquidity through partial withdrawals

Benefits:

Life Cover Benefit: You can choose the basic Sum Assured within the minimum and maximum

levels mentioned below

Minimum Sum Assured:

· Regular Premium: Annualized Premium for 5 years or for half the Policy term

· Single Premium: 125% of the single premium

Maximum Sum Assured:

No Limit (Rs 500,000 for age up to 12 years)

Page 66: somendra kumar meena

In case of unfortunate loss of life, your Beneficiary will get sum Assured or Unit Account Value

whichever is higher.

Maturity Benefit: On survival, at maturity the value of your Unit Account will be paid out.

Risk:

Reliance Life Insurance will not be liable to pay any Accidental Death Benefit Claim or Total

and Permanent Disablement Claim which results directly or indirectly from certain events.

Comparative analysis of HDFC’s products:

a. HDFC- Unit Linked Wealth Maximiser: Unit linked Wealth Maximiser is a single premium

unit linked plan. The plan offers an investment and protection benefit. This plan helps you meet

your family needs in the future. It also offers Loyalty Units which increases your fund value

yearly.

Eligibility Age at Entry:

Minimum 18 years Maximum 65 years

Minimum 18 years Maximum 55 years

Minimum Premium Payment: Rs1, 00,000/-

Term Limit: Is calculated 99 years less the entry age.

Benefits

1. It invests in market funds and which provides a long term growth and is a flexible to suit your

needs.

2. Loyalty Units- You get additional units every policy year end by 0.10% as long as the policy is

still active.

3. There are choices of 5 unit linked funds. Managers Fund, Mid-Cap Fund, Large-Cap Fund,

Bond Opportunities Fund and Money Plus Fund.

4. This plan has a cover till the age of 99 years.

5. There is a onetime premium payment when you start the policy.

b. HDFC Unit Linked Pension Maximizer II: During the post retirement days we earn a lot

and we spend a lot too. It should be in the mind of every working individual that spending is

something that takes place throughout one’s life but earning is only when one has the age and

strength to do so. Hence while earning and spending one should also know to save for the future

after retirement when earning stops and spending continues.

The best investment that one could ever think of is the unit linked pension maximiser II plan.

With this plan one can be independent throughout one’s lifetime with no hassles for money to

Page 67: somendra kumar meena

live an enjoyable life. This plan offers you the chance to maximize your investment returns and

gives an addition of 10% of the initial premium at the time of death or vesting.

The regular features of this plan include

A. A minimum term value of 10 years and a maximum of 40 years is allowed to the policy holder.

One can choose one’s own retirement date with this plan. There is a wide range of choice of

funds approximately seven choices to choose from.

B. The premium investment in a single payment initially is fifty thousand or more. Eligibility age is

18 years for this plan and the maturity age is 65. On retirement the minimum age is 50 and

maximum 75 years.

Benefits:

a. The benefits of the pension maximiser plan are unique

b. It is the best plan to choose to have a peaceful post retirement income even after retirement.

c. At the end of the policy one can receive not only the value of the matured funds but also bumper

additions that can be used as pension income as long as you live.

d. Bumper additions for policies whose term are equal or greater than 15 years will be paid on

vesting or at the time of death. These additions will be given according to the government

regulations

e. One can avail 1/3 of the total benefit at vesting as a tax free lump sum and get the rest converted

to annuity either with HDFC or any insurance company of one’s choice.

f. One can change the choice of investment funds by switching and moving the accumulated funds

from one plan to the other anytime.

g. One should be wise in making plans for the future. There should be no delay in selecting the

perfect golden years of retirement now while the going is good. Earn and save today and enjoy

tomorrow.

Comparative analysis of LIC’s products:

A. Market Plus 1: is a unit linked pension scheme (ULIP). Policy holder can choose the plan with

or without risk cover. This investment plan is divided in four types of investment Funds namely

Bond, Secured, Balanced and Growth Fund. Market plus 1 is primarily a Pension policy and the

plan has many attractive features and options that make it an ideal Retirement solution for your

future.

Page 68: somendra kumar meena

Eligibility Conditions and Restrictions:

For Basic Plan without Life Cover (Investment plan)

a) Minimum Sum Assured: Nil

b) Maximum Sum Assured: Nil

c) Minimum Premium : Rs.5, 000 p.a. for Regular premium, thereafter in multiples of Rs.

1,000

Rs. 1,000 p.m. for monthly (ECS), increasing thereafter in multiples of Rs. 250.

d) Maximum Premium : No Limit.

e) Minimum Entry Age : 18 years last birthday.

f) Maximum Entry Age : 74 years nearest birthday.

g) Minimum Deferment Team: 5 years.

h)Minimum Vesting Age : 40 years completed.

i)Maximum Vesting Age : 79 years completed.

Features:

1. Option to pay one time premium

2. Critical illness benefit minimum Rs 50,000 and the maximum Rs 10 lakh

3. Accident benefits from Rs 25,000 up to a maximum of Rs 50 lakh.

4. Switch from one type of fund to another up to four times a year.

5. Premium top up.

6. Policy can be taken with or without risk cover.

6. Net Asset Value (NAV) declared on a daily basis.

Benefits:

A)- On Vesting:

On vesting of the policy, the Fund Value will be utilized to provide a pension based on the then

prevailing Annuity rates. An option to commute upto one third of the payable benefit in a lump

sum is available.

B) On Death:

In event of the unfortunate death of the policy holder the Fund Value along with the Riders, if

any, will be payable in a lump sum or as a pension.

B. LIC’s Pension Plus: is a unit linked deferred pension plan, which provides you a minimum

guarantee on the gross premiums paid. The plan is without any life cover.

Page 69: somendra kumar meena

You have a choice of investing your premiums in one of the two types of investment funds

available. Premiums paid after deduction of allocation charge will purchase units of the Fund

type chosen. The Unit Fund is subject to various charges and value of units may increase or

decrease, depending on the Net Asset Value (NAV).

1. Payment of Premiums: You may pay premiums regularly at yearly, half-yearly or quarterly

or monthly (through ECS mode only) intervals over the term of the policy. Alternatively, a Single

premium can be paid.

A grace period of 30 days will be allowed for payment of yearly or half-yearly or quarterly

premiums and 15 days for monthly (through ECS) premiums.

2. Eligibility Conditions and Other Restrictions:

a) Minimum Entry Age - 18 years (last birthday)

b) Maximum Entry Age - 75 years (nearest birthday)

c) Minimum Vesting Age - 40 years (completed)

d) Maximum Vesting Age - 85 years (nearest birthday)

e) Minimum Deferment Term - 10 years

f) Sum Assured - NIL

g) Minimum Premium -

Regular premium (other than monthly (ECS) mode): Rs. [15,000] p.a.

Regular premium (for monthly (ECS) mode): Rs. [1,500] p.m.

Single premium: Rs. [30,000]

h) Maximum Premium -

Regular premium: Rs. [1, 00,000] p.a.

Single premium: No Limit

Annualized Premiums shall be payable in multiple of Rs. 1,000 for other than ECS monthly. For

monthly (ECS), the premium shall be in multiples of Rs. 250/-.

3. Other Features:

i) Guaranteed Maturity Proceeds: If all due premiums are paid till maturity, a guaranteed interest

shall accrue on the gross premium, including Top-up premiums if any, at the end of each

financial year. The guaranteed interest rate shall be 50 basis points above the average of the

reverse repo rate prevailing as on the last working day of June, September, December and March

of the preceding year. However, the guaranteed interest rate shall be subject to a maximum of 6%

and a minimum of 3%. This guaranteed interest rate is not applicable to a discontinued policy.

Page 70: somendra kumar meena

The minimum guaranteed rate of 4.5% p.a. is applicable to all premiums received up to 31st

March, 2011, including any Top-up premiums paid.

ii) Guarantee of interest rate on Discontinued Policy Fund: A guaranteed minimum interest rate

of 3.5% p.a. shall be credited to the Discontinued Policy Fund constituted by the fund value of all

discontinued policies.

iii) Top-up (Additional Premium): You can pay additional premium in multiples of Rs.1, 000

without any limit at anytime during the term of policy. Top-up shall not be allowed during the

last 5 years of the contract. In case of yearly, half-yearly, quarterly or monthly (ECS) mode of

premium payment such Top-up can be paid only if all premiums have been paid under the policy.

iv) Switching: You can switch between the two fund types during the policy term subject to

switching charges, if any.

v) Partial Withdrawal: No partial withdrawal of units will be allowed under this plan.

vi) Revival: If due premium is not paid within the days of grace, a notice shall be sent to you

within a period of fifteen days from the date of expiry of grace period to exercise the option for

revival within a period of thirty days of receipt of such notice. If you exercise the option to revive

the policy, then the arrears of premium without interest shall be required to be paid.

4. Risk:

Risks borne by the Policyholder:

LIC’s Pension Plus is a Unit Linked Life Insurance product which is different from the traditional

insurance products and is subject to the risk factors.

The premium paid in Unit Linked Life Insurance policies are subject to investment risks

associated with capital markets and the NAVs of the units may go up or down based on the

performance of fund and factors influencing the capital market and the insured is responsible for

his/her decisions.

The various funds offered under this contract are the names of the funds and do not in any way

indicate the quality of these plans, their future prospects and returns.

All benefits under the policy are also subject to the Tax Laws and other financial enactments as

they exist from time to time.

Comparative analysis of ICICI’s products:

a. ICICI Pru Lifetime Pension Maxima is a regular premium, unit-linked pension plan which

offers you the flexibility to invest in unit-linked funds that generate potentially better returns over

long term. This pension planning product also offers you a unique strategy that allows you to

Page 71: somendra kumar meena

protect gains made through your funds invested in the equity markets from any future equity

market volatility.

Features:

Min Premium

Rs.10, 000 p.a. for yearly mode

Rs.15, 000 p.a. for half yearly & monthly mode

Min / Max Age at Entry

18 / 70 years

Min / Max Age at Vesting

50 / 80 years

Min / Max Policy Term

10 / 60 years, allowed only in multiple of 5 years

Min / Max Sum Assured

0 / As per the Sustainability Matrix

Max Cover Ceasing Age

80 years

Modes of Premium Payment

Yearly / half yearly / Monthly

Benefits:

Trigger Portfolio Strategy: A unique portfolio strategy to protect gains made in equity markets

from any future equity market volatility while maintaining a pre-defined asset allocation

Additional allocation of units: More than 100% allocation to funds on premium payment from

the sixth policy year onwards of this unit-linked pension plan.

Loyalty Addition: At the end of every five policy years, starting from the 10th policy year, paid

irrespective of the premium payment status

Five pension planning options: Flexibility to choose a pension plan as per your needs

Tax benefits: Avail tax benefits on premiums paid and receive tax free commutation up to one-

third of the accumulated value on vesting (retirement) date, as per the prevailing Income Tax

laws

Comparative analysis of Bajaj Allianz’s products:

Page 72: somendra kumar meena

a. Wealth Insurance Plan: Bajaj Allianz Wealth Insurance Plan is a hassle-free way of investing

your money and at the same time taking care of your insurance needs. The plan gives you the

benefits of paying a single premium, so you don't have to worry about due dates, repetitive

paperwork and renewals or constantly make phone calls to your financial advisor. Apart from this,

the high allocation offered by the plan allows you to meet your financial goals.

Key Highlights

Wealth Insurance Plan offers the following key benefits:-

Loyalty addition up to 7% of single premium at the end of the fifth year. **Conditions Apply.

Option to receive the maturity benefits as settlement option.

Maximum flexibility to pay unlimited top-up premium and make partial withdrawals.

***Conditions Apply.

Option to decrease your sum assured.

Systematic switching option to manage your investments better.

Optional additional rider benefits to enhance your protection.

*The allocation rate is 98% for Single premium and Top up Premium.

* *If policy has not been terminated at the end of the 5th policy year the company will allocate

loyalty addition at the then prevailing unit price of an amount equivalent to 3.00% for Single

Premium of Rs. 50000 to 99999, 5.00% for single premium of Rs. 100,000 to 249,999 and 7.00%

for single premium of Rs. 250,000 and above. No loyalty addition is payable on any top-up

premium paid.

b. Pension Guarantee Plan: Pension Guarantee Plan ensures regular Income after Retirement.

for Life. With Bajaj Allianz Pension Guarantee Plan, you can ensure a regular income after

retirement. The plan offers you a range of immediate annuities to choose from. All you have to

do is pay a lump sum amount to Bajaj Allianz Life Insurance Company, and the annuity

payments will start after expiry of monthly/quarterly/half-yearly/yearly interval corresponding to

the payment mode selected by you. Under all options, annuity is payable for life, so you don't

have to worry about your income stopping at any age.

Features:

Minimum Age at Entry 40

Maximum Age at Entry 80

Minimum Purchase Price Rs.25, 000

Page 73: somendra kumar meena

Minimum Annuity Installment Rs.1, 000

:

Table 1: Showing age group among respondents

AGE RANGE NO. OF RESPONDENTS

< 25 24

25 – 30 22

31 – 40 38

>50 16

Graph1. Showing age group among respondents

INFERENCE: The graph shows the different age distribution of respondents. In this graph the

majority of the investors belonged to the group 31to 40 years. This group is most likely to think

of investment, especially from a perspective of savings for the future, including education of

children, self –sustenance after retirement etc.

TABLE 2: Showing respondents income level of distribution

INCOME RANGE NO OF RESPONDENTS % OF RESPONDENTS

< 1 LAKH 5 5%

Page 74: somendra kumar meena

1 LAKH-1.5 LAKH 10 10%

1.5 LAKH-2 LAKH 35 35%

2 LAKH-2.5 LAKH 40 40%

> 2.5 LAKH 10 10%

GRAPH 2: Showing respondents’ income level of distribution

INFERENCE: The graph shows the various income levels of respondents. In this graph the

majority of the respondents were in income bracket of Rs.2 lakh-2.5 lakh per annum. Next

highest group is 1.5-2 LAKH.

TABLE: 3 showing marital status of respondents

MARRIED SINGLE

58 42

GRAPH 3: Showing marital status of respondents

Page 75: somendra kumar meena

INFERANCE: As according to the graph the number of married persons is more than single this

group is most likely to think of investment especially from a perspective of saving and retirement

plans

TABLE 4: Showing educational background of respondents:

HIGH SECONDARY [10+2] GRADUATE POST GRADUATE

6 69 25

GRAPH 4: Showing educational background of respondents:

Page 76: somendra kumar meena

INFERANCE: As according to the graph the number of graduate is most amongst all

respondents.

TABLE 5: Showing Employment status of respondents:

SELF EMPLOYED PROFESSIONAL SALARIED

29 25 46

GRAPH 5: Showing Employment status of respondents:

Page 77: somendra kumar meena

INFERENCE: As shown in the table there is more salaried persons than self employed and

professional.

TABLE 6: Showing percentage of respondents having a life insurance policy

HAVING A LIFE POLICY NOT HAVING

57 43

GRAPH 6: Showing percentage of respondents having a life insurance policy

Page 78: somendra kumar meena

INFERANCE: As according to the graph there are 57% people having life insurance policy of

different companies and 43% are not having.

TABLE 7: Showing percentage of respondents interested in having different kinds of life plans.

PLANS INVESTORS PREFERANCE

SAVING PLAN 41%

UNIT LINK INSURANCE PLAN 44%

PENSION PLAN 15%

GRAPH 7: Showing percentage of respondents interested in different kinds of life plans.

Page 79: somendra kumar meena

INFERENCE: As according to the graph most people are interested in short term payment of

premium and high return ULIP and then the next higher group preferred saving plan for their

portfolio of investment.

TABLE 8: Showing percentage of respondents currently having life plans of different insurance

companies

INSURANCE COMPANIES PERCCENTAGE OF PREFERANCE OF

INVESTORS

LIC 61%

ING VYSYA LIFE 8%

HDFC STANDARD LIFE 5%

ICICI PRU LIF 9%

MAX NEW YORK 6%

SBI LIFE 11%

GRAPH 8: Showing percentage of respondents currently having life plans of different insurance

companies

Page 80: somendra kumar meena

INFERANCE: As according to the graph most of the investor prefer LIC life plans followed by

other companies so LIC is still the leader in Indian insurance sector and amongst the private

companies ICICI PRUDENTIAL LIFE is leading with 9% of respondents having its life plan.

TABLE 9: Showing percentage of investor’s preference for children plan for investment.

CUSTOMER PREFERRED CHILDREN

PLAN

CUSTOMER WHO DON’T PREFERRED

CHILDREN PLAN

41% 59%

GRAPH 9: Showing percentage of investor’s preference for children plan for investment.

Page 81: somendra kumar meena

INFERENCE: As according to the responses of customers mostly don’t preferred the children

plan because they are already having it or they are in different age group.

TABLE 10: Showing percentage of preference of respondents having different kinds of life plan.

LIFE PLANS INVESTORS PREFERENCE

TERM PLAN 10%

ENDOWMENT PLAN 21%

UNIT LINK INSURACE PLAN 29%

RETIREMENT PLAN 14%

CHILDREN PLAN 26%

GRAPH 10: Showing percentage of preference of respondents having different kinds of life plan.

INFERENCE: As according to the responses most investor preferred ULIP for investment

purpose because of high return and less premium paying term instead of that most investor

preferred plan which gave them guaranteed return with safety.

TABLE 11: Showing percentage of company preferred for investment by respondents

Page 82: somendra kumar meena

COMPANY NAME INVESTORS PREFERENCE IN

PERCENTAGE

ICICI 12%

ING 11%

LIC 61%

BAJAJ ALLIANZ 10%

MAX NEW YORK 6%

GRAPH 11: Showing percentage of company preferred for investment by respondents

INFERENCE: As according to the feedback of investors it can conclude that most people in India

prefer LIC for their investment purpose and in private sector there is a stiff competition between

various insurance companies.

TABLE 12: Showing percentage of time preference of respondents while selecting an investment.

TIME SCALE INVESTOR’S PREFERENCE

SHORT TERM 44%

MEDIUM TERM 41%

LONG TERM 15%

GRAPH 12: Showing percentage of time preference of respondents while selecting an

investment.

Page 83: somendra kumar meena

INFERENCE: As according to the feedback of respondents it is clear that most people are

interested in short term and medium term plan with good return while those who wants secured

returns can wait for long period of time.

TABLE 13: Showing factors preferred first by respondents while selecting an investment plan

FACTORS RESPONDENTS PREFERENCE

RETURN 49%

RISK 37%

TIME PERIOD 14%

GRAPH 13: Showing factors preferred first by respondents while selecting an investment plan

Page 84: somendra kumar meena

INFERENCE: As the feedback from the respondents it is clear that most people prefer return

while going for an investment followed by risk and time preference.

TABLE 14: Showing the percentage of awareness amongst the respondents about the available

insurance products in the market.

PERCENTAGE OF RESPONDENTS

AWARE ABOUT THE OTHER PRODUCT

PERCENTAGE OF RESPONDENTS NOT

AWARE ABOUT THE PRODUCT

38% 62%

GRAPH 14: Showing the percentage of awareness amongst the respondents about the available

insurance products in the market.

Page 85: somendra kumar meena

INFERENCE: The table of response shows that most people are not aware about the plans

currently available in the market; this section consists of the various people of young age and self

employed people.

TABLE 15: Percentage of respondent’s rating their current insurance plan on the basis of risk,

return and time duration.

LEVEL OF RISK LEVEL OF RETURN TIME

DURATION

LOW MODERATE HIGH LOW MODERATE HIGH SHORT

TERM

LONG

TERM

41% 15% 44% 14% 32% 54% 59% 41%

GRAPH 15: Percentage of respondent’s rating their current insurance plan on the basis of risk,

return and time duration.

Page 86: somendra kumar meena

INFERENCE:As the total number of respondents having a life policy is 57 so out of that the

different ratings given by them are shown above which shows that on the basis of risk most

people think that their current plan is more risky as they have invested in ULIP and other market

related plans. On the basis of return most respondents feels that their product is of high return

opportunity and at last on the basis of time duration most respondents are having short term high

risk and high return based insurance plan.

TABLE 16: Percentage of respondents likely to wait before going to change their current plan.

TIME SCALE RESPONDENT’S PREFERENCE

<12 MONTHS 55%

1-2 YEARS 32%

3-4 YEARS 11%

5-7 YEARS 2%

GRAPH 16: Percentage of respondents likely to wait before going to change their current plan.

Page 87: somendra kumar meena

INTERFENENCE: As according to the feedback of respondents it can be say that most people

wait for a year i.e. less than 12 months while going to change their current investment plan.

TABLE 17: Percentage of respondents visited to the company to know about the performance of

their products.

FREQUENCY OF VISIT RESPONDENT’S RESPONSE

ONCE IN A YEAR 29%

ONCE IN A QUARTER 24%

NEVER 47%

Page 88: somendra kumar meena

GRAPH 17: Percentage of respondents visited to the company to know about the performance of

their products.

INFERENCE: As the feedback from respondents it can be say that most of them never visit to

know the performance of their product because in ULIP products they can get information

through websites and internet and others are visit on a periodical basis.

TABLE 18: Showing the level of satisfaction of current customers of ING as ranking given by

them.

LEVEL OF SATISFACTION RANKING GIVEN BY CUSOMERS

GOOD 87%

AVERAGE 11%

NOT SATISFIED 2%

GRAPH 18: Showing the level of satisfaction of current customers of ING as ranking given by

them.

Page 89: somendra kumar meena

INFERENCE: As according to the graph it is clear that most of the customer of ING are satisfied

with the services provided by the company both in Insurance as well as banking sector.

SUMMARY OF FINDINGS:

7.1 BASED ON ANALYSIS:

The summary of survey conducted for ING Vysya life insurance, Can be listed down in

conjunction with the data analysis presented. The functioning and responses from the respondents

were authentic leading to a better view of the market scenario. The findings are listed below:

o The contribution of insurance industry to the GDP of nation is 7%

o ING is the world’s largest financial services company.

o Ranked 8th in Fortune Global 500.

o With 150+ years of financial expertise and 8.5 crore customers in 40+ countries.

o Core services :banking ,investments ,life insurance & retirement services

o Revenue amount to 226,577.00 Million USD.

o In India, ING has a experience of over 10 years.

Page 90: somendra kumar meena

o The company is targeting on emerging financial market in India with great potential.

o Majority of the respondents are from salaried class.

o Literacy level of the respondents is high, majority of them are educated.

o Mainly, male respondents having Life Insurance then female.

o Mostly, married respondents having Life Insurance.

o Average annual income of respondents is between 2-2.5 laces.

o Majority of respondents are having a Life Insurance.

o Most of respondents are holding an account with LIC and ICICI Prudential Life.

o Most of respondents prefer short term and medium term time scale for investment.

o Most of the respondents prefer short term high return Unit link insurance plan for investment.

o ING three products: ING Market Shield, ING Ace Pension Plan and ING Fulfilling Life are the

top 3 rated products in the first quarter of the current financial year and ranked A+ by various

business magazines.

o ING has current shareholding with EXIDE Industries, ENAM and Gujarat Ambuja Cement

o Most of the customer is highly satisfied with the services provided by ING.

o Most of the respondents are not aware about the available insurance products in the market

7.2 SWOT ANALYSIS:

STRENGTH

1) A strong brand name with a high degree of financial support which is the back bone of the

company.

2) Brand leaders in bringing latest financial services for the common man.

3) An innovator, pre problem seeker and risk taking capabilities.

4) Systematic, planned and quick actions taken up lead to quick reactions by the company

ultimately providing a competitive edge to ING.

5) ING is the world’s largest financial services company.

Page 91: somendra kumar meena

6) Ranked 8th in Fortune Global 500.

7) With 150+ years of financial expertise and 8.5 crore customers in 40+ countries.

WEAKNESS:

1) The plans of company are beneficial but the premium rates are very high.

2) Company is new in Indian market.

3) The data collected cannot be considered as 100% accurate but it is only an estimated

figures gathered by the survey.

4) The analysis so done cannot be regarded as the final as change is the only constant thing

which happens.

OPPORTUNITIES:

1) A huge untapped market.

2) Emerging middle class, a good potential market.

3) Increasing employment rate and income.

4) Increasing financial investments in market.

THREATS:

1) Neck to Neck competition with ICICI and HDFC with respect to services and policies.

2) Threats from growing competitors like Bajaj Allianz and Aviva in Insurance sector.

3) New entrant in the market, Sahara India Life, Om KOTHAK MAHINDRA etc, is an area of

concern.

CONCLUSION:

ING is the experts in financial sector having a 150+ years of experience in insurance sector

worldwide. In India, currently present in234 cities across 265 branch offices withover366 sales

teams.

Page 92: somendra kumar meena

The practicality of being associated with ING was a pleasant experience for me revealed by this

survey. ING Vysya Life Insurance is a well known brand in Bangalore. The company has a keen

interest in the development and enhancement of its products in India. The company focuses in

providing quality products to all the areas of our country. Company don’t prefer marketing

strategies and advertisement expenditure at core, it invest the advertisement funds for the benefits

of the customer and provides them the highest return possible. Currently ING’s three products

providing maximum guaranteed bonus rate of 7.5% and are the top rankers in all insurance

products available in the market.

Company is facing stiff competition in the market with other private companies. In India, It has

completed its 10 successful years of operation which shows its reliability.

ING product quality is good but the premium rates they are taking are bit high because they are in

establishing phase in India so they are charging more money as their establishment expenses but

now ING has completed its 10 years in India and is a well known brand so its future is quite

promising. Company is launching new products with very high benefits to the customers. The

growing demand in the market for ING Vysya Life Insurance products indicates the prospect of

new customers for the company.

Finally I conclude that ING Vysya Life Insurance has built up a brand name, which needs to be

maintained through continuous feedback, improvement and proactive actions. The company has

already sensed the market potential and now it should focus on coming with schemes and

products plans to give the market what they want from ING Vysya Life Insurance.

Revitalization of Rural Markets through Insurance

Given the uncertainty that abounds our environment, awareness is the most important thing as people in poor regions are not familiar with the concept of insurance. Insurance companies must work around this problem as a corporate social responsibility in countries like India where there is no state social security system.

The traditional agency channel for doing so may not be sustainable in the longer term in rural segment unless significant changes are made towards poor training, lower productivity, ineffective sales management, part-time sales of low quality, and high agent turnover. But, the question is how to address this in the short term, in a cost effective manner. Are there any alternatives?

Page 93: somendra kumar meena

The private players, especially the foreign banks, have strategically spread their operations to rural areas via self help groups and non-government organizations, micro-finance institutions and cooperatives as agents. For example, Aviva sells insurance through SEWA in Ahmedabad and Basix India, Hyderabad."

Distribution and servicing are two key areas in developing rural business. ICICI Prudential has a robust rural distribution model, involving tied agents, brokers as well as referral arrangements with NGOs, micro-finance institutions and corporates.

"We work closely with our partners like Uttaranchal Co-operative Marketing Federation, Gramasiri (an MFI), Cargill, Anarde Foundation, ICICI Bank and ITC's e-Choupal, to educate people about how life insurance can be used as a protection and savings instrument," says Shikha Sharma, CEO & MD, ICICI Prudential Life Insurance. Through these relationships ICICI Prudential is present in more than 15 States, including Andhra Pradesh, Madhya Pradesh, Tamil Nadu, Rajasthan and Uttar Pradesh.

"We have long been convinced of the need for and long-term potential of life insurance in rural India. Certainly, covering the lives of those in rural areas presents several unique challenges. We have remained true to our customer first philosophy by developing specific products and introducing simplified underwriting and claims guidelines, to help the rural customer secure his or her financial future," says Ms. Sharma. Unfortunately efforts do not seem to match concerns.

BANCASSURANCE OPERATIONAL MODELS

Most of the bancassurance relationships in India are started with a 'referral' type arrangement, where bank staff provide leads to a specialist insurance company sales force, in return for which, the bank receives a 'fee'. Although this model is still adopted by some insurers, the banking and insurance regulators are apparently unhappy with the scope for what they consider 'misuse of personal customer data' collected by referral agents of insurance companies posted at bank branches. The regulators also fear that the level of post-sale service provided to the clients may be compromised as a result of the bank not engaging itself with the sale process. As a result, they are now discouraging insurers and banks from entering into new referral arrangements.

The main alternative model is more bank-centric in its sales approach. Banks have to obtain a corporate agency license to permit bank staff to distribute insurance. In this model, bank staff carries out the selling activities, and the bank receives a commission for the sales as per the corporate agency agreement.

The distribution agreements on which these models are reliant typically have durations ranging from one to 10 years. Most agreements are loosely worded, without the bank partners paying much attention to the customer servicing responsibilities in the post-sale phase. This leaves the field wide open for corruption nepotism and exploitation by the haves against the have nots. Whereas ethics is required governance is imperative.

Some banks have taken a more committed approach, taking an equity stake in a new joint venture life insurance company. Examples include ING Vysya Life Insurance, where Vysya Bank holds a 49 per cent shareholding, or MetLife, where Jammu and Kashmir Bank holds 25 per cent. In theory, these relationships should prove to be more effective; however, as of now, insurers with 'distribution only' agreements with the banks, such as Birla Sun Life and Aviva, seem to be writing more business through their bancassurance partnerships. These companies attribute their success to the closer involvement with the partner banks on improving bank based selling capabilities.

Page 94: somendra kumar meena

Alternative methods such as tapping the corporate clients of the bank, conducting worksite marketing within corporate clients, as well as direct and telemarketing, are currently not being exploited to any great extent, but clearly represent significant potential for both banks and insurers.

Some bancassurance relationships have been relatively successful in developing loan-related or packaged products. However, the emergence of other more tailored products for bank customers is still at a nascent stage.

CORPORATE AGENCY (OR OTHER AFFINITY GROUPS) MODELS

There are literally thousands of other potential affinity groups in India. To date, the insurers have been fairly selective in choosing to tie up with affinity groups primarily from a financial services background. Such organizations are probably closer to banks, in terms of the potential business volumes and also having some form of distribution capability.

These groups also include so called 'para-banking' organizations or 'non-banking finance companies' (NBFCs). NBFCs are companies with restricted banking licenses who are able to accept and hold deposits from the public. These groups also include multi-level marketing/distribution organizations. Generally insurers have preferred to set up corporate agency agreements with these companies, rather than establishing referral arrangements.

There are some 500 or so registered 'significant' NBFCs, with thousands of other potential affinity groups.

PRODUCT ENHANCEMENT FOR RURAL INCIDENT

Product development is proving to be key as the many distribution partners are beginning to request a more tailored suite of products, as opposed to the generic offerings that the insurers launched when they started their business.

As bank and affinity partners become more aware of the opportunities and as new insurance companies look to enter the sector, the first wave of new entrants will need to work hard to maintain the relationships that they have developed to date. The success and sustainability of the existing relationships are likely to depend on the ability of insurance companies to respond to demands from distributors, in what is likely to be a very competitive space.

The challenges to successfully build on what has been achieved to date will also emerge once the so called 'low hanging fruit' has disappeared. A commitment from both the insurer and distributor to devote the time to develop the channels and to expand the range of products will be one of the key success factors for the development of a longer-term relationship.

Notwithstanding these challenges, there is no doubt that alternative distribution in India will play a major role as the insurance sector develops. Although only in its infancy, there are an even greater number of opportunities that remain untapped. India provides one of the most unique opportunities to work with a wide variety of distributors and to develop innovative distribution models. It will be interesting to see how the agency channel evolves and adapts in response to this increasing 'competition.'

CLIENT SERVICING ALARM

With increased competition among insurers, service has become a key issue. Moreover, customers are getting increasingly sophisticated and tech-savvy. People today don't want to

Page 95: somendra kumar meena

accept the current value propositions, they want personalized interactions and they look for more and more features and add ones and better service.

The insurance companies today must meet the need of the hour for more and more personalized approach for handling the customer. Today managing the customer intelligently is very critical for the insurer especially in the very competitive rural environment. Companies need to apply different set of rules and treatment strategies to different rural segments. However, to personalize interactions, insurers are required to capture customer information in an integrated system dedicated for rural business.

With the explosion of Website and greater access to direct product or policy information, there is a need to developing better techniques to give rural customers a truly personalized experience. Personalization helps organizations to reach their customers with more impact and to generate new revenue through cross selling and up selling activities.

Also, physical presence in the locality will be required to support client servicing. Having felt the cost pressure owing to modest sales-turnover may force companies to market insurance as that of FMCG companies. They may start their business opening more and more satellite offices. It is strongly recommended for adoption in penetrating the rural space for product marketing. But, the sales of insurance are the subject matter of financial services marketing, where personalization issues are more significant. The essence of the better service in respect of personalization is never found at the satellites, which is generally done through remotely and much centrally located hub branch.

Ironically, the deadlines are more focused when closing the sale unlike for providing service in time for settling the claims and other operational issues. Generally, it is believed that issues in the business result in the recruitment of the sales staff for loading sales with additional pressure of operations issues. For becoming successful in delicate rural segment, such issues and overloading of operational burden on sales staff may trigger a back fire resulting in loss of possible revenue for the company.

Drawing-board approach to formulate the sales figure for rural markets is unrealistic without having understood the rural sentiments. In India the insurance business can be said to be "a marathon, not a sprint". This is because of the nature of the business being long term. As insurance companies go more and more rural in search of business, there will be opportunities in the rural sector.

SECRETS TO SUCCESS  

Those who understand rural India better will be in demand. When the rural consumer will start exhibiting an increasing propensity for insurance products, there is a once in a lifetime opportunity to transform dreams into visible reality for companies having understanding of rural outlook. This will essentially requires a leading TEAM (Together Everyone Achieves More) of professionals with the said rural outlook with mission to learn the Rural Business professionally with focus on Retail networking.

Following the RUN (Retail – Use – Network) system, marketing insurance in rural space sounds more realistic, when this being sold as Smart-Career. Smart-Career is involved in marketing of Insurance policies and allied services, having wide experience of Referral Marketing with sufficient present customer network. This may be marketed for successful career in rural insurance. Such a move of Smart-Career has to be marked with '6-P' template of Rural Insurance Marketing:

Page 96: somendra kumar meena

Patience

Being patience is very important when a new assignment is taken up without knowing what may happen due to non availability historical data. Often the contracts with banks having big presence in rural markets take unusually high time to be signed. Further, after getting into the contract, there might be delivery pressures from the management of the insurance company as well the said bank subject to the best possible service for the referral customers. Only patience with own mind action is the solution…

Perseverance

It is all about determination and high energy. Focus must be clear when rural sentiments are to be aligned to the organizational mission of becoming successful in rural insurance marketing. Also, an individual taking on the responsibility of making insurance big in rural market must review all the successes enjoyed in every area of life to become determined. This determination will pave the path of delight of making a strong foundation in rural markets.

Passion

Its' is difficult always a Push Start a car … its' better to have one that starts on its own. The battery within puts required energy to make the engine roar. Am I talking of a car? ... It is an effort just to relate to one professional with sufficient motivation. So, passionate working may bring right attitude to become successful in rural insurance marketing.

Product

The knowledge about the product helps in providing best solutions for the customer who requires personalized and not generalized clarifications. The success mantra is to become an avid learner in the field of rural insurance marketing, who can be consulted even after the close of a sale. It is imperative to highlight that there is no patenting done in insurance products and, therefore, selling a product primary becomes full personalized effort. For becoming successful, it is imperative to be the master of the product.

People

It is about making habit of meeting people, and making sound network for being successful in rural insurance marketing. Making habit is significant! When a man makes the habit of smoking, even after knowing it being dangerous to the health, he smokes. So, is it a wrong idea to make meeting and networking people your habit, when you know that it is only and only aspect to make you booming?

Programme

Every body in business has some issue to remain in business where only tool to drive the business is programmes. You need to be good driver to handle a car; similarly a good driver of business must have handful understanding of driving programmes.

Page 97: somendra kumar meena

WRAPPING UP

As per press reports, Pantaloon Retail India, the retail arm of the Future Group, has entered into an agreement with the Italian insurer Generali, to set up life and non-life insurance joint ventures. The insurance companies will be named Future Generali Life Insurance and Future Generali General Insurance. Pantaloon Retail will hold a 56% stake, Pantaloon Industries will hold a 18% stake with Generali holding the remaining 26% stake in both joint ventures. The joint ventures will leverage on Pantaloon's retail outlets for distribution of insurance products.

It is reported that IDBI Bank has tied up with Fortis Insurance and Federal Bank for a life insurance joint venture. IDBI Bank and Fortis will hold stakes of 49% and 26% respectively with Federal Bank holding the remaining stake of 25%.

PNB Principal Life expects to commence operations in September 2006, and plans to focus on the group insurance segment. It is reported that UK Paints (a subsidiary of Berger Paints) will hold a 32% stake in the joint venture, Punjab National Bank will hold a 30% stake, Principal will hold a 26% stake and Vijaya Bank will hold a 12% stake.

It is reported that Sompo has tied up with Allahabad Bank, Indian Overseas Bank, Karnataka Bank and Dabur to set up a non-life insurance joint venture later this year. As per reports, Allahabad Bank will hold a 30% stake in the joint venture, Sompo will hold a 26% stake, Indian Overseas Bank will hold a 19% stake, Karnataka Bank will hold a 15% stake and Dabur will hold a 10% stake.

Canara Bank is planning a foray into life insurance. It is reportedly in talks with a few foreign insurers for a possible joint venture. Canara Bank currently has a corporate agency distribution tie-up with Aviva.

Bank of India is reportedly looking to set up a life insurance company with a foreign partner. It currently has a corporate agency distribution tie-up with ICICI Prudential.

Oriental Bank of Commerce, currently a corporate agent for the LIC, is also reportedly looking to enter the life insurance sector.

With so much happening in the insurance foray, there is positive likelihood of rural

renaissance as far as insurance is concerned. It may the rural India to drive the future growth

for insurance where a lot more is required to be researched. Policy formulations in future

may contribute more towards an understanding of how we can support rural masses struggle

against vulnerability, risk and poverty in respect of providing better avenues for

investments. It is an unexplored prospect and both scholars and policy makers should look

into this phenomenon before it is too late!