8/9/2019 Report Reliance Insurance
1/73
Chapter -1
Introduction of Life Insurance
1
8/9/2019 Report Reliance Insurance
2/73
LIFE INSURANCE
Life insurance is a form of insurance that pays monetary proceeds upon the death of the
insured covered in the policy. Essentially, a life insurance policy is a contract between the
named insured and the insurance company where in the insurance company agrees to pay
an agreed upon some of money to the insureds named beneficiary so long as the
insureds premiums are current.
With a large population and the untapped market area of this population insurance
happens to be a very opportunity in India. Today it stands as a business growing at the
rate of 15-20% annually. Together with banking services, it adds about 7% to country
GDP.
In spite of all this growth statistics of the penetration of the insurance in the country is
very poor. Nearly 80% of Indian populations are without life insurance cover and the
health insurance. This is an indicator that growth potential for the insurance sector is
immense in India.
It was due to this immense growth that the regulations were introduced in the insurance
sector and in continuation Malhotra Committee was constituted by the government in
1993 to examine the various aspects of the industry. The key element of the reform
process was participation of overseas insurance companies with 26% capital.
Creating a more competitive financial system suitable for the requirements of the
economy was the main idea behind this reform.
2
8/9/2019 Report Reliance Insurance
3/73
Since then the insurance industry has gone through many changes. The liberalization of
the industry the insurance industry has never looked back and today stand as one of the
most competitive and exploring industry in India. The entry of the private players and the
increased use of the new distribution are in the limelight today. The use of new
distribution techniques and the IT tools has increased the scope of the industry in the
longer run.
Insurance is the business of providing protection against financial aspects of risk, such as
those property, life, health and legal liability.
It is one method of a greater concept known as risk management- which is the need to
manage uncertainty on account of exposure to loss, injury, disadvantage or destruction.
Insurance is the method of spreading and transfer of risks. The fortunate many who are
exposed to some or similar risk shares loss of the unfortunate. Insurance does not protect
the assets but only compensates the economy or financial loss.
In insurance the insured makes payment called Premiums to an insurer, and in return is
able to claim a payment from the insurer if the insured suffers a defined type of loss.
This relationship is usually drawn upon in a formal legal contract. Insurance companies
also earn investment profits, because the have the use of the premium money from the
time they receive it until the time the need it to pay claims. This money is called the float.
When the investment of float are successful the may earn large profits, even if the
insurance company pays out of claims every penny received as premiums.
3
8/9/2019 Report Reliance Insurance
4/73
In fact, most insurance companies pay out more money than they receive in premiums.
The excess amount that they pay to policyholders is the cost of float. An insurance
company will profit if the invest the money at a greater return than their cost of float. An
insurance contract or policy will set out in detail the exact circumstances under which a
benefit payment will be made and the amount of premiums.
Classification of Insurance
The insurance industry in India can broadly classify in two parts. The are.
1. Life Insurance
2. Non Life (general) Insurance
Life Insurance
Life insurance can be defined as life insurance provides a some of money if the
person who is insured dies while the policy is in effect.
In 1818 British introduced to India, with the establishment of the oriental life
insurance company in Calcutta. The first Indian owned life insurance company is the
Bombay mutual life assurance society was setup in 1870.
The life insurance act,1912 was the first statuary measure to regulate the life
insurance business in India. In 1983, the earlier legislation was consolidated and
4
8/9/2019 Report Reliance Insurance
5/73
amended by the insurance act, 1938, with comprehensive provisions for detailed
effective control over insurance.
The union government had opened the insurance sector for private participation in
1999, also allowing the private companies to have foreign equity up to 26% .
Following the opening up of the insurance sector, 12 private sector companies have
entered the life insurance business.
Benefits of Life Insurance
Life insurance encourages saving and forces thrift.
It is superior to traditional saving vehicles.
It help to achieve the purpose of life assured.
It can be enchased and facilitates quick borrowing.
It provides valuable tax relief.
Thus insurance is found to be very useful in the lives of the person both in short term
and long term.
5
8/9/2019 Report Reliance Insurance
6/73
Fundamental Principles Of Life Insurance
1. Principle of almost good faith:
A positive duty to voluntary disclose, accurately and fully, all facts, materials to the
risk being proposed whether requested or not.
2. Principle of insurable interest:
Relationship with the subject matter (a person) which is recognized in law and gives
legal rights to insure the person.
Non-Life (General) Insurance
Triton insurance co. ltd was the first general insurance company to be established in
India in 1850, whose shares were mainly by the British. The first general insurance
company to be set up by an Indian mercantile insurance company ltd., which was
stabilized in 1970.
The general insurance business was nationalized after the promulgation of general
insurance corporation (GIC) of India undertook the post nationalization general
insurance business.
6
8/9/2019 Report Reliance Insurance
7/73
THE INSURANCE INDUSTRY IN INDIA
AN OVERVIEW
With the largest number of life insurance policies in force in the world, Insurance
happens to be a mega opportunity in India. Its a business growing at the rate of 15-20 per
cent annually and presently is of the order of Rs 1560.41 billion (for the financial year
2006 2007). Together with banking services, it adds about 7% to the countrys Gross
Domestic Product (GDP). The gross premium collection is nearly 2% of GDP and funds
available with LIC for investments are 8% of the GDP.
Even so nearly 65% of the Indian population is without life insurance cover while health
insurance and non-life insurance continues to be below international standards. A large
part of our population is also subject to weak social security and pension systems with
hardly any old age income security
A well-developed and evolved insurance sector is needed for economic development as it
provides long term funds for infrastructure development and strengthens the risk taking
ability of individuals. It is estimated that over the next ten years India would require
investments of the order of one trillion US dollars.
7
8/9/2019 Report Reliance Insurance
8/73
HISTORICAL PERSPECTIVE
The history of life insurance in India dates back to 1818 when it was conceived as a
means to provide for English Widows. Interestingly in those days a higher premium was
charged for Indian lives than the non - Indian lives, as Indian lives were considered more
risky to cover. The Bombay Mutual Life Insurance Society started its business in 1870. It
was the first company to charge the same premium for both Indian and non-Indian lives.
The Oriental Assurance Company was established in 1880. The General insurance
business in India, on the other hand, can trace its roots to Triton Insurance CompanyLimited, the first general insurance company established in the year 1850 in Calcutta by
the British. Till the end of the nineteenth century insurance business was almost entirely
in the hands of overseas companies.
Insurance regulation formally began in India with the passing of the Life Insurance
Companies Act of 1912 and the Provident Fund Act of 1912. Several frauds during the1920's and 1930's sullied insurance business in India. By 1938 there were 176 insurance
companies.
The first comprehensive legislation was introduced with the Insurance Act of 1938 that
provided strict State Control over the insurance business. The insurance business grew at
a faster pace after independence. Indian companies strengthened their hold on this
business but despite the growth that was witnessed, insurance remained an urban
phenomenon.
8
8/9/2019 Report Reliance Insurance
9/73
The Government of India in 1956, brought together over 240 private life insurers and
provident societies under one nationalized monopoly corporation and Life Insurance
Corporation (LIC) was born. Nationalization was justified on the grounds that it would
create the much needed funds for rapid industrialization. This was in conformity with the
Government's chosen path of State led planning and development.
The non-life insurance business continued to thrive with the private sector till 1972. Their
operations were restricted to organized trade and industry in large cities. The general
insurance industry was nationalized in 1972. With this, nearly 107 insurers were
amalgamated and grouped into four companies- National Insurance Company, New India
Assurance Company, Oriental Insurance Company and United India Insurance Company.
These were subsidiaries of the General Insurance Company (GIC).
9
8/9/2019 Report Reliance Insurance
10/73
KEY MILESTONES
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 by the Insurance Act with the
objective of protecting the interests of the insuring public.
1956: 245 Indian and foreign insurers along with provident societies were taken over by
the central government and nationalized. LIC was formed by an Act of Parliament- LIC
Act 1956- with a capital contribution of Rs. 5 crore from the Government of India.
10
8/9/2019 Report Reliance Insurance
11/73
INDUSTRY REFORMS
Reforms in the Insurance sector were initiated with the passage of the IRDA Bill in
Parliament in December 1999. The IRDA since its incorporation as a statutory body in
April 2000 has fastidiously stuck to its schedule of framing regulations and registering
the private sector insurance companies. Since being set up as an independent statutory
body the IRDA has put in a framework of globally compatible regulations.
The other decision taken simultaneously to provide the supporting systems to the
insurance sector and in particular the life insurance companies was the launch of the
IRDA online service for issue and renewal of licenses to agents. The approval of
institutions for imparting training to agents has also ensured that the insurance companies
would have a trained workforce of insurance agents in place to sell their products.
PRESENT SCENARIO - LIFE INSURANCE INDUSTRY IN INDIA
The life insurance industry in India grew by an impressive 47.38%, with premium
income at Rs. 1560.41 billion during the fiscal year 2006-2007. Though the total volume
of LIC's business increased in the last fiscal year (2006-2007) compared to the previous
one, its market share came down from 85.75% to 81.91%.
The 17 private insurers increased their market share from about 15% to about 19% in a
year's time. The figures for the first two months of the fiscal year 2007-08 also speak of
the growing share of the private insurers. The share of LIC for this period has further
come down to 75 percent, while the private players have grabbed over 24 percent.
11
8/9/2019 Report Reliance Insurance
12/73
With the opening up of the insurance industry in India many foreign players have entered
the market. The restriction on these companies is that they are not allowed to have more
than a 26% stake in a companys ownership.
Since the opening up of the insurance sector in 1999, foreign investments of Rs. 8.7
billion have poured into the Indian market and 19 private life insurance companies have
been granted licenses.
Innovative products, smart marketing, and aggressive distribution have enabled fledgling
private insurance companies to sign up Indian customers faster than anyone expected.Indians, who had always seen life insurance as a tax saving device, are now suddenly
turning to the private sector and snapping up the new innovative products on offer. Some
of these products include investment plans with insurance and good returns (unit linked
plans), multi purpose insurance plans, pension plans, child plans and money back plans.
12
8/9/2019 Report Reliance Insurance
13/73
Chapter-2
Company Profile
13
8/9/2019 Report Reliance Insurance
14/73
COMPANY PROFILE
FOUNDER
Few men in history have made as dramatic a contribution to their countrys economic
fortunes as did the founder of Reliance, Sh. Dhirubhai H Ambani. Fewer still have left
behind a legacy that is more enduring and timeless.
As with all great pioneers, there is more than one unique way of describing the
true genius of Dhirubhai: The corporate visionary, the unmatched strategist, the proud
patriot, the leader of men, the architect of Indias capital markets, the champion of
shareholder interest.
But the role Dhirubhai cherished most was perhaps that of Indias greatest wealth
creator. In one lifetime, he built, starting from the proverbial scratch, Indias largest
private sector enterprise.
When Dhirubhai embarked on his first business venture, he had a seed capital of
barely US$ 300 (around Rs 14,000). Over the next three and a half decades, he
converted this fledgling enterprise into a Rs 60,000 crore colossusan achievement
which earned Reliance a place on the global Fortune 500 list, the first ever Indian
private company to do so.
Dhirubhai is widely regarded as the father of Indias capital markets. In 1977,
when Reliance Textile Industries Limited first went public, the Indian stock market
was a place patronised by a small club of elite investors which dabbled in a handful of
stocks.
14
8/9/2019 Report Reliance Insurance
15/73
Undaunted, Dhirubhai managed to convince a large number of first-time retail
investors to participate in the unfolding Reliance story and put their hard-earned
money in the Reliance Textile IPO, promising them, in exchange for their trust,
substantial return on their investments. It was to be the start of one of great stories of
mutual respect and reciprocal gain in the Indian markets.
Under Dhirubhais extraordinary vision and leadership, Reliance scripted one of
the greatest growth stories in corporate history anywhere in the world, and went on to
become Indias largest private sector enterprise.
Through out this amazing journey, Dhirubhai always kept the interests of the
ordinary shareholder uppermost in mind, in the process making millionaires out of
many of the initial investors in the Reliance stock, and creating one of the worlds
largest shareholder families.
15
8/9/2019 Report Reliance Insurance
16/73
ABOUT RELIANCE
Reliance Life Insurance Company Limited is a part of Reliance Capital Ltd. of the
Reliance - Anil Dhirubhai Ambani Group. Reliance Capital is one of Indias leading
private sector financial services companies, and ranks among the top 3 private sector
financial services and banking companies, in terms of net worth. Reliance Capital has
interests in asset management and mutual funds, stock broking, life and general
insurance, proprietary investments, private equity and other activities in financial
services.
Reliance Capital Limited (RCL) is a Non-Banking Financial Company (NBFC)
registered with the Reserve Bank of India under section 45-IA of the Reserve Bank of
India Act, 1934.
Reliance Capital sees immense potential in the rapidly growing financial services
sector in India and aims to become a dominant player in this industry and offer fully
integrated financial services.
Reliance Life Insurance is another step forward for Reliance Capital Limited to
offer need based Life Insurance solutions to individuals and Corporates.
16
8/9/2019 Report Reliance Insurance
17/73
COMPANY OBJECTIVE
At Reliance Life Insurance, we strongly believe that as life is different at every stage, life
insurance must offer flexibility and choice to go with that stage. We are fully prepared
and committed to guide you on insurance products and services through our well-trained
advisors, backed by competent marketing and customer services, in the best possible
way.
It is our aim to become one of the top private life insurance companies in India
and to become a cornerstone of RLI integrated financial services business in
India.
COMPANY MISSION
To set the standard in helping our customers manage their financial future.
17
8/9/2019 Report Reliance Insurance
18/73
INSURANCE PLANS
1. Product (Individual Plans) Saving(Endowment)
2. Reliance Endowment Plan (Formerly Divya Shree)
3. Reliance Special Endowment Plan (Formerly Subha Shree)
4. Reliance Cash Flow Plan (Formerly Dhana Shree)
5. Reliance Child Plan (Formerly Yuva Shree)
6. Reliance Whole Life Plan (Formerly Nitha Shree)
Pensions
7. Reliance Golden Year Plan (Formerly Bhagya Shree)
Investments
7. Reliance Market Return Plan (Formerly Kanaka Shree)
8. Reliance Term Plan (Formerly Raksha Shree)
9. Risk / Protection
Reliance Group Term Assurance Policy(Formerly Group Term Assurance
Policy)
Reliance EDLI Scheme (Formerly EDLI Scheme)
18
8/9/2019 Report Reliance Insurance
19/73
8/9/2019 Report Reliance Insurance
20/73
Tax Benefits
Income tax section Gross annual
salary
How much tax can
you save?
Hdfc standard life
plans
Sec. 80C Across All income
Slabs
Upto Rs. 33,990
saved on
investment of
Rs. 1,00,000.
All the life insurance
plans.
Sec. 80 CCC Across all income
slabs.
Upto Rs. 33,990
saved on
Investment of Rs.1,00,000.
All the pension plans.
Sec. 80 D Across all income
slabs
Upto Rs. 3,399
saved on
Investment of
Rs. 10,000.
All the health insurance
riders available with the
conventional plans.
TOTAL SAVINGS
POSSIBLE Rs37,389
Rs. 33,990 under Sec. 80C and under Sec. 80 CCC , Rs.3,399 under
Sec. 80 D, calculated for a male with gross annual income
exceeding Rs. 10,00,000.
Sec. 10 (10)D Under Sec. 10(10D), the benefits you receive are completely tax-free,
subject to the conditions laid down therein.
20
8/9/2019 Report Reliance Insurance
21/73
MAJOR PLAYERS IN THE INSURANCE INDUSTRY IN INDIAMAJOR PLAYERS IN THE INSURANCE INDUSTRY IN INDIA
Life Insurance Corporation of India (LIC)
Life Insurance Corporation of India (LIC) was established on 1 September 1956 to spread
the message of life insurance in the country and mobilise peoples savings for nation-
building activities. LIC with its central office in Mumbai and seven zonal offices at
Mumbai, Calcutta, Delhi, Chennai, Hyderabad, Kanpur and Bhopal, operates through 100
divisional offices in important cities and 2,048 branch offices. LIC has 5.59 lakh active
agents spread over the country.
The Corporation also transacts business abroad and has offices in Fiji, Mauritius and
United Kingdom. LIC is associated with joint ventures abroad in the field of insurance,
namely, Ken-India Assurance Company Limited, Nairobi; United Oriental Assurance
Company Limited, Kuala Lumpur; and Life Insurance Corporation (International), E.C.
Bahrain. It has also entered into an agreement with the Sun Life (UK) for marketing unit
linked life insurance and pension policies in U.K.
In 1995-96, LIC had a total income from premium and investments of $ 5 Billion while
GIC recorded a net premium of $ 1.3 Billion. During the last 15 years, LIC's income
grew at a healthy average of 10 per cent as against the industry's 6.7 per cent growth in
the rest of Asia (3.4 per cent in Europe, 1.4 per cent in the US).
LIC has even provided insurance cover to five million people living below the poverty
line, with 50 per cent subsidy in the premium rates. LIC's claims settlement ratio at 95
per cent and GIC's at 74 per cent are higher than that of global average of 40 per cent.
21
8/9/2019 Report Reliance Insurance
22/73
Compounded annual growth rate for Life insurance business has been 19.22 per cent per
annum.
General Insurance Corporation of India (GIC)
The general insurance industry in India was nationalized and a government company
known as General Insurance Corporation of India (GIC) was formed by the Central
Government in November 1972. With effect from 1 January 1973 the erstwhile 107
Indian and foreign insurers which were operating in the country prior to nationalization,
were grouped into four operating companies, namely, (i) National Insurance Company
Limited; (ii) New India Assurance Company Limited; (iii) Oriental Insurance Company
Limited; and (iv) United India Insurance Company Limited. (However, with effect from
Dec'2000, these subsidiaries have been de-linked from the parent company and made as
independent insurance companies). All the above four subsidiaries of GIC operate all
over the country competing with one another and underwriting various classes of general
insurance business except for aviation insurance of national airlines and crop insurance
which is handled by the GIC.
Besides the domestic market, the industry is presently operating in 17 countries directly
through branches or agencies and in 14 countries through subsidiary and associate
companies.
22
8/9/2019 Report Reliance Insurance
23/73
In Addition To Above State Insurers The Following Have Been Permitted
To Enter Into Insurance Business: -
The introduction of private players in the industry has added to the colors in the dull
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 decreased from
95% (2002-03) to 82 %( 2004-05).
1. HDFC Standard Life Insurance Company Ltd .
HDFC Standard Life Insurance Company Ltd. is one of Indias leading private life
insurance companies, which offers a range of individual and group insurance solutions. It
is a joint venture between Housing Development Finance Corporation Limited (HDFC
Ltd.), Indias leading housing finance institution and The Standard Life Assurance
Company, a leading provider of financial services from the United Kingdom. Their
cumulative premium income, including the first year premiums and renewal premiums is
Rs. 672.3 for the financial year, Apr-Nov 2005. They have managed to cover over
11,00,000 individuals out of which over 3,40,000 lives have been covered through our
group business tie-ups.
23
8/9/2019 Report Reliance Insurance
24/73
2. Max New York Life Insurance Co. Ltd.
Max New York Life Insurance Company Limited is a joint venture that brings together
two large forces - Max India Limited, a multi-business corporate, together with New
York Life International, a global expert in life insurance. With their various Products and
Riders, there are more than 400 product combinations to choose from. They have a
national presence with a network of 57 offices in 37 cities across India.
3. ICICI Prudential Life Insurance Company Ltd.
ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank, a
premier financial powerhouse and Prudential plc, a leading international financial
services group headquartered in the United Kingdom. ICICI Prudential was amongst the
first private sector insurance companies to begin operations in December 2000 after
receiving approval from Insurance Regulatory Development Authority (IRDA). The
company has a network of about 56,000 advisors; as well as 7 banc assurance and 150
corporate agent tie-ups.
4. Om Kotak Mahindra Life Insurance Co. Ltd.
Kotak Mahindra Old Mutual Life Insurance Ltd. is a joint venture between Kotak
Mahindra Bank Ltd. (KMBL), and Old Mutual plc.
24
8/9/2019 Report Reliance Insurance
25/73
5.Birla Sun Life Insurance Company Ltd.
Birla Sun Life Insurance Company is a joint venture between Aditya Birla Group and
Sun Life financial Services of Canada.
Tata AIG Life Insurance Company Ltd.
SBI Life Insurance Company Limited
ING Vysya Life Insurance Company Private Limited
Allianz Bajaj Life Insurance Company Ltd.
Metlife India Insurance Company Pvt. Ltd.
AMP SANMAR Assurance Company Ltd.
Dabur CGU Life Insurance Company Pvt. Ltd.
6. Royal Sundaram Alliance Insurance Company
The joint venture bringing together Royal & Sun Alliance Insurance and Sundaram
Finance Limited started its operations from March 2001. The company is Head Quartered
at Chennai, and has two Regional Offices, one at Mumbai and another one at New Delhi.
25
8/9/2019 Report Reliance Insurance
26/73
7. Bajaj Allianz General Insurance Company Limited
Bajaj Allianz General Insurance Company Limited is a joint venture between Bajaj AutoLimited and Allianz AG of Germany. Both enjoy a reputation of expertise, stability and
strength.
Bajaj Allianz General Insurance received the Insurance Regulatory and Development
Authority (IRDA) certificate of Registration (R3) on May 2nd, 2001 to conduct General
Insurance business (including Health Insurance business) in India.
8. ICICI Lombard General Insurance Company Limited
ICICI Lombard General Insurance Company Limited is a joint venture between ICICI
Bank Limited and the US-based $ 26 billion Fairfax Financial Holdings Limited. ICICI
Bank is India's second largest bank, while Fairfax Financial Holdings is a diversified
financial corporate engaged in general insurance, reinsurance, insurance claims
management and investment management.
Lombard Canada Ltd, a group company of Fairfax Financial Holdings Limited, is one of
Canada's oldest property and casualty insurers. ICICI Lombard General Insurance
Company received regulatory approvals to commence general insurance business in
August 2001.
26
8/9/2019 Report Reliance Insurance
27/73
9. TATA AIG General Insurance Company Ltd.
Tata AIG General Insurance Company Ltd. is a joint venture company, formed from theTata Group and American International Group, Inc. (AIG). Tata AIG combines the
strength and integrity of the Tata Group with AIG's international expertise and financial
strength. The Tata Group holds 74 per cent stake in the two insurance ventures while AIG
holds the balance 26 per cent stake.
Tata AIG General Insurance Company, which started its operations in India on January
22, 2001, offers the complete range of insurance for automobile, home, personal accident,
travel, energy, marine, property and casualty, as well as several specialized financial
lines.
27
8/9/2019 Report Reliance Insurance
28/73
Reliance Policies
(1) Reliance Children Plans
What could make you happier than knowing, that your child's future is secure? Nothing,
we suppose. Which is why, Reliance Life Insurance brings to you Reliance Secure Child
Plan, a unit-linked Insurance Plan, that gives you the freedom to enjoy today with your
child, because his tomorrow is in safe hands.
Do you see your child becoming a trailblazer?
Will they create the ultimate symphony or give sports a new dimension?
Our children may just be the ones to end the arms race and wipe out poverty from the
face of the Earth. But for them to be able to aim for the skies, YOU NEED TO ACT
NOW!
Introducing Reliance Secure Child Plan - a unique life insurance cum savings plan.
secure the future of your child.
Key Features
Insurance cover on the life of child Your child is completely protected - we will continue to pay the
premiums even if you are not alive Life time income to child in the event of disability Return Shield option to protect your investment returns
Liquidity in the form of partial withdrawals Capital guarantee available on maturity and on death of the child for
28
8/9/2019 Report Reliance Insurance
29/73
basic and top-up premiums Option to package with Accidental Death and Total and Permanent
Disablement Rider, Critical Conditions Rider and Term Life Insurance
Benefit Rider.
(2)Reliance Health + Wealth Policy
There are times when late working hours take precedence over your health check-ups.
And there are times when a visit to the doctor seems more important than dividends on
your shares. In the rat race to make money, we often forget to take care of ourselves.
We understand this predicament. Here is a plan that will ensure that your wealth keeps
increasing constantly and yet your health does not take a backseat. The Reliance Wealth
Health Plan. A plan that gives you the benefits of wealth bhi. health bhi.
Life changes. And as it does, so do your priorities. After all, the circumstances of your
life can determine the type of health coverage you need.
India has made rapid strides in the health sector. Since Independence, life expectancy has
gone up markedly and survival rates have also increased, still critical health issues
remain. Infectious diseases continue to claim a large number of lives.
Reliance Wealth + Health Plan, a health insurance plan underwritten by Reliance Life
Insurance Company Limited, is designed to work in conjunction with contributions
towards savings.
29
8/9/2019 Report Reliance Insurance
30/73
Key Feature
A Unit Linked plan with Unique Savings Component Twin benefit of market linked return and health protection Choose from two different plan options Flexibility to take care of your familys health Flexibility to switch between funds / plan options Option to pay Top-ups
(3) Reliance Pension Policy
Retirement means different things to different people, while some want to relax and take
a trip around the world, some want to start up a venture of their own, and pursue a dream
harnessed for years. The power to make your autumn years special lies only with you.
The Reliance Super Golden Years Plan gives you the power and the right kind of solution
- A retirement plan that allows you to save systematically and generate the much-needed
corpus to make your olden years look golden.
Key Feature
Invest systematically and secure your golden years A flexible unit-linked pension product that is different from traditional
life insurance products with Vesting Age between 45 & 70 years Eight different investment funds to choose from Flexibility to switch between funds Option to pay Regular, Single as well as Top-up premiums Flexibility to advance / extend your Vesting Age
30
8/9/2019 Report Reliance Insurance
31/73
Tax free commutation up to one third of Fund Value at Vesting Age
(4) Reliance Whole life insurance policy
Youve always loved your family. As a loving person you want to be rest assured that
they will be happy, even if something were to happen to you. With Reliance Whole Life
Plan you can be sure that your family will receive that timely financial support they need.
Go ahead, live your today to the fullest, without a worry about tomorrow.
Key Feature
Insurance protection till age 85 Choice of extending your insurance coverage till age 99 Convenient Premium Payment Term Wealth creation through bonus additions More value for your money by way of High Sum Assured Rebate Get
Sum Assured plus Bonuses in case of your unfortunate death Option to add two Riders Critical Illness and Accidental Death Benefit
and Total and Permanent Disablement Rider Policy Loan available after three full years premium payment
31
8/9/2019 Report Reliance Insurance
32/73
Chapter-3
32
8/9/2019 Report Reliance Insurance
33/73
Objective of TheStudy
Objectives of the study
To determine reasons behind opting for an insurance.
To know the most preferred policy.
To determine customers perception towards private insurance companies and their
expectation form private insurance companies.
To study the benefits provided by insurance services.
SCOPE OF THE STUDY
33
8/9/2019 Report Reliance Insurance
34/73
A big boom has been witnessed in Insurance Industry in recent times. A large number of
new players have entered the market and are vying to gain market share in this rapidly
improving market. The study deals with Reliance in focus and the various segments that
it caters to. The study then goes on to evaluate and analyze the findings so as to present a
clear picture of trends in the Insurance sector.
SIGNIFICANCE OF THE STUDY
This is a limited study which takes into consideration the responses of 100 people. This
data can be explorated to take in the trends across the industry. The significance for the
industry lies in studying these trends that emerge from the study. It is a rapidly changing
and evolving sector. People are only beginning to wake up to its vast possibilities. A
study like this can attempt to guide the future of the industry based on current trends.
Chapter-434
8/9/2019 Report Reliance Insurance
35/73
ResearchMethodology
RESEARCH METHODOLOGY
Research in common parlance refers to a search for knowledge. One can also define
research as a scientific and systematic search for pertinent information on a specific topic.
The word research has been derived from French word Researcher means to search.
FRANCIES RUMMER defined It is a careful inquiry or examination to discover new
information or relationship and to expand or verify existing knowledge.
Research is the solution of the problem, whether created or already generated.When
research is done, some new out come, so that the problem to be solved.
35
8/9/2019 Report Reliance Insurance
36/73
The finding of the research should capable of being utilized for the better performance of
the organization.
RESEARCH DESIGN
Research Design is the conceptual structure within which research is conducted. It
constitutes the blueprint for collection, measurement and analysis of data. The design
used for carrying out this research is Descriptive.
A research design is a simply the framework or plan for a study that is used as a guide in
collection and analyzing the data. It is blueprint that is followed in completing a study.
TYPES OF RESEARCH
NON-PROBABILITY
EXPLORATORY & DISCRIPTIVE EXPERIMENTAL RESEARCH
The research is primarily both exploratory as well as descriptive in nature.
TYPES OF DATA
The task of data collection begins after a research problem has been defined and research
design chalked out. While deciding about the method of data collection we should keep
in mind two types of data.
36
8/9/2019 Report Reliance Insurance
37/73
Primary Data: Primary data may be described as those data that have been
observed and recorded by the researchers for the first time to their knowledge.
Secondary Data: Secondary data are statistics not gathered for the immediate
study at hand but for other purpose. They may be describe as those data that have
been compiled by some agency other than the user.
DATA SOURCE
The sources of collection of secondary data are.
Questionnaire
Books
Websites
Magazines
Company Brochures
37
8/9/2019 Report Reliance Insurance
38/73
SAMPLING PLANS
Sampling Technique:
Initially, a rough draft was prepared keeping in mind the objective of the research. A pilot
study was done in order to know the accuracy of the Questionnaire. The final
Questionnaire was arrived only after certain important changes were done. Thus my
sampling came out to be judemental and convinent
Sampling Unit:
The respondents who were asked to fill out questionnaires are the sampling units. These
comprise of employees of MNCs, Govt. Employees, and Self Employed etc.
Sample size:
The sample size was restricted to only 100, which comprised of mainly peoples from
different regions of Gorakhpur due to time constraints.
Sampling Area:
The area of the research was Gorakhpur.
.
LIMITATIONS OF THE RESEARCH
38
8/9/2019 Report Reliance Insurance
39/73
1. The research is confined to a parts of Gorakhpur and does not necessarily shows a
pattern applicable to all of Country.
2. Some respondents were reluctant to divulge personal information which can affect
the validity of all responses.
3. In a rapidly changing industry, analysis on one day or in one segment can change
very quickly. The environmental changes are vital to be considered in order to
assimilate the findings.
39
8/9/2019 Report Reliance Insurance
40/73
MARKETING STRATREGIES OF THE COMPANY
Some of the strategies adopted by reliance life insurance Company.
Reliance Life Insurance plans to tap Reliance Communications' 2.5-crore telephony
subscriber base to market its products.
The company is considering a series of options to leverage its relationship with Reliance
Communications.
However, a joint product or a co-branded solution would require approval from the
Insurance Regulatory and Development Authority
Customers of R World, the information and entertainment portal of Reliance
Communications, would also be able to pay premiums through a bank account, provided
the bank is listed on the network.
Reliance Life Insurance officials, however, offered no comment when asked whether
there would be an arrangement for payment of commission to Reliance Communications.
As an alternative channel for distribution, insurance companies usually tie up with banks.
In the case of banc assurance, where there is a corporate agency tie-up, the commission
could range from 5 per cent to 40 per cent of first-year premium depending on the
commission loaded on to the product at the time of registration with IRDA.
40
8/9/2019 Report Reliance Insurance
41/73
Chapter-5
Data Analysis & Interpretation
DATA ANALYSIS & INTERPRETATION
41
8/9/2019 Report Reliance Insurance
42/73
1. Data gives preference of respondents of the insurance companies
Companys name No.of respondent Share (%)
L.i.c. 78 78
Reliance life insurance 3 3
Icici prudential 10 10
Sbi life 7 7
Hdfc 2 2
Total 100 100
78
3
10
7 2
LICRELICICISBI
HDFC
INTERPRETATION
78% of the people contacted prefer LIC policy to any other and therefore it is
ranked no.1 by that percent of respondents.
2. Data gives benefits of insurance perceived by respondents
42
8/9/2019 Report Reliance Insurance
43/73
Benefits No.of respondents Share (%)
Cover Future Uncertainty 55 55
Tax Deductions 20 20
Future Investment 25 25
TOTAL 100 100
INTERPRETATION
55% of the respondents believe that covering future uncertainty is the biggest
benefit of an insurance policy.
Whereas, 20% and 25% of them believe that the other benefits are Tax deduction
and future investments respectively.
3. Data provides features of insurance policy that attracted respondents
43
55%
20%
25%Cover FutureUncertainty
Tax Deductions
Future Investment
8/9/2019 Report Reliance Insurance
44/73
Feature No.of respondents Share (%)
Money Back Guarantee 15 15
Larger Risk Coverance 37 37Easy Access to Agents 7 7
Low Premium 30 30
Companys Reputation 11 11
TOTAL 100 100
FEATURES OF INSURANCE POLICY
15%
37%
7%
11%
30%
MONEY BACKGUAARENTEE
LARGER RISKCOVERANCE
EASY ACCESS TOAGENTS
LOW PREMIUM
REPUTATION OFCOMPANY
INTERPRETATION
Majority of the respondent (37%) found Larger risk coverance as the most
attracted feature of the all.
44
8/9/2019 Report Reliance Insurance
45/73
4. Data provides number of insurance policy type respondents
Policy type No. Of respondents Share (%)
Life policy 75 75
Non life policy 15 15
Both 10 10
0
10
20
30
40
50
60
70
80
NO.OF
RESPONDENT
LIFE POLICY
NON LIFE POLICY
BOTH
INTERPRETATION
75% of the respondents have Life Insurance Policy while 15% have both .
(The % is calculated out of 280 positive response)
45
8/9/2019 Report Reliance Insurance
46/73
5. Data gives people perception about insurance
Response No. Of respondents Share (%)
A saving tool 80 80%
A tax saving device 15 15%
A tool to protect your family 5 5%
0
10
20
30
40
50
60
70
80
NO.OFRESPONDENT
A saving tool
A tax savingdeviceA tool to protect
your family
INTERPRETATION
80% of the respondents have perception of Insurance being a saving tool. And 15% of the respondents have perception of Insurance being a tax saving
device.
But 5% of the respondents are with the view that Insurance is a tool to protect
your family.
46
8/9/2019 Report Reliance Insurance
47/73
6. Data shows peoples having insurance
Response No. Of respondents Share (%)
Yes 70 70%
No 30 30%
Total 100 100%
INTERPRETATION
Of the sample size of 400 surveyed respondents 70% of the respondents arehaving Insurance policy.
30% of the respondents are either not having any Insurance policy at present
or their policy is already matured.
47
70%
30%
YesNo
8/9/2019 Report Reliance Insurance
48/73
And at present 100% of the respondents are with the view that Insurance is a
tool to protect your family.
7. Data shows buying process of the people
Buying process No. Of respondents Share (%)
Customer approached Insurance
company/Agent
45 45%
Company/agent approached
customer
55 555
Total 100 100%
INTERPRETATION
44.5% of the respondents approached the Insurance Company / Agent.
Whereas, 55.5% of the respondents were approached by the Company
/Agent.
48
55%45%
Customer approached Insurance company/Agent
Company/agent approached customer
8/9/2019 Report Reliance Insurance
49/73
8. Data shows reasons behind for insurance
RESPONSE NO. OF
RESPONDENTS
SHARE (%)
Tax saving 62 62%
Saving / Investment 20 20.%
Family protection 18 18%
INTERPRETATION
62% of the Respondents opted for Insurance for tax saving benefits.
20% of the Respondents opted for saving / Investments.
But all of them, i.e. 18% of the respondents have opted for insurance for their
family protection.
49
20
18
62
Slice 1 Slice 2 Slice 3
8/9/2019 Report Reliance Insurance
50/73
9. Data shows satisfaction of respondents with respect to policy
Response No. Of respondents Share (%)
Satisfied 60 60%
Not satisfied 40 40%
Not Responded 0 0.0%
Total 100 100%
INTERPRETATION
60% of the respondents are more or less satisfied with their existing policy.
40% of the respondents are not satisfied with their existing policy.
In this case all of those who have taken a policy have responded.
50
0%
40%
60%
Satisfied Not satisfied Not Responded
8/9/2019 Report Reliance Insurance
51/73
8/9/2019 Report Reliance Insurance
52/73
11. Data shows number of respondents paying tax
Response No. Of respondents Share (%)
Paying tax 100 100%
Not paying tax - 0%
Total 100 100%
INTERPRETATION
Of the sample size of 400 respondents, all the respondents are paying tax.
52
0%
100%
Paying tax Not paying tax
8/9/2019 Report Reliance Insurance
53/73
12. Data shows respondents investments for tax saving
Investments No. Of respondents Share (%)
LIC 55 55%
NSC 17 17%
Bonds 11 11%
PPF 7 7%
PF 9 9%
EPF 11 11%
INTERPRETATION
55% of the respondents save their tax by investing in LIC, which is the
highest among all Investment. This shows that most people for getting taxes benefits
invest in LIC. 17% of the respondents do their tax saving by investing in NSC.
11% of the respondents to their tax saving by investing in bonds.
13. Data shows respondents perception about best form of investment for
securing their future
53
17
11
7
9
21
55
LIC NSC BOND PPF PF EPF
8/9/2019 Report Reliance Insurance
54/73
No. Of respondents Share (%)
Fixed Assets 25 25%
Bank deposits 30 30%Jewellery 10 10%
Securities i.e. bonds, MFs 5. 5%
Shares 2 2%
Insurance 28 28%
0
510
15
20
2530
35
no of resondent
Fixwd Assets
Bank deposit JewellerySecurities bond, MFssharesInsurance
INTERPRETATION
25% of the respondents as with the view that Fixed Assets is the best form
of investment for securing their future.
28% of the respondents are with the perception that Insurance is the best
form of investment for securing their future, which is one of the highest
and this shows that insurance is an important key for securing your future.
14. Data shows what people intent to gain from their investment
Response No. Of respondents Share (%)
54
8/9/2019 Report Reliance Insurance
55/73
Saving & Returns 45 45%
Security 20 20%
Tax benefits .35 35.%
INTERPRETATION
45% of the respondents intent to gain saving and returns from their
investment.
20% of the respondents intent to gain security from their investments.
Whereas, 35% of the respondents intent to gain tax benefits from their
investments.
15. Data gives peoples perception on appropriate age for buying insurance
55
20
3545
Saving & Returns Security Tax bene fits
8/9/2019 Report Reliance Insurance
56/73
Response No. Of respondents Share (%)
After 25 years 29 29%
After 35 years 10 10%
After 45 years 1 1%
Anytime 60 60%
INTERPRETATION
29% of the respondents are with the view that insurance should be bought
after the age of 25 years.
10% of the respondents are with the view that insurance should be buyed
after the age of 35 years.
Whereas, 60% of the respondents are with the view that buying of insurance
do not have any thing to do with age i.e. there is no age limitations. It can be
purchased any time according to the need.
56
50%
15% 5.03%30.15%
After 25 years After 35 years After 45 years Anytime
8/9/2019 Report Reliance Insurance
57/73
16. Data shows people opinion about Indian insurance companies
Response No. Of respondents Share (%)
Rigid plans 20 20%
Non user friendly 5 5%
Unsatisfactory services 7 7%
Non Aggressive 40 40%
Satisfactory 25 25%
Good 3 3%
Very good 0 0%
INTERPRETATION
57
40
25
3 0
Inflexible plans Non user friendlyUnsatisfactory services Non AggressiveSatisfactory Good
Very good
8/9/2019 Report Reliance Insurance
58/73
20% of the respondents have the opinion that Indian Insurance Companies
have Rigid plans.
5% feel that Indian Insurance companies are Non-user friendly.
7% feel that services of Indian Insurance companies are Unsatisfactory.
40% of the respondents are with the view that Indian Insurance companies
are Non-aggressive.
25% of the respondents feel that products and services of Indian Insurance
companies is Satisfactory.
Whereas only 3% feel that it is Good enough.
And according to the data, no single person has felt that it is very good.
58
8/9/2019 Report Reliance Insurance
59/73
17. Data shows what people would look for in an insurance company
Response No. Of
respondents
Share (%)
A trusted name 55 55%
Friendly service &
responsiveness
15 15%
Good plans 25 25%
Accessibility 5 5%
INTERPRETATION
55% customers look for a Trusted name in a company for insurance.
15% customers look for a good plan in a company for insurance.
Friendly service & responsiveness and Accessibility are also important factors
looked by customers in a company.
18. Data shows people planning for new investments
59
15
25
55
A trusted nameFriendly serv ice & responsive nessGood plansAccessibility
8/9/2019 Report Reliance Insurance
60/73
Response No. Of respondents Share (%)
Planning 87 87%
Not planning 13 13%
Total 100 100%
INTERPRETATION
Only 12.5% of the customers contacted are not planning for new investments
presently.
Whereas, 87.5% of the customers are still planning for new investments this
can be a great potential for Reliance Life Insurance to take them on their favor.
60
87.0%
13.0%
Planning Not planning
8/9/2019 Report Reliance Insurance
61/73
19. Data shows people interested in going for insurance if a service provider
away from the city offers better service & products
Response No. Of respondents Share (%)
Yes 43 43%
No 44 44%
Uncertain 13 13%
Total 100 100%
INTERPRETATION
The interested customers i.e. 43% are ready to go for insurance even away from a city if
services and products are worthwhile, which again is a good prospect (potential) for
Reliance Life Insurance to take them on their favor.
61
43%
44%
13%
Yes No Uncertain
8/9/2019 Report Reliance Insurance
62/73
Chapter-6 Findings &
Suggestion
FINDINGS
62
8/9/2019 Report Reliance Insurance
63/73
Our exhaustive research in the field of Life Insurance threw up some interesting trends
which can be seen in the above analysis. A general impression that we gathered during
Data collection was the immense awareness and knowledge among people about various
companies and their insurance products. People are beginning to look beyond LIC for
their insurance needs and are willing to trust private players with their hard earned
money.
People in general have been impression by the marketing and advertising campaigns of
insurance companies. A high penetration of print, radio and Television ad campaigns
over the years is beginning to have its impact now.
The general satisfaction levels among public with regards to policy and agents still
requires improvement. But therein lays the opportunity for a relative new comer like
ING. LIC has never been known for prompt service or customer oriented methods and
Reliance can build on these factors.
Suggestion
63
8/9/2019 Report Reliance Insurance
64/73
According the survey only 42% people are insured in Gorakhpur so
reaming other part is potential for insurance sector.
Among that 42% people who having insurance, they have insurance 40%
for self 28%for spouse 21% for children and 18% for their parents and
11% for all family member, also its very helpful for insurance sector so
they should take necessary step for capture this potential.
Only 42% people having insurance in Gorakhpur in that 42% there are 82
% people are under insured and other 18% people are fully insured
according to their income so that is also plus point for insurance sector to
capture the market.
64
8/9/2019 Report Reliance Insurance
65/73
Chapter-7
Questionnaire
QUESTIONNAIRE
65
8/9/2019 Report Reliance Insurance
66/73
1. Are you employed ?
Yes No
If YES, only then proceed
2. Do you have any insurance policy ?
Yes No
3. Which insurance policy do you have ?
Life Non-Life Both
4. Which companys insurance policy you prefer the most ?
(Rank them)
a) LIC
b) ICICI Prudential
c) SBI Life Insurance
d) ING VYSYA Life
e) Reliance Life Insurance
f) TATA AIG Life
G) Any Other ________( Specify)
5. For how many years do you have insurance policy ? (Please Tick)
66
8/9/2019 Report Reliance Insurance
67/73
a)
8/9/2019 Report Reliance Insurance
68/73
a)
8/9/2019 Report Reliance Insurance
69/73
A) Satisfied saving tool
B) Not satisfied
C) Not responding
14 Do you pay taxes?
Yes No
15. Where have you invested for tax saving? (Rank them)
a) LIC
b) NSC
c) BONDS
d) PPF
e) PF
17. What do you intent to gain from investments?
a) Saving & returns
b) Security
c) Tax benefits
18. Whats the right age to buy insurance ?
69
8/9/2019 Report Reliance Insurance
70/73
a) After 25 yrs
b) After 35 yrs
c) After 45 yrs
d) Anytime
20. Are you planning for new investments?
Planning Not planning
21. Would you go for insurance if a service provider away from the city offers better
service & products?
a) Yes
b) No
c) Uncertain
Thank you Name : _________________________
Address : ______________________
______________________________
Occupation: ___________________
70
8/9/2019 Report Reliance Insurance
71/73
Chapter-8
Bibliography
BIBLIOGRAPHY
71
8/9/2019 Report Reliance Insurance
72/73
1. Books/magazines referred:
Study guide- principles & practices of life / general insurance, by AIMA.
Books published by insurance institute of India
Life-insurance, by mc gill
Insurance watch.
Money outlook.
2. Websites referred:
www.reliancelife.co.in
www.cifainsurance.com
www.moneyoutlook.com
www.insurance.ind.com
3. Reports /articles referred:
Report: issues & challenges facing the insurance industry. dec2008.
72
http://www.cifainsurance.com/http://www.moneyoutlook.com/http://www.insurance.ind.com/http://www.cifainsurance.com/http://www.moneyoutlook.com/http://www.insurance.ind.com/8/9/2019 Report Reliance Insurance
73/73
Brief profile of LIC, IndiaDec 2008.