Chapter1

Company Profile

COMPANY PROFILE OF HDFC STANDARD LIFE INSURANCE COMPANY LTD

ABOUT HDFC STANDARD LIFE INSURANCE
HDFC Standard Life, one of Indias leading private life insurance companies, offers a range of individual and group insurance solutions. It is a joint venture between Housing Development Finance Corporation Limited (HDFC), Indias leading housing finance institution and Standard Life plc, the leading provider of financial services in the United Kingdom. HDFC Ltd. holds 72.43% and Standard Life (Mauritius Holding) Ltd. holds 26.00% of equity in the joint venture, while the rest is held by others. HDFC Standard Lifes product portfolio comprises solutions, which meet various customer needs such as Protection, Pension, Savings, Investment and Health. Customers have the added advantage of customizing the plans, by adding optional benefits called riders, at a nominal price. The company currently has 32 retail and 4 group products in its portfolio, along with five optional rider benefits catering to the savings, investment, protection and retirement needs of customers. HDFC Standard Life continues to have one of the widest reaches among new insurance companies with 568 branches servicing customer needs in over 700 cities and towns. The company has a strong presence in its existing markets with a base of 2,00,000 Financial Consultants.

HDFC STANDARD LIFE INSURANCE PARENTAGE

HDFC Limited HDFC Limited, India's premier housing finance institution has assisted more than 3.4 million families own a home, since its inception in 1977 across 2400 cities and towns through its network of over 271 offices. It has international offices in Dubai, London and 2

Singapore with service associates in Saudi Arabia, Qatar, Kuwait and Oman to assist NRI's and PIO's to own a home back in India. As of December 2009, the total asset size has crossed more than Rs. 104,560 crores including the mortgage loan assets of more than Rs.90,400 crores. The corporation has a deposit base of over Rs. 23,000 crores, earning the trust of nearly one million depositors. Customer Service and satisfaction has been the mainstay of the organization. HDFC has set benchmarks for the Indian housing finance industry. Recognition for the service to the sector has come from several national and international entities including the World Bank that has lauded HDFC as a model housing finance company for the developing countries. HDFC has undertaken a lot of consultancies abroad assisting different countries including Egypt, Maldives, and Bangladesh in the setting up of housing finance companies.

Standard Life Standard Life is one of the UK's leading long term savings and investments companies headquartered in Edinburgh and operating internationally. Established in 1825, Standard Life provides life assurance and pensions, investment management and healthcare insurance products to over 6 million customers worldwide. The Group has around 10,000 employees across the UK, Canada, Ireland, Germany, Austria, India, USA, Hong Kong and mainland China. At the end of December 2010 the Group had total assets under administration of 170.1bn. Standard Life's diverse business includes one of the largest life and pensions businesses in the UK with more than 4 million customers; Standard Life Investments, which currently manages assets of over 138.7bn globally and Standard Life Healthcare, a private medical insurance company which is one of the largest in the UK. On 10 July 2006, after 80 years as a mutual company, Standard Life Assurance Company demutualised and Standard Life plc was listed on the London Stock Exchange. Standard Life now has approximately 1.5 million individual shareholders in over 50 countries around the world.

Vision & Values

Vision 'The most successful and admired life insurance company, which means that we are the most trusted company, the easiest to deal with, offer the best value for money, and set the standards in the industry'. 'The most obvious choice for all'. Values Values that we observe while we work:

Integrity Innovation Customer centric People Care One for all and all for one Team work Joy and Simplicity

Besides the above (which provides an insight into the Corporate Structure of the Company), the Committees appointed by the Board focus on specific areas and take informed decisions within the framework of delegated authority, and make specific recommendations to the Board on matters within their areas of purview. All decisions and recommendations of the Committees are placed before the Board for information or for approval.

Awards & Accolades

Year 2010 Best Companies to Work for in India in 2010 HDFC Standard Life has been adjudged one of the Best Companies to Work for in India in 2010. The company participated in the Great Places to Work study for the first time and ranked first in the insurance category. It ranked 34th on the Top 50 Best Companies to Work for, in India 2010 list. The company was also awarded for its unique employee initiative - Mission in-Genius national quiz. The study has shown that HDFC Standard Life conscientiously develops employee talent programmes to keep engaging and motivating its employees. The company provides some unique platforms such as 'Mission in Genius' national quiz. The management is accessible to all at all times and sincerely seeks feedback from its employees through programmes such as 'Sparsh', the study said. The Best Companies to Work in India is a study conducted by the Great Place to Work Institute, India in partnership with The Economic Times. The 2010 edition is the seventh study in India, which received overwhelming response from more than 400 companies, making it the largest such study in India. And only 50 companies made it to the Best Companies to Work list!

'YoungStar Super' Voted 'Product of the Year 2010' HDFC Standard Lifes YoungStar Super has been voted Product of the Year 2010 in the 'Insurance' category by more than 30,000 consumers nationwide across 36 markets. YoungStar Super is an unit linked Children Plan

with unique benefits such as bumper additions, double and triple benefits, attractive allocations rates, and seven different funds. The consumer study on product innovation in India was conducted by A C Nielsen, the leading global research firm. Entries were accepted from products that demonstrate innovation in their product function, design, packaging or process or any other specified form. Entries were then filtered by a jury of distinguished industry professionals to ensure that the products meet the innovation criteria before they were passed on to the consumer votes/survey round. Product of the Year is an Internationally Recognized Standard that celebrates and rewards the best innovations in consumer products and services. The Product of the Year is selected through an independent consumer survey across the country in 26 countries for the past 20 years.

Year 2009 Received CIO 'The Ingenius 100 2009' Award HDFC Standard Life has received the CIO The Ingenious 100 - 2009 Award, for ATLAS (Agency Training Licensing and Servicing System). Additionally, the company has received the CIO 100 Security Award 2009 for pioneering LANDesk Management and Security Suite security implementation and taking its security to a higher level of technological excellence. HDFC Standard has received the CIO 100 Award for the third consecutive year. It had received the 2008 CIO Bold Award for Consultant Corner and CIO Security Award for our initiatives for a secure computing environment, including Sesame - Identity and Access Management. In 2007, the company received CIO 100 award for Wonders and a Special Award in Storage category. CIO magazine has a long tradition of honoring leading companies for business and technology leadership and innovations through its flagship award program CIO 100. 6

Its a celebration of 100 organizations (and the people within them) that are using IT in innovative ways to deliver business value, whether by creating competitive advantage, optimizing business processes, enabling growth or improving relationships with customers.

Received Diamond EDGE Award 2009 HDFC Standard Life has received the Diamond EDGE Award 2009 for its mobile workforce portal - Consultant Corner. EDGE - Enterprises Driving Growth and Excellence (using IT) is an initiative by the , Network Computing magazine to identify, recognise, and honour end-user companies in India that have demonstrated the best use of technology to solve a business problem, improve business competitiveness, and deliver quantifiable ROI to stakeholders. Network Computing magazine is part of CMP Technology, which brings more than 100 IT media brands to more than 18 million technology and business decision makers worldwide.

Business Strengths & Key Differentiators

HDFC Standard Life believes that establishing a strong and ethical foundation is an essential prerequisite for long-term sustainable growth. To ensure this, we have concentrated our focus on expansion of branch network, organising an efficient and well trained sales force, and setting up appropriate systems and processes with optimum use of technology. As all these areas form the basic infrastructure for establishing the highest possible customer service standards. Our core values are drilled down to all levels of employees, as these are inviolable. We continue to promote high integrity in business practices and shun short cuts and unethical practices, as we wish to be perceived as an institution with high moral standing. Since our 7

inception in 2000, when the Indian insurance space was opened for private participation, we have consistently focused on setting benchmarks in all aspect on insurance business. Being the first private player to be registered with the IRDA and the first to issue a policy on December 12, 2000, our differentiators are: Strong Promoter: HDFC Standard Life is a strong, financially secure business supported by two strong and secure promoters HDFC Ltd and Standard Life. HDFC Ltds excellent brand strength emerges from its unrelenting focus on corporate governance, high standards of ethics and clarity of vision. Standard Life is a strong, financially secure business and a market leader in the UK Life & Pensions sector. Preferred and trusted brand: Our brand has managed to set a new standard in the Indian life insurance communication space. We were the first private life insurer to break the ice using the idea of self-respect instead of death to convey our brand proposition (Sar Utha Ke Jiyo). Today, we are one of the few brands that customers recognize, like and prefer to do business. Moreover, our brand thought, Sar Utha Ke Jiyo, is the most recalled campaign in its category. Investment philosophy: We follow a conservative investment management philosophy to ensure that our customers money is looked after well. The investment policies and actions are regularly monitored by a formal Investment Committee comprising non-executive directors and the Principal Officer & Executive Director. As a life insurance company, we understand that customers have invested their savings with us for the long term, with specific objectives in mind. Thus, our investment focus is based on the primary objective of protecting and generating good, consistent, and stable investment returns to match the investors long-term objective and return expectations, irrespective of the market condition.

Need based selling approach: Despite the criticality of life insurance, sales in the industry have been characterized by over reliance on tax benefits and limited advice-based selling. Our eight-step structured sales process Disha however, helps customers understand their latent needs at the first instance itself without focusing on product features or tax benefits. Need-based selling process, 'Disha', the first of its kinds in the industry, looks at the whole financial picture. Customers see a plan not piecemeal product selling.

Risk control framework: HDFC Standard Life has fully implemented a risk control framework to ensure that all types of risks (not just financial) are identified and measured. These are regularly reported to the board and this ensures that the company management and board members are fully aware of any risks and the actions taken to ensure they are mitigated.

Focus on training: Training is an integral part of our business strategy. Almost all employees have undergone training to enhance their technical skills or the softer behavioural skills to be able to deliver the service standards that our company has set for itself. Besides the mandatory training that Financial Consultants have to undergo prior to being licensed, we have developed and implemented various training modules covering various aspects including product knowledge, selling skills, objection handling skills and so on.

Focus on long term value: HDFC Standard Life do not focus in the business of ramping up the topline only, but to create maximization of stakeholder's value. Today, we are extremely satisfied with the base that we have created for the longterm success of this company.

Transparent dealing: We are one of the few companies whose product details, pricing, clauses are clearly communicated to help customers take the right decision.

Strict compliance with regulations: We have initiated and implemented many new processes, some of which were found useful by the IRDA and later made mandatory for the entire industry. The agents who successfully completed this training only, were authorized by the company to sell ULIPs. This has now been made compulsory by IRDA for all insurance companies under the new Unit Linked Guidelines.

Diversified product portfolio: HDFC Standard Lifes wide and diversified product portfolio help individuals meet their various needs, be it: 1. Protection: Need for a sound income protection in case of your unfortunate demise 2. Investment: Need to ensure long-term real growth of your money 3. Savings: Save for the milestones and protect your savings too 4. Pension: Need to save for a comfortable life post retirement 5. Health: Cover for health related exigencies

Brief Profile of the Board of Directors

The Board is responsible to act in the best interests of the Company and its shareholders. In discharging their duties the Directors shall comply with the Code of Conduct as adopted by the Board. Directors are expected to attend and actively participate in Board Meetings and Meetings of Committees on which they serve and to spend the time needed and meet as frequently as necessary to properly discharge their responsibilities. The Board is responsible for overall compliance with the corporate governance policy of the Company. It oversees and directs the management of the Companys business and affairs. In doing so, it must act honestly, in good faith and in the best interests of the Company . 10

Mr. Deepak S. Parekh is the Chairman of the Company. He is also the Chairman and Director of Housing Development Finance Corporation Limited (HDFC Limited). He joined HDFC Limited in a senior management position in 1978. He was inducted as a whole-time director of HDFC Limited in 1985 and was appointed as its Chairman in 1993. Mr. Parekh is a Fellow of the Institute of Chartered Accountants (England & Wales).

Mr. Keki M. Mistry joined the Board of Directors of the Company in December, 2000. He is currently the Vice Chairman and Chief Executive Officer of HDFC Limited. He joined HDFC Limited in 1981 and became an Executive Director in 1993. He was appointed as its Managing Director in 2000. Mr. Mistry is a Fellow of the Institute of Chartered Accountants of India and a member of the Michigan Association of Certified Public Accountants.

Ms. Renu S. Karnad is the Managing Director of HDFC Limited. She is a graduate in Law and holds a Master's degree in Economics from Delhi University. She has been employed with HDFC Limited since 1978 and was appointed as the Executive Director in 2000 and Deputy Managing Director in 2007. She is responsible for overseeing all aspects of lending operations of HDFC Limited.

Mr. David Nish joined Standard Life on 1 November 2006 as Group Finance Director and remained in that position until December 2009. 11

He is appointed as the Executive Europe on 1st January 2010. In 2000 he was awarded the Scottish Business Awards Finance Director of the Year and from 2004 to 2005 he served on the Government Employers Pension Task Force. He is a member of the Institute of Chartered Accountants of Scotland. He joined the Board of Directors in February 2010.

Mr. Nathan Parnaby is appointed as the Chief Executive, Europe & Asia of Standard Life in the year 2010. Nathan joined Standard Life in 1982 as Investment Manager, responsible for all UK net funds. He was appointed a Director of the Standard Life Investments board. He is a Mathematics graduate from Oxford University and the Member of the Securities Institute. He joined the Board of Directors in December 2009.

Mr. Norman K. Skeoch is currently the Chief Executive in Standard Life Investments Limited and is responsible for overseeing Investment Process & Chief Executive Officer Function. Prior to this, Mr. Skeoch was working with M/s. James Capel & Co. holding the positions of UK Economist, Chief Economist, Executive Director, Director of Controls and Strategy HSBS Securities and Managing Director International Equities. He was also responsible for Economic and Investment Strategy research produced on a worldwide basis. Mr. Skeoch joined the Board of Directors in November 2005.

Mr. Gautam R. Divan is a practising Chartered Accountant and is a Fellow of the Institute of Chartered Accountants of India. Mr. Divan was the Former Chairman and Managing Committee Member of Midsnell Group International, an International Association of 12

Independent Accounting Firms and has authored several papers of professional interest. Mr. Divan has wide experience in auditing accounts of large public limited companies and nationalised banks, financial and taxation planning of individuals and limited companies and also has substantial experience in structuring overseas investments to and from India. Mr. Ranjan Pant is a global Management Consultant advising CEO/Boards on Strategy and Change Management. Mr. Pant, until 2002 was a Partner & Vice-President at Bain & Company, Inc., Boston, where he led the worldwide Utility Practice. He was also Director, Corporate Business Development at General Electric headquarters in Fairfield, USA. Mr. Pant has an MBA from The Wharton School and BE (Honours) from Birla Institute of Technology and Sciences.

Mr. Ravi Narain is the Managing Director & CEO of National Stock Exchange of India Limited. Mr. Ravi Narain was a member of the core team to set-up the Securities & Exchange Board of India (SEBI) and is also associated with various committees of SEBI and the Reserve Bank of India (RBI).

Mr. A. K.T. Chari has joined HDFC Standard Life as a Director on March 10, 2010. Mr. Chari has completed his Electrical Engineering from Madras University in 1962. He is associated with Infrastructure Development Finance Company Ltd. (IDFC) for last 11 years. Currently he is handling project finance for infrastructure projects at IDFC. Prior to this he was associated with Infrastructure Development Bank of India (IDBI) from 1975 to 1999.

Mr. Gerald E. Grimstone was appointed Chairman of Standard Life in May 2007, having been Deputy Chairman since March 2006. He 13

became a director of the Standard Life Assurance Company in July 2003. He is also Chairman of Candover Investments plc and was appointed as one of the UKs Business Ambassadors by the Prime Minister in January 2009. Gerry held senior positions within the Department of Health and Social Security and HM Treasury until 1986. He then spent 13 years with Schroders in London, Hong Kong and New York, and was Vice Chairman of Schroders worldwide investment banking activities from 1998 to 1999. He is the Alternate Director to Mr. David Nish.

Mr. Michael G Connarty is responsible for Standard Life's investments in life assurance Joint Ventures in India and China. He holds a degree in Law and MBA. He has worked with Standard Life for 33 years in managerial positions covering a number of fields such as Pensions law, International Marketing, Operational Management, Strategy, Risk, Compliance, Company Secretarial and Banking. He has acted as Project Manager for the start-up project of the Company in 2000. He is the Alternate Director to Mr. Norman K. Skeoch.

Mr. Amitabh Chaudhry is the MD and CEO of HDFC Standard Life. Before joining HDFC Standard Life, he was the MD and CEO of Infosys BPO and was also heading an Independent Validation Services unit in Infosys Technologies. He started his career with Bank of America delivering diverse roles ranging from Head of Technology Investment Banking for Asia, Regional Finance Head for Wholesale Banking and Global Markets and Chief Finance Officer of Bank of America (India). He moved to Credit Lyonnais Securities in 2001 in Singapore where he headed their investment banking franchise for South East Asia and structured finance practice for Asia before joining Infosys BPO in 2005. Mr. Chaudhry completed his Engineering in 1985 from Birla Institute of Technology and Science, Pilani and MBA in 1987 from IIM, Ahmedabad.

14

Mr. Paresh Parasnis is the Executive Director and Chief Operating Officer of the company. A fellow of the Institute of Chartered Accountants of India, he has been associated with the HDFC Group since 1984. During his 16-year tenure at HDFC Limited, he was responsible for driving and spearheading several key initiatives. As one of the founding members of HDFC Standard life, Mr. Parasnis has been responsible for setting up branches, driving sales and servicing strategy, leading recruitment, contributing to product launches and performance management system, overseeing new business and claims settlement, customer interactions etc.

Associate Companies

HDFC Helping Indians experience the joy of home ownership. The road to success is a tough and challenging journey in the dark where only obstacles light the path. However, success on a terrain like this is not without a solution. As we found out nearly three decades ago, in 1977, the solution for success is customer satisfaction. All you need is the courage to innovate, the skill to understand your clientele and the desire to give them your best. Today, nearly three million satisfied customers whose dream we helped realize, stand testimony to our success. Our objective, from the beginning, has been to enhance residential housing stock and promote home ownership. Now, our offerings range from hassle-free home loans and deposit products, to property related services and a training facility.

15

We also offer specialized financial services to our customer base through partnerships with some of the best financial institutions worldwide. HDFC Bank The Housing Development Finance Corporation Limited (HDFC) was amongst the first to receive an 'in principle' approval from the Reserve Bank of India (RBI) to set up a bank in the private sector, as part of the RBI's liberalization of the Indian Banking Industry in 1994. The bank was incorporated in August 1994 in the name of 'HDFC Bank Limited', with its registered office in Mumbai, India. HDFC Bank commenced operations as a Scheduled Commercial Bank in January 1995.

HDFC Mutual Fund HDFC Mutual Fund has been one of the best performing mutual funds in the last few years. HDFC Asset Management Company Limited (AMC) functions as an Asset Management company for the HDFC mutual fund. AMC is a joint venture between housing finance giant HDFC and British investment firm Standard Life Investments Limited. It conducts the operations of the Mutual Fund and manages assets of the schemes, including the schemes launched from time to time. As of Aug 2006, the fund has assets of Rs.25,892 crores under management. In 2003, following a decision by the Zurich Insurance Company (ZIC), the Sponsor of Zurich India Mutual Fund, to divest its asset management business in India, AMC had entered into an agreement with ZIC to acquire the asset management business. Consequently, all the schemes of Zurich Mutual Fund in India had been transferred to HDFC mutual fund and renamed as HDFC schemes.

HDFC Sales 16

HDFC Sales is a wholly owned subsidiary of HDFC Ltd. The company has been floated as a distribution arm of HDFC with an objective of offering doorstep service to prospective clients of HDFC group. HDFC Sales offers financial management solutions to individuals encompassing among other products Home Loans, Life Insurance, Mutual Funds, Fixed Deposits and property Solutions. Home Loans: HDFC Sales is present in over 100 locations across the country with 55 offices and over 1750 employees. Financial Management: HDFC Sales offers financial management solutions in 9 cities and is continuously expanding its reach. HDFC Sales employs sales persons across all spectrums of financial management enabling them to meet a range of financial needs. HDFC Realty: HDFC Sales manages the HDFC Realty business and the Website (hdfcrealty.com) which offers property solutions buying, selling, leasing to Individuals and Corporates. HDFC Realty is present in all the major cities in India as well as in Dubai. The company mirrors the philosophy and values of its parent, HDFC. "HDFC's finest investment is in its Human Resources. It draws its personnel from many disciplines. They are the building blocks on which the company's performance & productivity is based". H T Parekh, Founder - Chairman, HDFC HDFC Sales values integrity, commitment, teamwork and excellence in customer service. Our most valuable assets are our Human Resources. We are truly proud that today we have a highly motivated team of sales persons and that we have the lowest employee turnover rate in the Industry.

HDFC ERGO HDFC ERGO General Insurance Company Limited is a 74:26 joint venture between HDFC Limited, Indias premier Housing 17

Finance Institution & ERGO International AG, the primary insurance entity of Munich Re Group. HDFC ERGO focuses on providing the Right Insurance Solution for all. We offer our customers complete range of general insurance products ranging from Motor, Health, Travel, Home and Personal Accident in the retail space and customized products like Property, Marine and Liability Insurance in the corporate space. It is our constant endeavor to improvise and cater to every need of the modern day customer with superior customer support service. This helps us give our customers a seamless and hassle-free experience. HDFC ERGO has been expanding its presence across the country and is today present across 71 cities with 78 branch offices with an employee base of over 950 professionals. The company has a right balance of distribution channel comprising of Dealerships, Brokers, Retail and Corporate Agents, Bancassurance and Direct Sales Team.

Other Companies

HDFC Trustee Company Ltd. GRUH Finance Ltd. HDFC Developers Ltd. HDFC Property Ventures Ltd. HDFC Ventures Trustee Company Ltd. HDFC Investments Ltd. HDFC Holdings Ltd. Credit Information Bureau (India) Ltd HDFC Securities 18

HDFC Standard Life Milestones

Received the PCQuest Best IT Implementation Award 2008 for Consultant Corner, the applications for its financial consultants, providing centralized control over a vast geographical spread for key business units such as inventory, training, licensing, etc. Received the 2008 CIO Bold 100 Award for its mobile workforce portal and the Special 2008 CIO Security Award for a secure computing environment, including identity management respectively. Mr. Deepak M Satwalekar Awarded QIMPRO Gold Standard Award. HDFCSL expanded its reach in the Bancassurance channel by arrangements with co-operative banks in the rural areas. Continued to increase its focus on quality service, by putting in place a robust mechanism to capture Voice of the Customer through service audits across its offices. This was complemented by use of technology that enabled capture of all interactions with customers across all touch points Sar Utha Ke Jiyo was honoured as Among Indias 60 Glorious Advertising Moments. The advertisements of the company were ranked 6th amongst The 10 most effective Advertisements in September 2007. Received the PCQuest Best IT Implementation Award 2007 for Wonders, its path-breaking implementation of an enterprise-wide workflow system. In addition the company also bagged the EMC storage award for being the most innovative users of storage and storage management. Pension Plan Tops Mints Survey of Best TV Ads. HDFC Standard Lifes advertising created high awareness for the brand and bagged 2 silver and 1 bronze awards at the ADFEST 2007 National Awards 19

organised by the Advertising Agencies Association of India (AAAI). The 3 awards are the highest won by any single brand in the financial services business (including banking, mutual fund, insurance and other financial services). Ranked 29th most trusted Indian Brands amongst the Top 50 Service Brands of 2006 according to a study conducted by the Brand Equity Economic Times, the leading business publication of India.

Corporate Governance
Introduction The Corporate Governance Policy provides the framework under which the Board of Directors operates. It includes its corporate structure, culture, policies and the manner in which it deals with various stakeholders. The governance policies address the responsibilities, authority and administration of the Board of Directors. The policies also include the responsibilities of the Principal Officer and define the reporting relationships. Timely and accurate disclosure of information regarding the financial situation, performance, board constitution, ownership of the company etc. is an important part of corporate governance. Corporate governance arrangements are those through which an organization directs and controls itself and the people associated with it. The Policy is normally reviewed annually and modified when appropriate to ensure proper alignment with best practices in corporate governance. Companys Philosophy Corporate Governance is a process that aims to meet stakeholders aspirations and societal expectations. It is not a discipline imposed by a Regulator, rather is a culture that guides the Board, Management and Employees to function towards best interest of Stakeholders.

20

At HDFCSL, Corporate Governance philosophy stems from the belief that corporate governance is a key element in improving efficiency and growth as well as enhancing investor confidence. Accordingly, the Corporate Governance philosophy has been scripted as under: As a good corporate citizen, the Company is committed to sound corporate practices based on its vision, values & principles in building confidence of its various stakeholders, thereby paving the way for its long term success and sustenance. At the core of its corporate governance practice is the Board, which oversees how the management serves and protects the long-term interests of all the stakeholders of the Company. The Company believes that an active, well-informed and independent Board is necessary to ensure the highest standards of corporate governance. The Companys corporate governance practices are aimed at meeting the corporate governance requirements as per the IRDA Corporate Governance Guidelines, besides good practices either recommended by professional bodies or practised by leading companies in India. . The following Corporate Governance Policy has been adopted by the Board of Directors to assist the Board in the exercise of its responsibilities. This Policy is subject to future amendments or changes, as may be necessary, in the light of the amendments in various regulations in force for governance requirements.

Products of HDFC Standard Life Insurance

1. Protection Plans: They help you shield your family from uncertainties in life due to financial losses in terms of loss of income that may dawn upon them incase of your untimely demise or critical illness. Securing the future of ones family is one of the most important goals of life. Protection Plans go a long way in ensuring your familys financial independence in the event of your unfortunate demise or critical illness. They are all the more important if you are the chief wage earner in your family. No matter how much you have saved or invested over the years, 21

sudden eventualities, such as death or critical illness, always tend to affect your family financially apart from the huge emotional loss. Types of Protection Plans HDFC Term Assurance Plan HDFC Premium Guarantee Plan HDFC Loan Cover Term Assurance Plan HDFC Home Loan Protection Plan

2. Retirement Plans: They provide you with financial security so that when your professional income starts to ebb, you can still live with pride without compromising on your living standards. By providing you a tool to accumulate and invest your savings, these plans give you a lump sum on retirement, which is then used to get regular income through an annuity plan. Given the high cost of living and rising inflation, employer pensions alone are not sufficient. Pension planning has therefore become critical today. Type of Retirement Plan HDFC Personal Pension Plan

3. Savings & Investment Plans: They provide you the assurance of lump sum funds for your and your familys future expenses. While providing an excellent savings tool for your short term and long term financial goals, these plans also assure your family a certain sum by way of an insurance cover. With HDFC Standard Lifes range of Saving & Investment Plans, you can therefore ensure that your family always remains financially independent, even if you are not around. Types of Savings & Investment Plans

22

HDFC Endowment Assurance Plan HDFC SL New Money Back Plan HDFC Money Back Plan HDFC Assurance Plan HDFC Savings Assurance Plan HDFC SL ProGrowth Super II HDFC Single Premium Whole of Life Insurance Plan HDFC SL Crest

4. Health Plans: They give you the financial security to meet health related contingencies. Due to changing lifestyles, health issues have acquired completely new dimension overtime, becoming more complex in nature. It becomes imperative then to have a health plan in place, which will ensure that no matter how critical your illness is, it does not impact your financial independence. Types of Health Plans HDFC Critical Care Plan HDFC SurgiCare Plan

5. Childrens Plans: They helps you save so that you can fulfill your childs dreams and aspirations. These plans go a long way in securing your childs future by financing the key milestones in their lives even if you are no longer around to oversee them. As a parent, you wish to provide your child with the very best that life offers, the best possible education, marriage and life style. Types of Childrens Plans HDFC Children's Plan 23

HDFC SL YoungStar Super II

Chapter2
Industry Profile

24

INSURANCE IN INDIA
The insurance sector in India has come a full circle from being an open competitive market to nationalisation and back to a liberalised market again. Tracing the developments in the Indian insurance sector reveals the 360 degree turn witnessed over a period of almost two centuries.

A brief history of the 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: 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 nationalised. LIC formed by an Act of Parliament, viz. LIC Act,1956, with a capital contribution of Rs. 5 crore from the Government of India.

25

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.

Insurance Sector Reforms

In 1993, Malhotra Committee headed by former Finance Secretary and RBI Governor R.N. Malhotra was formed to evaluate the Indian insurance industry and recommend its future direction. The Malhotra committee was set up with the objective of complementing the reforms initiated in the financial sector. The reforms were aimed at creating a more efficient and competitive financial system suitable for the requirements of the economy keeping in mind the structural changes currently underway and recognising that insurance is an important part of the overall financial system where it was necessary to address the need for similar reforms In 1994, the committee submitted the report and some of the key recommendations included:

i.

Structure
Government stake in the insurance Companies to be brought down to 50%. Government should take over the holdings of GIC and its subsidiaries so that these subsidiaries can act as independent corporations. All the insurance companies should be given greater freedom to operate

ii.

Competition
Private Companies with a minimum paid up capital of Rs.1bn should be allowed to enter the industry.

26

No Company should deal in both Life and General Insurance through a single entity. Foreign companies may be allowed to enter the industry in collaboration with the domestic companies. Postal Life Insurance should be allowed to operate in the rural market. Only one State Level Life Insurance Company should be allowed to operate in each state.

iii.

Regulatory Body
The Insurance Act should be changed. An Insurance Regulatory body should be set up. Controller of Insurance (Currently a part from the Finance Ministry) should be made independent.

iv.

Investments
Mandatory Investments of LIC Life Fund in government securities to be reduced from 75% to 50%. GIC and its subsidiaries are not to hold more than 5% in any company (There current holdings to be brought down to this level over a period of time)

v.

Customer Service
LIC should pay interest on delays in payments beyond 30 days. Insurance companies must be encouraged to set up unit linked pension plans. Computerization of operations and updating of technology to be carried out in the Insurance industry.

The committee emphasized that in order to improve the customer services and increase the coverage of the insurance industry should be opened up to competition. But at the

27

same time, the committee felt the need to exercise caution as any failure on the part of new players could ruin the public confidence in the industry. Hence, it was decided to allow competition in a limited way by stipulating the minimum capital requirement of Rs.100 crores. The committee felt the need to provide greater autonomy to insurance companies in order to improve their performance and enable them to act as independent companies with economic motives. For this purpose, it had proposed setting up an independent regulatory body.

The Insurance Regulatory and Development Authority (IRDA)

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. The other decisions taken simultaneously to provide the supporting systems to the insurance sector and in particular the life insurance companies was the launch of the IRDAs 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, which are expected to be introduced by early next year. Since being set up as an independent statutory body the IRDA has put in a framework of globally compatible regulations. In the private sector 12 life insurance and 6 general insurance companies have been registered.

28

INSURANCE COMPANIES IN INDIA

Aegon Religare Aviva Bajaj Allianz Bharti Axa Life Birla Sun Life Canara HSBC OBC Life DLF Pramerica Future Generali Life HDFC Standard Life ICICI Pru IDBI Fortis Life ING Vysya Kotak Life Insurance Max New York Life Metlife India Reliance Life Insurance Sahara Life SBI Life Insurance Shriram Life Star Union Dai-ichi Life Tata AIG

Aegon Religare Life

AEGON, an international life insurance, pension and investment company, Religare, one of Indias leading integrated financial services groups and Bennett, Coleman & company, Indias largest media house, have come together to launch AEGON Religare Life Insurance Company Limited . This venture is dedicated to build a firm future, both for customers and employees and will continue to balance a local approach with the power of an expanding global operation.

29

We launched our pan-India multi-channel operations in July, 2008 with over 30 branches spread across India. Our business philosophy is to help people plan their life better. We provide high quality advice to our customers and offer superior customer service.

Aviva India
Aviva India is a joint venture between one of the countrys oldest and largest groups, Dabur, and Aviva plc, the UK's largest insurance group, whose association with India dates back to 1834. Dabur Group Founded in 1884, Dabur Group is one of India's oldest and largest group of companies with a consolidated annual turnover in excess of Rs 2,396 crores. A professionally managed company, it is the country's leading producer of traditional healthcare products. Aviva Group Aviva Group is the UKs largest and one of the biggest Insurance groups worldwide. It is one of the leading providers of life and pensions products to Europe and has substantial businesses elsewhere around the world. With a history dating back to 1696, Aviva Group has a 50 million customer base worldwide.

Bajaj Allianz Life Insurance Co Ltd

Bajaj Allianz Life Insurance is a union between Allianz SE, one of the largest Insurance Company and Bajaj Finserv. Allianz SE is a leading insurance conglomerate globally and one of the largest asset managers in the world, managing assets worth over a Trillion (Over INR. 55, 00,000

30

Crores). Allianz SE has over 115 years of financial experience and is present in over 70 countries around the world.

Bharti AXA Life Insurance CO Ltd.

Bharti AXA Life Insurance is a joint venture between Bharti, one of Indias leading business groups with interests in telecom, agri business and retail, and AXA, world leader in financial protection and wealth management. The joint venture company has a 74% stake from Bharti and 26% stake of AXA. The company launched national operations in December 2006. Today, we have over 8000 employees across over 12 states in the country and a national footprint of distributors trained to provide quality financial advice and insurance solutions to the large Indian customer base. As we further expand our presence across the country with a large network of distributors, we continue to provide innovative product and service offerings to cater to specific insurance and wealth management needs of customers. Whatever your plans in life, you can be confident that Bharti AXA Life will offer the right financial solutions to help you achieve them.

Birla Sun Life Insurance Company Limited

Established in 2000, Birla Sun Life Insurance Company Limited (BSLI) is a joint venture between the Aditya Birla Group, a well known and trusted name globally amongst Indian conglomerates and Sun Life Financial Inc, leading international financial services organization from Canada. The local knowledge of the Aditya Birla Group combined with the domain expertise of Sun Life Financial Inc., offers a formidable protection for its customers future.

31

With an experience of over 9 years, BSLI has contributed significantly to the growth and development of the life insurance industry in India and currently ranks amongst the top 5 private life insurance companies in the country. Known for its innovation and creating industry benchmarks, BSLI has several firsts to its credit. It was the first Indian Insurance Company to introduce Free Look Period and the same was made mandatory by IRDA for all other life insurance companies. Additionally, BSLI pioneered the launch of Unit Linked Life Insurance plans amongst the private players in India. To establish credibility and further transparency, BSLI also enjoys the prestige to be the originator of practice to disclose portfolio on monthly basis. These category development initiatives have helped BSLI be closer to its policy holders expectations, which gets further accentuated by the complete bouquet of insurance products (viz. pure term plan, life stage products, health plan and retirement plan) that the company offers. Add to this, the extensive reach through its network of 600 branches and 1,75,000 empanelled advisors. This impressive combination of domain expertise, product range, reach and ears on ground, helped BSLI cover more than 2 million lives since it commenced operations and establish a customer base spread across more than 1500 towns and cities in India. To ensure that our customers have an impeccable experience, BSLI has ensured that it has lowest outstanding claims ratio of 0.00% for FY 2008-09. Additionally, BSLI has the best Turn around Time according to LOMA on all claims Parameters. Such services are well supported by sound financials that the Company has. The AUM of BSLI stood at Rs. 8165 crs as on February 28, 2009, while as on March 31, 2009, the company has a robust capital base of Rs. 2000 crs.

Canara HSBC OBC Life

The shareholding pattern of the Joint Venture is as follows - Canara Bank holds 51% equity, HSBC Insurance (Asia Pacific) Holdings Ltd 26% and Oriental Bank of

32

Commerce 23%. The Venture has an initial paid up capital of INR 325 crores which will further increase in line with our expansion plans. The Company commenced business 16th of June, 2008 after receiving requisite approvals from the Insurance Regulatory Development Authority (IRDA). Canara HSBC Life has access to 4100 bank branches all over India.

DLF Pramerica Life

DLF Pramerica Life Insurance Company Ltd. (DPLI) is a joint venture between DLF Limited and Prudential International Insurance Holdings, Ltd. (referred to hereafter as "PIIH"). PIIH is a fully owned subsidiary of Prudential Financial, Inc. (referred to hereafter as "PFI"). The combination of the strength of the DLF brand and PFI's insurance expertise provide the strongest possible foundations for DPLI to succeed in the rapidly growing Indian life insurance market. DLF DLF Limited is one of the leading real estate companies in the world. It has a track record of over six decades of sustained growth, customer satisfaction, and innovation. DLF's primary business is development of residential, commercial and retail properties. DLF has a unique business model with earnings arising from development and rentals. DLF has entered into several strategic alliances with global industry leaders. Also, it has recently forayed into the infrastructure, SEZ, financial services and hotel businesses (www.dlf.in). PFI Pramerica is a tradename used by Prudential Financial, Inc. ("PFI"), a company incorporated and with its principal place of business in the United States, and its affiliated 33

companies in select countries outside the United States. PFI is a financial services leader with operations in the United States, Asia, Europe, and Latin America. Leveraging its heritage of life insurance and asset management expertise, PFI is focused on helping individual and institutional customers grow and protect their wealth. In the U.S., the company's Rock symbol is an icon of strength, stability, expertise and innovation that has stood the test of time. PFI's businesses offer a variety of products and services, including life insurance, annuities, retirement-related services, mutual funds, investment management, and real estate services. Prudential Financial, Inc. of the United States is not affiliated in any manner with Prudential plc, a company incorporated in the United Kingdom.

Future Generali Life

Future Generali is a joint venture between the India-based Future Group and the Italybased Generali Group. Future Generali is present in India in both the Life and Non-Life businesses as Future Generali India Life Insurance Co. Ltd. and Future Generali India Insurance Co. Ltd.

FUTURE GROUP Future Group, led by its founder and Group CEO, Mr. Kishore Biyani, is one of Indias leading business houses with multiple businesses spanning across the consumption space. While retail forms the core business activity of Future Group, group subsidiaries are present in consumer finance, capital, insurance, leisure and entertainment, brand development, retail real estate development, retail media and logistics. Led by its flagship enterprise, Pantaloon Retail, the group operates over 12 million square feet of retail space in 71 cities and towns and 65 rural locations across India. Headquartered in Mumbai (Bombay), Pantaloon Retail employs around 30,000 people 34

and is listed on the Indian stock exchanges. The company follows a multi-format retail strategy that captures almost the entire consumption basket of Indian customers. In the lifestyle segment, the group operates Pantaloons, a fashion retail chain and Central, a chain of seamless malls. In the value segment, its marquee brand, Big Bazaar is a hypermarket format that combines the look, touch and feel of Indian bazaars with the choice and convenience of modern retail. The groups specialty retail formats include sportswear retailer, Planet Sports, electronics retailer, eZone, home improvement chain, Home Town and rural retail chain, Aadhaar, among others. It also operates popular shopping portal, www.futurebazaar.com. Future Capital Holdings, the groups financial arm, provides investment advisory to assets worth over $1 billion that are being invested in consumer brands and companies, real estate, hotels and logistics. It also operates a consumer finance arm with branches in 150 locations. Other group companies include, Future Generali, the groups insurance venture in partnership with Italys Generali Group, Future Brands, a brand development and IPR company, Future Logistics, providing logistics and distribution solutions to group companies and business partners and Future Media, a retail media initiative. The groups presence in Leisure & Entertainment segment is led through, Mumbai-based listed company Galaxy Entertainment Limited. Galaxy leading leisure chains, Sports Bar and Bowling Co. and family entertainment centres, F123. Through its partner company, Blue Foods the group operates around 100 restaurants and food courts through brands like Bombay Blues, Spaghetti Kitchen, Noodle Bar, The Spoon, Copper Chimney and Gelato. Future Groups joint venture partners include, US-based stationery products retailers, Staples and Middle East-based Axiom Communications. Future Group believes in developing strong insights on Indian consumers and building businesses based on Indian 35

ideas, as espoused in the groups core value of Indianness. The groups corporate credo is, Rewrite rules, Retain values. THE GENERALI GROUP The Generali Group is a leading player in the global insurance and financial markets. Established in Trieste in 1831, today the Group is one of Europes largest insurance providers and the European biggest Life insurer. It is also one of the worlds top asset managers with assets totaling more than 300 billion. With an employed sales force of more than 100,000 people serving 60 million clients in 65 countries, the Group occupies a leadership position in Western Europe and an increasingly important place in Eastern Europe and Asia. The Group strategy aims to consolidate Generalis pre-eminence on its key markets and achieve a premier position on markets with high growth potential, establishing its leadership in profitability. The Group is not only the market leader in Italy, but also a primary player in Germany, France, Austria, Spain, Switzerland, Israel and Argentina. Generali is a strong player on markets offering high growth potential. In Central Eastern Europe, in particular, thanks to the Generali PPF Joint Venture, it is one of the primary players. Generali also has Joint Ventures in India and China, where, within a few years after its entrance, it has already become one of the top foreign insurance providers.

HDFC - Standard Life Insurance Company Ltd

HDFC Standard Life Insurance Company Limited. is one of India's leading private insurance companies, which offers a range of individual and group insurance solutions. It is a joint venture between Housing Development Finance Corporation Limited (HDFC Limited), India's leading housing finance institution and a Group Company of the Standard Life Plc, UK. As on February 28, 2009 HDFC Ltd. holds 72.43% and Standard Life (Mauritius Holding) 2006, Ltd. holds 26.00% of equity in the joint venture, while the rest is held by Others.

36

ICICI Prudential Life Insurance

ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank - one of India's foremost financial services companies-and Prudential plc - a leading international financial services group headquartered in the United Kingdom. Total capital infusion stands at Rs. 47.80 billion, with ICICI Bank holding a stake of 74% and Prudential plc holding 26%. We began our operations in December 2000 after receiving approval from Insurance Regulatory Development Authority (IRDA). Today, our nation-wide team comprises of 2074 branches (inclusive of 1,116 micro-offices), over 225,000 advisors; and 7 bancassurance partners. ICICI Prudential is the first life insurer in India to receive a National Insurer Financial Strength rating of AAA (Ind) from Fitch ratings. For three years in a row, ICICI Prudential has been voted as India's Most Trusted Private Life Insurer, by The Economic Times - AC Nielsen ORG Marg survey of 'Most Trusted Brands'. As we grow our distribution, product range and customer base, we continue to tirelessly uphold our commitment to deliver world-class financial solutions to customers all over India.

IDBI Fortis Life

IDBI Fortis Life Insurance Co Ltd, is a joint venture between three leading financial conglomerates Indias premier development and commercial bank, IDBI, Indias leading private sector bank, Federal Bank and Europes premier Bancassurer, Fortis, each of which enjoys a significant status in their respective business segments. In this venture, IDBI owns 48% equity while Federal Bank and Fortis own 26% equity each. IDBI Fortis launched its first set of products across India in March 2008, after receiving the requisite approvals from the Insurance Regulatory Development Authority (IRDA). Today, we offer our services through a vast nationwide network across the branches of IDBI Bank and Federal Bank in addition to a sizeable network of advisors and partners. 37

IDBI Bank Ltd. continues to be, since its inception, Indias premier industrial development bank. Created in 1956 to support Indias industrial backbone, IDBI Bank has since evolved into a powerhouse of industrial and retail finance. Today, it is amongst Indias foremost commercial banks, with a wide range of innovative products and services, serving retail and corporate customers in all corners of the country from over 620 branches and more than 1050 ATMs. The Bank offers its customers an extensive range of diversified services including project financing, term lending, working capital facilities, lease finance, venture capital, loan syndication, corporate advisory services and legal and technical advisory services to its corporate clients as well as mortgages and personal loans to its retail clients. As part of its development activities, IDBI Bank has been instrumental in sponsoring the development of key institutions involved in Indias financial sector such as the Securities and Exchange Board of India (SEBI), National Stock Exchange of India Limited (NSE) and National Securities Depository Ltd Federal Bank is one of Indias leading private sector banks, with a dominant presence in the state of Kerala. It has a strong network of over 640 branches and 670 ATMs spread across India. The bank provides over four million retail customers with a wide variety of financial products. Federal Bank is one of the first large Indian banks to have an entirely automated and interconnected branch network. The Bank operates on the core banking platform and is RTGS/ NEFT enabled through which it offers state-of-the-art technology enabled products and services. In addition to interconnected branches and ATMs, the Bank has a wide range of services like Internet Banking, Mobile Banking, Tele Banking, Any Where Banking, debit cards, online bill payment and call centre facilities to offer round the clock banking convenience to its customers. The Bank has been a pioneer in providing innovative technological solutions to its customers and the Bank has won several awards and recommendations. Fortis is an international insurance group composed of AG Insurance, the overall market leader in life and non-life insurance in Belgium, distributing its insurance products through the network of BNP Paribas Fortis Bank and independent insurance brokers, and 38

Fortis Insurance International with subsidiaries in the UK, France, Hong Kong, Luxembourg (Non-life), Germany, Turkey, Russia and Ukraine, and joint ventures in Luxembourg (Life), Portugal, China, Malaysia, Thailand and India.

ING Vysya Life

ING Vysya Life Insurance Company Private Limited (the Company) entered the private life insurance industry in India in September 2001, and in a short span of 3 years has established itself as a distinctive life insurance brand with an innovative, attractive and customer friendly product portfolio and a professional advisor force. It also distributes products in close cooperation with the ING Vysya Bank network. The Company is headquartered at Bangalore.

Kotak Life Insurance

Kotak Mahindra Old Mutual Life Insurance Ltd is a joint venture between Kotak Mahindra Bank Ltd., its affiliates and Old Mutual. A company that combines its international strengths and local advantages to offer its customers a wide range of innovative life insurance products, helping them in taking important financial decisions at every stage in life and stay financially independent. The company is one of the fastest growing insurance companies in India and has shown remarkable growth since its inception in 2001. Kotak Life Insurance employs around 5,565 people in its various businesses and has 197 branches across 141 cities. Old Mutual Old Mutual is an international savings and wealth management company based in the UK. Originating in South Africa in 1845, it is among the top 100 largest companies in the FTSE100. The group has a balanced portfolio of businesses offering Asset Management, Life Assurance, Banking and General Insurance Services in over 40 countries, with a focus on South Africa, Europe and the United States, and a growing 39

presence in Asia Pacific. Old Mutual employs approximately 54,000 employees worldwide with its primary listing on the London, secondary listing on the Johannesburg stock exchanges as well as in Namibia, Malawi and Zimbabwe.

Max New York Life

Max New York Life Insurance Company Ltd. is a joint venture between Max India Limited, one of India's leading multi-business corporations and New York Life International, the international arm of New York Life, a Fortune 100 company. The company has positioned itself on the quality platform. In line with its vision to be the most admired life insurance company in India, it has developed a strong corporate governance model based on the core values of excellence, honesty, knowledge, caring, integrity and teamwork. Incorporated in 2000, Max New York Life started commercial operation in April 2001. In line with its values of financial responsibility, Max New York Life has adopted prudent financial practices to ensure safety of policyholder's funds. The Company's paid up capital as on 30th April, 2009 is Rs 1782 crore. Max New York Life has multi-channel distribution spread across the country. Agency distribution is the primary channel complemented by partnership distribution, bancassurance, alliance marketing and dedicated distribution for emerging markets. The Company places a lot of emphasis on its selection process for agent advisors, which comprises four stages - screening, psychometric test, career seminar and final interview. The agent advisors are trained in-house to ensure optimal control on quality of training. The company currently has around 82,248 agent advisors at 715 offices across 389 cities. The company also has 36 referral tie-ups with banks, 24 partnership distribution and alliance marketing relationships each. Max New York Life has put in place a unique hub and spoke model of distribution to deepen our rural penetration. This is the first time such 40

a model has been put in place for rural marketing of insurance. The company has 139 offices dedicated to rural areas. Max New York Life offers a suite of flexible products. It now has 39 products covering both life and health insurance and 8 riders that can be customized to over 800 combinations enabling customers to choose the policy that best fits their need. Besides this, the company offers 6 products and 7 riders in group insurance business. The company currently has more than 11,178 employees.

Metlife India
MetLife India Insurance Company Limited (MetLife) is an affiliate of MetLife, Inc. and was incorporated as a joint venture between MetLife International Holdings, Inc., The Jammu and Kashmir Bank, M. Pallonji and Co. Private Limited and other private investors. MetLife is one of the fastest growing life insurance companies in the country. It serves its customers by offering a range of innovative products to individuals and group customers at more than 600 locations through its bank partners and company-owned offices. MetLife has more than 50,000 Financial Advisors, who help customers achieve peace of mind across the length and breadth of the country. MetLife, Inc., through its affiliates, reaches more than 70 million customers in the Americas, Asia Pacific and Europe. Affiliated companies, outside of India, include the number one life insurer in the United States (based on life insurance inforce), with over 140 years of experience and relationships with more than 90 of the top one hundred FORTUNE 500 companies. The MetLife companies offer life insurance, annuities, automobile and home insurance, retail banking and other financial services to individuals, as well as group insurance, reinsurance and retirement and savings products and services to corporations and other institutions.

Reliance Life Insurance

Reliance Life Insurance is an associate company of Reliance Capital Ltd., a part of Reliance - Anil Dhirubhai Ambani Group. Reliance Capital is one of Indias leading 41

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 - Anil Dhirubhai Ambani Group also has presence in Communications, Energy, Natural Resources, Media, Entertainment, Healthcare and Infrastructure.

Sahara Life
The Sahara Pariwars latest foray is in the field of Life Insurance. The Pariwars life insurance company Sahara India Life Insurance Company Ltd.- has been granted licence by the insurance regulator the IRDA on 6th February 2004. With this approval Sahara India Life Insurance Company Ltd. becomes the first wholly and purely Indian company, without any foreign collaboration to enter the Indian Life insurance market. The launch is with an initial paid up capital of 157 crores. The Chairman of the company is Shri Subrata Roy Sahara who is also the Chairman of Sahara Pariwar.

SBI Life insurance

SBI Life Insurance Company Limited is a joint venture between the State Bank of India and BNP Paribas Assurance. SBI Life Insurance is registered with an authorized capital of Rs 2000 crores and a Paid-up capital of Rs 1000 Crores. SBI owns 74% of the total capital and BNP Paribas Assurance the remaining 26%. State Bank of India enjoys the largest banking franchise in India. Along with its 6 Associate Banks, SBI Group has the unrivalled strength of over 16,000 branches across the country, arguably the largest in the world. BNP Paribas Assurance is the life and property & casualty insurance unit of BNP Paribas - Euro Zones leading Bank. BNP Paribas, part of the worlds top 6 group of banks by market value and a European leader in global banking and financial services, is one of the 42

oldest foreign banks with a presence in India dating back to 1860. BNP Paribas Assurance is the fourth largest life insurance company in France, and a worldwide leader in Creditor insurance products offering protection to over 50 million clients. BNP Paribas Assurance operates in 41 countries mainly through the bancassurance and partnership model. SBI Life has a unique multi-distribution model encompassing vibrant Bancassurance, Retail Agency, Institutional Alliances and Corporate Solutions distribution channels. SBI Life extensively leverages the SBI Group as a platform for cross-selling insurance products along with its numerous banking product packages such as housing loans and personal loans. SBIs access to over 100 million accounts across the country provides a vibrant base for insurance penetration across every region and economic strata in the country ensuring true financial inclusion. Agency Channel, comprising of the most productive force of more than 68,000 Insurance Advisors, offers door to door insurance solutions to customers.

Shriram Life
Shriram Life Insurance Company is the joint venture between the Shriram Group and the Sanlam Group. The Shriram Group is one of the largest and well-respected financial services conglomerates in India. The Group's main line of activities in financial services include chit fund, truck financing, consumer durable financing, stock broking, insurance broking and life insurance.The Group has a customer base of 30 lacs chit subscribers and investors and operates through a network of 630 offices all over the country. The Group has the largest agency force in the private sector consisting of more than 75,000 loyal and dedicated agents.

43

Sanlam Life Insurance Limited, a part of the Sanlam Group, is one of the largest providers of life insurance in South Africa with 3.2 million individual policies under administration. It has a significant presence across South Africa, United Kingdom and Namibia and is a major provider of life insurance, retirement annuities, saving and investment products, personal loans, home loans and trust services to individuals. The shareholder's funds of Sanlam Life equates to USD 4.4 billion. The Sanlam Group was established in 1918 and has a leadership position in financial services in South Africa. Demutualized in 1998, the group is listed on the JSE Securities Exchange in Johannesburg and on the Namibian Stock Exchange. It has a current market capitalization of USD 5.4 billion. The Sanlam Group also operates in the areas of group schemes, retirement funds, short-term insurance, asset management and other financial services. It has employee strength of 8,000 and has shareholder funds in excess of USD 4.6 billion. On 31st December 2004 it had more than USD 48 billion assets under management.

Star Union Dai-ichi Life

Bank of India and Union Bank of India, two leading Public Sector Banks in India and the Dai-ichi Mutual Life Insurance Company, a leading Japanese Company in the Life Insurance market, have floated a Joint Venture Company, "Star Union Dai-ichi Life Insurance Co. Ltd." for undertaking Life Insurance Business in India The Company, has been incorporated / registered with the Registrar of Companies, Maharashtra on 25th September, 2007. The Company has been issued the license for undertaking life insurance business in India by Insurance Regulatory and Development Authority (IRDA) on 26.12.2008. The Company has best insurance, IT, finance and investment resources to ensure that it soon earns a prominent position in insurance sector.

The Company has a capital stake of 51% by BOI, 26% by Dai-ichi Life and 23% by 44

Union Bank. The Company has authorized capital of Rs. 250.00 Crores. Star Union Dai-ichi Life, with the strength of the domestic partners in the Indian Financial Sector coupled with the Dai-ichi Lifes strong domain expertise is expected, to be a strong player in the Indian Life Insurance market in a short time. The Company offers various products to serve all strata of the society. Bank of India and Union Bank have a strong nationwide network of more than 5400 offices, which shall provide distribution outlets with a wide reach. More than 48 million strong banking customer base of the two banks provides ready scope for cross selling of insurance products. The two banks have strong brand equity, and command high level of trust among their customers and people at large. Additionally the Regional Rural Banks sponsored by the two banks provide more than 1400 branches to tap the life-insurance business in the rural areas.

Dai-ichi Life is a leading player in the Life Insurance Segment in Japan and is one of the top ten Life Insurers in the world and the second largest Life Insurance Company in Japan. Established in 1902, it has more than a century of experience in Life Insurance business. It has sound product knowledge, sharp asset management skills, and strong operational capabilities to manage Life Insurance business, which make Dai-ichi Life the best insurance JV partner on the domain side. Star Union Dai-ichi Life Insurance Company Ltd. is also committed to providing insurance to rural and weaker / social sectors. Both the domestic partners are in the process of implementing Govt. of Indias initiative of Financial Inclusion and their pan India network of branches gives the Company a natural edge in catering to these sectors effectively. With the strong brand and commitment of the partners, Star Union Dai-ichi Life Insurance Company Ltd. promises to be a new star on the horizon of the Indian life insurance business, promising value to all stakeholders.

45

Tata AIG
Tata AIG Life Insurance Company Limited (Tata AIG Life) is a joint venture company, formed by the Tata Group and American International Group, Inc. (AIG). Tata AIG Life combines the Tata Groups pre-eminent leadership position in India and AIGs global presence as one of the worlds leading international insurance and financial services organization. The Tata Group holds 74 per cent stake in the insurance venture with AIG holding the balance 26 per cent. Tata AIG Life provides insurance solutions to individuals and corporates. Tata AIG Life Insurance Company was licensed to operate in India on February 12, 2001 and started operations on April 1, 2001.

46

Chapter3
Research Methodology

47

Meaning of Research Redman and Mory define research as a systemized effort to gain new knowledge. Some people consider research as a movement, a movement from the known to the unknown. Research is an academic activity and as such the term should be used in a technical sense. According to Clifford Woody, research comprises defining and redefining problems, formulating hypothesis or suggested solutions; collecting, organizing and evaluating data; making deductions and reaching conclusions; and at last carefully testing the conclusions to determine whether they fit the formulating hypothesis.

Objectives of Research The purpose of research is to discover answers to questions through the application of scientific procedures. The main aim of research is to find out the truth which is hidden and which has not been discovered as yet. Though each research study has its own specific purpose but the research objectives can be listed into a number of broad categories, as following:1. To gain familiarity with a phenomenon or to achieve new insights into it. Studies with this object in view are termed as exploratory or formulative research studies. 2. To portray accurately the characteristics of a particular individual, situation or a group. Studies with this object in view are known as descriptive research studies. 3. To determine the frequency with which something occurs or with which it is associated with something else. Studies with this object in view are known as diagnostic research studies.

48

4. To test a hypothesis of a casual relationship between variables. Such studies are known as hypothesis-testing research studies.

2.3 Significance of Research All process is born of inquiry. Doubt is often better than overconfidence, for it leads to inquiry and inquiry leads to invention. Is a famous Hudson Maxim in context of which the significance of research can well be understood increased amounts of research make progress possible. Research inculcates scientific and inductive thinking and it promotes the development of logical habits of thinking and organization. The role of research in several fields of applied economics, whether related to business or to the economy as a whole, has greatly increased in modern times. The increasing complex nature of business and government has focused attention on the use of research in solving operational problems. Research, as an aid to economic policy, has gained added importance, both for government and business. Research methodology is a way to systematically solve the research problem. It may be understood as a science of studying how research is done scientifically. In it we study the various steps that are generally adopted by a researcher in studying his research problem along with the logic behind them. It is necessary for the researcher to know not only the research methods or techniques but also the methodology. Data Collection Source Information can be collected through both primary and secondary sources. The data collected for this project has been taken from the primary as well as secondary sources. Primary Data: In some cases the researchers may realize the need for collecting the first hand information. As in the case of everyday life, if we want to have first hand information or any happening or event, we either ask someone who knows about it or we 49

observe it ourselves, we do the both. Thus, the two methods by which primary data can be collected is observation and questionnaire. Secondary Data: Any data, which have been gathered earlier for some other purpose, are secondary data in the hands of researcher. Those data collected first hand, either by the researcher or by someone else, especially for the purpose of the study is known as primary data. Sources of secondary data are: Internet Magazines Publications Brochures

Objectives of the Project To determine the current status of the HDFC Standard Life Insurance Company Ltd. To find out the customers response towards HDFC Standard Life Insurance Company Ltd. To study the satisfaction level of customers in different attributes of HDFC Standard Life Insurance Company Ltd.

Research Design A research design is an arrangement of condition for the collection and analysis of data in a manner that aims to combine the relevance to the research purpose with economy in procedure.

50

In fact, the research design is the conceptual structure with in which research is conducted; it constitutes the blue print for the collection measurement and the analysis of the data. The research work which is undertaken is to get a detailed knowledge about the customers response towards HDFC Standard Life Insurance Company Ltd.

1. Qualitative research: this is through

Personnel manual Corporate website www.hdfc.com Graphical interpretation

2. Quantitative research
Design used: Exploratory

Sampling plan 1. Target Population: Employees of HDFC Standard Life in Rohini branch, New Delhi

2. Sampling Technique: Convenient sampling

3. Sample Size: 25

4. Research Tool Interview and questionnaire

51

Chapter4
Data Analysis

52

DATA ANALYSIS
Question No. 1 Respondent Age Group

RESPONDENT's AGE GROUP

14%

22% 18-30 30-45 45-60 60<

36% 28%

People within the age of 45 years to 60 years comprise of the maximum number of respondents i.e. 36% closely followed by people within the age of 30 years to 45 years i.e. 28%. Only 14% of respondents age was more than 60 years.

53

Question No. 2 Respondent income group (per year)

RESPONDENT's INCOME GROUP

23%

17% Below 50,000 50,000-1,00,000 1,00,000-2,00,000 >2,00,000

27%

33%

Respondents whose annual income lied between Rs. 50,000/- to Rs. 1,00,000/- comprised of 33% of the total people interviewed. While 17% respondents income lied below Rs. 50,000/-.

54

Question No. 3 Respondents Profession

RESPONDENT's PROFESSION

20%

22% Serviceman Businessmen Professionals Others

31%

27%

Of all the people interviewed, 31% of them were Professionals, 27% consisted of Businessmen, and 22% belonged to the Service Class and the rest 20% were of other categories.

55

Question No. 4 Are you aware about life insurance?

LIFE INSURANCE AWARENESS

37% Yes No 63%

Approximately 2/3rd of the people interviewed, were aware about the concept of life insurance. And the rest 1/3 rd were unaware about life insurance.

56

Question No. 5 Do you know about IRDA?

KNOWLEDGE ABOUT I.R.D.A.

29% Yes No 71%

A fairly better image emerged when people were questioned about IRDA. 71% people knew about it and the rest 29% didnt have the knowledge about IRDA.

57

Question No. 6 How many numbers of companies in life insurance are you aware of?

NO. OF COMPANIES IN LIFE INSURANCE SEGMENT

27%

18%

One Two-Four Four-Eight More than Eight

21%

34%

When asked numbers of companies in life insurance are you aware of 34% of people knew about more than 4 companies but less than 8 companies. And 27% people knew more than 8 companies. Whereas only 18% people knew just about one company.
58

Question No. 7 Do you know about HDFC STANDARD LIFE INSURANCE?

AWARENESS ABOUT HDFC STANDARD LIFE

33% Yes No 67%

Approximately 2/3rd of the people interviewed, were aware about HDFC Standard Life Insurance. And the rest 1/3 rd were unaware about HDFC Standard Life Insurance.

59

Question No. 8 What are the Sources of awareness of HDFC STANDARD LIFE INSURANCE?

SOURCES OF AWARENESS

31%

27%

23%

19%

Ads Friends Family Others

Cumulatively more than 40% people got awareness about HDFC Standard Life from Friends and Family. 27% came to know about it through the various advertising channels adopted by the company. And the rest 31% were aware through other sources.

60

Question No. 9 Do you have any life insurance policy in any company?

ANY LIFE INSURANCE POLICY

27% Yes No 73%

Close to 3/4th of the people have life insurance policy in one or the other insurance company. On the other hand, 27% people had no insurance policy in any of the insurance companies.

61

Question No. 10 Do you have any life insurance policy in HDFC STANDARD LIFE INSURANCE?

POLICY IN HDFC STANDARD LIFE

32%

Yes No

68%

Out of all the people questioned, 68% of them had a life insurance policy with HDFC Standard Life. Whereas the remaining 32% people had no life insurance policy with HDFC Standard Life Insurance.

62

Question No. 11 Which type of life insurance policy do you have?

TYPE OF POLICY PLAN

13%

23% Protection Plan Pension Plan

33% 31%

Investment Plan Savings Plan

Of all the people interviewed, 33% had investment plans with HDFC Standard Life Insurance, closely followed by Pension Plan at 31%. About 23% people had taken Protection Plans and remaining 13% opted for Savings Plans.

63

Question No. 12 Are you satisfied with HDFC STANDARD LIFE INSURANCE Plans?

SATISFACTION LEVELS

29%

12% 26% 33%

Dissatisfied Average Satisfied Highly Satisfied

When asked about the satisfaction with the insurance plans, 33% people were highly satisfied, 29% were satisfied. And only 12% people were dissatisfied by the plans offered by HDFC Standard Life Insurance.

64

Question No. 13 Are you satisfied with customer services given by the HDFC STANDARD LIFE INSURANCE?

SATISFACTION LEVELS WITH SERVICES PROVIDED

23%

7% Dissatisfied 33% Average Satisfied Highly Satisfied

37%

Satisfaction levels with the services provided by HDFC Standard Life Insurance were found to be satisfactory overall as 37% people were

65

satisfied, 23% people were highly satisfied and only 7% people were dissatisfied.

Question No. 14 Why do you invest in life insurance?

REASON TO INVEST IN LIFE INSURANCE

28%

22%

Risk Cover Investment Safe Future Returns

21%

29%

Tax Benefits

A mixed result came forward on this question as 29% people invested in life insurance to have investment option, 28% people invested to avail tax benefits. Only 22% people invested to have a security against risk cover.
66

Chapter5
Findings

67

FINDINGS
The awareness of IRDA is satisfactory. 71% of people know about the IRDA. The people who know about the IRDA, these are mostly professional like as Advocate, CA and serviceman. While interacting with people, I found that a sizable portion of market i.e. approx. 65% is aware of insurance sector. Till today people do not have a right concept about insurance sector, they relate it with death, besides as a security and investment for future etc. Although a big percentage of population is aware about the private insurance companies. Out of which only 67% are aware about an HDFC Standard Life Insurance company. The people who have the life insurance policy of any company their percentage is very high it is 73% and only 27% people dont have any type of insurance policy of any company. There are percentages of people who know about HDFC Standard Life is very high. More than 35% of the surveyed people have satisfied perception regarding HDFC Standard Life Insurance, while 30% have average perception.25% of the surveyed people have highly satisfied perception and 10% have dissatisfied perception.

68

Chapter6
Recommendations & Suggestions
69

RECOMMENDATIONS AND SUGGESTIONS

Followings are the recommendations and the suggestions not only for the HDFC Standard Life Insurance company but also for other private life insurance companies if the want to complete with public/government life insurance companies.

i.

Creating positive image:

Private companies should try their level best to create positive and favorable image in the minds of people i.e. in the minds of their target customers.

ii.

Concern towards customers:

Serious concern must be given to the customers as in todays scenario it regarded as Customer is a king. In formal words we can say that if can customers more loyal towards the company.

iii.

Agency holder must be well educated:

The Company should give agency to that person who is well educated and can convince the customer b handling his queries and doubts.

iv.

Co-operation with agents and branch managers:

The Company must full co-operate with branch managers and agents.

v.

Availability of branch offices:

There must be the branch offices in each20-30 Km. areas;

70

vi.

Efficient management:
The management appointed must be that much capable that it can control the whole team and improve the goodwill and image of the company.

vii.

Sales promotion and marketing:

The marketing department must be so aggressive that it can have a close watch on the competitors activities. Not only this but also it must take care of the need and wants of the customers also.

viii.

Incentive schemes and permanency in job:

There must be good incentive schemes to be designed as these can acts as good motivators for the agents. The scheme of permanent job placement must be introduce for those F.C. and agents who have shown extra ordinary performance.

ix.

Solution of Grievances:
There must regular meetings with the financial consultants and agents to motivate them and to solve grievances if there are any.

71

Chapter7
Limitations

72

LIMITATIONS
Although every effort has been in to collect the relevant information through the sources available, still some relevant information could not be gathered.

Busy Schedule of Concerned Executives: The concerned executives

were having very busy schedule because of which they were reluctant to give appointment.

Time: The time duration could not provide ample opportunity to study every
detail of the company.

Unawareness: Executives were unaware of many terms related to same while

asking to them.

Confidential Information: As the company on account of confidential

report has not disclosed some figures. Moreover, in some cases separate accounts of division are not separately maintained thereby, leading to restrictions in study.

Area of Research: The research will be conducted in a limited area. Respondents: The respondent will be limited so cannot be treated as a whole
population. The respondent may be biased.

Due to language problem it is possible that the respondents are not be able to understand the questionnaire and can cause misleading results.

73

Chapter8
Conclusion

74

CONCLUSION
The size of the market has grown and size of the insurable population in India is needed vast and the existing player has managed to cover amount one fourth of it. The opportunities before the players are therefore a plenty in terms of target audience. Life Insurance has today become a mainstay of any market economy since it offers plenty of scope for garnering large sums of money for long periods of time. A well regulated Life Insurance industry which moves with the times by offering its customers tailor made products to satisfy their financial needs is, therefore, essential if we desire to progress towards a worry free future. People used to buy Insurance for tax exemption but time has changed now, advertising has made the people understand the need of Life Insurance in their lives and people are taking initiatives to buy it. Urge of people to have Insurance and strong marketing can really make the industry reach the sky.

75

BIBLIOGRAPHY

BOOKS Dessler Gary, Human Resource Management, 3rd edition, 1997, Macmillan Publishing House Ltd. Pg 89-95. Bratton John, Human Resource Management, 1st edition, 2006, John H. Jackson Publisher Pg 74-80. C Grote Richard, Forced Ranking: Making Performance Management Work, 2005 edition. Pg 108-118

WEBSITES http://www.hdfc.com/About us/Profile.aspx www.google.co.in http://en.wikipedia.org http://www.hdfc.com/products.aspx http://www.hdfc.com/services.aspx

76

ANNEXURE
Questionnaire
Name: Gender: Address: __________________________________ Male Female __________________________________ __________________________________ __________________________________ Contact Number: (Mobile) (Office) _______________________ _______________________

Question No. 1 Respondents Age Group 18-30 45-60 30-45 60<

Question No. 2 Respondents Income Group (annually) Below 50,000 1,00,000-2,00,000 50,000-1,00,000 >2,00,000

77

Question No. 3 Respondents Profession Serviceman Professionals Question No. 4 Are you aware about Life Insurance? Yes Question No. 5 Do you know about IRDA? Yes Question No. 6 How many numbers of companies in life insurance are you aware of? 1 4-8 2-4 >8 No No Businessman Others

Question No. 7 Do you know about HDFC STANDARD LIFE INSURANCE? Yes Question No. 8 What are the Sources of awareness of HDFC STANDARD LIFE INSURANCE? Advertisement Family Question No. 9 Do you have any life insurance policy in any company? Yes No 78 Friend Others No

Question No. 10 Do you have any life insurance policy in HDFC STANDARD LIFE INSURANCE? Yes No

Question No. 11 Which type of life insurance policy do you have? Protection Plan Investment Plan Question No. 12 Are you satisfied with HDFC STANDARD LIFE INSURANCE Plans? Dissatisfied Satisfied Question No. 13 Are you satisfied with customer services given by the HDFC STANDARD LIFE INSURANCE? Dissatisfied Satisfied Question No. 14 Why do you invest in life insurance? For risk cover For investment For safe future return For tax benefits Remarks 79 Average Highly Satisfied Average Highly Satisfied Pension Plan Saving Plan

 .... Date-

PlaceSignature

Respondents

80