A

PROJECT REPORT ON
MARKETING MIX OF IDBI FEDRAL LIFE INSURANCE

Submitted in partial fulfillment of requirement of bachelor of business administration

(BBA) , Guru Jambeshwar University of Science & Technology, Hisar.
Under Guidance Of

Faculty Incharge

Submitted By

Mrs. Manpreet kaur

Honika Uppal

TrainingIncharge
Mr. Sachin Garg

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Table of Content

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ACKNOWLEDGMENT
I am greatly obliged to Mr Manas das, branch head IDBI federal life insurance for his
valuable guidance and unwavering support during our internship period to complete our
project. I am truly grateful to him for the timely completion of my project.

I would also take this opportunity to express my gratitude to Mr Sachin

Garg for his guidance provided in this field in which he is an expert.

I would also take this opportunity to thank my faculty guide Mrs.Manpreet

kaur of JIMSas without her encouragement as well as monitoring this
project would not have been possible.

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ABSTRACT
The insurance industry of India consists of 51 insurance companies of which 24 are in life
insurance business and 27 are non-life insurers. Among the life insurers, Life Insurance
Corporation (LIC) is the sole public sector company. Apart from that, among the non-life
insurers there are six public sector insurers. In addition to these, there is sole national reinsurer, namely, General Insurance Corporation of India. Other stakeholders in Indian
Insurance market include Agents (Individual and Corporate), Brokers, Surveyors and Third
Party Administrators servicing Health Insurance claims.Out of 27 non-life insurance
companies, 4 private sector insurers are registered to underwrite policies exclusively in
Health, Personal Accident and Travel insurance segments. They are Star Health and Allied
Insurance Company Ltd, Apollo Munich Health Insurance Company Ltd, Max Bupa Health
Insurance Company Ltd and Religare Health Insurance Company Ltd. There sre two more
specialized insurers belonging to public sector, namely, Export Credit Guarantee Corporation
of India for Credit Insurance and Agriculture Insurance Company Ltd for Crop
InsuranceInsurance penetration of India .
Market Share:

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IDBI Federal Life Insurance Co Ltd. is a joint-venture of IDBI Bank, India's premier
development and commercial bank, Federal Bank, one of India's leading private sector banks
and Ageas, a multinational insurance giant based out of Europe. In this venture, IDBI Bank
owns 48% equity while Federal Bank and Ageas own 26% equity each. Having started in
March 2008, in just five months of inception, IDBI Federal became one of the fastest
growing new insurance companies by garnering Rs.100 Cr in premiums. Through a
continuous process of innovation in product and service delivery IDBI Federal aims to
deliver world-class wealth management, protection and retirement solutions that provide
value and convenience to the Indian customer.

Objectives of the Internship:

1. Analysis of Customer Perception of the insurance industry.
2. To suggest marketing methodologies to increase business of IDBI-Federal Life Insurance.
3. To get hands on experience of doing sales for the company.

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EXECUTIVE SUMMARY

The insurance sector in India is still in its nascent stages. But the Indians are an extremely risk
averse race. Thus due to this only the government entities have a good presence and brand
recognition in India and the others have a difficult time carving a space out for themselves in the
market.
Since the industry is at its early ages even now hence its constantly changing and evolving. This
makes it mandatory for the new players to tow the line and at the same time constantly keep on
evolving itself to meet the needs of the consumers.
In this sector the visibility of the brand matters the most and is of utmost importance. Since,
insurance is the backup plan for more risky propositions like shares and stocks. Hence the
customers who want to go for these propositions too are extremely risk averse. Hence there has to
be products specifically for this segment. And then expand furthermore into other segments while
keeping their base customers with them.
Keeping in mind the same these paper was done to study the marketing mix of IDBI Federal life
insurance solely depending on the current marketing approaches and the expectation of the Indian
consumers in the insurance sector.

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INTRODUCTION
This industry thrives mostly on the desire of the individual to reduce the uncertainties of the future.
This uncertainty can vary regarding various issues starting from their life to commodities to their
childs future as well as their present income. In the current fiscal year the growth of BFSI i.e. the
banking financial and insurance sector hovering around 9% and the Gross Domestic Product growth
of the country at being around 4.7 % in the fiscal year 2013-2014 the industry is facing a hard time
as the lower growth means lower disposable income in the hands of the consumers. The increase in
the inflation index also hasnt helped the industry at any level. If anything it has made the returns
look less and less lucrative.
HISTORY OF INSURANCE

The history of Insurance in India is deep-rooted. Since the earliest times insurance has been
carried out in some form or the other. Insurance in India has developed overtime and has taken ideas
from other countries- England in particular.
The history of insurance is divided into three phases as follows:-

PHASE I Pre Liberalization

PHASE II Liberalization

PHASE III Post Liberalization

Phase I Pre- Liberalization

18181829

First Insurance company in 1818 the Oriental Life insurance company in Kolkata
(then Calcutta) was the first company to start a life insurance business in india.
However, the company failed in 1834. In 1829 the Madras Equitable had begun
transacting Life insurance business in Madras Presidency.

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1870

Following the enactment of the British Insurance act 1870, The last three decades of the
nineteenth century saw the creation of the Bombay Mutual, Oriental and Empire of India in
the Bombay Residency.

1912

The Indian Life Assurance Companies Act

1912 was the first statutory measure to
regulate Life Business.

1928

The Indian Insurance Companies act 1928 gave the Government the power to
collect statically information above both life and non life business transacted in
Indian by Indian and foreigner insurers, including provident insurance societies.

1938

To protect the interest of the insuring public, the earlier legislation was consolidated
and amended by the Insurance Act 1938 which gave the Government effective
control over the activities of insurers.

1950s

In the 1950s, competition in the insurance business was very high and there were
allegations of unfair trade practices. The government of India therefore decided to
nationalize insurance business.

1957

Formation of the General insurance Council (GI Council) : the GI council

represents the collective interests of the non-life insurance companies in India. The
council speaks out on issues of common interest, participates in discussions related
to policy formation, and acts as an advocate for high standards of customer service
in the insurance industry.

1972

The General Insurance Business (Nationalization) Act 1972 was passed. The
General insurance Corporation of India was formed in pursurance of Section
9(1) of GIBNA. It was incorporated on 22 November 1972 under the companies Act
1956 as a private company limited by shares.

PHASE II- Liberalization

__________________________________________________________________________
The start of reform
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The international payment crisis of the 1990s forced the Government to re-think its industrial
policies and regulations.

1993

Malhotra Committee: In 1993 the government set up a committee under chairmanship

of RN Malhotra, the former Governor of RBI, To make recommendation for the
reform of the insurance sector.

1999

Formation of IRDA: following the recommendations of the Malhotra committee

report, The Insurance regulatory and Development Authority was constituted as an
autonomous body in 1999 to regulate and develop the insurance industry. The IRDA
was incorporated as a statutory body in April 2000.

PHASE III Post Liberalization

Recommendations of Malhotra Committee, the insurance sector were opened to private companies.
Foreign companies were also allowed to participate in Indian Insurance market through joint
ventures with Indian Companies. Under current regulations for the foreign partner cannot hold more
than 26% stake in the joint venture.
The key objective of the IRDA includes the promotion of competition with a view to increasing
customer satisfaction through more consumer choice and lower premiums, while ensuring the
financial security of insurance market. The IRDA has the power to make regulations under section
114A of insurance Act 1938. Since 2000 it has introduced various regulations ranging from the
registration of companies for carrying on insurance business to the protection of policy holders
interest.

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INSURANCE- COMPANIES IN INDIA

1. Life Insurance Corporation of india
2. ICICI Prudential.
3. SBI Life Insurance company Limited
4. Reliance Life Insurance company Ltd.
5. Max new York Life Insurance
6. HDFC Standard Life
7. Tata AIG Life Insurance
8. Bajaj Allianz Life Insurance
9. Birla Sun life
10. Metlite India Life Insurance
11. ING Vyasa Life insurance
12. Kotak Life Insurance
13. Aviva Life Insurance
14. Bharti AXA life insurance
15. IDBI federal Life Insurance

LIST OF GENERAL INSURERS IN INDIA

1. Bajaj Allianz
2. ICICI Lombard
3. IFFCO Tokio
4. National Insurance Company
5. The New India Assurance Company
6. Oriental Insurance
7. Reliance General Insurance
8. Royal Sundaram Alliance
9. TATA AIG
10. United India Insurance
11. Cholamandalam
12. HDFC ERGO
13. Export Credit Guarantee
14. Agriculture Insurance Co
15. Star Health and allied Insurance
16. Apollo Munich health insurance
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17. Future General

18. Universal Sompo
19. Shriram general

LIC has around 70% share in the premium being filed while all the others put together has a share of
30 %.

This tremendous competitiveness of the industry has given rise to high differentiation of the
products and services. Innovation is the new buzzword. Companies are trying to innovate across the
product life cycle to retain that edge.
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Sponsors of IDBI Federal Life Insurance Co Ltd

IDBI Bank Ltd. is a Universal Bank with its operations driven by a Cutting edge core Banking IT
platform. The Bank offers personalized banking and financial solutions to its clients in the retail and
corporate banking arena through its large network of Branches and ATMs, spread across length and
breadth of India. They have also set up an overseas branch at Dubai and have plans to open
representative offices in various other parts of Globe.
IDBI Bank is the youngest, new generation, public sector universal bank that rides on a cutting edge
core banking Information technology platform. This enables the Bank to offer personalized banking
and financial solutions to its clients.
The Bank had an aggregate balance sheet size of Rs. 3, 22,769 crore and total business of Rs 4,
23,423 crore as on March 31, 2013. IDBI Bank's operations during the financial year ended March
31, 2013 resulted in a net profit of Rs. 1882 crore continues to be, since its inception, India's
premier industrial development bank. It came into being as on July 01, 1964 to support India's
industrial backbone. Today, it is amongst India's foremost Commercial banks, with a wide range of
innovative products and services, serving retail and corporate customers in all corners of the country
from 1201 branches and 2156 ATMs.
The Bank offers its customers an extensive range of diversified services including project finance,
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 India's financial
sector - National Stock Exchange of India Limited (NSE) and National Securities Depository Ltd,
SHCIL (Stock Holding Corporation of India Ltd), CARE (Credit Analysis and Research Ltd).
Federal Bank is one of India's leading private sector banks, with a dominant presence in the state of
Kerala. The history of Federal bank dates back to the pre-independence era. Though initially it was
known as the Travancore Federal Bank, it gradually transformed into a fully fledged bank under the
able leadership of its founder, Mr. KP Hormis. It has a strong network of over 1,142 branches and
1,312 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. In addition to interconnected branches and ATMs,
the Bank has a wide range of services like Internet Banking, Mobile Banking, Tele Banking, and
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.

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Ageas is an international insurance group with a heritage spanning more than 180 years. Ranked
among the top 20 insurance companies in Europe, Ageas has chosen to concentrate its business
activities in Europe and Asia, which together make up the largest share of the global insurance
market. These are grouped around four segments: Belgium, United Kingdom, Continental Europe
and Asia and served through a combination of wholly owned subsidiaries and partnerships with
strong financial institutions and key distributors around the world. Ageas operates successful
partnerships in Belgium, UK, Luxembourg, Italy, Portugal, Turkey, China, Malaysia, India and
Thailand and has subsidiaries in France, Hong Kong and UK.
Ageas is the market leader in Belgium for individual life and employee benefits, as well as a leading
non-life player through AG Insurance. In the UK, Ageas has a strong presence as the fourth largest
player in private car insurance and the over 50's market. Ageas employs more than 13,000 people
and has annual inflows of more than EUR 21 billion.

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MARKETING MIX FOR IDBI FEDERAL

BANK

Before embarking on the journey of understanding the marketing mix of IDBI bank it is imperative
for us to understand what a marketing mix is. It consists of the 4 Ps and STP. The 4Ps are the
product, price, place and promotion. The important fact to notice is that their importance is in their
chronological order in a decreasing way. The most important thing is the product.
The product is the most important of the 4Ps. The product has to be very good to capture the market
share.
Next important factor is the price. The pricing has always been a very important factor as far as
economists are concerned. There is that famous demand curve and the estimation that tells us the
quantity that will be sold depending on what the price that is being charged. But marketing is an
extension of the branch of economics. It states that it is not only price which decides the sales but
the value that a customer perceives that he will get from the product. In the mind of the customer it
has to be more than the price he has paid for the product.
Then the most important component of our marketing strategy is the place. The place has to be
appropriate. The famous example that has been quoted so frequently is that there is no point in
trying to sell summer wear in Alaska or Greenland or to an Eskimo to be more precise with. Thus it
is very important for us to understand the people or place where we are trying to sell our product.
Promotion is the last but certainly not the least most important factor.
Promotional event and campaigning helps us in reaching out to our target customer and convey our
value proposition. This is the way companies communicate with their target customer and hence is
extremely important for their sale purpose.

SEGMENTATION, TARGETING AND POSITIONING

In segmentation we decide which part of the population we want to have as our target customer and
whom we want to serve. This depends on generally four parameters, namely: Psychographic,
demographic, geographical and behavioural characteristics. All these characteristics generally the
classification of the population on the basis of their income, age, gender, attitudes, preferences, and
the place where they are reside. This in short decides the target segment of our customers.

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PRODUCTS THAT WERE INTRODUCED TO INTERNS

IDBI Federal Childsurance is a non-linked participating endowment plan that ensures childs future
financial needs are fulfilled. It is designed to give customer guaranteed annual payouts and aid the important
milestones in their childs life.
HOW DOES THIS PLAN WORK
1. Customer needs to decide the amount of guaranteed annual payouts he would need which will depend on
plans for his childs future.
2. Basis the amount of payouts, he would then choose the Maturity Sum Assured (MSA).
3. Next, he would choose when and for how long he would need the payouts the difference between
childs current age and the age at which the guaranteed annual payouts should end, will be the policy
term. This can help plan his childs future better.

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The tagline for this product is that your kid might look cute while being angry now but he wont look so
when hes 18.It makes us think regarding the way we plan our future.The best example is that in todays date
a marriage might cost you around 5 lakh but after 18 years the same marriage is going to cost 33 lakh Indian
rupees. So, people have to keep in mind the inflation and cannot plan keeping the present value of things in
mind. This product takes care of the above fact and hence the future planning efforts are unaffected by
unforeseen and unfortunate events.

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IDBI Federal Wealthsurance Suvidha Growth

Insurance Plan is a simple unit linked plan that
helps customer take their first step towards wealth
creation and that too, with ease. Whats more, the
life cover with this plan provides financial
protection for loved ones.
Wealthsurance Plans guarantees following:
Financial protection against uncertainty
Partial withdrawals for emergency fund requirements
Guaranteed loyalty additions to boost your wealth
Flexible to switch funds and investment options
Option to choose how long you want to stay invested
Get 2 Tax benefit of 80 C and 10(10 D).

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IDBI Federal Incomesurance Guaranteed Money Back Insurance Plan is a non-linked non-participating
money back plan which gives customer guaranteed* returns on investment, so that they stop worrying about
the future. With Incomesurance, customer can guarantee a secure future for their family even when they are
not around.
HOW DOES THIS PLAN WORK
Incomesurance is a simple plan with guaranteed benefits. On payment of premiums for 5 years customer
will receive guaranteed annual payouts at the end of every year for the next 5 years. At the time of
purchasing the policy, he will know exactly how much he will receive as guaranteed annual payouts. The
guaranteed annual payouts that will be received will depend on two factors - the amount of annual premium
that he will pay and age.

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IDBI Federal Lifesurance savings insurance plan is a fixed term non-linked participating plan that provides
twin benefits of long-term savings and life cover.
With Lifesurance Savings, small savings will help customer realize the big dreams that he has for himself
and his family. This plan also offers the benefit of life cover that will provide financial security to family in
his absence.

BENEFITS OF THIS PLAN

Financial protection against uncertainty

Lump sum payout at maturity
Guaranteed additions to safeguard as per your need
Flexible to choose options as per your need
Bonuses to boost your savings
Get 2 Tax benefit of 80C and 10(10D)

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PRICING AND CALCULATING THE PREMIUM

Pricing refers to the calculation of premium that will be charged on the insurance policy.
The pricing of the insurance policy is an important decision for the insurance company and it will
have a number of prime objectives in mind in this respect.
In addition to being corned about charging premiums that are sufficient to meet claims, expenses
and produce profits at the desired level, the company will also be keen to ensure that premiums are
competitive so that it does not lose business to other insurance companies in the mortality tables.

PRICING ELEMENTS
Mortality rates:
As mentioned already that insurers use mortality tables to help calculate the premium. These
tables also contain mortality rates, which in simple words can be defined as the probability
that a certain individual will die before their next birthday.

Loading:
All companies incur expenses in going about their business and insurance companies are no
different. The premium is the key source of income for an insurance company and so the
premium needs to convert the cost of meeting these expenses. The addition of these expenses
to the premium is called loading.

Income from investment of premium:

The premium that is collected by insurance companies for traditional plans are invested as
mandated in Insurance Act 1938. The profits they earn from their investment can help to
cover the insurance companys expenses and so can be taken into account while considering
the price.

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Benefits promised:
The pricing will depend upon the benefits promised by the company. The larger the benefits
offered by the insurance company, the higher the premium will need to be cover the cost of
providing that benefit.
With profit-policyholders pay a slightly higher premium for the benefit of sharing in the
bonuses and are generally rewarded well by bonus declaration.

Premium Plan Being Taken:

The policyholder can pay the premium in a number of ways:

Single premium plan

In this plan policy holder pays a single lump sum payment at the
inception of the policy. The premium amount should be sufficient to
meet the administrative and other expenses during the entire term of the
policy.

Level Premium Plan

In this type of plan policyholder pays the same amount of premium for
the entire duration of the policy. When pricing this sort of policy the
insurance company will need to allow the time value of money i.e. it
should be sufficient to meet future claims.

Flexible Premium Plan

Insurance companies also allow the policyholder to choose a flexible

premium payment plan, where the policyholder can pay the premium
amount at their convenience. They can choose whether they wish the
premium to remain the same over the term or to change the amount of
premium paid based on affordability.

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CALCULATING PREMIUM

The process of calculating the premium is as follows:

Calculate the risk premium

Based on risk premium, calculate the level premium

Deduct the expected interest on investments to calculate the net premium

Add the loadings

Arrive at the gross premium to be charged

Calculate the risk premium:

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The life insurance premiums collected by the insurance company are kept in a single pool, known as
the common fund or life fund. All the future claims on the company are settled using this common
fund. Therefore, the insurance company has to make sure that there is enough in the common fund
to meet those claims.
Determining the correct amount for the common fund is a difficult task, as no one can accurately
predict the future. However, as we have seen, using the statistics on death rates from previous years,
insurance companies can now estimate fairly accurately the probability of an individual dying
before their next birthday. This probability known as the mortality rate is used to calculate the
risk premium.
The risk premium is calculated using the mortality rates in the mortality table of the respective
insurance company. The formula is:
Risk Premium = Mortality Rate * Sum assured
The risk premium is the premium that has to be charged just to meet the claims of those who die
during the year.

Based on risk premium, calculate the level premium

With many life insurance policies the insurance company charges the same amount of premium for
the entire policy term: it cannot be changed. Therefore, the premium set will need to take into
consideration the future expenses and claims that the insurance company will have to pay. It will
also need to take into account the effects of ination, which means that the value of money
decreases over time, so the premium the policyholder pays now will not hold the same value in later
years. This means that the cost of ination will be borne by the insurance company in the later years
of the policy. Consequently, the premium will need to be set at a higher level than would appear to
be appropriate initially. The higher premium collected in the early years is put into a reserve by the
insurance company to meet the cost of future claims and expenses.

Calculate the net premium

The premium that is collected by the insurance companies for traditional plans is invested in
securities as mandated in the Insurance Act 1938. The insurance companies earn interest as income
from their investments. This interest earned is also considered for the premium calculation. The
actuaries make an estimate of the amount of interest that the investments are expected to earn.
Based on the estimate of these interest earnings the premium charge can be reduced.

Premium Interest Earnings = Net Premium

There are some important points to remember when thinking about how the premium is adjusted for
the interest earned on its investment:
The premium is invested, until it is required to pay claims;
For level premiums, the reserve funds are also invested; and
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 The interest expected to be earned also depends upon the term of the policy.

Add loadings
A further adjustment is made to the net premium in order to calculate the gross premium (the actual
premium that is paid by the policyholder). This adjustment is to take account of the expenses and
prot of the insurance company. This process is known as loading.
The following items are added in loading:
Administrative expenses, such as the cost of running the building, employees salaries, etc.
Medical expenses incurred for medical underwriting;
Processing fee;
Expenses involved in the renewal of the policy;
claim settlement expenses;
Prot margin; and
Bonus loading for with-prot policies

Arrive at gross premium to be charged

The type of policy whether it is a single premium plan, a level premium plan, exible premium
plan or an annually renewable plan will affect the gross premium to be charged. For instance,
when calculating the premium for a single premium plan the insurance company will need to
determine how many policyholders are likely to take up the plan and how many death claims it will
expect to have to pay during the policy term.
Similarly, whether the premium is to be paid annually, semi-annually, and quarterly or monthly will
also need to be taken into account. Most insurance companys rst calculate the premium for annual
payment, and then make a further adjustment for monthly payment. Insurance companies generally
collect a frequency loading if the premium is not being paid annually.

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PROMOTIOAL ACTIVITIES OF IDBI FEDERAL

Promotion is one of the four elements of marketing mix (product, price, promotion, and place). It is
the communication link between sellers and buyers for the purpose of influencing, informing, or
persuading a potential buyer's purchasing decision.
The following are two types of promotion:
1. Above the line promotion: Promotion in mass media (e.g. TV, radio, Newspapers, internet,
mobile phones) in which the advertiser pays an advertising agency to place the
advertisements.
2. Below the Line Promotion: Much of this is intended to be subtle enough for the consumer to
be unaware that promotion is taking place.
3. E.g., Sponsorship, testimonials, sales promotion, merchandising, direct mail, personal
selling, PR, trade shows
The specification of five elements creates a promotional mix or promotional plan. These elements
are personal selling, advertising, sales promotion, direct marketing and publicity. A promotional mix
specifies how much attention to pay to each of the five subcategories, and how much money to
budget for each. A promotional plan can have a wide range of objectives, including: sales increases,
new product acceptance, creation of brand equity positioning, competitive retaliations, or creation of
a corporate image fundamentally, however there are three basic objectives of promotion.
These are:
1. To present information to consumers as well as others
2. To increase demand
3. To differentiate a product.
Here we have to find out:
how effectively advertisements influence a person to buy the life insurance products
The find whether IDBI federal needs brand ambassador to reach the customer effectively
Identifying the role of advertisements for life insurance products
Following are the main ways in which IDBI Federal life Insurance company ltd promotes its
products/services and creates awareness in the market.
NEWSPAPER:
IDBI Federal has attained notice through many articles and advertisements published in various
national and regional newspapers in India like the Economic Times, Times of India, The Hindu ,
Samachar Jagat, Vir Arjun, Meghalaya Guardian etc. IDBI Federal spends around Rs 1040 per
sq.cm for promotional activities through newspapers. They position the ads and articles in such a
way that it catches the eye of the reader as soon as they start reading the newspaper.
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HOARDINGS:
IDBI Federal has also tried making their potential customer aware of their products and policies
through billboards and hoardings by positioning them in strategic locations. As of now, the total
number of hoardings which are put up in Hyderabad region counts to a good 17 number. The total
expenses spent by the company for this promotional activity is Rs 4 Lakh.
PAMPHLETS:
Pamphlets are distributed across India at least 5 times in a month without any cost. Its done to
create maximum awareness about the products/services.
MAGAZINES:
There is no specific magazine in which advertisement is given. Its given in magazines depending
upon their sales and reputed magazines like Outlook, Money etc. The advertisement is given every
month at least once in any magazine.
TELEVISION:
Mainly, the advertisement is shown on cricket channels, Star channels. The main promotions were
done during FEB & MARCH to:
1. Highlight the tax benefit
2. To combat competition as all the insurance companies would advertise during this time at a
great frequency. Also the company will soon start displaying their advertisements on Satellite
TV like SUN network, etc.
DISTRIBUTORS:
A strong network of distributors and parent advisors also helps a lot in promoting products/services
of IDBI Federal by word of mouth. A Viral campaign is also run on the Internet by wherein flash
videos of working of products are explained in a very humorous manner.
LOCAL EVENTS:
The overall costs associated with such events totals to Rs. 2, 00,000 per annum such events are
mainly conducted in Apartments, Schools, etc. Building an engagement process around the solution
being offered gives an additional boost to this cause. Spelling Bee was a specially created spelling
contest created to connect with children. The engagement started with the spelling contest for kids
and gave natural opening for a discussion with parents about financial planning for their childrens
future needs like education. This is a sort of channel marketing which IDBI Federal had adopted to
create awareness as well as to educate the future generation about the company and the importance
of saving.
Also IDBI Federal involved them in developing their business by joining hands with SAMHITA, a
community development organization based out of Bhopal which works towards bringing financial
literacy to the underprivileged population in Madhya Pradesh. They believe that such financial
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literacy among the under banked population will help bring a holistic change in the way people
perceive and understand financial products and their utility at various stages in their life.
This will ultimately help bring them closer to financial inclusion.

CLIENT NEEDS
As we have established, it is the responsibility of the insurance agent to determine the legitimate
needs of their clients, priorities them and then to recommend suitable insurance or savings products.
The process involves the following steps:

Identifying needs Quantifying needs Prioritizing needs

1. Identifying needs: An insurance agent needs to collect and analyse the following information:
Details of the client in terms of their nancial assets and liabilities;
Marital status;
Future nancial goals of the client for themselves and their children;
Number and age of dependants;
Employment status, i.e. their existing grade and scope of promotion within their company;
Income which includes salary, business income and income from other sources and investments
(if any);
Details of health status and heredity medical conditions; and
Existing protection, savings and retirement provision (if any).

2. Quantifying needs: in the nancial planning process an insurance agent needs to quantify each
of the needs in monetary-terms and then calculate suitable amounts that an individual needs to save
and invest for the future.

3. Prioritizing needs: the amount available for investment is the clients income less their living
and other expenses, i.e. the monthly surplus available. The clients needs must be prioritized, as
their investment capacity may be limited and the total amount to be spent may be more than the
surplus funds available.

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The insurance agent should suggest the best product mix, where limited funds can be allocated to
full fill the maximum needs of the client. Prioritizing these needs helps the client to determine
which investment(s) can be deferred, and so the needs which are given highest priority in the
ranking are the ones for which investment should be made rst.
Client needs: real and perceived
It is important to understand that there are differences between real and perceived needs. Real needs
are the actual needs of a client which should take priority over others, whereas perceived needs are
imagined or thought to be important by the client (for example wanting to buy an expensive car
when there is adequate public transport and the client has insufficient savings or income to buy
one).
Real needs are determined by the use of nancial planning techniques and analysis. Perceived needs
can be understood by analyzing an individuals thoughts and desires. Lets have a look at some of
the problems faced by agents in advising clients about real and perceived needs:
Different nancial needs occur at different stages of the lifecycle of an individual. However, when
the time comes for nancial planning, an investor might shy away from actually making
investments. A young man might aspire to have Rs. 10, 00,000 ten years from now, but for this he
needs to sacrice some of his leisure activities and save and invest regularly.
The second problem is that clients often fail to understand the importance of saving for the future
and do not appreciate the benets that this will bring. They will want to give priority to their present
needs as opposed to their future intangible needs.
Individuals may not understand their real needs and may fail to priorities them sensibly. There can
be cases where an individual might choose to invest in child plans rst, whereas their priority need
would be to provide nancial protection for their family in the event of their premature death, illness
or disability.
The job of an insurance agent is to help clients in identifying real needs:

Identication of real
needs

Insurance agents should help their clients in understanding

their real needs. This can be done by educating them about
the concept and importance of insurance.

Identication of current
and future needs

Insurance agents should help their clients in understanding their

current and future needs.

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Quantication and
prioritization of needs

Once the needs are identified, they must be quantified in terms of

monetary value and prioritized.

Financial planning
review

Clients should meet with their agents regularly to review whether

their financial planning needs have changed over time. If so, then
new investments should be made to suit the changed
circumstances.

BENEFITS OF THE PROJECT TO THE COMPANY

Half of the work is simply done by knowing what the problem is at hand and by knowing the
weakness. By keeping them in mind the operations and the marketing efforts can be streamlined by
customizing them according the needs of target customer.
It is a well known fact that one size doesnt fit all. Before approaching a customer it is always a
good idea to know the needs of the customer before approaching them. This project tries to point out
the shortcomings and modifications in their marketing approach.

Problems Formulation
To increase the brand awareness about the company. To do the need analysis of the customer
To design the marketing mix in such a that the education of the common public happens regarding
the financial instrument ,Increase the financial education ,Increase transparency and increase the
trust quotient. The increase in this awareness might lead to increase in customer base. The
economies of scale can be achieved by tapping into the base of wary customers.
Therefore, the objectives of the company as of now should be
1. More differentiation of the product
2. To identify target segments more appropriately
3. To have customized strategies for every segment
So the major challenges right now in front of IDBI are what the general attitude towards various
segments is and how to increase the brand awareness of IDBI.

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RESEARCH METHODOLOGY

Data approaches
Sample size

Questionnaire.

100

Sample procedure :

Convenience sampling.

Research Design

Descriptive.

Research design: Research design is simply the framework or plan for a study, Used guide in collecting
and analysing data.
For the study: for conducting that research I selected the Descriptive research design.

Descriptive research design: Descriptive research is also called Statistical Research. The main goal of this
type of research is to describe the data and characteristics about what is being studied. The idea behind this
type of research is to study frequencies, averages, and other statistical calculations. Although this research is
highly accurate, it does not gather the causes behind a situation. Descriptive research is mainly done when a
researcher wants to gain a better understanding of a topic. That is, analysis of the past as opposed to the
future.
Descriptive research is the exploration of the existing certain phenomena. The details of the facts wont be
known. The existing phenomenas facts are not known to the persons.

Data Requirement Analysis:

The data required is about the investment pattern of the respondents, the income level under which they fall,
the respondents current status of having any insurance policy, their awareness level if IDBI Federal and
their likeness to invest in IDBI Federal.

Data Collection:
The data is collected through primary and secondary research. The data is collected through primary
research by doing field Survey in Delhi/NCR region and secondary research through text books, websites,
previous studies etc. The scope of research is restricted to Delhi/NCR region and the research approach
descriptive method.
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DATA SOURCE

Primary Data - Interviews, Group Discussions, and Structured questionnaires is been used to collect
Primary information on customers and marketers.

Seconday Data Is collected from Business Magazines, Manual of advertisements, Websites, Official
Publication, Industry market report, Local and International Newspapers, Articles, Journals, Brochures and
Books.

Questionnaire Design Formulation

The objective behind every question is know the preferences and psychic of very customer. To evaluate the
attitude of consumers whether they believe that the information provided to them of various products
through internet is sufficient and accurate. To analyze whether they are finding new and improved modern
ways to shop through internet is time saving or difficult over traditional ways of shopping.

Sample Design
Sample unit
Extent - The samples for the survey will be collected from New Delhi
Sampling Frame Sampling Technique - Random Sampling procedure is used.
Sample Size - The size of the sample will be about 50 comprising respondents of different socioeconomic profile (Age/ Gender/ Occupation/ Income Level/ Rural or Urban/ Education Level).

LIMITATIONS OF THE RESAERCH

The sample size though carried out amongst various age-groups has been limited to around 65.
The data collected is limited to the year 2014-15.

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DATA ANALYSIS & INTERPRETATION

Q-1 Which of the following long-term savings you are aware of ?

a) Life Insurance
b) Mutual Funds
c) Fixed Deposits
d) Securities
e) Post Office Savings
Long term saving

%age share

Life Insurance

28

Mutual Fund

12

Fixed Deposit

35

Securities

10

Post Savings

15

Long term savings

Life insurance

post office

mutual funds

fixed deposits

securities

10%
28%

35%
15%
12%

CONCLUSION
As we can see maximum sample is intrested in saving in fixed deposits with 35% share of sample .

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Q-2 Do you have investment/ insurance plan on your name?(Yes/No)__________

Investment plan

%age share

Yes

48

No

52

investment plans
yes

52%

No

48%

CONCLUSION
As 52% of sample has not invested in life insurance plans .

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Q-3 If the answer to the above question is Yes, please mention the details of the insurance policy
Term: _____ Maturity year: ____ Premium: _____ Insurance coverage amount: _____________
TERM

PREMIUM

INSURANCE
COVERAGE

%AGE SHARE

0-5 yr

10000-20000 p.a.

1 lakh

40

5-10 yr

20000-40000 p.a.

4 lakh

18

10-15 yr

40000-60000 p.a.

9 lakh

22

15-20 yr

60000-80000 p.a.

16 lakh

Above 20- yr

Above 1 lakh p.a.

Above 16 lakh

12

Term
0-5 yr

5-10 yr

10-15 yr

15-20yr

Above 20 yr

12%
8%

40%

22%
18%

CONCLUSION
As we can see maximum people invest for period of 0-5 years .

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Q-4 From which source did you come to know about life insurance?
a)Newspapers & magzines
b) Radio
c)Internet
d)Tele-marketing
Others,specify_______________________

Sources

%age Share

Newspaper & Magzines

12

Radio

28

Internet

44

Tele-Marketing

14

Others,specify

source
Radio

Tele-marketing

Internet

12%

Newspapers

Others

2% 12%

29%
45%

CONCLUSION
As maximum sample get awarness about the life insurance product through internet with 45%.

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Q-5 In which company you would like to purchase investment plan?

a) Goverment owned company public ltd.
b) Private company
c) Foreign company

Companys

%age share

Government owned co.

60

Private co.

22

Foreign co.

18

company
govt.co.

private co.

foreign co.

18%

22%

60%

CONCLUSION
As per sample ,60% sample want to purchase insurance in government owned public co.

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Q-6 Provide the reason behind choosing particular investment company?

a) Safety
Reasons for Investment

b)

%age Share

Safety

25

Brand Name

25

Good Track

17

Good Return

33

Brand Name
c) Good Track
d)Good Return

Reasons for investment

Safety

Brand name

Good track

Good return

25%

33%

17%

25%

CONCLUSION
As per sample most people want good return with safety and brand name are also important aspect while
reasons for investment.

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Q-7 How important would it be you to make a right choice of brand?

a)Not at all
Choice of making brand

%age share

Not at all Important

27

Equally Important

45

Very Important

28

b)Equally important
c) very important

choice of brand
not important

equally important

very important

27%

28%

45%

CONCLUSION
As maximum sample feel right brand plays equal importance in selecting life insurance.

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Q-8 Are you aware with the new unit link plane in the market?
a)Yes
b)No
Ulip plan
Yes

% age share
69

No

31

ULIP PLAN
yes

no

31%

69%

CONCLUSION
As per sample 69% people know about the unit linked insurance plans

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Q-10 How do you made your purchase decision for life insurance product ?
a)Consult other people to help choose best alternative available
b)Try to buy the same brand that my friends/colleagues have bought
c)Base my decision on the brand value of the company & product

Purchase decision influencing factors

Consult others to choose better
Try to buy the same brand that friends have
bought
Base my decision on brand value

%age share
33
45
22

Factors influencing purchase decision

consult others

try to buy same brand

22%

base on brand value

33%

45%

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RECOMMENDATIONS

It should target the target the rural rich populace first and should try and custumize service with
accordance to the needs of the poor .
Especially women should be their next target as the penetration in this segment is pretty low.
It should use banc assurance to its fullest use those banks which have a good rural penetration to
serve or sell its products.
If it can tie up with SBI then there would be more credibility to its products as people tend to have
more trust in the rural segment.
Extremely high class agents should be recruited as at the end of the day they are the brand
ambassadors for the organization.
Benchmarking the products against LIC and ICICI are going to bring in the best results.
Companies abroad have started big data in a big way to carry out analysis of which portions to
approach in a geographical location and how much to charge for premiums.
To create a pull approach rather than a push approach.
To make smokers and other people aware of the fact that even if they have an earlier ailment that
does not prevent them from having a health insurance.

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CONCLUSION
The right service model, a low cost platform, partnership with an Indian PSB, focus on
brand building, trust, good governance along with customized products for the ever
expanding client base in India will help them in carving out their own space.
Getting associated with Insurance industry which is fastest growing insurance company in
India.
Learning all the important points which affects the pricing and selling of companys product.
The high level of customer interaction and understanding the different behavior associated
with the client.

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REFERENCES

http://www.idbifederal.com/Pages/home.aspx
http://www.idbi.com/index.asp
http://en.wikipedia.org/wiki/IDBI_Federal_Life_Insurance
http://www.ageas.com/
http://www.idbifederal.com/Products/Pages/default.aspx

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