RESEARCH REPORT

Study of consumer perception in insurance industry

(2009-2011)

A REPORT SUBMITTED IN THE PARTIAL FULFILLMENT OF THE REQUIREMENTS OF

MASTER OF BUSINESS ADMINISTRATION

Under the Guidance of Mr. MUKESH SHRIVASTAVA (Faculty AIMT)

SESSION 2009-2011

Submitted By:
AMIT KUMAR MISRA

MBA IV Semester Roll No. 0936370008

Ambalika institute of Management & Technology Lucknow.

DECLARATION

I hereby declare that this research report on the Topic: Study of consumer perception in insurance

industry Is an original work done by me under the guidance of Mr.MUKESH SRIVASTAVA Faculty,
AMBALIKA INSTITUTE OF MANAGEMENT & TECHNOLOGY. This is submitted in fulfillment of Masters of Business Administration. I also hereby declare that this project report is not submitted anywhere else except this institute

AMIT KUMAR MISRA

MBA-4TH SEM

PREFACE
A professional course in business management is incomplete unless the theoretical knowledge acquired in the classroom is backed up by practical exposure as theories alone do not give perfection to any discipline. The gap between theory & practice is bridged by the summer training which has been made an integral part of the syllabus.
The intensification of completion the consumer durable company has brought the relevance of customer satisfaction as ever before them is no choice in the market of consumer service. But how the market bristles with a large number of competitor, the customer has become aware of the wider choice of alternative of service due to the main aim of preparing this project to the study of investors perception towards life insurance. Consumer perception is to know the make people aware about brand and here I have done the survey to know the investors perception towards life insurance.

.Perception is defined as the process by which an individual select, organizes and interpret stimuli into a meaningful and coherent picture of the world.

ACKNOWLEDGEMENT

The pleasure that follows the successful completion of an assignment would remain incomplete without a word of gratitude for the people without whose cooperation the achievement would have remained a distant dream. It is not a mere formality to place on record the tireless efforts, ceaseless cooperation, constant guidance and encouragement of the people closely associated with the assignment but a distinct necessity for the authenticity and credibility of the project.

The management theories learnt in a year are brought to practice. I tried to make best use of this opportunity. The work bears the imprint of many persons. My thanks go to Mr. Mukesh Shrivastava, my project guide and to all my faculty members in management department.

AMIT KUMAR MISRA

EXECUTIVE SUMMARY
Insurance, in law and economics, is a form of risk management primarily used to hedge against the risk of a contingent loss. Insurance is defined as the equitable transfer of the risk of a loss, from one entity to another, in exchange for a premium, and can be thought of as a guaranteed small loss to prevent a large, possibly devastating loss. An insurer is a company selling the insurance; an insured is the person or entity buying the insurance. The insurance landscape in India is in the process of tremendous change. Closed to foreign competition due to nationalization in 1956, the Indian insurance industry was run by the government for over 40 years through the life insurance and four general insurance companies that spanned the length and breadth of the country. While these companies had done a commendable job in helping the industry grow, the task of making an essential financial product available to the masses gave scope to several other companies to participate in this arena. Liberalization is in full swing in the Indian markets. Insurance industry being one of the most affected markets has experienced a plethora of new relationship in the last couple of years there are a few forces acting on the industry that have brought about significant changes in the behavior of the industry trends. Moreover there have been significant changes in the service outlook with respect to insurance industry. From the opinion that it was an instrument intended to provide monetary support at the time of the death of an individual, life insurance grew up to be a major financial instrument during the past 50 years in our country. There has also been a change in the consumer outlook with regards to life insurance as a very beneficiary financial tool as against the orthodox thinking of unfruitful use of money.

In view of the emerging nature of the market, there may be need for the players to go beyond mere efficiency in designing products. to understand the customers needs and to convey what they have to offer would perhaps bring in higher efficiencies in customer service. The following findings throw light on the service perspective bringing out the fundamentals of service marketing and its determinants. The finding of the research widens the consumer understanding aspect and it would be very helpful to imbibe customization.

Table of Contents
Introduction to the Industry (Insurance) 1.1 Introduction of Insurance 1.2 History of Insurance 1.3 Present Scenario of Insurance Sector 1.4 The Insurance Market 1.5 Insurance Regulatory & Development Authority 1.6 Types of Insurance 1.7 Industry Overview 1.8 Market Share of Different Companies 1.9 Major Players In Insurance Industry 1.10 Banks V/S Insurance 1.11 Importance of Insurance 1.12 Beginnings of Life Insurance 1.13 Kind Of Life Insurance Policies 1.14 Advantages of Life Insurance

2 Research Methodology
2.1 Title of the Study

2.2 Duration of the Project 2.3 Objective of Study

2.4 Type of Research 2.5 Sample Size and method of Selecting sample 2.6 Scope of Study 2.7 Limitation of Study 2.8 Facts and Findings 2.9 Statistical Analysis 2.10 Analysis and Interpretation 2.11 SWOT 2.12 Conclusion 2.12 Recommendation and Suggestions

Objective of Study
Project study which is being conducted by me for the Eight weeks is not only a formality for the fulfillment of the two year full time course of BACHLOR OF BUSINESS ADMINISTRATION But being a management student I tried my best to extract best of the information available in the market for the use of society and people. The professional objectives which are being covered by me in this project are as followingTo know the perception and conception of customers towards insurance products and specially focused for ICICI Prudentials product. To find the different way of convincing customers. To study brand image of the company in the market. To give suitable suggestions. To get the main findings based on questionnaire. To know awareness of consumer about ICICI Prudential. To increase the business of the Company To find satisfaction of consumer with ICICI Prudential. To know SWOT of company (strength, weakness, opportunity and threats).

Scope of the Study

Each and every project study along with its certain objectives also has scope for future. And this scope in future gives to new researches a new need to research a new project with a new scope. Scope of the study not only consist one or two future business plan but sometime it also gives idea about a new business which becomes much more profitable for the researches then the older one. Scope of the study could give the projected scenario for a new successful strategy with a proper implementation plan. Whatever scope I observed in my project are not exactly having all the features of the scope which I described above but also not lacking all the features. Research study could give an idea of network expansion for capturing more market and customer with better services and lower cost, with out compromising with quality. In future customer requirements could be added with the product and services for gettingan edge over competitors. Consumer behavior could also be used for the purpose of launching a new product with extra benefits which are required by customers for their account (saving or current) and/or for their investments. Factors which are responsible for the performance for company can also be used for the modification of the strategy and product for being more profitable. Factors which I observed while doing project study are followingCompetitors Customer Behavior Current Scenario Governmental Policy Economic condition

BRIEF HISTORY OF INSURANCE

The business of insurance started with marine business. Traders, who used to gather in the Lloyd's coffee house in London, agreed to share the losses to their goods while being carried by ships. The losses used to occur because of pirates who robbed on the high seas of because of bad weather spoiling the goods or sinking the ships. The first insurance policy was issued in 1583 in England. In India insurance began in 1870 with life Insurance being transacted by an English company, the European and the Albert. The first insurance company the Bombay Mutual Assurance Society Ltd. formed in 1870. The Oriental Life Assurance Co. in 1874 and the Empire of Indian of 1897 followed this. Later, the Hindustan Cooperative was formed in Calcutta, the United Nations in Madras, the Bombay Life in Bombay, the National in Calcutta, the New India in Bombay, and the A Jupiter in Bombay and the Lakshmi in the New Delhi. These were all Indian companies, started as a result of the Swadeshi movement in the early 1900's by the year 1956, when the life insurance business was nationalized and the Life Insurance Corporation of India (LIC) was formed on the Its September 1956, there were 170 companies and 75 provident fund societies transaction life insurance business in India. After amendments to the relevant law in 1999, the LIC did not have the exclusive privilege of doing life insurance business in India. By 31-3-2010, 11 new insurers had been registered and had begun to transact life insurance business in India. Insurance is a legal contact that protects people from the financial costs those results from loss of lift, loss of health, lawsuits, or property damage. Insurance provides a means for individual and society to cope up with some of the risks faced in every day life by every body. People purchase contracts of insurance, called a policy, from various insurance companies. Almost every person existing in this world is associated with insurance, directly or indirectly.

Directly, in the sense that he / she has insured his/her life by some kind of insurance policy from any company. Indirectly, in the sense they must have insured the assets of their won for example their house, car, or any thing else.

History of Insurance in India

Ancient Indian history has preserved the earliest traces of insurance in the form of marine rade loans or carriers contracts. These can be found in KaLIClya's Arthashastra, Yajnyavalkya's Dharmashastra and Manu's Smriti. These works show that the system of credit and the law of interest were well developed in India. They were based on a clear appreciation of the hazard involved and the means of safeguarding against it. The Indian Life Assurance Companies Act, 1972 as the first statutory measure to regulated life insurance business. Later in 1928, the Indian insurance companies act was enacted, to enable the govt. To collect statistical information about both life and non-life insurance business transacted in Indian-by-Indian and foreign insurers, including the provident insurance society. Comprehensive, arrangements were, however, brought into effect with the enactment of the insurance act, 1938.Efforts in this direction continued progressively and Act was amended in 1950, making for reaching charges, such as requirement of equity capital for companies carrying on life insurance business, stricter controls on investment of life insurance companies, ceiling on the expenses of management and agency commission etc. By 1956, 154 insurers, 16 non-Indian insurers and 75 provident societies were carrying on life insurance business of India. On 19th January 1956, the management of the entire life insurance business of 29 Indian insurers and provident insurance societies and the Indian life insurance business of 16 non-Indian insurance companies then is operating in India. Insurance Corporation came into existence. An ordinance was passed in 1968 to amend the insurance Act to regulate/ control nonlife insurance resulting in set up of GIC in 1973. Malhotra committee submitted its report in 1994 and recommended means to reintroduce an element of competition by with drawing the

exclusivity of LIC and GIC. In 1997, Insurance Regulatory Authority (IRA) was established which was later re-styled as IRDA in 1999.

PRESENT SCENARIO OF THE INSURANCE SECTOR

Liberalization commitments of the country to help in disciplining future economic policies will include the insurance reforms. When the world over, insurance, markets have been opened up, India cannot remain in isolation. Globalization is the new economic reality, which is here to stay, heralding a new era of insurance in India. With the opening of the insurance industry, India stands to gain the following major advantages: Globalization will provide improved opportunities to the customers for better products, with more reasonable and affordable pricing. The customer will get quicker servicing. It will enhance the savings rate. Long-term funds for infrastructure development will be available to the country. It will secure for India larger inflows of foreign capital needed to sustain our GDP growth.

THE INSURANCE MARKET

The term market is simply a term to describe the facilities for buying and selling As with any other market that for insurance consist of Buyers Sellers Intermediaries

THE BUYERS The buyers of the insurance or the insuring public include every one who requires insurance. Buyers can be divided into four sections. Firstly, there are private individuals who buy life insurance policies, household insurance on buildings, cars and scooters, personal liability and accident policies. Secondly, there are persons who buy industrial life assurance, which appeals to the wageearners (as distinct from the salaried class) or the lower income members of the community. Thirdly, there are buyers who seek insurance with Lloyds underwriters, through Lloyds brokers. Finally, the rest of the buyers comprise all persons, association, Firm joint stock companies, cooperation, societies, clubs, government, and under taking engaged in industry, trade and every other king of activity. THE SELLERS Then there are sellers of insurance who are known as insurers, and have huge overse as connections besides their home business. Insurers my be divided into several groups, according to their constitLICon. The principal groups are: Proprietary companies (Joint Stock Companies) Mutual insurers Cooperative Societies Lloyds underwriters Self-insurers Collecting friendly societies State insurance

INTERMEDIATE Like any other market, the intermediate bring the buyers& sellers together but it is possible to approach an insurance company directly & arrange insurance counter, except in case of Lloyds. Generally the business of insurance is sold by agent or middle man to call at then homes of the would be policy holders. The principle groups of intermediaries are Industrial life assurance agent insurance agent insurance broker Lloyds broker

Insurance Regulatory and Development Authority

Reforms in the Insurance sector were initiated with the passes of the IRDA Bill in Parliament in December 1999. The IRDA since its incorporation as a statutory body in April 2000 has fastidiously such to its schedule of framing regulations and registering the private sector insurance companies. The other d4ecisoin taken simultaneously to provide the supporting systems to the insurance sector and in particular the life insurance companies was the launch of the IRDA online service for issue and renewal of licenses to agents.

Types of insurance
Any risk that can be quantified can potentially be insured. Specific kinds of risk that may give rise to claims are known as "perils". An insurance policy will set out in detail which perils are covered by the policy and which are not. Below are (non-exhaustive) lists of the many different types of insurance that exist.A single policy may cover risks in one or more of the categories set out below. For example, auto insurance would typically cover both property risk (covering the risk of theft or damage to the car) and liability risk (covering legal claims from causing an accident). A homeowner's insurance policy in the U.S. typically includes property insurance covering damage to the home and the owner's belongings, liability insurance covering certain legal claims against the owner, and even a small amount of coverage for medical expenses of guests who are injured on the owner's property.

Business insurance
Can be any kind of insurance that protects businesses against risks. Some principal subtypesof business insurance are

(a) the various kinds of professional liability insurance, also calledprofessional indemnity insurance, which are discussed below under that name; and (b) the business owner's policy (BOP), which bundles into one policy many of the kinds of coverage that a business owner needs, in a way analogous to how homeowners insurance bundles the coverages that a homeowner needs.

Auto Insurance
Auto insurance protects you against financial loss if you have an accident. It is a contract between you and the insurance company. You agree to pay the premium and the insurance company agrees to pay your losses as defined in your policy. Auto insurance provides property, liability and medical coverage: Property coverage pays for damage to or theft of your car. Liability coverage pays for your legal responsibility to others for bodily injury or property damage. Medical coverage pays for the cost of treating injuries, rehabilitation and sometimes lost wages and funeral expenses. An auto insurance policy is comprised of six different kinds of coverage. Most countries require you to buy some, but not all, of these coverages. If you're financing a car, your lender may also have requirements. Most auto policies are for six

months to a year. Your insurance company should notify you by mail when its time to renew the policy and to pay your premium.

Home Insurance
Home insurance provides compensation for damage or destruction of a home from disasters. In some geographical areas, the standard insurances exclude certain types of disasters, such as flood and earthquakes that require additional coverage. Maintenance-related problems are the

homeowners' responsibility. The policy may include inventory, or this can be bought as a separate policy, especially for people who rent housing. In some countries, insurers offer a package which may include liability and legal responsibility for injuries and property damage caused by members of the household, including pets.

Health Insurance
Health insurance policies by the National Health Service in the United Kingdom (NHS) or other publicly-funded health programs will cover the cost of medical treatments. Dental insurance, like medical insurance, is coverage for individuals to protect them against dental costs. In the U.S., dental insurance is often part of an employer's benefits package, along with health insurance.

Disability Insurance
Disability insurance policies provide financial support in the event the policyholder is unable to work because of disabling illness or injury. It provides monthly support to help pay such obligations as mortgages and credit cards. Disability overhead insurance allows business owners to cover the overhead expenses of their business while they are unable to work. Total permanent disability insurance provides benefits when a person is permanently disabled and can no longer work in their profession, often taken as an adjunct to life insurance. Workers' compensation insurance replaces all or part of a worker's wages lost and accompanying medical expenses incurred because of a job-related injury.

Casualty Insurance
Casualty insurance insures against accidents, not necessarily tied to any specific property. Crime insurance is a form of casualty insurance that covers the policyholder against

losses arising from the criminal acts of third parties. For example, a company can obtain crime insurance to cover losses arising from theft or embezzlement. Political risk insurance is a form of casualty insurance that can be taken out by businesses with operations in countries in which there is a risk that revol LIC on or other political conditions will result in a loss.

Life Insurance
Life insurance provides a monetary benefit to a decedent's family or other designated beneficiary, and may specifically provide for income to an insured person's family, burial, funeral and other final expenses. Life insurance policies often allow the option of having the proceeds paid to the beneficiary either in a lump sum cash payment or an annuity. Annuities provide a stream of payments and are generally classified as insurance because they are issued by insurance companies and regulated as insurance and require the same kinds of actuarial and investment management expertise that life insurance requires. Annuities and pensions that pay a benefit for life are sometimes regarded as insurance against the possibility that a retiree will outlive his or her financial resources. In that sense, they are the complement of life insurance and, from an underwriting perspective, are the mirror image of life insurance. Certain life insurance contracts accumulate cash values, which may be taken by the insured if the policy is surrendered or which may be borrowed against. Some policies, such as annuities and endowment policies, are financial instruments to accumulate or liquidate wealth when it is needed. In many countries, such as the U.S. and the UK, the tax law provides that the interest on this cash value is not taxable under certain circumstances. This leads to widespread use of life insurance as a taxefficient method of saving as well as protection in the event of early death. In U.S., the tax on interest income on life insurance policies and annuities is generally deferred. However, in some

cases the benefit derived from tax deferral may be offset by a low return. This depends upon the insuring company, the type of policy and other variables (mortality, market return, etc.). Moreover, other income tax saving vehicles (e.g., IRAs, 401(k) plans, Roth IRAs) may be better alternatives for value accumulation. A combination of low-cost term life insurance and a higherreturn tax-efficient retirement account may achieve better investment return

Property Insurance
This tornado damage to an Illinois home would be considered an "Act of God" for insurance purposes Property insurance provides protection against risks to property, such as fire, theft or weather damage. This includes specialized forms of insurance such as fire insurance, flood insurance, earthquake insurance, home insurance, inland marine insurance or boiler insurance.

Automobile insurance
known in the UK as motor insurance, is probably the most common form of insurance and may cover both legal liability claims against the driver and loss of or damage to the insured's vehicle itself. Throughout the United States an auto insurance policy is required to legally operate a motor vehicle on public roads. In some jurisdictions, bodily injury compensation for automobile accident victims has been changed to a no-fault system, which reduces or eliminates the ability to sue for compensation but provides automatic eligibility for benefits. Credit card companies insure against damage on rented cars. Driving School Insurance insurance provides cover for any authorized driver whilst undergoing tuition; cover also unlike other motor policies provides

cover for instructor liability where both the pupil and driving instructor are equally liable in the event of a claim. Aviation insurance insures against hull, spares, deductibles, hull wear and liability risks. Boiler insurance (also known as boiler and machinery insurance or equipment breakdown insurance) insures against accidental physical damage to equipment or machinery. Builder's risk insurance insures against the risk of physical loss or damage to property during construction. Builder's risk insurance is typically written on an "all risk" basis covering damage due to any cause (including the negligence of the insured) not otherwise expressly excluded. Crop insurance "Farmers use crop insurance to reduce or manage various risks associated with growing crops. Such risks include crop loss or damage caused by weather, hail, drought, frost damage, insects, or disease, for instance."[ Earthquake insurance is a form of property insurance that pays the policyholder in the event of an earthquake that causes damage to the property. Most ordinary homeowners insurance policies do not cover earthquake damage. Most earthquake insurance policies feature a high deductible. Rates depend on location and the probability of an earthquake, as well as the construction of the home. A fidelity bond is a form of casualty insurance that covers policyholders for losses that they incur as a result of fraudulent acts by specified individuals. It usually insures a business for losses caused by the dishonest acts of its employees. Flood insurance protects against property loss due to flooding. Many insurers in the U.S. do not provide flood insurance in some portions of the country. In response to this,

the federal government created the National Flood Insurance Program which serves as the insurer of last resort. Home insurance or homeowners' insurance: See "Property insurance". Landlord insurance is specifically designed for people who own properties which they rent out. Most house insurance cover in the U.K will not be valid if the property is rented out therefore landlords must take out this specialist form of home insurance. Marine insurance and marine cargo insurance cover the loss or damage of ships at sea or on inland waterways, and of the cargo that may be on them. When the owner of the cargo and the carrier are separate corporations, marine cargo insurance typically compensates the owner of cargo for losses sustained from fire, shipwreck, etc., but excludes losses that can be recovered from the carrier or the carrier's insurance. Many marine insurance underwriters will include "time element" coverage in such policies, which extends the indemnity to cover loss of profit and other business expenses attributable to the delay caused by a covered loss. Surety bond insurance is a three party insurance guaranteeing the performance of the principal. Terrorism insurance provides protection against any loss or damage caused by terrorist activities. Volcano insurance is an insurance that covers volcano damage in Hawaii. Windstorm insurance is an insurance covering the damage that can be caused by hurricanes and tropical cyclones.

Credit Insurance
Credit insurance repays some or all of a loan when certain things happen to the borrower such as unemployment, disability, or death. Mortgage insurance insures the lender against default by the borrower. Mortgage insurance is a form of credit insurance, although the name credit insurance more often is used to refer to policies that cover other kinds of debt.

INDUSTRY OVERVIEW

LIFE INSURANCE BUSINESS NON-LIFE INSURANCE BUSINESS Life Insurance Corporation General Insurance Corporation ICICI Prudential Life Insurance National Insurance Company HDFC Standard Life Insurance The New India Assurance Company Max New York Life Insurance The Oriental Insurance Company United Birla Sun Life Insurance India Insurance Company Kotak Mahindra Life Insurance Reliance General Insurance Reliance Life Insurance TATA-AIG Insurance Allianz Bajaj Life Insurance Royal Sundaram Alliance

General Ins. Bajaj Allianz General Insurance ING Vyasa Life Insurance ICICI Lombard Insurance SBI Life Insurance

Market Share of Different companies Major Players in insurance industry LIFE INSURERS :
HDFC Standard Life Insurance Company Ltd. Max New York Life Insurance Co. Ltd. ICICI Prudential Life Insurance Company Ltd. Om Kotak Mahindra Life Insurance Co. Ltd. Birla Sun Life Insurance Company Ltd. Tata AIG Life Insurance Company Ltd. SBI Life Insurance Company Limited . ING Vysya Life Insurance Company Private Limited Allianz Bajaj Life Insurance Company Ltd. Metlife India Insurance Company Pvt. Ltd. AMP SANMAR Assurance Company Ltd. Dabur CGU Life Insurance Company Pvt. Ltd.

GENERAL INSURERS
Royal Sundaram Alliance Insurance Company Limited Royal Sundaram Alliance Insurance Company Limited IFFCO Tokio General Insurance Co. Ltd TATA AIG General Insurance Company Ltd. Bajaj Allianz General Insurance Company Limited ICICI Lombard General Insurance Company Limited.

LIFE INSURANCE CORPORATION

Life insurance made its debut in India well ob4er 100 years ago. Its salient features are not as widely understood in our county, as they ought to be. What follows is an attempt to acquaint readers with some of the concept of life insurance, with special reference to LIC. It should, however, be clearly understood that the following narration is by no means an exhaustive description of terms and conditions of LIC policy or its benefits or privileges. For more details, please contact our branch or divisional office. An LIC it will be glad to help you choose the life insurance plan to meet your needs and render policy servicing.

Banks v/s Insurance

BANKS INSURANCE Returns Low Better Administrative exp. High Low Risk Low ModerateInvestment options Less More Network High penetration Low but improving Liquidity At a cost Better Quality of assets Not transparent Transparent Interest calculation Minimum balance between 10th. & 30th. Of every month Everyday Guarantee Maximum Rs.1 lakh on deposits None

IMPORTANCE OF INSURANCE

If there is some one who would suffer economic hardship if you died, then the answer is yes............you need life insurance! Families with young children have a clear need of life insurance. If both spouses work, the loss of one income will cause the family immediate economic hardship and make it harder for them to realize future goals, such as paying for the children's education.But even if one spouse works 'inside the home' and doesn't being in a formal income, his or her death will require the surviving spouse to hire child care, housekeepers and other professional to help run the house hold and that can be a significant new expense.If you are married without children or single, then you may need life insurance to protect your partner or surviving family members against the costs associated with your death. Funeral expenses, probate and administrative fees, outstanding debts, special obligations to charities and federal and state taxes are costs that all of us must consider. And, they can add up quickly. Unless you already have sufficient financial resources, your survivors will probably need life insurance to cover these expenses. Along with your savings and investment strategy, life insurance should be a part of your long term financial planning. You may not like to think about it, but your death can be costly to your loved ones. At the very least, there will be funeral and burial costs.There may also be estate taxes and outstanding debts to pay, such as medical expenses not covered by

health insurance. If you have dependents, they will have to cope up with these costs while no longer having your income to rely on. The proceeds from a life insurance policy can be of tremendous value at this time.

THE BEGINNINGS OF LIFE INSURANCE

Life assurance can be traced back to the sixteenth century, when shot term assurance were usually affected as collateral security for loans, indeed, the first life assurance were marine insurance underwriters; policies often being written on the life of a merchant sailing with his goods. The first recorded life policy was in 1583, which was subject to an underwriters of England on June 18, 1583, for 12 months for $382.6s.8d. On the life of fine William Gigots. Through, the policy concluded with the words, God send the said William Gibbons health and life, he died on may 9, 1584. The underwriters contended that the policy period of 12 months related to lunar months, which had expired. But the court ruled out that payment must be made and the underwriter paid the sum assumed. Besides, in the sixteenth and seventeenth centuries, evidences of the existence of shot term policies are available, which cover the risk of death within a limited period only. They were particularly used for merchants and others on voyages or on the lives of debtors as security against loan. In the seventeenth and eighteenth centuries mutual assurance the Amicable Society, the Equitable Life Assurance Society and Westminster Society have and important place, Subsequently Life Assurance Act. 1774 and Life Assurance Companies Act, 1870 were passed to established the business. In India the first Insurance Act was passed in 1912, which was replaced by a

comprehensive Insurance Act of 1938 .This Act was amended in 1950. Finally, the Government of India nationalized the entire lifeinsurance business in the year 1956 by passing the life Insurance corporation Act, 1956. Thus at present the entire the insurance boniness in being transacted by the Life Insurance Corporation of India, which is popularly known as LIC. The Corporation is an autonomous body and run on sound business principles. Its central offices are located in Bombay and there are Zonal, Divisional, Branch and sub-offices both in India and aboard. Thus, we see that in last 2 years a large pool of private as well as other financial InstitLICon have come forward to provide this very service of insurance like ICICI PRUDENTIAL, BIRLA SUN LIFE INSURANCE, SBI LIFE INSURANCE, HDFC STANDARD LIFE INSURANCE etc. the share of private life insurance players has also increased marginally.

WHY LIFE INSURANCE? INSTRUMENT Safety Liquidity Post tax return Tax Efficiency Life Cover Provident Fund High Low Good Good None Shares Low Average Uncertain Low None

KVPs,NSCs High Low Average Low None Bonds,Fixed Deposits Average Average Low Low None Insurance Policy Average High Uncertain Average None Postal Saving Schemes High Low Average Average None LIFE INSURANCE HIGH LOW GOOD HIGH YES
KIND OF LIFE INSURANCE POLICIES Whole Life Policy Endowment policy Term Policy Annuity Policy WHOLE LIFE POLICY As the name suggests, whole life assurance policy lasts for the whole

of the assureds life, the sum being payable at death only. In other words, whole life insurance is a type of life insurance contract under which the policyholder is covered for his entire life. WHOLE LIFE POLICY IS Ordinary Whole Life Policy Limited payment Whole Life Policy Single Premium Whole Life Policy Special Whole Life Policy Convertible Whole Life Policy ENDOWMENT POLICY Endowment insurance is a type of life insurance contract, which provides for the sum assured to be paid wither at death or after a fixed number of years. Whichever comes first? The assured when affecting a policy selects the number of years. Thus, under this plan the company promises to pay a stated amount of money to the beneficiary at one. If the inured dies during the life of the policy (called the endowment period) or to the insured himself if he survives up to the end of the endowment period. I n other words, an endowment policy provides for the payment of the insured amo9unt either on death or on the attainment of a certain age, whichever is earlier. Suppose, a man takes an endowment policy for 20 years or even after a few weeks or days of taking lout the policy, the sum assured becomes payable to his dependents. As against this if he survives this periods, they policy matures and he will himself receive the payment of the sum assured on tehexpiry of 20 years. THE ENDOWMENT POLICIES ARE Ordinary Endowment policy

Pure Endowment policy Double Endowment policy Optional Endowment policy Anticipated Endowment policy Educational Endowment policy etc. TERM INSURANCE POLICY A term insurance policy is the oldest form of the policy. here the insurer makes the payments only if the insured dies within the the term of the policy of specified policy. In other words it is conflicts between the insured & the insurer whereby he company promise pay the face amount of the policy to a third party if the insured die before a certain or age however if insured doesnt die during the specified time the contract expired & is treated a cancelled the insurer pay nothing on the policy . thus , this contract run only for a temporary specified period of time & that a little or no cash value accumulated as saving or emergency fund for the policyholder . The policy may be written for assured a period of one year & may be issued for; longer period 5, 10, 20 years. This is plan of special interest to those who need extra protection for a short duration like businessmen on journey, for as temporary cover to secure as an outstanding debt. TERM INSURANCE POLICIES ARE Ordinary Policy Convertible Policy Decreasing Policy Renewable term Policy Yearly Renewable Policy

ADVANTAGES OF LIFE INSURANCE

1. It is superior to an ordinary saving plan: Unlike other saving plans, if affords full protection against risk of death. In case of death, the full sum assured is made available under a life assurance policy; whereas under saving scheme the total accumulated saving alone will be available. The later will be considerable less than the sum assured, if death occurs during early years. 2. Easy settlement & protection against creditors: The life assured can name person(s) called Nominee to whom the policy money would be payable in the event of his death. The proceeds of a life policy can be protected against the claim of the creditors of the life assured by effecting a valid assignment of the policy.

3. Ready marketability & suitability for quick borrowing: After an initial period, if the policyholder finds him unable to continue payment of premiums, he can surrender the policy for a cash sum. Alternatively, he can tide over a temporary difficulty by taking loan on the sole security of the policy without delay. Further, a life insurance policy is sometimes acceptable as security for a commercial loan. 4. Tax Relief: The Indian Income-Tax allows deduction of certain portion of the taxable income, which is diverted to payment of life insurance premiums from the total income tax liability. When this tax relief is taken into account, it will be found that the assured is in effect paying a lower premium for his insurance.

Process for Commission

Process -01 Download TR (Temporary Receipt) data from IDEAS in excel format. (Each company has an ARN (AMFI Registration number) (45888) so that it can download only its own data.) Pick all Complete & Closed & Deleted cases for process. All to be released cases hold by the company due to open in IDEAS. Data download are in encoding format. Decode all these cases & input all details in approved TR format (26 columns). Distribute TR data format wise. Process -02 Now the company has two data: 1. TR which is provided by State. 2. Company MIS (Online downloaded or Received with respective companies). Process -03 Matching both the data with either of the following parameters: Cover Note Policy Number Application no. Folio Number Investor Name

Cheque Number PAN Number Investment Amount etc. Respective Company Name Scheme Location Branch Agent Code Process-04 After matching if: Matched: Available for Payment Cancelled / Rejected: Cheque Bounce / Policy Cancelled Unmatched: Unmatched / Incomplete Process -05 Insurance Policy: KFC(Karvin, Franklin, CAMS) provide the facility to check the transaction status. Life Insurance: Shriram Life Insurance Company provides online access to check transaction status. General Insurance: Trying to get online access (under process). Process -06(01)

Still Unmatched data : Data send to respective state operations on weekly basis to provide additional/correct information. ACTION TO BE TAKEN BY STATE OPS Try to collect investment details like cheque number /cheque amount. Try to collect Vehicle number or RC number in case of GI. Try to Collect Pan no in case of MF. Process -06(02) STILL UNMATHCED DATA MF: Data send to Respective AMCs for provide status. GI: Data send to Respective GI companies. LI: Data send to SLIC. Output Not in SFLS business code. Provided information are Incomplete / Incorrect. Unable to trace with given details. Head Office role in this field For Communication between HO ops & state ops. Single point contact for all type of operations related queries like : Discrepancy in commission amount Correction required in cheques like agent name or cheque amount.

To reissue new cheques against missing/bounced or expired cheques(Cheque date old more than 6 months) For updating or correction in TR data like: Agency code Policy No./Cover note No./Application No./Folio No. Location/Branch/TR number/Cheque number. UPDATED TR MASTER Provide weekly basis to respective state operations /state heads/ Regional ops manager. To check the current status of TR. To provide the information about pending cases reasons(hold for agency code/investor name mismatched/agency name mismatched) To provide incomplete cases details which are not able to process due to information was wrong or incomplete.(where company reference number not mentioned)

Working of CAMS
In a complex processing environment, and where sub-agents of distributors have information needs, it becomes imperative for large distributors to provide efficient services to their constituents.CAMS offer a Distributors Service Package for distributors who operate through retail subagents and who have a retail investor base. The Scope of Distributor Services is listed below- Maintenance of Sub broker Master Details. Maintenance of Products Carried Master Details. Maintenance of Primary Brokerage Structures for receivable brokerage. Maintenance of Secondary Brokerage Structures for payable subbrokerage Maintenance of Investor Details. Creation and maintenance of Product Classes. Maintenance of transaction-specific or sub-broker-specific Financial Consultant (FC) Master Details. Import of daily transaction details of investors - Initial frequency weekly. Import of month-end front end brokerage payable received from issuers. Import of month-end net asset positions received from issuers. Import of monthend trailer fees payable received from issuers. Reconciliation of front-end brokerages as computed by issuers with those computed locally. Computation of sub-brokerage payable in respect of front-end commissions received. Computation of trailer fees payable to sub-brokers in respect of Net assets to their credit. Computation of incentives payable to sub-brokers in respect

of sales achieved. Computation of commission payable to Financial Consultants in respect of Sales effected with their assistance. Computation of commission payable to Financial Consultants in respect of Net Assets to their credit. Reporting the commissions payable to sub-brokers and Financial Consultants, the following Sales for the month by investor. Redemptions for the month by investor. Asset position movement by investor. Front-end commissions payable by transaction to sub-broker. Trailer Fees payable by transaction to sub-broker. Front-end commission payable by transaction to Financial Consultant. Trailer Fees payable by transaction to financial consultant. Target based Incentive Commissions payable to Sub-brokers. Target based Incentive Commissions payable to Financial Consultants.. Sub-brokers' Commission Accounts maintenance. Paying out the sub-brokerage payable to sub-brokers and Financial Consultants. Basic MIS Reports, the following Gross/Net Sales for a period by product class by sub-broker by city. Redemption for a period by product class by sub-brokers by city. Net Assets movement for a period by product class by sub-broker by city.

Historical performance of individual sub-brokers/FCs. Building in ability to view investors portfolio under one client number, subject to discussions with issuers. Building in ability to view investors as families or households, subject to discussion with issuers. All services are based on proprietary software products developed by their associate, M/s.Acsys Software, in association with leading Financial Distributors. Similarly Karvy & Franklin also provide such services to the Distributer companies.

About CAMS, Karvy, Franklinn

Insurance Policy is another saving or investment vehicle, akin to, but different from bank deposits, shares etc., It is an entity wherein people / institLICons pool small samounts of money into larger amounts for investment and achieve returns with minimum risk, which otherwise is not possible by a common man. There are 3 Registrars who records all the transactions of Insurance Policy in India. Providing timely and accurate information is their main obligation. They are as follows: 1. CAMS (Computer Age Management Services Pvt. Ltd ) 2. Karvy 3. Franklin 1. CAMS Computer Age Management Services Pvt. Ltd. (CAMS) offers a comprehensive package of Transaction Processing and Customer Care services to the Insurance Policy industry, and has been constantly raising the bar in customer service since1995. Set up in 1988 as an IT Services Company, CAMS moved from Capital Market Transaction Processing to Customer Care and Transaction Processing for Insurance Policy and then into Transaction Processing for Insurance. CAMS today has the most appropriate and advanced technology employed, with the best network for service processed in India, CAMS processes

50 or more. CAMS is clearly the delivery through its network of Service Centers in all major cities in India. Currently CAMS provides this comprehensive package of services to 18 Indian Insurance Policy families as services provider. Of every 100 Insurance Policy transactions

Research Methodology

Research Method Used

Marketing research is the function which likes the consumers, customers & public t the marketer through information which is used to identify & define marketing opportunities & problems, generate, refine & evaluate marketing action; monitor marketing performances & improve understanding of marketing as a process. TYPES OF MARKETING RESEARCH On the basis of fundamental objectives of the research, marketing research projects are classified into two branches: Exploratory Research Conclusive Research

EXPLORATORY RESEARCH
It seeks to discover new relationships. All marketing research projects start with it. This is a preliminary phase & is absolutely essential in order to obtain a proper definition of problems at hand. The major emphasis is on the discovery of ideas & insight. Exploratory research looks for hypothesis in well-established fields of study. Hypothesis Usually comes from ideas developed in previous researches or are delivered from theory. Hypothesis is tentative answer to the question that serves as guide for most of the research projects.

CONCLUSIVE RESEARCH

Conclusive research provides information that helps the execLICve so that he can make a rational decision. This study has done well while attempting to arrive at a more clear description of an apparent problem. In the initial stage, up to the final discussion of the questionnaire, we conducted our research through exploratory research. It includes the survey of related literature and articles, depth interview and public opinion through questionnaire. It focuses on the discovery of new ideas. For this type of research respondents should be given sufficient time express themselves. This type of research can be conducted to find out the possible causes like the sales might increase due to advisors efficiency.

Sample Design

In our project we prefer to go for Random Sampling. Random sampling is said to be a LOTTERY METHOD in which individual units are picked up from whole group not deliberately by some mechanical process. The result obtained from probability, we can measure the errors of estimation or the significance of results obtained from a random sample and their facts brings out the superiority design over the rest sampling design. The sample will have the same composition and characteristic as the universe.

Sample Frame: Different area of ALWAR

ON the basis of our survey in Alwar market, insurance is a growing industry & the easiest mean to earn more & more money. Insurance company working in Alwar is:LIC Allianz bajaj ICICI Prudential LIC Ltd. SBI life Birla sun life Aviva

Statistical Analysis

In this segment I will show my findings in the form of graphs and charts. All the data which I got form the market will not be disclosed over here but extract of that in the form of information will definitely be here.

Detail:
Size of Sample : 150 Area :INDORE Type of Data : 1. Primary : 2. Secondary Industry : Insurance Respondent : Customers

SAMPLE SIZE

Arbitrary kept at 150 for convince and timeliness.

TIME: 1st march - 15th apr. Collection of Data

This step helps in deciding and selecting the techniques that shall be used to collect relevant information which can be used to solve the research problem. The techniques used by me for data collection are : Primary data 1. Secondary data 2. Tertiary data 1. PRIMARY DATA The primary data are those which are collected afresh and for the first time, and thus happen to be original in character. Primary data are: Interview method Questionnaire method 2. SECONDARY DATA Secondary data means data are already available i.e., they refer to the data, which have already been collected and analyzed by someone else. Secondary data are: Books

Magazines Newspapers Report Publication of various associations Connected with business, industry, banks stock exchange, etc.

Limitations Of the Study

As the movement throughout the city is not possible due to certain constraints so the movement was quite restricted Lack of trust on any Company of Private Sector. Lack of knowledge about the products of ICICI Prudential and their total The primary data was confined to only one branch of ALWAR Some respondents did not take the Survey seriously and did not give appropriate answers to the questions asked. Some customers showed no interest in answering the questions because of shortage of time. The analysis has been classified on the basis of view expressed by respondents. It was not possible to understand thoroughly about the different marketing aspects of the Financial Consultant within 8 weeks. As stipend money was not given it was difficult to continue the project work All the work was limited in some limited areas of Alwar so the findings should not be generalized.

ANALYSIS & INTERPRETATION OF DATA

DATA ANALYSIS AND INTERPRETATION

TABLE: 4.1 INVESTMENT OF MONEY FOR GROWTH

Options Percentage of Respondent Yes 88 No 12 Chart: 4.2

Interpretation:88% of the respondents say yes they invest their money to grow. This shows that the main aim of most of the investors is to grow their idle funds so that they can overcome the problems of inflation, etc

TABLE:4.2 BASIC OBJECTIVE AT THE TIME OF INVESTMENT

Options % of respondents Regular returns 52 Income tax benefit 26 Capital appropriation 22 Chart:4.2

Interpretation: 52% of the respondents say basic objectives at the time of investment is Regular returns, 26% of the respondents say basic objectives at the time of investment. Thus the main objective of investment by these individual is regular returns

TABLE: 4.3 PREFERENCES WHILE INVESTING.

Options % of respondents More benefits 22 More security 62 Others, please specify 16 Chart 4.3

Interpretation: 22% of the respondents say they get more benefits, 62% of the respondents say they would like more security. Thus the investors have more likeliness for security than benefits.

TABLE: 4.4THE MOST IMPORTANT PARAMETER WHILE INVESTING

Options % of respondents Returns 26 Risk 28 Credit rating 10 Inflation 8 Company 18 Lock in period 1 Chart:4.4

Interpretation: 28% of the respondents see that the investment is risk free, 26% of the respondents look for returns before investing, and 18% go for the companys position before investin. Thus we see a balanced examination of almost regular factors of the investment made.

TABLE: 4.5 INVESTORS PLANNING TO INVEST IN INSURANCE POLICY

Options % of respondents Yes 46 No 54 Chart 4.5

Interpretation: 46% of the respondents are planning to invest in Insurance Policy. This may be due a large number of factors that individuals do not have higher inclination towards investment. The next question gives the answer to the reason for such non-investment.

TABLE: 4.6 REASONS FOR SUCH DENIAL FOR INVESTMENT:

OPTIONS % OF RESPONDENTS Lack of awareness 30 Risk 24 Fluctuating returns 26 Long term investment 20 Chart: 4.6

Interpretation: 30% of the respondents dont want to invest in Insurance Policy because of Lack of Awareness, 24% of the respondents were not investing in Insurance Policy because of risk. Thus there is a need to give proper knowledge about investment options to large number of people so that the investment market could show a significant increase.

TABLE: 4.7 PREFERRED SCHEME FOR INVESTMENT IN INSURANCE POLICY

Options % of respondents Equity 30 Debt 26 Balanced 24 Gilt 20 Index 0 Chart 4.7

Interpretation:30% of the respondents have invested in Equity funds, 26% of the respondents have invested in Debt Funds, 24% of the respondents have invested and Balanced funds, 20% of the respondents have invested in Gilt Funds. Thus we see that there is higher inclination towards equity funds as they draw higher returns.

TABLE: 4.8 THE REASON FOR PREFERRING ICICI PRUDENTIAL

Options % of respondents Returns 20 Risk 16 Credit rating 12 Inflation 14 Company 30 Lock in period 8 Chart: 4.8

Interpretation:20% of the respondents want to invest in ICICI PRUDENTIAL due to more returns, 30% due to its reputation in market.

TABLE: 4.9 PREFFERD SCHEMES OF ICICI PRUDENTIAL

Options % of respondents Equity 30 Debt 26 Balanced 24 Gilt 20 ndex 0 Chart:9I

Interpretation: 30% of the respondents have invested in Equity funds, 26% of the respondents have invested in Debt Funds, 24% of the respondents have invested n balanced funds, and 20% of the respondents have invested in Gilt Funds.

OBSERVATIONS & FINDINGS

Most of the respondents of the given questionnaire were from private jobs. Since the data collection was done randomly it is observed that higher number of people came from private jobs where their income is satisfiable and due to this they have an inclination towards investment. Most of the respondents say that they invest their money. This investment can be either in fixed assets or any kind of purchase of security. But as per the outcome of the result most of them have more or less interest in shares and online trading. There are very less number of investors who invest in the commodity market as compared to other investment option. This may be due to lack of knowledge and accessibility. Most of the investors said that equity trading gives the highest returns. Statistical data proves the same. There are high fluctuations in the equity share market. If on one side it fetches high returns, on the other it can bring similar losses. Thus it is more of a riskier investment but good players do invest in these. Most of the investors prefer regular returns than taking the advantage of tax benefits or capital appropriation. This is because they have more inclination towards returns than availing any other benefit out of the investment. Just like investors have higher preference for regular returns, they also prefer having more security given to them for their investment. Most of the respondents favoured more security of their asset than anything else. Majority of the investors have higher inclination towards Insurance Policy investment. The reason so assumed is low risk and regular and better returns than other available options for investment.

The main idea of every investor is to firstly examine the companys profile and related issues and then invest. Most of them look for risk and return factors before investing. There were a good percentage of respondents who were further planning to invest in Insurance Policy. This may be due to favourable market conditions, government subsidies and money control methods or growth of the Insurance Policy industry. Among those who had no plans for investing in Insurance Policy said that the reason for the same is that they are not much aware of the Insurance Policy concepts and related industry. Also they felt that it carries a moderate risk which they were not ready to bear. Most of the respondents invested their money in equity market. Although there was a similar number of people who invested equally in debt, balanced and gilt funds. There was higher number of investors who preferred ICICI PRUDENTIAL but not the highest. The respondents were planning to invest in ICICI PRUDENTIAL because of its higher returns and goodwill in the market. ICICI PRUDENTIAL also carries lower risks and thus preferred by investors.

CONCLUSIONS

Investors maturity has increased as today investors are willing to accept the fact that Insurance Policy can lose money because fund manager are not infallible. Market is becoming complex & it means that the individual investor will not have the time to play stock game on his own. The penetration of Insurance Policy have increased this will further help Insurance Policy to reach to every region of India. Newer options & new schemes have created new markets which could be explored in future. Last but not the least Insurance Policy regulations will help to boast up the investor confidence. Investors prefer ICICI PRUDENTIAL because of more returns and low risk. Systematic Investment Plans are also available. Winning with stocks means performing at least as well as a major market index over the long haul. If one can sidestep the common investor mistakes, then one has taken the first and biggest step in the right direction. The most important consideration while making investment decision was Return aspect followed by Safety, Liquidity and Taxability. Diversified stock portfolios have offered superior long term inflation Protection. Equities are especially important today with people living longer and retiring early. To understand stock funds, one needs to be familiar with the characteristics of the different types of companies they hold. Portfolio managers have done a fairly good job in generating positive returns. It may lead to gain investors confidence. On the basis of the analysis the performance of the schemes during the study period can be concluded to be good. Those who want to eliminate the risk element but still want to reap a better then it would be advisable to go for debt or arbitrage schemes which ensure both safety and returns. So

the future of Insurance Policy in India is bright, because it meets investor s needs perfectly. This will give boost to Indian investors and will attract foreign investors also.

SUGGESTIONS&RECOMMENDATION

The insurance industries should try to minimize their risk factor and try their best to enhance their return percentage. The Company should try improving their customer service and other schemes to attract more investors. Proper assistance should be provided to the customer at the time of claim settlement. All the relevant and necessary details about the company should be properly disclosed to the customers. Regular advertisement of the company can be given. The Company can try to find new markets especially in the rural areas. The Company should do frequent analysis of the competitors.

Questionnaire

Name: Gender: Address: Contact no:

Q.1 what is your occupation? A. Private Job B. Govt. Job C. Business D. Retired Q.2 Do you invest your money to grow? A. YES B. NO Q.3 what are the various investment options that u choose from? A. Insurance Policy B. Bonds C. Fixed deposits D. Property E. Commodity market F. Equity G. Others Q.4 which of the given options procures the best returns? A. Insurance Policy B. Bonds C. Fixed deposits D. Property E. Commodity market F. Equity G. Others Q.5 what is your basic objective at the time of investment? A. Regular returns. B. tax benefit.

C. capital appropriation. Q.6 what factor would you prefer more while investing? A. more benefits B. more security. If others, please specify. Q.7 which is the most preferred investment option amongst Insurance Policy and shares? Q.8 what are the parameters that you judge on before investing? Returns Risk Credit rating Inflation Company Lock in period Q.9 Do you have any plans to invest in Insurance Policy? Y/N Q.10 If no, please specify the reason. Is it? A. lack of awareness B. risk C. fluctuating returns D. long term investment Q.11. which is the scheme that you prefer for investment? A. Equity B. Balanced C. Debt D. Gilt E. Index Q.12. which are the companies that you choose to invest in? Options HDFCSL LIC ICICI PRU LIFE SBI Insurance Policy

Tata AIG Insurance Policy Q.13. what is the reason for preferring ICICI PRUDENTIAL? A. low risk B. high returns C. lock in period D. company profile E. credit rating F. inflation Q.14. which scheme of ICICI PRUDENTIAL would you like to adopt? A. Equity B. Debt C. Gilt D. Index E. Balanced

BIBLIOGRAPHY

BOOKS:
Bhalla V.K. (2001), Financial Management & Policy II Edition, Anmol Publications, New Delhi Khan & Jain(1997), Financial Management and Policy, Tata Mc Graw Hill, New Delhi Kothari C.R. (2000), Research Methodology, Wishwa Prakashan, New Delhi Prasanna Chandra (1999), Financial Management, Tata McGraw Hill, New Delhi. Rustagi R.P. (2002), Financial Management, Galgotia Publication, New Delhi. Sharma & Gupta (2001), Financial Management, Kalyani Publication, New Delhi

WEBSITES
www.karvy.com www.investopedia.com www.icicipru.com http://www.icicipruamc.com/aboutus1.html www.appuonline.com. www.valuesearchonline.com www.shriraminvestment.com