Académique Documents
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On Marketing Strategies Activity in Sbi life Insurance At SBI Life Insurance Co Limited
Alakhnanda Tower 3rd Floor, City Centre, Gwalior (M.P)
Submitted Jiwaji University Gwalior For the partial fulfillment of the award of Master of Business Administration (2011-2013) Submitted By (Pradeep Dubey)
DECLARATION
I am Pradeep Dubey, student of MBA IInd semester of Prestige Institute of Management Gwalior; hereby declare that the Summer Training Report entitled Marketing Strategies Activity In Sbi life Insurance in Gwalior (M.P) is submitted by me in partial fulfillment of the requirement for the Master of Business Administration Degree.
I assure that this summer training report is the result of my own efforts and that any other institute for the award of any degree or diploma has not submitted it.
Place: Date:
Preface
Now days in this dynamic era Insurance is coming as an important tool for reducing the effect of uncertainty and risks. It becomes an integral part and indispensable part of human life. There are various types of Insurance Plans to provide protection from loss and uncertainties. So is a great opportunity for me to study on Peoples Perception and awareness are concerning Marketing Strategies Activity In Sbi Life Insurance in Gwalior (M.P). The purpose of this research is to know awareness and importance among peoples regarding Marketing Strategies Activity in Sbi Life Insurance in Gwalior (M.P)
CERTIFICATE
This is to certify that Pradeep Dubey Student of MBA IInd Sem of Prestige Institute Of management Gwalior, has successfully completed his Summer training report. He has prepared this report entitled Marketing Strategies Activity In Sbi Life Insurance under my direct supervision and guidance.
ACKNOLEDGEMENT
Summer Training Report is a combined effort including this one also, so I would like to thank to all who have helped me completion of this report purposeful. We would like to extend our heartfelt gratitude to Prof. Ashish Mehra for his guidance throughout the project. Without his support and cooperation we would have failed in our endeavors and targets in this project. I also want to thank to Mr. Yog Mishra, Unit Manager in SBI LIFE Insurance Co.Ltd. (Sales Dept.), Prof. C K Dantre my mentor and, coordinator assisting me in completion of this project. Further I would like to thanks to all of my Teachers, Staff Members, Library Members, and Friends for their valuable support and advices which helps me a lot to completing this project report purposeful.
Pradeep Dubey
TABLE OF CONTENTS
SEQUENCE 1.
2.
PG. No
Introduction History of the Insurance Company Profile Organizational structure Financial Performance Recruitment Process Welfare activity Product and market competitors Market Share Various productlines Financial analysis SWOT analysis
3. Introduction of the topic 4. Objectives of the Study 5. Results and Discussion 6. Analysis and findings 7. Limitations 8. Recommendations & Suggestions 9. CONCLUSION Reference Annexure
later on the 19th of January, 1956, that life insurance in India was nationalized. About 154 Indian insurance companies, 16 non-Indian companies and 75 provident were operating in India at the time of nationalization. Nationalization was accomplished in two stages; initially the management of the companies was taken over by means of an Ordinance, and later, the ownership too by means of a comprehensive bill. The Parliament of India passed the Life Insurance Corporation Act on the 19th of June 1956, and the Life Insurance Corporation of India was created on 1st September, 1956, with the objective of spreading life insurance much more widely and in particular to the rural areas with a view to reach all insurable persons in the country, providing them adequate financial cover at a reasonable cost.
General Insurer
General Insurance Corporation of India (GIC) GIC has four subsidiary companies The Oriental Insurance Company Limited. The New India Assurance Company Limited. National Insurance Company Limited. United India Insurance Company Limited. Royal Sundaram Alliance Insurance Company Limited. Reliance General Insurance Company Limited. TATA AIG General Insurance Company Ltd. Bajaj Allianz General Insurance Company Limited ICICI Lombard General Insurance Company Limited. Cholamandalam General Insurance Company Ltd. HDFC-Chubb General Insurance Co. Ltd. namely:
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Introduction
SBI LIFE a joint venture between
74%
26%
SBI Life Insurance is a joint venture between the State Bank of India and Cardiff SA of France. SBI Life Insurance is registered with an authorized capital of Rs 1000 core and a paid up capital of Rs 350 carore. SBI owns 74% of the total capital and Cardiff the remaining 26% State Bank of India enjoys the largest banking franchise in India. Along with its 7 Associate Banks, SBI Group has the unrivalled strength of over 14,000 branches across the country, the largest in the world. Cardif is a wholly owned subsidiary of BNP Paribas, which is The Euro Zones leading Bank. BNP is one of the oldest foreign banks with a presence in India dating back to 1860. It has 9 branches in the metros and other major towns in the country. Cardif is a vibrant insurance company specializing in personal lines such as long-term savings, rotection products and creditor insurance. Cardif has also been a pioneer in the art of selling insurance products through commercial banks in France and 29 more countries.SBI Life Insurances mission is to emerge as the leading company offering a comprehensive range of Life Insurance and pension products at competitive prices, ensuring high standards of customer ervice and world class operating efficiency. The company plans to make the insurance buying process quick, simple and based on well-informed judgment. In 2004, SBI Life Insurance became the first company amongst private insurance players to cover 30 lacks lives. The company expects to carve a niche in the Indian insurance market through extensive product innovation and aims to provide the highest standards of customer service through a technological interface. To facilitate this, call centers have been already installed and help lines will be installed and customers will have access to their accounts through the Internet or through SBI branches. The company proposes to make available ready liquidity to its Life Insurance policies by way of loans at SBI counters. This will make Life Insurance a liquid asset in the financial portfolio of households. SBI Life 11
Insurance is uniquely placed as a pioneer to usher bank assurance into India. The company hopes to extensively utilize the SBI Group as a platform for cross-selling insurance products along with its numerous banking product packages such as housing loans, personal loans and credit cards. SBIs access to over 100 million accounts provides a vibrant base to build insurance selling across every region and economic strata in the country.
Group Corporate.
SBI Life extensively leverages the SBI Group as a platform for cross-selling insurance products along with its numerous banking product packages such as housing loans and personal loans. SBIs access to over 100 million accounts across the country provides a vibrant base for insurance penetration across every region and economic strata in the country ensuring true financial inclusion.
CH
R.D
R.S.M
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A.S.M
MD&CEO. M.NRAO
S.R.D.S.M
D.S.M
SR.BSM
B.S.M
A.B.S.M
U.M
AGENCY MANAGE R
TM.A.B.S. M
Management Style
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MANAGEMENT STYLE
INVESTMENT
ACTUARY
IT
HR
MARKETING
OPERATIONS
NEW BUSINESS
UDNERWRITING
CLAIMS
Financial Performance
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Mumbai, January 18, 2011: Sustaining its holistic business performance, SBI Life
Insurance, the leading new generation life insurer, has posted impressive results during the first nine months of the FY 10 - 11. Growing by 52%, the company has set a new milestone, by crossing the landmark figure of Rs 300 Crores in net profit during the period. Reflecting its superior efficiency in it business operations, the company maintains the lowest expense to GWP (Gross Written Premium) ratio in industry of 7.43%. SBI Lifes Gross Written Premium collection grew by 28% to Rs. 7,770 Crores The Asset Under Management jumped by 50 % to Rs 36, 861 Crores from Rs. 24, 613 Crores as on 31st December, 2009. The company has uniquely expanded by adding 134 new branches and increasing number of employees by 1349, during the period, despite tough external conditions. The corporate office has moved to a newly- acquired building in fast evolving commercial hub of Mumbai. The new corporate building was inaugurated by Shri R Sridharan, MD and GE (A & S), State Bank of India. Commenting on the performance, Mr. M N Rao, MD & CEO, SBI Life Insurance said Through continued emphasis on strengthening business fundamentals, namely customer centricity and operational excellence, we are confident that we will sustain our profitable growth performance. We remain committed to catering to the life insurance needs of Indian population encompassing all socio-economic and geographical segments. Highlights of YTD Dec FY 10 11 Gross Written Premium Rs 7,770 Cr Premium New Business Rs 4,699 Cr Asset Under Management ( Y-o-Y) Rs 36, 861 Cr 28% 6% 50%
All key distribution channels namely, Bancassurance, Agency and Corporate Solutions have demonstrated profitable business growth during the period. The Agency Channel provided a significant thrust to the overall business by contributing 44% of total premium as a result of superior productivity levels of Insurance Advisors. Bancassurance witnessed a remarkable growth of 43% and contributed to over 36% cent of the total premium and Group Corporate 15
contributed to 18% of total premium. In the recent months, the company introduced a series of Simple and Smart products that encompass new IRDA guidelines compliant ULIPs, Pure Protection and Traditional products. The rapidly launched six new ULIPs cater to the investment needs of the varied customer segments. These include HNI-targeted Smart Elite, NAV-Guaranteed Smart Performer, No Medicals ULIP Saral Maha Anand, Flexible ULIP Unit Plus Super, Child Plan Smart Scholar and ULIP with Automatic Asset Allocation Smart Horizon. Innovatively-featured, non-ULIPs rolled out are No-Medicals, pure protection plan Saral Shield, HNI targeted, pure protection plan Smart Shield and No Medicals, traditional savings plan Saral. One of the highlights towards achieving customer service excellence has been the national launch of customer care initiative SMS SOLVE. A first-ofits kind in the life insurance industry, the service allows customers to have their grievances resolved in a simpler, paperless and faster manner. An innovative SMS-based service, SMS SOLVE provides customers the ease of accessing SBI Life 24 X 7. Customers are able to register their grievances about SBI Lifes service by merely sending SMS SOLVE to 56161. Testifying its multi-dimensional excellence, the company has bagged numerous recognitions and awards recently. Being adjudged the best, SBI Lifes annual report has won Gold Shield from Institute of Charted Accountants of India (ICAI) for excellence in Financial Reporting. Also, International Certification Services (ICS) has awarded SBI Life "ICS Quality Champion Award - 2010" for continual improvement in the Quality Process. NDTV Profit Business Leadership award and Best Life Insurer 2010, Runner Up, award by Outlook Money are the other key media recognitions that have been conferred to SBI Life. Retaining the ISO 9001:2000 Certification for superior claim process, globally topping the prestigious international MDRT Table and reaffirmation of CRISIL AAA/Stable rating are other key distinctions achieved by the company during initial current financial year. As per the latest IRDA report, as of November 2010, the company has a market share of 18.27% among private life insurers and a total market share of 5.10 %.
Management Philosophy
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Vision :
"To be the most trusted and preferred life insurance provider "
Mission
"To emerge as the leading company offering a comprehensive range of life insurance and pension products at competitive prices, ensuring high standards of customer satisfaction and world class operating efficiency, and become a model life insurance company in India in the post liberalization period".
Values
Trustworthiness Ambition Innovation Dynamism Excellence
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The recruitment process flowchart that we have gone through in our project period
GETTING KNOWLEDGE ABOUT THE COMPANY AND RECRUITMENT PROCESS GETTING KNOWLEDGE ABOUT BENEFIT OF LIFE ADVISOR GETTING KNOWLEDGE ABOUT DOING THE SALES CALL SEGMENTING THE MARKET TARGETING THE MARKET PROCESS OF CAPCTURING ELEGABLE CANDIDATE FILLING OF I.S.F. FORM SHORTLISTING ON THE BASIC OF Q SCORE CONDUCT AN INTERVIEW BOP PRESENTATION FILLING OF COMPULSORY IRDA /NAAF FORM THREE DAYS IRDA REFRESHER TRAINING CONDUCTION OF EXAMINATION TWO DAYS PRODUCT TRAINING
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Key Responsibilities:
Person Profile:
Critical Competencies:
Key Interactions:
Welfare Activities
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Gift Drishti One of our corporate ethos, enhancing our SBI Life brand value, is about giving back to the society. In line with our Corporate Social Responsibility (CSR) initiatives, the cause of supporting our Elderly Citizens was initiated. Incidence of cataract blindness, annually at 3.28 million, is one of the most prevalent health ailments suffered by old people, particularly in rural pockets of our country. On the occasion of World Elder's Day on 1st October, CSR initiative - "Gift Drishti" (Restoring vision) was launched in partnership with HelpAge India, a registered national level voluntary body, working for the cause of disadvantaged aged persons. Restoring vision is done through Intra Ocular Surgery (IOL). SBI Life employees made monetary contributions to the cause. SBI Life donated twice the sum contributed by its employees. Eye sight for thousands of elderly citizens was restored across the rural parts of the country. Gift Drishti Camps
Read India Pledge SBI Life undertook the Corporate Social Responsibility (CSR) initiative, aimed at driving the cause to make children read and write. The campaign, "Read India Pledge" sensitized general public towards the cause and urged them to pledge & support the cause monetarily or by devoting time. The campaign was partnered by Pratham, one of the leading child-cause related NGOs and Radio Mirchi, a leading radio station. Read India Camps
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Bancassurance
Agency
Credit Life
Corporate Group
Insurance Agents
Corporate Agents
Brokers
Insurance Agents:
Insurance agents are those individual persons who work for one particular insurance company. An insurance agent cannot work for more than one particular at one point of time.
Corporate Group:
Targeting Corporate for Gratuity and Group Pension products.
Agency Channel:
Agency channel have the most productive and active force of more than 25,000 Advisor. Our approach is to provide door-to-door need-based insurance solution to customers after taking into account protection and wealth creation needs. Agency channel has grown more than 300%
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over the last year and contributed more than 45% to the companys new business premium collection.
Types of Products
Individual Products
Group Products
Credit Guard
Smart Performer
Sampoorn Smart
Suraksha Plus
RETIREMENT SOLUTIONS
Smart Scholar
Swarna Ganga
Smart Horizon
Swarna Jeevan
Cap Assure
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Disclose to any person; Through any failure to exercise all due care and diligence, cause or permit any
unauthorized disclosure of any trade secrets or confidential information of or relating to SBI Life Life Insurance which he may have received, used or obtained during the term of this Agreement. Any such trade secrets and confidential information shall at all times remain the property of SBI Life Life Insurance.
a.
For the purposes of this clause, trade secrets and/or confidential information shall include, but not be limited to, lists of and information concerning customers, Policyholders, employees, Advisors and agency managers of SBI Life life Insurance, information relating to the working of any product, process, invention, improvement or development carried on or used by SBI Life Life Insurance, information relating to research projects, know-how, prices, rates, discounts, mark-ups, business strategies, marketing, tenders and any price sensitive information concerning SBI Life Life Insurance. For the avoidance of doubt, the obligation of confidentiality in this clause extends to trade secrets and confidential information howsoever stored, whether in hard copy documents, records or computer programs.
b.
Access to SBI Life Life Insurance computer resources, electronic data and the like may be given to and shall be utilized by the Advisor only for the purpose of carrying out the duties embodied in the Agreement.
c.
The forgoing provisions on confidentiality and non-disclosure also apply to employees of both the parties to this Agreement and the sad parties assume liability for the breach or violation in any manner by their employees.
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Globally topped the prestigious Million Dollar Round Table (MDRT) 2010 for having the maximum number of MDRT members. Awarded the Gold Shield by Institute of Chartered Accountants of India (ICAI) for Excellence in Financial Reporting. Won the ICS Quality Champion Award 2010 for Continual Quality Improvement. Adjudged Best Life Insurer 2010 - Runner Up by Outlook Money 24
Launched an innovative customer care initiative - SMS SOLVE for prompt Grievance Redressal. Appraised at Maturity level 3 of Capability Maturity Model Integration (CMMI) Version 1.2 for its ISG Division. ICRA reaffirmed iAAA rating to SBI Life, indicating highest claims paying ability and meeting policyholders obligations. CRISIL, countrys leading rating agency, reaffirmed its highest financial rating AAA/Stable to SBI Life. Financial Year 09-10: Reported a robust Net Profit of Rs.276 Crores. Crossed Rs.10,000 Crores in Gross Written Premium (GWP). Ranked No.1, in New Business Premium, amongst private life insurance companies. Assets Under Management (AUM) grew by 96% to Rs.28, 551 Crores. Globally topped the prestigious MDRT 2009 for having Maximum number of MDRT Members. ICRA reaffirmed iAAA rating to SBI Life indicating highest claims paying ability. Awarded ISO Certification (ISO/IEC 27001:2005) for Information Security Management System (ISMS). Retained ISO 9001:2000 certificate for superior claim settlement process.
Financial Year 08-09: Ranked among global top three in terms of number of Million Dollar Round Table (MDRT) members. Bagged the coveted personal finance award-Outlook Money NDTV Profit "Best Life Insurer 2008". CRISIL, countrys leading rating agency, reaffirmed its highest financial rating AAA/Stable to SBI Life. In 2007, SBI Life became the first life insurer in India to receive this rating from CRISIL. ICRA assigned iAAA rating indicating highest claims paying ability to SBI Life Insurance Retained ISO 9001:2000 certificate for superior claim settlement process. 25
Financial Year 07-08: Ranked amongst global top five life insurance companies in the number of MDRT members. Rated as the The Most Trusted Private Life Insurer according to a survey conducted by Brand quity in association with AC Nielsen ORG-MARG and the Economic Times Intelligence Bureau. Received the highest financial rating AAA from CRISIL. Forayed into micro insurance with the launch of Grameen Shakti in Bhubaneshwar, Orissa for the economically underprivileged sections of society. Received ISO 9001: 2000 certification for superior claim settlement process. Received CMMI Level 3 certification for IT processes and software development capabilities.
Financial Year 06-07: Second consecutive year of Profitability. More than 6.40 Million lives covered Financial Year 05-06: Reported a robust net profit of Rs. 2.02 Cr
MARKET SHARE
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SBI LIFE LEADS GLOBALLY AT MILLION DOLLAR ROUND TABLE (MDRT) 2011 Mumbai, September 28, 2011 - SBI Life Insurance, the leading private life insurer, retains the unique distinction of being the only Life Insurer from India, topping the prestigious Million Dollar Round Table (MDRT) 2011 across the globe. For the third consecutive year, SBI Life has reached the pinnacle of the international coveted league by having 2,661 MDRT members in 2011. Amongst these, 200 have achieved Court of Table (COT) and 30 Top of Table (TOT) membership status. SBI Life has been consistently featuring amongst the top five insurers, worldwide, since last five years. Globally, the company ranked 5th in 2007, 3rd in 2008, 1st in 2009, 2010 and 2011. Reputation, standard of sales excellence and high ethical standards are some of the key values that are associated with the MDRT brand. The MDRT membership is an exclusive honor that is achieved by less than 1 percent of the world's life insurance and financial services advisors. Life Insurance professionals aspire to attain the privilege of being an MDRT member
Mr. M. N. Rao, MD & CEO, SBI Life, said, "Across the globe, both, Agent and Insurance Facilitator at bank, continue to be a reliable source of personal financial advise. Our accomplishment on a global platform testifies the professional approach followed by our distributors. We will continue to focus on equipping them with relevant support to enable advisory-based delivery of life insurance solutions to our customers." Mr. Rajiv Gupta, Executive Director, Marketing, SBI Life added "This towards upon accomplishment creating as quality resonates our commitment advisors who can be looked world-class Providing benchmarks. Rank Company Name 1 2 3 4 5 13 21 31 33 SBI Life Insurance New York Life Samsung Life Insurance LIC Of India Northwestern Mutual HDFC Standard Life ICICI Prudential Life TATA AIG Life Max New York Life Country 2010
Members India 2,661 USA 2,067 Rep of Korea 2,052 India 1,993 USA 1,260 India 489 India 341 India 207 India 203
need based solutions, professional advice and unmatched service will remain the focal delivery points for our Advisors ". An opportunity to represent one of the most trusted brands in the country, superior training program and attractive reward and recognition programmes are some of benefits availed by SBI Life Insurance Advisors. Mr. Anand Pejawar, Executive Director, Marketing, SBI Life added "In addition to highly productive Retail Agency Channel, our 27
integrated bancassurance approach continues to create value for Bank customers and Facilitators of our products. The bank employee, involved in the sale of the insurance products, has rapidly evolved to deliver holistic banking and insurance solutions to their customers making the bank truly a super market for all financial requirements". During the first financial quarter ending June 2011, SBI Life recorded a profit of Rs. 144 Crores, registering an impressive profit growth of 27% over the corresponding period last year. The total premium of the company grew by 13 % to Rs. 1935 Crores during the period. The new business premium collected, during the period, stood at Rs. 892 Crores. Further, the Assets under Management grew by 33%, over the corresponding period last year, to Rs. 40,070 Crore as on 30th June 2011. The company continues to have the lowest expense to GWP (Gross Written Premium) ratio in industry of 10.14%. Uniquely, despite tough external conditions, SBI Life continues to expand its presence. During the current financial year, the company has introduced 81 branches and recruited 1657 employees. SBI Life ranks number one amongst private players, as per the latest IRDA report, July 2011. The company has a market share of 21.6% among private life insurers and a total market share of 6%.About MDRT:MDRT is an association of the world's best life insurance sales (advisors) professionals. Founded in 1927, MDRT is an international, independent association of nearly 36,000 of the world's leading life insurance and financial services professionals from 76 nations and territories, representing over 450 companies. MDRT members are recognized as skillful professionals who are considered to be among the best in the industry, perform outstanding client service, and have achieved the highest standard of sales excellence in the life insurance and financial services business
SWOT ANALYSIS
SBI LIFE INSURANCE CO. LTD AT A GLANCE Joint venture between State bank of India and BNP Paribas Assurance. SBI is the largest bank in India and BNP Paribas Assurance is Frances largest Insurance company. Investments: SBI-76% and BNP Paribas 24%. 28
The Company started its operations in 29th March2001. Provides Life Insurance Solutions to Individuals and Corporates.
STRENGTHS
No.1 Private Life Insurance company in India (as on 2009-10). Leverages the State Bank Group Relationship as a platform for cross-selling insurance products. As it sells its products through banc-assurance division of SBI,therefore less need on spending money for establishing separate branch offices. Market share of 18.34% among private life insurers and a total market share of 6.44%. SBIs access to over 100 million accounts across the country provides for a vibrant base for insurance penetration in the country. Growth at a rate of 40%. IRDA has never banned any of SBI Lifes product. Only private life insurance company to have posted profits (Rs 276 crores for they earended March 31st ,2010)and declared bonus. Solvency ratio of 2.2 and share capital of Rs.1000 Crore, SBI Life is one of the most capita lefficient life insurance companies in the industry.
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Continues to maintain the lowestexpense to GWP (Gross Written Premium) ratio in industry of 6.5% Globally topping the prestigious international MDR Table ( Million DollarRound Table 30 Lacs collections by an agent in a year ). One of the market leaders in Unit Linked Plans by offering products asSmart ULIP, UNIT +, UNIT +2, UNIT +3 etc. Profitable business growth demonstrated by all key distribution channels. Certifications of ISO 9001:2000, ISO 2700:2005 ( Information security ) AAA rating by ICRA, CRISIL etc. Superior Claims Settlement Process ( certified by ISO 9001:2000 ). Asset Under Management jumped by 96% to Rs 28,551 Crand New Business Annualised Premium Equivalent (APE) by 37% to Rs.6,358 Crores. Restructured Customer Grievances Redressal Mechanism. Regional Directors and Regional Channel Heads resolves customer complaints at local level. Through My policy portal in www.sbilife.co.in,customers can view all policy details including Payment Summary, Fund Value and Premium Calendar.
WEAKNESSES
Less sales force than others (LICs 3 field advisor: SBIs 1field advisor) Low productivity of banc-assurance people. People at top management/decision making level are from SBI. So,typical PSU attitude in many aspects. Hassle free online purchase of insurance policy is not available Is less aggressive in generating business compared to other private life insurance players. Over dependence on the banc-assurance channels . Less branch office compared to others.
OPPORTUNITIES
As only 12% of the 40 crores insurable population is insured, thus, a huge opportunity to reach out to more people.
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It has an edge over LIC as far as service is concerned. So, it can grab moremarket share from LIC by giving it a tough competition. Not so much requirement on establishment of Brand (already have a good brandimage of SBI). A huge revolutionary change (PARIBARTAN) in SBI is going to happen,so there is an immense opportunity for SBI Life in future. Huge market potentiality in Rural markets which has been untapped till now. Higher market penetration by being more aggressive in banc-assurance channelof distribution. Huge opportunity to grab customers by being more active through otherdistribution channels as mall-assurance, brokers etc.. Lower premium ULIP policy (<10000) can attract lower income segment market.
THREATS
Huge competiti on from other pre-existing 22 players in the Life Insurance sector in India. ICICI Prudential, the market giantal ready pipped SBI Life to regaint opposition, garnering new business worth Rs.303 crores (source Economic Times,26th May10) New entrants in the pipe line of the life insurance business. New tie-ups of competitors with innovative distribution channels.The New Insurance guidelines from September10 onwards is really a big challenge or SBI Lifes bus
Business benefits
This project has helped SBI Life in tapping new markets, reducing IT maintenance costs, simplifying channel management, and enhancing customer experience. Operationally, it has 31
tightly integrated applications, bringing together enterprise applications, digitized content, Web sites, e-mail, workflow integration and extensive search capabilities, besides reducing cost and time-to-market. SBI Life is pleased with this IT initiative, and is planning to open services to partners from its portal. It is also moving to rolling out departmental business portals addressing its specific needs, integration with mobility devices using WAP, SMS etc., integration with new Open Source tools, and provisioning to allow compliance with new regulatory requirements such as ACCORD. Concludes Murali, In technology they are planning to have service level agreement monitoring and management,end-to-end auditing, policy-based management, and distributed fault management and alerting.
Corporate Office:
SBI Life Insurance Co. Ltd, "Natraj", M.V. Road & Western Express Highway Junction, Andheri (East), Mumbai - 400 069
Benefit
Commission Renewal Commission Bonus 33
Quarterly gifts ACER club membership facility MDRT Promotion factor for an agent Domestic and International Conventions
Opportunity/
Advisor require no capital investment They can chose there own working hour according to there convenience. They are there own boss. Unlimited earning potential Represent a strong trusted brand.
OPPORTUNITY
Advisor requires no capital investment:- For starting any business we require a huge infrastructure but here in SBI Life the Advisors do not require any capital investment other than RS. 825 IRDA examination fees, which is very nominal and on return the Advisors get free phone calling facility, Xerox facility etc. They can choose there own working hour according to there convenience:- Advisor are free to work in there convenient hours because the advisors working here comes from different profession like Doctor, Engineer, Student, Medical Representative, contractor etc. They are there own boss:- There is no boss to give you target rather you are your own boss and can work according to your pleasure and earning requirement. Unlimited earning potential:- As the payment is made on commission basis so there is no limit to earning. A person working hard can go to any limit with reward and recognition in extra.
MARKET SEGMENTATION
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Segmentation refers to a process of bifurcating or dividing a large unit into various small units which have more or less similar or related characteristics.
Market Segmentation
Market segmentation is a marketing concept which divides the complete market set up into smaller subsets comprising of consumers with a similar taste, demand and preference. A market segment is a small unit within a large market comprising of like minded One market segment is totally distinct from the other segment. A market segment comprises of individuals who think on the same lines and have The individuals from the same segment respond in a similar way to the fluctuations
individuals.
mix. Therefore, the key to market segmentation is to take the so called mass market with a heterogeneous set of needs and through the use of creative research efforts divide it up into smaller parts or segments thus giving the insurance marketer some direction in shaping his product offerings.
(1) Segmentation by Life Cycle: - Hass and Barry in their book Systems selling of
Retail Services advocate the classification of financial customers into household according to the stages in the life cycles. There is ample evidence according to them that the financial needs and expectations of households will vary according to stages in the cycle. For example, young married couples with no children have the same size household as older couples whose children no longer live at home. The insurance needs of these two 5 segments which an insurance marketer should identify would tend to differ in certain respects.
The Life Cycle Segments are:(i) The Bachelor stage young single people. (ii) Newly married couples- young no children. (iii) The full nest 1- Young married couples with dependent children (iv) The full nest II- Older married couples with dependent children. (v) The empty nest-Older married couples with no children living with them. (vi) The Solitary survivors- Older single people segmentation by life cycle provides a good starting point for an effective packaging or systematization of insurance products.
Insurance companies price differently life policies which are designed for smokers or motors policies which are designed for smokers or motors policies or fast sports car drivers.
(ii) Demographic Segmentation: - Occurs when the insurance marketer determines that
customers respond differently to marketing offerings on the basis of their sex, age, size of immediate family, income level, occupation, formal education, religion, race or stage in the 37
family life cycle. Demographics are a popular basis for segmentation since they often have a strong and significant relationship to an insurers sales and are easier to recognize and measure than most other variables.
(i) Students- The segment has been recognized recently by insurers for its future potential
and measures aimed to cater especially for students are based on the philosophy that students will retain their loyalty after graduation. On the other hand, the student market segment is considered to carry quite high risks by the insurance industry, particularly because of student high incidence of loss of personal belongings and proneness to car or motorcycle accidents.
(ii) Women-Women form about 50% of the population. They demand very special attention
on the very basis of substantiality. For the insurance sector, the new independent role of women means a new market segment whether they are single, married or unmarried mother.This has been a neglected segment for a very long time by the Insurance Industry but they have now recognized that an increasing number of women are attaining management positions through better education opportunities and as such are capable of exerting commercial influence.
enterprise and setting, reviewing and achieving its goals. He calls this central function Corporate Strategy and defines it further as follows:- Corporate strategy is the pattern of decisions in a company that determines and reveals its objectives, purposes or goals, producing the principal policies and plans for achieving these goals A market segment consists of a group of customers who share a similar set of needs and wants. The market does not create the segments; the marketers task is to identify the segments and decide which one to target. And for insurance company we segmented market into following different groups. Geographical region:- we segmented Gwalior into five segment i.e; East Gwalior, West Gwalior, North Gwalior, South and Central Gwalior. Demographic age:- we segmented the entire population of Gwalior into following three categories on the basis of demographic age i.e; 18 to 20 age group, 25 to 40 age groups and above 40. Family life cycle:- we segmented the entire population of Gwalior into following three categories on the basis of family life cycle i.e; Single, Married, Retired/VRS Optee. Gender:- we segmented the entire population of Gwalior into following two categories on the basis of two categories i.e; Male and Female Income:- we segmented the entire population of Gwalior into following three categories on the basis income below 2 lakhs, 2 to 5 lakhs, more than 5 lakhs. Occupation:- we segmented the entire population of Gwalior into following six categories on the basis of there occupation like Student, Government employee, Private Employee, House Wife, Self employed and Unemployed. Education:- we segmented the entire population of Gwalior into following three categories on the basis of there education which is 10th or 12th standard, Graduate, Post Graduate and above. Social class:- we segmented the entire population of Gwalior into following three categories on the basis of social status that is Lower class, Middle class and Upper class. Once the firm has identified its market-segment it looks for Targeting and for
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insurance company Targeting the most prospective candidate requires segmenting of market into :-
Needs based Segmentation:- This is the most preferred and positive target segment of
insurance company because most positive result comes from this segment targeting, like Extra income need Job need Carrier need
--- J.H.MAGEE
40
Life insurance contract may be defined whereby the insurer, in consideration of premium paid either installment, undertakes to pay an annuity on the death of the insured of a certain number of years.
--- R.S.SHARMA
A contract of life assurance is that in which one party agrees to pay a given sum on the happening of a particular event contingent upon the duration of human life in consideration of immediate payment of a smaller sum by another.
Insurance advisor
A life adviser is a broker or intermediary authorized to sell or advise on the policies of life insurance and financial products, such as unit trusts. Typical examples of companies which employ financial advisers are banks, insurance and life companies, general brokers, estate agents and building societies The presence of a life insurance policy is essential in every individual's financial portfolio. But at the same time, it is also important that the right insurance products be bought and that too for the right reasons. With so many insurance products vying for a place in the individual's portfolio, conducting a proper evaluation can become quite a task. Taking the help of an insurance advisor/agent can help solve this problem. An insurance advisor/agent can play the part of the direct link between the insurance company and the insurance seeker i.e. you. He is the one who can help you select the right policy i.e. one which can help you fulfill your insurance needs. But for this, it is important that you connect with an expert and qualified insurance advisor/agent. The task is to choose the good quality advisor those who are having the following quality. Confidence Self motivation And Persuasion Urge to be financiallyindependent Relationship skills I have to recognize where a person (whom I meet to recruit him/her as an advisor) havingall these characteristics or not .If some person is closed enough to these characteristicsthen. I discussed the following support pattern.After getting all these information an advisor basically asked about the workingenvironment. Then I discussed the working environment and try to convince him/her that he/she has the potential to become an agent/advisor. 1. To be part of a world class sales team. 2. Work from his/her (advisor) own office or residence. 3. Work full time or part time. 4. Earn commission, bonus and incentives. 41
5. No upper limits on earnings. 6. Flexible career.Therefore the first and for most problem is to convinced that person those whohaving enough patience to listen my companies idea/views.The role of the advisor is to quite effective to search a good prospect.
FUNCTION OF ADVISORS:
Advisors provide on going financial advice for his /her client/prospect. In our official term prospect is a person who can buy life insurance from us.The advisors study the prospects needs and persuade them to buy a policy.Complete all formalities for proposal of new insurance, including filling up forms.collecting premium. arranging medical examination, collecting proofs (of age/income), reports and information required by the underwriter.After having sold a new insurance policy, the advisor has to ensure that the policy continues. without a lapse. till it becomes a claim. For that reason anadvisor has to do the following: 1. Keep in touch with the policy holder to make sure that renewal premiums are paid in time. 2. Ensure that nominations are made or changed, if necessary 3. Assist in collecting claim amounts.As an advisor you contribute in bringing in new business for the company offer world class pre and post sales service to the clients with the support of theorganization.But an advisor to us means much more than a salesman or a, saleswoman, at SBI LIFE recognize our advisors as the ambassadors of our organization in the market place and we consider the advisor force would be our biggest differentiating factor in thecoming years.That is why; we take a lot of care in recruiting and developing our advisor force, so thatwe can maintain our standards of quality in service and salesmanship. The competition and the customer awareness have forced the times to be a knowledgeoriented marketplace. Appreciating the same we strive to get people with reasonablygood graduation background as our advisors. We also acknowledge and recognize prior 11sales experience of the persons, at the time of recruitment.The other function is to be of assistance to the policy holder in case he/she needs a loanunder the policy.
ROLE OF AN ADVISOR:
1. Identify future clients/prospect 2. Making appointment. 2. Conduct financial review meeting with prospect. 4. Close sale. 42
5. Get referral 6. Provide service to clients/prospect. 7. Follow internal sales and reporting system.After analyzing the quality(which the company is looking for), back office service(which the company is giving to that person). functions to be performed, role to be played .I used to describe the benefits which the advisor can get out of his/her joiningas an advisor in SBI Life Insurance Company.
j. Begin soliciting proposals for various insurance products at dates set by SBI Life Life Insurance; k. Be fully responsible and accountable for all its acts and omissions; l. Obtain, maintain, renew and keep renewed the prescribed licences issued by the IRDA and any other licence, approval or permission required of it for fulfilling the obligations of an Advisor at all times during the term of this agreemet; m. At all times during te term of this Agreement, act within the scope of such licences, approvals and permissions and any applicable legislation ad in consonance with the corporate image and objectives of SBI Life Life Insurance. The Advisor shall promptly notify SBI Life Life Insurance of the loss of any suc licence, approval or permission by it or by its certified persons; n. Submit to SBI Life Life Insurance within the period of time specified by SBI Life Life Insurance in writing from time to time, all proposals and initial premiums, for products solicited by Adviosr and in any case within the time specified by 64VB(4) of the Insurance Act, 1938 or any other statutory provisions applicable thereto. The Advisor shall remit to SBI Life Life Insurance all monies collected in trust immediately and without any deduction whatsoever. o. Observe and be bound by the Statutory provisions, SBI Life Life Insurance Instructions including Advisor manual, benefit illustration policy, cash acceptance policy, market conduct guidelines, prevention of money laundering policy, the compliance manual and the code of conduct that may be issued by SBI Life Life Insurance, in writing, from time to time relating to the conduct of the business; Monitoring, supervision and performance standards of the business and sales practices used in relation to SBI Life Life Insurance products that may be issued by SBI Life Life Insurance, in writing, from time to time; p. Promptly deliver to SBI Life Life Insurance in good order and condition when
demanded all records, rate books, documents, manuals, computers (hardware and software relating in any way to the life insurance business of SBI Life Life Insurance and which were received from SBI Life Life Insurance, including those that have been 44
specifically entrusted to the Advisor pursuant to this Agreement. Advisor here by acknowledges that such good, tangible and otherwise, and the exclusive property of SBI Life Life Insurance; q. Maintain and observe at all times the strictest secrecy and confidentiality, concerning the business of SBI Life Life Insurance or of Policyholders or proposers of Life Insurance or persons or companies from time to time dealing with SBI Life Life Insurance at any time, either while the Agreement is in force or subsequent to its termination; r. Bear all expenses incurred in the performance of duties under this Agreement unless otherwise specifically agreed to in writing by SBI Life Life Insurance; s. Promptly disclose to SBI Life Life Insurance every fact and circumstance within his knowledge relevant to the acceptance of the risk of business by SBI Life Life Insurance and shall promptly and accurately relate to SBI Life Life Insurance every fact disclosed to him relevant to the acceptance of such risk or business howsoever the Advisor is aware of such matter; t. Promptly notify SBI Life Life Insurance of receipt by it or service on it of any complaint, demand, notice or claim made or to be made under a policy howsoever the advisor is aware of such matter. u. Record and reolve, within the standard turn around time of 7days from receipt, all the complaints and requests/inquiries received from customers of Advisor and statutory/regulatory bodies and forward a report of the complaints, requests and inquiries of the past week with the relevant documentation containing details like Date of Complaint, Policy older Name, Advisor name and Code No., MOA Name and No., Nature of Complaint, Date of Complaint Forwarded to the concerned function for resolution, Status (Resolved /Pending), Resolution date to SBI Life Life Insurance at the specified email address on every Thursday of the next week. v. Ensure that a strong needs analysis is carried out for every prospect during the sales process; w. Ensure strict adherence to the prevention of Money laundering and Terrorist Financing Policy of SBI Life Life Insurance, the prevention of Money Laundering Act, 2002, 45
Rules thereunder and the IRDA Anti Money Laundering (AML) guidelines and modification thereto and employ adequate know Your Customer (KYC) standards as prescribed therein; x. In the event of finding any adverse or suspicious change on the standing, integrity or reputation of the customer/policyholder, Advisor should promptly disclose the same to the Principal compliance officer of SBI Life Life Insurance in change of Anti Money Laundering programme. In the event Advisor fails to comply with this provision and/or exposes SBI Life Life Insurance to AML related risks, SBI Life Life Insurance shall be entitled to terminate this Agreement with all attendant consequences to the Advisor; y. Act as a fiduciary, in good faith and I the best interests of SBI Life Life Insurance at all times during the continuance of this Agreement; and z. Declare his adherence to the code of sales and Business Conduct in the format prescribed in Schedule A.
Every Institute should have at least one qualified permanent faculty who is an Associate or Fellow from the Insurance Institute of India for each stream i.e. for Life and Non-Life. The attendance register of the faculty members should be maintained at the training institutes. The record of the payment made to faculty should be maintained at the training institute i.e. batch-wise payment detail should be maintained. The faculty should provide details of the other Institutes with whom they have been empanelled as part-time/guest faculty. Register should be maintained at the training institute giving details of batches completed, strength of the each batch, number of candidates decertified, name of the sponsored insurer and details of faculty who imparted the training with dates. The seating capacity of each class-room should not exceed 40. The fresh accreditation will be given on need basis after assessing the needs of the particular city/town. The initial approval will be for a period of 3 years and consideration of further renewal up to 3 years would depend on the satisfactory compliance of requirements of accreditation. The insurance companies would regularly send their officials to oversee the proper conduct of the training at the institutes and would not sponsor candidates to those institutes that are not maintaining the required standards of and facilities for the training. The training institute must display the certificate of accreditation to impart training issued by the Authority at the training institute. The Institute should not allow a franchisee to conduct courses on its behalf even if the faculty is that of the Institute. The Institute should conduct the training on its own premises or hired premises with proper infrastructure. No marketing fee/consultancy fee payment is permitted for getting the training batches. It will be the responsibility of the Insurance Company to check the status of the institute before sponsoring any candidates for training.
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In case of mofussil areas or the cities where there are no accredited institutes and an insurance company intends to appoint agents, it will be the responsibility of the insurance company to conduct training. The Institutes must keep with them one set of records of the training at the place where the training is being imparted. The Institute should confine its activities only to the place/city for which it has been given the approval. No training outside the said place/city is permitted. The Institutes must submit a copy of the lease deed/rent agreement at the time of seeking fresh accreditation/renewal/change of address of the institute. On successful completion of training the candidates get COT i.e. the Completion of Training Certificate by SBI Life INSURANCE? Basic aim of the insurance plan satisfies the following objectives: Protection of economic value of assets. Mechanism to reduce impact of adverse events on value generating assets.
Types of insurance Insurance is generally classified into three main categories: 1. Life Insurance. 2. Health Insurance. 3. General Insurance. To get insurance an individual or an organization can approach to Insurance Company directly, through Insurance agent of the concerned company or through intermediaries. Life insurance or life assurance is a contract between the policy owner and the insurer, where the insurer agrees to pay a sum of money upon the occurrence of the insured individual's or individuals' death or other event, such as terminal illness or critical illness. In return, the policy owner agrees to pay a stipulated amount called a premium at regular intervals or in lump sums.
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There may be designs in some countries where bills and death expenses plus catering for after funeral expenses should be included in Policy Premium.
NEED OF LIFE INSURANCE . The functions of Insurance can be bifurcated into two parts:
1.Primary Functions 2.Secondary Functions 3. Other Functions
The primary functions of insurance include the following: Provide Protection - The primary function of insurance is to provide protection against
future risk, accidents and uncertainty. Insurance cannot check the happening of the risk, but can certainly provide for the losses of risk. Insurance is actually a protection against economic loss, by sharing the risk with others.
Collective bearing of risk - Insurance is a device to share the financial loss of few among
many others. Insurance is a mean by which few losses are shared among larger number of people. All the insured contribute the premiums towards a fund and out of which the persons exposed to a particular risk is paid.
The secondary functions of insurance include the following: Prevention of Losses - Insurance cautions individuals and businessmen to adopt suitable
device to prevent unfortunate consequences of risk by observing safety instructions; installation of automatic sparkler or alarm systems, etc. Prevention of losses causes lesser payment to the assured by the insurer and this will encourage for more savings by way of premium. Reduced rate of premiums stimulate for more business and better protection to the insured.
Small capital to cover larger risks - Insurance relieves the businessmen from security
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The other functions of insurance include the following: Means of savings and investment - Insurance serves as savings and investment,
insurance is a compulsory way of savings and it restricts the unnecessary expenses by the insured's For the purpose of availing income-tax exemptions also, people invest in insurance.
Risk Free trade - Insurance promotes exports insurance, which makes the foreign trade
risk free with the help of different types of policies under marine insurance cover.
LIMITATION
The research area was restricted only within the Sikar city. This may not reflect the exact position of the total market. Sample size was also so less, limitation of time means and resource forced for small size. Questionnaire includes 16 questions, which affects the mentality of respondents that is time consuming.
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Following are suggestions made for the benefits and augmentation of the sound working of the company SBI life insurance 1. Need to train and develop life insurance agents with more comprehensive knowledge and skills to counter every queries of the customer. 2. It is suggested that company should not left any stone unturned towards sound advertisement and promotional measures on every section whether it is printed, media or air via radio.
3. It is also suggested that skilled management graduates need to be places on sales and
marketing of financial services that can render their best ideas for the accomplishment of the company goals and objectives to the best extent. 4. Also, care need to be taken that every customers grievance should be met with delight whether before purchase or after sales. 5. There should be an expansion measure for more offices and location of more centers for offices of the company is established sop that company may grow its network. 6. Life insurance Products should be made flexible so as to suit every section of society.
SuggestionsFollowing are suggestions made for the benefits and augmentation of the sound working of the company SBI life insurance: 1. Need to train and develop life insurance agents with more comprehensive knowledge and skills to counter every queries of the customer. 2. It is suggested that company should not left any stone unturned towards sound advertisement and promotional measures on every section whether it is printed, media or air via radio. 3. The advisors should be made aware and educated so that they can extend their services not only in terms of collection of premium checks from the customer but also to educate them about the insurance and the latest nontraditional plans. 4. All the company should come out of a unit link product that should aid every selection of the society. 51
5. It is also suggested that skilled management graduates need to be places on sales and marketing of financial services who can render their best ideas for the accomplishment of the company goals and objectives to the best extent. 6. Also, care need to be taken that every customers grievance should be met with delight whether before purchase or after sales. 7. There should be an expansion measure for more offices and location of more centers for offices of the company be established sop that company may grow its network.
CONCLUSION
Summer training is a best example for a trainee to learn about the company working, corporate culture under which is operating the functions. SBI life insurance company under which I gained a significant knowledge with respect to life insurance, its importance and applicability as well as undertook the task to recruit capable life insurance advisors which is conducive for the company to grow with more prosperity. What I taught in the management institute utilized them fruitfully leading to the best advantage to the company and to the best experience for mine. In all Public Service jurisdictions, new approaches to recruitment are being used.In many 52
territories, the strategies are manual but, as automated methods become more pervasive, those mechanisms that support its use will assume greater popularity. Whatever the strategies selected for use, the objective is to recruit the most qualified, committed individuals into the organizations and ensure that the provision of government services to the public is timely and effective, that the goods are of consistent high quality and that the organizations achieve the objectives for which they have been established. Life insurance is a noble service which is very important for every citizen to learn and realize its importance because this is the only source which can remain the status where one is with the family bread earner and ever when he is not.With the growing financial sector I would like to opt this industry for my future career advancement and as an opportunity to service this industry.
Questionnaire:
Q.1. What do you mean by life insurance? a) Protection of human asset value against uncertainty b) A sum received after death c) Both Q.2. Do you think life insurance is essential for every one? a) Yes
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b) No Q.3. What is your qualification? a) Post graduate b) Graduate c) Senior secondary Q.4. Do you come under: a) 18-25 age group b) 25 35 age group c) 35 45 age group d) Above 45 age group Q.5. Would you like to know about a career in life insurance advisor ship where you can fulfill every desire of your life? a) Yes b) No Q.6. Do you perceive that life insurance business is a noble service oriented business? a) Yes b) No Q.7. Would you like to become or opt for life insurance advisor under esteemed and prospering organization SBI Life insurance? a) Yes b) No Q.8. Do you agree that the life insurance business is a growing industry and will grow and rapid pace in future?
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a) Yes b) No Q.9. Do you favor the privatization of life insurance by the Government where a significant number of companies now in the market for life insurance to the customers with the alliance of multinationals? a) Yes b) No SUGGESTION:
1. 2.
BIBLIOGRAPHY
Following are sources which helped me during my summer training-
MAGAZINES:
India Today
Business World Business Economics LSEs Magazine
NEWSPAPER:
The Economics times The Hindu Times of India Business line D.N.A
OTHERS:
IRDA annual report, 2006-07and 2007-08 Manual of Insurance by Bharat Law House
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