MAJOR PROJECT

ON

To Compare the products of HDFC Standard Life

Insurance Company Limited and Tata AIG Life
Insurance Company Limited

SUBMITTED IN PARTIAL FULFILLMENT FOR THE AWARD OF THE

DEGREE OF BACHELOR OF BUSINESS ADMINISTRATION
(BANKING AND INSURANCE)

UNDER THE GUIDANCE OF: SUBMITTED BY: HRIDAY

[Link] SINGH ENROLLMENT NO: 00712401814
B.B.A (B&I), 6th SEM

DELHI INSTITUTE OF RURAL DEVELOPMENT

(AFFILIATED TO GURU GOBIND SINGH INDRAPRASTHA UNIVERSITY)
 STUDENT UNDERTAKING

This is to certify that I HARIDAY had completed the project titled To Compare the
products of HDFC Standard Life Insurance Company Limited and Tata AIG Life
Insurance Company Limited under the guidance of MS SHIVANGI SINGH in the
partial fulfillment of the requirement for the award of degree of BBA (Banking &
Insurance) from Delhi Institute of Rural & Development (Affiliated to G.G.S.I.P
University), New Delhi. This is an original piece of work and I had neither copied nor
submitted it earlier elsewhere.

Student Name & Signature

Course

Dated:
 CERTIFICATE FROM GUIDE

This is to certify that the project titled To Compare the products of HDFC Standard
Life Insurance Company Limited and Tata AIG Life Insurance Company Limited
is an academic work done by HRIDAYsubmitted in the partial fulfillment of the
requirement for the award of the Degree of BBA (Banking & Insurance) from Delhi
Institute of Rural & Development (Affiliated to G.G.S.I.P. University), New Delhi under
my guidance and direction. To the best of my knowledge and belief the data and
information presented by him in the project has not been submitted earlier,

Name & Signature of the Faculty Guide

Designation
 PREFACE
HDFC Standard Life insurance is the oldest life insurance company in the world. It is the
largest insurer in the UK and is the 28 th largest company in the world. In India, the
company is marketing life insurance products and unit linked investment plans. From my
research at HDFC SLIC, I found that the company has a lot of competition from other
private insurers like ICICI, Aviva, Birla Sun Life and Tata AIG. It also faces competition
from LIC. To compete effectively HDFC SLIC could launch cheaper and more
reasonable products with small premiums and short policy terms (the number of years
premium is to be paid). The ideal premium would be between Rs. 5000 Rs. 25000 and
an ideal policy term would be 10 20 years.
HDFC must advertise regularly and create brand value for its products and services. Most
of its competitors like Aviva, ICICI, Max, Reliance and LIC use television advertisements
to promote their products. The Indian consumer has a false perception about insurance
they feel that it would not benefit them if they do not live through the policy term.
Nowadays however, most policies are unit linked plans where a customer is benefited
even if their death does not occur during the policy term. This message should be
conveyed to potential customers so that they readily invest in insurance.
Family responsibilities and high returns are the two main reasons people invest in
insurance. Optimum returns of 16 20 % must be provided to consumers to keep them
interested in purchasing insurance.
On the whole HDFC standard life insurance is a good place to work at. Every new recruit
is provided with extensive training on unit linked funds, financial instruments and the
products of HDFC. This training enables an advisor/sales manager to market the policies
better. HDFC was ranked 13 in the Best Places to Work survey. The company should try
to create awareness about itself in India. In the global market it is already very popular.
With an improvement in the sales techniques used, a fair bit of advertising and
modifications to the existing product portfolio, HDFC would be all set to capture the
insurance market in India as it has around the global.
 TABLE OF CONTENT

[Link]. Title Page no.

1 Introduction 6-9

2 Company profile 9-37

3 Objective 37-38

4 Research & Methodology 39-42

5 Data Analysis 43-50

6 Limitation 51-52

7 Conclusion 52-53

8 Suggestion 53-54

Bibliography

Annexure
 INTRODUCTION

AN OVERVIEW

With the largest number of life insurance policies in force in the world, Insurance
happens to be a mega opportunity in India. Its a business growing at the rate of 15-20 per
cent annually and presently is of the order of Rs 1560.41 billion (for the financial year
2006 2007). Together with banking services, it adds about 7% to the countrys Gross
Domestic Product (GDP). The gross premium collection is nearly 2% of GDP and funds
available with LIC for investments are 8% of the GDP.

Even so nearly 65% of the Indian population is without life insurance cover while health
insurance and non-life insurance continues to be below international standards. A large
part of our population is also subject to weak social security and pension systems with
hardly any old age income security. This in itself is an indicator that growth potential for
the insurance sector in India is immense.

A well-developed and evolved insurance sector is needed for economic development as it

provides long term funds for infrastructure development and strengthens the risk taking
ability of individuals. It is estimated that over the next ten years India would require
investments of the order of one trillion US dollars. The Insurance sector, to some extent,
can enable investments in infrastructure development to sustain the economic growth of
the country.

6
HISTORICAL PERSPECTIVE

The history of life insurance in India dates back to 1818 when it was conceived as a
means to provide for English Widows. Interestingly in those days a higher premium was
charged for Indian lives than the non - Indian lives, as Indian lives were considered more
risky to cover. The Bombay Mutual Life Insurance Society started its business in 1870. It
was the first company to charge the same premium for both Indian and non-Indian lives.

The Oriental Assurance Company was established in 1880. The General insurance
business in India, on the other hand, can trace its roots to Triton Insurance Company
Limited, the first general insurance company established in the year 1850 in Calcutta by
the British. Till the end of the nineteenth century insurance business was almost entirely
in the hands of overseas companie

Insurance regulation formally began in India with the passing of the Life Insurance
Companies Act of 1912 and the Provident Fund Act of 1912. Several frauds during the
1920's and 1930's sullied insurance business in India. By 1938 there were 176 insurance
companies.

The first comprehensive legislation was introduced with the Insurance Act of 1938 that
provided strict State Control over the insurance business. The insurance business grew at
a faster pace after independence. Indian companies strengthened their hold on this
business but despite the growth that was witnessed, insurance remained an urban
phenomenon.

Assurance Company, Oriental Insurance Company and United India Insurance Company.
These were subsidiaries of the General Insurance Company (GIC).

7 7

KEY MILESTONES
1912: The Indian Life Assurance Companies Act enacted as the first statute to regulate
the life insurance business.

1928: The Indian Insurance Companies Act enacted to enable the government to collect
statistical information about both life and non-life insurance businesses.

1938: Earlier legislation consolidated and amended by the Insurance Act with the
objective of protecting the interests of the insuring public.

1956: 245 Indian and foreign insurers along with provident societies were taken over by
the central government and nationalized. LIC was formed by an Act of Parliament- LIC
Act 1956- with a capital contribution of Rs. 5 crore from the Government of India.

INDUSTRY REFORMS

Reforms in the Insurance sector were initiated with the passage of the IRDA Bill in
Parliament in December 1999. The IRDA since its incorporation as a statutory body in
April 2000 has fastidiously stuck to its schedule of framing regulations and registering
the private sector insurance companies. Since being set up as an independent statutory
body the IRDA has put in a framework of globally compatible regulations.

The other decision taken simultaneously to provide the supporting systems to the
insurance sector and in particular the life insurance companies was the launch of the
IRDA online service for issue and renewal of licenses to agents. The approval of
institutions for imparting training to agents has also ensured that the insurance companies
would have a trained workforce of insurance agents in place to sell their products.

8
PRESENT SCENARIO - LIFE INSURANCE INDUSTRY IN INDIA
The life insurance industry in India grew by an impressive 47.38%, with premium
income at Rs. 1560.41 billion during the fiscal year 2006-2007. Though the total volume
of LIC's business increased in the last fiscal year (2006-2007) compared to the previous
one, its market share came down from 85.75% to 81.91%.

The 17 private insurers increased their market share from about 15% to about 19% in a
year's time. The figures for the first two months of the fiscal year 2007-08 also speak of
the growing share of the private insurers. The share of LIC for this period has further
come down to 75 percent, while the private players have grabbed over 24 percent.
With the opening up of the insurance industry in India many foreign players have entered
the market. The restriction on these companies is that they are not allowed to have more
than a 26% stake in a companys ownership.

Since the opening up of the insurance sector in 1999, foreign investments of Rs. 8.7
billion have poured into the Indian market and 19 private life insurance companies have
been granted licenses.

Innovative products, smart marketing, and aggressive distribution have enabled fledgling
private insurance companies to sign up Indian customers faster than anyone expected.
Indians, who had always seen life insurance as a tax saving device, are now suddenly
turning to the private sector and snapping up the new innovative products on offer. Some
of these products include investment plans with insurance and good returns (unit linked
plans), multi purpose insurance plans, pension plans, child plans and money back plans.

9
9

COMPANY PROFILE

HDFC STANDARD LIFE INSURANCE COMPANY LIMITED

INTRODUCTION
HDFC Incorporated in 1977 with a share capital of Rs 10 Crores, HDFC has since
emerged as the largest residential mortgage finance institution in the country. The
corporation has had a series of share issues raising its capital to Rs. 119 Crores. The gross
premium income for the year ending March 31, 2007 stood at Rs. 2,856 Crores and new
business premium income at Rs. 1,624 Crores. The company has covered over 8, 77,000
lives year ending March 31, 2007.

HDFC operates through almost 450 locations throughout the country with its corporate
head quarters in Mumbai, India. HDFC also has an International Office in Dubai, UAE
with service associates in Kuwait, Oman and Qatar. HDFC is the largest housing
company in India for the last 27 years.

SNAPSHOT-I

Incorporated in 1977 as the first specialized Mortgage Company in India.

Almost 90% of initial shareholding in the hands of domestic institutes and retail
investors. Current 77% of shares held by foreign institutional investors.
Besides the core business of mortgage HDFC has evolved into a financial
conglomerate with holdings In:
HDFC Standard Life insurance Company- HDFC holds 78.07 %.
HDFC Asset Management Company HDFC holds 50.1%
HDFC Bank- HDFC holds 22.25%.
Intel net Global (Business Process Outsourcing) HDFC holds 50%.
HDFC Chubb General Insurance Company HDFC holds 74%.

10
10
SNAPSHOT-II

Loan Approvals Rs. 805 billion.

 (Up to Dec 2007) (US $ 18.30 bn.)
Loan Disbursements Rs.669 billion
(Up to Dec. 2007)(US $ 15.20 bn)
Housing Units financed 2.5 million.
Distribution
Offices 181
Outreach Programs 90

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

Mr. Deepak M Satwalekaris the Managing Director and CEO of the Company since
November, 2000. Prior to this, he was the Managing Director of HDFC Limited since
1993. Mr. Satwalekar obtained a Bachelors Degree in Technology from the Indian
Institute of Technology, Bombay and a Masters Degree in Business Administration from
The American University, Washington DC.

11
11
GROUP COMPANIES

HDFC Bank: World Class Indian Bank- among the top private banks in India.
HDFC AMC: One of the top 3 AMCs in India- Preferred investment manager.
Intelenet Global: BPO services for international customers.
CIBIL: Credit Information Bureau India Limited.
HDFC Chubb: Upcoming Private companies in the field of General Insurance.
HDFC Mutual Fund
HDFC [Link]: Helps to search properties in all major cities in India
HDFC securities

STANDARD LIFE

Standard Life is Europes largest mutual life assurance company. Standard Life, which
has been in the life insurance business for the past 175 years is a modern company
surviving quite a few changes since selling its first policy in 1825. The company
expanded in the 19th century from kits original Edinburgh premises, opening offices in
other towns and acquitting other similar businesses.

Standard Life Currently has assets exceeding over 70 billion under its management and
has the distinction of being accorded AAA rating consequently for the six years by
Standard and Poor.

12 12

SNAPSHOT
 Founded in 1875, company supporting generation for last 179 years.
Currently over 5 million Policy holders benefiting from the services offered.
Europes largest mutual life insurer.

JOINT VENTURE

HDFC Standard Life Insurance Company Limited was one of the first companies to be
granted license by the IRDA to operate in life insurance sector. Reach of the JV player is
highly rated and been conferred with many awards. HDFC is rated AAA by both
CRISIL and ICRA. Similarly, Standard Life is rated AAA both by Moodys and
Standard and Poors. These reflect the efficiency with which HDFC and Standard Life
manage their asset base of Rs. 15,000 Cr and Rs. 600,000 Cr. respectively.

HDFC Standard Life Insurance Company Ltd was incorporated on 14 th August 2000.
HDFC is the majority stakeholder in the insurance JV with 81.4% staple and Standard of
as a staple 18.6% Mr. Deepak Satwalekar is the MD and CEO of the venture.
HDFC Standard Life Insurance Company Ltd. Is one of Indias leading Private Life
Insurance Companies, which offers a range of individual and group insurance solutions.
It is a joint venture between Housing Development Finance Corporation Limited (HDFC
Ltr.

13

13

BUSINESS GROWTH
Track Record so far
the gross premium income of HDFC, for the year ending March 31, 2007 stood at Rs.
2,856 crores and new business premium income at Rs. 1,624 crores.

The company has covered over 8, 77,000 lives year ending March 31, 2007. Company
also declared our 5th consecutive bonus in as many years for our with profit
policyholders.

KEY STRENGTH

Financial Expertise:
As a joint venture of leading financial services groups. HDFC standard Life has the
financial expertise required to manage long-term investments safely and efficiently.
Range of Solutions:
HDFC SLIC has a range of individual and group solutions, which can be easily
customized to specific needs. These group solutions have been designed to offer complete
flexibility combined with a low charging structure.
Strong Ethical Values:
HDFC SLIC is an ethical and Cultural Organization. False selling or false commitment
with the customers is not allowed.
Most respected Private Insurance Company:
HDFC SLIC was awarded No-1 Private Insurance Company in 2004 by the World Class
Magazine Business World for Integrity, Innovation and Customer Care.

14
14
CORPORATE OBJECTIVE:

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

.Integrity
.Innovation
.Customer centric
.People Care One for all
.Teamwork
.Joy and Simplicity

PRODUCTS & SERVICES

The right investment strategies won't just help plan for a more comfortable tomorrow --
they will help you get Sar Utha ke Jiyo. At HDFC SLIC, life insurance plans are
created keeping in mind the changing needs of family. Its life insurance plans are
designed to provide you with flexible options that meet both protection and savings
needs. It offers a full range of transparent, flexible and value for money products. HDFC
SLIC products are modern and contemporary unitized products that offer unique
customer benefits like flexibility to choose cover levels, indexation and partial
withdrawals.

15
15

PLANS THAT ARE OFFERED BY HDFC STANDARDS LIFE INSURANCE

Individual Products:

Protection Plans
A person can protect his family against the loss of his income or the burden of a loan
in the event of his unfortunate demise, disability or sickness. These plans offer
valuable peace of mind at a small price. Protection range includes our Term
Assurance Plan&Loan Cover Term Assurance Plan.

Investment Plans

HDFC SLICs Single Premium Whole of Life plan is well suited to meet long term
investment needs. This provides attractive long term returns through regular bonuses.

Pension Plans
Pension Plans help to secure financial independence even after retirement. Pension
range includes Personal Pension Plan, Unit Linked Pension,Unit Linked Pension
Plus.

Savings Plans

Savings Plans offer a flexible option to build savings for future needs such as buying
a dream home or fulfilling your childrens immediate and future needs.

Savings range includes Endowment Assurance Plan, Unit Linked Endowment,

Unit Linked Endowment Plus,Unit Linked Endowment Plus II,Money Back,
Unit Linked Enhanced Life Protection II,Children's Plan, Unit Linked Young
Star, Unit Linked Young Star Plus, Unit Linked Young Star Plus II.

16
16

Group Products:
One-stop shop for employee-benefit solutions

HDFC Standard Life has the most comprehensive list of products for progressive
employers who wish to provide the best and most innovative employee benefit solutions
to their employees. It offers different products for different needs of employers ranging
from term insurance plans for pure protection to voluntary plans such as superannuation
and leave encashment.
HDFC SLIC offers the following group products to esteemed corporate clients:

Group Term Insurance

Group Variable Term Insurance
Group Unit-Linked Plan

An investment solution that provides funding vehicle to manage corpuses with

GratuityDefined Benefit or Defined Contribution Superannuation or Leave Encashment
schemes of your company
Also suitable for other employee benefit schemes such as salary saving schemes and
wealth management schemes

Social Product:

Development Insurance Plan

Development Insurance plan is an insurance plan which provides life cover to members
of a Development Agency for a term of one year. On the death of any member of the
group insured during the year of cover, a lump sum is paid to those member beneficiaries
to help meet some of the immediate financial needs following their loss.

17

17
Eligibility
Members of the development agency and their spouses with:
- Minimum age at the start of the policy 18 years last birthday
 - Maximum age at the start of policy 50 years last birthday
Employees of the Development Agency are not eligible to join the group. The group to be
covered is only eligible if it contains more than 500 members.
Premium Payments
The premium to be paid will be quoted per member in the group and will be the same for
all members of the group.
The premium can only be paid by the Development Agency as a single lump sum that
includes all premiums for the group to be covered. Cover will not start until the premium
and all the member information in our specified format has been received.
Benefits
On the death of each member covered by the policy during the year of cover a lump sum
equal to the sum assured will be paid to their beneficiaries or legal heirs. Where the death
is as a result of an accident, an additional lump sum will be paid equal to half the sum
assured. There are no benefits paid at the end of the year of cover and there is no
surrender value available at any time.

18
Prohibition of rebates
Section 41 of the Insurance Act, 1938 states
[Link] person shall allow or offer to allow, either directly or indirectly, as an inducement
to any person to take out or renew or continue an insurance in respect of any kind of
risk relating to lives or property in India, any rebate of the whole or part of the
commission payable or any rebate of the premium shown on the policy, nor shall any
18
person taking out or renewing or continuing a policy accept any rebate, except such
rebate as may be allowed in accordance with the published prospectus or tables of the
insurer
[Link] any person fails to comply with sub regulation (previous point) above, he shall be
liable to payment of a fine which may extend to rupees five hundred
INTRODUCTION TO UNIT LINKED FUNDS

Unit linked plans are based on the component of the premium or the contribution of
the customer towards the plan. This contribution can be in different modes like yearly,
half yearly, quarterly and monthly. Unit linked plans have multiple benefits like life
protection, rider protection, savings, transparency, investment choices, liquidity and
planning for taxes. These plans work like mutual funds.

The premium is collected from the policy holder. He is allotted a certain number of
units based of his contribution. The Net Asset Value is the value of each unit of the
fund. It is found by subtracting the charges and current liabilities from the current
assets and investments and dividing this number by the total number of outstanding
units.

19

UNIT LINKED VERSUS OTHER FINANCIAL INSTRUMENTS

Parameters RBI Bonds Fixed Deposits Mutual Funds Unit linked

Safety High High Medium High

Liquidity None High High High

19

Returns Low Low High High

 Life Cover 1 time amount 1 time amount 1 time amount 10 times

Tax benefits Tax free Taxed Taxed Tax free

We find that life insurance unit linked plans is a good area to invest money in as it
provides liquidity, safety, high returns, life cover and tax benefits in a single plan.
HDFC SLIC offers the option of indexation to beat inflation. Risk is reduced to a large
extent as the company invests in a diversified portfolio of stocks.

20

Tax Benefits

INCOME TAX GROSS ANNUAL HOW MUCH HDFC STANDARD

20
SECTION SALARY TAX CAN YOU LIFE PLANS
SAVE?
 Sec. 80C Across All income Up to Rs. 33,990 All the life insurance
Slabs saved on plans.
investment of
Rs. 1, 00,000.

Sec. 80 CCC Across all income Up to Rs. 33,990 All the pension plans.
slabs. saved on
Investment of Rs.1,
00,000.

Sec. 80 D Across all income Up to Rs. 3,399 All the health insurance
slabs saved on riders available with the
Investment of conventional plans.
Rs. 10,000.

TOTAL SAVINGS
Rs37,389
POSSIBLE

Rs. 33,990 under Sec. 80C and under Sec. 80 CCC , Rs.3,399 under
Sec. 80 D, calculated for a male with gross annual income
exceeding Rs. 10,00,000.
Sec. 10 (10)D Under Sec. 10(10D), the benefits you
receive are completely tax-free, subject to
the conditions laid down therein.

20
AWARDS AND ACCOLADE OF HDFCSL

AWARDS
APRAIL 200
ADFEST 2007 3 Awards 21
Our advertising has helped create high awareness for our brand and has bagged 2 silver
and 1 bronze awards at the ADFEST 2007 National Awards organized by Advertising
Agencies Association of India (AAAI, the premier advertising body in India).

The 3 awards that our ads won are notable for a number of reasons:
The ADFEST 2007 is the biggest national awards festival in the marketing and
advertising field.
The 3 awards are the highest won by any single brand in the Financial Services business
(including Banking, MF, Insurance other Financial Services).
The 2 silvers were won in a category where the gold was not awarded to any brand. Thus
the silver was the best that any brand could have got.
Our brand topped radio as a medium across all brands - across all industries.

b. March 2007
4Ps Power Brand 2007

HDFC Standard Life was selected as '4Ps Power Brand 2007', for being one of Indias
25 Best Startup Companies in an exclusive survey conducted by ICMR (Indian Council
of Market Research) and 4Ps - Business and Marketing (a Business and Marketing
magazine published by Plan man Media). The list of companies was prepared based on
innovative and new concepts brought about to serve the Indian consumers. The research
on the 25 best startups was based upon the number of years since the company has been
established vis-a-vis the growth of the company.

c. August 2006

21
HDFC Standard Life has been as '4Ps Power Brand 2006', for being one of India's Top 25
5'Most Innovative Companies' in an exclusive survey conducted by ICMR (Indian
22
Council of Market Research) and 4Ps - Business and Marketing (a Business and
Marketing magazine published by Plan man Media). The survey highlighted 25
companies that have made India think differently and radically through their Business
and Marketing practices. HDFC Standard Life was the only company selected from the
insurance domain. Besides us, the list included giants like (in no particular order) HLL,
Microsoft, Nokia, LG, Samsung, IBM, HP, ITC Group, Hero Honda, Bajaj Auto,
Ranbaxy, ICICI Bank, SBI Bank, Bennett, Coleman & Co. Ltd., Tata Group, Kingfisher
Airlines, Bharti Televentures, Pantaloon, General Electric, HPCL, Maruti, Anil Dhirubhai
Group, Reliance Industries and CNBC TV 18.

ACCOLADE:
a. March, 2008
Unit Linked Savings Plan Advertisement Tops Mint Best TV Ads Survey
Mint 24/03/2008
The Unit Linked Savings Plan advertisement of HDFC Standard Life, one of the leading
private insurance companies in India, has topped Mints Top Television Advertisement
survey conducted, for February 2008. HDFC Standard Lifes Unit Linked Savings Plan
advertisement was ranked 4th in terms of a combined score of ad awareness and brand
recall and 3rd in terms of ad diagnostic scores (likeability, enjoyment, believability, and
claim). The respondents were between 18 and 40 years. Mints exclusive report, New
voices in a makeover outlines the survey in detail.
b. January2008
4Ps Business and Marketing's recent issue covers '60 Glorious Advertising & Marketing
Moments' over the last 60 years in India.
Issue dated 21/12/2007 to 03/01/2008
The 50's have been named as the era of setting up new institutions with Air India Mahar
Maggi Noodles, Lalitaji endorsing Surf and others; since 1991 where the massive inflow
of brands into India, initiated a veritable deluge of marketing and positioning strategies,
22
with the famous Ericsson commercial, Cadbury's 'Kya Swad Hai Zindagi Mein' and
many others.
23
In the new millennium, ideas that created an impact include the 'Incredible India'
campaign, Hutch campaign with the little pup 'Chika', Indianised version of coke
commercials featuring Aamir Khan, among many others. In this feature they have made a
special mention on Insurance advertising becoming 'happier' as one of those glorious
moments. Earlier, insurance advertisements showed signs of negativity and focused on
just protection. It mentions HDFC Standard Life to be "....one of the first private insurers
to break the ice using the idea of self respect (Sar Utha Ke Jiyo) instead of 'death' to
convey its brand proposition, which was then, followed by others including ICCI
Prudential, thus giving us the credit of bringing up one such glorious advertising and
marketing moment in last 60 years!
c. December 2007
A survey of the best ads on television in November in which HDFC Standard Life
pension plans, topped the ad diagnostics and came in eighth on ad reach - Mint
24/12/2007
Our pension advertising was ranked first in terms of ad diagnostic scores (including
likeability, credibility, and enjoyment).
Especially important as respondents were between 18 and 40 yrs and therefore our target
prospects.
And was ranked 8th in terms of a combined score of ad awareness and brand recall.
Our advertising started in the last week of November and therefore has managed to reach
audiences quickly, especially since the study was done in November. Given our media
spends, our industry and other brands in the ranking, this score is very encouraging.
December 2007
Column 'AGK SPEAK" in Business Standard by A.G. Krishnamurthy (AGK), an
advertising industry veteran, where he has spoken highly about our pension commercial.
Business Standard 21/12/2007

d. AGKSPEAKWHAT IVE LIKED - Straight to the heart!

23
I have often said that nothing makes an ad work like empathy. Find a connect and you
have done it! That is exactly what the HDFC Pension Plans television commercial, airing
24
on most channels, currently achieves. Even though the target audience might not have
been me and my wife but rather, a younger couple who should be investing their earnings
wisely, we both felt an instant bonding with the couple on screen!
The casting has been done so superbly that I am sure that the reaction must be common
across the country. Although the couple expresses sentiments that might seem alien to the
children of today, they are very much a part of our syntax. Admittedly, todays girls are
far more independent and wouldnt dream of total dependence on any one, it was not
quite so just a generation ago. It was the norm rather, for a husband to be totally
responsible for his wifes comfort and yes, statements like Did you ask for my hand to
put me through all this strike a chord. So even if my daughters generation is reminded
of their parents when this ad airs, I am sure it still does its job by getting them to plan for
a light-heated retirement depicted by the ever-so identifiable on screen pair.
e. September 2007
JusConsults Ad Box Office Monthly Monitor (featured in Economic Times)- HDFC
Standard Life was ranked 6th amongst The 10 most effective ads in September 2007. It
moved up from 56th in August 2007. JuxtConsults Ad Box Office is Indias biggest
monthly monitor of most effective television ads amongst urban consumers. The ranking
was based on the total effectiveness of the ad in connecting the brand with the consumers.
JuxtConsults Ad Box Office Monthly Monitor (featured in Economic Times)- HDFC
Standard Lifes ad slogan Sar Utha Ke Jiyo was ranked 10th in the Top 10 Top-of-mind
ad slogans in September, 2007 (The ranking was based on how much our ad slogan
recalled top of mind in the daily ad clutter.)
f. december2006-January 2007
HDFC Standard Life was ranked 29th in the most trusted Indian Brands amongst the Top
50 Service Brands of 2006. This study was conducted by Brand Equity (Economic Times
supplement). HDFC SL moved up 16 places to be positioned at number 29 (was earlier at
45). The highest jump amongst all service brands
24

TATA AIG LIFE INSURANCE COMPANY LIMITED

Introduction 25

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

THE TATA GROUP:

The Tata Group is one of India's largest and most respected business conglomerates, with
revenues in 2004-05 of $17.8 billion (Rs. 799,118 million), the equivalent of about 2.8
per cent of the country's GDP. Tata companies together employ some 215,000 people.
The Group's 32 publicly listed enterprises - among them standout names such as Tata
Steel, Tata Consultancy Services, Tata Motors and Tata Tea - have a combined market
capitalization that is the highest among Indian business houses in the private sector, and a
shareholder base of over 2 million. The Tata Group has operations in more than 40
countries across six continents, and its companies export products and services to 140
nations.

AIG:
American International Group, Inc. (AIG), world leaders in insurance and financial
services, is the leading international insurance organization with operations in more than
130 countries and jurisdictions. AIG companies serve commercial, institutional and
individual customers through the most extensive worldwide property-casualty and life
insurance networks of any insurer. In addition, AIG companies are leading providers of
retirement services, financial services and asset management around the world. AIG's
common stock is listed on the New York Stock Exchange as well as the stock
.25

26

Tata AIG has strong brand name and recall factor which most of its competitors lack in.
Other than the public behemoth Life Insurance Corporation (LIC) of India which has a
major hold in the market share (of approximately 79%), the private players too are having
more and more opportunities to tighten their hold of the market. Of the private players,
ICICI Prudential comes first with an almost 4.50% of the market share followed by Tata
AIG with about 2.10% of the pie. The private players have everything to work for,
especially with LIC not meeting the needs of its clientele with respect to the services they
need. This provides a prospect for the private sector players to increase their share of the
market. Companies with a familiarity such as Tata AIG can especially achieve their
targets due to the brand image that the Tata group has.

A recent survey conducted by the Voluntary Organization in Interest of Consumer

Education (VOICE) revealed Tata AIG Life Insurance Company (Tata AIG Life) as the
clear winner in terms of customer satisfaction in the life insurance category. This is
India's first-ever customer satisfaction study for the insurance sector.

The survey also revealed that Tata AIG Life had a high recall as a reputed brand name.
The ability to provide innovative and customer-focused service such as allowing the
maximum grace period for premium payment has not only further distinguished Tata AIG
Life from other life insurance companies but also appealed to consumers.

PRODUCTS & SERVICES:

Corporate life insurance products:
Employee Benefits
Credit Life
Group Pensions
Workplace Solutions
26
Individual
27 life insurance products:
Health First
Health Protector
 Mahalife
Invest Assure II, Invest Assure Gold

With respect to individual life insurance products, Tata AIG has an array of policies to
suit the needs and requirements of all age groups via, children, students, adults, retirees
etc.

The SUPPORT arm of Tata AIG Life is constituted of Operations, Human Resources,
Marketing, Corporate Training, Finance and Compliance.

Tata AIG Life possesses the philosophy and drive to customize retirement obligations (for
the company) which occur in the form of cash outflows, for the maximum benefit of both
the employer and the departing employee.

27

28

COMPETITORS
With respect to individual life insurance products, Tata AIG has an array of policies to
suit the needs and requirements of all age groups via, children, students, adults, retirees
etc.
The SUPPORT arm of Tata AIG Life is constituted of Operations, Human Resources,
Marketing, Corporate Training, Finance and Compliance.
Tata AIG Life possesses the philosophy and drive to customize retirement obligations (for
the company) which occur in the form of cash outflows, for the maximum benefit of both
the employer and the departing employee.

LIFE INSURANCE CORPORATION OF INDIA (LIC)

LIC has an excellent money back policy which provides for periodic payments of partial
survival benefits as long as the policy holder is alive. 20% of the sum assured is payable
after 5, 10, 15 and 20 years and the balance 40% is payable at the 20 th year along with
accrued bonus.

For a 25 years term , 15% of the sum assured becomes payable after 5,10,15 and 20 years
and the balance 40% plus the accrued bonus becomes payable at the 25 th year. An
important feature of these types of policies is that in the event ofthe death of the policy
holder at any time within the policy term the death claim comprises of full sum assured
withoutdeducting any of thesurvival benefit amountswhich have already been paid. The
bonus is also calculated on the full sum assured.

HDFC SLIC does not have a money back policy. It could offer a money back plan and
capture some portion of this market. While marketing insurance products I found that

many customers wanted to purchase these plans.

28

LIC offers 66 different plans;29plans are formulated for specific occasions whole life
plans, term assurance plans, money back plan for women, child plans, plans for the
28handicapped individuals, endowment assurance plans, plans for high worth individuals,
pension plans, unit linked plans,
Special plans, social security schemes diversified portfolio of products. HDFC SLIC
could diversify its product portfolio. It could add more plans for high worth individuals
and women.

ICICI PRUDENTIAL
ICICI Prudential is a stiff competitor for HDFC SLIC. The company is a merger between
ICICI Bank which is the biggest private bank in India and Prudential Plc which is a
global life insurance company.

The company has an investment plan which is market related Invest Shield Life. In this
plan even if the market falls, the premium will be returned to investors. It is a guaranteed
plan which ensures the company carefully invests your money. The stock market
performance of ICICI Prudential is much better than HDFC SLIC. The returns on the
growth fund were 46.28% compared to the 42.70% offered by HDFC SLIC. Customers
are attracted by higher returns and this is a plus point for Prudential.

The company is very well advertised. The advertisements are showcased in movies,
television, newspapers, magazines, bill boards, radio etc. The company has an excellent
brand ambassador Mr. Amitabh Bachan. His promotion of the company builds trust and
faith in the minds of our people.

However the charges are very high in the plans offered by ICICI Prudential. It is 35%
during the first year, 15% in the next year and 3% from the third year onwards. Also a
higher minimum premium of Rs. 8000 is charged. Hence the policies are not accessible to
the lower strata of the society.
29
30

BIRLA SUN LIFE

Birla Sun Life Insurance Company Limited is a joint venture between The Aditya Birla
Group, one of the largest business houses in India and Sun Life Financial Inc., a leading
international financial services organization. The local knowledge of the Aditya Birla
Group combined with the expertise of Sun Life Financial Inc., offers a formidable
protection for your future.

The Aditya Birla Group has a turnover close to Rs. 33000 crores with a market
capitalization of Rs. 53400 crores (as on 31st March 2007). It has over 72000 employees
across all its units worldwide. It is led by its Chairman - Mr. Kumar Mangalam Birla.
Some of the key organizations within the group are Hindalco and Grasim.

Sun Life Financial Inc. and its partners today have operations in key markets worldwide,
including Canada, the United States, the United Kingdom, Hong Kong, the Philippines,
Japan, Indonesia, India, China and Bermuda. It had assets under management of over
US$343 billion, as on 31st March 2007. The company is a leading player in the life
insurance market in Canada.

Being a customer centric company, BSLI has invested heavily in technology to build
world class processing capabilities. BSLI has covered more than a million lives since
inception and its customer base is spread across more than 1000 towns and cities in India.
All this has assisted the company in cementing its place amongst the leaders in the
industry in terms of new business premium income. The company has a capital base of
520 crores as on 31st July, 2007.

Its Flexi Life Line Plan offers life long insurance cover till the policy holder is 100 years
of age. There are guaranteed returns of 3% p.a. net of policy charges after every 5 years
from the eleventh policy year onwards. However the charges are very high. The initial
charges for the first year are 65%. Hence the fund value is greatly reduced.
31
30
BAJAJ ALLIANZ
Bajaj Allianz is a joint venture between Allianz AG with over 110 years of experience in
over 70 countries and Bajaj Auto, a trusted automobile manufacturer for over 55 years in
the Indian market. Together they are committed to offering you financial solutions that
provide all the security you need for your family and yourself. Bajaj Allianz is the
number one private life insurer for the year 2005 2006. It is leading by 78 crores. It has
experienced a whopping growth of 216% in the last financial year.

DIFFERENCE BETWEEN HDFC SLIC AND TATA AIG

Funds available with ULIP Plans

General Description Nature of Investments Risk Category

Primarily invested in company
Equity Funds stocks with the general aim of capital High
appreciation
Invested in corporate bonds,
Income, Fixed Interest
government securities and other fixed Medium
and Bond Funds
income instruments
Sometimes known as Money
Market Funds invested in cash,
Cash Funds Low
bank deposits and money market
instruments
Combining equity investment
Balanced Funds Medium
with fixed interest instruments

risk but it gives high return, Debt fund has low risk so it gives low return and Balanced
fund is combination of both Equity and Debt fund so risk is medium and return is also
31
32
Both HDFC SLIC and Tata AIG LIC have 7 types of funds based on combination of
DebtEquity fund. These are liquid fund, stable managed fund, secure managed fund,
defensive managed fund, balanced managed fund, equity managed fund, growth fund.
 32
Taxation
You have the option to increase your regular premiums by an indexation rate at any
policy anniversary to protect the real value of your investment against inflation. The rate
of indexation will be in line with the increase in the Whole Sale Price Index (or in the
event that this Index ceases to be published such other index as the Company may select
for this purpose). The base sum assured and sum assured of any attached rider would also
be increased by the corresponding indexation increase.
Charges, Fees and Deductions in ULIP

Premium Allocation Charge:

This is a premium-based
33
charge. After deducting this charge from premiums, the
remainder is invested to buy units. The Allocation charges are guaranteed for the
entire duration of policy term.
Mortality Charge:
The Mortality Charge will apply on the Sum at Risk (SAR = Sum Assured less the Fund
Value pertaining to regular premiums). It will be deducted by monthly cancellation of
units from the accumulation unit account. The Mortality Charge shall remain guaranteed
throughout the policy term.

Fund Management Charge:1% p.a. on With Profits Fund, 1% p.a. on Debt Fund,

1.25% p.a. on Balanced Fund and 1.50% p.a. on Growth Fund. FMC will be applied

on the fund while calculating NAV on a daily basis. The maximum FMC on any fund

is 2% p.a. subject to prior approval by the IRDA.

33

Policy Administration Charge:

Rs. 60 per month, which will increase by 5% p.a. on the 1st of January each year.
PAC will be deducted monthly by cancellation of units from the accumulation
unit account. If premiums are discontinued, this charge would reduce to 60% of
the charge applicable for the premium paying policies

Surrender Charge:

This is the charge that applies when the policy is surrendered. It is equal to 50% of
the difference between regular premiums expected and those paid in the first year of
the contract.

34
 34

Tax Benefits

Tax benefits will be as per Section 80C& Section 10(10D) of the Income Tax Act, 1961.
Insurance is tax free up to Rs. 100000 per annum and the returns on investment on
maturity of the policy are also tax free.

Riders and Bonuses

HDFC Standard Life

Tata AIG Life Insurance
Insurance
Free Look Period 15 days 15 days
Based on company's Based on company's
Reversionary Bonus
performance performance
35
Based on company's Based on company's
Terminal Bonus
performance performance
TOP UP Minimum Rs. 5000 Minimum Rs. 5000
 Riders
Gives on diagnosis of Gives on diagnosis of
Critical Illness (CI) Benefit anyone anyone
of 6 critical illness of 12 critical illness
Additional Term Benefit
Provides Provides
(ATB)
Accidental Death Benefit
Provides Provides
(ADB)
Double Benefit Provides Does not provide
Triple Benefit Provides Does not provide
Payer Benefit Rider (PBR) Does not provide Provides

35
Points of Difference

HDFC Standard Life

Tata AIG Life Insurance
Insurance
Grace Period 15 days 31 days
Policy Administration Charge Rs. 60 per month Rs. 55 per month
10% on sum-assured after
Guaranteed Bonus Does not give
10 year
Loyalty Bonus 0.1% every year 0.25% after every 4th year
Total 24 free switches in a 4 free switches per year
Fund Switching Charge policy after this
after this Rs. 100 per Switch Rs. 250 per switch
30% of all premium
50% of all premium
Guaranteed Surrender value paid excluding 1st
paid excluding 1st premium
premium
0.80% per annum 1.75% per annum
Fund Management Charge
on the fund value on the fund value
Premium Redirection Charge Total 12 free Premium First 2 Premium
36
Redirection Redirection in a
in a policy after this Rs. 250 year is free after this Rs.
per Premium Redirection 1000
 per Premium Redirection

Last Year Return 42.70% 72%

We see that both the life insurance companies products are almost same. They have same
charges, fees and deductions. There is slightly difference in charges and maximum limits
of all charges are fixed by IRDA. Before buying any life insurance policy one should
check charges and fees on policy and companys overall performance and return 36

OBJECTIVES OF THE STUDY

To analysis the product details of HDFC Standard life Insurance Company

limited and Tata AIG life Insurance Company Limited.

To find Points of Parity and Points of Difference of HDFC Standard Life

Insurance Company Limited and Tata AIG Life Insurance Company Limited.

To find out factors that influence customers to purchase insurance policies and
give suggestions for further improvement.

37
 37
RESEARCH METHODOLOGY

RESEARCH:
According to Creswell who states - "Research is a process of steps used to collect and
analyze information to increase our understanding of a topic or issue". It consists of three
steps: Pose a question, collect data to answer the question, and present an answer to the
question.

TYPE OF DATA COLLECTED

There are two types of data used. They are primary and secondary data. Primary data is
defined as data that is collected from original sources for a specific purpose. Secondary
data is data collected from indirect sources. (Source: Research Methodology, By C. R.
Kothari)

PRIMARY SOURCES
These include the survey or questionnaire method, telephonic interview as well as the
personal interview methods of data collection.

SECONDARY SOURCES
These include books, the internet, company brochures, product brochures, the company
website, competitors websites etc, newspaper articles etc.

38
RESEARCH PROCESS
Sampling and determination of sample size
Sampling Plan: After deciding on the research approach and instruments, the marketing
researcher must design a sampling plan. This plan calls for three decisions:

1. Sampling Unit: Who is to be surveyed? The insuer researcher must define the
target population that will be sampled. The target population for our survey was
everyone aged 38

2. between 18 to 50 years belonging to socio economy class middle lower, middle

upper and upper class .Our sampling frame was Delhi.

2. Sample Size: How many people should be surveyed? Large samples give more reliable
results than small samples. However, it is not necessary to sample the entire target
population or even a substantial portion to achieve reliable results. A total of 50
interviews were conducted in Delhi region in different locations.

3. Sampling Procedure: How should the respondents be chosen? To obtain a

representative sample of the population, a probability sample of the population should be
drawn. Probability Sampling allows the calculation of confidence limits for sampling
error. Three types of probability sampling are described in following table, part A. When
the cost or time involved in probability sampling is too high, marketing researchers will
take Non probability sampling. Following table, part B, describes three types of non-
probability sampling. Some marketing researchers feel that non-probability samples are
very useful in many circumstances, even though they do not allow sampling error to be
measured.

A) Probability Sample:

Simple random sample - Every member of the population has an equal chance of
selection.
Stratified random sample - The population is divided into mutually exclusive group (such
as age groups), and random samples
39
are drawn from each group.
Cluster (area) sample -The population is divided into mutually exclusive groups (such as
city block), and the researchers draw a sample of the groups to interview.
B) Non Probability sample:

Convenience sample - The researcher selects the most accessible population member.
Judgment sample - The researcher selects population members who are good prospects
for accurate information.
39
Quota sample - The researcher finds and interviews a prescribed number of people in
each of several categories

I have conducted the convenient sampling in different areas in Delhi and NCR region.

Data source

To meet with consumers and asked to fill structured questionnaire and no secondary data
was collected.
Personal interviewing is the most versatile method. The interviewer can ask more
questions and record additional observations about the respondent, such as dress and
body language. Personal interviewing takes two forms. In arranged interviews,
respondents are contacted for an appointment.
Intercept interviews involve stopping people at a shopping mall or busy street corner and
requesting an interview.

Step 1:Collect the Information:

The data collection phase of marketing research is generally the most expensive and most
prone to error. The information collected should be both accurate and relevant as per as
the requirements of research project. Depending on the requirement, the researcher has to
work out a suitable data collection method.
40
Broadly data collection method can be classified into,
(a) Primary Method: when data is directly collected by a researcher, they are known as
primary methods e.g. interviews and questionnaires.
(b) Secondary Methods: The data are termed secondary data when they were not
originally collected for use in the research project under consideration, they were
collected rather for use by some other person or for some other project.
40

Step 2: Analyze the Information:

The next step in the marketing research process is to extract findings from the collected
data. The researcher tabulates the data and develops frequency distributions. Averages
and measures of dispersion are computed for the majorvariables. Theresearcher will also
apply some advanced statistical techniques and decision models in the hope of
discovering additional findings.

Step 3: Present the Findings:

As a last step of market research process, Results (findings) are extracted from the
Analysis of information and are presented to the related party. The researcher should
present major findings that are relevant to the major marketing decisions facing
management. The findings should be written in a concise, simple and objective orientated
language.
For the purpose of our project, the analyses were conducted on the basis of following
conditions. As we earlier suggested that we are going to categorize the scores into various
intervals. Now as we have attached scores to all the parameters according to their
importance .

41
 41

DATA ANALYSIS AND INTERPRETATION

Analysis is based on the responses, which I got from the different respondents. Each
question has its own outcome and my result based on these outcomes.
The analysis of the questionnaires is given below.
1.A SURVEY ON THE LIFE INSURANCEINDUSTRY IN INDIA

AGE NO. OF RESPONDANTS PERCENTAGE

18-25 Year 10 20%
26-35 Year 20 40%
36-49 Year 5 10%
50-60 Year 10 20%
More than 60 Year 5 10%
Total 50 100%

MORE THAN 60 YEAR; 10%; 10%

18-25 YEAR; 20%; 20% 18-25 YEAR
50-60 YEAR; 20%; 20% 26-35 YEAR
36-49 YEAR
50-60 YEAR
36-49 YEAR; 10%; 10%
MORE THAN 60 YEAR
26-35 YEAR; 40%; 40%
42
 42

INTERPRETATION:
From the chart above we find that 20% of the respondents fall in the age group of 18 25
years, 40% fall in the age group of 26 35 years and 10% fall in the age group of 36 49
years.

[Link] CLASSIFICATION OF SURVEYED RESPONDENTS

PARTICULARS NO. OF RESPONDANTS PERCENTAGE

FEMALE 20 40%
MALE 30 60%
TOTAL 50 100%

MALE; 60%

FEMALE; 40%

43
 43

INTERPRETATION

From gender classification female is 40% and male is 60%.

[Link] PROFILE OF SURVEYED RESPONDENTS

CUSTOMER PROFILE NO. OF RESPONDANTS PERCENTAGE

Student 5 10%
Housewife 5 10%
Working Professional 10 20%
Business 20 40%
Self Employed 5 10%
Government service 5 10%
employee
TOTAL 50 100%

44

44
 Government service employee; 10%; 10% Student; Student
10%; 10%
Self Employed; 10%;
Housewife;
10% 10%; 10% Housewife
Working Professional
Business
Working Professional; 20%; 20% Self Employed
Government service
Business; 40%; 40%
employee

INTERPRETATION:
From the chart above it can clearly be seen that 20% of the respondents are working
professionals, 10% are students and 40% are into business. Therefore the target market
would be working individuals in the age group of 18 25 years having surplus income,
interested in good returns on their investment and saving income tax.

[Link]. OF RESPONDENTS WHO HAVE LIFE INSURANCE POLICY IN THEIR

NAME
PERSON WHO HAVE NO. OF RESPONDANT PERCENTAGE
LIFE INSURANCE
POLICY
YES 30 60%
NO 20 40%
TOTAL 50 100%

45
45
 NO; 40%; 40%

YES
NO

YES; 60%; 60%

INTERPRETATION:
This graph shows that out of total 50 respondents only 30 or 60% respondents have life
insurance policy in their name. Rest all dont have a single policy in their name. So there
is a very big scope for life insurance companies to cover these people. So in future
business of life insurace will gro further.

[Link] SHARE OF LIFE INSURANCE COMPANIES

LIFE INSURER NO. OF RESPONDANTS PERCENTAGE

HDFC STANDARD LIFE 10 20%
BIRLA SUN LIFE 4 8%
AVIVA LIFE INSURANCE 6 12%
BHARTI AXA 2 4%
OTHERS 1 2%
TOTAL 50 100%
46

46
 HDFC STANDARD LIFE; 20% LIC; 20%

AVIVA LIFE INSURANCE; 12%

BAJAJ ALLIANZ; 10%
TATAICICI
AIG;PRUDENTIAL;
10% 10%
BIRLA SUN LIFE; 8%

ING VYSYA;
BHARTI
4%AXA; 4%
OTHERS; 2%

INTERPRETATION:
In India, the largest life insurance company is Life Insurance Corporation of India. It has
been in existence in India since 1956 and is completely owned by the Government of
India.6. ANNUAL PREMIUM PAID BY INDIVIDUALS FOR LIFE INSURANCE

PREMIUM PAID(P.A) NO. OF RESPONDANTS PERCENTAGE

Rs. 5000 - Rs. 10000 6 12%
Rs. 10001 - Rs. 15000 4 8%
Rs. 15001 - Rs. 24900 10 20%
Rs. 25000 - Rs. 50000 20 40%
Rs. 50001 - Rs. 60000 5 10%
Rs.60001 - Rs. 80000 0 0%
Rs. 80001 - Rs. 100000 5 10%
TOTAL 50 100%

47

47
 Rs. 5000 - Rs. 10000 Rs. 10001 - Rs. 15000
[Link].
80001 Rs. 15001 - Rs. 24900 Rs. 25000 - Rs. 50000
Rs. 50001 -- Rs.
Rs.5000
10001-Rs.
Rs.100000;
10000;
-60000;
Rs.
10%;
12%;
10%;
15000;
10%
12%
10%
8%; 8% Rs. 50001 - Rs. 60000
Rs. Rs. 15001
25000 - Rs.- Rs. 24900;
50000; 20%;
40%; 40%20% Rs.60001 - Rs. 80000
Rs. 80001 - Rs.
100000

INTERPRETATION:
From the chart above we find that, 12% of the respondents surveyed pay an annual
premium less than Rs. 10001 towards life insurance. 8% of the respondents pay an annual
premium less than Rs. 15001 and 20% pay an annual premium less than Rs. 25000.

[Link] LIFE INSURANCE PLANS

TYPE OF PLAN NO. OF RESPONDANTS PERCENTAGE

Term Insurance Plans 5 10%
Endowment Plans 5 10%
Pension Plans 10 20%
Child Plans 10 20%
Tax Saving Plans 20 40%
TOTAL 50 100%

48

48
 Term Insurance Plans; 10%; 10%
Endowment Plans; 10%; 10% Term Insurance Plans
Tax Saving Plans; 40%; 40% Endowment Plans
Pension Plans
Pension Plans; 20%; 20% Child Plans
Tax Saving Plans
Child Plans; 20%; 20%

INTERPRETATION:
From the chart given above we can clearly see that 10% of the respondents hold
endowment plans and 10% of the respondents hold term insurance plans. Endowment
plans are very popular and serve two purposes life cover and savings.
If the policy holder dies during the policy term the nominee gets the death benefit that is,
sum assured and accumulated bonus. On survival the policy holder receives the survival
benefit with a bonus.

[Link] OF UNIT LINKED INSURANCE PLANS

AWARENESS OF UNIT NO. OF RESPONDANTS PERCENTAGE

LINKED PLANS
YES 40 80%
NO 10 20%
TOTAL 50 100%

49
49
 NO; 20%; 20%

YES
NO

YES; 80%; 80%

INTERPRETATION:
From the chart given above we find that 80% of the respondents are aware of unit linked
life insurance plans and 20% are not aware of such plans. These plans should be
promoted through advertising. The company can advertise through television, radio,
newspapers, bill boards and pamphlets. This would increase awareness and arouse
curiosity in the minds of the consumer which would enable the company to market its
products more effectively.
[Link] WILLINGNESS TO SPEND ON LIFE INSURANCE PREMIUM

Willingness to spend on
premium No. of respondents Percentage
Less than Rs. 6,000 5 10%
Rs. 6,001 - Rs. 10,000 20 40%
Rs. 10,001 - Rs. 25,000 20 40%
Rs. 25,001 - Rs. 50,000 5 10%
Rs. 50,001 - Rs. 1,00,000 0 0%
TOTAL 50 100%
50

50
INTERPRETATION:
From the graph above, we can clearly see that 40% of the respondents would be willing
to spend between Rs. 10001 Rs. 25000 for life insurance. 40 % would be willing to
spend between Rs. 6001 Rs. 10000 per annum. Only 10% would be willing to spend
more than Rs. 25000 per annum as life insurance premium

LIMITATIONS

1. Difference in the opinion of the customers and the company..

2. Company is not willing to disclose full information.

3. Biased behavior of the respondents.

4. Sample size being small, may not reflect the opinion of major segment.
5. Time frame is limited.
6. Difficulty in analyzing the data because of multiple responses given by the
respondents.
51
 51

CONCLUSION

HDFC standard life insurance is first life insurance company in India. It has businesses
spread out across the globe. It was registered on 23 rd December 2000. It currently ranks
number 4 amongst the insurers in India (Source: annual premium provided by the
company)

The company faces a large amount of competition. To sustain itself it must promote its
products through advertising and improve its selling techniques. Consumers must be
aware of the new plans available at HDFC SLIC. The medium of advertising used could
be television since most of its competitors use this tool to promote their products. The
company must be promoted as an Indian company since consumers seem to have more
trust in investing in Indian firms.

The unit linked concept must be specifically promoted. The general perception of life
insurance has to change in India before progress is made in this field. People should not
be afraid to invest money in insurance and must use it as an effective tool for tax planning
and long term savings.

HDFC SLIC could tap the rural markets with cheaper products and smaller policy terms.
There are individuals who are willing to pay small amounts as premium but the plans do
not accept premiums below a certain amount. It was usually found that a large number of
males were insured compared to females. Individuals below the age of 30 (mostly male)
were interested in investment plans. This was a general conclusion drawn during
prospecting clients

52

52
 SUGGESTIONS

Advertise about the company and its products it motivates individuals to

purchase insurance

Create a positive perception about insurance

Speak about the good features a plan offers like high returns, life cover, tax
benefits, indexation, accident cover while prospecting customers

Try to sell the product/plan which the consumer requires and not the plan where
the advisors benefit is higher

Improve the efficiency in operations

Bring out policies with small premiums payable for short periods of time Rs.
5000 Rs. 10000 per annum for 10 years

Attract the youth of India with higher returns on investment as returns are the
motivating factor which influence purchase of insurance

Promote insurance in colleges and corporate houses

Promote HDFC SLIC as an Indian Company to build trust

HDFC SLIC could have a brand ambassador or a mascot to promote its services

Should have partial withdrawals from the first year onwards

53
Tap the rural market where there is large potential

Diversify product portfolio

 Make products more straight forward reduce complexities

53

BIBLIOGRAPHY

[Link]

[Link]

[Link]

[Link]

[Link] [Link]

[Link]

[Link]

Magazine 54

Insurance World
 The Outlook Money

Secrets of Successful Insurance Sales by Mr. Jack Kinder

Kothari.C.R. Research Methodology, 3rd edition,1997, Vikas Publications New

Delhi.

Mukherjee DD. : Retail lending, credit monitoring, documentation, and recovery

management, concept and practices, Snow White Publications, New Delhi

Nehriya R.N. : Corporate Risk Management, Distance Learning Department,

State Bank Staff College, Hyderabad. Varshney.P.N. , [Link] Banking
Law and Practice, 5th edition, Sultan Chand and Sons, New Delhi

QUESTIONNAIRE
Do you have a life insurance policy/investment plan in your name?

o Yes o No
o
o If yes which companys insurance policies do you hold?
o o Aviva Life Insurance
o HDFC Standard Life Insurance o Bajaj Allianz Life Insurance
o Birla Sun Life Insurance o LIC
o Tata AIG Life [Link] o ING Vysya Life Insurance
o ICICI Prudential Life Insurance o Bharti Axa Life Insurance
o Others (specify name)
o
o What is the approximate premium paid by you annually (in Rupees)?
o 55

o Rs. 5,000 Rs. 10,000 o Rs. 15,001 Rs. 25,000

o Rs. 10,001 Rs. 15,000 o Rs. 25,001 Rs. 50,000
o Rs. 50,001 Rs. 60,000 o Rs. 80,001 Rs. 1,00,000
o Rs. 60,001 Rs. 80,000
o More than Rs. 1,00,000 (specify premium)
o
o What kind of insurance policy would suit you best in your current stage of
life?
o Life Insurance o Pension Plans
o Life Insurance and Investment o Child Plans
Plans
o Tax saving plans
o
o
o
o
o
o Are you aware of the new unit linked insurance plans in the market?
o
o Yes o No
o
o How much would you be willing to spend per annum if you were to go for an
investment/insurance plan?
o
o Less than Rs. 6,000 o Rs. 25,001 Rs. 50,000
o Rs. 6,001 Rs. 10,000 o Rs. 50,000 Rs. 1,00,000
o Rs. 10,001 Rs. 25,000 o More than Rs. 1,00,000
o Which according to you is an ideal policy term? (Number of years you would
be willing to pay premium)
56
o
o 3 to 5 years
o 6 to 9 years
o 10 to 15 years
o 16 to 20 years
o 21 to 25 years
o 26 to 30 years
o More than 30 years
o Whole life policy
o
o What motivates you to purchase insurance/investment plans?
o
o Advertisements o Advice from friends
o High Returns o Family responsibilities
o Others (specify)
o
o
o
o
o
o In which kind of company would you prefer to make a purchase of
insurance?
o
o Government owned company o Private Company
o Public Limited Company o Foreign based company
o
o
o
o Typically what kind of returns would you look at from your investments?
(Please note: Higher returns involve greater risk)
57
o
o Less than 5% o 11% - 15 %
o 6% - 10 % o 16% - 20 %
o 21% - 25% o 41% - 50%
o 26% - 30% o More than 50%
o 31% - 40%
o
o Personal Details:
o
o Name:
o
o Address:
o
o Age: o Contact No. :
o
o Profile of respondent:
Student Business
Housewife Self Employed
Working Professional Government Service Employee

58