PROJECT REPORT ON BUYING BEHAVIOUR OF CUSTOMERS (INSURANCE SECTOR)

SUBMITTED BY SHAHBAS MOIDUNNI M.K

DCSMAT BUSINESS SCHOOL PGDM 10-12 PGP10051

ACKNOWLEDGEMENT

I am very thanking IDBI FEDERAL LIFE INSURANCE CO. Ltd. for allowing me to do this project.

I am really thanking Shanti madam and Kavitha madam for helping me through this project.

I would like to thank DCSMAT placement coordinator Mukesh Dev sir forgetting me an opportunity to do my summer internship in this company and B.K Menon sir for being my faculty guide in this internship.

I would like to thank my companion in doing this internship MD Manzoorul Haque for his support in doing this project work and fellow companions in IDBI FEDERAL LIFE INSURANCE Co. Ltd. who did their internship along with me.

I would like thank people who cooperated by giving their support and filling up the questionnaires for me.

SHAHBAS MOIDUNNI M.K

DECLERATION
I hereby declare that all the information collected and presented for the project entitled BUYING BEHAVIOUR OF CUSTOMERS (INSURANCE SECTOR) knowledge. are true and correct to my

SHAHBAS MOIDUNNI M.K

EXECUTIVE SUMMARY

My summer internship helped me in gaining a beginners experience in the real corporate world. My project is on the topic BUYING BEHAVIOUR OF CUSTOMERS (INSURANCE SECTOR) for that I collected data both primary and secondary data s I had collected filled up questionnaires from a sample size of 200, I had collected mostly from my native place and surroundings in Kerala.

This summer internship helped me to understand how an insurance company runs. The government s interventions and their share in insurance companies are hereby learned.

The success of an insurance company highly depends upon their agents and the advertisements they are doing and the design of the policy or product offered by the company.

CONTENTS
1. Industry profile ..6 2. Company profile 11 3. Competition analysis .17 4. Objective of study 20 5. Introduction to buying behaviour of customers 21 6. Process or methodology of study ..24 7. Limitations of the study 25 8. Data analysis 27 9. Suggestions 34 10. Conclusion ..........36 11. Bibliography ..38 12. Questionnaire ..39

1. INDUSTRY PROFILE

With such a large population and the untapped market area of this population Insurance happens to be a very big opportunity in India. Today it stands as a business growing at the rate of 15-20 per cent annually. Together with banking services, it adds about 7%to the country s GDP .In spite of all this growth the statistics of the penetration of the insurance in the country is very poor. Nearly 80% of Indian populations are without Life insurance cover and the Health insurance. This is an indicator that growth potential for the insurance sector is immense in India. It was due to this immense growth that the regulations were introduced in the insurance sector and in continuation Malhotra Committee was constituted by the government in 1993 to examine the various aspectsof the industry. The key element of the reform process was Participation of overseasinsurance companies with 26% capital. Creating a more efficient and competitivefinancial system suitable for the requirements of the economy was the main idea behindthis reform. Since then the insurance industry has gone through many sea changes. The competition LIC started facing from these companies were threatening to the existence of LIC. Since the liberalization of the industry the insurance industry has never looked back and today stand as the one of the most competitive and exploring industry in India. The entry of the private players and the increased use of the new distribution are in the limelight today. The use of new distribution techniques and the IT tools has increased the scope of the industry in the longer run.

The Indian Life Insurance company act 1912 was the first statutory body that started to regulate the life insurance business in India. By 1956 about 154 Indian, 16 foreign and 75 provident firms were been established in India. Then the central government took over these companies and as a result the LIC was formed. Since then LIC has worked towards spreading life insurance and building a wide network across the length and the breath of the country. After the liberalization the entrance of foreign players has added to the competition in the market. Insurance Sector Reforms In 1993, Malhotra Committee, headed by former Finance Secretary and RBI Governor was formed to evaluate the Indian insurance industry and give its recommendations. The committee came up with the following major provisions y Private Companies with a minimum paid up capital of Rs.1bn should be

allowed to enter the industry. y Foreign companies may be allowed to enter the industry in collaboration

with the domestic companies. y Only one State Level Life Insurance Company should be allowed to operate

in each state.

It was after this committee came into effect the regulatory body for insurance sector was formed with the name of IRDA. Insurance Regulatory and Development Authority (IRDA): The IRDA since its incorporation as a statutory body has been framing regulations and registering

the private sector insurance companies. IRDA being an independent statutory body has put a framework of globally compatible regulations.

Impact of Liberalization The introduction of private players in the industry has added to the colours in the dull industry. The initiatives taken by the private players are very competitive and have given immense competition to the on time monopoly of the market LIC. Since the advent of the private players in the market the industry has seen new and innovative steps taken by the players in this sector. The new players have improved the service quality of the insurance. As a result LIC down the years have seen the declining phase in its career. The market share was distributed among the private players. Though LIC holds the 75% of the insurance sector but the upcoming natures of these private players are enough to give more competition to LIC in the near future. LIC market share has decreased from 95% (2002-03) to 63.95 %( 2010-11) and now it is further decreasing. THE WORKING OF INSURANCE COMPANY
Profit = Earned Premium + Investment Income Incurred Loss Underwriting expenses

Insurers make money in two ways: 1. Through Underwriting, the processes by which insurers select the risks to insure and decide how much in premiums to charge for accepting those risks, and 2. By investing the premiums they collect from insured.

y Revenue = Premium y Expenses = (Sum of Claims + Commission payable on procurement of business + Operating expenses) y Operating Surplus = (Revenue Expenses)

Net investment income includes income from trading in and holding stock market securities including government securities, special deposits with the central government, loans to several public utilities and service providers in state government. Insurance premium collected is converted in a pool of fund then divided in to four expenses: y To pay the expenses of the management y To pay agency commission y To pay for the claims y Surplus money will be invested in govt. securities

Current Scenario of the Industry India with about 200 million middle class household shows a huge untapped potential for players in the insurance industry. Saturation of markets in many developed economies has made the Indian market even more attractive for global insurance majors. The insurance sector in India has come to a position of very high potential and competitiveness in the market. Innovative products and aggressive distribution have become the say of the day. Indians, have always seen life insurance as a tax saving device, are now suddenly turning to the private sector that are providing them new products and variety for their choice. Life insurance industry is waiting for a big growth as many Indian and foreign companies are waiting in the line for the green signal to start their operations. The Indian consumer should be ready now because the market is going to give them an array of products, different in price, features and benefits. How the customer is going to make his choice will determine the future of the industry. The private insurance players have significantly improving their market share when compared to 50 years Old Corporation (i.e. LIC).

2. COMPANY PROFILE

IDBI FEDERAL Life insurance co. ltd. is one of the major players in the insurance market.it is a joint-venture of IDBI Bank which is India s premier development and commercial bank, Federal Bank which is one of India s leading private sector banks and Ageas which is a multinational insurance giant based out of Europe. In this venture, IDBI Bank owns 48% equity while Federal Bank and Ageas own 26% equity each. At IDBI Federal, we endeavour to deliver products that provide value and convenience to the customer. Through a continuous process of innovation in product and service delivery we intend to deliver world-class wealth management, protection and retirement solutions to Indian customers. Having started in March 2008, in just five months of inception IDBI FEDERAL Life insurance co. ltd became one of the fastest growing new insurance companies to garner Rs. 100 Cr in premiums. The company offers its services through a vast nationwide network across the branches of IDBI Bank and Federal Bank in addition to a sizeable network of advisors and partners. As on April 30th 2011, the company has issued over 2.94 lakh policies with over Rs. 16, 499 Cr in sum assured

Management: GV Nageswara Rao is the MD & CEO of IDBI Federal Life Insurance. Aneesh Srivastava is the CIO of IDBI Federal Life Insurance. Michael J Wood is the appointed actuary of IDBI Federal Life Insurance.

About the sponsors of IDBI Federal Life Insurance Co Ltd

48%+

2 6 % + 26% =

100%

IDBI Bank Ltd. continues to be, since its inception, India s premier industrial development bank. Created in 1956 to support India s industrial backbone, IDBI Bank has since evolved into a powerhouse of industrial and retail finance. Today, it is amongst India s foremost commercial banks, with a wide range of innovative products and services, serving retail and corporate customers in all corners of the country from 841 branches and 1387 ATMs. The Bank offers its customers an extensive range of diversified services including project financing, term lending, working capital facilities, lease finance, venture capital, loan syndication, corporate advisory services and legal and technical advisory services to its corporate clients as well as mortgages and personal loans to its retail clients. As part of its development activities, IDBI Bank has been instrumental in sponsoring the development of key institutions involved in India s financial sector National Stock Exchange of India Limited (NSE) and National Securities Depository Ltd, SHCIL (Stock Holding Corporation of India Ltd), CARE (Credit Analysis and Research Ltd).

Federal Bank is one of India s leading private sector banks, with a dominant presence in the state of Kerala. It has a strong network of over 744 branches and 810 ATMs spread across India. The bank provides over four million retail customers with a wide variety of financial products. Federal Bank is one of the first large Indian banks to have an entirely automated and interconnected branch network. In addition to interconnected branches and ATMs, the Bank has a wide range of services like Internet Banking, Mobile Banking, Tele Banking, and

Any Where Banking, debit cards, online bill payment and call centre facilities to offer round the clock banking convenience to its customers. The Bank has been a pioneer in providing innovative technological solutions to its customers and the Bank has won several awards and recommendations.

Ageas is an international insurance company with a heritage spanning more than 180 years. Ranked among the top 20 insurance companies in Europe, Ageas has chosen to concentrate its business activities in Europe and Asia, which together make up the largest share of the global insurance market. These are grouped around four segments: Belgium, United Kingdom, Continental Europe and Asia and served through a combination of wholly owned subsidiaries and partnerships with strong financial institutions and key distributors around the world. Ageas operates successful partnerships in Belgium, UK, Luxembourg, Italy, Portugal, China, Malaysia, India and Thailand and has subsidiaries in France, Germany, Hong Kong and UK. It is the market leader in Belgium for individual life and employee benefits, as well as a leading non-life player, through AG Insurance, and in the UK, it has a strong presence as the second largest player in private car insurance and the over 50 s market. It employs more than 13,000 people and has annual inflows of almost EUR 18 billion. PRODUCT PORTFOLIO Being a new entrant, IDBI is slowly increasing its portfolio which includes: Retirement Plan: With rising inflation, it s absolutely necessary to make provisions for the future which makes retirement plan an important financial decision. Better known as Pension plan, this plan takes care of financial needs after retirement by investing a part of your savings for limited period. Pension plan provides steady income after retirement and takes care of daily needs. The pension plan offered by IDBI Federal is Retiresurance. Term Plan:A risk plan which provides comprehensive cover for your family in the unfortunate event of untimely demise. A term life insurance plan provides good cover at relatively nominal cost and has no survival benefits. IDBI Federal Life term plan is Termsurance.

Investment Plan: Popularly known as ULIP, an investment plan invests part of your savings in equity or debt market as per your preference. The objective of investment plan is to give you returns which easily beat the rising costs since the usual returns in a bank are extremely low. ULIP s offered by IDBI Federal Life are Wealthsurance, Bondsurance and Incomesurance. Health Plan: Slightly different from health insurance, health plan provides cover for surgery costs, critical illness. A lump sum is paid irrespective of actual hospital bill. Healthsurance is IDBI Federal Life s health plan.

IDBI Federal Life Insurance Product Table: Retirement/Pension Plan Term Plan Savings & Investment Plan Savings & Investment Plan Savings & Investment Plan Health Plan Retiresurance Termsurance Wealthsurance Bondsurance Incomesurance Healthsurance

Financial Information:
The total premium earned for the half year ended September 30, 2010 was Rs.3427 million. The profit after tax for the same period is Rs.513 million. There

have been 132 death claims reported during the period out of which 43 claims were settled and 19 claims were rejected.

VISION AND VALUES

Maintaining integrity through our values

IDBI FEDERAL LIFE INSURANCE Co. Ltd. s Vision

To be the leading provider of wealth management, protection and retirement solutions that meets the needs of our customers and adds value to their lives.

IDBI FEDERAL LIFE INSURANCE Co. Ltd. s Mission

y To continually strive to enhance customer experience through innovative product offerings, dedicated relationship management and superior service delivery while striving to interact with our customers in the most convenient and cost effective manner.

y To be transparent in the way we deal with our customers and to act with integrity.

y To invest in and build quality human capital in order to achieve our mission.

IDBI FEDERAL LIFE INSURANCE Co. Ltd. sValues y Transparency: Crystal Clear communication to our partners and stakeholders y Value to Customers: A product and service offering in which customers perceive value y Rock Solid and Delivery on Promise: This translates into being financially strong, operationally robust and having clarity in claims y Customer-friendly: Advice and support in working with customers and partners y Profit to Stakeholders: Balance the interests of customers, partners, employees, shareholders and the community at large

Marketing Campaigns: IDBI Federal Life recently launched television commercials focusing on its frontline products Wealthsurance and Incomesurance. The campaign taglines are Jisne bhi suna khareed liya and Guaranteed Income Ki Bhavishavani Whereas the first advertisement reflects that the product is

so great that whoever hears about it, buys it instantly, the second advertisement promises to be clear and transparent on the issue of returns in the investment product. IDBI Federal has also introduced two animation characters by the name of Happy and Lucky to promote the brand.

3. COMPETITION ANALYSIS
IDBI FEDERAL LIFE INSURANCE Co. Ltd. is in a highly competitive segment i.e., insurance sector they are having large number of rival companies fighting along with them in taking control of the industry.

y Threat of intense segment rivalry- The major plus point for IDBI FEDERAL LIFE INSURANCE Co. Ltd. is the brand value of its partners. The competition in this market is a very difficult or tough you could say we can refer this intense competition as Cut throat competition or Red ocean competition market. The market condition is oligopoly where a few number of big competitors are providing identical product and services differing only in quality of them. Each competitor has their own trademark attribute, they are finding that attribute and charging for that particular attribute. As we know LIC s attribute is their hold in rural market. But when we say about population growth, economic growth, or government policies insurance segment is very attractive because only 25% insurable

person are insured secondly 80% population are under age of 45. The competitorsof IDBI FEDERAL LIFE INSURANCE Co. Ltd. are o o o o o o o o o o o o o o o o o o o o o o o Life Insurance corporation of India Bajaj Allianz life insurance company HDFC standard life insurance Co. Ltd. Birla Sun Life ICICI Prudential life insurance Co. Ltd. ING vysya life insurance Co. Ltd. Max New York life insurance Co. Ltd. Met life India insurance Co. Kotak Mahindra old mutual life insurance Ltd. SBI Life insurance Co. Ltd. TATA AIG Life insurance company Limited Reliance life insurance company limited Aviva life insurance Co. Pvt. Ltd Sahara India life insurance Co. Ltd Sriram Life insurance Co. Ltd Bharati AXA life Insurance Co. Ltd. Future general life insurance company Ltd. IDBI Fortis life insurance company Ltd. Canara HSBC Oriental Bank of Commerce life insuranceCo. Ltd. AEGON Religare Life insurance Co. Ltd. Dlf Pramaerica Life insurance Co. Ltd. Star Union Dai-ichi life insurance Co. Ltd. Andhra BOB Legal General life insurance Co. Ltd.

LIC has many resources and it has above 50-year experience in insurance field but has only 3 year experience in market. However, due to AGEAS s experience,FEDERAL BANK S and IDBI s brand value, IDBI FEDERAL LIFE INSURANCE Co. Ltd. had made a good position in the market with this comparatively short period of time. Likewise many companies alike IDBI FEDERAL LIFE INSURANCE Co. Ltd. are facing threat from LIC if India to this

reason price war, advertisement, and new product innovation will be expensive in future.

y Threat of new entrance- Due to aggressive competition and high entry exit barrier, this is not attractive segment for new player. For entering in insurance field, mandatory capital is 100 crores. Secondly, foreign stake limited with 26%, third Indian company have no experience in insurance business. Exit barrier are also very high because, no company can leave market after entering due to loss because firstly, 100 crores will be lost secondly, their compensation (customer or other company) will be very high or more than deposited money. So in long run, company will try to less their business but they will not leave market. So this is good factor for IDBI FEDERAL LIFE INSURANCE Co. Ltd. Because, where entry or exit barrier are high, profit potential are also high.

y Threat of substitute product- This is not attractive market in view of substitute goods because there is many substitute in market but only service style is different. Different insurance company provide at least same product but presentation is different. In case of lower substitute (means investment purpose) many product in India for example, share, mutual fund, fixed deposit. Substitute place a limit on price and on profit.

y Threat of buyer s growing power- In India buyer s growing power are increasing because they have more concentrated or organized towards market. Government has established insurance regulator (IRDA) in India for growing buyer s barging power. Due to lowest switching, buyers are very price sensitive and buyers have many sources for knowing about different company product. Due to education buyer can analysis that, which product is good for him. So due to growing buyer s power this segment is not good for new player.

y Threat of supplier s growing power- Due to oligopoly market condition insurance company cannot raise price but they can increase their profit from selling more policies in market. In India, supply-growing power (agent, broker, bank assurance) are growing due to lot of company availability in India and this is not good for IDBI FEDERAL LIFE INSURANCE Co. Ltd.

4. OBJECTIVE OF STUDY

The objective of this study is to understand better about the insurance sector, which is the fast growing business in India. y Proper understanding & analysis of life insurance industry.

y To conduct market surveys on a sample selected from the entire population and study the consumers buying behaviour.

y As large insurance market is still untapped so based on the survey the potential of the Indian market can be evaluated.

y New distribution channel and marketing strategies can be evaluated based on the awareness among the masses regarding IDBI FEDERAL LIFE INSURANCE Co. Ltd.

5. INTRODUCTION TO BUYING BEHAVIOUR OF CUSTOMERS

Customer loyalty is one of the main business challenges, also for the insurance sector. Here the conceptual framework for studying this problem in insurance and propose a methodology to address it. With a methodological approach, it is possible to estimate the probability that a household with more than one insurance contract (policy) in the same insurance company (cross-buying) would cancel all policies simultaneously. For those who cancel part of their policies, but not all of them, and estimate the time they are going to stay in the company after that first policy cancellation, that is to say, the time the company has to try to retain a customer who has just given them a clear signal of leaving the com pany. Additionally, discuss the results obtain when applying our methodology to a policy cancellation dataset provided by a Danish insurance company, and we outline some conclusions regarding the factors associated to a higher or lower customer loyalty. IDENTIFICATION OF FACTORS AFFECTING BUYING BEHAVIOR Consumer behaviour is the study of how individuals, groups, and organizations select, buy, use and dispose of goods, services, ideas, or experiences to satisfy their needs and wants. With respect to financial products from an insurance company the consumer behaviour is not clearly defined.Consumer behaviour for services generally vary from that of products, however when it comes to financial products the available literature on buying behaviour falls short.The aim of this project is to identify all possible factors which influence consumers one way or the other with respect to IDBI Federal Life Insurance Co Ltd financial products.

To accomplish this task the methodology used and schedule of events is described later on in this report. LITERATURE SURVEY 1. Historically the factors affecting consumer behaviour have been broadly classified as: y y y Cultural Factors Social Factors Personal Factors

For financial products however we can t use this framework, we can say that buying of insurance can be attributed to Personal Factors, but these also include the concepts of PERSONALITY and SELF-CONCEPT which do not explain the buying behaviour of insurance. 2. The motivational theories of consumer behaviour which have been formulated are: y y y FREUD S Theory MASLOW S Theory HERZBERG S Theory

However, none of these theories give valuable insight when it comes to motivation for buying financial products. 3. The Five-Stage Buying Decision Model is widely accepted as a basic framework for the consumer behaviour:

y y y y y

Problem Recognition Information Search Evaluation of alternatives Purchase Decision Post purchase Behaviour

It is known that consumers do not always pass through all five stages in buying a product; they might skip or reverse some. Keeping this in mind we can say this model is helpful to get a basic idea of how consumers buy financial products. The information sources are vital in educating the consumers and this can be done through Personal, Commercial and Public Sources. The evaluation of alternatives however can t be explained for financial products. There is no information available as to how people filter out alternatives when it comes to deciding on a particular financial product offering

4.

Elaboration Likelihood Model

Richard Petty and John Cacioppo s model of attitude formation and change describes how consumers make evaluations in both low- and high- involvement circumstances. They describe the Central Route where attitude formation is based on diligent, rational consideration of the most important product information; and the Peripheral Route where attitude formation is due to association with some positive or negative peripheral cues which include celebrity endorsement as well as insurance agents. This particular model gives a basic idea as to how people may develop attitudes towards insurance products. The central route will not differ as the products offered in this industry are tailored to suit the needs of the consumer. The peripheral cues are the most important as the brand name; advertisements, agents etc. play an important role in attitude formation for the consumer. It would thus be helpful to understand all these cues in order to create favourable attitude towards IDBI Federal Financial Products. 5. Low-Involvement Marketing Strategies

One type of Low-Involvement Marketing Strategy is to design advertising to trigger strong emotions related to personal values or ego-defence. This

can be observed in the insurance industry as most advertisements are designed in order to trigger feelings of uncertainty which can be quelled by purchase of an insurance product.

6. PROCESS OR METHODOLOGY OF STUDY

PROCEDURE:

The procedure that followed enlisted below: y Studying the product y Decision on objective needed to be work on. y Developing Survey instruments y Getting questionnaire filled through interacting with different age groups, sex, monthly income and occupation. y Finally analysing the data of various areas and trying to study about various influence factors.

PROCESS ADOPTED:

Gaining knowledge about the product

Reading about the product was the first step undertaken. This gave not only in depth knowledge about what is been offered by the insurance but also proved useful while developing the questionnaire.

Customer Survey

The survey is important tool as clear perception of people about the product can be estimated and known. The need levels of the people regarding the insurance product been observed through survey. It was very useful in knowing about the requirements of the people. I had done my data collection majority of the data collected are from my home town in Kerala. I managed to collect 200 filled up questionnaires from the people the sample population consists of students, teachers, bank employees, doctors, officeexecutives, almost every kind of people.

7. LIMITATIONS OF STUDY
Some of the difficulties and limitations faced during my training are as follows: y Lack of awareness among the people This is the biggest limitation

found in this sector. Most of the people are not aware about the importance and the necessity of the insurance in their life. y Perception of the people towards Insurance sector People still

consider insurance just as a Tax saving device. So today also there is

always a rush to buy an Insurance Policy only at the end of the financial year. y Insurance does not give good returns Still today people think that

Insurance does not give good returns. They are not aware of the modern Unit Linked Insurance Plans which are offered by most of the Private sector players. They are still under the perception that if they take Insurance they will get only 5-6% returns. Nowadays most of the modern Unit Linked Insurance Plans gives returns which are many times more than that of bank Fixed deposits, National saving certificate, and PPF. y Lack of awareness about the earning opportunity in the Insurance sector People still today are not aware about the earning opportunity

that the Insurance sector gives. Companies in order to beat the competition and to increase their Insurance Advisors and increase their reach to the customers are giving very high commission but people are not aware of that. y Increased competition Today the competition in the Insurance sector has become very stiff. Currently there are more than 20 Life Insurance companies working in India. Today each and every company is trying to increase their Insurance Advisors so that they can increase their reach in the market. This situation has created a scenario in which to recruit Life insurance Advisors and to sell life Insurance Policy has become very difficult.

8. DATA ANALYSIS
The data analysis and general interpretation of customers on the basis of questionnaires filled up from a sample population of 200.

1. The best investment option

BANK DEPOSIT 66%

Out of 200 sample population 133 opted bank deposit as investment option, 32 opted mutual fund, 23 opted shares and debentures, 8 opted financial products, 3 gone for post office savings and 1 opted others.

UTUAL FUNDS 16%

FINANCIAL PRODUCTS 4%
POST OFFICE SAVINGS 2% OTHERS 1%

SHARES AND DEBENTURES 11%

2. Distribution of insured and uninsured among sample population

UN INSURED 43%

INSURED 57%

From this chart we are able to understate that among 200 sample population 115are insured and 85 are uninsured.

3. No. of insured in LIC and other insurance companies

OTHERS 22%

LIC 78%

From this pie chart out of 115 insured people 90 are insured by LIC of India and rest by other companies in which none is insured by IDBI FEDERAL LIFE INSURANCE Co. Ltd.

4. No. of people ranking the features they consider while taking a policy The features were;

a) b) c) d) e)

Insurance coverage High returns Low premium amount Flexible withdrawals Risk involved

AGREE 51%

NEITHER AGREE OR DISAGREE 15%

DISAGREE 2% STRONGLY DISAGREE 1%

STRONGLY AGREE 31%

From the survey taken from the sample size of 200; 103 of the population agreed that these are the feature they looks upon while taking an insurance policy,63 of these people strongly agreed , 30 neither agree nor disagree , 3 of them disagreed and 1 person strongly disagreed 5. Awareness of IDBI FEDERAL LIFE INSURANCE Co. Ltd. products among public.

AWARE 34% NOT AWARE 66%

Out of 200 people 131 responded that they are unaware of IDBI FEDERAL LIFE INSURANCE Co. Ltd. and its products and 69 of them responded they are aware of IDBI FEDERAL LIFE INSURANCE Co. Ltd.

6. Preferred mode of payment opted

HALF YEARLY 46%

ANNUAL 54%

From the samples collected out of 200, 108 opted annual payment as their opinion and the remaining 92 of them opted for half yearly payment.

7. Whether the company in which they provide insurance

I E T I E 68 32

From study conducted it was revealed that out of 200 samples collected 134 are not enjoying the insurance coverage provided by the company meanwhile 64 are provided insurance coverage from the company.

9. SUGESSIONS y
People were having good knowledge about insurance companies because of the advertisements and through agent each and every individual I met was at least visited by an insurance agent. The comparatively new player in insurance sector like IDBI FEDERAL LIFE INSURANCE Co. Ltd. must advertise well enough to reach most of the people, because the prospective insurance customer will always look for brand name. So, the IDBI FEDERAL LIFE INSURANCE Co. Ltd. must look forward to increase their brand image.

IDBI FEDERAL LIFE INSURANCE Co. Ltd. is highly concentrating on the high income segment of the overall population .Majority of the population consists of middle or lower income population IDBI FEDERAL LIFE INSURANCE Co. Ltd. so it advisable that IDBI FEDERAL LIFE INSURANCE Co. Ltd. must come up with marketing strategies which is useful for getting the attention of general public. The LIC of India has the upper hold in this segment which is almost unnoticed by IDBI FEDERAL LIFE INSURANCE Co. Ltd.

y Only a minute percentage of population in India is insured compared to

other developed countries like USA which comes up to 45% of population .There are millions of people who are to be insured so, IDBI FEDERAL LIFE INSURANCE Co. Ltd. must take necessary strategies to insure the uninsured.

y Group insuring of companies will give a large number of policies and

individuals explored.

y The rural areas are containing more population than urban areas in India
IDBI FEDERAL LIFE INSURANCE Co. Ltd. must take adequate strategies to make this rural population aware of this company and get their trust by training and appointing agents from rural areas so that the trust will automatically come to the company as well as policies. The current plans of IDBI FEDERAL LIFE INSURANCE Co. Ltd. are not reachable or affordable to these segments of population. There are large amount of prospective high income group in rural areas.

y In today s corporate world customer satisfaction is the key element to

earn profit and run the business. So the best service should be given before and after the commencement of the policy. CRM must be taken into high stake of importance to the companies policies.

y Better service quality should include-issuing policy on time, providing

claims on time, proper communication via mail or courier on timely basis to aware customer about the policy status.

y In insurance, process is too much time taking, when we compare to other financial tools, so process work should be less, effective and flexible.

y People are not much aware of alternative policy scheme (health, diabetics), so there are need to increase awareness of such type of policies among people. y Mostly, people are not satisfied from the post service of insurance companies due to dependence on agents or no knowledge about process, so there should be need to increase awareness about self-service and awareness among people by training and advertisement

10.CONCLUSION
y People were having good knowledge about insurance companies because of the advertisements and through agent each and every individual I met was at least visited by an insurance agent. The comparatively new player in insurance sector like IDBI FEDERAL LIFE INSURANCE Co. Ltd. must advertise well enough to reach most of the people, because the prospective insurance customer will always look for brand name. So, the IDBI FEDERAL LIFE INSURANCE Co. Ltd. must look forward to increase their brand image.

y People are starting to believe in insurance companies apart from LIC India Ltd. which most of the public thinks is a government run company.

y People in general have been influenced by the marketing activities of insurance companies. A high penetration of print, radio and TV ad campaigns over the years is beginning to have its impact now.

y Another important trend was in terms of people viewing insurance as a tax saving and investment instrument as much as protective one.

y The general satisfaction levels among public with regards to policy and agents still requires improvement. Here lies the opportunity for a relatively new comer like IDBI FEDERAL LIFE INSURANCE Co. Ltd.

y LIC has never been known for prompt service or customer oriented methods but IDBI FEDERAL LIFE INSURANCE Co. Ltd.can build its reputation based on these factors.

11. BIBLIOGRAPHY
y
y

y y y y
y y y

acadjournal.com idbifederal.com policybazaarinsurance.blogspot.com iloveindia.com insurancevino.blogspot.com opppapers.com en.wikipedia.org google.com scribd.com

QUESTIONNARE
Dear Sir/Madam, I am Shahbas Moidunni m.k doing this survey as a part of my Summer Internship Project. I will be extremely grateful if you could spare a valuable minute of yours. All the information given will be used only for academic purpose and it will be confidential: -

1. NAME -

___________________________________________________________________ Sex :- Male Female

2. Date Of Birth - ________________

3. ADDRESS ______________________________________________________________________________________ __ ______________________________________________________________ 4. TELEPHONE - +91________________________________________________________________ 5. Which is the best investment option? a. Shares and debentures. b. Bank Deposits. c. Mutual Funds. d. Financial Products. e. Post Office Savings. f. Others. 6. Do you own an insurance policy? a. Yes b. No If yes, please mention which company policy you own _____________________________________________________________________

7. Following are the features you consider before taking an insurance policy? y Insurance Coverage y High Returns y Low premium amount y Flexible Withdrawals

a. b. c. d. e.

y Risk Involved Strongly Agree Agree Neither Agree nor Disagree Disagree Strongly Disagree

8. Are you an account holder in any bank? If yes, please specify the bank and type of account ___________________________________________________________________________ _____________ ______________________________________________________________

9. Are you aware of IDBI Federal Life Insurance Co Ltd products? a. Yes b. No 10. Do you have any insurance policy ofIDBI Federal Life Insurance Co Ltd? a. Yes b. No If yes, please mention which plan does you own___________________________________ 11. What would be your preferable mode of premium payment? a. Annual mode of premium payment. b. Half Yearly mode of premium payment. 12. Does the company in which you work provide you insurance? a. Yes b. No 13. Your Valuable Feedback_________________________________________________________________________________ ________________________________________________________________________________________ _________________________________________________

DATE:

SIGNATURE