ICFAI BUSINESS SCHOOL, DEHRADUN

“COMPARATIVE ANALYSIS OF DIFFERENT LIFE

INSURANCE PRODUCTS BASED ON CUSTOMER’S INCOME
POTENTIAL AND AGE GROUP”

Santanu Chowdhury

2009

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RELIGARE INSURANCE BROKING LIMITED
 A REPORT

ON

COMPARATIVE ANALYSIS OF DIFFERENT LIFE INSURANCE

PRODUCTS BASED ON CUSTOMER’S INCOME POTENTIAL AND AGE
GROUP

BY
Santanu Chowdhury
Enrollment No: 08BSDDU0104

Name of the Organization: Religare Insurance Broking Limited.

Date of Submission: 23rdMay, 2009

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 Authorization

This summer internship program has been conducted for partial fulfillment of
MBA-program at IBS-Dehradun. Summer Internship Program also included a
project work on “COMPARATIVE ANALYSIS OF DIFFERENT LIFE
INSURANCE PRODUCTS BASED ON CUSTOMER’S INCOME POTENTIAL
AND AGE GROUP”

Religare Insurance Broking Limited-Dehradun and ICFAI Business School-

Dehradun hereby authorize Mr. Santanu Chowdhury to conduct his research
dissertation under Mr. Pushkar Saxena, Branch Manager, Religare Insurance
Broking Limited and Prof. Bhupinder Singh, Faculty, Icfai Business School
starting from date: 24th February, 2009 to 23rd May, 2009.

A complete report of research findings will have to be provided to Religare

Insurance Broking Limited- Dehradun.

Signature: ……………. …. Signature…………………

Mr. Pushker Saxena Prof. Bhupinder Singh

(Branch Manager-RIBL) (Faculty Member-IBS-Dehradun)

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“No one who achieves success does so without acknowledging the
help of others. The wise and confident acknowledge this help
with gratitude.”
The Summer Internship Program (SIP) is proving to be extremely rewarding
experience for me in terms of learning and industry exposure.
I would like to extend my deepest gratitude to my company guide Mr. Pushker
Saxena, Associate Business Development Manager Sales–Religare Insurance
Broking Limited, Dehradun who gave his valuable time & guidance in every step
of my project. He was like a mentor for me during these 8 weeks of the Internship
program giving me valuable inputs and much need sales exposure.
I would like to thank my faculty guide Prof. Bhupinder Singh, Icfai Business
School who gave his valuable inputs in preparation of the questionnaire for market
research survey and preparation of the report.
I would like to thank another mentor of mine Mr. Ashok Thapa (Relationship
Manager) and Mr. Sumit Mahendru (Associate Business Development Manager,
RIBL) who constantly gave their suggestions & shared valuable insights in making
my report effective and also for sharing some confidential data which is very
important to make my project stronger.
I would also like to thank my colleagues who are worked with me during the
internship in RIBL for their cooperation & support during the entire period.

Name: Santanu Chowdhury

Enrollment No: (08BSDDU0104)

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 Table of Contents
Authorization ..................................................................................... Error! Bookmark not defined.

Abstract: ........................................................................................................................................... 7

STAGES OF ADOPTION PROCESS: ....................................................................................................... 9

Work till date: ............................................................................................................................... 10

INTRODUCTION: ................................................................................................................................... 11
Insurance in India an overview with years .......................................................................... 12

Regulatory body: .......................................................................................................................... 14

Insurance Regulatory & Development Authority.................................................................................... 14
CHARACTERISTICS OF INSURANCE INDUSTRY: ............................................................................... 15

Essential Features of Insurance:- ......................................................................................... 16

Benefits/Function of insurance: .............................................................................................. 17
Reasons for buying Insurance policy: ................................................................................... 18
PEST analysis of Insurance Industry: .................................................................................................... 20
ECONOMIC IMPACT ............................................................................................................................. 21

Indian Insurance Industry Growth and Inflation .............................................................. 22

Recent Technical Advancement: .............................................................................................. 25

Policy Selection through internet and Recommendations: ........................................... 26

Policy Purchase and E-certificates: ....................................................................................................... 27
Working of Life Insurance: -....................................................................................................... 28

Marketing perspective: .............................................................................................................. 29

Marketing Mix of Insurance Services .................................................................................... 30

Depth of Product Mix-Insurance Perspective ......................................................................................... 31

Product levels: .............................................................................................................................. 32

Marketing Channels:.................................................................................................................... 35

What is Bancassurance?............................................................................................................. 36
Physical Evidence ................................................................................................................................. 38

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continued from last page

POSITIONING AND TAGLINE OF SOME INSURANCE COMPANIES: ................................................... 40

SIGNIFICANCE OF POLICY CONDITIONS AND Privileges: ............................................................. 41

Unit Linked Insurance Policies .................................................................................................. 49

Some Companies and their Products:- ..................................................................................... 51

AEGON Religare and Bajaj Allianz ......................................................................................................... 51
HDFC Standard Life Insurance .............................................................................................................. 52
ICICI Prudential Life Insurance ............................................................................................................. 52
Life Insurance Corporation of India (LIC) ............................................................................................. 53
SBI Life Insurance ................................................................................................................................ 53
About the project:........................................................................................................................ 54
Value proposition of RIBL: ................................................................................................................... 55
RIBL‟s Service Offerings: ..................................................................................................................... 56
Religare’s Central Leadership Team ....................................................................................................... 57
Board of Directors - Religare Enterprises Limited ........................................................................... 57
There is so much under one head of Religare: .................................................................... 58
Objectives of the project: ......................................................................................................... 59

Methodology for collecting data ......................................................................................... 60

Limitations of the study ............................................................................................................. 61
Key Findings and Observations: ................................................................................................ 62

I have analyzed these data on MS-EXEL also where I have found that among these 100 investors: ........ 67

The hypotheses of my project .................................................................................................. 69

Contingency Table 1.............................................................................................................................. 74
Experience with Religare Insurance Broking Limited: ........................................................................... 77
Recommendations: ................................................................................................................................ 78
Annexure:1............................................................................................................................................ 80
QUESTIONNAIRE.................................................................................................................................... 80

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 Abstract:
Monopoly of LIC has been broken to make Indian Insurance to change its face and
pace to tap the market and to make the new challenges in it.

Insurance in India is not about India only; it is an open sector for the private
players.

The name which you would see in Indian insurance market is something like: -
Birla (Indian company) + Sun (foreign player), TATA (Indian company) + Aig
(foreign player) and so many like them.

Companies now are tapping a lot of ways to capture the market and hence adopting
different ways to hold the large portion of the market.

My summer training learning helped me a lot to complete my project in order to

learn a lot of things of the corporate. As a project trainee the first task given to me
was to understand the basic behaviour of the consumer in order to manipulate the
market according to our target competition. For this I developed a questionnaire
and I did my survey in important locations of Dehradun.

From the very initial stage of the summer internship program in Religare Insurance
Broking Limited (RIBL) I had a very good concept in my mind to segment
insurance products and to target the right customer with a very lucrative policy and
to hit the bulls‟ eye as soon as possible. Because RIBL is a broking firm and it
deals with various product of 19 companies although they have their preferred
partners but pitching a right insurance product to the right customer according to
his need is not an easy task. Religare perform the task of selling by various ways
such as telli-calling, relationship manager and direct sales, business partners and
alternative business channel. By this project an insurance agent/salesperson can
gauge a right customer very easily and they can close the call within a very limited
time. In terms of target customers, insurance products can be broadly classified
into mass market and niche market products.

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In mass marketing, the seller engages in the mass production, mass distribution. A
niche on other hand is a more narrowly defined group seeking a distinctive mix of
benefits. Also, in terms of product complexity, insurance products can be
categorized into low complexity and high complexity products.

• Low complexity products: These are simple products with a standard set
of covered risks, perils.
• High complexity products: They have a large number of warranties and do
not compensate for certain causes of loss.
Insurance products with low complexity can be sold through bank-
assurance. But products with high complexity should be sold through
different means for example via well trained agents.

Different sectors into which the target customer can be divided:

 Households
 Industrial sector
 Trade sector
 Institutional sector
 Regional wise
 Rural sector

Significance of Segmentation in Insurance:

 Making the promotional measures creative which would be instrumental in
sensitizing the prospects.
 Personal selling would be effective since the sales personnel are aware of the
needs and requirements of the customers.
 The pricing and fee decisions can be rationalized in case of the weaker
sections of the society.
 The expectations of the prospects can be perceived in a right fashion.
 The development of the most profitable or attractive package of insurance
services or schemes would also be possible.

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STAGES OF ADOPTION PROCESS:
An innovation refers to any good, service, or idea. That is perceived by someone as
new. The idea may have long history, but it is an innovation to the person who sees
it as new. Innovation takes time to spread through the special system. The
consumer adoption process focuses on the mental process through which an
individual passes from first hearing about an innovation to final adoption. Adopters
of new products have moved through the following five stages.

1. AWARENESS: The consumer becomes aware of the innovation but

lacks information about it.

2. INTEREST: The consumer is stimulated to see the information about the

innovation.

3. EVALUATION: The Consumer considers whether to try the innovation

or not.

4. TRIAL: The consumer tries the innovation to improve his estimate of its
value.

5. ADOPTION: The consumer decides to make full and regular use of the
innovation.

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Work till date:
My project on “COMPARATIVE ANALYSIS OF DIFFERENT LIFE
INSURANCE PRODUCTS BASED ON CUSTOMER’S INCOME POTENTIAL
AND AGE GROUP” is totally depending on the aspects of segmentation and
targeting. But I have used two parameters so to make it simple and easily
understandable for the salesperson or agents and it can also be helpful for the
prospective buyers or investors because they can just go through their need and
capability and after that they can buy the best suited product . For collecting the
primary data I have designed a questionnaire where I have given different
questions needed for this particular project. Now the secondary data, which I
collected from insurance companies website about the different product so to have
the eagles eye on different products. Again a great help from Religare insurance is
being done by way of database of different customers selected on random basis
who had invested in different plans on that database I can find out their age, the
name of the product and the amount invested that is the first premium and the
income. This is the vital database of my project and all important analysis is being
done on this data. The analysis of this data would be done on SPSS and in MS-
EXCEL.

In this field of insurance broking industry there are many players coming
this project deals with the basic pathway to gain the top position among
them.

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INTRODUCTION:
History of Insurance

Insurance is a financial service for collecting the savings of the public and
providing them with risk coverage. The risk may be certain events like death,
pension, retirement or uncertain events like theft, fire, accident etc. The
references made to the concept of „Yogakshema’ in Rig Veda gives evidence
that in India insurance was known and practiced even during the ancient Vedic
times. The modern form of insurance with documentation started in London,
England in 1666 after a catastrophe of a large extent. The General Insurance
Company was started. The first recorded life insurance is that of William
Gybbons on June 18, 1633 in England.

Insurance Now:

New technologies, new inventions and changes in the economic and

financial scenario, all have thrown up new insurance needs; never felt or
heard before like Engineering insurance, loss of profit insurance, cover
against atomic radiation and space travel insurance etc. We have had bizarre
insurance covers. Lizza Minnelli the singing sensation had insured her voice
and so have Boy George and Michael Jackson. A well-known comedian in
the USA had a policy insuring those in his audience, against anyone dying of
laughter after hearing his Jokes! Present market share of Different
companies as on 2009 i

s like that:

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Insurance in India an overview with years
Some important milestones in the life insurance business in India are:

1818: The first Life Insurance Company known as the Orient Life
Insurance Company was established
1912: Indian Life Assurance Companies Act – first statute to regulate
the life insurance business.
1928: Indian Insurance Companies Act – government to collect
statistical information about both life and non-life insurance business.
1938: Protecting the interest of the insuring public.
1956: 245 Indian and Foreign insurers and provident societies –
central government and nationalized
1907: The Indian Mercantile Insurance Ltd. – transacts all classes of
general insurance business.
1957: General Insurance Council – frames a code of conduct.
1968: The Insurance Act – regulates investment & set minimum
solvency margins.
1972: The General Insurance Business (Nationalization) Act, 1972
nationalized the general insurance business in India with effect from
1st January 1973
1973
General insurance business was nationalized with effect
from 1st January 1973.
107 insurers were amalgamated and grouped into four companies namely
1) National Insurance Company Ltd.,
2) The New India Assurance Company Ltd.,
3) The Oriental Insurance Company Ltd
4) The United India Insurance Company Ltd.
Continued to next page:

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1993
The Government set up a committee under the chairmanship of RN
Malhotra former Governor of RBI to propose recommendations for
reforms in the insurance sector.
2000
The IRDA was incorporated as a statutory body in April 2000.
Foreign companies were allowed ownership of up to 26%.
2000-
Insurance Industry had 16 new entrants, 10 in Life and 6 in General
Insurance
2001-
Insurance Industry had 5 new entrants, 2 in Life and 3 in General.
2003-
Insurance Industry had 1new entrant, Sahara India Insurance
Company Ltd. In Life Insurance category
2004-2005
Insurance Industry had 1new entrant, Shri Ram Insurance company
Ltd. In Life Insurance category
2005-
Bharti Axa Life insurance company was granted Certification of
Registration in July, 2006
2006-
Bharti axa Life Insurance Company commenced its business.

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Regulatory body:
Insurance Regulatory & Development Authority
Insurance Regulatory and Development Authority (IRDA) was constituted in 1999
by an Act of Parliament to protect the interests of the policyholders and to regulate,
promote and ensure orderly growth of the insurance industry. IRDA consists of a
ten member team that comprises a Chairman, five whole-time members and four
part-time members. IRDA allows registration of new players in the insurance field.
It also has the authority to renew, modify, withdraw, suspend or cancel such
registration. IRDA ensures protection of the interests of the policy holders in
matters concerning assigning of policy, nomination by policy holders, insurable
interest, settlement of insurance claim, surrender value of policy and other terms
and conditions of contracts of insurance. It specifies requisite qualifications, code
of conduct and practical training for intermediary or insurance intermediaries and
agents.
After creation of IRDA, insurance sector has seen tremendous growth. Before
IRDA came into force there were only players in the insurance field, namely, Life
Insurance Corporation of India (LIC) and General Insurance Corporation of India
(GIC). Since then 23 new players have entered in the insurance sector.
Logo of IRDA

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CHARACTERISTICS OF INSURANCE INDUSTRY:
As this insurance industry is a Service Industry so it has the same characteristics as
Services which are also the drawback of the insurance industry, now I will show
the characteristics of insurance industry, their problem and the strategy needed

Characteristics, problems of insurance company:

 Intangibility: Any insurance company cannot give physical evidence of

the kind of service they are providing to their customers. And The
Insurance Company cannot promote its service by a mere display; it
needs to explain it to their consumers. According to IRDA, any Insurance
Company could not patent its policy. This rules acts as a hurdle to the
insurance company.
 Inconsistency: As it deals with human beings which are highly irrational.
Here, the Raw material as well as the final product is not a physical
product. It is very difficult to set up Quality Control in case of Insurance
as the main elements of the product/service are Human Beings.
 Perishibility: Insurance products are perishable in nature e.g. If an
agent/salesperson/broker is able to convince a customer by promising
him maximum benefit from a particular policy, he need to provide the
same within the time, or else the customer may switch to some other
policy or even some other Company.
 Inseparability: Another characteristic of insurance company is the
services offered by company are inseparable in nature i.e. there must be
continuous interactions between the agents and the customers. The
production process begins when the agent convinces the consumer to buy
the policy and it is said to be consumed when the claim is settled and the
policyholder gets the money.

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Essential Features of Insurance:-
1. Offer and Acceptance: - There should be the offer by the customer in form of
proposal form and Acceptance by the Insurance Company.

2. Consideration- There should be the valid consideration against the insured

property in terms of the premium to b paid by the consumer.

3. Agreement between the parties: - There should be consensus on the both side
of the parties.

4. Capacity to contract: - The Insured should have the capacity to perform the
contract as that he/she should be of sound mind b) he/she should not be abided by
law to go for any contract c) he/she should be major that he should have the age
minimum to 18.

5. Legality: - there should be the legality of contract as it should be legal in nature

and must be brought for the lawful consideration.

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Benefits/Function of insurance:
PRIMARY FUNCTION:-
1. Provide protection: - As risks controlling is not in the hands of anyone
completely that is why Insurance Company provides the risk protection.

2. Collective bearing of loss: - Insurance Company would have to accept the loss
and give respective claims as for the sake of contract that has been done between
the company and the insured.

3. Assessment of Risk: - There should be the proper assessment of the risk so as to

charge the correct and legible premium to insure the subject matter of insurance.

4. Provide the certainty: - As the losses appear from the uncertainty so Insurance
Company would have to provide the certainty of absorbing the loss so as to protect
the insured under the risk in which he has been insured.

SECONDARY FUNCTION:-

1. Prevent Loss: - Insurance cautious businessman and individuals to adopt

suitable device to prevent unfortunate consequences of risk by observing safety
instructions.

2. Small capital to large risk: - Small capital is demanded to cover the risk of the
large capital.

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Reasons for buying Insurance policy:

Key Demand Drivers for Life Insurance are

Risk Cover Savings Tax Incentives

Risk Cover

Changing Attitudes: Insurance coverage undertaken is influenced by both

economic status and social and cultural attitude. Globalization coupled with rising
literacy and income levels have gradually changes attitudes with a rise premium
growth rates in recent years. Also events like 9/11 have changed the attitudes of the
people towards insurance.

Smaller Families: Economic growth has led to urbanization and proliferation of the
nuclear family system. The security provided by the joint family system is coming
to an end.

Less Social Security: As compared to other economies, both the type and
penetration of the social security measures in India has been grossly inadequate.

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Savings

Literacy effect: Increasing literacy has resulted in transfer of savings from physical
to financial assets. The maximum number of policies sold by
LIC has been in the southern states where the level of literacy is the highest in the
country.

Age and class: Demographic trends reveal a burgeoning middle class base across
all age groups. This could drive the demand for life insurance products in the case
of the younger age groups and pension products in the older groups.

Use as collateral: Insurance policies are accepted by financing agencies as

collateral for retail loans to ensure that in the event of the death of the borrower,
the maturity proceeds are adequate to discharge the loan.

Tax Incentives

The availability of tax incentives on insurance policy makes it a compelling

demand driver for insurance. Though this year‟s Budget is harsh on this aspect,
there are many incentives available for pension and annuity precuts.

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PEST analysis of Insurance Industry:

 Political Factors:
 Malhotra Committee in 1993 recommended that :
a. Private Companies with a minimum paid up capital of Rs.1bn
should be allowed to enter the industry.
b. Foreign companies may be allowed to enter the industry in
collaboration with the domestic companies.
c. Only one State Level Life Insurance Company should be allowed to
operate in each state.

 Reforms in the Insurance sector :

a. The IRDA Bill passed in Parliament in December 1999.
b. The IRDA has stuck to its schedule of framing regulations and
registering the private sector insurance companies since 2000.
 Privatization of Insurance sector
a. The private players in the market has taken new and innovative
steps.
b. 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.
 FDI in Insurance Sector
a. The government had allowed the private players to have foreign
equity up to 26%.
b. Efforts are going on to raise this to 49 %.
c. After the opening up of the sector, a total of 18 private sector
companies have entered with a foreign partner.

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ECONOMIC IMPACT
Indian Economy – at a glance

India is the world‟s 4th largest economy in the world in terms of purchasing power
parity, has a workforce of over 472 millions and a domestic consumers base that
represents about 15%of the world‟s total population. It is also the world‟s largest
democratic economy. India‟s GDP growth is 7.7% approx.

Source: Internet

Indian Economy Growth Rate

Indian economy has growing at a good speed as we know that the India‟s GDP
growth rate was around 2.2% approx. in the year 1951 and as the time passes we
see the economy has reacted to the circumstances and it has moved ups and down,
for instance, in 1973 the economy has seen the oil crisis because of which the
economy has come down, but now the economy is growing at a rate of 8%.

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Indian Insurance Industry Growth and Inflation

As the Indian Economy is growing the

number of players in the insurance industry
has also increased from 13 to 15, (Shriram
sanlam Life Insurance and Bharti Axa Life
Insurance being the two) but still the
market share of LIC has increased from
71% in the year 2005 to 79.65% till Oct, 2006. LIC‟s performance has also pushed
the industry‟s growth rate to 163%, since LIC itself has grown faster than the
industry growth at 184%. It seems that if the Industry continues to grow like this
then the growth of insurance industry growth would be fastest in the world.
According to the Swiss Re, the
world insurance industry grew at an
inflation-adjusted rate of 3.9% for
the year 2005 whereas India‟s life
insurance industry has grew at over
8.9% after adjusting for inflation.
Even in general we see that in the rate of inflation has increased in the economy
from 4.49% as on 22 Oct. 2005 to 5.41% as on Oct. 21, 2006, because of the high
inflation in all the sectors, especially in the Fuel, Power, Lights and Lubricants
sector.

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Social Factors:

 Life expectancy & Mortality rate are used to derive the premium of a
particular policy.

 All the insurance companies follow a standard table referring to which they
decide upon the premium rates.

 Premium rates largely depend on demographic factors like age, sex of the
individual insured.

 The Indians are vulnerable and tend to pay more attention towards the
insurance advertisements and insurance products.

 The consumer‟s mindset is such that insurance is viewed as a liability.

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Technological impact

 Computers were introduced in the mid 1960‟s and by the 1980‟s entire
process were computerized.

 The internet has completely changed the service delivery process.

 Internet is today used to sell insurance policies, for sending premium notices
to policy holders through e-mails, for premium calculations.

 Almost all the organizations today provide the ECS facility to its customers.

Many insurance companies have a tie-up with commercial banks so as to enable

policyholders to use the facility of paying premiums through the bank ATM‟s.

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Recent Technical Advancement:
Technology has been the lifeline of almost all the business sector in and around us.
Today we can find its use in various aspects of each sector. The insurance sector is
not to be left behind. Talking about the recent technical advancement the biggest
leap for the sector would be the evolution of:

1. E-business: Now with transactions, communication, and even authentication

through internet; insurance sector is also finding its feet in this field. The
insurance companies also derive major benefits in terms of saving on
transaction costs and time. In the US, manual procedures including those for
handling referrals, eligibility, treatment authorizations can cost anywhere from
Rs.500.00 to Rs.4250.00 per transaction. In terms of technology India has
superior strengths, which could be leveraged to leapfrog to the next level.
Standardizing vocabulary in the healthcare space so than when an electronic
medical record of an NRI patient indicates a “patient encounter” healthcare
administrators and clinicians are able to relate to what that means and the
insurance implications of the same.
2. Data Analytics: One of the most important upcoming fields in various sectors
including insurance is data analysis using SPSS. Because unlike traditional
customer analysis that involves analysis of descriptive and behavioral data,
SPSS solutions offer interaction and attitudinal data that provide comprehensive
analytics.

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Policy Selection through internet and Recommendations:

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Policy Purchase and E-certificates:

 Online Claim Settlement

 Pre-launch Product Development

 Features of E-insurance: Search Costs and hidden charge , Price

Competition, Niche Creation.

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Working of Life Insurance: -
Risk has to be assessed in order to decide tithe premium or to decide that subject is
insurable or not.

Pure Risk vs. Speculative Risk:-

Event representing there will be possibility of loss or no loss is called pure risk.
These risks are insurable in nature.

Speculative risk is the one which truly resembles gamble. There is the possibility
of loss or gain and wherever there is a chance of making profit there insurance
cannot exist. Therefore these risks are not insurable in nature.

Approaches to Risk Management:-

Risk Management is the process of minimizing the risk due to unforeseen events.
Steps involved in selecting the Risk Management are:-

To identify all the things that can be possibly wrong.

To consider possibility that an event can occur.

Techniques toward the Risk Management;-

1. Avoiding the Risk: - Risk can be managed by avoiding it as when the perils will
come then it will be managed.

2. Eliminate the Risk: - Risk can be managed by eliminating the cause of the loss.

3. Reducing the Risk: - Risk can be reduced by handling them in a systematic

manner.

4. Transfer of Risk: - Risk can be minimized by transferring the risk of loss to any
other person which is a true form of the INSURANCE.

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Marketing perspective:
'Marketing is delivery of customer satisfaction at profit.' Marketing, as we know
deals with all those processes required for putting products in hands of ultimate
consumer. Steps involved in marketing processes are brought out by study of four
critical parameters, which are famous 4P's. i.e. Price, Place, Product and
Promotion. Financial services whether its Banking, or Investments, Life Insurance,
General Insurance, though target separate need base, have services component
connecting them. In order to link marketing process to Insurance products, first it
has to be seen in broader context of financial services marketing and also
regulatory environment that is in place.

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Marketing Mix of Insurance Services

Product Mix
 Insurance sector, the product mix comprises of Life and Non – life insurance
policies

 A company‟s product mix has certain width, length and depth.

Width : Three different product lines i.e. Life Insurance, Marine

Insurance and Fire Insurance
Length: refers to the total number of items in the mix. In case of
insurance sector, the following is the length of product mix:

Insurance

Life insurance General Insurance

ULIP i) Motor
Endowment ii) Marine insurance
Moneyback iii) Fire
Term iv) Burglary
Pension v) Mediclaim

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Depth of Product Mix-Insurance Perspective

 Depth: The various products and various types of the products with distinct
features.

Whole life insurance

Limited
Whole life with Single premium
payment whole
profit policy whole life policy
life policy

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Product levels:

Product levels:

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Price Mix:
Price is one element in the marketing mix that produces revenue; all
the other elements produce costs
In insurance, the pricing decisions are concerned with:

Premium charged against the policies,

Interest charged for defaulting the payment of premiums
Credit facilities, commission charged for underwriting &
consultancy services
Place Mix:
 Place mix is about the “Physical distribution i.e. the delivery of
goods/ services at the right time at the right place to the
customers.”
 Involves building relationships with the wholesalers, retailers and
through these intermediaries building relationships with the
customers

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 Promotion Mix:
 Brochures: LIC have brochures of various schemes that are available in
different languages.

 Sales Promotion :Gifts , Sponsoring events

Eg: Max New York Life Insurance sponsored triseries.

 Personal Selling through Agents

 Word Of Mouth: carried out by customers, agents and employees.

 LIC‟s promotion in rural areas.

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Marketing Channels:
Out of all available channels like direct selling, brokers and agents, one that is
gaining most relevance is that of Bancassurance.

Channels

Direct Selling  Agents

 Financial Advisors
 Call Centers

Partner Selling  Bancassurance

 Postal Department
 Selling by Corporate

Electronic channels  LIC on internet

 Information Kiosks
 SMS

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What is Bancassurance?
Bancassurance is distribution of insurance products through bank's distribution
channel. It is a phenomenon wherein insurance products are offered through
distribution channels of banking services along with complete range of banking
and investment products and services. Bancassurance tries to exploit synergies
between both insurance companies and banks.
Bancassurance if taken in right spirit and implemented properly can be win-win
situation for all participants' viz., banks, insurers and the customer.

Advantages to banks
Productivity of employees increases.
By providing customers with both services under one roof, they can improve
overall customer satisfaction resulting in higher customer retention levels.
Increase in return on assets by building free income through sale of
insurance products.
Can leverage on face-to-face contacts and awareness about financial
conditions of customers to sell insurance products.
Banks can cross sell insurance products E.g.: Term insurance products with
loans.

Page 36 of 82
To insurers
Insurers can exploit banks' wide network of branches for distribution of
products. Penetration of banks' branches into rural areas can be utilized to
sell products in those areas.
Customer database like customers' financial standing, spending habits,
investment and purchase capability can be used to customize products and
sell accordingly.
Since banks have already established relationship with customers,
conversion ratio of leads to sales is likely to be high. Further service aspect
can also be tackled easily.

To consumers
Comprehensive financial advisory services under one roof. i.e., insurance
services along with other financial services such as banking, mutual funds,
personal loans etc.
Enhanced convenience on the part of the insured
Easy accesses for claims, as banks are a regular go.
Innovative and better product ranges

Page 37 of 82
Physical Evidence

 Physical evidence is the environment in which the service is delivered and

where the company and the customers interact

 However, in case of insurance sector, the customer rarely visits the

insurance company. The customer comes mostly only in contact with the
service provider.

Page 38 of 82
 People Mix:

 Employees: The various employees involved in providing service to the

customer in insurance sector are:
 Customer Service Representatives.
 Marketing and Sales Managers.
 Claim adjusters, appraisers, examiners and investigators.
 Underwriters.
 Insurance Sales Agent.
 Customers.
 Programmers and System Analysts.
 Lawyers.

Process Mix:
 Interaction between the customer and the insurance agent in the process of
selling.

 Settlement of claims

 IT applications used for data management and risk management.

Page 39 of 82
POSITIONING AND TAGLINE OF SOME INSURANCE COMPANIES:
Brand Positioning Tag Line

LIC “Zindagi ke saath bhi, zindagi ke baad bhi”

Oriental “Prithvi, Agni, Jal, Aakash, Sabki suraksha hamare paas”

Insurance

ICICI “Business Uninterrupted”

Lombard

ING Vysya “Your dreams , Our commitment”

Royal “Beyond Expectations”

Sundaram

Bajaj Allianz “Haske Jeeyo Yaar”

MAX NEW “Your Partner for life”

YORK

ICICI
“WE COVER YOU AT EVERY STEP OF IN LIFE”
PRUDENTIAL

Page 40 of 82
SIGNIFICANCE OF POLICY CONDITIONS AND Privileges:
Life Insurance Contracts

Life insurance policy is a document which expresses the contract between the
insurer and the insured. Most of the insurance companies have standard forms of
policies with standardized policy conditions in respect of various plans of
assurance offered by them. The policy document, to be enforceable by law, is to be
signed by the competent authority and duly stamped according to the Indian Stamp
Act. The preamble of the policy states that the proposal and declaration signed by
the party form the basis of contract. The form contains a schedule which gives all
essential particulars of the policy like name, address, plan of insurance, premium,
amount of insurance, etc. On the back of the policy, the standardized terms and
conditions applicable to all persons insuring under a particular plan are printed.
Any special conditions imposed are indicated by endorsement. Some of the most
common and important conditions and privileges which form a part of the policy
document, and their significance, are narrated on the next page:

Page 41 of 82
Days of grace

Days of grace or grace period is the‟ extra time' given to the policyholder for
payment of installment premium after the due date, during which the policy
remains in force. It is normally provided for a period of a fortnight to a month.
Grace period is meant to be a convenience to the policyholders, some of whom
may not be able to pay the premiums on time due to certain preoccupations etc.

Revival of Policies

A lapsed policy can be brought back to life through revival, as if it is a fresh

contract, subject to certain restrictions with regard to the period of lapse etc. The
policyholder may however be required to submit a fresh set of medical and other
requirements/declarations at the time of revival. For the purpose of a claim too, the
policy may be treated as new and Sec.45 of the Insurance Act, 1938 be applied.

Surrender and Paid up Value

Sec.113 of the Insurance Act provides for accrual of certain benefits to

Policy holders even if they are unable to keep their policies in full force by
payment of further premiums. If premiums for at least three consecutive years have
been paid, there shall be a guaranteed surrender value. If the policy is not
surrendered, it shall subsist as a paid up policy for reduced sum. The policy
conditions usually provide for a more liberal surrender value and paid up value
than those secured by the statutory provisions.

Page 42 of 82
Policy Loans

Policy loan is a ready source of borrowing to a policyholder, in a financial

contingency. It is paid by insurers against the surrender value accrued to a policy.
Policy loans lend liquidity to contracts which are otherwise 'frozen' during the term
of the policy. From the insurers' point of view, they add to the marketability of the
insurance products while also being an avenue for secure investments.

Non-Forfeiture Regulations

While grace period is meant to be a convenience, non-forfeiture regulations

provide succor to policyholders who are unable to pay premiums due to temporary
financial difficulties. No forfeiture regulations allow additional time of say, six
months or a year for payment of premiums on a policy, even as the risk under the
policy continues to be covered. Insurers offer this privilege after the policy has
been in force for a few years and is not offered on term assurance and some of the
'high risk cover' policies.

Page 43 of 82
Riders

It is possible to tag-along coverage of additional risks to the basic life product on

payment of additional premiums, subject to certain conditions and restrictions.
Such add-ons like accident riders, critical illness riders, premium waiver riders in
case of minor life policies etc are quite popular and more such riders are coming
into vogue. Riders are complex by nature and are often not properly/fully
understood by the parties concerned. This causes complaints and legal disputes at
the time of claims and calls for defining and interpreting the coverage and
exclusions sharply. The most popular and perhaps the most ancient of all the riders
is the accident benefit rider which provides for payment of additional sum assured
in the event of death or permanent disability. The most popular and perhaps the
most ancient of all the riders is the accident benefit rider which provides for
payment of additional sum assured in the event of death or permanent disability by
accident.

Page 44 of 82
Suicide Clause

As per Indian law suicide is not a crime, but attempt to suicide is a crime unlike in
English law where suicide is a crime. Hence, contracts of insurance that agree to
pay the sum assured even in the event of the death of life assured due to suicide are
not against public policy. But, to avoid a possible moral hazard and adverse
selection, insurance companies do place a restrictive clause by not covering death
as a result of suicide up to one year from the date of commencement of policy or
date of issuing of policy whichever is later. However, provided a due notice is
received, life insurers protect the bonafide interests of the third parties who are
having an interest in the life of the life assured. While the former dissuades the life
assured to be not magnetic of the benefits of life assurance by committing suicide,
the later protects the financial interests of third parties as life insurance policies are
also used as tools of collateral security.

Page 45 of 82
Pregnancy Clauses

On life insurance policies issued during the pregnancy of a female proponent, life
insurers apply this clause to exclude coverage of pregnancy/child birth related
deaths. However, with the advancement of medical technology, the relevance of
these clauses is gradually reducing. But, life insurers may apply these clauses to
those female lives who reside away from medical facilities that are potentially
prone to risks of pregnancy/child birth related deaths. If data pertaining to
pregnancy risk in a particular region is not available, insurers may apply these
clauses to the female lives of the region. Occupation related clauses To exclude the
risks that are closely related to the occupation (like that of a pilot whose
occupation is prone to aviation risks) of the life assured, insurance companies do
levy these clauses excluding the risk coverage owing to the death of the life
assured during the course of employment.

Continued to next page:

Page 46 of 82
Ex: Aviation clause, divers' clause. Lien Clause In respect of certain types of high
risk life insurance policies where insurers have a lower level of comfort due to the
adverse disclosures made in application for life insurance and where insurance
coverage cannot be denied based on such disclosures, life insurance companies do
impose lien clause which could either limit the liability of the insurer during a

specified period (like50% of sum assured during first year, 75% in the second year
and 100% from the third year onwards); or defer the coverage for a specified
period (like no life cover during first year of the policy). Life insurers also reserve
the right to impose a clause during the term of the policy through a clause based on
the future occupation that a minor life may engage in. Under the current clause,
insurers require the minor life to notify them in the event of minor life engaging in
hazardous occupations. On receipt of information from the life assured on his
reaching the majority or on his joining the services of hazardous occupations, life
insurers may apply such occupational clauses as deemed necessary. Hence,
policies issued to minor lives will be subject to these clauses

Page 47 of 82
IRDA (Protection of Policyholders' Interests) Regulations, 2002 Reg.6 of the
IRDA (PPI), 2002 exclusively deals with matters to be stated in a life
insurance policy and includes important items such as:

• Name of the plan and whether it is participating in profits or not.

• Benefits payable and contingencies upon which these are payable
• Details of the riders attaching to the main policy
• The premiums payable, periodicity, grace period, implication of discontinuing
the payment of an installment of premium and provisions of a guaranteed
surrender value.
• Age at entry and admission status, policy requirements for surrender, non-
forfeiture and revival of lapsed policies.
• Provisions for nomination, assignment and policy loans and statement about
rate of interest on policy loans.
• Special clauses such as suicide clause, first pregnancy clause etc.
• Address of the insurer.
• Documents normally required to be submitted by a claimant in support of a
claim.
• Reg. 6(2) refers to the 15 days period available to the policyholder to review the
terms and conditions and where he disagrees to the same, to return the policy.

Page 48 of 82
Unit Linked Insurance Policies:
The advent of unit linked insurance policies has created new issues with regard to
policy conditions and privileges of the policyholder apart from issues on
disclosures. To overcome these issues, IRDA came out with its guidelines in Dec
2005 which mandate, among others, that the following be mentioned prominently
on a policy bond:

The minimum and maximum percentage

of the investments in different types (like equities, debt etc)
The definition of all applicable charges, method of appropriation of these
charges and the quantum of charges that are levied
On top of the policy document, wherever applicable, the statement 'In this
policy, the investment risk in investment portfolio is borne by the
policyholder'. At present as many as sixteen life insurance companies are
operating in India and each one is issuing policy formats with different
variations. As there is no uniformity, it is difficult for the market as well as
policyholders to comprehend and make reasonable comparisons of terms and
conditions…

Continued to next page…………………………

Page 49 of 82
Privileges and benefits offered by different insurers. Hence, it is worthwhile that a
serious attempt is made at the earliest to reduce the complexities of the policy bond
with a judicial standardization which provides much needed solution without
compromising the competitive spirit of the market.
The developments in technological front enabled financial sector to move from
paper based documentation to digitalization of documentation. The trend which
was initiated in securities market has revolutionized the services and reduced the
transaction costs to individual investors. The pace of services has also improved
with the time. Digitalization of documents along with the availability of techno-
driven banking services like ECS (Electronic Clearing Services) enabled financial
sector to settle financial transactions on a real time basis, thus increasing the
expectations of investing public for a similar service in other spheres of financial
sectors like 'insurance'. Drawing a cue from the success stories of these sectors
there is a growing demand from various sections of society that insurance
companies shall also usher in digitalization of policy documents, thus converting
them to a dematerialized (demat) form. However, unlike other financial
transactions, in the case of insurance contracts, they are either annual contracts as
in the case of general insurance or long term contracts as in the case of life
insurance contracts.

Page 50 of 82
Some Companies and their Products:-

AEGON Religare Life Insurance

Major products are

Child plan: Star child plan

Savings plan: Protect Gain Plan

Pension Plan: AEGON Religare Pension Plan

AEGON Religare Insta Pension Plan

Bajaj Allianz

:
Major Products are
Unit Linked - Unit Gain plus Gold
Pension – Swarna Vishranti
Endowment – Life time Care, Invest Gain
Term – Term Care

Page 51 of 82
HDFC Standard Life Insurance

Major products are:

Unit Linked – Unite Linked Endowment Plus II

Pension – Personal Pension plan
Endowment – Endowment Assurance Plan
Term – Loan Cover term Assurance plan

ICICI Prudential Life Insurance

Major products are

Unit Linked – Life Time Gold

Pension – Forever Life
Endowment – Cash Back
Term – Life Guard

Page 52 of 82
Life Insurance Corporation of India (LIC)

Major products are:

Unit Linked – Market Plus
Pension – Jeevan Nidhi
Endowment – Jeevan Mitra
Term – Anmol Jeevan-I

SBI Life Insurance

Major products are:

Unit Linked – Horizon II
Pension – Life long Pension
Endowment – Sudarshan
Term – Swadhan
Birla sun life Insurance:

Major products are:

Unit Linked: Dream Plan, Platinum Plus

Health Plan: BSLI Health Plan, Children Plan: Children Dream Plan.

Pension Plan: Freedom 85

Page 53 of 82
About the project:
Name of the project: “COMPARATIVE ANALYSIS OF DIFFERENT LIFE
INSURANCE PRODUCTS BASED ON CUSTOMER’S INCOME POTENTIAL
AND AGE GROUP”

Brief description of the project and Religare Insurance Broking Ltd.:

The project deals with the research on effective marketing of Life Insurance
policies/plans according to the income potential and the age of the customer. The
project is very useful as the financial market become very fragile and complex;
investor needs a financial intermediary who provides the required knowledge and
professional expertise on successful investing very easily according to their needs.
This is the time when people want a secured return and there is nothing other than
a good insurance policy. This study will not only benefit any company but would
also benefit brokers/agent/sales person in hitting the right target audience for a
particular insurance product. Descriptive study will be carried out to perform this
research. The project is basically for Religare Insurance Broking Limited (RIBL),
a 100% subsidiary of Religare Enterprises Limited is one of India‟s leading
insurance broking firms, with one of the largest retail networks in the country. The
company holds a composite broker‟s license operating in the Life, General and
Reinsurance domains. An insurance portfolio is designed from a choice of more
than 3000 life and general insurance products & plans from more than 30
companies. This one easy window for any brand of insurance, any kind of cover,
offers tailor made insurance solutions with not just the right kind of cover but also
the right mix of cover. RIBL not only provides customized solutions to individual
clients, but also to some of the leading corporate houses and institutions across the
country.
Page 54 of 82
Value proposition of RIBL:
Value Proposition
Presence Pan India foot print
Strong Domain Expertise Rich domain knowledge and Industry experts
Comprehensive Risk Portfolio Expertise to meet all your Insurance needs
Management
Flexibility Market understanding, proactive and customer
centric
Stability Part of a large diversified Indian trans-national
group with presence in over 1550 locations
across more than 460 cities & towns in India
and globally across 10 countries.
Infrastructure Human, technical, physical presence, CRM
Quality Best business practices and highest quality
service
Strategic Partnerships Alliance with global and national players to get
you the best deals

Page 55 of 82
RiBL’s seRvice offeRings:

Vision and Mission:

Vision - To build Religare as a globally trusted brand in the financial services

domain and present it as the „Investment Gateway of India'.

Mission - Providing complete financial care driven by the core values of diligence
and transparency.

Brand Essence - Core brand essence is Diligence and Religare is driven by ethical
and dynamic processes for wealth creation.

Page 56 of 82
ReLigaRe’s centRaL LeadeRship team

Mr. Sunil Godhwani

CEO & Managing Director, Religare Enterprises Limited
Mr. Shachindra Nath
Group Chief Operating Officer, Religare Enterprises Limited
Mr. Anil Saxena
Group Chief Finance Officer, Religare Enterprises Limited

Board of Directors - Religare Enterprises Limited

Mr.Malvinder Mohan Singh
Non Executive Chairman
Mr. Sunil Godhwani
Managing Director & Group CEO
Mr. Shivinder Mohan Singh
Non Executive Director
Mr. Harpal Singh
Non Executive Director
Mr. Deepak Ramchand Sabnani
Independent Director
Mr. Padam Bahl
Independent Director
Mr. J. W. Balani
Independent Director
Ms. Sunita Naidoo
Independent Director
Mr. R. K. Shetty
Alternate to Mr. J. W. Balani
Capt. G. P. S. Bhalla
Alternate to Mr. Deepak Sabnani

Logo of Religare:

Page 57 of 82
There is so much under one head of Religare:

Page 58 of 82
Objectives of the project:

To give Religare Insurance Broking limited a descriptive suggestion on

insurance plans/policies

a) To find out what respondents expect from life insurance.

b) To find out the strength and the weakness of their plans.

c) To know how much a person invest as premium of his total

income.

d) To help not only any company but also benefit

brokers/agent/sales person in hitting the right target audience
for a particular insurance product.

e) To come out with conclusion and suggestions based on the

analysis and the interpretation of the data

Page 59 of 82
Methodology for collecting data
In this research the type of data collection will be

Primary data:
 Questionnaire
 Personal interview
Secondary data
 Websites
 Magazine and journals
 Brouchers of Companies
 Religare’s database

SAMPLING PLAN:

It is very difficult to collect information from every member of a population

.As time and costs are the major limitation that the researcher faces. A
sample of 60-100 was taken selected on the basis of convenient sampling
technique. The individuals will be selected in the random manner to form
sample and data were collected from them for the research study. Data
collection through questionnaire and personnel interview and RIBL‟s
database resulted in availability of the desired information but these were
useless until there were analyzed.

Page 60 of 82
Limitations of the study

 Respondents are not keen to disclose about their incomes in the

questionnaire
 They know that they have invested but the details regarding the
policy are not known to them.
 High incomes groups are not interested to purchase through cold
calling and even they don‟t want to talk.
 Limited knowledge of insurance companies except LIC.
 Cost is the major factor for carry out this study because neither the
company nor the Institution is providing any monetary expenses
incurred on the project purpose.

Page 61 of 82
Key Findings and Observations:

Till now I have surveyed more than 60 people where I have found that most
of them are not keen to disclose about their income. And they know they
have already invested but they don‟t know about the name of the product but
at least I have collected the name of the company in which they have
invested and the type of product. As the financial market now a days is very
fragile due to that reason most the respondents are not interested in ULIP. I
have also noted some of their comment on the ULIP that goes like MR.H.S.
CHADDA said “ULIP ARE OF NO WORK, INVESTED 4, 00000 AND
NOW THE FUND VALUE IS 1, 85,000. INSURANCE COMAPANIES
ARE JUST COLLECTING MONEY FROM THE PEOPLE AND
INVESTING IN THE MARKET .THEY ARE JUST A PROFIT EARNING
MACHINE AND THEY HAVE CHANGED THE MEANING OF
INSURANCE.” According to my survey now a days people having income
between 1lakh to 3 lakhs are keen to invest in guaranted return policy and
they have shown their interest on TATA-MAHA LIFE GOLD which is a
traditional plan. The respondents want guaranted returns from the market.
According to my survey most of the respondents are not aware of MEDI-
CLAIM policies in Dehradun. We have got very good response from Birla
and ICICI‟S health policy even from a low income group. Respondents
having ages among 32-40 have shown their interest on Child Plan with
gurranted return.

Page 62 of 82
The secondary data collected from RIBL goes like this among 120 investors most
of them shown their interest on the secured ULIP‟s.

I have done a study on 100 investors on random basis on that I found that in
SPSS :
An equation can be formed based on these three independent factors
Y= a+bx1 + cx2 + dx3
Y= premium( dependent variable)
X1 = age
X2= plan category
X3= income slab
H0 : there is significance difference between the variables i.e. age,income
category and plan category.
H1 : there is no significance difference between the variales i.e. age,income
category and plan category.
.
Regression analysis:

Descriptive Statistics

Mean Std. Deviation N

premium 21326.47 27876.098 100
Age 33.75 8.887 100
Income slab 50.69 .720 100
Plan category 13.09 7.017 100

Page 63 of 82
 Correlations

Premium age Income slab Plan category

Pearson Correlation premium 1.000 .042 .534 .157
age .042 1.000 .065 .106
Income slab .534 .065 1.000 .030
Plan category .157 .106 .030 1.000
Sig. (1-tailed) premium . .339 .000 .060
age .339 . .260 .147
Income slab .000 .260 . .385
Plan category .060 .147 .385 .
N premium 100 100 100 100
age 100 100 100 100
Income slab 100 100 100 100
Plan category 100 100 100 100

Variables Entered/Removed (b)

Variables Variables
Model Entered Removed Method
1 Plan
category,
income . Enter
slab,
age(a)
a All requested variables entered. b Dependent Variable: premium

Model Summary

Mo Adjusted R Std. Error of

del R R Square Square the Estimate Change Statistics
R Square R Square
Change F Change df1 df2 Sig. F Change Change F Change df1 df2
1 .553(a) .305 .284 23594.855 .305 14.062 3 96 .000

a Predictors: (Constant), plan category, income slab, age

Page 64 of 82
 ANOVA (b)

Sum of
Model Squares Df Mean Square F Sig.
1 Regression 234857575 7828585840.7
3 14.062 .000(a)
22.345 82
Residual 534448512 556717200.27
96
26.566 7
Total 769306087
99
48.911
a Predictors: (Constant), plan category, income slab, age
b Dependent Variable: premium

Coefficients (a)
Standardi
zed
Unstandardized Coefficien 95% Confidence Interval for
Model Coefficients ts t Sig. B Correlations
Uppe
r
Lower Boun Zero-
B Std. Error Beta Bound d order Partial Part B Std. Error
1 (Consta - -
166867.34
nt) 1025727.4 -6.147 .000 1356956.50 -694498.396
1
50 4
Age -23.575 268.873 -.008 -.088 .930 -557.282 510.133 .042 -.009 -.007
income
slab 20526.347 3299.231 .531 6.222 .000 13977.425 27075.269 .534 .536 .529
Plan
categor 562.951 339.963 .142 1.656 .101 -111.871 1237.773 .157 .167 .141
y

a Dependent Variable: premium

Coefficient Correlations (a)

Model Plan category Income slab age

1 Correlations Plan category 1.000 -.023 -.104
Income slab -.023 1.000 -.062
age -.104 -.062 1.000
Covariances Plan category 115575.058 -25608.098 -9535.878
Income slab 10884926.93 -
-25608.098
4 55283.663
age -9535.878 -55283.663 72292.438

a. Dependent Variable: premium

Page 65 of 82
On SPSS while putting the data I have categorized the income level by denoting
50, 51, 52, 53 and 54 and I have denoted different policies from 1 to 24 on a
random basis.
From the Anova table we can see that the significance level is .000 so we can say
that the people in Dehradun invests totally dependent on their age, income and plan
category which effects the premium in a great way.

From the correlation matrix we can say that if there is a change of 4.20% in age the
premium also changes by this amount.

In Sig. (1-tailed) level we can see that 26% people is not dependent on their age for
investment rest 74% is dependent on their age for investment.
R2 = 30.5% of the varinance in the dependent varible that is explained by the
variation in the independent variable.

According to Richard l. Levin And David S. Rubin Anova compares estimate of

between column variance and estimate of within column varinace of the population
variance by computing their ratio called F Hypothesis Test.
First estimate of the population variance based on the variance among the sample means
F=
Second estimate of the population variance based on the variances within the sample

From the data analysed on spss I got F=14.068 which signifies at 0.05 significance
level there are relationships among age, income slab and plan category.

So, the null hypothesis is accepted.

Page 66 of 82
I have analyzed these data on MS-EXEL also where I have found that among
these 100 investors:

Figure 1.

No. of person according to income slab

1% 1%

6%
50-1 lacs
43%
1-3 lacs
49% 4-6 lacs
7-9 lacs
10-12 lacs

In these 100 investors there are 43 investors are in 1-3 lacs slab like that 49
investors are in income slab of 4-6 lacs, 6 investors are in the age group of 7-9 lacs,
then 1 and 1 investors are in income slab of 7-9 lacs and 10-12 lacs respectively.

Page 67 of 82
Figure 2:

No. of persons according to premium slab

60
50
40 49

30
20
21
10 15 person
2 7 6
0

As you can see from the graph that in these 100 investors there are 49 investors
who are paying premium less than Rs.10000, 21 are paying premium in the slab of
10001-20000, 15 among them are paying premium between 20001-30000, and in
the premium slab of 30001-40000,40001-50000 and 50001 and more there are 2,7
and 6 persons respectively.

Page 68 of 82
The hypotheses of my project

H0: μ= Age, Income, Premium and Plan category are independent

H1: μ = Age, income, premium and plan category are dependent.

Page 69 of 82
Figure 3. Name of the insurance policy according to income slab

50
45
40
35
30
25
20
15
10
5
0

assurance,UP2,cdp,ko…
ml,dp,ksa,elp,aip

cdp
elp
plan name

sj,pp,unit plus 2
ksa,sj,pension
plan,term

Series1

income 50-.99 1-3.99 4-6.99 7-9.99 10-12

slab lacs lacs lacs lacs lacs

Here,

ELP:Easy life plus,Aviva

ML: Mahalife gold,tata aig

KSA: kotak smart advantage

AIP: Automatic Investment plan

DP: Dream plan, Birla sun life

Aegon Pension plan: Aegon Religare

UP2: Unit Plus 2, SBI life insurance

SJ: Saral Jeevan, Birla Sun Life.

PP: Platinum Plus, Birla Sunlife.

CDP: Children Dream Plan, Birla Sunlife.

Term Assurance Plan: Aegon Religare.

Page 70 of 82
From Figure 3 we can say that the lowest income slab investors are investing in
Easy life plus i.e. the income slab of 50-1lac. The premium given by them is
Rs.500 only.

The investors under the income slab of 1-3 lac are investing mainly in Mahalife
gold, Dream plan, Kotak smart advantage and in automatic investment plan. In this
income slab we can easily notice that the lower income group is investing in
secured plan and also there premium paying capacity is much lower than the other
group. So to target this income group one should keep a full knowledge and should
push these plans as this plans are safe for investment i.e. the return is gurranted
mostly on all the plans. So we can say this income slab people are risk averser.

Secondly, in the income slab of 4-6lacs the investors starts investing in slightly
risky plan where returns are not gurranted such as saral jeevan, unit plus2 and they
also start investing to secure the future of their child so the investors invested in
Children dream plan and also in health plan.

Then the income slab of 7-9lacs also invested in the most risky plans like unit plus
2 and saral jeevan. As this income group needs some tax advantage and also high
return although these plans are completely depends upon the market scenario. All
the investors under this age group have given high premiums as well.

There is only one investor under the income slab 10-12lacs and he invested a huge
premium of Rs.200000 in children dream plan only. That‟s why we can say that
premium is dependent variable and income is independent.

Page 71 of 82
Figure 4.

Policy opted according to age group

no. of person

1
20- 26- 32- 38- 44- 50- 56-
25 31 37 43 49 55 61

automatic investment plan

dp,ksa,ml,invest assure,sachin century+ 7
sj,ksa,ml,investassure,health saver 6
health saver,cdp,sj,ksa, 14
sj,cdp,term assurance,kotak flexi,ksa,up2 20
ml,ksa,pp(30),invest… 33
elp,up2,dp,ksa,invest assure 19

Figure 4. Policy opted according to age group,

Here,

ELP:Easy life plus,Aviva

ML: Mahalife gold,tata aig

KSA: kotak smart advantage

AIP: Automatic Investment plan

DP: Dream plan, Birla sun life

Aegon Pension plan: Aegon Religare

UP2: Unit Plus 2, SBI life insurance

SJ: Saral Jeevan, Birla Sun Life. PP: Platinum Plus, Birla Sunlife.

CDP: Children Dream Plan, Birla Sunlife. Term Assurance Plan: Aegon Religare.

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From Figure.4 we can conclude that the lower age group that is in the age group of
20-25 are keen to invest in the secured plan with lower premium as in this stage the
income tends to low that‟s why they prefer to not to loose the money invested. As
we can see from the chart they have invested in invest assure and the most popular
dream plan where 3% return is gurranted, its not dependent on market condition
and it gives 3% return whatsoever the condition is. Next easy life plus of Aviva is a
simpler plan where can pay premium as low as Rs.500 per month.

In the age group of 26-31 there is not so change in investment part they invested in
traditional and secured plan like TATA Mahalife Gold where one has to pay the
premium for 15 years and after 5 years of paying premium the company started
paying the return and the company returns up to 100 years of age of the investor.
The plans like Kotak smart advantage, platinum plus, invest assure is also a
gurranted return plan but in platinum plus the minimum amount to be invested as
premium is Rs.100000 but here the highest NAV(Net Asset Value) is gurranted.

In the age group of 32-37 we can see that the investors suddenly change their taste
of investment in a bit riskier plans like Saral jeevan, it‟s a simple ULIP. And we
can also they start investing on their children i.e. they invested in children dream
plan of Birla that is also a very safe plan for any investor. If we see the premium
paid in this age group we can say that it is much higher because the income goes
higher in this age group.

And in the age group of 38-43 they start investing in health saver plan that is a
health plan so we can say in this people start investing in health plan so to pitch a
health plan would be better. And rest we can see that they invested in ULIP which
are not gurranted and risky

And from 50-60 years we can see that they have again started investing gurranted
return plan such as Dream plan, Mahalife gold, Kotak smart advantage, Invest
assure optima. As income is highest and the in this age they plan for saving for
their retirement so this plans are safest for investment.

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Contingency Table 1
Income Plan1 Plan Plan 3 Plan 4 Plan 5 Plan 6 Plan Tota
2 7 l
50-.99 0 0 0 0 0 0 1 1
Lakh
1-3.99 lakh 0 1 0 0 8 1 9 19
4-6.99 1 0 0 3 6 1 3 14
Lakh
7-9.99 lakh 0 0 0 0 2 0 0 2
10-12.99 L 0 0 0 1 0 0 0 1
Total 1 1 0 4 16 2 13 37

Income fo fe (fo-fe)2 (fo-fe)2 / fe Total

(.5-.99 Lakh)
1 0 .027 .00072 .026
2 0 .027 .00072 .026
3 0 0 0 0
4 0 0.108 .01166 .108
5 0 0.432 .1866 .432
6 0 0.054 .0029 .0537
7 1 0.351 .4212 1.20 1.85
Income (1- fo Fe (fo-fe)2 (fo-fe)2 / fe
3.99 Lakh)
1 0 0.513 .2631 .495
2 1 0.513 .487 .949
3 0 0 0 0
4 0 2.054 4.218 2.054
5 8 8.216 .0466 .0056
6 1 1.027 .3073 .299
7 9 6.675 5.405 .8097 4.61

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Income fo Fe (fo-fe)2 (fo-fe)2 / fe Total
(4-6.99 Lakh)
1 1 .378 .3868 1.023
2 0 .378 .1428 .377
3 0 0 0 0
4 3 1.513 2.211 1.461
5 6 6.054 .0029 .00047
6 1 0.756 .0595 .078
7 3 4.918 3.678 .747 3.68
Income fo Fe (fo-fe)2 (fo-fe)2 / fe
(7-9.99 lakh)
1 0 .054 .0029 .054
2 0 .054 .0029 .054
3 0 0 0 …..
4 0 .216 .0466 .215
5 2 .864 1.29 1.49
6 0 .108 .0116 .107
7 0 .702 .4928 .701 3.59
Income fo fe (fo-fe)2 (fo-fe)2 / fe
(10-12.99 lakh)
1 0 0.027 0.00729 .27
2 0 0.027 0.00729 .27
3 1 0 1 ….
4 0 0.108 .11664 1.08
5 0 0.432 .186624 .432
6 0 0.054 .002916 .054
7 0 .0351 .13201 3.76 5.87
2
*Chi square: ∑(fo-fe) /fo = 6.112.

Degree of freedom= (7-1)*(5-1) =24

From the Chi Square distribution table at level of .05 sig. level the value of chi
square is 13.848

From the survey the calculative chi square is 19.60

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 Figure.5 13.848 19.60

So, from figure 3 and 4 and from the chi square we can conclude that the
hypothesis

1) H0 :μ= Age, Income, Premium and Plan category are independent

H1: μ = Age, income, premium and plan category are dependent.

Alternate hypothesis is accepted.

From the above calculation it can be concluded that all the factors age, Income,
Premium and Plan category are dependent.

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Experience with Religare Insurance Broking Limited:
It was an awesome experience with Religare Insurance Broking Limited with all
the knowledgeable people like Mr. Pushker Saxena, Mr. Ashok Thapa and Mr.
Sumit Mahendru of Life insurance section. Before going to the market there was 1
week classroom session in Birla sun Life Insurance and in Aviva. It was great
learning about different products. After that I started my hunting in the market for
getting new customers. I have done my selling in GI which helped to built up a
very good relation with the GI people . The most unforgettable experience I have
ever experienced is talking with the Manager of United India Insurance. I have
built up a corporate relation (b2b) with Religare and United India Insurance. From
hanging around here and there in Dehradun like the places Doon Global School,
Govt. Hotel Management Institute, almost all the shops of Rajpur Road,
households, Paonta sahib also and in Doon club a tremendous experience where I
have interacted with many qualified people for selling different policies. Patience
is required while cold calling because the probability of a positive response is 1:25.
Correct time to call is the key factor to make a person listen to you with interest.
That timing is 1 pm to 3 pm, and then 4 pm to 6 pm. One has to be quick witted
with the answers in response of the respondent, if anybody said that he/she was a
student so I motivated him/her with the option of pocket money and if the person is
earning then the way of attracting the person was extra income. In short in Religare
Insurance Broking Limited I have gained ample of knowledge:

Interacting with people confidently

Working under pressure when there is a target to meet.
Communicating with the upper ladder of the
organization politely in every situation.
Working under the Sun.

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Almost the research has been done results comes out to be satisfactory by all the
methods adopted. According to this dissertation there is a great relation among
premium and age, plan category and income of the investors. In a youth age when
the income is much lower than most of the investor goes for lower premium and
secured plan same in case of the old age although the income is not that low but at
that stage of retirement people invest very carefully. And in middle age there is a
craze for high return but unsecured plan and also for the child plan and health plan.
So before going to pitch a plan to a prospective client it would better to analyze
his/her age, income very carefully.

Recommendations:
While filling up the questionnaire I faced a very severe problem where respondents
were not giving the true details of their income and all. So, if anybody conduct this
research further then I recommend them to go to Income Tax office what I could
not done due to time constraint and money also. For carrying out a research it
would not be so difficult to reach the Income Tax office. Secondly, it‟s my humble
request to all the agents, sales person to not to involve in any sales without having
the proper knowledge of the products and do not mislead a prospective and a good
customer and do not sell policies only for earning commission, because
“INSURANCE IS NOT ONLY SELLING but also maintaining
RELATIONSHIP”. The more you will give the more you will get. Now to the
potential customer “Everyone should have health Insurance. I say everyone
should have health care. I'm not selling Insurance.”

Page 78 of 82
 http://en.wikipedia.org/wiki/Insurance on April 8,2009
 Marketing Management Book, ICMR Pg. service marketing
 Business Research Method Book, ICMR, discriminant analysis
 Articles related to insurance in various news paper like Times of India, The
Hindu in Internet
 www.bimaonline.com, May 9th 2009
 www.religare.in
 Database of RIBL in Dehradun
 Richard l. Levin And David S. Rubin, Statistics for Management, chapter
11, pg 598
 Money Outlook, January 2008 edition
 Marketing Management, Kotler & Keller
 Principles of Life Assurance, IC-33 ( New syllabus)
 Service Perspective: Insurance Sector, ppt.

Page 79 of 82
 Annexure:

QUESTIONNAIRE

Dear Sir/Madam,

I am a student of ICFAI Business School, conducting a marketing survey on “COMPARATIVE

ANALYSIS OF DIFFERENT LIFE INSURANCE PRODUCTS BASED ON CUSTOMER’S INCOME
POTENTIAL AND AGE GROUP” in Dehradun CITY”. I request you to fill this questionnaire & I
assure that this data will be used only for study purpose & it will be kept confidential.

1. Name _________________________________

2. Address _________________________________

_________________________________

_________________________________

3. Age

a. Less than 25 c. 35-45

b. 25 – 35 d. 45 and above

4. Qualification

a. Graduate c. Diploma
b. Postgraduate d. Other discipline

5. Occupation
a. Business c. Job holder
b. Professional d. Other

6. What is your average annual income?

a. Up to 1 lakh
b. 1 lakh to 3 lakhs
c. 3 lakhs to 5 lakhs
d. 5 lakhs and more

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 7. Your family size

a. Below 5 members
b. 5 – 10 members
c. Above 10 members

8. Have you taken any life insurance product?

YES NO

If yes

Which company/ies……………………………………………………………………

9. Which are in these?

a. Unit gain plan
b. Invest gain plan
c. Whole life plan
d. Children plan
e. Pension plan
f. Others __________________

Specify the particular name of the plan/s: ……………………………………………

10. Total premium you pay in a particular financial year in each policy?

(a)……………………………………………………….

(b)………………………………………………………

(c)………………………………………………………..

(d)……………………………………………………….

(e)……………………………………………………….

Thank you for giving your valuable time

Interviewer Name: Signature:

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