Summer internship project 2014

Website
www.sbilife.co.in
Summer Internship Project
In todays corporate and competitive world I find that insurance sector has the ma!imum "rowth and
potential as compared to the other sectors.
Insurance has the ma!imum "rowth rate of #0$%0& while as '()* sector has ma!imum 12$1+& of
"rowth rate. ,his "rowth potential attracts me to enter in this sector and S-I .I'/ I0S1230)/ has
"iven me the opportunity to wor4 and "et e!perience in hi"hly competitive and enhancin" sector.
)ompanies now are tappin" a lot of ways to capture the mar4et and hence adoptin" different ways to
hold the lar"e portion of the mar4et.
(y trainin" learnin" is helpin" me a lot to complete my project in order to learn a lot of thin"s of the
corporate. 3s a project trainee the first tas4 "iven to me was to understand the basic renewal of the
premium policy of consumer in order to manipulate the mar4et accordin" to our tar"et competition.
'or this I call to customer.
,his job trainin" also helped me a lot in understandin" the process of 2enewal effective mar4etin"
channels for life insurance.
,he success story of "ood mar4et share of different mar4et or"ani5ations depends upon the
availability of the product and services near to the customer which can be distributed throu"h a
distribution channel. In Insurance sector distribution channel includes only a"ents6advisors or
a"ency holders of the company. If a company li4e S-I .I'/ I0S1230)/ .I) I)I)I
7218/0,I3. 2/.I30)/ .I'/ I0S1230)/ ,3,3 3I* (39 etc. has ade:uate a"ents in the
mar4et they can capture bi" mar4et as compared to the other companies.
Definition
Insurance is a contract by which one party for a compensation called in the premium assumes
particular ris4s of the other party and promises to pay to him or his nominee a certain sum of money
on a specified contin"ency.
INTRODUCATION OF IRDA ACT
(ission
;,o protect the interests of the policyholders to re"ulate promote < ensure orderly "rowth of the
insurance industry < for matters connected therewith or incidental thereto.=
3fter liberali5ation of the insurance sector in 1>>> private players have entered both life < non$life
business in India. ,he Insurance 2e"ulatory < 8evelopment 3uthority ?I283@ was constituted in
3pril 2000 as an autonomous body to re"ulate < develop the business of insurance < reinsurance in
the country in terms of the I283 3ct 1>>>.
8uties 7owers < 'unctions of I283A
.icensin" < re"ulatin" the insurance sector by actin" as an independent < re"ulatory body.
Specifyin" re:uisite :ualifications code of conduct < practical trainin" for insurance
intermediaries < a"ents.
7rotectin" the interest of the policyholders in matters concernin" assi"nin" of policy settlement
of insurance claims etc.
2e"ulatin" investment of funds by insurance companies.
)allin" for information from underta4in" conductin" en:uiries < investi"ations includin" audit
of insurers < other or"ani5ations connected with the insurance business.
2e"ulatin" maintenance of mar"ins of solvency of the insurer.
3djudication of disputes between insurers < intermediaries.
Supervisin" the functionin" of the ,ariff 3dvisory )ommittee.
Life Insurance
.ife Insurance is a contract between person and a life insurance company which provides your
beneficiary with a pre$determined amount in case of your death durin" the contract term.
-uyin" insurance is e!tremely useful if you are the principal earnin" member in the family. In case
of your unfortunate premature demise your family can remain financially secure because of the life
insurance policy that you have purchased.
,he primary purpose of life insurance is therefore protection of the family in the event of death.
,oday insurance is also seen as a tool to plan effectively for your future years your retirement and
for your childrenBs future needs. ,oday the mar4et offers insurance plans that not just cover your life
and but at the same time "row your wealth too.
CONCEPT OF INSURANCE
Insurance is a policy from a lar"e financial institution that offers a person company or other entity
reimbursement or financial protection a"ainst possible future losses or dama"es.
Insurance may be described as a social device to reduce or eliminate ris4s of loss to life and property.
It is a provision which a prudent man ma4es a"ainst inevitable contin"encies loss or misfortune.
1nder a plan of insurance a lar"e number of people associate themselves by sharin" ris4s attached to
individuals. 3s in private life in business also there are dan"ers and ris4s of different 4inds. ,he aim
of all type of insurance is to ma4e provision a"ainst such dan"ers. ,he ris4s which can be insured
a"ainst include fire the perils of sea ?marine insurance@ and death ?life insurance@ and accidents.
3ny ris4 contin"ent upon these may be insured a"ainst at a premium a commensurate with the ris4
involved. ,hus collective bearin" of ris4s is insurance.
Insurance business is divided into four classes such as .ife Insurance 'ire (arine and
(iscellaneous Insurance.
Functions of insurance
7rovide 7rotectionA ,he primary function of insurance is to provide protection a"ainst future ris4
accidents and uncertainty. Insurance cannot chec4 the happenin" of ris4 but can certainly provide for
the losses of ris4. Insurance is actually a protection a"ainst economic loss by sharin" the ris4 with
others.
)ollective bearin" of ris4A Insurance is an instrument to share the financial loss of few amon" many
others. Insurance is a mean by which few losses are shared amon" lar"er number of people. 3ll the
insured contribute the premiums towards a fund and out of which the persons e!posed to a particular
ris4 is paid.
3ssessment of ris4A Insurance determines the probable volume of ris4 by evaluatin" various factors
that "ive rise to ris4. 2is4 is the basis for determinin" the premium rate also.
7rovide certaintyA Insurance is a device which helps to chan"e from uncertainty to certainty.
Insurance is device whereby the uncertain ris4s may be made more certain.
Small capital to cover lar"er ris4A Insurance relieves the businessmen from security investments by
payin" small amount of premium a"ainst lar"er ris4s and uncertainty.
)ontributes towards the development of industries Insurance provides development opportunity to
those lar"er industries havin" more ris4s in their settin" up. /ven the financial institutions may be
prepared to "ive credit to sic4 industrial units which have insured their assets includin" plant and
machinery.
(eans of savin"s and investmentA Insurance serves as savin"s and investment insurance is a
compulsory way of savin"s and it restricts the unnecessary e!penses by the insuredBs 'or the purpose
of availin" income$ta! e!emptions also people invest in insurance.
Source of earnin" forei"n e!chan"eA Insurance is an international business. ,he country can earn
forei"n e!chan"e by way of issue of marine insurance policies and various other ways.
2is4 free tradeA Insurance promotes e!ports insurance which ma4es the forei"n trade ris4 free with
the help of different types of policies under marine insurance cover.
LIFE INSURANCE
.ife insurance may be defined as a contract in which the insurer in consideration of a certain
premium either in a lump sum or by other periodical payments a"rees to pay the assured or to the
person for whose benefit the policy is ta4en the assured sum of money on the happenin" of a
specified event contin"ent on the human life.
.ife insurance is a contract under which the insurer ?Insurance )ompany@ in consideration of a
premium paid underta4es to pay a fi!ed sum of money on the death of the insured or on the e!piry of
a specified period of time whichever is earlier. In case of life insurance the payment for life
insurance policy is certain. ,he /vent insured a"ainst is sure to happen only the time of its happenin"
is not 4nown. So life insurance is 4nown as C.ife 3ssurance. ,he subject matter of insurance is life
of human bein". .ife insurance provides ris4 covera"e to the life of a person. Dn death of the person
insurance offers protection a"ainst loss of income and compensate the titleholders of the policy.
ROLE OF LIFE INSURANCE
Life insurance as an investmentA
Insurance products yield more than any other investment instruments and it also provides added
incentives or bonus offered by insurance companies.
Life insurance as ris coverA
Insurance is all about ris4 cover and protection of life. Insurance provides a uni:ue sense of security
that no other forms of invest can provide.
Life insurance as ta! p"annin#A
Insurance serves as an e!cellent ta! savin" mechanism too.
I$PORTANCE OF LIFE INSURANCEA
Protection a#ainst untime"% &eathA
.ife insurance provides protection to the dependents of the life insured and the family of the assured
in case of his untimely death. ,he dependents or family members "et a fi!ed sum of money in case
of death of the assured.
Savin# for o"& a#eA
3fter retirement the earnin" capacity of a person reduces. .ife insurance enables a person to enjoy
peace of mind and a sense of security in his6her +
Promotion of savin#sA
.ife insurance encoura"es people to save money compulsorily. When life policy is ta4en the assured
is to pay premiums re"ularly to 4eep the policy in force and he cannot "et bac4 the premiums only
surrender value can be returned to him. In case of surrender of policy the policyholder "ets the
surrendered value only after the e!piry of duration of the policy.
Initiates investmentsA
.ife Insurance )orporation encoura"es and mobili5es the public savin"s and canali5es the same in
various investments for the economic development of the country. .ife insurance is an important tool
for the mobili5ation and investment of small savin"s.
Socia" Securit%A
.ife insurance is important for the society as a whole also. .ife insurance enables a person to provide
for education and marria"e of children and for construction of house. It helps a person to ma4e
financial base for future.
Ta! 'enefitA
1nder the Income ,a! 3ct premium paid is allowed as a deduction from the total income under
section %0).
A'OUT T(E CO$PAN)
SBI Life Insurance Company Ltd
S-I .ife Insurance is a joint venture between State -an4 of India and -07 7aribas 3ssurance S-I
owns #4& of the total capital and -07 7aribas 3ssurance the remainin" 2E&. S-I .ife Insurance
has an authori5ed capital of 2s. 2000 crore and a paid up capital of 2s.1000 crore. State -an4 of
India enjoys the lar"est ban4in" franchise in India. 3lon" with its E 3ssociate -an4s State -an4
*roup has the unrivalled stren"th of over 1E000 branches across the country ar"uably the lar"est in
the world.
3lon" with its + 3ssociate -an4s State -an4 *roup has the unrivalled stren"th of over 1%000
branches across the country ar"uably the lar"est in the world.
$u"ti*&istri+ution $o&e"
S-I .ife has a uni:ue multi$distribution model encompassin" vibrant -anc assurance 2etail 3"ency
Institutional 3lliances and )orporate Solutions distribution channels.
S-I .ife e!tensively levera"es the State -an4 *roup relationship as a platform for cross$sellin"
insurance products alon" with its numerous ban4in" product pac4a"es such as housin" loans and
personal loans. S-Is access to over 100 million accounts across the country provides a vibrant base
for insurance penetration across every re"ion and economic strata in the country thus ensurin" true
financial inclusion. 3"ency )hannel comprisin" of the most productive force of over E%000
Insurance 3dvisors offers door$to$door insurance solutions to customers.
2easons to select S-I .ife as people preferred insurance company.
)ustomer Satisfaction $ many of their customers who have bou"ht an insurance policy with
them have bou"ht a second oneF
'inancially sound with over a 100 years of ban4in" e!perience when people trusted company
with their money why would they trust somebody else with their protection needs.
3ffordability
/asy to buy ?accessibility@
,rust < reliability
7reparin" for uncertainties S-I life Insurance company is came out with the different insurance
policy as a solution for dele"atin" worries. It reimburses people for levered losses in the event of an
unfortunable occurrence such as illness accident < death. 3t the same time it can encoura"e safety
measure provide investment capital lend money < help to reduce an!iety for society at lar"e
'ANCASSURANCE
-ancassurance is the distribution of insurance products throu"h the ban4Bs distribution channel. It is a
phenomenon wherein insurance products are offered throu"h the distribution channels of the ban4in"
services alon" with a complete ran"e of ban4in" and investment products and services. ,o put it
simply -ancassurance tries to e!ploit syner"ies between both the insurance companies and ban4s.
'ANCASSURANCE IN INDIA
-ancassurance in India is a very new concept but is fast "ainin" "round. In India the ban4in" and
insurance sectors are re"ulated by two different entities ?ban4in" by 2-I and insurance by I283@
and bancassurance bein" the combinations of two sectors comes under the purview of both the
re"ulators. /ach of the re"ulators has "iven out detailed "uidelines for ban4s "ettin" into insurance
sector
T(E INSURANCE RE,ULATOR) AND DE-ELOP$ENT
AUT(ORIT) . IRDA / ,UIDELINES FOR T(E 'ANCASSURANCE
ARE0
/ach ban4 that sells insurance must have a chief insurance e!ecutive to handle all the
insurance activities.
3ll the people involved in sellin" should under$"o mandatory trainin" at an institute
accredited by I283 and pass the e!amination conducted by the authority.
)ommercial ban4s includin" cooperative ban4s and re"ional rural ban4s may become
corporate a"ents for one insurance company.
-an4s cannot become insurance bro4ers
AD-ANTA,ES TO 'AN1S
7roductivity of the employees increases.
-y providin" customers with both the services under one roof they can improve overall
customer satisfaction resultin" in hi"her customer retention levels.
Increase in return on assets by buildin" fee income throu"h the sale of insurance products.
)an levera"e on face$to$face contacts and awareness about the financial conditions of
customers to sell insurance products.
-an4s can cross sell insurance products /"A ,erm insurance products with loans.
Pa%ment Option of Rene2a" Pa%ment Of S+i Life Insurance
8I2/), 2/(I,,30)/ 3, S-I .I'/ -230)GA Hou can ma4e premium
payments by )he:ue6 8emand draft at your nearest S-I .ife branch. Iindly
note that you can pay premiums at any of the S-I .ife branch across India.
-H 7DS, D2 )D12I/2A Hou can send your che:ues and demand drafts for
premium payments to any of the Dffice by post or courier. 3 receipt
ac4nowled"in" your payment will be sent to your communication address
directly.
/lectronic )learin" Service ?/)S@ J (andate 3uto debit throu"h /)S is a
facility throu"h which premiums will be debited to your ban4 account
automatically. ,his facility is currently available in locations. 7olicy holders
havin" a ban4 account in these locations and participatin" in the clearin" house
operations can re"ister for this facility by submittin" the /)S (andate
form alon" with a cancelled che:ue in which the (I)2 number is mentioned.
Hou can submit this mandate at any of our branch offices or mail it to our
communication address as mentioned below
S-I .ife Insurance )o. .td.
)entral 7rocessin" )entre
Iapas -havan 7lot K3
Sector$10 )-8 -elapur
0avi (umbai$ 400E14
Dnline 7aymentsA 0et ban4in" customers of State -an4 of India and
our partner ban4s can re"ister for this facility. 3ll you have to do is to add S-I
.ife as your biller ?S-I .ife is listed as a national biller@ and provide your
7olicy details. 3lternately you can also re"ister throu"hwww.billdes4.com or
by submittin" the -ill des4 re"istration form to your nearest S-I .ife branch
SI$/', for State -an4 and 3ssociate -an4s 3ccount Golders A
,his facility is available for all S-I and si! 3ssociate ban4Cs account holders
only. ,o avail this facility a policyholder re:uires submittin" the SI$/',
(andate to his6her ban4 branch. ,his is an automated payment mechanism on
successful re"istration of the facility at ban4 end payment will be debited on
due date and will be remitted by S-I to S-I .ife on ne!t day. 1nder this
payment mode ban4 officials intervention is limited up to the re"istration of
the mode in ban4s system. 'or deactivation of the facility a policyholder
needs to submit the deactivation re:uest to his 6her ban4 branches.
'enefits
I $aturit% 'enefitsA
0o benefits are payable to the survivin" borrower6s on maturity of the term of the policy.
II Death 'enefitA
,he life cover sum assured is payable to the -an4 ?as the -an4 is the assi"nee@. Surplus amount after
adjustin" the dues if any will be paid to the le"al heir by the -an4
0o death benefit is available for suicide within the first year of the policy.
III Ta! 'enefit
Hou are eli"ible for ,a! benefit for the premium payment u6s %0 ) and 10 ?10 8@ of I, 3ct.
SBI LIFE INSURANCE CO LTD
S3OT ANAL)SIS
S-I .I'/ I0S1230)/ )D. .,8 3, 3 *.30)/
Loint venture between State ban4 of India and -07 7aribas 3ssurance.
S-I is the lar"est ban4 in India and -07 7aribas 3ssurance is 'ranceMs lar"est Insurance
company.
InvestmentsA S-I$#E& and -07 7aribas 24&.
,he )ompany started its operations in 2>
th
(arch2001.
7rovides .ife Insurance Solutions to Individuals and )orporate.
S,3,/ -30I D' I08I3 A
.ar"est and oldest ban4in" franchise of India datin" bac4 to 1%0E 38.
E 3ssociate -an4s 1E000 -ranches all over the country.
STREN,T(S
0o.1 7rivate .ife Insurance )ompany in India.
.evera"es the State -an4 *roup 2elationship as a platform for cross$sellin" insurance
products.
3s it sells its products throu"h banc$assurance division of S-I therefore less need on
spendin" money for establishin" separate branch offices.
I283 has never banned any of S-I .ifes product.
7rofitable business "rowth demonstrated by all 4ey distribution channels.
)ertifications of ISD >001A2000 ISD 2#00A200+ ?Information security@
Superior )laims Settlement 7rocess ?certified by ISD >001A2000@.
3EA1NESSES
.ess sales force than others ?.I) N K field advisor S-I N 1field advisor@
.ow productivity of banc$assurance people.
7eople at top mana"ement6decision ma4in" level are from S-I. So typical 7S1 attitude in
many aspects.
Gassle free online purchase of insurance policy is not available
Is less a""ressive in "eneratin" business compared to other private life insurance players.
Dver dependence on the banc$assurance channels.
.ess branch office compared to others.
OPPORTUNITIES
It has an ed"e over .I) as far as service is concerned. So it can "rab more mar4et share from
.I) by "ivin" it a tou"h competition.
0ot so much re:uirement on establishment of -rand ?already have a "ood brand ima"e of
S-I@.
T(REATS
Gu"e competition on from other pre$e!istin" 22 players in the .ife Insurance sector in India.
0ew entrants in the pipe line of the life insurance business.
S'I LIFE LOCATION OF OFFICES0
S-I has a hu"e networ4 of offices for providin" service related to Insurance all overthe country.
.ocation
Re#istere& officeA
S-I .ife Insurance )o. .td. )entral 7rocessin" )entre Iapas -hawan Sector 10 )-8 -elapur
0avi (umbai 400E14.,elephone 0oA 022$EE4+ E241
/mailA infoOsbilife.co.in
Corporate OfficeA
S-I .ife Insurance )o. .td P0atrajP (.Q. 2oad < Western /!press Gi"hway Lunction 3ndheri
?/ast@ (umbai $ 400 0E>
Summer trainin# officeA
Sbi .ife Insurance )o. .td.
3sho4 (ar" )$Scheme
Laipur.
Websites
www.sbilife.co.in