1.

3) INDUSTRY PROFILE
MEANING OF INSURANCE
Insurance may be described as a social device to reduce or eliminate risk of loss to life
and property. Insurance is a collective bearing of risk. Insurance is a financial device to
spread the risks and losses of few people among a large number of people, as people
prefer small fixed liability instead of big uncertain and changing liability.
Insurance can be defined as a legal contract between two parties whereby one party
called insurer undertakes to pay a fixed amount of money on the happening of a
particular event, which may be certain or uncertain. The other party called insured pays
in exchange a fixed sum known as premium.
Insurance is desired to safeguard oneself and ones family against possible losses on
account of risks and perils. It provides financial compensation for the losses suffered due
to the happening of any unforeseen events.
IMPORTANCE OF INSURANCE
Insurance constitutes one of the major segments of the financial market.
Insurance services play predominant role in the process of financial Intermediary. Today
insurance industry is one of the most growing sectors in India. There is lot of potential in
the Indian Insurance Industry.
There are many issues, which require study. The scope of the study of Insurance industry
of India would be very great as there are ongoing Developments in the industry after the
opening of the sector.
One of the major issues is the effects on LIC after the entry of private players in the
market. Though market share of LIC has been affected, it has improved in terms of
efficiency.
There are number of other hot topics like penetration of Health Insurance, Rural
marketing of insurance, new distribution channels, new product ranges, insurance
brokers regulation, incentive scheme of development officers of LIC etc. So it offers lot
of scope for studying the insurance industry.
Right now the insurance industry has great opportunities in a country like India or China
which huge population. Also the penetration of insurance in India is very low in both life
and non-life segment so there is lot potential to be tapped. Before starting the discussion
on insurance industry and related issues, we have to start with the basics of insurance. So
first we understand what is insurance? How the word insurance is different from the
word assurance? Etc.

HISTORY OF INSURANCE
The concept of insurance is believed to have emerged almost 4500 years ago in the
ancient land of Babylonia where traders used to bear risk of the carvan by giving loans,
which were later repaid with interest when the goods arrived safely.
The concept of insurance as we know today took shape in 1688 at a place called Lloyds
Coffee House in London where risk bearers used to meet to transact business. This coffee
house became so popular that Lloyds became the one of the first modern insurance
companies by the end of the eighteenth century.
Marine insurance companies came into existence by the end of the eighteenth century.
These companies were empowered to write fire and life insurance as well as marine. The
Great Fire of London in 1966 caused huge loss of property and life. With a view to
providing fire insurance facilities,
Dr. Nicholas Barbon set up in 1967 the first fire insurance company known as the Fire
office.
Life insurance in its modern form came to India from England in 1818. The Oriental Life
Insurance Company was the first insurance company to be set up in India to help the
widows of European community. The insurance companies, which came into existence
between 1818 and 1869, treated
Indian lives as subnormal and charged an extra premium of 15 to 20 per cent. The first
Indian insurance company, the Bombay Mutual Life
Assurance Society came into existence in 1870 to cover Indian lives at normal rates.
The Insurance Act, 1938, the first comprehensive legislation governing both life and nonlife branches of insurance were enacted to provide strict state control over insurance
business. This amended insurance Act looked into investments, expenditure and
management of these companies.
By the mid- 1950s there were 154 Indian insurers, 16 foreign insurers, and 75 provident
societies carrying on life insurance business in India. Insurance business flourished and
so did scams, irregularities and dubious investment practices by scores of companies. As
a result the government decided to nationalize the life assurance business in India. The
Life Insurance
Corporation of India (LIC) was set up in 1956. The nationalization of life insurance was
followed by general insurance in 1972.

MEANING OF LIFE INSURANCE

There are three parties in a life insurance transaction: the insurer, the insured, and the
owner of the policy (policyholder), although the owner and the insured are often the same
person.
Another important person involved in a life insurance policy is the beneficiary. The
beneficiary is the person or persons who will receive the policy proceeds upon the death
of the insured.
Life insurance may be divided into two basic classes term and permanent.
Term life insurance provides for life insurance coverage for a specified term of

years for a specified premium. The policy does not accumulate cash value.
Permanent life insurance is life insurance that remains in force until the policy

matures, unless the owner fails to pay the premium when due.
Whole life insurance provides for a level premium, and a cash value table

included in the policy guaranteed by the company. The primary advantages of

whole life are guaranteed death benefits; guaranteed cash values, fixed and known
annual premiums, and mortality and expense charges will not reduce the cash
value shown in the policy.
Universal life insurance (UL) is a relatively new insurance product intended to

provide permanent insurance coverage with greater flexibility in premium

payment and the potential for a higher internal rate of return. A universal life
policy includes a cash account. Premiums increase the cash account. If you want
insurance protection only, and not a savings and investment product, buy a term
life insurance policy.
If you want to buy a whole life, universal life, or other cash value policy, plan to hold it
for at least 15 years. Canceling these policies after only a few years can more than double
your life insurance costs.

HISTORY OF LIFE INSURANCE

Risk protection has been a primary goal of humans and institutions throughout history.
Protecting against risk is what insurance is all about.
Over 5000 years ago, in China, insurance was seen as a preventative measure against
piracy on the sea. Piracy, in fact, was so prevalent, that as a way of spreading the risk, a
number of ships would carry a portion of another ship's cargo so that if one ship was
captured, the entire shipment would not be lost.
In another part of the world, nearly 4,500 years ago, in the ancient land of Babylonia,
traders used to bear risk of the caravan trade by giving loans that had to be later repaid
with interest when the goods arrived safely.
Life insurance came about a little later in ancient Rome, where burial clubs were formed
to cover the funeral expenses of its members, as well as help survivors monetarily. With
Rome's fall, around 450 A.D., most of the concepts of insurance were abandoned, but
aspects of it did continue through the Middle Ages, particularly with merchant and artisan
guilds. These provided forms of member insurance covering risks like fire, flood, theft,
disability, death, and even imprisonment.
During the feudal period, early forms of insurance ebbed with the decline of travel and
long-distance trade. But during the 14th to 16th centuries, transportation, commerce, and
insurance would again reemerge.
Insurance in India can be traced back to the Vedas. For instance, yogakshema, the name
of Life Insurance Corporation of India's corporate headquarters, is derived from the Rig
Veda. The term suggests that a form of "community insurance" was prevalent around
1000 BC and practiced by the Aryans.
And similar to ancient Rome, burial societies were formed in the Buddhist period to help
families build houses, and to protect widows and children.
Modern Insurance
Illegal almost everywhere else in Europe, life insurance in England was vigorously
promoted in the three decades following the Glorious Revolution of 1688. The type of
insurance we see today owes its roots to 17th century England. Lloyd's of London, or as
they were known then, Lloyd's Coffee House, was the location where merchants, ship
owners and underwriters met to discuss and transact business deals.
While serving as a means of risk-avoidance, life insurance also appealed strongly to the
gambling instincts of England's burgeoning middle class.
Gambling was so rampant, in fact, that when newspapers published names of prominent
people who were seriously ill, bets were placed at Lloyds on their anticipated dates of

death. Reacting against such practices, 79 merchant underwriters broke away in 1769 and
two years later formed a New Lloyds Coffee House that became known as the real
Lloyds. Making wagers on people's deaths ceased in 1774 when parliament forbade the
practice.
Insurance moves to America
The U.S. insurance industry was built on the British model. The year 1735 saw the birth
of the first insurance company in the American colonies in
Charleston, SC. The Presbyterian Synod of Philadelphia in 1759, sponsored the first life
insurance corporation in America for the benefit of ministers and their dependents. And
the first life insurance policy for the general public in the United States was issued, in
Philadelphia, on May 22, 1761.
But it wasn't until 80 years later (after 1840), that life insurance really tookoff in a big
way. The key to its success was reducing the opposition from religious groups.
In 1835, the infamous New York fire drew people's attention to the need to provide for
sudden and large losses. Two years later, Massachusetts became the first state to require
companies by law to maintain such reserves. The great Chicago fire of 1871 further
emphasized how fires can cause huge losses in densely populated modern cities. The
practice of reinsurance, wherein the risks are spread among several companies, was
devised specifically for such situations.
With the creation of the automobile, public liability insurance, which first made its
appearance in the 1880s, gained importance and acceptance?
More advancement was made to insurance during the process of industrialization. In
1897, the British government passed the Workmen's Compensation Act, which made it
mandatory for a company to insure its employees against industrial accidents.
During the 19th century, many societies were founded to insure the life and health of their
members, while fraternal orders provided low-cost, members only insurance. Even today,
such fraternal orders continue to provide insurance coverage to members, as do most
labor organizations. Many employers sponsor group insurance policies for their
employees, providing not just life insurance, but sickness and accident benefits and oldage pensions. Employees contribute a certain percentage of the premium for these
policies.

BENEFITS OF LIFE INSURANCE

1) Risk cover: -Life Insurance contracts allow an individual to have a risk cover against
any unfortunate event of the future.
2) Tax Deduction: -Under section 80C of the Income Tax Act of 1961 one can get tax
deduction on premiums up to one lakh rupees. Life Insurance policies thus decrease the
total taxable income of an individual.
3) Loans: -An individual can easily access loans from different financial institutions by
pledging his insurance policies.
4) Retirement Planning: -What had provided protection against the financial
consequences of premature death may now be used to help them enjoy their retirement
years.
Moreover the cash value can be used as an additional income in the old age.
5) Educational Needs: -Similar to retirement planning the cash values that flow from
ones life insurance schemes can be utilized for educational needs of the insurer or his
children.

ROLE OF LIFE INSURANCE IN THE GROWTH OF THE ECONOMY

The Life Insurance Industry has an enviable track record among public sector units. It has
a Consistent profit and dividend paying record accompanied by a steady growth in its
financial resources. Through investments in the Government sector and socially- oriented
sectors the Industry has contributed immensely to the nation's development. The industry
is recognized as one of the largest financial Institutions in the country. The ventures
initiated by the industry in the areas of Mutual Fund,
Housing Finance has done exceedingly well in recent years. To protect the country's
foreign exchange reserves, the reinsurance arrangement are so organized that maximum
retention is made possible within the country while at the same time protecting interests
of the policy holders.

ROLE OF IRDA
MISSION
To protect the interests of the policyholders, to regulate, promote
and ensure orderly growth of the insurance industry and for matters
connected therewith or incidental thereto

The Insurance Act, 1938 had provided for setting up of the Controller of Insurance to act
as a strong and powerful supervisory and regulatory authority for insurance. Post
nationalization, the role of Controller of Insurance diminished considerably in
significance since the Government owned the insurance companies. But the scenario
changed with the private and foreign companies foraying in to the insurance sector. This
necessitated the need for a strong, independent and autonomous Insurance Regulatory
Authority was felt. As the enacting of legislation would have taken time, the then
Government constituted through a Government resolution an Interim Insurance
Regulatory Authority pending the enactment of a comprehensive legislation.
The Insurance Regulatory and Development Authority Act, 1999 is an act to provide for
the establishment of an Authority to protect the interests of holders of insurance policies,
to regulate, promote and ensure orderly growth of the insurance industry and for matters
connected therewith or incidental thereto and further to amend the Insurance Act, 1938,
the Life Insurance Corporation Act, 1956 and the General insurance Business
(Nationalization) Act, 1972 to end the monopoly of the Life Insurance Corporation of
India (for life insurance business) and General Insurance Corporation and its subsidiaries
(for general insurance business). The act extends to the whole of India and will come
into force on such date as the Central Government may, by notification in the Official
Gazette specify. Different dates may be appointed for different provisions of this Act.

The Act has defined certain terms; some of the most important ones are as follows:
Appointed day means the date on which the Authority is established under the act.
Authority means the established under this Act. Interim Insurance Regulatory Authority
means the Insurance Regulatory Authority set up by the Central Government through
Resolution

No.

17(2)/

94-lns-V

dated

the

23rd

January,

1996.

Words and expressions used and not defined in this Act but defined in the Insurance Act,
1938 or the Life Insurance Corporation Act, 1956 or the General Insurance Business
(Nationalization) Act, 1972 shall have the meanings respectively assigned to them in
those Acts. A new definition of "Indian Insurance Company" has been inserted. "Indian
insurance company" means any insurer being a company
(a)

Which

is

formed

and

registered

under

the

Companies

Act,

1956

(b) in which the aggregate holdings of equity shares by a foreign company, either by
itself or through its subsidiary companies or its nominees, do not exceed twenty-six
percent, paid up capital in such Indian insurance company
(c) Whose sole purpose is to carry on life insurance business, general insurance business
or re-insurance business?

COMPANY PROFILE
9

1 A.COMPANY PROFILE OF RELIANCE LIFE INSURANCE

ABOUT FOUNDER OF THE COMPANY
Few men in history have made as dramatic a contribution to their countrys economic
fortunes as did the founder of Reliance, Shri. Dhirubhai H Ambani. Fewer still have left
behind a legacy that is more enduring and timeless.
As with all great pioneers, there is more than one unique way of describing the true
genius of Dhirubhai: The corporate visionary, the unmatched strategist, the proud patriot,
the leader of men, the architect of Indias capital markets, the champion of shareholder
interest.
But the role Dhirubhai cherished most was perhaps that of Indias greatest wealth creator.
In one lifetime, he built, starting from the proverbial scratch, Indias largest private sector
enterprise.
When Dhirubhai embarked on his first business venture, he had a seed capital of barely
US$ 300 (around Rs 14,000). Over the next three and a half decades, he converted this
fledgling enterprise into a Rs 60,000 crore colossusan achievement which earned
Reliance a place on the global Fortune 500 list, the first ever Indian private company to
do so.
Dhirubhai is widely regarded as the father of Indias capital markets. In 1977, when
Reliance Textile Industries Limited first went public, the Indian stock market was a place
patronised by a small club of elite investors which dabbled in a handful of stocks.
Undaunted, Dhirubhai managed to convince a large number of first-time retail investors
to participate in the unfolding Reliance story and put their hard-earned money in the
Reliance Textile IPO, promising them, in exchange for their trust, substantial return on
their investments. It was to be the start of one of great stories of mutual respect and
reciprocal gain in the Indian markets.
Under Dhirubhais extraordinary vision and leadership, Reliance scripted one of the
greatest growth stories in corporate history anywhere in the world, and went on to
become Indias largest private sector enterprise.
Through out this amazing journey, Dhirubhai always kept the interests of the ordinary
shareholder uppermost in mind, in the process making millionaires out of many of the
initial investors in the Reliance stock, and creating one of the worlds largest shareholder
families.

10

ABOUT RELIANCE LIFE INSURANCE

Reliance Life Insurance offers you products that fulfill your savings and protection needs.
Our aim is to emerge as a transnational Life Insurer of global scale and standard.
Reliance Life Insurance is an associate company of Reliance Capital Ltd., a part of
Reliance - Anil Dhirubhai Ambani Group. Reliance Capital is one of Indias leading
private sector financial services companies, and ranks among the top 3 private sector
financial services and banking companies, in terms of net worth. Reliance Capital has
interests in asset management and mutual funds, stock broking, life and general
insurance, proprietary investments, private equity and other activities in financial
services.
Reliance - Anil Dhirubhai Ambani Group also has presence in Communications, Energy,
Natural Resources, Media, Entertainment, Healthcare and Infrastructure.
VISION & MISSION
Vision
Empowering everyone live their dreams.
Mission
Create unmatched value for everyone through dependable, effective, transparent and
profitable life insurance and pension plans.
GOAL
Reliance Life Insurance would strive hard to achieve the 3 goals mentioned below:

Emerge as transnational Life Insurer of global scale and standard.

Create best value for Customers, Shareholders and all Stake holders.

Achieve impeccable reputation and credentials through best business practices.

11

ACHIVEMENTS OF RELIANCE LIFE INSURANCE COMPANY

1. RLIC closed the last financial year with New Business Premium of Rs 3513
Crores.
2. For 3 successive years, since inception, the Company has been amongst the fastest
growing Companies in the Life Insurance Industry achieving a growth rate of
28% in the last financial year against a market growth of -6%. In the Individual
Business segment, the company achieved a growth rate of 59% in terms of WRP
against the private industry growth of 1%.
3. Reliance Life has been one of the fastest gainers in market share growing from
1.9% amongst private players in Mar'06 to 10.3% as of Mar'09. This has resulted
in the Company growing to becoming the 4th largest private player in just two
years starting at position of 11.
4. The Company has been the fastest company to reach the 3 million policy mark
and was the 3rd largest private insurer in terms of Policy count in 2008-09
5. Reliance Life has accomplished a large distribution ramp-up in the Industry in a
short span of time by opening 1145 branches in just over 2 year.
6. RLIC continues to be amongst the foremost Life Insurance companies in India to
be certified ISO 9001:2000 for all the processes.
7. Awarded the Jamnalal Bajaj Uchit Vyavahar Puraskar 2007- Certificate of Merit
in the Financial Services category by Council for Fair Business Practices (CFBP).
8. The Company has been the fastest company to reach the 3 million policy mark
and was the 3rd largest private insurer in terms of Policy count in 2008-09.
9. The Company has also won the DL Shah Quality Council of India Commendation
Award in the services category in feb 2008 for its work on promoting 'self help
channels for service'

LEADERSHIP TEAM
BOARD OF DIRECTORS
Gautam Doshi, Director
Gautam is the Group Managing Director of Reliance Anil Dhirubhai Ambani Group and
Director of Reliance Life Insurance Company Limited.

12

In his long and illustrious career spanning 30 years, Gautam has held key positions in
various organisations such as M/s. Bansi S. Mehta, RSM & Co. and Ambit Corporate
Finance Pvt. Ltd. Presently, as a Board member of various reputed public limited
companies, Gautam continues to power the industry with his profound knowledge and
expertise.
Gautam, a qualified Chartered Accountant, has served as the Chairman of the Institute of
Chartered Accountants of India for the year 198283. He was also elected to the Council
of the Institute of Chartered Accountants of India for two consecutive terms spanning
over 1992 to 1998.

Satya Pal Talwar, Director

Satya Pal is the Director of Reliance Life Insurance Company Limited. He holds an
experience of more than 35 years in operations and policy formulation.
Through his distinguished service in the financial industry, Satya Pal has served as the
Chairman and Managing Director of renowned organisations such as Bank of Baroda,
Union Bank of India and Oriental Bank of Commerce. His in-depth knowledge of the
sector has seen him rise quickly into pivotal positions at advisory and board levels in
Indian and as well Global organisations such as SEBI, IDBI and MasterCard
International. He has also held the coveted position of Deputy Governor of RBI from
1994 to 2001.
Satya Pal holds a degree in Law. He is a Certified Associate of the Indian Institute of
Bankers and a member of the Indian Council of Arbitration.

Saumen Ghosh, Group President

Saumen is currently the Group President of Reliance Capital Limited.
Saumen has worked in the UK for one of the leading Chartered Accountancy firms and
then moved to Australia to join a subsidiary of the Allianz Group where he held various
senior positions in the finance and international division. In his immediate past
assignment, before joining Reliance Capital Limited, Saumen was responsible for the
overall Allianz operations in India and Middle East.
Saumen is a qualified Chartered Accountant and is a member of the Institute of Chartered
Accountant in England & Wales and Australia.

Malay Ghosh President

13

Malay leads all activities at Reliance Life Insurance Company Limited Life and his key
focus is on rapid expansion of all channels and accelerating the companys growth
trajectory.
Malay has over 24 years of work experience in the insurance industry. He has worked for
17 years with LIC across various functions and for 7 years with Bajaj Allianz Life
Insurance where he was last designated Head of Sales.
Malay holds a Masters degree in statistics.

Maneesha Thakur, Chief Human Resources Officer

Maneesha in her role as the Chief Human Resource Officer at Reliance Life Insurance
Company Limited, has developed a performance driven and employee centric culture.
She has been at the forefront of the organization growth by facilitating talent acquisition
and management.
Maneesha in her career span of 15 years has worked with companies like SHCIL,
ALLTEL, Transamerica, ICICI Bank and VSNL.
In addition to an MA in English Literature, Maneesha holds a Post Graduate Diploma in
Personnel Management & Industrial Relations from XLRI, Jamshedpur.
C Mohan, Chief Technology Officer
C Mohan is the Chief Technology Officer (CTO) of Reliance Life Insurance Company
Limited and he is responsible for Information Technology Strategy Formulation and
Deployment.
Mohan is an Engineering Graduate and holds many International IT Certifications.
Mohan has over 12+ years of IT Experience of which he spend more than 7+ years
Executive Management Experience in overseas. He worked with Cathay Pacific Airways
and Computer Sciences Corporation in Asia Pacific Role at Singapore before he joined
Reliance Life.
In Year 2008 he has been awarded as Pioneer CIO by CIOL-DataQuest and Bold 100
CIO by IDG-CIO Forum. He also received the Early SOA Adopter Award from IBM.
He has recently been selected as a honoree in Global CIO 100 2009 Award Summit to be
held in Colorado, USA.

R Rangarajan, Chief Investment Officer

14

Rangarajan is the Chief Investment Officer at Reliance Life Insurance Company Limited.
He alongwith his team, strives to give the best possible returns on investments to
shareholders and policyholders, keeping in mind their appetite for risk. Rangarajan draws
on his in-depth knowledge of investment and experience of 25 years to ensure that the
goals of the organisation are metwithout any compromise on the benefits of the
investors.
Prior to being a part of Reliance Life Insurance, Rangarajan worked with AMP Sanmar
Life Insurance as Head Investments for three years. His earlier assignment was with a
large Mutual Fund organization.
Rangarajan is a qualified Chartered Accountant.
S V Sunder Krishnan, Chief Risk Officer
Sunder is the Chief Risk officer for Reliance Life Insurance and is responsible for
overseeing Risk Management, Internal Audit and Compliance functions at Reliance Life
Insurance.
Sunder came with 23 years of experience and knowledge in Internal Audits, Compliance,
Assurance Consulting and Risk Management. He has worked for various leading
organizations such as DSP Merrill Lynch, ING Vysya, Credit Lyonnais, Standard
Chartered, Bank International Indonesia, Ernst & Young and Delloitte at senior and
middle management positions with exposure to businesses and operations in more than
12 countries.
Sunder is a qualified FCA, CISA, and CCSA. He is also the President of Information
Systems Audit Control Association (ISACA-USA), Mumbai Chapter for the year 200708 and was a member of the Board of Advisors to Bombay Chartered Accountants
Society (BCAS) for Internal Audit studies for the year 2005-06.

RELIANCE ADA GROUP

15

HISTORY
Reliance Capital Limited announced the launch of its life insurance business on February
1, 2006. This was after obtaining the required regulatory approvals from the Registrar Of
Companies and the Insurance Regulatory and Development Authority.

16

It was in August 2005 that the ball was set rolling when Reliance Capital Limited, the
financial arm of Reliance Anil Dhirubhai Ambani Group (ADAG) announced the
requisition of 100% shareholding in AMP Sanmar Life Insurance Company Limited; and
the formal transfer of shares took place in October 2005. The company will issue all
policy contracts under the Reliance Life Insurance Company limited name. All the
existing policy contracts also stand transferred to the Reliance Life Insurance entity with
all the original contractual terms and commitments intact.

17

18

SWOT ANALYSIS
STRENGTHS:

Dedicated Employees.
Well Efficient Management.
Strong and popular brand name.
Adaptability to changes.
Goodwill of the company.
Transparency in service.

WEAKNESS:
Lack of good services.
Lack of awareness about insurance among people.
Less coverage in Rural Areas.
Lack of credibility among the people because Reliance life insurance being a
private player

OPPORTUNITIES:
Fast growing economy.
Increasing per capita income in India.
Saving behavior.
High growth of Traditional industry.

THREATS:
Arrival of new entrants in the insurance industry.
Cut throat competition within the industry

19

CORE VALUES
Reliance Life Insurance Company Limited has some core values which are listed as
follows:
1) Result Oriented
2) Performance Driven
3) Customer Focused
4) Learning and Development Oriented
5) Employee Centric
6) Informal and Fun

20

1. B COMPANY PROFILE OF BAJAJ ALLIANZ LIFE INSURANCE

Bajaj Allianz Life Insurance Company limited is a joint venture between two leading
conglomerates Bajaj Auto limited and Allianz AG company, whose total asset value is of
Rs 5900000 cr. Bajaj whose wealth as of now is Rs 8000 cr. group in India, 55 years of
experience, 4th largest group in the world. Above 15000 employees, largest 2 & 3 wheeler
manufacture in India. Allianz established in 1890, who has 115 years of experience in
financial year.
Bajaj Auto is one of the most trusted name is Indian auto for over 55 years. At Bajaj
Allianz customer delight is our guiding principle. Ensuring world-class solutions by
offering customized products with transparent benefits, supported by best technology is
our business philosophy.
Notwithstanding the recession and a volatile stock market, Bajaj Allianz life insurance
posted a profit of Rs 45 cr for financial year 2009 against a loss of Rs 16 cr. in the
previous year.
The company new business premium fell to Rs 4491 cr. in the year against Rs 6674 cr.
recorded in the last year.
We have been able to make a profit of profit of Rs 45 cr. even in these difficult times. Our
new business premium declined by 30% to Rs 4491 cr. because the stock market declined
and we didnt open any new office in FY 09, Bajaj Allianz country manager and Bajaj
Allianz life insurance CEO kamesh Goyal said.
Bajaj Allianz Life Insurance has around 1200 offices and the company would not increase
the number this year too, Goyal said.
The companys renewal premium grew by more than 100% to Rs 6133 cr. in the 20082009 as compared to Rs 3051 cr. in the previous fiscal year, he said.
In the year, Bajaj Allianz life insurance issued 29 lakh policies which were the second
largest in the industry.

Vision
To be the first choice insurer for customers
To be the preferred employer for staff in the insurance industry.
To be the number one insurer for creating shareholder value.

Mission
As a responsible, customer focused market leader, we will strive to understand the
insurance needs of the consumers and translate it into affordable products that deliver
value for money.

21

1.2) TRADITIONAL PLANS OF THE COMPANY

1.2.A )TRADITIONAL PLAN OF RELIANCE LIFE INSURANCE:Life insurance products are designed to suit the requirements of customers.
Fundamentally the product provide for:
Risk cover
Investment
Health cover
In every product, to a certain degree, risk cover is imperative for it to fall under the
category of insurance. Based on the coverage of the product, the premiums are calculated
and the customer pays accordingly. In order to suggest the right product, it is essential for
an agent to understand the requirements of the customer well.
The traditional plans of the company have the following features: Fixed Tenure.
Potential for better returns
Transparency
Flexibility in investment
Flexibility to invest more
Flexibility to skip the premium
Flexibility to choose the cover
High liquidity
Age, term, and sum assured decide the amount of premium.
Top- ups and switches are not allowed
Reliance Life Insurance Company Limited has offered 9
Traditional plans to the customers, which are listed as follows:
1) Reliance Term Plan
2) Reliance Whole Life Plan
3) Reliance Endowment Plan
4) Reliance Special Endowment Plan
5) Reliance Cash Flow Plan
6) Reliance Credit Guardian Plan
7) Reliance Special Credit Guardian Plan
Each of the above traditional plans is discussed as follows:
1) Reliance term plan:This insurance policy is designed for those who only want life cover for the protection of
their family, and do not wish to save for themselves. It can also be useful to business

22

firms that wish to provide financial security to their business against the sudden loss of
partners or valuable manpower. Since there is no saving element or bonus provision, the
premium is very low.
Hence, this is a high-risk plan with a low premium.
Features: a) Purely a term plan
b) Entry age minimum 18 years and maximum 65 year
c) Maximum premium paying term is 30 year
d) Loan facility N.A.
e) Maturity amount = Sum assured
2) Reliance Whole Life Plan: This insurance policy is designed for people who do not wish to avail of any benefits
themselves but wish to create an immediate estate to protect their family by availing of
insurance cover on their life at a very low cost.
Features: a) It is a whole life insurance policy with profits
b) Low cost life cover
c) Maturity age is 85 year or 99 years last birthday as chosen
d) Maturity amount = Sum assured + Vested bonus
e) Tax benefit is available
3) Reliance Endowment Plan: Reliance Life Insurances Reliance Endowment Plan is the key to all your financial
needs. It is an inexpensive and easy way to protect you, your family or your business.
In a nutshell this plan will keep you financially prepared for all the special occasions in
your life - your daughters wedding, your childs university education or even a new
office for your business - by eliminating the burden that a shortage of money creates.
In the event of your untimely death, Reliance Endowment Plan will also assist your loved
ones through this difficult time by the financial support that it provides.
Reliance Endowment Plan also gives you the additional benefit of participating in the
companys profits, which you will receive at the end of the policy period.
Features: a) Entry age minimum is 5 year and maximum 65 year
b) Maturity age minimum is 18 year and maximum 75 year
c) Minimum premium paying term is 5 year and maximum 35 year in case of regular and
in case of single 15 year
d) Minimum sum assured is Rs. 25,000 or as determined by the minimum premium
e) Maximum sum assured is Rs. 5, 00,000 (entry age below 18 years and no limit for
entry age 18 and above)
f) Premium mode annual, half yearly, quarterly and monthly (by salary deduction only)
g) Loan up to 90% of the surrender value of the policy

23

h) Maturity amount = Guaranteed sum assured + Reversionary bonus

4) Reliance Special Endowment Plan: This insurance policy is designed for people who wish to combine savings with extended
security. The unique feature of this policy is that life protection continues for five years
after you have stopped the payment of premium. Payment of sum assured at the end of
premium paying term and extension of life cover thereafter for the full sum assured for a
period of 5 years, are characteristics of the policy.
This plan also participates in the profits.

Features: a) Entry age minimum 12 year and maximum 65 year

b) Minimum sum assured is Rs. 25,000
c) Minimum premium paying term is 10 year and maximum 40 year
d) Unique feature of this policy is that five year life protection continues after you have
stopped the payment of premium
e) Tax benefit is available
f) Under this policy bonus is compounded yearly
g) Loan facility is available
h) Maturity amount = Full sum assured before maturity date +
Vested bonus at the time of maturity date

24

1.2. B) TRADITIONAL PLANS OF BAJAJ ALLIANZ LIFE

INSURANCE
I.

ENDOWMENT PLAN
Saving plan, which offer bonuses, are excellent long term plan with complete safety.
Our products offer additional benefits which include 4 times life cover at a little
extra cost, limited premium payment terms and compounded reversionary bonuses
making it a very good long term investment.
Invest Gain
Save Care Economy SP
Life Time Care
Super Saver

1. Bajaj Allianz Invest Gain

Invest Gain is a specially designed plan that offers a unique combination of benefits that
help you develop a sound financial portfolio for your family.
4 Times Life Cover at a little extra cost.
Limited premium payment option available.
Additional Benefits:
a) Accidental Death Benefit and Disability Benefit.
b) Critical Illness Benefit and Hospital Cash Benefit.
c) Family Income Benefit: In case of death or accidental total permanent disability of
insured, all future premiums are waived and 1% of the sum assured is paid monthly.

25

2. Bajaj Allianz save Care Economy SP

A One-time payment Investment plan that provides for savings with high risk cover for
10 years and also participates in the profits of the company. It offers you high risk cover
with easy liquidity and high returns.
a) A single premium endowment plan that participates in the profits.
b) 10 year Investment plan.
c) Benefits payable on maturity.
c) Loans available.

26

3. Bajaj Allianz life time care

A whole life plan, which provides survival benefits at the age of 80, thereby
making sure you are financially secure at the time when you need it the most.
Additional Benefits:
a) Accidental Death Cover and Disability Cover.
b) Critical Illness Cover and Hospital Cash Cover.
c) Waiver of Premium Benefit.

4.Bajaj Allianz Super Saver plan

Bajaj Allianz Super Saver is a regular premium endowment plan, which helps
you save regular amounts for a safer tomorrow. It also provides you with extra
benefits of Guaranteed Additions to your sum assured, at the end of each
policy year.

27

II.

MONEY BACK PLAN

Money back plans are Traditional Insurance plans that provide the investor with
returns at regular stages of life.
CashGain

1)Bajaj Allianz Cash Gain plan

A Money back plan which guarantees 125% payout + bonuses.
Quadruple life cover.
5 easy payouts which give upto 125% + bonuses.

Additional Benefits:
a) Accidental Death Benefit and Disability Benefit.
b) Critical Illness Benefit and Hospital Cash Benefit.
c) Family Income Benefit: In case of death or accidental total permanent disability
of insured, all future premiums are waived and 1% of the sum assured is paid
monthly.

28

29

CURRENT SCENERIO
2.1) CURRENT SCENERIO OF THE INSURANCE INDUSTRY
With largest number of life insurance policies in force in the world, insurance happens to
be a mega opportunity in India. Its a business growing at the rate of 15-20 per cent
annually and presently is of the order of Rs. 450 billion. Together with banking services,
it adds about 7 per cent to the countrys GDP. Gross premium collection is nearly 2 per
cent of GDP and funds available with LIC for investment are 8 per cent of GDP.
Yet, nearly 80 percent of Indian population is without life insurance cover while health
insurance and non-life insurance continues to be below international standards. And this
part of the population is also subject to weak social security and pension systems with
hardly any old age income security. This it is an indicator that growth potential for the
insurance sector is immense. A well-develop and evolved insurance sector is needed for
economic development as it provides long term funds for infrastructure development and
at the same time strengthens the risk taking ability. It is estimated that over the next ten
years India would require investments of the order of one trillion US dollar. The
insurance sector, to some extent, can enable investment in infrastructure development to
sustain economic growth of the country. Insurance is a federal subject in India. There are
two legislation that govern the sector - The Insurance Act-1938 and The IRDA Act-1999.

30

In India, insurance is generally considered as a tax-saving device instead of its other

implied long term financial benefits. Indian people are prone to investing in properties
and gold followed by bank deposits. They selectively invest in shares also but the
percentage is very small. Even to this day, Life Insurance Corporation of India dominates
India insurance sector. With the entry of private sector players backed by foreign
expertise, Indian insurance market has become more vibrant. Business is becoming
increasingly vulnerable due to wide variety of risk particularly after September 11, 2001
disaster in which twin tower located in the hearts of New York city were crashed by
terrorist attack resulting in loss of 6000 human lives as well as financial loss to the extent
of $45 billion. The impact of this terrorist attack has created new horizon of risk to the
business world today.
However, rapid changes in the global economy, development of technology and ebusiness already gathered momentum. Increased dependency on technology has
originated new risks that have resulted in well-published incidents. Computer hackers
obtaining credit card information from visa and Power-Gen, the love bug virus, cyber
extortion, web content liability, professional errors and omissions, computers and other
crimes and activities such as terrorism, kidnapping and companys executive and
extortion of money, commercial liability etc have significant impact on business resulting
in extreme financial loss, commercial embarrassment or regulatory implications.
Corporation insurance/risk managers, under the circumstances, have to demand
increasingly complex insurance products. They have to be more attentive and
knowledgeable about emerging risks, how those risks are managed effectively and
efficiently, and how they could ultimately affect a companys financial situation and
therefore its position in the market place. In short, how such risks are managed and can
give to an insured a competitive advantage.
In the changing times, adoption of e-commerce into business models, the integration of
web-based communication and data transfer capabilities into the business operations, and
leveraging of advanced network and technology architecture for maximum benefit are the
new horizon of the risks. For the corporate insurance/risks managers, these new
exposure-cyber-risks-can lead to cyber losses, widening the interpretation of what
constitute insure property damage, particularly as it relates to information technology and
data.
All the while, organizations are tremendous pressure to reduce expenses and increase
profit margin, and cannot afford to suffer a property loss of business interruption due to
any cause (risk). How a company identifies, quantifies, qualifies and manages these new
risks exposure, in addition to the well-known tradition risks, is becoming an important
factor in creating shareholders value. This often means changing the way. Everyone in the
organization have to think about risk.
Insurance managers are seeing price levels (premium) continue to rise-albeit modestly-in
todays primarily commercial property and reinsurance markets. They are demanding that

31

insurers improve their risk assessment and quantification offerings so that an insured may
avail the benefit in cost (premium rate) on account of well-managed risk.
The good news for insurance managers is that as the economy evolves, insurers are
increasingly matching that evaluation with new products, services and capabilities due to
opening up the insurance market to the private players.
Insurers who are truly listening to their customers and striving to be more in tune with
their needs are responding to the fast changing corporate insurance and risk management
landscape. They are listening to their customers. They are making fresh approaches to
Reliance Life Insurance Company Limited (RLIC) is amongst the fastest growing life
insurance companies in India. It is also amongst the top four private sector life insurance
companies in India. (As on FY 2008-2009)
As on March 31, 2009, RLIC has an annualized premium of Rs. 30 billion with a market
share of 10.3%. It has leapfrogged on the growth path and has reached the 4 million
policy mark, in a short span of within 3 years. RLIC has a strong distribution network of
1,145 branches with more than 149,000 agents.
address the new challenges faced by insured organization by designing the new products
as per the needs. Insurers are providing value added services to insured to protect the
value created by the business.
Insurers are increasingly required to develop and expand their information technology
platforms to ensure that the vast amount of data they collect about their customers.
Insurance/risk portfolio can easily and seamlessly be transformed into valuable risk
management information. To help their customers, insurers should make better-informed
decisions. They must be able to swiftly deliver this data to their customers (insured)
anywhere in the world. Insurer are also discovering that risk assessment have to be
customized to meet policyholders new exposures and needs. The insurance industry is
stepping up and addressing these challenges in several different ways.

2.2) CURRENT SCENARIO OF RELIANCE LIFE INSURANCE

RLIC offers wide range of innovative life insurance products, targeted at individuals and
groups. It offers need based products that caters to four distinct segments namely
protection, child, retirement and investment plans. RLIC is committed to emerge as a
transnational Life Insurer of global scale and standard.

32

33

Insurances Market Share in Comparison of Other Private company

If we look at the status of Reliance Life Insurances market share in comparison of other
private company in comparison of premium earned:-

If we talk the growth of Insurance industrys private players in recent years, the data will
reflect:-

CH - 3) RESEARCH METHODOLOGY

34

RESEARCH DESIGN:COMPARITIVE STUDY- A comparative study has been undertaken to compare the
traditional Plans of Reliance Life Insurance with that of Bajaj Allianz life insurance.

DATA TYPE
INTRODUCTION: - Any organization whether big or small, private or public needs
different type of information to know its popularity. I have gathered secondary data and
primary data and collected information from the combination of these two data.

PRIMARY DATA: - Primary data collection method was decided for observing
working of the company and approaching the customers directly face to face .A
great care was taken while collecting the primary data to answer that it is relevant,
accurate, current and unbiased.

SECONDARY DATA: - Secondary data collection method was used by referring

to various websites, books and newspapers for collecting information regarding
the project under study. Secondary data consist of the information that already
exists somewhere else for some another purpose.

SAMPLING TECHNIQUES:SAMPLE SIZE- A sample size of 50 was taken to be analyzed.

SAMPLE LOCATION:-Various sectors of Kamla Nagar, Civil lines, Mukherji Nagar,
Model Town and selected areas of Delhi.
SAMPLING PROCESS: - Convenient sampling was used to overcome the time and
money constraints that could have been faced by us while collecting the data. The
customers were contacted face to face directly and also by way of telephonic
conversation with them.
ANALYTICAL TOOLS: - The data collected were arranged accordingly and statistical
tools like bar graphs and pie-charts were used to analyze and present the data.

35

RESEARCH INSTRUMENT USED:SAMPLING MEDIA: - Printed questionnaires consisting several questions were asked
to have an idea of customers view about Reliance Life Insurance plans followed by
personal questions.

FIELD WORK: - Rigorous field work was undertaken to locate the interested and
potential respondents to fulfill the objectives of the study.

36

THE PRIMARY OBJECTIVEOF THE STUDY:The primary objective of the research study is to have a detailed analysis of Reliance Life
Insurance bringing in focus the future prospects of the (Anil Dhirubhai Ambani group)
with relevance to the customer perception regarding the various plans and products
offered by Reliance Life Insurance.

37

3.1) DATA ANALYSIS AND INTERPRETATION

PERSONAL DETAILS
1) AGE:
a) 18-30
b) 31-50
c) 51-65
AGE

NO. OF RESPONDENTS

PERCENTAGE

18-30

21

42%

31-50

19

38%

51-65

10

20%

TOTAL

50

100%

RES
PONNO.
DENOF
TS

AGE WISE CLASSIFICATION

45
40
35
30
25
20
15
10
5
0

42

38
20

18 to 30

31 to 50

51 to 65

AGE (in year)

38

INTERPRETATION:-The bar graph reveals that 42% of the respondents

belong to the age group of 18-30 years, 38% lies in the age group of 31-50
years and 20% of them lie in the age group of 51-65 years.
2) OCCUPATION:

a)
b)
c)
d)
e)

Service
Business
Profession
Housewife
Retired

OPTION

NO. OF RESPONDENTS

PERCENTAGE

Service

16

32%

Business

14

28%

Profession

10%

Housewife

16%

Retired

14%

TOTAL

50

100%

OCCUPATION WISE CLASSIFICATION

35

32
28

30
25
20

16
14

15
10

10
5
0
Service

Business Profession Housewife

Retired

OCCUPATION

INTERPRETATION:-The above bar graph reveals that 32% of the total

respondents were servicemen, 28% of them belonged to the business class, 10%

39

were professionals, 16% were housewives and 14% of the total respondents fall in
the retired category.
3) INCOME:
a) 150000-300000
b) 300000-500000
c) Above 500000

OPTION

NO. OF RESPONDENTS

PERCENTAGE

150000-300000

24

48%

300000-500000

14

28%

Above 500000

12

24%

TOTAL

50

100%

RE
SP N
ON O.
DE OF
NT
S

INCOME WISE CLASSIFICATION

50
40
30
20
10
0

48
28

24

150000- 300000- ABOVE

300000 500000 500000
INCOME (in RS.)

INTERPRETATION:-The above bar graph reveals that out of the total respondents
48% lie in the income group of 150000-300000, 28% of the total respondents

40

belonged to the income group of 300000-500000 and 24% lie in the income group of
people earning an income of above Rs. 500000p.a.

4) FAMILY MEMBERS

a)
b)
c)
d)

2
3
4
Above 4
OPTION
2
3

NO. OF RESPONDENT
11
9

PERCENTAGE
22%
18%

4
Above 4

24
6

48%
12%

TOTAL

50

100%

No.
of
resp
ond
ents

MEMBER WISE CLASSIFICATION

50
40
30
20
10
0

48
22

18

12
4

Above 4

No. of family members

INTERPRETATION: The above bar graph shows that 22% of the total respondents had
a family of 2 members, 18% of them had 3 family members, 48% of them had 4 family
members, and 12% of them had the no. of family members above 4.

41

Q1. Where do you prefer to invest?

a) fixed deposits
b) stock
c) mutual funds
d) insurance
e) others
Option

No. of respondents

Percentage

Fixed deposits

10%

Stock

10

20%

Mutual fund

10

20%

Insurance

18

36%

others

14%

TOTAL

50

100%

42

Interpretation: The above pie chart shows that out of 50 respondents, 10% preferred to
invest in fixed deposits, 20% in stocks, 20% in mutual funds, 36% in insurance and 14%
in others like property, gold, etc.

Q2. What are your priorities for investment?

a) protecting your family against pre-mature death
b) wealth creation
c) retirement needs
d) child education and marriage
e) protect income against disability, sickness or critical illness
Option

No. of respondents

Percentage

Protecting your family against pre

mature death

10

20%

Wealth creation

14

28%

Retirement needs

10%

Child education and marriage

14%

Protect income against disability,

sickness or critical illness

14

28%

TOTAL

50

100%

43

Interpretation: The above pie chart shows that out of 50 respondents, 20% of them
invest for protecting their family against premature death, 28% for creating wealth, 10%
for meeting their future retirement needs, 14% for child education & marriage and 28%
for protection against disability and sickness.
Q3. What is your main motive behind investing in life insurance?
a) tax benefit
b) savings
c) risk cover
Option

No. of respondents

Percentage

Tax benefits

27

54%

Savings

10%

Risk cover

18

36%

TOTAL

50

100%

Interpretation: The above pie chart shows that out of the sample respondents, 54% have
tax benefit 10% have savings and 36% have risk cover as their main motive for making
an investment in life.

44

Q4. What kind of investment do you prefer?

a) high risk high gain
b) low risk low gain
c) moderate
d) vary times to times
Option

No. of respondents

Percentage

High risk high gain

16%

Low risk low gain

10%

Moderate

12

24%

Vary times to times

25

50%

TOTAL

50

100%

Interpretation: The above pie chart shows that out of 50 respondents, 16% preferred
high risk- high gain form of investment 10% preferred low risk- low gain form of
investment, 24% preferred moderate investment and 50% preferred varied form of
investment.

45

Q5.Are you interested to invest in Traditional Plans?

a) YES
b) NO
Option

No. of respondents

Percentage

YES

36

72%

NO

14

28%

TOTAL

50

100%

Interpretation: The above pie chart shows that 72% of the respondents preferred to
invest in Traditional Plans.

46

Q6. What is your level of annual investment?

a) below 20000
b) 20000-40000
c) above 40000
Option

No. of respondents

Percentage

Below 20000

41

82%

20000-40000

14%

Above 40000

4%

TOTAL

50

100%

Interpretation: The above pie chart shows that 82% of the respondents, are willing to
invest below Rs 20,000 per annum, 14% of them want to invest within Rs 20,000 per
annum to Rs 40,000 and 4% wanted to invest over and above Rs 40,000.

47

Q7. What factors would you consider most important before choosing an insurance
policy?
a) publicity of the company
b) reputation of the company
c) quality of life advisors
d) after sales-supporting of the company
Option

No. of respondents

Percentage

Publicity of the co.

20%

Reputation of the co.

25

50%

Quality of life advisors

10

10%

After sale-services

10

20%

TOTAL

50

100%

Interpretation: out of the sample respondents, 20% considers publicity of the company,
50% considers reputation of the company, 10% considers quality of life advisors, and
20% considers after sales support of the company as the most important factor for
choosing an insurance company.

48

Q8. Which life insurance company would you prefer the most to invest in?
a) reliance life insurance (RLIC)
b) Bajaj Allianz life insurance
Option

No. of respondents

Percentage

RLIC

21

42%

BAJAJ ALLIANZ

29

58%

TOTAL

50

100%

Interpretation: Out of 50 respondents, 42% preferred to invest in reliance life insurance

over 58% of the respondents who prefer to invest in Bajaj Allianz life insurance.

49

Q9. If reliance life insurance, then which particular plan you would like to invest in?
a) Reliance Term Plan
b) Reliance Whole Life Plan
c) Reliance Endowment Plan
d) Reliance Special Endowment Plan
Option

No. of respondents

Percentage

Reliance term plan

28.58%

Reliance whole life plan

14.28%

Reliance endowment plan

42.86%

Reliance special endowment plan

14.28%

TOTAL

21

100%

Interpretation: Out of 21 respondents, 28.58% preferred to invest in term plan, 14.28%

in whole life plan, 42.86% in endowment plan and 14.28% of them preferred to invest in
special endowment plan of reliance life insurance.

50

Q10. If Bajaj Allianz life insurance, then which particular plan you would like to
invest in?
I.

ENDOWMENT PLAN
a) Bajaj Allianz Invest Gain
b) Bajaj Allianz save Care Economy SP
c) Bajaj Allianz life time care
d) Bajaj Allianz Super Saver plan

II.

MONEY BACK PLAN

i.
Bajaj Allianz Cash Gain plan
Option

No. of respondents

Percentage

Invest gain plan

10.35%

Save care economy SP

Life time care
Super saver plan
Cash gain plan

6
7
3
10

20.69%
24.15%
10.35%
34.46%

TOTAL

29

100%

Interpretation: Out of 29 respondents, 10.35% of them plan to invest in Bajaj Allianz- Invest
Gain, 20.69% wish to invest in Bajaj Allianz save Care Economy SP, 24.15% want to invest in
Bajaj Allianz life time care, 10.35% in Bajaj Allianz Super Saver plan and 34.46% prefer to
invest in Bajaj Allianz Cash Gain plan.

51

3.2) SIGNIFICANCE OF STUDY

Life insurance is one of the most rapidly growing sectors in India. The main reason
behind the growth can attributed to the high population density, improving economical
condition, improving education level and improving awareness. Due to these factors there
is still huge scope for growth in this sector. Like any other business when the
opportunities are present everybody tends to enter the industries. This growth hence,
fetches the new competitors as well as new strategies from existing players. To sustain in
any competitive industry, the organization must adapt to existing strategies and adopt new
ones. This study will focus on the analysis of Reliance Life Insurance in comparison with
the present scenario of Bajaj Allianz Life Insurance with respect to the Traditional Plans
of both the companys. This will mainly cover the following aspects:
To know about the awareness and popularity of various Traditional Plans offered
by Reliance Life Insurance and Bajaj Allianz Life Insurance.
How Reliance Life Insurance can develop and sustain a good distribution
network.
These will provide it benefit both in terms of better market coverage as well as better
penetration.

52

3.3) SCOPE OF THE STUDY

1.) This helps in finding out vast potential of insurance company.
2.) The study was conducted in National Capital Region (NCR) only.
3.) The number of respondents to be surveyed can be improved.
4.) This study was conducted by comparing the performances & products of three private
& government insurance players in insurance industry.
5.) This study was conducted to analyze the market stand of Reliance life insurance
Company limited and Bajaj Allianz Life Insurance Company Limited of India insurance
companies.
6.) This study is done to eliminate all the myths which people have in their minds
regarding Insurance Sector.

53

3.4) OBJECTIVES
To have a detailed understanding of Reliance Life Insurance and Bajaj Allianz
Life Insurance.
To find out various reasons considered while investing in policies.
To get knowledge about the market exposure and future prospects about Reliance
Life Insurance.
To know the perception of the consumers about the life insurance.
To analyze the Traditional plans of Reliance Life Insurance and compare it with
Bajaj Allianz.
To know about the brand awareness of Reliance Life Insurance, its customer
preferences over Bajaj Allianz in the market.
To study a proper knowledge about the life insurance industry.
To understand the consumer choice while investing in policies.

54

CHAPTER 4
DISCUSSION AND FINDINGS
OF THE STUDY

FINDINGS OF THE STUDY

RECOMMENDATION AND SUGGESTIONS
CONCLUSION
LIMITATIONS
BIBLIOGRAPHY
ANNEXURE:QUESTIONNAIRE

55

4.1) FINDINGS OF THE STUDY

1.) The survey reveals that still a large proportion of population is interested to invest in
other forms of investment other than insurance as still most of them are unaware about
the importance of insurance in their life.
2.) Basically people make varied form of investment for creating wealth, to protect their
families against pre-mature death and to protect income against disability, sickness or
critical illness.
3.) The main motive of the individuals investing is receives benefits U/S 10/10D. People
generally consider insurance as a tax saving device.
4.) Mostly people prefer time to time form of investment as they are not willing to take
high degree of risk.
5.) 72% of the respondents are preferred to invest in Traditional Plans.
6.) Most of the people prefer to make an annual investment up to a maximum of Rs.20,
000 per annum.
7.) When the product is like life insurance, reputation of the company, publicity of the
company & after sale services of the company matters a lot. This means that people
would choose that insurance company only, where the quality of life advisors is
satisfactory.
8.) Most people prefer to invest in Bajaj Allianz Life Insurance as compared to making an
investment in Reliance Life Insurance.
9.) The most preferable Traditional plan of Reliance Life Insurance is Endowment Plan.
10.) The most preferable plan of Bajaj Allianz Life Insurance co. is Cash Gain Plan.

56

4.2) SUGGESTIONS & RECOMMENDATIONS

Based on the observations of the study some suggestions for the organization are made as
follows:
1.) Quality of advisors is also as important as the quantity. Thus company should go
mainly for qualified professionals.
2.) Company should increase its budget on publicity so that awareness can be increased.
3.) Clarity and transparency should be provided to the customer regarding various
products.
4.) Training sessions should be planned in advance so that schedule can be provided to
the advisor in advance.
5.) Apart from the Brand Positioning in urban area, a strategy should be adopted by
Reliance to make its brand also near to middle level, or high aspirant people because they
are the main source of the business in India
6.) Awareness Camp to the sub urban area should be focused by Reliance.
7.) Some innovative technique or product is required in order to attract the consumer.

57

4.3) LITERATURE REVIEW

1.) Robi Elenekave has explained in detail why various retirement plans and pension
plans dont give the desired returns. The main difficulty is the use of incorrect method for
calculations done to find out the return on investment. This is primarily due to wrong
assumptions. The study provides information about the various precautions which need to
be considered before planning so that the desired results can be achieved.
2.) Another paper provides insight about how various financial sectors invest in bond
market. The study was how the different players investment different instruments
according to the risk appetite and desired rate of return. The study shows that life
insurance sector mainly invests in government bond which are low return and low risk
instrument. The investment in government bond it shows that life insurance companies
are more conservative in investment.
3.) K. Subhash has presented the history of Indias life insurance industry in three stages
before independence, after independence and post liberalization which not only provides
information but also help in analyzing the impact of these major changes. The authors
have also discussed the huge potential which exists in the rural India. The insurance
company must realize the importance of rural sector because the future lies there. The
author commented about the increasing share of private player in the existing market.
This confirms the availability of opportunity in this sector. The paper also provides the
importance of professional and focused approach which was given no importance.
4.) Tapen Sinha has discussed the various challenges and opportunities in the insurance
market. One of the very important factors which have been discussed in the study is the
importance of developing new and better products. As the scenario changes the need of
an individual also changes so any organization must understand and fulfill these needs.
The new product development requires constant research so organization must also focus
on it.
5.) Roger G. Ibbotson discusses how financial planners and advisors have recently started
to recognize that human capital must be taken into account when building optimal
portfolios for individual investors. Any investors human capital has a unique mortality
risk. However, life insurance in its forms can hedge against this mortality risk. Thus,
human capital affects both the optimal asset allocation and the optimal demand for life
insurance. This paper provides a unified framework based on human capital in order to
enable individual investors to make both decisions jointly.
6.) Rakesh Niraj study tells how the flow of information in any organization is important.
For any organization to grow, the flow of information must be good both upwards as well
as ownwards. The proper flow of information will also ensure proper flow of good and

58

services from organization to customer and proper flow of information from customer to
organization. The information from customers will help the organization in providing
better goods and services to the customer. For the above purpose, organization must
ensure good channel partner who can provide the organization with correct feedback.
Hence it becomes very important for any organization to acquire good channel partners.
7.) Stephen P. Robbins has discussed how group dynamics works in any organization.
The success of any organization depends on the success of its various teams and how
these teams work together. The book provides various techniques which can be used by
any organization to get result from the team effort. The conflict resolution is a major task
in any group. Various techniques which the organization can use in conflict resolution are
also discussed. Another important aspect covered is the importance of leadership in the
organization. The various forms of leadership have been discussed and the kinds of
leadership which can be effective in particular situations are also discussed.
8.) R. Wayne Mondy has discussed the importance of training and development in any
organization. The training provides skills to perform the current job where as the
development involve learning beyond present need. The various type of training are
discussed which can be used according to the requirement. Training and development are
not only important for better performance of an individual but it also gives satisfaction.
The major factors which influence training and development are found to be management
support, commitment of trainee and trainer, complexity of the organization. The process
of developing good training plans is also provided. In another part author has discussed
the importance of right man for right job. The compensation strategies are also given
which are very crucial for ant industry.
9.) Philip Kotler has discussed the importance of channels partners. Better the channel
partners better will be the delivery model. Detailed discussion about how to design the
channel structure so that all the requirements could be fulfilled is provided. The various
issues faced by the organization while managing the channels are also given. When an
organization has more than one channel it becomes very important that all the channels
should be integrated in such a way that the organization get the best out of all. At times
due to the conflicting benefit of the different channels the conflict arise so various
strategies to manage these issues is also discussed in the chapter.
10.) Michael J. Etzel has written about the marketing of services. The marketing of
services is different from the goods because of the characteristic of service like
intangibility, inseparability, heterogeneity etc. Brief about pricing strategies is also given
in case of services. The authors have also given the impact of technological development
on the services marketing. The author has also given the importance of brand and after
sales support in case of services as perception of the customers plays an important role. In
other part of the book the authors has described the importance of distribution channels

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and designing of the same. A channel partner should be consider as partner according to
discussion. The legal complications associated with channels are also discussed. These
complications are necessary to take into the consideration while managing the channels.
The conflicting interest of channels both horizontally and vertically are also taken into
the consideration.
11.) Boone has discussed about the importance of personal financial planning. The
concept of time value of money has also been elaborated. The importance of creating and
implementing budget is given under money management. The other important concepts
for financial planning like credit management and understanding taxes are also explained.
In one section the authors have discussed the importance of investment and what should
be the major considerations while making any investment. The considerations include the
risk associated with the investment, return on the investment etc. The importance and
benefits of life insurance has also been given. The discussion also includes various legal
aspects associated with life insurance. The overview of retirement planning is also given
which includes importance and benefit of retirement planning. Various tools for proper
retirement planning are also discussed.

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4.4) CONCLUSION
1.) The customers are very much sensitive towards their investment. They would like to
invest only in that insurance company which enjoys good public image along with quality
good services
2.) The result of the survey conducted shows that Bajaj Allianz Life Insurance is the
leader in life insurance industry but Reliance Life Insurance and other private players are
giving it a close competition.
3.) The motive of the people behind investing in life insurance is the tax benefits that they
would receive under sec 80C and 10/10D.
4.) In Life Insurance industry, the after sales support of the company is as important as
the quality of life advisors.

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4.5) LIMITATIONS
There were some limitations faced during the study as discussed below:
Since the study was taken for two months, so there was a constraint of time and
effort.
The study was limited only to some of the Delhi regions so the results may be
biased.
Questionnaire was given to 125 people however only 50 responded to it, which is
very small for such type of study.
The biasness of consumer or responses error cannot be eliminated.
Most of the people are not aware about the Importance and the necessity of
insurance in their life.
Adverse perception of the people towards insurance sector- People consider
insurance as a tax saving device.
Lack of awareness about the earning opportunity in the insurance sector.

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4.6) BIBLIOGRAPHY

www.reliancelifeinsurance.com
www.adagroup.com
www.irda.com
www.bajajallianzlifeinsurance.com
www.allianzbajaj.com

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