CHAPTER-1: INTRODUCTION

1.1 About The Industry

Insurance may be described as a social device to reduce or eliminate risk of life and property. Under the plan of insurance, a large number of people associate themselves by sharing risk, attached to individual. The risk, which can be insured against include fire, the peril of sea, death, incident & burglary. Any risk contingent upon these may be insured against at a premium commensurate with the risk involved. Insurance is actually a contract between 2 parties whereby one party called insurer undertakes in exchange for a fixed sum called premium to pay the other party happening of a certain event. Insurance is a contract whereby, in return for the payment of premium by the insured, the insurers pay the financial losses suffered by the insured as a result of the occurrence of unforeseen events. With the help of Insurance, large number of people exposed to a similar risk makes contributions to a common fund out of which the losses suffered by the unfortunate few, due to accidental events, are made good.

History of Insurance industry

In some sense we can say that insurance appeared simultaneously with appearance of human society. In earlier economies, we can see insurance in the form of people helping each other. For example, if a house is burnt, the members of the community help build a new one. Should the same thing happen to ones neighbour, the other neighbours must come to help? Otherwise, neighbours will not receive help in the future. Insurance in the modern sense, started as a methods of transferring or distributing risk were practiced by Chinese and Babylonian traders as long ago as the 3rd and 2nd millennia BC, respectively. Chinese merchants travelling treacherous river rapids would redistribute their cargo across many vessels to limit the loss due to any single vessels capsizing. The Babylonians developed a system which was recorded in the famous Code of Hammurabi, c. 1750 BC, and 2

practiced by early Mediterranean sailing merchants. If a merchant received a loan to fund his shipment, he would pay the lender an additional sum in exchange for the lenders guarantee to cancel the loan should the shipment be stolen. Greek monarchs were the first to insure their people and made it official by registering the insuring process in governmental notary offices. They invented the concept of the general average. Merchants whose goods were being shipped together would pay a proportionally divided premium which would be used to reimburse any merchant whose goods were jettisoned during storm or sinking of the vessel in the sea. The Greeks and Romans introduced the origins of health and life insurance c. 600 AD when they organized guilds called benevolent societies which cared for the families and paid funeral expenses of members upon death. Guilds in the middle Ages served a similar purpose. Before insurance was established in the late 17th century, friendly societies existed in England, in which people donated amounts of money to a general sum that could be used for emergencies. The first insurance company in the United States underwrote fire insurance and was formed in Charles Town (modern-day Charleston), South Carolina, in 1732.

Insurance In India
The insurance sector in India has come a full circle from being an open competitive market to nationalization and back to a liberalized market again. Tracing the developments in the Indian insurance sector reveals the 360-degree turn witnessed over a period of almost 190 years. The business of life insurance in India in its existing form started in India in the year 1818 with the establishment of the Oriental Life Insurance Company in Calcutta.

Some of the important milestones in the life insurance business in India are:
1912 - The Indian Life Assurance Companies Act enacted as the first statute to regulate the life insurance business.

1928 - The Indian Insurance Companies Act enacted to enable the government to collect statistical information about both life and non-life insurance businesses. 1938 - Earlier legislation consolidated and amended to by the Insurance Act with the objective of protecting the interests of the insuring public. 1956 - 245 Indian and foreign insurers and provident societies taken over by the central government and nationalized. LIC formed by an Act of Parliament, viz. LIC Act, 1956, with a capital contribution of Rs. 5 crore from the Government of India. The General insurance business in India, on the other hand, can trace its roots to the Triton Insurance Company Ltd., the first general insurance company established in the year 1850 in Calcutta by the British.

Functions
The functions of Insurance can be bifurcated into two parts:
1. Primary Functions

2. Secondary Functions 3. Other Functions

The primary functions of insurance include the following: Provide Protection - The primary function of insurance is to provide protection against
future risk, accidents and uncertainty. Insurance cannot check the happening of the risk, but can certainly provide for the losses of risk. Insurance is actually a protection against economic loss, by sharing the risk with others.

Collective bearing of risk - Insurance is a device to share the financial loss of few among
many others. Insurance is a mean by which few losses are shared among larger number of people. All the insured contribute the premiums towards a fund and out of which the persons exposed to a particular risk is paid.

Assessment of risk - Insurance determines the probable volume of risk by evaluating various
factors that give rise to risk. Risk is the basis for determining the premium rate also.

Provide Certainty - Insurance is a device, which helps to change from uncertainty to

certainty. Insurance is device whereby the uncertain risks may be made more certain. 4

The secondary functions of insurance include the following: Prevention of Losses - Insurance cautions individuals and businessmen to adopt suitable
device to prevent unfortunate consequences of risk by observing safety instructions; installation of automatic sparkler or alarm systems etc. Prevention of losses causes lesser payment to the assured by the insurer and this will encourage for more savings by way of premium. Reduced rate of premiums stimulate for more business and better protection to the insured.

Small capital to cover larger risks - Insurance relieves the businessmen from security
investments, by paying small amount of premium against larger risks and uncertainty.

Contributes towards the development of larger industries - Insurance provides

development opportunity to those larger industries having more risks in their setting up. Even the financial institutions may be prepared to give credit to sick industrial units which have insured their assets including plant and machinery.

The other functions of insurance include the following: Means of savings and investment - Insurance serves as savings and investment, insurance
is a compulsory way of savings and it restricts the unnecessary expenses by the insured's For the purpose of availing income-tax exemptions also, people invest in insurance.

Source of earning foreign exchange - Insurance is an international business. The country

can earn foreign exchange by way of issue of marine insurance policies and various other ways.

Risk Free trade - Insurance promotes exports insurance, which makes the foreign trade risk
free with the help of different types of policies under marine insurance cover.

Classification of Insurance
Life is full of uncertainty. Trials and tribulations abound in each and every aspect of life. No one can truly predict or even estimate what the future has in store for him. Life offers no guarantees by itself, except the incidences of death and taxation.

This lack of security present throughout life can be overcome partially through insurance. Insurance can never replace or repair a loss. But the monetary value offered by insurance helps in adjusting to the new circumstances. Despite offering innumerable options and immense scope, insurance can be classified into four main categories. Insurance of Person Insurance of Property Insurance of Interest Insurance of Liability

Insurance of Person:
Under the purview of this class of insurance, the risks associated with human life in general can be covered up to the limit specified. A person can insure his or her life and his health against any unplanned contingencies. In event of his death, his dependants will be reimbursed to the full amount that he was insured for. Or if the insured person meets with an accident or suffers from an illness that cripples him forever, he will be compensated with the complete sum assured anyway since he may not be able to lead a normal life again. In case, the accident is not that severe, he should be able to recover after medical treatment and rehabilitation. If he has opted for medical cover, then his medical expenses, treatment and medication will be paid for by his insurance policy.

Insurance of Property:
Everyone possesses material value in the form of tangible assets. Assets can be in the form of a landed estate or a vehicle, share holdings or plain old paper money. Since tangible property has a physical shape and consistency, it is subject to many risks ranging from fire, allied perils to theft and robbery. An individual's lifetime of hard work can be wiped out in a blink of an eye. But if a person judiciously invests in insurance for his property prior to any unexpected contingency then he will be suitably compensated for his loss as soon as the extent of damage is ascertained. 6

Insurance of Interest:
Every individual has to discharge certain specific duties. Everyone is expected to maintain a standard of conduct. But then, it is an intrinsic part of human nature to err. No one is infallible and no one will ever be. Owing to an occasional error or omission committed by us, our clients or customers might suffer a loss. In turn we might have to pay those damages or compensation out of our own personal resources. However, if our chosen profession qualifies for insurance of interest, then our insurance policy will more than suffice in arranging for the funds and court formalities that might ensue in the aftermath of legal libel.

Insurance of Liability:
Every person has to regulate his actions and behaviour so as not to cause injury or damage to other people and their property. Everyone is personally responsible and liable for his actions. If due to lack of control over his actions or prejudiced behaviour, a person incurs any liability then he has to provide compensation out of his personal resources. Liabilities: legal, civil or criminal can have severe repercussions on social standing and prestige besides the financial status. By investing in liability insurance, an individual can ward off any liabilities he might incur due to his actions and behaviour. Besides, the premiums payable on liability insurance are fairly minimal when compared to the damages that have to be compensated in the long run.

List of Private sector Insurers Granted Permission by IRDA

1. Bajaj Allianz Life Insurance Company Limited 2. Birla Sun Life Insurance Co. Ltd 3. HDFC Standard Life Insurance Co. Ltd 4. ICICI Prudential Life Insurance Co. Ltd. 5. ING Vysya Life Insurance Company Ltd. 7

6. Life Insurance Corporation of India 7. Max New York Life Insurance Co. Ltd 8. Met Life India Insurance Company Ltd. 9. Kotak Mahindra Old Mutual Life Insurance Limited 10. SBI Life Insurance Co. Ltd 11. Tata AIG Life Insurance Company Limited 12. Reliance Life Insurance Company Limited. 13. Aviva Life Insurance Co. India Pvt. Ltd. 14. Sahara India Life Insurance Co. Ltd. 15. Shriram Life Insurance Co. Ltd. 16. Bharti AXA Life Insurance Company Ltd. 17. Future Generali Life Insurance Company Ltd. 18. IDBI Fortis Life Insurance Company Ltd. 19. Canara HSBC Oriental Bank of Commerce Life Insurance Co. Ltd 20. AEGON Religare Life Insurance Company Limited. 21. DLF Pramerica Life Insurance Co. Ltd. 22. Star Union Dai-ichi Life Insurance Comp. Ltd.

1.2 Company Profile AEGON Religare

AEGON Religare Life Insurance Company Ltd is a joint venture of AEGON, Religare and Bennett, Coleman & Company. AEGON in one of the world's leading life insurance and pension groups. Religare is a prominent player in the field of integrated financial services in India. On the other hand, Bennett- Coleman & Company is Indias largest media house. The insurance company began its operation in July 2008. Within a short span of time, it has spread across India, by opening over 30 branches in the country. AEGON Religare Life Insurance offers multitude of benefits to its customers. It offers policy servicing on the phone via Interactive Voice Response System (IVR). This is done by issuing the 8

customer a T-Pin for authentication. It boasts of being the first insurance company in India to include the customers medical report in the policy kit. Talking about the individual stake holders, AEGON serves over 40 million customers in as many as 20 markets spread throughout the Americas, Asia and Europe. Headquartered in The Hague, the Netherlands, AEGON carries out major operations in the United States, the Netherlands and the United Kingdom. Religare Enterprises Limited (REL) is a significant player in the field of Retail, Institutional and Wealth spectrums. It has a diverse and wide base of clientele. REL holds 44% equity in AEGON Religare Life Insurance Company Ltd. Talking about Bennett, Coleman & Co. Ltd. (BCCL) it is a mammoth in the field of media, since it is associated with the Times Group, India's largest media house. The Joint Venture of the three giants (of their respective fields) has given rise to AEGON Religare Life Insurance.

About Promoters
AEGON
160 years of experience in the insurance business Ranked 5th largest insurance company in the world on revenues* Present in 20 countries throughout the America, Europe & Asia Track record of finding beneficiaries of policies and settling claims Even in the wake of crisis in the financial world, rated AA# by rating agencies AEGON is an international business, providing life insurance, pensions and other long-term savings and investment products to millions of customers around the world. The company has major operations in the United States, the Netherlands and the United Kingdom as well as other businesses in Asia, the Americas and elsewhere in Europe. AEGON is listed on the stock exchanges of Amsterdam, London, New York and Tokyo. With just over EURO 330 billion in revenue-generating investments at the end of 2008, AEGON companies employ just over 31,000 people worldwide, serving more than 40 million policyholders in over twenty countries across the globe. It holds 26% equity in AEGON Religare.

RELIGARE
A diversified financial services group with a pan-India presence and presence in multiple international locations, Religare Enterprises Limited ("REL") offers a comprehensive suite of customer-focused financial products and services targeted at retail investors, high net worth individuals and corporate and institutional clients. REL, along with its joint venture partners, offers a range of products and services in India, including asset management, life insurance, wealth management, equity and commodity broking, investment banking, lending services, private equity and venture capital. Religare has also ventured into the alternative investments sphere through its holistic arts initiative and film fund. Has launched India's first wealth management joint venture under the brand name 'Religare Macquarie Private Wealth'. REL, through its subsidiaries, has launched India's first holistic arts initiative - with a gallery - as well as the first SEBI approved film fund, which is an initiative towards innovation and spotting new opportunities for creation and maximization of wealth for investors. REL operates from seven domestic regional offices, 43 sub-regional offices, and has a presence in 498* cities and towns controlling 1,837* business locations all over India. To make a mark in the global arena, REL acquired UK-based Hichens, Harrison & Co. in 2008 which was subsequently re-named as Religare Hichens Harrison PLC ("RHH"). Hichens, Harrison & Co. was incorporated in London in the year 1803 and is believed to be one of the oldest firms of stockbrokers in the City of London. Pursuant to expansion of REL's business, the company has grown from largely an equity trading company into a diversified financial services company. With the addition of RHH the REL group now operates out of multiple global locations, other than India, (the UK, the USA, Brazil, South Africa, Dubai and Singapore). It holds 44% equity in AEGON Religare.

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Bennett, Coleman & Co. Limited

Bennett, Coleman & Co. Limited, is the flagship company of The Times Group, which has a heritage of over 150 years and is one of India's leading media groups.

It reaches out to 2468 cities and towns all over India. The group owns and manages powerful media brands like The Times of India, The Economic Times, Maharashtra Times, Navbharat Times, Femina, Filmfare, Grazia, Top Gear, Radio Mirchi, Zoom, Times Now, Times Music, Times OOH, Private Treaties and indiatimes.com

All of its brands are multinational in outlook, traditional at heart and national in spirit. From the very first edition on November 3, 1838 the mammoth BCCL Group has come a long way. By way of the innovative venture of Times Private Treaties, the BCCL Group holds 30% equity in our company.

AEGON Religare Values & Vision

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Product, Pricing & Market Strategies AEGON Religare

5.5(a) Products Life Insurance Plans & Policies
AEGON Religare Life Insurance offers insurance and pension plans specifically designed to help you plan your life better. Select a plan based on your need protection, saving, child or retirement.

Protection Plans

Protection plans are Term Plans which provide only life cover. These plans can help you get adequately covered and secure your family financially in case of unfortunate event. These are low cost life insurance plans Aegon Religare level term plan Aegon Religare Increasing term plan 12

Aegon Religare Decreasing term plan Aegon Religare Group term plan Aegon Religare Rural term plan Aegon Religare Group credit life plan Aegon Religare I-term plan

ULIPs
Unit Linked Insurance Plans or ULIPs as they are commonly called are a form of Savings Plans that help you save and grow your money. ULIPs are a category of goal-based financial solutions that combine the safety of life insurance protection with wealth creation opportunities. Aegon Religare Protect Gain Plan Aegon Religare Premium Gain Plan Aegon Religare Premium Gain Plus Plan Aegon Religare Wealth Protect Plan Aegon Religare Invest Maximiser Plan

Child Plans

AEGON Religare Child Plans are life insurance plans that can help you save for your childs future goals. This plan comes with a Waiver of premium feature, which guarantees to waive all future premiums in event of your demise, and ensures that your child receives full sum assured immediately and 100% of fund value on maturity of policy. Aegon Religare Star Child Plan

Retirement Plans

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The rising inflation has put the fear of the unseen in every working persons life. Today, more than ever, it is vital that you save for the golden years post retirement so that you can maintain your lifestyle as today. Aegon Religare Pension Plan Aegon Religare Insta Pension Plan

Pricing
This company looks to be trying to explore this little explored Life Insurance type. AEGON Religare is providing cheapest Term Insurance for most of the age group. This also shows the companys focus on Term Insurance plans. It would finally benefit the end consumers, who are till now subject to miss-selling by insurance agents, always used to buy ULIPs Endowment policies, which pays more commissions to Insurance Agents, whereas the consumer gets very little amount of Insurance due to high premium in those policies. The only issue with this company could be that it has no track record of previous customer service, which will be known only after a year or so.

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CHAPTER 2: TOPIC INTRODUCTION & LITERATURE REVIEW

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2. 1 About The Topic

The project aims at comparative analysis of child plan insurance of AEGON Religare with that of its competitors. Analyse insurance as an investment option/avenue. The project has also a detailed study of comparison of child insurance plans offered by the major competitors in the insurance sector. It also aims at comparative analysis of the AEGON Religare life insurance plans with that of other major players. The project aims to help in understanding the consumer behaviour towards various financial services like insurance and mutual funds. The report enhances the knowledge on how various marketing concepts learned in the classroom are implemented in a real life environment. The project entitled me to recommend Life Advisor (LA) who will be a channel for bringing business to the AEGON Religare Life Insurance Company. I was given to choose prospective clients who were inclined for a career in insurance sector. The prospective candidate after dully scrutinised by, on fulfilling the entire criterion will be made Life Advisor with AEGON Religare, priority circle Delhi. This project also involves Brand image analysis of AEGON Religare Life Insurance and come up with few recommendations for improvement. The project required me design a questionnaire and to do a primary survey on investor perception towards child insurance & mutual Funds available in the market. The target respondents of the primary survey were managers, executives and consultant working in various sectors through exhibitions and business meets. The data gathered from the primary survey was for analysis and to find various factors that affect an investor decisions while choosing an child insurance or Mutual Fund plan in the market.

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2.2 Literature Review

A review of literature is a summary, analysis and interpretation of the theoretical, conceptual and research literature related to a topic or theme. It is broader than a review of the research which reviews research literature only, and it generally provides the framework for and bridge between a piece of original research and the work which preceded it. A summary of the Writing of recognized authorities and previous research work provides evidence that the researcher is aware of what has been done in the present era of research and what is undiscovered, untested or re-tested. The review of related studies is the basis of most of the research projects in the physical sciences, natural sciences, social sciences and humanities. It enables the researcher to know the means of getting to the frontiers of knowledge related to his/her problem. Effective research being based upon past knowledge helps to eliminate the duplication of what has already been done and provides useful hypothesis and helpful suggestions for significant agreement and those that are seen to present conflicting conclusions, help to sharpen and define the understanding of existing knowledge in the problem area. The review of the related field of research sharpens ones understanding of the existing knowledge and provides a background and a status of the issues relating to the research problems.

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DIFFERENT SOURCES OF INFORMATION FOR REVIEW OF LITERATURE

The act of collecting the literature involves browsing, skimming, reading and photocopying relevant works. Two types of literature need to be distinguished: the conceptual literature indicates the variables and areas in which research to be pursued. Good research generally has a theoretical or conceptual basis, so we need to be familiar with these aspects of the discipline if we are to assess other research studies and design our own. As a researcher we can make use of : (i) reference material; (ii) research periodicals; (iii) abstracts; (iv) theses and dissertations; (v) newspapers and pamphlets; (vi) government documents; (vii) monographs; (viii) computer generated materials for the identification, selection and utilization of related literature.

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CHAPTER 3: RESEARCH METHODOLOGY

3.1 Purpose of the study

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A big boom has been witnessed in Insurance Industry in recent time. A large number of new players have entered the market and are varying to gain market share in this rapidly improving market.

The study deals with AEGON Religare Life in the focus and the various segments that it caters to. The study then goes on to evaluate and analyse the comparison of child insurance in order to give better picture which makes us understand the insurance plans better. It also analyse the findings so as to present a clear picture of trends in the insurance sector.

3.2 Research Objectives of the study

To map the marketing & distribution strategy of AEGON Religare Life insurance Company limited and to compare various strategies used by various players in Life insurance sector. To do detailed analysis of the entire range of life insurance products/schemes offered by AEGON Religare life insurance company Ltd. It will help in making a detailed analysis of the spectrum of life insurance products available in the market across the industry.

To collect data through primary survey, using a comprehensively designed questionnaire and analysing the same for mapping the brand image of AEGON Religare Life insurance company and investor perception about the child plan and mutual funds available in the market, and to identify the major factor that influence investor for choosing an life insurance plan.

To come up with an innovative market and branding strategies for life insurance products. Create a value chain between the customers and the company through network building. Try and sketch out a rough customer to customer approach for AEGON Religare.

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To know the hicks and kicks of marketing financial (life insurance) products in such a hostile and ever changing volatile market.

3.3 Research Methodology of the study

Study the concept of insurance, industry and its regulations from books, Internet and literature survey. This will give us in-depth knowledge about the insurance sector as a whole. To perform Porters 5 forces model of insurance sector to come up with the ideal marketing strategies to be followed for increasing the market share of the company. Data collection regarding the market share, products & services offered by different life insurance company through internet. This will help in identifying the Unique Selling Proposition (USP) of different players in the market. Collection of brochures and pamphlets of different products offered by AEGON Religare study them in order to compare and contrast the different insurance products across industry. Sample selection (Random Sampling Technique) and designing of a questionnaire to collect primary data so as to map the investor perception regarding child insurance and Mutual funds available in the market. Code the data collected & identity the important factor that affect customer decision in choosing an insurance plan. Sample selection (Random Sampling Technique) and designing of a questionnaire to collect primary data to do a brand image survey of AEGON Religare Life Insurance Company. The data collected is used to do descriptive analysis (Pie charts and histogram) for mapping the brand image assessment of AEGON Religare.

3. 3.1 Research Design

Non-Probability 21

Exploratory & Descriptive Experimental Research

The research is primarily both exploratory as well as descriptive in nature. The sources of information are both primary & secondary. A well-structures questionnaire was prepared and personal interviews were conducted to collect the customers perception and buying behaviour, through the questionnaire.

3.3.2 Data Collection Techniques

Primary Data Collection Secondary Data Collection

Primary Data: The primary data was collected by a survey based on the questionnaire. It was formulated on the basis of information carefully gathered by me about the various mindsets of the people. This questionnaire was mainly formulated to target the common man to see his perception and awareness of various investment options available. The number of respondents targeted was around 150 and the survey was confined to Delhi and NCR regions

Secondary Data: The secondary data was collected directly from the companies and their websites and internet surveys. Also a lot of similar research studies and journals have been referred to.

The methodology adopted includes Questionnaire Random sample survey of customers Discussions with the concerned

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Personal interviews and informal discussions were held when I was doing market research with new customers to ascertain the awareness and existing consumers satisfaction level.

3.3.3 Sample design

3.3.3.1 Population
The sample considered is a homogenous one; the characteristics of the respondents were more or less the same. The people generally belonged to middle class strata. The results deduced can be projected on the middle class population on a wider class.

3.3.3.2 Sample size

The sample size was restricted to only 125, which comprised of people from different regions of Delhi and NCR due to time constraints.

3.3.3.3 Sampling method

Initially, a rough draft was prepared keeping in mind the objective of the research. A pilot study was done in order to know accuracy of the questionnaire. The final questionnaire was arrived only after certain important changes were done. Thus my sampling came out to be judgemental and convenient.

3.3.4 Method of data collection

3.3.4.1 Instrument for data collection

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The research was conducted on the availability of information from Primary and secondary sources:PRIMARY SOURCE OF DATA: Interaction with various investors (by Questionnaire).

SECONDARY SOURCES OF DATA: Journals, magazines etc Internet

3.3.4.2 Drafting of a questionnaire

Questionnaire consists of a number of questions printed or typed in a definite order or set of forms,the questionnaire is mailed to respondents who are expected to read and understand the questions and write down the answers in the space meant for the purpose in the questionnaire itself.But in project, Personal Interview method is also adopted for the survey. The questionnaire is not a self-administered questionnaire. This is done to avoid incorrect and biased responses. The questionnaire on an average takes 10-15 minutes. Questionnaire has been prepared for Equity Trading is shown in Annexure.

3.3.5 Limitations of the Research

i. The research is confined to a certain parts of Delhi and NCR and does not necessarily shows a pattern applicable to all of country. ii. Some respondents were reluctant to divulge personal information which can affect the validity of all responses.

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iii. In a rapidly changing industry, analysis on one day or in one segment can change very quickly. The environmental changes are vital to be considered in order to assimilate the findings. iv. The period of the project conducted is of a very short span and is subjected to have a different criterion when it is of a long term.

CHAPTER 4:
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ANALYSIS & INTERPRETATION

Comparative Analysis of Child Plan of AEGON Religare with its Competitors:

Table - 1
Product Name AEGON Religare Star Child Plan AEGON Religare Life Company Name Insurance Rs. 50,000 No Limit 10 Years 25 Years 125*Single Premium Max New York Life Kotak Child Advantage Plan Shiksha Plus Max New York Life Kotak Life Insurance Insurance Rs. 24,000 ( for 15 Rs. 4,000 annually, Rs. 2.055 -25 years terms), Rs. semi-annually, Rs. 1,060 50,000 from 5 quarterly, Rs. 350 monthly installments payment Information not Information Not Available available 15 years for regular premium and 10 years 10 Years fro 5 installments of the premium 25 Years Annual premium *cover multiple(10 26 30 Years NA

Minimum Premium Maximum Premium Minimum Term Maximum Term Minimum Sum Assured

years or 20 years) Maximum Sum 5*Single Premium Assured Minimum age at 18 Years entry of the parent Maximum age at 60 Years entry of the Parent Minimum age at 0 Years entry of the child Maximum age at 15 Years entry of the child Minimum age at Information not maturity of the available parent Maximum age at maturity of the 75 Years parent Minimum age at Information not maturity of the available Child Maximum age at Information not maturity of the available child Death Benefit Sum Assured Information not available Information not available 21 Years 55 years 0 Years 18 years Information not available 70 Years Information not available Information not available Rs.25,00,000 Information Not Available Information Not Available 0 Years 17 Years Information Not Available Information Not Available 18 Years Not Applicable

Survival Benefit

Maturity Benefit Fund Value

Free Look Period 15 Days Minimum Premium Payment 5 Years term Maximum Equal to the policy Premium payment term term Automatic Cover Information not available

100% of the sum assured , for school Sum Assured or Accumulation fees 10% of the sum Account, whichever is higher. assured p.a for 10 years Information not Information Not Available available University educationfund value , university The higher of the Basic Sum education pool Assured or the Accumulation booster- guaranteed Account will be paid on loyalty addition up to maturity. 6 years Information Not 15 Days available 15 Years 25 Years Information not available 27 Information Not Available Information Not Available Automatic cover facility is available provided premiums for first three policy years have been paid in full.

Surrender Settlement Options

Fund Options

Can be Surrendered allowed after It can be allowed after After Completion of 3 completion of 1st completion of 3 policy years Policy Years policy year Information not available Information Not Available available Growth Fund , Growth Super Fund, Secured Fund, Debt Balanced Fund, Fund, Balanced Fund Dynamic Opportunity Information Not Available and Enhanced Equity Fund, Conservative Fund Fund, Money Market Fund, Secure Fund Parents Information not available Child parents Parents Child Information Not Available Information Not Available Child

Life Assured Proposer Nominee Partial Withdrawals

Can be done after completion of 3 Policy Years Guaranteed Information not Maturity Benefits available

12 partial withdrawal Information Not Available free in a policy year Information not Information Not Available available In policy term 10 years loyalty addition is 5% of first ATP , in 15 to 25 years policy It will be available term loyalty addition is (term *2)% of first ATP available Information not available Information not available Information not available Personal Accident Benefit Rider Information Not Available Information Not Available Information Not Available Information Not Available Kotak Life Guardian Benefit(LGB), Kotak Accidental Disability Guardian Benefit(ADGB)

Loyalty additions Information not and bonus available

Minimum Top Up will be 5000 Increase/Decrease Information not of Sum Assured available Increase/ Information not Decrease of available Premium Cover It must not exceed 5 Continuation Years Option Top Up option Riders ADDD Rider and CI Rider

Mode of payment Single Pay Switching

Annually, Half Yearly, Half-yearly, Quarterly, Yearly, Quarterly and and Monthly Monthly Information Not Available

Can be done after 12 switches free in completion of 3 Policy apolicy year Years 28

Systematic Information not Transfer Option available Premium Holiday Information not Option available

Information not Information Not Available available Information not Information Not Available available Under Section 80C Under Section 80C and Section Tax Benefit is under and Section 10(10D) Tax Benefit 10(10D) of the Income Tax Act, section 80C, 10(10D) of the Income Tax 1961. Act, 1961. The lapsed policy may be revived within 2 years from the date of the first unpaid premium Policy Information not Information not by making payment of the Reinstatement available available premiums in arrears along with interest on such terms and conditions as fixed by the company. 30 Days for yearly, half-yearly, Information not Grace Period 30 Days quarterly and 15 Days for available monthly mode You can avail of a loan facility from Kotak Life Insurance Information not Loan Option Not Available against your policy after the available policy has been in force for at least 3 policy years. Top Up premium 2% of the top up 3% Information Not Available Allocation charges premium If the premium amount 10 year policy termis 12,000 to 24,999 30% (1st year). 5% 30%, 25,000 to 49,999 - ( 2nd year), 5%( 3rd Premium 25%, 50,000 to 99,999 - year onwards), 15 -25 Information Not Available Allocation charges 20%, 1,00,000 to years policy term4,99,999 - 15%, 30% (1st year), 5,00,000 and above - 30%(2nd year), 10% 5%(3rd year onwards) Growth -1.25%, Growth Super, 1.25%, Secured Fund - 1.00%, balanced -1.10%, Fund Debt Fund - 1.10%, Dynamic Management Balanced Fund - 1.25% Information Not Available opporunity1.25%, Charges and Enhanced Equity Conservative - 0.90%, Fund - 1.50% p.a. money market-1.25%, secure 0.90% Policy Rs.60 per month Administration Rs. 50 Per Month increasing @5% Information Not Available Charges annually 2 Switches in a year are Switching free of cost for 12 switches free in a Information Not Available Charges additional switches Rs. policy year 200 Per Switches 29

It is deducted on the 1.57( 25 years of first business day of age), 1.61(30 years of Mortality Charges each policy month from age, 1.83( 35 years of Information Not Available fund value by way of age, 2.49 (40 years of cancellation of units age) 1st year it is 100%, 12 1st year NA, 2nd to 23 it is 50%, 24 to 35 year-40%, 3rd year Surrender 30% of all premiums paid to it is 20%, 36 to 47 it is 30%, 4th year 20%, 5 Charges date. 10%, 48 to 59 it is 5%, th year-10%, 6th year 60 and above it is Nil onwards(NIL) 4 Partial Withdrawals 12 free partial Partial in a Year are free of withdrawals are Withdrawal cost, for additional will Information Not Available allowed in a policy Charges be charged Rs. 200 per year. withdrawal If the premium amount is 12,000 to 24,999 30%, 25,000 to 49,999 Medical Expenses 25%, 50,000 to 99,999 - Information not Information Not Available on Revival 20%, 1,00,000 to available 4,99,999 - 15%, 5,00,000 and above 10% If the premium amount is 12,000 to 24,999 30%, 25,000 to 49,999 Dread Disease with Rider Premium 25%, 50,000 to 99,999 entry age of 21 to 50 Information Not Available Charges 20%, 1,00,000 to years 4,99,999 - 15%, 5,00,000 and above 10% Growth Fund : 28.48, Growth Supper Fund : 14.83, Balanced Balanced Fund : 12.11, Fund : 21.80, Debt Fund : 14.04, Conservative Fund : Present NAV of Enhanced Equity Fund : 19.03, Money Market Information Not Available the Equity Fund 12.07, Secure Fund : Fund : 10.89, Secure 12.40, as on date of Fund : 15.98, 24.08.2011 Dynamic Opportunities Fund : 11.24 as on date of 23.08.2011 Date of Inception 21/12/2009 21/12/2009 August 2009 of the Fund Absolute Returns Balanced Fund: 21.1%, Growth Fund : Information Not Available Debt Fund : 40.4%, 184.8%, Growth Enhanced Equity Fund : Supper Fund : 48.3%, 20.7%, Secure Fund : Balanced Fund : 24.0%, as on date of 118.0%, Conservative 30

Company Website Source

Fund : 90.3%, Money Market Fund : 8.9%, Secure Fund : 59.8%, 24.08.2011 Dynamic Opportunities Fund : 12.4% as on date of 23.08.2011 www.aegonreligare.co www.maxnewyorklif http://www.insurance.kotak.com m e / The information is The information is The information collected from collected from the collected from the brochure of Kotak Life Brochure of AEGON company's brochure. Insurance company website Religare

About AEGON Religare Star Child Plan:

Summary Info

Insurance Company Plan Name Plan Nature Plan Category UIN No.

Aegon Religare Life Insurance Company Ltd AEGON Religare Star Child Plan ULIP Child Plan 138L005V02 AEGON Religare Star Child Plan not only makes provisions for children's futures but also ensures that their future remains secured. In the event of your unfortunate demise we assure a lump sum payment and waive off all future premiums till maturity. With the help of our Life Agent, fill out the Life Planner that will help you take the steps to having your own plan.

About Plan

Basic Details 31

Minimum Premium (For Regular) Minimum Premium (For Single) Minimum Entry Age Maximum Entry Age Maximum Maturity Age Minimum Sum Assured Maximum Sum Assured Minimum Policy Term Maximum Policy Term Minimum Sum Assured Minimum Sum Assured (For Single) Maximum Sum Assured (For Single) Minimum Sum Assured (For Regular) Maximum Sum Assured (For regular, for Policy term 10 to 19) Maximum Sum Assured (For Regular, for Policy term 20 to 25)

Rs. 12000 p.a Rs. 50000 p.a 0 years ( child) 15 years 75 years 1.25*single premium 5* single premium 10 yeas 25 years 5 times annualised premium. 1.25 * Single Premium 5 * Single Premium 5 times annual premium 20 * SA 30 * SA

Key Benefits

Benefits

Particulars Maturity Benefits

Description On maturity, you receive the fund value existing on maturity. If you do not wish to take the entire maturity amount at one go, you can avail of the Settlement Option. Under this option, you or the nominee after death of the Life Assured, receive maturity proceeds in 32

instalments over a periodyou choose (not exceeding 5 years). Investment risk during the settlement period is borne by you. Death Benefits Switch Benefit In case of your unfortunate demise during the term of the policy, the nominee will receive the Sum Assured. This feature helps you shift your investments from one fund to another. Four switches are free in a policy year.

You or the nominee after death of the Life Assured, can Partial partially withdraw your money after first 3 policy years. Withdrawal The maximum amount of partial withdrawal in any Benefit policy year is 50% of the fund value at the beginning of that policy year. Surrender Benefit You can surrender the policy any time after the first 3 policy years.

Tax Benefits

Section SEC 80 C

Description Under Section 80 C premiums up to Rs.100,000 are allowed as 33

deduction from taxable income. SEC 10 (10)D Maturity and Death Benefits are tax free under section 10 (10) D of the Income Tax Act, 1961.

Plan Speciality

If you opt for Invest Protect option, it will not only help you gain from your investment but also minimize the risk of returns as your policy nears maturity. It aims to protect your money by systematically shifting the Fund from the Enhanced Equity Fund to the Secure Fund during the last 3 policy years. At the end of every policy year, this feature automatically rebalances the allocation of your investments in various funds to the original proportions you had chosen. You will earn additional special units if your policy term is 15 years or more. The special units will be added to your account at the end of 10th year and every 3rd year thereafter. The value of special unit would be equal to 1.50% of the average fund value of the last 36 months before the allotment of special units. Premium Re-direction feature allows you to alter the premium allocation made by you in different funds. You have the option of choosing from 4 funds Secure, Debt, Balanced and Enhanced Equity Fund.

Under this option, you or the nominee after death of the Life Assured, receive maturity proceeds in instalments over a period you choose (not exceeding 5 years). Investment risk during the settlement period is borne by you.

34

Fund Option

Balanced Fund Debt Fund Enhanced Equity Fund Secure Fund

Particulars Balanced Fund Equities Fixed Interest Securities Money market instruments Debt Fund Fixed Interest Securities & Money Market Instruments Enhanced Equity Fund Equities Fixed Interest Securities Money market instruments Secure Fund Fixed Interest Securities & Money Market Instruments 35

Range

30% - 70% 30% - 70% 0% - 40%

0% - 100%

75% - 100% 0% - 25% 0% - 25%

0% - 100%

Latest NAV

AEGON Religare Star Child Plan - Balanced Fund AEGON Religare Star Child Plan - Debt Fund AEGON Religare Star Child Plan - Enhanced Equity AEGON Religare Star Child Plan - Secure Fund

09-Sep-11 09-Sep-11 09-Sep-11 09-Sep-11

12.2592 14.0829 12.2273 12.4495

Data Analysis:
The primary survey was planned in two stages, one to analyze the consumer behavior towards life insurance products and other was to gauge the industry potential. The sample size for consumer behavior was 63 of which 33 male and 30 female respondents of different age groups, profession & income levels. The sample size for Industry potential was 58 of which 30 male & 28 female insurance professionals.

36

4.1 Industry Potential (based on Industry people)

Gender Male Female Total

No. of Respondents 27 31 58

Total Response 47% 53% 100%

Table - 2

(a) Market share

Company LIC ICICI Prudential

Market Share 62% 11% 37

Bajaj Allianz Tata AIG HDFC Standard Life SBI Life Birla Sunlife Aviva Max Newyork Aegon Religare Others Total

5% 2.1% 2.4% 3% 2.5% 2% 2.8% 0.8% 4.4% 100%

Table - 3

Analysis: AEGON Religare being a new entrant into the market has done a good job in capturing around 0.8% of the market share and has to weave strategies to further be the market leader in the long run.

(b) Market undertreated

Market Cosmos Metros Suburbs Rural Male 0 0 12 15 Female 0 1 17 6 Total Response 0 1 29 21

Table 4

38

Analysis: This primary survey revealed that the private life insurance players were mainly urban centric and neglected the rural and suburban population.

Inference: The private life insurance sector has been focusing on the metros and cosmos and the rural and suburbs are left under treated, here the industry has high customer base and potential in future.

(c) Conversion rate lead generation to closing the sale

Conversion rate <10% 10% - 30% 30% - 50% 50%< Male 3 11 6 0 Female 1 14 9 0 Total 4 25 15 0

Table - 5

Analysis: This analysis revealed that female respondents had a better conversion rate from lead generation to closing the sale and this needs to be improved by better training programs and customer interaction.

39

Inference: The conversion rate from lead generation to closing the sale is averaging 25% and the female respondents from the industry said they had a better conversion rate than the male respondents.

(d) Brand Image of LIC has overshadowed other private insurance sector
Response YES NO Male 12 9 Female 9 14 Total 21 23

Table - 6

Analysis: It was an interesting fact that around 46% of the respondents believed that LIC brand image had overshadowed the private insurance sector.

Inference: Around 58% of the respondents said the LIC brand image has overshadowed the private life insurance sector. Hence they face a tough competition from LIC.

(e) Customer interest

Invest options Life Insurance Male 3 Female 0 40 Total 3

Mutual Funds Investment Tax savings

0 18 8

2 17 11

2 35 19

Table - 7

Analysis: Customer is more interested in high & constant returns with security they prefer investment instruments rather than life insurance or mutual funds.

Inference: The customer is more interested in investment plans than in life insurance or mutual funds and the business people mostly opted life insurance for tax savings.

(f) Customer perception Life Insurance policy

Perception Disciplined Saving Security Dead Investment Male 5 18 1 Female 4 19 2 Total 9 37 3

Table - 8

Analysis: About 80% of the customer perceived life insurance policy is a tool for securing life rather than a disciplined saving or a dead investment. The fact to be noted was very few responded that it was a dead investment.

Inference: Around 73% of the customer perceives life insurance policy as security for life against disciplined saving & dead investment. 41

(g) Recommended plans for different stages of life

Product Age group <25yrs 25 35yrs 35 50yrs 51yrs< 43 22 5 12 ULIPs Pension Plan 0 24 23 5 Term Plan Child Plan 2 36 3 1 Endowment Plan 0 0 29 1

2 15 25 6

Table - 9

Analysis: This survey revealed that most of the life advisors and business managers recommended ULIP plans to young and enthusiastic investors who could take high risk for high return, as the life stage progresses one needs to be more responsible and secure himself & his family hence opt Child plans & Pension plans for the later stage comes the Term plans & Endowment plans.

Inference: Life advisors and business managers had suggested different plans for different stages of life to the customer.

(h) Potential Customer

Potential Customer Business People Professionals Govt. Employees Male 5 17 4 42 Female 5 22 2 Total 10 39 6

Table - 10

Analysis: The survey revealed that the respondents believed that the professionals were the main customer base when compared to the business people and government employees because they were mainly concerned about their future and had better product knowledge when compared to the other two.

Inference: The main customer base was perceived to be the professionals against business people and government employees.

(i) X factor having a bearing buying an Insurance Policy

X factor Friends & Relation Policy Scheme Past Returns Brand Image Total No. of Respondents 24 10 15 15 Response 38% 23% 23% 16% 100%

Table - 11

Analysis: When the sales force was asked for what the x factor which drives the customer to buy an insurance policy almost 38% of them responded it was friends & relations who influenced then followed the brand image & past returns at the last stood policy scheme.

43

Inference: The x factor which had a bearing on customer buying an insurance policy were friends and relations and the next stood past returns, brand image & policy scheme.

(j) Customer Product Knowledge

Inference: This analysis showed that customer lacked product knowledge and the companies needed to work on this field.

44

4.2 Consumer Behavior (based on primary consumer feedback) (a) Demographic preference

(b) Invest instruments customer prefer

Invest Instruments Gold Real Estate FDs Equities Mutual Fund Insurance Male 17 21 25 6 4 20 Female 19 14 21 4 2 18 Total 36 35 46 10 6 38

Table - 12

Analysis: Interestingly this primary survey with the customer revealed that they preferred a secure channel of investment instrument rather going for a high risk and high return option. And insurance stood at the second place against gold, real estate, equities & mutual funds.

45

Inference: The investment instruments the customer preferred were the more secure than with high risk and high returns and preferred long term investments.

(c) People Insured

Gender YES NO Male 15 10 Female 12 14 Total 27 24

Table - 13

Analysis: The primary survey revealed that approximately 47% of the respondents was not insured who formed a potential customer base.

Inference: No of male respondents insured were more when compared to the female respondents this showed that responsibilities were one of the influential parameter which drove customer to buy an insurance policy.

Occupation Self employed Professional Business Other Total

YES 2 15 9 1 27

NO 5 16 2 2 24

Table - 14

46

Analysis: Self employed people were the one who were less insured when compared to other category people. Business people were the one 11 of 9 were insured. So said potential customer the professionals almost 50% of the respondents were not insured.

Inference: The primary data revealed that about 46% of the respondents from different fields were not insured and they formed a potential customer base.

(d) Customer Perception about Insurance

Customer Perception Essential Important Not required Cant say Male 7 22 0 5 Female 12 14 0 3 Total 19 36 0 8

Table - 15

Analysis: The primary survey revealed that the customer knew the importance of life insurance policy if just given a boost he can be converted into a potential customer.

Inference:

Majority of female respondents said it was essential and majority of the male

respondents said it was important for life & few were confused.

Occupation Self Employed

Essential 1

Important 6 47

Not required 0

Cant say 4

Professional Business Other Total

16 0 1 18

11 13 2 32

0 0 0 0

4 0 0 8

Table - 16

Analysis: All the segments had a familiar opinion when it comes to securing there life they all knew insurance was an essential and the most important one in securing their future.

Inference: Primary data revealed that most of the customers had an opinion that life insurance was an important criterion for their life security.

(e) Influential Parameters for an investment

Parameters Old age Savings Children Regular Income Tax saving Male 22 25 7 6 Female 18 24 8 8 Total 40 49 15 14

Table - 17

Analysis: The survey sample revealed that the most influential parameter for an investment decision was for the future of children then the old age savings followed by regular income & tax savings.

48

Inference: The male respondents were equally concerned about the old age savings and childrens future but the female respondents gave more importance to securing childrens future. Parameters Occupation Self Employed Professional Business Other Total Old age Saving 7 16 11 2 36 Children Regular Income 2 11 2 0 15 Tax saving

10 22 12 2 46

1 10 3 1 15

Table - 18

Analysis: Almost 90% of the respondents of various occupations gave the first priority to their childrens future then the old age savings when it came to investment.

Inference: Childrens future played a vital role then the old age savings were the main influential parameters for buying an insurance policy.

(f) Presumption about an Insurance Policy

Presumptions Investment Tax saving Security Disciplined Saving Male 14 12 26 6 Female 14 7 25 7 49 Total 28 19 51 13

Table - 19

Analysis: Customer presumes that an insurance policy is a security for life with other options like investment & tax saving tool following the suite.

Inference: Male and female respondents had the same response about the life insurance policy that it was for security and an investment tool. Presumptions Occupation Self employed Professional Business Other Total 5 16 5 2 28 2 11 5 1 19 10 23 11 2 46 Investment Tax saving Security Disciplined saving 3 5 3 0 11

Table - 20

Analysis: 90% of the customer of various segments agreed that life insurance policy was a tool of life security followed by an investment & tax saving tool.

Inference: Customer presumed life insurance policy as a tool for life security than an investment.

(g) Criteria for selecting Insurance Policy

50

Criteria Policy Scheme Past returns Service Brand Image

Male 17 17 13 18

Female 20 7 14 15

Total 37 24 27 33

Table - 21

Analysis: All the criteria mentioned above played a vital role in customer decision buying an insurance policy but the policy scheme stood at the top most priority followed by brand image and service.

Inference: Male respondents considered policy scheme, past returns & brand image with equal importance while selecting an insurance policy but the female respondents had a slight variation instead of past returns they had voted for a better service. Criteria Occupation Self employed Professional Business Other Total 7 19 9 0 35 6 9 6 2 23 6 14 7 0 27 7 14 8 3 32 Policy scheme Past returns Service Brand image

Table - 22

Analysis: In life insurance policy selection process customer mainly looks for policy scheme and brand image then the other criteria.

51

Inference: The primary survey revealed that the policy scheme had a major bearing on the customer decision then followed by brand image, service and past returns respectively.

(h) Opted Risk & Returns

Investment plans Aggressive Moderate Secure Male 16 14 2 Female 10 19 0 Total 26 33 2

Table - 23

Analysis: The primary survey revealed that the customer showed more interest in moderate plans that is with moderate risk and moderate returns, few mainly young respondents with long term saving plans were more interested in aggressive investment plans with high risk & high returns.

Inference: A thing to be noticed from the graph was the female respondents tend to be more moderate when compared to the male respondents and the most of the male respondents tended to have an aggressive investment plan. Investment Plan Occupation Self employed Professional Business Other 6 11 6 1 52 5 17 7 2 0 2 0 0 Aggressive Moderate Secure

Total

24

31

Table - 24

Analysis: The customer primary survey revealed that they would rather prefer a moderate risk moderate return plan than going for a high risk high return aggressive investment plan. Almost all the categories had the same opinion they were biased. But the younger population chose an aggressive plan that had a long term investment objective.

Inference: The major share of my respondents preferred to be at a moderate plan with moderate risk and moderate return rather with high risk and high return. The age of the customer also had a bearing on the decision.

(i) Channel to buy an Insurance Policy

Gender Channel Broker Agents Banks Direct Co. 2 26 2 10 1 23 13 9 3 49 15 19 Male Female Total

Table - 25

Analysis: The customer yet believed the traditional channel of buying an insurance policy that is through insurance agents when questioned for the reason they answered they preferred a personal approach with consultation rather going with improved selling channels for buying an insurance policy.

53

Inference: Both the male & female respondents tend to choose insurance agents as a channel for buying an insurance policy, but a noticeable number of female respondents chose bank as a channel for buying an insurance policy.

Channel Occupation

Broker

Agents

Banks

Direct Co.

Self Employed 0 Professionals Business Other Total 1 1 0 2

10 21 12 3 46

3 10 1 0 14

3 9 5 1 18

Table - 26

Analysis: The survey revealed that the professional had a better knowledge about the upcoming new channels for buying an insurance policy even then the traditional channel still was popular among the masses.

Inference: The customer still adopted a traditional way of buying life insurance that is through agents rather through new methods.

(j) Product Knowledge

Gender Male Female 54 Total

Products Term plan Endowment plan Child plan Pension plan ULIPs 23 4 15 7 10 22 3 15 5 7 45 7 30 12 17

Table - 27

Analysis: The customer product knowledge was limited to term plans and child plans they lacked knowledge about the new products in the market hence that knowledge of the customer needs to be updated by the companies through various channels and media.

Inference: Both the respondents had a similar knowledge about the products as they mainly preferred life security and child plans. Plans Occupation Self employed Professional Business Others Total 9 18 12 2 41 Term plan Endowment plan 2 2 2 3 9 Child plan Pension plan 1 6 4 1 12 ULIPs

8 10 6 1 25

2 8 4 1 15

Table - 28

Analysis: Most of the customers had knowledge about the term plans and the younger populace had knowledge about the ULIPs the professionals were well aware of different plans.

55

Inference: Most of the customers lacked knowledge about different plans and mainly all had a brief knowledge about the term plans.

(k) Payment mode preferred for premium

Gender Payment options Single premium Annually Half yearly Monthly 2 22 9 0 0 13 11 7 2 35 20 7 Male Female Total

Table - 29

Analysis: Majority of the respondents preferred long term payment modes that are annually and half yearly payments against a single payment or monthly installments.

Inference: The survey revealed that the male respondents were a bit hesitant in short term payments and they preferably were interested in annual premiums and the female majority was towards the half yearly premiums.

Payment options Occupation Self Employed Professional Business

Single premium

Annually

Half yearly

Monthly

0 0 2

6 13 11 56

5 13 1

0 6 0

Others Total

0 2

2 32

1 20

0 6

Table - 30

Analysis: The professional respondents were bifurcated with between half yearly and annual premium payments but the business people mainly preferred annual premium payments.

Inference: Most of the customers preferred half yearly and annual premium payments rather than on a monthly basis.

S.W.O.T Analysis
Strengths
The biggest strength of AEGON Religare - it is cash rich; which make them ignorant about the gestation period. Religare brand image & AEGON business experience has proved to be a perfect match. An already existing channel for marketing the financial products. Quality service is crux of the company mission. Investment in IT solutions in the initial stage would help in upgrading customer service and satisfaction. The unique marketing strategy of targeting the people who are already insured but under insured with the punch line KILB can prove to be USP for the company. The investment plans are well planned based on the customer preferences and life requirements when compared to the competitors and the premium allocation charges are also low; this has made the company Price competitive.

Weakness
57

Almost all the competitors in the market offer same bouquet of products with a title difference, premium and offering. New entrant to the Indian life insurance market which has a diversity of customers with different cultures, attitude & preferences. The expenses on marketing & advertisements have failed to build a brand image in the market; its still an alien in the life insurance market. More than 70% people live in rural area but AEGON Religare is more centric in urban area.

Opportunity
Huge market is literally untapped, out of 320 million insurable market only 25% of the people insured Health insurance and pension scheme, an estimated market potential of approximately $15 billion India is fast growing market and 80 to 85% people are below age of 45 Leverage the customer base of Banc assurance partner Building a strong distribution network can prove to be cash cow in the long run. Insurance literacy is increasing in India.

Threats
Entry of other private company with equal strong experience and financial strength of partner making the competition difficult and saturating the urban market. Current Govt. policies do not encourage in gross domestic saving, if the tax liabilities of the service rise the customer will have little money to invest. LIC has woken up from sleep and is following competitive strategies, its huge surplus in life fund gives a capability to lodge price war. Product differentiation is difficult in market (banc assurance). Competition is getting keener in couple of years.

Porters Five Force Model Competitive Position Analysis

Intense Competitive Rivalry
58

As AEGON Religare is a new entrant to the market has to face intense competition from the existing players who have made a strong hold in the market. When we say about competition in this market, competition is very tough. We can say that market condition is just like same as oligopoly means a few number of large firm is providing all service partially different along line of quality, feature or services. Each competitor may seek leadership in one of that major attribute and changing a price for that attribute. For example, AEGON Religare is specialist on to attract high net worth or urban population but LIC has large distribution network so they are specialist in rural segments. But when we say about population growth, economic growth or government policies insurance segment is very attractive because only 25% insurable person are insured secondly 80% population are under age of 45. Aggressive market condition is in market. Main competitors of AEGON Religare are Max New York Life Insurance, Kotak Mahindra Life insurance, HDFC, Birla Sun Life.... they are all the mammoth players in the Indian life insurance market with major chunk of the market share. LIC has many resources and it has above 50-year experience in insurance field but AEGON Religare lacks in this segment. However, due to AEGON experience and Religare brand value, AEGON Religare Cohas made good position in market. So there is threat as mainly by Max New York & Kotak Mahindra for AEGON Religare. Due to this reason price war, advertisement, and new product innovation will be expensive in future.

Threat of new entrants

Due to aggressive competition and high entry exit barrier, this is not attractive segment for new player. For entering in insurance field, mandatory capital is 100 crores. Secondly, foreign stake limited with 26%, third Indian company should have no experience in insurance business.

Threat of substitute product & technology

59

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

Threat of Buyers growing power

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

Threat of suppliers growing power

Due to oligopoly market condition insurance company cannot raise price but they can increase their profit by increase in sales. In India, the distribution chain (agent, broker, banc assurance) is growing due to increase in the number of companies entering the insurance market and this is not good for AEGON Religare.

60

CHAPTER- 5: FINDINGS & SUGGESTIONS

5.1 Findings
General findings : Wealthier, aging Indians will help transform the country's largely untapped life insurance market into one of the world's fastest growing over the next five years, a global consultancy says.

61

Life insurance is already the most popular financial product among Indians because of the tax benefits and income protection it offers in a country where there is no social security.

But with household earnings accelerating in the fast-growing economy, the life insurance income premiums market could double from 40 billion dollars to 80 billion or even 100 billion dollars by 2012, said McKinsey Co in a report.

All factors are in place for the Indian life insurance industry to blossom into one of the fastest-growing financial services markets in the world.

At the size of the market we're talking about and potential the only one with similar potential in China, the next five years will be very exciting.

Key to insurers' enthusiasm about India is its increasing affluence, aging population and low penetration of insurance coverage at a time when the market in industrialised countries is relatively saturated.

The potential in the country of 1.1 billion people can be seen from the fact the ratio of life insurance premiums to GDP -- a common measure for penetration -- is 4.1 per cent, far lower than developed market levels of 6-9 per cent.

This will change as India sees strongly accelerating household income and a more favourable demographic profile over the next two decades.

Household disposable income is seen rising by 5.3 per cent annually, much more than the 3.6 per cent annual growth over the past two decades.

With increased GDP growth there will be more income for consumers to put into life insurance.

62

Secondary data suggests the life insurance industry could witness a rise in insurance sector premiums to between 5.1 and 6.2 per cent of GDP in 2012 from 4.1 per cent.

Demand for pension cover is also seen raising, with 113 million Indians expected to be over 60 by 2016, a figure seen swelling to 179 million by 2026. "There is an untapped opportunity" in pensions where life insurance players have no meaningful presence, said the report.

Just 10 to 11 per cent of India's working population is covered by formal old-age social security schemes.

There are currently close to 30 public and private firms in India's insurance market with state-owned Life Insurance Corp of India (LIC) still holding a stranglehold of over 70 per cent.

But private players have moved aggressively, chasing for business after being allowed to compete with LIC in 2000. And overseas insurers have raced into the market despite rules limiting foreign direct investment in domestic insurers to 26 per cent.

The Congress government has been seeking to raise the FDI cap to 49 percent as part of economic reform but its communist allies fiercely oppose such a step.

AEGON Religare initial investment in technology for providing a better customer service and tracking the fund performance has created a era in the life insurance market in India.

AEGON Religares marketing strategy of educating the people about insurance and then approach them with ads and media has paid off a good deal to the company.

Religare brand name in India and the experience of AEGON has been a perfect knot to pierce into the life insurance market in India.

63

AEGON Religare work environment and a flat organisation structure has been bang on target as the employees feel at home & dont hesitate to share their point of view to their seniors.

AEGON Religare is mainly targeting the urban people precisely the white collared employees for ex. Sectors like IT, BT, Infrastructure, Govt.....

Gurukul session in AEGON Religare has been of great help to employees for enhancing the overall performance and updating the product knowledge and changes in the market.

There are two sales channel in AEGON Religare Company Business Manager Life Advisor Customer Company Sales Manager Corporate Customer

Customer has a set mind frame that insurance calls for LIC & new players entering the life insurance market have to face a tough competition in this regard.

When it comes to private players ICICI has been the major player with about 10% of the market share and has been in the market since 2000.

Statistical findings from primary data

A. Industry Survey The rural and suburban markets are undertreated which has large customer base to exploit. Conversion rate from lead generation to closing the sale is @ an average of 25% and female insurance employees have better conversion rate when compared to male employees. Around 48% of my sample size agreed that brand image of LIC has overshadowed other private insurance sector.

64

Primary survey revealed that customer prefers investment plans & tax savings rather than life insurance & mutual funds.

Customer perception about life insurance policy, he looks at it as his future security for him & his family then comes discipline saving.

In the primary survey the industry people suggested some plans what they would offer their customer for different stages of life, below the younger the age better is the ULIP plan as the responsibilities keep growing plans keep adding up Child plans, Term Plans, Endowment Plans, Pension Plans.

Insurance sector has mainly targeted the professionals as their main customer base next stands the business people and then the govt. employees.

When the life advisors and business managers were questions about what do they is the x factor which has a bearing on the customer decision for buying an Insurance policy the major chunk went to friend & relations, second preference was shared by past returns & brand image of the company equally and the last stood policy scheme.

When they were asked about, how does the customer they deal with know about Insurance products, it was rated 38% at an average. That meant customer lack knowledge about the products.

B. Customer survey When customer was surveyed about the investment instruments they would prefer most of them preferred a more secure one the FDs in banks surprisingly next stood insurance later places where occupies by gold, real estate, equities & at the last mutual funds. This meant customer preferred security than high returns. Primary survey revealed that 49% of the sample size where not insured that meant they are still the untouched customer base, it is the same when we take the whole insurance market. 65

It also revealed that the business people were better insured when compared to the professionals and self employed.

When questioned about the customer perception about insurance around 54% said it was important, 35% said it was essential remaining where yet to make a decision but interestingly no one said it wasnt required.

There were different influential parameters which had influence to make an investment decision first preference was children then came the old age savings then regular income and tax saving.

When customer was asked about his presumption about an insurance policy he said it was security for his life then secondly an investment, third a tax saving instrument and lastly a tool to enhance the habit of disciplined saving.

Customer said the main criteria for selecting an insurance policy was policy scheme then the brand image, service & past returns.

Most of them opted to have moderate risk and moderate returns, few opted to be aggressive & very few preferred to be secure.

When the customer was questioned about their knowledge about different life insurance products almost all knew about the term plans then came the child plan, ULIPs, pension plans & endowment plans.

The customer preferred to make premium payments annually firstly and the second preference was half yearly payments.

5.2 Suggestions
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In order to succeed in any business it is very essential to make and follow the strategies. Strategies are very important for any of the business. Following are the few strategies, which I recommend to the insurance sector. One approach is to focus upon product quality, which will instil confidence in minds of the customers that they would be offered best product from out of the several available products. The other approach, is to focus on the customers need, would involve a heavy investment in developing relationships with policyholders. Under this approach, one can expect a range of products and services designed to give the customer what he desires. The third approach is of greater market segmentation under which the population should be divided into several homogeneous groups, products and services would be targeted towards such selected markets. The effort would be to tag clients to the company- by customized combination of coverage, easy payment plan, risk management advice, and convenient quick claim handling. Porter Generic Strategies: One of the expert Michel porters has identified four internally consistent generic strategies, which can be used singly or in combination: Overall cost leadership is clearly under stable. In a differentiation strategy, a company seeks to be unique in its industry along some dimensions that are widely valuable by the customer. May be the lowest cycle time for settling a claim under say, a med claim policy could be differentiating factor. In a cost focus, a company seeks a cost advantage in its target segment. While in differentiation focus; a company seeks a differentiation target.

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Key Strategy to Success:

Marginally Different Product : Another strategy would be for the companies to design products that will make Comparisonshopping difficult. They could offer a wide variety of covers with marginal differences and varying prices, whose terms and conditions are difficult to compare for consumers who may not have sufficient experience in purchasing insurance and who would find it difficult to make a clear choice. If the consumer is offered a unique policy, he will have no alternative coverage with which can be compared. Given the combination policy, which can offer protection against a number of losses, the consumer will find comparison even more difficult.

Designing New Strategies: 68

The existing insurance companies cannot be satisfied with concentrating on the consolidation of their existing markets, but have to achieve further growth and penetration. They must, therefore concentrate on strengthening existing points of service, designing new channel of distribution, direct contact with their ultimate customers, and front line employee empowerment. They also need to refresh their marketing set up. The new comers, on the other hand give priority to tapping the market, left unexploited by the public sector companies. Move towards Rural Market:

It is one of the most important suggestions; data says that rural market is still untreated by the private insurance sector. We believe that the sector should move towards rural market. Insurance penetration can be achieved by tapping the neglected Rural Markets. There is vast potential for insurance growth in the rural sector. A recent survey by foundation for research, training and Education in insurance (FORTE) suggests that insurance can be sold profitably to rural communities in India. The survey reveals that, 1. There is distinct hierarchy of needs in rural areas. 2. Rural people find security in groups. 3. The saving habit is very strong in rural areas. 4. Average saving across the most important socio-economic strata comes to 30-35% of annual income or Rs. 13,500 annually, which is significant. 5. There is high level of awareness about life insurance and fairly high-level about 36% already own life insurance. 6. 51% of these who own life insurance would like to buy more. 7. Amongst the savers, a significant percentage does not save through formal financial modes or institutions. 8. Rural buyers of insurance prefer a half yearly mode of premium payment to coincide with the time of the harvest. 9. Thus there are very much chances for any of the companies to work over this scenario. So we believe and suggest all the players to move towards the rural areas.

Motivation of sales force:

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A life insurance company should constantly be involved in the process of motivating the sales force in the turbulent times. The strategies I recommend; 1. Building relationship is real perk. One should be sure to build in networking times for agents during the program-in addition to entertainment and education. 2. Internet can be frequently used for creating gift ideas. 3. Hold sales contests in the fourth quarter. It is the best times to motivates agents who wants to qualify for a trip. 4. Consider a contrast within the contest for- top-tier producers; additional rewards for additional milestones that are met, such as air and guest room upgrades. Use of Internet:

1. The present scenario is such that the products are sold with the help of Internet. The technological advancement is such that force the companies to take such steps. Still the fullfledged use of Internet is not done in our country. As suggestion earlier the Internet based life insurance will help the companies to reduce the transaction cost and time. 2. At the time it can improve the quality of service to its customers, which is the mission of the company. 3. Company should concentrate on the quality of the premium received this will help the companies to reduce its underwriting losses. 4. Appointing of proper and efficient agent as well as effective direct marketing could do this. 5. One can downsize the excessive staffs, by this company could reduce management expense to a large extent.

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Rough Sketch of Customer to Customer Approach:

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CHAPTER:6
RECOMMENDATIONS AND CONCLUSION

CONCLUSION:

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In a nutshell, I have learned about various aspects of insurance market. Beside this I also come to know the insight of Life Insurance, General Insurance and number of insurance products and theirs various aspects as my first object was to know about these products. Through market research, as I conducted with 125 people, I came to know that awareness and the interest for the insurance has increased. Most of the people are ready to invest and ready to take insurance but as the companies are approaching differently so they are confused and so they preferred to go for the govt. companies rather than the private ones because the customers do believe the govt. companies transparency instead of the private companies hidden terms and conditions. Now last part of the objective was location mapping or to find out the potential market of Delhi. After the research and market survey I come to know that the places like south Delhi regions where market areas has a great opportunity. The people especially the businessmen are ready for investment. Many of them are also trading now but if they got better business plan then they will switch over to the company. So these places should be taken as productive places by the marketing people. As per the data analysis of comparing the child insurance of AEGON Religare with its competitors, I have reached on the conclusion that the plan of AEGON Religare is suitable for the customers. Here I conclude that the summer internship program, done in AEGON RELIGARE Life Insurance company, has been completed successfully. Following are the achievements done during the summer internship from 08th June 10th August 2011: a. Survey done with interest of AEGON RELIGARE has been conducted successfully and targets are achieved. b. The experience gained during the internship has sharpened my marketing and negotiable skills and given me a great on the field experience.

RECOMMENDATIONS:
AEGON Religare has to improve its distribution network as its reach to a common man is very limited .Also the number of agents working for the company is very less right now when compared to the other companies 73

The company should constantly come out with innovative products as the competition is very tough with around 22 companies fighting hard for the market share. Some new innovative ideas have been suggested below:

An insurance plan for the unborn babies. The premium payment term could be for 6 months and it could start once the fetus is 3 months old inside the mothers womb. There could be various benefits under this plan for the customers like in case of a premature or a complicated birth the company would bear the expenses till the baby is healthy again through the insurance policy. Also there could be death benefits in case of the death of the baby inside the womb or at the time of delivery. This plan could really be successful as in India there are lot of premature child deaths and if the company comes out with a plan like this very tactfully with some implied conditions it would be the first Indian company to offer insurance to unborn babies.

An insurance plan for mentally retarded and physically handicapped people. This might be hard to digest but if at all plans like these are possible and really come out then a good amount of Indian population would really be interested.

The company could also come out with a plan for both the husband and wife where automatically the wife gets insured along with her husband when her husband purchases the policy. This could also be the other way round. This could be called the combo family plan. In simple words it means buy one policy and get another free. No other company has done something like this till now.

As the company is a new company it has to really work hard to get itself promoted. The company could start sponsoring major events and conduct talk shows and seminars to get noticed. It could also take the help of NGOs. There are many people in India who still do not know about the concept of insurance. The company could take this as an opportunity by trying create awareness.

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The company could start using star personalities for their endorsements especially cricket stars and film stars as India is a nation of crazy cricket and film followers and there is nothing better than reaching to the hearts of people through cricket.

The company should come out with some really outstanding and out of the world advertisements like the ones Vodafone has released recently which people find it hard to forget soon.

The company should first promote the brand AEGON Religare and create a positive impression in the minds of the people.

BIBLIOGRAPHY
Reference books

Planed P.S and Shah R.S; Insurance in India, Response books-2008 Insurance 4th edition CIB Publicaion-2009 Principles of marketing- Philip Kotler (Pearson) 2009 75

Life insurance IRDA 2009

Magazine
Life insurance vol 1 ICFAI PRESS 2009 Life insurance vol 2 ICFAI PRESS 2009 Insurance industry Emerging Trends ICFAI PRESS 2009 Insurance law and regulation vol 1ICFAI PRESS 2009

Web sites
www.irdaindia.org www.aegonreligare.com www.management paradise.com www.equitymaster.com www.licindia.com www.incometaxindia.gov.in www.google.com www.wikipedia.com www.livemint.com www.welipedia.com

Newspaper
Economic times Times of India Business standard

ANNEXURES
QUESTIONNAIRE
(This questionnaire is only of the sake of some research work being done on insurance companies. Confidentiality would be maintained.) 76

Name : _________________________________________________________________

Gender : Male

Female

Contact no : _______________________________

Age Group:______________________ 18-30 31-40 41-50 >50

Qualification: _____________________ Post Graduate Graduate 12th < 12th Occupation:__________________ Government Service Businessman Private Company Self Employed Any Other (Please specify) ____________________ Your income range (per annum): _____________________ Below 150000 150000-250000 250000-350000 350000-450000 More than 450000

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Your savings per year:________________________ Below 10000 10000-25000 25000-50000 50000-100000 More than 100000 Q.1) You would prefer savings in which form? Bank deposits Fixed deposits Investments Post Office schemes Any other (please specify) _________________________

Q.2) What do you consider while making an investment decision? Familys opinion Friends advice Brokers advice Your own decision Any other (please specify)_________________________

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Q.3) Your opinion about investment: Tax Saving Good returns Better future After retirement Wealth creation Any other (please specify) _________________________

Q.4) Preferably you would like to invest in: Mutual funds Stocks and shares Insurance products Govt. Bonds & securities Any other (please specify) _____________________

Q.5) How frequently do you invest? Once a year 2-3 times a year More than 3 times a year Not investing (no idea) Not interested

Q.6) Do you agree that Insurance products are susceptible to very low risk when compared to the other options for investment ? Yes No Dont know 79

Q.7) What do you understand by the term Wealthsurance? Tax savings plan Savings plan with good returns Financial security and risk coverage for your family All the above I have no idea

Q.8) Name three insurance companies that come to your mind:

1. ___________________________________ 2. ___________________________________ 3. ___________________________________

Q.9) Do you own an insurance policy? Yes No If yes in which company ______________________

Q.10) According to you what is the amount of risk involved in Child Insurance Plans? High risk Moderate risk Low risk They are Safe No Idea

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Q.11) Rate the following companies (on a scale of 1-5)

Ratings

Company AEGON Religare_____ ICICI Prudential______ Life Insurance Corporation of India_______ Bajaj Allianz _______ Max NewYork Life Insurance__________ KOTAK Mahindra _________

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