A

SUMMER TRAINING PROJECT REPORT

ON

“RECRIUTMENT AND SELECTION IN BHARTI INFRATEL”

Submitted for the partial fulfilment of the requirements

For the award of degree

Of

MASTERS OF BUSINESS ADMINISTRATION

Degree Programmed of G.B. Technical University, NOIDA

(2009-2
Submitted by
AMIT KUMAR

M.B.A. III Sem.

Roll No. 0927170007

Submitted To

Bharat Institute of Technology

Partapur Byepass, Meerut

(Affiliated to Uttar Pradesh Technical University, LUCKNOW)

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 STUDENT DECLARATION

I Rachna singh student of MBA III Semester from Bharat Institute of Technology.

Here by declares that the project report titled “RECRUITMENT AND SELECTION

IN BHARATI INFRATEL” is completed and submitted under the valuable guidance of

Ms. Parul Agarwal Faculty of Management.

The imperial finding in this report is based on the data collected by me. This project has

not been submitted to U.P.T.U., Lucknow or any other university for the purpose of

compliance of any requirement of any examination or degree.

Date………………. AMIT KUMAR

Roll No.0927170007
MBA (III) sem

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 ACKNOWLEDGEMENT

‘When a person is help, guide and co-operated his or her heart is bound to pay

gratitude.’

It is not a single man’s effort which is sufficient for the accomplishment of a Research.

Various factors, situations and persons integrate to provide the background for

accomplishment of a task requires the effort of so many people and the work is no

different.

I acknowledge here the names of those people who have been instrumental in

preparation of this Research.

Firstly, I would like to thank my project guide Mr. Mukul Raghav, H.R. Manager,

Bharti Infratel Centre, United World Cyber Work, Noida, who has been a constant

source of inspiration for me during the completion of this project. He gave me invaluable

inputs during our endeavor to complete this project.

I am sincerely indebted to Mr. M.P. Sharma (Administrator) for his valuable

suggestion and inspiration to undergo this study and his unstilted help which he gave

for the completion of this Research.

My grateful thanks are also due to various others technocrats, who inspire of there

multifarious pre-occupation, were kind enough to spare time to grant me personal help

and others cooperative activities. I would also like to thanks co-operation for providing

the recruitment & selection and supplemental information used in this study.

AMIT KUMAR
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 PREFACE

The purpose of my research report was to learn the practical application of Recruitment

and Selection Process and its importance in Bharti Infratel along with the HR policies of

Bharti Infratel which prides itself to be the market leader.

While carrying out the study I have gained a good amount of knowledge and insights of

how HR department works but I have touched the tip of iceberg. There was more to learn

but due to constraint of time it was not possible. The HRD manager has to work with the

missionary spirit. Unlike many roles in an organization where tangible short- term

benefits can be obtained, it is difficult for HRD functionary to demonstrate any tangible

short- term accomplishment. Yet HRD managers are tempted to show to the top

management, line manager and themselves that they are making things happen through

training program, recruitment& selection.

In Bharti Infratel a meticulously natural team stands at the very heart of the group. 4,000

Personnel evince perfect camaraderie. A steadfast dedication to qualify an attainment of

maximum team potential is the touchstones of the company.

The company is engaged in constant learning process through intensive selection and

training program. Indeed, the aspiration is to shape a winning team of self motivated,

empowered, professionals with knowledge and confidence to take independent decision.

Bharti Infratel recognizes each employee’s individuality, ability and efforts and also

applauds for their contribution to the success of the group.

AMIT KUMAR

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 TABLE OF CONTENTS

 Introduction 1

 Objective of Study 36

 Recruitment & selection process in Bharti Infratel 38

 Research methodology 44

o Research design 66

o Data collection 69

 Data Analysis 71

 Findings 85

 Limitations 88

 Conclusion 90

 Recommendations 93

 Bibliography 97

 Questionnaire 99

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 CHAPTER 1: INTRODUCTION
OF THE STUDY

6
 CHAPTER 1: INTRODUCTION OF THE STUDY

This study is based on a comparison between the Life Insurance Corporation of

India with its competitors. The competitors are basically the private insurance companies

for example- Bharti AXA, AEGON Religare, ICICI Prudential, Birla Sun Life etc.

Private Players in the life insurance business are growing at a scorching pace.

Within three years of their inception, they have seized about 14 percent of the market.

There is another dimension to the insurance numbers game. While the private insurance

CHAPTER 1: INTRODUCTION
companies have attained 13 to 14 percent share of the overall insurance market, their

OF THE STUDY
share in key metros (Mumbai and Delhi) is as high as 30 to 40 percent.

Private insurance companies are essentially joint ventures with global insurance

companies holding a maximum of 26 percent stake. The foreign partners are investing

heavily in the Indian market and, thereby, driving sales, because they see India emerging

as one of the biggest markets in the Asian region.

Private players have certainly done their bit to increase the penetration levels of

insurance, mainly by creating alternative distribution channels while in contrast most of

the LIC policies continue to be sold through its tied agency network. The multi-channel

approach adopted by private insurance companies has proved to be a boon in terms of

costing and their ability to capture business.

This partly explains why the LIC increased its advertising spend multifold since

the insurance sector was privatized. Its ad spend more than doubled to Rs 81 crore in the

fiscal 2003, against Rs 37 crore in 1999-2000, prior to the insurance industry being

privatized. Of course, the private insurers sector also steadily increased their ad spend,

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from Rs 29 crore in fiscal 2001when the industry opened up, to Rs 92 crore the following

year. In fiscal 2003, private insurers spent Rs 143 crore on advertising.

According to the annual report 2008-2009, the major expense of private insurers

were employee expenses at 39.08 percent; advertisement /publicity at 8.92 percent;

training expenses at 5.96 percent. Employee remuneration and welfare benefits accounted

for 60.75 percent of the operating expense of LIC (8309.32 crore). As the private insurers

have leaner organizational structure their average worked out to be 47.93 percent as

against 48.11 percent in 2007-2009. Advertisement and publicity expense of LIC

accounted for 2.44 percent of the total operating expense; training expense accounted for

1.73 percent of the total operating expense.

There is also a difference in the target client of the private and the LIC. While the

private players are targeting the upper middle class and high net worth individuals, the

LIC aims for the masses through its 2048 branches spread across semi rural and rural

towns.

Life insurance industry recorded a premium income of Rs. 201351.41 crore

during 2008-09 as against Rs. 156075.85 crore in the previous financial year. The first

year premium (comprising of single premium and regular premium) amounted to Rs.

93712.52 in 2007-08 as against Rs. 75649.21 crore in 2006-07 recording a growth of

23.88 per cent as against a growth of 94.96 per cent in 2006-07. The first year premium

growth in 2007-08 over a higher growth in 2006-07 has been on account of continued

popularity of unit linked products. It is observed that LIC too has shifted its marketing

strategy in favour of unit linked products since 2006-07 though LIC’s performance has

slowed down in 2007-08. LIC reported growth of 24.17 per cent in single premium

8
individual policies and decline of 6.48 per cent in non-single premium individual

policies. As against these, private insurance companies reported growth of 39.45 per cent

and 69.93 per cent in individual single and non-single policies respectively.

The size of life insurance market increased on the strength of growth in the

economy and concomitant increase in per capita income. This resulted in favourable

growth in total premium for both LIC (17.19 per cent and private insurers (82.50 per

cent) in 2007-08. Private insurers have improved their market share from 18.10 per cent

in 2006-07 to 25.61 per cent in 2007-08 in the total premium collected during the year.

The life industry paid gross benefits of Rs. 61780.02 crore in 2007-08 constituting

30.68 per cent of the gross premium underwritten (35.73 per cent in 2006-07). The

benefits paid by the private insurers showed an increase of 111.28 per cent at Rs. 5212.24

crore, constituting 10.11 per cent of the premium underwritten (8.73 per cent in 2006-07).

LIC paid benefits of Rs. 56567.78 crore in 2007-08, constituting 37.76 per cent of the

premium underwritten (Rs. 53298.41 crore in 2006-07) constituting 41.70 per cent of the

total premium underwritten.

However a certain part of the market has been captured by the private players,

LIC has not lost its position. LIC remains by far the largest player in the market. Among

the private sector banks ICICI Prudential is the largest followed by Bajaj Allianz. It was

reported that the customers resorted to LIC after the awareness about insurance increased

as a result of the marketing efforts of the new players, because they were attracted by the

‘security factor’ attached with the state owned insurer.

9
.

CHAPTER 2: INSURANCE

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 CHAPTER 2: INSURANCE

Insurance, in law and economics, is a form of risk management primarily used to

hedge against the risk of a contingent loss. Insurance is defined as the equitable transfer

of the risk of a loss, from one entity to another, in exchange for a premium, and can be

thought of as a guaranteed small loss to prevent a large, possibly devastating loss. An

insurer is a company selling the insurance; an insured is the person or entity buying the

insurance. The insurance rate is a factor used to determine the amount to be charged for

a certain amount of insurance coverage, called the premium.

Principles of insurance

Commercially insurable risks typically share seven common characteristics: -

1. A large number of homogeneous exposure units.

The vast majority of insurance policies are provided for individual members of

very large classes. Automobile insurance, for example, covered about 175 million

automobiles in the United States in 2004. The existence of a large number of

homogeneous exposure units allows insurers to benefit from the so-called “law of large

numbers” which in effect states that as the number of exposure units increases, the actual

results are increasingly likely to become close to expected results. There are exceptions to

this criterion. Lloyd’s of London is famous for insuring the life or health of actors,

actresses and sports figures. Satellite Launch insurance covers events that are infrequent.

Large commercial property policies may insure exceptional properties for which there are

no ‘homogeneous’ exposure units. Despite failing on this criterion, many exposures like

these are generally considered to be insurable.

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 2. DEFINITE LOSS.

The event that gives rise to the loss that is subject to the insured, at least in

principle, take place at a known time, in a known place, and from a known cause. The

classic example is death of an insured person on a life insurance policy. Fire, automobile

accidents, and worker injuries may all easily meet this criterion. Other types of losses

may only be definite in theory. Occupational disease, for instance, may involve

prolonged exposure to injurious conditions where no specific time, place or cause is

identifiable. Ideally, the time, place and cause of a loss should be clear enough that a

reasonable person, with sufficient information, could objectively verify all three

elements.

3. ACCIDENTAL LOSS.

The event that constitutes the trigger of a claim should be fortuitous, or at least

outside the control of the beneficiary of the insurance. The loss should be ‘pure,’ in the

sense that it results from an event for which there is only the opportunity for cost. Events

that contain speculative elements, such as ordinary business risks, are generally not

considered insurable.

4. LARGE LOSS.

The size of the loss must be meaningful from the perspective of the insured.

Insurance premiums need to cover both the expected cost of losses, plus the cost of

issuing and administering the policy, adjusting losses, and supplying the capital needed to

reasonably assure that the insurer will be able to pay claims. For small losses these latter

12
costs may be several times the size of the expected cost of losses. There is little point in

paying such costs unless the protection offered has real value to a buyer.

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 5. AFFORDABLE PREMIUM.

If the likelihood of an insured event is so high, or the cost of the event so large,

that the resulting premium is large relative to the amount of protection offered, it is not

likely that anyone will buy insurance, even if on offer. Further, as the accounting

profession formally recognizes in financial accounting standards, the premium cannot be

so large that there is not a reasonable chance of a significant loss to the insurer. If there is

no such chance of loss, the transaction may have the form of insurance, but not the

substance.

6. CALCULABLE LOSS.

There are two elements that must be at least estimable, if not formally calculable:

the probability of loss, and the attendant cost. Probability of loss is generally an empirical

exercise, while cost has more to do with the ability of a reasonable person in possession

of a copy of the insurance policy and a proof of loss associated with a claim presented

under that policy to make a reasonably definite and objective evaluation of the amount of

the loss recoverable as a result of the claim.

7. LIMITED RISK OF CATASTROPHICALLY LARGE LOSSES.

The essential risk is often aggregation. If the same event can cause losses to

numerous policyholders of the same insurer, the ability of that insurer to issue policies

becomes constrained, not by factors surrounding the individual characteristics of a given

policyholder, but by the factors surrounding the sum of all policyholders so exposed.

Typically, insurers prefer to limit their exposure to a loss from a single event to some

small portion of their capital base, on the order of 5 percent. Where the loss can be

14
aggregated, or an individual policy could produce exceptionally large claims, the capital

constraint will restrict an insurer's appetite for additional policyholders.

The classic example is earthquake insurance, where the ability of an underwriter

to issue a new policy depends on the number and size of the policies that it has already

underwritten. Wind insurance in hurricane zones, particularly along coast lines, is another

example of this phenomenon. In extreme cases, the aggregation can affect the entire

industry, since the combined capital of insurers and reinsurers can be small compared to

the needs of potential policyholders in areas exposed to aggregation risk. In commercial

fire insurance it is possible to find single properties whose total exposed value is well in

excess of any individual insurer’s capital constraint. Such properties are generally shared

among several insurers, or are insured by a single insurer who syndicates the risk into the

reinsurance market.

History of insurance

In some sense we can say that insurance appears simultaneously with the

appearance of human society. We know of two types of economies in human societies:

money economies (with markets, money, financial instruments and so on) and non-

money or natural economies (without money, markets, financial instruments and so on).

The second type is a more ancient form than the first. In such an economy and

community, we can see insurance in the form of people helping each other. For example,

if a house burns down, the members of the community help build a new one. Should the

same thing happen to one's neighbor, the other neighbors must help? Otherwise,

neighbors will not receive help in the future. This type of insurance has survived to the

present day in some countries where modern money economy with its financial

15
instruments is not widespread (for example countries in the territory of the former Soviet

Union).

Turning to insurance in the modern sense (i.e., insurance in a modern money

economy, in which insurance is part of the financial sphere), early methods of

transferring or distributing risk were practiced by Chinese and Babylonian traders as long

ago as the 3rd and 2nd millenia BC, respectively. Chinese merchants travelling

treacherous river rapids would redistribute their wares across many vessels to limit the

loss due to any single vessel's capsizing. The Babylonians developed a system which was

recorded in the famous Code of Hammurabi, c. 1750 BC, and 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 lender's guarantee to cancel

the loan should the shipment be stolen.

Achaemenian monarchs of Iran were the first to insure their people and made it

official by registering the insuring process in governmental notary offices. The insurance

tradition was performed each year in Norouz (beginning of the Iranian New Year); the

heads of different ethnic groups as well as others willing to take part, presented gifts to

the monarch. The most important gift was presented during a special ceremony. When a

gift was worth more than 10,000 Derrik (Achaemenian gold coin) the issue was

registered in a special office. This was advantageous to those who presented such special

gifts. For others, the presents were fairly assessed by the confidants of the court. Then the

assessment was registered in special offices. The purpose of registering was that

whenever the person who presented the gift registered by the court was in trouble, the

monarch and the court would help him.

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 A thousand years later, the inhabitants of Rhodes 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 sinkage.

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. The Talmud deals with several aspects

of insuring goods. 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.

Separate insurance contracts (i.e., insurance policies not bundled with loans or

other kinds of contracts) were invented in Genoa in the 14th century, as were insurance

pools backed by pledges of landed estates. These new insurance contracts allowed

insurance to be separated from investment, a separation of roles that first proved useful in

marine insurance. Insurance became far more sophisticated in post Renaissance Europe,

and specialized varieties developed.

Toward the end of the seventeenth century, London's growing importance as a

centre for trade increased demand for marine insurance. In the late 1680s, Edward Llyod

opened a coffee house that became a popular haunt of ship owners, merchants, and ships’

captains, and thereby a reliable source of the latest shipping news. It became the meeting

place for parties wishing to insure cargoes and ships, and those willing to underwrite such

ventures. Today, Llyod’s of London remains the leading market (note that it is not an

17
insurance company) for marine and other specialist types of insurance, but it works rather

differently than the more familiar kinds of insurance.

Insurance as we know it today can be traced to the Great fire of London, which in

1666 devoured 13,200 houses. In the aftermath of this disaster, Nicholas Barbon opened

an office to insure buildings. In 1680, he established England's first fire insurance

company, "The Fire Office," to insure brick and frame homes.

The first insurance company in the United States underwrote fire insurance and

was formed in Charles Town (modern-day Charleston), South Carolina, in 1732.

Benjamin Franklin helped to popularize and make standard the practice of insurance,

particularly against fire in the form of perpetual insurance. In 1752, he founded the

Philadelphia Contribution for the Insurance of Houses from Loss by Fire. Franklin's

company was the first to make contributions toward fire prevention. Not only did his

company warn against certain fire hazards, it refused to insure certain buildings where the

risk of fire was too great, such as all wooden houses. In the United States, regulation of

the insurance industry is highly Balkanized, with primary responsibility assumed by

individual state insurance departments. Whereas insurance markets have become

centralized nationally and internationally, state insurance commissioners operate

individually, though at times in concert through a national insurance commissioners’

organization.

TYPES OF INSURANCE

Any risk that can be quantified can potentially be insured. Specific kinds of risk

that may give rise to claims are known as "perils". An insurance policy will set out in

18
detail which perils are covered by the policy and which is not. Below are (non-

exhaustive) lists of the many different types of insurance that exist. A single policy may

cover risks in one or more of the categories set out below. For example, auto insurance

would typically cover both property risk (covering the risk of theft or damage to the car)

and liability risk (covering legal claims from causing an accident).

1. BUSINESS INSURANCE

It can be any kind of insurance that protects businesses against risks. Some

principal subtypes of business insurance are (a) the various kinds of professional liability

insurance, also called professional indemnity insurance, and (b) the business owner's

policy (BOP), which bundles into one policy many of the kinds of coverage that a

business owner needs, in a way analogous to how homeowners insurance bundles the

coverages that a homeowner needs.

2. AUTO INSURANCE

Auto insurance protects you against financial loss if you have an accident. It is a

contract between you and the insurance company. You agree to pay the premium and the

insurance company agrees to pay your losses as defined in your policy. Auto insurance

provides property, liability and medical coverage:

a. Property coverage pays for damage to or theft of your car.

b. Liability coverage pays for your legal responsibility to others for bodily injury or

property damage.

c. Medical coverage pays for the cost of treating injuries, rehabilitation and

sometimes lost wages and funeral expenses.

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 An auto insurance policy is comprised of six different kinds of coverage. Most

countries require you to buy some, but not all, of these coverages. If you're financing a

car, your lender may also have requirements. Most auto policies are for six months to a

year.

3. HOME INSURANCE

It provides compensation for damage or destruction of a home from disasters. In

some geographical areas, the standard insurances exclude certain types of disasters, such

as flood and earthquakes that require additional coverage. Maintenance-related problems

are the homeowners' responsibility. The policy may include inventory, or this can be

bought as a separate policy, especially for people who rent housing. In some countries,

insurers offer a package which may include liability and legal responsibility for injuries

and property damage caused by members of the household, including pets.

4. HEALTH INSURANCE

Health insurance policies by the National Health Service (U.K.) or other publicly-

funded health programs will cover the cost of medical treatments. Dental insurance, like

medical insurance, is coverage for individuals to protect them against dental costs. In the

U.S., dental insurance is often part of an employer's benefits package, along with health

insurance.

5. DISABILITY INSURANCE

Disability Insurance policies provide financial support in the event the

policyholder is unable to work because of disabling illness or injury. It provides monthly

support to help pay such obligations as mortgages and credit cards.

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  Disability overhead insurance allows business owners to cover the overhead

expenses of their business while they are unable to work.

 Total permanent disability insurance provides benefits when a person is

permanently disabled and can no longer work in their profession, often taken as

an adjunct to life insurance.

 Workers’ compensation insurance replaces all or part of a worker's wages lost

and accompanying medical expenses incurred because of a job-related injury.

6. CASUALTY INSURANCE

Casualty insurance insures against accidents, not necessarily tied to any specific

property. Crime insurance is a form of casualty insurance that covers the policyholder

against losses arising from the criminal acts of third parties. For example, a company can

obtain crime insurance to cover losses arising from theft or embezzlement.

Political risk insurance is a form of casualty insurance that can be taken out by

businesses with operations in countries in which there is a risk that revolution or other

political conditions will result in a loss.

7. LIFE INSURANCE

Life insurance provides a monetary benefit to a decedent's family or other

designated beneficiary, and may specifically provide for income to an insured person's

family, burial, funeral and other final expenses. Life insurance policies often allow the

option of having the proceeds paid to the beneficiary either in a lump sum cash payment

or an annuity. Annuities provide a stream of payments and are generally classified as

insurance because they are issued by insurance companies and regulated as insurance and

21
require the same kinds of actuarial and investment management expertise that life

insurance requires.

Annuities and pensions that pay a benefit for life are sometimes regarded as

insurance against the possibility that a retiree will outlive his or her financial resources.

In that sense, they are the complement of life insurance and, from an underwriting

perspective, are the mirror image of life insurance. Certain life insurance contracts

accumulate cash values, which may be taken by the insured if the policy is surrendered or

which may be borrowed against. Some policies, such as annuities and endowment

policies, are financial instruments to accumulate or liquidate wealth when it is needed. In

many countries, such as the U.S. and the UK, the tax law provides that the interest on this

cash value is not taxable under certain circumstances. This leads to widespread use of life

insurance as a tax-efficient method of saving as well as protection in the event of early

death.

8. PROPERTY INSURANCE

Property insurance provides protection against risks to property, such as fire, theft

or weather damage. This includes specialized forms of insurance such as fire insurance,

flood insurance, earthquake insurance, home insurance, inland marine insurance or boiler

insurance.

Driving School Insurance provides cover for any authorized driver whilst

undergoing tuition, cover also unlike other motor policies provides cover for instructor

liability where both the pupil and driving instructor are equally liable in the event of a

claim.

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 Aviation insurance insures against hull, spares, deductibles, hull wear and

liability risks.

Boiler insurance (also known as boiler and machinery insurance or equipment

breakdown insurance) insures against accidental physical damage to equipment or

machinery.

Builder’s risk insurance insures against the risk of physical loss or damage to

property during construction. Builder's risk insurance is typically written on an "all risk"

basis covering damage due to any cause (including the negligence of the insured) not

otherwise expressly excluded.

Crop insurance: "Farmers use crop insurance to reduce or manage various risks

associated with growing crops. Such risks include crop loss or damage caused by

weather, hail, drought, frost damage, insects, or disease, for instance."

Earthquake insurance is a form of property insurance that pays the policyholder

in the event of an earthquake that causes damage to the property. Most ordinary

homeowners insurance policies do not cover earthquake damage. Most earthquake

insurance policies feature a high deductible. Rates depend on location and the probability

of an earthquake, as well as the construction of the home.

A fidelity bond is a form of casualty insurance that covers policyholders for losses

that they incur as a result of fraudulent acts by specified individuals. It usually insures a

business for losses caused by the dishonest acts of its employees.

Flood insurance protects against property loss due to flooding. Many insurers in

the U.S. do not provide flood insurance in some portions of the country. In response to

23
this, the federal government created the National Flood Insurance Program which serves

as the insurer of last resort.

Landlord insurance is specifically designed for people who own properties which

they rent out. Most house insurance cover in the U.K will not be valid if the property is

rented out therefore landlords must take out this specialist form of home insurance.

Marine insurance and marine cargo insurance cover the loss or damage of ships

at sea or on inland waterways, and of the cargo that may be on them. When the owner of

the cargo and the carrier are separate corporations, marine cargo insurance typically

compensates the owner of cargo for losses sustained from fire, shipwreck, etc., but

excludes losses that can be recovered from the carrier or the carrier's insurance. Many

marine insurance underwriters will include "time element" coverage in such policies,

which extends the indemnity to cover loss of profit and other business expenses

attributable to the delay caused by a covered loss.

Surety bond insurance is a three party insurance guaranteeing the performance

of the principal.

9. LIABILITY INSURANCE

It is a very broad superset that covers legal claims against the insured. Many types

of insurance include an aspect of liability coverage. For example, a homeowner's

insurance policy will normally include liability coverage which protects the insured in the

event of a claim brought by someone who slips and falls on the property; automobile

insurance also includes an aspect of liability insurance that indemnifies against the harm

that a crashing car can cause to others' lives, health, or property. The protection offered

by a liability insurance policy is twofold: a legal defense in the event of a lawsuit

24
commenced against the policyholder and indemnification (payment on behalf of the

insured) with respect to a settlement or court verdict. Liability policies typically cover

only the negligence of the insured, and will not apply to results of wilful or intentional

acts by the insured.

Directors and officers liability insurance protects an organization (usually a

corporation) from costs associated with litigation resulting from mistakes made by

directors and officers for which they are liable. In the industry, it is usually called "D&O"

for short.

Environmental liability insurance protects the insured from bodily injury,

property damage and cleanup costs as a result of the dispersal, release or escape of

pollutants.

Prize indemnity insurance protects the insured from giving away a large prize at

a specific event. Examples would include offering prizes to contestants who can make a

half-court shot at a basketball game, or a hole-in-one at a golf tournament. Professional

liability insurance, also called professional indemnity insurance, protects insured

professionals such as architectural corporation and medical practice against potential

negligence claims made by their patients/clients. Professional liability insurance may take

on different names depending on the profession. For example, professional liability

insurance in reference to the medical profession may be called malpractice insurance.

Notaries public may take out errors and omissions insurance (E&O). Other potential

E&O policyholders include, for example, real estate brokers, Insurance agents, home

inspectors, appraisers, and website developers.

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 Credit insurance: It repays some or all of a loan when certain things happen to

the borrower such as unemployment, disability, or death.

Mortgage insurance insures the lender against default by the borrower. Mortgage

insurance is a form of credit insurance, although the name credit insurance more often is

used to refer to policies that cover other kinds of debt.

10. Other Types

Collateral protection insurance or CPI insures property (primarily vehicles) held

as collateral for loans made by lending institutions.

Defense Base Act Workers' compensation or DBA Insurance provides coverage

for civilian workers hired by the government to perform contracts outside the U.S. and

Canada. DBA is required for all U.S. citizens, U.S. residents, U.S. Green Card holders,

and all employees or subcontractors hired on overseas government contracts. Depending

on the country, Foreign Nationals must also be covered under DBA. This coverage

typically includes expenses related to medical treatment and loss of wages, as well as

disability and death benefits.

Expatriate insurance provides individuals and organizations operating outside of

their home country with protection for automobiles, property, health, liability and

business pursuits.

Financial loss insurance protects individuals and companies against various

financial risks. For example, a business might purchase coverage to protect it from loss of

sales if a fire in a factory prevented it from carrying out its business for a time. Insurance

might also cover the failure of a creditor to pay money it owes to the insured. This type of

insurance is frequently referred to as "business interruption insurance." Fidelity bonds

26
and surety bonds are included in this category, although these products provide a benefit

to a third party (the "obligee") in the event the insured party (usually referred to as the

"obligor") fails to perform its obligations under a contract with the obligee.

Locked funds insurance is a little-known hybrid insurance policy jointly issued

by governments and banks. It is used to protect public funds from tamper by

unauthorized parties. In special cases, a government may authorize its use in protecting

semi-private funds which are liable to tamper. The terms of this type of insurance are

usually very strict. Therefore it is used only in extreme cases where maximum security of

funds is required.

Nuclear incident insurance covers damages resulting from an incident involving

radioactive materials and is generally arranged at the national level.

Pet insurance insures pets against accidents and illnesses - some companies cover

routine/wellness care and burial, as well.

Pollution Insurance, which consists of first-party coverage for contamination of

insured property either by external or on-site sources. Coverage for liability to third

parties arising from contamination of air, water, or land due to the sudden and accidental

release of hazardous materials from the insured site. The policy usually covers the costs

of cleanup and may include coverage for releases from underground storage tanks.

Intentional acts are specifically excluded.

Purchase insurance is aimed at providing protection on the products people

purchase. It can cover individual purchase protection, warranties, guarantees, care plans

and even mobile phone insurance. Such insurance is normally very limited in the scope of

problems that are covered by the policy.

27
 Title insurance provides a guarantee that title to real property is vested in the

purchaser and/or mortgagee, free and clear of liens or encumbrances. It is usually issued

in conjunction with a search of the public records performed at the time of a real estate

transaction.

Travel insurance is an insurance cover taken by those who travel abroad, which

covers certain losses such as medical expenses, loss of personal belongings, travel delay,

personal liabilities, etc.

INSURANCE COMPANIES

Insurance companies may be classified into two groups:

 Life insurance companies which sell life insurance, annuities and pensions

products.

 Non-life, General, or Property/Casualty insurance companies, which sell other

types of insurance.

General insurance companies can be further divided into these sub categories.

 Standard Lines

 Excess Lines

In most countries, life and non-life insurers are subject to different regulatory

regimes and different tax and accounting rules. The main reason for the distinction

between the two types of company is that life, annuity, and pension business is very long-

term in nature- coverage for life assurance or a pension can cover risks over many

decades. By contrast, non-life insurance cover usually covers a shorter period, such as

one year.

28
 In the United States, standard line insurance companies are "mainstream"

insurers. These are the companies that typically insure autos, homes or businesses. They

use pattern or "cookie-cutter" policies without variation from one person to the next.

They usually have lower premiums than excess lines and can sell directly to individuals.

They are regulated by state laws that can restrict the amount they can charge for

insurance policies.

Excess line insurance companies typically insure risks not covered by the

standard lines market. They are broadly referred as being all insurance placed with non-

admitted insurers. Non-admitted insurers are not licensed in the states where the risks are

located. These companies have more flexibility and can react faster than standard

insurance companies because they are not required to file rates and forms as the

"admitted" carriers do. However, they still have substantial regulatory requirements

placed upon them. State laws generally require insurance placed with surplus line agents

and brokers not to be available through standard licensed insurers.

Reinsurance companies are insurance companies that sell policies to other

insurance companies, allowing them to reduce their risks and protect themselves from

very large losses. The reinsurance market is dominated by a few very large companies,

with huge reserves. A reinsurer may also be a direct writer of insurance risks as well.

Captive insurance companies may be defined as limited-purpose insurance

companies established with the specific objective of financing risks emanating from their

parent group or groups. This definition can sometimes be extended to include some of the

risks of the parent company's customers. In short, it is an in-house self-insurance vehicle.

Captives may take the form of a "pure" entity (which is a 100% subsidiary of the self-

29
insured parent company); of a "mutual" captive (which insures the collective risks of

members of an industry); and of an "association" captive (which self-insures individual

risks of the members of a professional, commercial or industrial association). Captives

represent commercial, economic and tax advantages to their sponsors because of the

reductions in costs they help create and for the ease of insurance risk management and

the flexibility for cash flows they generate. Additionally, they may provide coverage of

risks which is neither available nor offered in the traditional insurance market at

reasonable prices.

The types of risk that a captive can underwrite for their parents include property

damage, public and product liability, professional indemnity, employee benefits,

employers' liability, motor and medical aid expenses. The captive's exposure to such risks

may be limited by the use of reinsurance.

Captives are becoming an increasingly important component of the risk

management and risk financing strategy of their parent. This can be understood against

the following background:

 heavy and increasing premium costs in almost every line of coverage;

 difficulties in insuring certain types of fortuitous risk;

 differential coverage standards in various parts of the world;

 rating structures which reflect market trends rather than individual loss

experience;

 Insufficient credit for deductibles and/or loss control efforts.

There are also companies known as 'insurance consultants'. Like a mortgage

broker, these companies are paid a fee by the customer to shop around for the best

30
insurance policy amongst many companies. Similar to an insurance consultant, an

'insurance broker' also shops around for the best insurance policy amongst many

companies. However, with insurance brokers, the fee is usually paid in the form of

commission from the insurer that is selected rather than directly from the client.

Neither insurance consultants nor insurance brokers are insurance companies and

no risks are transferred to them in insurance transactions. Third party administrators are

companies that perform underwriting and sometimes claim handling services for

insurance companies. These companies often have special expertise that the insurance

companies do not have.

The financial stability and strength of an insurance company should be a major

consideration when buying an insurance contract. An insurance premium paid currently

provides coverage for losses that might arise many years in the future. For that reason,

the viability of the insurance carrier is very important. In recent years, a number of

insurance companies have become insolvent, leaving their policyholders with no

coverage (or coverage only from a government-backed insurance pool or other

arrangement with less attractive payouts for losses). A number of independent rating

agencies, such as Best’s, Fitch, Standard & Poor’s, and Moody’s Investors Service,

provide information and rate the financial viability of insurance companies.

31
 CHAPTER 3: COMPANY
PROFILE

32
 CHAPTER 3: COMPANY’S PROFILE

ABOUT RELIGARE

Religare Enterprises Limited (REL), is one of the leading integrated financial

services groups of India. REL’s businesses are broadly clubbed across three key verticals,

the Retail, Institutional and Wealth spectrums, catering to a diverse and wide base of

clients.

The vision is to build Religare as a globally trusted brand in the financial services

domain and present it as the ‘Investment Gateway of India’. All employees of the group

guided by an experienced and professional management team are committed to providing

financial care, backed by the core values of diligence and transparency.

REL offers a multitude of investment options and a diverse bouquet of financial

services with its pan India reach in more than 1550 locations across more than 460 cities

and towns. REL also currently operates from 10 countries globally following its

acquisition of London’s oldest brokerage and investment firm, Hichens, Harrison & Co.

plc.

With a view to expand, diversify and introduce offerings benchmarked against

global best practices, Religare operates its Life Insurance business in partnership with the

global major- Aegon. For its wealth management business, Religare has partnered with

Australia based financial services major- Macquarie. Religare has also partnered with

33
Vistaar Entertainment to launch India’s first SEBI approved Film Fund offering a unique

alternative asset class of investments.

VISION

To build Religare as a globally trusted brand in the financial services domain and

present it as the ‘Investment Gateway of India'.

MISSION

Providing complete financial care driven by the core values of diligence and

transparency.

BRAND ESSENCE

Core brand essence is Diligence and Religare is driven by ethical and dynamic

processes for wealth creation.

34
JOINT VENTURES

AEGON Religare Life Insurance Company

Life Insurance business (AEGON as a partner)

Religare Macquarie Wealth Management Ltd.

Private Wealth business (Macquarie, Australian

Financial Services major as a partner)

Vistaar Religare -The Film Fund

India's first SEBI approved Film Fund (Vistaar as a

partner)

OTHER GROUP COMPANIES

Fortis Healthcare Limited, established in 1996 was

founded on the vision of creating an integrated healthcare

delivery system. With 22 hospitals in India, including

multi-specialty & super specialty centres, the management

is aggressively working towards taking this number to a

significant level in the next few years to provide quality

35
 healthcare facilities and services across the nation.
Religare Wellness Limited (formerly Fortis

Healthworld) is one of the leading players in the wellness

retail space with a footprint of over 100 stores across

India. The group envisages setting up a pan India world

class retail network of wellness stores that would provide

comprehensive solutions under one roof.

Religare Technova Limited is the holding company for

global IT business of the promoter group, offering

Enterprise IT Solutions, Knowledge Management

Solutions and software products and services. Currently

with over 1500 employees and presence in over 10

countries, Religare Technova is poised to be a leader in

the global IT space.

36
About RIBL (Religare Insurance Broking Ltd.)

Religare Insurance Broking Limited (RIBL), a Religare Enterprises Limited

venture is one of India's leading insurance broking firms, with one of the largest retail

networks in the country. The company holds a composite broker's license operating in the

Life, General and Reinsurance domains.

RIBL not only provides customized solutions to individual clients but also to

some of the leading corporate houses and institutions across the country.

RIBL team across the country is driven by the core philosophy of creating and

delivering value to its customers. Our strengths are a team of passionate professionals, a

robust IT infrastructure and strong risk analysis teams adept at identifying & analyzing

your risks and providing you with tailor made solutions.

37
Value Proposition
Presence Pan India foot print
Strong Domain Expertise Rich domain knowledge and Industry experts
Comprehensive Risk Portfolio Expertise to meet all your Insurance needs

Management
Flexibility Market understanding, proactive and customer

centric
Stability Part of a large diversified Indian trans-national

group with presence in over 1550 locations across

more than 460 cities & towns in India and

globally across 10 countries.

Infrastructure Human, technical, physical presence, CRM
Quality Best business practices and highest quality service
Strategic Partnerships Alliance with global and national players to get

you the best deals

38
 THEIR SERVICE OFFERINGS

ABOUT LIC

The Life Insurance Corporation of India (LIC) is the largest life insurance

company in India and also the country's largest investor. It is fully owned by the

government of India. It also funds close to 24.6% of the Indian Government's expenses. It

was founded in 1956.

39
 Headquartered in Mumbai, which is considered the financial capital of India, the

Life Insurance Corporation of India currently has 8 zonal Offices and 101 divisional

offices located in different parts of India, at least 2048 branches located in different cities

and towns of India along with satellite Offices attached to about some 50 Branches, and

has a network of around one million and 200 thousand agents for soliciting life insurance

business from the public

History

The Oriental Life Insurance Company, the first corporate entity in India offering

life insurance coverage, was established in Calcutta in 1818 by Bipin Behari Dasgupta

and others. Europeans in India were its primary target market, and it charged Indians

heftier premiums. The Bombay Mutual Life Assurance Society, formed in 1870, was the

first native insurance provider. Other insurance companies established in the pre-

independence era included

 Bharat Insurance Company (1896)

 United India (1906)

 National Indian (1906)

 National Insurance (1906)

 Co-operative Assurance (1906)

 Hindustan Co-operatives (1907)

 Indian Mercantile

 General Assurance

 Swadeshi Life (later Bombay Life)

40
 The LIFE INSURANCE Act and the Provident Fund Act were passed in 1912,

providing the first regulatory mechanisms in the Life Insurance industry. The Indian

Insurance Companies Act of 1928 authorized the government to obtain statistical

information from companies operating in both life and non-life insurance areas. The

subsequent Insurance Act of 1938 brought stricter state control over an industry that had

seen several financially unsound ventures fail. A bill was also introduced in the

Legislative Assembly in 1944 to nationalize the insurance industry.

Nationalization

In 1955, parliamentarian Feroze Gandhi raised the matter of insurance fraud by

owners of private insurance companies. In the ensuing investigations, one of India's

wealthiest businessmen, Ram Kishan Dalmia, owner of the Times of India newspaper,

was sent to prison for two years. Eventually, the Parliament of India passed the Life

Insurance of India Act on 19/06/1956, and the Life Insurance Corporation of India was

created on 01/09/1956, by consolidating the life insurance business of 245 private life

insurers and other entities offering life insurance services. Nationalization of the life

insurance business in India was a result of the Industrial Policy Resolution of 1956,

which had created a policy framework for extending state control over at least seventeen

sectors of the economy, including the life insurance. The company began operations with

5 zonal offices, 33 divisional offices and 212 branch offices.

Current status

Over its existence of around 50 years, Life Insurance Corporation of India, which

commanded a monopoly of soliciting and selling life insurance in India, created huge

surpluses, and contributed around 7 % of India's GDP in 2006.

41
 The Corporation, which started its business with around 300 offices, 5.6 million

policies and a corpus of INR 459 million, has grown to 25000 servicing around 180

million policies and a corpus of over INR 3.4 trillion.

The organization now comprises 2048 branches, 105divisional offices and 8 zonal

offices, and employs over 1 million agents. It also operates in 12 other countries,

primarily to cater to the needs of Non Resident Indians.

With the change in the India's economic philosophy from the early 1990s, and the

subsequent relaxation of state control over several sectors of the economy, the

monopolistic position of the Life Insurance Corporation of India was diluted, and it has

had to compete with a number of other corporate entities, Indian as well as transnational

Life Insurance brands. However, it still manages to be the largest player in the Indian

market, with the lion's share of 55%.

The recent Economic Times Brand Equity Survey rated LIC as the No. 1 Service

Brand of the Country.

In the financial year 2007-08 Life Insurance Corporation of India's number of

policy holders are said to have crossed a whopping 200 million (fourth in terms of

population of the countries of the world)

Subsidiaries

LIC owns the following subsidiaries:

 Life Insurance Corporation of India International

This is a joint venture offshore company promoted by LIC which commenced

operations in July, 1989 with the objectives of offering US$ denomimated policies to

42
cater to the insurance needs of NRI’s and providing insurance services to holders of LIC

policies currently residing in the Gulf. LIC International operates in all GCC countries.

 LIC Nepal

A joint venture company formed in 2001 with the Vishal Group of Industries, Nepal.

 LIC Lanka

A joint venture company formed in 2003 with the Bartleet Group of Companies, Sri

Lanka.

 LIC Housing Finance

Incorporated in 19 June 1989, its main objective is to provide long term finance for

construction or purchase of houses or apartments. It has a Dubai office.

 LICHFL Care Homes

A wholly owned subsidiary of LIC Housing Finance, it builds and operates "Assisted

Community Living Centres" for senior citizens.

People

LIC is one of the largest employers in India. The organization is headed by 4

officers, namely the Chairman and three Managing Directors. The top brass is appointed

by the Government of India after an intensive selection procedure. Though the company

was accused to go by mere seniority in number of years for the selection of the senior

management, this has changed as seen in the case of Thomas Mathew and A. Dasgupta

(Managing Directors).

The Chairman assumes authority of the CEO and chairs the board while the

Managing Directors are allotted the three main categories of the organization's

functioning.

43
 The current Chairman, Mr. T.S. Vijayan, is particularly responsible for the major

IT infrastructure turnaround that the organization has witnessed and for its

advanced EDMS structure.

D.K. Mehrotra manages the Marketing Units of LIC, which also happens to be

one of the largest spenders on advertising in India.

Thomas Mathew manages the close to $187 billion investment portfolio of the

company, which is the largest investor in the country.

Dasgupta manages the engineering and other functions, many of which are very

advanced in the Indian corporate scenario.

44
LIFE INSURANCE COMPANIES (PRIVATE)

S. Insurers Foreign partners Year of

No. Operation
1 HDFC Standard Life Insurance Co. Standard Life Assurance, 2000-01
Ltd. UK
2 Max New York Life Insurance Co. New York Life, USA 2000-01
Ltd.
3 ICICI Prudential Life Insurance Co. Prudential, UK 2000-01
Ltd.
4 Om Kotak Life Insurance Co. Ltd. Old Mutual, South Africa 2001-02
5 Birla Sun Life Insurance Co. Ltd. Sun Life, Canada 2000-01
6 Tata-AIG Life Insurance Co. Ltd. American International 2000-01
Assurance Co.
7 SBI Life Insurance Co. Ltd. BNP Paribas Assurance SA, 2001-02
France
8 ING Vysya Life Insurance Co. Ltd. ING Insurance International, 2001-02
B.V., Netherlands
9 Allianz Bajaj Life Insurance Co. Ltd. Allianz, Germany 2001-02
10 Metlife India Insurance Co. Ltd. Metlife International 2001-02
Holdings Ltd., USA
11 Reliance Life Insurance Co. Ltd. 2001-02
12 AVIVA AVIVA International 2002-03
Holdings Ltd., UK
13 Sahara Life Insurance Co.Ltd. 2004-05
14 Shriram Life Insurance Co. Ltd. Sanlam, South Africa 2005-06
15 Bharti AXA Life Insurance Co. Ltd. AXA Holdings, France 2006-07
16 Future Generali India Life Insurance
Pantaloon Retail Ltd; Sain 2007-08
Company Ltd. Marketing Network Pvt.
Ltd.; Generali, Italy
17 IDBI Fortis Life Insurance Company Fortis, Netherlands 2007-08
Ltd.
18 Canara HSBC OBC Life Insurance HSBC, UK 2008-09
Company Ltd.
19 DLF Pramerica Life Insurance Co. Prudential of America 2008-09
Ltd.
20 Aegon Religare Life Insurance Religare, Netherlands 2008-09
Company Ltd.

45
 CHAPTER 4: OBJECTIVES OF
THE STUDY

46
 CHAPTER 4: OBJECTIVES OF THE STUDY

The study aims:

a. To understand a closer perspective of insurance and its concepts.

b. To study various insurance companies (their history, their advertising budgets

etc.)

c. To understand customer perception regarding their preference towards LIC or

private insurance companies.

47
 CHAPTER 5: RESEARCH
METHODOLOGY

48
 Chapter 5: RESEARCH METHODOLOGY

The study would be carried out in two parts:

a. Secondary data would be preferred to study the companies for their

advertising budgets, penetration in the market etc.

b. Primary data would be preferred to study the customer perception from which

the conclusions would be drawn thereof.

Secondary data is the data that already exists which has been collected by some

other person or organization for their use, and is generally made available to other

researchers free or at a concessional rate. In this study it would include books,

government publications, directories, internet, hard copy etc.

Primary data is collected directly from respondents using data collection methods.

Here in this study the data collection method which would be used is questionnaires. A

questionnaire has been developed which would help to identify customer preference

towards LIC or private insurers. The questionnaire includes open and closed ended

questions; also likert attitude scale of measurement has been used to measure the

customer preference. The customers are also being asked to rank some of the insurance

companies.

Before deciding on to collect the primary data there is a need to select a sample

for conducting the study. The sample would consist of 75 individuals of Dehradun

(simple random sample).

49
 CHAPTER 6: FINDINGS AND
ANALYSIS

50
 CHAPTER6: FINDINGS AND ANALYSIS

PRIVATE INSURERS VS. LIC

Trends in insurance business

After opening of the insurance sector, unit linked insurance policies (ULIPs) have

become increasingly popular. Below is the growth pattern of unit linked and non linked

business.

Unit Linked Business (%)

Private LIC Idustry

100
88.75 90.33
90
82.3
80
70.3
70
62.31
60 56.91

50 46.31
41.77
40
29.76
30

20
10

0
2007-08 2008-09 2009-10

51
 Non Linked Business (%)

Private LIC Industry

80
70.24
70

60 58.23
53.69
50
43.09
40 37.69

29.7
30

20 17.7
11.25 9.67
10

0
2007-08 2008-09 2009-10

As reflected in the bar a diagram above it is the unit linked business which is

driving the growth of premiums over the last 2-3 years. While the private players have

taken the lead in this segment, LIC has also made strong strides in the sale of ULIPs

during the last three years.

52
Performance in the first quarter 2009-10

Life insurance: The life insurers underwrote a premium of Rs.14320.20 crore

during the first quarter in the current financial year as against Rs. 12511.80 crore in the

comparable period of last year recording a growth of14.45 per cent. Of the total premium

underwritten, LIC accounted for Rs.7524.56 crore and the private insurers accounted for

Rs. 6795.64 crore. The premium underwritten by LIC declined by 12.31 per cent while,

that of private insurers increased by 72.88 per cent, over the corresponding period in the

previous year. The number of policies written at the industry level declined by 7.78 per

cent. While the number of policies written by LIC declined by 23.36 per cent, in the case

of private insurers they grew by 44.00 per cent. Of the total premium underwritten,

individual business accounted for Rs. 10995.90 crore and group business for Rs. 3324.30

crore. In respect of LIC, individual business was Rs. 5275.71 crore and group business

was Rs. 2248.85 crore. In the case of private insurers, they were Rs. 5720.19 crore and

Rs. 1075.45 crore respectively. The market share of LIC was 52.55 per cent in the total

premium collection and 63.88 per cent in number of policies underwritten, lower than

68.58 per cent and 76.87 per cent respectively, reported in the previous year. Under the

group scheme 56.13 lakh lives were covered recording a growth of 8.51 per cent over the

previous period. Of the total lives covered under the group scheme, LIC accounted for

38.96 lakh and private insurers 12.77 lakh. The life insurers covered 12.50 lakh lives in

the social sector with a premium of Rs17.10 crore and underwrote 13.53 lakh policies

with a premium of Rs. 1275.78 crore in the rural sector.

Non-Life Insurers: During the first quarter of the current financial year, the non-

life insurers underwrote a premium of Rs. 8778.18 crore recording a growth of 17.85 per

53
cent over Rs. 7448.74 crore underwritten in the same period of last year. The private non-

life insurers witnessed higher growth of 22.43 per cent by underwriting premium to the

tune of Rs. 3541.78 crore as against Rs. 2892.89 crore underwritten in the same quarter

of the last year. The public non-life insurers underwrote a premium of Rs. 5236.40 crore,

higher by 14.94 per cent in the first quarter of 2007-08. The market shares of public and

private insurer were 59.65 and 40.35 per cent respectively. ECGC underwrote credit

insurance of Rs. 164.70 crore as against Rs. 88.09 crore in the previous year resulting in a

significant growth of 86.98 per cent.

Segment-wise, the premium underwritten in the Fire, Marine, Motor, Health and

Miscellaneous segments by the non-life insurers were Rs. 1208.15 crore, Rs. 572.99

crore, Rs. 3624.23 crore, Rs. 1772.57 crore and Rs 1600.24 crore respectively. The

Health segment recorded the highest growth (49.67 per cent) in the first quarter of the

current financial year over the corresponding quarter of 2007-08. The Fire segment

witnessed negative growth (-13.80 per cent) over in the same period. ln terms of number

of policies, Fire and Marine, recorded negative growth rates (-5.14 per cent and -4.37 per

cent respectively) over the one year period. In the Motor segment, the public insurers

witnessed positive growth rate (23.09 per cent) in the premium underwritten despite

issuing lesser number of policies. The premium underwritten in the Motor segment in the

first quarter of the current financial year was Rs. 3624.23, constituting 41.29 per cent in

the total premium underwritten. The contribution from the Public and Private life insurer

in the Motor premium was Rs. 2151.19 crore (59.36 per cent) and Rs. 1473.04 crore

(40.64 per cent) respectively.

54
 The premium collection in the Health segment went up to Rs. 1772.57 in the first

quarter of the current year, constituting for 20.19 per cent in the total premium. The

number of policies, issued in this quarter, as a ratio of total number of policies worked

out to 12.20 per cent. The shares of public and private non-life insurers in the Health

segment remained similar to the Motor segment, which constituted 58.72 per cent

(Public) and 41.28 per cent (Private) respectively in the first quarter of the current

financial year. In terms of number of policies issued Health segment recorded a growth of

12.95 per cent. This growth was sharper in the public insurers with 20 per cent.

PAID UP CAPITAL

The total capital of the life insurers at end March 2008 stood at Rs. 12296.42

crore. The additional capital brought in by the existing private insurers during 2008-09

was Rs. 3787.01 crore and the two new entrants, brought in equity of Rs. 385 crore

making the total additional capital brought in 2008-09 by the private insurers to Rs.

4172.01 crore. Of this, the domestic and the foreign joint venture partners added Rs.

3160.12 crore and Rs. 1011.88 crore respectively.

PAID UP CAPITAL: LIFE INSURERS (Rs. Crore)

Insurer March 31, 2007 Additions during March 31, 2008

2008-09
LIC 5.00 0.00 5.00
Private Sector 8119.41 4172.01 12291.42
Total 8124.41 4172.01 12296.42

There has been no infusion of capital in the case of LIC which stood at Rs.5 crore.

55
NUMBER OF OFFICES

By the end of March 2008, there were eighteen life insurance companies

operating in India. Subsequently, Aegon Religare Life Insurance Company Ltd., Canara

HSBC Oriental Bank of Commerce Life Insurance Co. Ltd., DLF Pramerica Life

Insurance Company Ltd. was given Certificate of Registration by the Authority. With

these two new companies the total number of life insurance companies operating in India

rose to 21.

The number of offices of the life insurers has increased dramatically in the year

2007-08 from 5373 at the beginning of the year to 8913 by the end of the year, showing a

growth of over 65 per cent. A major portion of this expansion was in the private sector

whose offices more than doubled from 3072 to 6391. LIC’s offices increased at a more

modest 10 per cent from 2301 offices to 2522.

LIFE INSURANCE OFFICES (AS ON MARCH 31, 2009)

Insurer 2002 2003 2004 2005 2006 2007 2008 2009

Private 13 116 254 416 804 1645 3072 6391
LIC 2186 2190 2191 2196 2197 2220 2301 2522
Industry 2199 2306 2445 2612 3001 3865 5373 8913

Total

Note: Office as defined under Section 64 VC of the insurance Act, 1938

Significantly, the number of offices of private life insurers in semi-urban and

smaller locations put together increased the highest, by over 140 per cent, from 1908 to

4592 in 2007-08.

DISTRIBUTION OF OFFICES OF LIFE INSURERS AS ON MARCH 31, 2009

56
 Insurer Metro Urban Semi-urban Others Total
Private 628 1169 2692 1902 6391
LIC 311 468 848 895 2522
Industry 939 1637 3540 2797 8913

Total

Note: Based on HRA classification of places done by Ministry of Finance.

Metro: Delhi, Mumbai, Chennai, Kolkata, Hyderabad and Bangalore

Urban: A, B-1 and B-2 class cities of the HRA classification

Semi-urban: C class cities of the HRA classification

Others: Places not listed in the HRA classification

New Policies

New policies underwritten by the industry were 508.74 lakh in 2007-08 as against

461.52 lakh during 2006-07 showing an increase of 10.23 per cent. While the private

insurers exhibited a growth of 67.40 per cent, (previous year 104.64 per cent), LIC

showed a decline of 1.61 per cent as against a growth of 21.01 per cent in 2006-07.

NEW POLICIES ISSUED: LIFE INSURERS

Insurer 2007-08 2008-09

LIC 38229292 (21.01) 37612599 (-1.61)
Private Sector 7922274 (104.64) 13261558 (67.40)
Total 46151566 50874157

Note: Figure in brackets indicate growth rate (in per cent)

The market shares of private insurers and LIC, in terms of number of policies

underwritten, were 26.07 per cent and 73.93 per cent as against 17.17 per cent and 82.83

per cent respectively in 2007-08.

PREMIUM

57
 Life insurance industry recorded a premium income of Rs. 201351.41 crore

during 2007-08 as against Rs. 156075.85 crore in the previous financial year, recording a

growth of 29.01 per cent. Regular premium, single premium, renewal premium in 2007-

08 were Rs. 54888.16 crore (27.26 per cent); Rs. 38824.36 crore (19.28 per cent); and Rs.

107638.89 crore (153.46 per cent), respectively. The first year premium (comprising of

single premium and regular premium) amounted to Rs. 93712.52 in 2007-08 as against

Rs. 75649.21 crore in 2007-08 recording a growth of 23.88 per cent as against a growth

of 94.96 per cent in 2007-08. The first year premium growth in 2008-09 over a higher

growth in 2007-08 has been on account of continued popularity of unit linked products. It

is observed that LIC too has shifted its marketing strategy in favour of unit linked

products since 2007-08 though LIC’s performance has slowed down in 2008-09. While at

the industry level, there has been a growth because of slow down in the premium

underwritten by LIC the growth levels in 2008-09 were lower than 2007-08. LIC reported

growth of 24.17 per cent in single premium individual policies and decline of 6.48 per

cent in non-single premium individual policies. LIC reported a growth of 9.11 per cent in

Group Single Premium. As against these, private insurance companies reported growth of

39.45 per cent and 69.93 per cent in individual single and non-single policies

respectively. The growth in the number of policies underwritten in the Group Single and

Non- single segments by the private insurers stood at 54 and 1 per cent respectively. A

shift in the shares of first year premium and renewal premium to the total premium was

observed in 2008-09. In 2008-09 renewal premium accounted for 53.46 per cent of the

total premium underwritten slightly higher than 51.53 per cent in 2007-08.

PREMIUM UNDERWRITTEN BY LIFE INSURERS (Rs. crore)

58
 Insurer 2007-08 2008-09
Regular Premium
LIC 29886.35 (117.70) 26222.00 (-12.26)
Private Sector 15474.83 (105.59) 28666.15 (85.84)
Total 45361.17 (113.40) 54888.16 (21.00)
Single Premium
LIC 26337.22 (78.10) 33774.56 (28.24)
Private Sector 3950.82 (44.04) 5049.80 (27.82)
Total 30288.04 (72.60) 38824.36 (28.18)
First Year Premium
LIC 56223.56 (97.17) 59996.57 (6.71)
Private Sector 19425.65 (89.08) 33715.95 (73.56)
Total 75649.21 (94.96) 93712.52 (23.88)
Renewal premium
LIC 71599.28 (14.97) 89793.42 (25.41)
Private Sector 8827.36 (83.37) 17845.47 (102.16)
Total 80426.64 (19.87) 107638.89 (33.83)
Total Premium
LIC 127822.84 (40.79) 149789.99 (17.19)
Private Sector 28253.01 (87.31) 51561.42 (82.50)
Total 156075.86 (47.38) 201351.41 (29.01)

Note: Figure in brackets indicate the growth (in per cent)

Increase in the renewal premium is a good measure of the quality of business

underwritten by the insurers. It reflects increase in persistency ratio and enables insurers

to bring down the overall cost of doing business. The renewal premium underwritten by

the life insurance industry, during 2008-09 grew by 33.83 per cent as against 19.87 per

cent in 2007-08. Private insurers and LIC reported growth rates of 102.16 per cent and

25.41 per cent respectively during the year under review.

MARKET SHARE

The size of life insurance market increased on the strength of growth in the

economy and concomitant increase in per capita income. This resulted in favourable

59
growth in total premium for both LIC (17.19 per cent) and private insurers (82.50 per

cent) in 2008-09. Private insurers have improved their market share from 18.10 per cent

in 2006-07 to 25.61 per cent in 2007-08 in the total premium collected during the year.

Segregation of the first year premium underwritten during 2007-08 indicates that Life,

Annuity, Pension and Health contributed 59.54, 2.75, 37.61 and 0.10 per cent

respectively in the previous year. The shift in favour of pension products is visible for the

third consecutive year.

60
 MARKET SHARE OF LIFE INSURERS (Per cent)

Insurer 2007-08 2008-09

Regular Premium
LIC 65.89 47.77
Private Sector 34.11 52.23
Total 100.00 100.00
Single Premium
LIC 86.96 86.99
Private Sector 13.04 13.01
Total 100.00 100.00
First Year Premium
LIC 74.32 64.02
Private Sector 25.68 35.98
Total 100.00 100.00
Renewal Premium
LIC 89.02 83.42
Private Sector 10.98 16.58
Total 100.00 100.00
Total Premium
LIC 81.90 74.39
Private Sector 18.10 25.61
Total 100.00 100.00

61
62
63
EXPENSES

As against the industry average of 16.25 per cent (16.59 per cent in 2007-08), LIC

incurred an expense ratio of 17.01 per cent (16.03 per cent in 2007-08) towards

commission on first year premium (excluding Single Premium). For the private insurers

this ratio worked out to be 15.56 per cent (17.68 per cent in 2007-08). The commissions

paid by LIC towards the single premium was 1.49 per cent as against industry average of

1.43 per cent. The corresponding ratio for private insurers averaged to 1 per cent. The

total commission paid bythe life insurers in 2008-09 amounted to Rs. 14704.3 crore as

against Rs. 12258.99 crore in 2007-08. It was observed that commissions paid by the life

insurance companies for procurement of new business has increased competition in the

sector.

Management expense of private insurers had stabilized in 2007-08. In 2008-09,

six companies namely Bharti AXA, Aviva, ING Vysya, Reliance and new entrants-

Future Generali and IDBI Fortis exceeded the prescribed limits. Out of 18 companies

which underwrote business during 2008-09, 12 companies complied with the stipulations

on expenses of management. However, Bharti AXA which started business in 2007-08

exceeded the prescribed limits in the year 2008-09. In the case of Future Generali, IDBI

Fortis and Bharti AXA, the excess was within the norms for the life insurance industry.

In the case of LIC, the expenses of management continued to be within the allowable

limits.

64
 COMMISSION EXPENSES OF LIFE INSURERS (Rs. crore)

Insurer 2007-08 2008-09

Regular
LIC 4789.74 4459.48
Private Sector 2735.70 4460.49
Total 7525.43 8919.97
Single Premium
LIC 414.05 504.33
Private Sector 42.51 50.65
Total 456.57 554.98
First Year
LIC 5203.79 4963.81
Private Sector 2778.21 4511.15
Total 7982.00 9474.95
Renewal
LIC 3969.79 4650.89
Private 307.19 578.46
Total 4276.99 5229.35
Total
LIC 9173.58 9614.69
Private Sector 3085.40 5089.61
Total 12258.99 14704.3

The major expense heads for the private insurers were employee expenses at

39.08 per cent (37.93 per cent in 2006-07); advertisement and publicity at 8.92 per cent

(8.89 in 2006-07); training expenses (including agents training and seminars) at 5.96 per

cent (6.92 per cent in 2006-07). Employee remuneration and welfare benefits accounted

for 60.75 per cent of the operating expenses of LIC in 2007-08 as against 57.49 per cent

in the previous year.

As the private insurers have leaner organizational structures compared to LIC

their average worked out to be 47.93 per cent as against 48.11 per cent in 2006-07.

Advertisement and publicity expenses of LIC accounted for 2.44 per cent of the total

65
operating expenses (3.03 per cent in 2006-07). Training expenses in the case of LIC

accounted for 1.73 per cent of the operating expenses (1.93 per cent in 2006-07).

OPERATING EXPENSES OF LIFE INSURERS (Rs. crore)

Insurer 2007-08 2008-09

LIC 7085.84 8309.32
Private Sector 6500.01 12032.46
Total 13585.85 20341.78

Operating expenses as a per cent of gross premium underwritten for the private

insurers worked out to 23.34 more or less at the same level as in 2007-08. In the case of

LIC, operating expenses constituted 5.55 per cent of the gross premium underwritten in

2008-09 same as in 2007-08.

BENEFITS PAID

The life industry paid gross benefits of Rs. 61780.02 crore in 2007-08 (Rs.

55765.35 crore in 2006-07)constituting 30.68 per cent of the gross premium underwritten

(35.73 per cent in 2006-07). The benefits paid by the private insurers showed an increase

of 111.28 per cent at Rs. 5212.24 crore (Rs. 2466.94 crore in 2006-07), constituting 10.11

per cent of the premium underwritten (8.73 per cent in 2006-07). LIC paid benefits of Rs.

56567.78 crore in 2007-08, constituting 37.76 per cent of the premium underwritten (Rs.

53298.41 crore in 2006-07) constituting 41.70 per cent of the total premium underwritten.

The benefits paid by the life insurers net of re-insurance were Rs. 61687.77 crore (Rs.

55715.01 crore in 2006-07). There has been a significant increase in the benefits paid on

66
account of surrenders/withdrawals amounting to Rs. 21677.25 crore as against Rs.

17690.32 crore in 2006-07.

INVESTMENT INCOME

In the case of LIC, the investment income including capital gains was higher at

Rs. 56595.06 crore in 2008-09 compared to Rs. 46784.71 crore in 2007-08. As a

percentage of total income, it increased to 37.78 per cent in2008-09 from a decline of

36.6 per cent in 2007-08. The investment income of the private insurers, inclusive of

capital gains, was Rs. 6602.62 crore in 2008-09 as against Rs. 2478.48 crore in 2006-07.

The share of investment income in the total income for the private life insurers increased

to 23.37 per cent in 2007-08 (4.81 per cent in 2006-07).

67
PROFITS OF LIFE INSURERS

In 2008-09, four of the private sector companies reported net profits. SBI Life

insurance company was the first private company to report net profit of Rs. 2.02 crore in

2006-07. It reported higher net profit of Rs. 3.83 crore in 2007-08 and further increased

its net profit level to Rs. 34.38 crore in 2007-08. The company has succeeded in

achieving an early break even on account of its lower cost of operations due to the large

network of its Indian partner, the State Bank of India. However, the insurer still continues

to report a deficit in the Revenue Account. Shriram Life, which commenced operations in

February, 2007, too reported net profit for the third successive year of operations.

However, it reported a lower net profit of Rs. 5.58 crore in 2008-09 as against Rs. 9.5

crore in 2007-08. With the total premium underwritten at Rs. 184.16 crore, the

company’s operations have, however still to take off in a significant manner. In 2008-09,

Metlife and Sahara life have reported net profits of Rs. 21.25 crore and Rs. 3.34 crore

respectively. As against net loss of Rs. 11.96 crore in 2007-08, Metlife reported net profit

of 21.25 crore in 2008-09. The company has reported profits by carrying deficit of Rs.

488 crore in the revenue account. Sahara Life has reported maiden net profits in 2008-09

at Rs. 3.34 crore, against net loss of Rs. 51.44 lakh in 2007-08.

All the private insurance companies reported deficit in their respective Revenue

Accounts in 2008-09. Some of these companies reported surpluses in some segments of

their business in 2007-08. The deficits in Revenue account necessitated injection of

further capital by the shareholders (except for Shriram Life).

68
RETURNS TO SHAREHOLDERS

During 2008-09, the net losses reported by the private insurers stood at

Rs.4324.52 crore (Rs. 1950.12 crore in 2007-08). The net profits in the Profit & Loss

account of the five insurers, including LIC, stood at Rs. 909.19 crore (Rs. 786.95 crore in

2006-07). The continued financial support through equity injections reflected the

promoters’ commitment towards stabilizing the respective insurer’s operations.

DIVIDEND PAID: LIFE INSURERS (Rs. crore)

Insurer 2007-08 2008-09

LIC 757.81 829.59
Private Sector - -
Total 757.81 829.59

LIC continued to report surplus in the Policyholders’ Account (Revenue Account

in 2007-08). Surplus in the said account, adjusted for interim bonus and allocation of

bonus to policyholders was Rs. 829.59 crore as against Rs. 757.81 crore in 2007-08. LIC

transferred Rs. 829.59 crore to the Government of India (Rs. 757.81 crore in 2007-08)

complying with the provisions of Section 28 of the LIC Act, 1956.

RETENTION RATIO

LIC traditionally re-insures a small component of its business. During 2008-09,

Rs. 87.95 crore was ceded as re-insurance premium (Rs. 41.67 crore in 2006-07).

Similarly, in the case of private insurers, a small component of the business was re-

insured, with group business forming the major component of the re-insurance cessions.

The private insurers together ceded Rs. 231.23 crore (Rs. 160.05 crore in 2007-08) as

premium towards re-insurance.

69
 A sample consisting of 75 respondents was taken randomly. It included

individuals of almost all age groups. These respondents were given a questionnaire to be

filled by them and on the basis of that questionnaire some findings were drawn out.

Below is the percentage of likelihood for various companies based on the perception

in the mind of customer.

Pushkar Lahiri
Chandni Negi LIC
Deepak Singh Negi
Sanjeev Goel MAX New York
Jasbeer Singh Tomar SBI Life
Vibha Gurung
Rachiyata Birla Sun Life
Sunil Malik TATA AIG
Raju Saini
Tarandeep Singh ICICI Prudential
Siddharth Gupta Bharti AXA
Bimal Singh
Sandeep Singh AEGON Religare
Sanjeev Sharma Bajaj Allianz
Vikas Nanda
HDFC Standard Life
0% 20% 40% 60% 80% 100%

Rajeev Jain
Richa B. Ahuja
Amit Kumar Bhatt LIC
Pooja Kapoor
Manju Joshi MAX New York
Rajan Kapoor SBI Life
Rahul Bajaj Birla Sun Life
Sakshita Davey TATA AIG
Amit Kumar
E.K. Ramakrishnan ICICI Prudential
Ankit Jain Bharti AXA
Anil Kumar Joshi AEGON Religare
Pratap Singh Chauhan Bajaj Allianz
Sunil Tomar HDFC Standard Life
Virendra Singh Chauhan
0% 20% 40% 60% 80% 100%

70
 Sumit
Shashi Bhushan Semwal
Jitendra Kumar Bansal
Sandeep Kumar LIC
Tauquir Ali MAX New York
Altaf Mohd. Khan SBI Life
Devendra Kumar Birla Sun Life
Aftab Ahmed TATA AIG
Ajit Kumar
Satish Chandra Kesarwani ICICI Prudential
Aashish Srivastava Bharti AXA
Jai Prakash Gupta AEGON Religare
Pradeep Kesarwani Bajaj Allianz
Nusrat Ali Ansari HDFC Standard Life
Satyapal Singh
0% 20% 40% 60% 80% 100%

Mandeep
Radhey Shyam
Manmohan Singh
Jagdish Singh LIC
Dinesh Katwal MAX New York
Preeti Agarwal SBI Life
Ahuja Bhatt Birla Sun Life
Shahnawaz TATA AIG
Ritesh Kumar
ICICI Prudential
Gulshan Kumar
Bharti AXA
Nand Kishore
AEGON Religare
S.K. Sharma
V.K. Sharma Bajaj Allianz
Gaurav Bhatt HDFC Standard Life
Naveen Singh
0% 20% 40% 60% 80% 100%

71
 Hari Singh
Sandeep Kumar Mishra
Ruchi Malhotra
Abul Khalil LIC
Devendra Singh MAX New York
Anu Goyal SBI Life
Preeti Mittal Birla Sun Life
Moinuddin Mullah TATA AIG
Manav Verma
ICICI Prudential
Sushmita Goel
Bharti AXA
Sandeep Sharma
Rajeev Sharma AEGON Religare
Ashish Mohan Bajaj Allianz
Rakesh Goswami HDFC Standard Life
Kamal Prasad Sharma
0% 20% 40% 60% 80% 100%

Now, based on the perception of the customer about various companies a pie chart

can be drawn out which would show the likeliness/preference of the customer for a

company while choosing his/her insurance policy.

LIC=17.23%
MAX New York=10.95%
SBI Life=11.46%
Birla Sun Life=9.89%
TATA AIG=9.67%
8.63 ICICI Prudential=10.98%
17.23 Bharti AXA=7.24%
10.27 AEGON Religare=3.63%
3.63 Bajaj Allianz=10.27%
10.95
HDFC Standard
7.24 Life=8.63%

11.46
10.98

9.67 9.89

72
 The pie chart clearly indicates that the customers prefer LIC as their insurance

provider followed by SBI Life, ICICI Prudential, MAX New York, Bajaj Allianz, Birla

Sun Life, TATA AIG, HDFC Standard Life, Bharti AXA, and AEGON Religare. The

lowest preference is for Aegon Religare as most of the people do not know much about it.

There might be another reason to it that as Aegon Religare has just entered the insurance

industry most of the customers are not aware of it.

Another dimension mentioned in the questionnaire were the factors that

influence an individual while selecting an insurance policy. These factors were Rate of

Return, Tax Benefit, Flexibility, Services Provided, Risk cover, Charges and Goodwill.

These factors have been reflected in the pie chart below with their respective percentage

based on the perception of the customer.

Rate of return=16.08%
16.9 16.08
Tax Benefit=14.01%

10.91 14.01 Flexibility=10.39%

Services provided=16.28%

Risk cover=15.41%

15.41 10.39 Charges=10.91%

16.28
Goodwill=16.9%

From the pie diagram it may be concluded that most of the people prefer LIC

because of its goodwill (17%). LIC is in the market since several years (1956) and has

created a good position in the minds of the customers. However, as we know that the rate

73
of return offered by LIC in its policies is much lower as compared to the private life

insurers, yet the customers go for LIC as they consider it to be more safe and has less

risk. It is because of the rate of return, services provided, lower charges that the private

insurers are able to snatch a certain portion of market of LIC. The market share of LIC

and Private insurers in 2007-08 was 81.9% and 18.10%, however, because of the

advertisements, higher rate of return, high flexibility, lower charges their market share in

2009-10 increased to 25.61% whereas that of LIC lowered to 74.39%.

Despite the fact that some portion of the market has been overtaken by private

insurers, LIC continues to be a market leader and bears goodwill in the minds of the

customers.

74
 CHAPTER 7: CONCLUSION

75
 CONCLUSION

On the basis of the study it is found that LIC is better service provider than the other

associations because of their timely research and personalized advice on what stocks to buy and

sell. LIC provides the facilities of relationship manager for encouragement and protects the interest

of the investors. It also provides the best satisfaction in their customers mind by the best trustable

organization in the whole country and people are easily agreed to take the services provided by

LIC.

Study also concludes that people are not much aware of commodity market and while

it’s going to be biggest market in India. From the above survey and observation it is found that

most of the people who are trading in share market belongs to the employee group, next comes

the business men, and other class of income people. As the share market value goes on

increasing day by day the investor who wants to invest in shares also increased. Trading in online

trading firm is as easy as it all delivered with internet and within a few minutes the customers can

buy and sell a share which saves time as well as reduction of people work. Hence trading in share

market is increasing day by day and investors are ready to invest their investment in share market

only.

I got the knowledge about the customer’s needs and their references for having

particular products. The need of customers differs from person to person, areas, locality and

occupation. Customers always want more services by paying less.

76
 CHAPTER 8: LIMITATIONS

77
 CHAPTER 8: LIMITATIONS
As fitting to every research As fitting to every research work here also there are

certain limitations to the study which must be mentioned beforehand so that the reader

might perceive it in those regards:-

1. Resources limited: As the study is conducted in individual groups and no

additional help has been provided by the company in terms of financial support

hence the best probable study is conducted in the given small resource pellets.

2. Geographical: The study is relevant only under the geographical inbounds of

Dehradun, i.e. the urban settlements. No rural visits are scheduled for this study.

3. Time constraints: The time required to conduct the research study is a

constraint as we have also to sell insurance policies so conducting the research

alone becomes somewhat hectic.

4. Monetary constraints: As there is no stipend which is provided by the

company, it does not lead to any motivation. This study is totally about meeting

people, which involves moving within the city, which certainly requires money.

5. Errors: There are always some chances of errors creeping in such as non

response errors, biased response errors etc. Some errors might also creep in

during interpretation.

78
 CHAPTER 9:
RECOMMENDATIONS

79
 CHAPTER 9: RECOMMENDATIONS
As we are undergoing training in Religare, it becomes important for us to

recommend something good for the company itself. Religare entered the insurance

industry in 2008-09 with global major Aegon as its partner. However, with Aegon as its

partner it has failed to enhance its image in the eyes of the customer. Most of the people

still do not know about the company. The company’s management hasn’t made efforts to

build the company’s image.

The people of Dehradun were astonished to hear that Aegon Religare is an

insurance company. The results shown above prove this statement. As mentioned above,

simple random sampling was done and 75 respondents perspective was collected. On the

basis of that perspective Aegon Religare has 3.63% share in the minds of the customers.

This clearly shows the management’s leanness in projecting the company as another

insurance company.

Personal experience: - while the respondents were filling the questionnaire they

were asked as to whether they knew about Aegon Religare and to my astonishment they

responded “WHICH COMPANY IS IT? / IS IT ALSO INSURANCE COMPANY?” It

was such a shame on my side that the company I was working with was never heard of.

So it is strongly recommended on my part that the company should resort to

advertising, launch exciting policies, organize trade fairs, sporting events etc. One thing

that I would like to clarify is that nowadays IPL is going on and to my surprise not a

single ad of Aegon Religare was shown. As we know that when a company is new in the

market it should spend a considerable amount on advertisement to create awareness in the

minds of customers. Not many people know that Irfan Khan is the brand ambassador of

Aegon Religare.

80
 CHAPTER 10: REFERENCES

81
 REFERENCES

Websites

 www.licindia.com

 www.wikipedia.org

 www.icallinsurance.com

 www.bimaonline.com

 www.irdaindia.org

 http://www.religareinsurance.com

 www.censusofindia.org

Books

 Insurance Fundamentals, Environment and Procedures by B S Bodla, M C Garg,

K P Singh.

 Life insurance and General Insurance from ICMR.

Others

 T.S. Ramakrishna Rau, Insurance Chronicle, January 2009

 Endowment plans now, Business India, March 2009

 Niraj Bajaj , ‘insuring a bright future’ ,business India, April2008

 Articles related to insurance from various news papers like The Times of India,

The Hindu, Economic Times, Business Standard etc.

 ICMR books on Financial Management and Business Research Methods.

 IRDA Journal

82