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Executive summary

 Someone has greatly said that practical knowledge is far better than
classroom teaching. During this project I fully realized this and come to
know about the present real world of Insurance sector. It includes all the
activities involved in providing insurance products to the final customers. I
am pleased to know about the consumers’ wants and competitors activities
in the real world of Insurance.

 The subject of my study is to analyze the present insurance sector and


products offered by IDBI Federal insurance company by applying various
tools like cold calling and through direct interaction with customers. I have
also done research on the growth of private life insurance companies in the
last five years.

 The report contains first of all brief introduction about the company. Then it
contains the current status of private insurance companies and foreign
insurance companies in India.

 I also put forward recommendations of the consumers and conclusions that


will help IDBI Federal insurance company to provide consumer satisfactory
services in the insurance sector.
CHAPTER-I

INTRODUCTION

1.1 ABOUT INSURANCE:

 Life is full of risks. Being a social animal and risk reverse, man always tries
to reduce risk. An age-old method of sharing of risk through economic
cooperation led to the development of the concept of “insurance”.
 Insurance may be described as a social device to reduce or eliminate risk of
loss to life and property. Insurance is collective bearing of risk. The risks,
which can be insured against, include fire, perils of sea, death, accidents and
burglary.

 Insurance can be defined as a legal contract between two parties where one
party called insurer undertakes to pay a fixed amount of money on
happening of a particular event which may be certain or uncertain. The other
party called insurer pays in exchange a fixed sum known as `premium. The
insurer and the insured are also known as “Assuror and Assured”.
 Insurance is a social device where uncertain risks of individuals may be
combined in a group and thus made more certain - small periodic
contributions by the individuals provide a found out of which those who
suffer losses may be reimbursed. In addition to being a means to protect
oneself, the insurance Industry is an efficient conduit for the saving of
people to be channeled towards economic growth. In India, the Insurance
Industry7 is more than 150 years old. Today, it is monopolized by two
PSU's in their respective fields of life and General Insurance.
 However, with the successful passage IRDA Bill through both houses of
parliament in December 1999 the sector has been opened up to private
players.
 This will provided much. Needed impetus to the Industry and will improve
the quality of service and products and will also increase employment
opportunities.
 There are still some issues their need to be sorted out, particularly with
regard to the status of intermediaries as envisaged by the Insurance
Regulatory Authority.

1.2 ABOUT COMPANY:

FINAMIGO CONSULTANTS PVT.LTD.

 FINAMIGO Consultants Private Limited is a Private incorporated on 28


September 2018. It is classified as Non-govt. company and is registered at
Registrar of Companies, Delhi. Its authorized share capital is Rs. 1,000,000
and its paid up capital is Rs. 50,000. It is involved in Business activities
n.e.c.
 Finamigo Consultants Private Limited's Annual General Meeting (AGM)
was last held on N/A and as per records from Ministry of Corporate Affairs
(MCA), its balance sheet was last filed on N/A.
 Directors of Finamigo Consultants Private Limited are Chetna Gumber and
Aayushi.
 Finamigo Consultants Private Limited's Corporate Identification Number is
(CIN) U74999DL2018PTC339704 and its registration number is 339704.Its
Email address is info@gargbmohan.com and its registered address is
Ground Floor, House No. 52 Sandesh Vihar Pitampura DELHI North West
DL 110034 IN

Current status of Finamigo Consultants Private Limited is - Active.

 Finamigo is one of India's emerging consulting firm. At finamigo, we


provide wealth management services to high and Ultra high-net-worth
individuals (HNIs & UHNIs).
 Our highly trained and specialized team engage with clients from across the
country as well as those based abroad. In addition to our custom-designed
solutions, we focus on 'un complicating' the entire process of investment for
each client.
 Our focus on building long-term relationships defines our business. Our
advisory backed by a strong product and research team, underscores the
unmatched value of the Finamigo proposition.
 At Finamigo, we cater to financial needs of Individual and corporate clients.

They are mainly working for a India’s first life insurance and focus on their life
insurance product name “India first mahajan plan”

 Our identity as the leading provider of professional wealth advisory in India


and Abroad, AIM India delivers a one stop solution/ service to achieve
financial independence. Our principle is to deliver high returns to our clients
through our network of government sector banks in India.
 Comprehensive wealth management is a high level professional service that
combines financial and investment advice in accounting, taxation services
and retirement planning. Our wealth management is much more than just
investment advice as we encompass all parts of an individual's financial life.
 Coordinate all the services needed to manage client's money and plan for
their own and family's current and future needs. We maintain and increase
their wealth based on individual's financial situation goals and comfort level
with risk.

1.3 ABOUT MY WORK IN FINAMIGO:

I had done my internship in FINAMGO under the two domain:


1. MARKETING DOMAIN

 Under this domain I learned how to sell insurance.


 I arranged meetings with the clients.
 I did cold callings.
 I sold two insurances.
 Made projects.
 Give some presentations.

Product highlights:
MAHAJEEVAN PLAN Product of India first life insurance.
o Higher rate of return
o 16 times life cover
o Loan with no interest charges Tax benefit
o Assignment feature
o Highly secured

2. HR DOMAIN

 Under this domain I learned how to collect data or information.


 Made assignments.
 Collect information of Hyderabad colleges.
 Cold callings.

Apart from these domains, during the learning sessions we will do many
other activities like,
 Money maker activity.
 Cake cutting on birthdays.
 Participated in many contests launching like:
 Get 125% theme.
 I phones distribution
 Certificates
 International or domestic trips.

1.4 Company’s mission and vision:

 Mission
To build a world class business through high quality and honest financial
solutions backed by incisive research and expert team.

 Vision
To increase our market share year on year and maintain the same level of
experience for every client and assure that we become the most valuable
asset for each client.

1.5 SWOT ANALYSIS:

Strengths:

 Highly return
 Highly secured

Weakness:

 Approachability in rural areas


 Less customer awareness
 Promotion as a barrier

Opportunities:

 Growing young insurable population


 Awareness on protection
 Uncovered rural areas

Threats:

 Cuthtroat competition with other companies like LIC.


 Substitutes.
Chapter 2

Introduction about Topic

2.1 Investment needs of an Indian customer:

 Investment is the act of putting money to work to start or expand a business


or project or the purchase of an asset, with the goal of earning income or
capital appreciation.
 Investment is oriented toward future returns, and thus entails some degree of
risk.
 Common forms of investment include financial markets (e.g. stocks and
bonds), credit (e.g. loans or bonds), assets (e.g. commodities or artwork),
and real estate.

 10 reasons of investment needs of an Indian customer:

1.Grow your money

Investing your money can allow you to grow it. Most investment vehicles,
such as stocks, certificates of deposit, or bonds, offer returns on your money
over the long term. This return allows your money to build, creating wealth
over time.

2. Save for retirement

As you are working, you should be saving money for retirement. Put your
retirement savings into a portfolio of investments, such as stocks, bonds, mutual
funds, real estate, businesses, or precious metals. Then, at retirement age, you can
live off funds earned from these investments.
Based on your personal tolerance of risk, you may want to consider being riskier at
a younger age with your investments. Greater risk increases your chances of
earning greater wealth. Becoming more conservative with your investments as you
grow older can be wise, especially as you near retirement age.

3. Earn higher returns

In order to grow your money, you need to put it in a place where it can earn a high
rate of return. The higher the rate of return, the more money you will earn.
Investment vehicles tend to offer the opportunity to earn higher rates of return than
savings accounts. Therefore, if you want the chance to earn a higher return on your
money, you will need to explore investing your money.

4. Reach financial goals

Investing can help you reach big financial goals. If your money is earning a higher
rate of return than a savings account, you will be earning more money both over
the long term and within a faster period. This return on your investments can be
used toward major financial goals, such as buying a home, buying a car, starting
your own business, or putting your children through college.

5. Build on pre-tax dollars

Some investment vehicles, like employer-sponsored 401(k)s, allow you to invest


your pre-tax dollars. This option allows you to save more money than if you could
only invest your post-tax dollars.

6. Qualify for employer-matching programs

Some employers offer to match the money you invest in your 401(k) plan up to a
certain amount. Of course, the only way you can qualify and earn these matching
funds is if you are actively investing in your 401(k) plan. Thus, many people invest
in their 401(k)s to gain the matching employer funds.

7. Start and expand a business

Investing is an important part of business creation and expansion. Many investors


like to support entrepreneurs and contribute to the creation of new jobs and new
products. They enjoy the process of creating and establishing new businesses and
building them into successful entities that can provide them with a strong return on
their investment.

8. Support others

Many investors like investing in people, whether they are business owners, artists,
or manufacturers. These investors feel good helping others achieve their goals.

9. Reduce taxable income

As an investor, you may be able to reduce your taxable income by investing pre-
tax dollars into a retirement fund, like a 401(k). If you generate a loss from an
investment, you may be able to apply that loss against any gains from other
investments, which lowers the amount of your taxable income.

10. Be part of a new venture

New ventures need the backing of money, and they look to investors for that
backing. Some investors may like the excitement of investing in a new, cutting-
edge product or service, or being part of something like a business or film that
introduces them to a glamorous world.
2.2 Investment pattern:

The investment pattern is a long-term perspective and investing one’s hard earned
money is a serious subject that can have a major impact on investor's future
wellbeing. In fact, everyone makes savings and investments. For any investor who
invests money in various financial instruments, there will be varying degree of
risks involved. Every investor has to appraise his risk-appetite, understand his
financial goals and make investments. It is also important to analyse the risk-return
trade off and then make investment decision.

The investment is the employment of funds with the aim of achieving additional
income or growth in value. The essential quality of an investment is that it involves
"waiting" for a reward. It involves the commitment of resources, which have been
saved or put away from current consumption in the hope that some benefits accrue
in future. Broadly speaking, an 89 investment decision is a trade - off between risk
and return. All investment choices are made at points of time in accordance with
the personal investment ends and in contemplation of uncertain future.

 Choice of Investments:

The choice for an investment is generally influenced by:-

1. Investor’s personal profit, age, marital status and family responsibilities.

2. Financial status, income, savings, financial commitments and tax position.

3. One’s attitude towards risk or risk appetite.

An investor’s plan for investment is developed on the following parameters:-

a. Liquidity needs: The liquidity is the conversion of the investments into cash for
meeting urgent expenses or commitments. An investor may invest his surplus
money into various kinds of investment instruments with an objective of encashing
an instrument at the earliest when needed. The investment in a savings bank
account is highly liquid and in a bond illiquid.

b. Appropriate time horizon: The money saved by the investors is used for
fulfilling future needs and the investor earns the returns on different financial
instruments as per their features. The investor chooses the savings and investment
instruments in view of his plans for future needs. Thus, investments in money
market instruments for short term and in fixed deposits/bonds for long term are
made.

c. Regular income and capital appreciation requirements: The need for getting
a regular income is one of the important criteria for some investors. An old -aged
investor may be more inclined to invest in a monthly income scheme to have
regular income for fulfilling his regular daily needs. Another investor may put the
money in a fixed deposit for 3-5 years since his need is to get cumulative returns.
Some investors are not satisfied with moderate returns and thus invest in equity
shares. This enables them to earn capital appreciation along with good returns
which are not available in banks.

d. Need for diversification: A wise investor always likes to invest the savings in a
diversified portfolio. This helps in balancing out the inherent risks of investments.
The diversification helps in minimizing the risks, if not eliminating it totally. An
investor may invest in a basket of securities and also in many company shares if
equity investments is the only option chosen. 90

e. Minimize tax liability: Some financial instruments provide tax benefits and
many plan their investment options to minimize their tax liability. The investors
normally in higher tax brackets choose to invest in LIC schemes or PPF accounts
to avail tax benefits and rebates, thus their tax liability gets reduced. The Income
Tax Act 1961 provides such benefits under various sections.

 The mutual fund industry in India presents an interesting scenario of a large


number of investors, a large variety of product offerings and co-existence of
private, public and foreign Asset Management Companies. The investors, at
large, in the mutual fund industry make investments in the various schemes
of mutual funds, in view of their risk-appetite and their investment goals.
 Since the risk diversification is one of the unique features of mutual fund
investments, the investment pattern of the investors is guided by the scheme
objectives and one’s financial goals. It has been largely observed that the
Corporates are the dominant investor group in the Indian Mutual Fund
Industry and they account for almost 48% of the total investment (AUMs) in
the industry and they are more oriented towards non-equity funds which
offer high security & liquidity and hence their propensity towards
Liquid/Money Market and debt-oriented funds;
 The second dominant group in the industry is the Retail investors’ group
which accounts for almost 24% of the total investment (AUMs) in the
industry, while they account for 98% of the total investors in the industry.
The portfolio of this group is highly skewed towards equity oriented
schemes (almost 80%) which offer high return, capital appreciation coupled
with high risk and 18% of the portfolio accounts for debt oriented and
balanced funds.
Factors affecting investor’s investment pattern:

 The savings and investments have been an integral part of human existence.
As the future always remain uncertain, the money saved today comes handy
tomorrow or whenever required. The investors may have their own
individual objectives for investment.
 The options for savings & investments are continuously increasing. It is
possible for an investor to have more than one of these objectives , the
success of one must come at the expense of others. The basic objectives of
making savings and investment are 93.

2.3 Basic Objectives:

1. Safety
 As a matter of fact, there is no such thing as a completely safe and secure
investment. On the one hand, one may see his savings eroding in a financial
instrument and on the other, one can have ultimate safety of the investment
funds by the purchase of government securities or through the purchase of
the highest quality corporate bonds issued by the blue chip companies. Such
securities are the best means of preserving principal while receiving a
specified rate of return. Even the bank deposits provide greatest safety.
 The safest investments are found in the money market and include such
securities as Treasury bills, certificates of deposit, commercial paper or in
the fixed income (bond) market in the form of municipal and other
government bonds and in corporate bonds.
2. Income
 The safest investments are also the ones that are likely to have the lowest
rate of income, return or yield. The investors must inevitably sacrifice a
degree of safety if they want to increase their income. There is an inverse
relationship between safety and yield: as yield increases, safety generally
goes down, and vice-versa.
 In order to increase their rate of investment return and take on risk above
that of money market instruments or government bonds, investors may
choose to purchase the corporate bonds. Most investors, even the most
conservative ones, want some level of income generation in their portfolios.
3. Growth of Capital
 The investor also wishes to have a rate of return from an increase in value of
investment, often referred to as a capital gain. The capital gains are entirely
different from yield as they are only realized when the security is sold for a
price that is higher than the price at which it was originally purchased. In the
growth objective, the investor seeks the possibility of long term growth.
 The growth of capital is mostly concerned with the purchase of shares,
which may offer low yields but considerable opportunity for increase in
value. The blue-chip shares offer the best of all worlds by possessing
reasonable safety, modest income and potential for growth in capital
generated by long-term increases in corporate revenues and earnings as the
company matures.
Secondary Objectives:

1. Tax-Benefits

An investor may have some investments to have tax benefits as part of his or her
investment strategy. A highly-paid executive may want to seek investments with
favorable tax benefits in order to lessen the overall income tax burden, e.g.
investment in PPF or LIC policy.

2. Marketability / Liquidity
 Many of the investments are reasonably illiquid, meaning that they cannot
be immediately sold and easily converted into cash. Achieving a degree of
liquidity, however, may require the sacrifice of a certain level of income or
potential for capital gains.
 The shares are often considered the most liquid of investments, since they
can usually be sold within a day or two. The bonds can also be fairly
marketable, but some bonds are highly illiquid, or non-tradable, having a
fixed term. Similarly, money market instruments may only be redeemable on
the precise date at which the fixed term ends. If an investor seeks liquidity,
non-tradable bonds should not be held in portfolio. It is seen from each of
the five objectives discussed above that the advantages of one often comes at
the expense of the benefits of another. If an investor desires growth, for
instance, he or she must often sacrifice some income and safety.
 The choosing of a single strategic objective and assigning weights to all
other possible objectives depends on such factors as the investor's
temperament, stage of life, marital status, family situation, and so on. Each
investor is sure to find an appropriate mix of investment opportunities. One
needs to be concerned with spending the appropriate amount of time and
effort in finding, studying and deciding on the opportunities that match one’s
objectives.
 Each mutual fund describes its investment objective in its prospectus along
with the strategy the fund manager follows to meet that objective. The
mutual fund investors often look for funds whose stated objectives are
compatible with their own goals.
Chapter 3

Research methodology

Objective of the study:

 To identify the factors considered by the investors for a suitable investment.


 To understand the most preferred Investment Avenue.
 To study the relation between the demographic profile of investors and
investment avenues that they opted.
 To study the behavior of different consumer according to the risk related to
different investment options.

Sampling factors Data collection:

 Primary data:

The primary data for this study is collected with the objective in mind “a study on

the customer needs and pattern of an Indian customer in insurance industry of

FINAMIGO CONSULTANTS”.

 Secondary data:

The secondary data for the study is collected with the information that is

being published in journals and magazines and from the internet.

Tools

The data required for the study is collected with the help of questionnaire. These

Questionaries are handed over to the customers and asked to get it filled up. The
data is interpreted from the information that is incurred from the questionnaire

 Sampling area:

The respondents are the people who reside in Delhi

 Sample size

Due to the limitation of time and scope of the study the number of respondents

from which the data is collected is 100.

 Research Tools of analysis

Analytical techniques are used to obtain findings and arrange information in a

logical sequence from the data collected. After tabulation of the data, researcher

used the following quantitative techniques

1. Percentage Analysis

The data that is obtained is from the questionnaire is analyzed through percentage

analysis. The results are shown on the percentage basis

2. Graphs

Graphical representations are used to show the results in simple form .The graphs

are prepared on the basis of data that is received from the percentage analysis.
 Sampling method:

Random sampling method.

 Research design:

Descriptive research design used here.

 Limitation of study:

The study suffers from a few limitations, which will have to be kept in mind for the

findings to be fairly interpreted.

 The recommendations are subjected to time and cost constraint.


 Sampling has its own limitations, which would have resulted in minor errors.
 There can be errors due to bias of respondents.
 The size of the sampling was not big enough to arrive at strong conclusion.
 The results should be interpreted with the above limitations in perspective.
Chapter 4

Data analysis and interpretation


Chapter 5
Findings and discussions
 FINDINGS:
 Most of the respondents, 55% of them are of the age group 20 – 40 years.
 Salaried class people make more investments.
 Most of the respondents i.e., 43.0% between Rs.20, 000 – Rs.40,000.
 Majority, 32% of respondents have 4 persons in the family.
 90% had Fixed Deposit as their preferred current investment.
 82% have tax benefits as their investment objectives.
 58% primarily make investments on fixed deposits.
 84.0% of the respondents - safest avenue of investment is fixed deposit with
No risk and most risky avenue of investment is shares by 60% respondents.

 FINDINGS - Chi Square Analysis:


 From the chi-square analysis, It is found that there is no relationship
between:
 Age and current investment avenues.
 Income and First Preferred Investment Avenue.
 Occupation and First Preferred Investment Avenue.
 Gender and First Preferred Investment Avenue.
 Family size and First Preferred Investment Avenue.
 Age and Investment objective.
 It is found that there is significant relationship between:
 Age group and First preferred investment avenues.
 Age group and Risk Profile of most Preferred Investment Avenue.
 Income and Risk Profile of most Preferred.
Chapter 6
Conclusions

 Insurance happens to be a mega opportunity in India. Yet, nearly 80% of


Indian population is without life insurance cover, continue to be below
international standards which offer greater opportunities in this sector. With
other investment avenues remaining unmoved, insurance and mutual funds
offer comparatively better return to customer. With tax and investment
planning as its main targeting tools, insurance is bound to grow at a rapid
pace.
 The project helped me to find out the customer satisfaction and expectations
from the various plans offered by insurance companies with specific
reference to market linked insurance plan. Appropriate suggestions have
been given based on the research findings. It was a great learning experience
and I will carry this experience with me in all my future endeavors’.
Chapter 7

Suggestions and recommendations:

 Creating awareness about different investment avenues.


 Increase Risk free investment opportunities.
 Age group and income has a significant relationship with the investment
avenue and risk of the avenues.

LIMITATIONS

 Small sample size.


 Region restricted.
 Time factor.

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