“THE STUDY OF INSURANCE & HDFC PRODUCT”

PLACE: - NEAR HDFC BANK

CITY: - JHANSI
A
SUMMER TRANING REPORT
SUBMITTED
IN PARTIAL FULFILLMENT FOR THE AWARD OF THE DEGREE OF
MASTER OF BUSINESS ADMINISTRATION
2008-2010
GUDIED BY: - SUBMITTEDBY:-

Ms. Anshul Shrivastava Deepak Kumar Kushwaha

(H.O.D, Mgmt Deptt.) M.B.A 4th SEM

Jain College, Gwalior Jain College, Gwalior

SUBMITTED TO

DEPARTMENT OF MANAGEMENT
JAIN COLLEGE, GWALIOR

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(AFFILATED TO PUNJAB TECHNICAL UNIVERSITY, JALANDHAR)

STUDENT DECLARATION

I Deepak Kumar Kushwaha hereby declare that this summer training report entitled “THE STUDY OF
INSURANCE & HDFC PRODUCT” is carried out by me at “HDFC STANDARD LIFE INSURANCE
CO. LTD., JHANSI under the guidance of Mr. Paritosh Singh, Branch Manager, HDFCSLIC, Jhansi, for
partial fulfilment for the award of the degree of, Master of business administration at Department of
Management Jain College, Gwalior (M.P.).

DATE: Deepak Kumar Kushwaha

PLACE: Gwalior (Name & Signature of student)

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 GUIDE CERTIFICATE

It is certified that the summer training report entitled, “THE STUDY OF INSURANCE & HDFC
PRODUCT” is submitted by Mr.Deepak Kumar Kushwaha for partial fulfilment for the award of the
degree of Master of Business Administration at Department of Management, Jain College, and Gwalior
(M.P.). It is a record of candidate’s own work carried out at HDFC STANDARD LIFE INSURANCE CO.
LTD, JHANSI

(Guide name)

Designation & Department

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 ACKNOWLEDGEMENT

The completion of Summer training report entitled, “THE STUDY OF INSURANCE & HDFC
PRODUCT” give me an opportunity to convey my gratitude‘s to all those who have helped me to complete
this research work successfully and well within time.

I would be failing in my duties if I do not express my overwhelming sense of gratitude to Mr.

Manoj Jain Chairman, Mr. Sanjay Jain and Ms. Mayuri chaudhry, Director, Jain College, Gwalior
(M.P.).

I owe utmost thanks, Ms. Anshul Shrivastava, H.O.D. of Management Department, and the
faculties of management Jain College Gwalior (M.P.) for their valuable suggestion and discussions made
throughout my research work.

In the last I would like to thank all individuals known or unknown who have helped me directly
or indirectly during the research fellowship period.

I must say that all of these great people have done their social job, which I will also like to oblige
others in form of similar or even better support throughout my life.

(Name & signature of student)

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 PREFACE

As the part of my M.B.A curriculum I was required to undergo summer training in a business organization for
45 days. I approached HDFC STANDARD LIFE INSURANCE CO. LTD, JHANSI, for this purpose and got
an opportunity to get training from Mr Paritosh Singh, Branch Manager, who readily agreed to extend his co-
operation.

The project was assigned to me by the Company. In this record I have put my best efforts to compile
the data to the highest level of accuracy and give my views to the best of my judgement.

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 CONTENTS

PARTICUlRAS PAGE NO.

1. About The Project 1

2. Company Profile 2-7

3. Research Methodology 8-9

4. Introduction Of Working Capital 10

5. Company Business Performance 11-20

6. Insurance 21-24

7. Data Interpretation 25-32

8. Finding 33

9. Suggestion 34

10. Conclusion 35

11. Limitation 36

12. Bibliography 37

13. Questionnaire 38-39

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 ABOUT THE PROJECT

The project is related to the internship training which an optional in M.B.A curriculum. For this i approached
to HDFC standard life Insurance Company Ltd, JHANSI, which is a public owned company. Here i was
assigned the topic of the project “THE STUDY OF INSURANCE & HDFC PRODUCT” In this project i
was asked to know the perception of the customers towards these policies. The project was assigned for 45
days. After the completion of project, i was asked to suggest the company some ideas through which
marketing of these products can be enhanced. In this project i was asked to conduct market research. I
conducted exploratory research and used the primary as well as secondary data. I took the help of
questionnaire method for this purpose. I got the questionnaire filled by about 50 customers at JHANSI
regarding these policies and created the awareness among customers.

After the completion of project in 45 days, I was appreciated and my project was accepted by the
Branch Manager Mr. Paritosh Singh.

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 COMPANY PROFILE

INTRODUCTION

HDFC Standard Life, one of India’s leading private life insurance companies, offers a range of
individual and group insurance solutions. It is a joint venture between Housing Development Finance
Corporation Limited (HDFC), India’s leading housing finance institution and Standard Life plc, the leading
provider of financial services in the United Kingdom.

HDFC Ltd. holds 72.43% and Standard Life (Mauritius Holding) Ltd. holds 26.00% of equity in the
joint venture, while the rest is held by others.

HDFC Standard Life’s product portfolio comprises solutions, which meet various customer needs such
as Protection, Pension, Savings, Investment and Health. Customers have the added advantage of customizing
the plans, by adding optional benefits called riders, at a nominal price. The company currently has 32 retail
and 4 group products in its portfolio, along with five optional rider benefits catering to the savings,
investment, protection and retirement needs of customers.

HDFC Standard Life continues to have one of the widest reaches among new insurance companies
with 568 branches servicing customer needs in over 700 cities and towns. The company has a strong presence
in its existing markets with a base of 2, 00,000 Financial Consultants.

Board of Director

Mr. Deepak S. Parekh is the Chairman of the Company. He is also the Executive Chairman of Housing
Development Finance Corporation Limited (HDFC Limited). He joined HDFC Limited in a senior
management position in 1978. He was inducted as a whole-time director of HDFC Limited in 1985 and was
appointed as its Executive Chairman in 1993. He is the Chief Executive Officer of HDFC Limited. Mr.
Parekh is a Fellow of the Institute of Chartered Accountants (England & Wales).

ABOUT HDFC STANDARD LIFE

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HDFC Standard Life is one of India’s leading private life insurance companies, which offers a range of
individual and group insurance solutions. It is a joint venture between Housing Development Finance
Corporation Limited (HDFC), India’s leading housing finance institution and Standard Life plc, a leading
provider of financial services in the United Kingdom.

HDFC Standard Life’s product portfolio comprises solutions, which meet various customer needs such
as Protection, Pension, Savings, Investment, and Health. Customers have the added advantage of customizing
their Plans, by adding optional benefits called riders, at a nominal price. The company currently has 25 retail
and 4 group products in its portfolio, along with five optional rider benefits Catering to the savings,
investment, protection and retirement needs of customers.

HDFC Standard Life continues to have one of the widest reaches among new insurance companies
through a network of 595 offices serving over 720 cities and towns across the country. The company has also
increased its depth in existing markets with a strong base of more than 207,000 Financial Consultants.

HDFC is the leading financial company in India. IT has large network of branches all over India.
HDFC Securities which is fully subsidiary of HDFC provides Life Insurance service.HDFC and its subsidiary
provides following services.

Life Insurance
Demat Service
Banking Service
Housing Finance
Vehicle Finance
Education Loan
Personal Loan
Mutual Fund

OUR VISION & VALUES

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Our Vision

‘The most successful and admired life insurance company, which means that we are the most trusted
company, the easiest to deal with, offer the best value for money, and set the standards in the industry’.
‘The most obvious choice for all’.

Our Values

Values that we observe while we work:

• Integrity
• Innovation
• Customer centric
• People Care “One for all and all for one”
• Team work
• Joy and Simplicity

OUR PARENTAGE

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HDFC Limited

HDFC Limited has set benchmarks for the Indian housing finance industry. Recognition for the
service to the sector has come from several national and international entities including the World Bank that
has lauded HDFC as a model housing finance company for the developing countries. HDFC has undertaken a
lot of consultancies abroad assisting different countries including Egypt, Maldives, and Bangladesh in the
setting up of housing finance companies. Customer Service and satisfaction has been the mainstay of the
organization.

HDFC Limited has assisted more than 3.3 million families own a home, since its inception in 1977
across 2400 cities and towns through its network of over 250 offices. It has international offices in Dubai,
London and Singapore with service associates in Saudi Arabia, Qatar, Kuwait and Oman to assist NRIs and
PIOs to own a home back in India.

Standard Life Group

The Standard Life Group has been looking after the financial needs of customers for over 180 years. It
currently has a customer base of around 7 million people who rely on the company for their insurance,
pension, investment, banking and health-care needs. Its investment manager currently administers £125
billion in assets. It is a leading pension’s provider in the UK, and is rated by Standard & Poor as ‘strong’ with
a rating of A+ and as ‘good’ with a rating of A1 by Moody’s.

Standard Life was awarded the ‘Best Pension Provider’ in 2004, 2005 and 2006 at the Money
Marketing Awards, and it was voted a 5 star life and pension provider at the Financial Adviser Service
Awards for the last 10 years running.

The ‘5 Star’ accolade has also been awarded to Standard Life Investments for the last 10 years, and to
Standard Life Bank since its inception in 1998.

AWARDS & ACCOLADES

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Received CIO 'The Ingenius 100 2009' Award

HDFC Standard Life has received the CIO ‘The Ingenious 100 - 2009 Award,’ for ATLAS (Agency
Training Licensing and Servicing System). Additionally, the company has received the CIO 100 ‘Security
Award 2009’ for pioneering LANDesk Management and Security Suite security implementation and taking its
security to a higher level of technological excellence.

HDFC Standard has received the CIO 100 Award for the third consecutive year. It had received the
2008 CIO Bold Award for Consultant Corner and CIO Security Award for our initiatives for a secure
computing environment, including Sesame - Identity and Access Management. In 2007, the company received
CIO 100 award for Wonders and a Special Award in Storage category.

CIO magazine has a long tradition of honouring leading companies for business and technology
leadership and innovations through its flagship award program – CIO 100. It’s a celebration of 100
organizations (and the people within them) that are using IT in innovative ways to deliver business value,
whether by creating competitive advantage, optimizing business processes, enabling growth or improving
relationships with customers.

Received Diamond EDGE Award 2009

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 HDFC Standard Life has received the Diamond EDGE Award 2009 for its mobile workforce portal -
Consultant Corner. EDGE - Enterprises Driving Growth and Excellence (using IT) is an initiative by
the ,Network Computing magazine to identify, recognise, and honour end-user companies in India that have
demonstrated the best use of technology to solve a business problem, improve business competitiveness, and
deliver quantifiable ROI to stakeholders.

Network Computing magazine is part of CMP Technology, which brings more than 100 IT media
brands to more than 18 million technology and business decision makers worldwide.

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 RESEARCH METHODOLOGY

Identification of problem:

When we start any research the first step is the identification of the problem. This is the most
important step in any research.

This report is mainly conducted to analysis the financial position of the company .This research
is purely analytical work because the research is an attempt to analyse the financial position of the
company on the basis of data collected.

Types of problem

The research being undertaken by the research is purely analytical work

because the research is an attempt to analyse the financial position of the

company on the basis of data collected.

Review of Literature:

Review of Literature means, study of the pre existing Literature related with the particular
research.

I also studied some Literature these are follows

 Annual report of HDFC standard life insurance. co

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Research objective

1. Evaluate financial productivity of company.

2. Evaluate financial policies.
3. To analysis the dividend policy of HDFCSLIC.
4. To analysis the capital structure of HDFCSLIC.
5. To analysis the working capital management in HDFCSLIC.
6. To suggest measures to improve the financial management of HDFCSLIC.

Types of data:

Basically ther are two types of data

1. Primary data
2. Secondary data

The data which used for research Secondary data

Because all the research work is done on the basis of balance sheet and profit and loss account of the
company which are already prepared by the company for its own use.

Source of data:

The various sources from where I have collected secondary data based on:

1. Balance sheet & profit & loss account of HDFCSLIC.

2. Annual report of HDFCSLIC.

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 INTRODUCTION OF WORKING CAPITAL

Working capital refers to firm’s investment in short term assets i.e.cash,short term securities,
amount receivables and inventories of raw material, work in process and finished goods. it can also be
regarded as that portion of the firm’s total capital which is employed in short term operation.

In simple words we can say that working capital is the investment needed for carrying out day
to day operation of the business smoothly.

The goal of working capital management is to manage the current assets and liabilities in such
a way that an acceptable level of net working capital is maintained.

(a) CONCEPT OF WORKING CAPITAL

There are two concept of working capital.

1. Gross working capital

2. Net working capital

1.Gross working capital:

It refers to the firm’s investment in current assets. The amount of current liabilities is not
deducted from the total of current assets. This concept views working capital & aggregate current assets as
two inter-changeable terms. This concept is also referred to as “current capital” or “circulating capital”.

2.Net working capital:

Net Working Capital, is defined as Current Assets minus Current Liabilities. Current assets include
stocks, debtors, cash & equivalents and other current assets. Current liabilities include all the short-term
borrowings. The formula is the following and the figures are expressed in millions:

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= (stocks + debtors + cash & equivalents + current assets,other) - creditors,short

COMPANY’S BUSINESS PERFORMANCE

Financial Highlights

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Operational Highlights

Growth through a comprehensive distribution network covering

over 700 cities …

…and the best underwriting standards in the industry

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PREMIUM ANALYSIS

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 APPENDIX 1

MCEV methodology and approach

The calculations of embedded value and new business profits have been done using a market
consistent embedded value (“MCEV”) approach. This approach differs from a traditional EV approach
primarily in respect of the way in which allowance for risk is made Within the traditional EV approach
allowance is made for risk through an increase in the risk discount rate used to value future shareholder cash
flows, whilst within the MCEV calculation explicit separate allowances are made for risk

There are two components to the MCEV:

1. Shareholder adjusted net worth – this component represents the market value of assets attributable
to shareholders. This amount is derived from the Indian GAAP balance sheet adjusted to allow for assets on a

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market value basis, elimination of intangible assets and to allow for shareholder attributable assets residing
within the unit-linked and non par policyholder funds.

2. Value of in-force – this component represents the discounted value of after tax shareholder attributable
cash flows expected on the business as at the valuation date. No allowance is made for future new business.
This amount has been adjusted to deduct allowances for non hedge able risk, frictional costs of required
capital and the time value associated with financial options and guarantees.

APPENDIX 2

Components of value of in force (“VIF”)

1. Present value of future profits (“PVFP”):

This component has been calculated by discounting the projected future after tax shareholder attributable cash
flows expected to arise on in-force business at the valuation date. The cash flows have been projected on a
deterministic basis using the company’s best estimate view of future persistency, mortality and expenses.
Future investment returns and the risk discount rate have been set equal to the returns from the risk free yield
curve at the closing balance sheet date.

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2. Cost of non-hedge able risk (“CNHR”):

A deduction from the PVFP is required in order to make appropriate allowance for non hedge able and non
economic risks. Within a traditional EV calculation this would be allowed for by an increase to the risk
discount rate, but within MCEV an explicit separate deduction is made.

3. Time Value of Financial Options and Guarantees ("TVFOG"):

The MCEV incorporates an allowance for risks associated with asymmetric shareholder returns associated
with the Participating (“Par”) Funds by deducting a cost for the TVFOG. This asymmetry primarily arises due
to the fact that if in deficit the Par Funds have to be funded 100% by the Shareholder Fund whereas if the
funds have surpluses only 10% of these are attributable to the Shareholder Fund.

4. Frictional Costs of Required Capital (“FCRC”):

An allowance has been made within the MCEV for the frictional costs of holding required capital (“FCRC”).
Required capital has been set equal to the amount of shareholder attributable assets required to back local
regulatory solvency requirements. The FCRC has been calculated as the discounted value of investment costs
and taxes on shareholder attributable assets backing the required capital over the lifetime of the in-force
business.

APPENDIX 3

Key assumptions underlying MCEV

1. Expenses

Maintenance expenses have been based on actual expense levels currently being incurred and make no
allowance for future productivity improvements. .

Actual acquisition expenses are currently higher than these assumptions and therefore any excess acquisition
expense over the assumption is recognised in the period and the shareholder attributable component, net of
tax, deducted from the value of new business for that period.

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2. Economic assumptions

An MCEV approach is used with projected earned and risk discount rates both being set equal to the risk free
(government bond) yield curve at the relevant balance sheet date..

3. Mortality and morbidity

Mortality and morbidity assumptions are set by product line and are based on past experience.

4. Persistency

Persistency assumptions are set by product line, payment mode and duration in-force, based on past
experience and expectations of future experience. Separate decrements are modeled for lapses, surrenders and
paid-ups.

5. Tax assumptions

Tax assumptions are based on interpretation of existing tax legislation, where appropriate supported by legal
opinion. No allowance is made for future changes to taxation such as the Direct Tax Code. These changes will
be incorporated only once materially enacted.

APPENDIX 4

New business profits and analysis of change in MCEV

The analysis of change in MCEV identifies the main drivers that have caused the MCEV to move over the
financial year.

The value of new business written in the year is normally the most significant driver for increases in value
shown in the analysis of change.

In presenting the analysis of change, the following approach has been adopted:

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A. Impact of changes in assumptions and methodology

The impacts from updates to assumptions and methodology are allowed for as follows:

•Updates to non economic assumptions and methodology are made at the start of the period, and the
subsequent analysis of change calculated using these revisions

•Updates to economic assumptions including revisions to the economic scenarios used for the TVFOG

calculation are made at the end of period and incorporated as a closing adjustment.

B. Experience variances

The impact on the MCEV from variations between the assumptions and actual experience are determined and
recognised in the period for non economic assumptions and at the end of the period for economic
assumptions.

The impacts on the variations for non economic assumptions are separately attributed to new and in-force
business.

C. Value of new business

New business profits are calculated as at end of period, using the opening (i.e. 31st March 2009) yield curve
and incorporate allowance for variations on non economic assumptions during the period.

The TVFOG associated with new business written during the year has been approximated by apportioning the
overall closing TVFOG (before changes to the end period economic assumptions) on the basis of guaranteed
benefits associated with the new and in force business. This TVFOG is incorporated as a deduction from the
new business profits.

The new business profits are calculated before and after acquisition expense overruns.

D. EV profits

EV profits are calculated as the movement in EV during the period less capital injections.
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E. EV Operating profit (“EVOP”)

EV operating profit (“EVOP”) is calculated as the movement in EV during the period less capital injections
and the impact of economic variances and economic assumption changes.

The EVOP represents the impact on the MCEV from performance that is considered within management
control.

APPENDIX 5

Statutory profit and loss account

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 APPENDIX 6

Statutory balance sheet

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INSURANCE

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 Insurance is a contract between two parties whereby one party agrees to undertake the risk of another
in exchange for consideration known as premium and promises to pay a fixed sum of money to the
other party on happening of an uncertain event of after the expiry of a certain period in case of life
insurance or to indemnify the other party on happening of an uncertain event in case of general
insurance.
The party bearing the risk is known as the “Insurer” or “Assurer” and the party whose risk is
covered is known as the “Insured” or “Assured”.
Insurance provides financial protection against a loss arising out of happening of an uncertain
event. A person can avail this facility by paying premium to an insurance company.

Benefits of Life Insurance:

 It encourages saving and forces thrift.

 It is superior to a traditional savings vehicle.

 It helps to achieve the purpose of life assured.

 It can be enchased and facilitates quick borrowing.

 It provides valuable tax relief.

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Traditional Life insurance Plans By HDFC-SLIC:

1. Protection Plans: -Term assurance

Loan cover term assurance

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2. Investment Plan: - Single premium for whole of life

3. Pension plan: - Personal pension plan

4. Saving plan: - Endowment assurance plan

Money back plan

Children’s plan

5. Unit Linked Investment Plans

 Unit Linked Endowment Plus II

 Unit Linked Young Star Plus II
 Unit Linked Enhanced Life Protection Plan II

PROTECTION PLANS

HDFC Term Assurance Plan

This plan is designed to help secure your family’s financial needs in case of uncertainties. The plan does this
by providing a lump sum to the family of the life assured in case of death or critical illness (if option is
chosen) of the life assured during the term of the contract. One can choose the lump sum that would replace

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the income lost to one’s family in the unfortunate event of one’s death. This helps your family to maintain
their financial independence, even when you are not around.

Features

Advantages

 High cover at a very nominal cost.

 Flexibility to choose the Sum Assured.

 Additional benefit options can be availed at marginal costs.

 Premium amount remains the same over the term of the policy in case of regular premium

 Option of paying single premium or regular premium.

 Tax benefits under sections 80C, 80D and 10(10D) of Income Tax Act, 1961.

For more details on risk factors, terms and conditions, please read the Product Brochure carefully
and/or consult Financial Consultant before taking a decision.

HDFC Loan Cover Term Assurance Plan

This plan aims to protect your family from your loan liabilities in case of your unfortunate demise within the
policy term. It provides the beneficiary with a lump sum amount, which is a decreasing percentage of the
initial Sum Assured. This means that as the outstanding loan decreases as per the loan schedule, the cover
under the policy also decreases as per the policy schedule.
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 Features

Advantages
 Flexibility to choose the Sum Assured.
 Decreasing Sum Assurance as the outstanding loan decreases ensures that you do not pay for the
protection you don’t need.

 Additional Optional Benefit is available at a nominal cost.

 Option of paying single premium or regular premium.

 Tax benefits are offered under section 80C, 80 D and 10(10D) of the Income Tax Act, 1961.

For more details on risk factors, terms and conditions, please read the Product Brochure carefully and/or
consult Financial Consultant before taking a decision.

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1.Customers’ perception towards Life Insurance & Pension Policy.

Customers’ Perception Percentage

Indispensible 75%
Important 20%
Not important 5%

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Interpretation – It is clear that by above graph that a large part of customer has Perception that these policies
are indispensible for human life. 20% say that it is important and only 5% ignore these policies. According to
data customers has positive perception towards these policies.

1. (a) Factors responsible for choosing these policies.

Customers perception Percentage

A. Secured life + Financial help 25%

B. Protection of family 10%

C. Tax benefits 5%
D. Above all 60%

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Interpretation – From the above graph, it is clear that there are many factors responsible for choosing these
policies, like- Secured life, financial help, protection and Tax benefits.

2 (B) Factors responsible for avoiding these Policies.

Customers’ Perception Percentage

A. Poor service of claim settlement 70%

B. Unfaithfulness 20%
C. Money wastage 10%

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Interpretation – From the above graph, it is clear that there are many factors responsible for avoiding these
policies, like- Poor claim settlement. Unfaithfulness, money wastage etc.

1) Company preferred by customers for Insurance Policies.

Customers’ Preference Percentage

Government company 60%
United India Insurance Co. Ltd 35%
LIC 25%

Private Company 40%

HDFC 18%
ICICI 12%
Others 10%
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Interpretation – From the above data, it is clear that customers prefer government companies for insurance
policies. It is also clear that customer prefer HDFC standard life insurance co.ltd Jhansi

4) Satisfaction of customers about the services provided by HDFC.

Customers’ satisfaction Percentage

Very Satisfied 60%
Satisfied 25%
Not satisfied 15%

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Interpretation – It is clear by the above graph that the services provided by HDFC SLIC Ltd are very good.

GLOSSARY

Accident Benefit: An add-on with a life policy. It compensates a policyholder in the event of death or injury
by accident
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Annuity: An investment option that makes a series of regular payments to an individual in exchange for a
premium or a series of premia.

Asset: Everything owned or due to a person

Asset allocation: How your investments are spread across various asset classes

Bond: It is like an IOU. By buying a bond you loan money to a company, a municipality, state or the Central
Government

Bonus: The amount paid as return in a ‘with-profit’ policy. The bonus, expressed as a percentage of the sum
assured, is generally declared every year. The amount is linked to the profits earned by the insurer. Depending
on the time of withdrawal, there are two kinds of bonuses – reversionary and cash. A reversionary bonus can
be encashed only on maturity of the policy; a cash bonus can be withdrawn when declared

Capital gains: Profit earned from the sale of stocks, mutual fund units and real estate. Long-term capital
gains arise from assets owned for more than a year while short-term capital gains are made from assets owned
for less than a year.

Critical illness rider: A rider that provides a policyholder financial protection in the event of a critical illness

Death benefit: The amount payable to the nominee on death of the policyholder. The amount paid is the sum
assured plus benefits applicable (if any) less outstanding loans.

Down payment: The money that a home buyer has to contribute, often at least 15 per cent of the value of the
house, when he is taking a home loan.

Emergency fund: The money, in the form of liquid investments in bank savings accounts, two-in-one
accounts and liquid funds, you need, to take care of emergencies like a job loss that your insurance policies
wouldn’t cover

Endowment plans: An insurance plan that provides a policyholder risk cover and some return on investment.
Usually suitable for the risk-averse

Financial planning: It covers the essential elements of a person’s financial affairs and is aimed at achieving a
person’s financial goals

Group Insurance: An insurance policy taken out by employers to provide life cover to their employees.
Usually the cheapest form of insurance.

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Insured: The policyholder

Insurer: The insurance company

Investments: Assets like fixed deposits, post office savings, bonds and stocks that are acquired for the
purpose of earning a return

Lock-in period: The period of time for which investments made in an investment option cannot be
withdrawn.

Maturity date: The date on which a policy term or fixed-income investment like fixed deposit or bond comes
to an end

Money-back plans: A variant of endowment plans in which survival benefits are disbursed through the
policy term, rather than in a lump sum at the end.

Net asset value (NAV):The simplest measure of how a scheme is performing, it tells how much each unit of
it is worth at any point in time. A scheme’s NAV is its net assets (the market value of the financial securities it
owns minus whatever it owes) divided by the number of units it has issued.

Nominee: The person(s) nominated by the policyholder to receive the policy benefits in the event of his
death.

Pension Plan: Investment products offered by insurance companies and mutual funds that required the
investor to make defined contributions over regular periods, mostly every year. The contributions are invested
according to a pre-decided investment plan. At retirement, the accumulation is paid out through regular pay-
out options

Policy: The legal document issued by an insurance company to a policyholder that states the terms and
conditions of an insurance contract.

Policyholder: The person who buys an insurance policy. Also referred to as the ‘insured’

Policy term: The period for which an insurance policy provides cover

Pre-payment: Partial or full repayment of the loan before the end of the tenure.

Premium: The amount paid by the insured to the insurer to buy cover

Riders: Additional covers that can be added to a life policy, for a cost

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Sum assured: The amount of cover taken under a life insurance policy, it is the minimum amount that will be
paid on death of the policyholder during the policy term

Surrender value: The amount payable by the insurer to the owner of an investment-based plan in case he
opts to terminate the policy after three years (the mandatory lock-in period) but before its maturity date. The
surrender value will be the premia paid till date minus surrender charges and any outstanding loans due

Survival benefits: The amount payable to a policyholder under an investment-based plan if he survives the
policy term. Typically, it is the sum assured plus returns (guaranteed additions / bonus) accrued.

Term plans: A plan that provides life cover for a specified period of time, but no return on the premia paid

Terminal bonus: A one-time bonus paid on maturity of a with-profit plan

Vesting date: Generally used in the context of pension plans and children’s plans offered by life insurance
companies. It is a date signifying a milestone in a policy. In pension plans, it is the date from which the
policyholder starts receiving pension. In children’s plans, it is the date from which a child becomes the owner
of a policy taken out in his name (generally, around his 18th birthday).

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 FINDINGS

During the survey on “THE STUDY OF INSURANCE & HDFC PRODUCT”, I found several points,
these are:-

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1. Customers are very keen towards these policies. They have positive perception as they say these
policies are indispensable to human life because these policies undertake uncertain risk associated with
today’s vast life.
2. There are many factors which are responsible for choosing or avoiding these policies.

 Some of the factors for choosing these policies are-

Security of life
Financial help
Protection of family
Tax benefits under 80(C) of income tax
Low premium rate
 Some of the factors responsible for avoiding these policies are- Poor services provided by
companies at the time of claim settlement .Unfaithfulness of insurance companies. Customers
negative attitude towards these policies. Improper communication between insurance companies
and customers.

 When asked, 53% of advisors said that they are not interested to work with HDFC SLIC
Securities, to the contrary with they don’t have any such expansion plans and they have little
knowledge about HDFC SLIC.

SUGGESTION

 No. of advertisements on Television & newspapers to be increased.

 Should use the FM-radio station as the medium of spreading awareness.

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 Changes in the policies should be communicated to the customers at the earliest.

 Provide and adopt such policies from which customers get maximum benefits.

 Increase the distribution network.

 Provide a proper training to the workforce.

 Provide lower premium policies so that we could target middle class people and generate good cash
flow for further growth.

 Company should more orient towards rural market.

 Since customers are more faithful on government insurance companies due to some reasons, like- low
premium rate, reliability etc. therefore company should retain customers’ expectation.

CONCLUSION

 Life insurance service sector is highly growing finance sector.

 HDFC-SLIC is the private insurance organization which is developing and growing at fast rate.
 Because of less advertisement, people are not aware of HDFC-SLIC insurance plans.

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  HDFC Standard Life is renowned for transparency and high corporate governance standards.
 HDFC SLIC have given a new direction to the flow of personal saving and enable small and medium
investors in remote rural and semi urban areas to reap the benefits of the stock market investment.
Indian insurance policy are thus playing a very important developmental role in allocation of scares
resources in the emerging economy.
 The awareness level of investor is low in advisors are interested in dealing in insurance policy.
 Insurance is a contract between insurers between insures and insure for any uncertain future events in
against of some fixed some of money.
 Insurance has the several types in which life insurance and pension Policy are one of them.
 Life insurance provides the reimbursement for any medical treatment where as accidental insurance
undertakes any injury expenses caused by any type of accident.

LIMITATIONS

During my training period, I found several drawbacks in the company. These limitations are-

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1. Company does not communicate its scheme properly with customers.

2. Company’s employees have not friendly behaviour with customers.

3. None of the training & development programs are provided by the company for its employees.

4. Some of the customers were also not co-operating me during my survey whereas some of them were

not providing accurate information.

5. No Guarantees: No investment is risk free. If the entire stock market declines in value, the value of
mutual fund shares will go down as well, no matter how balanced the portfolio. Investors encounter
fewer risks when they invest in mutual funds than when they buy and sell stocks on their own.
However, anyone who invests through a mutual fund runs the risk of losing money.

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BIBLIOGRAPHY

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Books:-

1. Agent’s Hand Book – HDFC Standard Life

2. Kothari C.R. Research Methodology & Techniques, 2nd Edition

3. Principles and Practice of Insurance – G.S. Panda

Magazines:-

1. Insurance Times (Insurance Monthly Magazine- May, 2008)

2. Pratiyogita Darpan, Dec 2009

Websites:

 http://www.google.co.in/
 http://www.hdfcinsurance.com
 http://www.mutualfundsindia.com
 http://www.amfiindia.com
 http://www.themanagementor.com
 http://www.indiastat.com
 http://www.apnabima.com

QUESTIONNAIRE

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I am Deepak Kumar Kushwaha, Pursuing MBA from Jain College, Gwalior. I am making a Project
report on the topic “customer Perception towards life Insurance Policy”. So for this purpose, I need
following information. So I would be thankful if you cooperate me by filling this questionnaire.

Personal information-

 NAME-

 SEX- M  F

AGE- 0-20YEARS

20-30 YEARS

30-40 YEARS

ABOVE 40 YEARS

 Occupation- Professional
Businessman
Employee
Other

 Monthly Income- Below 5,000

5,000 to 10,000
Above 10,000

1. Do you have any kind of Insurance policy?

Yes 
No 
If yes please mention the name of Policy______________

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2. Do you know about HDFC standard life Insurance Company?
Yes 
No

3. Do you have knowledge about Life Insurance and Pension Policy?

Yes
No 

4. Do you think these policies provide direct benefits to customers?

Yes
No 
5. Which company you prefer for these Insurance policies?
Government Private
United India  HDFCSLIC
LIC  ICICI 
Others  Reliance 

6. What is your Perception towards life & pension Policy?

Indispensable 
Important 
Not important 

7. In which of the financial market you have invested your money?

Share 
Mutual fund  
Insurance 
Other 

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