A Summer Training Project Report on

A STUDY OF PRODUCTS AND SERVICES OF TATA AIG LIFE

(TATA AIG INSURANCE CO.)
Submitted in partial fulfillment of the requirements for the award of the degree of Bachelor of Business Administration (BBA) programme of Guru Gobind Singh Indraprastha University, Delhi.

Submitted To: Ms. Ankita Popli

Submitted by: Sourabh Bharara Roll No.:06112201710

Delhi College of Advanced Studies B-7, Shanker Garden, Vikaspuri New Delhi 110018 Batch (2010-2013)

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DECLARATION
I, hereby declare that the Summer Training Project Report, entitled A Study Of Products And Services Of Tata AIG Life is an authentic work carried out by me at Tata AIG Insurance Co. It has not been submitted earlier for award of any degree or diploma to any institute or university.

Place: New Delhi Date:

Candidates signature Name: Sourabh Bharara Enroll. No.: 06112201710

Countersigned

Name: Ms. Ankita Popli Supervisor Delhi College of Advanced Studies

Name: Director Delhi College of Advanced Studies

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ACKNOWLEDGEMENT
It is my pleasure to be indebted to various people, who directly or indirectly contributed in the development of this work and who influenced my thinking, behavior and acts during the course of study. I express my sincere gratitude to the worthy Director of Delhi College of Advanced Studies, for providing me an opportunity to undergo summer training of doing this project under his leadership. I am thankful to for his/her support, cooperation and motivation provided to me during the training for constant inspiration, presence and blessings at Tata AIG Insurance Company Limited. I also extend my sincere indebtedness to Ms. Ankita Popli who provided her valuable suggestion and precious time in accomplishing my project. I also take the opportunity to express my sincere gratitude to each and every person, who directly or indirectly helped me throughout the project and without anyone of them this project would not have been possible. The immense learning from this project would be indelible forever.

Sourabh Bharara

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EXECUTIVE SUMMARY Insurance is a system to ease financial losses by transferring risk of loss from one entit y to another. It is a legal contract that protects people from the financial costs that result from loss of life, loss of health, lawsuits, or propert y damage. Insurance provides a means for indiv iduals & societ y to cope up with some of the risks faced in everyday life by everybody. Among the emerging markets, India has been drawing intense attention of late, fuelled in part by the fast expansion of its insurance market and the fact that this growth is now available to all.

Insurance is the most booming sector in India now -a-days so it has become reall y important for any person to study the insurance sector in India. I have done m y summer internship in TATA AIG Insurance Company Limited. During m y i nternship I was able to learn a lot of things that are existing in the insurance market. M y project is studying about the TATA AIG insurance company limited and so I have tried m y level best to collect as much information about the insurance sector as I c an and beside that I have also tried to know the market status of the company and to know the brand awareness of the company in the sector. In this project m y main focus was to study different policies of TATA AIG LIFE, find out their features, their plus and minus points and also see whether the company is able to meet needs and expectations of the people, whether its customer are satisfied or not.

Insurance history is given ,how the concept of insurance is evolved and how it change over the years, variou s reforms took place in the insurance industry in India ,Insurance Regulatory and Development

Authorit y(IRDA),then I have discussed how insurance industry is changed after liberalization of Indian insurance industry and entry of private players. Then profile of TATA AIG LIFE is given. The TATA Group ,one of the largest business group in India and American International

Group(AIG),world leading international insurance and financial service provider, comes together to form TATA AIG Group which provide both li fe insurance and general insurance. But my project is just concerned about TATA AIG LIFE. After profile of the company, profile of companys different products and services is given. Life insurance products for children, life insurance for adults. Then there is a Data Anal ysis for this purpose I have to collect primary as well as filled secondary data Primary data sources is Questionnaire which I had from general public (which includes its customers and non

customers). My sample size was 50 and sample des ign was Non Probabilit y sampling. For secondary data, I collected data from books, websites, and company journals and brochures. Data is anal yzed in the form of charts, pie diagrams and bar diagrams. Then I have given findings of m y project research and re commendations which managers of the company can use to improve company market share and reputation among the customers. vi

And finall y the conclusion of the project research, the conclusion I had also given the SWOT anal ysis of the company , then Annexure whi ch includes Questionnaire which was filled from the general public and Bibliography which gives details of the various sources from which I have taken data and information

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TABLE OF CONTENTS
S.No. 1 2 3 4 5 6 7 8 9 Certificate Declaration Acknowledgement Executive Summary List of Tables List of Figures List of Symbols List of Abbreviations Chapter-1: Introduction 10 Overview of Industry as a whole Profile of the organization History of the Organization Problems of the Organization Competitors Information S.W.O.T Analysis of the Organization Objectives of the study Scope of the study Methodology Topic Page No i ii iii iv v vi vii viii

Chapter-2: Conceptual Framework The Insurance Regulatory And Development Authority Impact Of Liberalization Current Scenario Of Industry Potential Of Insurance Industry In India Published Stories Product Profile Analysis Of Data viii

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Points Against Tata AIG Life

Chapter-3: Data Analysis and interpretation Chapter-4: Summary and Conclusion Results of the study Limitations Suggestions and Recommendations -

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Bibliography Appendix

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CHAPTER 1
INTRODUCTION

Overview of the Industry

The insurance sector in India has come a full circle from being an open competitive market to nationalization and back to a liberalized market again. Tracing the trends in the Indian insurance sector reveals the 360 degree turn witnessed over a period of almost two centuries.

With such a large population and the untapped market area of this population Insurance happens to be a very big opportunity in India. Today it stands as a business growing at the rate of 15-20 per cent annually. Together with banking services, it adds about 7 per cent to the countrys GDP .In spite of all this growth the statistics of the penetration of the insurance in the country is very poor. Nearly 80% of Indian populations are without Life insurance cover and the Health insurance. This is an indicator that growth potential for the insurance sector is immense in India. It was due to this immense growth that the regulations were introduced in the insurance sector and in continuation Malhotra Committee was constituted by the government in 1993 to examine the various aspects of the industry. The key element of the reform process was Participation of overseas insurance companies with 26% capital. Creating a more efficient and competitive financial system suitable for the requirements of the economy was the main idea behind this reform. 2

Since then the insurance industry has gone through many sea changes .The competition LIC started facing from these companies were threatening to the existence of LIC. Since the liberalization of the industry the insurance industry has never looked back and today stand as the one of the most competitive and exploring industry in India. The entry of the private players and the increased use of the new distribution are in the limelight today. The use of new distribution techniques and the IT tools has increased the scope of the industry in the longer run.

Profile of the Organization

THE TATA GROUP

The Tata Group, easily India's most recognized business group, was founded by Jamsetji Tata and began with a textile mill in central India in the 1870s.

From there, it has evolved into a truly diversified group, among other sectors, Engineering, Energy, Chemicals, Consumer Products, and Communications & IT. The group established Tata Ltd, London in 1907, then expanded into Airlines and Commercial Vehicles between 1930 and 1950, in 1998 launched the Indica, India's first truly indigenous passenger car for the mass market and in 2000, it acquired the Tetley Group, UK.

The Tata Group is India's best-known industrial group with an estimated turnover of around US $ 14.25 billion (equivalent to 2.6 % of India's GDP). Known for its stick fast to substance to business ethics, it is India's most respected private business group. With more than 220,000 employees across 91 major companies, it is also India's largest employer in the private sector.

Founded by Jamsetji Tata in the 1860s, the Tata Group's early years were inspired by the spirit of nationalism. The Tata Group initiate several firsts in Indian industry: India's first private sector steel mill, first private sector power utility, first luxury hotel chain and first international airline, amongst others. In more recent times, the Tata Group's initiating spirit continues to be showcased by companies like Tata Consultancy Services (TCS), today Asia's largest software and services company, and 4

Tata Motors, the first car maker in a developing country to design and produce a car from the ground up.

The business operations of the Tata Group currently contain seven business sectors Engineering, Materials, Energy, Chemicals, Consumer Products, Services, and Communications and Information Systems. The scale of the Tata Group's operations is increasingly turning global. Tata Tea was the first Indian MNC in the global tea industry; Tata Steel is one of the world's lowest cost producer of steel; Tata Chemicals is one of Asia's largest manufacturer of soda ash; Titan is one of the world's top six manufacturer-brands in the watch segment, and Tata Motors is amongst the top six commercial vehicle manufacturers in the world. The Tata Group is increasingly focusing on new technology areas, and has the largest footprint in the information technology and communication sector in India. Besides being the largest software services provider in the country, it is also one of the leading private sector telecom service providers and is also India's largest international long distance and Internet services provider.

The Tata brand is recognized as the largest homegrown brand in India and the most respected brand. The Tata Group's stable of brands also includes many national and some internationally renowned product and service brands, including Tata Indica, Tata Indigo, Indigo Marina, Tata Safari, Tata Indicom, Taj Group of Hotels (Luxury, Business and Leisure), indiOne, Tata Tea, Tetley, Tata Salt, Tata Steelium, Tata Shaktee, Tata Tiscon, Tata Bearings, Titan, Tanishq, Voltas and Westside. 5

The Tata Group has always believed in returning wealth to the society it serves. Thus, nearly two-thirds of the equity of Tata Sons, the Tata Group's promoter company, is held by philanthropic trusts, which have created a host of national institutions in science and technology, medical research, social studies and the performing arts. The Trusts also provide endowments, grants and programme aid to NGOs in the areas of education, healthcare and social upliftment, and financial assistance to deserving individuals.

By combining ethical values with business acumen, globalization with national interests and core businesses with emerging ones, the Tata Group aims to be the largest and most respected global brand from India whilst fulfilling its long-standing commitment to improving the quality of life of its stakeholders.

THE AIG GROUP

American International Group, Inc. (AIG) is the world's leading international insurance and financial services organization, with operations in approximately 130 countries and jurisdictions. AIG member companies serve commercial, institutional and individual customers through the most extensive worldwide property-casualty and life insurance networks of any insurer. In the United States, AIG is the largest underwriter of commercial and industrial insurance and is one of the top three life insurers. AIG's global businesses also include financial services, retirement savings and asset management. AIG's financial services businesses include aircraft leasing, financial products, trading and market making.

AIG's growing global consumer finance business is led in the United States by American General Finance. AIG also has one of the largest U.S. retirement savings businesses through AIG SunAmerica and AIG VALIC, and is a leader in asset management for the individual and institutional markets, with specialized investment management capabilities in equities, fixed income, alternative investments and real estate. AIG's common stock is listed in the New York Stock Exchange, as well as the stock exchanges in London, Paris, Switzerland and Tokyo.

TATA AIG in India

Tata AIG is India's leading insurance company providing both Life and General Insurance. It represents the trust and soundness of TATA group combined with the international expertise and financial strength of AIG, Inc.The TATA Group holds 74 per cent stake in the TATA AIG life while AIG hold the balance 26 per cent stake.

TATA AIG provides insurance solutions to both individuals and corporates.TATA AIG was licenced to operate in India on Feb. 12,2001 and started operations on april1 2001.TATA AIG offers a broad array of life insurance coverage to both individuals groups with various type of add-ons and options available on basic life products to give consumer flexibility and choice.

History of the Organization

The origin of insurance is very old .The time when we were not even born; man has sought some sort of protection from the unpredictable calamities of the nature. The basic urge in man to secure himself against any form of risk and uncertainty led to the origin of insurance.

The business of life insurance in India in its existing form started in India in the year 1818 with the establishment of the Oriental Life Insurance Company in Calcutta.

Some of the important milestones in the life insurance business in India are:

1912: The Indian Life Assurance Companies Act enacted as the first statute to regulate the life insurance business.

1928: The Indian Insurance Companies Act enacted to enable the government to collect statistical information about both life and non-life insurance businesses.

1938: Earlier legislation consolidated and amended to by the Insurance Act with the objective of protecting the interests of the insuring public.

1956: 245 Indian and foreign insurers and provident societies taken over by the central government and nationalized. LIC formed by an Act of Parliament, viz. LIC Act, 1956, with a capital contribution of Rs. 5 crore from the Government of India.

The General insurance business in India, on the other hand, can trace its roots to the Triton Insurance Company Ltd., the first general insurance company established in the year 1850 in Calcutta by the British.

Some of the important milestones in the general insurance business in India are:

1907: The Indian Mercantile Insurance Ltd. set up, the first company to transact all classes of general insurance business.

1957: General Insurance Council, a wing of the Insurance Association of India, frames a code of conduct for ensuring fair conduct and sound business practices.

1968: The Insurance Act amended to regulate investments and set minimum solvency margins and the Tariff Advisory Committee set up.

1972: The General Insurance Business (Nationalizations) Act, 1972 nationalized the general insurance business in India with effect from 1st January 1973.

107 insurers amalgamated and grouped into four companies viz.

National Insurance Company Ltd.

Oriental Insurance Company Ltd.

New India Assurance Company Ltd.

United India Insurance Company Ltd.

GIC incorporated as a company.

INSURANCE SECTOR REFORMS

In 1993, Malhotra Committee, headed by former Finance Secretary and RBI Governor R.N. Malhotra, was formed to evaluate the Indian insurance industry and recommend its future direction.

The Malhotra committee was set up with the objective of complementing the reforms initiated in the financial sector. The reforms were aimed at creating a more efficient and competitive financial system suitable for the requirements of the economy keeping in mind the structural changes currently underway and recognizing that insurance is an important part of the overall financial system where it was necessary to address the need for similar reforms. In 1994, the committee submitted the report and some of the key recommendations included:

1. Structure

Government stake in the insurance Companies to be brought down to 50%

Government should take over the holdings of GIC and its subsidiaries so that these subsidiaries can act as independent corporations

All the insurance companies should be given greater freedom to operate

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2. Competition

Private Companies with a minimum paid up capital of Rs.1bn should be allowed to enter the industry.

No Company should deal in both Life and General Insurance through a single entity.

Foreign companies may be allowed to enter the industry in collaboration with the domestic companies.

Postal Life Insurance should be allowed to operate in the rural market.

Only one State Level Life Insurance Company should be allowed to operate in each state.

3. Regulatory Body

The Insurance Act should be changed.

An Insurance Regulatory body should be set up.

Controller of Insurance (Currently a part from the Finance Ministry) should be made independent.

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4. Investments

Mandatory Investments of LIC Life Fund in government securities to be reduced from 75% to 50%

GIC and its subsidiaries are not to hold more than 5% in any company (There current holdings to be brought down to this level over a period of time)

5. Customer Service

LIC should pay interest on delays in payments beyond 30 days.

Insurance companies must be encouraged to set up unit linked pension plans.

Computerization of operations and updating of technology to be carried out in the insurance industry.

The committee emphasized that in order to improve the customer services and increase the coverage of the insurance industry, competition. But at the it should be opened up to

same time, the committee felt the need to exercise caution as any failure on the part of new players could ruin the public confidence in the industry.

Hence, it was decided to allow competition in a limited way by stipulating the minimum capital requirement of Rs.100 crores. The committee felt the need to provide greater autonomy to insurance companies in order to improve their performance and 12

enable them to act as independent companies with economic motives. For this purpose, it had proposed setting up an independent regulatory body.

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Problems of the Organization

Service delivery / Logistics perception is weak Negative Environment Top management takes large amount of time to approve high value loan borrowers.

Competitors Information
Life Insurance Corporation of India (LIC)

Life Insurance Corporation of India (LIC) was established on 1 September 1956 to spread the message of life insurance in the country and mobilise peoples savings for nation-building activities. LIC with its central office in Mumbai and seven zonal offices at Mumbai, Calcutta, Delhi, Chennai, Hyderabad, Kanpur and Bhopal, operates through 100 divisional offices in important cities and 2,048 branch offices. LIC has 5.59 lakh active agents spread over the country. The Corporation also transacts business abroad and has offices in Fiji, Mauritius and United Kingdom. LIC is associated with joint ventures abroad in the field of insurance, namely, Ken-India Assurance Company Limited, Nairobi; United Oriental Assurance Company Limited, Kuala Lumpur; and Life Insurance Corporation (International), E.C. Bahrain. It has also entered into an agreement with the Sun Life (UK) for marketing unit linked life insurance and pension policies in U.K.

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In 1995-96, LIC had a total income from premium and investments of $ 5 Billion while GIC recorded a net premium of $ 1.3 Billion. During the last 15 years, LIC's income grew at a healthy average of 10 per cent as against the industry's 6.7 per cent growth in the rest of Asia (3.4 per cent in Europe, 1.4 per cent in the US). LIC has even provided insurance cover to five million people living below the poverty line, with 50 per cent subsidy in the premium rates. LIC's claims settlement ratio at 95 per cent and GIC's at 74 per cent are higher than that of global average of 40 per cent. Compounded annual growth rate for Life insurance business has been 19.22 per cent per annum HDFC Standard Life Insurance Company Ltd. HDFC Standard Life Insurance Company Ltd. is one of Indias 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 Ltd.), Indias leading housing finance institution and The Standard Life Assurance Company, a leading provider of financial services from the United Kingdom. Their cumulative premium income, including the first year premiums and renewal premiums is Rs. 672.3 for the financial year, Apr-Nov 2005. They have managed to cover over 11,00,000 individuals out of which over 3,40,000 lives have been covered through our group business tie-ups. Max New York Life Insurance Co. Ltd. Max New York Life Insurance Company Limited is a joint venture that brings together two large forces - Max India Limited, a multi-business corporate, together 15

with New York Life International, a global expert in life insurance. With their various Products and Riders, there are more than 400 product combinations to choose from. They have a national presence with a network of 57 offices in 37 cities across India. ICICI Prudential Life Insurance Company Ltd. ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank, a premier financial powerhouse and prudential plc, a leading international financial services group headquartered in the United Kingdom. ICICI Prudential was amongst the first private sector insurance companies to begin operations in December 2000 after receiving approval from Insurance Regulatory Development Authority (IRDA). The company has a network of about 56,000 advisors; as well as 7 banc assurance and 150 corporate agent tie-ups. Om Kotak Mahindra Life Insurance Co. Ltd. Kotak Mahindra Old Mutual Life Insurance Ltd. is a joint venture between Kotak Mahindra Bank Ltd. (KMBL), and Old Mutual plc. Birla Sun Life Insurance Company Ltd. Birla Sun Life Insurance Company is a joint venture between Aditya Birla Group and Sun Life financial Services of Canada. Royal Sundaram Alliance Insurance Company Limited The joint venture bringing together Royal & Sun Alliance Insurance and Sundaram Finance Limited started its operations from March 2001. The company is Head Quartered at Chennai, and has two Regional Offices, one at Mumbai and another one at New Delhi. 16

Bajaj Allianz General Insurance Company Limited Bajaj Allianz General Insurance Company Limited is a joint venture between Bajaj Auto Limited and Allianz AG of Germany. Both enjoy a reputation of expertise, stability and strength. Bajaj Allianz General Insurance received the Insurance Regulatory and Development Authority (IRDA) certificate of Registration (R3) on May 2nd, 2001 to conduct General Insurance business (including Health Insurance business) in India. The Company has an authorized and paid up capital of Rs 110 crores. Bajaj Auto holds 74% and the remaining 26% is held by Allianz, AG, Germany. ICICI Lombard General Insurance Company Limited ICICI Lombard General Insurance Company Limited is a joint venture between ICICI Bank Limited and the US-based $ 26 billion Fairfax Financial Holdings Limited. ICICI Bank is India's second largest bank, while Fairfax Financial Holdings is a diversified financial corporate engaged in general insurance, reinsurance, insurance claims management and investment management. Lombard Canada Ltd, a group company of Fairfax Financial Holdings Limited, is one of Canada's oldest property and casualty insurers. ICICI Lombard General Insurance Company received regulatory approvals to commence general insurance business in August 2001.

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S.W.O.T Analysis of TATA AIG Life Insurance

STRENGTHS

Premiums are increasing and so are commissions.

The variety of products is increasing.

Transparency in working is followed.

Fund charges are less i.e. 0.8%

Stronger financial base.

Employee centric organization.

WEAKNESSES

Strong competitors like LIC, ICICI Pru, Birla Sun Life etc.

Premium is priced high as compared top the market leader.

Infrastructure cost is high.

Less expenditure on promotion.

Products not customized for lower segment.

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OPPORTUNITIES

The ability to cross sell financial services barely being tapped.

Technology is improving to the point that paperless transactions are available.

The client's increasing need for an "insurance consultant" can open new ways to service the client and generate income.

THREATS

Government regulations on issues like health care, mold and terrorism can quickly change the direction of insurance.

The increasing expenses and lower profit margins. Intense competition from LIC.

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Objectives of the Study

The purpose of the research is to discover answer to questions through the application of scientific procedure. The main objective of the research is to find out the truth, which is not known and has not been discovered yet The main objectives of the research are: To find out the awareness among the people about the products and services associated with insurance. To study the scope of different schemes & plans of life insurance provided by TATA AIG Insurance. To analyze the customer satisfaction in case of unit linked products TO suggest recommendations after thoroughly analyzing the satisfaction level of customers To overcome weaknesses of the organization by properly understanding the S.W.O.T. analysis of the organization.

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Scope of the Study

The scope of the study is limited to the area of Delhi only, beyond that results may vary and the recommendations given may not be valid.

Also, through this project insurance industry that is prevailing in India and various products and plans of TATA AIG LIFE is been studied. So, it has a wide scope of knowledge and the companies have a scope to use this data and improve their market share and reputation among customers, And can also know the preferences of the customers, their motives to investment in this polices, so as to come up with more customer oriented polices

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Methodology
Descriptive research includes surveys and fact-finding enquiries of different kinds. The major purpose of descriptive research is description of present state of affairs. It is mostly directed towards identifying the various characteristics of research problem and to create observation conducive to further research. This it does by answering the what and why of current state of some systems, that is, it seeks to describe the field or a problem by using questionnaires and opinion Aires. In using such approach, many a times a researcher gains insight into other aspects of the problem which otherwise may not be within the scope of his research per forma.

MEANING OF SAMPLING

Sometimes the researcher simply collects data about certain sociology or psychological characteristics of sample that represents a known population in natural setting. In fact the researcher is interested in knowing about the whole population but rarely he does he study the whole population. The survey so conducted is known as sample survey.

MEANING OF SAMPLING DESIGNS

It is a definite plan to obtain a sample for a given population. This includes the techniques or the procedures, adopted by the researcher in selecting the items form the sample. It is determined before the data is collected. It lays down the number of items to be included in the sample. It is non probability in sampling.

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DATA SOURCES

Whatever may be the type of research design is chosen, it is necessary to collect accurate and reliable data in order to achieve the research objective. All data sources available to the researcher can be classified into primary and secondary data.

PRIMARY DATA

Primary data is the first hand information, which is to be collected at own. For the purpose my research, the objectives are satisfied by preparing questionnaire and by personally interviewing the respondent. Complex information regarding insurance products and the company was taken from company itself.

SECONDARY DATA

Secondary data consists of information that exists somewhere. For the purpose of my research the data regarding insurance products and companies is taken from published materials like magazines and from company brochures and reports

PRIMARY SOURCES:

QUESTIONAIRE

SAMPLE SIZE: 50

SAMPLE DESIGN: NON PROBALITY SAMPLING

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SECONDARY SOURCES:

NEWSPAER

MAGZINES

BROCHURES

COMPANY WEBSITES

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The Insurance Regulatory and Development Authority

Reforms in the Insurance sector were initiated with the passage of the IRDA Bill in Parliament in December 1999. The IRDA since its incorporation as a statutory body in April 2000 has fastidiously stuck to its schedule of framing regulations and registering the private sector insurance companies.

The other decisions taken simultaneously to provide the supporting systems to the insurance sector and in particular the life insurance companies was the launch of the IRDAs online service for issue and renewal of licenses to agents.

The approval of institutions for imparting training to agents has also ensured that the insurance companies would have a trained workforce of insurance agents in place to sell their products, which are expected to be introduced by early next year.

Since being set up as an independent statutory body the IRDA has put in a framework of globally compatible regulations. In the private sector 12 life insurance and 6 general insurance companies have been registered.

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Impact of Liberalization
The introduction of private players in the industry has added to the colors in the dull industry. The initiatives taken by the private players are very competitive and have given immense competition to the on time monopoly of the market LIC. Since the advent of the private players in the market the industry has seen new and innovative steps taken by the players in this sector. The new players have improved the service quality of the insurance. As a result LIC down the years have seen the declining phase in its career.

The market share was distributed among the private players. Though LIC still holds the 75% of the insurance sector but the upcoming natures of these private players are enough to give more competition to LIC in the near future. LIC market share has decreased from 95% (2002-03) to 81 %( 2004-05). The following companies have the rest of the market share of the insurance industry.

NAME OF THE PLAYER

MARKET SHARE (%)

LIC

82.3

ICICI PRUDENTIAL

5.63

BIRLA SUN LIFE

2.56

BAJA ALLIANZ

2.03

SBI LIFE 26

1.80

HDFC STANDARD

1.36

TATA AIG

1.29

MAX NEW YORK

0.90

AVIVA

0.79

OM KOTAK MAHINDRA

0.51

ING VYASA

0.37

AMP SANMAR

0.26

METLIFE

0.21

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Current Scenario of the Industry

INSURANCE MARKET IN INDIA

India with about 200 million middle class household shows a huge untapped potential for players in the insurance industry. Saturation of markets in many developed economies has made the Indian market even more attractive for global insurance majors. The insurance sector in India has come to a position of very high potential and competitiveness in the market.

Innovative products and aggressive distribution have become the say of the day. Indians, have always seen life insurance as a tax saving device, are now suddenly turning to the private sector that are providing them new products and variety for their choice.

Life insurance industry is waiting for a big growth as many Indian and foreign companies are waiting in the line for the green signal to start their operations. The Indian consumer should be ready now because the market is going to give them an array of products, different in price, features and benefits. How the customer is going to make his choice will determine the future of the industry.

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POTENTIAL OF INSURANCE INDUSTRY IN INDIA:

Only ONE out of FIVE insurable populations in India has insurance coverage.

In terms of Insurance premium per capita and premium per GDP, India ranks as one of the lowest in the world.

Life insurance premium constitutes only 9% of domestic savings.

By 2010, hundred million elderly look to planning for old age pension and annuities.

More than 325 million labor forces have no social security.

With an annual growth rate of 15-20% and the largest number of life insurance policies in force, the potential of the Indian insurance industry is huge. Total value of the Indian insurance market (2004-05) is estimated at Rs. 450 billion (US$10 billion). According to government sources, the insurance and banking services' contribution to the country's gross domestic product (GDP) is 7% out of which the gross premium collection forms a significant part. The funds available with the state-owned Life Insurance Corporation (LIC) for investments are 8% of GDP.

Till date, only 20% of the total insurable population of India is covered under various life insurance schemes, the penetration rates of health and other non-life insurances in India is also well below the international level. These facts indicate the of immense growth potential of the insurance sector.

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The year 1999 saw a revolution in the Indian insurance sector, as major structural changes took place with the ending of government monopoly and the passage of the Insurance Regulatory and Development Authority (IRDA) Bill, lifting all entry restrictions for private players and allowing foreign players to enter the market with some limits on direct foreign ownership.

Though, the existing rule says that a foreign partner can hold 26% equity in an insurance company, a proposal to increase this limit to 49% is pending with the government. Since opening up of the insurance sector in 1999, foreign investments of Rs. 8.7 billion have poured into the Indian market and 21 private companies have been granted licenses.

Innovative products, smart marketing, and aggressive distribution have enabled fledgling private insurance companies to sign up Indian customers faster than anyone expected. Indians, who had always seen life insurance as a tax saving device, are now suddenly turning to the private sector and snapping up the new innovative products on offer.

The life insurance industry in India grew by an impressive 36%, with premium income from new business at Rs. 253.43 billion during the fiscal year 2004-2005, braving stiff competition from private insurers. Though the total volume of LIC's business increased in the last fiscal year (2004-2005) compared to the previous one, its market share came down from 87.04 to 78.07%. The 14 private insurers increased their market share from about 13% to about 22% in a year's time. The figures for the first 30

two months of the fiscal year 2005-06 also speak of the growing share of the private insurers. The share of LIC for this period has further come down to 75 percent, while the private players have grabbed over 24 percent.

There are presently 12 general insurance companies with four public sector companies and eight private insurers. According to estimates, private insurance companies collectively have a 10% share of the non-life insurance market.

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Published Stories
October 27th, 2004 - Tata AIG Life half-yearly Total Premium up 118% to Rs 194.3crore October 8th, 2004 - Tata AIG Life announces Star Kid Talent Search with the launch of Star Kid child endowment policy September 28th, 2004 - Tata AIG Life Insurance Company launches Nirvana PLUS August 16th, 2004 - Tata AIG Life Insurance becomes Indias first private life insurance company to launch 24X7 fully automated online renewal premium payment kiosk. July 16th, 2004 - Tata AIG Life expands distribution network: Opens Office in Sikar Establishes state-of-the-art training center for advisors and corporate agents. July 15th, 2004 - Tata AIG enhances distribution channel Ties-up with the Orissa State Co-operative Bank for Banc assurance. July 2nd, 2004 - Tata AIG Life Insurance to insure Sara swat Banks Home Loans June 25th, 2004 - Tata AIGs Green Channel Settlement to make accident repairs and claims easier than never before.

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Tata AIG Life wins LOMA award for outstanding professional development of employees

Tata AIG Life Insurance Companys Total Premium increases by 253 % to Rs 254 crores over 1,60,000 new individual lives insured during FY 2003-2004

Tata AIG Life Insurance Company ties-up with India times SMS 8888 Tata AIG launches a unique Unit Linked Insurance Plan - Invest Assure TATA AIG expands its distribution network: launches branch in Lucknow TATA AIG Life Insurance and United Bank of India enter into Banc assurance partnership

TATA AIG Life expands distribution network; launches office in Jodhpur Tata AIG Life expands distribution network; launches second office in Jaipur TATA AIG Life Insurance Company Limited launches Unit Linked Insurance Plans for Superannuation and Gratuity

Tata AIG General reports premium income at Rs. 353 crores and maiden profit of Rs. 15 crores.

Tata AIG launches Health First TATA AIG Life total sum assured up 239% to Rs 5321 crore from 1570 crore

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Product Profile
LIFE INSURANCE FOR CHILDREN

1) MahaLife Gold

A TATA AIG MAHA Life policy presents a very tangible, very safe investment to help your child through life. And the best part is, you only pay premiums for the first 15 years after which your child gets an income as well as insurance cover for the rest of her life. This policy can also be bought as retirement planning for your self

What's the benefit did the customer get?

The star benefit with MahaLife Gold is our guaranteed 5 percent coupon (on the sum assured) every year for the rest of the insureds life from the 10th year of the policy. This is in addition to the sum assured that you get at the end of the policy. Apart from this, you also get non-guaranteed cash dividends from the 6th year onwards, depending on company performance.

Extra benefits?

On death or at maturity at age 100, your entire sum assured will be paid tax-free.

Tax Benefits, Riders and Age eligibility

1. Both, the guaranteed 5 percent and the non-guaranteed cash dividends are tax free. 34

2. Premiums paid are eligible for tax benefits under Section 88.

3. Attach Disability, Accident, and Term and Critical Illness riders to this policy for added protection.

4. Of course, your child has to be at least 30 days old to qualify. Older people can buy this too (at a maximum age of 60 years) as a high earning retirement plan.

2) Assure Educare Every parent knows a childs dreams are always changing, but when your child finally decides on one of them, you will be expected to have the financial means to make those dreams come true. Tata AIG presents Assure Educare so your childs dreams are safe. Educare is an endowment policy specially designed to give your child the education he or she wants. And you can choose from two plans: Educare 18: This plan matures when your child turns 18 and is open to children between 30 days and 8 years of age. Educare 21: This plan matures when your child turns 21, and is open to children between 30 days and 11 years of age.

What's the benefit did the customer get?

Educare is a first-of-its-kind juvenile policy that guarantees payment of 10 percent of the sum assured at maturity or on death (policy must be in force for a minimum 10 35

years). In addition, it guarantees an education benefit of 20 percent of sum assured which will be paid to you at maturity.

Which means, we guarantee you will get a total of 30 percent of the sum assured at maturity in addition to what is due to you?

And what are the extras?

To top all this, extras like our Reversionary and Terminal bonuses add up to a very attractive package. A compounded annual bonus, declared by the company, will be credited to the policy on the policy anniversary.

Based on the total accrued reversionary bonus, a terminal bonus is payable on death or maturity (policy must be in force for a minimum 10 years).

Both these bonuses are non-guaranteed and depend on the performance of the company.

Also, Educare is supported by a money-back guarantee, so if you change your mind, you simply return the policy document within 15 days of receipt and your premiums will be refunded with nominal administrative charges deducted

Tax Benefits, Riders and Age eligibility

Premiums paid for this policy are eligible for tax returns as per current Income Tax rules. You can attach the Payor Benefit Rider which waives off all future payments for this policy in the event of your unfortunate death. Educare 18 is open to children 36

between 30 days and 8 years of age, while Educare 21 is open to children between 30 days and 11 years of age.

3) Assure Career Builder Your childs education and career are the two most important concerns in your life. And in these increasingly competitive times, to provide for both of them you need Tata AIGs Assure Career Builder, a juvenile money-back insurance product designed to take care of all the big decisions in your childs life.

What the benefit did the customer get?

Career Builder is a money-back policy that provides financial assistance at various stages of your childs life, from education to the big leap into a career. Essentially, the policy pays you a lump sum of money at various stages of your childs life 20 percent of sum assured on your childs 18th birthday, 20 percent on the 21st birthday, 20 percent on the 24th birthday and the remaining 40 percent at the policy maturity at your childs 27th birthday.

All the periodic payments against this policy do not affect the full payment of the sum assured in case of the insureds death.

Also, a guaranteed addition of 10 percent of the sum assured will be paid at the time of maturity or death (policy must be in force for a minimum 10 years).

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And what are the extras?

To top all this, extras like our Reversionary and Terminal bonuses add up to a very attractive package. A compound reversionary bonus, as declared by the company will be credited to the policy on the policy anniversary. Based on the total accrued reversionary bonus, a terminal bonus is payable on death or maturity (policy must be in force for a minimum 10 years). Both these bonuses are non-guaranteed and depend on the performance of the company.

Also, Career Builder is supported by a money-back guarantee, so if you change your mind, you simply return the policy document within 15 days of receipt and your premiums will be refunded with nominal administrative charges deducted.

Tax Benefits, Riders and Age eligibility

Premiums paid for this policy are eligible for tax returns as per current Income Tax rules.

You can attach the Payor Benefit Rider which waives off all future payments for this policy in the event of your unfortunate death.

Minimum entry age is 30 days, while maximum is 15 years. The policy matures at age 27.

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Life Insurance for Adults

Tata AIG Invest Assure

When it comes to choosing insurance, the primary aim of most people is to secure a financial cover in the event of misfortune. Now a part of the premiums you pay is also invested, and based on fund performance you receive a bonus from your insurance company every year. However you have no control or choice in what kind of instruments the company invests in. So even if your premium could earn you more dividends by, say, investing in equities, the company may not choose to invest in that category of funds.

From serving millions of customers across the world, Tata AIG has learnt that, given a choice, many people would like to increase the earning potential of their insurance premium by deciding their own investment and risk limits.

Answering this need, Tata AIG Life Insurance Company Ltd. (Tata AIG) introduces Invest Assure, a unique flexible insurance plan which combines the security of a life insurance policy with the opportunity of enjoying high returns on your insurance premium. An ideal investment in these changing times, it gives you the opportunity to exploit the upside of market returns, with, however increased investment volatility but does not compromise on the security that you want to provide your loved ones.

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1) Assure 21 Years Money Saver

For anyone looking for an attractive savings plan - this product gives you money at regular intervals - both for your child's needs at various critical milestones, as well as for your own financial obligations. Whats the benefit did the customer get?

Tata AIG's Assure 21 Years Money Saver plan gives you the dual benefit of life cover plus the flexibility of periodic withdrawals - you get back 10 percent of the sum assured every three years for the next 21 years, with the balance on maturity of the policy.

Alternatively, you can reinvest these returns with Tata AIG at a competitive interest rate.

And what are the extras?

If you live past the 21 years of the policy, you get the remaining 40 percent of the sum assured on the 21st Anniversary. In case of death before the end of the term, you still get the entire sum assured irrespective of the withdrawals made before death.

Plus you get a 10 percent Guaranteed Addition after ten years of the policy.

You also share in the company's profits in the form of both reversionary and terminal bonus paid on maturity. (Terminal Bonus is available only if policy is in force for more than 10 years). 40

Tax Benefits, Riders and Age eligibility

Premiums paid are eligible for tax benefits under Section 88.You can attach the Payor Benefit Rider which waives off all future payments for this policy in the event of your unfortunate death. You can add our Term, Critical Illness (not for juveniles), Accident and Disability riders to this policy for added protection. Minimum age to qualify for this product is 30 days. Maximum age limit is 55 years.

2) Assure Lifeline
You are always there for your family - but what if something should happen to you? Your family will still have to pay off that housing loan. Your child will still need to finish college. Tata AIG's term policies bring you the promise of value-for-money insurance.

This policy allows you the luxury of high coverage at a very affordable cost. Should anything happen to you, your family can still maintain the lifestyle you have given them all this while. The big plus with our term plans is you can convert them to any of our select savings plans. And our one and five-year plans are renewable without the need for a medical test.

Tax Benefits, Riders and Age eligibility

Premiums paid are eligible for tax benefits under Section 88.You can of course add our Accident Benefit rider to the basic cover for added protection. Minimum age to qualify for this product is 18 years. 41

Tenures Assure Lifeline Plus is available for 1, 5, 10, 15, 20, 25 years or till 60 years of age

3) Life Plus
Imagine life insurance that not only covers you, it also returns all your premium payments if you outlive the policy. So either way, you win - with our 20-year Life Plus policy.

Get covered for 20 years

This policy covers you for 20 years. In case death occurs due to natural causes, we give you the sum assured. In case of death due to accidental causes, we give you double the sum assured. Of course, if you live past the tenure of the policy, we return all the premium payments you have made.

In case you outlive your policy, at the end of 20 years it returns all the premiums you paid (without interest).

With a term of 20 years and a premium paying period of 15 years, it essentially means you get five extra years of life cover for no extra premium at all.

Tax Benefits, Riders and Age eligibility

Premiums paid are eligible for tax benefits under Section 88.You can of course add an Accidental Dismemberment rider to your basic cover for added protection.You have to be between 18 and 60 years of age to qualify for this product. 42

4) Assure Security & Growth

Putting something aside for the future is fine but you also want your money to grow, don't you? Most times, either your money is safe, or it grows. You don't get both. So Tata AIG has come up with an Endowment policy giving you safety and returns. You can also buy this product as an endowment at age 60, as wise retirement planning.

This policy is also available for a term up to age 60 years - our Assure Golden Years Plan - if you want a retirement kitty and you plan to stop working at age 60.

So in case of death, your dependants get the sum assured. Otherwise your savings grow, because if you live past the term you still get that sum assured along with a whole host of bonuses

A guaranteed 10 per cent bonus (on the sum assured) after the 10th policy anniversary.

Reversionary bonus projected at an annual 5 per cent (compounded).And a Terminal bonus paid on maturity or death (policy must be in force for a minimum 10 years).Reversionary and Terminal bonuses are non-guaranteed and depend on the performance of the company.

Tax Benefits, Riders and Age eligibility

Premiums paid are eligible for tax benefits under Section 88.And you can attach Term, Accident and Disability riders to this policy for added protection.The duration of the policy can be 10, 20 or 30 years. For a 10-year plan, you have to be between 18 and 65

43

years of age. (18-55 years for a 20-year plan, 18-45 years for a 30-year plan and 18-50 years for a plan of age up to 60).

5) Tata AIG Health First

Any hospital stay you can think of is avoidable at best. And whether it was for surgery or an illness, the hospital and medicine costs are what you will remember long after the experience.

For hopeful patients in sterile hospital rooms, Tata AIG brings you a touch of warmth. Health First is India's first comprehensive hospital allowance policy covering prolonged hospitalization, major surgery, critical illness, post hospitalization fees and even the unfortunate event of your death.

Why Health first is the best you can buy

This policy can be claimed simultaneously with your existing medical insurance policy.

While other medical policies only reimburse you for actual medical expenses, we give you a lump sum irrespective of what your bills are.

The other innovative feature of this policy is that it is renewable till age 65 without any further medical examination with premiums increasing only once every five years.

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What Health first has for you

Hospitalization Allowance (HA)*: During hospitalization, we pay you an allowance of up to Rs.2, 500 per day depending on the number of units you buy. The allowance is available only after the first three days of hospitalization for a maximum of 90 days of confinement for the same or similar cause. There is a waiting period of 90 days before this cover begins.

Surgical Benefit: A lump sum of up to Rs.125, 000 is paid for any surgical procedure. And remember - we pay the complete amount you purchased even if your operation actually cost you less. This amount is in addition to your HA, but is payable only if HA is payable.

Critical Illness Cover: Do you have anything to protect yourself from the heavy financial impact of a critical illness? Our policy gives you up to Rs.12.50 lakhs for just such an impact. There is a waiting period of 180 days before this cover begins and claims can be made only once for the same critical illness.

Post Hospitalization Benefit: After hospitalization, you get up to Rs.1, 250 a day for follow-up treatment, for a maximum of 3 days.

Lifetime Maximum Cover: You can make multiple claims up to a maximum of Rs.25 lakhs (for 10 units) during the tenure of this policy. So if you claim for 2 Critical Illnesses of Rs.12.50 lakhs each, your lifetime cover will be exhausted and your policy will terminate. And of course, you have the option of buying anywhere between one and 10 units, depending on the kind of coverage you want. 45

Tax Benefits, Riders and Age eligibility

Premiums you pay for medical cover are eligible for tax benefits u/s 80D.

Remember, you have to be aged between 18 and 60 years to qualify. Also - for eligibility for any of these benefits, your treatment has to occur only at our preapproved list of hospitals.

Confinement means admission in a Hospital as an in-patient for a minimum period of twenty-four consecutive (24) hours upon the recommendation of a Physician and continuously stay in the Hospital prior to his discharge.

Same Confinement means that if two or more Confinements are due to the same or related Injury or illness, or to any complications arising there from, such Confinements shall be regarded as one Confinement if each of them is not separated by more than 90 days from the paid or payable Confinement which immediately precedes it. This rule shall be observed in determining the limit of the benefits.

Hospital shall refer exclusively to an institution providing treatment in the system of western medicine (allopathy) which is an institution

Duly licensed and registered as a Hospital with the appropriate local authorities and operated pursuant to law for the care and treatment of sick and injured persons as registered in- patients, fully equipped with facilities for diagnosis and major surgery which are under the constant supervision of one or more

46

Registered Medical Practitioners, and which have 24-hour a day full time professional nursing services; And

Maintains proper medical and patient records to the standards as required under the prevailing laws and regulations in the geographical area it is located; And

Maintains appropriate quality for delivery of health care to the standards as required under the prevailing laws and regulations in the geographical area it is located; AND pre-approved by the Company. The Company shall maintain and publish a list of pre-approved hospitals for this purpose, and has the sole discretion to determine if a hospital shall be included in the pre-approved list and to revise this list, from time to time.

"Hospital" does not include any institution or that portion of any institution, which is operated as a convalescent or rest home, a hotel, a home for the aged, a place for alcoholics or drug addicts, or Custodial Care, or for any similar purpose.

Covered Injury means "injury" occurring after the Issue Date, Commencement Date or last reinstatement of the Policy, whichever is later. "Injury" means an abnormal bodily condition of the Insured, which occurs while this Policy is in force and within 90 days of Accident, and caused directly and solely by Accident independent of any other cause and therefore due to illness or disease. Such injury must be evidenced external signs such as contusion, bruise and wound except in cases of drowning and internal injury. 47

Covered Illness means illness occurring more than ninety (90) days after the Issue Date or Commencement Date or last reinstatement, whichever is later, of this Policy. For this purpose, an illness has occurred when it has been investigated, diagnosed or treated or when its signs or symptoms have manifested which will cause an ordinary prudent person to seek diagnosis, care or treatment. In the event of any conflict or discrepancy of opinions relating to the signs or symptoms of an illness and their manifestation between a Physician/Registered Medical Practitioner and the Insured, we will adopt and follow the Physician/Registered Medical Practitioner's professional opinion.

6) Nirvana Plus
Imagine a real alternative to the crowd of regular retirement plans offered in the market. A plan that gives you exceptional value for the rupees you are setting aside as nest egg. That plan is Nirvana Plus. Nirvana Plus, from Tata AIG Life Insurance Company, is Indias first and only pension policy with a guaranteed addition of 10 percent of sum assured every 5 years. You can choose from three levels of cover, which is your amount of Sum Assured: Rs.1lakh, Rs.2 lakhs and Rs.4 lakhs and also decide the age you want to retire 55, 58 or 60 years of age.

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Additions to your Sum Assured - Guaranteed!

For every five years that you pay premiums, Nirvana plus Pension Policy adds 10% to your Sum Assured. Tata AIG is the only company in India that gives you these Guaranteed Additions!

For e.g.: You get additions of up to 70 percent over and above your chosen level of benefit, depending on the age you start. For example, if you are a 25 year old choosing to retire at age 60 with the Platinum Plan, you will earn a sum of Rs.40,000 seven times over, (which is for every five years that you are invested in the plan) and will accumulate a total of Rs.2,80,000.

Critically ill in the next 3 years? You are taken care of - Guaranteed! If you are diagnosed with a covered critical illness in the first three years of the plan, Rs.1lakh will be paid directly to you (after a 30 day survival period). You can use this money for anything from getting hired help to look after you, or for an ocean side holiday to help your recuperate.

For e.g.: With Nirvana Plus you can avail of this benefit 180 days after you sign up. The critical illnesses covered under this policy include cancer, stroke, heart attack, coronary artery bypass graft surgery, kidney failure and major organ (heart / liver / kidney) transplant. Please refer to the policy document for definitions of critical illnesses covered. The premium will be based on attained age and the rider premium rates as applicable then. This rider will, however, be available only if not claimed earlier. 49

Life cover - Guaranteed!

In case of loss of life during the period of the policy, your beneficiary will get the full Sum Assured + Guaranteed Additions + Bonuses (if any) immediately. Which means with Nirvana Plus, you are not only planning for retirement you are also insuring your life.

In case of loss of life by accident, you will get double the Sum Assured Guaranteed!

In case of loss of life by accident during the plan period, your beneficiary directly gets double the Sum Assured + Guaranteed Additions + Bonuses (if any). This way, you ensure that your loved ones are looked after even when you are not around.

Cash paid lump sum upon retirement - Guaranteed!

On your chosen retirement age, Nirvana Plus pays you up to one third of your Sum Assured as lump sum cash. Whats more, as per current Income Tax laws, this benefit is absolutely tax-free! This way, you can pay for your childs wedding or even pursue a vocational education. The balance amount of your retirement fund is used to buy you a monthly income plan that will generate a monthly cash income. Tata AIGs profits over the years shared when you retire

With Nirvana Plus you are ready for the unpredictable expenses of old age with reversionary and terminal bonuses credited to your policy. Reversionary bonus will be credited from the 6th policy anniversary onwards, and Terminal bonus will be paid 50

upon maturity or death after ten years. These bonuses are based on the companys performance.

No medical test needed - Guaranteed!

If you are between 18 and 45 years of age, no medical examination is required. Just sign a simple health declaration to become eligible.

Other Benefits

You can also avail of a host of other benefits like grace period for payment of annual premium, automatic premium loan, re-instatement of policy and paid-up value policy. The details are mentioned in your policy contract. You are also entitled to guaranteed surrender value, which refers to guaranteed cash value of the policy = 30 percent of total premium paid, excluding the 1st year of premium, provided the premium has been paid for at least 3 consecutive years.

Tax Benefits, Riders and Age eligibility (as per current tax laws)

You can avail of tax benefits u/s 80 CCC on your premium payments, irrespective of your income level. If you wish to continue critical illness cover after 3 years, it will be available as an optional rider subject to evidence of health and payment of additional premium. You have to be between 18 and 45 years of age to qualify for this product.

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Some benefits are guaranteed and some benefits are variable with returns based on the future performance of your Life Insurance Company (Tata AIG).

If your policy offers guaranteed returns then these will be clearly marked "guaranteed" in the illustration table on this page.

If your policy offers variable returns then the illustrations on this page will show two different rates of assumed future investment returns.

These assumed rates of return are not guaranteed and they are not the upper or lower limits of what you might get back, as the value of your policy is dependent on a number of factors including future investment performance. 52

The above bonus illustrations in columns D & E have been determined using assumed future investment return of 10% & 6% respectively. The rates used have been set by the Life Insurance Council.

The bonus rates corresponding to 10% and 6% are 6.8% and 3.4% respectively.

Terminal Bonus is projected at 30% of Reversionary Bonus.

The amounts that you have to pay, as mentioned in the above table, are calculated assuming the annual premium payment mode.

NB: GA-Guaranteed Addition, B-Bonus, SB-Special Bonus

Monthly premium for retirement age of 60 years

You can choose your retirement age - 55, 58 or 60 years.

Quarterly, Semi-Annual and Annual payment options also available

Monthly Premium = 0.0883 of Annual Premium;

Quarterly Premium = 0.26 of Annual Premium;

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Semi-Annual Premium = 0.51 of Annual Premium.

The minimum and maximum premiums depend on your age and sum assured and is from Rs. 3,570 annual premium upwards.

7) Assure Golden Year

Putting something aside for the future is fine but you also want your money to grow, don't you? Most times, either your money is safe, or it grows. You don't get both. So Tata AIG has come up with an Endowment policy giving you safety and returns.

So in case of death, your dependants get the sum assured. Otherwise your savings grow, because if you live past the term you still get that sum assured along with a whole host of bonuses.

A guaranteed 10 per cent bonus (on the sum assured) after the 10th policy anniversary.

Reversionary bonus projected at an annual 5 per cent (compounded).

And a Terminal bonus paid on maturity or death (policy must be in force for a minimum 10 years

Besides these, there are some more insurance products like

Special Life Plus

Raksha 25

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Raksha 20

Raksha 15

Raksha 10

And some of the Riders are as follows:

ADD

ADB (Accident Death Benefit)

CRITICAL ILLNESS

PAYORS BENEFIT Below 18 Years

TERM RIDERS

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Analysis of Data
Points in Favor of TATA AIG LIFE Good Market Penetration i. As seen from the data obtained TATA AIG LIFE has good market penetration for a relatively new company with more than 20% of people having its policy. Satisfactory Knowledge about product i. Knowledge about TATA AIG LIFE product is quite good in the market with a majority telling about the products offered by TATA AIG LIFE. Good Solicitation rate i. About 1/3 of the respondents have been solicited by TATA AIG LIFE advisors .This concludes that work put up by advisors is appreciable. Have got good scaling from those who have TATA AIG LIFE product i. More than half of those who have a TATA AIG LIFE policy have scaled it in the region of 3+ range shows its popularity among the people. Majority of Policyholders satisfied i. More than 90% of policyholders are satisfied with the product, a phenomena which augurs well for the company.

Advisors good at convincing People

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i.

Advisors presentation is one of the clinching factors while deciding the policy. A point which again vindicate the advisors.

Chances of new prospects HIGH i. Both the existing and non-existing policyholders are showing a keen interest in the company.

Those who dont have policy majority cited Already have one as reason i. This shows that supposed or actual inferiority of TATA AIG LIFE product do not have a big hand in people selecting other policy over TATA AIG LIFE.

Even those who dont have policy would like to be our customer i. A welcoming trend which means that there are chances of increased customer base for TATA AIG LIFE.

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Points against TATA AIG LIFE

Unsolicited persons number high The respondents unsolicited by TATA AIG LIFE advisors is still high, a point which is not in the favor of a new company.

TATA AIG LIFE regarded as average by most number of people Most of the people have put TATA AIG LIFE in 3-4 category which means that it is being viewed as an average company by the people

Group policy does not have many customers Group policy provided by is not popular nor is taken by a good number of people. Steps should be taken in this regard.

Individual Attention is not given to everybody Lack of individual attention is cited as one of the reasons mentioned by many of the people.

People are unaware about special feature of TATA AIG LIFE People both policyholders and non-policyholders do not have much information about the special features of TATA AIG LIFE, which essentially demarcates TATA AIG LIFE from other companies.

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Those who dont have our policy majority ranked TATA AIG LIFE lower than competitor People who do not have our policy have rated lower TATA AIG LIFE than other competitors.

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CHAPTER 3 DATA ANALYSIS AND INTERPRETATION 1. Are you aware of TATA AIG LIFE Insurance Company?

70 60 50 40
Yes No

30
20 10 0

Interpretation This question was asked to determine awareness about TATA AIG among the people. 42% replied in positive while remaining 58% replied in negative

2. What kinds of products do you think TATA AIG LIFE provide? Individual life insurance Group insurance Children policy Retirement benefits 60

All of the above

Knowledge about TATA AIG products

Individual

Group

Children

Retirement

All of above

Interpretation This question was asked to determine people knowledge about TATA AIG

products.35% of people are aware of the individual life insurance,10%are aware of the group insurance,20% aware of children policy,15% aware of retirement benefits and 20% said all of the above.

3. Have you ever been solicited by TATA AIG LIFE advisor?

61

Yes No

Interpretation This question was asked to determine solicitation by TATA AIG advisors.30% replied in positive while 70% replied in negative.

4.Do you have a policy of TATA AIG LIFE? Yes No

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Policyholder

Yes No

Interpretation This question was asked to people whether they have a TATA AIG LIFE policy 22% replied in positive while 78% replied in negative

For those who answered YES,

1.What policy you have? Individual life insurance Group insurance Children policy Retirement benefits

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Kind of Policy

Individual life

Group

Children

Retirement

Interpretation This question was asked to determine what policy they have, if have any. 40% said they had individual life insurance,12% said they had group insurance, 25% said they had children policy ,and remaining 23% said they had got retirement benefits.

2. How would you rate it on a scale of 5?

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Rating

0-1 1-2 4-5 2-3

3-4

Interpretation This question was asked to determine how people rate insurance products owned by them. 10% of people rate their products in 0-1 category,8% rate it in 1-2 category,27% rate it 2-3 category,25% rate it In 3-4 and 20% rate it in4-5 category.

3. Are you satisfied with the product? Yes No

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Product popularity

No Yes

Interpretation This question was asked to determine whether people are satisfied with policies.90% of people replied in positive while remaining 10% remained unsatisfied.

4.What distinguishing feature do you find in TATA AIG LIFE? Better service Individual attention Claim settlement Superior products

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Feature

better service Claim settlement

Individual attention Superior products

Interpretation This question was to determine what special feature people find in TATA AIG LIFE. 32% said its services,16% said its policy of paying individual attention,32% said its hassle free claim settlement feature while remaining 20% said its products are better than competitors.

5.Why you took a TATA AIG LIFE policy? Advisor presentation Friends advice Your own judgment

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Reason for buying TATA AIG product

Advisor Friend Own judgement

Interpretation This question was to determine what factors made them buy the products. 60% of them it was advisor presentation,18% said it was their friend advice while remaining 22% said it was their own judgment.

6.Would you take another TATA AIG LIFE policy? Yes No

Possibiltyof new purchase

Yes No

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Interpretation This question was asked to people if they would like to buy another insurance policy. 65% replied in positive while remaining 35% said no.

For those who answered NO,

1.Why did not you take TATA AIG LIFE policy? Already had one Have no information about TATA AIG LIFE Nobody approached me Dont like TATA AIG LIFE products
Reasons for not buying TATA AIG products

already had one no information nobody approached me don't like TATA AIG products

Interpretation This question was to people to determine why they dont have TATA AIG LIFE policy. 50% of them said because they already had one, 20% said they dont have 69

any information about TATA AIG LIFE, 18% said nobody approached them, while remaining 12% said they dislike TATA AIG LIFE.

2.Do you think other company products are better? Yes No Cant say

Yes No Can't say

Interpretation This question was to determine how people rate TATA AIG LIFE products in comparison to its competitors.30% said its competitors products are better,17% said no this is not true, while remaining 53% are not abled to say anything

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CHAPTER - IV SUMMARRY AND CONCLUSION Result of the Study

TATA AIG LIFE has market penetration and awareness about it is high in the market. But it can take following steps to even better itself:

Increase number of people solicited by TATA AIG LIF o Since TATA AIG LIFE is a new company it should strive to increase its solicitation rate

Create awareness in people about high quality standards which TATA AIG LIFE possess o People should be made aware of high quality standards adopted by the TATA AIG LIFE, especially that the fact that it is the only company authorized by IRDA to have in-house training for aspiring advisors.

Popularize Group Policy o Group policy must be advertised as awareness about it is quite less among people.

Give personal attention to customer o Personal attention must be provided to all as it is cited as one of the deficiencies of TATA AIG LIFE. 71

 Advertise about TATA AIG LIFE special feature o TATA AIG LIFE special features should be well advertised to ensure that people know what set TATA AIG LIFE apart from its competitors.

Bank upon those people who might take TATA AIG LIFE policy o TATA AIG LIFE should ensure that those who have shown willingness towards taking its policy should be contacted and banked upon.

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Findings and Recommendations

Findings: The products and services being offered by the TATA AIG have been carefully developed, over the years, after studying the nitty gritties of the Indian market. The TATA AIG offers a wide range of products and services to meet the requirements of varied customers, as customer satisfaction is their prime concern. They aim at making insurance convenient for their customers by offering services like AIG Insurance, Education Insurance, Health Insurance and so on. Each service / product, offered by the TATA AIG is designed for a particular market segment. The main focus of the TATA AIG in the present scenario is to target only the urban class of customers. The need of the hour is to shift the focus to the rural class in order to meet the competition and expand the customer base. Recommendations The target market should be broadened.

The company should increase their policy holders.

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Give the old customers some sort of incentives if they introduce a new customer to the Insurance sector. The numbers of branch are very less and not cover a large group of area.

The company should the new plans and polices for the upcoming or the future customers.

The company should make a particular sector as a target, which they have to achieve within a specified period.

The company should improve their lifetime common features.

The insurance plans and policies must be flexible in nature and it should not be rigid one.

The company should introduce the new plans for the children as well as for the oldest people.

The company should focus on the urban as well as on the rural areas.

The company should try to provide its plans and policies at competitive prices

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BIBLIOGRAPHY

Books Kothari, C.R, Research Metholodgy,6th edition,2000,Vikas publishing House Pvt. Ltd, New Delhi. 5thedition,

Malhotra,

K,

Marketing

Research,

2007,

Dorling

Kindersley(India) Pvt. Ltd Gupta, C.B ,Insurance and Banking, 4th edition,2000, Mayurbacks Paper Pvt. Ltd, Noida

Websites

www.tata-aig.com

www.tata-aig-life.com/Individual/solutionIndividual.htm

www.tata-aig-life.com/Individual/Adult/adultInvestAssure%20Flexi.htm

www.tata-aig-life.com/Individual/Adult/adultMahaLifeGold.htm

www.tata-aig-life.com/Individual/Retirement/retirementNirvanaPlus.htm

www.tata-aig-life.com/Individual/Adult/retirementAssureGoldenYears.htm

Broachers

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Induction manuals of TATA AIG Life Insurance

Broachers and pamphlets of TATA AIG Life Insurance.

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Questionnaire

Personal Details Name: Address: Gender: Occupation: Age: 0-15 _____ 25-50 _____ 50-70 _____

15-25 _____

1.

Are you aware of TATA AIG Life Insurance company? Yes No

2.

What Kinds of products do you think TATA AIG LIFE provide? Individual life insurance Group insurance Children policy Retirement benefits All of the above

3.

Have you ever been solicited by TATA AIG LIFE advisor? Yes 77

No

4. Do you have a policy of TATA AIG LIFE? Yes No

For those who answered YES, 1.What policy you have? Individual life insurance Group insurance Children policy Retirement benefits

2. How would you rate it on a scale of 5? 0-1 1-2 2-3 3-4 4-5

3. Are you satisfied with the product? Yes No

4. What distinguishing feature do you find in TATA AIG LIFE? 78

Better service Individual attention Claim settlement Superior product

5. Why you took a TATA AIG LIFE policy? Advisor presentation Friends advice Your own judgment

5. Would you take another TATA AIG LIFE policy? Yes No

For those who answered NO, 1. Why did you not take TATA AIG policy? Already had one Have no information about TATA AIG LIFE Insurance Nobody approached me Dont like TATA AIG LIFE products

2. Do you think other company products are better? Yes No Cant say 79

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