A Project Report

On

CHANNEL DEVELOPMENT IN
RELIANCE LIFE INSURANCE

Summer Training Report Submitted in

The partial fulfillment of
Master of Business Administration of
Session 2009-10

Submitted by: Under guidance of

BIPIN SINGH SIKHA AGRAWAL

MBA –III Sem Faculty of MBA Deprt.
Roll No. –0914170013

SAGAR INSTITUTE OF TECHNOLOGY &

MANAGEMENT BARABANKI
 CONTENT

➢ Preface 5

➢ Declaration 6

➢ Acknowledgement 8

➢ Abstract 9

➢ Company Profile: 11

 Reliance Insurance

➢ Introduction of study 47

➢ Objective of study 66

➢ Research Methodology 68

 Research variable

 Research design

 Sample and Sampling Size

➢ Data Representation, Analysis & Interpretations 72

➢ Results 81

➢ Limitations 84

➢ Conclusion 85

➢ Recommendations 85

➢ Questionnaire 89

➢ Bibliography 93
 CERTIFICATE

This is certify that BIPIN SINGH student of MBA II Year, SAGAR INSTITUTE OF

TECHNOLOGY & MANAGEMENT BARABANKI, has undergone a research report on “

CHANNEL DEVELOPMENT IN RELIANCE LIFE INSURANCE” and has submitted a

report the based same as mandatory requirement of the degree of Master of business

Administration, U.P Technical University Lucknow.

(SIKHA AGRAWAL) Date

(SAGAR INSTITUTE OF TECHNOLOGY & MANAGEMENT)

PREFACE
The business of insurance is related to the protection of economic value of

assets. The assets would have been created through the efforts of the owner,

in the expectation that, either through the income generated there from the

some other output, some of his needs would be met. If assets get lost earlier,

being destroyed or made non-functional, through an accident or other

unfortunate event, the owner and those deriving benefits there from suffer.

Insurance is a mechanism that helps to reduce such adverse consequences.

Insurance plays a major role in different perspective. For economic

development investments are necessary. Investments are made out of savings.

A life insurance company is a major investment for the mobilization of

saving of people, particularly from the middle and lower income groups.

These savings are channeled in to the investments for economic growth. In

order to amenable to statistical predictions, insurance risks must be handled

on a large scale.

All organization face change in their environment with resultant change in

their markets and in the ability to satisfy their markets. Each organization is

faced with new marketing problems and opportunities in their existing and

potential market. Marketing decision makers cope with these challenges in a

variety of ways. The marketer’s is being required to forecast, forecast the

risk and uncertainness in their own way, supported by market research.

Man on earth can entirely eliminate knows no method but scientific method

can minimize the element of uncertainties that can result from back of

information without orientation, Market research is a process of collecting information

about who, why and how of actual and potential consumers in a particular mark .
 STUDENT DECLARATION

I, BIPIN SINGH undersigned here declare that the project titled “CHANNEL

DEVELOPMENT IN RELIANCE LIFE INSURANCE” is my own work and efforts

which is completed under the supervision of SIKHA AGRAWAL.

BIPIN SINGH

Roll No. – 0914170013

M.B.A. III Sem

Acknowledgement

ACKNOWLEDGEMENT

I would like to take this opportunity to express my deep gratitude to all those who, directly

or indirectly made this project possible. I have got considerable help and support in making

this project report a reality from many people.

I would like to thank Mr. Rahul Srivastava (Senior Sales Manager), Reliance Insurance

Co. Ltd., Lucknow whose great help and proper guidance helped me in completing this
project. This work is the reflection of his thought, ideas, concept and above all his modest

effort.

I would also like to say thanks to Sikha Agrawal for their constant suggestion which have

resulted in successful completion of the project.

( BIPIN SINGH)

ABSTRACT

Background of the work assigned:

During Summer Internship Program following three projects have been assigned:

1. Personal Financial Planning at Reliance life insurance- Purely the marketing project.

2. Financial Consultants Recruitment- Mix of Human Resource Planning &

Marketing.

3. Comparative analysis of Reliance life insurance product with other major

competitors: Totally a research study.

First two are the basic two phases of insurance around which this whole insurance roams.

The objective of the projects so assigned is to get me in depth knowledge about the insurance

terms and policies and to know the customer behavior and the corporate environment of

insurance.

To get the in depth knowledge about Reliance life insurance that where it is providing better than

the market and to have an understanding of the insurance market. Moreover, training has

been provided to understand the share market and to know that how this share market works.

Special training has been provided to know the company s products and their features and to

know the company s terms and conditions and its policies. During internship lots of data was

given for tele-calling so as to make people aware of the products of Reliance life insurance

then taking appointments and generating leads. Data was also provided for calling people to

get associated with the company and be the company s representative by being its certified

financial consultant.

Finally, conduct the research study on the products of Reliance life Insurance and its

competitor’s products so as to find out the advantages of Reliance life insurance products

over its competitors.

COMPANY PROFILE OF RELIANCE LIFE INSURANCE

Chairman's Profile:

Regarded as one of the foremost corporate leaders of contemporary India, Shri Anil

Dhirubhai Ambani is the chairman of all listed companies of the Reliance ADA Group,

namely, Reliance Communications, Reliance Capital, Reliance Energy, Reliance Natural

Resources and Reliance Power. He is also Chairman of the Board of Governors of Dhirubhai
Ambani Institute of Information and Communication Technology, Gandhi Nagar, Gujarat.

Till recently, he also held the post of Vice Chairman and Managing Director in Reliance

Industries Limited (RIL), India's largest private sector enterprise. Anil Dhirubhai Ambani

joined Reliance in 1983 as Co-Chief Executive Officer, and was centrally involved in every

aspect of the company's management.

If we look for examples to prove this quote then we can find many but there is none like that

of Reliance Money. The company which is today known as the largest financial service

provider of India.

Reliance Capital has interests in asset management and mutual funds, life and general

insurance, private equity and proprietary investments, stock broking, depository services,

distribution of financial products, consumer finance and other activities in financial services.

Reliance Mutual Fund is India's no.1 Mutual Fund. Reliance Life Insurance is India's fastest

growing life insurance company and among the top 4 private sector insurers. Reliance

General Insurance is India's fastest growing general insurance company and the top 3 private

Sector insurers.

Few men in history have made as dramatic a contribution to their country’s economic

fortunes as did the founder of Reliance, Sh. Dhirubhai H Ambani. Fewer still have left

behind a legacy that is more enduring and timeless.

• As with all great pioneers, there is more than one unique way of describing the true

genius of Dhirubhai: The corporate visionary, the unmatched strategist, the proud patriot,

the leader of men, the architect of India’s capital markets, the champion of shareholder

interest.

• But the role Dhirubhai cherished most was perhaps that of India’s greatest wealth

creator. In one lifetime, he built, starting from the proverbial scratch, India’s largest

private sector enterprise.

• When Dhirubhai embarked on his first business venture, he had a seed capital of barely

US$ 300 (around Rs 14,000). Over the next three and a half decades, he converted this

fledgling enterprise into an Rs 60,000 crore colossus—an achievement which earned

Reliance a place on the global Fortune 500 list, the first ever Indian private company to

do so.

• Dhirubhai is widely regarded as the father of India’s capital markets. In 1977, when

Reliance Textile Industries Limited first went public, the Indian stock market was a place

patronized by a small club of elite investors which dabbled in a handful of stocks.

• Undaunted, Dhirubhai managed to convince a large number of first-time retail investors

to participate in the unfolding Reliance story and put their hard-earned money in the

Reliance Textile IPO, promising them, in exchange for their trust, substantial return on

their investments. It was to be the start of one of great stories of mutual respect and

reciprocal gain in the Indian markets.

• Under Dhirubhai’s extraordinary vision and leadership, Reliance scripted one of the

greatest growth stories in corporate history anywhere in the world, and went on to

become India’s largest private sector enterprise.

• Throughout this amazing journey, Dhirubhai always kept the interests of the ordinary

shareholder uppermost in mind, in the process making millionaires out of many of

the initial investors in the Reliance stock, and creating one of the world’s largest

shareholder families.

ABOUT RELIANCE

Reliance Life Insurance Company Limited is a part of Reliance Capital Ltd. of the Reliance -

Anil Dhirubhai Ambani Group. Reliance Capital is one of India’s leading private sector

financial services companies, and ranks among the top 3 private sector financial services and

banking companies, in terms of net worth. Reliance Capital has interests in asset
management and mutual funds, stock broking, life and general insurance, proprietary

investments, private equity and other activities in financial services.

• Reliance Capital Limited (RCL) is a Non-Banking Financial Company (NBFC)

registered with the Reserve Bank of India under section 45-IA of the Reserve Bank of

India Act, 1934.

• Reliance Capital sees immense potential in the rapidly growing financial services sector

in India and aims to become a dominant player in this industry and offer fully integrated

financial services. Reliance Life Insurance is another step forward for Reliance Capital

Limited to offer need based Life Insurance solutions to individuals and Corporate.

MARKETING STRATREGIES OF THE COMPANY

SOME OF THE STRATEGIES ADOPTED BY RELIANCE LIFE INSURANCE

COMPANY

Reliance Life Insurance plans to tap Reliance Communications' 2.5-crore .Telephony

subscriber base to market its products. The company is considering a series of options to

leverage its relationship with Reliance Communications. However, a joint product or a co-
branded solution would require approval from the Insurance Regulatory and Development

Authority Customers of R World, the information and entertainment portal of

Reliance Communications would also be able to pay premiums through a bank account,

provided the bank is listed on the network. Reliance Life Insurance officials, however,

offered no comment when asked whether there would be an arrangement for payment of

commission to Reliance Communications. As an alternative channel for distribution,

insurance companies usually tie up with banks. In the case of banc assurance, where there is

a corporate agency tie-up, the commission could range from 5 per cent to 40 per cent

of first-year premium depending on the commission loaded on to the product at the time of

registration with IRDA.

INDUSTRY PROFILE

INSURANCE

Insurance is basically a sharing device, a tool for managing risk. The losses to assets caused

by unexpected contingencies like fire, earthquake, accidents, etc. are met out of a common

pool contributed by a large number of persons who are exposed to similar risk. This

contribution is known as premium, is used to pay the losses suffered by the unfortunate few.

The concept of insurance is based on certain principals.

1. The contingency of the insured event should be fortuitous in nature, i.e. beyond human

control.

2. The insured should not make any profit out of it.

It requires a large number of insured to make the principal of insurance work, based on law

of profitability.

Business of insurance is related to the protection of the economic value of assets. The asset

would have been created through the efforts of the owner, in the expectation that, either

through the income generated there from or some other output, some of his needs would be

met. However, if the asset gets lost earlier, being destroyed or made non-functional, through
an accident or other unfortunate event, the owner and those deriving benefits there from

suffer.

The business of insurance done by insurance companies (called insurers) is to bring together

persons with common interests (sharing the same risks) collecting the share or contribution

(called premium) from all of them, and paying out compensations (called claims) to those

who suffer.

PURPOSE AND NEED OF INSURANCE

Assets are insured, because they are likely to be destroyed, through accidental occurrences.

Such possible occurrences are called perils, Fire, floods, breakdown, lightning, earthquakes,

etc, are perils. If such perils can cause damage to the asset, we say that the asset is exposed

to that risk. Perils are the events. Risks are the consequential losses or damages. The risk to a

owner of a building, because of the peril of an earthquake, may be a few lakhs or few crores

of rupees, depending on the cost of the building and the contents in it.

The risk only means that there is a possibility of loss or damage. The damage may or may

not happen. Insurance is relevant only if there are uncertainties. If there is no uncertainty

about the occurrence of an event, it cannot be insured against. In the case of a human being,

death is certain, but the time of death is uncertain, In the case of a person who is terminally

ill, the time of death is not uncertain, though not exactly known. He cannot be insured.

Insurance does not protect the asset. It does not prevent its loss due to the peril. The peril

cannot be avoided through insurance. The peril can sometimes be avoided, through better

safety and damage control management. Insurance only tries to reduce the impact of the risk

and the owner of the assets and those who depend on that asset. It only compensates the

losses – and that too, not fully.

Only economic consequences can be insured. If the loss is not financial, insurance may not

be possible. Examples of non economic losses are love and affection of parents, leadership

of managers, sentimental attachments to family heirlooms, innovative and creative abilities,

etc.

CONTRACT OF LIFE INSURANCE

Life insurance contract is an agreement that the insurer will pay a sum of money, called the

sum assured, on the happening of a specified event, usually the death of the assured or his

survival to the end of the specific term. On the other hand, the assured will pay an immediate

smaller payment or a series of regular smaller payments, called premium.

There are two important legal aspects of life insurance worth nothing.

UTMOST GOOD FAITH: A life insurance contract is not just a contract of good faith,

which any commercial transaction is, but it is a contract of utmost good faith. Since one

party to the contract, the assured, knows all the facts which the other party, the insurer,

cannot know despite reasonable efforts. There is a positive duty on the former to voluntarily

disclose, accurately and fully, all facts material to the risk being proposed. A fact is

considered material if it would influence the judgment of a prudent insurer in deciding

whether to insure a particular risk, or the terms on which to insure it. For instance the

existing of other life insurance policies is a material fact. The impact of unlimited duty to;

disclose is mitigated to some extent by sec. 45 of insurance act. Which requires the

following to be proved by the insurer in order to avoid the contract

 1 That a material fact was either misrepresented or not disclosed by the policy holder.

2 That such a misrepresentation or non disclosure by the policy holder was in his

knowledge.

3 That it was done fraudulently

INSURABLE INTEREST: It is the relationship of the insured with the subject matter

(assured) which is recognized in law and gives a legal right to insure that person. Thus a

person is presumed to have unlimited insurable interest in his own life. There are other

presumptions of insurable interest, for example a person having insurable interest on the life

of his or her spouse. A parent is also presumed to be having insurable interest on the life of

her child. Except those, insurable interest is limited to the financial loss a person might

suffer due to the loss of the subject matter. Thus insurable interest of the creditor on the life

of the debtor will be limited to the outstanding loan and interest thereon.

TYPES OF INSURANCE

➢ Life insurance

➢ Non-life insurance or General insurance

These insurance are provided both by government and private insurance companies.

The IRDA Act, 1999 amending the Insurance Act, 1938 in Section 2 sub-section 7(a) state:

“Indian Insurance Company means any Insurer being a company-

(a) which is formed and registered under Companies Act, 1956(1 of 1956);

(b) in which aggregate holding of equity shares by a foreign company either by itself

or through its subsidiary companies or its nominees do not exceed 26% paid up

equity capital of such Indian Insurance Company;

 whose sole purpose is to carry on life insurance business or general insurance

business or re-insurance business.”

The important activities of a life insurance company are:-

a) Procuring from prospective buyers proposals to grant life insurance cover;

b) Checking up and specifying the terms of acceptance called Understanding;

c) Issue contractual documents called policy incorporating various terms and condition;

d) Provide after sales services including payment of money as per contract;

e) Conducting other supporting activities like, investment of funds, carrying out

solvency measures, finalization of accounts, getting or causing audit of accounts,

actuarial valuation including updating mortality tables; and

f) Developing new products, sales promotion activities including publicity, training of

its personal (Sales/ administration).

ROLE OF INSURANCE IN DEVELOPMENT OF THE ECONOMY

Every rupee invested in life insurance contributes in three ways to the

development of the economy.

Firstly, it relieves those insuring from the worry and anxiety they may have about

how they or their family would meet the cost of certain events, such as the

marriage of the children, the premature death of the main income provider or

maintaining a regular income in their retirement. If an individual is free from these

worries he can perform better in his job.

i. Secondly, it directs people’s savings. The insurer invests these funds in

various business enterprises, government bonds, loans to public and private

projects including infrastructure and socially orientated projects. Thus the

insurance premium provides the much needed funds for the development of

the nation’s economy.

ii. Thirdly, these savings act as an anti inflationary force in the nation’s

financial structure. Inflation happens when prices of good go up. One of the
 causes is when a lot of buying takes place, due to the spending of a major

portion of income by people. Savings in insurance reduce buying, as people

will have less money to spend.

NEED FOR LIFE INSURANCE

Life is unpredictable. But in face of adversity, our responsibilities towards our parents,

children and loved ones need not be compromised. Insurance planning equips you to smooth

out the uncertainties and adversities that life might send your way, so that the best that life

has to offer, secure in the knowledge that your beloved ones are well provided for.

As life insurance became more established, it was realized what a useful tool it was for a

number of situations, including –

a) Temporary needs/ threat

The original purpose of life insurance remains an important element, namely

providing for replacement of income on death etc., typically the case of the

breadwinner dying an early death.

b) Regular Saving

Providing for one’s family and oneself, as a medium to long-term exercise (through a

series of regular payment of premiums). This has become more relevant in recent

times as people seek financial independence from their family.

c) Investment
 Put simply, the building up of savings while safeguarding it from the ravages of

inflation. Unlike regular saving products, investment products are traditionally lump

sum investment, where the individual makes a one-time payment.

d) Retirement

Provision for one’s own later years becomes increasingly necessary, especially in a changing

cultural and social environment. One can buy a suitable insurance policy, which will provide

periodical payments in one’s old age, generally identified as the problem of living too long.

ADVANTAGE OF LIFE INSURANCE

(1) It is superior to the traditional saving Instruments.

As well as providing a secure vehicle to build up savings etc, it provides peace of mind to

the policyholder. In the event of untimely death, of say the main earner in the family, the

policy will pay out the guaranteed sum assured, which is likely to be significantly more than

the total premiums paid. With more traditional savings instruments, such as fixed deposits,

the only return would be the amount invested plus any interest accrued.

(2) It encourages saving and forces thrift.

Once an insurance contract has been entered into, the insured has an obligation to continue

paying premiums, until the end of the term of the policy; otherwise the policy will lapse. In

other words, it becomes compulsory for the insured to save regularly and spend wisely. In

contrast savings held in a deposit account can be accessed or stopped easily.

(3) It provides easy settlement and protection against creditors.

Once a person is appointed for receiving the benefits (nomination) or a transfer of rights is

made (assignment), a claim under the life insurance contract can be settled easily. In

addition, creditors have no rights to any monies paid out by the insurer, where the policy is
written under trust. Under the Married Women’s Property Act (M.W.P Act), the money

available from the policy forms a kind of trust which cannot be attached by judgment

creditors.

(4) It helps to achieve the purpose of the Life Assured.

If someone receives a large sum of money, it is possible that they may spend the money

unwisely or in a speculative way. To overcome this, the person taking the policy can instruct

the insurer that the claim amount is given in installments.

(5) It can be enchased and facilitates quick borrowing.

Some contracts may allow the policy to be surrendered for a cash amount, if a policyholder

is not in a position to pay the premium. A loan, from certain policies, can be taken for a

temporary period to tide over the difficult. Some lending institutions will accept a life

insurance policy as collateral for a personal or commercial loan.

(6) Tax Relief

The policyholder obtains Income Tax rebated by paying the insurance premium. The

specified forms of saving which enjoy a tax rebate, include Life Insurance Premiums and

contributions to a recognized Provident Fund etc., section 10 (10D) & other sub-sections of

Section 80C of the Income Tax Act 1961.

WHAT DOES LIFE INSURANCE HAVE TO OFFER?

Life insurance is many different things to many different people. For some, it is a premium

to be paid on time. For others it offers liquidity since cash can be borrowed when needed.

For the investment-minded, it denotes a constantly growing capital account and numerous

other benefits.

The contractual guarantee is the promise to pay, backed by one of the oldest and most stably

regulated financial industry operating in the Indian sub-continent today.

1) Insurance Buys Time and Money

People like to refer to life insurance as time insurance, the reason being that life insurance

proceeds are paid to the insured's beneficiaries in case of death. The money proffered by life

insurance helps buy time to adjust to the change of circumstances. Insurance provides large

amounts of cash that will keep the lifestyle for the survivors the way it was before the

insured's death.

2) Insurance Offers Peace of Mind

For the person who buys an insurance policy, it offers absolute and complete peace of mind.

He or she knows that the decision made by him will provide sound benefits in the future,

whether or not the individual may live to see it.

3) Multiple Applications

The future is uncertain for each and every one. No one knows how long he or she will live.

The investment benefit is paid to the insured's beneficiaries after his death or it can be used

during the life as well. Life insurance policy owners can turn to the cash value of the policy

in case of a financial emergency when all avenues are either blocked or denied.

4) Enduring Elasticity

Since life insurance is flexible enough to serve several needs, the insured can keep several

long-term goals in mind once he or she invests in the insurance plan. The cash value of the
policy can be allocated towards augmenting the monthly income during the retirement years.

Leisure years should be turned into pleasure years. Permanent life insurance is designed on

the concepts of long-term flexibility.

5) Financial Security

The insurance policy offers contractual guarantees to people looking for peace of mind when

they buy life insurance. Life insurance offers complete financial security. The purchase of

life insurance demonstrates concern for a family's future financial well being.

6) Regard for Family

The purchase of life insurance clearly displays care and concern for the people the policy

owner loves.

7) Insurance is Safer

No financial institution can do what life insurance does. No industry can back its products

with reserves and surplus as sound as those of the insurance industry.

The proof of strength and safety that insurance companies have ensured even under the most

adverse of conditions is a matter of pride for the entire insurance industry. For generation

after generation, life insurance has been acclaimed as the very benchmark of security against

which the other industries are measured.

OPPORTUNITIES FOR INSURANCE COMPANIES

In the now open sector on insurance, the following is what I feel will determine the success

of the company in particular and the industry in general:

• A change in the attitude of the population

Indians have always been wary of employing their hard-earned money in a venture that will

pay them on their death. Insurance has always been used as a Tax saving tool. No more, no

less. It is depend upon the Financial Consultant to educate the people to secure/insure their

future against any unknown calamity and make a shield around their families and businesses.

• An open and transparent environment created under the IRDA.

The reason for this being on the top of our understanding is that when ever we have seen

any sector open up in India there are always grey areas and unsure policies. These are not

exactly what any player, be it Indian or foreign, looks for. It creates an air of uncertainty

in all the decision making process. Insurance as a sector requires players who are strong

financially and are willing to wait for returns. Their confidence can be bolstered only if

there is an open and a transparent policy guidelines. This will also help the consumers

feel safe that the regulatory is an active one and cares to do everything possible to keep

things under control and help the insurance environment grow maturely.

• A well-established distribution network.

To cater to the largest democracy in the world is by no means a cakewalk. Insurance profits

are directly related to number of insured and this is in turn related to the reach.

• Trained professionals to build and sell the product.

It is said that the insurance agent (Financial Consultant) is the best salesman in the world.

He makes you pay, regularly, an amount promising to pay back only on your death. Thus the

players will require an excellent sales team to sell their products in the now competitive

environment.

• Encouragement of new and better products and letting the hackneyed ones die out.
This will itself ensure the market grows. And that every class/society gets a product that best

suits them.

SWOT ANALYSIS OF INSURANCE INDUSTRY

STRENGTH

1. Best returns with the added advantage of 100% life insurance coverage.

2. Good option for new investors into the market as all the money is invested

by best fund managers so with less knowledge also they can earn good

returns.

3. Best commission charges paid to the agents which vary from 12% to 40%

which is much higher as compared to mutual funds i.e. , only 22.5%.

WEAKNESS
1. RELIANCE LIFE INSURANCE could not able to match LIC in remote areas services.

2. Misleading facts given by Financial Consultant about the returns of ULIPs.

3. Hidden charges taken by the companies.

4. Less Promotional Campaigns.

OPPORTUNITY

1. 80 percent of Indian population is still under insured. So there is a big opportunity for

insurance companies.

2. As the stock market can be under the mark any time so it can bring loss to

the investors but as in ULIPs there is proper mixture of debt securities and

Equity so the loss is incurred during dark trading days also.

3. Unit-linked products are exempted from tax and they provide life insurance.

4. Increasing consumer awareness about Insurance and its use.

THREAT

1. Cannibalism within the industry by providing misleading figures to the investors.

2. Govt.’s instability has a long term repercussions affecting company’s policies and its

growth.
LIFE INSURANCE IN INDIA

The history of life insurance in India dates back to 1818 when it was conceived as a means to

provide for English Widows. Interestingly in those days a higher premium was charged for

Indian lives than the non-Indian lives as Indian lives were considered more risky for

coverage.

The Bombay Mutual Life Insurance Society started its business in 1870. It was the first

company to charge same premium for both Indian and non-Indian lives. The Oriental

Assurance Company was established in 1880. The General insurance business in India, on

the other hand, can trace its roots to the Triton Insurance Company Limited, the first general

insurance company established in the year 1850 in Calcutta by the British. Till the end of

nineteenth century insurance business was almost entirely in the hands of overseas

companies.
Insurance regulation formally began in India with the passing of the Life Insurance

Companies Act of 1912 and the provident fund Act of 1912. Several frauds during 20's and

30's sullied insurance business in India. By 1938 there were 176 insurance companies. The

first comprehensive legislation was introduced with the Insurance Act of 1938 that provided

strict State Control over insurance business. The insurance business grew at a faster pace

after independence. Indian companies strengthened their hold on this business but despite the

growth that was witnessed, insurance remained an urban phenomenon. The Government of

India in 1956, brought together over 240 private life insurers and provident societies under

one nationalized monopoly corporation and Life Insurance Corporation (LIC) was born.

Nationalization was justified on the grounds that it would create much needed funds for

rapid industrialization. This was in conformity with the Government's chosen path of State

lead planning and development.

The (non-life) insurance business continued to thrive with the private sector till 1972. Their

operations were restricted to organized trade and industry in

large cities. The general insurance industry was nationalized in 1972. With this, nearly 107

insurers were amalgamated and grouped into four companies- National Insurance Company,

New India Assurance Company, Oriental Insurance Company and United India Insurance

Company.

These were subsidiaries of the General Insurance Company (GIC).

Life insurance business in India was nationalized with effect from 1st September, 1958. From

this date, the life insurance business transacted by 154 Indian life insurers, the Indian

business of 16 foreign insurers and 75 provident societies was taken over by Government of

India Act, 1956, passed by the Parliament on 18-6-56. The Life Insurance Corporation of

India (LIC) which had been established i.e. 19-5-1956 as a body corporate having perpetual

succession and common seal with power to acquire, hold and dispose property and to sue

and be sued in its name.

Under Section 30 of the Act, from the appointment date i.e. 1-9-56, LIC acquired the

exclusive privilege of carrying on life insurance business in India and the certificate of
registration granted to any insurer under the Insurance Act, 1938 ceased to have effect from

the said date.

Now the above, provision of section 30 have been altered by insertion of Section 30A

consequent to the enactment of the IRDA Act, 1999. As a result the exclusive privilege

given to the LIC has been withdrawn.

The Government of India liberalized the insurance sector in March 2000 with 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. Under the current guidelines, there is a 26 percent equity

capital for foreign partners in an insurance company. There is a proposal to increase this

limit to 49 percent.

The opening up of the sector is likely to lead to greater spread and deepening of insurance in

India and this may also include restructuring and revitalizing of the public sector companies.

In the private sector 14 life insurance companies have been registered. A host of private

Insurance companies operating in both life and non-life segments have started selling their

insurance policies since 2001.

THE INSURANCE REGULATORY AND DEVELOPMENT

AUTHORITY (IRDA)

BACKGROUND

A faster development and wider impact of the insurance industry were to be achieved

through a process of insurance reforms resulting in the liberalization of the market and in the

passage of the Insurance Regulatory and Development Authority (IRDA) Act, 1999. The

reforms procedures recognized simultaneously the need for development of the sector in

addition to the traditional concept of regulation and thus conferred on the Authority the

obligation to develop the sector as well.

MISSION STATEMENT

The IRDA main mission was stated as follows:

• To protect the interest of and secure fair treatment to policyholders:

• To bring about speedy and orderly growth of the insurance industry, for the benefit

of the common man, and to provide long terms funds for accelerating growth of the

economy;

• To set, promote, monitor and enforce high standards of integrity, financial

soundness, fair dealing and competence of those it regulates:

 • To ensure that insurance customers receive precise, clear and correct information

about products and services and make them aware of their responsibilities and duties

in this regard;

• To ensure speedy settlement of genuine claims, to prevent insurance frauds and

other malpractices and put in place effective grievances redressed machinery;

• To promote fairness, transparency and orderly conduct in financial markets dealing

with insurance and build a reliable management information system to enforce high

standards of financial soundness amongst market players;

IRDA POWERS AND FUNCTIONS

Subject to the provisions of IRDA Act (1990), IRDA will: regulate, promote and ensure

orderly growth of the insurance business and re-insurance business, which will include the

following main functions (excerpts):

• Issue to the applicant a certificate of registration, renew, modify, withdraw, suspend

or cancel such registration;

• Protection of the interest of the policy holders in matters concerning assigning off

policy, nomination by policy holders, insurable interest, settlement of insurance

claim, surrender value of policy and others terms and conditions of contracts of

insurance;

• Specifying requisite qualifications, code of conduct and practical training for

intermediary or insurance intermediaries and agents.

• Promoting and regulation professional organizations connected with the insurance

and re-insurance business;

 • Levying fees and other charges for carrying out the purposes of the Act;

• Calling for information from, undertaking inspection of, conducting enquiries and

investigations including audit of the insurers, intermediaries, insurance

intermediaries and other organizations connected with the insurance business;

• Specifying the percentage of life insurance and general insurance business to be

undertaken by the insurer in the rural or social sector.

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 has the rest of the market share of the insurance

industry

SPECIAL PROVISIONS

The Income Tax Act and Life Insurance policies

• Under Section 10(10D), any sum received under a Life Insurance policy (not being a

Key Man policy) is also exempt from taxation. But it is wise to remember that Pensions

received from Annuity plans are not exempted from Income Tax.
• Section 80C provides a deduction up to Rs.1,00,000/- to an individual assesses for any

amount paid as a premium.

POLICYHOLDERS GRIEVANCES

Policyholders may have complaints against insurers either in respect of their policies or their

claims. As per Regulations for Protection of policyholders’ interests, 2002, every insurer

should have in place, a grievance redressal system to address the complaints of

policyholders. The IRDA has a Grievance Redressal Cell which plays a facilitative role by

taking up complaints against insurers with the respective companies for speedy resolution.

The IRDA however does not adjudicate on complaints.

INDIAN INSURANCE INDUSTRY

Insurance industry, as on 1.4.2000, comprised mainly two players:

Life Insurers:

• Life Insurance Corporation of India (LIC)

General Insurers:

• General Insurance Corporation of India (GIC)

GIC had four subsidiary companies, namely (with effect from Dec'2000, these subsidiaries

have been de-linked from the parent company and made as independent insurance

companies.

1. The Oriental Insurance Company Limited

2. The New India Assurance Company Limited,

3. National Insurance Company Limited

4. United India Insurance Company Limited.

Yr: 2000-2001: (From 2nd April '2000 to 31st December'2001)

Insurance Industry in the year 2000-2001 had 16 new entrants, namely:

Life Insurers:

S.No. Reg. Date of Reg. Name of the Company

Number

1 101 23.10.2000 HDFC Standard Life Insurance Company

Ltd.

2 104 15.11.2000 Reliance insurance Insurance Co. Ltd.

3 105 24.11.2000 Reliance Life Insurance Company Ltd.

4 107 10.01.2001 Kotak Mahindra Old Mutual Life Insurance

Limited
5 109 31.01.2001 Reliance Insurance Company Ltd.

6 110 12.02.2001 Tata AIG Life Insurance Company Ltd.

7 111 30.03.2001 SBI Life Insurance Company Limited.

8 114 02.08.2001 ING Vysya Life Insurance Company Private

Limited
9 116 03.08.2001 Bajaj Allianz Life Insurance Company

Limited
General Insurers :

S.No. Registration Date of Name of the Company

Number Registration

1 102 23.10.2000 Royal Sundaram Alliance

Insurance Company Limited

2 103 23.10.2000 Reliance General Insurance

Company Limited.

3 106 04.12.2000 IFFCO Tokyo General Insurance

Co. Ltd

4 108 22.01.2001 TATA AIG General Insurance

Company Ltd.

5 113 02.05.2001 Bajaj Allianz General Insurance

Company Limited

6 115 03.08.2001 ICICI Lombard General Insurance

Company Limited.

Yr: 2001-2002: (From 1st Jan 2001 to Dec. 2002)

Insurance Industry in this year, so far has 5new entrants; namely

Life Insurers:

S.No. Reg. Date of Reg. Name of the Company

Number
1 121 03.01.2002 AMP Sanmar Life Insurance Company

Limited.

2 122 14.05.2002 Aviva Life Insurance Co. India Pvt. Ltd.

General Insurers :

S.No. Registration Date of Name of the Company

Number Registration

1 123 15.07.2002 Cholamandalam General Insurance

Company Ltd.
2. 124 27.08.2002 Export Credit Guarantee

Corporation Ltd.
3. 125 27.08.2002 HDFC-Chubb General Insurance

Co. Ltd.

Yr: 2003-2004: (From 1st Jan 2003 till Date)

Insurance Industry in this year, so far has 1new entrants; namely

Life Insurers:

S.No. Registration Name of the Company

Number
1 127 Sahara India Insurance Company Ltd.

Yr: 2004-2005:

Insurance Industry in this year, so far has 1new entrants; namely

Life Insurers:

S.No. Registration Date of Reg. Name of the Company

Number
1 128 17.11.2005 Shriram Life Insurance Company Ltd.

PROTECTION OF THE INTEREST OF POLICY HOLDERS

IRDA has the responsibility of protecting the interest of insurance policyholders. Towards

achieving this objective, the Authority has taken the following steps:

• IRDA has notified Protection of Policyholders Interest Regulations 2001 to provide

for: policy proposal documents in easily understandable language; claims procedure

in both life and non-life; setting up of grievance redressal machinery; speedy

settlement of claims; and policyholders' servicing. The Regulation also provides for

payment of interest by insurers for the delay in settlement of claim.

• The insurers are required to maintain solvency margins so that they are in a position

to meet their obligations towards policyholders with regard to payment of claims.

• It is obligatory on the part of the insurance companies to disclose clearly the benefits,

terms and conditions under the policy. The advertisements issued by the insurers

should not mislead the insuring public.

• All insurers are required to set up proper grievance redress machinery in their head

office and at their other offices.

• The Authority takes up with the insurers any complaint received from the

policyholders in connection with services provided by them under the insurance

contract.
 MARKET SHARE ANALYSIS

PARTICULARS 2004-05 2005-06 2006-07

LIC 87.7 71.04 71.44

PRIVATE PLAYERS 12.3 28.96 28.56

growth in market share of private

players

100
87.7
m a r k e t s h a r e (%)

90
80 71.04
70
60
LIC
50
Pvt. Players
40
28.96
30
20 12.3
10
0
2004-05 2005-06
years
 INTRODUCTION

A well developed and evolved insurance sector is needed for economic development as it is

provides long term funds for infrastructure development and the same time strengthen the

risk taking ability.

Life insurance is also now being regarded as a versatile financial planning tool in

India. India being a country having a huge population of around one billion people with only

35%of the insurance population in India possessing life insurance. The country has a vast

potential that has been left untapped till now.

Therefore, what this has led to is the flooding of life insurance market with a number of

private players which in collaboration with recognized foreign companies’ promises to

deliver the best of services at the least price. All these companies are trying to grasp the

maximum of market share in life insurance sector. For that they are developing a channel i.e.

recruiting world-class insurance advisors/agents who sell their products or policies. Who are

these advisor/agents? Who can become an advisor/agent? How they are recruited in

RELIANCE INSURANCE CO. LTD.? How much they can earn as an insurance

advisor/agent? , these are some questions we have tried to answer in the project.

This report gives the details of recruitment and selection process of the life

insurance advisors. Thus by going through the report one will get to know about the

recruitment and selection process of life insurance advisors/agents in RELIANCE

INSURANCE CO. LTD. The report also covers the comparative study of the channel

development process in the company with that of Reliance.

 Channel Development

Channel development is basically to convince the potential customer to become advisors.

Now these advisors will convince some other people and that how channel is made. Now the

channel development involves a recruitment & selection process, which a person has to

undergo in order to become an advisor.

Reliance insurance has identified individual agents as its primary channel of distribution.

The Company places a lot of emphasis on its selection process. The agent advisors are

trained in-house to ensure optimal control on quality of training.

Reliance insurance invests significantly in its training programme and each agent is trained

for 152 hours as opposed to the mandatory 100 hours stipulated by the IRDA before

beginning to sell in the marketplace. Training is a continuous process for agents at Reliance

insurance and ensures development of skills and knowledge through a structured programme

spread over 500 hours in two years. This focus on continuous quality training has resulted in

the company having amongst the highest agent pass rate in IRDA examinations and the

agents have the highest productivity among private life insurers.

201 agent advisors have qualified for the Million Dollar Round Table (MDRT) membership

in 2005. MDRT is an exclusive congregation of the world’s top selling insurance agents and

is internationally recognized as the standard of excellence in the life insurance business.

Having set a best in class agency distribution model in place, the company is spearheading a

major thrust into additional distribution channels to further grow its business. The company

is using a five-pronged strategy to pursue alternative channels of distribution. These include

the franchisee model, rural business, direct sales force involving group insurance and

telemarketing opportunities, banc assurance and corporate alliances.

Recruitment and selection of insurance advisors

As we know that “Recruitment involves seeking and attracting a pool of people, from which

qualified candidates for the job vacancies can be chosen. Recruitment sets out the necessary

stages to clarify what kind of person is required, where he/she might be found and how to

make right choice”.

Recruitment of life insurance agent is also a very impressive criterion because in this process

we need to recruit and select those persons who bear some special characteristics, which are

very necessary to sell insurance. Life insurance is an intangible product and it needs

insurance advisors who are having tremendous skills to sell an intangible product.

The key to good selection is preparation. So many people are found of their ability to pick a

good sales person and so often, that person is good but not at the particular job which needs

to be done. It is vital to be clear about what job needs doing and what kind of person would

do it best; and then to find that person. Once the plan has been decided, the choice of

candidate should be made carefully.

The effectiveness of the unit manager is dependent to great extent on the effectiveness of the

team of advisors supporting him, because an advisors works under a unit manager. So it is

very important to recruit a very good team of life insurance advisors who can give their best

to increase the effectiveness and the profit of the company. RELIANCE give very much

stress on it and to recruit only those people as a life insurance advisor who is having some

key skills specifies by the company.

Further we will show the recruitment and selection procedure of life insurance advisors in

Reliance insurance company ltd, and try to analyze whether it is the best process of

recruitment or company can do certain new modifications to enhance their recruitment

processor for the increment of company’s effectiveness. From the next page, we will see the

recruitment and selection procedure of life insurance advisors.

BE AN ADVISOR

Being an insurance advisor aspire to provide state of the art customer services and

opportunities and venues for enterprising people to grow and prosper.

Backed by latest technology, they will offer their customers:-

➢ Complete and diversified product portfolio.

➢ Faster and more accurate service.

➢ Multi channel distribution system.

➢ High quality financial advisers.

Eligibility norms provided by IRDA for becoming an insurance advisor

➢ Person should be at least 18 years of age;

➢ Person have completed 10+2;

➢ Person should attain 100 hours training.

Other than this the person should possess

➢ Good communication skills

➢ Relationship skills

➢ Confidence

➢ Self motivation

➢ Persuasion

➢ Urge to be financially independent

BEING AN ADVISOR WITH RELIANCE INSURANCE

Being a Reliance Insurance advisor can be an enriching and exciting career option. It’s an

opportunity to associate with an industry leader, be in touch with the latest and finest

insurance practices from around the globe, and grow both personally and professionally.

Here are some of the benefits of being a Reliance Insurance Advisor:

 Unlimited earning potential

 A clear career path

 All round support through exclusive advertising, your own in-house consultant,

and world-class training

 A comprehensive benefit package

What does it take to be a Reliance Insurance advisor?

At Reliance Insurance, we believe that our Advisors are our ambassadors to the customers.

They are a key source of business for the organization, and are the continuing link with our

clients. That is why, we take a lot of care in recruiting and developing our advisor force, so

that we continue to set higher standards of quality in service and salesmanship. To cater to

the needs of the knowledge-oriented marketplace, we look for graduates who are service-

oriented, good communicators and enjoy meeting new people. Prior sales experience is an

added benefit.

Some of the qualities we seek are:

➢ self- motivation

➢ a master communicator

➢ a go-getter

➢ a graduate
TRAINING

At Reliance Insurance, we understand the importance of training in a dynamic business

environment. Our advisors go through both generic and specific, professional programs that

help them remain well-informed and knowledgeable about the company’s products in the

market. There is a further focus on soft skills such as communication, managing long-term

relationships and selling skills, which are very relevant in a service-driven industry like life

insurance.

State of the art infrastructure training facilities coupled with an excellent faculty, guarantee

an exceptional learning environment. For advisors who might be occupied with their daily

business/professional routines, Reliance Insurance also offers convenient training options

such as online and self-learning are also provided by the organization.

An 18-day training schedule covers the mandatory IRDA training requirements and

Reliance Insurance product-training module. Revision session ensure that the candidates

thoroughly understand the course contents and are well prepared for the licensing

examination. Theoretical training is interspersed with practical appointment settings with

potential customers, giving advisors a feel of how their business will work from the very

first day. All through, the Agency Manager and the management provide continuous support

to the advisors in achieving independence towards garnering business.

CAREER

At Reliance Insurance, career development is emphasized upon from the very day the

advisor joins the system. Though individual meetings with his or her manager, the advisor

can discuss various issues related to business development and career enhancement.

Expectations from the organization in terms of chalking a career in the insurance industry are

also discussed.
OPPORTUNITIES FOR BEING AN ADVISOR

➢ To be a part of world class sales team

➢ Work from your office or residence

➢ Work fulltime or part time

➢ Earn commission, bonuses and incentives

➢ Flexible career

➢ Unlimited earning potential

 ROLE OF AN ADVISOR

An insurance advisor plays an important role. He is link between the insurance company on

the one hand and the prospect on the other hand. He has to understand the life insurance

needs of the prospect and offer to meet them by providing insurance solution in the form of

company’s product. In your role an insurance advisor, unless you are convinced of your self-

worth, you may not be effective in your professional pursuit. The question arises whether an

insurance advisor is a professional like a doctor, a lawyer or a chartered accountant. There

are four basic requirements for any vocation to be called a profession:

➢ It requires acquisition of expertise on the part of its practitioner and also its updating.

➢ There has to be customer-orientation, so that the focus of the professional is on

satisfying the needs of the customer and his own needs get satisfied if the customer is

satisfied.

➢ Certain of ethics in dealing with clients, fellow-professionals, etc, have to be

observed.

➢ The vocation should be noble in that it contributes to the society.

THE REQUISITES OF A TIDE AGENCY/ADVISOR IN RELIANCE

1. One copy of date of birth proof (10th mark sheet).

2. One copy of 12th class/graduation mark sheet.

3. One residence proof.

4. 8 passport size photographs.

5. PAN Card.

ADVISOR QUALITY PARAMETER

We have to identify right kind of quality people to be advisors with ICICI PRU. For this

purpose I targeted the following sets of people:

1. CA, CS, ICWA

2. DOCTORS

3. LAWYERS

4. TAX CONS

5. MARKETING EXECUTIVES OF DIFFERENT BANKS

6. UNEMPLOYED

7. RETIRED PEOPLE

8. HOUSE WIVES

9. LOCAL POLITICIANS

TECHNIQUES USED IN RECRUITMENT

To approach the above mentioned people I used the following methods:

1. PROSPECTING: I decided to do prospecting in front of the BANKS AND

FINANCIAL INSTITUTIONS as a large number of marketing executives visit these

places throughout the day. I used to meet these people and offer them to join the

INDIA’S leading PVT. Sector group ICICI as FINANCIAL ADVISORS. I got the

maximum recruitments through prospecting. The best thing about prospecting was

that at the end of the day I used to have more than 100 references to call for the next

day.

2. COLD CALLING: It was also a very successful technique in recruitment of

advisors. Though the conversion rate was very low but I got very potential advisors

through cold calling. I used business directories, yellow pages, telephone directories,

news papers for the same purpose.

3. TAKING REFRENCES: Taking references is very essential in the insurance

business as this business is based on contacts. I took references from the following:

DATABA
RELATIV
FRIEN
NEIGHBOUR
CUSTO
NAME
ES
DS
S
MES
SE
S
DATABA
RELATIV
FRIEN
NEIGHBOUR
CUSTO
NAME
ES
DS
S
MES
SE
S
 4. PAMPHLET DISTRIBUTION: I distributed pamphlets at Railway Stations, Bus

Stops, busy red lights, highlighting the advantages of being an advisor with

RELIANCE INSURANCE. I got a good response and call backs and was able to find

some good prospects through this procedure.

CORPORATE OBJECTIVE

At Reliance Life Insurance, we strongly believe that as life is different at every stage, life

insurance must offer flexibility and choice to go with that stage. We are fully prepared and

committed to guide you on insurance products and services through our well-trained

advisors, backed by competent marketing and customer services, in the best possible way.

• It is our aim to become one of the top private life insurance companies in India and to

become a cornerstone of RLI integrated financial services business in India.

CORPORATE MISSION

• “To set the standard in helping our customers manage their financial future”.

BELOW ARE FEW OF THE PLANS THAT ARE OFFERED BY RELIANCE LIFE

INSURANCE

INSURANCE PLANS AVAILABLE

1. Products (Individual Plans)

Savings (Endowment)

2. Reliance Endowment Plan

(formerly Divya Shree)

3. Reliance Special Endowment Plan

(formerly Subha Shree)

4. Reliance Cash Flow Plan

(formerly Dhana Shree)

 5. Reliance Child Plan

(formerly Yuva Shree)

6. Reliance Whole Life Plan

(formerly Nithya Shree)

Pensions

7. Reliance Golden Years Plan

(formerly Bhagya Shree)

Investments

8. Reliance Market Return Plan

(formerly Kanaka Shree)

9. Risk / Protection

10. Reliance Term Plan

(formerly Raksha Shree)

Products (Group / Corporate Plans)

 11. Risk (Protection)

Reliance Group Term Assurance Policy

(formerly Group Term Assurance Policy)

Reliance EDLI Scheme

(formerly EDLI Scheme)

12. Pensions

a. Reliance Group Gratuity Policy

(formerly Group Gratuity Policy)

b. Reliance Group Superannuation Policy

(formerly Group Superannuation Policy)

13. Reliance Money Guarantee Plan

Tax Benefits

INCOME TAX GROSS ANNUAL HOW MUCH TAX RELIANCE LIFE

SECTION SALARY CAN YOU SAVE?

INSURUANCE PLAN
Sec. 80C Across All income Upto Rs. 33,990 All the life insurance

Slabs saved on plans.

investment of

Rs. 1,00,000.

Sec. 80 CCC Across all income Upto Rs. 33,990 All the pension plans.

slabs. saved on

Investment of

Rs.1,00,000.

Sec. 80 D Across all income Upto Rs. 3,399 All the health insurance

slabs saved on riders available with the

Investment of conventional plans.

Rs. 10,000.

TOTAL SAVINGS
Rs37,389
POSSIBLE
Rs. 33,990 under Sec. 80C and under Sec. 80 CCC , Rs.3,399 under

Sec. 80 D, calculated for a male with gross annual income

exceeding Rs. 10,00,000.

Sec. 10 (10)D Under Sec. 10(10D), the benefits you receive are completely tax-free,

subject to the conditions laid down therein.

2.3 Reliance Policies

(1) Reliance Children Plans

What could make you happier than knowing, that your child's future is secure? Nothing, we

suppose. Which is why, Reliance Life Insurance brings to you Reliance Secure Child Plan, a

unit-linked Insurance Plan, that gives you the freedom to enjoy today with your child,

because his tomorrow is in safe hands.

• Do you see your child becoming a trailblazer?

• Will they create the ultimate symphony or give sports a new dimension?
 Our children may just be the ones to end the arms race and wipe out poverty from the

face of the Earth. But for them to be able to aim for the skies, YOU NEED TO ACT

NOW!

Introducing Reliance Secure Child Plan - a unique life insurance cum savings plan. secure

the future of your child.

Key Features
Insurance cover on the life of child
Your child is completely protected - we will continue to pay the

premiums even if you are not alive

Life time income to child in the event of disability

Return Shield option to protect your investment returns

Liquidity in the form of partial withdrawals

Capital guarantee available on maturity and on death of the child for

basic and top-up premiums

Option to package with Accidental Death and Total and Permanent

Disablement Rider, Critical Conditions Rider and Term Life Insurance

Benefit Rider.

(2)Reliance Health + Wealth Policy

UNDER THIS PLAN THE INVESTMENT RISK IN THE INVESTMENT PORTFOLIO IS

BORNE BY THE POLICYHOLDER.

There are times when late working hours take precedence over your health check-ups. And

there are times when a visit to the doctor seems more important than dividends on your

shares. In the rat race to make money, we often forget to take care of ourselves.

We understand this predicament. Here is a plan that will ensure that your wealth keeps

increasing constantly and yet your health does not take a backseat. The Reliance Wealth

Health Plan. A plan that gives you the benefits of wealth & health.
Life changes. And as it does, so do your priorities. After all, the circumstances of your life

can determine the type of health coverage you need.

India has made rapid strides in the health sector. Since Independence, life expectancy has

gone up markedly and survival rates have also increased, still critical health issues remain.

Infectious diseases continue to claim a large number of lives.

Reliance Wealth + Health Plan, a health insurance plan underwritten by Reliance Life

Insurance Company Limited, is designed to work in conjunction with contributions towards

savings.

Key Feature
A Unit Linked plan with Unique Savings Component
Twin benefit of market linked return and health protection
Choose from two different plan options
Flexibility to take care of your family’s health
Flexibility to switch between funds / plan options
Option to pay Top-ups
(3) Reliance Pension Policy

UNDER THIS PLAN THE INVESTMENT RISK IN THE INVESTMENT PORTFOLIO IS

BORNE BY THE POLICYHOLDER.

Retirement means different things to different people, while some want to relax and take a

trip around the world, some want to start up a venture of their own, and pursue a dream

harnessed for years. The power to make your autumn years special lies only with you. The

Reliance Super Golden Years Plan gives you the power and the right kind of solution - A

retirement plan that allows you to save systematically and generate the much-needed corpus

to make your olden years look golden.

Key Features –
Invest systematically and secure your golden years
A flexible unit-linked pension product that is different from traditional life

insurance products with Vesting Age between 45 & 70 years

Eight different investment funds to choose from
Flexibility to switch between funds
Option to pay Regular, Single as well as Top-up premiums
Flexibility to advance / extend your Vesting Age
Tax free commutation up to one third of Fund Value at Vesting Age
(4) Reliance Whole life insurance policy

You’ve always loved your family. As a loving person you want to be rest assured that they

will be happy, even if something were to happen to you. With Reliance Whole Life Plan you

can be sure that your family will receive that timely financial support they need.

Go ahead, live your today to the fullest, without a worry about tomorrow.

Key Features
Insurance protection till age 85
Choice of extending your insurance coverage till age 99
Convenient Premium Payment Term
Wealth creation through bonus additions
More value for your money by way of High Sum Assured Rebate Get Sum

Assured plus Bonuses in case of your unfortunate death

Option to add two Riders – Critical Illness and Accidental Death Benefit and

Total and Permanent Disablement Rider

Policy Loan available after three full years premium payment
 RE SEARCH DESIGN

INTRODUCTION

A Resea rch Design is the framework or plan for a study which is used as a

guide in col lecting and analyzi ng the data collected. It is the blue print that is

followed in comp leting the stud y. The basic objective of resea rch cannot be
attained without a proper resea rch des ign. It spec ifies the methods and

proced ures for acquir ing the info rmation needed to conduct the resea rch

effectiv ely. It is the overall operational patte rn of the project that

stip ulates what info rma tion needs to be collected, from which sources and

by what methods.

OBJECTIVES OF STUDY

The main purpose of the training is to get the corporate exposure so as to know that how the

work is done in the company so as to bridge the gap between the academic institution and

corporate world.

• It exposes us to technical skills that how the tele-calling is done to get

appointments and helping us to acquire social skills by drawing us into the

contact with real professionals.

• It is a vehicle for introducing us to real-life situation, which cannot be stimulated

in classroom.

• To know how the recruitment of the financial consultants is done.

• To know how one can do personal financial planning.

• To know the mindset of the customers about insurance their reactions and many

more.

The research design is of exploratory type as it tries to explore the customers’ perception to

make a reasonable comparison between the two companies.

· NON-PROBABILITY

· EXPLORATORY & DISCRIPTIVE EXPERIMENTAL RESEARCH

The research is primarily both exploratory as well as descriptive in nature.

The sources of information are both primary & secondary.

A well-structured questionnaire was prepared and personal interviews

were conducted to collect the customer’s perception and buying behavior,

through this questionnaire.

 RESEARCH METHODOLOGY

METHODS OF COLLECTING DATA:

The method of data collected was personal interaction, telephonic interview, observations of

the existing appraisal system of Reliance life insurance

The data so far collected or provided is secondary as total tele-calling was done on an

already existing data for financial planning and to become company s certified financial

consultant. But directories are also used to find out the contacts.

TYPE OF DATA COLLECTED

There are two types of data used. They are primary and secondary data.

Primary data is defined as data that is collected from original sources for a specific purpose.

Secondary data is data collected from indirect sources.

PRIMARY SOURCES

These include the survey or direct communication with employees and questionnaire

method, telephonic interview as well as the personal interview methods of data collection.

SECONDARY SOURCES

These include books, the internet, company brochures, product brochures, the company

website, newspaper articles etc.

SAMPLING METHODOLOGY

Sampling Technique:

Initially, a rough draft was prepared keeping in mind the objective of the research. A pilot

study was done in order to know the accuracy of the Questionnaire. The final Questionnaire
was arrived only after certain important changes were done. Thus my sampling came out to

be judgmental and convenient

Sampling Unit:

The respondents who were asked to fill out questionnaires are the sampling units. These

comprise of employees of MNCs, Govt.Employees, Self Employed etc.

Sample size:

The sample size was restricted to only 100, which comprised of mainly people from

different regions of Lucknow due to time constraints.

Sampling Area :

The area of the research was Lucknow, India.

ANALYSIS

Selection and Placement of Insurance Advisors

“A selection system is a set of successive screens at any of which an applicant may be

dropped from further consideration”. The process of selection of insurance advisors differs

from companies to companies depending upon the requirement. In RELIANCE the applicant

goes through various stages, the chances of selection get better as more and more stages are

cleared.
Selection procedure: The following selection procedure is used by for the selection of life

insurance advisor in Reliance insurance company.

○ Preliminary interview: In this interview the applicant have face-to-face interaction

with the respective Unit Manager and clear out all queries and doubts about job.

After this interview session, the prospects give his conformation whether he is

interesting to join the organization or not.

○ Formal application: After the confirmation of the prospects the next step is to filling

up of application form with the submission of all necessary documents that are listed

below:

--Birth certificate (10th class passing certificate, driving license,

etc)

--Address proof (ration card, voter card, telephone bill, etc)

--6 passport size color photographs

--Highest qualification certificates (mark sheet)

--A demand draft of Rs. 610 on the favor of “Reliance

insurance.

After checking the form and all documents the operations department give its confirmation

that the prospects is genuine and is subject for further process.

○ Declaration of date of training and venue: After the previous step, operation

department give the details about the details about training date and about the venue

of the training. The training is a necessary part of the selection procedure. This

training is under the curriculum of Insurance Regulatory And Development

Authority (IRDA). The duration is 100 hours and it can be get in one ways:

Full time training (10;00 AM to 05;00 PM)

○ Testing: After completing the training conducted by IRDA, a test is conducted on the

same venue. This test is taken based on the training and contains the syllabus, which

is prescribed by the IRDA. The test and previous training is necessary for every body

that wants to become an insurance advisor.

 ○ Issue of license: After passing out the test conducted by IRDA, a license is issued

from the IRDA. This license is the proof for the insurance advisor and an advisor

can start his work just after getting this license. Getting the license is the last step in

selection process.

○ Assignment to the Unit Manager: The following advisor is assigned to a unit

manager to whom he has to report about his work and about any query concerning

about insurance and about the company.

The above are the following steps which are use to select an insurance advisors/agents. The

license issued by the IRDA is the only authorized power. This gives the person a right to do

insurance. This license is supported to renew after every three years.

ANALYSIS AND
INTERPRETATION
Q.1 From which insurance company are you insured?

CHART 1:

Analysis:-

• 60 people of the respondents are more or less with their LIC policy.

• 14 people of the respondents are more or less with their Reliance policy.

• 10 people of the respondents are more or less with their HDFC POLICY

• In this case all of those who have taken a policy have responded.
Q.2 GENDER CLASSIFICATION OF SURVEYED RESPONDENTS

CHART 2:

Analysis:

➢ Total number of male respondents – 60

➢ Total number of female respondents – 40

Q.3 CUSTOMER PROFILE OF SURVEYED RESPONDENTS

Analysis:
 ➢ 43% of the respondents are working professionals,

➢ 23% are students and 18% are into business. Therefore the target market would be

working individuals in the age group of 18 – 25 years having surplus income,

interested in good returns on their investment and saving income tax.

Q.4 INSURED PERCENTAGE

Chart 4:

ARE YO

13%

➢ 87 % of respondents were insured on own life and on life of their family

members.
 ➢ So we had 13 % of potential customers to approach.

Q.5 POPULAR LIFE INSURANCE PLANS

CHART 5 :

T
U
M
E
P
2
3
2
0
O
N
E
L
Y
9
8
%
D
IN
P
%
E
O
S
P
E
Y
sIW
M
O
O
B
E
N
F
A
N
C
T
P
P
K
L
L
A
A
N
N

Analysis:

➢ Money back Policies have been most popular and also the endowment plans.
➢ As people today are more aware about financial planning, so people of the age 30 years

have planned for their Retirement now.

➢ ULIPs are fast gaining popularity as they provide investment

benefit with Insurance.

Q.6 ARE YOU AWARE ABOUT FINANCIAL PLANNING ?

DO YOU K
FINANCIAL

Analysis

➢ 98% of the respondents were aware about Financial Planning

Q.7 CONSUMER WILLINGNESS TO SPEND ON LIFE INSURANCE PREMIUM.

Analysis:

➢ 41% of the respondents would be willing to spend between Rs. 10001 – Rs. 25000

for life insurance. 27 % would be willing to spend between Rs. 6001 – Rs. 10000 per

annum. Only 15% would be willing to spend more than Rs. 25000 per annum as life

insurance premium.. Hence to capture a larger part of the market the company could

introduce more reasonable plans with lesser premium payable per annum.
Q.8 FACTORS THAT MOTIVATE RESPONDENTS TO PURCHASE INSURANCE

Analysis:

➢ 33% of the respondents purchase life insurance to secure their families

➢ 33% take life insurance to get high returns

➢ 17% purchase insurance on the advice of their friends

➢ 13% purchase insurance because of the influence of advertisements. They can invest

their money in the equity market, debt market, money market or a combination of

these. The debt and money markets usually have low risk attached whereas the equity

market is a high risk investment option.

Q9. MINIMUM

EXPECTED

RETURN ON

INVESTMENT
Analysis:

➢ 18% of the respondents would like 16 – 20% returns,

➢ 17% would like returns between 21 – 25% and 17% would like returns of 11 – 15%

on their investments. Therefore the average return on investment should be at least

16 – 20 %.

Q.10 DATA GIVES PEOPLE’S PERCEPTION ON APPROPRIATE AGE

FOR BUYING INSURANCE?

Analysis:
• 29% of the respondents are with the view that insurance should be

bought after the age of 25 years.

• 10% of the respondents are with the view that insurance should

be bought after the age of 35 years.

• Whereas, 60 of the respondents are with the view that buying

of insurance do not have any thing to do with age i.e. there is no

age limitations. It can be purchased any time according to the

need.

RESULTS
From the above analysis it can be concluded that the competition is very tough even in the

procurement and retention of potential advisors (in the channel development process).

Reliance is the market leader in the life insurance market of private players and data show

that it is giving stiff competition to Reliance Insurance Company.

1. As the people think that insurance is a tool to protect their family & a tax saving device.

They are aware of the fact & realizing its, importance. The company should try to expand &

build up its infrastructure because there is a large potential for insurance in India.

2. Company should come up with its more branches in India. With the objective and goals to

meet the demands & expectations of the public. Because the entrance of private players will

increase the competition and it would be a tough task to secure a good position in market.

3. Since Reliance Life Insurance is leading with several companies’ policies it should be

easy for them to penetrate into the market and secure a good position if they pay greater

attention to the service part provided to their customer and thereby forming a long and

trusted relationship.
4 .As seen from the survey that at present 70% of the customer are having insurance policy

out of which 87.5% of the customer are planning for new investments. So it can be a good

potential for the company and they should make an attempt to trap these customers.

5. 43% of the customer is even ready to go for insurance if a service provider away from

their home is providing it. But intend they should provide good products and services. The

company should try to convince these customers and get them in its favour.

Though customers hope a brighter future of the company yet it has to apply a lot of efforts to

bring the market under its control.

LIMITATIONS

As we all know that for every good work there should be some leakages also. Here

leakage means some drawbacks. What I had found in my quest SUMMER TRAINING

which are expected to be as follows:

➢ Lack of proper advertisement over the market.

➢ Growing awareness is very low.

➢ Segmented area is very specific.

➢ Network over the work is very exhaustive.

➢ Company always believes their own channels.

➢ Flow of information moves very slow.

➢ Carelessness in selection procedure.

SUG GESTIONS

• Advertise about the comp any and its products – it

motiv ates indi viduals to purchase insuran ce

• Create a positi ve pe rcep tion about in surance

• Speak about the good featu res a plan offers like high

retu rns, life cover, tax benefits, indexation, accident cover

while prospec ting customers

• Try to sell the product/plan which the consumer requires

and not the plan whe re the advisor s benefit is hig her

• Imp rove the efficiency in operations

• Bring out policies with small premiums pay able for short

periods of time – Rs. 5000 – Rs. 10000 per annum for 10 years

• Attract the youth of India with higher retu rns on investment as

retu rns are t he motiv ati ng fa cto r which i nfluence pu rchase of

insurance

• Promo te insuran ce in colle ges and corp orate houses

• Promo te Reliance life insurance as an Indian Company to b uild

trust

• Reliance Life insurance could have a brand amba ssad or or a

 mas cot to promote its services

• Should have partial with drawals f rom the first year onwa rds

• Tap the rural mar ket whe re the re is la rge potential

• Diversi fy p roduct portfolio

• Make product s mo re str aight forwa rd – reduce compl exi ties

CONCLUSION
AND
RECOMMENDATIONS
CONCLUSION AND RECOMMENDATIONS

Over the next five years the Life Insurance Sector would change as it will undoubtedly be

substantially larger than it is at present and rate of returns will vary according to the fall and

rise in the market like it happened recently when market just was going up and up that the

Sensex even touched 20000 and when it fell it even went to 15000 so this variation will

always be there no doubt.

But it is really a difficult task to get clients for insurance but not impossible too if done in a

systematic way and with proper attention and sincerity.

Moreover, the success of marketing also depends on the way you interact with the customers

and how frequently you can convince the customer by getting into their mind.
Tele-calling no doubt is helpful if further process is done with sincerity but it must be

effective in itself too like if a person is out of the town he resides in then just take time to

call again later so as not to disturb him.

Another thing is that you must talk to them being friendly so that they won t think that you

are wasting their time and many other things should be kept in mind while talking to the

customers means one must know business ethics and techniques, etiquettes no doubt

required.

Try and go for indirect marketing for insurance as it becomes easy to develop contacts if

you are having references.

Yes, the very important thing is to have the good customer relations and keep them up.
Annexure
QUESTIONNAIRE

“Awareness of Financial Planning and Consumer’s Perception about Insurance

Industry”

Name: ________________________Age: _________________________

Gender: MALE FEMALE

Marital Status: Married Single

Occupation: ___________________

Contact No: __________________

1) ARE YOU AWARE ABOUT ‘WHAT IS FINANCIAL PLANNING’?

YES NO

2.DO YOU HAVE ANY INSURANCE POLICY?

YES NO

3.WHICH INSURANCE POLICY DO YOU HAVE?

LIFE NON-LIFE BOTH

4. WHICH COMPANY’S INSURANCE POLICY YOU PREFER

THE MOST? (RANK THEM)

a) LIC

b) RELIANCE LIFE INSURANCE

c) SBI LIFE INSURANCE

d) ING VYSYA LIFE

E) TATA AIG LIFE

82
F) ANY OTHER ________( Specify)

6. WHICH PLAN ATTRACTED YOU TO BUY IT?

(RANK THEM)

a)MONEY PLAN

b)PENSION PLAN

c)ENDOWMENT PLAN

d)ULIPS

e) ANY OTHER _________ (Specify)

7.WHICH IS MARKET SHARE OF THE COMPANY?

(RANK THEM)

a)HDFC STANDARD LIFE

b)BIRLA SUN LIFE

c)TATA AIG

d) ICIC PRUDENTIAL

e)OTHER

8. ARE YOU SATISFIED WITH THE POLICY?

a) SATISFIED SAVING TOOL

b) NOT SATISFIED

c) NOT RESPONDING

9.MINIMUM EXPECTED RETURN OF INVESTMENT?

a) 5%

b) 10%

(c)15%
83
d)ANY OTHER

10. WHICH FACTOR TO BE MOTIVATES RESPONDENTS TO PURCHASE

INSURANCE?

a)ADVERTISEMENTS

b)HIGH RETURNS

c) ADVICE FROM FRIENDS

d)FAMILY RESPONSIBILITIES

e)OTHER

(THANK YOU)

84
BIBLIOGRAPHY

85
REFERENCES

Books:

 Kotler Philip-Principles of Marketing

(PearsonPublishers,12th Edition,2006)

 Saxena Rajan-Marketing Management

(Tata McGraw Publishers,2nd Edition,2003)

 Kothari C.R-Research Methodology

(New Age International Publishers,2nd Edition,2004)

Magazines:

• Business World

• Business Today

• Outlook Money
86
Websites:

www.reliancelife.com

www.irdaindia.org

www.financialexpress.com

87