A STUDY ON CUSTOMER PREFERENCES OVER LIFE INSURANCE

BY KUMARI JYOTHI 1225110224

CONTENT
About Life Insurance Industry profile Organization profile Analysis Findings Suggestion Conclusion

What is Life Insurance?

Life insurance is a contract between an insurance policy holder and an insurer, where the insurer promises to pay a designated beneficiary a sum of money (the "benefits") upon the death of the insured person.
The goal of life insurance is to provide a measure of financial security for your family after you die. So, before purchasing a life insurance policy, you should consider your financial situation and the standard of living you want to maintain for your dependents or survivors.

Life-based contracts tend to fall into two major categories:

Protection policies designed to provide a benefit in the event of specified event, typically a lump sum payment. A common form of this design is term insurance. Investment policies where the main objective is to facilitate the growth of capital by regular or single premiums. Common forms (in the US) are whole life, universal life and variable life policies.

Why to have a life insurance?

Protection Liquidity Tax relief Money when u need it

INDUSTRY PROFILE
The concept of insurance is believed to have emerged almost 4500 years ago in the ancient land of Babylonia where traders used to bear risk of the carvan by giving loans, which were later repaid with interest when the goods arrived safely. TIME LINE IN INSURANCE HISTORY 1818 British introduced the life insurance to India with the establishment of the Oriental Life Insurance Company in Calcutta. 1850 Non life insurance started with Triton Insurance Company. 1870 Bombay Mutual Life Assurance Society is the first India owned life insurer.

 1912 The Indian Life Assurance Company Act enacted to regulate the life insurance business.
1938 The Insurance Act was enacted.

1956 Nationalization took place. Government took over 245Indian and foreign insurers and provident societies. 1972 Non-life business nationalized, General Insurance Corporation (GIC) came into being. 1993 Malhotra committee was constituted under the chairmanship of former RBI chief R. N. Malhotra to draw a blue print for insurance sector reforms.

1994 Malhotra committee recommended reentry of private players.

History of life insurance

Risk protection has been a primary goal of humans and institutions throughout history. Protecting against risk is what insurance is all about. Over 5000 years ago, in China, insurance was seen as a preventative measure against piracy on the sea.

 Insurance in India can be traced back to the Vedas. For instance, yogakshema, the name of Life Insurance Corporation of India's corporate headquarters, is derived from the Rig Veda. The term suggests that a form of "community insurance" was prevalent around 1000 BC and practiced by the Aryans. And similar to ancient Rome, burial societies were formed in the Buddhist period to help families build houses, and to protect widows and children.

KEY FEATURES OF LIFE INSURANCE

1) Nomination: When one makes a nomination, as the policyholder you continue to be the owner of the policy and the nominee does not have any right under the policy so long as you are alive. The nominee has only the right to receive the policy monies in case of your death within the term of the policy.

2) Assignment: If your intention is that your policy monies should go only to a particular person, you need to assign the policy in favor of that person.
3) Death Benefit: The primary feature of a life insurance policy is the death benefit it provides. Permanent policies provide a death benefit that is guaranteed for the life of the insured, provided the premiums have been paid and the policy has not been surrendered. 4) Cash Value: The cash value of a permanent life insurance policy is accumulated throughout the life of the policy. It equals the amount a policy owner would receive, after any applicable surrender charges, if the policy were surrendered before the insured's death. 5) Dividends: Many life insurance companies issue life insurance policies that entitle the policy owner to share in the company's divisible surplus

 6) Paid-Up Additions: Dividends paid to a policy owner of a participating policy can be used in numerous ways, one of which is toward the purchase of additional coverage, called paid-up additions.
7) Policy Loans: Some life insurance policies allow a policy owner to apply for a loan against the value of their policy. Either a fixed or variable rate of interest is charged. This feature allows the policy owner an easily accessible loan in times of need or opportunity.

8) Conversion from Term to Permanent: When in need of temporary protection, individuals often purchase term life insurance. If one owns a term policy, sometimes a provision is available that will allow her to convert her policy to a permanent one without providing additional proof of insurability.
9) Disability Waiver of Premium Waiver of Premium is an option or benefit that can be attached to a life insurance policy at an additional cost. It guarantees that coverage will stay in force and continue to grow

RELIANCE LIFE INSURANCE

Reliance Life Insurance Company Limited is a part of Reliance Capital Ltd. of the Reliance Anil Dhirubhai Ambani Group. Reliance Capital is one of Indias 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 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 Life Insurance is another steps forward for Reliance Capital Limited to offer need based Life Insurance solutions to individuals and Corporate. Reliance Capital Limited announced the launch of its life insurance business on February 1, 2006. This was after obtaining the required regulatory approvals from the Registrar Of Companies and the Insurance Regulatory and Development Authority.

 Reliance Life Insurance Company Limited has offered 9 traditional plans to the customers, which are listed as follows: 1) Reliance Term Plan 2) Reliance Whole Life Plan 3) Reliance Child Plan 4) Reliance Endowment Plan 5) Reliance Special Endowment Plan 6) Reliance Cash Flow Plan 7) Reliance Credit Guardian Plan 8) Reliance Special Credit Guardian Plan

 1) Reliance Term plan: This insurance policy is designed for those who only want life cover for the protection of their family, and do not wish to save for themselves. 2) Reliance Whole Life Plan: This insurance policy is designed for people who do not wish to avail of any benefits themselves but wish to create an immediate estate to protect their family by availing of insurance cover on their life at a very low cost. 3) Reliance Child Plan: This insurance policy is designed for people who wish to save money for a future time when there will be a recurring need for substantial amounts of money.

 4) Reliance Endowment Plan: Reliance Life Insurances Reliance Endowment Plan is the key to all your financial needs. It is an inexpensive and easy way to protect you, your family or your business. 5) Reliance Special Endowment Plan: This insurance policy is designed for people who wish to combine savings with extended security. The unique feature of this policy is that life protection continues for five years after you have stopped the payment of premium. 6) Reliance Cash Flow Plan: This insurance policy is designed for those who have a recurring need for reinvestment in business or look for short-term investment channels.

 7) Reliance Credit Guardian Plan: This insurance policy is designed for those who not only safeguards individuals but also families and businesses from the financial hardship that could arise from unfortunate and unexpected death.
8) Reliance Special Credit Guardian Plan: This insurance policy is designed for those who not only safeguards individuals but also families and businesses from the financial hardship that could arise from unfortunate and unexpected death, disability or critical illnesses.

UNIT LINKED PLAN A unit-linked policy is a life assurance policy in which the benefitsdepend on the performance of a portfolio of shares.Each premium paid by the insured person is split: a part is used to provide life assurance cover, while the balance (after the deduction of costs,expenses, etc.) is used to buy units in a unit trust. Reliance Life Insurance Company Limited has also offered the two Unit Linked Plans, which are listed as follows: 1) Reliance Market Return Plan 2) Reliance Golden Years Plan

Market share of Life Insurance companies

RESEARCH METHODOLOGY
PURPOSE /NEED FOR STUDY This project will help Reliance Life Insurance Company Private Limited to know customer preference over life insurance and its market share in India. By knowing this the company can understand where does it stand in comparison to other market players. By following this reports new strategy can be adopted to increase market share of the company. OBJECTIVE 2) To improve our ability to sell a financial product like life insurance. 3) To know the perception of the consumer about life insurance. 4) To get a deep knowledge of the financial product like insurance. 5) To get some information about the market share of Reliance Life Insurance as compared to the giants like LIC and to know the standing of the company in the market

SCOPE OF THE STUDY

A big boom has been witnessed in Insurance Industry in recent times. A large number of new players have entered the market and are vying to gain market share in this rapidly improving market. The study deals with Reliance in focus and the various segments that it caters to. The study then goes on to evaluate and analyse the findings so as to present a clear picture of trends in the Insurance sector.

RESEARCH DESIGN The methodology used for preparation of this project is easy and the language used is simple to understand The fact, figures and data used in this project are true and have been derived directly from the secondary data. In addition to following Pie Charts , Flow Charts and Tables have also been used.

DATA ANALYSIS

1.The house you reside is owned or rented?

Financial status

Own 47%

Rented 53%

2. Which vehicle do u Own( 2 /4 Wheeler) ?

Vehicles
Both 5% Four wheeler 15% No 5%

Two wheeler 75%

3. What are your financial goals?

Financial goal

Short term 45% Long term 55%

4. Your Interest towards Investments

Interest towards investment
Capital preservation 10%

Capital appreciation and income generation 25% Income generation 65%

5. According to you which one is the best option for saving?

Various saving options
Insurance 15% Real estate 5% Mutual fund 10% Bank 27%

Share market 8%

gold 20%

post office saving 15%

6. Do you think insurance is important?

Importance of insurance
No 15%

Yes 85%

7. Do you have any insurance policy? If Yes which plan & what is the coverage

Policies

Preference of insurance companies

ICICI Max new york 3% 10%

No 5%

HDFC 11%

LIC 68% yes 95% Reliance life insurance 8%

11. What is your main motive behind investing in life insurance?

Various motives for investment
Return/Yield 7% tax benefit 20% Family protection 45%

Savings 28%

12. : Which life insurance policy would you prefer to buy?

Preference for various plan
Unit Linked 3% health plan 10%

protection plan 25%

Child plan 62%

13. How do you decide about investing in life insurance?

Investment Decision
On my Own decision 10%

Financial advisor 28%

Employer decision 14%

Family decision 48%

14. :Do you feel whether private insurance companies are beneficial?
Private insurance are beneficial

Strongly disagree 20%

Strongly agree 15%

Disagree 23% Agree 42%

15. Do you feel health insurance is worth opting for as expense on health treatment increasing day by day?
Preferences of Health Insurance
Strongly agree 10% Strongly disagree 29%

Disagree 4%

Agree 57%

16 In insurance companies which company do you prefer?.

PREFERENCES OF INSURANCE COMPANIES
Reliance Life insurance 8% Any other 25% ICICI redutial 5%

Bajaj Alliance 5%

Max life new york 37%

HDFC Standard life insurance 20%

FINDINGS

SUGGESTION

CONCLUSION

 THANK U