ankit interim report

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Summer Internship Project

Interim Report

April 19, 2010

FACULTY GUIDE NAME COMPANY GUIDE NAME

PROF. VIBHA ARORA MR. GAURAV GUPTA

IBS -G (CHANNEL DEVELOPMENT MANAGER)

HDFC STANDARD LIFE

Submitted By: Ankit Paul

Enrollment No: 09BS0000285



A REPORT

ON

“To Study the customer’s perceptions towards Life Insurance products & Recruitment

and development of Financial Consultants to help people in selecting the HDFC SLIC

product which fulfills their investments and savings need in Delhi-NCR ”

BY: ANKIT PAUL

ENROLLMENT NO: - 09BS0000285

2

http://images.google.co.in/imgres?imgurl=http://www.batchmates.com/photos/rcenterphotos/logo/LOGO4431.jpg&imgrefurl=http://ready2beat.com/technology/mobile/new-sony-ericsson-w995a-cell-phone-exposure&usg=__kL283ucFzGGSvZX915OrcW8gKtk=&h=463&w=866&sz=34&hl=en&start=1&um=1&itbs=1&tbnid=EOeMj23LqgJaoM:&tbnh=78&tbnw=145&prev=/images?q=icfai+university&um=1&hl=en&sa=N&tbs=isch:1



(HDFC STANDARD LIFE)

Contents

ABSTRACT......................................................................................................4

1. INTRODUCTION...........................................................................................5

1.1 INDUSTRY BACKGROUND.............................................................................6

1.1.1 INSURANCE..........................................................................................6

1.2 COMPANY INRODUCTION.............................................................................7

1.2.1 KEY STRENGTHS OF THE COMPANY...........................................................8

2. PROJECT DETAILS........................................................................................9

2.1 Sales Development.........................................................................................9

2.2 Channel Development....................................................................................10

2.2 .1 Hiring Financial Consultants...................................................................10

2.2.2 Hiring Business Leaders:............................................................................12

References:.......................................................................................................14

Annexure-I.......................................................................................................15

Annexure-II......................................................................................................18

Annexure-III.....................................................................................................21

Annexure-III

3



ABSTRACT

The service industry is one of the fastest growing sectors in India today. The upcoming sectors

which are really showing the graph towards upwards are – Telecom, Banking and Insurance. These

sectors really have a lot of responsibility towards the economy.

Amongst the above mentioned areas Insurance is one sector, which took a lot of time in positioning

itself. The insurance business of non- life companies was not much in problems but the major

problem was with life insurance. Life insurance Corporation of India had monopoly for more than

45 years, but the picture then was completely different. Previously people felt that “Insurance is

only for classes not for masses” but now the picture has changed.

I have tried to study this changed picture where people have now started investing in private life

insurance companies. I did this by preparing a questionnaire, removed the redundant and irrelevant

questions from it and then did survey in some of the companied in Delhi-NCR. This survey studies

the perceptions of people on life insurance products, their basic knowledge on the products and

their preferences on LIC and some top private players. I did this with a view of curbing any

misconceptions if they exist among people by educating them and convincing them to go for the

products of private insurance companies instead of LIC.

For this, I needed a pool of prospective insurance agents called the financial consultants who wouldgive a complete knowledge about the product to the customers which is well suited to them based

on their financial need. So recruiting the agents was also a part of my work for the company which

I have completed satisfactorily.

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The new task provided by the company to me in this financial year which I am working on is to

recruit good agents of other insurance companies and convincing them to work for HDFC Standard

life by offering them good incentives, status and a post of ‘Business Leader’ in the company. I

hope to achieve this target by the time my internship ends.

1. INTRODUCTION

The story of Insurance is probably as old as the story of mankind. The same instinct that prompts

modern businessmen today to secure themselves against loss and disaster existed in primitive men

also. They too sought to avert the evil consequences of fire and flood and loss of life and were

willing to make some sort of Insurance is largely a development of the recent past, particularly

after the industrial era- past few centuries- yet its beginning date back almost 6000 years.

The formation of IRDA, entrance of private life insurance companies into India with one foreign

partner, compulsory training of insurance agents etc, and development started to take place. And

this was the time when these companies started searching for proper channel partners who can help

the organization in expanding its network and business in India.

Channel partners are those who are going to be into direct selling of company’s products i.e. the

insurance policies. They are the link between the customers and the management or company.

These channel partners are people with different motives. They are selected on some grounds like

their network, their problem handling ability, convincing ability and lot of other things.

The main idea behind company’s Questionnaire Survey is to find out and analyze the proper profile

that can be recruited by company as a channel partner. Company has been focusing on some of the

profile that can be very beneficial for the company. For example chartered accountants, tax

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consultants, postal agents, bank’s daily collection agents etc. the main idea behind targeting the

above profile is strong client network which is really very important for an insurance company.

The scope for private insurance companies has great opportunities to cover the market and can

insure the customer. With the initiation of the deregulation in the Indian insurance market has been

broken, new private players have entered the market and with their innovative approaches and

better use of distribution and with their innovative approaches and better use of distribution

channels and technology, they are eating in to the shares of established public sector companies in

Indian insurance market. Since the deregulation has been put in to place, the market share of LIC

has come down to 71.4% in life insurance market while the private players have captured around

17% market in general insurance segment. This report includes the key private insurance market

such as HDFC STANDARDLIFE, ICICI PRUDENTIAL LIFE, MAX NEWYORK LIFE, KOTAK

etc. it also includes the leading competitors in the life insurance segments with their market shares.

1.1 INDUSTRY BACKGROUND

1.1.1 INSURANCE

Insurance is a contract providing for payment of a sum of money to the person assured or failing

him to the person entitled to receive the same on the happening of certain event. Uncertainty of

death is inherent in human life. It is this risk, which gives rise to the necessity for some form of

protection against the financial loss arising from death. Insurance substitutes this uncertainty by

certainty.

The objective of insurance is normally to provide;

a) Family protection and/or

b) Provision for old age

c) Protection against risks

1.1.2 Why insurance?

Insurance cover is essential because it provides the following benefits:

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➢ A lump sum payment to the nominees at the time of the death of the policy holder.

➢ A regular payment to the nominees in the event of the death of the policy holder.

➢ Tax benefits, as premiums paid reduce the liability of tax.

➢ Relieves economic hardships in the family on the uneventful death of the sole income

holder.

➢ Inculcates the habit of savings.

➢ Superior to an ordinary savings plan as it provides full protection against risk of death.

➢ Encourages and forces compulsory savings unlike other saving instruments wherein the

saved money can be easily withdrawn.

1.2 COMPANY INRODUCTION

HDFC STANDARD LIFE is one of India’s leading private life insurance companies, which offers

a range of individual and group insurance solutions. It is a joint venture between Housing

Development Finance Corporation Limited (HDFC), India’s leading housing finance institution

and STANDARD LIFE, a leading provider of financial services in the United Kingdom.

HDFC STANDARD LIFE’S product portfolio comprises solutions, which meet various customer

needs such as protection, pension, savings, investments and health.

HDFC Incorporated in 1977 with a share capital of Rs. 10 Cr. HDFC has since emerged as the

largest residential mortgage finance institution in the country. The corporation has had a series of

issued raising its capital to Rs. 119 Cr. The gross premium income for the year ending March 31,

2009 stood at Rs. 5,564.69 Cr. The company during the current year registered a positive growth of

14.53%. The sum assured in force for the current year was Rs. 57,158 Cr. as compared to Rs.

45,753 Cr. for the previous year.

HDFC operates through almost a network of 595 cities serving over 720 cities and towns across the

country. The company has increased its depth in existing markets with a strong base of more than

207,000 financial consultants, having its head quarters in Mumbai. HDFC also has an international

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office in Dubai, UAE with service associates in Kuwait, Oman and Qatar. HDFC is the largest

housing company in India for the last 33 years.

HDFC standard life was one of the first private companies to get license and allowed to do business

in the insurance sector. HDFC is RATED ‘AAA’ by CRISIL and ICRA. Similarly STANDARD

LIFE is rated ‘AAA’ by MOODY’S AND STANADARD AND POOR’S. This reflects the

efficiency with HDFC and STANDARD LIFE manages their asset base of Rs. 15000 Cr. and Rs.

600000 Cr. respectively.

HDFC STANDARD LIFE was incorporated on 14th August 2000. HDFC is the majority

stakeholder in insurance JV with 76% staple and STANDARD LIFE of as a staple of 24%. Mr.

Amitabh Chaudhary is the MD and CEO of the venture. Since inception, HDFC SL is continuously

among the top three private players which has performed up to the mark as par the consumer

satisfaction.

1.2.1 KEY STRENGTHS OF THE COMPANY

➢ FINANCIAL EXPERTISE

➢ RANGE OF SOLUTIONS

➢ STRONG ETHICAL VALUE

➢ MOST RESPECTED PRIVATE COMPANY

➢ CORPORATE AGENTS

➢ SOLVENCY

➢ DISTRIBUTION

➢ FINANCIAL CONSULTANTS

My internship is under Mr. Pradeep Kapai (Branch manager), Mr. Gaurav Gupta (Channel

Development Manager) and MR. Harpreet Chhatwal (Sales Development Manager). The aim of

this department is to promote financial products offered by the company and to recruit the potential

financial consultants who can become the face of the company and promote the financial products

of the company in such a way which can meet with the needs of the consumers.

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The company has covered over 10, 00,000 lives year ending by March 31, 2009. The company was

also awarded the corporate citizen of the year award for its long standing commitment to

community development.

1. PROJECT DETAILS

My project is divided into two parts; Sales Development and Channel Development. The Sales

development project is under Mr. Pradeep Kapai (Branch Manager, Paschim Vihar Branch, New

Delhi) and Mr. Harpreet Chatwal (Sales Development Manager, Paschim Vihar Branch, New

Delhi). The Channel Development project is under Mr. Gaurav Gupta (Sr. Channel Development

Manager, Rohini Branch, New Delhi). Now I will discuss the two projects in detail.

2.1 Sales Development

In sales development, my job role is to analyze the financial need of the customer and offer him the

insurance product that suites him the best. Following are the challenges in this project.

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i. Find Potential Customers: The most challenging task in this project was to find the

potential customers who are willing to invest to get future financial security or get good

returns or save tax. So I decided to target the company employees who need to invest but

don’t have sufficient knowledge or those who are not aware of their need to invest and the

benefits of investing in insurance.

ii. Research Work: Now meeting each and every employee of the company and asking them

for investing by accessing their need is a bit hectic and monotonous. So I decided to prepare

a questionnaire that could access the knowledge and need of investment of the employees in

insurance. This survey would also scan the perception of employees towards insurance and

image of LIC and other private players in their mind (a copy of survey is shown in

Annexure I).

Then a validity test was conducted to check whether or not the questionnaire developed is

valid to carry out the survey and achieve the desired objective. For this, I took a sample of

20 people in my locality and carried out the survey. When the answers of these 20 people

were analyzed, I found some of the questions were redundant and show same results and

some questions were not needed for this project. So these questions were removed.

iii. Reach to the Customers: Next challenge was to personally go to each and every employee

of the companies that I have taken appointment in and then carry out a survey. To solve this

problem, I developed a web-based survey and mailed it to the employees of the companies

(a copy of this web-based survey is shown in Annexure II).

iv. Collect the data: Next step is to collect the data from the customers in form of

questionnaire. I am in the process of this data generation. I have mailed the questionnaire to

about 300 people and I am expecting the desired 200 filled questionnaire. So my sample

size is 200.

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v. Analyze the filled questionnaire: Then my next step is to analyze the filled questionnaire

to find out the perception of these people towards insurance and find out that whether these

people have favorable or unfavorable response towards insurance and HDFC Standard Life.

Some questions regarding products asked in the questionnaire are facts of insurance.

vi. Personal Meeting: Now those people, who answer these questions wrongly, do not know

much about insurance and these people need to be educated on insurance to change their

perception and curb their misconceptions towards insurance. For this, I will try to meet as

many people personally as possible and also try to persuade them to invest with HDFC

Standard Life.

vii.Customers’ Data-Base Generation: The details of prospective customers and the

converted customers who show interest in investing that time or some time later in the

future will be added to the customers’ data-base so that they can be easily tracked

periodically to bring more and more business to the company.

2.2 Channel Development

In channel development, my job role is to find, select, recruit, develop and motivate the financial

consultants and business leaders to carry out sales and bring business to the company for the

company in following way:

1.2.1 Hiring Financial Consultants

Financial consultants are hired in the following manner:

i. Search for Prospective Financial Consultants: I have to search for the people

who have some or all free time and want to work in that free time dedicatedly,

flexibly, from office or from home or on field to earn good money (in the form of

commissions). Following strategies are incorporated to search for the people

interested to work on this profile:

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a) Presenting the profile in the management school and pick up students

pursuing B.B.A, M.B.A etc. in their internship.List of institutes visited

for recruiting the prospective financial consultants are given in Annexure

III.

b) Pitching the sales profile to all kinds of salesmen e.g. selling broadband

connections, selling in retail stores etc. who have sold insurance before

and others.

c) Personal contacts like friends, relatives etc. if they show interest in the

profile.

d) Housewives who frequently arrange kitty parties, who want to work from

home and those who want to earn but can’t go to office due to any

reasons.

i. Select from the pool of interested people: Selecting the right person for this job is

a difficult job and depends upon knowledge of insurance, selling experience, his

contacts with people, skills of forming good relations with people, convincing

ability etc.

ii. Recruiting involves the process of filling up the application form for insurance

agency, collection of necessary documents like class 12th mark sheet, cancel cheque,

PAN Account No. etc.

iii. Developing involves the process of training them on the guidelines of IRDA to

make them capable and eligible for writing the agency test conducted by IRDA

before it grants license to sell insurance. Once the license is generated, HDFC’s

professional trainers provide product knowledge and refine selling skills by giving

the different pitching methods for different products.

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iv. Motivating involves the process of getting best out of the Financial Consultants,

helping them in arranging and converting customer calls and extracting maximum

business from the Financial Consultants.

2.2.2 Hiring Business Leaders:

The concept of business leaders is new to HDFC Standard Life. It is a purely new

profile given to people who are already good agents of other insurance companies.

These agents will keep working for their existing companies even after being hired

as Business Leaders of HDFC Standard Life. But these business leaders have to

recruit Financial Consultants for HDFC Standard Life under them, guide them or give them leads to generate sales and bring business to the company. Now if these

financial consultants bring business to the company, apart from the commissions

given to these financial consultants, company is also liable to pay pre-determined

incentives to these business leaders ranging from Rs 3,800 on Rs 50,000 business to

Rs 1, 40,000 on Rs 20, 00,000 business provided by all the financial consultants

under him taken together. This is a strategy to attract good agents towards HDFC

Standard Life and hence reduce competition at lowest possible cost.

Agents have to meet any one of the following eligibility conditions:

i. If he has done a business of at least Rs 20L or has earned a commission of at

least Rs 2L in the last financial year, he will be considered as such.

ii. If he has done a business of at least Rs 10L or has earned a commission of at

least Rs 1L in the last financial year, he has to give 3 recruitments upfront at

the time of contract.

iii. If he is a member of Million Dollar Round the Table conference (MDRT),

held in America or is a member of Top Of the table (TOT) or Center Of the

Table (COT), he will be considered directly.

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References:

Websites

i. http://www.hdfcinsurance.com

ii. http://financialanswers.com/mc6/topic.php?b=24549975-

1&c=897&h=506,1578,895

iii. http://www.licindia.com

iv. http://ezinearticles.com/?expert=Adam_Singleton

v. www.business.mapsofindia.com

vi. www.bajajcapital.com

vii.www.moneycontol.com

viii.www.irdaindia.com

ix. www.tns-global.com

x. www.indiatimes.com

Reports

i. Annual Report of HDFC Standard Life (2009)

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http://ezinearticles.com/?expert=Adam_Singleton

http://www.business.mapsofindia.com/

http://www.bajajcapital.com/

http://www.moneycontol.com/

http://www.irdaindia.com/

http://www.tns-global.com/

http://www.indiatimes.com/

http://ezinearticles.com/?expert=Adam_Singleton

http://www.business.mapsofindia.com/

http://www.bajajcapital.com/

http://www.moneycontol.com/

http://www.irdaindia.com/

http://www.tns-global.com/

http://www.indiatimes.com/



Annexure-I

A Survey on Insurance

Name: Company:

Phone: Annual Salary:

1. Do you think you have sufficient insurance that makes yours and your family’s future

secured against any contingency that may arise in future?

Yes No Can’t Say

2. What financial needs are fulfilled by insurance products for you?

(Two or more options can be marked)Tax Saving Return on Investment

Death assurance Survival Benefits (Money back or Pension)

3. On what parameters does the growth and decline of fund value depend?

Growth & decline in the market Grows at constant rate irrespective of market

Growth & decline depends on the customer’s choice of funds (Equity or Debt)

None

4. Insurance is a need for

a person who is married a person who is employed

a person who has children everybody

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5. Do you think insurance is a way to solve all or most of your financial problems?

Yes No Can’t Say

6. Children plans are beneficial for

people who have children who are dependent on them.

people who just have a child born in their family.

anybody who is perceived to be benefited by a of money lump sum amount in future.

people who are financially unsound to afford higher education of their children.

7. Pension plans are beneficial to a person

who is retired. who doesn’t gets pension from his company.

who has sufficient job period to build enormous fund for his comfortable pensioned life

after retirement.

whose children will not care for the after their retirement.

8. Which is the best source of investment?Mutual Funds Real-Estate Insurance Any other None

9. Charges deducted in insurance plans

are justified & need to be told to customers are justified & needn’t be told

are not justified but need to be told are not justified & needn’t be told

Rank the companies on parameters given in following questions from 1-5.

1-Excellent 2-Good 3-Fair 4-Satisfactory 5-Unsatisfactory

10. Reliability

HDFC Standard Life ICICI Prudential LIC

17



Max-Newyork Life Bajaj Allianz

11. Reputation



12. Ethics of company & its agents



13. Product Innovation



14. Charge Justification



15. In which company would you like to invest with and why?

18



Annexure-II

A Survey on Insurance

1. Default Section

1. Please enter your personal details.

Name:

Company:

Phone Number:

2. What financial needs are fulfilled by insurance products for you?

(Two or more options can be marked)

Tax Saving Return on

Investment

Death assurance Survival Benefits

(Money back or

19



Pension)

3. Do you think insurance is a way to solve all or most of your financial problems?

Yes No Can't Say

4. Children plans are beneficial for

people who have

children who are

dependent on them.

people who just

have a child born in

their family.

anybody who is

perceived to be

benefited by a of money

lump sum amount in

future.

people who are

financially unsound to

afford higher education

of their children.

5. Pension plans are beneficial to a person

who is retired. who doesn’t gets

pension from his

company.

who has sufficient

job period to build

enormous fund for his

comfortable pensioned

life after retirement.

whose children will

not care for the after

their retirement.

6. Which is the best source of investment?

Mutual Funds Real Estate Insurance Any Other None

7. Rank the companies on parameters given in following questions

Charges Justification

Unsatisfactory Satisfactory Fair Good Excellent

HDFC StandardLife

ICICI Prudential

20




LIC

Max-New York

Life

Bajaj Allianz


Reputation


HDFC Standard

Life

ICICI Prudential

LIC

Max-New York Life

Bajaj Allianz


Ethical behavior of company & its agents


HDFC Standard

Life

21




ICICI Prudential

LIC

Max-New York

Life

Bajaj Allianz

10. In which company would you like to invest with and why?

22



Annexure-III

Recruitment of Project Trainees from B-Schools

1. BLS Institute of Management

Campus-Opposite Mohan Meakin Factory, B-8,

Loni Road, Mohan Nagar, Gaziabad-201007

(95120-2658405, 2657654, 2657632)

[email protected]

www.blsim.com

2.Rukmini Devi Institute of Advanced Studies

2A&2B, Phase-I, Madhuban Chowk,

Rohini,Delhi-110085

( 27867301,27864596)

[email protected] : http://www.rdias.org

3. Tecnia Institute of Advanced Studies

3, PSP Institutional Area, Madhuban Chowk,

Rohini, Delhi-110085(27555121-24)

[email protected]

http://www.tecniaindia.org

4.BLS Institute of Technology Management

Rohtak Road, NH-10, Jhakoda Bahadurgarh

01276-215822.241822,241122

[email protected]

5.Kasturi Ram College of Higher Education

Narela Delhi-40

27787132, 27784774

[email protected]

www.krcollege.in

6.Management Education & Research Institute

53-54, Institutional Area, Opp.D Block,Janak

Puri, New Delhi – 58

28522201/02/03 /04

[email protected]

www.meri.edu.in

7.Amity University

block E2

amity university campus

sector 125, noida 201303 (UP)

8. Mount carmel school, dwarka

Sector - 22, Phase - 1, Dwarka

New Delhi - 110075

India

Phone : 91-11-28052001,28052002

Fax : 91-11-28052003

23

http://www.blsim.com/

mailto:[email protected]


http://www.tecniaindia.org/


http://www.krcollege.in/

http://www.meri.edu.in/

http://www.blsim.com/


http://www.tecniaindia.org/


http://www.krcollege.in/

http://www.meri.edu.in/



Preschool : 91-11-28051131, 28052301

E-mail : [email protected]

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