chapter -iv analysis and...

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CHAPTER -IV

ANALYSIS AND INTERPRETATIONS

The decision to purchase insurance reflects a loving commitment to

family and recognition of the need to meet other financial responsibilities. Life

insurance has always been one of the most cost effective ways for men and

women to protect their loved ones, providing the assured future. But, many

women have either no or too little life insurance. Historically, women were

almost never adequately insured. Even in U.S., as recently as, 1977, adult males

accounted for 57 per cent of all life insurance policies purchased, according to

the American Council of Life Insurance. Women were listed as the insured on

just 29 per cent of policies purchased. Coverage on men accounted for 85 per

cent of the total dollar amount of protection. Coverage on women amounted to

just 10 per cent of the total. Today, 59 per cent of women have at least some life

insurance, compared to 64 per cent of men. On the other hand, coverage amounts

for women still lag. The average death benefit on men is nearly double that for

women.http://www.raminfo-insuranceonline.com/documents/AgentsProfile.aspx)

In India, over the ages, traditionally, women have been home makers.

Today, women have moved on from being just homemakers to breadwinners,

often playing multi-dimensional roles as professional, homemaker, mother and

financial planner. So, insurance is as much a necessity for them as it is for men.

For a good long time, insurance companies offered covers only for men. A few

offered products for women, but with restrictive conditions and higher premiums.

But, things started changing with the formation of the Life Insurance Corporation

of India (LIC). After nationalization, LIC started covering female lives also in

more meaningful terms. Still, large number of insurable population remains

uninsured and majority of the women who take up the life cover are found under

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insured. In this chapter, the views expressed by the women policy holders, are

summarized, and analysed and due interpretations are given. As said earlier,

there are equal number of respondents from category I women i.e., women with

earned income or professionals, mainly from organized sector and from category

III women i.e., self employed women and others who are mainly from

unorganized sector in this study.

Table 4.1 Age Composition of the Women Policy Holders

Age in Years Category I Category III Total Percentage

Below 30 10 38 48 24

31 -40 38 31 69 34.5

41-50 32 16 48 24

Above 50 20 15 35 17.5

Total 100 100 200 100

Source: Primary data

The above table shows that 24 per cent of the women policy holders in

the sample selected are below the age group of thirty, 34.5 per cent are in the age

group of thirty one to forty years, 24 per cent are in the age group of forty one to

fifty years and the rest 17.5 per cent are belonging to the age group of above fifty

years. From the sample selected, a maximum of 38 women in organized sector,

classified as Category I by LIC, are belonging to the age group of 31-40 and

among the women in unorganized sector, classified as Category III by LIC,

higher frequency of 38 women are belonging to the age group of below 30 years.

Table 4.2 Marital Status of the Women Policy Holders

Marital Status Category I Category III Total Percentage

Married 71 85 156 78

Single women 29 15 44 22

Total 100 100 200 100


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The table shows that 78 per cent of the women policy holders in the

sample selected are married and 22 per cent are single women. Single women in

this research, include women unmarried, widowed, and separated also. Of the

women respondents in organized category, 71 per cent are married and in the

unorganized category, 85 per cent are married. Similarly, 29 per cent of the

single women are from organised category and 15 per cent of single women

belong to the unorganized category.

Table 4.3 Religion of the Women Policy Holders

Religion Category I Category III Total Percentage

Hindus 72 60 132 66

Muslims 7 14 21 10.5

Christians 21 26 47 23.5

Total 100 100 200 100



sample selected are Hindus, 23.5 per cent are Christians and 10.5 per cent are

Muslims in total. Of the women in the organized category interviewed, 72 are

Hindus, 21 are Christians and 7 are Muslims. Women in the unorganized

category, include 60 Hindus, 26 Christians and14 Muslims.

Table 4. 4 Size of the Family of the Women Policy Holders

Family Size Category I Category III Total Percentage

2 Members 3 3 6 3

3 Members 15 8 23 11.5

4 Members 49 43 92 46

5 Members 11 9 20 10

More than 5 22 37 59 29.5

Total 100 100 200 100

Source: Primary Data

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sample selected are of the family size of 4 members and only 3 per cent selected

are of the family size of 2 members. Of the women in organized category 49 per

cent are of the family size of 4 members and only 3 per cent are of the family

size of 2 members. Similarly of the women in unorganized category 43 per cent

are of the family size of 4 members and only 3 per cent is of the family size of 2

members.

Table 4. 5 Education of the Women Policy Holders

Level of Education Category I Category III Total Percentage

School Education 19 58 77 38.5

Graduation 8 29 37 18.5

Post Graduation 39 10 49 24.5

Technical Education 34 3 37 18.5

Total 100 100 200 100


The table computed from surveyed data reveals the level of education

among women policy holders. The table shows that 38.5 per cent of policy

holders did their school studies, 18.5 per cent of them completed their

graduation, 24.5 per cent of the policy holders completed their post graduation

and 18.5 per cent of them have undergone technical education.

Table 4. 6 Monthly Income of the Women Policy Holders

Monthly Income (in Rs.) Category I Category III Total Percentage

Below 5000 0 74 74 37

5000-10000 35 22 57 23.5

Above 10000 65 4 69 34.5

Total 100 100 200 100


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sample selected are earning the monthly income of less than Rs.5000, and all are

from unorganized category i.e., of the 100 sample respondents from the

unorganized category 74 are from this income group. Similarly, 34.5 per cent of

the women policy holders in the sample selected are earning the monthly income

of above Rs. 10,000 and are mainly from organized category i.e., of the 100

sample respondents from the organized sector 65 are from this income group.

Table 4. 7 Family Income of the Women Policy Holders

Family Income (in Rs.) Category I Category III Total Percentage

Below .5000 0 2 2 1

5000-10000 10 71 81 40.5

Above 10000 90 27 117 58.5

Total 100 100 200 100


The table showing the family income of the women policy holders reveals

that only one per cent of the family of the women policy holders in the sample

selected are earning the monthly income of less than Rs.5000, 40.5 per cent of

the families are in the monthly income range of Rs.5000-8000and 58.5 per cent

of the families are in the monthly income range of above Rs.10000. While 90 per

cent of the families of the women policy holders from organized category are

earning the monthly income of above Rs. 10000, only 27 per cent of the families

of the women policy holders from unorganized category are in this earning

group. Similarly, while, 71 per cent of the families of the women policy holders

from unorganized category are in the monthly income slab of above Rs.5000-

10000, only 10 per cent of the families of the women policy holders from

organized category are in this earning group.

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Table 4.8 Monthly Entertainment Expenses of the family of Policy Holders

Entertainment Expenses

(in Rs)

Category I Category III Total Percentage

Below Rs.100 2 70 72 36

Rs.100 - 200 53 22 75 37.5

Above Rs. 200 45 8 53 26.5

Total 100 100 200 100


The above table shows that 36 per cent of the women policy holders in the

sample selected is spending below Rs.100 per month as entertainment expenses,

37.5 per cent of the respondents in the sample selected are spending between

Rs.100and Rs.200 per month, and the rest 26.5 per cent are spending above

Rs.200 per month as entertainment expenses. While, 70 per cent of the families

of the respondents from unorganized category are spending below Rs.100 per

month as entertainment expenses, only two per cent of the respondents from

organized category are in this spending group. Similarly, while 98 per cent of the

families of the women policy holders from organized category are spending

above Rs.100 per month as entertainment expenses, only 30 per cent of the

respondents from organized category are in these spending slabs.

Table 4.9 Number of Policies taken by the Women Policy Holders

Number of Policies Category I Category III Total Percentage

Single policy 42 95 137 68.5

Two policies 33 4 37 18.5

Three policies 14 0 14 7

Four policies 7 1 8 4

More than four policies 4 0 4 2

Total 100 100 200 100


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The above table shows that 68.5 per cent of the women policy holders in

the sample selected have taken only one life insurance policy, which is followed

by 18.5 per cent taking two life insurance policies. Of the women policy holders

from unorganized category only 5 per cent have taken more than one life

insurance policy, whereas 58 per cent women policy holders from unorganized

category have taken more than one life insurance policy.

The reason that women policy holders in organized category are not

contented with single policy may be because of seeking more risk cover

corresponding to their income hikes. Moreover, women policy holders in

organized category are comparatively aware of the benefits of the policies newly

introduced and to take advantage of the same, more than a policy might have

been taken by them.

Table 4.10 Nature of Policies taken by the Women Policy Holders

Nature of Policies Category I Category III Total

Whole Life Policy 23 16 39

Term Insurance 3 2 5

Money Back Policy 77 54 131

Annuity 5 1 6

Health Policy 12 1 13

Endowment 53 37 90

Ulip & Others 5 1 6

Total 178 112 290


Term assurances are the purest and cheapest form of insurance but

benefits are payable only on the death of the policy holder within the term.

Whole life plans are a special type of term assurance wherein the term of the

policy is whole of the life. The above table shows that 23 women policy holders

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in the sample selected have taken whole life insurance policy and three of them

chose term insurance cover. Of the women policy holders from unorganized

category 16 have taken whole life insurance policy and 2 of them chose term

insurance cover.

The endowment plan benefits are payable on death within the term or

survival to maturity which ever is earlier and thus it acts as both risk cover as

well as a channel of savings. Money back policies are also called anticipated

endowment assurance plans. Survival benefits are spread over the term of policy

and certain percentage of sum assured is paid at regular intervals. The death

benefit continues like endowment plan i.e., full sum assured shall be payable on

death within the term irrespective of earlier survival benefits.

Among the respondents, 77 and 53 women policy holders from organized

category have taken money back and endowment insurance policies respectively.

Similarly, 54 and 37 women policy holders from unorganized category have

taken money-back and endowment insurance policies respectively.

Health policies offering health insurance coverage and annuity policies

help us to run peaceful post retirement life with stable incomes and Unit Linked

Insurance Policies (ULIPs) help us to enjoy the fruits of bullish trend in capital

markets. But all these three policies failed to attract women policy holders. Only

12 Health Insurance policies and only 5 policies in each of ULIP and Annuity

policy types have taken by the women in organised category. But in case of

unorganised category women policy holder’s only one policy is taken in each of

these three policies. The reasons for this lower penetration of these policies is

may be the absence of awareness on the part of the public and the lack of

effective advertisements by the insurers.

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Test of Significance: The data in table 4.10 reveals that the women policy

holders both in organised and unorganized sector prefer money back policies to

other form of policies. To verify this inference Kolmogorov- Smirnov test (K-S

test) was employed. The difference between the observed relative frequency and

expected relative frequency (K-S test result) for the preference of organized

sector women policy holders regarding money back policy is 0.15 which is high

when compared to other form of policies. Similarly, the difference between the

observed relative frequency and the expected relative frequency (K-S test result)

for the preference of unorganized sector women policy holders regarding money

back policy is 0.214 which is more than the other form of policies. But both the

values are less than the table value 0.486 for ν = 7, at 5 per cent level of

significance. Therefore it is concluded that the women policy holders both

organized and unorganized sector prefer all types of policies.

Table 4.11 Sum Assured of the Women Policy Holders

Sum Assured (in Rs.) Category I Category III Total Percentage

Below 1,00,000 23 80 103 51.5

1,00,001 – 2,00,000 18 16 34 17

2,00,001 – 3,00,000 19 4 23 11.5

3,00,001 – 4,00,000 16 0 16 8

Above 4,00,000 24 0 24 14

Total 100 100 200 100


The table showing the sum assured of the women policy holders reveals

that fifty-one per cent of the women policy holders in the sample selected are

insured for below Rs.1,00,001, fourteen per cent of the women policy holders in

the sample selected are insured for above Rs.4,00,000. While just 23 per cent

of the women policy holders from organized category insured their lives for

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below Rs.1, 00,001, eighty per cent of the women policy holders from

unorganized category are in this insured group. Similarly, while 40 per cent of

the families of the women policy holders from organized category are insured for

Rs.4,00,000 none of the women policy holders from unorganized sector are in

this insured group.

One of the reasons for these phenomena may be the lower amount of

earning among women in unorganized category. Another may be, even if they

are willing to opt for higher sum insured coverage, the same might have got

rejected on the grounds of moral hazard. But it is not so in the case of women in

organized category since they are treated on par with men and are insured for any

amount.

Table 4.12 Annual Premium Amount paid by the Women policy holders

Annual

Premium(in Rs.)


Below 2000 0 67 67 33.5

2001 – 4,000 30 20 50 25

4,001 – 6,000 21 12 33 16.5

Above 6,000 49 01 50 25

Total 100 100 200 100


The table shows the annual premium amount paid by the women in both

organized and unorganized category. The annual premium amount of above

Rs.6000 was paid by 49 women policy-holders from organized category whereas

in unorganized category, only one respondent paid the premium of that amount.

Most of the women policy holders in unorganized category pay below Rs.2000 as

their annual premium amount. In other words they are affordable to pay only

below Rs.166 per month, due to their comparatively lesser earning.

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Test of Significance: Table 4.12 reveals that annual premium amount paid

by the women in the organized category is higher than the amount paid by the

women in unorgansied category. To verify the data, normal distribution test (Z-

test) was used. The Z value is 15.069 which is more than 1.96 at 5 per cent level of

significance. Normal distribution test confirms the first hypothesis i.e., the

premium amount paid is higher in case of insured women in the organized

category than those in unorganized category.

Table 4.13 Correlation of Monthly Income and Sum Assured

Sum Assured

(in Rs.)

Monthly

Income

(in Rs.)

Below

5000

5000 -

10000

Above

10000

Total

Below 1,00,000 68 33 2 103

1,00,001 – 2,00,000 6 20 8 34

2,00,001 – 3,00,000 - 4 19 23

3,00,001 – 4,00,000 - - 16 16

Above 4,00,000 - - 24 24

Total 74 57 69 200


To find out the degree of relationship between the individual monthly

income of the women policy holders and sum assured by them Karl Pearson’s

co-efficient was calculated. The co-efficient (r) was found to be 0.8. This

indicates the existence of a high degree of positive correlation between these

two variables.

Test of Significance: To test the significance of r, student t- test was

employed. The calculated t-value of 18.76 was found to be more than the table

value of 1.96 at 5 per cent level of significance. It is therefore concluded that

there is a significant relationship between individual monthly income of the

women policy holders and sum assured by them.

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Table 4.14 Correlation of Family Income and Sum Assured

SumAssure

d (in Rs.)

FamilyIncome

(in Rs.)

Below

5000

5000 -

10000

Above

10000

Total

Below 1,00,000 2 73 28 103

1,00,001 – 2,00,000 - 8 26 34

2,00,001 – 3,00,000 - - 23 23

3,00,001 – 4,00,000 - - 16 16

Above 4,00,000 - - 24 24

Total 2 81 117 200


To find out the degree of relationship between the family income of the

women policy holders and sum assured by them, Karl Pearson’s co-efficient was

calculated. The co- efficient (r) was found to be 0.6. This signifies the existence

of a high degree of positive correlation between the two variables.

Test of Significance: To test the significance of r, student t test was

employed. The calculated t- value of 10.55 was found to be more than the table

value of 1.96 at 5 per cent level of significance. It is, therefore, concluded that

there is a significant relationship between family income of the women policy

holders and sum assured by them.

Table 4.15 Correlation of Educational Level and Sum Assured

Educational level School

Education

Gradu

ation

Post

Graduation

Technical

Education

Total

Sum assured(inRs.)

Below 1,00,000 66 24 8 5 103

1,00,001-2,00,000 10 13 10 1 34

2,00,001 – 3,00,000 1 - 15 7 23

3,00,001 – 4,00,000 - - 9 7 16

Above 4,00,000 - - 7 17 24

Total 77 37 49 37 200


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To find out the degree of relationship between the educational level of

women policy holders and the sum assured by them Karl Pearson’s co-

efficient was calculated. The co-efficient was found to be 0.735. This signifies

the existence of a high degree of positive correlation between the two

variables.

Test of Significance: To test the significance of r, student t- test was

employed. The calculated t- value of 15.25 was found to be more than the table

value of 1.96 at 5 per cent level of significance. It is therefore concluded that

there is a significant relationship between qualification of the respondents and

the sum assured by them.

This inferences from the above three tables confirm the fact that

demand for life insurance is positively related with the level of income and

education. Therefore, the second hypothesis i.e., demand for life insurance is

positively related with the level of Income and education, is proved.

Table 4.16 Mode of Payment of Premium Preferred by the Women Policy

Holders

Particulars Category I Category III Total Percentage

Single 06 0 06 3

Yearly 26 7 33 16.5

Half-Yearly 18 7 25 12.5

Quarterly 26 77 103 51.5

Monthly 53 9 62 31


LIC of India allows a rebate of 3per cent and 1.5 per cent for yearly and

half-yearly mode of payment of premium respectively in comparison with

quarterly mode of premium. For monthly mode of payment, 5per cent extra

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amount is charged to premium. However, in respect of Salary Saving Scheme

(SSS) mode of payment, no extra amount is charged. From the table it is clear

that, 103 women policy holders in both the categories preferred to pay their

premium on quarterly basis. Single payment mode is almost unpopular among

women policy holders. Only six respondents of organized category and no one

from unorganized category follow this mode. Monthly mode is preferred by 53

women belonging to organized category whereas only 9 respondents from

unorganized category preferred this mode. The advantages attached with SSS

mode, may be the reason for organized women preferring the monthly mode

more.

Table.4. 17 Women Policy Holders’ Preference of the Channel of Payment of

Premium

Payment Mode Category I Category III Total Percentage

SSS 29 0 29 13.74

Direct Payment 19 34 53 25.12

Through Agent 62 67 129 61.14

Total 110 101 211 100


The SSS provides for payment of premiums by monthly deduction

from the salary of employees by the employers in terms of the scheme. Direct

payment means policyholders directly pay the premium to the officials in their

LIC branch office. Similarly the agents may render their service by collecting

and paying the premium amount on behalf of policyholder and returning the

receipts to them. From the table it is clear that 129 women policy holders prefer

to pay the premium through agents, constituting a majority of 61.14per cent of

composite total. While 67 women policy holders from unorganized category

prefer to pay the premium directly as the second and only other option, and 29

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women policy holders from organised category prefer the SSS mode. As some of

the women policy holders prefer paying through more than one mode, the

composite total exceeds 200.

Table 4.18 Perception about the Sufficiency of Sum Assured

Perception Category I Category III Total Percentage

More than sufficient 6 3 9 4.5

Sufficient 53 79 132 66

Insufficient 41 18 59 29.5

Total 100 100 200 100


The table shows that 66 per cent of the women policy holders perceive

that the sum assured for their life are sufficient enough presently, 4.5 per cent

women policy holders perceive that the assurance sum is more than sufficient

and the rest 19.5 per cent feel that the sum assured is insufficient. Of the women

in organized category 41 per cent feel that the sum assured is insufficient

whereas only 18 per cent of the women in unorganized category feel so. This

may be due to the fact that the women in organized category perceive their life

much more valuable than the present sum assured whereas majority of the

women policyholders in unorganized category feel so contended with the present

sum assured.

Table 4.19 Readiness to take Another Policy in Future

State Category I Category III Total Percentage

Immediately 3 2 5 2.5

After some time 25 61 86 43

Not yet decided 34 22 56 28

Never 38 15 53 26.5

Total 100 100 200 100


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The table depicts that 43 per cent women policy holders are interested to

take another policy after some time, 2.5 per cent are planning to take another

policy immediately, and 28 per cent have not yet decided to take so in near

future. Only 26.5 per cent women feel that they will never take another life

insurance policy in future. On the other hand, as found in previous table, 70.5

women felt that the sum assured is sufficient enough. This contradiction is

glaringly evident among the women in unorganized category. Though 82 per cent

perceive that the sum assured is sufficient, only 15 per cent feel that they won’t

take another policy. This may be due to the fact that the sufficiency of sum

assured is in context with their present pay structure and they may seek high

assurance if there is any pay hikes and if they find more secured jobs. This table

also throws light on the fact that the potential for up-selling the products is high

among the insured women segment, since 45.5 per cent feel that they would take

another policy immediately or after some time.

Table 4.20 Criteria Adopted While Selecting An Agent

Criteria adopted Category I Category III Total Percentage

Friends and Relative 47 56 103 51.5

Advisor 42 36 78 39

Giver of Gifts or rebate 9 8 17 8.5

Use of Official pressure 2 0 2 1

Total 100 100 200 100


The above table shows the criteria, the women policy holders looked at, at

the time of selecting their agent. Of the total 200 women policyholders surveyed

a majority of the respondents i.e., 103 chose the Agent just because of the fact

that they are their friends or relatives or the references of their friends or

relatives. Secondly, 78 chose their agent, they being a good advisor and highly

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knowledgeable in the field, expressing the interest in the welfare of policy

holders.

Only two women policy holders from organised category accepted the fact

that they chose the agent only because of the higher official’s pressure on them.

From the table it is clear that the friends and relatives circle plays a vital role in

selecting an agent in the case of women policy holders which is followed by the

salesmanship of agent. Though 8.5 per cent of the respondents accept that the

rebate offering is the only main criteria to select the agents, a rebate in the form

of payment of first two or three premiums are expected by almost all the

prospects and the same is offered invariably by all the agents.

Test of Significance: From the above table, it is inferred that the majority

of the women policy holders select the agent upon the suggestions of friends and

relatives. To verify the statement chi-square test was used. The calculated value

of χ 2 = 34.93, which is more than the table value (ν =3, χ

20.05=7.81). Therefore,

the third hypothesis i.e., the women policy holders select the agent upon the

suggestions of friends and relatives than other criteria is confirmed.

Table 4.21 Frequency of Agent Meeting with the Women Policy Holders

Frequency of Meeting Category I Category III Total Percentage

At least 2- 3 times in a year 19 20 39 19.5

Meets every month 18 11 29 14.5

Meets whenever help sought 47 24 71 35.5

Whenever fail to pay

premium 11 44 55

27.5

Never meets at all 3 1 4 2

Whenever new policies are

launched 2 0 2

1

Total 100 100 200 100


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The table depicts the frequency of meetings the agent hold with the

women policy holders. Around 35.5 per cent women policyholders agree that

their agents meet them whenever the help is sought, 27.5 per cent meetings occur

immediately after failure in payment of premium and the one per cent meeting

take place only when new policies are launched.

The agents meet women policyholders every month in 14.5 per cent cases

and at least two or three times in a year in 19.5 per cent cases. In 2 per cent cases,

the agent never meets the policy holders at all. A majority of the respondents i.e.,

47 per cent women policy holders in organized category agree that the agents

meet them whenever the help is sought which may be because of the fact that the

present premium payments or future likely business for them is high in this

sector.

Similarly, a high 44 per cent women policy holders those who were in

unorganized category agrees that the agents meet them only when they fail to pay

premiums which may be because of the fact that lapse rate is comparatively

higher in unorganized category and needs to be reduced. Further the lapse may

cause a loss of commission also to the agents.

Table 4.22 Role of Agent in Enlightening about New Policies


Always 19 6 25 12.5

Whenever Approached 55 76 131 66

Never 26 17 43 21.5

Total 100 100 200 100


The LIC issues new policies every year and withdraw the existing in

some cases. The table found above expresses the experiences of women policy

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holders in getting enlightened about new policies by their agents. While 12.5 per

cent of the respondents are briefed about the new policies always, 66 per cent are

informed about the same whenever they approach their agents. But 21.5 per cent

of the respondents are kept in dark and are unaware about the features of the new

ones.

Interestingly, alleging the agents for not enlightening about the features of

the new policy is more among women respondents from organized sector. i.e. 26

per cent. This may be because of the fact that the agents’ presuming that the

women policyholders from the organized category need not be briefed about the

newer policies as their expected awareness level is high, in general.

Table 4.23 Perception on Agent’s Role in Assisting While Selecting the Policy


Not at all important 5 6 11 5.5

Least important 13 18 31 15.5

Moderately

important 43 28 71 35.5

More important 27 34 61 30.5

Extremely important 12 14 26 13

Total 100 100 200 100


According to the code of conduct specified in IRDA Licensing of

Insurance Agents Regulation, 2000, every insurance agent shall disseminate the

requisite information in respect of insurance products offered for sale by his

insurer and take into account the needs of the prospect while recommending a

specific insurance plan. The above table indicates that only 21 per cent of the

respondents perceive that the agent’s role in assisting to choose the right policy is

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least important or not at all important, 35.5 per cent perceive it as moderately

important and 43.5per cent perceive it as more important or extremely important.

Table 4.24 Satisfaction on Agent’s Role in Assisting While Selecting the

Policy

Satisfaction Category I Category III Total Percentage

Not at all satisfied 2 19 21 10.5

Less satisfied 13 9 22 11

Satisfied 52 47 99 49.5

Satisfied to some extent 33 24 57 28.5

Highly satisfied 0 1 1 0.5

Total 100 100 200 100


The table found above shows the fact that 10.5 per cent of the

respondents feel that they are not at all satisfied, and 11 per cent feels less

satisfied with the agent’s role in assisting them while selecting the policy.

Nearly half of the respondents feel satisfied and around 29 per cent feel satisfied

to some extent or highly satisfied with the agent’s role in assisting them to

choose the right policy.

Table 4.25 Perception on Agent’s Role in Prompt Delivery of the Documents


Not at all important 4 18 22 11

Least important 17 13 30 15

Moderately important 47 12 59 29.5



Total 100 100 200 100


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Though it is not the duty of the agent to deliver the policy documents to

the proposer, he is expected to verify the same and to inform promptly the

prospect about the acceptance or rejection of the proposal by the insurer code of

conduct 8 (1) (i)(h) of IRDA 2004. Since the documents are prepared and

delivered only on filing the prepared proposal forms, personal statements,

Agent’s confidential report form and Moral Hazard Report generally by agents, it

is considered as an important and evident outcome of all his actions hitherto

effected by him.

The above table shows that the only 11 per cent of the respondents

perceive the document delivery is not at all important and another 15 per cent as

least important. A whopping 31.5 per cent of respondents feel that the agent’s

role in prompt delivery of the documents as more important, 29.5 per cent as

moderately important and 13 per cent as extremely important.

Table 4.26 Satisfaction on Agent’s Role in Delivering the Policy Documents


Not at all satisfied 1 3 4 2

Less satisfied 16 13 29 14.5

Satisfied 58 43 101 50.5

Satisfied to some extent 23 31 54 27

Highly satisfied 2 10 12 6

Total 100 100 200 100


The above table reveals that 16.5 per cent of women policy holders are not

at all satisfied or less satisfied with the agent’s role in assisting while delivering

the policy documents. This is because of the fact that the customers perceive that

the agents are not speeding up the procedures for the prompt delivery of the

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documents. On the other hand, 83.5 per cent women policy holders are more

satisfied with their agent’s role on this aspect.

According to the IRDA (Licensing of Insurance Agents) Regulation,

2000, every insurance agent shall, with a view to conserve the insurance business

already procured through him, make every attempt to ensure remittance of the

premiums by the policy holders within the stipulated time, by giving notice to the

policy holder orally and in writing. The function of agents as laid down in Rule 8

of the LIC (Agents) Rules 1972 also stressed that every agent shall endeavor to

ensure that every installment of premium is remitted by the policy holders to the

Corporation within the period of grace and shall endeavor to prevent the lapsing

of a policy.

Table 4.27 Perception on Agent’s Role in Ensuring Regular Payment of

Premium





More important 34 46 80 40


Total 100 100 200 100


The table found above indicated that the women policy holders perceive

this agents role in ensuring regular payment of premium gain considerable

importance, since 40 per cent of the respondents perceive it more important,

30.5 per cent as moderately important and 11 per cent as extremely important .

Of the 200 respondents, only 37 i.e., 18.5 per cent perceive it as not at all

146

important or least important. Thus, women policy holders feel that though they

are the ultimate payers of premiums, they expect their agents to remind them and

help them for the payment of the same.

Table 4.28 Satisfaction on Agent’s Role in Assisting Payment of

Premium




Satisfied 47 50 97 48.5



Total 100 100 200 100


Of the 200 respondents, 69 per cent feel satisfied in various degrees with

the agent’s role in assisting payment of premium. But, 24.5 per cent are less

satisfied and 6.5 per cent are not at all satisfied with this agent’s role. LIC does

not authorize its agents to collect premium except first premium along with the

proposal or other amount from policy holders.

But if the agent collects such amounts remits to the insurer, gets receipts

to be handed over back to the policy holder, implied authority can be inferred.

Though the policy holders are made available to pay periodical premiums

directly through the electronic medium or through automatic transfers from their

bank accounts women policy holders still expect their agents to assume this

implied authority.

147

Table 4.29 Perception on Agent’s Role in Rendering Services While Policy is

in Force






Extremely important 14 15 29 14.5

Total 100 100 200 100


Life insurance salesmen, unlike other salesmen receive renewal

commission on their past business. Renewal commission is not a gift for service

already rendered. Old policies need to be serviced year to year and renewal

commission is paid for continued service the life insurance salesman is expected

to render to the policy holder. The services may be on various matters like

advising for appointment of nominee, alterations in the policy contract arranging

for policy loans, conservation of policies, revival of lapsed policies and

additional insurance.

The table found above explains how the women policy holders perceive

the agents role in rendering the after sales service. Only 2 of the 200 respondents

perceive this as not at all important and 25 others as, least important. Around

86.5 per cent perceived this role as is inevitable, 77 respondents perceiving it as

more important, 67 as moderately important and 29 others as extremely

important. Thus, this table clearly indicates that for all after sales services the

women policy holders mainly depend on the agents.

148

Table 4.30 The Satisfaction Level on Agent’s Role in Rendering Services While

Policy is in force

Satisfaction of Agent’s

Role




Satisfied 55 35 90 45



Total 100 100 200 100


The growth of insurance business to a large extent is dependent on the

skills and the ability of the well trained agents who offer better services. By

performing their duties, the agents render their valuable services not only to the

policyholder but also to the insurance company, government and the society they

belong. The table reveals that 45 per cent of women policy holders are satisfied

and 18 per cent are satisfied to some extent with agent’s role in rendering

services while policy is in force. Only five per cent women policy holders are not

at all satisfied with this role. This may be due to the fact that their expectations

are unheard and not understood by the agents properly.

Table 4.31 Perception on Agent’s Role in Frequency of Meeting the Customers







Total 100 100 200 100


149

As stated in the IRDA (Protection of Policyholders’ Interest) Regulations

2002, an agent’s responsibilities to the policy holders are not over with the

closing of the sale. It is essential that the sale is followed up with good after-sales

service and regular contact with the policy holders. To render after-sales

services, to ensure regular payment of premiums and to inform about new

products, the agents are expected to keep in touch with their customers.

The above table shows that nearly half of the respondents perceive that

the agent’s role in holding periodical meeting with the customers is moderately

important and 18 per cent perceive it as more or extremely important. Nearly

33.5 per cent of the respondents perceive the need for meeting is least important

or not at all important.

Table 4.32 Satisfaction on Frequency of Agent’s Meeting with the Policy

Holders





Satisfied to Some extent 15 18 33 16.5


Total 100 100 200 100


The above table reveals that 39 per cent of women policy holders

feel satisfied in holding periodical meeting. Further, 16.5 per cent and 4.5 per

cent of the respondents register their satisfaction with this role as satisfied to

some extent and highly satisfied respectively. On the other hand, 40 per cent of

the women policy holders are not at all satisfied or less satisfied. The reason for

the dissatisfaction may be because of their perception that their agents are mainly

150

at attracting new business rather than meeting and servicing the already existing

customer base.

Table No 4.33 Perception on Agent’s Role in Assisting to Avail Policy Loans







Total 100 100 200 100


Generally, the policy loans are given for 90 per cent of the surrender value,

calculated on the date of the loan, at the interest rate which is based on prevailing

bank rate. Loans can be repaid anytime or can be deducted from the claim with

interest. The above table shows that 97 respondents perceive the agent’s role in

assisting to avail policy linked loans as moderately important, 31 respondents

perceiving it as more important and 17 others perceiving it as extremely important.

Only 27 respondents perceive this role of agent as least important and 28 others as

not at all important.

Table 4.34 Satisfaction on Agent’s Role in Getting Policy Linked Loans







Total 100 100 200 100


151

Though all the 200 women policy holders have not availed the

policy linked loan because of their ineligibility or not preferring the same. But

from their past experience and exposures 4.5 per cent of the respondents feel

that they are not at all satisfied with their agents performance in assisting to get

the policy linked loans: and 21 per cent of women policy holders are less

satisfied . On the other hand, 43 per cent of the respondents are satisfied and 31.5

per cent are more than satisfied or highly satisfied with their agent’s assistance in

getting the policy linked loans. The high level of satisfaction may be due to the

fact that agents are well trained and are possessing sound knowledge with the

help of which they guide their customers while observing the loan procedures.

Table 4.35 Perception on Agent’s Role in Representing Grievances




Moderately important 40 62 102 51

More important 31 19 50 25


Total 100 100 200 100


As per IRDA (Protection of policy holders’ interest) Regulations 2002, an

insurer carrying life business should respond within 10 days of the receipt of any

communication from the policy holders on all the policy matters such as change

of address, nomination, assignment, issuance of duplicate policy, etc.

Though it is the responsibility of the LIC to redress a grievance, the agents

are expected to channelise the same to the corporation. The above table clearly

shows that only 4 per cent of the respondents perceive the role of agents in

representing various grievances to LIC as least important or not at all important

152

one. Of the total 200, 102 respondents perceive this role as moderately important,

50 other respondents perceiving it as more important and the rest 40 respondents

perceiving it as extremely important.

The fairness and efficiency of any institution is judged by the speed with

which it responds to grievances. Insurers ought to ensure that their complaints

redressal system is visible, so that customers can come to know where and how

to complain. The insurer should also ensure that their customer is allowed to

complain with ease at any point in the process. In India, the IRDA set up a cell

for settling the grievances of policy holders. The policy holder may approach the

cell for settling their complaints including claims.

Table 4.36 Satisfaction on Agent’s Role in Redressal of Grievances





Satisfied to some ext. 18 37 55 27.5


Total 100 100 200 100


The agents’ role in grievance redressal is felt satisfactory by 42 per cent of

women policy holders and further, 29.5 per cent women policy holders are more

and highly satisfied on this aspect. But 28.5 per cent of respondents are not at all

satisfied or less satisfied regarding agents performance in grievance redressal.

153

Table 4.37 Perception on Agent’s Role in Informing New Products and its

Benefits







Total 100 100 200 100


Apart from selling the right policy and the policy rights, the agents are

expected to inculcate the habit of saving, ensuring the regular payment of

premium and informing about the features and benefits of the new policies

introduced now and then, so as to extract the untapped potential. The above table

expresses the interest shown by the women policy holders in knowing the

features and benefits of new policies through agents. Out of the total 200

respondents, 73 considered it as moderately important and 50 as least important

and 21 others as not at all important. On the other hand, 33 respondents perceive

the agents’ role in informing the new products, features and benefits as more

important and 23 others perceive it as extremely important.

Table 4.38 Satisfaction on Agent’s Role in Informing New Products







Total 100 100 200 100


154

The success of the LIC rests on the time-honoured development of

product. An organization cannot survive if it fails in planning and developing its

products in tune with changing socio- economic environment. In the field of

insurance, product is the stage on which the entire drama of successful marketing

is enacted.

The above found table exhibits the satisfaction level of women policy

holders on their agent’s role in informing the new policies. It shows that 26.5

per cent of women policy holders are less satisfied and 5.5 per cent of the

respondents are not at all satisfied. Exactly half of the women policy holders

surveyed, are found satisfied and 18 per cent more of women policy holders feel

that they are satisfied to some extent or highly satisfied with their agent’s role in

informing the advantages of new life insurance products.

Table 4.39 Perception on Agent’s Role in Ensuring Timely Claim Settlements




Moderately important 36 16 52 26



Total 100 100 200 100


Claims payable at the end of the term are known as maturity claim. In

order to speed up the settlement of maturity claim, the insurer sends a discharge

voucher in advance to the assured. The requirements for claims are proof of age,

assignment deed, and the discharge voucher. LIC constituted Claims Review

Committee (CRC) at all the zonal offices and at the central office for considering

appeals against repudiation of claims by divisional offices. The divisional offices

155

while repudiating liability of the claimant also inform that if she is not satisfied

with the decision, then she can approach the claims review committee.

According to the code of conduct specified in IRDA (Licensing of

Insurance Agents Regulation, 2000) as well as the function of agents as laid

down in Rule 8 of the LIC Agents (Rules 1972), stipulated that every agent shall

render all reasonable assistance to the policy holders or claimants or beneficiaries

in filling claim forms and in complying with the requirements laid down in

relation to settlement of claims.

The above table shows the perception of women policy holders on the role

of agent in ensuring timely claim settlement. Only 2.5 per cent women policy

holders perceive this role as not at all important or least important. Of the total

respondents, 42.5 per cent perceive the agent’s role in ensuring the timely

settlements is moderately important and more important, a high 55 per cent

perceive it as extremely important one.

Table 4.40 Satisfaction on Agent’s Role in Assisting While Making the Claims




Satisfied 50 59 109 54.5



Total 100 100 200 100


Claims settlement is the key success factor of any insurer as the prompt

and timely settlement of claims help in enhancing the confidence of policy

holders in insurance companies. Though the respondents have no personal

156

experiences for claims for the policies that they are presently in possession of,

from their past experience and exposure, they ranked their satisfaction level for

the agents’ role in assisting at the time of claims settlement.Only 4 per cent and

25 per cent of the respondents express that they are not at all satisfied and less

satisfied when the agent’s role in assisting the claims respectively. But 71 per

cent of the respondents register their satisfaction in various degrees with this role

of agents. In the below found table, the perceptions of women policy holders of

organized category, on agents’ various role are analysed.

Table4.41 Summary of Perception of Organized Women Policy Holders on

Agents’ Role.

Role N.I

-2

L.I

-1

I

0

M.I

1

E.I.

2

χ 2 w.m

Assisting in selecting the

needed policy

5 13 43 27 12 45.8 28.0

Delivering the documents

promptly

4 17 47 18 14 51.7 21.0

Ensuring regular payment of

premium

3 10 42 34 11 57.5 40.0

Rendering services while

policy is in force

1 11 46 28 14 60.9 43.0

Meeting customers at regular

intervals

7 24 45 16 8 48.5 -6.0

Assist to avail policy loans 14 15 48 18 14 44.25 3.0

Representing the grievances 1 4 40 31 24 57.7 73.0

Informing new products and

benefits

10 19 45 17 9 46.8 -4.0

Ensuring timely claim

settlements

1 1 36 18 44 77.9 103.0

N.I -Not Important, L.I - Less Important, I- Important,

M.I - More Important, E.I - Extremely Important w.m – weighted mean


157

Table value of chi-square for ν = 4, χ 2 0.05 is 9.49. The calculated χ

2

values are more than the table value. This reveals that the perception of

organized sector women policy holders on agent’s role is significant. However,

the weighted mean values of role in frequency of meeting the customers and role

in informing new products and its benefits are negative. This implies that the

attributes are having less significance regarding the perception of organized

sector women policy holders on agent’s role. The weighted mean value for the

role of agents in ensuring timely claim settlements is very high i.e., 103.0.

Table 4.42 Summary of Perception of Women Policy Holders of Unorganized

Category on Agents’ Role.

Role N.I -

2

L.I

-1

I

0

M.I

1

E.I.

2

χ 2 w.m


needed policy

6 18 28 34 14 24.8 32.0


promptly

18 13 12 45 12 40.3 20.0

Ensuring regular

payment of premium

11 13 19 46 11 44.4 33.0

Rendering services while

policy is in force

1 14 21 49 15 63.2 63.0

Meeting customers at

regular intervals

11 25 52 7 5 76.2 -30.0

Assist to avail policy

loans

14 12 49 13 12 52.7 -3.0

Representing the

grievances

1 2 62 19 16 123.3 47.0

Informing new products

and benefits

11 31 28 16 14 15.9 -9.0


settlements

2 1 16 14 66 142.1 142.0

N.I -Not Important, L.I - Less Important, I- Important, M.I - More Important, E.I

- Extremely Important w.m – weighted mean


158


2

values are more than the table value. This denotes the perception of unorganized

category women policy holders on agent’s role is significant. However, the

weighted mean values of role in frequency of meeting the customers, role in

assisting to avail policy loans and role in informing new products and its benefits

are negative. These attributes are having less significance when comparing other

attributes. The role in ensuring timely claim settlement is more significant when

compared to all other roles.

Table4.43 Summary of Satisfaction Level of Women Policy Holders of

Organised category On Agent’s Role

Role N.S

-2

L.S

-1

S

0

S.S

1

H.S

2

χ 2 w.m


needed policy

2 13 52 33 0 98.3 0.16


promptly

1 16 58 23 2 107.7 0.09

Ensuring regular payment of

premium

1 33 47 18 1 81.2 -0.15

Rendering services while policy

is in force

1 19 55 21 4 92.2 0.08

Meeting customers at regular

intervals

4 32 46 15 3 69.5 -0.19

Assist to avail policy loans 1 26 53 18 2 90.7 -0.06

Representing the grievances 3 24 54 18 1 91.3 -0.10

Informing new products and

benefits

5 35 42 15 3 62.4 -0.24


settlements

4 28 50 18 0 81.2 -0.18

N.S -Not Satisfied, L.S - Less Satisfied, S- Satisfied, S.S – Satisfied to Some

extent, H.S –Highly Satisfied, w.m – weighted mean


159


2

values are more than the table value. This indicates that the satisfaction level of

the organized sector women policy holders on agent’s role is significant.

Anyhow the weighted mean values regarding payment of premium, frequency of

agent meeting, getting policy linked loans, role in redressal of grievances, role in

informing new products, and role in assisting while making the claims are

negative values which reveal that the satisfaction level of the policy holders are

somewhat less.

Table4.44 Summary of Satisfaction Level of Women Policy Holders in

Unorganised Category on Agent’s Role

Role N.S

-2

L.S

-1

S

0

S.S

1

H.S

2

χ 2 w.m

Assisting in selecting

the needed policy

19 9 47 24 1 61.4 -21.0

Delivering the

documents promptly

3 13 43 31 10 54.4 32.0

Ensuring regular

payment of premium

12 16 50 14 8 58.0 -10.0

Rendering services

while policy is in force

9 35 35 15 6 39.6 -26.0

Meeting customers at

regular intervals

25 19 32 18 6 18.5 -39.0

Assist to avail policy

loans

8 16 33 19 24 17.3 35.0

Representing the

grievances

8 22 30 37 3 41.3 5.0

Informing new

products and benefits

6 18 58 12 6 95.2 -6.0


settlements

4 22 59 8 7 104.7 -8.0

N.S -Not Satisfied, L.S - Less Satisfied, S- Satisfied, S.S – Satisfied to Some

extent, H.S –Highly Satisfied, w.m – weighted mean


160

Table value of chi-square for ν =4, χ 2 0.05 is 9.49. The calculated χ

2

values are more than the table value. This indicates that the satisfaction level of

the unorgansied sector women policy holders on agent’s role is significant.

However, except the role in assisting while delivering the policy documents, role

in getting policy linked loans and the role in redressal of grievances, the all other

factors are having negative weighted mean values. It implies that the unorgansied

sector women policy holders’ satisfaction level upon the agent’s role is very low.

Table 4.45 Level of Dependence on Agent and LIC Office for Services

Level of Dependence Category I Category III Total Percentage

Completely on agent 22 51 73 36.5

Mostly on the agent and to

some extent on branch office 54 28 82 41

Mostly on branch office and

to some extent on agent 20 16 36 18

Completely on branch 4 5 9 4.5

Total 100 100 200 100


Organization structure of LIC has a four-tier structure comprising central

office, zonal offices, divisional offices, and branch offices. Branches considered

as profit and growth centre, like banking, the insurance business is also supported

greatly by wide network of branches. The central office is to perform the

activities relating to investments framing and administering the rules and laws of

LIC. Zonal and divisional offices are established on the basis of geographical

area. They are discharging the coordinating functions. Almost 90 per cent of the

functions relate to the policy holders are performed by the branch office. They

are now responsible for proper cash flow management at their level and transfer

161

of surplus to the divisional office. Out of the 445 districts in India, 401 districts

have LIC branches with their jurisdiction.

The above table 4.45 reveals the higher degree of dependence on agents.

While 36.5 per cent respondents accept that they depend completely on agents

for any services, 41 per cent accept that they also depend mostly on agents and

only to some extent depend on branch office. On the other hand, 4.5 per cent of

the respondents mainly depend on branch and 18 percent say that they depend on

agents only to some extent.

Test of Significance: To test the level of dependence of women policy

holders on agents or LIC office for services chi-square test was employed. The

chi-square calculated value is 20.32 which is more than the table value for ν =3,

χ 2 0.05 = 7.81. Therefore it is confirmed that the level of dependence of the

women policy holders is mainly based on agents rather than LIC office for

services.

Table 4.46 Knowledge of the Women Policy Holders on Various Features of

the Policy at the Time of Taking

Features Category I Category III Total Percentage

Premium rate 88 82 170 85

Bonus percentage 39 29 68 34

Loan facility 53 65 118 59

Maturity value 100 39 139 69.5

Accident benefit 52 78 130 65

Mode of payment 80 74 154 77.5


The above table shows whether the women policy holders were fully

aware of various features of their own policies at the time of taking the same. For

example, Accident benefit rider provides for payment of an additional benefit

162

equal to the sum assured in installment on permanent total disability and also

waiver of subsequent premiums payable under the policy. It also provides for

payment of an additional amount equal to the sum assured in case of death by

accident.

A whopping 85 per cent of women policy holders feel, that they were

completely aware of the premium details at the time of taking their policy, 34per

cent of them were having the knowledge about the bonus rate and 59per cent of

the insured women possessing a clear idea about the loan facility. Other aspects

like maturity value, accident benefit and mode of payment were understood by

the 69.5 per cent, 40 per cent and 77 per cent of the women policy holders

respectively at the time of purchase of policy itself. From the above, it is clearly

inferred that, women policy holders paid more attention on and were

comparatively knowledgeable about the premium rate and mode of payment

aspects than other life insurance policy related issues.

Test of Significance: To test the knowledge of the women policy holders

on various feature of the policy at the time of taking it. K-S test was employed.

The K-S test calculated value 0.066 is less than the table value of 0.521 at 5 per

cent level of significance. This indicates that the women policy holders have the

knowledge about the various features of the policy at the time of taking it.

Table 4.47 Opinion of the Women Policy Holders about the Premium Rates

Opinion Category I Category III Total Percentage

Too high 8 4 12 6

Moderate 72 71 143 71.5

Low 20 25 45 22.5

Total 100 100 200 100


163

A premium is normally fixed by the actuaries after considering morality

rate, administrative expenses and current and future likely interest rates. Rebates

may be allowed on the published rate of premium for high sum assured or lesser

frequency of premium. Extra premium may be charged for low sum assured or

higher frequency of premium. Extra premium may also be charged at the time of

underwriting depending on assessment of risk.

The opinion of women policy holders about the premium rate are

explained in the above table which characterizes the fact that 6 per cent of

insured women feel that the premium amount collected by the LIC was too high

and 71.5per cent of the policy holders opine it as moderate. Only 22.5 per cent of

the respondents considered the premium amount for their policy was low.

To verify the opinion of women policy holders about the premium rates

chi-square test was employed. The calculated, χ 2 value is 1.906 which is less

than the table value of 5.99 (for, ν =2, χ 2 0.05) It is therefore, concluded that there

is no significant difference between the opinion of the women policy holders

about the premium rates.

Table 4.48 Awareness about the Rate of Penal Interest

Awareness Category I Category III Total Percentage

Yes 36 40 76 38

No 64 60 124 62

Total 100 100 200 100


Being a long term contract, in life insurance it is possible that sometimes

policy holders may not pay the premiums in time. The premiums will be

accepted within days of grace, without any charge of interest or any penalty and

irrespective of health of the life assured. A grace period of one month is allowed

164

for payment of yearly, half yearly and quarterly period of mode. A grace period

of 15 days is allowed in the case of monthly mode of payment of premium.

If death takes place within the grace period and premium remains unpaid,

the claim amount is paid in full, subject to the deduction of unpaid premium in

the policy year. The policy will totally lapse if the policy premium is not paid

within the days of grace for the policy taken within 3 years. If it is after 3 years

the policy will acquire paid-up value or be eligible for the automatic advance of

premium as per the policy conditions. Within 6 months of the due date, policy

holders have the right to pay the premium just with the interest for the due period

without providing the proof of insurability. If the policy lapsed for more than six

months policy holder revive the policy with the proof of insurability usually a

health declaration along with interest for delayed payment. Lapsing policy is

always a loss to the company as well as to the policy holder. So the insurers offer

attractive revival schemes to the policy holders to revive the policy. The above

table clearly shows the status of awareness of women policy holders about the

rate of penal interest for lapsed policies and delayed payment. Among the

respondents, 38 per cent are aware and 62 per cent of the women policy holders

are unaware about the penal interest for lapsed policies and delayed payment. It

is inferred that irrespective of the category they belong to, the insured women

still remain unaware about this crucial thing.

Table No.4.49 Perception about the Penal Interest


High 1 4 5 6.6

Moderate 22 21 43 56.6

Low 13 15 28 36.8

Total 36 40 76 100


165

Though a majority of the women policy holders are unaware of the penal

interest rates for the delayed payment of premiums, opinions are sought from

those who are aware about the same. Of the 76 respondents who are aware of the

penal interest 43 opine that it is moderate, 28 as low and 5 others commenting

the interest rate as high.

Table 4.50 Attitude towards the Entry of Private Players

Attitudes Category I Category III Total Percentage

Favouring 73 46 119 59.5

Not favouring 27 54 81 40.5

Total 100 100 200 100


Towards liberalization and opening up of the insurance sector to private

players, the attitude of the women policy holders are analysed in this table. A

majority of 59.5 per cent of women policy holders in total favour the entry of

private players including 73 organised women and 46 unorganised women

employees. But 40 per cent of the respondents consisting of 27 organised women

policy holders and 54 unorganised women policy holders do not favour the entry

of private players. This is because of the perception that the private players are

always interested at shareholders’ benefit than the policy holders’ interest. So the

private player’s entry in social security measures like insurance might have not

been favoured by the majority of the respondents. To identify the attitude of the

women policy holders in favouring the entry of private players in insurance

industry chi-square test was employed.

Test of Significance: The calculated chi-square value is 15.12 which is

more than the table value for ν =1, χ 2 0.05 i.e., 3.84. It is therefore, concluded that

the women policy holders favour the entry of private players in insurance industry.

166

Table 4.51 Opinion about Taking Private Player Policies

Opinion Category I Category III Total Percentage

Willing 62 23 85 42.5

Unwilling 38 77 115 57.5

Total 100 100 200 100


India initiated liberalization in insurance sector with the objective of

providing better coverage to Indian citizens and augmenting the flow of

infrastructure of the nation. This has laid a great responsibility on this sector to

ensure a very fast growth enabling India reaching to the level of developed

countries of the world in the penetration of insurance.

The above table shows the willingness of women policyholders in taking

policies from private players. While 42.5per cent of the insured women are

willing to take policies from the private insurers, 57.5per cent of the respondents,

consisting of 38 women from organised category and 77 women from

unorganised category express their unwillingness to go for private life insurance

policies. This may be because of the fact that the private players failed to exert

confidence from the women policy holders of LIC towards them.

To assess the willingness of the women policy holders in taking policies

from private players in insurance industry chi-square test was employed. The

calculated chi-square value is 36.74 which is more than the table value for ν =1,

χ 2 0.05 i.e., 3.84. It is, therefore, concluded that the women policy holders are

not willing to take policies from private players in insurance industry. Hence, the

fourth hypothesis of the study, i.e., even though the women policy holders are

welcoming the private insurance companies, they are not willing to take policies

in the private companies, is proved.

167

Table 4.52 Perception about Attracting Feature for taking Policies from Private

Players in Insurance Industry

Features Category I Category III Total Percentage

Advertising 17 6 23 27

Lower Premium 4 1 5 6

Better Service 31 13 44 52

Brand Name Of Insurer 10 3 13 15

Total 62 23 85 100


It is believed that innovative products, smart marketing and aggregate

distribution have enabled fledging private insurance companies to sign up Indian

customers faster than any one expected. The above table explains the perception

of the women policy holders about attracting feature for taking policies from

private players in Insurance Industry. Of all the respondents, only 85 showed

their willingness to purchase life insurance products from private players.

Among these women, 44 registered their preference for private insurers for their

better services, 23 insured respondents prefer to take policies from private

players because of the effective advertisement they followed, 13 prefer private

players for the brand name of the insurer and only five respondents prefer

private players because of the lower premium charges.

Table 4.53 Perception about the Performance Improvement of LIC after the

Entry of Private Players


Totally agree 12 11 23 11.5

Agree to large extent 19 27 46 23

Agree to some extent 46 14 60 30

Totally disagree 7 2 9 4.5

Can’t say 16 46 62 31

Total 100 100 200 100


168

Liberalisation has provided greater autonomy to insurance companies in

order to improve their performance and enable them to act as independent

companies with economic motives. Opening up the sector to competition

compels the public sector to revamp its marketing strategy and as a result it

started showing the signs of improvement.

The table 4.53 lists the perception of the women policy holders whether

performance of LIC got improved after the entry of private players. Nearly one-

third of the insured women are not able to give any certain comment on this

aspect. Only meager 4.5 per cent of the women policy holders disagree with the

notion that LIC improved its performance after the entry of private players. On

the other hand, a whopping 64.5per cent of the respondents agree to some extent,

to large extent or to a complete level of agreement on this notion that LIC has

improved its performance after the entry of private insurers. This is because the

LIC even now consistently trying to brace itself with zeal to deal with the new

challenge posed by the new private companies.

Table 4.54 Opinion Regarding the Performance of LIC in comparison with

Private Players

Features LIC Percentage Private

Players

Percentage Total

Novel Policy Features 119 59.5 81 40.5 200

Ease of Forms 95 47.5 105 52.5 200

Effective Advertisement 81 40.5 119 59.5 200

Courteous Agents 112 56 88 44 200

Lower Premiums 138 69 62 31 200

Reliability 166 83 34 17 200

Claim Settlement 173 86.5 27 13.5 200

Grievance Redressal 127 63.5 73 36.5 200


169

The sweeping changes in the form of commoditization, globalization,

deregulation and the rapid technological advancements all over the world have

changed the market scenario for insurance services. With the help of customer

relationship marketing the private players is also selling multiple insurance

products and pension plans to the customer. The table compares the women

policy holders’ perception regarding the performance of LIC in comparison with

private players. While 59.5 per cent of women policy holders perceive LIC

possess novel policy features, the rest of the 40.5per cent respondents vote this

feature in favor of private players.

As far as ease of forms is concerned, the private players secure the higher

scores than LIC. Only 47.5per cent of insured women perceive LIC is observing

simplicity in the paper works. But 52.5per cent of them feel private players

outperform in this aspect. Ease of forms means application formalities followed

by the insurers while accepting new applicants to various insurance policies

which include procedures followed for proposal forms, moral hazard report,

medical examination report and confidential report of the agents.

In the area of advertising also, the private players are in a better position

by securing a share of 59.5 per cent towards them. The LIC was perceived by

only 40.5 per cent of the women policy holders as the better advertiser. As far as

the aspect of courteousness of agents is concerned, 56per cent of insured women

perceive that LIC agents are more courteous than the private insurers. On the

other hand, 44 per cent of the women policy holders perceive that agents of

private insurers are better than those of LIC.

Generally there is a opinion that enjoying the status of monopoly

for 44 years, the premium rates charged by the LIC are the highest amongst the

170

insurance companies in the world (Rajesham, 2006). But the women policy

holders surveyed view this aspect differently, .i.e., 69 per cent of the insured

women elects LIC as a better service provider charging lower premiums and

only 31 per cent of them perceive private insurers charge lower premiums.

But when reliability is taken as a measure to assess the performance

efficiency, with no reservation, a majority of 83 per cent of the women policy

holders perceives that LIC as the best one when comparing with the private

insurers and 17 per cent of the insured women perceive that private insurers are

more reliable ones.

As claim settlement is concerned, LIC once again gets a higher score of

86.5 per cent and only 13.5 per cent of the insured women perceive that the

private life insurance companies out perform LIC in claim settlements. On the

aspect of grievience redressal, 63.5per cent of the respondents rates LIC as better

grievance handler and 36.5per cent of the insured women perceive that private

players are efficient in handling grievances, than LIC.

To sum up, private players are preferred for ease of forms and effective

advertisement by the women policy holders, whereas LIC was perceived as

better performer in the aspects like novel policy features, courteous agents,

lower premiums, reliability, claims settlement and grievance redressal.

---------------------------------------------------------------------------------------------

Rajesham, Changing scenario of Indian Insurance Sector, Indian Journal of marketing

vol. XXXVI, July 2006 No.7.

171

Table No.4.55 Category wise analysis on the Perception of Women Policy

Holders regarding the Performance of LIC in Comparison with Private Players

Features Category I Category III Total

LIC Private LIC Private

Novel Policy Features 44 56 75 25 200

Ease of Forms 39 61 56 44 200

Effective Advertisements 22 78 59 41 200

Courteous Agents 55 45 57 43 200

Lower Premiums 63 37 75 25 200

Reliability 92 8 74 26 200

Claim Settlement 88 12 85 15 200

Grievance Redressal 47 53 80 20 200


The above table compares the perception of the respondents of organized

category with that of the unorganized category regarding the performance of LIC

in comparison with private players. The women from organized category vote

LIC for its reliability and claim settlement aspects as the most two attractive

features while comparing with private players. It is evident from the higher

scores of 92 per cent and 88 per cent respectively to these two criteria.

On the other hand they prefer private players for the effective

advertisement and ease of form for which their higher scores of 78 per cent and

61per cent are found respectively. The insured women from unorganized

category prefer LIC especially for its timely claim settlement and grievance

redressal which is evident from the significant score of a high 85 and 80

respectively. They prefer LIC over private players in all aspects.

172

Table 4.56 Frequency of Visiting LIC Branch Office

Frequency of

Visiting


Only Once 23 43 66 33

Regularly 4 27 31 15.5

Occasionally 63 23 86 43

Not So For 10 7 17 8.5

Total 100 100 200 100


The above found table shows the frequency of women policy holders

visiting the branch offices. One-third of the insured women surveyed , visited

only once and 58.5 per cent of the insured women made regular or occasional

visits to the branch office only 8.5 per cent of the women policy holders do not

make even a single visit to the branch office so far, which may be due to their

complete dependence on the agents.

Table 4.57 Distances between Places of the Women Policy Holders and the LIC

Branch Office

Distance in k.m Category I Category III Total Percentage

Below 10 18 49 67 33.5

10-20 18 43 61 30.5

20-30 28 1 29 14.5

More than 30 36 7 43 21.5

Total 100 100 200 100


The above table shows the distance between place of respondents and LIC

branch office. One-third of the insured women state that the distance between their

residence and branch office is less than 10 k.m. For 30.5 per cent of the

respondents a branch office is situated within a distance of 10-20 k.m., for 14.5 per

173

cent respondents it is within a distance of 20-30 k.m., and for 21.5 per cent of the

respondents are located even 30 k.m away from the branch office. The increased

distance between the locations of the customer to the branch office may limit the

accessibility of the insured women to the LIC branches and their services.

Table 4.58 Satisfaction on the Facilities at the Branch Office

Facilities Spacio

usness

Seat

- ing

water V venti-

llation

Illuminat-

ion

Interior queues sign

board

s

Not at all

satisfied 1 3 7 9 7 5 5 3

Less satisfied 13 30 19 38 42 39 31 33

Satisfied 121 124 125 112 110 120 115 129

Satisfied to

Some Extent 34 21 22 19 22 15 28 14

Highly

satisfied 14 5 10 5 2 4 4 4

Total 183 183 183 183 183 183 183 183


To assess the satisfaction of the customers towards the LIC branch it is

imperative to measure the satisfaction of facilities available at the branch office.

While facilities at the branch office are concerned, spaciousness, seating

arrangements, drinking water facility, ventilation, illumination, space for queues

sign boards and interior decoration are taken into account.

Regarding spaciousness of the branch office, of the 183 respondents who

visited the branches, 121 women policy holders feel satisfied; 34 feel satisfied to

considerable extent and 14 of the respondents feel highly satisfied. Only one

respondent feel not at all satisfied and 13 others feel less satisfied on this aspect,

174

Regarding the seating arrangement in the branch office, 124 respondents

feel satisfied, 21 others feel satisfied considerably and 5 of them feel highly

satisfied. But the respondents feel less or not at all satisfied with this aspect.

When the drinking water facility available at the office is reminded, 125 of the

respondents feel satisfied, 22 feel satisfied to a considerable extent and 10 others

feel highly satisfied. On the other hand, 26 respondents feel not satisfied with

this aspect.

As far as ventilation is concerned, 136 feel satisfied with various degrees

and 47 others are not satisfied. As far as, illumination is concerned, 134

respondents feel satisfied with various degrees and 49 of the sample selected are

not all satisfied or less satisfied. Similarly 139 of the respondents feel satisfied

with the interior decorations. Only 5 of them are not at all satisfied and 39 others

feel less satisfied with this aspect. Of the total respondents, 147 policy holders

feel satisfied with the space for queues and sign boards and 36 women

policyholders feel that they are not at all satisfied or less satisfied with the space

for queues and the arrangement of the sign board in the branch office.

Table 4.59 Women Policy Holders Availing Policy Loans from LIC

Policy Loans Category I Category III Total Percentage

Availed 30 71 101 50.5

Not availed 70 29 99 49.5

Total 100 100 200 100


From the above table, it is clear that 30 women policy holders in

organised category availed policy linked loans and majority of the policy

holders, say 70 of them were either ineligible for or uninterested in availing the

loan facility. A majority of the women policy holders in unorganised category

175

i.e., 71 per cent availed the policy linked loans and only 29 per cent have not

availed the same. This may be due to the fact that women in unorganized sector

need credit facility from LIC as it is difficult for them to access other forms of

organised financial sources.

Table 4.60 Reasons for Availing Policy Loans from the LIC

Reasons Category I Category III Total Percentage

Low rate of interest 6 58 64 63.3

Quick realization of loan 6 5 11 10.8

Convenient repayment of terms 5 3 8 7.9

No compulsion for Immediate

Repayment 6 2 8

7.9

No necessity for Collateral

security 2 3 5

4.9

All the above 5 0 5 4.9

Total 30 71 101 100


The above table makes clear that low rate of interest stood first while listing

the reasons for availing policy linked loans from the LIC. Of the 101 women

policy holders availing the policy linked loans, 64 women policy holders,

consisting of 58 women from unorganized category and six women from organised

category acknowledge the same fact.

As a second reason for availing policy loan, the quick realization of loan

was quoted by 11 women policy holders. Each of the two reasons namely, the

convenient repayment terms and no compulsion for immediate repayment attract 8

insured women to avail loans. Five insured women availed loans mainly because

of the fact that there is no necessity for arranging any collateral security for the

same. And five other respondents are unable to prioritize the reasons and state all

176

of the five reasons stated above attract them to avail policy loans. As 99

respondents have not availed any loans their opinions are not sought here.

Table 4.61 Prime Source of Information about the New Policies Introduced

Source of Information Category I Category III Total Percentage

Through advertisements 40 50 90 45

Through friends 33 16 49 24.5

Through agent 27 34 61 30.5

Total 100 100 200 100


New products invariably are meant to cater to the specific changing

customer needs and are designed by the insurer on the basis of feed back from the

market. The table shows that 45 per cent of the women policy holders came to

know about the new policies through advertisements only, which is followed by

the agents source constituting 30.5 per cent and for the rest 24.5 per cent the prime

source of information about the new policies are friends and others, who may be

other policy holders acting as media to carry the message of the insurer. But, as far

as the respondents from organized sector are concerned, the friends and relatives

are ahead of agents in passing information about the new policies.

Table 4.62 Receipt of the Premium Notices Regularly by Women Policy Holders

Receipt of

Premium Notices


Received 84 82 166 83

Not received 16 18 34 17

Total 100 100 200 100


The above table takes into account not only first premium receipt but also

all the receipts and reminders related with the premium amount. It reveals that 83

177

per cent of respondents receive the premium notices regularly from the life

insurance authorities and 17 per cent of insured women are not in receipt of the

premium notices properly. In other words, this 17 per cent segment may fail to

pay premium in time or may pay penal interest, failing of which may even lead to

lapse of policy. Though it is not obligatory, the LIC branches are ought to remind

the policy holders at least by sending SMS to the mobile phones of the

customers.

Table 4.63 Understandability of Policy Document by Women Policy Holders


Understandable 35 15 50 25

Not understandable 65 85 150 75

Total 100 100 200 100


Life insurance policies are contractual agreement enforceable in a court of

law. Insurance policies are long-term contract and are normally executed on trust

and utmost good faith. So, the documents should be essentially prudent and clear

without any ambiguity. If the proposer is illiterate, the left thumb impression has

to be attested by a third party who has to give a declaration that the questions

were explained to the proposer in vernacular language and answers received

were recorded truthfully and read out back to her and were understood by her.

The above table reveals the understandability of women policy holders

about the terms and conditions while reading the policy documents. Of the total

200 respondents, with no hesitation 75 per cent of the women policy holders

accept that the policy document is not understandable. Only 25 per cent state that

the language of the document is understandable. We cannot brush aside this fact

as the understandability of the policy document is just because of the poor

178

education level of the respondents from the unorganized category. Even 65 per

cent of the women from organised category who are comparatively literate feel

the same. So, steps are to be taken by LIC to give the policy document in plain

and vernacular language.

Table 4.64 Awareness of the Women Policy Holders about Health Insurance


Aware 80 48 128 64

Unaware 20 52 72 36

Total 100 100 200 100


Prior to the liberalization of insurance, LIC used to sell mainly life

insurance policies. After liberalization of insurance both public and private, life

and non life insurers are trying to capture the huge health insurance market

which is hitherto untapped. Most of the private insurers are coming up with new

health policies. So, an attempt is made to assess the awareness level among the

life insured women about health insurance.

From the above table, it is clear that 64 per cent of the respondents

consisting of 80 women of organised category and 48 women of unorganized

category are aware of the health insurance policy. On the other hand, 36 per cent

of the respondents consisting of 20 women in organised category and 52 women

in unorganized category are unaware of the health insurance policy. The very

low level of awareness among the women from unorganized category may be

due to the fact of their low level of education and exposure.

Though the health insurance is the fastest growing segment of the

insurance industry, the penetration of the health insurance products among

179

women is very low, which is clearly supported by the table showing the nature of

policies taken by the respondents. It shows that except a single woman in

unorganized category others do not have a health insurance policy. Without

much difference, 88 per cent of the respondents in organized category also, do

not have a health insurance policy.

Table4.65 Perception of the Women Policy Holders about Health Insurance

Policy


Highly useful 12 7 19 9.5

Useful to certain extent 41 25 66 33

Useful 26 25 51 25.5

No comments 21 43 64 32

Total 100 100 200 100

The above table analyses the perception of women policy holders about

health insurance policy. It is observed that one- third of the women policy holders

perceive that health insurance policy is useful to certain extent and in addition 9.5

per cent of others perceive it as highly useful. On the other hand, around one-

fourth of the respondents perceive health insurance as not at all useful. Around

one- third of others prefer not to give any comments about the usefulness of health

insurance policy.

Table 4.66 Annual Family Medical Expenses of the Women Policy Holders

Expenses amount in Rs. Category I Category III Total

Below 1000 27 90 117

1000-2000 22 4 26

2001-3000 21 2 23

Above 3000. 30 4 34

Total 100 100 200


180

Health needs of the people are increasing day by day and more so, the cost

of treatment is also escalating with the parallel pace. The table analyses the

annual family medical expenses of the women policy holders. From the sample

selected, 90 per cent of respondents from unorganized category spend less than

Rs. 1000 per annum and four per cent of them spend between 1000-2000 per

annum and two per cent spend between Rs 2001-3000 and 4 per cent spend more

than Rs.3000 per annum.. In case of women in organised category, 30 per cent

spend medical expenses more than Rs. 3000, 21per cent of them incur annual

medical expenses Rs.2000 to 3000 and 22 per cent spend Rs.1000 to Rs.2000

and only 27 per cent spend below Rs.1000 as medical expenses.

The annual family medical expenses incurred by the women policy

holders are unavoidable irrespective of their income level. Instead of spending

medical expenses, the fraction of the same may be utilized to get a health policy

cover for the entire family.

Table 4.67 Awareness of the Women Policy Holders about ULIP

Awareness Level Category I Category III Total Percentage

Fully aware 38 55 93 46.5

Partially aware 43 33 76 38

Unaware 19 12 31 15.5

Total 100 100 200 100


Unit linked products are sold both under the individual single premium

and non-single premium segments. There are two variants in unit linked plans. In

case of guaranteed - maturity and death amount- Unit-Linked Insurance Plans,

the policy holders get the market value of units or sum assured whichever is

higher. In case of guaranteed death amount only ULIP also, the policy holders

181

get the market value of units or sum assured whichever is higher. However there

is no guaranteed amount on survival of life insured in this plan.

LIC has introduced many ULIPs including Bima Plus, Future Plus and

Jeevan Plus, Market Plus, Fortune Plus and Profit Plus to satisfy the needs of

discerning customers who look for attractive returns, risk cover, flexibility and

liquidity all packed together. The above table explains awareness of the women

policy holders about ULIP. Of the women policy holders in the selected sample,

46.5 per cent are fully aware of the policy features and its benefits, 38 per cent of

the insured women are partially aware of the policy. Only 15.5per cent of the

women policy holders consisting of 19 organised women policy holders and 12

unorganised women policy holders are unaware of the ULIP.

Table 4. 68 Awareness of the Women Policy Holders about Pension Policies


Fully aware 22 16 38 19


Unaware 24 70 94 47

Total 100 100 200 100


Retirement for anyone should not mean the end of a life of a

financial freedom. Pension plans create a retirement kitty through periodic

contributions from the investor’s side. The payment can be done by the

policyholders in monthly, quarterly or annual mode during the working years.

The above table is constructed to explain the awareness of the women policy

holders about pension policies. Only 19 per cent of the women policy holders

accept that they are fully aware and 34 per cent are partially aware of the pension

plans. Of the 200 respondents 94 are completely unaware of pension plans.

182

Nearly, one-forth of the respondents from organised category and three-forth of

the respondents from unorganized category are yet to realize the benefits of

pension plan and the need to plan for the peaceful old age.

Table 4.69 Awareness of the Women Policy Holders about IRDA



Partially aware 44 13 57 28.5

Unaware 17 66 83 41.5

Total 100 100 200 100


Strengthening the reform process, Insurance Regulation and Development

Authorities (IRDA) Act 1999, was passed thereby becoming the second

significant legislation to govern the insurance sector after Insurance Act 1938.

Accordingly, IRDA was formed. IRDA plays a dual role of a regulator and a

developmental authority.

The awareness of the women policy holders about IRDA was tabulated

above. It shows that 30per cent of the insured women consisting of 39

respondents from the organised sector and 21 from the unorganized sector are

fully aware of the IRDA and its functions.

In addition to that 28.5 per cent of the respondents consisting of 44 from

organised category and 13 from unorganized category are partially aware of

IRDA. Majority of 41.5 per cent of the insured women consisting of 17 women

from organised category and 66 women from unorganised category are unaware

of the existence of IRDA.

183

Table 4.70 Awareness of Women Policy Holders about Women Policies




Unaware 13 27 40 20

Total 100 100 200 100


From the table it is evident that 20 per cent of the respondents consisting

of 24 women policy holders from organised category and 16 women

policyholders from unorganized category are fully aware of women insurance

policies. Sixty per cent of insured women comprising of 63 women policy

holders from organised category and 57 women policy holders from unorganized

category are partially aware about women insurance policies. One-fifth of the

insured women, a combination of 13 women of organised category and 27

women of unorganized category, are completely unaware of the women policies..

Table 4.71 Awareness of Women Policy Holders about Group Insurance




Unaware 9 13 22 11

Total 100 100 200 100


The tremendous growth of the economy and the consequential growth of

the organised sector lead the insurers to play a decisive role in designing various

group insurance schemes. Group insurance constitutes an important activity of

insurance business. A group should consist of persons who assemble together

with a commonality of purpose, engaging in common economic activity. The

184

above table is constructed by examining the awareness of the women policy

holders about group insurance. It is clear from the table that 26.5 per cent of the

respondents is fully aware of the group insurance schemes prevailing in the

insurance market: 11 per cent of the insured women are completely unaware of

the information regarding group insurance and 62.5 per cent of the respondents

are partially aware of the same.

Table 4.72 Awareness of Women Policy Holders about Guaranteed Additions


Fully aware 55 62 117 58.5


Unaware 12 12 24 12

Total 100 100 200 100


Under certain without profit plans, provided the policy is in full force, the

sum assured gets enhanced at the specified guaranteed rate at the end of each

year. The guaranteed additions will be payable with the sum assured. The above

table shows, awareness of the women policy holders about guaranteed additions.

It reveals that only 12 per cent of the women policy holders are unaware of the

guaranteed additions and irrespective of the category, majority of the

respondents, i.e., 88 per cent are fully or partially aware of the same additions.

Table 4.73 Awareness of Women Policy Holders bout Bonus Rate




Unaware 7 12 19 9.5

Total 100 100 200 100


185

Bonus is declared by LIC every year according to law and distributed to

the policy holders. There are different methods to distribute bonus. If the policy

follows simple reversionary bonus the same will be paid as and when the claim is

payable on maturity. The above table shows the level of awareness of the women

policy holders about the bonus rate. It reveals that only 9.5 per cent of the

women policy holders are unaware of the bonus rate and very high share of 46.5

per cent and 44 per cent of the insured women are partially aware and fully

aware about the rate of bonus for their policy, respectively. This may be because

of the agents’ enlightening them about the likely bonus rate, at the time of the

policy selection itself.

Table4.74 Awareness of Women Policy Holders about Surrender of Policy




Unaware 21 21 42 21

Total 100 100 200 100


The policy will acquire surrender value only if three years’ premiums are

paid. After this period, if the policy holder finds him unable to continue the

payment of premiums he can surrender the policy for a cash sum which is known

as surrender value. But it is to be guaranteed by the policy conditions and a

formula to arrive at the surrender value has to be provided in the policy

document according to Insurance Act 1938.

In a standard LIC policy the formula for the guaranteed surrender value

given is equal to 30 per cent of all the premiums paid excluding the first

premium and extra premiums and accident or disability premiums if paid. LIC

186

pays a more liberal surrender value called special surrender value. The present

values of the allotted bonuses are also added when surrender value is payable. At

the same time the policy holder alternatively can tide over a temporary difficult

by taking a loan on a sole security of the policy without delay. From the table

showing the awareness of the women policy holders about surrender of policy, it

could be observed that only 21 per cent of the respondents are unaware of the

surrender value of their life insurance policies. Almost every 4 out of 5 women

policy holders are fully or partially aware of the surrender value.

Table 4.75 Preference of Women policy Holders regarding the Various

Modes of Savings

RANK Bank P.O Chit Shar

es

P.F Jewel Real

estate

Insur

ance

1 22 40 30 0 61 46 0 1

2 49 51 42 0 8 27 0 23

3 35 44 23 0 32 43 0 23

4 48 36 36 0 13 41 0 26

5 32 29 49 1 14 22 29 24

6 14 0 19 38 27 21 37 44

7 0 0 1 64 45 0 42 48

8 0 0 0 97 0 0 92 11

Total 200 200 200 200 200 200 200 200

Weighted

total 1139 1237 1107 343 1028 1171 403 772

Percentag

e 15.82 17.18 15.38 4.76 14.28 16.26 5.6 10.72

Preference III I IV VIII V II VII VI


Though Insurance is primarily a risk cover product the element of saving

is also a motivating factor behind the policy holders subscribing policies. The

competitive advantage that life insurance enjoys is that in case of death the full

sum assured is made available under a life assurance policy whereas under other

187

savings schemes, the total accumulated savings alone will be available. The latter

will be considerably less than the sum assured, if death occurs during early years.

Life insurance in the traditional form with risk cover is really not an

investment. But many types of life insurance plans, at present, in our country are

combinations of insurance and investment. Investment is made out of money

specifically earmarked out of excess of income over expenditure to make the

money grow to be realized at a later date. Savings, on the other hand, is also

made out of the current income but it is made with some difficulty and very often

sacrificing present pleasure for future needs by consciously setting apart some

portion from the current income for definite future need like education, old age,

marriage, sickness etc.

Life insurance is more of a saving than investment. Other mode of

savings depicted in the above table are of “save and create” type. But life

insurance alone is of “create and save” type. Because in the first category the

individual have to save regularly and live long enough to complete the savings

programme. But in the second category, the amount one wanted to save is

created immediately with the payment of first premium. Thus, life insurance is

different from other mode of savings and investment.

The above table analyzes the ranking of various forms of savings by the

women policy holders. The Provident Fund (PF) is considered as the number one

saving mode, which was ranked by 61 women policy holders. This may be due to

the convenience of deductibility at source, and the tax claimability on savings

apart from and the element of retirement benefit.The PF mode was followed by

jewelery where 46 women policy holders considering it as number one, as the

easy monthly installment schemes offered by jewellery shops are very popular

among the respondents. The post office saving mode is ranked as number one by

188

a third majority of 30 women policy holders. This may be due to the easy

accessibility that the post office offers with its wider network. On the other hand,

of all the eight savings mode real estate, is not at all ranked as number one by

any of the women policy holder surveyed.

Assigning the weights to the ranks as eight to the rank one, seven to rank

two, and so on, the weighted preferences were found. Among these modes of

saving, Post Office stood as the first preference with a weighted score 1237 i.e.,

17.18per cent of the total value of the preferences.

While ranking the different modes of savings, jewellery was found to be

the second preference with weighted score of 1171, constituting 16.26 per cent of

the total. While ranking the other different modes of savings, Bank was the next

best savings mode with a weighted score of 1139 constituting 15.82 per cent of

the total.

The next mode of savings which is popular among the insured women

policy holders is chit fund with a weighted score of 1107 scores, constituting

15.38 per cent of the total. It was followed by PF mode with a weighted score of

1028 constituting 14.28 per cent of the total.

While ranking the various modes of savings on weighted scores base,

insurance is found in the sixth place with a weighted score of 772, constituting

10.72 per cent of the total.

The seventh and eighth places are occupied by real estate and shares

respectively with the weighted scores of 403 and 343.

189

Table 4.76 Preference of Organized Women Policy Holders Regarding Various

Modes of Savings

RANK Bank P.O Chit Share P.F Jewel Real

estate

Insur

ance

1 22 9 0 0 61 7 0 1

2 49 21 0 0 8 13 0 9

3 20 19 20 0 21 11 0 9

4 9 22 22 0 10 26 0 11

5 0 29 38 0 0 22 1 10

6 0 0 19 10 0 21 22 28

7 0 0 1 49 0 0 28 22

8 0 0 0 41 0 0 49 10

Total 200 200 200 200 200 200 200 200

Weighted

total 684 559 441 169 720 494 175 358

Percentage 19 15.53 12.25 4.69 20 13.72 4.86 9.94

Preference II III V VIII I IV VII VI


The above table explains the preferences of Insured women of organised

sector alone. Savings through bank is considered as the first best by 22 women

respondents and second best mode by 49 women insured policy holders. One-

fifth of the respondents consider bank as third best mode of savings.

Post office mode of savings is found within five out of eight ranks. The

chit fund mode enjoys the status of third to seventh rank by insured women

policy holders. Purchasing shares as a mode of savings is placed only as sixth to

eighth choice by the organised women policy holders and no woman ranked it in

first five places is notable.

The PF is the first priority for the majority of 61 women policy holders

and the rest of the respondents also give the rank varying from second to fourth.

190

Savings with jeweller as a mode of savings is given the ranks varying

from 5 to 8 and no women perceive real estate as comparatively better mode of

savings as it is not placed in first four places.

Insurance is invariably perceived differently and is placed in all the ranks

by one or the other women policy holders from organised category.

Analysing the weighted scores and percentage of women policy holders

from organised sector alone, the PF is found as the most preferable savings mode

with weighted scores of 720, constituting 20 per cent of the total value.

The savings at bank is treated as the second best mode of savings with a

weighted score of 684 with 19 per cent of the total value.

The savings in post office is ranked as third best mode of saving with a

weighted score of 559, constituting 15.53 per cent. As far as the organised sector

women are concerned, the fourth preference of savings is in the form of jewellery

which was assigned a weighted score of 494 and secured 13.72 per cent. Chit

mode is considered as the fifth choice of savings with a weighted score of

441constituting 12.25 per cent of the total.

Insurance is considered only as the sixth best mode of savings with a

weighted score of 358 constituting 9.94 per cent of the total. The seventh and the

eighth places were given to the real estates and shares, respectively with lower

weighted scores and are unpopular among the respondents of organized sector.

191

Table 4.77 Preference of Women Policy Holders of Unorganized Sector

Regarding the Various Modes of Savings

RANK Bank Post

Office

Chit Shares Provi

Funds

Jewel Real

estate

Insur

ance

1 0 31 30 0 0 39 0 0

2 0 30 42 0 0 14 0 14

3 15 25 3 0 11 32 0 14

4 39 14 14 0 3 15 0 15

5 32 0 11 1 14 0 28 14

6 14 0 0 28 27 0 15 16

7 0 0 0 15 45 0 14 26

8 0 0 0 56 0 0 43 1

Total 200 200 200 200 200 200 200 200

Weighted

total 455 678 666 174 308 677 228 414

Percentage 12.64 18.83 18.5 4.83 8.56 18.81 6.33 11.5

Preference IV I III VIII VI II VII V


The above table shows how the unorganized sector women perceive and

rank the various modes of savings. It clearly points out that purchasing Jewels is

preferred as the first best option, by 39 women policy holders; 14 others rank it

as a second best savings mode and 32 of the respondents prefer it as third best

mode of savings.

Post office savings is considered as best mode of savings by 31insured

women and 30 respondents placed it as second choice and 25 of them considered

this mode as the third option for savings. Saving through chit was considered as

first mode of savings by 30 respondents from unorganized category and 42 others

appreciate it as second best option. Bank is, to certain extent, unpopular among

the respondents from the unorganized sector and savings through bank is ranked

between the places of 3 to 6 only. Saving in shares also fails to attract the women

from unorganized sector which occupies the ranks 5 to 8. Of the 100 women

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surveyed 56 assign only the last rank to the savings through shares. Real estate is

placed in the ranks between 5 and 8 and 43 consider real-estate as the last resort

for their savings.

When we take into account insurance as a savings mode, it is assigned

ranks varying from second to eight by the respondents. While 14 respondents

assign second rank to insurance mode one respondent perceive it as the last resort

for savings.

Analysing the weighted scores of the various savings mode based on the

ranks given by the insured women policy holders of unorganized category, the

post office savings is found as the primarily preferred mode with 678 weighted

scores consisting 18.83 per cent of the total scores. The savings in terms of

jewellery is treated as the second best mode of savings with a weighted score of

677, constituting 18.81 per cent of the total. The chit is ranked as third mode of

preference with a weighted score of 666 expressed in percentage as 18.5. Fourth

preference is attained by savings through bank which has a weighted score of

455 and constituting 12.64 per cent of the total. Insurance is considered as fifth

choice of savings with a weighted score of 414, constituting 11.5 per cent of the

total scores. PF is considered as the sixth best mode of savings which is

represented by the 8.56 per cent, of the weighted score.

The real estate is in seventh place with a weighted score of 228

constituting 6.33per cent and the last eighth place is retained by shares and units

which have a weighted score of 174, representing just 4.83per cent of the total.

From the above analysis, it is clear that though insurance is not primarily a

savings instrument, it is perceived so, ahead of the savings modes like PF, real

estate, and shares and units by the insured women from unorganized sector.

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Table 4.78 Perception of Women Policy Holders Regarding the Utility of

Insurance

RANK Risk cover Tax saver Savings

instrument

1 81 65 54

2 64 56 80

3 55 79 66

Total 200 200 200

Weighted total 426 386 388

Percentage 35.5 32.17 32.33

Preference I III II


The above table explains whether women policy holders view insurance

as a risk cover, tax saver and or as a savings instrument. While, 81 women policy

holders consider the prime utility of insurance of insurance is the risk cover, 64

women policy holders place second rank and 55 others registered the third rank

for the same. It is evident that majority perceive the prime utility of insurance is

to cover risk, assigning the first rank. When we take in to account insurance as a

tax saver, 65 respondents assign first rank and 56 policy holders assign the

second and majority of 79 respondents register the third rank.

Similarly 54 women policyholders consider insurance primarily as a

saving instrument, assigning first rank and 80 others assign second rank to this

feature and 66 respondents assign only third rank. To summarize, most of the

women policy holders perceive insurance as a risk cover and assigning it in the

first place and insurance as a savings instrument in the second place and

insurance as a tax saver in the third place.

Assigning the weights to the ranks as three, two and one to the three ranks

in order, the weighted scores were found. These scores also confirm that

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insurance is mainly preferred as a risk cover, sharing 35.5 per cent of the

weighted score. As the second choice, it is preferred as a savings instrument,

which is evident from the weighted share of 32.33 per cent. Only as the third

choice, insurance is preferred as a tax saver sharing 32.17 per cent of the

weighted scores.

Table 4.79 Perception of Women Policy Holders of Organsied Sector Regarding

the Utility of Insurance.

RANK Risk cover Tax saver Savings instrument

1 21 49 30

2 32 39 29

3 47 12 41

Total 100 100 100

Weighted

total

174 237 189

Percentage 29 39.5 31.5

Preference III I II


The above table shows how the respondents from organised category view

insurance i.e whether as risk cover, tax saver or savings instrument regarding the

usefulness of insurance. Nearly one-fifth of the respondents prefer insurance as a

risk cover in first place, 32 respondents find insurance as a risk cover in second

place and a high of 47 respondents rank it in third place.

Remarkably 49 respondents perceive insurance primarily as a tax saver,

39 give second rank to this utility and only 12 of the respondents opt to assign

the third rank to this utility. Similarly, 30 women policy holders from organised

sector perceive insurance mainly as a savings instrument, 29 respondents

assigned the second rank to this utility and a high of 41 women policy holders

assign the third rank for the same. To sum up, of all the three utilities of

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insurance ranked tax saver score is found high in first place when the

perceptions of insured organised women policy holders alone are considered. It is

true to conclude that the respondents from organised sector purchase insurance

mainly for tax saving purposes.

The weighted scores of perception of women policy holders also shows

that the usefulness of insurance as a tax saver stands in the first place with a

weighted score of 237, representing 39.5 per cent of the total score.

Insurance as a savings instrument stands as the second preference with a

weighted score of 189 representing 31.5 per cent of the total score. Insurance as a

risk cover is the third preference with a weighted score of 174 representing 29

per cent of the total.

For organised women policy holders the usefulness of insurance as a tax

saver is the most crucial one. Even though the insurance is primarily a risk cover,

this is relegated to the third position in the perception of the respondents from the

organised category.

Table 4.80 Perception of Women Policy Holders of Unorganised Category

Regarding the Utility of Insurance

RANK Risk cover Tax saver Savings instrument

1 60 16 24

2 32 17 51

3 8 67 25

Total 100 100 100

Weighted total 252 149 199

Percentage 42 24.83 33.17

Preference I III II


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The above table shows the ranking of perception of unorganised women

policy holder regarding the usefulness of insurance. While ranking insurance as a

risk cover, 60 out of 100 respondents prefer to assign the first rank and 32

respondents place it in second rank and 8 respondents place the risk cover feature

in third rank.

While ranking the usefulness of insurance as a tax saver, 16 women

policyholder prefer to give the first rank to this utility, 17 insured women place

second rank and a high 67 respondents assign third rank to this utility.

While ranking the usefulness of insurance as a savings instrument, 24

women policy holders from organised sector place first rank to this utility, 51

respondents place second rank and 25 others prefer to give third rank. To

conclude, women policy holders from unorganized sector purchase insurance for

risk coverage as a prime motive and tax saving element as the last one.

The weighted scores of perception also reveal that the usefulness of

insurance as a risk cover stands in the first preference with a weighted score of

252 representing 42 per cent of the total.

Insurance as a savings instrument stands as the second preference with a

weighted score of 199, expressed in percentage as 33.17per cent. Insurance as a

tax saver is the third preference with a weighted score of 149, constituting 24.83

per cent of the total scores.

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Table 4.81 Satisfaction Index of Women Policyholders

Statement

Much L.T exp

( - 2 )

Less Than exp.

( - 1 )

As exp

( 0 )

More Than expected

( + 1 )

Much more

( + 2 )

Mean Score

Nos.

per

cent Nos.

per

cent Nos.

per

cent Nos. per cent Nos.

per

cent

Ease of forms 38 19 67 33.5 65 32.5 29 14.5 1 0.5 -0.560

Medical exam 6 3 73 36.5 76 38 41 20.5 4 2 -0.180

Product features 26 13 39 19.5 101 50.5 32 16 2 1 -0.275

Granting of

policy loans 12 6 43 21.5 109 54.5 31 15.5 5 2.5 -0.130

Loan recovery

procedures 6 3 41 20.5 114 57 30 15 9 4.5 -0.025

Settlement of

claims 11 5.5 75 37.5 95 47.5 14 7 5 2.5 -0.365

Grievance

settlement 2 1 79 39.5 84 42 22 11 13 6.5 -0.175

Amount of

premium 0 0 22 11 111 55.5 59 29.5 8 4 +0.265

Issue of

premium dd

notice

4 2 41 20.5 115 57.5 32 16 8 4 -0.005

Bonus amount 8 4 81 40.5 87 43.5 20 10 4 2 -0.345

Change of

nomination 6 3 46 23 96 48 44 22 8 4 +0.010

Surrender of

policy 8 4 53 26.5 108 54 23 11.5 8 4 -0.150

Revival of

policy 8 4 72 36 90 45 21 10.5 9 4.5 -0.245

Change of

address 7 3.5 48 24 105 52.5 35 17.5 5 2.5 -0.085

Transfer of

policy 7 3.5 54 27 107 53.5 26 13 6 3 -0.150

Policy status

notice 7 3.5 49 24.5 83 41.5 51 25.5 10 5 +0.040

Courtesy of staff 0 0 42 21 113 56.5 44 22 1 0.5 +0.020

Age of admn 6 3 36 18 130 65 21 10.5 7 3.5 -0.065

Satisfaction Index of Women Policy Holders - 0.134

After evaluating the role of intermediaries and infrastructure the

satisfaction level of women policy holder on the core aspects such as the

attributes of price, product and various processes are analyzed. As insurance is a

contractual agreement enforceable by law, the proposer, must have to read and

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understand the whole document. So ease of forms is the first expected aspect for

any proposer. The above table explains that 32.5 per cent of the respondents feel

that the forms are as expected and 15 per cent feel that the forms are simpler than

the expected level. On the other hand, more than half of the respondents feel that

they are not satisfied with the nature and language of the paper works.

Next to proposal form the medical examination of the proposer is a pre

requisite if the policy is coming under medical scheme. Medical examination is

necessary for illiterate female lives, pregnant ladies and females without income,

physically handicapped lives, non-resident Indian cases, persons employed in

hazardous occupation, those whose weight is beyond non medical eligibility,

persons other than doctors attending leprosy, tuberculosis patients, class iv

employees working in hospitals, risk plan for minor lives those whose latest

policy is accepted with health extra, and for persons having adverse health

history. The above table shows that 38 per cent of the respondents feel satisfied

as expected and 22.5 per cent others feel the same with higher degrees. On the

other hand, 39.5 per cent feel that they are not satisfied to the level they

expected.

Each policy has its own features. The product may be linked or non

linked, with profit or without profit, whole life or endowment, convertible, non-

convertible. Though one chooses a policy that suits to her need, at times, she may

not be convinced with all the features attached to the policy. The table shows that

half of the respondents feel satisfied as they have expected and 17 per cent feel

that they are highly satisfied. On the other hand, 32.5 per cent of the respondents

feel that the policy features are not up to the expectations.

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As far as the granting of policy loans is concerned, nearly 72 per cent of

the respondents feel that the speed and ease in granting of policy loans do not fall

below their expectations. The rest 28 per cent of the respondents feel that the

granting of loan is not up to their expectations. This is not only because of their

bitter experiences at the time of sanctioning, but also a few being refused the

loan as ineligible.

As far as loan recovery procedures is concerned, nearly three-forth of the

respondents feel satisfied, equaling or exceeding their expectations. Only, 23.5

per cent of the respondents feel that their loan recovery procedure is not upto the

level expected.

On the aspect of claim settlement, the respondent cannot have the personal

experience for their own policies that they are presently in possession of. But,

from the experiences of maturity claims of their other policies and of the policies

of others and death claims of policies of their friends and relatives, they express

their satisfaction towards efficiency of LIC in claims settlement. While 47.5 per

cent of the respondents feel that they are satisfied with this aspect, 9.5 per cent of

them feel that LIC excels in this aspect exceeding with their expectations. On the

other hand, 43 per cent respondents, feel that their expectations are yet be met

with, regarding claim settlement.

Commenting on the grievance settlement mechanism, of the insurer, 42

per cent feel that they are satisfied and 72.5 per cent certify that LIC exceeds

their expectations in settling their grievances, immediately and effectively.

Around 40.5 per cent of the respondents feel that they are not satisfied as they

have expected, on this grievance handling mechanism.

200

The amount of premium is very well known at the time of proposal itself.

But, depending on the nature of policy, age, mode of payment of premium and

the additional riders attached with, it varies from policy to policy and person

and person. Of the total respondents, 55.5 per cent feel satisfied, as the premium

amount is in the expected pre-determined level. One –third of the respondents

feel that their satisfaction is more than the expected level. The concession in the

premium to the select mode may be reason for the same. Only 11 per cent feel

that their satisfaction was not up to the expected mark as far as the premium is

concerned. This may be because of the extra loading to the level premium for

monthly modes and for offering the riders like death accident benefit which one

can avail only at the time of risk occurring at an accident.

As far as premium notice is concerned, 57.5 per cent of the respondents

feel that they feel satisfied to the level they expected. One-fourth of them find

themselves satisfied and highly satisfied at an unexpected level. On the other

hand, 22.5 per cent of the respondents feel that their expectations are not fulfilled

fully.

Regarding bonus, 43.5 per cent of the respondents feel satisfied and 12 per

cent others feel that the bonus amount is very much higher than the amount they

expected. On the other hand, 44.5 per cent feel that the bonus rate is not up to the

level as they expected from the insurer.

Nomination is a process of identifying a person to receive the policy

amount in the event of death of the policy holder. Nomination can be done at the

start of the policy or at a later date. The nomination is to be effected by giving

notice in a prescribed form to LIC and getting it endorsed on the policy bond.

Change of nomination can be done by the policy holder any time during the term

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of the policy and any number of times. For this the policy holder has to give a

notice in a prescribed form to LIC and getting it endorsed at the back of the

policy. As far as the change of nomination is concerned three-fourth of the

respondents feel satisfied with various degrees and one-forth of them feel that

they are not satisfied with the level expected.

The cash value payable by the insurer on termination of the policy

contract at the desire of the policy holder but before the expiry of term is known

as surrender value. The above table shows that around 70 per cent of the

respondent feel that LIC is up to the expectation on this aspect. But nearly 30 per

cent of the respondents feel that they are not satisfied with the present system of

surrendering. This is because of the fact that there is no surrender value at all, if

the policy is kept in force for at least three years and even after the period, only a

portion of the paid up value of premium is given as surrender value.

If the premium due is not paid within the days of grace, the policy lapses.

A lapsed policy can be revived any time, within five years from the date of first

unpaid premium. Under ordinary revival scheme, all the arrears of unpaid

premium with interest have to be paid. If the person is not in a position to pay all

the arrears, he can choose special revival scheme. Even if the policy cannot be

revived under special revival scheme, he can make use of revival by installment

method. If a policy acquires surrender value on the date of revival, the policy

can also be revived taking a policy loan. Similarly, the survival benefit which

falls due in a money- back type policy can also be used for revival of the policy.

The above table reveals that 45 per cent feel that they are satisfied with

the procedure since it is as expected and 15 per cent feels that they are highly

satisfied with the revival option of LIC. But 40 per cent of the respondents feel

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that revival of policy is not that much easier and economical as they have

expected. They view that eight per cent interest on revival of policy may be

reduced.

As far as the insurer entertaining any change of address intimated,

respondents feel satisfied in 72.5 per cent cases and in 27.5 per cent cases the

response of LIC is not satisfactory.

Similarly, while nearly 70 per cent of the respondents feel satisfactory

with the speed and of the transfer of policy, around 30 per cent do not feel so and

the speed is not up to the their expectation. In the e-enabled environment they

expect the transfer being a real time one.

Just like premium demand notice, a separate policy status notice for each

policy is also sent to the policy holders. Regarding the content and timing of

policy status notice, 41.5 per cent of the respondents feel satisfied and 30.5 per

cent others feel that it is so beneficial to trace their payment or non payment of

premium and feel their satisfaction is beyond their expectation. Only 28 per cent

feel that they are not satisfied on this aspect. They are either not in receipt of the

notice or expecting some more details in the notice in the vernacular language.

As far as the courtesy of staff of the branch is concerned, 21 per cent of

the respondents feel that they are not satisfied and the rest of the respondents feel

they are treated well.Finally, their views about the age of administration are

obtained. There are restrictions to minimum and maximum age of entry and these

restrictions vary from policy to policy. Around four-fifth of the respondents feel

that they are satisfied with this aspect and one-fifth of them feel that it is not up

203

to their expectations. They feel that uniform age at entry maybe followed for

majority of the policies.

Factor analysis: To test the sampling adequacy and to identify that the

factor model is appropriate to adopt, the Kaiser-Meyer-Olkin (KMO) test and

Bartlett’s test were employed. KMO test value is more than 0.5, which indicates

that the factor analysis for this data is very useful. As Bartlett’s tests level of

significance is also less than 0.05, factor analysis is useful for this data.

In the table showing the initial eigen values, total column gives the eigen

values or amount of variance in the original values accounted for by each

component. The percentage of variance column gives the ratio, expressed as a

percentage of the variance accounted for by each component to the total variance

in all of the variables. The cumulative percentage column gives the percentage of

variance accounted for the n components.For the initial solution, there are as

many components as variables and in a correlation analysis the sum of the eigen

values equals the number of components. In the process of factor analysis eigen

values greater than one is extracted. So the first six principal components form

the extracted solution. The extraction sums of squared loadings table shows the

extracted components. They explain nearly 59 per cent of the variability in the

original 18 variables. So the data can be considerably reduced the complexity of

the data set by using these components with only 41 per cent loss of information.

The rotation maintains the accumulative per cent of variation explained by

the extracted components but the variation is now spread more evenly over the

components. The Scree plot helps to determine the optimal number of

components. The eigen value of each component in the initial solution is plotted.

Generally the components on the steep slope are to be extracted. The components

204

on the shallow slope contribute little to the solution. The last big drop occurs

between sixth and seventh components. So, using the first six components is an

easy choice.

The rotated component matrix helps to determine what the components

represent. The first component is moderately correlated with age of admission.

The second component is moderately correlated with ease of forms. The third

component is moderately correlated with granting of policy loans, the fourth

component is correlated with settlement of claims. The fifth component is

moderately correlated with product features and the sixth component is

correlated with the amount of premium.This suggests that focus can be made on

age of admission, ease of forms, granting of policy loans, settlement of claims

and amount of premium in further analysis but one can do even better by saving

component scores. For each case and each component, the component score is

computed by multiplying cases’ standardised variable values by the components

score co-efficients. The resulting six components score variables are

representatives of and be used in place of the 18 original variables with only 41

per cent of information. Using the saved component is also preferable to using

age of admission, ease of forms, granting of policy loans, settlement of claims

and amount of premium because the components are representative of all 18

original variables and the components are not linearly correlated with each

other. The linear correlation between the components is to be zero. Therefore, it

is concluded that the satisfaction level of women policy holders which is not

positively correlated with their expectations from the given 18 variables.

To verify the result, satisfaction index of women policy holders was

prepared as found in table 4.81. This index is the overall mean average of the

mean score for each statement. The index value -0.314 also confirm the inference

205

from factor analysis. That is, the satisfaction level of women policy holders is not

positively correlated with their expectations.The satisfaction index constructed

for this purpose further reveals that satisfaction is more than the expected level

on the four attributes namely, the premium amount (0.265), charged by the

insurer, policy status notice(0.040), courtesy of staff at LIC office(0.020), and

change of nomination(0.010).

Though they expect better performance from LIC on all the other 14

aspects, the weighted score of the dissatisfaction is high in case of ease of forms.

Next to ease of forms, it is the claim settlement aspect wherein the customers still

expect more from the insurer by means of simpler and speedy settlements.

Thirdly, the gap between the expectations and satisfactions is found glaring on

the aspect of bonus. The respondents feel that they are not intimated with the

bonus amount. They further feel that the rate of bonus, which is noted in terms of

thousand rupees of sum assured per annum, is misleading and may be expressed

as percentage. A few others feel that the bonus rate is too low as if the insurance

is a savings instrument in nature. Some of the respondents are expecting the

bonus to be paid in cash every year.Next to the bonus amount, the gap between

the expectation and satisfaction gets narrowed down in case of the following

attributes in the following order: product features(-0.275), policy revival (-

0.245), medical exam procedures(-0.180), grievance settlement(-0.175),

surrender of policy (-0.150), transfer of policy (-0.150), granting policy loans(-

0.130), age of admission(-0.065) and loan recovery procedures(-0.025). The

above analysis thus proves the final hypothesis of the study i.e., the women

policy holders’ expectations are not satisfied as expected.