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TRANSCRIPT
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SYNOPSIS
ON
“A Study of awareness of Financial Planning among customers incontext of investment in Traditional Market and Insurance”
At
HDFC STANDARD LIFE INSURANCE COMPANY
(Submitted in partial fulfillment of the requirement of
Master of Business Administration, Distance Education,
IMT, Ghaziabad)
Research Supervisor: Submitted by:
MR. PRAKASH SUBEDI DEEPTI JAINTERRITORY MANAGER, HSLIC Enrollment No. 0621000665
MBA (FINANCE) VI SEM
Session 2006-09
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It is hereby informed that myself Deepti Jain Roll No 0621000665 has joined summer
training programme in HDFC STANDARD LIFE INSURANCE CO. for three months.
• Chairman(HDFC Ltd.) : Mr. Deepak Parekh
• C.E.O. & M.D. (HDFC SLIC) : Mr. Deepak Satawalekar
• G.M. Sales : Mr. Suresh Mahalingam
• Regional Manager : Mr. Satish Soni
Under the authority of
Name: Mr. Prakash Subedi
Designation: Territory Manager
Here the respected sir gives me knowledge about their financial planning
process in co. He suggested me how to deal with their customers.
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ACKNOWLEDGEMENT
Any accomplishment requires the effort of many people and this work is no different. It
has been my proud privileges to be attached to do research on such a topic which gave
me the chance to get connected with some great people who are thoroughly professional
i.e., staff of HDFC SLIC. With due respect I express my indebtness to the management of
HDFC Standard Life Insurance Company. For accommodating me to have a look into
their systems and providing me with all information I needed to complete my research
Work
I would also like to thank Mr, Prakash Subedi , my guide and all those who directly or
indirectly helped in this project would have never been accomplished.
I would also thankful to almighty god for his grace and mercy to successfully complete
this project.
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TABLE OF CONTENTS
TOPIC PAGE NO.
1. ACKNOWLEDGEMENT 2
2. INTRODUCTION 3
3. COMPANY’S PROFILE 4
4. OBJECTIVES OF THE STUDY 9
5. SCOPE OF THE STUDY 10
6. METHODOLOGY 12
7. HISTORY OF INSURANCE 13
8. INDIAN INSURANCE INDUSTRY 15
9. MARKET SHARE 24
10. CONCEPTUAL FRAMEWORK 27
11. FINANCIAL PLANNING PROCESS 33
12. TRADITIONAL MARKET VS INSURANCE 41
13. INVESTMENT IN MUTUAL FUND VS ULIPS 45
14. DATA ANALYSIS AND INTERPRETATION 54
15. QUESTIONNAIRE 58
16. CONCLUSION 60
17. RECOMMENDATIONS 62
18. CHALLENGES AND LIMITATIONS 63
19. BIBLIOGRAPHY 64
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OBJECTIVES OF THE STUDY
The Objective of the study is to determine the extent of awareness of financial planning
in India and the understanding of insurance among the masses. The Scope of the study
involves
To understand the concept of financial planning.
To advice people to invest in the Unit Linked Products of HDFC Standard Life
Insurance Co.
To compare traditional investment instruments (Mutual Funds etc. ) with
investment in Insurance.
To analyze various Unit Linked Plans offered by HDFC Standard Life Insurance
Company.
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Data Analysis and Interpretation
Q.1 Do you know what is insurance?
65%
35%
Ye
N
Q.2 Do you know about ULIPs?
65%
35%
Ye
N
Q.3 What is Investment?
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70%
30%
Y
N
Q.4 Where you want to invest your money?
20%
20%60% Security Mar
Depository In
Financial Inst
Q.5 In which type of financial institutions you want to invest your money?
35%
30% 35%
Insurance Co.Investement Bank
Mutul Fund
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Q.6 Are you interested in Risk cover or Return ?
60%
40%
Yes
No
Q.7 Who is Better ?
60%
40% ULIP
Mutul Fun
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Q.8 Under which section you are looking for tax exemption?
70%
%
10%10%
80 C
80 D
80 E
Oth
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Questionnaire
Q.1 Do you know about Insurance?
a. Yes b. No
Q.2 Do you know about ULIP(United Life Insurance Policy)?
a. Yes b No
Q.3 In which policy you want to invest more?
a. Market-Driven
b. Fixed Amount Policy
Q.4 Are you interested in more risk cover or returns?
a. Risk cover
b. Returns
Q.5 Which type of investment you are looking for?
a. Short term Investment
b. Long term Investment
Q.6 How you want to pay your premium?
a. Lump sum
b. Once in year
c. Monthly
Q.7 Where you want to invest your money?
a. In govt. institutions
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b. Private sectors
Q.8 Are you looking for tax assumptions?
a. Yes b. No
Q.9 Under which section you are looking for tax assumptions?
a. 80C b. 80D c.80E
Q.10 Are you looking for retirement plan or not?
a. Yes b. No\
Q.11 Do you like to go for insurance after your policy ends?
a. Yes b. No
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CONCLUSION
Life Insurance is now being regarded as a versatile financial planning tool. Research
indicates that Indians have four basic financial needs during their life time:
1. Asset accumulation such as buying a house or a car.
2. Protecting their family
3. Securing their children’s education
4. Planning for their retirement.
India being a country of vast population of over one billion with only 33.2% of the
insurable population in India possessing Life insurance, the country has a vast potential
which has been left untapped now.
Till some years back, most of the people used to invest in traditional market (i.e. Equity,
Bonds, Mutual funds, Government securities and bonds etc.), but with the emergence and
popularity of Unit Linked Insurance products, the mindset has changed. One can see that
insurance is a better choice while making investment decisions because of features like:
1. Tax savings
2. Better returns
3. Protection from any miss happening.
The need of the hour is recognize the power of the Financial Planning. One who can draw
out a well defined financial plan according to his needs would expect good returns from
the market in the long run. How ever the awareness of financial planning among the
consumers is still low but with the increase in purchasing power of the customers andwith
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coming up of new innovative products customers have started to plan for their financial
needs and in coming years the awareness is expected to increase.
Thus insurance industry has tremendous growth opportunities provided that it meets the
expectations of the customers. The changing products of insurance with changing needs
of the customers can be a major cause for the growth of the insurance industry.
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SUGGESTIONS
Need to innovate and use differentiated strategies in sales, distribution and
marketing.
Distribution channel should be made more efficient.
The edge of the ULIPs over the products like mutual funds and investment in
equities should be appropriately promoted and should be made known to the
people.
The quality of the sales force should be improved.
Right customer identification and thus segmentation which needs to be accurate.
The population residing in the rural areas must be prompted to invest in Insurance
products.
Customer should be informed beforehand about the fluctuating returns from the
market.
After sales services should be improved
Claim settlement etc. should be made less harassing.
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CHALLENGES AND LIMITATIONS
1. Lack of financial assistance caused the study to be limited over a confined area.
2. Lack of knowledge among people about insurance as a investment product
remained the cause for not getting proper responses from some of the people.
3. As the Unit Linked plans are market dependent and have certain amount of risk
associated with them, people do not easily trust them.
4. Aggressive sales strategy of Private insurance players may cause inconvenience to
some people. Thus they do not furnish correct information in the questionnaire
filled by them
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BIBLIOGRAPHY
1. Kothari, C.R., Khan, TATA McGraw Hill Publishing Company Ltd., 2004.
2. www.moneycontrol.com
3. www.hdfcinsurance.com
4. www.metlife.com
5. www.sbi-insurance.com
6. www. Bajajallianzlife.com
7. www.sbi-insurance.com
8. www.google.com