A

Training ReportOn

Customer buying behavior

Of

Submitted By

Narendra Singh Thakur

MBA Full Time CourseII Semester

Bansal MBA College

Barkatullah University

Bhopal ( M.P.)

1

SESSION - 2008-10

Preface

o The success story of good market share of different market

organizations depends upon the availability of the product and services

near to the customer, which can be distributed through a distribution

channel. In Insurance sector, distribution channel includes only agents

or agency holders of the company. The customer satisfaction is the key

factor of any successful organization and it is essential to know the

customers taste for those organizations which want to survive in the

cut throat competition in the market.

o The primary objective of the research is SWOT analysis of the

customers or taste of the customer. This is the study of customer’s

behavior because in today’s competitive world the customer fascinates

by the ads and the customers carried away by the ads change their

choice and tastes that’s by the organizations need to know the

behavior of the customers.

o The research made on customer behavior buying with a focus on

market segmentation of HDFC Standard Life Insurance Company

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because in today’s context the insurance sector is a boom sector in

which a lot of companies are surviving in cut throat competition and

every company wants to capture the market for which the behavior of

the customer always plays a key role.

Acknowledgement

I would like to pay my words of thanks to Dr. R S Tiwari director of Bansal MBA College Bhopal, who has given me this golden opportunity to take 45 days training at HDFC Standard Life Insurance Company & Mr.Vipin Tiwari Business Development Manager HDFC Standard Life Insurance Company Branch Bhopal Cinema, Bhopal Who was my Field guide & trainer.

I am very grateful to my esteemed faculties especially for Mr. Vinod sharma who provided me a right direction to utilize the time, during the training, & proper guidence.

In the last but not least, I would like to express my hearty thanks to my family who has given me financial support & encouraged me to do the best. Besides my family I also thank to my friends who inspired me to put the best effort for the report & I thank to all those people who co operated me to the completion the training.

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Narendra Singh Thakur

MBA 2ND

Semester

Certificate

This to certify that Mr. Narendra Singh Thakur, is a regular student of MBA II Semester of Bansal MBA College Bhopal, has successfully completed minor research project entitled.

Marketing research has been made on …….

“Customer Buying Behavior with a focus on market segments”.

We have examine the training report & found it satisfactory for the fulfillment of the project requirement for the subject Summer training report of MBA (FT) II sem. Bansal MBA College Bhopal examination 2009.

This report is completed under my supervision .It is only for academic purpose and is a bona fide work done by researcher.

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Project guide: Mr. Vinod Sharma

Director: Dr. R S Tiwari

Bansal MBA College Bhopal

Date:

Place:

Declaration

I, undersigned Narendra Singh Thakur, hereby declare that the training report entitled Customer- buying behavior is based on my original work of my dedication to the work.

This is a genuine work done by me & the information has been collected, is authentic to the best of my knowledge & belief.

The training report was undertaken as a part of MBA curriculum at Bansal MBA College, Barkatullah University Bhopal (MP)

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Narendra Singh Thakur

MBA 2nd Semester

Contents Chapter 1 Introduction

Chapter 2 Company profile Board members Company’s products Corporate objective

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Chapter 3 Research methodology Objective & Significance Research Design Data Collection

Chapter4 Facts & Findings Data

Collection & Interpretation

Chapter 5 Conclusion Suggestion Limitations

Chapter 6 Appendix

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Chapter 1

Introduction

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IntroductionThe history of Indian insurance industry:

o Life insurance

In 1818 the British established the first insurance company in India in

Calcutta, the Oriental Life Insurance Company. First attempts at regulation of

the industry were made with the introduction of the Indian Life Assurance

Companies Act in 1912. A number of amendments to this Act were made

until the Insurance Act was drawn up in 1938. Noteworthy features in the Act

were the power given to the Government to collect statistical information

about the insured and the high level of protection the Act gave to the public

through regulation and control. When the Act was changed in 1950, this

meant far reaching changes in the industry. The extra requirements included

a statutory requirement of a certain level of equity capital, a ceiling on share

holdings in such companies to prevent dominant control (to protect the

public from any adversarial policies from one single party), stricter control on

investments and, generally, much tighter control. In 1956, the market

contained 154 Indian and 16 foreign life insurance companies. Business was

heavily concentrated in urban areas and targeted the higher echelons of

society. “Unethical practices adopted by some of the players against the

interests of the consumers” then led the Indian government to nationalize

the industry. In September 1956, nationalization was completed, merging all

these companies into the Life Insurance Corporation (LIC)

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Some of the important milestones in the life insurance business in

India are:

1912: The Indian Life Assurance Companies Act enacted as the first

statute to regulate the life insurance business.

1928: The Indian Insurance Companies Act enacted to enable the

government to collect statistical information about both life and non-life

insurance businesses.

1938: Earlier legislation consolidated and amended to by the Insurance

Act with the objective of protecting the interests of the insuring public.

1956: The market contained 154 Indian and 16 foreign life insurance

companies.

o General Insurance

The General Insurance industry in India dates back to the

Industrial Revolution and the subsequent increase in trade across

the oceans in the 17th century. As for Life Insurance, the British

brought General Insurance to India, and a similar path was

followed in the development of this industry. A number of private

companies were in existence for years and years until, in 1971,

the Indian Government decided that the public interest would be

served by nationalizing the industry, merging all the 107

companies into four companies, depending on the sort of

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business transacted (Marine, Fire, Miscellaneous). These were

the National Insurance Company Ltd., the Oriental Insurance

Company Ltd., the New India Assurance Company Ltd., and the

United India Insurance Company Ltd. located in Calcutta, New

Delhi, Bombay and Madras respectively. The General Insurance

Corporation (GIC) was set up in 1972 as a ‘holding’ company,

having these four companies as its subsidiaries.

Some of the important milestones in the general insurance business

in India are:

1907: The Indian Mercantile Insurance Ltd. set up, the first company to

transact all classes of general insurance business.

1957: General Insurance Council, a wing of the Insurance Association of

India, frames a code of conduct for ensuring fair conduct and sound business

practices.

1968: The Insurance Act amended to regulate investments and set

minimum solvency margins and the Tariff Advisory Committee set up.

1972: The General Insurance Business (Nationalization) Act, 1972

nationalize the general insurance business in India with effect from 1st

January 1973. 107 insurers amalgamated and grouped into four companies

viz. the National Insurance Company Ltd., the New India Assurance

Company Ltd., the Oriental Insurance Company Ltd. and the United

India Insurance Company Ltd. GIC incorporated as a company.

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MAJOR PLAYERS OF INSURANCE

INDUSTRY IN INDIA

o Life Insurance Corporation of India (LIC)

Life Insurance Corporation of India (LIC) was established on 1 September

1956 to spread the message of life insurance in the country and mobilise

people’s savings for nation-building activities. LIC with its central office in

Mumbai and seven zonal offices at Mumbai, Calcutta, Delhi, Chennai,

Hyderabad, Kanpur and Bhopal, operates through 100 divisional offices in

important cities and 2,048 branch offices. LIC has 5.59 lakh active agents

spread over the country.

The Corporation also transacts business abroad and has offices in Fiji,

Mauritius and United Kingdom. LIC is associated with joint ventures abroad in

the field of insurance, namely, Ken-India Assurance Company Limited,

Nairobi; United Oriental Assurance Company Limited, Kuala Lumpur; and Life

Insurance Corporation (International), E.C. Bahrain. It has also entered into

an agreement with the Sun Life (UK) for marketing unit linked life insurance

and pension policies in U.K..In 1995-96, LIC had a total income from premium

and investments of $ 5 Billion while GIC recorded a net premium of $ 1.3

Billion. During the last 15 years, LIC's income grew at a healthy average of

10 per cent as against the industry's 6.7 per cent growth in the rest of Asia

(3.4 per cent in Europe, 1.4 per cent in the US). LIC has even provided

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insurance cover to five million people living below the poverty line, with 50

per cent subsidy in the premium rates. LIC's claims settlement ratio at 95 per

cent and GIC's at 74 per cent are higher than that of global average of 40

per cent. Compounded annual growth rate for Life insurance business has

been 19.22 per cent per annum

o General Insurance Corporation of India (GIC)

The general insurance industry in India was nationalized and a government

company known as General Insurance Corporation of India (GIC) was formed

by the Central Government in November 1972. With effect from 1 January

1973 the erstwhile 107 Indian and foreign insurers which were operating in

the country prior to nationalization, were grouped into four operating

companies, namely, (i) National Insurance Company Limited; (ii) New India

Assurance Company Limited; (iii) Oriental Insurance Company Limited; and

(iv) United India Insurance Company Limited.  (However, with effect from

Dec'2000, these subsidiaries have been de-linked from the parent company

and made as independent insurance companies).

Besides the domestic market, the industry is presently operating in 17

countries directly through branches or agencies and in 14 countries through

subsidiary and associate companies.

o In addition to state insurers the following have been

permitted to enter into insurance business :-

The introduction of private players in the industry has added to the colors in

the dull industry. The initiatives taken by the private players are very

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competitive and have given immense competition to the on time monopoly

of the market LIC. Since the advent of the private players in the market the

industry has seen new and innovative steps taken by the players in this

sector. The new players have improved the service quality of the insurance.

As a result LIC down the years have seen the declining phase in its career.

The market share was distributed among the private players. Though LIC still

holds the 75% of the insurance sector but the upcoming natures of these

private players are enough to give more competition to LIC in the near

future. LIC market share has decreased from 95% (2002-03) to 82 %( 2004-

05).

1. HDFC Standard Life Insurance Company Ltd.

HDFC Standard Life Insurance Company Ltd. is one of India’s leading private

life insurance companies, which offers a range of individual and group

insurance solutions. It is a joint venture between Housing Development

Finance Corporation Limited (HDFC Ltd.), India’s leading housing finance

institution and The Standard Life Assurance Company, a leading provider of

financial services from the United Kingdom. Their cumulative premium

income, including the first year premiums and renewal premiums is Rs.

672.3 for the financial year, Apr-Nov 2005. They have managed to cover

over 11,00,000 individuals out of which over 3,40,000 lives have been

covered through our group business tie-ups.

2. HDFC Standard Life Insurance Company Ltd.

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Max New York Life Insurance Company Limited is a joint venture that brings

together two large forces - Max India Limited, a multi-business corporate,

together with New York Life International, a global expert in life insurance.

With their various Products and Riders, there are more than 400 product

combinations to choose from. They have a national presence with a network

of 57 offices in 37 cities across India.

3. HDFC Standard Life Insurance Company Ltd.

ICICI Prudential Life Insurance Company is a joint venture between ICICI

Bank, a premier financial powerhouse and prudential plc, a leading

international financial services group headquartered in the United Kingdom.

ICICI Prudential was amongst the first private sector insurance companies to

begin operations in December 2000 after receiving approval from

Insurance Regulatory Development Authority (IRDA). The company has a

network of about 56,000 advisors; as well as 7 banc assurance and 150

corporate agent tie-ups.

4.Kotak Mahindra Old Mutual Life Insurance Ltd.

Kotak Mahindra Old Mutual Life Insurance Ltd. is a joint venture between

Kotak Mahindra Bank Ltd. (KMBL), and Old Mutual plc.

5. Birla Sun Life Insurance Company

Birla Sun Life Insurance Company is a joint venture between Aditya

Birla Group and Sun Life financial Services of Canada.

o Tata AIG Life Insurance Company Ltd.

o SBI Life Insurance Company Limited

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o ING Vysya Life Insurance Company Private Limited

o Allianz Bajaj Life Insurance Company Ltd.

o Metlife India Insurance Company Pvt. Ltd.

o AMP SANMAR Assurance Company Ltd.

o Dabur CGU Life Insurance Company Pvt. Ltd.

1. Royal Sunderam alliance Insurance Company Ltd.

The joint venture bringing together Royal & Sun Alliance Insurance and

Sundaram Finance Limited started its operations from March 2001. The

company is Head Quartered at Chennai, and has two Regional Offices, one at

Mumbai and another one at New Delhi.

2. Bajaj Allianz General Insurance Company Limited

Bajaj Allianz General Insurance Company Limited is a joint venture between

Bajaj Auto Limited and Allianz AG of Germany. Both enjoy a reputation of

expertise, stability and strength.

Bajaj Allianz General Insurance received the Insurance Regulatory and

Development Authority (IRDA) certificate of Registration (R3) on May 2nd,

2001 to conduct General Insurance business (including Health Insurance

business) in India. The Company has an authorized and paid up capital of Rs

110 crores. Bajaj Auto holds 74% and the remaining 26% is held by Allianz,

AG, Germany.

3. ICICI Lombard General Insurance Company Limited

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ICICI Lombard General Insurance Company Limited is a joint venture

between ICICI Bank Limited and the US-based $ 26 billion Fairfax Financial

Holdings Limited. ICICI Bank is India's second largest bank, while Fairfax

Financial Holdings is a diversified financial corporate engaged in general

insurance, reinsurance, insurance claims management and investment

management.

Lombard Canada Ltd, a group company of Fairfax Financial Holdings Limited,

is one of Canada's oldest property and casualty insurers. ICICI Lombard

General Insurance Company received regulatory approvals to commence

general insurance business in August 2001.

4. Cholamandalam General Insurance Company Limited

Cholamandalam MS General Insurance Company Limited (Chola-MS) is a joint

venture of the Murugappa Group & Mitsui Sumitomo.

Chola-MS commenced operations in October 2002 and has issued more than

1.4 lakh policies in its first calendar year of operations. The company has a

pan-Indian presence with offices in Chennai, Hyderabad, Bangalore, Kochi,

Coimbatore, Mumbai, Pune, Indore, Ahmedabad, Delhi, Chandigarh, Kolkata

and Vizag.

5. Tata AIG General Insurance Company Ltd.

Tata AIG General Insurance Company Ltd. is a joint venture company,

formed from the Tata Group and American International Group, Inc. (AIG).

Tata AIG combines the strength and integrity of the Tata Group with AIG's

international expertise and financial strength. The Tata Group holds 74 per

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cent stake in the two insurance ventures while AIG holds the balance 26 per

cent stake.Tata AIG General Insurance Company, which started its

operations in India on January 22, 2001, offers the complete range of

insurance for automobile, home, personal accident, travel, energy, marine,

property and casualty, as well as several specialized financial lines.

6. Reliance General Insurance Company Limited.

7. IFFCO Tokio General Insurance Co. Ltd

8. Export Credit Guarantee Corporation Ltd.

9. HDFC-Chubb General Insurance Co. Ltd.

Marketing of Insurance In India

Insurance is in a manner of speaking the last frontier in the financial sector

to open. It is also a sector, which leads to benefits across the full spectrum,

from the individual who now have wider choices, to the economy, which see

increased savings, to the infrastructure sector, which can look forward to

long term funding being available. In an under-insured economy, newer

channels of distribution have to be utilized to intensify the reach of insurance

both in urban and rural markets. This will create huge employment

opportunities not only within insurance companies but also as agents and

consultants of insurance companies.

Market mix policies

Different companies can choose to position themselves differently and hence

the Marketing Mix is different. However, there are certain common

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characteristics that one can cull out from the possible strategies that

companies adopt.

o Product

The development of flexible products to suit individual requirements is what

will differentiate the winners from the also-rans. The key to success is in

providing insurance solutions, not standardized insurance products. The

concept of riders/optional benefits has already been a huge innovation

brought about by the new players, which has led to customization of

products for individual needs. However, companies may differentiate

themselves on the basis of product segments that they choose to focus on

and excel in.

o Place

Different companies may however choose different channels and different

geographies to focus on. The channel options are - tied agency force,

corporate agents and brokers and this is an area where different companies

will make different choices. Many companies like HDFC Standard Life are

focusing on all channels whereas companies like Max New York Life are

focusing on the tied agency force only. Customer interface will be a key

challenge for life insurance companies and includes every that interaction

that the customer has with the company, such as sales, new business

underwriting, policy servicing, premium payments, claim processing and so

on. Technology can play a crucial role in delivering the highest standards of

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service set by the company and it will be imperative for any serious player to

excel in all of these.

o Price

Price is a relevant differentiator only in two segments - pure term insurance

and in pure annuities. Here too, service delivery and financial strength will

need to be present at a minimum acceptable level for price to be a relevant

differentiator. In case of savings oriented products, long-term returns

generated are more relevant than just the price of the product. A focus on

generating good investment performance and keeping a tight control on

costs help in generating good long-term maturity value for customers. Norms

have been laid down on all of these by IRDA and adhering to these while

delivering good returns will be a challenge.

o Promotion and Advertising

The level of demand is latent and will have to be activated considerably. The

market needs to be developed. Greater awareness of insurance and the need

to have it as a protection tool rather than as a tax planning measure needs

to be appreciated by the Indian people. Various communication tools

including advertising, direct marketing and road shows contribute to all this

and different companies take different approaches on these.

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Chapter 2Company profileBoard membersCompany’s productsCorporate objective

Company profile

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HDFC Standard Life Insurance Company Ltd. is one of India's leading private insurance companies, which offers a range of individual and group insurance solutions. It is a joint venture between Housing Development Finance Corporation Limited (HDFC Ltd.), India's leading housing finance institution and a Group Company of the Standard Life, UK. HDFC as on December 31, 2007 holds 72.38 per cent of equity in the joint venture.

HDFC Standard Life Insurance Company Parentage

HDFC Limited.

o HDFC is India leading housing finance institution and has helped build more than   23, 00,000 houses since its incorporation in 1977.

o In Financial Year 2003-04 its assets under management crossed Rs. 36,000 Cr.

o As at March 31, 2004, outstanding deposits stood at Rs. 7,840 crores. The depositor   base now stands at around 1 million depositors.

o Rated AAA by CRISIL and ICRA for the 10th consecutive year

o Stable and experienced management

o High service standards

o Awarded The Economic Times Corporate Citizen of the year Award for its long-standing commitment to community development.

o Presented the Dream Homeâ award for the best housing finance provider in 2004 at   the third Annual Outlook Money Awards.

Standard Life Group

o Standard Life Group (Standard Life plc and its subsidiaries)

o The Standard Life group has been looking after the financial needs of customers for   over 180 years

o It currently has a customer base of around 7 million people who rely on the company   for their insurance, pension, investment, banking and health-care needs

o Its investment manager currently administers £125 billion in assets

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o t is a leading pensions provider in the UK, and is rated by Standard & Poor's as   'strong' with a rating of A+ and as 'good' with a rating of A1 by Moody's

o Standard Life was awarded the 'Best Pension Provider' in 2004, 2005 and 2006 at the Money Marketing Awards, and it was voted a 5 star life and pension’s provider at    the Financial Adviser Service Awards for the last 10 years running. The '5 Star'    accolade has also been awarded to Standard Life Investments for the last 10 years,    and to Standard Life Bank since its inception in 1998. Standard Life Bank was    awarded the 'Best Flexible Mortgage Lender' at the Mortgage Magazine Awards in    2006.

HDFC Key Strengths

o Financial expertise

As a joint venture of leading financial services groups, HDFC Standard Life Insurance has the financial expertise required to manage your long term investments safely and effectively.

o Range of solutions

The group has a range individual and group solutions, which can be easily customized to specific needs. The group solutions have been designed to offer the customer the complete flexibility combined with a low charging structure.

o Track record so far

The group gross premium income for the year end march 31, 2008 stood at Rs. 4,859 crores and new business premium income stood at 2,685 crores.

The company has covered over 9,59,000 lives year ending march 31, 2008.

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Board members

Brief Profile of the Board of Directors

Mr. Deepak S. Parekh is the Chairman of the Company. He is also the Executive Chairman of Housing Development Finance Corporation Limited (HDFC Limited). He joined HDFC Limited in a senior management position in 1978. He was inducted as a whole-time director of HDFC Limited in 1985 and was appointed as its Executive Chairman in 1993. He is the Chief Executive Officer of HDFC Limited. Mr. Parekh is a Fellow of the Institute of Chartered Accountants (England & Wales).

Sir Alexander M. Crombie joined the Board of Directors of the Company in April, 2002. He has been with the Standard Life Group for 34 years holding various senior management positions. He was appointed as the Group Chief Executive of the Standard Life Group in March 2004. Sir Crombie is a fellow of the Faculty of Actuaries in Scotland.

Mr. Keki M. Mistry joined the Board of Directors of the Company in December, 2000. He is currently the Managing Director of HDFC Limited. He joined HDFC Limited in 1981 and became an Executive Director in 1993. He was appointed as its Managing Director in November, 2000. Mr. Mistry is a Fellow of the Institute of Chartered Accountants of India and a member of the Michigan Association of Certified Public Accountants.

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Ms. Marcia D. Campbell is currently the Group Operations Director in the Standard Life group and is responsible for Group Operations, Asia Pacific Development, Strategy & Planning, Corporate Responsibility and Shared Services Centre. Ms. Campbell joined the Board of Directors in November 2005.

Ms. Renu S. Karnad is the Executive director of HDFC Limited, is a graduate in law and holds a Master's degree in economics from Delhi University. She has been employed with HDFC Limited since 1978 and was appointed as the Executive Director in 2000. She is responsible for overseeing all aspects of lending operations of HDFC Limited.

Mr. Norman K. Skeoch is currently the Chief Executive in Standard Life Investments Limited and is responsible for overseeing Investment Process & Chief Executive Officer Function. Prior to this, Mr. Skeoch was working with M/s. James Capel & Co. holding the positions of UK Economist, Chief Economist, Executive Director, Director of Controls and Strategy HSBS Securities and Managing Director International Equities. He was also responsible for Economic and Investment Strategy research produced on a worldwide basis. Mr. Skeoch joined the Board of Directors in November 2005.

Mr. Gautam R. Divan is a practising Chartered Accountant and is a Fellow of the Institute of Chartered Accountants of India. Mr. Divan was the Former Chairman and Managing Committee Member of Midsnell Group International, an International Association of Independent Accounting Firms and has authored several papers of professional interest. Mr. Divan has wide experience in auditing accounts of large public limited companies and nationalised banks, financial and taxation planning of individuals and limited companies and also has substantial experience in structuring overseas investments to and from India.

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Mr. Ranjan Pant is a global Management Consultant advising CEO/Boards on Strategy and Change Management. Mr. Pant, until 2002 was a Partner & Vice-President at Bain & Company, Inc., Boston, where he led the worldwide Utility Practice. He was also Director, Corporate Business Development at General Electric headquarters in Fairfield, USA. Mr. Pant has an MBA from The Wharton School and BE (Honours) from Birla Institute of Technology and Sciences.

Mr. Ravi Narain is the Managing Director & CEO of National Stock Exchange of India Limited. Mr. Ravi Narain was a member of the core team to set-up the Securities & Exchange Board of India (SEBI) and is also associated with various committees of SEBI and the Reserve Bank of India (RBI).

Mr. Gerald E. Grimstone was appointed Chairman in May 2007, having been Deputy Chairman since March 2006. He became a director of The Standard Life Assurance Company in July 2003. He is also Chairman of Candover Investments plc and was appointed as one of the UK’s Business Ambassadors by the Prime Minister in January 2009. Gerry held senior positions within the Department of Health and Social Security and HM Treasury until 1986. He then spent 13 years with Schroders in London, Hong Kong and New York, and was Vice Chairman of Schroders’ worldwide investment banking activities from 1998 to 1999. He is the Alternate Director to Sir Alexander Crombie.

Mr. Paresh Parasnis is the Principal Officer and Executive Director of the company since November 14, 2008. A fellow of the Institute of Chartered Accountants of India, he has been associated with the HDFC Group since 1984. During his 16-year tenure at HDFC Limited, he was responsible for driving and spearheading several key initiatives. As one of the founding members of HDFC Standard life, Mr. Parasnis has been responsible for setting up branches, driving sales and servicing strategy, leading

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recruitment, contributing to product launches and performance management system, overseeing new business and claims settlement, customer interactions etc.

Company Products

Individual Products

We at HDFC Standard Life realize that not everyone has the same kind of

needs. Keeping this in mind, we have a varied range of Products that you can

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choose from to suit all your needs. These will help secure your future as well

as the future of your family.

Protection Planso HDFC Term Assurance Plano HDFC Loan Cover Term Assurance Plano HDFC Home Loan Protection Plan

You can protect your family against the loss of your income or the burden of a loan in the event of your unfortunate demise, disability or sickness. These plans offer valuable peace of mind at a small price.Our Protection range includes our Term Assurance Plan & Loan Cover Term Assurance Plan

Savings & Investment Plans

o HDFC Unit Linked Endowment Plus IIo HDFC SimpliLifeo HDFC Unit Linked Endowment IIo HDFC Unit Linked Enhanced Life Protection IIo HDFC Unit Linked Wealth Maximiser Pluso HDFC Unit Linked Endowment Winnero HDFC Endowment Assurance Plano HDFC Money Back Plano HDFC Single Premium Whole of Life Insurance Plano HDFC Assurance Plano HDFC Savings Assurance Plan

Our Savings Plans offer you flexible options to build savings for your future needs such as buying a dream home or fulfilling your children immediate and future needs.

Our Savings range includes Endowment Assurance Plan, Unit Linked Endowment, Unit Linked Endowment Plus, Unit Linked Endowment Plus II, Money Back, Unit Linked Enhanced Life Protection II, Children's Plan, Unit Linked Young Star, Unit Linked Young Star Plus, Unit Linked Young Star Plus II.

Children's Plans

o HDFC Children's Plano HDFC Unit Linked Young Star II

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o HDFC Unit Linked Young Star Plus IIo HDFC Unit Linked YoungStar Champion

Retirement Plans

o HDFC Personal Pension Plano HDFC Unit Linked Pension IIo HDFC Unit Linked Pension Maximiser IIo HDFC Immediate Annuity

Health Plans

o HDFC Critical Care Plano HDFC SurgiCare Plan

Group Plans

o Group Term Insurance Plano Group Variable Term Insurance Plano Group Unit Linked Plan - Gratuityo Group Unit Linked Plan - Superannuationo Group Unit Linked Plan - Leave Encashment

Development Insurance Plan

Development Insurance plan is an insurance plan which provides life cover to members of a Development Agency for a term of one year. On the death of any member of the group insured during the year of cover, a lump sum is paid to those member beneficiaries to help meet some of the immediate financial needs following their loss.

Eligibility

Members of the development agency and their spouses with :

- Minimum age at the start of the policy 18 years last birthday

- Maximum age at the start of policy 50 years last birthday

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Employees of the Development Agency are not eligible to join the group. The group to be covered is only eligible if it contains more than 500 members.

Premium Payments

The premium to be paid will be quoted per member in the group and will be the same for all members of the group. The premium can only be paid by the Development Agency as a single lump sum that includes all premiums for the group to be covered. Cover will not start until the premium and all the member information in our specified format has been received.

The premium rate is Rs. 25 per Rs. 10,000 of lump sum, per member.

Benefits

On the death of each member covered by the policy during the year of cover a lump sum equal to the sum assured will be paid to their beneficiaries or legal heirs. Where the death is as a result of an accident, an additional lump sum will be paid equal to half the sum assured. There are no benefits paid at the end of the year of cover and there is no surrender value available at any time.

The role of the Development Agency

Due to the nature of the groups covered, HDFC Standard Life will be passing certain administrative tasks onto the Development Agency. By passing on these tasks the premium charged can be lower. These tasks would include:

Submission of member data in a specified computer format

Collection of premiums from group members

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Recording changes in the details of group members

Disbursement of claim payments and the mortality rebate (if any) to group members

These tasks would be in addition to the usual duties of a policyholder such as:

Payment of premiums

Reporting of claims

Keeping policy holder information up to date

Training and support will be available to give guidance on how to complete the tasks appropriately. Since these additional tasks will impose a burden on the Development Agency, the Development Agency may charge a Rs. 10 administration fee to their members.

Prohibition of rebates

Section 41 of the Insurance Act, 1938 states

No person shall allow or offer to allow, either directly or indirectly, as an inducement to any person to take out or renew or continue an insurance in respect of any kind of risk relating to lives or property in India, any rebate of the whole or part of the commission payable or any rebate of the premium shown on the policy, nor shall any person taking out or renewing or continuing a policy accept any rebate, except such rebate as may be allowed in accordance with the published prospectus or tables of the insurerIf any person fails to comply with sub regulation (previous point) above, he shall be liable to payment of a fine which may extend to rupees five hundred

Tax Benefits

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INCOME TAX SECTION GROSS ANNUAL

SALARY

HOW MUCH TAX CAN YOU SAVE? HDFC STANDARD LIFE

PLANS

Sec. 80C Across All income Slabs Upto Rs. 33,990 saved on investment of

Rs. 1,00,000.

All the life insurance plans.

Sec. 80 CCC Across all income

slabs.

Upto Rs. 33,990 saved on

Investment of Rs.1,00,000.

All the pension plans.

Sec. 80 D* Across all income

slabs

Upto Rs. 3,399 saved on

Investment of

Rs. 10,000.

All the health insurance

riders available with the

conventional plans.

TOTAL SAVINGS

POSSIBLE ** Rs37,389

Rs. 33,990 under Sec. 80C and under Sec. 80 CCC , Rs.3,399 under Sec. 80 D, calculated for a male with gross annual income

exceeding Rs. 10,00,000.

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

the conditions laid down therein.

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CORPORATE

OBJECTIVE

Our Vision

'The most successful and admired life insurance company, which means that we are the most trusted company, the easiest to deal with, offer the best value for money, and set the standards in the industry'.'The most obvious choice for all'.

Our Values

Values that we observe while we work:

.Integrity

.Innovation

.Customer centric

.People Care One for all and all for ones€ �

.Teamwork

.Joy and Simplicity

Accolades and Recognition

Rated by 'Business world' as 'India's Most Respected Private Life Insurance Company in 2004.

33

Chapter 3 Research methodology

Objective & Significance Research Design Data Collection

34

Research methodology

Research studies the behavior of human beings as members of society and

their feelings responses, attitudes under different circumstances. The

study is to

determine customer-buying behavior with a focus on market

segmentation

for HDFC Standard Life Insurance.

Title Justification

The above title is self explanatory. The study deals mainly with studying the

buying pattern in the insurance industry with a special focus on HDFC

Standard Life Insurance. The various segments of the markets divided in

35

terms of Insurance Needs, Age groups, Satisfaction levels etc will also

studied.

Area of research

The area of research was Bhopal Madhya Pradesh. The samples of the

respondents of have been taken from the different locations of the city. The

data analysis has been done on the basis of the responses of the

respondents.

RESEARCH DESIGN

o NON-PROBABILITY

oEXPLORATORY & DISCRIPTIVE EXPERIMENTAL RESEARCH

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

The sources of information are both primary & secondary.

A well-structured questionnaire was prepared and personal interviews were

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

through this questionnaire.

Sampling Methodology

Area of sampling

The area of sampling was the different regions of the Bhopal.

36

Sampling Technique

Initially, a rough draft was prepared keeping in mind the objective of the

research. A pilot study was done in order to know the accuracy of the

Questionnaire. The final Questionnaire was arrived only after certain

important changes were done. Thus my sampling came out to be

judgmental and continent

Sampling Unit

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

units. These comprise of employees of MNCs, Govt. Employees and

Self-employed etc.

Sample size

The sample size was restricted to about 100, which comprised of mainly

peoples from different regions of Bhopal due to time constraints.

Objectives

o To determine reasons behind opting for an insurance.

o To provide the company with information of customer's Insurance policy if

they have any and reasons for opting for that particular policies.

o To know the most preferred policy.

o To determine customers perception towards private insurance companies

and their expectation form private insurance companies.

37

o To determine the feedback on services provided by any other insurance

agent.

o To study the types of benefits provided by insurance services.

o To determine the use of Internet for valuable information and decision-

making process.

DATA COLLECTION

Primary data:

The data has been collected through the observation method &

direct communication with the respondents during this descriptive

research. The other methods have also been used to obtain the

primary data such as:

1. Interview method

2. Questioners method

3. Schedules method

The schedules methods were very useful to collect the data

through questioners. The role of enumerator was very important

who were appointed for the purpose . The enumerators went to the

respondents along with the profarma (profarma contains a set of

38

questions) & these profarma’s has been filled by the sampled

respondents to obtain the require data.

Secondary data

There are a lot of sources of secondary data collation. The source

of internet has been used in a large scale to collect the data about

the company’s profit & loss statements, balance sheets, sales

fingers, sales call records etc.

Other data has been collected by the theatrical expose which is

given by the trainer during the training.

Chapter 4

Facts & Findings

39

Data analysis & Interpretation

Facts & Findings

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

tax saving device. They are aware of the fact & realizing its,

importance. The company should try to expand & build up its

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

2. Company should come up with its branch in Bhopal. With the objective

and goals to meet the demands & expectations of the public. Because the

40

entrance of private players will increase the competition and it would be a

tough task to secure a good position in market.

3.Since HDFC STANDARD LIFE INSURANCE LTD is leading with several

companies’ policies it should be easy for them to penetrate into the

market and secure a good position if they pay greater attention to the

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

trusted relationship.

4. As seen from the survey that at present 70% of the customer are

having insurance policy out of which 87.5% of the customer are planning

for new investments. So it can be a good potential for the company and

they should make an attempt to trap these customers.

5. Above 43% of the customer is even ready to go for insurance if a service provider away from their home is providing it. But intend they should provide good products and services. The company should try to convince these customers and get them in its favor.

Data analysis & Interpretation

o DATA GIVES PREFERENCE OF RESPONDENTS OF INSURANCE COMPANIES

41

COMPANY’S NAME NO.OF RESPONDENT SHARE (%)

L.I.C. 78 78

HDFC 2 2

ICICI PRUDENTIAL 10 10

SBI LIFE 7 7

RELIANCE LIFE INSURANCE 3 3

TOTAL 100 100

Interpretation

o 78% of the people contacted prefer LIC policy to any other and therefore

it is ranked no.1 by that percent of respondents.

o DATA GIVES BENEFITS OF INSURANCE PERCEIVED BY

RESPONDENTS

42

BENEFITSNO.OF

RESPONDENTS

SHARE (%)

Cover Future Uncertainty

55 55

Tax Deductions 20 20

Future Investment 25 25

TOTAL 100 100

Interpretation

o 55% of the respondents believe that covering future uncertainty is

the biggest benefit of an insurance policy.

o Whereas, 20% and 25% of them believe that the other benefits

are Tax deduction and future investments respectively

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o DATA PROVIDES FEATURES OF INSURANCE

POLICY THAT ATTRACTED RESPONDENTS

FEATURE NO.OF RESPONDENT

S

SHARE (%)

Money Back Guarantee 15 15

Larger Risk Coverance 37 37

Easy Access to Agents 7 7

Low Premium 30 30

Company’s Reputation 11 11

TOTAL 100 100

Interpretation

44

o Majority of the respondent (37%) found Larger risk coverance as the

most attracted feature of the all.

o DATA PROVIDES NUMBER OF INSURANCE POLICY

TYPE RESPONDENTS

POLICY TYPE NO. OF RESPONDENT

S

SHARE (%)

LIFE POLICY 75 75

NON LIFE POLICY 25 25

BOTH 45 45

Interpretation

45

o 75% of the respondents have Life Insurance Policy while 45% have

both. (The % is calculated out of 280 positive response)

o DATA GIVES PEOPLE PERCEPTION ABOUT INSURANCE

RESPONSE NO. OF RESPONDENTS

SHARE (%)

A saving tool 81 81%

A tax saving device 74 74%

A tool to protect your family 100 100%

Interpretation

o 81% of the respondents have perception of Insurance being a saving tool.

46

o And 74% of the respondents have perception of Insurance being a tax saving

device.

o But 100% of the respondents are with the view that Insurance is a tool to

protect your family.

o DATA SHOWS PEOPLE HAVING INSURANCE

RESPONSE NO. OF RESPONDENTS

SHARE (%)

Yes 70 70%

No 30 30%

Interpretation

o Of the sample size of 400 surveyed respondents 70% of the respondents are

having Insurance policy.

47

o 30% of the respondents are either not having any Insurance policy at present or their

policy is already matured.

o And at present 100% of the respondents are with the view that Insurance is a tool to

protect your family.

o DATA SHOWS BUYING PROCESS OF THE

PEOPLE

BUYING PROCESS NO. OF RESPONDEN

TS

SHARE (%)

Customer approached Insurance company/Agent

45 45%

Company/agent approached customer

55 555

Total 100 100%

48

Interpretation

o 44.5% of the respondents approached the Insurance Company / Agent.

o Whereas, 55.5% of the respondents were approached by the

Company /Agent.

o DATA SHOWS REASONS BEHIND FOR

INSURANCE

RESPONSE NO. OF RESPONDENT

S

SHARE (%)

Tax saving 80 80%

49

Saving / Investment 80 80.%

Family protection 100 100%

Interpretation

o 80.71% of the Respondents opted for Insurance for tax saving benefits.

o 80.71% of the Respondents opted for saving / Investments.

o But all of them, i.e. 100% of the respondents have opted for insurance

for their family protection.

o DATA SHOWS SATISFACTION OF RESPONDENTS WITH RESPECT TO POLICY

RESPONSE NO. OF SHARE (%)

50

RESPONDENTS

Satisfied 60 60%

Not satisfied 40 40%

Not Responded 0 0.0%

Total 100 100%

Interpretation

o 60% of the respondents are more or less satisfied with their existing policy.

o 40% of the respondents are not satisfied with their existing policy.

o In this case all of those who have taken a policy have responded.

51

o DATA SHOWS SATISFACTION OF +RESPONDENTS WITH RESPECT TO

SERVICE AGENT

RESPONSE NO. OF RESPONDENTS

SHARE (%)

Satisfied 45 45%

Not satisfied 55 55%

Not Responded 0 0.0%

Total 100 100%

Interpretation

o 45% of the respondents are satisfied with their existing service agent.

o 55% of the respondents are not satisfied with their existing insurance

agent.

52

o All of those who have taken a policy have responded.

o DATA SHOWS NUMBER OF RESPONDENTS

PAYING TAX

RESPONSE NO. OF RESPONDENTS

SHARE (%)

Paying tax 100 100%

Not paying tax - 0%

Total 100 100%

Interpretation

o Of the sample size of 100 respondents, all the respondents are paying tax

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o DATA SHOWS RESPONDENT’S INVESTMENTS FOR TAX SAVING

INVESTMENTS NO. OF RESPONDENTS

SHARE (%)

LIC 51 51%

NSC 33 33%

Bonds 32 32%

PPF 25 25%

PF 21 21%

EPF 11 11%

Interpretation

54

o 51% of the respondents save their tax by investing in LIC, which is the

highest among all Investment. This shows that most people for getting

taxes benefits invest in LIC.

o 33.25% of the respondents do their tax saving by investing in NSC.

o 32.25% of the respondents to their tax saving by investing in bonds.

o DATA SHOWS RESPONDENTS PERCEPTION ABOUT BEST FORM

OF INVESTMENT FOR SECURING THEIR FUTURE

NO. OF RESPONDENTS

SHARE (%)

Fixed Assets 75 75%

Bank deposits 11 11%

Jewellery 25 25%

Securities i.e. bonds, MFs 40. 40%

Shares 10 10%

Insurance 70 70%

55

Interpretation

o 75.25% of the respondents as with the view that Fixed Assets is the best

form of investment for securing their future.

o 70.5% of the respondents are with the perception that Insurance is the

best form of investment for securing their future, which is one of the

highest and this shows that insurance is an important key for securing

your future.

o DATA SHOWS WHAT PEOPLE INTENT TO GAIN FROM

THEIR INVESTMENT

RESPONSE NO. OF RESPONDEN

TS

SHARE (%)

Saving & Returns 100 100%

Security 90 90%

Tax benefits 71. 71.%

56

Interpretation

o 100% of the respondents intent to gain saving and returns from their

investment.

o 90% of the respondent’s intent to gain security from their

investments.

o Whereas, 71.75% of the respondent’s intent to gain tax benefits from

their investments.

o DATA GIVES PEOPLE’S PERCEPTION ON APPROPRIATE

AGE FOR BUYING INSURANCE

RESPONSE NO. OF RESPONDENTS SHARE (%)

57

After 25 years 29 29%

After 35 years 10 10%

After 45 years 0 0%

Anytime 60 60%

Interpretation

o 29% of the respondents are with the view that insurance should be bought after the

age of 25 years.

o 10.5% of the respondents are with the view that insurance should be buyed after

the age of 35 years.

oWhereas, 60.5% of the respondents are with the view that buying of insurance do

not have any thing to do with age i.e. there is no age limitations. It can be

purchased any time according to the need.

58

o DATA SHOWS PEOPLE OPINION ABOUT INDIAN INSURANCE COMPANIES

RESPONSE NO. OF RESPONDENTS SHARE (%)

Rigid plans 67 67%

Non user friendly 29 29%

Unsatisfactory services 26 26%

Non Aggressive 35 35%

Satisfactory 24 24%

Good 10 10%

Very good 0 0%

Interpretation

o 67% of the respondents have the opinion that Indian Insurance

Companies have Rigid plans.

o 29.5% feel that Indian Insurance companies are Non-user friendly.

o 26.5% feel that services of Indian Insurance companies are

Unsatisfactory.

o 35.75% of the respondents are with the view that Indian Insurance

companies are Non-aggressive.

o 24% of the respondents feel that products and services of Indian

Insurance companies is Satisfactory.

59

o Whereas only 10.25% feel that it is Good enough.

o And according to the data, no single person has felt that it is very good.

o DATA SHOWS WHAT PEOPLE WOULD LOOK FOR IN AN INSURANCE

COMPANY

RESPONSE NO. OF RESPONDEN

TS

SHARE (%)

A trusted name 82 82%

Friendly service & responsiveness

71 71%

Good plans 81 81%

Accessibility 49 49%

Interpretation

o 82% customers look for a Trusted name in a company for insurance.

60

o 81.5% customers look for a good plan in a company for insurance.

o Friendly service & responsiveness and Accessibility are also important

factors looked by customers in a company.

o DATA SHOWS PEOPLE PLANNING FOR NEW

INVESTMENTS

RESPONSE NO. OF RESPONDENTS

SHARE (%)

Planning 87 87%

Not planning 13 13%

Total 100 100%

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Interpretation

o Only 12.5% of the customers contacted are not planning for new

investments presently.

o Whereas, 87.5% of the customers are still planning for new investments this can be a great potential for Reliance Life Insurance to take them on their favor

o DATA SHOWS PEOPLE INTERESTED IN GOING FOR

INSURANCE IF A SERVICE PROVIDER AWAY FROM THE

CITY OFFERS BETTER SERVICE & PRODUCTS

62

RESPONSE NO. OF RESPONDEN

TS

SHARE (%)

Yes 43 43%

No 44 44%

Uncertain 13 13%

Total 100 100%

Interpretation

o The interested customers i.e. 43% are ready to go for insurance even

away from a city if services and products are worthwhile, which again

is a good prospect (potential) for Reliance Life Insurance to take them

on their favor.

Chapter 5

Conclusion

Limitation

Suggestion

63

Conclusion

Our exhaustive research in the field of Life Insurance threw up some

interesting trends which can be seen in the above analysis. A general

impression that we gathered during Data collection was the immense

awareness and knowledge among people about various companies and

their insurance products. People are beginning to look beyond LIC for their

insurance needs and are willing to trust private players with their hard

earned money.

People in general have been impressed by the marketing and advertising

campaigns of insurance companies. A high penetration of print, radio and

Television ad campaigns over the years is beginning to have its impact

now.

64

Another heartening trend was in terms of people viewing insurance as a tax

saving and investment instrument as much as a protective one. A very high

number of respondents have opted for insurance for such purposes and it

shows how insurance companies have been successful to attract public

money in recent times.

The general satisfaction levels among public with regards to policy and

agents still requires improvement. But therein lies the opportunity for a

relative new comer like HDFC Standard Life Insurance Company Ltd . LIC

has never been known for prompt service or customer oriented methods

and HDFC Standard Life can build on these factors.

Limitations

o Some respondents were reluctant to divulge personal information which

can affect the validity of all responses.

O In a rapidly changing industry, analysis on one day or in one segment can

change very quickly. The environmental changes are vital to be

considered in order to assimilate the findings.

65

O This study is confined to Bhopal city therefore the result should not be

generalized.

o Sample size is very small it might not covering whole population.

o The primary & secondary data are limited and are consstrained by the

availability and approachability.

Recommendations

o The company should expand its branches in small cities or suburban areas because a big part of india’s population lives in small places.

o As the people think that insurance is a tool to protect their family & a tax

saving device. They are aware of the fact & realizing its, importance. The

66

company should try to expand & build up its infrastructure because there is

a large potential for insurance in India.

o Company should come up with its branch in Bhopal. With the objective and

goals to meet the demands & expectations of the public. Because the

entrance of private players will increase the competition and it would be a

tough task to secure a good position in market.

o Since HDFC Standard Life Insurance Company Ltd is leading with several

companies’ policies it should be easy for them to penetrate into the market

and secure a good position if they pay greater attention to the service part

provided to their customer and thereby forming a long and trusted

relationship.

o As seen from the survey that at present 70% of the customer are having

insurance policy out of which 87.5% of the customer are planning for new

investments. So it can be a good potential for the company and they should

make an attempt to trap these customers.

o 43% of the customer is even ready to go for insurance if a service provider

away from their home is providing it. But intend they should provide good

products and services. The company should try to convince these

customers and get them in its favor.

67

Chapter 6

Appendix

68

Bibliography

1. Books/Magazines referred

o Books published by insurance institute of India

o Insurance watch.

o Money outlook.

2. Websites referred

o WWW .Cifainsurance .com

o WWW .Moneyoutlook.com

o WWW .Iinsurance.Ind.com

o WWW.HDFCinsurance.com

3.Reports/Articles referred

o Report: Issues and challenges facing the insurance.

o Brief profile of LIC India…Dec 2006.

69

Questionares1.Are you employed?

Yes No

If yes, only then proceed

2.Do you have any Insurance Policy? Yes No

3.Which insurance policy do you have?

Life Non-life Both

4.Which co’s insurance policy you prefer the most? (rank them)

a) LIC b) ICICIPRUDENTIAL c) SBI LIFE INSURANCE d) ING VYSYA LIFE e) RELIANCE LIFE INSURANCE

f) TATA AIG LIFE g) ANY OTHER ________( Specify) 5. For how many years do you have insurance policy? (Please Tick)

a) <5Yrs b) 5-10 Yrs c) 10-15 Yrs d) Any Other______(Specify)

6. What do you think are the benefits of insurance cover?(rank them)

a) Cover future uncertainty b) Tax deductions

c) Future investment

d) Any other _________ (Specify)

7. Which feature of your policy attracts you to buy it ? (Rank them) a) Low premium

70

b) Larger risk coverage c) Money back guarantee d) Reputation of company e) Easy access to agent f) Any other _________ (Specify)

8. Your monthly income?

a)<4k b)4k-8k c)8k-12k d)12k-16k e)Other_____(Specify) 9. Do you really think insurance policy cove in today’s scenario is not essential?

a) yes b) No c) No responce

10. What’s your perception about insurance? (Rank them)

a) A saving tool

b) A tax saving device c) A tool of protect future

11. How has/would you bought/buy insurance?

a) Customer approach insurance co’s

b) Insurance co’s approach customer 12. Are you satisfied with the policies?

a) Satisfied saving tool

b) Not satisfied c) Not responding

13. Are you satisfied with the service agent?

71

a) Satisfied saving tool

b) Not satisfied c) Not responding

14 Do you pay tax?

Yes No

15. Where have you invested for tax saving? (Rank them)

a) LIC

b) NSC

c) Bonds

d) PPF

e) PF

f) EPF

16. Which is the best form of investment? (Rank them)

a) Fixed assets

b) Bank deposits

c) Jewellery

d) Securities, i.e. Bonds, MFs

e) Shares

72

f) Insurance

17. What do you intend to gain from investment?

a) Savings & returns

b) Security c) Tax benefits

18. What’s the right age to buy the insurance?

a) After 25 yrs

b) After 35 yrs c) After 45 yrs

d) Any time

19. How would you rate Indian insurance co’s?

a) Rigid plans

b) Non-user friendly

c) Unsatisfactory services

d) Non-aggressive

e) Satisfactory f) Good

g) Very good

20. What would you look for in an insurance company?

(Rank them)

73

a) A trusted name

b) Friendly service & responsiveness c) Good plans

d) Accessibility

21. Are you planning for new investment?

Planning Not planning

22. Would you go for insurance if a service provider away from the city offers better service & products?

a) Yes

b) No

c) Uncertain

74

Thank you

Name:_________________________

Address:______________________

______________________________

Occupation:___________________

Contract no.:___________________

75