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INTRODUCTION

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INTRODUCTION

Life Insurance Corporation of India till few years ago used to enjoy a complete

monopoly in the life insurance sector of the country. Because of the monopoly it used

to offer the consumers its products at unjustifiable rates and the services were also not

up to the mark.

But because of the changes which were and are being brought about in the Insurance

Act the life insurance sector has seen the emergence of many private players. With the

emergence of these private players the Life Insurance Corporation of India is facing a

stiff competition from them not only in terms of price but also in terms of the services

provided.

The big question which arises is that will the old horse be able to survive the

competition or will the new players emerge victorious. How will these players

differentiate their products? Will these private players be able to survive in the future

or is it just a temporary phase of flooding of the Indian life insurance market with

products in quantity and not in quality? What are the prospects of these private

players in the insurance market in future and how much impact they have created on

Indian consumer?

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CONCEPTUAL

FRAMEWORK

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WHAT IS LIFE INSURANCE ?

Life Insurance is a contract for payment of a sum of money to the person assured (or

failing him/her, to the person entitled to receive the same) on the happening of the

event insured against.

Usually the insurance contract provides for the payment of an amount on the date of

maturity or at specified dates at periodic intervals or at unfortunate death if it occurs

earlier. Obviously, there is a price to be paid for this benefit. Among other things, the

contract also provides for the payment of premiums by the assured. Life Insurance is

universally acknowledged as a tool to eliminate risk, substitute certainty for

uncertainty and ensure timely aid of the family in the unfortunate event of the death of

the breadwinner. In other words, it is the civilized world's partial solution to the

problems caused by death. (1)

In a nutshell, life insurance helps in two ways: premature death, which leaves

dependent families to fend for itself and old age without visible means of support.

Any person who has attained majority and is eligible to enter into a valid contract can

take out a life insurance policy for himself / herself. Policies can also be taken out,

subject to certain conditions, on the life of ones children.

The need for life insurance will change as you grow older. When you are young, you

may believe you have no need for life insurance. But as you grow older, possibly get

married and take on more responsibilities, your desire to take out an insurance policy

increases.

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What is the reach and significance of Life Insurance as an economic activity?

So long as the maintenance of a family depends on the earning power of the

bread-winner.

So long as the earning can be destroyed by death, old age or disability.

Just so long life as insurance continues to be the keystone of the individual and

those who are dependent on him.(2)

Thus, life insurance is universal and will play a useful role as long as the family set up

survives. Life Insurance caters to an important social need.

NEED FOR LIFE INSURANCE

The need for life insurance comes from the need to safeguard our family. If you care

for your familys needs you will definitely consider insurance. Today insurance has

become even more important due to the disintegration of the prevalent joint family

system, a system in which a number of generations co-existed in harmony, a system in

which a sense of financial security was always there as there were more earning

members. Times have changed and the nuclear family has emerged. Therefore you

need to save a part of income for the future too.

This is where insurance helps us.

Factors such as fewer numbers of earning members, stress, pollution, increased

competition, higher ambitions etc are some of the reasons why insurance has gained

importance and where insurance plays a successful role.

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Insurance provides a sense of security to the income earner as also to the family.

Buying insurance frees the individual from unnecessary financial burden that can

otherwise make him spend sleepless nights. The individual has a sense of consolation

that he has something to fall back on.

From the very beginning of your life, to your retirement age insurance can take care

of all your needs. Your child needs good education to mould him into a good citizen.

After his schooling he need to go for higher studies, to gain a professional edge over

the others - anecessity in this age where cut-throat competition is the rule. His career

needs have to be fulfilled.

Insurance is a must also because of the uncertain future adversities of life. Accidents,

illnesses, disability etc are facts of life which can be extremely devastating. Disability

can be taken care of by insurance. Your family will not have to go through the grind

due to your present inability.

Moreover, retirement, an age when every individual has almost fulfilled his

responsibilities and looks forward to relaxing can be painful if not planned properly.

Have we considered the increasing inflation and taxes? Will our investment offer us

attractive returns under such circumstances? Will it take care of our family after us?

An insurance policy will definitely take care of these and a lot more. Insurance has

become a necessity today. It provides timely financial as also rewards with bonuses.

Life Insurance has come a long way from the earlier days when it was originally

conceived as a risk covering medium for short periods of time, covering temporary

risk situations, such as sea voyages.

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Therefore after going through the discussion let us summarize our points and

understand the need of life insurance:

a) Temporary needs / threats

The original purpose of life insurance remains an important element, namely

providing for replacement of income on death etc.

b) Regular Savings / Family Protection

Providing for one's family and oneself, as a medium to long term exercise (through a

series of regular payment of premiums). This has become more relevant in recent

times as people seek financial independence for their family.

c) Investment

Put simply, the building up of savings while safeguarding it from the ravages of

inflation. Unlike regular saving products, investment products are traditionally lump

sum investments, where the individual makes a one off payment.

d)Old age provision

Provision for later years becomes increasingly necessary, especially in a changing

cultural and social environment. One can buy a suitable insurance policy, which will

provide periodical payments in one's old age.

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e) Children benefit

Provision for the education, marriage and start in life for the children.

f) Special needs provision

Protection against loss arising out of accident, disability, sickness, loan repayment on

death.

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WHY IS INSURANCE SUPERIOR TO OTHER FORM OF

SAVINGS?

An immediate estate is created in favor of the policy holder.

Protection in case of death.

Liquidity in case of need easy loans are available .

Tax relief income tax, wealth tax etc..

Policies can be offered as collateral security.

Policies can be taken under M.W.P. Act 1874, to protect against creditors.

Let us take an example to understand the need for insurance:

Mr. Atul is 45 and self-employed. His wife Nandini, who is a housewife, looks after

their two children aged 3 and 7 years. They stay in a rented accommodation, where

the rent is 15,000 rupees per month. Mr. Atul has taken up a loan of Rs. 2 lakh. His

monthly earnings on average are 40,000 rupees. Mr. Atul passes away in an

unfortunate road accident. What are some of the financial implications of his death on

his family.

There may be several financial implications on his family. Some of these are:

a) The monthly income, previously provided by Mr. Atul would stop.

b) His wife and children may have to seek financial assistance from other relatives.

c) His wife may not have enough money to pay back the loan of Rs. 2 lakhs.

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d) The family may have to move into a cheaper accommodation.

e) His widow may have to take up work to earn money.

f) The education of his children may suffer.

This simple example illustrates the impact premature death can have on a family,

where the main earner has no life cover.

Had Mr. Atul taken life cover, his family would not have faced such hardships in the

event of his unfortunate death. A simple life insurance policy could have provided

Mr. Atul's family with a lump sum that could have been invested to provide an

income equal to all or part of his income.

In simple words, insurance protects against untimely losses. Insurance has been found

useful in the lives of persons both in the short term and long term. Short term needs

like sudden medical costs and long term needs like marriage expenses etc can be met

with using life insurance.

TYPES OF INSURANCE POLICIES

Though there are a lot of policies available in the market under different names and

by different companies, the policies can broadly be classified into the following

categories:

Term Insurance Policy

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Whole Life Policy

Money Back Policy

Endowment Policy

Pension Plans Or Annuities

TERM INSURANCE POLICY

Term insurance provides life insurance coverage for a specific period of time.

Presently one year, five year, ten year, and fifteen year, are the periods one can buy

term life insurance policy. If the insured person dies during the period the insurance is

in force, the insurance company pays off the face value of the policy. If the insured

lives longer than the term of the policy, the policy is no longer in effect and nothing is

paid.

Term insurance is the least expensive form of life insurance. It is commonly used

when the insured needs temporary protection or cant afford the premiums for the

other forms of life insurance. The other reason an insured may want term insurance is

to purchase life insurance and invest the difference between the term policy and cash

value policy elsewhere.

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Term insurance comes in several forms. There is renewable & non renewable. Non

renewable means that on the expiry of your policy you must go under another

physical test and filling out another questionnaire. On the other hand, with renewable

policy you dont need to undergo these formalities again and you automatically re

qualify to continue your policy.

Then there is convertible & non convertible policy. Convertible policy is the one

which can be converted into a permanent policy, whereas non convertible is the one

which cannot be converted into a permanent policy or in other words the policy

cannot be converted to any other form of life insurance policy.

WHOLE LIFE POLICY

The whole life policy provides insurance coverage for the entire life of the insured

regardless of how many years the insurance is paid. Premiums may be paid

throughout the insureds entire life or for a portion of his life. Additionally, the

premium can be paid in one lump sum when the policy is taken out. This is referred

to as a single premium whole life policy.

When the premium is paid through out the life it is known as straight life policy, but

when the premium is paid for a specified period of time it is known as limited life

policy.

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The premiums are higher for Whole life insurance as opposed to term insurance. The

reason for this is that the policy has investment features as well as death benefits. The

cash value portion of the whole life insurance belongs to the insured. One can take it

out in the form of policy loans or can cash the policy in. Another advantage of whole

life insurance is that the premiums are fixed, i.e. regardless of your age, you pay the

same amount for the coverage each year.

Universal Life Insurance Policy

Universal life insurance is a variation of Whole Life. The difference is that with

Universal Life the insurance part of the policy is separated from the

investment portion of the policy. The cash value portion of the policy is

treated as an accumulation fund and investment income is credited to the

accumulation fund.

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MONEY BACK POLICY

Money back policies provide for periodic payments of partial survival benefits during

the term of the policy, as long as the policy holder is alive.

An important feature of this type of policies is that in the event of the death at nay

time within the policy term, the death claim comprises the full sum assured, without

deduction of nay of any of the survival benefit amounts, which may have already been

paid as money back components. Similarly the bonus is also calculated on the entire

sum assured.

ENDOWMENT POLICY

An endowment policy covers the risk for a specified period, at the end of which the

sum assured is paid back to the policy holder, along with the bonus accumulated

during the term of the policy. This feature of payment of endowment to the policy

holder when the policys term is complete is responsible for the popularity of

endowment policies.

The amount received on maturity can either be utilized either to buy an annuity policy

to generate a monthly pension for the rest of the life, or put it into any other suitable

investment of our choice. This is one important benefit which the endowment policy

offers over a whole life insurance policy.

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Overall, endowment policies are the most suitable of all insurance plans for covering

the risks to a family breadwinners life. Not only do these policies provide financial

risk cover for the family, were the policy holder to die prematurely but the insurance

amount is also repaid once this risk is over. The endowment amount can then be used

for meeting major expenditures such as childrens education and marriage, etc.

Alternately, the endowment sum is available for a suitable investment geared to

providing an income for the remainder of ones own life. These type of plans are

particularly suitable to those who other than having a risk cover are also interested in

a savings component simultaneously.

PENSION PLAN OR ANNUITIES

An annuity is an investment that we make, either in a single lump sum or through

installments paid over a certain number of years, in return for which we receive a

specific sum every year, every half year or every month, either for whole life or a

fixed number of years.

After the death of an annuitant, or after the fixed annuity period expires for annuity

payments, the invested annuity fund is refunded, perhaps along with a small addition,

calculated at that time. Annuities differ from all the other form of life insurance in one

fundamental way an annuity does not provide any life insurance cover but, instead

offers a guaranteed income either for life or a certain period.

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Typically annuities are bought to generate income during ones retired life, which is

why they are also called pension plans. Annuity premiums and payments are fixed

with reference to the duration of human life.

Kind Of Policy

Broad Definition When Received

Term Policy Like whole life but offers risk

cover for defined periods.

Risk cover in case of

death within term of

policy.

Whole life Policy Allows risk cover for whole life.

Premiums are paid throughout

life.

Received only at the

time of death of life

assured.

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Money Back Policy Allows planning return of sum

assured as lump sum after

defined intervals of time.

Received at fixed

intervals during the term

of the policy.

Endowment Policy Available for a period and life.

Sum assured may be paid in case

of death within the term of the

policy.

Either on maturity or in

the event of death of the

insured, whichever is

earlier the sum assured

plus the bonus is

received by the

beneficiary.

Pension Plans Or

Annuities

Installments paid for certain

years and in turn a specific sum

is received every year or month.

Either on the death of

the annuitant or on

expiry of the fixed

annuity period.

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SETTLEMENT OPTIONS

When the life insurance policy becomes payable, the insured or the beneficiaries may

elect to take payment in one lump sum. However, when the insured or the beneficiary,

elect not to take a lump sum payment, there are several other options available to him

for receiving his payment which are as follows:

1. INTEREST OPTION

According to this option, the entire proceeds are left with the insurance company

and it pays a guaranteed interest rate on your amount, it is similar to leaving our

money in a savings account. At any time in the future, the beneficiary can

withdraw the money.

2. FIXED AMOUNT OPTION

In this option the beneficiary receives a fixed amount of money each month until

the proceeds are exhausted.

3. FIXED PERIOD OPTION

The fixed period option will pay the beneficiary equal payments over a fixed

period of time, which may be 10 years ,20 tears or even just 5 years. Excess

interest earned will increase the amount of these payments.

4. LIFE INCOME OPTION

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This option provides the beneficiary with the proceeds paid over the rest of his

life. However when the beneficiary dies the balance of the policy are considered

used up.

CHECK LIST FOR BUYING THE RIGHT POLICY

DOS

Look out for no commission policies.

low load life insurance policies have fewer expenses built into them, such

as agent commissions and fees for marketing. This can translate into lower

premiums or for variable life insurance, these lower expenses mean that a

higher percentage of your premium goes to work for you right away so that

you can build your cash faster.

Buy as soon as the need exists

An advantage to buy life insurance earlier in life is that your premiums will be

low. As you grow old, the likelihood that you will die increases, which is why

older individuals pay more for life insurance.

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DONTS

Dont buy a guaranteed issue policy if you are healthy

Guaranteed issue term life insurance policies normally require no medical

exam and are sold to anyone who comes along. While these policies can be a great

way for people who have medical problems to obtain a life insurance policy, if

you are healthy dont buy these policies as you will get better rates by taking the

tests.

Dont buy more or less than you need

Many experts say the best way to pinpoint a smart life insurance benefit

amount is through a needs analysis which can be broken into a simple formula

Short term needs + long term needs resources = how much life insurance

you need

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HISTORY AND

GROWTH OF LIFE

INSURANCE IN INDIA

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HISTORY OF INSURANCE

The story so far

Almost 4,500 years ago, in the ancient land of Babylonia, traders used to bear risk of

the caravan trade by giving loans that had to be later repaid with interest when the

goods arrived safely. In 2100 BC, the Code of Hammurabi granted legal status to the

practice.

That, perhaps, was how insurance made its beginning.

Life insurance, on the other hand, had its origins in ancient Rome, where citizens

formed burial clubs that would meet the funeral expenses of its members as well as

help survivors by making some payments.

As European civilization progressed, its social institutions and welfare practices also

got more and more refined. With the discovery of new lands, sea routes and the

consequent growth in trade, Medieval guilds took it upon themselves to protect their

member traders from loss on account of fire, shipwrecks and the like.

Since most of the trade took place by sea, there was also the fear of pirates. So these

guilds even offered ransom for members held captive by pirates. Burial expenses and

support in times of sickness and poverty were other services offered. Essentially, all

these revolved around the concept of insurance or risk coverage. That's how old these

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concepts are, really.

In 1347, in Genoa, European maritime nations entered into the earliest known

insurance contract and decided to accept marine insurance as a practice.

The First Step

Insurance as we know it today owes its existence to 17th century England. In fact, it

began taking shape in 1688 at a rather interesting place called Lloyd's Coffee House

in London, where merchants, ship-owners and underwriters met to discuss and

transact business. By the end of the 18th century, Lloyd's had brewed enough business

to become one of the first modern insurance companies.

Insurance and Math

Back to the 17th century. In 1693, astronomer Edmond Halley constructed the first

mortality table to provide a link between the life insurance premium and the average

life spans based on statistical laws of mortality and compound interest. In 1756,

Joseph Dodson reworked the table, linking premium rate to age.

Enter Companies

The first stock companies to get into the business of insurance were chartered in

England in 1720. The year 1735 saw the birth of the first insurance company in the

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American colonies in Charleston, SC.

In 1759, the Presbyterian Synod of Philadelphia sponsored the first life insurance

corporation in America for the benefit of ministers and their dependents. This was

followed by the formation of Fire Insurance Corporations, first in New York City

(1787) and then in Philadelphia (1794).

However, it was after 1840 that life insurance really took off in a big way. The

trigger: reducing opposition from religious groups.

The Growing Years

The 19th century saw huge developments in the field of insurance, with newer

products being devised to meet the growing needs of urbanization and

industrialization.

In 1835, the infamous New York fire drew people's attention to the need to provide

for sudden and large losses. Two years later, Massachusetts became the first state to

require companies by law to maintain such reserves. The great Chicago fire of 1871

further emphasized how fires can cause huge losses in densely populated modern

cities. The practice of reinsurance, wherein the risks are spread among several

companies, was devised specifically for such situations.

There were more offshoots of the process of industrialization. In 1897, the British

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government passed the Workmen's Compensation Act, which made it mandatory for a

company to insure its employees against industrial accidents.

With the advent of the automobile, public liability insurance, which first made its

appearance in the 1880s gained importance and acceptance.

In the 19th century, many societies were founded to insure the life and health of their

members, while fraternal orders provided low-cost, members-only insurance.

Even today, such fraternal orders continue to provide insurance coverage to members

as do most labour organizations. Many employers sponsor group insurance policies

for their employees, providing not just life insurance, but sickness and accident

benefits and old-age pensions. Employees contribute a certain percentage of the

premium for these policies.

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IN INDIA

Insurance in India can be traced back to the Vedas. For instance, yogakshema, the

name of Life Insurance Corporation of India's corporate headquarters, is derived from

the Rig Veda. The term suggests that a form of "community insurance" was prevalent

around 1000 BC and practiced by the Aryans.

Burial societies of the kind found in ancient Rome were formed in the Buddhist

period to help families build houses, protect widows and children.

Bombay Mutual Assurance Society, the first Indian life assurance society, was formed

in 1870. Other companies like Oriental, Bharat and Empire of India were also set up

in the 1870-90s.

It was during the swadeshi movement in the early 20th century that insurance

witnessed a big boom in India with several more companies being set up.

As these companies grew, the government began to exercise control on them. The

Insurance Act was passed in 1912, followed by a detailed and amended Insurance Act

of 1938 that looked into investments, expenditure and management of these

companies'funds.

By the mid-1950s, there were around 170 insurance companies and 80 provident fund

societies in the country's life insurance scene. However, in the absence of regulatory

systems, scams and irregularities were almost a way of life at most of these

companies.

As a result, the government decided nationalize the life assurance business in India.

The Life Insurance Corporation of India was set up in 1956 to take over around 250

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life companies.

For years thereafter, insurance remained a monopoly of the public sector. It was only

after seven years of deliberation and debate - after the RN Malhotra Committee report

of 1994 became the first serious document calling for the re-opening up of the

insurance sector to private players -- that the sector was finally opened up to private

players in 2001.

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: 245 Indian and foreign insurers and provident societies taken over by the

central government and nationalized. LIC formed by an Act of Parliament, viz. LIC

Act, 1956, with a capital contribution of Rs. 5 crore from the Government of India.

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The insurance sector in India has come a full circle from being an open competitive

market to nationalization and back to a liberalized market again. Tracing the

developments in the Indian insurance sector reveals the 360 degree turn witnessed

over a period of almost two centuries.

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EFFECT OF LIBERALISATION

The winds of liberalization have initiated vast changes in the functioning of the

industry today. Increasing number of multi national partnerships with private insurers

have paved the way for radical shift in insurance selling through a number of new

distribution channels besides bringing about more awareness on the need for

insurance and also stressing on the important role technology can play.

With major trade barriers, gone the Indian insurance industry is slowly opening itself

from a protected environment to e business, incorporating newer technology in

insurance.

The opening up of the sector is paving way for :

Faster decision making

Easier claim settlement

Bank assurance

Improved customer service

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Utilizing the extensive network of banks for selling insurance will over a period of

time bring about an increase in insurance density besides improving insurance

penetration in rural areas wherein a large unexploited potential exists.

Insurance sector reforms

In 1993, Malhotra Committee, headed by former Finance Secretary and RBI

Governor R. N. Malhotra, was formed to evaluate the Indian insurance industry and

recommend its future direction.

The Malhotra committee was set up with the objective of complementing the reforms

initiated in the financial sector.

The reforms were aimed at creating a more efficient and competitive financial

system suitable for the requirements of the economy keeping in mind the structural

changes currently underway and recognizing that insurance is an important part of the

overall financial system where it was necessary to address the need for similar

reforms

The committee emphasized that in order to improve the customer services and

increase the coverage of the insurance industry should be opened up to competition.

But at the same time, the committee felt the need to exercise caution as any failure on

the part of new players could ruin the public confidence in the industry.

Hence, it was decided to allow competition in a limited way by stipulating the

minimum capital requirement of Rs.100 crores. The committee felt the need to

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provide greater autonomy to insurance companies in order to improve their

performance and enable them to act as independent companies with economic

motives. For this purpose, it had proposed setting up an independent regulatory body.

THE INSURANCE REGULATORY AND DEVELOPMENT

AUTHORITY

Reforms in the Insurance sector were initiated with the passage of the IRDA Bill in

Parliament in December 1999. The IRDA since its incorporation as a statutory body

in April 2000 has fastidiously stuck to its schedule of framing regulations and

registering the private sector insurance companies.

The other decisions taken simultaneously to provide the supporting systems to the

insurance sector and in particular the life insurance companies was the launch of the

IRDAs online service for issue and renewal of licenses to agents.

The approval of institutions for imparting training to agents has also ensured that the

insurance companies would have a trained workforce of insurance agents in place to

sell their products, which are expected to be introduced by early next year.

Since being set up as an independent statutory body the IRDA has put in a framework

of globally compatible regulations. In the private sector 12 life insurance and 6

general insurance companies have been registered.

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The important functions of IRDA are as follows:

To exercise all powers & functions of controller of Insurance.

Protection of the interest of the policyholders.

To issue, renew, modify, withdraw or suspend certificate of registration.

To specify requisite qualification & training for insurance intermediaries &

agents

To promote & regulate professional organization connected with Insurance.

To conduct Inspection/investigations etc.

To prescribe method of Insurance Accounting.

To regulate investment of funds & margins of solvency.

To adjudication upon disputes.

To conduct inspection & audit of insurers, intermediaries & other

organizations concerned with Insurance.

Current Status

The IRDA bill had been introduced in the Lok Sabha during the Vajpayee

governments last tenure with the expected mixed reactions. The Banking Regulation

Act is to be modified to allow banks to become active players in the insurance sector.

This comes as a major move

The takeout of the amendment made to Section 6 (0) of the Banking Regulation Act,

1949 is this: the current act does not permit banks to handle insurance products. The

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proposed change will permit banks to either distribute or to market insurance

products. In addition to this, banks will also be allowed entry to the insurance sector

through the joint venture route and bank assurance. It is understood that only strong

banks with three-year track records will be allowed to enter the business - entry is a

strict no-no to the weaker banks. The Insurance Regulatory and Development

Authority (IRDA) Bill provides for three levels of players - an insurance company,

insurance broker and an agent. Banks will work as agents and brokers in this proposed

structure.

This is an attempt to make the insurance sector more dynamic - this is likely to

happen as banks will use their formidable branch network to market and distribute the

insurance products.

The Indian insurance industry which until now was a controlled sector, with only two

players for the last four and half decades, has suddenly turned itself into a

battleground. Though the sector remained in the strong clutches of the government

enterprises, the growth has been slow. The industry is characterized by a number of

players, both domestic and international, competing for the huge untapped market.

The Indian insurance sector is witnessing a slow and steady change. Though the

sector is yet to come out of the Government control completely, the new entrants are

hopeful of competing head-on with the state-owned monopolies and create a niche for

themselves.

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COMPANY PROFILE

AVIVA LIFE INSURANCE

THE COMPANY

Aviva Life Insurance is a joint venture between Dabur and Aviva. Aviva Plc is UK's

largest insurance group. Today, with 25 million customers in over 50 countries and

assets under management in excess of US $300 billion AVIVA life insurance is the

oldest company in the world and is a pioneer in its own field. It is the 3 rd largest Life

insurance company in the global. It has its root in U.K where it is the largest insurer.

Most lives in U.K are covered by AVIVA. The asset of AVIVA is over $300 billion.

It has got 25 million customers worldwide and reaping the benefit of the product.

Around 64,000 people are working for AVIVA worldwide. It has 40 major

partnerships with leading banks across the globe.

In India it has tied up with well know and admired company DABUR. The joint

venture is form to cater the growing need of life insurance.

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Founded in 1884, Dabur is one of India's oldest and largest group of companies with

annual sales of Rs. 1,200 crores. It is the country's leading producer of traditional

healthcare products.

Together they have been looking after generations of customers, over hundreds of

years, and are committed to ensuring that we enjoy the very best financial health.

Aviva Life Insurance aims for superior long-term investment performance and has the

financial and management strength to deliver. Along with millions of customers

worldwide we can feel certain of our choice, whether we invest for the future or

provide against the unexpected.

WHO ARE THEY

Aviva Plc is the largest UK based life and general insurance group. A top priority at

Aviva Plc has been the establishment of truly international businesses built on

strong local partnerships and joint ventures. The Group's success in combining

this strategy with a well-balanced portfolio of life and general business can be

seen in a modern, unified operation across the globe.

Aviva Plc is one of the major institutional investors in the UK, holding 3% of British

industry quoted on the London Stock Exchange and 7% of the UK gilt market. It is a

top-five European life insurer based on premium income, with leading positions in the

UK, the Netherlands, Ireland, Poland, Spain, Singapore and Turkey. The Group is

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among the top 10 asset managers in Europe and the second-largest UK-based fund

manager by reference to funds under management, which exceed US $300 billion.

Aviva Plc's service standards, responsiveness and portfolio of products are

customized to suit the individual needs and requirements of its customers across the

world. The Group's 64,000 employees serve more than 25 million customers

worldwide.

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Promoters

Dabur

Founded in 1884, Dabur is one of India's oldest and largest group of companies with a

consolidated annual turnover in excess of Rs 2,396 crores. A professionally managed

company, it is the country's leading producer of traditional healthcare products.

Corporate website: http://www.dabur.com

Aviva plc

Aviva is the UKs largest and the worlds fifth largest insurance Group. It is one of

the leading providers of life and pensions products to Europe and has substantial

businesses elsewhere around the world. With a history dating back to 1696, Aviva has

a 50 million customer base worldwide. It has more than 381 billion of assets under

management.

Corporate website: http://www.aviva.com

http://www.dabur.com/http://www.aviva.com/http://www.dabur.com/http://www.aviva.com/

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MANAGEMENT TEAM

TR Ramachandran - Chief Executive Officer & Managing Director

TR Ramachandran is the Chief Executive Officer and Managing Director at Aviva

India, since November 1, 2008. He is responsible for enhancing Indian operations

through strengthening Bancassurance and alternate sales channels, improving

operating performance, enhancing the productivity of the direct sales force and

aligning the goals of the company with customer and employee satisfaction. Ram also

helps in building Avivas employer brand and the Spirit of Aviva.

Prior to this, he was working with Citibank, where he developed strategic plans for

business growth and business start-ups. He was also responsible for developing

infrastructure, market expansion, product development and product launches. His 19

years of financial services experience is spread across retail banking, consumer

finance and credit cards services. Ram has led large teams of diverse employees and

has a proven track record of building franchises, delivering business results and

general management.

Abhay Johorey - Chief Operating Officer

Abhay Johorey is the Chief Operating Officer at Aviva India. He joined the company

in October 2005. In his current capacity, he plans and drives high-impact, strategic

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initiatives involving large scale organisational change, including facilitating our

leadership charter projects. Abhay also leads and manages complex stakeholder

relationships and multi-disciplinary cross-functional teams to enable this. He plays the

role of a vital link between the supply-side delivery functions and customer-facing

demand management of the firm.

Abhay started his career with Citibank, India in 1990. Over the past 18 years, he has

gained vast experience across the retail and wholesale segments of the financial

services domain.

Rajeev Arora Director, Finance & Actuarial

Rajeev Arora has been the Director, Finance and Actuarial at Aviva India since

September 1, 2007. He joined the company in 2003 as an Associate Director,

Business Risk and Internal Audit. Currently, Rajeev provides strategic direction in

creating synergies between the Finance and Actuarial segments and also manages the

financial performance of Aviva India. His role also includes building strong

capabilities in financial planning, accounting, valuations, reinsurance accounting,

financial reporting, profit accounting and all IRDA-related compliances.

Prior to joining Aviva, Rajeev has worked with PriceWaterhouse Coopers, Ernst and

Young, and Deloitte & Touch.

Shoumitro Roye Sales Director

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Shoumitro Roye has been the Sales Director at Aviva India since July 2007. His

objective has been to create synergies within the sales functions and bring in

necessary focus and drive business. Shoumitro manages both the Direct Sales Force

and the Bancassurance divisions of Aviva India. He has played a key role in the

acquisition of Eagle Insurance, Sri Lanka.

Prior to joining Aviva, Shoumitro worked with BNP Paribas and American Express

Bank Limited. He has more than 19 years of proven sales management experience at

various levels.

Anil Sahgal Director, Strategy & Chief Investment Officer

Anil Sahgal has been the Director - Strategy and Chief Investment Officer at Aviva

India since April 2007. He joined the company in 2001. At present, Anil manages a

portfolio of strategic projects.

At Aviva India, he has led the transition of the fund management team into a customer

and sales focused team, while delivering strong performance results. Anil has also

held various key positions in operations and strategy. Prior to this, he has worked with

Dundee Investment Management, amongst others.

Monica Agrawal Director, Corporate Initiatives

Monica Agrawal, has been the Director, Corporate Initiatives, since February 2008.

She is responsible for implementing a wide range of high-impact strategic and

business initiatives. Monicas role is to bridge between strategy and implementation

and her responsibility is to focus on executing projects that will facilitate the growth

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and scope of the business. She is also a part of the team responsible for implementing

vision, innovations and delivery of the business plan.

Prior to joining Aviva, Monica has worked with MasterCard Worldwide Group,

HSBC Ltd and Bennett, Coleman & Company Ltd amongst others.

Chandan Khasnobis Appointed Actuary

Chandan Khasnobis is the Appointed Actuary at Aviva India. He joined the company

in October 2003. At present, he manages product design and development, valuation,

investment decisions and duties within an administrative and regulatory capacity, to

ensure that the company runs on sound financial lines and meets its business

objectives.

Prior to joining Aviva, Chandan has worked with Canada Life Limited in UK,

Zimbabwe Actuarial Consultants, KenIndia Assurance Company Limited and the Life

Insurance Corporation of India.

Mohammad Shahber Associate Director, Human Resources

Mohammad Shahber has been the Associate Director, Human Resources (HR) at

Aviva India since April 2007. He joined the company in July 2006. Shahber is

responsible for leading the Corporate and Regional HR team, supporting the

development and implementation of robust processes facilitating HR operations and

ensuring compliance with relevant statutory rules and regulations. He is also

responsible for talent acquisition and organisational development.

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Prior to joining Aviva India, Shahber has worked with Bharti Infotel Ltd (Airtel) and

Hughes Escorts Communications Ltd., amongst others.

Ronald Cheyne Director, Distribution

Ronald Cheyne has been the Director, Distribution at Aviva India since September

2007. He is responsible for developing Avivas direct sales force and enhancing its

quality, effectiveness and management. Ronald has been instrumental in establishing

ASTRA and implementing a post selection programme for branch and agent

profitability. He has also played an important role in developing the capabilities of the

senior sales management teams.

Prior to this, Ronald has worked with Eagle, Windsor Life Assurance Co. Ltd., New

York Life Worldwide Inc. and Canada Life, amongst others. He has a rich

international industry experience of nearly 27 years.

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AVIVA LIFESHIELD PLUS

Overview

Aviva LifeShield plus provides comprehensive protection for your family at a

nominal cost through:

Payment of Life Cover (Sum Assured) to your family in the event of your

death, with a provision of double the Life Cover in the case of an accidental

death.

Immediate payment of the Life Cover in the case of critical illness or

permanent total disability, while life cover continues till the policy term

Most competitive rates

AVIVA LITTLE MASTER

Overview

Aviva Little Master is a holistic child plan that enables you to secure your child's

future in any eventuality and also covers your child's life through:

Attractive returns in addition to bonus units value on maturity, to help you

enhance the desired corpus for your child

Payment of the Sum Assured to the child or appointee (if the child is a minor),

in the unfortunate event of patent's death, disability or on contracting a critical

illness. All future premiums are waived off and invested as a lump sum

amount in the funds and the policy continues

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Provision of a regular income for the minor child, in the event of parent's

death

Life cover on the child

FREEDOM LIFE PLAN

Overview

Freedom Life Plan allows you to choose the proportion of savings and protection and

change it, in line with your changing needs, with the option to pay premiums for as

few as 3 years, through:

Option to reduce premium and increase / decrease Life Cover (Sum Assured)

Range of cover from 5*AP to 1.25*PT*AP

Select from three riders Accidental Death and Dismemberment Rider

(AD&D) , Critical Illness and Permanent Total Disability Rider (CI&PTD) ,

Hospital Cash Benefit Rider (HCB)

Indexation to protect savings & protection against inflation

Limited premium paying term(PPT) including 3 & 5 years, with an option to

increase the PPT (if PPT>=10)

5 fund options (Growth, Balanced, Enhancer, Protector, Bond), AAA & STP

100% allocation from sixth year

Mentioned as one of the top 2 products with the lowest charges in Outlook magazine

Pensionplus

http://www.avivaindia.com/Individual/Savings/FreedomLifePlan.aspxhttp://www.avivaindia.com/Individual/Savings/FreedomLifePlan.aspxhttp://www.avivaindia.com/Individual/Savings/FreedomLifePlan.aspxhttp://www.avivaindia.com/Individual/Savings/FreedomLifePlan.aspxhttp://www.avivaindia.com/Individual/Savings/FreedomLifePlan.aspxhttp://www.avivaindia.com/Individual/Savings/FreedomLifePlan.aspxhttp://www.avivaindia.com/Individual/Savings/FreedomLifePlan.aspxhttp://www.avivaindia.com/Individual/Savings/FreedomLifePlan.aspxhttp://www.avivaindia.com/Individual/Savings/FreedomLifePlan.aspxhttp://www.avivaindia.com/Individual/Savings/FreedomLifePlan.aspxhttp://www.avivaindia.com/Individual/Savings/FreedomLifePlan.aspxhttp://www.avivaindia.com/Individual/Savings/FreedomLifePlan.aspxhttp://www.avivaindia.com/Individual/Savings/FreedomLifePlan.aspxhttp://www.avivaindia.com/Individual/Savings/FreedomLifePlan.aspx

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Overview

Pension Plus is a market leading pension plan that helps you accumulate and grow

your investments, to fund your post-retirement years through:

Attractive returns (one of the best in the industry, enhanced by loyalty

additions for all regular premium polices, with policy term of at least 20 years)

Option of Indexation and Additional Regular Premium to beat inflation as well

as align the retirement corpus with the desired lifestyle post-retirement

AVIVA LIFESHIELD PLUS

Overview

Aviva LifeShield plus provides comprehensive protection for your family at a

nominal cost through:

Payment of Life Cover (Sum Assured) to your family in the event of your

death, with a provision of double the Life Cover in the case of an accidental

death.

Immediate payment of the Life Cover in the case of critical illness or

permanent total disability, while life cover continues till the policy term

Most competitive rates

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Aviva Health Plus

Overview

Aviva Health Plus is a comprehensive health cum savings plan that covers you against

death and ill health, while guaranteeing the return of a part of the premium on

maturity through:

Provision of a Life Cover (Sum Assured) on death and disability

Protection against 18 critical illnesses

A combined benefit of more than Rs 21 lakh, in case all health benefits are

claimed

Extended death and disability cover for 5 years after the health benefits cease

Guaranteed maturity benefit on the date of maturity, even if all health benefits

are claimed.

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LIFE LONG

Life Long is a flexible whole life plan designed to suit your individual requirements,

no matter which life stage you are in and change as your needs change during your

entire life. For younger families, maximum protection can be provided at moderate

cost but as the need for protection in future reduces, the sum insured under the policy

may be reduced, thus increasing the savings content.

LIFE SAVER

Life Saver is a flexible endowment plan designed to meet your specific long-term

savings needs such as education and wedding costs, with the added reassurance of life

cover to meet those costs should something untoward happen before the policy

matures.

LIFE BOND

Life Bond is a single premium savings plan designed by Aviva to provide you the

maximum benefit of investment return and the security of the investment to match

your medium term savings needs.

CORPORATE LIFE

Corporate Life is a product designed primarily for the corporate sector to provide life

cover to their employees. The product can also be targeted at other suitable groups.

This is a group term insurance product, which provides cover against risk of death.

The Corporate is the master policyholder. It is a yearly renewable product. Additional

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covers against accidental death and permanent total disability are also available, if

opted for by the master policyholder.

EASY LIFE PLUS

Easy Life Plus is designed to be a simple regular savings plan with the benefit of life

protection. By choosing an appropriate premium level and term, you can match the

maturity date of the policy to a specific savings need such as childrens education,

wedding, etc. Easy Life Plus is specially designed for members of select groups such

as Bank Customers, Employer-Employee, or any other similar recognized group.

CREDIT PLUS

Credit Plus is a product specially designed for Micro Finance Institutions who provide

loans to individuals in the rural and social sectors and who would also like to provide

some financial security to the families of these individuals (members).This is a yearly

renewable group term insurance scheme which provides death cover on group basis.

PENSION PLUS

Pension Plus is a tax efficient personal pension plan that is designed to help you earn

a regular income even after you stop working. Through this plan, you build a fund till

you retire which provides you financial security on retirement.

SECURE LIFE

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Secure Life is an ideal life insurance plan that helps you protect your familys future.

Depending on your requirements, whether it be for your childs education or

marriage, loan repayments, etc., Secure Life ensures that your familys needs are met

should something unfortunate happen to you. What is more, the entire premium that

you pay during the policy term is returned to you on survival, at maturity.

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COMPANYS PROFILE

MAX NEW YORK LIFE INSURANCE COMPANY LTD.

Max New York Life Insurance Company Ltd. is a joint venture between New York

Life, a Fortune 100 company and Max India Limited, one of India's leading multi-

business corporations. The company has positioned itself on the quality platform. In

line with its vision to be the most admired life insurance company in India, it has

developed a strong corporate governance model based on the core values of

excellence, honesty, knowledge, caring, integrity and teamwork. The strategy is to

establish itself as a trusted life insurance specialist through a quality approach to

business.

In line with its values of financial responsibility, Max New York Life has adopted

prudent financial practices to ensure safety of policyholder's funds. The Company's

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paid up capital is Rs. 587 crore, which is more than the norm laid down by Insurance

Regulatory Development Authority (IRDA).

Having set a best in class agency distribution model in place, the company is

spearheading a major thrust into additional distribution channels to further grow its

business. The company is using a five-pronged strategy to pursue alternative channels

of distribution. These include the franchisee model, rural business, direct sales force

involving group insurance and telemarketing opportunities, banc assurance and

corporate alliances.

Customers to Max New York Life offer a suite of flexible products. It now has 22 life

insurance products and 8 riders that can be customized to over 400 combinations

enabling choose the policy that best fits their need.

Max New York Life is the first life insurance company in India to be awarded the IS0

9001:2000 certifications.

Max New York Life was among the top 25 companies to work with in India,

according to 2003 Business World magazine, "Great Workplaces In India", Max New

York Life was ranked at the 20th position. This survey is the local version of the

"Great Places to Work" survey carried out every year in 22 countries.

We were among top five most respected private life insurance companies in India

according to a 2004 Business World survey.

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We have truly built an enviable sales force. With 201 agents becoming members of

the MDRT in 2005, Max New York Life has moved up in the Top 50 MDRT global

list.

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ABOUT NEW YORK LIFE

New York Life Insurance Company, a Fortune 100 company founded in 1845, is

the largest mutual life insurance company in the United States and one of the largest

life insurers in the world. Headquartered in New York City, New York Lifes family

of companies offer life insurance, annuities and long-term care insurance. New York

Life Investment Management LLC provides institutional asset management and

retirement plan services. Other New York Life affiliates provide an array of securities

products and services, as well as institutional and retail mutual funds.

The mission of New York Life is to maintain its superior 'financial strength', adhere to

the highest standards of 'integrity' and demonstrate 'humanity' by treating its

customers, agents and employees with compassion, consideration and respect.

New York Life is one of the largest and strongest life insurance companies in the

world with more than USD$215 billion assets under management and has received

among the highest ratings for financial strength from the life insurance industry's

principal rating agencies: A.M. Best (AA+), Standard & Poor's (AA+), Moody's

(Aa1), Fitch (AAA). According to Moody's, "New York Life's rating reflects the

company's good quality investment portfolio, ample liquidity, and sound

capitalization, as well as the good growth potential of its international business.

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As a leader in the insurance industry, New York Life continues to bring to its

operations new management concepts, advanced technologies, new distribution and

training systems and innovative insurance products.

ABOUT MAX INDIA LIMITED

Founded in 1985, Max India Limited is a Public Limited company listed in the NSE

and BSE of India with over 37,000 shareholders.

Today, Max India Limited is a multi-business corporate, driven by the spirit of

Enterprise, focused on Knowledge, People and Service oriented businesses of:

Healthcare (Max Healthcare)

Life Insurance (Max New York Life Insurance)

Clinical Research (Neeman Medical International)

Max also maintains interests in:

Specialty Plastic Products for the packaging industry (Max Specialty

Products)

Healthcare Staffing (Max Health Staff)

Prominent shareholders are Mr. Analjit Singh and a leading private equity firm,

Warburg Pincus that accounts for 28.7% of the total shareholding. The public and

Institutional Investors hold the balance shareholding.

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Till 1999, the companys main interests and partnerships were the following:

Business Partners

Bulk Active Pharmaceuticals DSM Gist Brocades

Electronic Component Distribution Motorola, USA

Electronic Component Distribution Avnet Inc., USA

Mobile Telephony Hutchison Telecom Ltd.

Hong Kong

V-SAT Communications Comsat Investment Inc.,

USA & Lockheed Martin,

USA

Plating Chemicals Atotech, Germany

Information Technology Mind Crossing, USA

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In 2000, the Company reinvented and restructured itself to focus on the businesses of

Life under the theme, LifeOur Focus.

Max New York Life Insurance, founded as a Joint Venture between Max India

Limited and New York Life, a Fortune 100 company, is one of the leading private life

insurers in India.

Max Healthcare, a subsidiary of Max India Limited is Indias first provider of

comprehensive, standardized, seamless, and integrated world-class healthcare

services.

Neeman Medical International (NMI) is an International Clinical Research provider

operating across three locations spanning North America, Asia and Latin America.

Each location is backed by comprehensive infrastructure and highly skilled and

experienced personnel.

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Board of Directors- Max India Limited

Dr Bhai Mohan Singh Lifetime Chairman Emeritus, Max India

Mr. Analjit Singh Chairman, Max India

Dr S S Baijal Former Chairman, ICI Ltd.

Mr. N C Singhal Former Vice Chairman & MD, SCICI

Mr. N Rangachary Former Chairman, IRDA

Mr. Nitin Sibal Vice President, Warburg Pincus India Pvt. Ltd.

Mr. Piyush Mankad Former Secy., Ministry of Finance, Govt. of India

Mr. Ashwani Windlass Former Managing Director, Hutchison Max

Mr. Bharat Sahgal Managing Director, Warburg Pincus India Pvt. Ltd.

Mr. B Anantharaman Jt. Managing Director, Max India

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Vision of MNYL

To become the most admired life insurance Company in India.

This we hope to achieve by:

o Understanding the needs of customer and offering them superior

products and services.

o Leveraging technology to service customers quickly, efficiently and

conveniently.

o Providing an enabling environment to foster growth and learning for

our employees.

o And above all, building transparency in all our dealings.

We do believe that we are on the threshold of an exciting new opportunity, where we

can play a significant role in redefining and reshaping the sector. Given the quality of

our parentage and the commitment of our team, there are no limits to our growth.

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MISSION OF MNYL

Become one of the top quartile life insurance companies in India

Be a national player

Be the brand of first choice

Be the employer of choice

Become principal of choice for agents.

VALUES OF MNYL

This vision to become India's most admired life insurance company will be realized

through our unique set of values, which are as follows:

Knowledge

Knowledge leads to expertise; and our expertise is in helping people protect them.

Perfectly combining global expertise with local knowledge, we are India's life

insurance specialist. Max New York Life believes that for knowledge to be of value it

must be focused, current, tested and shared.

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Caring

Max New York Life is redefining the life insurance paradigm by focusing

on customers first. The service process is responsive, personalized, humane and

empathetic. Every individual who represents the company is for us our brand

champion.

Honesty

Honesty is the heart of the life insurance business. It is all about trust. Transparency,

integrity and dependability form the cornerstones of the Max New York Life

experience. The company ensures that everyone who represents the brand carries a

promise: we care in word as well as deed.

Excellence

Excellence at Max New York Life implies the ability to perform at a consistently high

level. Focused on the value of continuous improvement in people, processes and the

organization, the company strives for the highest standards of quality in every aspect

of its business.

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RESEARCH

METHODOLOGY

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OBJECTIVE OF THE STUDY

The Objective of the study was to get an understanding of the life insurance segment

of the insurance industry. The Scope of the study involves

Measuring the impact of the aviva life insurance company in the Indian market

and on Indian consumers.

Figure out the prospects of the aviva and max new life insurance in the Life

insurance market.

Familiarizing oneself with various products available and the additional

features or the riders attached to them.

Analyzing the schemes offered by the private sector players.

Comparison of the aviva life insurance and max newyork life insurance in the

insurance market.

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RESEARCH METHODOLOGY

We have conducted our research taking into consideration only 5 private players

existing in the market namely AVIVA LIFE INSURANCE and MAX NEW YORK

LIFE INSURANCE. On the basis of their performance we have drawn conclusions

for the whole sector.

The information for the project of finance on life insurance industry has been

collected from both primary as well as secondary sources.

In case of primary sources the information was retrieved directly from the concerned

people and the authorities. We have conducted our research mainly with the help of

the invaluable inputs provided by the consumers of products of the private players in

the form of a questionnaire drafted by us. The questionnaire method was used as it is

more versatile than any other method and further a questionnaire is pre planned and

thus less time is wasted since a planned set of questions are available. We have taken

a sample size of 200 people. Our analysis is completely based on the responses given

to us by the respondents and the result for the same has been presented in the form of

pie charts and graphs. While there was some information, which could not be

obtained through questionnaires, for that purpose we resort to personal interviews. A

total of six In depth interviews were also taken of the agents and managers of these

private players.

Since secondary data are information published by others and the companies they

were easily available and not much effort was required in obtaining the information.

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SOURCES OF DATA

PRIMARY DATA

Questionnaires.

In depth interviews with the agents and managers of private life insurance

companies.

SECONDARY SOURCES

Newspapers.

Magazines.

Internet sites.

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DATA COLLECTION

PRIMARY DATA

The primary data are those data which are collected afresh and for the first time and

happen to be original in character. The primary data to be collected for the study are-

By Structured Questionnaire (Customer)

SECONDARY DATA

Secondary data are those data which have already been collected by someone else and

which already had been passed through the statically process. The secondary data to

be collected for the study are-

Publication of the company

Periodical of the company

By Internet Websites

RESEARCH INSTRUMENT

STRUCTURED QUESTIONNAIRE:

A Questionnaire consist of a number of questions printed or typed n a definite order

on a form or set of forms. It is the set of questions presented to the retailers for their

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answers. When the questions have only two alternatives or of multiple choice, then it

is known as closed-end questionnaire, which is hence used the given study.

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DATA ANALYSIS

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ANALYSIS OF THE MARKET

FINDINGS

It may be noted that the pie charts and bar diagrams have been drawn on the basis of

the total number of questionnaires filled i.e. 200 and on the basis of the number of

responses we have received for each question. The interpretation for the same has

been done in percentage form.

1. Thinking of insurance, what comes to your mind?

50%

30%

20%

INSURANCE MEANS

LIC

SECURITY

TAX SA VING

Majority of the population(50%), when they think of insurance it means LIC where as

20% & 30% of the population think it as tax saving and security respectively. Thus it

can be seen that LIC is well based in the minds of the people.

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2. Out of the following, you have an insurance policy of (put tick

mark)

AVIVA [ ] NEW YORK MAXLIFE [ ]

Others, specify

60%

40%

Aviva Max New york

Major part of the population has their insurance policy in Aviva. And max new York

have less business than aviva.

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3. What type of policy do you have?

TYPES OF POLICIES PEOPLE HAVE

20 20

1214

28

0

5

10

15

20

25

30

POLICIES

No.OFPEOPLE

ENDOWMENT

WHOLE LIFE

MONEY BACK

SINGLE PREMIUM

TERM POLICY

Most of the people have term policies; endowment and whole life are on the same

platform. Money back and single premium are less desirable by the people.

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4. What do you look for, while opting for a Life Insurance Company?

24%

33%

9%

34%

PEOPLE LOOK FOR WHILE OPTING FOR LIFE

INSURANCE COMPANY

RETURN ON

INVESTMENT

GOODWILL

ADDITIONAL

BENEFITS

SECURITY

When people opt for a Life Insurance Company, most of them look for security of

their money, goodwill of the company and return on their investment. Not many of

them look for additional benefits.

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5. What do you look for, while opting for a Life Insurance policy?

31%

22%

24%

23%

PEOPLE LOOK FOR WHILE OPTING FOR LIFEINSURANCE POLICY

TAX SAVING

INCOME SECURITY

OLD AGE BENEFITS

SAVINGS

In India most of people take insurance policy because it gives them tax benefits. It

plays a major role. Others such as income security, savings and old age benefits go

behind it.

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6. Do you think insurance is superior to other forms of savings?

84%

16%

INSURANCE SUPERIOR TO OTHERFORM OF SAVINGS

YES

NO

Majority of the population believe that insurance is superior to other form of savings.

It provides tax benefits which is not provided in other forms of savings and to the

more it provides security for the future.

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7. Is price an important consideration while opting for an insurance

policy?

74%

26%

PRICE IS AN IMPORTANT CONSIDERATION

YES

NO

Most of the people when they opt for an insurance policy, price is an important

consideration for them. However, about 26% of the population do not consider price

as an important consideration while opting for an insurance policy.

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CONCLUSION

&

RECOMMENDATIONS

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Consumers today also seek products that offering flexible options, preferring products

with benefits unbundled and customizable to suit their diverse needs.

The trend in developed economies where people not only live longer and retire earlier

is now emerging in India. With the breakdown of traditional forms of social security

like the joint family system, consumers are now concerning themselves with the need

to provide for a comfortable retirement.

This trend has been further driven by the long-term decline in interest rates, which

makes it all the more necessary to start saving early to ensure long term wealth

creation. Today's consumers are increasingly interested in products to help build

wealth and provide for retirement income.

This all adds up to major change in demand for insurance products. Firms will need to

constantly innovate in terms of product development to meet ever-changing consumer

needs.

Competition will result in the market to grow beyond current rates and offer

additional consumer choice through the introduction of new products, services and

price options. With the heightened awareness and consumer education comes a

willingness to view life insurance as an integral part of the financial portfolio. No

longer is life insurance a poorly understood product that is pushed onto people. Nor is

it a product that is only to be bought hurriedly at the time of filing taxes. It's now

catching on as an important element that is purchased to fulfill specific rational and

emotional needs and has clear benefits and advisors are being trained to sell insurance

as a solution to meet these needs.

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To conclude with we would just like to say that in the Indian life insurance market is

aviva life insurance have a good market position quite a big one and more importantly

a huge part of it has been left untapped till now, therefore there is enough room for all

the private players to establish themselves provided they give the Indian consumer the

best value for their money in the long run because it will take time for the people to

get out of the nutshell of being getting insured only with LIC as till few years ago it

used to have an absolute monopoly in this market.

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LIMITATIONS

As per my experience at Aviva insurance what I got to know is:

Out of l00% tele-calling only l0% agrees and 2% gets converted that too

by approaching the customers again and again and time allotted to us was limited as it

even takes three to four months or may be more to get one call converted.

We have me limited geographical coverage area i.e. confined to only

meerut because clients are also there m other cities.

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RECOMMENDATIONS

Need to create and effectively deploy differentiated strategies in sales,

distribution and marketing.

Right customer identification and thus segmentation which need to be

appropriate.

Design and manage sales force, which yields high performance. Training of

the employees can be done so that they produce best results.

Need to create better, differentiated and detailed brochures.

Increase its agent sales force quantity as well as quality.

Target the rural population which is one of the biggest untapped area.

Less harassing documentation w.r.t insurability and claims.

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General some innovative and alternative channels of distribution, using the sources

that can straight play with the emotions of the person and influence so high that it

forces the being to go for insurance and that too willingly

ANNEXURE

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QUESTIONNAIRE

Dear Sir/Madam,

I am conducting a survey to measure the prospects of private insurers

in life insurance business. I like to include your opinion in this survey. I request you

to answers the following questions.

1. Thinking of insurance, what comes to your mind?

2. Out of the following, you have an insurance policy of (put tick mark)

AVIVA [ ] NEW YORK MAXLIFE [ ]

Others, specify

3. What type of policy do you have? (Put tick mark)

Endowment [ ] Money Back[ ] Term Policy [ ]

Whole Life [ ] Single Premium [ ]

Other, specify..

4. What do you look for, while opting for a Life Insurance Company? (Put

tick mark)

Return on Investment [ ] Goodwill [ ]

Additional Benefits [ ] Security [ ]

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Others, specify

5. What do you look for, while opting for a Life Insurance policy?

Tax Saving [ ] Income

Security [ ]

Old Age Benefits [ ] Savings [ ]

Other, specify.

6. Do you think insurance is superior to other forms of savings?

Yes [ ] No[ ]

7. Is price an important consideration while opting for an insurance policy?

Yes [ ] No[ ]

8. At any point of policy period, have you ever claimed your policy?

Yes [ ] No [ ]

9. Have you ever insured with aviva?

Yes [ ] No[ ]

10. Any particular reason for opting out of the aviva?

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Yes[ ] No[ ]

If yes, why?

11. Which private Life Insurance Company advertisement is more

informative? (put tick mark)

12. Any suggestions to improve the services offered by various insurers?

Parameters Excellent Very

Good

Goo

d

Average Poor

AVIVA

New York

MaxLife

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BIBLIOGRAPHY

Beri G.C., Marketing Research, Tata McGraw Hill Publishing Co. LTD., New

Delhi, Third Edition (2002)

Saxana Rajan, Marketing Management, Tata McGraw Hill Publishing Co.

LTD, New Delhi, Second Edition (2001)

Saxena R.S., Marketing Management, Himalaya Publication, New Delhi,

Ninth Edition (2000)

Kotlar Philip, Marketing Management, Pren Tice-hall of India PVT. LTD.,

New Delhi, Ninth Edition (2002)

Bhandari, Research Methodology, Print 2004, Second edition

www.avivaindia.com

www.google.com

http://www.avivaindia.com/http://www.google.com/http://www.avivaindia.com/http://www.google.com/http://www.rediff.com/