Project report on customer relationship management in reliance life insurance by Sanjay Gupta

RELIANCE LIFE INSURANCE, KOPPAL

A Project Report On Customer Relationship Management in Reliance Life Insurance KOPPAL Submitted in partial fulfillment of the requirements for Award of Master of Business Administration

RELIANCE LIFE INSURANCE, KOPPAL

Declaration

I hereby declare that the project entitled “CUSTOMER RELATIONSHIP MANAGEMENT” undertaken at RELIANCE LIFE INSURANCE COMPANY LTD,KOPPAL submitted in partial fulfillment of the requirement for the award of the degree in Master in Business Administration to the Indian Institute of Business Management, Pune. It is my original work and is not submitted for the award of any other degree or diploma.

Place Date

XYZ

RELIANCE LIFE INSURANCE, KOPPAL

ACKNOWLEDGEMENT As I look back after the completion of my project I feel it would not have been possible without the guidance. I am very grateful to all the people who have lent their precious time and advice for rendering this project successful. I take this opportunity to thank them all. Firstly, I am grateful to â&#x20AC;&#x153;RELIANCE LIFE INSURANCE COMPANY LTD, KOPPALâ&#x20AC;? for giving me an opportunity to undertake this project in their organization. I sincerely express my thanks to my company project guide XYZ for his strong support and inspiration during my project period. I heartly thankful to all the executives of the company for their valuable guidance and for sharing their experience in completing this project successfully, I am thankful to our Chairman Dr. XYZ for the strong inspiration during the project period. I would like thank our institute guide XYZ for having given me this opportunity and for his valuable ever-patient guidance ever endeavoring support, timely help and constant encouragement and also I am thankful to all faculty members of my institution for their valuable guidance in completing this project successfully. I also express thanks to my parents, my family members, and all my friends for their valuable support in completion of this project successfully. Last but not least I am thankful to all those people who helped us directly and indirectly. Place: Date:

XYZa

RELIANCE LIFE INSURANCE, KOPPAL

CONTENTS

Chapter 1 Chapter 2

Rationale for the study Objective of the study

Chapter 3 Chapter 4 Chapter 5

 Title of the project  Objective of the study  Scope of the study Profile of the company Theoretical Perceptive Research Methodology

1 2-3

4-50 51-59 60-62

Research Design Data collection methods / sources Sampling plan which should include sampling unit, sampling size and sampling methods via questionnaire methods, interview methods, observations etc Chapter 6

Data analysis and interpretations using various charts and

63-77

graphs Chapter 7 Chapter 8 Chapter 9

Findings Limitations if any Expected contribution from the study Appendix and Bibliography

Rationale for the Project

78-79 80 81-82 83-89

RELIANCE LIFE INSURANCE, KOPPAL Reliance Life Insurance Company Limited is a part of Reliance Capital Ltd. of the Reliance - ANIL DHIRUBHAI AMBANI Group. Reliance Capital is one of Indiaâ&#x20AC;&#x2122;s leading private sector financial services companies, and ranks among the top 3 private sector financial services and banking companies, in terms of net worth. Reliance Capital has interests in asset management and mutual funds, stock broking, life and general insurance, proprietary investments, private equity and other activities in financial services. Yet, nearly 80 per cent of Indian population is without life insurance cover while health insurance and non-life insurance continues to be below international standards. And this part of the population is also subject to weak social security and pension systems with hardly any old age income security. This itself is an indicator that growth potential for the insurance sector is immense.

Title of the Project

RELIANCE LIFE INSURANCE, KOPPAL

“Customer Relationship Management in Reliance Life Insurance”

OBJECTIVES

1. To study the company’s procedures conducted by the company for retaining the customers. 2. To study the current market trends in Customer Relationship Management.

3. To study the companies efforts in maintaining and motivating the advisors for retaining an existing customer and building a new customer

SCOPE OF THE STUDY

RELIANCE LIFE INSURANCE, KOPPAL

To understand the relations maintained by the Reliance Insurance Company with its customers. Ever increasing competition, low interest rates, and declining margins have driven firms to discover the customer as the basic element in their business equation Insurance as a sector has shown tremendous growth in recent years. People now are becoming more secured in terms of their life as well as their money. They want a profitable benefit out of their investment. There is a need to know the companiesâ&#x20AC;&#x2122; efforts towards convincing the customer about their product and to know how to create loyal customers. Insurance happens to be a mega opportunity in India. Itâ&#x20AC;&#x2122;s a business growing at the rate of 15-20 per cent annually and presently is of the order of Rs 450 billion.

PROFILE OF THE COMPANY

RELIANCE LIFE INSURANCE, KOPPAL

RELIANCE LIFE INSURANCE CO. LTD. Few men in history have made as dramatic a contribution to their country’s economic fortunes as did the founder of Reliance, Shri. DHIRUBHAI AMBANI. Fewer still have left behind a legacy that is more enduring and timeless. 

As with all great pioneers, there is more than one unique way of describing the true genius of DHIRUBHAI: The corporate visionary, the unmatched strategist, the proud patriot, the leader of men, the architect of India’s capital markets, the champion of shareholder interest.

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But the role Dhirubhai cherished most was perhaps that of India’s greatest wealth creator. In one lifetime, he built, starting from the proverbial scratch, India’s largest private sector enterprise.

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When Dhirubhai embarked on his first business venture, he had a seed capital of barely US$ 300 (around Rs 14,000). Over the next three and a half decades, he converted this fledgling enterprise into a Rs 60,000 crore colossus—an achievement which earned Reliance a place on the global Fortune 500 list, the first ever Indian private company to do so.

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Dhirubhai is widely regarded as the father of India’s capital markets. In 1977, when Reliance Textile Industries Limited first went public, the Indian stock market was a place patronised by a small club of elite investors which dabbled in a handful of stocks.

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Undaunted, Dhirubhai managed to convince a large number of first-time retail investors to participate in the unfolding Reliance story and put their hard-earned money in the Reliance Textile IPO, promising them, in exchange for their trust, substantial return on their investments. It was to be the start of one of great stories of mutual respect and reciprocal gain in the Indian markets.

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Under Dhirubhai extraordinary vision and leadership, Reliance scripted one of the greatest growth stories in corporate history anywhere in the world, and went on to become India’s largest private sector enterprise. 8

RELIANCE LIFE INSURANCE, KOPPAL 

Through out this amazing journey, Dhirubhai always kept the interests of the ordinary shareholder uppermost in mind, in the process making millionaires out of many of the initial investors in the Reliance stock, and creating one of the world’s largest shareholder families.

RELIANCE CAPITAL

RELIANCE LIFE INSURANCE, KOPPAL Reliance Life Insurance Company Limited is a part of Reliance Capital Ltd. of the Reliance - Anil Dhirubhai Ambani Group. Reliance Capital is one of India’s leading private sector financial services companies, and ranks among the top 3 private sector financial services and banking companies, in terms of net worth. Reliance Capital has interests in asset management and mutual funds, stock broking, life and general insurance, proprietary investments, private equity and other activities in financial services. 

Reliance Capital Limited (RCL) is a Non-Banking Financial Company (NBFC) registered with the Reserve Bank of India under section 45-IA of the Reserve Bank of India Act, 1934.

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Reliance Capital sees immense potential in the rapidly growing financial services sector in India and aims to become a dominant player in this industry and offer fully integrated financial services.

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Reliance Life Insurance is another step forward for Reliance Capital Limited to offer need based Life Insurance solutions to individuals and Corporate.

Reliance capital entered into the life insurance business by acquiring AMP Sanmar in October 2005. The business was thereafter renamed Reliance Life Insurance. Today RLIC has over 20 products - 16 individual plans and 4 employee benefit plans - including the two new innovative products – Connect to Life and Reliance Money Guarantee Plan that were launched recently. Reliance Life Insurance Company (RLIC) has been accorded the ISO 9001-2000 certificate for its best-in-class management systems in Quality, Customer & Process orientation. With this, RLIC is one of the only two life insurance companies in India to get ISO 9001:2000 certifications covering all functional areas. The scope of the certification covers the entire gamut of business processes ranging from product design, sales - front-end and back-end operations, customer care and investment, to all business support functions. The certification has been awarded by internationally 10

RELIANCE LIFE INSURANCE, KOPPAL acclaimed Bureau VERITAS and is valid till 2010 subject to continued satisfactory operation of RLIC's Quality Management System. "This certification is a significant milestone in our continuous quest to offer innovative products, outstanding services and improved customer satisfaction. It indicates that we have been able to install systems, processes & performance measures that are in line with the best in the industry and will form the basis of

our business growth in future", said P

Nandagopal, CEO, Reliance Life Insurance Company. Reliance Life Insurance is the fastest growing life insurance company in India and has an incremental market share of 4 per cent amongst private insurers. The company has third largest distribution network in terms of number of agents operating out of 143 locations across the country.

CORPORATE OBJECTIVE At Reliance Life Insurance, we strongly believe that as life is different at every stage, life insurance must offer flexibility and choice to go with that stage. We are fully prepared and committed to guide you on insurance products and services through our well-trained advisors, backed by competent marketing and customer services, in the best possible way.

CORPORATE VISION AND MISSION Vision Empowering everyone live their dreams

RELIANCE LIFE INSURANCE, KOPPAL Mission Create unmatched value for everyone through dependable, effective, transparent and profitable life insurance and pension plans.

Our Goal Reliance Life Insurance would strive hard to achieve the 3 goals mentioned below: Emerge as transnational Life Insurer of global scale and standard Create best value for Customers, Shareholders and all Stake holders Achieve impeccable reputation and credentials through best business practices

Achievements 

RLIC has been one of the fast gainers in market share in new business premium amongst the private players with an incremental market share of 4.1% in the Financial Year 2007-08 – from 3.9% in April 07 to 8% in Feb 08. ( Source: IRDA)

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Also continues to be amongst the fast growing Private Life Insurance Companies with a YOY growth of 195% in new business premium as of Mar’08.

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A Company that has crossed 1.7 Million policies in just 2 years of operation, post takes over of AMP Sanmar business.

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Initiated Express Life – an Unique ’Over the Counter’ sales process for Unit Linked Insurance Policies in the Industry.

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Accomplished a large distribution ramp-up in the Industry in a short span of time by opening 600 branches in 10 months taking the overall branch network above 740. 12

RELIANCE LIFE INSURANCE, KOPPAL 

RLIC continues to be one of the two Life Insurance companies in India to be certified ISO 9001:2000 for all the processes.

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Awarded the Jamnalal Bajaj Uchit Vyavahar Puraskar 2007- Certificate of Merit in the Financial Services category by Council for Fair Business Practices (CFBP).

PRODUCTS OFFERED BY RELIANCE LIFE Reliance has number of insurance products in it’s Portfolio. It offers different products for different customer profile. It targets its product according to the needs of people which make them its customer.

Protection Plans In today’s uncertain world, there could be calamity at every step of the life. It is up to you to ensure that your family stays protected always. Reliance Protection Plans helps you do exactly the same. You have a wide range of options to choose a plan from. Right from limited period plans to lifetime protection plans, you can opt for the one that suits your lifestyle. While we understand that nothing can compensate for the loss of a life, we intend to provide you the peace of mind. Investing in Reliance Protection Plans would mean your family’s future is in safe hands. 1.Reliance Term Plan Invest in the Reliance Term Plan, a pure life insurance plan that offers you comprehensive and affordable coverage for a limited period of time to suit your needs.

RELIANCE LIFE INSURANCE, KOPPAL 2. Reliance Simple Term Plan Make a smart investment move by investing in the cost-effective Reliance Simple Term Plan, which offers you comprehensive coverage for a specified period of time to suit your need.

3. Reliance Special Term Plan Imagine a life insurance policy, which on maturity returns to you all the premiums you had paid for your basic policy. The Reliance Special Term Plan offers that and much more.

4. Reliance Credit Guardian Plan The Reliance Credit Guardian Plan secures your family from any loan liabilities you have incurred in case of your untimely demise. On survival at maturity, you will be returned all the premiums paid for the basic policy.

5. Reliance Special Credit Guardian Plan Invest in the Reliance Special Credit Guardian Plan and protect your family from any loan liabilities you have incurred. On survival at maturity, all premiums paid for the basic policy will be returned to you.

6. Reliance Endowment Plan The Reliance Endowment Plan gives you financial independence by allowing you to decide the amount of Sum Assured based on your current financial position and expected future expensesâ&#x20AC;Ś Dream!!..

RELIANCE LIFE INSURANCE, KOPPAL 7. Reliance Special Endowment Plan Imagine an endowment plan that protects you for a certain period even after you have received your lump sumâ&#x20AC;&#x201D;that is exactly what the Reliance Special Endowment Plan offers you with other added benefits.

8. Reliance Connect 2 Life The Reliance Connect 2 Life Plan gives you the option to upgrade your life cover to keep pace with your changing lifestyle. As your income grows, your family will have sufficient cover.

9.Reliance Whole Life Plan Give your family a lifetime of timely financial support by investing in the Reliance Whole Life Plan. This will help you enjoy your life to the fullest.

10. Reliance Wealth + Health Plan Invest in the Reliance Wealth Health Plan and balance your health needs and wealth needs, without compromising on either health or wealth.

11. Reliance Cash Flow Plan Invest in the Reliance Cash Flow Plan and reap the dual benefits of a life insurance plan and easy liquidity through lump sum cash, which means you can get a percentage of the Sum Assured at periodic intervals.

Savings & Investment Plans 15

RELIANCE LIFE INSURANCE, KOPPAL In life, you have always given your family whatever they have wanted. Yet, there are some promises you have to fulfill, such as taking your family for a vacation, or buying that dream house. Set aside some money to achieve these specific goals with the help of Reliance Savings & Investment Plans. The plan allows you to experience the joys of life and provide for your familyâ&#x20AC;&#x2122;s needs. Enjoy life without worrying about the promises you have madeâ&#x20AC;&#x201D;we are here to fulfill them.

1. Reliance Super Invest Assure Plan Reliance Super Invest Assure is a complete plan which addresses your vital needs like Flexibility, Security, Investment Return and Financial Planning. With all its key benefits, it is here to ensure that there will always be more than you can ask for!

2. Total Investment Plan I - Insurance Reliance TIPS -Series I- Insurance is a Unit Linked Investment + Insurance Plan that helps you meet all your financial needs, without the complexity of managing multiple products.

3. Reliance Wealth + Health Plan Invest in the Reliance Wealth Health Plan and balance your health needs and wealth needs, without compromising on either health or wealth.

4. Reliance Automatic Investment Plan The Reliance Automatic Investment Plan is an enhanced unit linked plan that allows you

RELIANCE LIFE INSURANCE, KOPPAL to choose the right investment mix to reap maximum benefits. It also provides you with enhanced Life Cover.

5. Reliance Money Guarantee Plan To reap the benefits of a rising market and to protect yourself from any market decline, invest in the unit linked Reliance Money Guarantee plan that gives you the perfect balance between Protection and Savings.

6. Reliance Cash Flow Plan Invest in the Reliance Cash Flow Plan and reap the dual benefits of a life insurance plan and easy liquidity through lump sum cash, which means you can get a percentage of the Sum Assured at periodic intervals.

7. Reliance Market Return Plan The Reliance Market Return Plan gives you insurance protection and allows you to benefit from investment growth. It works through your life and meets the changing requirements you may have from time to time.

8. Reliance Endowment Plan The Reliance Endowment Plan gives you financial independence by allowing you to decide the amount of Sum Assured based on your current financial position and expected future expenses.

9. Reliance Special Endowment Plan Imagine an endowment plan that protects you for a certain period even after you have

RELIANCE LIFE INSURANCE, KOPPAL received your lump sumâ&#x20AC;&#x201D;that is exactly what the Reliance Special Endowment Plan offers you with other added benefits.

10. Reliance Whole Life Plan Give your family a lifetime of timely financial support by investing in the Reliance Whole Life Plan. This will help you enjoy your life to the fullest.

11. Reliance Golden Years Plan The Reliance Golden Years Plan helps you save systematically and generate the muchneeded corpus to help you enjoy life after retirement.

12. Reliance Golden Years Plan Value Realize all your dreams of playing golf, or going for a world tour after retirement by investing in the Reliance Golden Years Plan Value, which helps you generate the amount you will need for the future.

13. Reliance Golden Years Plan Plus Invest in the special Reliance Golden Years Plan Plus that not only helps you build the corpus you need after, but also collects a basic minimum amount in case something were to happen before you realize your dreams.

14. Reliance Connect 2 Life Plan The Reliance Connect 2 Life Plan gives you the option to upgrade your life cover to keep

RELIANCE LIFE INSURANCE, KOPPAL pace with your changing lifestyle. As your income grows, your family will have sufficient cover.

Retirement Plans You are a young and earning individual. The income you earn allows you to enjoy life, your only worry being whether you will be able to continue the same lifestyle after retirement. A Reliance Retirement Plan will help you save money for your retirement. It ensures that you continue to get some income after retirement thereby ensuring that you do not have to depend on any other person or make any compromises to maintain the same lifestyle. Invest in a Reliance Retirement Plan today and enjoy life after retirement on your own terms. 1. Total Investment Plan II - Pension When you invest in the Reliance Total Investment Plan, you give yourself the assurance that you will make each one of your dreams come true!.

2. Reliance Golden Years Plan The Reliance Golden Years Plan helps you save systematically and generate the muchneeded corpus to help you enjoy life after retirement.

3. Reliance Money Guarantee Plan To reap the benefits of a rising market and to protect yourself from any market decline, invest in the unit linked Reliance Money Guarantee plan that gives you the perfect balance between Protection and Savings...

RELIANCE LIFE INSURANCE, KOPPAL

Child Plans Being a parent is one of the joys of life. Your child looks up to you and depends on you for love, protection and support. You want to provide your child with the best in life. The Reliance Child Plan helps you save systematically so that you can secure your child’s future needs. Be it higher education, his or her first home or any other requirement, you will always be there for your child when he or she needs you. So, invest in a Reliance Child Plan right away—it is the best gift you could ever give your child. 1. Reliance Super Invest Assure Plan Reliance Super Invest Assure is a complete plan which addresses your vital needs like Flexibility, Security, Investment Return and Financial Planning. With all its key benefits, it is here to ensure that there will always be more than you can ask for!

2. Reliance Child Plan Save systematically and secure the financial future of your child by investing in the Reliance Child Plan and let your child enjoy today without worrying about tomorrow. 3. Reliance Secure Child Plan Reliance Life Insurance presents a unit linked insurance plan that secures your child’s financial future, leaving you free from worry.

4.Reliance Wealth + Health Plan Invest in the Reliance Wealth Health Plan and balance your health needs and wealth needs, without compromising on either health or wealth.

SOME LUCRATIVES PLANS WHICH RELIANCE OFFERS 20

RELIANCE LIFE INSURANCE, KOPPAL RELIANCE ENDOWMENT PLAN It takes a lot for a dream to become a reality. And money is surely an important part of it. Reliance Endowment Plan gives you just the financial independence to realize your dreams in the future. It lets you decide how much you would like to set as your Sum Assured based on your current financial position and your expected future expenses. So, go ahead... dream!!. Key Features 1 .On maturity receive Sum Assured plus bonuses 2. Wealth creation through bonus additions 3. More Value for your money by way of High Sum Assured Rebate 4. Choose to add the Benefit of three Riders-Reliance Term Life Insurance Benefit Rider, 5. Reliance Critical Conditions Rider and Reliance Accidental Death and Total and 6.Permanent Disablement Rider 7. Choose to avail of Policy Loan after three years CASH FLOW PLAN While most insurance plans block your money for a certain period of time, Reliance Cash Flow Plan gives you the double benefit of life insurance along with easy liquidity through lump sum cash. It provides money periodically when you need it. It lets you live life to the fullest today and at the same time, helps you stay protected for tomorrow by giving you the flexibility of receiving a specified percentage of the Sum Assured at specified intervals Key Features Easy Liquidity - Get periodic cash flows at the end of the fourth year and thereafter at the end of every three years 21

RELIANCE LIFE INSURANCE, KOPPAL Wealth creation through bonus additions On maturity, accumulated bonuses along lump sum payout receive with final More value for your money by way of High Sum Assured Rebate Full Sum Assured plus bonuses in case of your unfortunate death, this is over and above the Survival Benefits already paid Option to add two Riders - Critical Illness Rider & Accidental Death Benefit and Total and Permanent Disablement Rider

RELIANCE HEALTH + WEALTH PLAN UNDER THIS PLAN THE INVESTMENT RISK IN THE INVESTMENT PORTFOLIO IS BORNE BY THE POLICYHOLDER. There are times when late working hours take precedence over your health check-ups. And there are times when a visit to the doctor seems more important than dividends on your shares. In the rat race to make money, we often forget to take care of ourselves. We understand this predicament. Here is a plan that will ensure that your wealth keeps increasing constantly and yet your health does not take a backseat. The Reliance Wealth+Health Plan. A plan that gives you the benefits of wealth bhi. health bhi Life changes. And as it does, so do your priorities. After all, the circumstances of your life can determine the type of health coverage you need. India has made rapid strides in the health sector. Since Independence, life expectancy has gone up markedly and survival rates have also increased, still critical health issues remain. Infectious diseases continue to claim a large number of lives. Perhaps you're a freshly minted graduate, a joyful newlywed, retiring early or between jobs. Maybe you're running your own business or raising a family â&#x20AC;&#x201D; or both. In any of

RELIANCE LIFE INSURANCE, KOPPAL the situations, GOOD or BAD, health cannot be taken for granted. All are affected by the rising costs of medical expenses. That’s why it is important to plan early and in advance. Reliance Wealth + Health Plan, a health insurance plan underwritten by Reliance Life Insurance Company Limited, is designed to work in conjunction with contributions towards savings. The uniqueness of this plan is that it not only provides benefits for covered injuries but also for other injuries by encashment from the unit fund. This plan from Reliance Life offers the Hospitalization and Surgical Benefits and also covers Critical Illnesses. In short this plan provides you with a personalized quality health cover that fits your lifestyle. Key Feature A Unit Linked plan with Unique Savings Component Twin benefit of market linked return and health protection Choose from two different plan options Flexibility to take care of your family’s health Flexibility to switch between funds / plan options Option to pay Top-ups Option to package with multiple riders Liquidity through partial withdrawals

RELIANCE SUPERINVESTASSURE PLAN UNDER THIS PLAN THE INVESTMENT RISK IN THE INVESTMENT PORTFOLIO IS BORNE BY THE POLICYHOLDER. You have always aspired for the best in life. And we help you achieve that.

RELIANCE LIFE INSURANCE, KOPPAL Here’s a unique plan which combines protection and savings. It also offers complete flexibility to gain control over your investments vis-à-vis your financial needs and risk appetite. We value your regular investments and thus reward you with guaranteed additions thus promising unmatched benefits. This plan also offers you a unique option of moving from a conservative fund to an aggressive fund systematically, to take advantage of the Rupee cost averaging model. A plan that promises you, what you ought to deserve as you reach greater heights in life. What more can you ask for except gifting yourself with Reliance Super Invest Assure Plan Key features – Reliance Super InvestAssure Plan Twin benefit of market linked return and insurance protection. Guaranteed additions at the rate of 50% of your first year’s basic premium at interval of every 5 years from 10th year till policy is in force Investment opportunity with flexibility -Choose from 8 pure investment fund options. Option to pay Top-up premium(s) Liquidity in the form of partial withdrawals A host of optional rider benefits to enhance protection cover.

RELAINCE AUTOMATIC INVESTMENT PLAN UNDER THIS PLAN THE INVESTMENT RISK IN THE INVESTMENT PROTFOLIO IS BORNE BY THE POLICYHOLDER Life is indeed delightful if you have the freedom to make choices. The Reliance Automatic Investment Plan gives you just that ample freedom! And we make this 24

RELIANCE LIFE INSURANCE, KOPPAL freedom more enjoyable by giving you a sense of security. Whether it’s your insurance or investments, we let you make the choice and leave the rest to us. So allow us to take over and you can be rest assured, because for us your LIFE comes FIRST… always. This plan promise enhanced Life Cover, with complete flexibility to gain control over your investments in tune with your financial needs and your risk appetite. A plan that promises you what you deserve as you reach greater heights in life. For a select few like you, the Reliance Automatic Investment Plan is an enhanced Unit Linked plan addressing comprehensive needs to strike that perfect balance of protection and Savings with full flexibility as you grow in your career. The Reliance Automatic Investment Plan gives you full flexibility to choose just the right investment mix to reap higher benefits. Key Features Two plan option to choose from Ready-made and Tailor-made Life Stage asset allocation to ensure automatic change in investment patterns, under the Ready-made Plan option Freedom to decide your own fund mix based on your risk profile under the Tailor-made Plan Allows Systematic Transfer Plan to average out the cost of unit purchased in equality Regular, limited, single premium paying options Unmatched flexibility through out ‘Exchange Option ‘ Liquidity in the form of partial withdrawal Option to avail of Accidental Death and Total & Permanent Disability and Term Insurance riders

RELIANCE LIFE INSURANCE, KOPPAL

RELAINCE TOTAL INVESTMENT PLAN SERIES -1 The journey of life, even though it may seem simple, comes with its own twists and turns, some good, some unfortunate. And along with these moments come new dreams. With every little twist, our dreams change and so do our ambitions. And most of all we desire a security that will help us follow our dreams, both financial and emotional. It is this security that Reliance Life Insurance Company Limited promises to bring to you with its Total Investment Plan Series I Insurance. To know more, read furtherâ&#x20AC;Ś We value your dreams in this journey of life. Reliance Total Investment Plan Series I -Insurance (TIPS-I -Insurance) helps you bring them to reality. Your need for investment, protection and financial liquidity keeps changing at different stages of life. The birth of a child will require you to increase your insurance cover; a marriage in the family will require additional money. We provide you that kind of flexibility which suits you best at your convenience. Similarly on a promotion you may want to increase your investments to create a large kitty for future expenses. As you progress on this ladder of life we provide you the platform to increase your investment. Usually you would require multiple financial products to meet all your needs and would have to actively manage them. However with the Reliance TIPS-I -Insurance, Unit Linked Investment + Insurance Plan you can meet all your financial needs, without the complexity of managing multiple products Key Features This is a Single Premium unit linked savings life insurance plan with options to purchase the same plan with reduced allocation charges in subsequent policy years. Since more Premium is allocated towards investment due to lower allocation charges on subsequent purchases, greater would be the returns. Purchasing the same plan in the subsequent years is an option.

RELIANCE LIFE INSURANCE, KOPPAL 1st purchase would be called as “Classic” 2nd purchase would be called as “Silver” 3rd purchase would be called as “Gold” 4th purchase would be called as “Diamond” 5th purchase would be called as “Platinum” Once you purchase the first policy there will full flexibility, as to when second and subsequent purchase can be made and how much Premium should be paid for each purchase subject to the following: The minimum Premium on each purchase should be at least Rs. 25000 for life assured aged up to 40 and Rs. 50000 for life assured aged 41 to 64. The maturity date on each purchase cannot exceed 70 years. All the polices should mature on maturity date of the first purchase. The term of the polices purchased during second, third, fourth and fifth policy years will be 9, 8, 7 and 6 respectively. New policy can be purchased only if all the previous polices are in force on the date of purchase of new policy. Plan Objective : The pace setter plan with protection to life which gives Tax benefit under Sec. 80C and Sec. 10(10D)* of Income Tax Act 1961 Investment opportunity with flexibility Life protection Control over your investments

RELIANCE LIFE INSURANCE, KOPPAL

OVERVIEW OF INSURANCE SECTOR With largest number of life insurance policies in force in the world, Insurance happens to be a mega opportunity in India. Itâ&#x20AC;&#x2122;s a business growing at the rate of 15-20 per cent annually and presently is of the order of Rs 450 billion. Together with banking services, it adds about 7 per cent to the countryâ&#x20AC;&#x2122;s GDP. Gross premium collection is nearly 2 per cent of GDP and funds available with LIC for investments are 8 per cent of GDP. Yet, nearly 80 per cent of Indian population is without life insurance cover while health insurance and non-life insurance continues to be below international standards. And this part of the population is also subject to weak social security and pension systems with hardly any old age income security. This itself is an indicator that growth potential for the insurance sector is immense. A well-developed and evolved insurance sector is needed for economic development as it provides long-term funds for infrastructure development and at the same time strengthens the risk taking ability. It is estimated that over the next ten years India would require investments of the order of one trillion US dollar. The Insurance sector, to some extent, can enable investments in infrastructure development to sustain economic growth of the country. Insurance is a federal subject in India. There are two legislations that govern the sector- The Insurance Act- 1938 and the IRDA Act- 1999. 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.

RELIANCE LIFE INSURANCE, KOPPAL Indian Insurance Industry: Insurance may be described as a social device to reduce or eliminate risk of life and property. Under the plan of insurance, a large number of people associate themselves by sharing risk, attached to individual. The risk, which can be insured against include fire, the peril of sea, death, incident, & burglary. Any risk contingent upon these may be insured against at a premium commensurate with the risk involved.

Insurance is actually a contract between 2 parties whereby one party called insurer undertakes in exchange for a fixed sum called premium to pay the other party happening of a certain event.

Insurance is a contract whereby, in return for the payment of premium by the insured, the insurers pay the financial losses suffered by the insured as a result of the occurrence of unforeseen events. With the help of Insurance, large number of people exposed to a similar risk make contributions to a common fund out of which the losses suffered by the unfortunate few, due to accidental events, are made good Potential Largely untapped market: 17% of the worldâ&#x20AC;&#x2122;s population o Nearly 80% of the Indian population is without Life, Health and Non-life insurance o Life insurance penetration is low at 4.1% in 2006-07 o Non-life penetration is even lower at 0.6% in 2006-07 o The per capita spend on life and non-life insurance is US$33.2 and US$5.2 (2006-07), respectively compared to a world average of US$330 and US$224

RELIANCE LIFE INSURANCE, KOPPAL o Strong economic growth with increase in affluence and rising risk awareness leading to rapid growth in the Insurance sector o Innovative products such as Unit Linked Insurance Policies are likely to drive future industry growth o Investment opportunities exist in both Life and Non-life segments o Total estimated investment opportunity of US$14-15 billion

STRUCTURE Indian Insurance market was opened to private & foreign investment in 1999-2000  The Indian Insurance industry consists of a total of 31 players 

Life: 1 Public sector player; 15 private players

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Non-Life: 6 public sector players; 9 private players

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Major international players like AIG, Aviva, MetLife, New York Life, Prudential, Allianz, Sun Life, Standard Life and Lombard are already present with minority stakes in joint ventures with Indian companies for both Life and Non-life segments

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Life Insurance market is still dominated by Life Insurance Corporation (LIC) - a public sector company which has 75% share of first year premium in 2006-07

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In Non-life, private sector companies (almost all are joint ventures with foreign insurers) accounted for 34% of the market in 2006 to 07.

POLICY FDI up to 26% is permitted under the automatic route subject to obtaining a license from the Insurance Regulatory and Development Authority (IRDA) Plans to increase FDI up to 49%

RELIANCE LIFE INSURANCE, KOPPAL Insurance Regulatory Development Authority (IRDA) is the regulator for the Insurance industry In a landmark move the government detariffed the General Insurance business on 1st January 2007

What is Life Insurance? Life insurance is a guarantee that your family will receive financial support, even in your absence. Put simply, life insurance provides your family with a sum of money should something happen to you. It thus permanently protects your family from financial crises. In addition to serving as a protective cover, life insurance acts as a flexible money-saving scheme, which empowers you to accumulate wealth-to buy a new car, get your children married and even retire comfortably.

Life insurance is a contract that pledges payment of an amount to the person assured (or his nominee) on the happening of the event insured against. The contract is valid for payment of the insured amount during: 

The date of maturity, or



Specified dates at periodic intervals, or



Unfortunate death, if it occurs earlier

The functions of Insurance can be bifurcated into two parts: 1. Primary Functions 2. Secondary Functions

RELIANCE LIFE INSURANCE, KOPPAL 3. Other Functions

The primary functions of insurance include the following:

Provide Protection - The primary function of insurance is to provide protection against future risk, accidents and uncertainty. Insurance cannot check the happening of the risk, but can certainly provide for the losses of risk. Insurance is actually a protection against economic loss, by sharing the risk with others.

Collective bearing of risk - Insurance is a device to share the financial loss of few among many others. Insurance is a mean by which few losses are shared among larger number of people. All the insured contribute the premiums towards a fund and out of which the persons exposed to a particular risk is paid. Assessment of risk - Insurance determines the probable volume of risk by evaluating various factors that give rise to risk. Risk is the basis for determining the premium rate also

Provide Certainty - Insurance is a device, which helps to change from uncertainty to certainty. Insurance is device whereby the uncertain risks may be made more certain. The secondary functions of insurance include the following: Prevention of Losses - Insurance cautions individuals and businessmen to adopt suitable device to prevent unfortunate consequences of risk by observing safety instructions; installation of automatic sparkler or alarm systems, etc. Prevention of losses cause lesser payment to the assured by the insurer and this will encourage for more savings by way of

RELIANCE LIFE INSURANCE, KOPPAL premium. Reduced rate of premiums stimulate for more business and better protection to the insured. Small capital to cover larger risks - Insurance relieves the businessmen from security investments, by paying small amount of premium against larger risks and uncertainty. Contributes towards the development of larger industries - Insurance provides development opportunity to those larger industries having more risks in their setting up. Even the financial institutions may be prepared to give credit to sick industrial units which have insured their assets including plant and machinery. THE OTHER FUNCTIONS OF INSURANCE INCLUDE THE FOLLOWING:

Means of savings and investment - Insurance serves as savings and investment, insurance is a compulsory way of savings and it restricts the unnecessary expenses by the insured's For the purpose of availing income-tax exemptions also, people invest in insurance. Source of earning foreign exchange - Insurance is an international business. The country can earn foreign exchange by way of issue of marine insurance policies and various other ways.

Risk Free trade - Insurance promotes exports insurance, which makes the foreign trade risk free with the help of different types of policies under marine insurance cover.

Need for Life Insurance Today, there is no shortage of investment options for a person to choose from. Modern day investments include gold, property, fixed income instruments, mutual funds and of course, life insurance. Given the plethora of choices, it becomes imperative to make the right choice when investing your hard-earned money. Life insurance is a unique

RELIANCE LIFE INSURANCE, KOPPAL investment that helps you to meet your dual needs - saving for life's important goals, and protecting your assets. LET US LOOK AT THESE UNIQUE BENEFITS OF LIFE INSURANCE IN DETAIL.

Asset Protection From an investor's point of view, an investment can play two roles - asset appreciation or asset protection. While most financial instruments have the underlying benefit of asset appreciation, life insurance is unique in that it gives the customer the reassurance of asset protection, along with a strong element of asset appreciation. The core benefit of life insurance is that the financial interests of oneâ&#x20AC;&#x2122;s family remain protected from circumstances such as loss of income due to critical illness or death of the policyholder. Simultaneously, insurance products also have a strong inbuilt wealth creation proposition. The customer therefore benefits on two counts and life insurance occupies a unique space in the landscape of investment options available to a customer.

Goal based savings Each of us has some goals in life for which we need to save. For a young, newly married couple, it could be buying a house. Once, they decide to start a family, the goal changes to planning for the education or marriage of their children. As one grows older, planning for one's retirement will begin to take precedence. Clearly, as your life stage and therefore your financial goals change, the instrument in which you invest should offer corresponding benefits pertinent to the new life stage. Life insurance is the only investment option that offers specific products tailor-made for different life stages. It thus ensures that the benefits offered to the customer reflect the needs of the customer at that particular life stage, and hence ensures that the financial goals of that life stage are met.

RELIANCE LIFE INSURANCE, KOPPAL The table below gives a general guide to the plans that are appropriate for different life stages. Life

Life Stage

Insurance

Primary Need

Product

Asset creation

Wealth creation plans

Young & Single Young &

Asset creation &

Just married

protection

Wealth creation and mortgage

protection

plans

Children's Married

Education

education,

insurance,

mortgage protection & With kids

Asset

creation wealth creation plans

and protection Middle

aged Planning

for

with grown up retirement kids Across all lifstages

asset protection Health plans

Retirement solutions & mortgage protection

Health Insurance

Insurance Life V/S Other Savings Contract of Insurance: A contract of insurance is a contract of utmost good faith technically known as uberrima fides. The doctrine of disclosing all material facts is embodied in this important principle, which applies to all forms of insurance. 35

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At the time of taking a policy, policyholder should ensure that all questions in the proposal form are correctly answered. Any misrepresentation, non-disclosure or fraud in any document leading to the acceptance of the risk would render the insurance contract null and void. Protection: Savings through life insurance guarantee full protection against risk of death of the saver. Also, in case of demise, life insurance assures payment of the entire amount assured (with bonuses wherever applicable) whereas in other savings schemes, only the amount saved (with interest) is payable. Aid to Thrift: Life insurance encourages 'thrift'. It allows long-term savings since payments can be made effortlessly because of the 'easy installment' facility built into the scheme. (Premium payment for insurance is monthly, quarterly, half yearly or yearly). For example: The Salary Saving Scheme popularly known as SSS provides a convenient method of paying premium each month by deduction from one's salary. In this case the employer directly pays the deducted premium to LIC. The Salary Saving Scheme is ideal for any institution or establishment subject to specified terms and conditions. Liquidity: In case of insurance, it is easy to acquire loans on the sole security of any policy that has acquired loan value. Besides, a life insurance policy is also generally accepted as security, even for a commercial loan. Tax Relief: Life Insurance is the best way to enjoy tax deductions on income tax and wealth tax. This is available for amounts paid by way of premium for life insurance subject to

RELIANCE LIFE INSURANCE, KOPPAL income tax rates in force. Assesses can also avail of provisions in the law for tax relief. In such cases the assured in effect pays a lower premium for insurance than otherwise.

Money When You Need It: A policy that has a suitable insurance plan or a combination of different plans can be effectively used to meet certain monetary needs that may arise from time-to-time. Children's education, start-in-life or marriage provision or even periodical needs for cash over a stretch of time can be less stressful with the help of these policies. Alternatively, policy money can be made available at the time of one's retirement from service and used for any specific purpose, such as, purchase of a house or for other investments. Also, loans are granted to policyholders for house building or for purchase of flats (subject to certain conditions).

Who Can Buy A Policy? Any person who has attained majority and is eligible to enter into a valid contract can insure himself/herself and those in whom he/she has insurable interest. Policies can also be taken, subject to certain conditions, on the life of one's spouse or children. While underwriting proposals, certain factors such as the policyholderâ&#x20AC;&#x2122;s state of health, the proponent's income and other relevant factors are considered by the Corporation.

Insurance For Women Prior to nationalization (1956), many private insurance companies would offer insurance to female lives with some extra premium or on restrictive conditions. However, after nationalization of life insurance, the terms under which life insurance is granted to female lives have been reviewed from time-to-time. 37

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At present, women who work and earn an income are treated at par with men. In other cases, a restrictive clause is imposed, only if the age of the female is up to 30 years and if she does not have an income attracting Income Tax.

Medical And Non-Medical Schemes Life insurance is normally offered after a medical examination of the life to be assured. However, to facilitate greater spread of insurance and also to avoid inconvenience, LIC has been extending insurance cover without any medical examination, subject to certain conditions. With Profit And Without Profit Plans An insurance policy can be 'with' or 'without' profit. In the former, bonuses disclosed, if any, after periodical valuations are allotted to the policy and are payable along with the contracted amount. In 'without' profit plan the contracted amount is paid without any addition. The premium rate charged for a 'with' profit policy is therefore higher than for a 'without' profit policy. Key man Insurance Key man insurance is taken by a business firm on the life of key employee(s) to protect the firm against financial losses, which may occur due to the premature demise of the Key man

PRINCIPLES OF INSURANCE

Insurance is a specialized type of contract. Apart from the usual essentials of a valid contract, insurance contracts are subject to some additional principles. These principles

RELIANCE LIFE INSURANCE, KOPPAL provide the framework within which the product and all the contracts of insurance operate.

 Principle of cooperation: A device to share risk & uncertainties collectively, one for all and all for one’’  Principle of probability: Important determinant of insurance premium, Rate of premium depends on quantum of risk & probability of risk  Principle of Insurable Interest: Interest of such a nature that the possessor would be financially injured by the occurrence of the event insured against, `` LA to be more valuable alive then dead  Principle of utmost good faith: The parties to the contract (insurer and insured) are legally bound to reveal each other all information about the subject matter, which would influence each other’s decision.  Principal of warranties: A warranty is an undertaking by assured that some conditions shall be fulfilled, or a certain thing shall be or shall not be done. A warranty may be Express or Implied  Principle of Cause Proximal: In order to make the Insurer liable for loss, such loss must have been proximately caused by the Peril insured against. E.g. ADBR.

These 6 principles are applicable to all the products, both life and Non-Life. These principles provide the framework within which the products and all the contracts of Life Insurance operate.

HISTORY OF INDIAN INSURANCE INDUSTRY 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. 39

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Tracing the developments in the Indian insurance sector reveals the 360-degree turn witnessed over a period of almost 190 years. The business of life insurance in India in its existing form started in India in the year 1818 with the establishment of the Oriental Life Insurance Company in Calcutta.

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.

The General insurance business in India, on the other hand, can trace its roots to the Triton Insurance Company Ltd., the first general insurance company established in the year 1850 in Calcutta by the British.

Some of the important milestones in the general insurance business in India are:

RELIANCE LIFE INSURANCE, KOPPAL 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 nationalized 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. Before insurance sector was opened to the private sector Life Insurance Corporation (LIC) was the only insurance company in India. After the opening up of Insurance sector in India there has been a glut of insurance companies in India. These companies have come up with innovative and flexible insurance policies to cater to varying needs of the individual. Opening up of the Insurance sector has also forced the LIC to tighten up its belt and deliver better service. All in all it has been a bonanza for the consumer. The life insurance business in India started since 1818. Till 1956, the insurance business was mixed and decentralized. In 1956, the life insurance business of all companies was nationalized and a single monolithic organization, the Life Insurance Corporation of India (LIC), was set up. The Insurance

Regulatory and

Development Authority (IRDA) Bill was passed by Indian parliament in December

RELIANCE LIFE INSURANCE, KOPPAL 1999. The IRDA become a statutory body in April 2000 and has been framing regulations and restrictions the private sector insurance companies. The insurance sector was opened up to the private sector in August 2000. Consequently, some Indian and foreign private companies have entered the insurance business. There are about 16 life insurance companies operating in the private sector in India. 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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ABOUT THE INDUSTRY: With an annual growth rate of 15-20% and the largest number of life insurance policies in force, the potential of the Indian insurance industry is huge. Total value of the Indian insurance market (2004-05) is estimated at Rs. 450 billion (US$10 billion). According to government sources, the insurance and banking services' contribution to the country's gross domestic product (GDP) is 7% out of which the gross premium collection forms a significant part. The funds available with the state-owned Life Insurance Corporation (LIC) for investments are 8% of GDP.

Till date, only 20% of the total insurable population of India is covered under various life insurance schemes, the penetration rates of health and other non-life insurances in India is also well below the international level. These facts indicate the of immense growth potential of the insurance sector.

The year 1999 saw a revolution in the Indian insurance sector, as major structural changes took place with the ending of government monopoly and the passage of the Insurance Regulatory and Development Authority (IRDA) Bill, lifting all entry restrictions for private players and allowing foreign players to enter the market with some limits on direct foreign ownership.

Though, the existing rule says that a foreign partner can hold 26% equity in an insurance company, a proposal to increase this limit to 49% is pending with the government. Since opening up of the insurance sector in 1999, foreign investments of Rs. 8.7 billion have poured into the Indian market and 21 private companies have been granted licenses.

Innovative products, smart marketing, and aggressive distribution have enabled fledgling

RELIANCE LIFE INSURANCE, KOPPAL private insurance companies to sign up Indian customers faster than anyone expected. Indians, who had always seen life insurance as a tax saving device, are now suddenly turning to the private sector and snapping up the new innovative products on offer. The life insurance industry in India grew by an impressive 36%, with premium income from new business at Rs. 253.43 billion during the fiscal year 2004-2005, braving stiff competition from private insurers. This report "Indian Insurance Industry: New Avenues for Growth 2012", finds that the market share of the state behemoth, LIC, has clocked 21.87% growth in business at Rs.197.86 billion by selling 2.4 billion new policies in 2004-05. But this was still not enough to arrest the fall in its market share, as private players grew by 129% to mop up Rs. 55.57 billion in 2004-05 from Rs. 24.29 billion in 2003-04

Though the total volume of LIC's business increased in the last fiscal year (20042005) compared to the previous one, its market share came down from 87.04 to 78.07%. The 14 private insurers increased their market share from about 13% to about 22% in a year's time. The figures for the first two months of the fiscal year 2005-06 also speak of the growing share of the private insurers. The share of LIC for this period has further come down to 75 percent, while the private players have grabbed over 24 percent. There are presently 12 general insurance companies with four public sector companies and eight private insurers. According to estimates, private insurance companies collectively have a 10% share of the non-life insurance market.

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Indian Insurance Industry Forecast (2007-2009) The market research report â&#x20AC;&#x153;Indian Insurance Industry Forecast (2007-2009)â&#x20AC;? gives an in-depth analysis of the present and future of the Indian Insurance Industry. The market research report looks in to the details as well as gives an overview of the Indian insurance market with focus on the performance of the key players.

With the initiation of the deregulation in the Indian insurance market, the monopoly of big public sector companies in life insurance as well as general (non-life insurance) market has been broken. New private players have entered the market and with their innovative approaches and better use of distribution channels and technology, they are eating in to the shares of established public sector companies in Indian Insurance Market. Since the deregulations have been put in to place, the market share of LIC has come down to 71.4% in life insurance market while the private players have captured around 17% market in the general insurance segment. It is said that, public sector insurance companies such as LIC and New India Assurance are registered impressive double-digit growths, which reflects on the overall health of the Indian insurance sector.

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Indian Insurance Sector The Insurance sector in India governed by Insurance Act, 1938, the Life Insurance Corporation Act, 1956 and General Insurance Business (Nationalization) Act, 1972, Insurance Regulatory and Development Authority (IRDA) Act, 1999 and other related Acts.

Life Insurance Corporation of India (LIC): Life Insurance Corporation of India (LIC) was formed in September, 1956 by an Act of Parliament, viz., Life Insurance Corporation Act, 1956, with capital contribution from the Government of India. Then the Finance Minister, Shri C.D. Deshmukh, while piloting the bill, outlined the objectives of LIC thus: to conduct the business with the utmost economy, in a spirit of trusteeship; to charge premium no higher than warranted by strict actuarial considerations; to invest the funds for obtaining maximum yield for the policy holders consistent with safety of the capital; to render prompt and efficient service to policy holders, thereby making insurance widely popular. Since nationalization, LIC has built up a vast network of 2,048 branches, 100 divisions and 7 zonal offices spread over the country. The Life Insurance Corporation of India 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. The Corporation has registered a joint venture company in 26th December, 2000 in Kathmandu, Nepal by the name of Life Insurance Corporation (Nepal) Limited in collaboration with Vishal Group Limited, a local industrial Group. An off-shore company L.I.C. (Mauritius) Off-shore Limited has also been set up in 2001 to tap the African insurance market.

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General Insurance: General insurance business in the country was nationalized with effect from 1st January 1973 by the General Insurance Business (Nationalization) Act, 1972. More than 100 non-life insurance companies including branches of foreign companies operating within the country were 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. with head offices at Calcutta, Bombay, New Delhi and Madras, respectively. General Insurance Corporation (GIC) which was the holding company of the four public sector general insurance companies has since been de-linked from the later and has been approved as the "Indian Reinsure" since 3rd November 2000. The share capital of GIC and that of the four companies are held by the Government of India. All the five entities are Government companies registered under the Companies Act. The general insurance business has grown in spread and volume after nationalization. The four companies have 2699 branch offices, 1360 divisional offices and 92 regional offices spread all over the country. GIC and its subsidiaries have representation either directly through branches or agencies in 16 countries and through associate/ locally incorporated subsidiary companies in 14 other countries. A whollyowned subsidiary company of GIC, i.e. Indian International Pvt Ltd. is operating in Singapore and there is a joint venture company, viz. Ken India Assurance Ltd. in Kenya. A new wholly owned subsidiary called New India International Ltd., UK has also been registered.

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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 â&#x20AC;&#x153;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 reformsâ&#x20AC;Śâ&#x20AC;?.In 1994, the committee submitted the report and some of the key recommendations included:

i) Structure: Government stake in the insurance Companies to be brought down to 50% Government should take over the holdings of GIC and its subsidiaries so that these subsidiaries can act as independent corporations. All the insurance companies should be given greater freedom to operate ii) Competition: Private Companies with a minimum paid up capital of Rs.1bn should be allowed to enter the industry No Company should deal in both Life and General Insurance through a single Entity. Foreign companies may be allowed to enter the industry in collaboration with the domestic companies. Postal Life Insurance should be allowed to operate in the rural market. Only one State Level Life Insurance Company should be allowed to operate in each state.

RELIANCE LIFE INSURANCE, KOPPAL iii) Regulatory Body: The Insurance Act should be changed. An Insurance Regulatory body should be set up. Controller of Insurance (Currently a part from the Finance Ministry) should be made independent. iv) Investments: Mandatory Investments of LIC Life Fund in government securities to be reduced from 75% to 50%. GIC and its subsidiaries are not to hold more than 5% in any company (There current holdings to be brought down to this level over a period of time)

v) Customer Service LIC should pay interest on delays in payments beyond 30 days. Insurance companies must be encouraged to set up unit linked pension plans. Computerization of operations and updating of technology to be carried out in the insurance industry. 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 crore. The committee felt the need to 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.

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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 were the launch of the IRDAâ&#x20AC;&#x2122;s 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. Duties, Powers and Functions of IRDA Section 14 IRDA Act, 1999 lays down the duties, powers and functions of IRDA 1. The Authority has the duty to regulate, promote and ensure orderly growth of the Insurance business and reinsurance business. 2. This Include a) Issue to the applicant a certificate of registration, renew, modify, Withdraw, suspend or cancel such registration b) Protection of interests of the policy holders in matter concerning assigning Of policy, nomination by policyholders, insurable interest, settlement of insurance claim, surrender value of policy and condition of contracts of insurance. c) Specifying the code of conduct and practical training For intermediary or insurance intermediaries and agents d) Specifying the code of conduct for surveyors and loss assessors e) Promoting efficiency in the conduct of insurance business

RELIANCE LIFE INSURANCE, KOPPAL f)

Promoting and regulating professional organization connected with insurance and reinsurance business.

g) Levying fees and other charges for carrying out the purposes of this act. h) Calling from information from, undertaking inspection of, conducting enquiries and investigation including audit of the insurers, intermediaries and other organization connected with the insurance business i)

Control and regulation of the rates, advantages, terms and condition

Specifying the form and manner in which books of accounts shall be maintained and statement of account shall be rendered by insurers and other intermediaries.

k) Regulating investment of funds by insurance companies. l)

Regulating maintenance of margin of solvency.

m) Adjudication of disputes between Insurers and intermediaries or insurance intermediaries. n) Supervising the functioning of the Tariff Advisory Committee. o) Specifying the % of Premium, Income of the insurer to finance schemes for promoting and regulating professional organizations Specifying the % of Life Insurance Business and general Insurance Business to be undertaken by the Insurer in the rural or social sector

Insurers Insurance industry, as on 1.4.2000, comprised mainly two players: the state insurers

Life Insurers ď&#x201A;ˇ

Life Insurance Corporation of India (LIC)

RELIANCE LIFE INSURANCE, KOPPAL General Insurers ď&#x201A;ˇ

General Insurance Corporation of India (GIC) (with effect from Dec'2000, a National Reinsure)

GIC had four subsidiary companies, namely: 1. The Oriental Insurance Company Limited 2. The New India Assurance Company Limited, 3. National Insurance Company Limited 4. United India Insurance Company Limited.

With effect from Dec'2000, these subsidiaries have been de-linked from the parent company and made as independent insurance companies.

Yr:2000-2001:

(From

2nd

April

'2000

31st

December'2001)

In the year 2000-2001, Insurance industry had 16 new entrants(private), namely:

Life Insurance: Major Players Name of Company 52

RELIANCE LIFE INSURANCE, KOPPAL Public Sector LIFE INSURANCE CORPORATION Private Sector ICICI Prudential Bajaj Allianz Birla Sun Life HDFC Standard Life Tata AIG Private Sector ICICI Lombard Bajaj Allianz IFFCO Tokio Tata AIG

IMPACT OF FOREIGN INSURERS ENTERING INDIA: ''LIBERALIZATION'' 53

RELIANCE LIFE INSURANCE, KOPPAL For a long period after Independence, Indian business was characterized by government regulations-- the ‘license raj’. The government not only exercised control over industrial growth and expansion, but also ran monopoly undertakings and took over loss-making industries on the grounds of mismanagement. Then, in 1985, the late Mr Rajiv Gandhi initiated the first set of economic reforms. After so many years of developmental effort they had not been able to eradicate poverty, remove inequalities or establish an egalitarian society. The resultant disillusionment came out in the open when the socialist economies collapsed. As the Indian economy got further integrated with the world’s, the necessity for globalization increased. This introduced a new buzzword-Liberalization. The term is used for a more ‘outward-oriented’ policy, which includes the elimination of anti-export biases, lowering high import tariffs, reducing and phasing out Quantitative Restrictions (QRs) on inputs and switching to tariff-related measures. However, the government would not completely abandon all forms of control and place the entire economy at the mercy of MNCs. Liberalization and globalization would mainly remove certain imbalances and restrictions that hamper the free flow of trade. The goals of liberalization were to motivate Indian manufacturers to prefer updated technology and to deliver the better products at lower costs. This would increase competition and provide incentives to deliver world-class goods and services at affordable prices, which leads to quality assurance.

Customer Relationship Management

RELIANCE LIFE INSURANCE, KOPPAL Customer Relationship Management focuses on acquiring, developing and creating satisfied loyal customer; achieving profitable growth; and creating economic value in company’s brand. Customer Relationship Management strives to improve the customer’s experience of how they interact with the company and produce high customer equity .the more loyal customer, the higher are the customer equity. Recently CRM has taken a center stage in the business world with businesses concentrating on saving money and increasing profits by redefining internal processes and procedures. It costs a company dramatically less to retain and grow an existing client, than it does to court new ones. It is said that “It is seven times more expensive to acquire a new customer than to keep an existing one”, therefore the value of customer information and management should never be underestimated Customer equity comprises of three drives 

Value equity



Brand equity



Relationship equity

CRM (Customer Relationship Management) is something that is not restricted to any country or culture. Wherever customers are there, business cannot afford to keep them unhappy; and that is where CRM comes in as a strong requirement. In India, the trend is positive. When compared to about twenty years ago , people have more choice and every company knows it can’t take customer for granted .May be the movement is slow ,but we see a steady progress towards an increased focus on the customer rather than merely on the products and price . Today’s era is of service because customers are ultimate base line for any business to sustain in this competitative world

RELIANCE LIFE INSURANCE, KOPPAL For example: Banks started providing ‘gold’, ‘silver’ cards to its valued customer, depending on their needs the customer get faster services. The concept of CRM is relatively simple and familiar to insurers. The two points of the concept are: 

Understand your customers' unique requirements.



Offer them the services and products over their lifetime that will maintain or increase their profitability and retain them as your customers.

These are the some supporting strategies that implement these concepts to yield significantly greater results and a true competitive advantage. These supporting strategies generally fall into three groupings: analytical, marketing and operational. The analytical path focuses on mining the data you have on your existing customers, and marrying that data with external data when possible to develop a scoring index. This index can then be reliably applied to individual customers to indicate their level of profitability, tendency to remain a customer, and propensity to acquire other products and services. The current trends in corm followed by insurance companies While the CRM market in India is still nascent, bigger players such as ICICI Prudential Life Insurance Company are adopting it in a big way. The company was earlier using Gold Mines (a sales and marketing tool) and HEAT (an operational CRM solution) from Front Range Solutions. Last year it took a decision to invest in CM3 from Tera data and SAS’s statistical tool for BI. Anil Tikoo, head-IT at ICICI Prudential Life Insurance Company says, “As a forward looking company, we see CRM playing a significant role in acquiring new customers. CRM lets us obtain granular details about our customers, helping us to design better products, improve service levels and reduce operational costs.” CRM has helped ICICI Prudential Life capture five lack customers through effective event-based marketing and lead tracking to cross- and up-sell products.

Business drivers for CRM

RELIANCE LIFE INSURANCE, KOPPAL Margins are under pressure: A couple of years ago, LIC dominated the insurance market with the help of its sales force and channels and margins were reasonably high. Today, there are close to 20 companies offering both life and general insurance products. All of them have equally strong international and local partners; all are focusing upon similar geographies and target audiences. The new firms selling life insurance and nonlife insurance [pensions, insurance as saving, etc] have failed to emulate the LIC model because margins are getting squeezed. There are several pain areas that new insurance firms face—acquiring new customers, retaining them, cross-selling products and controlling rising costs while providing comprehensive support. Insurers have added a variety of products and services to their kitty. These range from insurance as an investment option to pension plans. They target the younger generation in the 20 to 30 years age group. “The convergence of four factors—protection, saving (investment option), loans and pension—have compelled insurance companies to align with banks in reaching out to a larger audience,” says Tikoo. This trend has led to another—insurance companies are joining hands with banks by becoming channel partners for insurance. Tata AIG has a marketing alliance with HSBC, Birla Sun Life has one with Citibank and IDBI and LIC ally with Corporation Bank, while Kotak Life Insurance has an arrangement with Kotak Bank. This strategy helps insurance firms increase their footprint to cover a larger part of the customer base in the 20-30 years demographic. CRM helps connect a bank’s high net worth customers with insurance firms.

RELIANCE LIFE INSURANCE, KOPPAL

Where to begin—operational CRM or analytical CRM? The choice between operational and analytical CRM as a starting point depends upon the insurer’s needs. Gartner says that insurance companies with multiple financial products and a big customer base, such as integrated insurance solution providers, will leverage their customer base to cross- and up-sell different financial products, including insurance. Such providers will benefit from adopting analytical CRM. Market segmentation, campaign management and data mining applications will benefit them in many ways. 

Call center text mining: This tool can help improve the customer experience by resolving complaints rapidly. Insurers are using these tools to mine text from call center transcripts to identify issues faced by customers. Text mining tools also help detect and capture other useful pieces of information around a customer’s life stage, financial needs and product interests. These can be used to generate leads and trigger cross-selling. However, to be fully effective, customer service representatives must be trained to probe for information that will help in cross selling during the text-mining phase. Text mining tools are leading edge today, but are predicted to take off quickly.



Event-triggering and profiling: “Insurers can use event triggers to generate leads that can be acted upon quickly, usually within 24 hours,” says Tikoo. Eventtriggering tools monitor incoming transaction and contact data in near-real-time to recognize changes in a customer’s behavior or profile to trigger actions or alerts.

Lead management gets sophisticated: Often the ability of an insurer to generate leads by means of event-triggering, re-engineered touch points and cross line-of-business referral can outstrip their ability to manage said leads. In such a situation, though the number of leads generated rises, the conversion rate does not. It may even drop. CRM can help provide sales representatives with a mechanism to prioritize and manage leads.

RELIANCE LIFE INSURANCE, KOPPAL

Changing customer behavior in insurance buying In insurance buying, most customers would probably describe their level of understanding of insurance contracts in the above manner. Customers know generally what a policy covers; they also know that there are several fine prints in insurance contracts, which they do not know, or perhaps care to know, at the time of buying. And they also seem to generally conclude that when it comes to making a claim under an insurance policy, there could be several issues of which they are just unaware at the time of buying the policy in the first place.

Changing expectations A remarkable trend in the insurance industry in the last three years is the rapid change in the knowledge level as well as expectations of the customers. A study conducted last year by Forte, a collaborative effort between FICCI and ING Vysya Insurance Co. about the consumer behavior in the pre and post liberalization days of the industry had revealed stunning changes in consumer expectations. It looks as though the docile, uninformed, insurance consumer has suddenly been transformed into an aggressive and highly demanding species. While the fresh air of competition in every sector of the economy brings in major changes in consumer expectations (witness the sea change in the attitude of automobile buyers in India in the last five years), the insurance industry has witnessed a few unique aspects, such as regulation-inspired efforts to educate insurance buyers, and a vast change in the skills and capabilities of the intermediaries involved in distribution.

Motivating factors In respect of life insurance, potential buyers are driven to buying a policy for one or more of three major reasons: security of the money invested, saving for one or more 59

RELIANCE LIFE INSURANCE, KOPPAL specific purposes, and the availability of tax benefit. Customers are increasingly known to place less reliance on the tax benefit factor, and stress more on the security aspect and the end-use objective. The challenge of the insurance companies is to address the motivating factors imaginatively and come up with genuine solutions. Take for example, the consumerâ&#x20AC;&#x2122;s objective of taking a policy to save money for higher education of a child. This has been a driving force in the sale of new insurance contracts in several other countries too, notably in Asia. A potential buyer primarily expects that the saving should be a painless process and that the money saved should be absolutely safe. The challenge is to provide not only convenient payment options, but also mechanisms that could offer some measure of protection and relief to the customer if he is forced to disrupt the payment arrangement for unforeseen reasons. On the issue of the consumersâ&#x20AC;&#x2122; perception of security of the money invested, there are two important aspects. One is how the features of the insurance contract are put across to the buyer (whether it is a unit-linked policy or endowment oriented). The second is how to address more effectively the question about the dependability of the new generation companies that potential new insurance buyers raise during sales calls especially outside metros and in small towns (referred to in publicity jargon as buyers in the SEC B and C categories). Both insurance companies and the Regulator need to address this behavioral challenge more actively.

Consumerâ&#x20AC;&#x2122;s experience There has been a vast change in the approach of the insurance agent from the preliberalization days. While the agent in the past established informal contacts with potential buyers and often depended on referrals from friends and family members, the new age companies insist on a professional, and often aggressive stance on the part of the 60

RELIANCE LIFE INSURANCE, KOPPAL sales staff. Customer expectations in this regard revolve around two key aspects: first, whether the customer is getting truthful advice from the agent, or if he is pushing a product that yields him the highest commission rate. Invariably, the customers today expect the insurance agent (and other intermediaries such as the banc assurance sales staff) to provide a ready comparison of competitorsâ&#x20AC;&#x2122; products and how the product the agent is suggesting is superior to the others. How far is the need-based analysis of insurance requirement, that the new age sales staff are trained to offer, found to be relevant and useful to potential insurance buyers? The answer varies from the metro cities and small towns. However outside metro cities, customers tend to take a clear view that saving-oriented policies are more needed. There is also marked reluctance to disclose the true personal financial status and the corresponding insurance needs to insurance salespersons. The second aspect of customersâ&#x20AC;&#x2122; perception about the new generation of insurance agents is the level of continuing commitment of the agent to arrange post-sale service. Potential insurance buyers are unsure that they would continue to deal with the same agent who sold the policy throughout the term. They would tend to place more reliance on the companyâ&#x20AC;&#x2122;s general promises of service and commitment. This is an important message for the insurance companies. As insurance customers increasingly make arrangements to pay periodical premiums directly through the electronic medium, or though automatic transfers from their bank accounts, thereby bypassing the need for regular post-sale service by the agents, customers would tend to place more reliance on the direct standard of service from the company concerned. Instances of customers requiring agents to arrange for loans against their policies, or change nominations etc. are rare. Therefore companies need to gear themselves to provide high service standards directly.

RELIANCE LIFE INSURANCE, KOPPAL

Premium shopping Is pricing or the premium rate for a policy, a deciding factor for buying insurance? It is indeed so in a price sensitive market such as ours. In several forums, customers have voiced the general feeling that as insurance products become more complex, and they get bundled with several riders, it is becoming impossible to make price comparisons between different companies. An increasingly larger segment of customers now questions why the premium rate should be the same for a policy if bought direct from the company over Internet, or through a channel considered simpler, such as the banc assurance channel. There is logic in the insurance companies passing on the cost saving to customers in such cases. It is time the Regulator seriously considered the customer expectations of differential premium rates for the same policy bought through different channels and allowed the practice. It should therefore be conceivable to offer premium rebate to insurance buyers who consciously decide to approach the company directly for buying a policy (after presumably taking the trouble of educating themselves about the product features and other aspects), and choose to deal with the company directly for future servicing needs.

High expectations One aspect of customer service from new age insurance companies that a remains to be tested widely is the claim payment record. While consumers seem to be satisfied that the survival benefits under a life insurance policy would get paid rather promptly from the tech-savvy new companies, obviating the need for interlocution by the insurance agent, insurance buyers are not yet convinced about hassle-free payment in the event of a

RELIANCE LIFE INSURANCE, KOPPAL claim, whether under a life policy or a general insurance policy. This is especially so in respect of rider benefits such as critical illness or hospitalization benefits. The level of consumer skepticism on claim payment is markedly high in respect of non-life insurance products, such as Householdersâ&#x20AC;&#x2122; Package or Medicaid policies. There is considerable work to be done to boost the level of confidence both by insurance companies and the Regulator. By the time a company completes the development of a strategy and makes investments to pursue the strategy, the opportunity often ceases to exist. It is therefore important that the new age insurance companies become â&#x20AC;&#x2DC;kineticâ&#x20AC;&#x2122; enterprises, which can take advantage of unpredictable customer demands and unexpected market events immediately. This is vastly relevant for the Indian market where the insurance consumers are rapidly coming of age.

RELIANCE LIFE INSURANCE, KOPPAL

RESEARCH METHODOLOGY The research based will be Descriptive Research. Type of data 1.Primary data 2.Secondary data Primary data The primary or the first hand data will be collected with the help of handing out the questionnaire to the customers &employees. Secondary data The major source of secondary or supporting data will be internet . Using this data measurement technique, information was collected by personal interviews. Secondary data was collected through company websites, discussions with company guide. The collected data was processed through S.P.S.S. Package.

Sampling Design The research was mainly opted on customer’s survey, adviser’s survey as well as sales officer’s survey. The sample selected for survey was stratified sample. Sample size is 50 Customers, 10 Sales officers and 50 advisers.

RELIANCE LIFE INSURANCE, KOPPAL

Sample Character Respondents are sales officers, and existing customers of reliance insurance and the advisers..

Sampling Plan For Customers Sampling unit

: Individuals.

Sampling Method

: Non Probability, Convenience Sampling.

Sampling Size

: 50 Customers.

For sales officers Sampling unit

: 10 Sales officers

For Advisers Sampling unit

: Advisors .

Sampling Method

: Non Probability, Convenience Sampling

Sampling Size

: 50 Advisers.

Sampling Plan

: Questionnaires.

Sample Area

: KOPPAL

RELIANCE LIFE INSURANCE, KOPPAL

Tools and Technique of Data Collection Personal Interviews Where customers, sales officers and advisers were interviewed personally that face to face interaction were done.

Questionnaire: It is a systematic designed questionnaire is used for collecting primary data. These data are used for further descriptive research.

RELIANCE LIFE INSURANCE, KOPPAL Table 1: Do you agree that reliance insurance variety of products. Frequency 30 17 3 50

strongly agree agree normal Total

Percent 60.0 34.0 6.0 100.0

Valid Percent 60.0 34.0 6.0 100.0

Cumulative Percent 60.0 94.0 100.0

Figure: 1 Do you agree that reliance insurance variety of products

normal 6.0%

Findings From the 50 respondents surveyed

agree 34.0% strongly agree 60.0%

60% Customers are strongly agreed that Reliance have variety of products.

34% Customers are agree that reliance has variety of products. 6% Customers feel that Reliance has Neutral of products. Table No: 2. Did you get sufficient information about the product while purchasing

RELIANCE LIFE INSURANCE, KOPPAL

yes no Total

Frequency 37 13 50

Percent 74.0 26.0 100.0

Valid Percent 74.0 26.0 100.0

Cumulative Percent 74.0 100.0

Figure: 2. Did you get sufficient information about the product while purchasing

no 26.0%

yes 74.0%

Findings From the 50 respondents surveyed 74% respondents say that they got sufficient information about product while purchasing. 26% respondents say that they did not got sufficient information about product while purchasing

Table: 3. If no the Reasons are

RELIANCE LIFE INSURANCE, KOPPAL

complexity of products less information given by advisor/sales officer Total

Frequenc y 12

Percent 24.0

Valid Percent 57.1

Cumulative Percent 57.1

18.0

42.9

100.0

42.0

100.0

Figure: 3. If no the Reasons are

less information g iv 18.0%

M issing 58.0% complexity of produc 24.0%

Findings From the 50 respondents surveyed 24% respondents say that because complexity of the product 18% respondents say that less information given

Table: 4. Does your need and product are matching 69

RELIANCE LIFE INSURANCE, KOPPAL

Frequency fully matched 27 partly matched 20 normal 3 Total 50

Figure: 4

Percent 54.0 40.0 6.0 100.0

Valid Percent 54.0 40.0 6.0 100.0

Cumulative Percent 54.0 94.0 100.0

Does your need and product are matching

normal 6.0%

partly matched fully matched

40.0%

54.0%

Findings From the 50 respondents surveyed 54% respondents say that, their need and product fully matched 40% respondents say that, their need and product partly matched 6% respondents say that their need and product are neutral Table: 5.

RELIANCE LIFE INSURANCE, KOPPAL how much are you motivated by advisor ?(advisor) * how much are you motivated by sales officer?(sales officer)) Crosstabulation Count

how much are you motivated by advisor ?(advisor)

highly motivated motivated not at all

Total

how much are you motivated by sales officer?(sales officer)) highly motivated motivated 15 4 19 6 3 3 37 13

Total 19 25 6 50

Figure: 5. cross tabs 20 19

Count

how much are y ou mot

4 3

highly motivated motivated

highly motivated

motivated

not at all

how much are y ou motiv ated by advisor ?(adv is or)

Out of the total sample most of the customer are highly motivated by the sales officer

RELIANCE LIFE INSURANCE, KOPPAL Table 6: Which are the services you receive from the advisor

Frequency information of premium date reminding information of new policies help in solving the doubts Total

Percent

Valid Percent

Cumulative Percent

54.0

34.0

88.0

6 50

12.0 100.0

100.0

Figure: 6. Which are the services you receive from the advisor

help in solving the 12.0%

information of premi information of new p

54.0%

34.0%

Findings From the 50 respondents surveyed 54% respondents say that they got information about the premium

RELIANCE LIFE INSURANCE, KOPPAL 34% respondents say that their need and product partly matched 12% respondents say that their need and product are neutral Table: 7. Have you tried to understand needs of the customers

yes no Total

Frequency 31 19 50

Percent 62.0 38.0 100.0

Valid Percent 62.0 38.0 100.0

Cumulative Percent 62.0 100.0

Figure: 7. Have you tried to understand needs of the customers

Findings

no 38.0%

From the 50 yes 62.0%

respondents surveyed 62% Advisor say that they tried to understand needs of the customers

38% advisor say that they donâ&#x20AC;&#x2122;t try to understand needs of the customers Table: 8. How many times you have contacted the existing customer

RELIANCE LIFE INSURANCE, KOPPAL

once in week once in month once in 6 months once in a year Total

Frequency 7 15 18 10 50

Percent 14.0 30.0 36.0 20.0 100.0

Valid Percent 14.0 30.0 36.0 20.0 100.0

Cumulative Percent 14.0 44.0 80.0 100.0

Figure: 8. How many times you have contacted the existing customer

once in week once in a year

14.0%

20.0%

once in month 30.0% once in 6 months 36.0%

Findings From the 50 respondents surveyed 36% Advisor say that they have contacted the customers once in 6 months 30% advisor says that they try to contact once in a month to customer 20% Advisor say that they have contacted once in a year to customers 14% advisor says that they have contacted customers once in a week. Table: 9. Do you prepare yourself for any sales call

RELIANCE LIFE INSURANCE, KOPPAL

yes no Total

Frequency 29 21 50

Percent 58.0 42.0 100.0

Valid Percent 58.0 42.0 100.0

Cumulative Percent 58.0 100.0

Figure: 9. Do you prepare yourself for any sales call

no 42.0%

yes 58.0%

Findings From the 50 respondents surveyed 58% Advisor says that they prepare for sales call 42% advisor says that they donâ&#x20AC;&#x2122;t prepare for sales call

Table: 10 What kind of assistance do you need to generate more business

RELIANCE LIFE INSURANCE, KOPPAL

Frequency Training about customer handling Helpdesk at the branch Generating leads by the company Total

Percent

Valid Percent

Cumulative Percent

52.0

32.0

84.0

16.0

100.0

Figure: 10.What kind of assistance do you need to generate more business

Generating leads by 16.0%

Training about custo 52.0% Helpdesk at the bran 32.0%

Findings From the 50 respondents surveyed 52% Advisor says that they want training about customer handling 32% advisor says that they want help desk at the branch 16% advisor says that they want generating leads by the company

Table: 11. Extent of advisor satisfaction in RIL with Monetary 76

RELIANCE LIFE INSURANCE, KOPPAL

H.satisfied satisfied Total

Frequency 7 3 10

Percent 70.0 30.0 100.0

Valid Percent 70.0 30.0 100.0

Cumulative Percent 70.0 100.0

Figure: 11. Extent of advisor satisfaction in RLIC with Monetary

satisfied 30.0%

H.satisfied 70.0%

Findings 70% of the advisors are highly satisfied with monetary benefits, and 30% of the advisors are satisfied with monetary benefits.

Table: 12. Extent of advisor satisfaction in RIL with rewards

RELIANCE LIFE INSURANCE, KOPPAL

Frequency 3 5 2 10

H.satisfied satisfied neutral Total

Percent 30.0 50.0 20.0 100.0

Valid Percent 30.0 50.0 20.0 100.0

Cumulative Percent 30.0 80.0 100.0

Figure: 12 Extent of advisor satisfaction in RIL with rewards

neutral 20.0%

H.satisfied 30.0%

satisfied 50.0%

Findings 30% of the advisors are highly satisfied with the rewards. 50% of the advisors are satisfied with the rewards, and 20% of the advisors are feeling normal about the Rewards

Table: 13. Extent of advisor satisfaction in RIL with recognition 78

RELIANCE LIFE INSURANCE, KOPPAL

H.satisfied satisfied neutral Total

Frequency 4 4 2 10

Percent 40.0 40.0 20.0 100.0

Valid Percent 40.0 40.0 20.0 100.0

Cumulative Percent 40.0 80.0 100.0

Figure: 13. Extent of advisor satisfaction in RIL with recognition

neutral 20.0% H.satisfied 40.0%

satisfied 40.0%

Findings 40% of the advisors are highly satisfied with the recognition 40% of the advisors are satisfied with the recognition. 20% advisors are feeling normal about the recognition.

Table: 14 Do you find difficulty in handling advisers

RELIANCE LIFE INSURANCE, KOPPAL

Frequency 6 4 10

yes NO Total

Percent 60.0 40.0 100.0

Valid Percent 60.0 40.0 100.0

Cumulative Percent 60.0 100.0

Figure: 14 Do you find difficulty in handling advisers

NO 40.0% yes 60.0%

Findings The sales officer found about 60% difficulty in handling the advisor The sales officer found about 40% No difficulty in handling the advisor

RELIANCE LIFE INSURANCE, KOPPAL Table: 15. What kind of assistance do you need to generate more business Frequency presentation by the insurance comapny briefing by managers helpdesk at the branch meeting with advisers Total

Percent

Valid Percent

Cumulative Percent

10.0

2 2 5 10

20.0 20.0 50.0 100.0

30.0 50.0 100.0

Figure: 15. What kind of assistance do you need to generate more business

presentation by the 10.0%

briefing by managers 20.0% meeting with adviser 50.0%

helpdesk at the bran 20.0%

Findings 50% sales officers feel that generating business can be done through meeting with advisor 50% sales officers feel that generating business can be done through help desk at the branch 20% sales officers feel that managers can do generating business through briefing 10% sales officers feel that managers can do generating business through presentation

RELIANCE LIFE INSURANCE, KOPPAL

FINDINGS 1. Even though the sales officers and advisors provide sufficient information to customers, while selling the product 26% of the total customers feel that they had not received sufficient information. Provided was complex, rest of the respondents feel that the information provided was less. 2. Found that Reliance Life Insurance has large variety of products in its portfolio, it is observed that 37% of the customer feel that the product purchased by most the customer and their need are not matching. 3. As compared to the Advisors, Sales people perform more than advisors. In instance sales people have motivated the most of the customers to purchase the product. 4. The male were the dominating category in advisors 5. Due to lack of the effective training, most of the advisors were not able to handle the customer properly, and may not solve the customerâ&#x20AC;&#x2122;s queries. 6. There are not satisfactory visits made by the advisors to the customerâ&#x20AC;&#x2122;s doorstep. Only 14% of the advisors have been visiting the customer at their doorstep at once a week. So that they can find the need in the existing customers or can be able to build a new customer for the Reliance Life Insurance 7. Most of the advisors do not prepare themselves for the sales call; in turn they may not perform better at the call of the customer. 8. To generate more business, most the Sales officers feel that there should be a meeting to be kept with the advisors. 9. The services provided by advisor to the customer are most of about 54% of the customer receive information of premium date reminding, while 34% receive information of new policies and 12% of customer get service of solving the doubts.

RELIANCE LIFE INSURANCE, KOPPAL 10. 62% of the advisors have tried to understand the customerâ&#x20AC;&#x2122;s needs, which in-turn will help in suggesting a suitable product to the customer. But 38% of the advisors havenâ&#x20AC;&#x2122;t tried in understanding the customer needs. 11. About 32% of the advisors feel that the company should provide help desk at the branch. And 16% of the advisors feel generating leads by the company is necessary for generating more business. 12. 70% of the advisors are highly satisfied with monetary benefits, and only 30% of the advisors are satisfied with monetary benefits. 13. 30% of the advisors are highly satisfied with the rewards. 50% of the advisors are satisfied with the rewards, and 20% advisor are feeling normal about the Rewards 14.40% of the advisors are highly satisfied with the recognition, about 40% of the advisors are satisfied with the recognition, and 20% advisor are feeling normal about the recognition.

15. The advisors who are working with the Reliance Life Insurance fall under the age group between, 25 to 30 Years. Most of the advisors are young.

RELIANCE LIFE INSURANCE, KOPPAL

Limitations of the study

The present study is undertaken in KOPPAL city and data is collected from the respondents for the year 2009-10. Hence, data pertained to the study is too short and brief for generalization. Hence, it would be difficult to draw precise generalizations regarding the implications of the study. The findings in the study, interpretations and conclusions drawn could be best seen within these limitations.

RELIANCE LIFE INSURANCE, KOPPAL

EXPECTED CONTRIBUTION FROM THE STUDY

 As the number of visits made by the advisors to the customers is less than 56%, and the relation can be build/maintained by effective communication with the customers by being in constant touch with the customer. As many of the new life insurance companies are entering, Reliance has to maintain its relation with the customer. So that it can be abele to generate more number of loyal customers.

 To educate the customers about the new products, the company can use SMS service for reaching its customers. Due to large number of customers, the reach of the entire customers in less time may not be possible from its advisors and sales officers. This can be a less costly medium of taking direct response of the customers. As it does not disturb the customer.

 To effective closing of any sales call, one should understand the need of the customers in depth. The Advisors can be trained by the sales officers, and training institution.

 The Reliance should come up with more number of Products for those customers about 40% of customer are feeling that the product that they purchased. does not match there needs

This research has been brought up many facts regarding the Customer relationship Management. Reliance Life insurance has large number of products in its portfolio. But the advisors are unable to find out the need of the customers and they are unable to suggest the right suitable product. By this project, now I can understand the various factors of insurance industry and how the customer relation is maintained in this industry. 85

RELIANCE LIFE INSURANCE, KOPPAL The potential customers are more in number and they are still not secured their life. Due to distribution channels, to reach every other customer in shortest time is not possible; hence company can adopt some of the suggestions

RELIANCE LIFE INSURANCE, KOPPAL Questionnaire For Customers Dear Sir/Madam, I am pleased to introduce myself K Sunil Chowadari, MBA Student of HET’s Institute of Management Studies Hubli as a Part of Curriculum, have undertaken a study on, “Customer Relationship Management in Reliance Life Insurance”. The information provided by you will be strictly kept confidential and used for academic purpose only

1. Name: 2. Age: 3. Sex: 4. Income:

5. Do you agree that Reliance life insurance offers variety of products? Strongly Agree Agree

Normal

Disagree

Strongly Disagree

6. Did you got sufficient information about products while purchasing? a) Yes

b) No

7. If No, the reasons are: 

Complexity of products



Less information given by the adviser/sales officer



Any others (specify)

RELIANCE LIFE INSURANCE, KOPPAL 8. Does your need and the product you purchased are matching? Fully matched Partly matched

Normal

Partly not matched Not matched

9. How much are you motivated by the adviser or sales officer? Highly motivated

Adviser

motivated

Highly motivated

Sales Officer

Not at all

motivated

Not at all

10.Which are the services you receive from the advisor?  Information of premium date reminding  Information of new policies.  Helps in solving the doubts.  If any mention __________________________

11. Suggest any unique service you want from the organization? __________________________ Thank You

RELIANCE LIFE INSURANCE, KOPPAL QUESTIONNAIRE FOR SALES OFFICERS

1. Name: 2. Designation: 3. Do you agree that Reliance life insurance has variety of products? Yes

4. Do you educate the advisers about initiating Reliance products? Yes

5. If No, the reasons are: 

Lack of information about the same,



Lack of time



Lack of motivation from Reliance Life Insurance



Lack of interest in the Advisers,



Any others (specify)

6. Are you aware of the various incentives available for following leads given by advisers? Yes

7. What are the advisors satisfied with? H Satisfied

Satisfied

Monetary Rewards Recognition

Neutral

Dissatisfied

H Dissatisfied

RELIANCE LIFE INSURANCE, KOPPAL 8. How many advisers are there in you’re under? _______

9. Do you find difficulty in handling advisers? Yes

10. If yes then what type of difficulty you face? _____________

11. Are you given sufficient information / training to help you clear the advisers queries regarding insurance plans? Yes

12. What kind of assistance do you need to generate more business? 

Presentation by the insurance company



Briefing by managers



Helpdesk at the branch



Meeting with advisers

Thank You

QUESTIONNAIRE FOR ADVISERS

RELIANCE LIFE INSURANCE, KOPPAL

1. Name: 2. Age: 3. Sex: 4. Qualification: 5. Do you agree that Reliance life insurance has variety of products? Strongly Agree Agree

Normal

Disagree

Strongly Disagree

6. Do you get sufficient information about products? Yes

If No, the reasons are:  Lack of interest in yourself  Lack of Training  Lack of motivation from Reliance Life Insurance  Any others (specify) 7. Do you educate customers about Reliance Life Insurance Products? _______ 8. Have you tried to understand the needs of the customer? Yes

9. If no then what type of difficulty you face? 91

RELIANCE LIFE INSURANCE, KOPPAL _____________

10. Have you given sufficient information / training to help you clear the customers queries regarding insurance plans? Yes

11. How many times you have contacted the existing customer? Once in weak

Once in month

Once in 6 months

Once in Year

12. Do you prepare yourself for any sales call? Yes

13. What kind of assistance do you need to generate more business?  Training about customer handling  Helpdesk at the branch,  Generating leads by the company  Any others (specify)

Thank You.

RELIANCE LIFE INSURANCE, KOPPAL

BIBLIOGRAPHY Textbooks: 1. Marketing Management: 13th Edition A South Asian Perspective Philip Kotler, Kevin Lane Keller, Abraham Koshy, Mithileshwar Jha 2. Marketing Management Arun Kumar, N Meenakshi

Websites:

www.reliancelife.co.in www.licindia.com

Newspaper:

Business Line