Professional Documents
Culture Documents
BAJAJ-ALLIANZ
WITH LIC & ICICI PRUDENTIAL
PROJECT REPORT
2011
SUBMITTED BY
PUNEET GUPTA
In the partial fulfillment of the requirement of
Master of Business Administration (2010-2012)
ACKNOWLEDGEMENT
At the outset, I would like to express my deep sense of gratitude and sincere
thanks to Prof. S.K Nayak, Principal, T.JOHN Business School Bangalore,
for providing an opportunity to discover the corporate world, froma close
perspective.
Once again Prof. S.K Nayak, My Principal and internal guide for this project to
whom I am deeply grateful for his constant support and guidance without which
it would not have been possible for me to complete this project in time.
I take this opportunity to extend my sincere gratitude to Mr. Vishwamitra
Verma (Sales Manager), for giving me an opportunity to undertake internship
training and the project on the topic Organization Study.
I extend my sincere gratitude to Mr. Shyam Lal Pandey for his directions,
suggestions and information provided which were of utmost importance for the
successful completion of the project.
I convey my gratitude to all the staff members of Bajaj Allianz Life Insurance
Co. Ltd, for their kind co-operation and guidance through out my project.
INDEX
1
INTRODUCTION
History of Insurance
2
3
4
5
6
7
8
9
10
5
7
Types of Insurance
12
18
21
IRDA
29
COMPANY PROFILES
Bajaj Allianz
35
44
ICICI Prudential
50
COMPARATIVE STUDY
59
60
61
RESEARCH METHODOLOGY
71
ANALYSIS
75
FINDINGS
82
CONCLUSION
84
RECOMMENDATIONS
85
BIBLIOGRAPHY
87
INTRODUCTION
the other party called insured a fixed amount of money on the happening
of a certain event."
Insurance is a protection against financial loss arising on the happening
of an unexpected event. Insurance companies collect premiums to
provide for this protection. A loss is paid out of the premiums collected
from the insuring public and the Insurance Companies act as trustees to
the amount collected.
For example, in a Life Policy, by paying a premium to the Insurer, the
family of the insured person receives a fixed compensation on the death
of the insured. It is a system by which the losses suffered by a few are
spread over many, exposed to similar risks. Insurance is desired to
safeguard oneself and one's family against possible losses on account of
risks and perils. It provides financial compensation for the losses suffered
due to the happening of any unforeseen events. By taking life insurance a
person can have peace of mind and need not worry about the financial
consequences in case of any untimely death..
HISTORY OF INSURANCE
Insurance has been around since ancient times. The Babylonians and
Phoenicians had ocean marine insurance to protect a merchant against
losses incurred when a ship did not reach its intended destination with its
load of goods or did not return with payment. This form of insurance,
called respondent, evolved because the goods on board often were used
as collateral for a loan. The lender charged the borrower interest on the
loan and levied an additional sum, the premium, to cover the cost of the
respondent contract. If the ship reached its destination and returned, the
merchant received payment for the goods and in turn paid the
moneylender. If the ship failed to return, the debt was cancelled. This
system was profitable to lenders because many respondent contracts were
sold, and debts were paid more often than cancelled.
In ancient Rome, associations had a form of insurance for their members.
Each member made regular payments to the association in return for
coverage of funeral expenses or for assistance to family members who
were injured or ill.
Insurance also existed in 17th-century England, which was then one of
the world's principal maritime powers. Those seeking marine insurance
would post a list of their cargo and voyages in a London coffee house
owned by Edward Lloyd. Private investors would examine the list and
sign their name by the entries they were willing to guarantee for a fee.
These private investors were the first insurance underwriters, and the
coffee house became the world center of marine insurance. Today the
organization is known as Lloyds of London, and it brings together
individuals, most often working in syndicates, who write all types of
insurance.
Insurance in the modern form originated in the Mediterranean during 14th
century. The earliest references to insurance have been found in Babylonia,
the Greeks and the Romans. The use of insurance appeared in the account
of North Italian merchant banks who then dominated the international
trade in Europe at that time. Marine insurance is the oldest form of
insurance followed by life insurance and fire insurance. The patterns that
have been used in England followed in other countries also in these kinds
of insurance
The oldest and the earliest records of marine policy relates to a
Mediterranean voyage in 1347. In the year 1400, a book written by a
merchant of Florence, indicates premium rates charged for the shipments
by sea from London to Pisa.
The early developments of life insurance were closely linked with that of
marine insurance. The first insurers of life were the marine insurance
underwriters who started issuing life insurance policies on the life of
master and crew of the ship, and the merchants. The early insurance
contracts took the nature of policies for a short period only. The
underwriters issued annuities and pension for a fixed period or for life to
provide relief to widows on the death of their husbands. The first life
insurance policy was issued on June 18, 1583, on the life of William
Gibbons for a period of 12 months.
The history of life insurance in India dates back to 1818 when it was
conceived as a means to provide for English Widows. Interestingly in
those days a higher premium was charged for Indian lives than the nonIndian lives as Indian lives were considered more risky for coverage. The
Bombay Mutual Life Insurance Society started its business in 1870. It
was the first company to charge same premium for both Indian and nonIndian lives. The Oriental Assurance Company was established in 1880.
The first general insurance company- Tital Insurance Company Limited
was established in 1850. Till the end of nineteenth century insurance
business was almost entirely in the hands of overseas companies.
Insurance regulation formally began in India with the passing of the Life
Insurance Companies Act of 1912 and the Provident Fund Act of 1912.
Several frauds during 20's and 30's sullied insurance business in India.
By 1938 there were 176 insurance companies. The first comprehensive
legislation was introduced with the Insurance Act of 1938 that provided
strict State Control over insurance business. The insurance business grew
at a faster pace after independence. Indian companies strengthened their
hold on this business but despite the growth that was witnessed,
insurance remained an urban phenomenon.
The Government of India in 1956, brought together over 240 private life
insurers and provident societies under one nationalized monopoly
corporation and LIC was born. Nationalization was justified on the
grounds that it would create much needed funds for rapid
industrialization. This was in conformity with the Government's chosen
path of State- led planning and development.
The (non-life) insurance business, however, continued to thrive with the
private sector till 1972. Their operations were restricted to organized
trade and industry in large cities. The general insurance industry was
nationalized in 1972. With this, nearly 107 insurers were amalgamated
10
and grouped into four companies- National Insurance Company Ltd., The
New India Assurance Company Ltd., The Oriental Insurance Company
Ltd. and United India Insurance Company Ltd. These were subsidiaries
of the General Insurance Corporation of India (GIC).
TYPES OF INSURANCE
GENERAL INSURANCE:
The basis for general insurance is "transfer of risk".
This means that the insurer agrees to compensate you if you suffer a loss.
Without the insurance you would have to pay for that loss yourself.
11
Obviously this contract is made on the basis that the insurance company
calculates the risk that you, or the total number of people buying
insurance, will cost more in payouts than what is received in premiums.
This is determined by the use of statistics and the information you
disclose
on
your
application
for
insurance.
This includes:
HOME CONTENTS: It can either be "defined event" i.e. the policy
covers loss or damage from a list of "defined" events, e.g. storm or fire;
or "accidental loss or damage" i.e. all accidental loss with some
exclusions.
MOTOR VEHICLE: It can either be "comprehensive" i.e. it covers any
damage to your car as well as damage to the other car or another person's
property; "third party property" i.e. it covers damage caused by your car
to another person's property. This type of insurance will not cover you for
the cost of repairs to your own car; "third party fire and theft i.e. it covers
damage partly for damage caused by your car to another person's
property, and restricted cover for damage to your car cause by theft or
fire.
12
LIFE INSURANCE:
Life insurance is insurance that will protect your family and/or specified
dependents in the event of the policy holders death. In general, it is an
essential component in planning for the future.
There are many options with coverage, depending on your situation. And
there are three main categories of life insurance: term life, universal life,
and whole life insurance.
Term life is the simplest and least expensive type of policy. It's pure
13
insurance with no cash value account. A term life policy has only one
function: to pay a specific lump sum to whomever you've designated,
upon a specific event, your death.
Whole life insurance provides permanent protection for your dependents
while building a cash value account. With this type of insurance, the
insurance company manages the policies various accounts.
Universal life insurance provides permanent protection for your
dependents and is more flexible than whole or variable life.
during that period. Since term life insurance has no cash value, the
amount of protection in this policy is equal to its death benefit. There are
three basic forms of term life insurance: level term, decreasing term, and
increasing term.
LEVEL TERM LIFE INSURANCE:
Level term life insurance provides an equal amount of protection for a
period of time. For example, an Rs 150,000 ten-year level term life
insurance policy pays out Rs 150,000 of coverage until the ten years are
over. At the end of the ten years this level term life insurance policy
would expire, and would pay out no benefits.
DECREASING TERM LIFE INSURANCE:
Decreasing term life insurance is a policy where the benefit amount
decreases gradually over the term of the protection. A 30 year Rs 200,000
decreasing term policy, for example, wound pays an Rs 200,000 benefit
at the beginning of the policy. This amount would gradually decline over
the 30-year term and would pay out Rs 0 at the end of the term.
INCREASING TERM LIFE INSURANCE:
15
16
of 100. The premium rate for a whole life insurance is based on the
assumption that the insured would be paying premiums until the age of
100. This means that at age 100, the cash value of the policy has come to
the point when it equals the face amount of the policy. At this point the
policy has completely matured, no more premiums are owned, and the
policy is completely paid out to the policy owner.
17
18
19
Life Insurers:
20
Life Insurers:
21
S.No. Reg.
Date of
Number Reg.
1
101
23.10.2000
104
15.11.2000
105
24.11.2000
107
10.01.2001
109
31.01.2001
110
12.02.2001
111
30.03.2001
114
02.08.2001
116
03.08.2001
10
117
06.08.2001
22
Pvt. Ltd.
General Insurers :
S.No Registratio
Date of
Name of the
Registratio
Company
n Number
n
1
102
23.10.2000
Royal Sundaram
Alliance Insurance
Company Limited
103
23.10.2000
Reliance General
23
Insurance Company
Limited.
106
04.12.2000
IFFCO Tokio
General Insurance
Co. Ltd
108
22.01.2001
113
02.05.2001
Bajaj Allianz
General Insurance
Company Limited
115
03.08.2001
ICICI Lombard
General Insurance
Company Limited.
24
Life Insurers:
S.N Reg.
Date of
o.
Number
Reg.
121
03.01.200
Company Limited.
14.05.200
Pvt. Ltd.
122
General Insurers :
S.No Registratio
Date of
Name of the
Registratio
Company
n Number
n
1
123
15.07.2002
Cholamandalam
General Insurance
Company Ltd.
2.
124
27.08.2002
Export Credit
Guarantee
Corporation Ltd.
3.
125
27.08.2002
HDFC-Chubb
25
General Insurance
Co. Ltd.
S.No.
127
Yr: 2004-2005:
Insurance Industry in this year, so far has 1new entrants; namely
Life Insurers:
26
128
17.11.2005
INSURANCE BUSINEES:
Insurance business is divided into four classes:
1) Life Insurance
2) Fire Insurance
3) Marine Insurance and
4) Miscellaneous Insurance.
Life Insurers transact life insurance business; General Insurers transact
the rest.
No composites are permitted as per law.
27
OBJECTIVES
28
29
30
Levying fees and other charges for carrying out the purposes of the
Act;
31
32
understandable language; claims procedure in both life and nonlife; setting up of grievance redress machinery; speedy settlement
of claims; and policyholders' servicing. The Regulation also
provides for payment of interest by insurers for the delay in
settlement of claim.
33
34
Bajaj Allianz Life Insurance Co. Ltd. is a union between Allianz AG,
the worlds leading insurer and Bajaj Auto, one of Indias most respected
35
36
premium income of Rs.300 Crores. Bajaj Allianz also became one of the
few companies to make a profit in its first full year of operations. Bajaj
Allianz made a profit after tax of Rs.9.6 crores.
Bajaj Allianz today has a network in more than 485 cities spread across
the length and breadth of the country. From Surat to Siliguri and Jammu
to Thiruvananthapuram, all the offices are interconnected with the Head
Office at Pune.
In the first half of the financial year, 2004-05, Bajaj Allianz garnered a
premium income of Rs. 405 crores, achieving a growth of 84% and
registered a 52% growth in net profits of Rs.20 Crores over the last year
for the same period. In the financial year 2003-04, the premium earned
was Rs.480 Crores, and the profit zoomed by 125% to Rs. 21.6 Crores
VISION
To be the first choice insurer for customers.
To be the preferred employer for staff in the insurance industry.
To be the number one insurer for creating shareholder value.
MISSION
As a responsible, customer focused market leader, Bajaj Allianz is
37
ALLIANZ GROUP
Allianz Group is one of the world's leading insurers and financial
services providers. Founded in 1890 in Berlin, Allianz is now present in
over 70 countries with almost 174,000 employees. At the top of the
international group is the holding company, Allianz AG, with its head
office in Munich.
Allianz Group provides its more than 60 million customers worldwide
with a comprehensive range of services in the areas of:
Property and Casualty Insurance,
Life and Health Insurance,
Asset Management and Banking.
Easy access and reach across the country
38
Bajaj Allianz Life has offices now in over 485 towns across the country
enabling customer to buy our products and get quality efficient service
almost anywhere across the country.
BAJAJ AUTO
39
Bajaj Auto Ltd, the flagship company of the Rs. 8000 crore Bajaj group
is the largest manufacturer of two-wheelers and three-wheelers in India
and one of the largest in the world.
A household name in India, Bajaj Auto has a strong brand image & brand
loyalty synonymous with quality & customer focus.
40
41
Single Premium, Unit Gain Plus, Unit Gain Plus SP, Lifelong Gain Plan,
Unit Gain Single Pension & Unit Gain Easy Pension Plans.
SUPERIOR TECHNOLOGY
In order to ensure speedy and accurate processing of your needs, it has
established world class technology, with renowned insurance software,
which networks all its offices and intermediaries
Using the Web, policies can be issued from any office across the country
for retail products.
Unique, user friendly software is developed to make the process of
issue of policies and claims settlement simpler (e.g. online
insurance of marine policy certificate).
UNIQUE FORMS OF RISK COVER
Special PA cover for Amaranth pilgrims.
Film insurance.
Event management cover.
Sports & Entertainment Insurance Package.
42
43
44
COMPANY PROFILE
LIFE INSURANCE CORPORATION OF INDIA
(LIC)
45
GENERAL INSURANCE
1st
January,
1973
by
the
General
Insurance
Business
46
47
OBJECTIVES OF LIC
Spread Life Insurance widely and in particular to the rural areas and to
the socially and economically backward classes with a view to reaching
all insurable persons in the country and providing them adequate
financial cover against death at a reasonable cost.
Maximize mobilization of people's savings by making insurancelinked savings adequately attractive.
Bear in mind, in the investment of funds, the primary obligation to its
policyholders, whose money it holds in trust, without losing sight of
the interest of the community as a whole; the funds to be deployed to
the best advantage of the investors as well as the community as a
whole, keeping in view national priorities and obligations of
attractive return.
Conduct business with utmost economy and with the full realization
48
49
50
COMPANY PROFILE
ICICI PRUDENTIAL LIFE INSURANCE
51
52
ICICI BANK
ICICI Bank is India's second-largest bank with total assets of
about Rs. 2,513.89 billion (US$ 56.3 billion) on March 31, 2006
and profit after tax of Rs. 25.40 billion (US$ 569 million) for the
year ended March 31, 2006. ICICI Bank has a network of about 614
branches and extension counters and over 2,200 ATMs. ICICI Bank
offers a wide range of banking products and financial services to
corporate and retail customers through a variety of delivery
channels and through its specialized subsidiaries and affiliates in
the areas of investment banking, life and non-life insurance,
venture capital and asset management. ICICI Bank set up its
international banking group in fiscal year 2002 to cater to the cross
border needs of clients and leverage on its domestic banking
53
56
PRUDENTIAL PLC
57
58
59
2004-05
2005-06
2006-07
LIC
87.7
71.04
71.44
PRIVATE PLAYERS
12.3
28.96
28.56
60
61
INNOVATIVENESS
COMPAN
Y
LIC
BAJAJ ALLIANZ
ICICI
PRUDENTIAL
SCORE
128
106.9
122.1
62
RANK
63
COMPAN
Y
LIC
BAJAJ ALLIANZ
ICICI
PRUDENTIAL
SCORE
163.9
96
95.1
RANK
64
FINANCIAL PERFORMANCE
COMPANY
LIC
BAJAJ ALLIANZ
ICICI
PRUDENTIAL
SCORE
158
115.8
78.6
RANK
65
COMPAN
Y
LIC
BAJAJ
ALLIANZ
ICICI
PRUDENTIAL
SCORE
158
115.8
78.6
RANK
66
COMPAN
Y
LIC
BAJAJ ALLIANZ
ICICI
PRUDENTIAL
SCORE
163.1
111
114.1
RANK
67
PEOPLE PRACTICES/
TALENT MANAGEMENT
COMPAN
Y
LIC
BAJAJ
ALLIANZ
ICICI
PRUDENTIAL
SCORE
139
102
114.1
RANK
68
GLOBAL COMPETITIVENESS
COMPANY
LIC
BAJAJ ALLIANZ
ICICI
PRUDENTIAL
SCORE
124
94.1
71
RANK
69
POINTS
SURVEY-2006
LIC
70
POINTS
SURVEY-2005
SBI Life
LIC
71
72
RESEARCH OBJECTIVE
The report identifies the position of Bajaj Allianz in the current insurance
market as a fast emerging insurance company. It gives the detailed
background of the company and its whereabouts before the two insurance
tycoons namely- LIC and ICICI Prudential. It also highlights the
73
RESEARCH DESIGN
The research design for the comparative study is of exploratory type and
the focus is given to discover the possible measures, by detailed analysis,
for the company which would be helpful up to some extent to retain a
good position in the competitive market. The research design is not
formal and rigid one as the focus depends upon the availability of new
ideas and relationship among variables.
74
Primary data have been helpful to explore the opinion of general public
and their future insurance plans with the company. On the basis of
information extracted from the primary data various measures are found
which would be helpful to it in making new strategies in near future.
SAMPLING
75
The sampling is based upon probability sampling methods. The reason isit is the only sampling method that provides essentially unbiased
estimates having measurable precision. The sample size was 60.
ANALYSIS
COMPANY
PRIVATE
EMPLOYEES
GOVERNMENT
EMPLOYEES
BUSINESSMEN
76
LIC
BAJAJ
ALLIANZ
ICICI
PRUDENTIA
L
OTHERS
10
13
10
COMPANY
PRIVATE
EMPLOYEES
GOVERNMENT
EMPLOYEES
BUSINESSMEN
77
LIC
BAJAJ
ALLIANZ
ICICI
PRUDENTIA
L
OTHERS
12
14
12
PRIVATE
EMPLOYEES
GOVERNMENT
EMPLOYEES
BUSINESSMEN
10
13
12
78
NO
Can't
Say
COMPANY
PRIVATE
EMPLOYEES
GOVERNMENT
EMPLOYEES
BUSINESSMEN
79
LIC
BAJAJ
ALLIANZ
ICICI
PRUDENTIA
L
OTHERS
10
16
12
Do you think LIC would continue to loose its grip over the
OPTIO
N
PRIVATE
EMPLOYEES
GOVERNMENT
EMPLOYEES
BUSINESSMEN
80
YES
15
NO
14
18
Can't
say
company would you prefer to get insured with after analyzing all
insurance players?
81
COMPANY
LIC
BAJAJ
ALLIANZ
ICICI
PRUDENTIA
L
OTHERS
PRIVATE
EMPLOYEES
GOVERNMENT
EMPLOYEES
BUSINESSMEN
15
11
82
COMPANY
BAJAJ
ALLIANZ
ICICI
PRUDENTIA
L
OTHERS
PRIVATE
EMPLOYEES
GOVERNMENT
EMPLOYEES
BUSINESSMEN
FINDINGS
From the analysis of the above study it can be revealed that-
83
LIC has played a major role in the field of insurance, while Bajaj
Allianz and ICICI Prudential stay behind it.
84
CONCLUSION
85
RECOMMENDATIONS
86
Today the Indian consumers are increasingly becoming more aware and
are actively managing their financial affairs. Today, while boundaries
between various financial products are blurring, people are increasingly
looking not just at products, but at integrated financial solutions that can
offer stability of returns along with total protection. To satisfy these
myriad needs of customers, insurance products will need to be
customized. Insurance today has emerged as an attractive and stable
investment alternatively that offers total protection - Life, Health and
Wealth. In terms of returns, insurance products today offer competitive
returns ranging from 7% to 9%. Besides returns, what really increases the
appeal of insurance is the benefit of life protection from insurance
products along with health cover benefits.
Therefore, to beat the competition, more and more transparency should
be ascertained between the company and policy holders. Particularly, in
the emerging boom in insurance sector, Bajaj Allianz should be more
customers centered, and well versed in the handling problem and
grievances of the policy holders. Also it should more concentrate on good
advertising media to make the customers well aware of its products.
87
Data show that more rural people are uninsured till the time which is a
good indication for companys prospects in rural areas. Accordingly,
company should prepare its products for rural people and make them
aware of these products. But, meanwhile, the company should not forget
that marketing of financial instruments in a rural area is not an easy job
and for that company would have to convince the rural customers in a
rural way.
88
BIBLIOGRAPHY
BOOKS
Statistics For Management- Richard I. Levin, David S. Rubin
Fundamentals of Statistics- D.N. Elhance
Research Methodology- C.R. Kothari
89
Business World
Business Today
WEBSITES
www.bajajallianz.co.in
www.licofindia.com
www.indiainfoline.com
www.iciciprulife.com
www.financialexpress.com
www.theeconomictimes.com
www.licindia.co
90
ACHIEVEMENTS
91
92
DECLARATION
I Puneet Gupta declare that the Summer Training Project Report entitled
TOPIC being submitted to the T.John Business School for the partial
fulfillment of the requirement for the degree of Master of Business
Administration is my own endeavors and it has not been submitted earlier
to any Institution\University for any degree.
Place:
GUPTA Date:
(MMB103702)
PUNEET
93