REVIEW OF LITERATURE 2.

INTRODUCTION

This chapter presents the review of literature relating to the study undertaken. A brief review of
literature would be of immense help to the researcher in gaining an insight into the selected problem. It
would help in gaining good knowledge of the area under study. This study is the first of its category in
the way as it attempts to compile the views given by expert commissions, research bodies and individual
researchers with reference to private life insurance, level of awareness, policyholders’ level of
satisfaction with Life Insurance Corporation of India and Private Life Insurance companies. The reviews
presented below are based on internet search, perusal of related literature available in libraries and
from various publications of books, newspapers, journals, magazines and research studies made on this
topic.

REVIEWS RELATED TO LIFE INSURANCE POLICY HOLDERS PERCEPTION Chowdhury et al., (2007)36 found
that this is the law of nature that people have to live and play with hazards and to some extent
insurance policy can free people from those frustrations. Even if this is true, people of Bangladesh still
don’t prefer to insure themselves. One may think that the people of Bangladesh are risk lover; on the
other hand other may contradict by saying that their low purchasing power doesn’t permit them to avail
insurance policy. This study will highlight those issues relating to non popularity of insurance companies
in Bangladesh. To find marketing side problems, Gap-model of service marketing will be fitted to the
insurance industry of Bangladesh.

Kothari, et al., (2011)39 stated that the life insurance is one of the most important social security
measures undertaken in the country. Based on primary data generated through direct contacts, this
study attempts to identify determinants of life insurance ownership in the country. This resulted into
finding out what factors play very important role in life insurance policies purchase. Total 100
respondents were there used in this study. Item to total correlation was applied to check the
consistency of the questionnaire. The measures were standardized through computation of reliability
and validity tests. Factor analysis was applied to identify the underlying factors. The findings of this
study provide the individual perception about the insurance policies. Rajeswari and Kartheeswari
(2011)40 determined that the customer satisfaction as the perception of customers on the service
whether that service has met his needs and expectations. Service quality, personal factors, perception of
equity and fairness, price, product quality, situational factors and attributions for service success or
failure are the factors that influence the customer satisfaction. However, the perceptions and
expectations of the policyholders who have taken the policies from Life Insurance Companies vary from
person to person. This study emphasizes the perceptions of the policyholders about the service
rendered by the LIC of India and intends to promote a better theoretical understanding and recognition
of the complexities to service quality and its measurement with respect to life insurance. The study is
based on 380 policyholders from Virudhunagar District situated in South Tamil Nadu. This study also
examines the relationship.
between the demographic factors and SERVQUAL mean score. To determine the reliability of the
attributes, the Cranach’sbetween the demographic factors and SERVQUAL mean score. To determine
the reliability of the attributes, the Cronbach’s Alpha is used to measure reliability of the dimensions
reliability, responsiveness, assurance, empathy and tangibles. The giant public sector life insurance
company in the study area with their thick infrastructure facilities and network of branches enjoyed a
monopoly status in spite of the competition with private players on the basis of their service quality. The
opinion survey with the policyholders also brings to the fore that the LIC has served them well in regard
to dissemination of product knowledge, issue of policies, after sales service before and after claim even
though a slight discontent is reported by minority. Sandhu and Bala (2011)41 inferred that the service
quality has become a highly instrumental co-efficient in the aggressive competitive marketing. For
success and survival in today’s competitive environment, delivering quality service is of paramount
importance for any economic enterprise. Life Insurance Corporation of India, the leading insurance
company has set up ‘benchmarks’ in enervating the whole concept of service quality. The present study
aims to measure customers’ perception towards life insurance service quality by applying a framework
developed by them. An advocated procedure has been used to develop, refine and validate a scale. Data
has been collected from 337 customers from the three cities of Punjab (a progressive State of India). The
findings of the study demonstrate that five-factor structure has been refined to seven factor construct
(consisting of 34 items) representing Proficiency; Media and presentations; Physical and ethical
excellence; Service delivery process and purpose; Security and dynamic operations; Credibility; and
Functionality. Besides, the study also investigates the relationship between each of the generated
service quality dimensions and customers overall evaluation of life insurance service Alpha is used to
measure reliability of the dimensions reliability, responsiveness, assurance, empathy and tangibles. The
giant public sector life insurance company in the study area with their thick infrastructure facilities and
network of branches enjoyed a monopoly status in spite of the competition with private players on the
basis of their service quality. The opinion survey with the policyholders also brings to the fore that the
LIC has served them well in regard to dissemination of product knowledge, issue of policies, after sales
service before and after claim even though a slight discontent is reported by minority.

Sandhu and Bala (2011)41 inferred that the service quality has become a highly instrumental co-
efficient in the aggressive competitive marketing. For success and survival in today’s competitive
environment, delivering quality service is of paramount importance for any economic enterprise. Life
Insurance Corporation of India, the leading insurance company has set up ‘benchmarks’ in enervating
the whole concept of service quality. The present study aims to measure customers’ perception towards
life insurance service quality by applying a framework developed by them. An advocated procedure has
been used to develop, refine and validate a scale. Data has been collected from 337 customers from the
three cities of Punjab (a progressive State of India). The findings of the study demonstrate that five-
factor structure has been refined to seven factor construct (consisting of 34 items) representing
Proficiency; Media and presentations; Physical and ethical excellence; Service delivery process and
purpose; Security and dynamic operations; Credibility; and Functionality. Besides, the study also
investigates the relationship between each of the generated service quality dimensions and customers
overall evaluation of life insurance service. quality. It reveals that among these seven factors, three viz.,
Proficiency; Physical and ethical excellence; and Functionality have significant impact on the overall
service quality of Life Insurance Corporation of India. Managerial implications and directions for further
research have also been discussed.

Gautam and Kumar (2012)43 stated that the attitudes of Indian consumers towards the insurance
services. The study has been made by collecting the responses of consumers through structured
questionnaire on five point Likert scale. A total 377 responses were collected to assess the level of
awareness about the insurance services and their attitude towards insurance services. Findings of the
research show that basic socio demographic and economic variables have 42 Chandhok A., “A Study on
the Attitude of General Public towards LIC after the Privatization”, IJLESS International Journal of
Languages, Education and Social Sciences (2012), 2(1), 11-20. 43 Gautam V. & Kumar M., “A study on
attitudes of Indian consumers towards Insurance Services”, Management Research and Practice (2012),
4 (1), 51-62. 37 significant impact on consumers’ attitudes towards insurance services in Indian scenario.
The findings of the present study may act as input for the insurance companies in Indian market to
frame marketing strategies based on socio demographic and economic variables.

Jain and Saini (2012)44 stated that the consumer demeanor is the study of when, why, how, and where
people do or do not buy a products/services. It blends elements from psychology, sociology, social
anthropology and economics. The study of consumer behavior provides marketers to understand and
predict the future market behavior. Life Insurance is the fastest growing sector in India since 2000 as
Government allowed Private players and foreign direct investment (FDI) up to 26%. Life Insurance in
India was nationalized by incorporating Life Insurance Corporation of India (LIC) in 1956. Life insurance
industry in India being in nascent stage has been found very sensitive to myriads of issue particularly
when someone talks of buying pattern. Consumer choice of one product over other products has been
the issue of concern for many of the researcher and for the organization, who has already putted lot of
hard work in developing the product. Their research discuss about the effect of demographical element
in consumer purchasing attitude for Life Insurance in India