Professional Documents
Culture Documents
(MARKETING)
SUBMITTED BY
P.R.NO:
OF
GUIDED BY
PROF.
1
TILAK MAHARASHTRA UNIVERSITY, PUNE
CERTIFICATE
University Seal
2
ACKNOWLEDGEMENTS
Avadhesh Vishvakarma
3
INDEX
CONTENT PG.NO
4
INSURANCE AGENTS
SEVEN P’S OF INSURANCE COMPANIES 42
COMPETITORS OF METLIFE 50
MARKET SHARE OF DIFFERENT 59
INSURANCE COMPANIES
METHODOLOGY 60
SAMPLING PLAN 60
DATA ANALYSIS & INTERPRETATION 61
FINDINGS 62
LIMITATIONS 77
CONCLUSIONS 78
RECOMMENDATIONS 79
APPENDIX 80
INTRODUCTION TO PROBLEM
5
2) STATEMENT OF THE PROJECT
HISTORY:
Life insurance came to India from England in 1818 when
oriental life insurance company started in Calcutta by Europeans. After this
many insurance companies had been started in India. But these companies
were looking after only the needs of European community established in
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India. Indian people were not being insured by these companies. First Indian
life insurance company came as Bombay mutual life insurance assurance.
Second company was Bharat insurance company came in 1896. After this
the united India in madras, national Indian and national insurance in Calcutta
and the co-operative assurance in Lahore were established in 1906.
To regulate Indian insurance business first insurance act came
in 1912 as life insurance company act and provident fund act. These acts
consist of premium rates tables and periodical valuations of companies. In
the first two decade of 20th century many life insurance companies were
started. So the insurance act came in 1938 to governing life and non life
insurance companies and to provide strict state control. In 1956 the life
insurance business in India was nationalized. In 1956 life insurance
corporation of India (LIC) was created to spreading life insurance much
more widely particularly in rural areas. In that year LIC had 5 zonal offices,
33 divisional offices and 212 branch offices. In 1957 the business of LIC of
sum assured of 200crores, 1000crores in 1970, and 7000crores in 1986.
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Insurance business is divided into four classes:
• Life Insurance
• Fire
• Marine
• Miscellaneous Insurance.
Insurance provides:
• Protection to investor.
• Accumulation of savings.
• Channeling these savings into sectors needing huge long term
investment.
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The origins of Metropolitan Life Insurance Company (MetLife) go back to
1863, when a group of New York City businessmen raised $100,000 to
found the National Union Life and Limb Insurance Company.
The new company insured Civil War sailors and soldiers against disabilities
due to wartime wounds, accidents, and sickness. In 1868, after several
reorganizations and five difficult years, the company decided to focus on the
life insurance business.
This new venture also faced difficulties. A severe business depression that
began in the early 1870s rapidly put half of the 70 life insurance companies
operating in New York State out of business.
By 1880, the company was signing up 700 new industrial policies a day.
Rapidly increasing volume quickly drove down distribution costs, and the
new program proved immediately successful.
So successful was this approach that by 1909, MetLife became the nation's
largest life insurer in terms of insurance in force, a leadership position we
continue to hold today in North America.
For 140 years, MetLife has been insuring the lives of the people who depend
on us. Our success is based on our long history of social responsibility,
strong leadership, sound investments, and innovative products and services.
TODAY
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MetLife’s corporate vision – to build financial freedom for everyone –
guides the company’s response to people’s growing need for first-rate
financial products and services through various life stages and economic
cycles. MetLife’s trusted brand, capital strength, and existing relationships
with millions of individual and institutional customers around the globe
uniquely position MetLife among its competitors.
The year 2001 was a true test of the qualities that define MetLife. The
company’s core values, brought to life in what MetLife does every day, were
no more evident than in MetLife’s response to the tragic events that shook
our nation on September 11. MetLife responded quickly. The company
served its customers, communities and employees during this difficult time.
At the same time, MetLife invested $1 billion in a broad array of publicly-
traded common stocks.
The sale of State Street Research & Management Company to Black Rock,
Inc. was announced in 2004. In line with MetLife’s strategy to focus on core
business growth, the sale benefited many of the company’s Individual and
Institutional Business clients who held investments through State Street
Research, as it became part of one of the largest publicly traded investment
management firms in the U.S.
MetLife took a major step toward realizing this goal in 2005, when it
acquired Travelers Life & Annuity and substantially all of Citigroup’s
international insurance businesses for $12 billion. Completed on July 1,
2005, the Travelers acquisition made MetLife the largest individual life
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insurer in North America based on sales, the second largest provider of retail
annuities and the largest provider of institutional annuities.
Today, a time when consumers are feeling a greater financial burden than
ever before, MetLife is helping millions of customers create their own
personal safety net. At no time in the company’s history has MetLife been as
well positioned to capitalize on its history, its reputation for security and
stability, and its innovative products and services as it is today.
In the future, MetLife will continue to grow its business with focus,
innovation and profitability. This will be accomplished by drawing on the
reservoir of history that has produced an enduring set of corporate values
based on more than 138 years of integrity, social responsibility, strong
leadership and financial strength.
COMPANY PROFILE
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The Metropolitan Life Insurance Company (MetLife ®), established in
1868, is one of the largest insurers in the US, with over US$ 2.4 trillion of
life insurance. MetLife serves approximately 10million individual
households in the US as well as 88 of the Fortune 100 companies. MetLife’s
institutional clients have approximately 33 million employees and members.
MetLife India Life Insurance Co. Ltd was
incorporated in India on April 11th, 2001 as a joint venture between
MetLife International Holdings Inc., The Jammu and Kashmir Bank, M.
Pallonji and Co. Pvt. Ltd. and other private investors.
MetLife India has developed and distributes a range of life insurance
products in India.
MetLife has more than 50,000 Financial Advisors, who help customers
achieve peace of mind across the length and breadth of the country.
The last 8 years of its presence in India, have seen MetLife evolve into a
strong brand, serving its customers through a diversified distribution
approach.
In line with its vision to be the most formidable player in the Indian life
insurance industry, MetLife aims to grow faster than the industry.
MANAGEMENT TEAM
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(1) Mr. Rajesh Relan
Managing Director
Appointed Actuary
Director- Agency
(4) Mr. Nitish Asthana
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Director - Customer Service and Operations
FUTURE PLANS
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TRADITIONAL METLIFE PRODUCTS
TRADITIONAL
PRODUCTS
MONEY BACK
TERM ENDOWMENT CHILD PENSION
PLAN PLAN PLAN PLAN
PLAN
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INDIVIDUAL PLANS
CHILD PLANS :
1) MET BHAVISHYA
2) MET JUNIOR ENDOWMENT
3) MET JUNIOR MONEYBACK
4) MET MAGIC PLUS
CHILD
PLANS
MET
MET MET
MET JUNIOR
ENDOWMEN JUNIOR
BHAVISHYA MAGIC PLUS
T MONEYBAK
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RETIREMENT PLANS :
RETIREMENT
PLANS
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SAVING PLAN
1) MET SUKH
2) MET SUVIDHA
3) MET SARAL
4) MET 100
SAVING
PLANS
MET
MET MET MET
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PROTECTION PLANS:
1) MET SURAKSHA
2) MET SURAKSHA TROP
3) MET SURAKSHA PLUS
PROTECTION
PLANS
23
INVESTMENT:
INVESTMENT
PLANS
MET
MET MET
GOLD PLUS
EASY PLUS WEALTH PLUS
MET MET
FORTUNE SMARTLIFE
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RURAL PLANS:
1) METLIFE VISHWAS
2) MET SUVIDHA – RURAL
RURAL
PLANS
MET
METLIFE
SUVIDHA
VISHWAS RURAL
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THEORETICAL PERSPECTIVE
26
FUNCTIONS OF INSURANCE
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• Contributes towards the development of 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.
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LIFE INSURANCE
• Life insurance as risk cover: - Insurance is all about risk cover and
protection of life. Insurance provides a unique sense of security that
no other form of invest can provide.
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FUNCTIONS OF AGENCY MANAGER
• To recruit advisors.
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VARIOUS TYPES OF LIFE INSURANCE POLICIES
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• Whole life insurance policies: This type of policy runs as long
as the policyholder is alive and is covered for the entire life of the
policyholder. In this policy the insured amount and the bonus is
payable only to nominee on the death of policy holder.
33
DIFFERENT DISTRIBUTION CHANNELS OF
INSURANCE IN INDIA
34
vast branch networks, are helpful to insurance companies. This
channel of selling insurance is known as Banc assurance.
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become a major force to reckon with in distributing insurance
products. Such as- Bajaj Allianz tied up with Maruti Udyog and Ford
for auto insurance and Tata AIG life has tied up with Tata tea,
khaitan’s Williamson major and bridge foundation for selling rural
policies.
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In the competitive market, insurance companies are being forced to adopt a
strictly professional approach in marketing. The insurance companies face
the challenge of changing the uninspiring public image of the industry.
Some of the important marketing elements are-
• Marketing mix.
• The importance of relationship.
• Positioning.
• Value addition.
• Segmentation.
• Branding.
• Insuring service quality.
• Effective pricing.
• Customer satisfaction research.
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• Growth scenario in the world.
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Augmented product: An insurance company can provide different
types of services to differentiate their products-
• Post sales services.
• Branches in different places for customers.
• Customer complaint management.
• Payment option convenient to customers.
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• Assessment of risks (of the insured and the insurance corporation)
and estimation of losses: Efficiency of actuaries and assessors of the
insurance policies in fixing premiums and settling claims is foremost
an important area for achieving overall efficiency in operations. The
quality of assessing the risk and estimation of losses has the largest
claim on the performance of an insurance company. Well trained,
experienced and expert hands are needed for the operations.
• Penetration into and exploitation of markets: Market penetration
or exploitation of a company can be identified with the growth in
number of policies in each type of insurance, growth rate in earnings
or turnover, company’s market share, increase in number of branches
and divisions etc. Efforts of the company as a whole and that of the
divisions and branches are assessed to measure the effectiveness.
• Control over investment and operating costs: Control over
resources such as men, machines, and materials at each level of the
organization provides measures of efficiency of a unit as well as the
organization. Investment control and expense control are dealt
separately and the effectiveness of management’s’ decisions at
various levels is to be assessed separately
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SEVEN P’S OF INSURANCE SECTOR
1.Product:
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agent, the prestige of the insurance company and the facilities of claims
and compensation. It is natural that the users expect a reasonable return
for their investment and the insurance companies want to maximize their
profitability. Hence, while deciding the product portfolio or the product-
mix, the services or the schemes should be motivational. The Metlife’s
Group Insurance scheme is required to be promoted, the Crop Insurance is
required to be expanded and the new schemes and policies for the
villagers or the rural population are to be included. The Life Insurance
Corporation has intensified efforts to promote urban savings, but as far as
rural savings are concerned, it is not that impressive. The policy makers
are required to activate the efforts. It would be prudent that the METLIFE
is allowed to pursue a policy of direct investment for rural
development. Investment in Government securities should be stopped and
the investment should be channelized in private sector for maximizing
profits. In short, the formulation of product-mix should be in the face of
innovative product strategy.
2.Pricing:
ii) Interest charged for defaulting the payment of premium and credit
facility,and
The three main factors used for determining the premium rates under a
life insurance plan are mortality, expense and interest. The premium rates
are revised if there are any significant changes in any of these factors.
• Mortality: (deaths in a particular area): When deciding upon the pricing
strategy the average rate of mortality is one of the main considerations. In
a country like South Africa the threat to life is very important as it is
played by host of diseases.
• Expenses: The cost of processing, commission to agents, reinsurance
companies as well as registration are all incorporated into the cost of
installments and premium sum and forms the integral part of the pricing
strategy
3.Place:
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This component of the marketing mix is related to two important facets --
i) Managing the insurance personnel, and
4. Promotion:
5. People:
47
Understanding the customer better allows to design appropriate products.
Being a service industry which involves a high level of people interaction,
it is very important to use this resource efficiently in order to satisfy
customers. Training, development and strong relationships with
intermediaries are the key areas to be kept under consideration. Training
the employees, use of IT for efficiency, both at the staff and agent level, is
one of the important areas to look into.
6. Process:
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7. Physical Distribution:
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by selling a range of products. It is anticipated that rather than formal
ownership arrangements, a loose network of alliance between insurers and
banks will emerge, popularly known as bancassurance.
Another innovative distribution channel that could be used are the non-
financial organisations. For an example, insurance for consumer items
like fridge and TV can be offered at the point of sale. This increases the
likelihood of insurance sales. Alliances with manufacturers or retailers
of consumer goods will be possible and insurance can be one of the
various incentives offered.
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• Integrity
• Customer first
• Boundary less
• Ownership
• Passion
Key features:
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HDFC for the year ending March 31, 2007 was Rs. 2, 856 crores and
new business premium income was Rs. 1,624 crores. The company
has covered over 8, 77,000 lives year ending March 31, 2007. HDFC
standard is having 1000 advisors in 11 towns.
Key features:
52
Aviva life insurance: Aviva is UK’s largest and the world’s fifth
largest insurance Group. It is one of the leading providers of life and
pensions products to Europe and has substantial businesses elsewhere
around the world. Aviva has a joint venture of Dabur, one of India's
oldest, and largest Group of companies. And country's leading
producer of traditional healthcare products. In accordance with the
government regulations Aviva holds a 26 per cent stake in the joint
venture and the Dabur group holds the balance 74 per cent share.
Aviva has 193 Branches in India (including rural branches) supporting
its distribution network. Through its Banc assurance partner locations,
Aviva products are available in more than 2,795 locations across
India. Aviva has a sales force of over 30000 financial planning
advisors.
Key features:
• Through the “Financial Health Check” (FHC) Aviva’s sales force has
been able to establish its credibility in the market. The FHC is a free
service administered by the FPAs for a need-based analysis of the
customer’s long-term savings and insurance needs. Depending on the
life stage and earnings of the customer, the FHC assesses and
recommends the right insurance product for them.
• Introduced the concept of Banc assurance in India.
• Products to provide customers flexibility, transparency and value for
money.
• Differentiation in fund management operations.
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Max New York life insurance: Max New York Life Insurance
Company Ltd. is a joint venture between New York Life, a Fortune
100 company and Max India Limited, one of India's leading multi-
business corporations The Company's paid up capital is Rs. 907.4
crore. Max New York life is working on the base of six core values-
• Excellence,
• Honesty,
• Knowledge,
• Caring,
• Integrity
Key features:
• Max New York Life has adopted prudent financial practices to ensure
safety of policyholder's funds.
• Investing significantly in its training programme and each agent is
trained for 152 hours as opposed to the mandatory 100 hours
stipulated by the IRDA before beginning to sell in the marketplace.
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Bharti Axa life insurance: Bharti Axa life insurance is a joint
venture between Bharti, one of India’s leading business groups with
interests in telecom, agri business and retail, and Axa world leader in
financial protection and wealth management. The joint venture
company has a 74% stake from Bharti and 26% stake of Axa. The
company started its operations in December 2006. Now company is
having over 5200 employees across over 12 states in the country.
Company is working on the base of five core values-
• Professionalism
• Innovation
• Team Spirit
• Pragmatism
• Integrity
Key features:
55
Tata AIG life insurance: Tata AIG Life Insurance Company
Limited (Tata AIG Life) is a joint venture company of the Tata Group
and American International Group, Inc. (AIG). The Tata Group holds
74 per cent stake in the insurance venture with AIG holding the
balance 26 percent. Tata AIG Life provides insurance solutions to
individuals and corporate. Tata AIG Life Insurance Company started
to operate its business in India on April 1, 2001. Tata AIG is having
3000 advisors all over India.
Key features:
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Key features:
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ING Vysya is working on the base of five core values-
• Professionalism
• Entrepreneurial
• Trustworthy
• Approachable
• Caring
Key features:
58
MARKET SHARE OF DIFFERENT INSURANCE
COMPANIES IN INDIA
METHODOLOGY
59
Research is totally based on primary data. Secondary data can be used only
for the reference. Research has been done by primary data collection, and
primary data has been collected by meeting with the branch and agency
manager of different insurance agencies and branches in Mumbai.
SAMPLING PLAN
60
DATA ANALYSIS & INTERPRETATION
FINDINGS
Primary data has been collected by the survey of branch and agency
manager of different insurance companies in Mumbai. sample size for this
research is 10.
61
Recruitment of advisors:- In insurance industry advisors play
most important role, and these advisors are recruited through different
ways. Mainly four ways for recruiting the advisors are-
1. Through personal references.
2. Through advertisements.
3. Through walk in interviews.
4. Through placement agencies.
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So most of the companies are recruiting their advisors through personal
reference and through advertisement, some companies are recruiting
their advisors through walk in interviews also, but none company is
recruiting their advisors through placement agencies.
Active Incentives
63
yes 4 40
no 6 60
Total 10 100
64
So most of the companies are giving training session and awarding non
cash prizes to make their advisors active, some of the companies are
increasing incentives and offering higher channel position to make their
advisors active.
Products Endowment
TYPE OF PRODUCTS
66
So all the companies are promoting their unit linked products and some
companies are promoting rest of the products including unit linked
products.
Total 10 100
BASIS OF PRODUCT DEPLOYMENT
68
So most of the companies are deploying their products based on the
customers need and demand.
Differentiation in Pricing
Differentiation in Service
DIFFERENTIATION IN STRATEGIES
70
So most of the companies are giving better service quality and better
pricing to differentiate their products from their competitors.
71
Response Frequency Percent
yes 6 60
no 4 40
Total 10 100
MODE OF INTERACTION
72
So almost all the companies are interacting with customers through
direct marketing and by telephonic contacts (creating database).
73
Response Frequency Percent
yes 8 80
no 2 20
Total 10 100
74
So most of the insurance companies think that providing better service
quality is most suitable strategy to compete in the market.
75
Premium collection:-
Premium Collection
76
LIMITATIONS
• Time limitation
77
CONCLUSION
78
RECOMMENDATIONS
79
APPENDIX
80
QUESTIONAIRE
Name-
Company-
Designation-
Contact no.-
(a) < 2 years (b) 2-5 years (c) 5-8 years (d) >8 years
(a) < 2 years (b) 2-5 years (c) 5-8 years (d) >8 years
82
11. Which kind of strategies should an insurance company use to
compete in the market (in your view)?
(a) <2 Cr. (b) 2-4 Cr. (c) 4-5 Cr. (d) >5 Cr.
13. Other useful activities which you do in agency (if any, please
mention)……………………………………………………………………...
………………………………………………………………………………...
………………………………………………………………………………...
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BIBLIOGRAPHY
BOOKS
INTERNET
1) www.google.com
2 ) www.metlife.com
3) www.irda.com
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