Professional Documents
Culture Documents
The title and scope of her project was “Unit-Linked Insurance Plan
(ULIP) of Metlife India Insurance Company Limited and
comparative study of these plans of its three immediate
competitors”
The project was carried out under the guidance of Mr. Atul Verma ,Sales
Manager, Metlife India Insurance Company Limited (Jaipur Branch)
We found her to be a dedicated and diligent performer. We take this
opportunity to wish her every success in her future endeavors.
Sincerely
Mr. Bipin Chadha
Regional Manager
Metlife India Insurance ( Jaipur Branch)
2
ACKNOWLEDGEMENT
I would also like to thank my internal guide Ms. Varsha Sharma for guide me
throughout our project.
PRIYANKA SHARMA
3
Global Institute of Technology College,
Jaipur
Preface
This research is a part of my summer training without which my M.B.A. is
incomplete. Summer training is an integral part of every M.B.A. course. We can’t rely
merely upon the theoretical knowledge. It is to be complimented by practical know-
how for it to be fruitful. A positive and correct result of the classroom learning needs
realities of practical situation.
The training at Met Life Insurance Co. Ltd. for 45 days was a great learning
experience for me. Met Life Insurance Co. Ltd. is a well diversified insurance
services group having businesses in life insurance and Health insurance. With its
performance, it has proved itself an alluring investing destination for investors.
4
EXECUTIVE SUMMARY
A research study was carried out, based on the conditions prevailing in the
Insurance Market and the with a view to determine the investors preference for ULIP
plans and also the comparison of the plans of Metlife and its 3 immediate
competitors in Jaipur.
The topic of the project was “Unit-Linked Insurance Plan (ULIP) of Metlife India
Insurance Company Limited- determining its preference, most suitable age for
investing and comparative study of these plans of its three immediate
competitors”.
In order to facilitate data collection for research study, canopies were set up at three
places in Jaipur itself. The data was collected by means of the Questionnaire
designed for data collection, which was analysed with the help of tables and
diagrams.
These parameters for determining customer preference for ULIP and also the
comparative study were identified based on the conditions prevailing in the
investment market and the unique benefits and flaws in the Unit Linked Insurance
Plan (ULIP).
5
Since, ULIP involves investment of the premiums paid in the share market, it was
clear that recession would have impacted people’s decision to invest.
To elicit people’s opinion as regards the impact of recession on the decision to invest
in ULIP, questions were designed and included in the questionnaire.
Majority of the investors were found to have lost money due to investment in ULIP.
But since the share market in India has been showing improvements, respondents
were hopeful of high returns.
This is followed by a two day Compliance and Sales Training (CST), in which
information regarding the company products is given. This is to better equip the
Financial Advisors (FA) to sell and close deals.
6
TABLE OF CONTENTS
3. Research methodology
3.6 Limitation
6. SWOT analysis
7. Conclusion
9. Appendix
10. Bibliography
7
CHAPTER 1
8
1. INSURANCE INDUSTRY IN INDIA
Insurance is a policy from a large financial institution that offers a person, company,
or other entity reimbursement or financial protection against possible future losses or
damages.
Insurance is bought in order to hedge the possible risks of the future which may or
may not take place. This is a mode of financially insuring that if such a incident
happens then the loss does not affect the present well-being of the person or the
property insured. Thus, through insurance, a person buys security and protection.
9
Life Insurance:-
It insures the life of the person buying the Life Insurance Certificate. Once a
Life Insurance is sold by a company then the company remains legally entitled to
make payment to the beneficiary after the death of the policy holder.
Medical Insurance:-
This is also known as mediclaim. Here, the policy holder is entitled to receive
the amount spent for his health purposes from the insurance company.
General Insurance:-
This insurance type involves insuring the risks associated with the general life
such as automobiles, business related, natural incidents, commercial and residential
properties, etc.
The insurance sector in India has come a full circle from being an open competitive
market to nationalisation and back to a liberalised market again. Tracing the
developments in the Indian insurance sector reveals the 360-degree turn witnessed
over a period of almost two centuries.
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.
10
• 1928: The Indian Insurance Companies Act enacted to enable the
government to collect statistical information about both life and non-life
insurance businesses.
• 1956: 245 Indian and foreign insurers and provident societies taken over by
the central government and nationalised. 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:
• 1907: The Indian Mercantile Insurance Ltd. set up, the first company to
transact all classes of general insurance business.
• 1968: The Insurance Act amended to regulate investments and set minimum
solvency margins and the Tariff Advisory Committee set up.
• 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.
11
INSURANCE SECTOR REFORMS:
The Malhotra committee was set up with the objective of complementing the reforms
initiated in the financial sector. The reforms were aimed at "creating a more efficient
and competitive financial system suitable for the requirements of the economy
keeping in mind the structural changes currently underway and recognizing that
insurance is an important part of the overall financial system where it was necessary
to address the need for similar reforms…"
In 1994, the committee submitted the report and some of the key recommendations
included:
1) Structure:-
• Government should take over the holdings of GIC and its subsidiaries so that
these subsidiaries can act as independent corporations.
2) Competition:-
• No Company should deal in both Life and General Insurance through a single
entity.
12
• Only One State Level Life Insurance Company should be allowed to operate
in each state.
3) Regulatory Body :-
4) Investments:-
• 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).
5) Customer Service:-
But at the same time, the committee felt the need to exercise caution as any failure
on the part of new players could ruin the public confidence in the industry. Hence, it
was decided to allow competition in a limited way by stipulating the minimum capital
requirement of Rs.100 crores. The committee felt the need to provide greater
13
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.
Insurance Industry:-
The service provider has to design different strategies according the varying
feature of the service. These 4 I’s not only represent the characteristics of different
services but also the problems and advantages attached to it.
• Intangibility
• Inconsistency
14
• Inseparability
• Inventory
• Intangibility:-
Insurance is a guarantee against risk and neither the risk nor the guarantee
is tangible. Hence, insurance rightly come under services, which are intangible.
Efforts have been made by the insurance companies to make insurance tangible to
some extent by including letters and forms.
• Inconsistency:-
• Inseparability:-
• Inventory:-
15
Some of the General Rules:-
1. Mis-description:-
The insurance policy shall be void and all the premiums paid by insured may
be forfeited by the insurance company in the event of mis-presentation or
misdeclaration and/or non-disclosure of any material facts.
2. Reasonable Care:-
The insured shall take all reasonable steps to safeguard the property insured
against any loss or damage. Insured shall exercise reasonable care that only
competent employees are employed and shall take all reasonable precautions to
prevent all accidents and shall comply with all statuary or other regulations
3. Fraud:-
If any claim under the policy may be in any respect fraudulent or if any
fraudulent means or device are used by the insured or any one acting on the
insured’s behalf to obtain any benefit under the insurance policy, all the benefits
under the insurance policy may be forfeited.
1. Insurable interest
3. Subrogation
4. Contribution
5. Indemnity
16
Product Levels:
AUGMENTED
CORE
POTENTIAL
EXPECTED
2. Expected service
3. Augmented service
• Technology
4. Potential service
17
Loans:-
The core product of insurance company is insuring life and non life
products. People opt for this service as they want to secure their life, people
dependent on them and other valuable things in life.
The time factor plays an important role while providing service to the customer.
The customer expects that the procedures for settling the claim should be short and
not much time consuming. They should get the benefits of the service as soon as
possible.
Today the technology is boosting in each and every field. Insurance is not
an exception. Companies have started providing customers facility of online payment
of premium through their websites.
They also provide online assistant to the customer the policy status and how to
calculate the premium. To calculate the premium they just need the present age, the
type of police, sum assured, and accident covered if any.
By filling in this information you can calculate the amount of premium you have to
pay. The customer can pay their premiums by means of credit cards or can also give
standing instruction to the bank in order to pay their monthly premiums.
The insurance companies also provide loan facilities against their policies. At
present loans are granted on unencumbered polices as follows:
Up to 90% of the Surrender Value for policies, where the premium due is fully
paid up , and Up to 85% of the Surrender Value for policies where the premium due
is partly paidup. The minimum amount for which a loan can be granted under a
policy is Rs150. The rate of interest charged is 10.5% p.a., payable half-yearly.
Loans are not granted for a period shorter than six months, or on the security of lost
policies (the assured must have the duplicate policies) or on policies issued under
certain plans. Certain types of policies are, however, without loan facility.
18
FREQUENT TERMS USED
Agent:
It is a loss where the goods are completely lost and become irrecoverable
additional cover:
Under this case the policy does not take into account the current market value.
Assessor:-
Person who estimates the value of goods for the purpose of apportioning the sum
payable by the underwriters to settle the claims. Also called as Surveyor.
Assured:-
Burglary:-
Coverage:-
The scope of protection provided under a contract of insurance; any of several risks
covered by a policy.
Cargo insurance:-
A generic term used in both inland marine and ocean marine insurance to designate
the type’s of insurance available to provide coverage for cargo that is being
transported by truck, rail, air, ship, or boat.
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Certificate of Insurance:-
Claim:-
Co-insurance:-
A provision under which an insured who carries less than the stipulated percentage
of insurance to value, will receive a loss payment that is limited to the same ration
which the amount of insurance bears to the amount required;
Cover Note:-
Indemnity:-
Legal principle that specifies an insured should not collect more than the actual cash
value of a loss but should be restored to approximately the same financial position
as existed before the loss.
Insurable Interest:-
A condition in which the person applying for insurance and the person who is to
receive the policy benefit will suffer all emotional or financial loss, if any untouched
event occurs. Without insurable interest, an insurance contract is invalid,
Insurance:-
Social device for minimizing risk of uncertainty regarding loss by spreading the risk
over a large enough number of similar exposures to predict the individual chance of
loss.
Net Premium:-
The portion of premium rate which is designed to cover benefits of the policy,
excluding expenses, contingencies and profit.
Policy:-
20
Is the legal document that has the conditions of the insurance contract?
Premium:-
Salvage:-
Recovery made by an insurance company by the sale of property which has been
taken over from that insured as a part of loss settlement. The remains of damaged
vehicle or any other property.
Third party:-
Any person other than the two parties signing an insurance, contract.
Underwriting:-
21
• The minimum paid up equity capital for life or general insurance business is
Rs.100 crores.
• The minimum paid up equity capital for carrying on reinsurance business has
been prescribed as Rs.200 crores.
• The insurers are required to maintain solvency margins so that they are in a
position to meet their obligations towards policyholders with regard to
payment of claims.
• All insurers are required to set up proper grievance redress machinery in their
head office and at their other offices.
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• The Authority takes up with the insurers any complaint received from the
policyholders in connection with services provided by them under the
insurance contract.
The insurance sector was opened up for private participation eight years ago. For
years now, the private players are active in the liberalized environment. The
insurance market has witnessed dynamic changes, which include presence of a
fairly large number of insurers in both life, and non-life segment. Most of the private
insurance companies have formed joint ventures with well-recognized foreign
players across the globe. India’s life insurance market has grown rapidly from 2001
to 2009.
New business premiums have grown at 41% compounded annual growth rate
(CAGR). Life insurance market in India will double by2012.
Minimum capital requirement for direct life and Non-life Insurance company is
INR 1000 million and that for reinsurance company is INR 2000million.
A maximum 26% foreign equity stake is allowed in direct insurance and reinsurance
companies. In the 2004-05 budget, the Government proposed for increasing the
foreign equity stake to 49%, this has now come into effect.
There are a total of 13 life insurance companies operating in India, of which one is
a Public Sector Undertaking and the balance 12 are Private Sector Enterprises.
23
INSURANCE COMPANIES:
IRDA has so far granted registration to 12 private life insurance companies and 9
general insurance companies. If the existing public sector insurance companies are
included, there are currently 13 insurance companies in the life side and 13
companies operating in general insurance business. General Insurance Corporation
has been approved as the "Indian reinsurer" for underwriting only reinsurance
business.
24
Table 2.1 Different Insurance companies operating in the Indian Insurance
Sector
Public Sector
Private Sector
GENERAL INSURERS
Public Sector
25
New India Assurance Company Limited www.niacl.com
Private Sector
CHAPTER 2
With over 140 years of experience in Insurance business Metlife has been named by
Forbes as the Best Managed Insurance Co. in the Industry for 2008, an honour
based on the track record of the financial performance, innovation,
Metlife has also been ranked 43 on the Fortune 500(2008), the MetLife
27
companies are one of the world’s largest, strongest and most respected financial
organizations. To add to its cap is another feather in the form of its No.1 ranking in
several group product areas, including life, disability, auto and home, as well as
institutional annuities.
Metlife serves over 90 of the top 100 FORTUNE 500 companies. It has around
$558.6 Billion Assets under Management, more than 49,400 employees worldwide
and more than 70 million customers around the world.
The core values of Metlife include : People Count , Financial Strength ,Partnership,
Personal Responsibility, Innovation and Integrity & Honesty.
• People Count: It's all about People, MetLife's key resource. MetLife will
succeed because we are winning from within.
28
• Personal Responsibility: "Coming into your own", performing as a Leader to
be really effective and successful by acting and making decisions
independently to get results.
• Innovation: Continuously creating and introducing new and original ideas and
ways of doing things.
Metlife commenced its operations in India in 2001 and since then the company has
shown a double digit growth, even in 2008 the company showed a growth of 14%.
MetLife India Insurance Company Limited (MetLife) is an affiliate of MetLife, Inc. and
was incorporated as a joint venture between MetLife International Holdings, Inc., The
Jammu and Kashmir Bank, M. Pallonji and Co. Private Limited and other private
investors, with 25% stake in the hands of Metlife International and the sremaining
75% stake with its Indian Partners.
MetLife is one of the fastest growing life insurance companies in the country. It
serves its customers by offering a range of innovative products to individuals and
group customers at more than 600 locations through its bank partners and company-
owned offices. MetLife has more than 50,000 Financial Advisors, who help
customers achieve peace of mind across the length and breadth of the country.
MetLife, Inc., through its affiliates, reaches more than 70 million customers in the
Americas, Asia Pacific and Europe. Affiliated companies, outside of India, include the
number one life insurer in the United States (based on life insurance inforce), with
over 140 years of experience and relationships with more than 90 of the top one
hundred FORTUNE 500® companies. The MetLife companies offer life insurance,
annuities, automobile and home insurance, retail banking and other financial
29
services to individuals, as well as group insurance, reinsurance and retirement and
savings products and services to corporations and other institutions.
Metlife in India enjoys a Pan India Geographical Presence with over 112 branches in
over 87 cities. (As in May 2008)..
Offices 49 114
30
FACT SHEET
Founded 2001
Employees 7688
31
Core team member of Met Life India insurance co.Ltd:-
• Rajesh Relan
Managing Director
• Shilpa Vaid
Deputy Director- Human Resources
• Gaurav Sharma
Director - Customer Service and Operations
• Girish Malhotra
Director- Agency
• KR Anil Kumar
Director - Financial Planning
& Controller
• KS Raghavan
Chief Administrative Officer
• Preetinder Chadha
Deputy Director - Corporate Sales & Training
• P. S. Sankaran
Director – Business Support
• Sameer Bansal
Director- BA & BP
• Vijay Raghavan
Director - Marketing & Strategy
32
Met Life Partners:-
a. Traditional Products:
• Met Growth
• Met Gold
33
(1)INVESTMENT PLAN:-
(2)HEALTH PLAN:-
• Health Care
(3)MONTHLY INCOME:-
(4)RURAL PLAN:-
• Met Vishwas
• Met Suvidha
(5)PROTECTION PLAN:-
• Met Suraksha
(6)SAVING PLAN:-
• Met Sukh
• Met Suvidha
• Met 100
(7)RETIREMENT PLAN:-
34
• Met Pension Plus
(8)CHILD PLAN:-
• Met Bhavishya
CHAPTER 3
RESEARCH METHODOLOGY
35
3.1 Introduction :-
The marketing of insurance policies involves unique practices when compared to the
marketing of any other product. Insurance policies are intangible in
But with the advent of private players in the Indian Insurance Sector, there has been
an increase in the awareness among the general public as regards the importance of
insurance.
At the same time, the products offered by insurance companies have been innovated
over a period of time.
Unit Linked Insurance Plans (ULIP) is also an outcome of the innovation undertaken
by the insurance companies.
Till recently, individuals seeking to provide protection to their family had no other
option except a life insurance term plan. The plan promised a stipulated amount to
the family of policyholder in the event of his death.
However, the insurance sector has evolved over the last few years and a number of
innovative products have been introduced in the market. One product category that
is increasingly catching the fancy of individuals is the Unit linked Insurance Plan
(ULIP).
These plans, are a combination of insurance and investment and they provide the
policyholder with life cover and in addition to that offer the opportunity to earn returns
on the premium paid.
36
ULIPs give investors the best of both worlds -- risk cover and high returns. These
combine life cover with the potential for a bigger nest egg. ULIPs are insurance
policies in which the investment element, expenses and benefits are to the account
of the policy holder.
The unit linked product in the long run is a very effective and efficient product on
offer for the customers, both in terms of returns and costs. The basic investments
are identifiable. The assets of the fund can be equity share, fixed income securities,
money market instrument, property and derivative instruments.
ULIPs are riding high these days on their equity investments, increasingly making
their presence felt as savings and investment tools, a trend that is getting reflected in
terms of both performance and average ticket size.
ULIPs, which are contemporary products across the world, are fast gaining in
popularity in India. Some of the factors contributing to their success are the
simplicity, transparency and flexibility of these plans.
These policies are adaptable to the changing needs of the customers over their
lifetime. They also give the choice to the customers to select an investment fund
based on their risk profile and offer all the benefits of a traditional life insurance plan.
The response to these plans is so encouraging that more and more players
launching their versions of ULIP.
Today, ULIP accounts for the bulk of the first year premium income that most
37
insurers earn going as high as 95 per cent for Birla Sun Life and ICICI Prudential.
According to data released by IRDA for April- December 2006, ULIP constituted
almost 50% of the total portfolio in terms of premium income, a rise of 5% over the
previous corresponding period.
Premium earned from ULIP increased as much as 127% in the same period. Even in
LIC during the previous fiscal, ULIPs contributed 72% of
Share of traditional products in private insurers’ total portfolio has declined from 21%
during April-December 2005 to 13% in April-December 2006.
In case of LIC in declined from 68% to 61% during the same period.
This guaranteed fund forms the basis of loyalty additions paid by the company in the
10th year and later years.
The entire amount is invested in the share market from the second year onwards,
depending on the debt-equity ratio decided by the policy holder.
On the insurance side of ULIP, the policy holders are offered 5 or 10 or 20 times of
the premium paid as insurance cover as chosen by them.
ULIPs being more lucrative in terms of returns associated with them, are preferred
by customers over other insurance products.
The Research study is directed towards determining the Customers preference for
ULIPs. In addition to this the age influences the people’s decision to invest in UlIPs,
38
so finding out the most suitable age for ULIP investors would help the company in
segmenting and accordingly targeting people based on the need analysis.
Unit-Linked Insurance Plan (ULIP) of Metlife India Insurance Company Limited and
comparative study of these plans of its three immediate competitors”
• To determine the degree (level) of impact of age on the buying behaviour and
finding out the most suitable AGE for ULIP
• Research Design
Questionnaire
• Data Collection
39
There are two types of data collection they are as follows
2. Secondary data
• Observation
• Personal interview
• Telephone interviews
• Mailing of questionnaire
• Schedules
• Internet
• Reports
• Newspapers
• Books, etc.
• Sampling Method
• Data Universe
• Sample Size
• 100 clients
40
3.5.1 Methodology:-
The study was aimed at measuring the customer’s preference for life insurance
companies and the comparison of ULIP plans of the selected companies on basis of
various parameters considered essential for determining where METLIFE’s ULIP
plans could be improved.
For the above purpose a survey was conducted in Jaipur. A questionnaire was
designed and used as a means to collect. For data collection Canopies were set up
outside :
b. Secretarait (15questionnaires)
In all 100 questionnaires were filled up during the data collection process.
The data collected was represented in the form of tables for drawing
41
The level of preference, perception of the customers about the product and company
were identified by means of questions in the questionnaire asking the respondents
to rate their preferences on a scale of 1 to 7.
For the representation of data various charts and graphs have been used as per
requirement.
In order to make the comparative study possible, parameters were chosen and
questions were designed eliciting ratings from the respondents. These ratings were
tabulated and then represented by means of line diagrams.
The time involved in the data collection was 3 days as canopies were set up
on the above mentioned places in Jaipur on 3 different days.
This was followed by analysis of the data collected with the help of Excel and
spss
During the process of data collection, considerable amount of time was spent
in explaining the purpose and the exact nature of the data required from the
questionnaires filled. In addition to this, in some cases questions had to be
explained to the respondents. Moreover, for some questionnaires had to be
filled in as they were not so well read and literate.
The cost involved was basically on the stationary as the canopies were
provided by the company.(Metlife)
42
In addition to this, when we set canopies outside the above mentioned places,
we allied with a clinic owner, wherein the owner provided us with weight
measuring machines and blood pressure measuring equipments. In return for
this, the pamphlets of the clinic were distributed along with the company
brochures.
The decision to invest in ULIP plans varies from person to person. It depends
upon many factors. The factors can be classified into personal, social, economic,
psychological and company related variables.
Age and experience of policyholder are personal factors, while education is a social
factor. Economic factors include occupation, income and wealth, and the
psychological factors consist of perception, satisfaction about the services rendered
by insurance companies, the impact of advertisement and personal selling made by
insurance companies on policyholders.
Amongst the above mentioned factors, age directly influences people’s decision to
invest in ULIP. Questions regarding the scaling of age as a factor influencing the
investment decision have been included in the questionnaire as also determining the
most suitable age for investment in ULIP plans, based on customer preferences.
This would be of great help to the company in segmenting and accordingly target
prospective customers.
Comparative study being one of the objectives of the research study, four
parameters namely premium charged, flexibility, number of funds and transparency
were identified. These are effectively the factors which influence the people’s
selection of the Insurance Company, keeping in mind the product (ULIP) features.
43
Questionnaire has been designed to elicit preferences of the respondents for the
selected Insurance Companies, on the above mentioned parameters.
3.6LIMITATIONS:
Insurance does not give good returns – Still today people think that
Insurance does not give good returns. They are not aware of the modern
Unit Linked Insurance Plans which are offered by most of the Private sector
players. They are still under the perception that if they take Insurance they
will get only 5-6% returns which is not true nowadays. Nowadays most of the
modern Unit Linked Insurance Plans gives returns which are many times
more than that of bank Fixed deposits, National saving certificate, Post office
deposits and Public provident fund.
44
Increased competition – Today the competition in the Insurance sector
has became very stiff. Currently there are 14 Life Insurance companies
working in India including the LIC (life insurance Corporation of India). Today
each and every company is trying to increase their Insurance Advisors so
that they can increase their reach in the market. This situation has created a
scenario in which to recruit Life insurance Advisors and to sell life Insurance
Policy has became very very difficult
Others:-
• Time constraints
45
CHAPTER 4
46
4.1 Customer Preference For ULIPs
ULIP being an innovative product, provides the customers with both investment and
insurance options. In addition to this ULIP provides other benefits like, Capital
Appreciation, Inflation Protection, Tax Benefit. However, people hesitate to invest in
ULIP due to the risks associated with it and also the illiquidity associated with it, due
to the Lock-in-Period. (3Years)
With a view to determine the customers preference for ULIP, two broad factors were
identified viz. Risk-Return Factors and Other Parameters (Capital appreciation,
Inflation protection and Liquidity)
The following Table shows the data obtained from the respondents:
47
Figure 4.1.1 Customer Preference For ULIP
From the above diagram, it can be inferred that 65% of the respondents think that
the returns associated with ULIPs are high and 35% think returns are low. Similarly,
only 75% of the respondents consider the cost associated with ULIPs to be high.
Moreover, 67% of the respondents agree that ULIPs offer inflation protection.
From these figures, it can be inferred that the customers have a high preference for
ULIP plans due to the high returns, low cost and inflation protection offered by it, in
addition to the tax benefit that it offers.
On the flip side, 90% of the respondents are of the opinion that high risks are
associated with ULIP. Moreover, recessionary conditions have added to the risks
with investment in ULIP.
48
deducted by the insurance company and tax benefits can no longer be availed by the
investors.
• People prefer ULIPs due to the high returns, low costs associated with them
and inflation protection offered by them.
• People hesitate to invest in ULIP due to high risks and low liquidity
associated with them.
Age is a crucial factor in making the decision to invest in ULIP plans. The age of the
people directly influences their willingness to bear risks. The younger the people ,
the more is the willingness to bear risks and the older, the less is the willingness to
bear risks.
The respondents gave their opinion by rating the age related statements on a scale
of 1 to 7. Their responses have been tabulated and represented by means of a line
diagram below.
49
Table 4.2.1 Age and the Decision To Invest In ULIP
Agree Disagree
Parameters 1 2 3 4 5 6 7 Total
40 30 10 5 10 3 2 100
Age directly
influences
decision to
invest in Ulip
1 3 5 11 15 20 45 100
Ulip is a Social
Security Tool
50
Figure 4.2.1 Influence Of Age In taking The Decision To Invest In ULIP
From the above diagram it is clear that majority of the respondents have agreed to
the fact that the age of the investor directly influences their decision to invest in Ulip
plans. As many as 70 respondents marked 1 or 2 as their answer, implying that they
agree to the statement that age directly influencesthe decision to invest.
On the other hand, when asked about their opinion about ulip as a social security
tool, as many as 65 respondents marked 6 or 7 as their answer, meaning that they
disagree with the statement that Ulip acts as a social security tool.
This gives a fair idea, that the most suitable age for investment in Ulip as per
respondents opinion would be somewhere above 20 , but less than 55 years of age.
Although, ulip is a product which is suitable for all age groups, but the investment
decision depends on the willingness to take risks, which declines with age.
51
The following table shows the responses of the respondents as regards the most
suitable age for investment in Ulip plans.
Below 20 10
20 – 30 15
30 – 40 55
40 – 55 15
Above 55 5
Total 100
The above table shows that the age group 30 to 40 has been marked by the
respondents as the most suitable age for investment in ULIP plans. It can inferred
that the people belonging to this age group are most willing to take risks, as they are
well settled and are earning and are ready to invest.
This is the age group which the company should target for the sale of ULIP plans.
This will help the company in saving the time wasted in convincing the prospects
other than the preferred age group to invest in ULIP plans.
If the segmentation and targeting for ULIP plans is done keeping in mind the most
suitable age group as mentioned above, then the sales of company’s ULIP Plans
can be increased in a short span of time.
Below is a Bar Diagram showing the most suitable age as per the opinion of the
respondents.
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Figure 4.2.2 Determining The Most Suitable Age For Investment In ULIP
4.3 Comparison Of ULIP Plans Of Metlife With Other Players
( 3 Immediate Competitors Of Metlife in Jaipur)
Based on the company sources, Baja Allianz, ICICI Prudential, Om Kotak Mahindra
Life Insurance have been identified as Metlife’s immediate competitors in Jaipur.
The Questionnaire contained questions eliciting the respondents opinion about their
preference for the company.
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ii. Flexibility in terms of the number of times the type of fund in which the money
is to be invested in case of ULIP products is permitted.
iii. The number of fund options between which the investor can switch.
iv. The Transparency of the work of the agents and employees of the
company.
Based on the data collected the following table has been drawn, which shows the
customer preferences for the chosen companies as regards the identified
parameters.
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Figure 4.3.1 Customer Preference For Metlife
The above diagram shows that, respondents are of the opinion that Metlife charges
Reasonable Premium, as many as 55% of the respondents agreed to this.
58% of the respondents agreed that Metlife’s Ulip plans offer greater flexibility.
However, only 45% agreed that the number of funds offered to the investors for
switching is high. At the same time, investors are of the opinion that, Metlife’s agents
and employees should be transparent in their work and the investors should be
informed about their functioning.
Below, a line diagram has been drawn which shows the percentage of respondents
who responded favourably for the different Insurance companies, based on the
features of the Ulip plans offered by them to the investors.
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Figure 4.3.2 Comparison Based on Customer Preference
The respondents have responded most favourably for ICICI Prudential , as is evident
from the above diagram. Metlife and Bajaj Allianz have been responded by the
investors in almost the same way.
However, there have been a few differences in the responses in terms of the
flexibility offered by ULIP plans of the two companies, wherein 58% of the
respondents consider that Metlife’s Ulip plans offer greater flexibility and as against
this only 50% of the respondents agreed that Bajaj’s Ulip plans offer flexibility.
Om Kotak Mahindra, another close competitor of Metlife has been rated as the
lowest, as the respondents have responded the least favourably for Kotak Mahindra.
Only 24% of the respondents agreed that the employees of Kotak Mahindra work
transparently, 41% agreed that their premiums are reasonable, 42% agreed that Ulip
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plans offered by Kotak offer Greater Flexibilty and as low as 32% consider that Kotak
offers greater number of funds for switching purposes.
• Respondents consider that the premiums charged for Metlife’s Ulip plans are
reasonable.
• Flexibility offered to the investors in terms of the number of times they can
switch between different funds as regards Ulip is also satisfactory in the case
of Metlife’s Ulip plans.
• However, the company needs to improve upon the number of funds available
to the investors and the transparency of its employees.
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CHAPTER5
FACTS AND FINDING
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5.2 My Learnings:-
The Summer Internship Project done at Metlife India Insurance Limited has been
extremely helpful in enhancing overall selling and analytical skills.
As part of the training program, a 7 day training session was kept, wherein the
fundamentals of Insurance were explained in full details.
As part of the CST, all the major products of Metlife were explained. Then began
selling, where the first step was prospecting i.e., filling My Market 100, who shall
be called upon for sales purposes.
Moving on, the first stage of maturity was considered to be when one is
successful in obtaining time from the prospect to meet them. While calling your
prospect in order to fix meeting time ensure the following:
While on call (meeting your prospect on the date and time given by him/her), one
has to ensure the following:
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• Give them an illustration of the premium payable
• Follow up
In addition to the Sales done, a Research Project as per the objectives mentioned
above, helped in enhancing analytical abilities.
Besides, the following benefits will accrue to Metlife from the research study
conducted:
• A fair idea of the current and prospective investors’ opinion about Unit
Linked Insurance Plans (ULIP), based on the risk and returns associated
with Ulips and the unique features and benefits offered by Ulip plans.
However, 33% of the respondents felt that Asia is not much effected due
to recession and thereby, it does not affect their investment decisions.
• Segmenting the market for ULIP according to the most suitable age as per
the respondents’ opinion. This will also save the company the time in
offering wrong products to wrong customers. In other words, keeping in
mind the age of the investor, a suitable plan can be offered and a sale
obtained without much difficulties.
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customer’s preference. These modification and improvements have been
mentioned above in the recommendations.
CHAPTER 6
SWOT ANALYSIS
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STRENGTHS:-
WEAKNESSES:-
2. Delivery problem
OPPORTUNITIES:-
THREATS:-
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CHAPTER 7
CONCLUSION
63
Conclusion :-
From the above discussions it can be concluded that, the Research Project
undertaken at Metlife India Insurance Limited, has been of great help both to the
company for the reasons discussed above and to the trainee.
Sales, which had to be accomplished as a part of the Summer Internship, has been
of immense help in developing basic sales & marketing skills.
• Survey done with interest of Metlife India Insurance Co. Ltd. has been
conducted successfully and results are discussed above.
• Sales done during the Internship Period has helped in improving selling
skills. ( Achieved Rising Star)
The importance of insurance and the scope it has in India is evident from the fact
that the major business houses have ventured in the Insurance Sector, since the
opening up of this sector for private players.
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What remains to be achieved, is the trust and faith of the general public in the private
players.
In addition to this, the continuous innovation undertaken by the private players has
widened the horizons of the Insurance Sector in India. But there is still a lot that can
be achieved as far as insurance in India is concerned.
It is time that we start taking insurance in the right spirit, rather than as a liability,
especially in today’s risky and dynamic environment.
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CHAPTER 8
RECOMMENDATION AND SUGGESTION
66
8.1 Recommendations to the Company:-
During the surveys that were conducted and while interacting with people of
Jaipur, it was observed that:
• There is a lack of awareness among the people about Metlife and its
products.
• People fear that they may end up losing money by making an investment
in the products of Metlife.
• Investors are of the opinion that the work of Metlife’s employees should be
made more transparent.
• As regards Ulip plans of Metlife, it has been found that the number of
funds available for switching should be increased, thereby enhancing the
choices to the investors.
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• Modify Existing ULIP Plans: As is evident from the comparative
study of Ulip plans of Metlife, Bajaj Allianz, ICICI Prudential and Om
Kotak Mahindra Life that as regards premium charged and flexibility,
the Ulip plans of Metlife need not much improvement. This is because
the respondents are of the opinion that, premium charged for Ulips are
reasonable and these plans offer greater flexibility.
However, the Ulip plans of Metlife need improvement with regard to the
number of types of funds that are available for switching.
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CHAPTER 9
APPENDIXES
69
9.1 Questionnaire
Q1) Have you invested in ULIP?
a) Yes b) No
a) a)yes b) No
Agree
Disagree
1 2 3 4
5 6 7
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ULIP A BETTER OPTION
Rate the following on the basis of your preference for investment in ULIP on a
scale of 1 to 7
L Low
High
1 2 3 4 5
6 7
investment in ULIP
Agree
Disagree
1 2 3 4 5 6
7
investment in ULIP
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Q12) ULIP holders mostly belong to the age group of:
a)
Below 20
b)
20 – 30
c)
30 – 40
d)
40 – 55
e)
Above 55
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THE CHOICE OF INSURER
Rate the following statements on the basis of Your preference for the
insurance company:
Agree
Disagree
1 2 3 4 5
6 7
Metlife
Bajaj Allianz
ICICI prudential
Agree
Disagree
1 2 3 4 5
6 7
Metlife
Bajaj Allianz
ICICI prudential
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Agree Disagree
1 2 3 4 5
6 7
Metlife
Bajaj Allianz
ICICI prudential
Agree
Disagree
1 2 3 4 5
6 7
Metlife
Bajaj Allianz
ICICI prudential
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PERSONAL INFORMATION:
a)Male b) Female
a)
Below 20
b)
20 – 35
c)
35 – 45
d)
Above 45
a)
Business Man
b)
Profession (specify)
c)
Student
d)
Others (specify
a)
Below 1lac
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b)
1lac – 3 lacs
c)
3lacs – 5 lacs
d)
Above 5 lacs
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CHAPTER 10
BIBLIOGRAPHY
77
WEB SITES:-
• www.metlife.co.in
• www.metlife.com
• www.irdaindia.gov
• www.indianinsuranceresearch.com
• www.bimaonline.com
• www.bimadeals.com
• www.thefinancialexpress.mht
• www.personalfn.com
• www.rgicl.com
• www.ipruniverse.com
• www.irdaindia.org
• www.indiacore.com
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MAGAZINES:-
• INSURANCE PLUS
• BUSINESS INDIA
• ECONOMIC TIMES
• SURVEY
SEARCH ENGINES:-
• www.google.com
• www.yahoo.com
• www.altavista.com
BOOKS :-
• Yojna (Magazine)
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