A

PROJECT REPORT

SBI LIFE INSURANCE COMPANY

SUBMITTED TO

Dr. Pradip Kumar Das

SIKKIM UNIVERSITY

DEPARTMENT OF MANAGEMENT AND COMMERCE

SUBMITTED BY

ARCHANA KUMAR

11UBA003

(BATCH-2011-2014)

BBA-MBA

SIKKIM UNIVERSITY

6TH MILE, TADONG, GANGTOK

SIKKIM-737102

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ACKNOWLEDGEMENTS

This is a matter of great pleasure as well as great privilege and pride for me to present

this project report. This project became possible only due to full cooperation and

sincerity provided by the Company and Institute as well. I am indebted and thankful to

the management of SBI LIFE INSURANCE for providing me an opportunity to work

in this esteemed and flourishing organization.

Research Report is a combined effort including this one also, so I would like to thank to

all who have helped me completion of this report  purposeful.

Further I would like to thanks to all of my Teachers, Staff Members, Library Members,

and Friends for their valuable support and advices which helps me a lot to completing

this survey purposeful.

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STUDENT DECLARATION

To,

The Principal,

Sikkim University

Tadong

Gangtok

Respected Sir,

I, ARCHANA KUMARI the student of BBA 3rd semester, hereby declare that

the project report entitled “Internship program on SBI Life Insurance”

developed and submitted under the guidance of Prof. Dr. Pradip kumar Das

This is my Original work.

The project presented here is my own work and has not been duplicated from

any other source.

Thanking You

Yours Sincerely

ARCHANA KUMARI

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Index

1. EXECUTIVE SUMMARY

2. OBJECTIVES

3. INTRODUCTION OF INSUARANCE

4. COMPANY PROFILE

5. KINDS OF LIFE INSURANCE POLICIES

6. CONVENTIONAL LIFE INSURANCE

7. COMPANY PROFILE

8. INSURANCE INDUSTRY IN INDIA

9. PURPOSE AND NEED FOR INSURANCE

10. INDIAN SCENARIO

11. TURNOVER OF THE COMPANY

12. PERSONAL EXPRIENCES

13. RESEARCH METHODOLOGY

14. CONCLUSION

15. RECOMMENDATIONS

16. BIBLIOGRAPHY

EXECUTIVE SUMMARY

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The purpose of this training was to have practical experience of working an organization in

the field of marketing and to have an exposure to various management practices in the field

of marketing.

Development of channel is very important for any company to boost it’s business.

Development of channel includes creating a network of financial consultants for facilitating

the increase in sales of the company.

I have done the work for 10 weeks in SBI Life Insurance Company.

I worked in SBI life insurance in muzaffarpur at Patna circle.

.

The main purpose of the project was basically to develop the channel of SBI Life Insurance

Company.

PROJECT TITLE

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“A Study on the Customers Investment Preferences and Awareness of SBI LIFE Insurance Service”

OBJECTIVES

1. To understand the customer investment preferences.

2. To get an instant overview of the insurance industry, its perspective, present

Scenarios and the competitors.

3. To study the factors influencing customer preferences towards various investment

Instruments

4. To analyses acceptance of SBI LIFE insurance policies.

INTRODUCTIONHISTORY

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Insurance has been known to exist in some form or other since 3000 BC. The Chinese traders,

travelling treacherous river rapid would distribute their goods among several vessels, so that

the loss from any one vessel being lost, would be partial and shared, and not total. The

Babylonian traders would agree to pay additional sums to lenders, as the price for writing off

the loans, in case of the shipment being stolen. The inhabitants of Rhodes adopted the

principle of ‘general average’, whereby if goods are shipped together, the owners would bear

the losses in proportion, if loss occurs, due to jettisoning during distress. (Capital of ships

caught in storms, would throw away some of the cargo to reduce the weight and restore

balance. Such throwing away is called jettisoning) The Greeks had started benevolent

societies in the late 7th century AD, to take care of the funeral and families of members who

died. The friendly societies of England were similarly constituted. The Great Fire of London

in 1666, in which more than 13000 houses were lost, gave a boost to insurance and the first

insurance company, called the Fire Office, was started in 1680.

The origin of insurance business as in vogue at present, in traced to the Lloyd’s Coffee House

in London. Traders, who used to gather in the Lloyd’s coffee house in London, agreed to

share the losses to their goods while being carried by ships. The losses used to occur because

of pirates who robbed on the high seas or because of occurs because of pirates who robbed on

the high seas or because of bad weather spoiling the goods or sinking the ship. In India,

insurance began in 1818 with life insurance being transacted by an English company, the

oriented Life Insurance Co. Ltd.... The first Indian Insurance company was the Bombay

Mutual Assurance Society Ltd, former in 1870 in Mumbai. This was followed by the Bharat

Insurance Co. in 1896 in Delhi the empire of India in 1897 in Mumbai, the United India in

Chennai, the National Indian and the Hindustan Cooperative in Kolkata.

Later , were established the Cooperative Assurance in Lahore, the Bombay Life (originally

called the Swadeshi Life), the Indian Mercantile, the New India and the Jupiter in Mumbai

and the Lakshmi in New Delhi. These were all Indian companies started as a result of the

swadeshi movement in the early 1900s. By the year 1956, when the life insurance business

was nationalized and the Life Insurance Corporation of India (LIC) was formed on 1st

September 1956, there were 170 companies and 75 provident fund societies transacting life

insurance business in India. After the amendments to the relevant laws in 1999, the L.I.C. did

not have the exclusive privilege of doing life insurance business in India. By 31.8.2007,

sixteen new lives insure had been registered and were transacting life insurance business in

India.

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SBI Life Insurance

India SBI Life Insurance Company Limited is a joint venture company formed between the State Bank of

India and BNP Paribas Assurance. State Bank of India owns 74% and BNP Paribas Assurance holds the

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remaining 26% of the stake of the joint venture as per the guidelines of the Indian government. State

Bank is the largest banking franchise in India and is beyond competition. Along with its seven associate

banks, SBI has the strength of over 14,500 branches across the country and the largest in the world.

Their presence is felt in the remotest parts of the country. BNP Paribas Assurance is the insurance arm

of BNP Paribas. It is one of the world's top 10 banks by the market value and one of Europe's top 3

banking companies. In fact it is one of the oldest foreign banks with its presence in India since 1860.

SBI Life is registered with a capital of Rs.2000 crore and a paid-up capital base of Rs.1000 corers.

SBI caters to over 100 million accounts across the country. It offers a great base for insurance

penetration across every region and economic strata in the country ensuring true financial inclusion. SBI

Life also follows the unique multi-distribution business model encompassing Bancassurance, Agency

and Group Corporate for its business. SBI Life is strongly supported by its skilled staff and sales force

allocated across the country. SBI Life comprise of the most productive force of more than 63,000

Insurance Advisors, offering door to door insurance solutions to customers. SBI Life uses SBI Group as

a platform for cross-selling insurance products to its already existing large customer base along with its

various banking product packages such as housing and personal loans. The company offers

comprehensive range of Life Insurance and pension products designed to meet the requirements of the

customers at competitive prices. It aims to provide high standard customer service and world class

insurance product.

TYPES OF SBI LIFE INSURANCE

Unit Linked Plans

SBI Life - Smart Performer SBI Life - Unit Plus Super SBI Life - Saral Maha Anand SBI Life - Smart Elite SBI Life - Smart Scholar

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Saving Plans

SBI Life - Money Back SBI Life - Sanjeevan Supreme SBI Life - Shubh Nivesh SBI Life - Saral Life

Pension Plans

SBI Life - Lifelong Pension Plan

Child Plans

SBI Life - Scholar II SBI Life - Smart Scholar

Protection Plans

SBI Life - Smart shield SBI Life - Saral shield SBI Life – Swadhan

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Life Insurance Life Insurance is a financial cover for a contingency linked with human life like death,

disability accident retirement etc. Human life is subject to risks of death and disability due to

natural and accidental causes. When human life is lost or a person is disabled permanently or

temporarily, there is loss of income to the household.

Though human life cannot be valued, a monetary sum could be determined based on the loss

of income in future years. Hence, in life insurance the Sum Assured (or the amount

guaranteed to be paid in the event of a loss) is by way of a ‘benefit’. Life Insurance products

provide a definite amount of money in case the life insured dies during the insured dies

during the term of the policy or becomes disabled on account of an accident.

Why you should buy Life Insurance:

All of us face the following risks:

Dying too soon

Living too long

Life insurance is needed:

To ensure that you’re immediate family has some financial support in the event of your

demise.

To finance your children’s education and other needs.

To have a savings plan for the future so that you have a constant source of income when your

earning are reduced due to serious illness or accident.

To provide for other financial contingencies and life style requirement.

Who needs Life Insurance

Primarily, anyone who has a family to support and is an income earner needs Life Insurance.

In view of the economic value of their contribution to the family, housewives too need life

insurance cover.

Even children can be considered for life insurance in view of their future income potential

being at risk.

How much Life Insurance is needed:

The amount of Life Insurance coverage you need will depend on many factors such as:

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How many dependants you have

Whether you have any debts or mortgages

What kind of lifestyle you want to provide for your family

How much you need for your children’s education

What your investment needs are

What your affordability is

You should seek the help of an insurance agent or broker to understand your insurance needs and suggest the right type of cover.

Kind of Life Insurance Policies :

Term Insurance

You can choose to have protection for a set period of time with Term Insurance, you are

guaranteed lifelong protection. Whole life insurance pays out a death benifit so you can be

assured that your family is protected against financial loss that can happen after your death. It

is also an ideal way of creating an estate for your heirs as an inheritance.

Whole Life Insurance

With whole life insurance, you are guaranteed lifelong protection. Whole life insurance pays

out a death benefit so you can be assured that your family is protected against financial loss

that can happen after your death. It is also an ideal way of creating an estate for your heirs as

an inheritance.

Endowment Policy

An Endowment policy is a saving linked insurance policy with a specific maturity date.

Should an unfortunate event by way of death or disability occur to you during the period, the

Sum Assured will be paid to your beneficiaries? On your surviving the term, the maturity

proceeds on the policy become payable.

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Money back plans or cash back plans:

Under this plan, certain percentage of the sum assured is returned to the insured person

periodically as survival benefit. On the expiry of the term, the balance amount is paid as

maturity value. The life risk may be covered for the full sum assured during the term of the

policy irrespective of the survival benefits paid.

Children policies

These types of policies are taken on the life of the parent/children for the benefit of the child.

By such policy the parents can plan to get funds when the child attains various stages in life.

Some insurers offer wavier of premiums in case of case of unfortunate death of the

parent/proposer during the term of the policy.

Annuity (pension) plans

When an employee retires he no longer gets his salary while his need for a regular income

continues. Retirement benefits like Provident Funds and gratuity are paid in lump sum which

are often spent too quickly or not invested prudently with the result that the employee finds

himself without regular income in his post-retirement days. Pension is therefore an ideal

method of retirement provision because the benifit is in the form of regular income. It is wise

to provide for old age, when we have regular income during our earning period to take care of

rainy days. Financial independence during old age is a must for everybody.

There are two types of annuities (pension plan)

Immediate annuity

In case of immediate Annuity, the Annuity payment from the Insurance Company starts

immediately. Purchase price (premium) for immediate Annuity is to be paid in iumpsum in

one installment only.

Deferred Annuity

Under deferred Annuity policy, the person pays regular contributions to the insurance

company, till the vesting age/vesting date. He has the option to pay as single premium also.

The fund will accumulate with interest and fund will be available on the vesting date. The

insurance company will take care of the investment of funds and the policyholder has the

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option to encase 1/3rd of this corpus fund on the vesting age/vesting date tax free. The balance

amount of 2/3rd of the fund will be utilized for purchase of Annuity (pension) to the

Annuitant.

Unit Linked Insurance Policy

Unit Linked Insurance Policy (ULIPs) offer a combination of investment and protection and

allow you the flexibility and choice on how your premiums are invested. IN UNIT LINKED

PLANS, THE INVESTMENT RISK PORTFOLIO IS BORNE BY YOU AS YOU ARE

THE INVESTOR.

Typically, the policy will provide you with a choice of funds in which you may invest. You

also have the flexibility to switch between different funds during the life of the policy. The

value of a ULIP is linked to the prevailing value of units you have invested in the fund, which

in turn depends on the fund’s performance. In the event of death or permanent disability, the

policy will provide the Sum Assured (to the extent you are covered) so that you can take

comfort in knowing that your family is protected from sudden financial loss. A ULIP has

varying degree of risk and rewards. There are various charges applicable for Unit Linked

Policies and the balance amount out of the premium is only invested in the fund/funds chosen

by you. It is important to assess your risk appetite and invested horizon before deciding to

buy a ULIP policy. You must also read the terms and conditions of the policy including the

lock-in period, surrender value surrender charges etc.

All the type of plans mentioned above can be offered under ULIP plans.

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CONVENTIONAL LIFE INSURANCE

Q} What should I look for before I decide to buy a policy?

A} You must check and see whether or not there is availability of guarantee of return, what

the lock in period is, detail of premium default, what the revival conditions are what the lock

in period is, details of premium default, what the revival conditions are what the policy terms

are what are the charges that would be deducted, would be available etc.

Q} What is the important of proposal for and the disclosers made therein?

A} The disclosers made in a proposal are the basis for underwriting a policy and therefore

any wrong statements or disclosures can lead to denial of a claim.

Q} What are special medical report required to be submitted in Life insurance?

A} In case of certain proposals, depending upon the age of entry, at maturity, sum assured,

family history and personal history, special medical reports may be necessary for

consideration of a risk. E.g. if the proposer is overweight, special reports like Electro

Cardiogram, glucose tolerance test etc could be required, while for underweight proposers X-

ray of the chest and lungs with report could be required.

Q} What is meant by paid-up value in Conventional Life Insurance Policy?

A} After premium are paid for a certain defined period or beyond and if subsequent premium

are not paid, the sum assured is reduced to a proportionate sum, which bears the same ratio to

the full sum assured as the number of premiums actually paid bears to the total number

originally stipulated in the policy. For example, if sum assured is 1lakh and the total number

of premiums is payable is 20 (20years policy, mode of premiums is assumed yearly) and

default occurs after 10years premium are paid the policy acquires the paid up value of

50,000. Paid up value = No. of Premiums paid/ No. Of premium payable X S.A= 10/20X

100000 = 50000. This means that the policy is effective as before except that from the date

the 11th premium was due the sum assured is 50000 instead of 100000. To this sum assured

the bonus already vested before the policy lapsed, is also added. Example if the bonus

accrued up to the date of lapse is 35000 the total paid up value is 50000+35000 = 85000.

Q} How is Surrender Value calculated in Conventional Life Insurance Policy?

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A} Surrender Value is allowed as a percentage of this paid up value. Surrender value is

calculated as per the surrender value factor, which depends on the premium paid and elapsed

duration.

Q} How is the loan on policy calculated under Conventional Life Insurance Policies?

A} If the policy condition permits grant of loan, loan is sanctioned as a percentage of the

Surrender Value.

Q} What are the requirement to be submitted in case of a Maturity Claim?

A} Usually the Insurance Company will send intimation attaching the discharge voucher to

the policy holder at least 2 to 3 months in advance of the date of maturity of the policy

intimating the claim amount payable. The policy bond and the discharge voucher duly signed

and witnessed are to be returned to the insurance company will be able to make payment. If

the policy is assigned will be paid only to the assignee that will give the discharge.

Q} What is meant by settlement options?

A} Settlement option means the facility made available to the policy holder to receive the

maturity proceeds in a defined manner (the terms and condition are specified in advance at

the inception of the contract).

Q} What documents are generally required to be submitted in case of death of life assured

while the policy is in force?

A} The basic document that are generally required are death certificate, claim form and

policy bond, other document such as medical attendant’s certificate, hospital certificate ,

employer’s certificate, hospital certificate, employer’s certificate, police inquest, post mortem

report etc could be called for, as applicable. The claim requirement are usually disclosed in

the policy bond.

Q} How is Surrender value calculated in Unit Linked Policies?

A} Surrender value is usually expressed as fund value less the surrender charge.

Q} What is the method of arriving at NAV for surrenders, maturity claim, switch etc?

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A} In respect of valid application received up to 3.00 by the insurer, the insurer, the same

day’s closing NAV is applicable.

In respect of valid applications received after 3.00 p.m. by the insurer, the closing NAV of

the next business day is applicable.

Q} What is a Unit Fund?

A} The allocated portions of the premiums after deducting for all the charges and under all

policies in a particular fund as chosen by the policy holder are pooled together to form Unit

Fund.

Q} What is a Unit?

A} It is a component of the Fund in a Unit Linked Policy.

Q} What type of funds do ULIP offer?

A} Most insure offer a wide range of funds to suit one’s investment objectives, risk profile

and time horizons. Different funds have different risk profile. The potential for returns also

varies from fund to fund.

Q} Are Investment Return Guaranteed in a ULIP?

A} Investment return from ULIP may not be guaranteed. “In unit linked products the

investment risk in investment portfolio is borne by the policy holder”. Depending upon the

performance of the unit linked fund chosen; the policy holder may achieve gains or losses on

his/her investments. It should also be noted that the past returns of a fund are not necessarily

indicative of the future performance of the fund.

Q} What are the charges, fees and deductions in a ULIP?

A} ULIPs offered by different insures having varying charge structures. Broadly, the

different types of fees and charges are given below. However it may be noted that insurers

have the right to revise fees and charges over a period of time.

Premium Allocated Charge

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This is a percentage of the premium appropriated towards charge before allocating the units

under the policy. The charge normally includes initial and renewal expenses apart from

commission expenses.

Mortality Charges

These are charges to provide for the cost of insurance coverage under the plan. Mortality

charges depend on number of factors such as age, amount of coverage, state of health etc.

Fund Management Fees

These are fees levied for management of the funds and are deducted before arriving at the Net

Asset Value.

Policy Charges

These are the fees for administration of the plan and levied by cancellation of units. The

could be flat throughout the policy term or vary at a pre-determined rate.

Surrender Charge

A surrender charge may be deducted for premature partial or full encashment of units

wherever applicable, as mentioned in the policy conditions.

Fund Switching Charge

Generally a limited number of funds switches may be allowed each year without charge, with

subsequent switches, subject to a charge.

Service Tax Deduction

Before allotment of the unit the applicable service tax is deducted from the risk portion of the

premium.

Q} What should one verify before signing the proposal?

A} One has to verify the approved sales brochure for

All the charges deductible under the policy

Payment on premature surrender

Feature and benefits

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Limitation and exclusion

Lapsation and its consequences

Other disclosures

Illustration projecting benefits payable in two scenarios of 6% and 10% returns as

prescribed by the life insurance council.

Q} How much of the premium is used to purchase units?

A} The full amount of premium paid is not allocated to purchase units. Insures allot units on

the portion of the premium remaining after providing for various charges, fees and

deductions. However the quantum of premium used to purchase units varies from product to

product.

The total monetary value of the units allocated is invariable less than the amount of premium

paid because the charges are first deducted from the premium collected and the remaining

amount is used allocating units.

Q} Can one seek refund of premiums if not satisfied with the policy, after purchasing it?

A} The policyholder can seek refund of premiums if he disagrees with the terms and

conditions of the policy, within 15 days of receipt of the policy documents. The policyholder

shall be refunded the fund value including charges levied through cancellation of units

subject to deduction of expenses towards medical examination, stamp duty and proportionate

risk premium for the period of cover.

Q} What is Net Assets Value?

A} NAV is the value of each unit of the fund on a given day. The NAV of each fund is

displayed on the website of the respective insurers.

Q} What is the benefits payable in the event of risk occurring during the term of the policy?

A} The Sum Assured and value of the fund units is normally payable to the beneficiaries in

the event of risk to the life assured during the term as per the policy condition.

Q} What is the benefit payable on the maturity of the policy?

A} The value of fund units with bonuses, if any is payable on maturity of the policy.

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Q} Is it possible to invest additional contribution above the regular premium?

A} Yes, one can invest additional contribution over and the regular premium as per their

choice subject to the feature being available in the product. This facility is known as “TOP

UP” facility.

Q} Can one switch the investment fund after taking a ULIP policy?

A} Yes, “SWITCH” option provide for shifting the investments in a policy from one fund to

another provided the features is available in the product. While a specified number of

switching are generally effected free of cost, a fee is charged for switches made beyond the

specified number.

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COMPANY PROFILEAbout the Company:SBI Life Insurance is a joint venture between State Bank of India and BNP Paribas Cardiff.

SBI owns 74% of the total capital and BNP Paribas Cardiff the remaining 26%. SBI Life

Insurance has an authorized capital of Rs. 2000 cr. and a paid up capital of Rs. 1000 cr. State

Bank of India enjoys the largest banking franchise in India.

Along with its 5 associate banks group has the unrivalled strength of over 20000 branches

across the country, arguably the largest in the world. BNP Paribas, one of the leading banks

in Europe, ranks 5th in the banking industry worldwide. It is the 6th most valuable

international banking brand as per Brand Finance 2008. BNP Paribas Cardiff is the insurance

arm of BNP Paribas- Euro Zone’s leading Bank. It is one of the leading life insurers in

France, and a worldwide leader in Creditor insurance products. SBI Life’s mission is to

emerge as the leading company offering a comprehensive range of life insurance and pension

products at comprehensive range of life insurance and pension products at competitive price,

ensuring high standards of customer service of customer service and world class operating

efficiency.

SBI Life has a unique multi-distribution model encompassing vibrant Banscassurance, Retail

Agency, and Institutional Alliances and Corporate Solutions distribution channels.

SBI Life extensive leverage the State Bank Group relationship as a platform for cross-selling

insurance product packages such as housing loans and personal loans. SBI’s access to over

100 million accounts across every regions and economic strata in the country, thus financial

inclusion. Agency Channel, comprising the most productive force of over 85000 Insurance

Advisors, offers door to door insurance solution to customers.

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Vision :  "To be the most trusted and preferred life insurance provider " 

Mission:  "To emerge as the leading company offering a comprehensive range of life insurance and pension products at competitive prices, ensuring high standards of customer satisfaction and world class operating efficiency, and become a model life insurance company in India in the post liberalization period".  

Values :

• Trustworthiness• Ambition• Innovation• Dynamism• Excellence

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Major benefits• An infrastructure that can support broad information integration for the enterprise portal,

relational databases, business intelligence, and enterprise content management applications

• Unified portal creation and administration across the enterprise. 

• A Web services-based service oriented architecture that delivers Web services and the

ability to unlock existing assets as re-usable Web services.

 • Projects that were previously shelved due to high integration costs can now

come off the shelf and show immediate ROI Products and technologies used.

• Onlinesbilife.com is implemented on BEA Web logic Platform 8.1 with Oracle 9.1 as

a backend.

• Tuxedo acts as a middleware to integrate the Web-based application with the Indigo engine.

• The core insurance engine is Indigo; the entire business logic from processing the proposal

to policy issuance and policy servicing resides in Indigo. 

• Behaviour tracking of user, group and profile management based on LDAP, RDBMS,

legacy or a combination

• Rules management for segmentation, content selection and entitlement at the Port let or

page level. 

• Web flow and pipeline MVC architecture. 

• Support for CSS-based skins and multi-channel portals. 

• Broadband Internet connectivity to a central server from all over the country. 

• Security is addressed with Nortel/Alton switch and Checkpoint network Security software. 

• Strategy, architecture, design and implementation was done by SBI Life's IT team. 

• E-business infrastructure software was undertaken by BEA Systems.

• Software design and development was done by Satyam.

 • Security was handled by Nortel and Check Point

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INSURANCE INDUSTRY IN INDIA

1. ICICI Prudential: Its a joint venture of ICICI bank, one of the biggest bank of India and

Prudential PLC, a financial monster from Britain with 74% and 26% holding respectively.

ICICI Prudential has over 1500 offices nationwide and it holds the total asset of over $13

billion.

2. STATE BANK OF INDIA:

State Bank of India (SBI) is one of the largest Indian banks. On the trailing four quarters it

reported profit of Rs 7,677 crore. The bank has been able to post good bottom line growth

primarily because of improvement seen in its net interest margin (NIM). For the December

quarter of 2012, the bank’s NIM increased by 44 basis points to 4.05 per cent, which is one of

the best in the industry. For the trailing four quarters the bank is facing headwinds in posting

good bottom line mainly because of higher provisioning. It is facing asset quality pressure

which is evident from the fact that for the December quarter of 2011 the net NPA of the bank

increased by 61 basis points to 2.22 per cent on a Yoyo basis while on a sequential basis it

increased by 18 basis points. SBI is currently trading at a book value of around 2x which

should be considered as fairly valued.

Mr. Mahadev Nagendra Rao (MD & CEO)

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3. Bajaj Allianz: A joint venture between two big companies, Bajaj Group and Allianz AG.

Headquartered in Pune, the company is one of the fastest growing general and life insurance

Company in India with over 1200 branches across India and variety of services in insurance

sector.

4. Tata AIG: Another joint venture from India's monster Tata Group and America's

insurance specialist, AIA (American International Assurance). Started operations in 2001, the

stock holding is 74% and 26% for Tata and AIA respectively. It works in almost every

verticals in its sector.

5. Aviva India: Started its operation in 2002, it’s a joint venture between world's insurance

mosnter Aviva and India's Dabur Group with a stock sharing of 26% and 74% respectevely.

It has over 160 branches in India and employee strength of over 5000. Apart from that, Aviva

has already has associates in over 70 countries.

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6. MetLife India: "Have you met life today?" this signature line is from Metropolitan Life

Insurance Company, commonly known as MetLife. Founded in 1868 in New York, the

company is one of the oldest life insurance company in the world and with a turnover of

around $53 billion, its a market leader in terms of revenue.

7. Max New York Life Insurance: Founded in 2000 and started its operation in 2001, Max

New York Life Insurance is a joint venture between Max India Ltd and New York Life

Enterprise. With over 25 life insurance policies, it has a turnover of around $400 million.

Mr. Rajesh Sud (CEO & Managing Director).

8. ING Vysya Life Insurance: Also known as ING Life, the company is headquartered in

Bangalore. Started its operations in 2001, the company recently has completed a decade in

India. Its a joint venture between Exide Industries and ING Insurance International BV. With

over 1 million customers, it has presence in over 200 cities in India. Mr. Rajan Raheja

(Chairman), Mr. Satish Raheja (Director).

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9. AEGON Religare Life Insurance: Its a joint venture among AEGON - an international

life insurance company, Religare - world's financial service leader and India's financial

service group, Bennett, Coleman and Company. Started its business in 2008, the company

has gain good market share in short span of time.

9. Birla Sun Life: Its a joint venture between Aditya Birla Group and Sun Life Financial

from canada. Established in 2000, the company has experience of over 10 years. It has a

network of over 600 branches across India, covers 1500 cities, around 1350000

life advisers and has revenue of over $500 million. Mr. Jayant Dua (MD & CEO).

11. Bharti AXA Life Insurance: Started in 2006, its a joint venture between Bharti

Enterprise - a leading telecom company in India (Airtel) and AXA Group - an international

market leader in insurance sector. With 74% and 26% market share respectively.

With presence in all over India, the company provides many services in all verticals.

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PURPOSE AND NEED FOR INSURANCE

Functions of Life Insurance: -

a) Protection

The four hazards against which life insurance offers protection are:

Death

Disability

Disease

Destitution

b) Means of Savings

Life insurance is a sound method of savings. In all other savings, there is always

temptation to withdraw. However, there are in-built provisions under a life insurance

policy (such as paid-up value, surrender value etc.) which discourage the person from

discontinuing a policy. The contracts of life insurance are of long duration, which is an

element of encouragement to thrift and compulsion for saving.

c) Prudent Investment

Returns under a life insurance policy are comparatively lower than other financial

instruments in the market. However, in view of its very sound investment policy and

accumulation of a vast life fund, the ‘Security’ of funds is very high. Further ‘Liquidity’

under life insurance policy is also guaranteed due to provisions of survival benefit, loans,

surrender values etc.

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(d) Tax-saving instrument

Premiums under life insurance and annuity policies secure attractive tax benefits.

These get substantial rebates under Income tax, Wealth tax, Gift Tax etc. The proceeds of

life insurance policy are exempt from Income tax and Wealth tax.

(e) Business Protection

Large numbers of business houses are of proprietary nature. With the untimely death

of proprietor, the business can be wiped out due to debts, un-recovered bills and inability

of heirs to carry on the business. A proper planning with the help of life insurance can

save such business and enhance their “goodwill” value.

(f) Best Collateral

No other financial instrument can compete with life insurance as sound collateral.

By going in for life insurance one creates an instant estate, which can be used as collateral

against housing loans and other business loans.

(g) Relieves Anxiety and Promotes Initiative

This is a hidden but very significant benefit of life insurance plan for an individual. A

man is not prone to take risk for security considerations. But once he is assured of basic

minimum security, he is inclined to take risks and launch any entrepreneurial activity. Life

insurance takes care of one of his biggest worries and thus enables him to embark upon new

initiatives.

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UNDERWRITINGOBJECTIVE

What is meant by underwriting Why is important in insurance How it is done in life insurance Medical and non-medical underwriting

A proposal is an application for an insurance cover. When a proposal is received, the

insurance will not grant the cover automatically. The insurer will make a decision as to

the admissibility of the proposer to the pool of policyholder. This is because of the

insurer’s role as a trustee. It has to ensure that every new entrant into pool has similar

exposure to the risks as the others. The process of verifying the level of risk in each new

entrant and determining the terms of admission is called “selection” or “underwriting”.

The underwriting process is an important one in any insurance office, life or none is

appropriate. A lower premium affects the solvency of the fund. The cost of the additional

risk, not recovered from the proposer would have to be borne by the rest of the

policyholders. That is not be fair to the proposer, because of the principle of utmost good

faith. “Underwriting” has implications of fairness to the insurer and to policyholders,

individually and collectively.

If the underwriter finds that the individuals proposed to be insured has no adverse

features affecting mortality and other factors relating to insurability, the risk is considered

as a normal or standard or first class life. The premium charged would be as per tabular

rates. Otherwise, the term of acceptances of the proposal would be different.

Financial underwriting

One of the indicators of moral hazards is the size of the insurance proposed compared to

the income. The extent of insurable interest of a person in his own life is unlimited. It is

not limited to his current levels of income because it is assured that this level can go up at

any time. There is nothing that prevents a petrol pump attended becoming the biggest

industrialist of the country or those sleeping on the footpaths becoming rich film stars.

Yet, the premium on the insurance policy has to be paid regularly. If it is being paid from

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current income, then the source of the premium needs to be checked. If someone else is

paying for it, there could be issues of insurable interest and wager. The need for insurance

has to be related to current situations and not to a desirable situation of the future. When

the premium paid is large compared to the income there also possibilities of higher claims

money laundering and fraud. The underwriting has to be satisfied to these counts. Making

a judgment on these financial aspects is called financial underwriting. Thumbs rules like

‘insurance not more than 10 years income’ are guidelines, but may not do justice in all

cases.

NON MEDICAL UNDERWRITING:

Insurance have found that after medical examination, more than 90% proposals are

accepted as proposal at O.R. future, medical examinations from qualified doctors were

not easy in all the places. Even in urban areas, the prospects had to go and wait at the

doctor’s first priority. Therefore, over the years, the LIC had been underwriting proposals

without any medical examination, replying entirely on the personal statements and

declarations made by the proposer.

Other insurance also have followed the practice of doing away with medical

examinations, subject to some restrictions. The restrictions are usually with regard to

limits on (i) age (ii) SA (iii) plan and (iv) nature of employment. In the case of the L.I.C

which has extended these limited to less than 45 years. The SA, limited to less is Rs.1

lakh in most cases.

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Indian Scenario

BI LIFE LEADS GLOBALLY AT MILLION DOLLAR ROUND TABLE (MDRT) 2011

Mumbai, September 28, 2011 - SBI Life Insurance, the leading private life insurer,

retains the unique distinction of being the only Life Insurer from India, topping the

prestigious Million Dollar Round Table (MDRT) 2011 across the globe. For the third

consecutive year, SBI Life has reached the pinnacle of the international coveted league

by having 2,661 MDRT members in 2011. Amongst these, 200 have achieved Court of

Table (COT) and 30 Top of Table (TOT) membership statuses. SBI Life has been

consistently featuring amongst the top five insurers, worldwide, since last five years.

Globally, the company ranked 5th in 2007, 3rd in 2008,1stin2009,2010and2011.

Reputation, standard of sales excellence and high ethical standards are some of the key

values that are associated with the MDRT brand. The MDRT membership is an exclusive

honour that is achieved by less than 1 percent of the world's life insurance and financial

services advisors. Life Insurance professionals aspire to attain the privilege of being an

MDRT member.

Mr. M. N. Rao, MD & CEO, SBI Life, said, "Across the globe, both, Agent and

Insurance Facilitator at bank, continue to be a reliable source of personal financial advice.

Our accomplishment on a global platform testifies the professional approach followed by

our distributors. We will continue to focus on equipping them with relevant support

to enable advisory-based delivery of life insurance solutions to our customers."

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Mr. Rajiv Gupta, Executive Director, Marketing, and SBI Life added "This

accomplishment resonates our commitment towards creating quality advisors who can be

looked upon as world-class benchmarks. Providing need based solutions, professional

advice and unmatched service will remain the focal delivery points for our Advisors ".

An opportunity to represent one of the most trusted brands in the country, superior

training program and attractive reward and recognition programmes are some of benefits

availed by SBI Life Insurance Advisors.

Uniquely, despite tough external conditions, SBI Life continues to expand its presence.

During the current financial year, the company has introduced 81 branches and recruited

1657 employees.

SBI Life ranks number one amongst private players, as per the latest IRDA report, July

2011. The company has a market share of 21.6% among private life insurers and a total

market share of 6%.

AboutMDRT:

MDRT is an association of the world's best life insurance sales (advisors) professionals.

Founded in 1927, MDRT is an international, independent association of nearly 36,000 of

the world's leading life insurance and financial services professionals from 76 nations and

territories, representing over 450 companies. MDRT members are recognized as skilful

professionals who are considered to be among the best in the industry, perform

outstanding client service, and have achieved the highest standard of sales excellence in

the life insurance and financial services business.

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RESEARCH METHODOLOGY

INTRODUCTION

Research Methodology is way to systematically solve the research problem. In it we study the

various steps that are generally adopted by a researcher in studying his research problem

along with logic behind them .We also need to understand the assumption underlying various

techniques and procedures will be applicable to certain problems and other will not. So it is

necessary for us to design methodology for the problem as it differs from problem. So

research methodology is not only method research but also logic behind the methods we use

in context of our research study and explain why we are using a particular method or

technique and why we are not using others so that research results are capable of being

evaluated.

Marketing research is the systematic design, collection, analysis and reporting of data

and findings relevant to specific marketing situation facing the company.

An effective marketing research involves following five objectives.

Developing research plan. Steps in a sequential manner.

Defining the research.

Collecting the information.

Analyze the information.

Present the findings

DEFINNING RESEARCH OBJECTIVE:

Objective is the main theme of in, which is my job, is based. Research is a good planning of

strategy, policy and formulation of procedure to compete in the market. The objective of the

project should be very precise; it should neither be very broad nor be very narrow.

DEVELOPING RESEARCH PLAN:

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The research plan is the main body or you can call the blue print in whichwe carry the

research. The research plans consist of data sources, research approaches, research

instruments, sampling plan and contact methods.

1. DATA SOURCES:

I have gathered secondary data. Secondary data are the data, which already exists and were

collected for some other purpose or for similar previous studies. Primary data are the data

gathered for the specific research project and are directly taken from the very source of

information. For this research secondary data were used for making assumption and the

outline of the project. Secondary data were proved to be instrumental in structuring the

questions to be asked for collecting primary data. The secondary data used here were in the

form of previous reports, sales record of the company and the sales history of the competitor

and this was the information on which the final report is based on.

2. RESEARCH APPROACH:

Primary data can be collected in several different ways these methods of

collecting primary data are called research approaches. Research approaches are of

following types:

a) Observational research

b) Focus group research

c) Survey research

d) Experimental research.

e) Behavioral data research

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FINDINGS

Findings

During my project I have found out various things by which I have learned a lot. As insurance is one of the toughest sectors in business world and we are the dream sellers in the industry because we never give the customers return in that very day we are assuring some amount so its all about faith on we people which customers are suppose to do.

General View(1) Promotional tools which are being used are not so much effective.(2) Customers are much more relying upon LIC.(3) Less customer awareness regarding SBI LIFE Insurance.(4) It still not penetrates in rural area.(5) Product variety is very less.(6) All products are not attractive to the customers so that kind of products are very hard to sale.(7) Investment plans are very less, that s why people are not accepting the products.(8) Competitors are very tough.(9) Brand name helped quite a lot to the company.

Positive view1. Brand name helped a lot while financial advisors are opting for calling.2. Branches are almost everywhere.3. Higher level of advertising and all are very effective4. Advertising through all media.

Negative view1. Customers are much more relying upon LIC.2. People don’t rely upon private insurance sector.3. Competitors are very tough.4. All products are not attractive to the customers so that kind of products are very hard to sale.5. Less number of traditional plans that’s why people who really need traditional plans are still not satisfied.

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CONCLUSION

Truly speaking neither an insurance policy nor any other investment can replace the other.

One must have both for a complete, intelligent and a secure portfolio. Comparing one

investment with other is like comparing oranges with apples. Investments deal with

attempting to capitalize on calculated risk. Working with SBI LIFE INSURANCE was a very

nice and a good learning experience. It has helped me a lot learning about different kinds of

investments and the pros-corns of its. It has also helped me to know about how to works in a

corporate world is done.

RECOMMENDATIONSGiven the current level of dissatisfaction experienced by customers, it is the time for SBI

LIFE Insurance to concentrate on providing high quality services for differentiating their

offerings. Some areas on which they should concentrate immediately are:-

Gear up sales services particularly those that will help in reducing customer anxieties.

Simplify documents wherever necessary, without loosing control.

Enhance post sales services in such areas as sending all renewal notices in time,

expeditious settlement of claims and refunds etc. Customize products to cater to the

needs of each individual.

Emphasize with the customers. Employees coming in contact with customers must

show courtesy and good behavior.

To deliver the above, will need to build the suitable organization with an appropriate

management system, optimum physical infrastructure and a culture of innovation,

productivity and customer-orientation that will enable them to survive and grow in

exciting and fast growing line of personal insurance.

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BIBLIOGRAPHY

Web Site : http://www.sbilife.co.in/sbilife/content/83425

http://www.moneycontrol.com/news-topic/sbi-life-insurance-

Magazines: The Times of India The Economic Times

Fri,23 Dec 2012

Business-standard Finance » News » Insurance

Priya Nair   Mumbai  November 28, 2012

Newspaper : Hindustan Times  Live Hindustan  

Wed,04 Jan 2013

Books: IC – 33 LIFE INSURANCE (IRDA) jeevan bema

Pathak Umesh Chandra , bharati bema sasthan,

Insurance Institute of India- 2007

IC – 33 LIFE INSURANCE (IRDA) Life Insurance

Chandra S. Bala

Insurance Institute of India-2008

Management Paradise

SBI Life Insurance - January 11th, 2008

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