8/4/2019 FINAL MRP AZISH 28-09-2011

1/61

A COMPARATIVE STUDY OF THE CUSTOMER

SATISFACTION OF LIC AND BAJAJ ALLIANZ IN

INDORE CITY

For Major Research Project Submitted to

Devi Ahilya Vishwavidyalaya

As a partial fulfillment for degree of

Master in Business Administration

Supervised By: Submitted By:

Prof. Kiran Agrawal Azish Khan

Faculty CHIM Roll no. CHIM/2009-2011(MBA)/133

MBA 4th SEM.

8/4/2019 FINAL MRP AZISH 28-09-2011

2/61

CH. INSTITUTE OF MANAGEMENT

Indore

TABLE OF CONTENT

S.NO PARTICULAR PAGE.NO.

1 INTRODUCTION

1.1 Preliminaries

1.2 Review of Literature

1.3 Rationale

1.4 Objectives&Scope

1.5 Profile

2 METHODOLOGY

2.1 Hypothesis

2.2 Tools Applied for Testing Hypothesis

3 DATA COLLECTED

3.1 Data Collection Techniques used

3.2 Population&Sample

3.3 Sampiling Techmiques

8/4/2019 FINAL MRP AZISH 28-09-2011

3/61

4 EMPIRICAL ANALYSIS

4.1 Data Analysis Techniques

4.2 Result&Findings

5 RECOMMENDATIONS

6 CONCLUSION

7 APPENDIX

7.1 Questionnair

7.2 SPSS Sheet for Data Analysis

7.3 Data Spread Sheets containing all variables

8 BIBLIOGRAPHY/REFRENCECES

CERTIFICATE OF THE GUIDE

This is to certify that the Project Work titled A COMPARATIVE STUDY OF THE

CUSTOMER SATISFACTION OF LIC AND BAJAJ ALLIANZ IN INDORE CITY is a

bonafide work of AZISH KHAN [Roll No: CHIM/2009-2011(MBA)/133] carried out in

partial fulfillment for the award of degree of [MASTER OF BUSSINESS

ADMINISTRATION] of[DEVI AHILYA VISHWAVIDYALAYA] under my guidance. This

project work is original and not submitted earlier for the award of any degree / diploma or

associate ship of any other University / Institution.

8/4/2019 FINAL MRP AZISH 28-09-2011

4/61

Place : INDORE Signature of the Guide

Date :

ACKNOWLEDGEMENT

It gives me a great pleasure to acknowledge all, who contributed in some way or the other

towards the success of my project.

I express my deepest sense of gratitude, profound respect and sincere thanks to Prof. Kiran

Agrawal Faculty of C.H. Institute of Management, for providing me this wonderful

opportunity.

I express my sincere thanks to all others who directly or indirectly helped me in the execution of

the project.

8/4/2019 FINAL MRP AZISH 28-09-2011

5/61

DECLERATION

I, Azish khan here by declared that the project report entitled A

COMPARATIVE STUDY OF THE CUSTOMER SATISFACTION OF LIC

AND BAJAJ ALLIANZ IN INDORE CITY done by me under the guidance of

Pro. Kiran Agrawal [Faculty] is submitted in partial fulfillment of the requirement

for the award of the degree in MBA.

DATE: SIGNATURE OF THE CANDIDATE

8/4/2019 FINAL MRP AZISH 28-09-2011

6/61

PLACE: INDORE

1. INTRODUCTION

1.1 PRELIMINARIES

The Service Sector has assumed greater economic importance over past decade.India is 15 in

services output.It provides employment to 23% of work force and it growing fast,growth rate

7.5% in 1991-2000 up from 4.5% in 1951-1980.It has the largest share in GDP,according for

60.7 % in 2006 up from 15% in 1950.According to data for the financial year 2006-2007, the

share of services, industry, and agriculture in India's GDP is 55.1 per cent, 26.4 per cent, and

18.5 per cent respectively. The fact that the service sector now accounts for more than half the

GDP marks a watershed in the evolution of the Indian economy and take it closer to the

fundamental of a developed economy. Services or the "tertiary sector" of the economy covers a

wide gamut of activities like trading, banking & finance, insurance, real estate, transportation,

security, management & technical consultancy among several others.LIC contribute 4 percent of

the total GDP of the india.

The Life Insurance Corporation of India (LIC) is the largest state-owned life insurance company

in India, and also the country's largest investor. It is fully owned by the Government of India. It

also funds close to 24.6% of the Indian Government's expenses. It has assets estimated of 9.31

trillion (US$206.68 billion). It was founded in 1956 with the merger of more than 200 insurance

companies and provident societies. Headquartered inMumbai, financial and commercial capital

of India, the Life Insurance Corporation of India currently has 8 zonal Offices and 101 divisional

offices located in different parts of India, at least 2048 branches located in different cities and

towns of India along with satellite Offices attached to about some 50 Branches, and has a

network of around 1.2 million agents for soliciting life insurance business from the public.

http://en.wikipedia.org/wiki/Life_insurancehttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Government_of_Indiahttp://en.wikipedia.org/wiki/United_States_dollarhttp://en.wikipedia.org/wiki/Mumbaihttp://en.wikipedia.org/wiki/Mumbaihttp://en.wikipedia.org/wiki/Indian_rupeehttp://en.wikipedia.org/wiki/Life_insurancehttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Government_of_Indiahttp://en.wikipedia.org/wiki/United_States_dollarhttp://en.wikipedia.org/wiki/Mumbai

8/4/2019 FINAL MRP AZISH 28-09-2011

7/61

BAJAJ Allianz Life Insurance Company is a joint venture between two leading

conglomerates,Bajaj Auto Limited, one of largest manufactures of motorcycles and scooters in

the world, and Allianz AG of Germany one of the largest insurance companies. Bajaj Allianz

Life Insurance Co. Ltd. was incorporated on 12th March 2001. The company received the

Insurance Regulatory and Development Authority (IRDA) certificate of Registration (R3) No

116 on 3rd August 2001 to conduct Life Insurance business in India.

Customer satisfaction is a term frequently used in marketing,It is a measure of how products and

services supplied by a company meet or surpass customer expectation. Customer satisfaction is

defined as "the number of customers, or percentage of total customers, whose reported

experience with a firm, its products, or its services (ratings) exceeds specified satisfaction

goals.Customer satisfaction provides a leading indicator of consumer purchase intentions and

loyalty.

1.2 REVIEW OF RELATED LETERATURE

MS. BABITA YADAV (2011):The study is attempts to measure customer satisfaction level on

various Insurance services offered by LIC and also examine the reasons for customer

dissatisfaction. The study is empirical based and the primary research conducted through a

market survey consisting of 100 respondents of Jabalpur city of Madhya Pradesh. A well

structured questionnaire and Interview method were used for primary data collection. Simplestatistical tools like percentage and scaling techniques were employed for data analysis.

Customer satisfaction, Customer perception and various quality dimensions of LIC are the main

focus of the study. The study is significant also because it will help LIC to create a positive

impact on its customers by working on its lacking qualities. Customers are the main pillars of

any business and customer service is the critical success factor in a company and providing

outstanding customer service differentiates great customer service from indifferent customer

service

Dr. Masood H Siddiqui(2010): Liberalization of the financial services sector has led to insurance

companies functioning increasingly under competitive pressures; so companies are consequentlydirecting their strategies towards increasing customer satisfaction and loyalty through improved

service quality. The present study strives to develop a valid andreliable instrument to measure

customer perceived service quality in life-insurance sector. The resulting validated instrument

comprised of six dimensions: assurance, personalized financial planning, competence,corporate

image, tangibles and technology. The gap scores show that there is ample room for improvement

in all the aspects related to service quality. These results would help the service managers to

http://en.wikipedia.org/wiki/Marketinghttp://en.wikipedia.org/wiki/Marketing

8/4/2019 FINAL MRP AZISH 28-09-2011

8/61

efficiently allocate attentionand resources among these dimensions on the differential basis,

consistent with the customer priorities. These findings can be transformed into effective

strategies and actions for achieving competitive advantage through customer satisfaction and

retention..

Rand, Graham K(2004) There is widespread customer dissatisfaction in the insuranceindustry,stemming from insurers failure to satisfy customers needs Therefore, further research

to improve the industrys understanding of service quality is required. Using data from the Greek

and Kenyan insurance industries, service qualityis measured using the

SERVQUAL methodology to identify quality determinants and existing quality gaps in the

industries. Quality improvement strategies are recommended in each case. Some observations

are made on the efficacy of the SERVQUAL diagnostic in assessing service quality in the

insurance industry. Quality gaps that obtained in the insurance industries of Greece and Kenya

were largely similar. The dimensions reliability and empathy were the most deficient, and any

genuine quality intervention strategy should prioritize their improvement.

Guilln, M., Perch-Nielsen, J.; Prez-Marn, A.M. (2009): Customer loyalty is one of the main

business challenges, also for the insurance sector. Nevertheless, there are just a few papers

dealing with this problem in the insurance field and specifically considering the uniqueness of

this business sector. In this paper he define the conceptual framework for studying this problem

in insurance and he propose a methodology to address it. With his methodological approach, it is

possible to estimate the probability that a household with more than one insurance contract

(policy) in the same insurance company (cross-buying) would cancel all policies simultaneously.

For those who cancel part of their policies, but not all of them, he estimate the time they are

going to stay in the company after that first policy cancellation, that is to say, the time the

company has to try to retain a customer who has just given them a clear signal of leaving the

company. He consider the subset of customers with more than one policy before the first

cancellation, 77,337 households. He firstly apply a logistic regression model to this subset in

order to estimate the probability of a total cancellation. Among those 77,337 households, 66,695

of them make a partial cancellation. For that second subset of customers he estimate the

customer lifetime duration applying a Cox model This analysis includes two stages where he

identify the factors with a negative influence on the insurance customer loyalty: the estimation of

the probability that the customer would decide not to renew the contract (total cancellation) and

the study of the customer lifetime duration after the first time the client decides not to renew the

contract.

.

Govind Johri (2009) Customer satisfaction is a multi facted area on any public service

business.Customer satisfaction is most important criterion,which ecompasses quality product and

value addition through value evidence of what was implied to provide ultimate customer

satisfaction.Customer(dis) satisfaction is cascading in nature and requires building relationship

8/4/2019 FINAL MRP AZISH 28-09-2011

9/61

of confidence and trust with utmost commitment ,internal accountability and a sense of care of

customer.The insurer must try to get closure to customer through 6c concept and by

implementing customer experience management. One of the biggest complaints in the area of

service is inconsistency.Perticularly in public sector like banking and insurance.The views of

the customers vary significantly because one customers experience differs generally from the

next.Inconsistency may be a result of different service experiences from the same staff

complement.It could also be inconsistency among staff where service by the field officers does

not match with the service received when one gets to the insurers office.

1.3 RATIONALE

The Contribution of service Industry in India Economy is 57.2% .And contribution of Insurance

sector is 3%.In service Industry customer satisfaction plays very importance role to retain the

customers.Customer satisfaction is a term frequently used in marketing ,It is a measure of how

products and services supplied by a company meet or surpass customer expectation. Customer

satisfaction provides a leading indicator of consumer purchase intentions and loyalty.

This study will have significant contribution to improve customer satisfaction level of LifeInsurance policy holder of LIC and Bajaj Allianz and also identify the critical area of customer

satisfaction in Insurance sector and provide suggestion for improvement.

8/4/2019 FINAL MRP AZISH 28-09-2011

10/61

1.4 OBJECTIVE

1. Comparative study of customer satisfaction level of policy holders of Lic and Bajaj

Allianz.

8/4/2019 FINAL MRP AZISH 28-09-2011

11/61

1.5.PROFILE

Brief History Of Insurance

The story of insurance is probably as old as the story of mankind. The same instinct that promptsmodern businessmen today to secure themselves against loss and disaster existed in primitivemen also. They too sought to avert the evil consequences of fire and flood and loss of life andwere willing to make some sort of sacrifice in order to achieve security. Though the concept ofinsurance is largely a development of the recent past, particularly after the industrial era pastfew centuries yet its beginnings date back almost 6000 years.

Life Insurance in its modern form came to India from England in the year 1818. Oriental LifeInsurance Company started by Europeans in Calcutta was the first life insurance company onIndian Soil. All the insurance companies established during that period were brought up with thepurpose of looking after the needs of European community and Indian natives were not beinginsured by these companies. However, later with the efforts of eminent people like BabuMuttylal Seal, the foreign life insurance companies started insuring Indian lives. But Indian liveswere being treated as sub-standard lives and heavy extra premiums were being charged on them.Bombay Mutual Life Assurance Society heralded the birth of first Indian life insurance companyin the year 1870, and covered Indian lives at normal rates. Starting as Indian enterprise withhighly patriotic motives, insurance companies came into existence to carry the message ofinsurance and social security through insurance to various sectors of society. Bharat InsuranceCompany (1896) was also one of such companies inspired by nationalism. The Swadeshimovement of 1905-1907 gave rise to more insurance companies. The United India in Madras,National Indian and National Insurance in Calcutta and the Co-operative Assurance at Lahorewere established in 1906. In 1907, Hindustan Co-operative Insurance Company took its birth inone of the rooms of the Jorasanko, house of the great poet Rabindranath Tagore, in Calcutta. TheIndian Mercantile, General Assurance and Swadeshi Life (later Bombay Life) were some of thecompanies established during the same period. Prior to 1912 India had no legislation to regulate

8/4/2019 FINAL MRP AZISH 28-09-2011

12/61

insurance business. In the year 1912, the Life Insurance Companies Act, and the Provident FundAct were passed. The Life Insurance Companies Act, 1912 made it necessary that the premiumrate tables and periodical valuations of companies should be certified by an actuary. But the Actdiscriminated between foreign and Indian companies on many accounts, putting the Indiancompanies at a disadvantage.

The first two decades of the twentieth century saw lot of growth in insurance business. From 44companies with total business-in-force as Rs.22.44 crore, it rose to 176 companies with totalbusiness-in-force as Rs.298 crore in 1938. During the mushrooming of insurance companiesmany financially unsound concerns were also floated which failed miserably. The Insurance Act1938 was the first legislation governing not only life insurance but also non-life insurance toprovide strict state control over insurance business. The demand for nationalization of lifeinsurance industry was made repeatedly in the past but it gathered momentum in 1944 when abill to amend the Life Insurance Act 1938 was introduced in the Legislative Assembly. However,it was much later on the 19th of January, 1956, that life insurance in India was nationalized.About 154 Indian insurance companies, 16 non-Indian companies and 75 provident were

operating in India at the time of nationalization. Nationalization was accomplished in two stages;initially the management of the companies was taken over by means of an Ordinance, and later,the ownership too by means of a comprehensive bill. The Parliament of India passed the LifeInsurance Corporation Act on the 19th of June 1956, and the Life Insurance Corporation of Indiawas created on 1st September, 1956, with the objective of spreading life insurance much morewidely and in particular to the rural areas with a view to reach all insurable persons in thecountry, providing them adequate financial cover at a reasonable cost.

The (non-life) insurance business, however, continued to thrive with the private sector till 1972.Their operations were restricted to organized trade and industry in large cities. The generalinsurance industry was nationalized in 1972. With this, nearly 107 insurers were amalgamated

and grouped into four companies- National Insurance Company Ltd., The New India AssuranceCompany Ltd., The Oriental Insurance Company Ltd. and United India Insurance Company Ltd.These were subsidiaries of the General Insurance Corporation of India (GIC).

TYPES OF INSURANCE

GENERAL INSURANCE:

The basis for general insurance is "transfer of risk".

This means that the insurer agrees to compensate you if you suffer a loss. Without the insuranceyou would have to pay for that loss yourself. Obviously this contract is made on the basis that theinsurance company calculates the risk that you, or the total number of people buying insurance,will cost more in payouts than what is received in premiums. This is determined by the use ofstatistics and the information you disclose on your application for insurance.This includes:

8/4/2019 FINAL MRP AZISH 28-09-2011

13/61

8/4/2019 FINAL MRP AZISH 28-09-2011

14/61

LEVEL TERM LIFE INSURANCE:

Level term life insurance provides an equal amount of protection for a period of time. Forexample, an Rs 150,000 ten-year level term life insurance policy pays out Rs 150,000 ofcoverage until the ten years are over. At the end of the ten years this level term life insurance

policy would expire, and would pay out no benefits.

DECREASING TERM LIFE INSURANCE:

Decreasing term life insurance is a policy where the benefit amount decreases gradually over theterm of the protection. A 30 year Rs 200,000 decreasing term policy, for example, wound paysan Rs 200,000 benefit at the beginning of the policy. This amount would gradually decline overthe 30-year term and would pay out Rs 0 at the end of the term.

INCREASING TERM LIFE INSURANCE:

Increasing term life insurance policies provide a payout benefit that gradually increases atperiodic intervals. These increase amounts are usually a percentage of the original amount..When changing the policy, your premium term life insurance rates are based on either yourcurrent age, or the age when you originally took out the policy. Depending on how your policy isset up, you could be paying much lower interest rates that you would have normally qualifiedfor.

WHOLE LIFE INSURANCE:

Whole life insurance is a popular life insurance plan because it provides permanent protection,

provided premiums are paid. The advantages of whole life insurance plans are cash values,maturity at age 100, and living benefits. Also the policy's premiums and benefits remain constantthroughout the policy's life. Unlike term life insurance, which provides only death protection,whole life insurance combines insurance protection with savings benefit. The cash value of thistype of insurance builds over the life of the policy. This is because whole life insurance plans aregiven a certain guaranteed interest rate. Another benefit of whole life insurance policies is thatthey are designed to mature at the age of 100. The premium rate for a whole life insurance isbased on the assumption that the insured would be paying premiums until the age of 100. Thismeans that at age 100, the cash value of the policy has come to the point when it equals the faceamount of the policy. At this point the policy has completely matured, no more premiums areowned, and the policy is completely paid out to the policy owner.

UNIVERSAL LIFE INSURANCE:

Universal life insurance is a variation of whole and term life insurance, with added flexibility andtransparency. This added flexibility allows the policy owner to determine the amount andfrequency of premium payments and to adjust the benefit payout amount up or down to reflect

http://www.mylifeinsurance.org/term-life-insurance/term-life-insurance-rates.htmlhttp://www.mylifeinsurance.org/http://www.mylifeinsurance.org/term-life-insurance/term-life-insurance-rates.htmlhttp://www.mylifeinsurance.org/

8/4/2019 FINAL MRP AZISH 28-09-2011

15/61

changes in needs... Universal life insurance policies remain in force as long as there enough cashvalue to pay the monthly mortality expenses, regardless of whether or not the policyowner paysthe premium.

OVERVIEW OF THE LIFE INSURANCE SECTOR IN INDIA

With largest number of life insurance policies in force in the world, Insurance happens to be amega opportunity in India. Its a business growing at the rate of 15-20 per cent annually andpresently is of the order of Rs 450 billion. Together with banking services, it adds about 7 percent to the countrys GDP. Gross premium collection is nearly 2 per cent of GDP and fundsavailable with LIC for investments are 8 per cent of GDP.Yet, nearly 80 per cent of Indianpopulation is without life insurance cover, health insurance and non-life insurance continue to bebelow international standards. And this part of the population is also subject to weak socialsecurity and pension systems with hardly any old age income security. This is an indicator thatgrowth potential for the insurance sector is immense. A well-developed and evolved insurance

sector is needed for economic development as it provides long term funds for infrastructuredevelopment and at the same time strengthens the risk taking ability. It is estimated that over thenext ten years India would require investments of the order of one trillion US dollars. TheInsurance sector, to some extent, can enable investments in infrastructure development to sustaineconomic growth of the country. With a large capital outlay and long gestation periods,infrastructure projects are fraught with a multitude of risks throughout the development,construction and operation stages. These include risks associated with project implementation,including geological risks, maintenance, commercial and political risks. Without covering theserisks the financial institutions are not willing to commit funds to the sector, especially becausethe financing of most private projects is on a limited or non- recourse basis. Insurance companiesnot only provide risk cover to infrastructure projects, they also contribute long-term funds. In

fact, insurance companies are an ideal source of long term debt and equity for infrastructureprojects. With long term liability, they get a good asset- liability match by investing their fundsin such projects. IRDA regulations require insurance companies to invest not less than 15 percentof their funds in infrastructure and social sectors. International Insurance companies also investtheir funds in such projects. Insurance is a federal subject in India. There are two legislations thatgovern the sector- The Insurance Act- 1938 and the IRDA Act- 1999. The Government of Indialiberalized the insurance sector in March 2000with the passage of the Insurance Regulatory andDevelopment Authority (IRDA) Bill, lifting all entry restrictions for private players and allowingforeign players to enter the market with some limits on direct foreign ownership. Under thecurrent guidelines, there is a 26 percent equity cap for foreign partners in an insurance company.There is a proposal to increase this limit to 49 percent. Premium rates of most general

Committee. The opening up of the sector is likely to lead to greater spread and deepening ofinsurance in India and this may also include restructuring and revitalizing of the public sectorcompanies. A host of private insurance companies operating in both life and non-life segmentshave started selling their insurance policies since 2001.

http://www.1stinsurancequotes.com/variable-universal-life-insurance.htmhttp://www.1stinsurancequotes.com/variable-universal-life-insurance.htmhttp://www.1stinsurancequotes.com/variable-universal-life-insurance.htm

8/4/2019 FINAL MRP AZISH 28-09-2011

16/61

INDIAN INSURANCE INDUSTRY

Insurance industry, as on 1.4.2000, comprised mainly two players:

Life Insurers:

Life Insurance Corporation of India (LIC)

General Insurers:

General Insurance Corporation of India (GIC) (with effect from Dec'2000, a NationalReinsurer)

GIC had four subsidiary companies, namely (with effect from Dec'2000, these subsidiaries havebeen de-linked from the parent company and made as independent insurance companies.

1. The Oriental Insurance Company Limited2. The New India Assurance Company Limited,3. National Insurance Company Limited4. United India Insurance Company Limited.

Yr: 2000-2001: (From 2nd April '2000 to 31st December'2001)Insurance Industry in the year 2000-2001 had 16 new entrants, namely:

Life Insurers:

S.No. Reg.Number

Date of Reg. Name of the Company

1 101 23.10.2000 HDFC Standard Life Insurance Company Ltd.

2 104 15.11.2000 Max New York Life Insurance Co. Ltd.

3 105 24.11.2000 ICICI Prudential Life Insurance Company Ltd.

8/4/2019 FINAL MRP AZISH 28-09-2011

17/61

4 107 10.01.2001 Kotak Mahindra Old Mutual Life InsuranceLimited

5 109 31.01.2001 Birla Sun Life Insurance Company Ltd.

6 110 12.02.2001 Tata AIG Life Insurance Company Ltd.

7 111 30.03.2001 SBI Life Insurance Company Limited.

8 114 02.08.2001 ING Vysya Life Insurance Company PrivateLimited

9 116 03.08.2001 Bajaj Allianz Life Insurance Company Limited

10 117 06.08.2001 Metlife India Insurance Company Pvt. Ltd.

General Insurers :

S.No. Registration

Number

Date of

Registration

Name of the Company

1 102 23.10.2000 Royal Sundaram AllianceInsurance Company Limited

2 103 23.10.2000 Reliance General InsuranceCompany Limited.

3 106 04.12.2000 IFFCO Tokio General Insurance

Co. Ltd

4 108 22.01.2001 TATA AIG General InsuranceCompany Ltd.

5 113 02.05.2001 Bajaj Allianz General Insurance

8/4/2019 FINAL MRP AZISH 28-09-2011

18/61

8/4/2019 FINAL MRP AZISH 28-09-2011

19/61

3. 125 27.08.2002 HDFC-Chubb General InsuranceCo. Ltd.

Yr: 2003-2004 : (From 1st Jan 2003 till Date)Insurance Industry in this year, so far has 1new entrants; namelyLife Insurers:

S.No. Registration

Number

Name of the Company

1 127 Sahara India Insurance Company Ltd.

Yr: 2004-2005 :Insurance Industry in this year, so far has 1new entrants; namely

Life Insurers:

S.No. Registration

Number

Date of Reg. Name of the Company

1 128 17.11.2005 Shriram Life Insurance Company Ltd.

INSURANCE BUSINEES:

Insurance business is divided into four classes:

8/4/2019 FINAL MRP AZISH 28-09-2011

20/61

1) Life Insurance

2) Fire Insurance

3) Marine Insurance and

4) Miscellaneous Insurance.

Life Insurers transact life insurance business; General Insurers transact the rest.

No composites are permitted as per law.

THE INSURANCE REGULATORY AND DEVELOPMENTAUTHORITY (IRDA)

A faster development and wider impact of the insurance industry were to be achieved through aprocess of insurance reforms resulting in the liberalization of the market and in the passage of theInsurance Regulatory and Development Authority (IRDA) Act, 1999. The reforms proceduresrecognized simultaneously the need for development of the sector in addition to the traditionalconcept of regulation and thus conferred on the Authority the obligation to develop the sector aswell.

OBJECTIVES

To protect the interest of and secure fair treatment to policyholders:

To bring about speedy and orderly growth of the insurance industry, for the benefit ofthe common man, and to provide long terms funds for accelerating growth of theeconomy;

To set, promote, monitor and enforce high standards of integrity, financial soundness,fair dealing and competence of those it regulates:

To ensure that insurance customers receive precise, clear and correct information about

products and services and make them aware of their responsibilities and duties in thisregard;

To ensure speedy settlement of genuine claims, to prevent insurance frauds and othermalpractices and put in place effective grievances redressed machinery;

To promote fairness, transparency and orderly conduct in financial markets dealing withinsurance and build a reliable management information system to enforce high standardsof financial soundness amongst market players.

8/4/2019 FINAL MRP AZISH 28-09-2011

21/61

IRDA POWERES AND FUNCTIONS

Subject to the provisions of IRDA Act (1990), IRDA will: regulate, promote and ensure orderlygrowth of the insurance business and re-insurance business, which will include the followingmain functions (excerpts):

Issue to the applicant a certificate of registration, renew, modify, withdraw, suspend or

cancel such registration;

Protection of the interest of the policy holders in matters concerning assigning off policy,nomination by policy holders, insurable interest, settlement of insurance claim, surrender

value of policy and others terms and conditions of contracts of insurance;

Specifying requisite qualifications, code of conduct and practical training forintermediary or insurance intermediaries and agents.

Promoting and regulation professional organizations connected with the insurance and re-insurance business;

Levying fees and other charges for carrying out the purposes of the Act;

Calling for information from, undertaking inspection of, conducting enquiries andinvestigations including audit of the insurers, intermediaries, insurance intermediariesand other organizations connected with the insurance business;

8/4/2019 FINAL MRP AZISH 28-09-2011

22/61

Specifying the percentage of life insurance and general insurance business to beundertaken by the insurer in the rural or social sector.

IRDA has so far granted registration to 12 private life insurance companies and 9 generalinsurance companies. If the existing public sector insurance companies are included, thereare currently 13 insurance companies in the life side and 13 companies operating in generalinsurance business. General Insurance Corporation has been approved as the "Indian reinsurer" for underwriting only reinsurance business.

PROTECTION OF THE INTEREST OF POLICY HOLDERS

IRDA has the responsibility of protecting the interest of insurance policyholders. Towardsachieving this objective, the Authority has taken the following steps:

IRDA has notified Protection of Policyholders Interest Regulations 2001 to provide for: policyproposal documents in easily understandable language; claims procedure in both life andnon-life; setting up of grievance redress machinery; speedy settlement of claims; andpolicyholders' servicing. The Regulation also provides for payment of interest by insurersfor the delay in settlement of claim.

The insurers are required to maintain solvency margins so that they are in a position to meet theirobligations towards policyholders with regard to payment of claims.

It is obligatory on the part of the insurance companies to disclose clearly the benefits, terms andconditions under the policy. The advertisements issued by the insurers should not misleadthe insuring public.

All insurers are required to set up proper grievance redress machinery in their head office and attheir other offices.

8/4/2019 FINAL MRP AZISH 28-09-2011

23/61

History of Life Insurance Corporation

LIC had 5 zonal offices, 33 divisional offices and 212 branch offices, apart from its corporateoffice in the year 1956. Since life insurance contracts are long term contracts and during thecurrency of the policy it requires a variety of services need was felt in the later years to expandthe operations and place a branch office at each district headquarter. Re-organization of LIC tookplace and large numbers of new branch offices were opened. As a result of re-organisationservicing functions were transferred to the branches, and branches were made accounting units.It worked wonders with the performance of the corporation. It may be seen that from about200.00 crores of New Business in 1957 the corporation crossed 1000.00 crores only in the year1969-70, and it took another 10 years for LIC to cross 2000.00 crore mark of new business. Butwith re-organisation happening in the early eighties, by 1985-86 LIC had already crossed7000.00 crore Sum Assured on new policies.

Today LIC functions with 2048 fully computerized branch offices, 109 divisional offices, 8zonal offices, 992 satallite offices and the Corporate office. LICs Wide Area Network covers109 divisional offices and connects all the branches through a Metro Area Network. LIC has tiedup with some Banks and Service providers to offer on-line premium collection facility inselected cities. LICs ECS and ATM premium payment facility is an addition to customerconvenience. Apart from on-line Kiosks and IVRS, Info Centres have been commissioned atMumbai, Ahmedabad, Bangalore, Chennai, Hyderabad, Kolkata, New Delhi, Pune and manyother cities. With a vision of providing easy access to its policyholders, LIC has launched itsSATELLITE SAMPARK offices. The satellite offices are smaller, leaner and closer to thecustomer. The digitalized records of the satellite offices will facilitate anywhere servicing and

many other conveniences in the future.

LIC continues to be the dominant life insurer even in the liberalized scenario of Indian insuranceand is moving fast on a new growth trajectory surpassing its own past records. LIC has issuedover one crore policies during the current year. It has crossed the milestone of issuing1,01,32,955 new policies by 15th Oct, 2005, posting a healthy growth rate of 16.67% over thecorresponding period of the previous year.

8/4/2019 FINAL MRP AZISH 28-09-2011

24/61

From then to now, LIC has crossed many milestones and has set unprecedented performancerecords in various aspects of life insurance business. The same motives which inspired ourforefathers to bring insurance into existence in this country inspire us at LIC to take this messageof protection to light the lamps of security in as many homes as possible and to help the peoplein providing security to their families.

Some of the important milestones in the life insurance business in India are:

1818: Oriental Life Insurance Company, the first life insurance company on Indian soil startedfunctioning.

1870: Bombay Mutual Life Assurance Society, the first Indian life insurance company started itsbusiness.

1912: The Indian Life Assurance Companies Act enacted as the first statute to regulate the lifeinsurance business.

1928: The Indian Insurance Companies Act enacted to enable the government to collect

statistical information about both life and non-life insurance businesses.

1938: Earlier legislation consolidated and amended to by the Insurance Act with the objective ofprotecting the interests of the insuring public.

1956: 245 Indian and foreign insurers and provident societies are taken over by the centralgovernment and nationalised. LIC formed by an Act of Parliament, viz. LIC Act, 1956, with acapital 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 TritonInsurance 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 ofgeneral insurance business.

8/4/2019 FINAL MRP AZISH 28-09-2011

25/61

1957: General Insurance Council, a wing of the Insurance Association of India, frames a code ofconduct for ensuring fair conduct and sound business practices.

1968: The Insurance Act amended to regulate investments and set minimum solvency marginsand the Tariff Advisory Committee set up.

1972: The General Insurance Business (Nationalisation) Act, 1972 nationalised thegeneral insurance business in India with effect from 1st January 1973.

VISION &MISSION

Mission"Explore and enhance the quality of life of people through financial security by providingproducts and services of aspired attributes with competitive returns, and by rendering resourcesfor economic development."

Vision"A trans-nationally competitive financial conglomerate of significance to societies and Pride ofIndia."

8/4/2019 FINAL MRP AZISH 28-09-2011

26/61

BAJAJ ALLIANZ HISTORY

Bajaj Allianz General Insurance Company Limited or Bajaj Allianz Insurance is a joint venturebetween two of the most reputed names in the world of insurance - Bajaj Finserv Limited andAllianz SE. Both of the names are known for their strength, expertise and stability in theinsurance sector. While Bajaj Finserv Limited holds the 74% of the paid up capital of` 110crore, Allianz SE holds the remaining 26%. It can be added here that Bajaj Finserv Limited hasvery recently demerged from Bajaj Auto Limited.Bajaj Allianz Insurance started its journey on May 2, 2001 when it received the certificate ofRegistration from Insurance Regulatory and Development Authority (IRDA) for conductingGeneral Insurance business in India including Health Insurance. As on the end of March 2009,the income of Bajaj Allianz Insurance went up to `2,866 crore with a growth of 11% over theprevious year. It also registered a net profit of` 95 crore, highest by any private insurer, in the

last financial year.

Bajaj Allianz General Insurance Company Ltd. offers a range of insurance products to its clients.

The following insurances are offered by the company:

Motor Insurance

Asset Insurance

Health Insurance

Travel Insurance

Corporate Insurance

o Your Employees

o Office

o Manufacturing Unit

o Credit Insurance

8/4/2019 FINAL MRP AZISH 28-09-2011

27/61

Bajaj Allianz Life Insurance Co. Ltd. is a joint venture between two leading conglomerates- ,Bajaj Auto, one of the biggest 2 and 3 wheeler manufacturers in the world and Allianz AG, oneof the world's largest insurance companies.

Bajaj Allianz Life Insurance

Is the fastest growing private life insurance company in India. Currently has over 3,00,000 satisfied customers We have customer care centers in 155 cities with 28000 Insurancce Consultant

providingthe finest customer service One of India's leading private life insurancecompanies .

BajajAllianzGeneralInsuranceCompanyLimited

Bajaj Allianz General Insurance Company Limited is a joint venture between Bajaj Auto Limited

and Allianz AG of Germany. Both enjoy a reputation of expertise, stability and strength.

Bajaj Allianz General Insurance received the Insurance Regulatory and Development Authority(IRDA) certificate of Registration (R3) on May 2nd, 2001 to conduct General Insurance business(including Health Insurance business) in India. The Company has an authorized and paid upcapital of Rs 110 crores. Bajaj Auto holds 74% and the remaining 26% is held by Allianz, AG,Germany.

In its first year of operations, the company has acquired the No. 1 status among the private non-life insurers. As on 31st March 2003, Bajaj Allianz General Insurance maintained its leadershipposition by garnering a premium income of Rs.300 Crores. Bajaj Allianz also became one of the

few companies to make a profit in its first full year of operations. Bajaj Allianz made a profitafter tax of Rs.9.6 crores.

Bajaj Allianz today has a network of 42 offices spread across the length and breadth of thecountry. From Surat to Siliguri and Jammu to Thiruvananthapuram, all the offices areinterconnected with the Head Office at Pune.

In the first half of the current financial year, 2004-05, Bajaj Allianz garnered a premium incomeof Rs. 405 crores, achieving a growth of 84% and registered a 52% growth in Net profits ofRs.20 Crores over the last year for the same period. In the financial year 2003-04, the premiumearned was Rs.480 Crores, which is a jump of 60% and the profit zoomed by 125% to Rs. 21.6

Crores.

Vision

8/4/2019 FINAL MRP AZISH 28-09-2011

28/61

To be the first choice insurer for customers To be the preferred employer for staff in the insurance industry. To be the number one insurer for creating shareholder value.

Mission

As a responsible, customer focused market leader, we will strive to understand the insuranceneeds of the consumers and translate it into affordable products that deliver value for money.

LIC PROFILE

The Life Insurance Corporation (LIC) was established about 44 years ago with a view to providean insurance cover against various risks in life. A monolith then, the corporation, enjoyed amonopoly status and became synonymous with life insurance.

Its main asset is its staff strength of 1.24 lakh employees and 2,048 branches and over six lakhagency force.

LIC has hundred divisional offices and has established extensive training facilities at all levels.At the apex, is the Management Development Institute, seven Zonal Training Centres and 35Sales Training Centres.

At the industry level, along with the Government and the GIC, it has helped establish theNational Insurance Academy. It presently transacts individual life insurance businesses, groupinsurance businesses, social security schemes and pensions, grants housing loans through itssubsidiary; and markets savings and investment products through its mutual fund. It pays offabout Rs 6,000 crore annually to 5.6 million policyholders.

OBJECTIVES OF LIC

Spread Life Insurance widely and in particular to the rural areas and to the socially and

economically backward classes with a view to reaching all insurable persons in the

country and providing them adequate financial cover against death at a reasonable cost.

Maximize mobilization of people savings by making insurance-linked savings

adequately attractive.

8/4/2019 FINAL MRP AZISH 28-09-2011

29/61

Bear in mind, in the investment of funds, the primary obligation to its policyholders,

whose money it holds in trust, without losing sight of the interest of the community as a

whole; the funds to be deployed to the best advantage of the investors as well as the

community as a whole, keeping in view national priorities and obligations of attractive

return.

Conduct business with utmost economy and with the full realization that moneys belong

to the policyholders.

Act as trustees of the insured public in their individual and collective capacities.

Meet the various life insurance needs of the community that would arise in the changing

social and economic environment.

RESTRICTIVE CONDITIONS

Minimum age at entry :18 years (completed)

Maximum age at entry :60 years (nearest birthday)

Maximum age at maturity :70 years (nearest birthday)

Minimum Policy Term :5 years

Maximum Policy term :35 years

Minimum Sum Assured :Rs.25,00,000/-

Maximum Sum Assured : No Upper Limit

(Policies will be issued in multiples of Rs.100,000/- for Sums Assured

more than the minimum Sum Assured)

Mode of premium payment : Yearly, Half-yearly & Single Premium

8/4/2019 FINAL MRP AZISH 28-09-2011

30/61

Market Share

NAME OF THE PLAYER MARKET SHARE (%)

MARKET SHARE ANALYSIS Percentage

Life Insurance Corporation of India 67%

ICICI Prudential Life Insurance Co Ltd 9.00%

Bajaj Allianz Life Insurance Co Ltd 6.36%

SBI Life Insurance Co Ltd 4.50%

Reliance Life Insurance Co Ltd 2.50%

HDFC Standard Life Insurance Co Ltd 2.88%

Birla Sun Life Insurance Co Ltd 2.00%

Max New York Life Insurance Co Ltd 1.55%

Kotak Mahindra Old Mutual Life Insurance Ltd 1.00%

Aviva Life Insurance Company India Ltd 1.20%

Others 2.01%

8/4/2019 FINAL MRP AZISH 28-09-2011

31/61

BAJAJ ALLIAN PROFILE

Bajaj Allianz Life Insurance Co. Ltd. is a joint venture between two leading conglomerates -

Allianz AG, one of the world's largest insurance companies, and Bajaj Auto, one of the biggest 2

and 3 wheeler manufacturers in the world. Bajaj Allianz Life Insurance has a shareholder base of

over Rs 700 crores with an asset management value of Rs 5,500 crores and over 850 offices and

4 million satisfied customers

Allianz SE is a leading insurance conglomerate globally and one of the largest asset managers inthe world, managing assets worth over a Trillion Euros (Over R. 55,00,000 crores). Allianz SE

has over 115 years of financial experience in over 70 countries.

Bajaj Auto is one of the most trusted name is Indian auto for over 55 years. At Bajaj Allianz

customer delight is our guiding principle. Ensuring world-class solutions by offering customized

products with transparent benefits, supported by best technology is our business philosophy.

67%

9.00%

6.36%

4.50%

2.50% 2.88%

2.00% 1.55%

1.00%

1.20%

2.01%

MARKET SHARE ANALYSIS

Life Insurance Corporation of

IndiaICICI Prudential Life Insurance Co

Ltd

Bajaj Allianz Life Insurance Co Ltd

SBI Life Insurance Co Ltd

Reliance Life Insurance Co Ltd

HDFC Standard Life Insurance Co

Ltd

Birla Sun Life Insurance Co Ltd

Max New York Life Insurance CoLtd

Kotak Mahindra Old Mutual Life

Insurance Ltd

Aviva Life Insurance Company

India Ltd

8/4/2019 FINAL MRP AZISH 28-09-2011

32/61

Bajaj Allianz General Insurance Co. Ltd. is a joint venture between BajajAuto and Allianz

AG of Germany. Both enjoy a reputation of expertise, stability and strength.

Bajaj Allianz General Insurance received the Insurance Regulatory and Development Authority

(IRDA) certificate of Registration (R3) on May 2, 2001 to conduct General Insurance business

(including Health Insurance business) in India. The Company is authorized and has paid up

capital of Rs 110 crores. Bajaj Auto holds 74% and the remaining 26% is held by Allianz AG,

Germany.

In its first year of operations, the company has acquired No. 1 status among the private non-life

insurers. As on March 31, 2003.Bajaj Allianz General Insurance maintained its leadership

position by garnering a premium income of Rs.300 Crores. Bajaj Allianz also became one of the

few companies to make a profit in its first full year of operations. Bajaj Allianz made a profit

after tax of Rs.9.6 crores.

Bajaj Allianz today has a network in more than 485 cities spread across the length and breadth of

the country. From Surat to Siliguri and Jammu to Thiruvananthapuram, all the offices are

interconnected with the Head Office at Pune.

In the first half of the financial year, 2004-05, Bajaj Allianz garnered a premium income of Rs.

405 crores, achieving a growth of 84% and registered a 52% growth in net profits of Rs.20

Crores over the last year for the same period. In the financial year 2003-04, the premium earned

was Rs.480 Crores, and the profit zoomed by 125% to Rs. 21.6 Crores

ALLIANZ GROUP

8/4/2019 FINAL MRP AZISH 28-09-2011

33/61

Allianz Group is one of the world's leading insurers and financial services providers. Founded in

1890 in Berlin, Allianz is now present in over 70 countries with almost 174,000 employees. At

the top of the international group is the holding company, Allianz AG, with its head office in

Munich.

Allianz Group provides its more than 60 million customers worldwide with a comprehensive

range of services in the areas of:

Property and Casualty Insurance,

Life and Health Insurance,

Asset Management and Banking.

Easy access and reach across the country

Bajaj Allianz Life has offices now in over 485 towns across the country enabling customer to

buy our products and get quality efficient service almost anywhere across the country.

ALLIANZ AG- A GLOBAL FINANCIAL POWERHOUSE

Worldwide 2nd by Gross Written Premiums - Rs.4, 46,654 cr.

3rd largest Assets Under Management (AUM) & largest amongst. Insurance cos.

- AUM of Rs.51, 96,959 cr.

12th largest corporation in the world.

49.8 % of global business from Life Insurance.

Established in 1890, 110 yrs of Insurance expertise.

8/4/2019 FINAL MRP AZISH 28-09-2011

34/61

70 countries; 173,750 employees worldwide.

BAJAJ AUTO

Bajaj Auto Ltd, the flagship company of the Rs. 8000 crore Bajaj group is the largest

manufacturer of two-wheelers and three-wheelers in India and one of the largest in the world.

A household name in India, Bajaj Auto has a strong brand image & brand loyalty synonymous

with quality & customer focus.

AN STRONG INDIAN BRAND- HAMARA BAJAJ

One of the largest 2 & 3 wheeler manufacturers in the world.

21 million+ vehicles on the roads across the globe.

Managing funds of over Rs 4000 cr.

Bajaj Auto finance one of the largest auto finance companies in India.

Rs. 4,744 cr. turnover & profits of 538 cr. in 2002-03.

It has joined hands with Allianz to provide Indian consumers with a distinct option in

terms of life insurance products.

8/4/2019 FINAL MRP AZISH 28-09-2011

35/61

As a promoter of Bajaj Allianz Life Insurance Co. Ltd., Bajaj Auto has the following to

offer

Financial strength and stability to support the Insurance Business.

A strong brand-equity.

A good market reputation as a world class organization.

An extensive distribution network.

Adequate experience of running a large organization.

Bajaj Allianz Life Insurance Company has developed insurance solutions that cater to every

segment and age-income profiles. For companies it provides comprehensive 'Employee Benefit

Solutions' (Group Term Life, EDLI, Gratuity, Superannuation, Key man Insurance and more);

for the individual Invest Gain (a unique life insurance plan where sustenance of income is

combined in the same plan that also pays a lump sum), Cash Gain (Money Back), Child Gain

(Children's plan), Risk Care (Pure Term), Lifetime Care (whole life), Term Care (term with

return of premium), Swarna Vishranti (Retirement Plan), Protector (Mortgage term insurance

plan), Unit Gain (Unit Linked Plan), Unit Gain Single Premium, Unit Gain Plus, Unit Gain Plus

SP, Lifelong Gain Plan, Unit Gain Single Pension & Unit Gain Easy Pension Plans.

SUPERIOR TECHNOLOGY

In order to ensure speedy and accurate processing of your needs, it has established world class

technology, with renowned insurance software, which networks all its offices and intermediaries-

8/4/2019 FINAL MRP AZISH 28-09-2011

36/61

Using the Web, policies can be issued from any office across the country for retail products.

Unique, user friendly software is developed to make the process of issue of policies and

claims settlement simpler (e.g. online insurance of marine policy certificate).

UNIQUE FORMS OF RISK COVER

Special PA cover for Amaranth pilgrims.

Film insurance.

Event management cover.

Sports & Entertainment Insurance Package.

RISK AND MANAGEMENT

Its methodology is tried, tested and proven the world over and involves:

Risk identification: Inspections.

Risk analysis: Portfolio review and gap analysis.

Risk retention.

Risk Transfer: To an insurer as well as re insurer (as required).

Creation of need based products.

Ongoing dialogue and proclivity.

8/4/2019 FINAL MRP AZISH 28-09-2011

37/61

Definitions and theoretical concept framework

Customer loyalty has been examined by many researchers in the past and many of them have

given various definitions around this concept. According to Heskett (2002), customer loyalty hasbeen regarded as the sina qua nonof an effective business strategy. Dick and Basu (1994, p.99)give a stronger conceptualization for customer loyalty. They view it as the strength of therelationship between an individuals relative attitude towards an entity (brand, Products, store, orvendor) and repeat patronage.

Customer satisfaction

What is customer satisfaction?

Customer satisfaction is a term frequently used in marketing,It is a measure of how products and

services supplied by a company meet or surpass customer expectation. Customer satisfaction isdefined as "the number of customers, or percentage of total customers, whose reported

experience with a firm, its products, or its services (ratings) exceeds specified satisfaction

goals.Customer satisfaction provides a leading indicator of consumer purchase intentions and

loyalty.

Social psychologists, marketing researchers, and students of consumer behaviour, haveextensively studied the concepts of customer satisfaction and dissatisfaction. The increasingimportance of quality in both Products and manufacturing industries has also created a proliferation of research, with more than 15,000 academic and trade articles having been

published on the topic of customer satisfaction in the past two decades (Peterson and Wilson,1992). Several conferences have been devoted to the subject and extensive literature reviewshave been published (Day, 1977; Hunt, 1977; LaTour and Peat, 1979; Smart, 1982; Ross, et al.,1987, Barsky, 1992: Oh and Parks, 1997) The result of all this research has been thedevelopment of nine distinct theories of customer satisfaction. The majority of these theories arebased on cognitive psychology, some have received moderate attention, while other theorieshave been introduced without any empirical research.

The nine theories include:

expectancy disconfirmation;

assimilation or cognitive dissonance;

contrast;

assimilation-contrast;

equity;

http://en.wikipedia.org/wiki/Marketinghttp://en.wikipedia.org/wiki/Marketing

8/4/2019 FINAL MRP AZISH 28-09-2011

38/61

attribution;

comparison-level;

generalized negativity; and

value-precept (Oh and Parks, 1997).

Recently, numerous researchers have attempted to apply CS theories developed by consumerbehaviourists in the areas of lodging (Barsky, 1992; Barsky and Labagh, 1992; Saleh and Ryan,1991; Ekinci and Riley, 1998), restaurant (Dube et al., 1994; Bojanic and Rosen, 1994; Lee andHing, 1995; Oh and Jeong, 1996), foodProducts (Almanza et al., 1994), and tourism (Pizam andMilman, 1993; Danaher and Arweiler, 1996; Ryan and Cliff, 1997; Hudson and Shepard, 1998)in order to investigate CS applicability to the hospitality and tourism industries.

For several decades the word or concept customer satisfaction was of crucial importance for

marketing, managers and the organizations and it is regarded today central issue to manydefinitions (Parker and Mathews, 2001). The Oxford Library of Words and Phrases (1993)emphasize satisfaction as a release from uncertainty. Customer satisfaction can be defined inmany ways. Kotler (2000, pg.36) defines customer satisfaction as one of which is a person'sfeelings of pleasure or disappointment from comparing a product's perceived performance (oroutcome) in relation to his or her expectations. Another conceptualization given from Homburget al. (2005) is that customer satisfaction is a cumulative, worldwide assessment based ondifferent experiences with a firm. Similarly, Kotler (1991) and Fornell (1992) characterizedsatisfaction as an evaluation of quality of products after customers purchase them and he arguesthat high customer satisfaction ratings are widely believed to be the best indicator of acompanys future profits (Kotler 1991, pg.19).

Customer perception of value

Theoretical concept framework and definitions

The creation of consumer value has been taken into consideration from many managers duringthe 1990s and it was the result of companies need to be more competitive and to fulfill theincreasing customer demands (Cravens and Piercy, 2003). Consumer perceived value depends onhow the customer perceives the benefits of an offering and the sacrifice that is associated withits purchase (Jobber, 2004, pg.13). Thats why, Monroe (1991) and Sweeney (1994) definecustomer perceived value as the ratio between perceived benefits and perceived sacrifice. Also,

Monroe and Chapman (1987) suggest that perceived value is a weighted sum of acquisition andtransaction value.

Customer perceived value can be broadly defined as the customers overall assessment of theutility of a product based on perceptions of what is received and what is given (Zeithaml, 1988,p. 14).

Importance of customer perception of value

8/4/2019 FINAL MRP AZISH 28-09-2011

39/61

Many discounters, retail stores and supermarkets now focus to the offering of value-addedProductss and highlight the importance of them to become more competitive (Kim and Jin,2002). Examining the effects and impact of consumers perception of value, generally value isvery important and crucial to marketers for the success of companies (Dodds, 1991; Fredericksand Salter, 1995).

The relationship between customer perception of value and customer satisfaction

McDougall and Levesque (2000, p. 394) argued that customers who perceive they received

value for money are more satisfied than customers who do not perceive they received value for

money.

SERVQUAL HISTORY

SERVQUAL model

SERVQUAL model theory is the late 20th century, 80 scientists from the American Marketing

Parra off Raman (A. Parasuraman), to special Han Maule (Zeithaml) and white Switzerland

(Berry) based on total quality management (Total Quality Management, TQM) theory proposed

in the service sector, a new service quality evaluation system, the core of his theory of the level

of service perceived by users and users expect the difference between the level of service level

(so-called to exceed the user's expectations. The model is: Servqual score = actual feelings Score

- Expectation Score.

SERVQUAL service quality will be divided into five levels: physical infrastructure (Tangibles),reliability (Reliability), responsiveness (Responsiveness) to protect nature (Assurance), affective

involvement (Empathy), each level has been broken down into a number of issues, through the

questionnaire, which allows the user expectations for each question, the actual value and the

minimum acceptable value of the experience to rate . by the establishment of the 22 specific

factors related to that it. and then through the questionnaire, scoring and overall customer service

quality scores calculated, the past decade, the model has been widely accepted by managers and

academics and adoption. model to differences based on the theory that the customer expectations

of service quality and customer service organizations from the actual differences between the

services received. models were evaluated with five scale acceptable to the different customer

service quality of service. Research that, SERVQUAL for measuring information systemsservice quality, SERVQUAL is an evaluation of service quality and improve the quality of

service action to determine an effective tool.

SERVQUAL formula: SQ = 622i = 1 (Pi - Ei) where:

SQ as perceived service quality;

Pi for the i-factor in terms of customer perception scores;

Ei for the i-factor in customer expectations scores (i = 1, 2, 3 ,..... n, n = 22).

8/4/2019 FINAL MRP AZISH 28-09-2011

40/61

SQ obtained from the above equation is equally important in the five attributes of individual

customers under the conditions of the total perceived quality, but in real life, the customer

decided to quality of service about the importance of each attribute is different. Therefore,

through customer surveys, should determine the service quality attributes for each weight, then

the weighted average to draw a more reasonable Servqual score. < br> formula: SQ = 65j = 1wj

622i = 1 (Pi - Ei) (i = 1, 2, 3 22, j = 1, 2, 3, 4, 5) wj for the first j attributes weight. < br> At this

point the SQ will be divided by the factor scores of the number of n (n = 22), to get a single

customer Servqual average score. Finally, the survey scores for all customers Servqual sum,

divided by the number of customers m, to obtain the services of an enterprise product Servqual

average score, which Servqual = 6mi = 1SQiPm

SERVQUAL model to measure the five scale

SERVQUAL model of service quality in five scales; tangible assets, reliability, response speed,

trust and empathy. tangible physical facilities, equipment, personnel and communication

materials, appearance; such as: equipment availability, staff spirit, as well as other tools used to

provide services and equipment in good condition. reliability of the reliable, accurate and abilityto fulfill service commitments; such as: provide services in a timely manner and the fulfillment

of its commitments. responsiveness and rapid delivery of services to help customers desire;

assurance staff has the knowledge, etiquette and confidence and credible expression of the

ability; of put ourselves in empathy for the sake of customers and pay particular attention to

customer. SERVQUAL model the evolution of PZB (1985) for the service quality factors

(determinants of service quality) made of ten, the quality of customer service experience for the

main components.

1. Reliability (reliability): consistency of performance, performance, and the importance ofcommitment to consumers.

2. reactivity (responsiveness): Staff will provide services and immediate.

3. Competence (competence): whether staff has the expertise and skills in the implementation of

services.

4. proximity (access): proximity, contact or contact means easy.

5. politeness (courtesy): customer service or telephone answering service, we must be attentive

and courteous, respectful, considerate and friendly. < br> 6. communicating (communication):

the consumer can and honest feelings.

8. security (security): from consumers worried about danger, risk of confusion as the status of

style.9. understanding of (understanding / knowing the customer): the understanding of customer

needs.

10. Tangibles (tangibles): services, physical evidence and other service facilities.

SERVQUAL model using

SERVQUAL model widely used in the service industry, to understand the target customer's

service needs and perceptions and to provide a set of management methods and measuring

8/4/2019 FINAL MRP AZISH 28-09-2011

41/61

service quality. within the enterprise, with the SERVQUAL model to understand the perception

of quality of service staff to achieve the objective of improving services.

medical services based on SERVQUAL Quality Evaluation Model

mm HA hospital pp of Chinese Abstract: Master: Wang Li Niu Instructor: Professor Zhang

Liang Views: 1783 quality of medical services, the medical service market in the first element

not only directly related to patient safety and outcomes, and hospital survival is the primary

condition. To continue to improve hospital quality of service, quality of service evaluation and

management of medical services have become the core and focus. In the quality level. and

satisfaction rating than you can learn more information about the perceptions and expectations,

and evaluation results are more objective and real. But SERVQUAL construct our own quality

evaluation system for health care research is still rare. Therefore, situation of our country and the

special nature of the medical industry, the establishment of the medical service quality

SERVQUAL-based evaluation model, evaluation, forecasting demand for medical services in

patients, examine the existing medical service quality, and has some innovative and practical

significance. purpose is to study this subject of medical service quality based on SERVQUALevaluation model for the initial establishment of China's medical industry, scientific and

reasonable, based on the SERVQUAL evaluation of medical service quality evaluation model,

including the system of rating scales for indicator components Interpretation methods and scale

so as to understand the medical needs of patients, for their own health care quality evaluation, to

provide a tool to improve the quality of service. In addition, by understanding the basic situation

of patients with health care quality evaluation of the impact of a deeper understanding of The

evaluation model.

Method

1. access to a large number of domestic and foreign literature research on the SERVQUAL scale

model of medical service quality theory and methods, interpretation of the relevant literature.2. in-depth interviews in this study medical service quality evaluation model, index selection, the

survey content and other aspects of repeated interviews and rigorous argument, in Medical

Management and Union Hospital, the participation of relevant experts to complete.

3. using standardized questionnaires standardized questionnaire, including patient medical

service quality expectations and actual feelings of the questionnaire survey.

4. statistical analysis questionnaire data entry using Microsoft Office Excel2003 by SPSS11.5

handle all the data. According to information on the nature of the use of T test, ANOVA, factor

analysis, processing of bio-statistical methods.

Results

1. SERVQUAL based on its evaluation of medical service quality theory

Grow by Ruth customer perception of service quality theory, PZB's gap theory and the

SERVQUAL service quality evaluation methods, and more that the quality of security than the

first three links (the structure m m process results) and the limitations of the scientific theory of

analysis, combined with our national conditions, the initial establishment of the SERVQUAL-

based health care quality evaluation model of the theoretical framework. the main consideration

of the framework and the actual perception of the expectations of patients for medical services,

8/4/2019 FINAL MRP AZISH 28-09-2011

42/61

technical quality and functional quality of both proposed tangibles, reliability, trust,

responsiveness, human services, effective and economic evaluation in seven dimensions.

2. SERVQUAL-based health care services Quality Evaluation Model

(1) In this paper, literature, in-depth interviews and pre-survey evaluation index system of pre-

correction, ultimately formed, including tangibles, reliability, trust, responsiveness, human

services, effectiveness and economy of seven dimensions, a total of 28 secondary indicators of

the evaluation index system.

(2) letter of evaluation model and validity analysis: Reliability analysis of mainly Crown Bach

(Cronbach) a method and split-half reliability coefficient method, four hospitals in total a factor

0.9351,0.9555,0.9473 and 0.9428, respectively, split-half reliability were a total of 0.8626 ,

0.9090,0.8632,0.9128, with very high reliability. validity analysis using factor analysis, four

hospital information Kaiser-Meyer-Olkin (KMO value that is) results show that suitable for

factor analysis and factor analysis results suggest that the extracted seven factors and indicators

consistent system of seven dimensions, with good validity.

(3) interpretation of evaluation results Methods: In this paper, margin calculations, T test andanalysis of quadrant analysis .

3. single factor statistical analysis

T test analysis can not believe that gender, place of residence and are residing in health care

quality evaluation of patients had significant differences. variance analysis showed that age can

not be segment, educational level, occupation, income level and health insurance in the form of

patient care quality evaluation of significant differences.

Conclusion

(1) Quality of medical services should be considered in the expectations of its influencing factors

in patients role;

(2) established based on the SERVQUAL model of quality evaluation of medical services,including medical services based on SERVQUAL quality evaluation index system and scale of

interpretation methods;

(3) health care system based on SERVQUAL service quality evaluation index system has high

reliability and validity;

(4) the medical service quality SERVQUAL-based evaluation model can initially be used for

different levels of quality and size of the hospital assessment;

(5) use The evaluation model, the basic situation of the differences between patients with the

medical service quality evaluation is basically not affected.

SERVQUAL service quality evaluation model and its modification of the

text / Lin Hang Li Mengjun

1. Introduction

In the same quality of products, basically the same core product prices, the service is the only

correct way beyond the competition aware of services in modern society the importance of the

economy. However, how to evaluate the level of service quality research scholars have been the

problem, a widely used model is SERVQUAL evaluation. It is also a controversial evaluation

because of its theoretical basis and design of the survey methodology itself has led to its limits.

8/4/2019 FINAL MRP AZISH 28-09-2011

43/61

When the time specific to different industries, SERVQUAL evaluation model needs to be some

amendments to adapt to the actual situation.

2.

service features and classification 2.1 Service characteristics

in the field of service management research on the and more is built on top of the traditional

marketing concept, service is seen as an appendage of tangible goods. but then, the service tends

to separate from the traditional concept of the marketing concept and discussed the content of

mm deep ownership services and clients state of change.

Grove Ruth (Gronroos, 2000) definition of service: Service is a series of more or less intangible

activities constitutes a process, this process is the customer and employee tangible resources,

carried out the interaction between these physical resources or physical products, physical care

system is the solution to the problem as provided for customer. From the above definition, we

can see services usually No quality is intangible, can not be visual and tactile perception, but also

that service customers after the products are consumer interests can hardly be perceived, even if

the intangibility of services. services is also reflected in the characteristics of an integral, qualitydifferences, not be stored and non-transferable ownership, etc., indivisible nature of service

production and consumption processes occur simultaneously, can not be stored at the time of

service refers can not be stored, composition and quality of service level changes reflect its

quality difference.

2.2 Definition and classification of service industries

hypothesis: some time: the beginning of all the services provided to the end; Seller: The means to

achieve the required service to maintain the minimum staff; Buyer personnel: Service objects or

the interests of access to services in the most direct staff certain period of time, the number of theSeller (S) and the Purchaser Personnel (P) ratio, that is S / P. When S/Pg1, the industry was:

Skills Upgrading industry; S / P

8/4/2019 FINAL MRP AZISH 28-09-2011

44/61

management activities with customers is not enough communication between the , showing the

managers perceived inconsistency with the customer expectations.

Gap 2: Bad quality of service standards for quality of service does not guarantee a lack of

understanding on the feasibility, standardization work is not enough, and the lack of a clear

target, leading to the gap between 2

3: service specifications and actual delivery of services is to generate the difference between the

reasons for this gap. in general, because employees do not want service in accordance with

specifications.

Gap 4: Service assurance and service delivery do not match. inadequate internal communication

and the exchange of over-commitment of consumers, leading to the gap between actual and

commitment to service.

Gap 5: Expected service experience of service differentiation mm, the gap between 1 and 4 led to

5 generation gap. This gap leads to customer satisfaction, quality of service evaluation.

4. SERVQUAL evaluation model and its practical application

4.1 SERVQUAL evaluation modelSERVQUAL in English quality) of the acronym, the word first appeared in 1988 by

Parasuraman, Zeithamal and Berry co-wrote an article three as br> SERVQUAL customer

perceived service quality evaluation is based on customer expectations on quality of service, the

first measure of customer service expectations, and then measure the perception of customer

service, which calculates the difference between the two, and as the basis for judging the quality

of service levels.

the specific content of two parts: The first part consists of 22 small projects, record the customer

service industry in a particular company's expectations of excellence. The second part also

includes 22 project, which measures consumers to specific companies in this industry (Jibei

evaluation company) feel. and then two parts in comparison to the results obtained by each of thefive dimensions of a . The smaller the gap, the higher the evaluation of the quality of service.

consumers expect from the greater sensibility, the lower the evaluation of the quality of service.

On the contrary, the gap is smaller, the higher the evaluation of the quality of service. So

SERVQUAL is a very inclusive 44 item scale, which come from the five service quality

dimensions of customer expectations and the degree to be able to experience a 7-point

questionnaire and 7 said he fully agreed that 1 is completely disagree, * that score the opposite.

Here are three scholars of the five dimensions.

4.1.1 Tangibles (Tangibles)

include the actual physical nature of facilities, equipment, and a list of other service personnel.

Its components are: 1. with modern services and facilities; 2 . services attractive; 3. employees

have clean clothing and coats; 4. the company's facilities and the services they provide to match

4.1.2 Reliability (Reliability)

reliability is reliable and accurately carry out their service commitments. The components are: 5.

commitment to customers what the company can be completed in time; 6. customers in trouble,

to show interest and help; 7. the company is reliable; 8 . to provide the promised time of service;

9. an accurate record of related records.

8/4/2019 FINAL MRP AZISH 28-09-2011

45/61

4.1.3 responsiveness (Responsiveness)

responsive means to help customers improve service levels and quickly will. its components are :

10. can not expect them to deliver services to customers on time time *; 11. expect them to

provide services in a timely manner is unrealistic *; 12. Staff are not always willing to help

customers *; 13. Staff are too busy to have been working with could not immediately provide

services to meet the needs of customers *.

4.1.4 Assurance (Assurance)

assurance refers to employees with knowledge, courtesy and credible expression of the

confidence and ability. its components are : 14. employees are trustworthy; 15. engaged in the

transaction, the customer will feel at ease; 16. Staff is polite; 17. Employees can receive

appropriate support from the company to provide better service.

4.1 .5 empathy of (Empathy)

Empathy is the way that care for and provide customers with personalized service. The

components are: 18. the company will not provide individual services for customers *; 19.

employees will not give customers individual care *; 20. can not expect employees to understandcustomer needs *; 21. companies do not give priority to the interests of customers; * 22.

Company provided service can not meet the needs of all our customers *.

5. Evaluation of the SERVQUAL model proposed amendment

5.1 SERVQUAL evaluation model is based on the limitations of SERVQUAL conceptual model

of service quality, and given the gap in the five dimensions and five different scoring system to

establish a complete , under the sub-object worthy of the level of service quality evaluation to

quantify the evaluation. in the form of payment collection through questionnaire evaluation of

customer perception of the quality of the object and its service quality, the final weighted score

by some. First, SERVQUAL Evaluation of the developer division aspects of the service sector is

This classification method is SERVQUAL evaluation model must have its limitations, it can notbe classified in the above description better than the industry or somewhere in between the

characteristics of the industry. Second, SERVQUAL evaluation model in five dimensions to

carry out investigation and analysis, followed by the five dimensions of tangibles, reliability,

responsiveness, assurance, and empathy of. in the face of different industries, the importance of

the five different dimensions, there are weights Questionnaire design assignment and the order in

two aspects, which are affecting the use of SERVQUAL model and accuracy evaluation.

Moreover, SERVQUAL evaluation model is based on three sectors (telephone repair, retail

banking and insurance ) in a sample of five companies on the basis of investigation conducted.

On the one hand, the limited sample size of the problem led to the SERVQUAL not clear and

objective. On the other hand, the choice in the industry, telephone repair, retail banking three

industries and the insurance industry can not fully reflect all the common features of the service

sector, at least diminishing the quality of passenger transport industry, the characteristics of these

are not shown. Finally, the SERVQUAL model is a pre-evaluation study that Experience the

ultimate in customer service product benefit questionnaire prior to the making of the

SERVQUAL the answer. tell us the characteristics of service products and customer service from

the consumer interests are often the product has not been perceived, it is difficult to be noticed,

8/4/2019 FINAL MRP AZISH 28-09-2011

46/61

or to go through Over time, consumer services, in order to enjoy this feeling that the interests of

the Russian presence. That is, customer expectations and perceptions may in time have a strong

discontinuity, but the practical application of SERVQUAL in the evaluation method in the time

it takes on continuity, to ensure the smooth implementation of the study.

5.2 SERVQUAL

evaluation model amendments to the classification in accordance with this article, the service

industry can be divided into descending skills to enhance the industry and quality of the industry.

the skills to enhance the industry in a service process provision, the service is greater than or

equal to the number of customers, the customer seeks is so personalized and customized services,

so the service assurance and empathy of the more important.

to law firms, for example, often In a service process requires one or more of the lawyers for the

client services to ensure the accuracy and success of the service. In five dimensions, the

importance of consulting lawyers should be as follows: assurance, empathy nature reliability,

responsiveness and tangibles. not the same as that for decreasing quality of the industry,

reliability and tangibles in customer perception of service is more influential. because ofdiminishing the quality of service provided by the key to success in the industry more dependent

fixed equipment, support, and equipment needs of customers is the convenience and quickness.

to passenger transport industry, for example, the customer service is directly accounts for the

main part of the machinery and equipment, the customer is more practical to enjoy the pursuit of

fast transportation services, so they will be more concerned about the schedule promised by

service providers, etc., then the five dimensions, importance should be followed: reliability,

assurance, tangibles, empathy of and responsiveness. Finally, in the final analysis of the

questionnaire process, different service industries and enterprises should be based on the actual

situation faced by the five dimensions of scores under the weight of a reasonable ratio, the final

summation value. < br> Q = total score of tangible T * a1 + reliability Rel * a2 + responsivenessRes * a3 + Guaranteed A * a4 + transference of E * a5

(a1 + a2 + a3 + a4 + a5 = 1)

Of course, the size distribution of weight will lead to a revised SERVQUAL lack of uniformity

and standardization. more feasible approach is the development of different industries can be

unified within the industry a unified weight program ai.

6. Conclusion

Full Text The amendment in the SERVQUAL method is based on the quality of skills to enhance

the industry and by decreasing based on the industry. the one hand, the issues raised in the article

by field observations, argument, indeed the current model of service quality evaluation problems.

However, whether the division of the service sector be improved, the weight of the five latitude

to set the specific calculation method has yet to be made, so their view of the further study of the

text is very valuable.

(Author: Wuhan University of Technology School of Management)

8/4/2019 FINAL MRP AZISH 28-09-2011

47/61

2.METHODOLOGY

HYPOTHESIS

H01.There is no significant difference between customer satisfaction level of

policy holders of Lic and Bajaj Allianz.

8/4/2019 FINAL MRP AZISH 28-09-2011

48/61

3.DATA COLLECTED

RESEARCH METHODOLOGY

6.1 Design: This study will be discriptive in nature.

6.2 Population :-Population for this study will be the policy holder of LIC andBajaj Allainz who are resident of Indore city.

6.3 Sample:-

Sample Unit:-Individual Life Insurance policy holder of LIC and Bajaj

Allianz will be sample unit which will be formed by visiting the home

And office of policy holder.

Sample Element:-Policy holder of LIC and Bajaj Allianz who have

Atleast paid first premium for their policy.

Sample Size:-The sample size for the present study will be 150.

LIC

75

Bajaj Allianz 75

8/4/2019 FINAL MRP AZISH 28-09-2011

49/61

Sample Method:-For collecting sample non probability convenience

Sampling method will be used.

6.4 Data Collection:-The proposed study would be conducted by collecting

Primary data from Life Insurance policy holder of LIC and Bajaj

Allianz primary data would be collected through structured

questionnaire.

6.5 Data Analysis:-For Hypothesis Anova will be used.

4.EMPIRICAL ANALYSIS

1.Data Analysis Techniques

2.Result &findings

3.Discussion on findings

1.Data Analysis Techniques:

For the present study of the customer satisfaction of Insurance company a structured

questionnaire method is used for primary Data collection .Survey instrument content were basedon 22 items for Expectation and 22 items for Perception relating to customer who have

Insurance policies of companies under the study these items are listed in table 1.

Table 1

EXPECTATION PERCEPTION

ITEMS

NO.

STATEMENT FOR

EXPECTATION

ITEMS

NO.

STATEMENT FOR

PERCEPTION

1 Company will have modern

looking equipment.

1 Company has modern looking

equipment

2 The physical facilities at Companywill be visually appealing.

2 Companys physical facilities arevisually appealing.

3 Employees at Company will beneat appearing.

3 Companys reception deskemployees are neat appearing.

8/4/2019 FINAL MRP AZISH 28-09-2011

50/61

4 Materials associated with theservice (such as pamphlets orstatements) will be visuallyappealing at an Company.

4 Materials associated with theservice (such as pamphlets orstatements) are visually appealingat Company.

5 When Company promise to dosomething by a certain time, theydo..

5 When Company promises to dosomething by a certain time, itdoes so

6 When a customer has a problem,Company will show a sincereinterest in solving it.

6 When you have a problem,Company shows a sincere interestin solving it.

7 Com