A PROJECT REPORT ON

A PROJECT REPORT ON

SUMMER TRAINING AT

RELIANCE LIFE INSURANCE CO. LTD.

TOWARDS PARTIAL FULFILLMENT OF CURRICULUM OF TWO YEAR FULL TIME

M.B.A. PROGRAM

AT R. K. COLLEGE OF BUSINESS MANAGEMENT, RAJKOT.

PREPARED BY :

GOSWAMI SONALI V.

SUBMITTED TO :

Ms. VARSHA VIRANI

( FACULTY, RKCBM, RAJKOT)

PREFACE

Summer training is an integral part of the management program. We could realize and appreciate its importance only after undergoing training at Reliance Life Insurance Company Limited. It is the missing link between the Academia and the practical aspects of the Corporate world. We got a chance to apply our knowledge to real world situation. Reliance Life Insurance Co. Ltd. has a very unconventional style of training summer trainees. They made us feel like working as a part of the organization, wherein we had a chance to try ourselves at marketing, new adviser recruitment, planning and executing various schemes and undertaking a research, a survey on behalf of the organization. All in all, it was a unique experience to undergo training at Reliance Life insurance Company Limited.

Ahmedabad Goswami Sonali V.

ACKENOLEGEMENT

We would like to thank Mrs. Priyanka Shreevastava, Sales manager, Reliance Life Insurance, Ahmedabad, for providing us a chance to undergo summer training at this organization. We sincerely acknowledge her constant efforts with which sevaluated each of us and designed further course of the training. We owe to her a sense of gratitude for the knowledge she imparted with us. We would like to thank Mr. Aarif Pathan, Branch Manager, for his supervision and his valuable guidance throughout the research. He pointed out to us our drawbacks and shaped our skills. His co-operation and guidance during our campaigns at their respective sales territories. We cannot forget our respective Advisor at Reliance Life Insurance, Mr. Satish Gosai, who helped in one way or other throughout our training.

We are extremely thankful to our faculty Ms. Varsha Virani for their kind co-operation throughout the training program. Finally we express our thanks to all those whom we cannot remember right now, but who helped us.

Sonali V. Goswami

EXECUTIVE SUMMARY

To start with, in the very first chapter I am giving an introduction to the Life Insurance of the project which we are doing the project. The introduction include principal of life insurance, history & introduction of IRDA etc.

The second chapter I am giving introduction to the Reliance Life Insurance Company Limited. In this chapter I have included Founder name, History of Reliance Life Insurance, objectives, Head Office address & state name of its branch etc.

The Third Chapter is Product Mix of Reliance Life Insurance. In this chapter I have included Traditional Plans & Unit Link Plan.

The Fourth Chapter I am giving report on Human Resources Department of Reliance Life Insurance. I have included Recruitment, Selection Procedure, Training & Development, Career Planning, Performance Appraisal, Organization Chart, Communication & Employee Benefits & Incentives etc.

In the Chapter Five & Six I am giving report on Marketing & Finance Department of Reliance Life Insurance. I have included in Marketing department Distribution Channel, Sales Promotion Schemes & Comparative Analysis etc. and Finance Department Money Manager, Power of Compounding, Taxation & Fund Performance etc.

The Seventh Chapter I am giving report on Research Methodology of Reliance Life Insurance. I have included Data Source, Sampling Area, Sampling Method, Sample Size, Research Instrument, Method of Contact & Method off making an approach for sales, data collection, questionnaire and its analysis.

In chapter Eight & Nine I would be giving some suggestions & lastly I have concluded the whole project.

CERTIFICATE

This is to be certified that Miss. Sonali Goswami has

completed her summer training & prepared a project

report on general management of Reliance Life -

Insurance Company Limited for the requirement

Of practical study for M.B.A. (Semester III).

Director Prof. In charge

TABLE OF CONTENTS

Sr. No.

CONTENTS

Page No.

1

Introduction to Life Insurance

Principles of Life Insurance

History of Insurance

The Insurance Regulatory and Development Authority (IRDA)

8 17

2

Reliance Life Insurance Company

History

Objectives

Head Office

Branches

Future Plan

18-22

3

Product Mix

Traditional Plans

Unit Link Plan

23-40

4

Human Resources Department

Recruitment

Selection Procedure

Training & Development

Career Planning

Performance Appraisal

Organization Chart

Communication

Employee Benefits & Incentives

41-48

5

Marketing Department

Distribution Channel

Sales Promotion Schemes

Comparative Analysis

49-59

6

Finance Department

Money Manager

Power of Compounding

Taxation

Fund Performance

60-64

7

Research Methodology

Data Source

Sampling Area

Sampling Method

Sample Size

Research Instrument

Method of Contact

Method off making an approach for sales

65-76

8

Suggestion

77

9

Conclusion

78

10

Bibliography

79

11

Annexure

Questionnaire

80-84

CHAPTER : 1

INTRODUCTION TO LIFE INSURANCE

People facing the same risk make contribution to a common fund. The assumption is that the contribution made, represents equal liability of risk happening to any of the individuals based on past experiences of the average number of people who suffer such losses.

Life Insurance is a branch of insurance in which compensation is made available to designated survivors of a decreased person, or to a person on their own survival after a fixed term of years, in return for payments, or premiums. Life Insurance is based on the theory of probability, which determines the level of premium to be paid, and on compound interest, which determines the growth over time, through investment, of the fund constituted by the intake of premiums.

There are special legal principles, which apply to insurance and many are based on the Law of Contract, which is governed by the contract act,1872.

Insurance is a contract between two parties whereby one party called insurer undertakes in exchange for a sum called premium to pay the other party called insured a fixed amount of money on the happening event. Insurance indemnifies asset has a value and its generate the income to its owner.

The income has been created through the expenditure of effort, time and value. Every asset has expected lifetime during which it may be depreciate and at the end of life period it may not be useful, till then the expected to the function. Some times it may cases to exit or mat not be able to function partially like burglary, collisions, earthquake, fire, flood, theft, etc. These types of possible occurrence are risk.

Future is uncertain, no body knows what happen? It may or may not? Insurance is a concept of risk management the need to manage uncertainty on account of above stated risk. Insurance is a way of financing these risks either fully or partially. Insurance business in India can be broadly divided into two categories such as Life Insurance and General Insurance of Non-life insurance. But we focus on the life insurance for the purpose of this project.

Earlier to allowing private to operate, it was necessary to cross the legislative hurdles, such as the passage of Insurance Regulatory and Development Authority Act 1999 and amendment of Life Insurance and General Insurance Corporation Acts.

The words cheap and life insurance are not normally associated with one another, let alone appear in the same sentence.

But this is increasingly becoming something of a misconception. The life insurance market, despite the entrenched and popular perception, is probably more competitive today than it has ever been in the past. This is largely due to a sea change in the life insurance marketplace and radical rethinking in the business operations of insurance companies.

Because the world wide web has widened choice in a way unimaginable just twenty years ago, insurance companies have faced the biggest ever challenge to their business structures. Before the internet there was little incentive for insurance companies to evolve when most customers rarely, if ever, obtained more than two or three life insurance quotes.

But when potential customers suddenly can go online and get quotations from literally hundreds of rival firms, what occurs is the life insurance market equivalent of global climate change. Mirroring Darwins Theory of Evolution, it is then survival of the fittest as life insurance companies complete for the available resources.

The outcome of all this evolution is you, the consumer, have become a prized item that can only be lured by the most attractive life insurance deals possible. Only by putting in the extra effort to cut costs, streamline and modernize business processes can the successful life insurance company hope to thrive and prosper in todays highly competitive and discerning marketplace. By adapting to the new business climate and landscape, life insurance providers can put themselves into a position to offer the cheap life insurance products demanded by the public.

The answer to the question, Is there such a thing as cheap life insurance? must then be, Yes, and right heres a good place to start your hunt!

It would be wrong, though, to assume all this cost cuttery to drive premium down comes with the price tag of inferior quality life insurance policies or poor customer service. Insurance companies are playing a long game here. With a business environment rendered almost unrecognizable to a past generation, life insurance companies are investing in the present to secure a future. This means balancing out across the board efficiencies with the need to improve value for money to the customer and maintain standards of customer service.

Without a doubt, there are plenty of cheap life insurance deals around. The good news is that you have landed in the right place to find exactly what you are looking for.

Several MNCs, in joint Venture with Indian private sectors firms, have started operation in a big way. The prominent private players active right now are, Reliance Life Insurance Company, ICICI prudential Life, Max New York Life, HDFC Standard Life, Birla Sun Life and Bajaj Allianz.

Whod be a dinosaur life insurer when its the warm blooded mammalian life insurance companies that rule the roost?

PRINCIPLES OF LIFE INSURANCE

1. Utmost Good Faith.

2. Insurable Interest.

1.Utmost Good Faith :

A positive duty to voluntarily disclose, accurately and fully facts material to the risk being proposed, whether or not.

The insurer needs to be aware of all the details of the health, family, history, habits, and other facts about the proposer. It is important that the proposer declares all the facts properly and in utmost good faith.

The statement by the proposer was inaccurate or false.

Such an inaccurate or false statement related to a fact that was material to the contract.

Such an inaccurate or false statement was deliberately and fraudulently.

The proposer knew the correct facts at the time of making the false statement.

2.Insurable Interest :

The requirement of Insurable interest dates back to the 18th century. During that time, in order to carry out an insurance contract the person insured need not be informed about it. Therefore there 3rd parties insuring a person for a certain sum without the insured knowing of it.

This arrangement was abused and subject to malicious intentions. One should insure a 3rd party and get the insured killed and benefit monetarily from the proceeds. Thus, the objective of insurable interest is to prevent people from wagering or gaming on the lives of others.

Relationship with the subject matter which is recognized in law and gives a legal right to insure that person.

The insurable interest must be a monetary interest.

Every person has an insurable interest in his/her life. The restrictions in the application of this is the means with which to pay the premium.

Relationships by blood : A father has an insurable in the life of the minor child. The legal position about childrens assurance is not quite clear. It is assumed that parents have insurable interest in the life of a so long as he/she is a child.

Relationship by Marriage : Husband and wife have a automatic unlimited insurable interest in each others lives.

Business Relationships

Business Partners

History of Life Insurance :

The concept of insurance is believed to have emerged almost 4500 years ago in the ancient land of Babylonia where traders used to bear risk of the carvan by giving loans, which were later repaid with interest when the goods arrived safely.

The concept of insurance as we know today took shape in 1688 at a place called Lloyds Coffee House in London where risk bearers used to meet to transact business. This coffee house became so popular that Lloyds became the one of the first modern insurance companies by the end of the eighteenth century.

Marine insurance companies came into existence by the end of the eighteenth century. These companies were empowered to write fire and life insurance as well as marine. The Great Fire of London in 1966 caused huge loss of property and life. With a view to providing fire insurance facilities, Dr. Nicholas Barbon set up in 1967 the first fire insurance company known as the Fire office.

The early history of insurance in India can be traced back to the Vedas. The Sanskrit term Yogakshema (meaning well being), the name of Life Insurance Corporation of Indias corporate headquarters, is found in the Rig Veda. The Aryans practiced some form of community insurance around 1000 BC.

Life insurance in its modern form came to India from England in 1818. The Oriental Life Insurance Company was the first insurance company to be set up in India to help the widows of European community. The insurance companies, which came into existence between 1818 and 1869, treated Indian lives as subnormal and charged an extra premium of 15 to 20 per cent. The first Indian insurance company, the Bombay Mutual Life Assurance Society, came into existence in 1870 to cover Indian lives at normal rates.

The Insurance Act, 1938, the first comprehensive legislation governing both life and non-life branches of insurance were enacted to provide strict state control over insurance business. This amended insurance Act looked into investments, expenditure and management of these companies.

By the mid- 1950s there were 154 Indian insurers, 16 foreign insurers, and 75 provident societies carrying on life insurance business in India. Insurance business flourished and so did scams, irregularities and dubious investment practices by scores of companies. As a result the government decided to nationalize the life assurance business in India. The Life Insurance Corporation of India (LIC) was set up in 1956. The nationalization of life insurance was followed by general insurance in 1972.

Time line in insurance history

Major Landmarks

1818 British introduced the life insurance to India with the establishment of the Oriental Life Insurance Company

in Calcutta.

1850 Non life insurance started with Triton Insurance Company.

1870 Bombay Mutual Life Assurance Society is the first India owned life insurer.

1912 The Indian Life Assurance company Act enacted to regulate the life insurance business.

1938 The Insurance Act was enacted.

1956 Nationalization took place. Government took over 245 Indian and foreign insurers and provident societies.

1972 Non-life business nationalized, General Insurance Corporation (GIC) came into being.

1993 Malhotra committee was constituted under the chairmanship of former RBI chief R. N. Malhotra to draw a blue print for insurance sector reforms.

1994 Malhotra committee recommended reentry of private players.

1997 IRDA (Insurance Regulatory and Development Authority) was set up as a regulator of the insurance market in India.

2000 IRDA started giving license to private insurers. ICICI Prudential, HDFC were first private players to sell insurance Policies.

2001 Royal Sundaram was the first non-life private player to sell an insurance policy.

2002 Bank allowed to sell insurance plans as TPAs enter the scene, insurers start setting non-life claims in the cashless mode.

The Insurance Regulatory and Development Authority (IRDA)

Reforms in the Insurance sector were initiated with the passage of the IRDA will in Parliament in December 1999. The IRDA since its incorporation as a statutory body in April 2000 has fastidiously stuck to its schedule of framing regulations and registering the private sector insurance companies. The other decisions taken simultaneously to provide the supporting systems to the insurance sector and in particular the life insurance companies was the launch of the IRDAs online service for issue and renewal of licenses to agents.

The approval of institutions for imparting training to agents has also ensured that the insurance companies would have a trained workforce of insurance agents in place to sell their products, which are expected to be introduced by early next year.

Since being set up as an independent statutory body the IRDA has put in a framework of globally compatible regulations. In the private sector 12 life insurance and 6 general insurance companies have been registered.

CHAPTER : 2

RELIANCE LIFE INSURANCE COMPANY LIMITED

Dhirubhai H. AmbaniFounder Chairman, Reliance Industries Limited, IndiaDecember 28, 1932 - July 6, 2002Major Group Companies: Reliance Industries Limited,India's largest private sector company.

HISTORY

Reliance Life Insurance Company Limited is a part of Reliance Capital Ltd. of the Reliance - Anil Dhirubhai Ambani Group. Reliance Capital is one of Indias leading private sector financial services companies, and ranks among the top 3 private sector financial services and banking companies, in terms of net worth. Reliance Capital has interests in asset management and mutual funds, stock broking, life and general insurance, proprietary investments, private equity and other activities in financial services.

Reliance Capital Limited (RCL) is a Non-Banking Financial Company (NBFC) registered with the Reserve Bank of India under section 45-IA of the Reserve Bank of India Act, 1934.

Reliance Capital sees immense potential in the rapidly growing financial services sector in India and aims to become a dominant player in this industry and offer fully integrated financial services.

Reliance Life Insurance is another step forward for Reliance Capital Limited to offer need based Life Insurance solutions to individuals and Corporates.

Opportunity has a new name Reliance Life Insurance Company Limited. If you have been waiting for that one job which will enrich your professional and personal life then you are at the right place. At Reliance Life Insurance Company Limited our mission is to be the best in every sphere - business results, customer care and employee focus.

OBJECTIVES :

1

Result Oriented

2

Performance Driven

3

Customer Focused

4

Learning & Development Oriented

5

Employee centric

6

Informal & fun

7

Human Resources

8

Finance

HEAD OFFICE

Reliance Life Insurance Company Limited has a head office in Chennai (India). The whole company is operated in Chennai. The major decision is taken at a head office and it followed by all branches of the country.

Reg. Office : 9, Cathedral Road,

Chennai 600086.

India.

Telephone No. 28118400 Fax: 28117669

BRANCHES

1. ANDHRA PRADESH

VISHAKAPATNAM

OLD GAJUWAKA

KUNOOL

GUNTUR

SECUNDERABAD & MANY OTHER CITY

2. GUJARAT

AHMEDABAD

VADODARA

JUNAGADH

NADIAD

JAMNAGAR

BHAVNAGAR

SURAT

3. KARNATAKA

BANGALORE

JAYANAGAR

INDIRANAGAR

BELLARY

BHARWAD

GADAG & MANY OTHER CITY

4. NEW DELHI

5. KERALA

ERNAKULAM

ALLEPEY

PALAKKAD

KOLLAM

CALICUT

ALUVA

KASARGODE & MANY OTHER CITY

6. TAMILNADU

CHENNAI

ANNANAGAR

TAMBARAM

SALEM

DHARMAPURI

HOSUR

DINDUGUL

VELLORE & MANY OTHER CITY

FUTURE PLANS

2006-2007

Forty- four branches to be opened across the country in the coming months; and a pan India presence with 162 branches in the coming year.

A state of the art customer care centre will provide continuous, responsive services to the caller and promptly address queries, collate feedback and suggestions from the caller, who may be both prospective and existing clientele and from channel partners in Chennai & Mumbai.

CHAPTER : 3PRODUCT MIX

1. Traditional Plans

2. Unit Link Plan

1.Traditional Plans :

There are five sub plans in this plan.

Reliance Endowment Plan (Divya Shree)

Reliance Special Endowment Plan

(Subh Shree)

Reliance Cash Flow Plan (Dhan Shree)

Reliance Child Plan (Yuva Shree)

Reliance Whole Life Plan (Nitya Shree)

1. Reliance Endowment Plan (Divya Shree).

Reliance Life Insurances Reliance Endowment Plan is the key to all your financial needs. It is an inexpensive and easy way to protect you, your family or your business.

In a nutshell this plan will keep you financially prepared for all the special occasions in your life - your daughters wedding, your childs university education or even a new office for your business - by eliminating the burden that a shortage of money creates.

In the event of your untimely death, Reliance Endowment Plan will also assist your loved ones through this difficult time by the financial support that it provides.

Reliance Endowment Plan also gives you the additional benefit of participating in the companys profits, which you will receive at the end of the policy period.

Reliance Endowment Plan is an endowment plan, where you decide how much you would like to set as your sum assured based on your current financial position and your expected future expenses. You also get to choose how long you would like your policy to operate. Then all you need to do is pay your single premium or regular premium for the policy term.

As soon as you pay your single premium, or as long as you continue to pay your regular premiums, your policy will participate in the profits of our company. This means that each year, we will declare a bonus, the amount of which may vary from one year to the next. The cash value of the bonuses which you accumulate over the policy term will be paid to you along with the basic sum assured when it falls due.

Any healthy male or female, who has completed the age of 5 years and is not older than 65 years can avail of this policy.

There are limiting conditions as given in the table below:

MINIMUM

MAXIMUM

Entry Age

5

65

Maturity Age

18

75

Policy Term

5

35 (regular premium)15 (single premium)

Sum Assured

Rs 25,000or as determined by the minimum premium

Rs 5,00,000(entry age below 18 years)No Limit(entry age 18 and above)

Premium

Rs 2,000 for annualRs 1,500 for half-yearlyRs 750 for quarterly andRs 250 for monthly*premium frequencyRs 25,000 for single premium

No limitNo limit

The modes of payment of premiums permitted are yearly, half-yearly, quarterly and monthly. The policy can also be availed under salary deduction scheme. When the mode of payment of premium is half-yearly, quarterly and monthly, the premiums will be rated up. The rating up factors are:

Half-yearly

1.02

Quarterly and Monthly

1.04

The modes of payment of premiums permitted are yearly, half-yearly, quarterly and monthly. The policy can also be availed under salary deduction scheme. When the mode of payment of premium is half-yearly, quarterly and monthly, the premiums will be rated up. The rating up factors are:

Half-yearly

1.02

Quarterly and Monthly

1.04

Premium rebate is allowed on high sum assured policy.

Sum Assured

Premium Rebate per 1,000 Sum Assured

Rs 1,00,000 - Rs 2,49,000

Re 1

Rs 2,50,000 - Rs 4,99,000

Rs 2

Rs 5,00,000 - Rs 9,99,000

Rs 3

Rs 10,00,000 and above

Rs 4

2. Reliance Special Endowment Plan (Subh Shree).

This insurance policy is designed for people who wish to combine savings with extended security. The unique feature of this policy is that life protection continues for five years after you have stopped the payment of premium. Payment of sum assured at the end of premium paying term and extension of life cover thereafter for the full sum assured for a period of 5 years, are characteristics of the policy. This plan also participates in the profits.

The special benefit under this policy is that it ensures securing a fund for the future when it is most needed and gives much needed financial security for the family.

The unique feature of this policy is that the risk cover continues for the full sum assured for an extended period of 5 years even, after payment of the full sum assured at the end of the premium paying term.

This policy also participates in the profits. Bonus is compounded yearly (i.e. bonus declared in the previous year earns bonus in the next year) and is payable at the end of the policy term. Any healthy male or female, who has completed the age of 12 and is not older than 65 can avail of this policy.

The minimum amount for which a Reliance Special Endowment Plan policy can be taken is Rs.25,000. There is also a limitation on the minimum premium paying term which is 10 years, while the maximum term is 40 years.

The full sum assured under the policy will be paid at the end of the premium paying term instead of waiting till the maturity of the policy, that is, a full five years in advance. Again, at the end of the policy term, the full bonuses will be paid.

If death takes place during the term when the premiums are still being paid, the full sum assured along with accrued bonus up to the date of death will be paid immediately.

If death takes place after all the premiums have been paid , an amount equal to the sum assured under the policy along with accrued bonuses up to the date of death will be paid immediately. This will be in addition to the sum assured already paid at the time of completion of premium paying term. For a marginal additional premium payment, you can opt to have the Accident benefit and/or the Critical Illness benefit.

Subject to certain conditions, if death of the policy holder is caused by an accident, an additional lump sum is payable.

This benefit provides a lump sum payment in the event of a specified serious illness like a stroke or heart attack suffered by the Life Assured.

Provided premiums have been paid for three continuous years, the sum assured as stated above will be reduced in proportion to the premiums paid to total amount of premiums payable. Bonuses already declared will not reduce but the policy will cease to participate in future profits. The reduced sum assured is payable at the end of premium paying term or on earlier death. Vested bonuses are payable on survival to maturity date or on earlier death. If you have opted for additional benefits, these will be available only so long as premiums are paid regularly. In any case, Accident and Critical Illness benefits are not available beyond the age of 64 years.

There is the usual exemption from tax, for premiums paid, as per the IT Act. The money you have invested earns interest and comes to you in the form of terminal benefits and Bonus, without the insecurities attached to the ups and downs of the money market. Further, at Reliance Life Insurance, we offer you the best of courtesy, prompt service and a high level of financial security.

3. Reliance Cash Flow Plan (Dhana Shree).

This insurance policy is designed for those who have a recurring need for reinvestment in business or look for short-term investment channels. The advantage of the policy is that they need not part with a sizable amount of money at any one time, but create, through regular premium payments, a periodic return of lump sums which become available for reinvestment at higher returns, while providing simultaneously, substantial life cover.

Alternatively, it can be used to meet any immediate financial crisis in the family like your son's college admission, your daughter's engagement, renovation of your home or perhaps, a holiday abroad.

The money is payable in installments. The first installment is paid at the end of the 4th year and thereafter at the end of every 3rd year.

The special benefit under this policy is that it ensures liquidity through a periodical return of a specified amount of money, once in every 3 years. It averts the necessity to look elsewhere for loan facilities.

A unique feature of this policy is that the risk cover continues for the full sum assured even though the periodical payments are being made. This policy also participates in the profits and is eligible for bonus.

Any healthy male or female, who has completed the age of 15 and is not older than 63 can avail of this policy.

The minimum amount for which a Reliance Cash Flow Plan policy can be taken is Rs.25,000. There is also a limitation on the minimum premium paying term which is 7 years, while the maximum term is 34 years. An important point to note is that since periodical payments are available, it will not be necessary for you to raise a loan. Hence, there is no provision for granting a loan under this policy.

You receive the first payment at the end of the 4th year and subsequent payments at intervals of 3 years. The entire vested bonus is paid along with the last installment on the date of maturity of the policy.

The full sum assured under the policy along with accrued bonuses up to the date of death, will be paid immediately. The installment amounts already paid will not be deducted from the claim amount.

Subject to certain conditions, if death of the policy holder is caused by an accident, an additional lump sum is payable. This benefit provides a lump sum payment in the event of a specified serious illness like a stroke or heart attack suffered by the Life Assured.

Provided premiums have been paid for three continuous years, the sum assured will be reduced in proportion to the premiums paid to the total amount of premiums payable less any survival benefits paid. Vested bonuses will not reduce but the policy will cease to participate in future profits. The reduced sum assured along with vested bonuses is payable on maturity date or on earlier death. If you have opted for additional benefits, these will be available only so long as premiums are paid regularly. In any case, Accident and Critical Illness benefits are not available beyond the age of 64 years.

This aspect of the liquidity is taken care of by the very characteristic of the policy, namely the repayment of money to you periodically. This benefit comes to you without taking away your valuable life cover.

Yes, there is the usual exemption from tax, under Section 80C for premiums paid, as per the IT Act, 1961. The money you have invested earns interest and comes to you in the form of terminal benefits and Bonus, without the insecurities attached to the ups and downs of the money market. All your policy benefits, which you receive, are exempt from tax under section 10(10D) of the IT Act, 1961.

4. Reliance Child Plan (Yuva Shree).

This insurance policy is designed for people who wish to save money for a future time when there will be a recurring need for substantial amounts of money. This is especially true when it comes to paying large sums of money for higher education as and when your son or daughter is studying to become an Engineer, a Doctor or specialize in some other field, or is perhaps planning to go abroad. This money is payable in equal installments over the last 4 years of the policy term.

A unique feature of this policy is that the risk cover continues for the full sum assured even though the periodical payments are being made. This policy also participates in the profits for the full term of the policy.

Any healthy male or female with adequate income, who has completed the age of 20 and is not older than 60. The minimum amount for which a Reliance Child Plan policy can be taken is Rs.25,000. There is also a limitation on the minimum term which is 5 years, while the maximum term is 20 years.

The sum for which you have taken the Reliance Child Plan policy will be paid to you in four equal installments during the last four years of the policy. You will also get full bonuses along with your final installment.

An amount equal to the sum for which you have taken the policy will be paid to your family immediately. This will not be affected by any survival benefits already released. This will also not affect the four installment amounts and bonus payable and that will be paid as provided for, in case death claim occurs earlier. For a marginal additional premium payment, you can opt to have the Accident benefit and/or the Critical Illness benefit.

Subject to certain conditions, if death of the policy holder is caused by an accident, an additional lump sum is payable.

This benefit provides a lump sum payment in the event of a specified serious illness like a stroke or heart attack suffered by the Life Assured.

Provided premiums have been paid for three continuous years, the sum assured as stated above will be reduced in proportion to the premiums paid to the total amount of premiums payable less any installment benefits paid. The benefits pattern remain the same. Vested bonuses will not reduce but the policy will cease to participate in future profits. If you have opted for additional benefits, these will be available only so long as premiums are paid regularly. In any case, Accident and Critical Illness benefits are not available beyond the age of 64 years.

Loans can be taken against the surrender value of the policy, after three years' premiums have been paid. This benefit comes to you without taking away your valuable life cover.

There is the usual exemption from tax, for premiums paid, as per the IT Act. The money you have invested earns interest and comes to you in the form of terminal benefits and Bonus, without the insecurities attached to the ups and downs of the money market. Further, at Reliance Life Insurance, we offer you the best of courtesy, prompt service and a high level of financial security.

5. Reliance Term Plan (Raksha Shree).

This insurance policy is designed for those who only want life cover for the protection of their family, and do not wish to save for themselves. It can also be useful to business firms that wish to provide financial security to their business against the sudden loss of partners or valuable manpower. Since there is no saving element or bonus provision, the premium is very low. Hence, this is a high risk plan with a low premium

The special benefit under this policy is that it ensures protection for you and your family and your business as well at a very low premium.

If you are a healthy individual with adequate income, and if you are in the age group of 21 to 60, you are eligible for this policy.

Yes, the minimum amount for which this policy can be taken is Rs.2,50,000. There is also a limitation on the minimum term, which is 5 years, while the maximum term is 30 years. There is no upper limit for the sum assured. Critical Illness Benefit is not permissible as an additional benefit and, no bonuses are payable under this policy. It is also not possible to take loans on the strength of this policy.

As the main objective of this plan is to provide maximum cover against the risk of death, no benefit is payable during the life time of the insured.

An amount equal to the sum for which you have taken the policy will be paid to your nominee immediately.

Yes, for a marginal additional premium payment, you can opt to avail of Accident benefit equivalent to the basic cover. However, the maximum cover is restricted to Rs.50 Lakhs.

Subject to certain conditions, if death of the policy holder is caused by an accident, an additional sum is payable equal to the accident cover opted for.

The policy will lapse immediately and all benefits will cease, since no grace period is available beyond 30 days. However, the policy can be reinstated any time during the term of the contract subject to certain conditions. The accident benefit will be available only so long as premiums are paid regularly. In any case, the Accident benefit is not available beyond the age of 64 years.

As the amount to be insured is substantial you can pledge your policy as a collateral security for housing/commercial loans.

The premiums paid are eligible for income tax relief under Section 80C of I.T Act,1961. Also, all amounts received at the time of claim are also exempted from tax under section 10(10D). Further, at Reliance Life Insurance, we offer you the best of courtesy, prompt service and a high level of financial security.

6. Reliance Whole Life Plan (Nitya Shree).

Even though you have paid your premiums only over a limited premium paying term, the life cover continues up to age 85. You have the option of extending the cover even after age 85.

On attaining your 85th birthday you can choose to terminate the policy. In that case, you will be paid the sum assured as well as the accrued bonuses. If you do not wish to avail of this maturity option at age 85, then the risk cover continues till your 99th birthday, or is terminated earlier in case of death.

An amount equal to the sum for which you have taken the policy along with the accrued bonus till date of death will be paid to your family immediately.

Yes, for a marginal additional premium payment, you can opt to have the Accident benefit and/or the Critical Illness benefit.

Subject to certain conditions, if death of the policy holder is caused by an accident, an additional lump sum is payable.

This benefit provides a lump sum payment in the event of a specified serious illness like a stroke or heart attack suffered by the Life Assured.

Provided premiums have been paid for three continuous years, the sum assured as stated above will be reduced in proportion to the premiums paid to the total amount of premiums payable. Vested bonuses will not reduce but the policy will cease to participate in future profits. The reduced sum assured along with vested bonuses is payable on policy anniversary immediately after age 85 or earlier death. If you have opted for additional benefits, these will be available only so long as premiums are paid regularly. In any case, Accident and Critical Illness benefits are not available beyond the age of 64 years.

Loans can be taken against the surrender value of the policy, after three years' premiums have been paid. This benefit comes to you without taking away your valuable life cover.

There is the usual exemption from tax, for premiums paid, as per the IT Act. The money you have invested earns interest and comes to you in the form of terminal benefits and Bonus, without the insecurities attached to the ups and downs of the money market. Further, at Reliance Life Insurance, we offer you the best of courtesy, prompt service and a high level of financial security.

2. Unit Link Plan

1. Reliance Market Return Plan (Kanaka Shree).

The course of your life can change with time. But then, it is still your life. What you need is a sound financial plan to take care of your investment needs and a sound insurance plan to cover life risks. How about tossing a coin that gives heads on both sides! You could look for a single plan that takes care of your investment and insurance needs.

Good returns from a sound investment and the security of life cover with one basic investment plan, is the most cost effective and profitable financial solution. A unit-linked insurance plan helps you invest your money in various investment funds and enjoy investment benefits and insurance benefits at the same time.

Your money is precious to you. The worth of money depends on how you make it grow, how you make the most of market conditions. To get the best returns you can invest in bank deposits, bonds, shares and other investment instruments. While fixed income investment instruments provide you with security, this income is still susceptible to fluctuations in inflation. To maximise your returns, in the long term perspective, you cannot ignore the high returns and buffer from inflation that the equity market offers. One has to balance the security offered by fixed income securities and the high returns offered by the equity markets. A sound investment plan has to provide you with options to protect you from market risks and the effects of inflation. Do you have the expertise to do so? Our experienced fund managers, provide you with this expertise and the logistics to guide you through the changing world of the money markets and help you reap better returns in the future. With added insurance cover, you have a coin that tosses-up head both ways- that is Reliance Market Return Fund.

Reliance Market Return Fund is the unit-linked product that helps you invest in the financial markets in a combination of investment instruments of your choice. You can enjoy the returns from the markets without the trouble of monitoring and managing your own investment portfolio and keeping track of the market movements. At the same time your investment premiums provide you with insurance cover. Reliance Market Return Fund unit-linked insurance plan provides you with a basket of fund options that balances your return and risk exposure while providing life cover at the same time.

Capital Secure Fund This fund offers steady returns for very little risk. Your funds are invested 100% in bank deposits, government bonds and debt instruments that offer financial security.

Balanced Fund In this fund, a major portion of your funds are invested in fixed securities while a small percentage is invested in the equity market which is exposed to market movements.

Growth Fund - This fund offers a greater portion of investment in the equity market. The greater exposure to the equity market means that returns will be higher, but with the attendant higher level of risk.

Equity Fund This fund offers a totally equity based investment option. Your returns depend entirely upon the performance of the equity market. The higher risk of this portfolio means that expected returns will also be higher.

The premiums you pay are invested into the funds according to your choice. Your investment is expressed in terms of units, the value of which varies according to the performance of the funds. Unit prices are calculated regularly for each fund using the following formula:

Unit Price =

Total market value of assets plus current assets less current liabilities less provisions

Total number of units on issue

Regular Premium You can select a regular payment mode of your choice to build up your unit account. Such regular payments continue till the maturity date of the policy.

We will invest your premiums in the investment funds of your choice in the proportions that you specify subject to regulatory norms. Under current regulations, you may invest up to a maximum of 20% of your premiums into the Capital Secure Fund at the commencement of your policy.

Single Premium You can start your unit account with a single premium payment of Rs 25,000 or more. We will invest your premiums in the investment funds of your choice in the proportions that you specify subject to regulatory norms. Under current regulations , you may invest up to a maximum of 20% of your premium into the Capital Secure Fund at the commencement of your policy.

Top Premium. When you have additional funds, you can enhance your unit account with top-up premiums of Rs 2,500 or more. You may make top-ups on your regular or single premium policy at any time to further build your portfolio. These top-ups do not affect your sum insured; they simply increase your investment in the funds.

SwitchesOne switch per policy year absolutely freeYou can switch between investment funds anytime you wish. This provides you with the freedom to change your investment plan and maximise your returns depending on the performance of the funds in the market. For instance, if you feel the prospects for the share market are good and you would like greater exposure to the market situation, you may switch to a fund that offers greater participation in the equity market.

Redirection are free of cost. At any point you can redirect your premiums to other investment funds. Once your requisition reaches us, your future premium payments will be redirected to the investment fund/s of your choice.

Withdrawals

The withdrawal option provides you with the right amount of liquidity such that you can draw from your unit account without disturbing the insurance cover you enjoy. Once the policy is in force for at least a year, you can make partial withdrawals from your unit account.

Beyond 3 years of your policy term, you can make partial withdrawals up to to a maximum of Rs 5,000, even if your unit account balance is less than the sum insured. If the unit account balance is more than the sum insured, you can withdraw the difference between the account balance and the sum insured plus the Rs.5,000.

Higher withdrawals may be considered subject to underwriting and evidence of good health. After each withdrawal unit account balance should be at least Rs.10,000. You can make 2 such partial withdrawals per policy year.

After 1 year of the policy being in force you can make 2 partial withdrawals per policy year. If your unit account balance is less than the sum insured you can withdraw a maximum of Rs 5,000, leaving a minimum balance of Rs.10,000.

We will cancel units to the value of each withdrawal from the unit-linked funds according to the proportions that you specify from any of the investment funds you have opted for. Units equivalent to your withdrawal amount will be deducted from your account. The withdrawal amount will be paid to you after deducting applicable charges.

Variable Return Your unit account can attract greater returns depending on your choice of investment funds and their performance in the market. Under current tax legislation, the earnings on your investments accumulate free of tax.

If your unit account value is less than the unit value of the sum total of all charges due from you (insurance charges + investment charges + monthly administration charges) then the policy can lapse and you will not enjoy the benefits.

The Reliance Market Return Fund unit-linked policy provides death benefits with flexible options. Your premiums are invested in investment funds of your choice while at the same time you enjoy the privilege of insurance cover.

If the life insured dies before the maturity date, the policy holder/beneficiary will receive the full value of the unit account or the sum insured whichever is higher.

Suicides Clause. If the life insured, whether sane or insane, commits suicide within 12 months from the date of commencement of this policy we will limit the death benefit to the value of your unit account. Insured benefits are not paid in this case.

This benefit doubles the life coverage in case of death or permanent total disability due to an accident at a very nominal additional cost. The maximum cover offered is Rs 50,00,000

In case of total and permanent disability, 1/10th of the sum insured will be paid at the end of each year for ten years. If the total and permanent disability benefit has commenced, then the accident cover will cease.

In case of maturity or on death of the life assured, after the payment of any installments of the permanent and total disability benefit, the remaining unpaid installments, if any, will be paid in one lump sum.

Total and permanent disability means disability caused by bodily injury which causes permanent inability to perform any occupation or to engage in any activities for remuneration or profits. This disability should last for at least 6 months before being eligible for total and permanent disability benefits.

Revision of Charges

We may increase the investment management charges at any time but they will not exceed 2% pa for the Capital Secure Fund and 2.5% pa for the other funds. Any changes made to the charges or fees under this policy will be subject to IRDA approval.

15 day free look periodYou are entitled to a free look period of 15 days. If at the end of this time you do not wish to continue this policy then you may write a letter requesting us to cancel the policy. We will refund the premium paid by you after deducting a proportionate premium for the cover we provided you during that time. We will also deduct any expenses, medical examination costs and stamp duty charges incurred by us in respect of your policy.

CHAPTER : 4

HUMAN RESOURCES DEPARTMENT

Reporting to the Human Resources Director, the Human Resources Generalist will provide staffing, employee relations, performance management, compensation and related support to RLI's sales and marketing group totaling approximately 350-400 employees within 27 geographic locations throughout the USA. On a routine basis, works closely with Regional AVP's, Regional Sales Managers and Office Administrators to coordinate and implement these functions consistent with Company policies, guidelines, goals and objectives.

In the area of Human Resources the company is looking towards fulfilling our core values through:

1

An open environment enabling free interaction between all levels.

2

A balanced scorecard approach to strategy deployment and performance measurement which set goals and measure financial, customer focused, process related and employee development related initiatives.

3

Aggressive Reward & Recognition plans including sales incentives.

4

Career Development plans that will identify potential and create avenues for growth.

5

Intensive training practices for both functional as well as competency development.

6

Knowledge sharing and certification practices.

7

Planned team building and fun events.

8

Creating Reliance Life Insurance family including employees, associates and their families.

RECRUITMENT :

Recruitment procedure is done on the following basis.

1. The Sales Manager of the company has right to recruit the advisor.

2. Every Sales Manager has a team of advisor.

3. Advisor is recruited on the basis of good communication, educated & good knowledge about insurance industry.

4. For becoming an advisor there are procedure. The advisor has to fill up a form & has to pay Rs.500/- as a examination fees.

5. After filling the form advisor has to attempt examination and has to pass that examination.

6. After passing the exam the company give the code & license of advisor.

7. This license is valid up to three years from the issue of the license. After three years the advisor has to give examination for continuation of the license.

8. The Advisor has given a Product Training by the company for the knowledge of the different product of the company. Advisor can continue the business if he has license.

SELECTION PROCEDURE :

Selection Procedure is done for the Sales Managers of the company. Reliance Life Insurance Company Limited has done selection procedure as under:

1. The Sales Manager should be MBA.

2. The minimum age of the Sales Manager should be 25 and maximum should be 35 at the time of getting job.

3. To become the Sales Manager, he should have the experience of minimum 3 years.

4. He should have the good communication power.

5. the job profile of the Sales Manager includes training, guiding, motivation & inter getting the business and the team of the Sales Manager.

6. First of all the company arrange the personal interview of the Sales Manager.

7. The second stage of the selection procedure is project 4 interview.

8. The third stage of the selection procedure is Regional head interview.

9. After completion of Regional head interview the selection of the person is done and negotiation is done.

TRAINING & DEVELOPMENT

For Sales Manager-

1. The Sales Manager has given a training for doing good job and for knowing rules & regulation of the Reliance Life Insurance Company Limited.

2. For the development of Sales Manager the company provide different types of programs for the motivate the Sales Manager.

For Advisors-

1. After getting the code & license by the company the company provides 100 hrs. training for the knowledge of Insurance industry.

2. Company provides another product training for the knowledge of the product (policy) for doing the business.

3. The development of the advisor has done by the Sales Manager like give guidance etc.

4. For the development & motivate the advisor the company gives different types of commission incentives & gifts also.

CAREER PLANNING :

1. The Sales Managers has to plan their career for job. The Sales Managers has to plan how they work for the company.

2. The Sales Manager has to plan for the whole month that the targets given by the company.

3. For the betterment of the career the Sales Manager try to achieve their targets.

Opportunity has a new name Reliance Life Insurance Company Limited. If you have been waiting for that one job which will enrich your professional and personal life then you are at the right place. At Reliance Life Insurance Company Limited our mission is to be the best in every sphere - business results, customer care and employee focus. Some of our core values are:

1

Result Oriented

2

Performance Driven

3

Customer Focused

4

Learning & Development Oriented

5

Employee centric

6

Informal & fun

PERFORMANCE APPRAISAL :

1. Performance Appraisal means to check the performance of the all employees working in the company.

2. The Sales Managers performance is appraised every 3 months & every 6 months & yearly also. So, that the company can know what is the situation of the company in the market.

3. The performance is appraised on the basis of the business done by the Sales Manager performance appraisal is necessary for the company.

ORGANISATION CHART

In Reliance Life Insurance there are several employees working in the organization. Reliance Life Insurance is very big organization. It includes many state of the country. There are many branches and sub stations of the company. The organization work is handled by the C.E.O. (Chief Executive Officer) than in under of C.E.O., C.M.O. (Chief Marketing Officer) in under C.M.O., Channel Head is working.

The C.E.O. , C.M.O. & Channel Head is included in top level management. Than comes the middle level management. In middle level management Regional Manager & branch manager is included. The last is bottom level management. In it the Sales Managers & the Advisors are included.

The graphical presentation of organizational chart is given below:

61%

39%

Gilts

Bank Deposite

C.E.O.

C.M.O

CHANNEL HEAD

REGIONAL MANAGER

BRANCH MANAGER

Sales Sales Sales Sales Sales Manager Manager Manager Manager Manager

Advisors Advisors Advisors Advisors Advisors

COMMUNICATION :

The communication is very necessary for the company. The communication style of Reliance Life Insurance is up word and the communication is done from bottom level to top level management.

The graphical presentation of communication chart is given below :

61%

39%

Gilts

Bank Deposite

Non_itional Plans

EMPLOYEE BENEFIT & INCENTIVES :

The Reliance Life Insurance Company has give good benefit in terms of salary, different types of intensive, allowances, perquisite, gifts etc. to the employees.

1. The Sales Manager has given good salary and extra allowances like petrol allowance, commissions and different types of intensives.

2. The Reliance Life Insurance has introduced a scheme Subharambh in this scheme the employee can win the different type of prizes at the different level of target achieved.

3. The Advisor has given the commission on the basis of doing their business.

4. The Advisors can also win the prizes in Subharambh if they achieve the given target.

5. The Special scheme for the Advisors in Reliance Life Insurance is RARE (Reliance Advisors Rewards Experience) in this scheme the Advisors can get the reward on the basis of that experience.

CHAPTER : 5

MARKETING DEPARTMENT

Reliance Life Insurance has a good marketing department. There are several segments like Distribution channel, Sales promotion and Advertisement in marketing department. Due to marketing department the Sales of the company is increased.

DISTRIBUTION CHANNEL :

INSURANCE

Agency Bank Corporate Rural Benefit Web world

Agency- The first distribution channel is agency. In agency the selling of the product is done through Sales Managers and Advisors. The Advisors is done the business through references.

Bank- Sometimes the Assurance is tie-up with the bank. The insurance of the party is done through bank.

Corporate- The insurance of the small dealer and enterprises is done through corporate. In this type of channel the risk cover of whole employees of the enterprise is covered.

Rural Benefit- Most of the insurance company is not working in the rural areas. But Reliance Life Insurance is working in rural area also. The distribution channel is very effective in Reliance Life Insurance. Due to rural area the company can cover good business in very short time.

Web World- In this type of distribution channel the internet is working very effectively. The Web world is directly tie-up with customers. Due to Web world the more customers can be collected and business is increased.

Due to distribution channels the more business is done by Sales Managers and their Advisors in very short time.

SALES PROMOTIONS SCHEME :

The Reliance Life Insurance Company Limited has introduced various Sales Promotions Scheme. To motivate the employees for better business Sales Promotion Scheme is very necessary. Currently the Reliance Life Insurance has introduced three Sales Promotion Scheme for employees of the company.

1. Shubharambh

2. R.A.R.E (Reliance Advisors Rewards Experience)

3. Elate Club

1. Shubharambh

Currently The Reliance Life Insurance has introduced a scheme named Shubharambh in this scheme the Advisors can get different types of prizes if they achieve the target.

The table given below is present the different gifts if the Advisors collect the premium.

ACHIEVERS

SLAB (WRP)

REWARD

30000

Reliance Life T-Shirt

50000

Table Top Clock

75000

Leather Bag

100000

World Space Radio

150000

L.G. Microwave 19L

200000

DVD/VCD/MP3 Player

300000

Sony Music System

SUPER ACHIEVERS

SLAB (WRP)

REWARD

500000

L.G. Refrigerators GL -233

750000

L.G. Air Conditioner 1T

1000000

Sony Digital Camcorder

1500000

Trip to Dubai 3D/4N

2000000

Hero Honda Splendor

STAR ACHIEVERS

SLAB (WRP)

REWARD

5000000

Maruti Alto Std.

7500000

Maruti Swift Lxi.

10000000

GM Aveo 1.4LS

2. R.A.R.E.(Reliance Advisors Rewards Experience)

The R.A.R.E. program consists of

New Advisor Incentive Program

Board of Advisor

Annual Discovery Series

Advisor Career Progression

R.A.R.E. club loyalty program

New Advisor Incentive Program-

It provide the new Advisors the right and confident start to their business. Bring out a sense of achievement and confidence to the new Advisors. Ensure that the Advisors see money in the business and spend more time towards this business.

Benefit- If the Advisors is collect three policies issued within the first 30days of licensing than they can earns points worth Rs.1000/-. A Certificate of Appreciation. If the Advisor is collect five policies issued within first 60days of licensing than they can get advisor earns points worth Rs.2000/- and a certificate of appreciation and trophy.

Board Of Advisors-

A recognition based program, where the top advisors get to represent their fraternity and provide suggestion to the company. Provide a platform to the advisors to meet the Management at various levels & contribute. An great opportunity for the Management to interact with the Actual Sales Force. They get to meet the CEO along with some of the top Management staff.

There will be three levels of qualification to the Board of Advisors: (A) Regional Board of Advisors (B) National Board of Advisors (C) Executive Board of Advisors.

During each of the Board Meeting, the best suggestion will be recognized and the advisor will be a given a Certificate of Appreciation. Advisors will get points credited into their account on qualifying for each of the slabs.

Annual Discovery Series-

The Discovery Series will be an annual event, which will provide an opportunity to

Discover ways for Self Development

Discover new places across the Globe and India

Discover new areas of interest

Discover about your Company

There will be two Discovery Series held every year

One in a foreign location Global Discovery Series

The other being in India National Discovery Series

Program Advisor Career Progression

Provide the Advisors the right environment to grow & generate more business. Provide them an opportunity to leverage their performance into building a business. Provide them the opportunity to be an employee of Reliance Life Insurance.

Advisor Career Progression

A. Business Associate

B. Sales Manager

R.A.R.E. Club loyalty program

In Pursuit of the Extraordinary Performers, Reliance Life presents a Unique Loyalty Program RARE Privilege Club, built with exclusive benefits & special recognition programs for Advisors at Reliance Life. Truly, a Rewarding Experience!

Recognize the performing advisors and provide them with differential benefits. Provide them with long term benefits through a Loyalty Program.

3. ELATE CLUB

Elate Club is also promotional scheme. If an Advisor collect Rs.2 lacks as a premium then they are qualify in Elite Club. In Elate Club the company offers lunch & dinner in good Hotels or Restaurant every month. The company also gives different types of gifts on special occasion.

COMPERATIVE ANALYSIS

1. Comparative Analysis of premium Underwritten

First Year Premium Underwritten By Life Insurers For The FY 2005-06

No

Insurer

Premium %

1

LIC

71.44

2

Bajaj Allianz

7.56

3

ICICI Prudential

7.35

4

HDFC Standard Life

2.87

5

SBI Life

2.31

6

Birla SunLife

1.89

7

Tata AIG

1.29

8

Max New York

1.23

9

Aviva

1.14

10

Kotak Mahindra OLD Mutual

1.11

11

ING Vysya

0.79

12

Reliance Life

0.54

13

MetLife

0.40

14

Sahara Life

0.06

15

Shriram Life

0.03

2. COMPARATIVE ANALYSIS OF CAPITAL FUND (Investment)

Capital Fund

Rs. (In Crore)

ICICI Prudential

375

Max New York

250

HDFC Standard Life

218

Bajaj Alliance

200

Tata AIG

183

Birla Sun life

180

Aviva

155

OM Kotak

153

Reliance Life

126

SBI Life

125

Met Life

110

ING Vysya

110

0

50

100

150

200

250

300

350

400

Rs. (In Crore)

ICICI Prudential

Max New York

HDFC Standard Life

Bajaj Alliance

Tata AIG

Birla Sun life

Aviva

OM Kotak

Reliance Life

SBI Life

Met Life

ING Vysya

3. COMPRATIVE ANALYSIS OF MARKET SHARES OF DIFFERENT COMPANIES

No.

Name of the Company

Marketshare (%)

1

L I C

82.30

2

ICICI Prudential Life

5.63

3

Birla Sunlife

2.56

4

Bajaj Allianz

2.03

5

SBI Life

1.80

6

HDFC Standard

1.36

7

Tata AIG

1.29

8

Max New York

0.90

9

Aviva

0,79

10

Kotak Mahindra

0.51

11

ING Vysya

0.37

12

Reliance Life

0.26

13

Met Life Insurance

0.21

0

10

20

30

40

50

60

70

80

90

Marketshare (%)

L I C

ICICI Prudential Life

Birla Sunlife

Bajaj Allianz

SBI Life

HDFC Standard

Tata AIG

Max New York

Aviva

Kotak Mahindra

ING Vysya

Reliance Life

Met Life Insurance

Here we can see from the diagram that LIC is the market leader and it commands the major part of the total life insurance market. Its market share was approximately 98% before 2000 but after the entry of private players it has significantly decreased.

Among private players ICICI Prudential stands first. It has the market share of approximately 5.7% in the total market and it constitutes 40% of the market share among private players.

Birla Sun life Insurance Company comes third. Bajaj Allianz is also one of the fastest growing life insurance companies in India. Rest of the players have market share below 2%.

4. STRATEGIC PARTNERSCompany

Foreign Shareholder

Indian Share holder

Allianz Bajaj LifeAllianzBajaj Auto

Reliance Life

-

Reliance Capital

Birla Sunlife

Sun Life of Canada

Birla Global Finance

Dabur CGU

CGNU

Dabur

HDFC Standard Life

Standard Life

HDFC

ICICI Prudential

Prudential (UK)

ICICI

ING Vysya

ING

Vysya Bank

Max New York Life

New York Life

Max India

MetLife India

MetLife

Jammu & Kashmir Bank

OM KOTAK Mahindra

Old Mutual

Kotak Mahindra

SBI Life

Cardiff

SBI

Tata AIG

AIG

Tata

CHAPTER : 6

FINANCE DEPARTMENT

1. Money Manager:

In the broadest sense, anyone who earns an income and pays bills does financial planning. Financial planning is the process of meeting your life goals. Life goals can include buying a house, saving for your childs higher education or planning for retirement. Financial planning is the process of meeting your life goals through the proper management of your finances.

2. Power of Compounding

Beside inflation, you also have to keep in mind the effect of compounding. On one hand, while inflation is working at eroding your income, it is the power of compounding that works in the opposite direction and looks to maximize the returns on your investment. Like stated earlier, when you reinvest an amount of money, there is a snowball effect that is created, which can benefit you in the long-run. For instance, if you invest Rs.1000 at say, 8 percent annual interest, you will receive Rs.1080 which if you reinvest, along with the returns, after 5 years you will receive around Rs.1469.33 as shown in the table below :

Year

Amount Invested

Returns at 8% pa

Total

1

1000.00

80.00

1080.00

2

1080.00

86.40

1166.40

3

1166.40

93.31

1259.71

4

1259.71

100.78

1360.49

5

1360.49

108.84

1469.33

This means after 5 years, you have received a whopping 47 percent cumulative return on your investment. This is the power of compounding.

3. Taxation

Lastly, while investing one has to consider various taxation issues that are involved. Different type of instruments offers tax saving under different schemes. For instance, the section 80L is very important for individual investors. Section 80L provides for a maximum deduction of Rs15000 from the interest income arising out of investments in certain Post Office schemes, PSUs, Financial Institutions, Housing finance companies, Government Securities, Banks and dividend income from Shares.

4. Fund Performance

Capital Secure Fund : In line with the objective of protecting the capital against any erosion, 61.4% of the funds were invested in short-term Government Securities (Gilts) and to meet liquidity requirement higher about 40% of funds are kept in short term bank deposits. The net return credited to policy holders and the asset composition ratios are given in the boxes below.

Net Returns during last 1 months (Mar.06)

0.36%

Net Returns during the last 3 months (Jan.-Mar.06)

1.10%

Net Returns during the last 12 months (Apr.-Mar.06)

4.09%

Net Returns Since Inception in Feb.03 (Annualized)

3.89%

Asset Allocation

Capital Secure Fund

Balanced Fund: To take advantage of the bullish trend in the equity market, the equity holdings in the fund was maintained as close as possible to the maximum of 20% allowed for the fund. Bank deposits were maintained only for the fund. Bank deposits were maintained only for the purpose of liquidity management. To reflect our bearish view on the debt market the duration of the fixed income portfolio, allocation to Gilts was higher than corporate bonds. All the bonds in the portfolio are top rated. The asset composition, the details of the portfolio and the net returns are disclosed below :

Net Returns during last 1 month (Mar.06)

2.47%

Net Returns during the last 3 months (Jan.-Mar.06)

4.07%

Net Returns during the last 12 months (Apr.-Mar.06)

13.83%

Net Returns Since Inception in Feb.03 (Annualized)

13.10%

Asset Allocation

Balanced Fund

20%

22%

53%

5%

Equity

Corporate

Gilts

Bank Deposite

Growth Fund: To take advantage of the bullish trend in the equity market, the equity holdings in the fund was maintained as close as possible to the maximum of 40% allowed for the fund. To reflect our bearish view on the debt market the duration of the fixed income portfolio was kept low.

Asset Allocation

Growth Fund

40%

9%

45%

6%

Equity

Corporate

Gilts

Bank Deposite

Equity Fund : In line with the stated asset allocation pattern and our view of the market , the entire corpus of the fund was invested in equities.

Asset Allocation

Equity Fund

98.93%

1.07%

Equity

MF/BD

CHAPTER : 7

RESEARCH METHODOLOGY

Data Source :

The data would be collected from both primary as well as secondary data. Customers would be asked to fill questionnaires to arrive at the information. Various secondary sources of data as magazines, journal internet etc., would also be explored.

Sampling Area:

I am choosing different areas of Ahmedabad city for the research to be carried out.

Sampling Method :

I am choosing the sample on the convenience Sampling basis. We are choosing respondents who have taken a life insurance.

Sample Size :

I am choosing 50 respondents from different areas of Ahmedabad city.

Research Instrument :

I am choosing questionnaire as a research instrument as this can help me knowing the perception of the people about the life insurance at the least possible cost.

Method of Contact :

The method of contact would be personal and direct as this would help to qualify the customer issues while filling up the questionnaires and also help them if they do not have the knowledge about any insurance plan of the company.

Method of Making an approach for Sales :

Based on the content of the questionnaire we would analyze and identify the needs of a customer. We would later make a phone call to him in order to take an appointment with him so that we could show and explain him an insurance which may fulfill most of his needs.

OBJECTIVES

To know the perception of the consumer about life insurance.

To improve our ability to sell a financial product like life insurance.

To get some good market exposure by dealing with the prospects face to face.

To get a deep knowledge of the financial product like insurance.

To get some information about the market share of Reliance Life Insurance and to know the standing of the company in the market.

DATA COLLECTION AND ANALYSIS

Questionnaire :

Q.1 Do you have Life Insurance Policy ?

Yes

45

No

05

0

10

20

30

40

50

1

Life Insurance

Holder

Yes

No

Analysis : We have selected 50 respondents in which 5 respondent does not have life insurance policy.

Q.2 If Yes which companys insurance policy do you have?

Companys Name

No. of Policies

LIC

25

Reliance Life Insurance

08

HDFC

01

ICICI Prudential

05

Tata AIG

01

New York Max Life

01

OM kotak

01

Met Life insurance

01

Birla sun life

03

Alliance Bajaj

01

Aviva Life insurance

03

0

5

10

15

20

25

30

No. of Policies

LIC

Reliance Life Insurance

HDFC

ICICI Prudential

Tata AIG

New York Max Life

OM kotak

Met Life insurance

Birla sun life

Alliance Bajaj

Aviva Life insurance

Analysis : From the above chart we can easily say that according to my research the LIC of India is the current market leader. The second largest share goes to Reliance Life Insurance being a private company. The Reliance Life Insurance Company has able to snatch some market share of LIC of India. Though LIC of India is the oldest & the biggest Insurance Company in India, but in term of pace of growth and development Reliance Life Insurance is much ahead.

Q.3 What priorities would you consider most important, while purchasing?

Ranks

I

II

III

IV

V

Death Benefit

6

14

9

6

15

Childrens Education

9

8

10

13

10

Retirement Benefit

15

10

11

7

7

Tax Planning

15

7

14

10

4

Financial Planning

5

11

6

14

14

0

5

10

15

20

I

II

III

IV

V

Death Benefit

Childrens

Education

Retirement

Benefit

Tax Planning

Financial

Planning

Analysis : In the above diagram we can make out that the factor getting rank 1 the maximum number of times is Retirement benefit and Tax Planning. The factor getting rank 2 the maximum number of times is come anytime. For rank 3 tax planning has again been given importance but here we would consider childrens education as rank 3 as one factor death benefit. This shows that people dont take life lightly as it seems that they have realized that nothing in life is certain except death that cannot achieve to ranks at the same time. The factor being given rank for by most number of respondents is financial planning.

Q.4 Do you have any knowledge about Unit Linked Insurance plans?

Yes

18

No

32

36%

64%

Yes

No

Analysis : The above figure is shown that about 64% of the respondents dont know anything about ULIP (Unit Linked Insurance Plan) whereas about 36% of the respondents do have knowledge about the ULIP. This shows that people are not aware of new type of insurance plans.

Q.5 Is your current insurance policys Unit Linked or Traditional?

Unit Linked

11

Traditional

31

26%

74%

Unit Linked

Traditional

Analysis: The above figure is a sequel to the previous question. Here about 74% of the respondents have insurance which is Traditional in nature whereas the rest 26% are those who have Unit Linked Insurance Plans with them. It seems that people are not aware of the new insurance plans or shall we say that they are scared of breaking the tradition.

Q.6 Are you or any of your family members planning to buy an insurance plan in near future?

Yes

11

No

39

11

39

Yes

No

Analysis : Here from the data its self we can see that about 39 respondents have no plans of purchasing an insurance plan in the near future. But still they are the prospect for us. We would definitely approach them after analyzing their needs from the questionnaire.

Q.7 Are your needs satisfied with your current investment in insurance?

Yes

35

No

15

35

15

Yes

No

Analysis : This table shows us that out of 50 respondents 35 respondents feel that their needs are satisfied with their current investment in insurance whereas the remaining 15 respondents are not satisfied with their current investment in insurance.

Q. 8 If No. then give reasons.

Factors

No. of Respondents

High Premium

7

Low Return

5

Poor Service

3

0

2

4

6

8

No.of Respondents

High Premium

Low Return

Poor Service

Analysis : From the above diagram we can make out that the reason of 7 respondents being dissatisfied from their current investment in insurance is high premium. Due to high premium it had become difficult for them to continue their policy. As a result of this some of them even had to surrender their policy and the policy of some respondents had lapsed. The other 5 respondents were dissatisfied with their current investment in insurance because of the low returns from the investment. 3 respondent was dissatisfied with his current investment in insurance because of poor service from the company.

Q.9 Do you know anything about Reliance Life Insurance?

Yes

35

No

15

35

15

Yes

No

Analysis : About 35 respondents knew much than we expected about Reliance Life Insurance, whereas 15 respondents knew nothing about Reliance Life Insurance. But overall it shows that in such a short time Reliance Life Insurance has been able to make a good name for itself through aggressive selling and with proper marketing channels. If such aggression is continued then that day is not when Reliance Life Insurance would be the overall market leader.

Q.10 If Yes, from where did you come to know about the company?

Media

Reply of the Respondents

T.V.

05

News Paper

10

Radio

00

Hoardings

10

Internet

10

Magazine

05

Sales Representative

10

0

2

4

6

8

10

Reply of the Respondents

T.V.

News Paper

Radio

Hoardings

Internet

Magazine

Analysis : From the figure above we can say that the most effective to reach the prospects is through Sales Representatives. These are the recruits who can be a an MBA students doing their summer training, graduate student looking for a part time job, etc. This force is really effective in bringing in the prospects notice not only the company but also its products and their benefits. The second most effective instrument is newspaper.

PERSONAL INFORMATION

Q.1 Age Group :

Age Group

No. of Respondents

18-25

0

25-35

7

35-45

15

45-55

26

55-Above

2

Analysis: From the above data we can see that the highest number of respondents fall in the age group of 45 to 55 years. 26 respondents fall in this age group.

The 2nd largest number of respondents falls in the age group of 35 to 45 years. The 3rd largest group has 7 respondents. The age group of this group is 25 to 35 years.

The 4th category goes to people belonging to the age group of 55 and above.

Q.2 Gender :

Male

38

Female

12

Analysis : The above data shows that our respondents include 38 male and 12 female. This shows that the female who are also earning are now taking part in important decisions like investment and insurance.

Q.3 Occupation :

Service

44

Business

6

Analysis : From the above data we can make out that 44 of our respondents include service people as they want to have tax benefit. As far as the business people are concerned they prefer putting the money in the business rather than investing in insurance policies.

CHAPTER : 8

SUGGETIONS

There is a requirement of a branch office to be opened in Gujarat for the convenience of the customer.

The depth of the company in terms of the area is not so impressive. The company needs to enter and create some awareness in rural and semi urban areas where LIC of India is already having a strong hold.

The company must reduce the minimum limit on the premium so that the middle class and lower middle class people can also afford investing in any product of Reliance Life Insurance.

The company should avoid displaying the charges and in the brouchers or reduce the administrative charges.

CHAPTER : 9

CONCLUSION

At last here I have concluded that the Reliance Life Insurance is growing company in very short period Reliance Life Insurance has done very good business as the Reliance Life Insurance has a good brand name.

The all departments of Reliance Life Insurance is very sound the working style of Reliance Life Insurance is systematic and effective for growth the career.

CHAPTER : 10

BIBLIOGRAPHY

1. www.reliancelifeinsurance.co.in

2. www.bimaonline.com

3. www.indiainfoline.com

4. Life First Magazine by Reliance

CHAPTER : 11

ANNEXURE

Questionnaire :

Q.1 Do you have Life Insurance Policy ?

Yes

No

Q.2 If Yes which companys insurance policy do you have?

Companys Name

LIC

Reliance Life Insurance

HDFC

ICICI Prudential

Tata AIG

New York Max Life

OM kotak

Met Life insurance

Birla sun life

Alliance Bajaj

Aviva Life insurance

Q.3 What priorities would you consider most important, while purchasing?

Ranks

Death Benefit

Childrens Education

Retirement Benefit

Tax Planning

Financial Planning

Q.4 Do you have any knowledge about Unit Linked Insurance plans?

Yes

No

Q.5 Is your current insurance policys Unit Linked or Traditional?

Unit Linked

Traditional

Q.6 Are you or any of your family members planning to buy an insurance plan in near future?

Yes

No

Q.7 Are your needs satisfied with your current investment in insurance?

Yes

No

Q. 8 If No. then give reasons.

Factors

High Premium

Low Return

Poor Service

Q.9 Do you know anything about Reliance Life Insurance?

Yes

No

Q.10 If Yes, from where did you come to know about the company?

Media

T.V.

News Paper

Radio

Hoardings

Internet

Magazine

Sales Representative

PERSONAL INFORMATION

Q.1 Age Group :

Age Group

18-25

25-35

35-45

45-55

55-Above

Q.2 Gender :

Male

Female

Q.3 Occupation :

Service

Business

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Yes

No

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T.V.

News Paper

Radio

Hoardings

Internet

Magazine

Sales Representative

5

10

0

10

10

5

10

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