Download Evolution & Key Players in Indian Insurance: Focus on HDFC Standard Life and more Study Guides, Projects, Research Marketing in PDF only on Docsity!
CHAPTER - I
INTRODUCTION
1.1 PREAMBLE:
1.1.1 LIFE INSURANCE:
In 1818 the British established the first insurance company in India in Calcutta, the Oriental Life Insurance Company. First attempts at regulation of the industry were made with the introduction of the Indian Life Assurance Companies Act in 1912. A number of amendments to this Act were made until the Insurance Act was drawn up in 1938. Noteworthy features in the Act were the power given to the Government to collect statistical information about the insured and the high level of protection the Act gave to the public through regulation and control. When the Act was changed in 1950, this meant far reaching changes in the industry. The extra requirements included a statutory requirement of a certain level of equity capital, a ceiling on share holdings in such companies to prevent dominant control to protect the public from any adversarial policies from one single party, stricter control on investments and, generally, much tighter control. In 1956, the market contained 154 Indian and 16 foreign life insurance companies. Business was heavily concentrated in urban areas and targeted the higher echelons of
1
society. Unethical practices adopted by some of the players against the interests of the consumers then led the Indian government to nationalize the industry. In September 1956, nationalization was completed, merging all these companies into the so-called Life Insurance Corporation (LIC). It was felt that “nationalization has lent the industry fairness, solidity, growth and reach.”
Insurance is in a manner of speaking the last frontier in the financial sector to open. It is also a sector, which leads to benefits across the full spectrum, from the individual who now have wider choices, to the economy, which see increased savings, to the infrastructure sector, which can look forward to long term funding being available. In an under-insured economy, newer channels of distribution have to be utilized to intensify the reach of insurance both in urban and rural markets. This will create huge employment opportunities not only within insurance companies but also as agents and consultants of insurance companies.
INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY:
The insurance Regulatory and Development Authority (IRDA) is a national agency of the Government of India, based in Hyderabad. In 1999, the Insurance Regulatory and Development Authority (IRDA) was constituted as an autonomous body to regulate and develop the insurance industry. The IRDA was incorporated as a statutory body in April, 2000.
The key objectives of the IRDA include promotion of competition so as to enhance customer satisfaction through increased consumer choice and lower premiums, while ensuring the financial security of the insurance market. The IRDA opened up the market in August 2000 with the invitation for application for registrations. Foreign companies were allowed ownership of up to 26%. The Authority has the power to frame regulations under Section 114A of the Insurance Act, 1938 and has from 2000 onwards framed various regulations ranging from registration of companies for carrying on insurance business to protection of policyholders’ interests.
2
1.2.1 HDFC STANDARD INSURANCE PARENTAGE:
HDFC LIFE INSURANCE Limited:
- HDFC is India leading housing finance institution and has helped build more than 23, 00,000 houses since its incorporation in 1977.
- In Financial Year 2003-04 its assets under management crossed Rs. 36,000 Cr.
- As at March 31, 2004, outstanding deposits stood at Rs. 7,840 Cr.
- The depositor base now stands at around 1 million depositors.
- Rated AAA by CRISIL and ICRA for the 10th consecutive year
- Stable and experienced management.
- (^) High service standards.
- Awarded The Economic Times Corporate Citizen of the year Award for its long-standing commitment to community development.
- Presented the Dream Home award for the best housing finance Provider in 2004 at the third Annual Outlook Money Awards.
HDFC ERGO GENERAL INSURANCE LIMITED:
- On 19th June 2019 HDFC announced that it has acquired majority stake in Apollo Munich Health Insurance for Rs 1,346.84crore Apollo Munich will be merged with HDFC ERGO General Insurance Company Limited
- In 2015, ERGO bought 23% more stake in the HDFC venture, making them a 49% stakeholder.
- ERGO acquired 26 per cent share, the rest being held by HDFC.
- Awarded the Best General Insurance Company in India by International Alternative Investment Review (IAIR) in 2013 and 2014.
- The firm is a public company and is categorized as Indian non-government Company. The company's authorized share capital is 6,000,000,000 and its paid up capital is 5,386,202,600.
- It received an ISO Certification in 2010.
1.2.2 KEY STRENGHTS:
4
1. FINANCIAL EXPERTISE:
As a joint venture of financial services groups, HDFC standard life has the financial expertise required to manage your long-term investments safely and efficiently.
- RANGE OF SOLUTIONS: We have a range of individual and group solutions, which can be easily customized to specific needs. Our group solutions have been designed to offer you complete flexibility combined with a low charging structure.
3. TRACK RECORD SO FAR:
Our gross premium income, for the year ending March 31, 2008 stood at Rs. 4,859crores and new business premium income stood at Rs. 2,685crores. The company has covered over 9,59,000 lives year ending March 31, 2008.
1.2.3 SWOT ANALYSIS OF HDFC LIFE INSURANCE:
STRENGHTS:
- (^) Domestic image of HDFC supported by Standard Life’s international image is the strength of the company.
- Strong and well spread network of qualified intermediaries and sales person.
- Strong capital and reserve base.
- (^) The company provides customer service of the highest order.
- Huge basket of product range which are suitable for all age and income groups.
- Large pool of technically skilled manpower with in depth knowledge and understanding of the market.
- (^) The company also provides innovative products to cater to different needs of different customers.
WEAKNESS:
- (^) Heavy management expenses and administrative costs.
- Low customer confidence on private players.
5
- Integrity
- Innovation
- Customer centric
- People Care One for all and all for ones
- Teamwork
- Joy and Simplicity
1.3 POLICY DETAILS:
1.3.1 Individual product:
We at HDFC Standard Life realize that not everyone has the same kind of needs. Keeping this in mind, we have a varied range of Products that you can choose from to suit all your needs. These will help secure your future as well as the future of your family.
Protection Plans: You can protect your family against the loss of your income or the burden of a loan in the event of your unfortunate demise, disability or sickness. These plans offer valuable peace of mind at a small price.
- Term Assurance Plan.
- Loan Cover Term.
- Assurance Plan.
Investment Plans: Our investment products are well suited to meet your long-term needs.
- Single Premium Whole Life Plan
Pension Plans: Our Pension Plans help you secure your financial independence even after retirement.
- Personal Pension Plan
- Unit Linked Pension Plan
- Unit Linked Pension Plus
7
Our Immediate Annuity plan will aid you in receiving income post retirement and securing you financial independence.
Savings Plans: Our Savings Plans offer you flexible options to build savings for your future needs such as buying a dream home or fulfilling your children’s immediate and future needs. Our Savings range includes
- Endowment Assurance Plan
- Unit Linked Endowment
- Unit Linked Endowment Plus
- Money Back Plan
- Children's Plan
- (^) Unit Linked Young star
- Unit Linked Young star Plus
Health Plans: Our health plans provides you with timely support in case of any health related emergencies and helps you and your family to remain financially independent in difficult times
- Critical care plan
- Medical care plan
1.3.2 Group Products:
One-stop shop for employee-benefit solutions: HDFC Standard Life has the most comprehensive list of products for progressive employers who wish to provide the best and most innovative employee benefit solutions to their employees. We offer different products for different needs of employers ranging from term insurance plans for pure protection to voluntary plans such as superannuation and leave encashment. We now offer the following group products to our esteemed corporate clients
8
Chapter 2:
Literature Review
Marketing metrics Literature review
10
C. Balaji(2015), in his paper- Customer awareness and satisfaction of life insurance policy holders with reference to Mayiladuthurai town tries to measure awareness among the urban and rural consumer about the insurance sector and also the various policies involving various premium rates. The study was conducted by examining around 100 sample respondents which revealed that 100% of respondents are aware of the life insurance policies; where as 87% of the respondents came to know about insurance policies through agents. But it also came to light that Most of the respondents are aware of government insurance company LIC and in the private sector HDFC Standard Life insurance. Finally the research concludes that the penetration level of insurance in India is only 2.3% when compared to 9-15% in the developed nations. So there is a huge market for the Insurance products in the future in India.
Marketing metrics Literature review
