Insurance

Name of Members:
Insurance
Insurance is a financial service for collecting the savings
of the public and providing them with risk coverage
The main function of the Insurance is to provide
protection against the possible chances of generating
losses.
Origin of Insurance
Babylonians- 6000 years ago – Clearing house of
trade as all the land routes converged in that
territory.
The instance of first life insurance policy is found in
England in the 17th century with the policy of life
of William Gybbons on June 18, 1633 as the first
recorded evidence. The first recorded life office
was the ‘Hand- In – Hand society’ which was
established in 1696.
Indian Origin- Milestones Life Insurance
1818: Orient Life Insurance Company
1912: Indian Life Assurance Companies Act 1928:
Indian Insurance Companies Act
1938: Protecting the interest of the insuring public.
1956: 245 Indian and Foreign insurers and
provident societies – central government and
nationalized.
1999: IRDA (Insurance Regulatory Development
Authority of India)
Indian Origin-Milestones Non Life Insurance
1907: The Indian Mercantile Insurance Ltd.
1957: General Insurance Council
1968: The Insurance Act
1999: Formation of IRDA (Insurance Regulatory
Development Authority of India)
Functions of Insurance
Provide Protection
Collective bearing of risk
Assessment of risk
Provide certainty
Small capital to cover larger
risk
Contributes towards the
development of industries
Means of savings and
investment
 To protect the interests of the
policyholders, to regulate, promote
and ensure orderly growth of the
insurance industry and for matters
connected therewith or incidental
thereto.
Some Function of IRDA

Issue to the applicant a certificate of

registration, renew, modify, withdraw,
suspend or cancel such registration.
Promoting efficiency in the conduct of
insurance business.
Regulating investment of funds by
insurance companies.
Adjudication of disputes between insurers
and intermediaries or insurance
intermediaries.
Supervising the functioning of the Tariff
Advisory Committee.
Kinds of Insurance

1. General Insurance

2. Life Insurance
Reasons for buying insurance products
Passing Away Early
Living too long
Painful Experience
Tax Benefits
Structure of Insurance Industry Snap Shot
Historical Perspective

(i) Prior to 1956 242 companies operating

(ii) 1956 – 2001 Nationalisation LIC monopoly player
Government control
(iii) 2001 -- Opened up sector
Present Structure Of Insurance Industry
(a) LIC – Fully owned by Government
(b) Postal Life Insurance
Private players -
1. Bajaj Allianz Life Insurance Co. Ltd.
2. Birla Sun Life Insurance Co. Ltd.
3. HDFC Standard Life Insurance Co. Ltd.
4. ICICI Prudential Life Insurance Co. Ltd.
5. ING Vysya Life Insurance Co. Ltd.
6. Max New York Life Insurance Co. Ltd.
7. MetLife India Insurance Co. Pvt. Ltd.
8. Kotak Mahindra Old Mutual Life Insurance Co. Ltd.
9. SBI Life Insurance Co. Ltd.
10. TATA AIG Life Insurance Co. Ltd.
11. Aviva Life Insurance Co. Pvt. Ltd.
12. Sahara India Life Insurance Co. Ltd.
13. Shriram Life
14. Future Generali Life Insurance
15. Reliance Life Insurance
16. Bharti Axa Enterprises
17. IDBI Fortis
18. Canara HSBC OBC
INDIAN INSURANCE SECTOR
Company Indian Partner Foreign Partner Area
Birla Sun Life Aditya Birla Group  Sun Life, Canada  Life

Om Kotak Kotak Mahindra Finance Old Mutual, South Africa Life

HDFC-Standard Life HDFC Standard Life, UK Life

Royal Sundaram Sundaram Finance Royal Sun, UK Life and Non-Life

ICICI-Prudential ICICI Prudential, UK Life

Max New York Life Max India New York Life, USA Life

Tata-AIG Tata Group AIG, USA Life and Non-Life

ING Vysya Vysya Bank ING Insurance, Netherlands  Life

MetLife India Jammu & Kashmir Bank MetLife, USA Life

Aviva  Dabur  CGU Life, UK Life

Bajaj Allianz Bajaj Auto Allianz Life & Non-Life

Present Market Share – Quarter 1 Results 2008-09
RANKING INSURER FP
1 LIC Total 7524.56
2 ICICI Prudential Total 1590.27
3 SBI Life Total 1148.67
4 Bajaj Allianz Total 829.24
5 Reliance Life Total 557.33
6 Birla Sunlife Total 501.53
7 Max New York Total 501.16
8 HDFC Standard Total 490.40
9 Tata AIG Total 260.63
10 Kotak Mahindra Old Mutual Total 234.06
11 Met Life Total 180.88
12 Aviva Total 165.33
13 ING Vysya Total 161.95
14 Shriram Life Total 77.53
15 Bharti Axa Life Total 44.83
16 IDBI FORTIS Total 25.62
17 Sahara Life Total 23.34
18 Future Generali Life Total 2.67
19 Canara HSBC OBC 0.20
Graphical Presentation-Pie
1 LIC Total
FP
2 ICICI Prudential Total

3 SBI Life Total

4 Bajaj Allianz Total

5 Reliance Life Total

6 Birla Sunlife Total

7 Max New York Total

8 HDFC Standard Total

9 Tata AIG Total

10 Kotak Mahindra Old

Mutual Total
11 Met Life Total

12 Aviva Total

13 ING Vysya Total

14 Shriram Life Total

15 Bharti Axa Life Total

 CONTRIBUTION TO INDIAN
ECONOMY
 Life Insurance is the only sector which garners long term
savings
 Spread of financial services in rural areas and amongst
socially less privileged
 Long term funds for infrastructure
 Strong positive correlation between development of
capital markets and insurance/pension sector
 Employment generation
 Aggregation of Long Term Savings
Total Assets of Life Insurance Companies
2002 – 2003 2003 – 2004 2004 – 2005
2,80,450 3,52,608 4,23,000

Total Premium generated

2002 – 2003 2003 – 2004 2004 – 2005
57,708 cr 66,278 cr 79000 cr
2005 – 2006 2006 – 2007 2007 – 2008
94,000 cr 1,12,000 cr 1,33,000 cr

Industry is growing @ 23 p.a.

At this growth rate, the future premium income generated will be Life Insurance
funds account for 15% of household savings.
The industry has the potential to increase the share to 30%.
EMPLOYMENT GENERATION
Life insurance industry provides increased
employment opportunities.
Employees in insurance sector as on 31st March,
2005 is around 3.5 lakhs.
No. of agents on 31st March 2008 – 25.59 lakhs
Brokers, corporate agents, training establishments
provide extra employment opportunities.
Many of these openings are in rural sectors.
 Bajaj Allianz Life Insurance Co. Ltd.
Bajaj Allianz - Merger of Bajaj Auto and Allianz AG

Bajaj Auto Ltd

Bajaj Auto Ltd the flagship company of Bajaj Group was incorporated in 1945 as
Bachraj Trading Corporation. Initially it started by assembling two and three
wheelers in collaboration with Piaggio of Italy. After the expiry of the
agreement in 1971 the two and three wheelers acquired the brand name of Bajaj.
The strength of the company lies in its strong brand image and ability to offer
value for money products leveraging on its large-scale operations.
Bajaj is one of India's largest two and three wheeler manufacturer and the fourth
largest manufacturer of two-wheeler in the world, with an annual turnover of
Rs. 42.16 billion .
 Bajaj Allianz Life Insurance Co. Ltd.
Allianz AG

Allianz group was founded in 1890 and is one of the world's leading insurance
companies with over 100 years' experience in insurance and related services. It is
also the largest insurer in Europe.

Allianz group has multi-local structure and presence in over 70 countries. The key
business areas of Allianz group include General Insurance (property,
engineering, marine, motor, casualty and miscellaneous), Reinsurance, Risk
Management, Life & health insurance, Asset Management and Pension Funds
Management. Cornhill Insurance in the United Kingdom, Fireman's Fund in the
United States of America, AGF in France, RAS s.p.a in Italy, MMI in Australia
are some companies under Allianz group. Rated 'AAA' by S&P it has assets over
670 billion DM (Rs. 17,160 billion) under its management with employee
strength of over 1,05,700.
 Bajaj Allianz Life Insurance Co. Ltd.
The Joint Venture

Bajaj Allianz Life Insurance Co. Ltd. company is a joint venture between
Bajaj Auto Limited and Allianz AG.

Characterized by global presence with a local focus and driven by

customer orientation to establish high earnings potential and financial
strength, 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
 Bajaj Allianz Life Insurance Co. Ltd.
 Most Profitable Pvt. Life Insurance Co Rs.63cr (US $ 15.3 MN..) profit for FY 07-08
 Over 2 million (20,79,217) policies in last financial year – highest amongst all Pvt. sector
players and taking the number 1 position.
 Have sold over 5 million policies issued till date.
 Largest distribution network to reach the customers across the country with more than
3.00,000 agents, 900 offices in 840 towns, 200 corporate agents & Bancassurance partners
 Accelerated Growth

Fiscal Year No of policies New Business in FY

sold in FY
2001-2002 (6mths) 21,376 Rs 7 cr.
2002-2003 1,15,965 Rs 69 cr.
2003-2004 1,86,443 Rs 180 cr.
2004-2005 2,88,189 Rs 857 cr.
2005-2006 7,81,685 Rs 2717 cr.
2006-2007 20,79,217 Rs 4270 cr.

 Shareholder capital base of Rs 700 cr.

EMPLOYMENT GENERATION
 

• Life insurance industry provides increased

employment opportunities.
• Employees in insurance sector as on 31st March,
2005 is around 2 lakhs.
• Many agents depend on insurance for their
Livelihood–No. of agents on 31st March 2004 –
15.59 lakhs
•Brokers, corporate agents, training establishments
provide extra employment opportunities.
• Many of these openings are in rural sectors.
7 P’s of BAJAJ ALLIANZ
 Product
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 •Travel Insurance
Travel Companion
•Asset Insurance Student Companion
Home Insurance Pravasi Bharati Bima Yojana
Shop / Showroom: Protection against Travel Asia
Travel Elite
all risks TSwaravel Assist
•Health Insurance des Yatra
Health Guard •Corporate Insurance
Personal Guard Specialty Lines
Hospital Cash oAviation
Critical Illness oMarine Hull Insurance
oProject Insurance
Silver Health oSports & Entertainment Insurance
E-Opinion Your Employees
Star Package oGroup Personal Accident
Health Ensure oGroup Health Guard
Insta Insure oGroup Critical Illness
Sankat Mochan oWorkmen’s Compensation
Family Floater HG oGroup Travel
Tax Gain
Office
oOffice Package
oBurglary
oPlate Glass
oPublic Liability
oFire
oMoney
oD & O Liability
oFidelity Guarantee

Manufacturing Unit
oFire
oBusiness Interruption
oIndustrial All Risk
oWorkmen’s Compensation
oEngineering
oPublic Liability
oProduct Liability
oComposite Public & Product Liability
oFidelity Guarantee
oMarine Insurance

Credit Insurance
 Promotion
• Television
• Radio
• Movies
• Print Media:
• Hoardings
• Newspaper
• Magazines
• Publicity:
• Campus Visits
• Sponsorship
• Sales Promotion:
• Gifts
• Personal Selling:
• Cross-Sale (Selling At Competitors Place)
• Personalized Service
• Telemarketing
 Price:
The price structure is based on the type of policies. The price
variation has to be kept due to intense competition among private
players. Pricing element is very important for Bajaj Allianz as
they want to increase market share. The price of Bajaj Allianz
policies are made as per keeping the customer in mind

The pricing decisions or the decisions related to interest and fee

or commission charged by banks are found instrumental in
motivating or influencing the target market.

The RBI and the IRDA are concerned with regulations. The rate of
interest is regulated by the RBI and other charges are controlled
by IRDA
 PHYSICAL EVIDANCE

• Internet/Web Pages
• Paperwork
• Brochures
• Furnishings
• Business Cards
• Building
• Signage
• Financial Reports
• Tangibles
• Punch Lines
• Employee’s Dress Code
 Process
•Flow of activities
•Standardization
•Customization
•Number of Steps
•Simplicity
•Complexity
•Customer involvements
 Place
3rd Floor, 349 Business Point,
Western Express Highway Road
Andheri(E).

127 Branch all over India

Future Target for 2015 Is 3000 branches

The locations of every corporate offices of Bajaj Allianz is magnificent.

They locate themselves in a  very professional manner. This indicates
their corporate approach towards their work. Work culture is also
conducive to such environment.
 People
•Create an emotional commitment and strong two-way relationship between the
employees and the company.

•To have clear performance expectations and a clear return from the company
(working environment, development, reward, career opportunities etc), which
helps employees to make a connection between their contribution and the
progress made by the company.

•To inspire and empower people to achieve their best and reward them
competitively for their contribution and provide attractive career opportunities.

•To build a learning culture which fosters personal development and professional
mobility and upholds values of professionalism,innovation, pragmatism, team
spirit, integrity.

•To respect and value individuals, their diversity and support them in their need
to balance professional and personal lives.