SUMMER TRAINNING PROJECT ON RECRUITMENT FINANCIAL ADVISORS OF
A report submitted to Del i busi!ess S" ool# Ne$ Del i As % p%rt &ul&illme!t o& M'A(Post Gr%du%te Pro)r%m *I!dustr+ I!te)r%ted, i! E!trepre!eurs ip - 'usi!ess S%bmitted to. Director Academics Delhi Business School New Delhi Submitted b+. XXXXX XXXX XXXX Ist sem. P. T. U.
I!ter!%l Guide. Ms. XXXXX Delhi Business School New Delhi
DEL/I 'USINESS SC/OOL B-II/5 ! M.".I.#.! Mathura $oad! New Delhi %e&site' www.d&s.edu.in
CONTENTS
? ?
Ac(nowled)ement Introduction ? ? ? ? ? Pre*ace "om+an, Pro*ile #-ecuti.e Summar, Products and Policies Product +ort*olio
? ? ? ? ? ? ? ?
Introduction o* channel de.elo+ment and recruitment Methodolo), used to recruit ad.isor S%/T Anal,sis 0uture )rowth +ros+ects "om+etiti.e anal,sis $ecommendations 1earnin)s Bi&lio)ra+h,
2
AC0NO1LEDGEMENT
I am than(*ul to mana)ement o* $eliance 1i*e Insuranceli*e insurance com+an, limited *or )rantin) the +ermissions! cor+oration and .alua&le in*ormation *or +re+aration o* this +ro3ect. No words are enou)h to than( Mr. XXXXX 4Unit Mana)er5! who not onl, ins+ired me to wor( on this +ro3ect &ut also )uide me to +re+are it. In s+ite o* hea., res+onsi&ilities and &us, schedule! he alwa,s mana)ed time to +ro.ide +ro+er )uidance.
I also than(*ul to Ms. XXXXXX 4Institute Mentor5! who )uide! encoura)e and hel+ me to do this +ro3ect. 1ast &ut not the least6 I would li(e to sa, that all m, *riends and well-wishers *or )i.in) me constant su++ort and .alua&le su))estions to translate m, ideas into realit,.
XXXXXX
7
DECLERATION
I! 22222 student o* Delhi Business School 8an 299 -:9 &atch. ;ere&, I declare that the +ro3ect titled 3RECRUITMENT FINANCIAL ADVISIORS4 is a &ona*ide wor( and is neither su&mitted to Del i 'usi!ess S" ool at an, +oint o* time nor to an, other uni.ersit, or institution *or *ul*illment o* the course o* stud,.
2222222
<
E5e"uti6e Summ%r+
Identi*,in) di**erent +ro*iles o* the +eo+le and )i.in) them an additional source o* income to 3oin $eliance 1i*e Insuranceas an 0inancial Ad.isor. A mar(et sur.e, was done on li*e insurance com+anies. Di**erent =uestions re)ardin) the com+anies trainin) +ro)ram *or ad.isor! to+ 5us+>s! trainin) centers etc. were as(ed. The areas co.ered u+ in this sur.e, were Badar+ur and 1a(shmina)ar. The re+ort contains details o* di**erent li*e insurance com+anies! which are in health, com+etition o* $eliance 1i*e Insuranceli*e insurance. In toda,>s era! the insurance industr, is one o* the most &oomin) sectors. India itsel* has +o+ulation o* :-:2 &illion out o* which rou)hl, 77.2 ? +eo+le are insured. This clearl, shows that most o* the +eo+le are note insured 3ust &ecause the, 3ust don>t (now much a&out insurance. Most +eo+le ha.e some common =ueries a&out li*e insurance.
5
1 %t is li&e i!sur%!"e7
A +olic, that will +a, a s+eci*ied sum o* &ene*iciaries u+on the death o* insured +erson. An a)reement that )uarantees the +a,ment o* stated amount monetar, &ene*its u+on the death o* the insured +erson.
1 + i!sur%!"e7
Insurance is the +rotection o* li*e and assets a)ainst un*oreseen circumstances. %hether it is )eneral accident +olic,! a Mediclaim +olic, or a +ension +olic,! an insurance +olic, hel+s ,ou to sco+e with uncertaint, and insecurit,. #.er thou)h a&out wh, ,ou should ta(e an insurance +olic,. 0or one! it hel+s ,ou to hed)e ris(s a)ainst un*oreseen circumstances and sa.e more. It that>s not all! it is' ? Su+erior to an ordinar, sa.in)s +lan as it +ro.ides *ull +rotection a)ainst the ris( o* death.
?
#ncoura)es and *orces com+ulsor, sa.in)s unli(e other sa.in)s instruments! wherein the sa.ed mone, can &e easil, withdrawn. Pro.ides loan to tie o.er a tem+orar, di**icult +hase and is also acce+ta&le as securit, *or a commercial loan.
?
@
? ? ?
/**ers ta- relie* to +olic,holder. ;ed)es ris( a)ainst uncertaint,. 0or a +olic, ta(en under the M%P Act : As Pro+ert, Act5! a trust is created *or wi*e and children as &ene*iciaries. Based on the conce+t o* sharin) o* losses! the societ, will &ene*it as catastro+hic losses are s+read )lo&all,.
?
1 o "%! bu+ % li&e i!sur%!"e poli"+7
An, +erson a&o.e : ,ears o* a)e! who is eli)i&le to enter into a .alid contract! can )o *or an insurance +olic,. Su&3ect to certain conditions! a +olic, can &e ta(en on the li*e o* a s+ouse or children.
/o$ is % li&e i!sur%!"e poli"+ use&ul7
Plannin) *or the *inancial conse=uences o* a +remature death is an essential +art o* e.er, *inancial +lan. Benerall,! the conse=uences are sim+l, too lar)e to i)nore and cannot &e totall, co.ered with ,our own resources. 1i*e insurance is nothin) &ut contract with an insurance com+an, under which is insured 4+urchaser5 +a,s a +remium in e-chan)e *or co.era)e o* s+eci*ied issues. 1i*e insurance is +rotectin) ,our *amil, a)ainst the ris( o* +remature death o* ,ou 4or ,our s+ouse5. 1i*e insurance +lannin) should consider ,our *amil,>s short term needs 4*or e-am+le! medical e-+enses5 and lon)-term needs 4*or e-am+le! re+lacin) ,our income5! In course o* our li*e w are accosted &, ris(-that o* *ailin) health! *inancial losses! accidents and so on. Insurance is mean &, which li*e>s uncertainties are addressed in *inancial terms. It o**ers a monetar, com+ensation a)ainst those losses. Insurance is
A
considered more as a hed)in) mechanism rather than a true in.estment a.enue. 1i*e insurance! in +articular is essentiall, ac(nowled)ed as mechanism that eliminates ris(su&stitutin) certaint, *or uncertaint, +rimaril, &, trans*errin) ris( *rom the insured to the insurer.
Is li&e i!sur%!"e is % s%6i!) i!strume!t7
1i*e insurance is mainl, considered as a sa.in) instrument rather than an in.estment a.enue as it +romotes com+ulsor, sa.in)s &esides reducin) ta- &urden on the +olic,holder and +rotects the *amil, o* +olic,holder in the e.ent o* un*oreseen ha++enin). It is the onl, sa.in) instrument! which co.ers ris( &esides )i.in) taconcession &oth at entr, 4+remium +aid5 and e-it +oint. The section :94D5 o* the income ta- act totall, e-em+ts +a,ment o* ta- on an, amount recei.ed as &onus a)ainst li*e insurances +olicies.
T+pes o& I!sur%!"e Pl%!s Tr%ditio!%l or U!it Li!8ed
Broadl,! insurance +lans can &e distinctl, di.ided into U1IPs and traditional +lans. A &rie* detail o* &oth se)ments'
U!it Li!8ed I!sur%!"e Produ"t.
U1IPs ha.e )ained hi)h acce+tance due to attracti.e *eatures the, o**er. These include'
? ? ? ?
0le-i&ilit, 0le-i&ilit, to choose Sum Assured. 0le-i&ilit, to choose +remium amount. /+tion to chan)e le.el o* Premium /Sum Assured e.en a*ter the +lan has started.
C
? ? ? ? ? ? ? ? ? ? ?
0le-i&ilit, to chan)e asset allocation &, switchin) &etween *unds Trans+arenc, "har)es in the +lan D net amount in.ested are (nown to the customer "on.enience o* trac(in) one>s in.estment +er*ormance on a dail, &asis. 1i=uidit, /+tion to withdraw mone, a*ter *ew ,ears 4com*ort re=uired in case o* e-i)enc,5 1ow minimum tenure. Partial / S,stematic withdrawal allowed 0und /+tions A choice o* *unds 4ran)in) *rom e=uit,! de&t! cash or a com&ination5 /+tion to choose ,our *und mi- &ased on desired asset allocation
Tr%ditio!%l Pl%!s:
:9
These are the oldest t,+es o* +lans a.aila&le. These +lans cater to customers with a low ris( a++etite. Some o* the common *eatures o* traditional +lans are'
? ? ? ? ? ? ? ?
Stead, In.estment Ma3or chun( o* in.esti&le *unds are in de&t instruments Stead, and almost assured returns o.er the lon) term 0eatures Death &ene*it is Sum Assured E )uaranteed D .ested &onus ;el+s in asset creation as the, are *or a lon) tenure Premium to Sum Assured ratios are *i-ed *or each +lan and a)e. Benerall, withdrawals are not allowed &e*ore maturit,
::
T%5 'e!e&its o! I!sur%!"e %!d Pe!sio!
1i*e insurance and retirement +lans are e**ecti.e wa,s o* sa.in) ta-es. The ta- &rea(s that are a.aila&le under our .arious insurance and +ension +olicies are descri&ed &elow' :. 1i*e insurance +lans o* $eliance 1i*e Insurance are eli)i&le *or deduction under Sec. 9".
2. Pension +lans o* $eliance 1i*e Insuranceare eli)i&le *or a deduction under Sec. 9""".
7. ;ealth insurance +lans/riders o* $eliance 1i*e Insuranceare eli)i&le *or deduction under Sec. 9D.
s dream o* &rin)in) a&out a di)ital re.olution that will +ro.ide e.er, Indian with a**orda&le means o* communication and a read, access to in*ormation. The com+an, &e)an o+erations in :CCC and has o.er 29 million su&scri&ers toda,. It o**ers a com+lete ran)e o* inte)rated telecom ser.ices. These include mo&ile and *i-ed line tele+hon,6 &road&and! national and international lon) distance ser.ices! data ser.ices and a wide ran)e o* .alue added ser.ices and a++lications aimed at enhancin) the +roducti.it, o* enter+rises and indi.iduals. • Reli%!"e E!er)+ Limited
2:
$eliance #ner), 1imited! incor+orated in :C2C! is a *ull, inte)rated utilit, en)a)ed in the )eneration! transmission and distri&ution o* electricit,. It ran(s amon) India>s to+ listed +ri.ate com+anies on all ma3or *inancial +arameters! includin) assets! sales! +ro*its and mar(et ca+italiHation. It is India>s *oremost +ri.ate sector utilit, with a))re)ate estimated re.enues o* $s C!599 crore 4USG 2.: &illion5 and total assets o* $s :9!A99 crore 4USG 2.< &illion5. $eliance #ner), 1imited distri&utes more than 2: &illion units o* electricit, to o.er 25 million consumers in Mum&ai! Delhi! /rissa and Boa! across an area that s+ans :!2s dream o* &rin)in) a&out a di)ital re.olution that will +ro.ide e.er, Indian with a**orda&le means o* communication and a read, access to in*ormation. The com+an, &e)an o+erations in :CCC and has o.er 29 million su&scri&ers toda,. It o**ers a com+lete ran)e o* inte)rated telecom ser.ices. These
2<
include mo&ile and *i-ed line tele+hon,6 &road&and! national and international lon) distance ser.ices! data ser.ices and a wide ran)e o* .alue added ser.ices and a++lications aimed at enhancin) the +roducti.it, o* enter+rises and indi.iduals. • Reli%!"e E!er)+ Limited $eliance #ner), 1imited! incor+orated in :C2C! is a *ull, inte)rated utilit, en)a)ed in the )eneration! transmission and distri&ution o* electricit,. It ran(s amon) India>s to+ listed +ri.ate com+anies on all ma3or *inancial +arameters! includin) assets! sales! +ro*its and mar(et ca+italiHation. It is India>s *oremost +ri.ate sector utilit, with a))re)ate estimated re.enues o* $s C!599 crore 4USG 2.: &illion5 and total assets o* $s :9!A99 crore 4USG 2.< &illion5. $eliance #ner), 1imited distri&utes more than 2: &illion units o* electricit, to o.er 25 million consumers in Mum&ai! Delhi! /rissa and Boa! across an area that s+ans :!2= A""ide!t - de%t be!e&it riders=
INTRODUCTION TO C/ANNEL DEVELOPMENT AND RECRUITMENT
1 o is %! i!sur%!"e %d6isor7
An a)ent is the re+resentati.e o* an insurance com+an, who sells di**erent +olicies or +roduct to its clients. Another term used *or insurance a)ents is %d6isorsG $eliance 1i*e Insuranceli*e insurance com+an, 1td introduced this term. Toda, in li*e insurance com+anies> ad.isors are (nown to &e the &ac(&one o* the whole s,stem. Ad.isors/a)ents do not wor( on monthl, +a,roll &asis6 the, recei.e a certain commission on the +olicies the, sell to the clients. The eli)i&ilit, re=uired to &ecome an ad.isor/a)ent is that he/she should &e :2th +ass to o+erate in ur&an area and :9th +ass *or rural areas. Be*ore a +erson &ecomes an ad.isor/a)ent he/she has to under)o :99hrs trainin) accordin) to I$DA norms! which is com+ulsor,. A +erson who wants to &e an ad.isor has *irst to *ill a recruitment *orm and has to +a, a *ee o* $s. :599/- in *a.or o* I"I"I Prudential. Then! he has to +ass a test! which is com+iled &, I$DA. A*ter he )ets throu)h that test he is awarded a license and then his trainin) starts in the com+an, re)ardin) the insurance &usiness. I"I"I Pru +ro.ides this trainin) in 7 modes as +er the suita&ilit, o* the ad.isors .iH':5 "lassroom trainin)' - it is a Full Time Training with a +eriod o* :A da,s re)ular &etween C am to 5+m at the trainin) centers allotted to the ad.isor. 25 /nline trainin)' - it is another mode o* trainin) where the com+an, +ro.ides "D>S and &oo(s to the ad.isor *or his own stud,.
57
75 "lassroom trainin)' - it is a Part Time Training with a +eriod o* 7@ da,s.
Ad6isor Role.
To +ro.ide on)oin) *inancial ad.ice *or his/her clients'
? ? ? ? ? ? ?
Identi*, *uture clients Ma(in) a++ointments "onduct *inancial re.iew meetin)s with +ros+ects/clients. "lose sales Bet re*errals Pro.ide ser.ice to clients. 0ollows internal sales and re+ortin) s,stem.
1or8i!) E!6iro!me!t o& %! %d6isorH%)e!t=
? ? ? ? ? ?
To &e a +art o* world-class sales team. %or( *rom ,our own o**ice or residence. %or( *ull time or +art time 4an ad.isor can wor( +art time &, under)oin) onl, 59hrs o* trainin) and :99hrs trainin) is *or *ull time ad.isors.5 #arn "ommission! Bonus D Incenti.es. No u++er limits on earnin)s. 0le-i&le career.
Opportu!ities &or %! Ad6isorH%)e!t
? ?
No startu+ ca+ital re=uired. 0le-i&le wor(in) en.ironment.
5<
? ? ?
Be ,our own &oss. Unlimited earnin) +otential. To &e a +art o* a world-class team.
Commissio! Stru"ture=
Di**erent +roducts will ha.e di**erent commission structures. 0or e-am+le' Sin)le Premium +roducts will ha.e a commission o* 2?. $enewal "ommission is +aid at the *ollowin) rates'
?
2nd ,r' A.5? 7rd ,r' A.5? s M $>s Doctors Teachers L$S holders Ad.isors o* other insurance com+anies Post o**ice a)ents Businessmen Accountants /I in an or)aniHation
/o$ does %! %d6isorH%)e!t $or87
?
0irstl, an ad.isor/a)ent has to ma(e a list o* :99 +eo+le that he/she (nows. Then the ad.isor/a)ent ma(es a call to these clients and tries to *i- an a++ointment.
?
5@
?
%hen an a++ointment is *i-ed! the ad.isor/a)ent meets the customer D tries to sell the +roduct. A*ter that the ad.iso/a)ent as(s *or re*erence o* ma-imum num&er o* +eo+le *rom the client. The re*erence is as(ed in conte-t to ma(e *uture calls and whole +rocedure is re+eated a)ain.
?
?
5A
I!sur%!"e %d6isor+ sur6e+
Ge!der o& t e respo!de!t
Gender of the respondants Male Female 40 10
5
Fem al Male
I!&ere!"e.
As we can see *rom the *i)ure itsel* that there is a se- ratio di**erence &etween males and *emales! s +erce+tion o* their &rand in the mar(et and .ia this increasin) their ad.isor &ase &, encashin) on their &rand name.
C, ;ence! our sales +itch in recruitin) the )ood +ro*ile ad.isor was &ased on'
?
Mo!e+.
0or those who are need,! )reed, and s+eed, ? ? #-cellent &ac( end su++ort! attracti.e +a,ments and &ene*its and #-tensi.e trainin) *or that ed)e o.er com+etition
?
Re$%rd %!d Re"o)!itio!
0or those who want to &e reco)niHed and honored
?
Se.eral +ro)rams includin) *orei)n tri+s! seminars etc.
@7
?
Selected clu& mem&ershi+s li(e +resident>s clu&! I"I"I Pru Star "lu&! MD$T clu& etc. Achie.ements rewarded with tro+hies and certi*icates as well with Point rewards to )i.e ,ou a *l,in) start.
?
?
C%rrier Prospe"ts
0or +eo+le who want to clim& the success ladder *ast. Pro)rams li(e PINNA"1#! AB#N"M ";AMPI/N and TIB#$ T#AM has &een de.ised. This whole strate), was &ased on the MAS1/%Qs T;#/$M /0 N##DS.
?
>, Then! instead o* )oin) +ersonall, and meetin) these alresd, well-esta&lished
Ad.isors! we tried the conce+t o* holdin) B/P 4 Business /++ortunit, +resentation5.
?
0or this we dra*ted an in.itation! which was a )immic( so as to entice these ad.isors into comin) to our own o**ice! and it was &ased on the +rete-t o* /N# MI1I/N P/1I"M "#1#B$ATI/NS! the tar)et that I"I"I P$U has 3ust achie.ed.
?
And result was )ood in the sense that we were a&le to con.ert 5 to :9 ad.isors *or our com+an, then and there onl,.
@<
D, Then! we tar)eted hi)h +ro*ile +eo+le li(e "A>s or MBA>s or )o.t.Peo+le.
0or that! we dra*ted a letter in which we 3ust )a.e them a han) o* what our +ro+osal was *or them 4*or recruitin) them as our ad.isors5 and as(ed them to contact us themsel.es i* the, are interested. %e )ot at least :9-:5 calls o* +eo+le who were interested and wanted to &ecome our ad.isors. Meetin)s were held with them and the, were con.erted. The B/P letter and then in.itation *or the B/P i.e. Business /++ortunit, +resentation has &een attached at the end in the anne-ure.
@5
@@
S1OT ANAL9SIS Stre!)t
?
V%st u!t%pped m%r8et.
In a countr, o* : &illion +eo+le there is a hu)e +otential mar(et *or li*e insurance +roducts. In India the +enetration o* the insurance sector in the rural and semi-ur&an areas is low. There is a mar(et o* C99 million *or li*e insurance and 299 million *or householder>s insurance +olic,. In addition to this the a**luent section can &e ta++ed *or /.erseas Mediclaim and Tra.el Insurance +olicies.
?
/u)e pool o& s8illed pro&essio!%ls.
%hether it is &an(s or insurance com+anies! there is no dearth o* s(illed +ro*essionals in India to carr, out a success*ul &anc assurance .enture.
1e%8!ess.
?
L%"8 o& !et$or8i!) %mo!) b%!8 br%!" es
In s+ite o* )rowin) em+hasis on total &ranch mechaniHation 4TBM5 and *ull com+uteriHation o* &an( &ranches! the rural and semi-ur&an &an(s ha.e still to see in*ormation technolo), as an ena&ler. "om+lete inte)ration o* &ranch networ( in.ol.es hu)e in.estments *or creation IT and communication in*rastructure.
@A
?
Lo$ s%6i!)s r%te
Thou)h we ha.e a hu)e mar(et *or insurance +olicies! the middle class who constitutes the &ul( o* this mar(et is toda, &urdened under in*lationar, +ressures. The secret lies in includin) sa.in)s ha&it &ut considerin) the amount o* sur+lus *unds a.aila&le with the middle class *or in.estin) in *uture securit,! the a&ilit, to sa.e is .er, nominal.
Opportu!ities.
?
D%t% mi!i!).
Ban(s ha.e a hu)e customer data&ase which has to &e +ro+erl, le.era)ed. Tar)et se)ments should &e identi*ied and ta++ed.
? ?
%ide distri&ution networ(s o* &an(s +ro.ides a )reat o++ortunit, to sell insurance +roducts throu)h &an(s
Another +otential area o* )rowth o* &anc assurance is e-+loitin) the cor+orate customers and t,in) u+ *or insurance o* the em+lo,ees o* cor+orate clients.
T re%ts.
@
?
;uman $esource "hallen)es
Success in &anc assurance .enture re=uires a chan)e in mindset. Thou)h we ha.e a lar)e talent +ool! the ina&ilit, to sell com+le- insurance +roducts on the +art o* &an( +ro*essionals and their reluctance to learn can &e se.ere set&ac(. There has to &e a chan)e in the thin(in)! a++roach and wor( culture.
?
Non-res+onse *rom the tar)et )rou+s can also +ose a challen)e as it ha++ened in the USA in :C 9s
@C
A9
FUTURE GRO1T/ PROSPECTS OF COMPAN9
In the total mar(et share! 1I" has reduced its share *rom C:? to A9?. This means that +ri.ate insurance +la,ers ha.e )ot more mar)ins in their hands which ha.e increased *rom C? to 79? in last 2,ears onl,.
In the +ri.ate mar(et share! I"I"I P$U leads with 7C? o* the mar(et share in its hand *ollowed &, Ba3a3 AllianH with : ? shares and then comes BirlaSun 1i*e with :5? mar(et shares.
I"I"I P$U has &een maintainin) its N/ : +osition since last 5 ,ears &ecause o* its +roli*ic +roduct ran)e and commandin) &rand e=uit,. It has a hi)hest ca+ital &ase o* $s. C25 crores and a team o* more than 5@!799 wee(-trained ad.isors. It en3o,s a &rand recall rate o* C2? and )i.es credit o* its success to the 5 core .alues-
? ? ? ? ?
Inte)rit, "ustomer Boundar, 1ess /wnershi+ Passion
A:
COPETITIVE ANAL9SIS 1IT/ /DFCs lar)est housin) *inance +ro.ider! ;D0" and #uro+e>s lar)est mutual li*e assurance The Standard 1i*e Assurance "om+an, 4U. K5. Standard 1i*e! UK! *ounded in : 25! has &een at the *ore*ront o* the UK insurance industr, *or :A5 Mears &, com&inin) sound *inancial 3ud)ment with inte)rit, and relia&ilit,. It is the L%r)est Mutu%l Li&e "omp%!+ i! Europe and has total assets o* $s. 5!59!999 crore.
Tr%i!i!) %"ti6ities &or %)e!tsH%d6isors.
? ? ? ?
As +er I$DA )uidelines! :99hrs trainin) is com+ulsor,. Both online D classroom trainin) are a.aila&le. Trainin) is com+ulsor, with &oth +art-time D*ull time /+tions. A clear e-am is conducted &, I$DA! the minimum Ruali*ication re=uired is-
A2
:2th +ass *or ur&an areas :9th +ass *or rural areas.
Commissio! Stru"ture.
De+ends on the +roduct! li(e on sa.in)s 29-
A report submitted to Del i busi!ess S" ool# Ne$ Del i As % p%rt &ul&illme!t o& M'A(Post Gr%du%te Pro)r%m *I!dustr+ I!te)r%ted, i! E!trepre!eurs ip - 'usi!ess S%bmitted to. Director Academics Delhi Business School New Delhi Submitted b+. XXXXX XXXX XXXX Ist sem. P. T. U.
I!ter!%l Guide. Ms. XXXXX Delhi Business School New Delhi
DEL/I 'USINESS SC/OOL B-II/5 ! M.".I.#.! Mathura $oad! New Delhi %e&site' www.d&s.edu.in
CONTENTS
? ?
Ac(nowled)ement Introduction ? ? ? ? ? Pre*ace "om+an, Pro*ile #-ecuti.e Summar, Products and Policies Product +ort*olio
? ? ? ? ? ? ? ?
Introduction o* channel de.elo+ment and recruitment Methodolo), used to recruit ad.isor S%/T Anal,sis 0uture )rowth +ros+ects "om+etiti.e anal,sis $ecommendations 1earnin)s Bi&lio)ra+h,
2
AC0NO1LEDGEMENT
I am than(*ul to mana)ement o* $eliance 1i*e Insuranceli*e insurance com+an, limited *or )rantin) the +ermissions! cor+oration and .alua&le in*ormation *or +re+aration o* this +ro3ect. No words are enou)h to than( Mr. XXXXX 4Unit Mana)er5! who not onl, ins+ired me to wor( on this +ro3ect &ut also )uide me to +re+are it. In s+ite o* hea., res+onsi&ilities and &us, schedule! he alwa,s mana)ed time to +ro.ide +ro+er )uidance.
I also than(*ul to Ms. XXXXXX 4Institute Mentor5! who )uide! encoura)e and hel+ me to do this +ro3ect. 1ast &ut not the least6 I would li(e to sa, that all m, *riends and well-wishers *or )i.in) me constant su++ort and .alua&le su))estions to translate m, ideas into realit,.
XXXXXX
7
DECLERATION
I! 22222 student o* Delhi Business School 8an 299 -:9 &atch. ;ere&, I declare that the +ro3ect titled 3RECRUITMENT FINANCIAL ADVISIORS4 is a &ona*ide wor( and is neither su&mitted to Del i 'usi!ess S" ool at an, +oint o* time nor to an, other uni.ersit, or institution *or *ul*illment o* the course o* stud,.
2222222
<
E5e"uti6e Summ%r+
Identi*,in) di**erent +ro*iles o* the +eo+le and )i.in) them an additional source o* income to 3oin $eliance 1i*e Insuranceas an 0inancial Ad.isor. A mar(et sur.e, was done on li*e insurance com+anies. Di**erent =uestions re)ardin) the com+anies trainin) +ro)ram *or ad.isor! to+ 5us+>s! trainin) centers etc. were as(ed. The areas co.ered u+ in this sur.e, were Badar+ur and 1a(shmina)ar. The re+ort contains details o* di**erent li*e insurance com+anies! which are in health, com+etition o* $eliance 1i*e Insuranceli*e insurance. In toda,>s era! the insurance industr, is one o* the most &oomin) sectors. India itsel* has +o+ulation o* :-:2 &illion out o* which rou)hl, 77.2 ? +eo+le are insured. This clearl, shows that most o* the +eo+le are note insured 3ust &ecause the, 3ust don>t (now much a&out insurance. Most +eo+le ha.e some common =ueries a&out li*e insurance.
5
1 %t is li&e i!sur%!"e7
A +olic, that will +a, a s+eci*ied sum o* &ene*iciaries u+on the death o* insured +erson. An a)reement that )uarantees the +a,ment o* stated amount monetar, &ene*its u+on the death o* the insured +erson.
1 + i!sur%!"e7
Insurance is the +rotection o* li*e and assets a)ainst un*oreseen circumstances. %hether it is )eneral accident +olic,! a Mediclaim +olic, or a +ension +olic,! an insurance +olic, hel+s ,ou to sco+e with uncertaint, and insecurit,. #.er thou)h a&out wh, ,ou should ta(e an insurance +olic,. 0or one! it hel+s ,ou to hed)e ris(s a)ainst un*oreseen circumstances and sa.e more. It that>s not all! it is' ? Su+erior to an ordinar, sa.in)s +lan as it +ro.ides *ull +rotection a)ainst the ris( o* death.
?
#ncoura)es and *orces com+ulsor, sa.in)s unli(e other sa.in)s instruments! wherein the sa.ed mone, can &e easil, withdrawn. Pro.ides loan to tie o.er a tem+orar, di**icult +hase and is also acce+ta&le as securit, *or a commercial loan.
?
@
? ? ?
/**ers ta- relie* to +olic,holder. ;ed)es ris( a)ainst uncertaint,. 0or a +olic, ta(en under the M%P Act : As Pro+ert, Act5! a trust is created *or wi*e and children as &ene*iciaries. Based on the conce+t o* sharin) o* losses! the societ, will &ene*it as catastro+hic losses are s+read )lo&all,.
?
1 o "%! bu+ % li&e i!sur%!"e poli"+7
An, +erson a&o.e : ,ears o* a)e! who is eli)i&le to enter into a .alid contract! can )o *or an insurance +olic,. Su&3ect to certain conditions! a +olic, can &e ta(en on the li*e o* a s+ouse or children.
/o$ is % li&e i!sur%!"e poli"+ use&ul7
Plannin) *or the *inancial conse=uences o* a +remature death is an essential +art o* e.er, *inancial +lan. Benerall,! the conse=uences are sim+l, too lar)e to i)nore and cannot &e totall, co.ered with ,our own resources. 1i*e insurance is nothin) &ut contract with an insurance com+an, under which is insured 4+urchaser5 +a,s a +remium in e-chan)e *or co.era)e o* s+eci*ied issues. 1i*e insurance is +rotectin) ,our *amil, a)ainst the ris( o* +remature death o* ,ou 4or ,our s+ouse5. 1i*e insurance +lannin) should consider ,our *amil,>s short term needs 4*or e-am+le! medical e-+enses5 and lon)-term needs 4*or e-am+le! re+lacin) ,our income5! In course o* our li*e w are accosted &, ris(-that o* *ailin) health! *inancial losses! accidents and so on. Insurance is mean &, which li*e>s uncertainties are addressed in *inancial terms. It o**ers a monetar, com+ensation a)ainst those losses. Insurance is
A
considered more as a hed)in) mechanism rather than a true in.estment a.enue. 1i*e insurance! in +articular is essentiall, ac(nowled)ed as mechanism that eliminates ris(su&stitutin) certaint, *or uncertaint, +rimaril, &, trans*errin) ris( *rom the insured to the insurer.
Is li&e i!sur%!"e is % s%6i!) i!strume!t7
1i*e insurance is mainl, considered as a sa.in) instrument rather than an in.estment a.enue as it +romotes com+ulsor, sa.in)s &esides reducin) ta- &urden on the +olic,holder and +rotects the *amil, o* +olic,holder in the e.ent o* un*oreseen ha++enin). It is the onl, sa.in) instrument! which co.ers ris( &esides )i.in) taconcession &oth at entr, 4+remium +aid5 and e-it +oint. The section :94D5 o* the income ta- act totall, e-em+ts +a,ment o* ta- on an, amount recei.ed as &onus a)ainst li*e insurances +olicies.
T+pes o& I!sur%!"e Pl%!s Tr%ditio!%l or U!it Li!8ed
Broadl,! insurance +lans can &e distinctl, di.ided into U1IPs and traditional +lans. A &rie* detail o* &oth se)ments'
U!it Li!8ed I!sur%!"e Produ"t.
U1IPs ha.e )ained hi)h acce+tance due to attracti.e *eatures the, o**er. These include'
? ? ? ?
0le-i&ilit, 0le-i&ilit, to choose Sum Assured. 0le-i&ilit, to choose +remium amount. /+tion to chan)e le.el o* Premium /Sum Assured e.en a*ter the +lan has started.
C
? ? ? ? ? ? ? ? ? ? ?
0le-i&ilit, to chan)e asset allocation &, switchin) &etween *unds Trans+arenc, "har)es in the +lan D net amount in.ested are (nown to the customer "on.enience o* trac(in) one>s in.estment +er*ormance on a dail, &asis. 1i=uidit, /+tion to withdraw mone, a*ter *ew ,ears 4com*ort re=uired in case o* e-i)enc,5 1ow minimum tenure. Partial / S,stematic withdrawal allowed 0und /+tions A choice o* *unds 4ran)in) *rom e=uit,! de&t! cash or a com&ination5 /+tion to choose ,our *und mi- &ased on desired asset allocation
Tr%ditio!%l Pl%!s:
:9
These are the oldest t,+es o* +lans a.aila&le. These +lans cater to customers with a low ris( a++etite. Some o* the common *eatures o* traditional +lans are'
? ? ? ? ? ? ? ?
Stead, In.estment Ma3or chun( o* in.esti&le *unds are in de&t instruments Stead, and almost assured returns o.er the lon) term 0eatures Death &ene*it is Sum Assured E )uaranteed D .ested &onus ;el+s in asset creation as the, are *or a lon) tenure Premium to Sum Assured ratios are *i-ed *or each +lan and a)e. Benerall, withdrawals are not allowed &e*ore maturit,
::
T%5 'e!e&its o! I!sur%!"e %!d Pe!sio!
1i*e insurance and retirement +lans are e**ecti.e wa,s o* sa.in) ta-es. The ta- &rea(s that are a.aila&le under our .arious insurance and +ension +olicies are descri&ed &elow' :. 1i*e insurance +lans o* $eliance 1i*e Insurance are eli)i&le *or deduction under Sec. 9".
2. Pension +lans o* $eliance 1i*e Insuranceare eli)i&le *or a deduction under Sec. 9""".
7. ;ealth insurance +lans/riders o* $eliance 1i*e Insuranceare eli)i&le *or deduction under Sec. 9D.
s dream o* &rin)in) a&out a di)ital re.olution that will +ro.ide e.er, Indian with a**orda&le means o* communication and a read, access to in*ormation. The com+an, &e)an o+erations in :CCC and has o.er 29 million su&scri&ers toda,. It o**ers a com+lete ran)e o* inte)rated telecom ser.ices. These include mo&ile and *i-ed line tele+hon,6 &road&and! national and international lon) distance ser.ices! data ser.ices and a wide ran)e o* .alue added ser.ices and a++lications aimed at enhancin) the +roducti.it, o* enter+rises and indi.iduals. • Reli%!"e E!er)+ Limited
2:
$eliance #ner), 1imited! incor+orated in :C2C! is a *ull, inte)rated utilit, en)a)ed in the )eneration! transmission and distri&ution o* electricit,. It ran(s amon) India>s to+ listed +ri.ate com+anies on all ma3or *inancial +arameters! includin) assets! sales! +ro*its and mar(et ca+italiHation. It is India>s *oremost +ri.ate sector utilit, with a))re)ate estimated re.enues o* $s C!599 crore 4USG 2.: &illion5 and total assets o* $s :9!A99 crore 4USG 2.< &illion5. $eliance #ner), 1imited distri&utes more than 2: &illion units o* electricit, to o.er 25 million consumers in Mum&ai! Delhi! /rissa and Boa! across an area that s+ans :!2s dream o* &rin)in) a&out a di)ital re.olution that will +ro.ide e.er, Indian with a**orda&le means o* communication and a read, access to in*ormation. The com+an, &e)an o+erations in :CCC and has o.er 29 million su&scri&ers toda,. It o**ers a com+lete ran)e o* inte)rated telecom ser.ices. These
2<
include mo&ile and *i-ed line tele+hon,6 &road&and! national and international lon) distance ser.ices! data ser.ices and a wide ran)e o* .alue added ser.ices and a++lications aimed at enhancin) the +roducti.it, o* enter+rises and indi.iduals. • Reli%!"e E!er)+ Limited $eliance #ner), 1imited! incor+orated in :C2C! is a *ull, inte)rated utilit, en)a)ed in the )eneration! transmission and distri&ution o* electricit,. It ran(s amon) India>s to+ listed +ri.ate com+anies on all ma3or *inancial +arameters! includin) assets! sales! +ro*its and mar(et ca+italiHation. It is India>s *oremost +ri.ate sector utilit, with a))re)ate estimated re.enues o* $s C!599 crore 4USG 2.: &illion5 and total assets o* $s :9!A99 crore 4USG 2.< &illion5. $eliance #ner), 1imited distri&utes more than 2: &illion units o* electricit, to o.er 25 million consumers in Mum&ai! Delhi! /rissa and Boa! across an area that s+ans :!2= A""ide!t - de%t be!e&it riders=
INTRODUCTION TO C/ANNEL DEVELOPMENT AND RECRUITMENT
1 o is %! i!sur%!"e %d6isor7
An a)ent is the re+resentati.e o* an insurance com+an, who sells di**erent +olicies or +roduct to its clients. Another term used *or insurance a)ents is %d6isorsG $eliance 1i*e Insuranceli*e insurance com+an, 1td introduced this term. Toda, in li*e insurance com+anies> ad.isors are (nown to &e the &ac(&one o* the whole s,stem. Ad.isors/a)ents do not wor( on monthl, +a,roll &asis6 the, recei.e a certain commission on the +olicies the, sell to the clients. The eli)i&ilit, re=uired to &ecome an ad.isor/a)ent is that he/she should &e :2th +ass to o+erate in ur&an area and :9th +ass *or rural areas. Be*ore a +erson &ecomes an ad.isor/a)ent he/she has to under)o :99hrs trainin) accordin) to I$DA norms! which is com+ulsor,. A +erson who wants to &e an ad.isor has *irst to *ill a recruitment *orm and has to +a, a *ee o* $s. :599/- in *a.or o* I"I"I Prudential. Then! he has to +ass a test! which is com+iled &, I$DA. A*ter he )ets throu)h that test he is awarded a license and then his trainin) starts in the com+an, re)ardin) the insurance &usiness. I"I"I Pru +ro.ides this trainin) in 7 modes as +er the suita&ilit, o* the ad.isors .iH':5 "lassroom trainin)' - it is a Full Time Training with a +eriod o* :A da,s re)ular &etween C am to 5+m at the trainin) centers allotted to the ad.isor. 25 /nline trainin)' - it is another mode o* trainin) where the com+an, +ro.ides "D>S and &oo(s to the ad.isor *or his own stud,.
57
75 "lassroom trainin)' - it is a Part Time Training with a +eriod o* 7@ da,s.
Ad6isor Role.
To +ro.ide on)oin) *inancial ad.ice *or his/her clients'
? ? ? ? ? ? ?
Identi*, *uture clients Ma(in) a++ointments "onduct *inancial re.iew meetin)s with +ros+ects/clients. "lose sales Bet re*errals Pro.ide ser.ice to clients. 0ollows internal sales and re+ortin) s,stem.
1or8i!) E!6iro!me!t o& %! %d6isorH%)e!t=
? ? ? ? ? ?
To &e a +art o* world-class sales team. %or( *rom ,our own o**ice or residence. %or( *ull time or +art time 4an ad.isor can wor( +art time &, under)oin) onl, 59hrs o* trainin) and :99hrs trainin) is *or *ull time ad.isors.5 #arn "ommission! Bonus D Incenti.es. No u++er limits on earnin)s. 0le-i&le career.
Opportu!ities &or %! Ad6isorH%)e!t
? ?
No startu+ ca+ital re=uired. 0le-i&le wor(in) en.ironment.
5<
? ? ?
Be ,our own &oss. Unlimited earnin) +otential. To &e a +art o* a world-class team.
Commissio! Stru"ture=
Di**erent +roducts will ha.e di**erent commission structures. 0or e-am+le' Sin)le Premium +roducts will ha.e a commission o* 2?. $enewal "ommission is +aid at the *ollowin) rates'
?
2nd ,r' A.5? 7rd ,r' A.5? s M $>s Doctors Teachers L$S holders Ad.isors o* other insurance com+anies Post o**ice a)ents Businessmen Accountants /I in an or)aniHation
/o$ does %! %d6isorH%)e!t $or87
?
0irstl, an ad.isor/a)ent has to ma(e a list o* :99 +eo+le that he/she (nows. Then the ad.isor/a)ent ma(es a call to these clients and tries to *i- an a++ointment.
?
5@
?
%hen an a++ointment is *i-ed! the ad.isor/a)ent meets the customer D tries to sell the +roduct. A*ter that the ad.iso/a)ent as(s *or re*erence o* ma-imum num&er o* +eo+le *rom the client. The re*erence is as(ed in conte-t to ma(e *uture calls and whole +rocedure is re+eated a)ain.
?
?
5A
I!sur%!"e %d6isor+ sur6e+
Ge!der o& t e respo!de!t
Gender of the respondants Male Female 40 10
5
Fem al Male
I!&ere!"e.
As we can see *rom the *i)ure itsel* that there is a se- ratio di**erence &etween males and *emales! s +erce+tion o* their &rand in the mar(et and .ia this increasin) their ad.isor &ase &, encashin) on their &rand name.
C, ;ence! our sales +itch in recruitin) the )ood +ro*ile ad.isor was &ased on'
?
Mo!e+.
0or those who are need,! )reed, and s+eed, ? ? #-cellent &ac( end su++ort! attracti.e +a,ments and &ene*its and #-tensi.e trainin) *or that ed)e o.er com+etition
?
Re$%rd %!d Re"o)!itio!
0or those who want to &e reco)niHed and honored
?
Se.eral +ro)rams includin) *orei)n tri+s! seminars etc.
@7
?
Selected clu& mem&ershi+s li(e +resident>s clu&! I"I"I Pru Star "lu&! MD$T clu& etc. Achie.ements rewarded with tro+hies and certi*icates as well with Point rewards to )i.e ,ou a *l,in) start.
?
?
C%rrier Prospe"ts
0or +eo+le who want to clim& the success ladder *ast. Pro)rams li(e PINNA"1#! AB#N"M ";AMPI/N and TIB#$ T#AM has &een de.ised. This whole strate), was &ased on the MAS1/%Qs T;#/$M /0 N##DS.
?
>, Then! instead o* )oin) +ersonall, and meetin) these alresd, well-esta&lished
Ad.isors! we tried the conce+t o* holdin) B/P 4 Business /++ortunit, +resentation5.
?
0or this we dra*ted an in.itation! which was a )immic( so as to entice these ad.isors into comin) to our own o**ice! and it was &ased on the +rete-t o* /N# MI1I/N P/1I"M "#1#B$ATI/NS! the tar)et that I"I"I P$U has 3ust achie.ed.
?
And result was )ood in the sense that we were a&le to con.ert 5 to :9 ad.isors *or our com+an, then and there onl,.
@<
D, Then! we tar)eted hi)h +ro*ile +eo+le li(e "A>s or MBA>s or )o.t.Peo+le.
0or that! we dra*ted a letter in which we 3ust )a.e them a han) o* what our +ro+osal was *or them 4*or recruitin) them as our ad.isors5 and as(ed them to contact us themsel.es i* the, are interested. %e )ot at least :9-:5 calls o* +eo+le who were interested and wanted to &ecome our ad.isors. Meetin)s were held with them and the, were con.erted. The B/P letter and then in.itation *or the B/P i.e. Business /++ortunit, +resentation has &een attached at the end in the anne-ure.
@5
@@
S1OT ANAL9SIS Stre!)t
?
V%st u!t%pped m%r8et.
In a countr, o* : &illion +eo+le there is a hu)e +otential mar(et *or li*e insurance +roducts. In India the +enetration o* the insurance sector in the rural and semi-ur&an areas is low. There is a mar(et o* C99 million *or li*e insurance and 299 million *or householder>s insurance +olic,. In addition to this the a**luent section can &e ta++ed *or /.erseas Mediclaim and Tra.el Insurance +olicies.
?
/u)e pool o& s8illed pro&essio!%ls.
%hether it is &an(s or insurance com+anies! there is no dearth o* s(illed +ro*essionals in India to carr, out a success*ul &anc assurance .enture.
1e%8!ess.
?
L%"8 o& !et$or8i!) %mo!) b%!8 br%!" es
In s+ite o* )rowin) em+hasis on total &ranch mechaniHation 4TBM5 and *ull com+uteriHation o* &an( &ranches! the rural and semi-ur&an &an(s ha.e still to see in*ormation technolo), as an ena&ler. "om+lete inte)ration o* &ranch networ( in.ol.es hu)e in.estments *or creation IT and communication in*rastructure.
@A
?
Lo$ s%6i!)s r%te
Thou)h we ha.e a hu)e mar(et *or insurance +olicies! the middle class who constitutes the &ul( o* this mar(et is toda, &urdened under in*lationar, +ressures. The secret lies in includin) sa.in)s ha&it &ut considerin) the amount o* sur+lus *unds a.aila&le with the middle class *or in.estin) in *uture securit,! the a&ilit, to sa.e is .er, nominal.
Opportu!ities.
?
D%t% mi!i!).
Ban(s ha.e a hu)e customer data&ase which has to &e +ro+erl, le.era)ed. Tar)et se)ments should &e identi*ied and ta++ed.
? ?
%ide distri&ution networ(s o* &an(s +ro.ides a )reat o++ortunit, to sell insurance +roducts throu)h &an(s
Another +otential area o* )rowth o* &anc assurance is e-+loitin) the cor+orate customers and t,in) u+ *or insurance o* the em+lo,ees o* cor+orate clients.
T re%ts.
@
?
;uman $esource "hallen)es
Success in &anc assurance .enture re=uires a chan)e in mindset. Thou)h we ha.e a lar)e talent +ool! the ina&ilit, to sell com+le- insurance +roducts on the +art o* &an( +ro*essionals and their reluctance to learn can &e se.ere set&ac(. There has to &e a chan)e in the thin(in)! a++roach and wor( culture.
?
Non-res+onse *rom the tar)et )rou+s can also +ose a challen)e as it ha++ened in the USA in :C 9s
@C
A9
FUTURE GRO1T/ PROSPECTS OF COMPAN9
In the total mar(et share! 1I" has reduced its share *rom C:? to A9?. This means that +ri.ate insurance +la,ers ha.e )ot more mar)ins in their hands which ha.e increased *rom C? to 79? in last 2,ears onl,.
In the +ri.ate mar(et share! I"I"I P$U leads with 7C? o* the mar(et share in its hand *ollowed &, Ba3a3 AllianH with : ? shares and then comes BirlaSun 1i*e with :5? mar(et shares.
I"I"I P$U has &een maintainin) its N/ : +osition since last 5 ,ears &ecause o* its +roli*ic +roduct ran)e and commandin) &rand e=uit,. It has a hi)hest ca+ital &ase o* $s. C25 crores and a team o* more than 5@!799 wee(-trained ad.isors. It en3o,s a &rand recall rate o* C2? and )i.es credit o* its success to the 5 core .alues-
? ? ? ? ?
Inte)rit, "ustomer Boundar, 1ess /wnershi+ Passion
A:
COPETITIVE ANAL9SIS 1IT/ /DFCs lar)est housin) *inance +ro.ider! ;D0" and #uro+e>s lar)est mutual li*e assurance The Standard 1i*e Assurance "om+an, 4U. K5. Standard 1i*e! UK! *ounded in : 25! has &een at the *ore*ront o* the UK insurance industr, *or :A5 Mears &, com&inin) sound *inancial 3ud)ment with inte)rit, and relia&ilit,. It is the L%r)est Mutu%l Li&e "omp%!+ i! Europe and has total assets o* $s. 5!59!999 crore.
Tr%i!i!) %"ti6ities &or %)e!tsH%d6isors.
? ? ? ?
As +er I$DA )uidelines! :99hrs trainin) is com+ulsor,. Both online D classroom trainin) are a.aila&le. Trainin) is com+ulsor, with &oth +art-time D*ull time /+tions. A clear e-am is conducted &, I$DA! the minimum Ruali*ication re=uired is-
A2
:2th +ass *or ur&an areas :9th +ass *or rural areas.
Commissio! Stru"ture.
De+ends on the +roduct! li(e on sa.in)s 29-