SUMMER TRAINING REPORT

ON
“DISTRIBUTION ENHANCEMENT AND STUDY OF PRODUCT
OF HDFC STANDARD LIFE INSURANCE COMPANY”
AT
“HDFC STANDARD LIFE INSURANCE COMPANY LIMITED”
Submitted in partial fulfillment of the requirement for the
Postgraduate Diploma in Management

INTRODUCTION
During my summer training in the Housing Development finance corporation
standard life insurance company limited (HDFCSL). I have gotten the work of
recruitment of financial consultant or financial advisor, or insurance agent who
becomes the base of any insurance company. In the company my department was
Channel Development Department whose work is to recruit financial consultant and I
was working as a recruitment consultant manager. The main focus area of the
company is to recruit more and more financial consultant who brings business in the
company. Indeed the work of financial consultant is very significant and gives more
and more distribution of the policy of the insurance to the company thorough selling
the policies. The main motive of this project is distribution enhancement.
HDFCSL is one of India’s leading private insurance companies. It offers
both individual and group insurance solution. It is a joint venture between HDFC and
a group of company of Standard Life. I have chosen insurance sector as the place
for summer training because in these days this sector is in boom and it will never go
down. All people invest their money in insurance and get more benefited. In the
sector the work of marketing is more challenging then the other sector because there
is 17 insurance companies in the market who are giving competition to each other
and the work of convince people for investment in respective company is a
challenging work and success in the sector proves that the respective person is a
good marketer. Today insurance sector India is on boom because all people want to
invest. Those who don’t know about investment in share market and don’t want to
invest in mutual funds they invest in insurance sector. Insurance sector gives them
investment plus risk cover. Those who don’t want to take risk in the investment go to
insurance sector. It also gives income tax benefits to the peoples. Insurance
company are now launching ULIP plan and gives chance to the investor to choose
their investment pattern according to their fund investment table(this table is included
in the product information of the product of HDFC Standard life). This fund
investment tells us that how much the investor want to take risk. Generally in the
ULIP plan, the thesis is that “The more you risk the more you have profit.”
NEED OF THE STUDY
The project was an attempt to explore the “Distribution Enhancement of insurance
policy of HDFCSL” in Noida. The project was started on 10th June, after knowing all
the relevant information about the company insurance product and policies and its
competitor’s insurance products in accordance with the prescribed schedule
mentioned by management of HDFCSL.
The project started in Noida region covering all the local market. In this
process I meet 90 persons to recruit them as a financial consultant. I have tried to
recruit FC from telephone calling, and natural market. During my work I found the
perception of the people about insurance, what they desire from it, and if they will
work as financial consultant than what they want from the organization. What the
organization should do for the recruitment of more and more FC and should give
more facilities to them, reimbursement, and time to time gift voucher, and weakly
training or meeting with FC to encourage them.
SCOPE OF STUDY
During the summer training I have done my work through telephone calling, natural
market, and contact person having gone to their home. In the entire work I have
contacted person who is student, person who is working in the organization, visit
colleges, IGNOU study centre in Delhi regions Property dealers and lowers.
I found that most of person can join insurance company for saving taxes,
unlimited earning, life time earning with little effort, which will give him back support
as a HEAD of the family in the diverse situation.
This project will help to understand the current market scenario and marketing
in stiff competition. Being a student of management I can draw the relevant
conclusion from the market survey and give the appropriate suggestion to the
organization. The company can take decision according to the suggestions and it will
provide better experience to the students for their bright carrier. My project will provide help
in these matters which are thus:-

ABOUT HDFSLIC
HDFCSLIC stands for Housing Development Finance corporation standard life
insurance company. It is incorporated in 1977 as a public limited company with the
specialization in provision of housing finance to individuals’ cooperative societies and
the corporate sector. One significant matter about the HDFC is that it is first private
sector retail housing finance company and it is listed on both BSE and NSE. Its
market capitalization in June 2002.
6

Standard life insurance is founded in 1825. Standard life was

reincorporated as a mutual assurance company in 1925. It’s largest mutual life
insurance company in Europe.

For the joint venture between HDFC and SLIC, the discussion commenced
in January 1995 and the agreement signed in October 1995. Further joint venture
agreement renewed in October 1998. In January 2000 the life insurance project
teem established in Mumbai. At last the company officially incorporated in 14th
August 2000. It is the matter of great happiness for HDFCSLIC is that it is the first
private sector life insurance company to be granted a certificate of registration in
23rd October, 2000. Today 75% shareholding in the hand of HDFC and Standard life
has 25% shareholding in this joint venture.
COMPANY PROFILE
When we talk about company profile then HDFC standard life insurance company is
targeting insurance sector. It is launching various type of insurance plan and product
which is enticing people to buy its plan. As a insurance company it focus mainly in
the recruitment of financial consultant and the whole company based on it because
the main aim of company is to get business and sell lots number of policy and this
work is done by financial consultant.
HDFC Standard Life Vision and Values
Vision of HDFCSL
The most successful and admired life insurance company, which mean that we are
the most trusted company, the easiest to deal with, offer the best value for money,
and set the standards in the industry. In short, “The most obvious choice for all”
For retention in the market and highest market share, we need trust of our
customer. The customer should trust on our policies, services, employs and they
should be friendly with us. It wants to live in the eye and heart of the customer. It
wants to give them the easiest deal so that they can be understood the terms and
policies. As we know that profit is the main aim of any business but it think not only
about his profit but also profit of the customer. It wants to be the choice of all people
on the basis of trust of customer, delivering high value to the customer, and deliver
Of best value of the money
Value that will be observed while we work with HDFCSL
1. Integrity
HDFCSL believes in honest and trustfulness in every action. Transparency in dealing
with customers. It is stick to principles irrespective of outcome. When we work in
HDFCSL then we observed that its rules and activity of every person in the
organization is just and fair to every one.
Integrity is the bedrock on which the company and the expectations of the
customers and employees are built. Integrity gives inner feeling to both customer
and the employees to work with it. It establishes the credibility of the person, defines
the character and empowers one to do justice to the job. It enables confidence and
trust, achieving transparency and laying a strong foundation for a binding
relationship. It guide principle for all walks of life.
2. Innovation
It is the process of building a store house of treasures through experiences. Lots of
product is going to be launched by the competitors. So it is very important to look
every product and process through fresh eyes everyday. It is the significant part of
the business that attracts customer.

Innovation is essential to exceed customer expectation and maximize

customer retention because it is the sector of investment so you need to fulfill the
customer expectation which help you to retain customer. Innovation helps to achieve
competitive advantage. It promotes growth and upgrade standards in the industry. It
fosters creativity amongst employees and partners. It opens a world of new
possibilities because it brings new concept which helps to entice the customer.
3. Customer centric
Customer becomes the main properties of any organization. Whatever work done by
the organization runs around the expectations of the customer. Customer becomes
centre point of the organization and the main focus of the organization becomes to
understand his expectations by keeping him as the centre point. It gives more focus
on customer activity and saying. It tries

to understand customer needs and deliver solutions. As we know that the market is
changed. Lots of competitors is here who search chance to increase their market
share and entice your customer so customer interest become always supreme.
4. People Care
Genuinely try to understand those people who are working with HDFCSL. It guides
their development through training and support. It helps them to develop their
requisite their skills so that they can reach their true potential. It tries to know them
on a personal front because it works as a performance appraisal. It try to create an
environment of trust and openness so that all people who are working here behave
friendly and helps to each other because team work is most important for getting
success and give respect for the time of others.
People are the most valuable assets of the company so it tries to motivate
individual to give his/her best. It wants to establish a valuable relationship with them
to create a joyful working environment. The most important thing is that it tries to
provide job satisfaction for their people.
5. Team work “One for all and all for one”

Here whole team takes the ownership of the deliverables. It consults all involved in
the work and try to understand their opinion and then arrive ant a common objective.
There is a cooperation and support across departmental boundaries. It identifies
strengths and weaknesses accordingly allocate responsibility to achieve common
objectives.
Team work helps everyone to achieve more. it adds joy at work place which add
interest in the work and new stamina in the work. It generates synergy and provides
a focused approach. When an idea or activity performed in a group, it has greater
acceptability. “Team work proves one for all and all for one”.
6. Joy and simplicity
It believes in joy and simplicity so that people in the organization will be more
dedicated towards work and they will give more business to the organization. Work
with joy and simplicity brings creativity and new imagination which also brings new
innovative ideas that promote competitive advantage to the organization.
MISSION OF HDFSLIC
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We aim to be the top new life insurance company in the market.

This does not just mean being the largest or the most productive company in
the market, rather it is a combination of several things like-
Customer service of the highest order
Value for money for customers
Professionalism in carrying out business
Innovative products to cater to different needs of different customers
Use of technology to improve service standards
Increasing market share
HDFC GROUP COMPANIES
HDFC Limited
HDFC Bank
HDFC Asset Management Co. Limited
HDFC Securities Limited
HDFC Standard Life Insurance Company
Intel net Global
CIBIL – Credit Information Bureau Investigation Ltd
HDFC Chubb General Insurance

WHAT IS INSURANCE?
The business of insurance is related to the protection of the economic values of
assets. Every asset has a value. The asset would have been created through the
efforts of the owner. The asset is valuable to the owner, because he expects to get
some benefit may be an income or in some other form. It is a benefit because it
meets some of his needs. The benefit may be an income or in some other form. In
the case of a factory or a cow, the product generated by it is sold and income is
generated. In the case of a motor car, it provides comfort and convenience in
transportation. There is no direct income. Both are assets and provide benefits.
Every asset is expected to last for a certain period of time during which it will
period of time during which it will provide the benefits. After that, the benefit may not
be available. There is a life-time for a machine in a factory or a cow or a motor car.
None of them will last for ever. The owner is aware of this and he can so manage his
affairs that by the end of that period or life- time, a substitute is made available.
Thus, he makes sure that the benefit is not lost. However, the asset may get lost
earlier. An accident or some other unfortunate event may destroy it or make it
incapable of giving the benefits. We can classify insurance in these terms:-
It is a system by which the losses suffered by a few are spread over many,
exposed to similar risks.
Insurance is a protection against financial loss arising on the happening of
an unexpected event.
It is essential that:
The calamity is either natural or unexpected
The insured person does not gain out of this arrangement
It is a system by which the losses suffered by a few are spread over many,
exposed to similar risks.
Insurance is a protection against financial loss arising on the happening of
an unexpected event.
It is essential that:
The calamity is either natural or unexpected
The insured person does not gain out of this arrangementIt is a system by which the
losses suffered by a few are spread over many,

exposed to similar risks.

Insurance is a protection against financial loss arising on the happening of
an unexpected event.
It is essential that:
The calamity is either natural or unexpected
The insured person does not gain out of this arrangement
OBJECTIVES
When we talk about objective of the insurance sector we can divide it into
three categories which are thus.
Broad
Increased coverage of the population
Specific
Customer has a wider choice & range of products
Service standards to customer
Economic
Savings mobilization
In this objective part the first part deals with its market share because it deals with all
people who live in India and it has a broad market potential. So the main motto is to
increase and entice more and more people for insurance.
In the second part it deals with innovative plans and schemes for the wider
choice of people and different range of products of its competitors. It tries to serve its
customer with significant way.
HDFCSL invest the investment in the share market through the unit link plane
and get and give significant return from the markets and satisfy their customer.
“We are All at risk"
A little mouse living on a farm was looking through a crack in the wall one
day and saw the farmer and his wife opening a package.
The mouse was intrigued by what food the package may contain.
He was aghast to discover that it was a mousetrap. The mouse ran to the farmyard
warning everyone "there is a mouse trap in the house, there is a mouse trap in the
house."
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The chicken raised his head and said "Mr. Mouse, I can tell you this trap is a grave
concern to you, but it has no consequence to me and I cannot be bothered with it. "
The mouse turned to the pig "I am so very sorry Mr. Mouse, but the trap is
no concern of mine either."
The mouse then turned to the goats, "sounds like you have a problem Mr.
Mouse, but not one that concerns me."
The mouse returned to the house, head down and ejected that no one would help
him or was concerned about his dilemma. He knew he had to face the trap on his
own.
That night the sound of a trap catching its prey was heard throughout the
house. The farmer's wife rushed to see what was caught.
In the darkness she could not see that it was a venomous snake who's tail the trap
had caught. The snake bit the farmers wife. The wife caught a bad fever and the
farmer knew the best way to treat a fever was with chicken soup.
The farmer took his hatchet to the farmyard to get the soups main ingredient. The
wife got sicker and friends and neighbors came by to take turns sitting with her round
the clock.
The farmer knew he had to feed them, so he butchered the pig.
The farmer's wife did not get better, in fact she died and so many friends and family
came to her funeral that the farmer had to slaughter the goats to feed all of them.
So the next time we hear that one of our team-mates is facing a problem and think it
does not concern or affect us, Let us remember that when anyone of us is in trouble,
We are All at risk.

Life Insurance Sector

India is emerging as one of the two of the largest markets in the world for life
insurance products, the other being China. In the case of India, the three key drivers
of growth are a large insurable population, a high savings rate, roughly at about 25
per cent and a low penetration, at a mere 2.3 per cent. In the 11 months of fiscal
year 2004-05, life insurance companies collected premium worth Rs 172 billion and
the market grew by a whopping 32.4 per cent during the year. Of this, the public
sector Life Insurance Corporation (LIC) had the lion's share of the market with
premium totaling Rs 134 billion. Private sector players recorded a spectacular growth
of 129 per cent over the last year, compared to LIC's growth of 18 per cent. India's
GDP growth rate of 6 per cent per annum holds great potential for the sector.
According to one estimate real life premium are expected to grow at a compounded
annual rate of 15 per cent over the next ten years.
How does India's life insurance market compare with China's? While India's market
is currently the fifth largest, China's is the third largest in Asia after Japan and Korea.
Low penetration rate of insurance products is common to India and China - at just
about 2.3 per cent. In China, the savings rate is at 35 per cent while for India it is a
little lower at 25 per cent. A large part of the growth of the life insurance market in
China was driven by the conversion of bank deposits into endowment products.
Demographically,
China's
population
is
ageing
faster
than
India's.
FDI in
Insurance Sector
The government of India is planning to increase the equity limit for foreign direct
investment from the current 26 per cent to 49 per cent in the insurance sector.
Liberalizations of the FDI policy, including the Budget proposals for raising the sect
oral caps in insurance is one of the main factors for the higher FDI inflows during the
current year. In 2003-04 the total FDI inflows in the country touched $3.4 billion.
Indian insurance companies have been pushing for the FDI limit to be raised. The
current paid-up requirement of Rs 1 billion for general insurance and Rs 2 billion for
life insurance have become difficult targets to achieve for the companies. The
companies feel that injection of additional foreign equity would reduce their costs.
The sector was liberalized for private players towards the end of 1999. Currently,
there are 14 insurance companies, including the key public sector company Life
Insurance Corporation, in the life insurance sector and 13 general insurance
companies.
Changing Demographics
In 1999, according to KSA-Techno park, savings and investments comprised
14 per cent of an Indian consumer’s expenditure. The other items included
grocery (44 per cent), personal care items (6 per cent), consumer durables
(6.6 per cent), clothing and books and music (5 per cent each), eating out (8
per cent), movies (1 per cent). By 2003, expenditure on savings and
investments had declined to just 4.1 per cent. The other items included
grocery (41 per cent), personal care items (7.6 per cent) , consumer durables
(6.6 per cent), clothing (6.9 per cent), eating out (10.8 per cent), movies and
theatres (4.6 per cent), books and music (7.6 per cent), vacations (3.9 per
cent). Clearly, the increased spending on other items have had a huge impact
on the amount people are spending on savings and investment products.
(Source: Business World’s Marketing White book 2005).

China's
population
is
ageing
faster
than
India's.
FDI in
Insurance Sector
The government of India is planning to increase the equity limit for foreign direct
investment from the current 26 per cent to 49 per cent in the insurance sector.
Liberalizations of the FDI policy, including the Budget proposals for raising the sect
oral caps in insurance is one of the main factors for the higher FDI inflows during the
current year. In 2003-04 the total FDI inflows in the country touched $3.4 billion.
Indian insurance companies have been pushing for the FDI limit to be raised. The
current paid-up requirement of Rs 1 billion for general insurance and Rs 2 billion for
life insurance have become difficult targets to achieve for the companies. The
companies feel that injection of additional foreign equity would reduce their costs.
The sector was liberalized for private players towards the end of 1999. Currently,
there are 14 insurance companies, including the key public sector company Life
Insurance Corporation, in the life insurance sector and 13 general insurance
companies.
Changing Demographics
In 1999, according to KSA-Techno park, savings and investments comprised
14 per cent of an Indian consumer’s expenditure. The other items included
grocery (44 per cent), personal care items (6 per cent), consumer durables
(6.6 per cent), clothing and books and music (5 per cent each), eating out (8
per cent), movies (1 per cent). By 2003, expenditure on savings and
investments had declined to just 4.1 per cent. The other items included
grocery (41 per cent), personal care items (7.6 per cent) , consumer durables
(6.6 per cent), clothing (6.9 per cent), eating out (10.8 per cent), movies and
theatres (4.6 per cent), books and music (7.6 per cent), vacations (3.9 per
cent). Clearly, the increased spending on other items have had a huge impact
on the amount people are spending on savings and investment products.
(Source: Business World’s Marketing White book 2005).
Composition of Household Financial Savings
1991 1996-97 2002-03
38

Currency
10.6% 8.6%
8.5%
Deposits
33.3% 48.2% 41.5%
Of which Deposits with non banking companies 2.2% 16.4% 1.6%
Shares and debentures
14.3% 6.6%
2.7%
Small savings (central govt. schemes)
13.2% 7%
14.3%
Life insurance
9.5% 10.1% 15.5%
Provident and pension funds
16.9% 19.1% 14.3%
Source: RBI Annual Reports.
Key Players in the Indian Market
While the public sector LIC dominates the Indian life insurance market with
nearly 80 per cent of the market share. It has 248 branches, 115,000
employees and over 1 million agents. It has also been improving internal
processes and systems, upgrading skills of its agency force and managers
and developing innovative products. LIC sold 1.69 corers policies during the
year compared to 18 lakh policies sold by all the private players.
ICICI Prudential is the leader among the private players with a market share
of 6.69 per cent after its premium collection totaled Rs 11.54 billion. Bajaj
Allianz with sales of Rs 4.9 billion had a market share of 2.86 per cent. Birla
Sun Life with sales of Rs 4.8 billion had a market share of 2.81 per cent and
SBI Life with premium collection of Rs 3.9 billion, a market share of 2.29
per cent. With its combination of aggressive marketing through an agency
force and the use of the banking channel, ICICI has emerged as a key player.
Initially, the company drove new business by opening branches in new
locations. The focus has now shifted to penetrating these locations for
increasing market share. The company is also trying to get higher
penetration in the High Net Worth segment. The company has seven bank
assurance partners and this is the largest contributor to non-agency business.
It also has 15 key non-bank partners and 800 financial sales consultants. As
of September 2004, it had 90 branches in 60+ locations. It took the initiative

in launching non-traditional products such as life-stage products, retirement

solutions and child plans. It also focused on Unit Linked Plans (ULIPs) to
target new consumer segments. It has a presence in 15 states through
partnership arrangements and as of 2003-04, it sold 64,764 policies in rural
areas.
HDFC Standard Life has established its branches in 110 locations and is
targeting non-metro towns. It is hoping to leverage its “pedigree/parentage”
to gain more customer acceptance. As a result, it is focusing on quality – not
39

just volume growth. It has developed some innovative products like the
Loan Cover Term Assurance Plan which provides a lump sum in case of
death of the assured life during the term plan. Aimed at the growing segment
of home loan takers, the plan helps the family to repay the outstanding loan.
Given that HDFC has a huge database of home-loan customers; it can easily
tap into this resource to acquire new business. The company is leveraging
Product Preferences among Consumers
Pension policies are becoming popular as people are preferring to opt for
solutions that can offer them a regular income after retirement rather than
a lump sum on retirement. Maturable policies for a bulk sum are being
bought only for limited single use such as purchase of a house, children’s
higher education, marriage, etc. This consumer trend is likely to help
companies that offer pension schemes. Term policies are finding favor with