By Adarsh Mishra Report on Marketing Mix & Promotional Strategies at IDBI Federal Lfe Insurance Final Report

A Report on

“Marketing Mix and Promotional Strategies of IDBI Federal Life Insurance Co. Ltd.” (A summer training project report submitted in partial fulfilment of the requirement of Post-Graduation Diploma in Management)

2013-15 Under the guidance of:

Submitted By:

Corporate Guide:

Ms. Piyushi Verma

ADRASH MISHRA

(Manager Distribution) IDBI Federal Life Insurance

PGDM 2ND YEAR Roll No.-:22061

Faculty Guide:

Dr. Agna Fernandez (M.Com, FPM-XLRI, Associate Professor)

Siva Sivani Institute of Management

S i v a S i v a n i I n s t i t u t e o f M a n a g e m e n t - S e c u n d| Peargae b a d

ACKNOWLEDGMENT I would like to express my gratitude to Ms. Piyushi Verma, MANAGER DISTRIBUTION, for providing us an opportunity to work in IDBI Federal Life Insurance Co. Ltd. for entrusting me and providing me valuable inputs for my project “Marketing Mix and Promotional Strategies of IDBI Federal Life Insurance Co. Ltd.” I sincerely express my gratitude to Dr. Agna Fernandez, M.Com, FPMXLRI, Associate Professor (my faculty guide), for giving her valuable guidance, healthy support and suggestions to make the project a successful one. I would also like to express my gratitude to Ms. Piyushi Verma (my company guide) for providing their valuable feedback and intense support relentlessly throughout the project. I am really thankful to my parents and friends for helping me to study and giving feedback in all possible ways to make me feel comfortable during my project. There have been numerous influences, big and small that have helped me to work on my project successfully. Regardless of the source, I thank all those who may have contributed to this project.

ADRASH MISHRA 22-061 Siva Sivani Institute of ManagementSECUNDERABAD

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PREFACE Life insurance business is booming in India. The business of life insurance is related to the protection of the economic value of human life and this project is just offered to draw the attention of individuals, who are interested in life insurance business running by Insurance Regulatory Development Authority (IRDA). Insurance industry has Ombudsmen in 12 cities. Each Ombudsman is empowered to redress customer grievances in respect of insurance contracts on personal lines where the insured amount is less than Rs. 20 lakh, in accordance with the Ombudsman Scheme. Addresses can be obtained from the offices of LIC and other insurers. This project is like just an extract of my rigorous work in Life Insurance Companies, and I hope the beneficiaries’ decision regarding recruitment of advice; or, all information and data. This responsibility really in hence my effective communication and convincing power and such quality will help me in near future for having decision making.

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AUTHORISATION This is to certify that the project title: “Marketing Mix and Promotional Strategies of IDBI Federal Life Insurance Co. Ltd.” is

a bonafide work

completed by ADRASH MISHRA, Enrollment Number 22-061, in partial fulfillment of the requirements of the PGDM Program and submitted to SIVA SIVANI INSTITUTE OF MANAGEMENT- SECUNDERABAD. I declare that this project is a result of my own efforts and has not been copied from any source. References from which information has been taken have been given in the references section. This work has not been submitted earlier at any other university or institute for the award of the degree.

ADRASH MISHRA 22-061 SIVA SIVANI INSTITUTE OF MANAGEMENTSECUNDERABAD

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Table of Contents ON THE JOB TRAINING ............................................................................................................................ 1 Company Assigned activities:................................................................................................................... 1 Targets Assigned:...................................................................................................................................... 1 Accomplishments/Achievement of Objectives ......................................................................................... 1 Learnings: ................................................................................................................................................. 1 CHAPTER ............................................................................................................................................ 2

I.

INTRODUCTION .................................................................................................................................... 2 NEED OF THE STUDY ........................................................................................................................... 5 OBJECTIVES OF THE STUDY .............................................................................................................. 5 LIMITATIONS ......................................................................................................................................... 5 RESEARCH METHODOLOGY .............................................................................................................. 6 REVIEW OF THE LITERATURE........................................................................................................... 7 CHAPTER .......................................................................................................................................... 10

II.

INDUSTRY PROFILE ........................................................................................................................... 10 COMPETITOR ANALYSIS .................................................................................................................. 20 COMPANY PROFILE ........................................................................................................................... 24 SWOT ANALYSIS OF IDBI FEDERAL LIFE ..................................................................................... 30 CUSTOMERS......................................................................................................................................... 31 CHAPTER ...................................................................................................................................... 32

III.

THEORETICAL ASPECT RELATED TO TOPIC OF THE STUDY .................................................. 32

IV.

A.

Marketing Mix at IDBI Federal Life Insurance .......................................................................... 32

B.

Promotional Strategies at IDBI Federal Life Insurance .............................................................. 41

C.

Promotional Strategies Adopted By IDBI Federal...................................................................... 48 CHAPTER ...................................................................................................................................... 50

DATA ANALYSIS & INTERPRETATION .......................................................................................... 50 V.

CHAPTER .......................................................................................................................................... 67

REFERENCES ........................................................................................................................................... 69 ANNEXURE............................................................................................................................................... 70

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ON THE JOB TRAINING Company Assigned activities: The company IDBI Federal Life Insurance is into selling insurance products. The job assigned by the company is to get trained and enter the market to sell the products. During the training process I was trained on three insurance products, Life Insurance, Child Insurance, and Income insurance. The target given by the company is to complete one sale of insurance product which is successfully completed.

Plan of action and Execution / Activities performed Targets Assigned: • Twenty thousand worth of business before 13th May The target was achieve before 13th of May, during the process I met customers and explained them about three different insurance products with complete details and explanation about the benefits epically tax benefits one of the customer was convinced and I was able to make a thirty thousand rupees •Second 20000 businesses before 24th May •Third 20000 business before 3rd June • Fourth 20000 business before 12th June Goals The Second, third and fourth targets were incomplete; I went across many customers during this period I met the customers who already have the insurance in LIC which is a government player, hence it was difficult to convince them and close the sale.

Accomplishments/Achievement of Objectives At the completion of my 45 days of Industrial Internship Program I was able to complete the sale of one insurance product of thirty thousand businesses for completion of my target.

Learnings:   

The major learning from my IIP is to understand the mood of the customer and how react according the situation. Able to understand the corporate culture and flow of communication with the higher order officials Learnt that going out into the market and explain the customer is difficult, but after few days in the market it was comfortable.

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I.

CHAPTER

INTRODUCTION The Indian insurance industry has undergone transformational changes since 2000 when the industry was liberalized. With a one-player market to 24 in 13 years, the industry has witnessed phases of rapid growth along with extent of growth moderation and intensifying competition. There have also been a number of product and operational innovations necessitated by consumer need and increased competition among the players. Changes in the regulatory environment also had a path-breaking impact on the development of the industry. While the insurance industry still struggles to move out of the shadows cast by the challenges posed by economic uncertainties of the last few years, the strong fundamentals of the industry augur well for a roadmap to be drawn for sustainable long-term growth. The decade 2001-10 was characterized by a period of high growth (compound annual growth rate of 31 percent in new business premium) and a flat growth (CAGR of around two percent in new business premium between 2010-12) There was exponential growth in the first decade of insurance industry liberalization. Backed by innovative products and aggressive expansion of distribution, the life insurance industry grew at jet speed. Regulatory changes were introduced during the past two years and life insurance companies adopted many new customer-centric practices in this period. Product-related changes, first in ULIPs (Unit Linked Insurance Plans) in September 2011 and now in traditional products, will have the biggest impact on the industry This project involves an understanding of the marketing mix and finding out the various promotional strategies presently implemented by IDBI Federal Life Insurance Co. Ltd. and to find out its effectiveness through a study on consumer behavior towards these strategies. Insurance industry is an industry which is said to be in its Golden period now. And IDBI Federal is a fast growing company in this industry. IDBI Federal Life Insurance Co Ltd is a joint-venture of IDBI Bank, India’s premier development and commercial bank, Federal Bank, one of India’s leading private sector banks and Ageas, a multinational insurance giant based out of Europe. In this venture, IDBI Bank owns 48% equity while Federal Bank and Ageas own 26%

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equity each. IDBI Federal endeavours to deliver products that provide value and convenience to the customer. Through a continuous process of innovation in product and service delivery IDBI intend to deliver world-class wealth management, protection and retirement solutions to Indian customers. Having started in March 2008, in just five months of inception it has become one of the fastest growing new insurance companies to garner Rs 100 Cr in premiums. The company offers its services through a vast nationwide network across the branches of IDBI Bank and Federal Bank in addition to a sizeable network of advisors and partners. This project aims in understanding the marketing mix which exists in the insurance industry. The marketing mix is the combination of marketing activities that an organization engages in so as to meet the needs of its targeted market. The Insurance business deals in selling services and therefore due weight age in the formation of marketing mix for the insurance business is needed. The marketing mix includes sub-mixes of the 7 P’s of marketing i.e. the product, price, place, promotion, people, process & physical attraction. This project also aims to help the company to achieve its objective by focusing on their promotional strategies and to understand its effectiveness by understanding the customer perception towards these strategies. There are insurance marketing strategies that can take any insurance agency from mediocre to success when utilized correctly. Breaking into a new business climate and finding customers is hard work, but when equipped with innovative ideas and proven techniques, financial markets sales personnel can become extremely successful. Getting an education and training is very important in every industry, sales is certainly no exception. Those selling insurance will want begin their careers with the very best tools of the trade and those with already established businesses that are in need of a motivational push will also gain great benefits by researching and learning new insurance marketing tips. Through this project we will be able to understand the promotional strategies implemented by the company and also make an attempt to find out its effectiveness and suggest better promotional strategies which would help in increasing the overall profitability of the company. Commercial advertisements also create huge impact upon the minds of the customers hence this project also focuses upon the role of advertising in this industry. Insurance industry is a service oriented industry where promotional strategies play a vital role because this is an industry which deals with intangible products. Hence it is very necessary that the company adopt the best marketing strategies which help to communicate the product to

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the customer. With the help of questionnaires and interviews, this project also aims to understand the perception of the customer regarding the promotional strategies especially the commercial ads and thereby bringing the company more closely to the customers’ heart. Thus this project aims to study the promotional strategy the importance of these tools in creating increased sales and customer base for the company.

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NEED OF THE STUDY  To understand the seven P’s (Product, Place, Price, Promotion, People, Process, Physical evidence) of IDBI Federal Life Insurance Co. Ltd. And the promotional strategies they are using to promote the insurance products  Understanding roles and functions of Marketing manager and factors affecting decisions of marketing manager.

OBJECTIVES OF THE STUDY  To analyze Marketing Mix and Promotional Strategies of IDBI Federal Life Insurance Co Ltd.  To find how effectively advertisements influence a person to buy the life insurance products

LIMITATIONS  Time Duration of the project was 6 weeks. Within this short time, completion of the project was a challenge. Customers were unwilling to part with information required for the study.

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RESEARCH METHODOLOGY  Primary data  Secondary data Primary data: Data required for the study was collected through questionnaires. The sample size was 101 and the sampling unit was office going people who have either joined recently or who have been working for quite a few years. Questionnaires were mailed to respondents and few were handed over to them personally. Both open ended and close ended questions are used in the design of the questionnaire so as to know the opinion of customers relating to insurance and awareness about the brand IDBI federal and how they respond to the marketing stimuli adopted by the company. The type of questionnaire used in this project is structured. The questions are listed in a prearranged order and respondents are informed about the purpose of collecting information. The type of sampling was convenient sampling. Secondary data: Gathering data from internet and television, published articles, books, research reports and other sources.

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REVIEW OF THE LITERATURE Literature no. 1 A study by Garg & Verma(2010)1, The insurance firms should focus on the concept of MM and implement the concept. They should quantify the level of expenditure for their mix ingredients, study elasticity of the mix ingredients, carry out careful analysis in order to identify the most effective and economic mix, analyze their competitors’ mix while implementing MM, review the whole mix in detail so that each segment gets its own assemblage of mix components, and review their MM on a regular basis. The marketing departments of the insurance firms should call other functional departments while developing MM and provide details of their thinking on the subject.

Literature no. 2 In the study by Abdalelah S. Saaty(2011)2, attempts to find out the factors important in developing a suitable marketing strategy for insurance companies. It investigates the reasons for buying insurance by the current users of insurance, reasons for not buying insurance by nonusers of insurance and the issues and problems faced by Saudi Insurance industry. The results of the study show that the social and regulatory factors played crucial role in the consumer’s decision in purchasing insurance. However it was also found that the public at large is unaware about the benefits of insurance, and various types of insurance products. The insurance companies shall focus of promotional marketing strategies. The marketer’s primary focus should be on promotional activities.

1

Garg ,M.C.& Verma A.2010. An empirical analysis of the marketing mix in the Life Insurance Industry In India.The IUP journal of management research .Vol.9.pp07-20. 2 Abdalelah S. Saaty A 2011. Factors Critical in Marketing Strategies of Insurance Companies in Saudi Arabia. The International Journal of Marketing Studies. Vol.3.pp104-122.

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Literature no. 3 A study by D’Andrea & Schleicher(2006)3. Attempts to understand the role of promotions among other key drivers at determining consumer’s overall store price image (OSPI) of grocery stores in Latin America, identifying its relative importance. Pricing is a relevant issue to customers as well as for retailers. However, this research shows that price promotions and its advertisement may blur the consumer’s possibilities of identifying which retailer runs the best prices and minimizes their overall purchasing cost. At the same time, it makes harder to the retailer to find which factors are more effective in forming the overall store price image (OSPI). Further understanding of how OSPI is built seems necessary in order to help retailers make the right decisions that will not confuse consumers. However, a review of the literature shows that most of the studies have concentrated at the product level, or have considered isolated variables. Our research was then set for understanding the relative importance of the different factors that form the OSPI, and consider the differences towards price promotions across consumer segments and markets. Literature no. 4 A study by Pulidindi Venugopal(2010)4. Attempts to understand the attitude of insured on agents and promotional activities of life insurance companies Life Insurance is conceptual and intangible in its nature and it is not understood by majority of the Indian population. Even though every insurer knows that it is not bought and it has to be sold, there is a lot of gap among promotional activities and advisors (agents). Hence it caused complications in marketing its products. Making the uneducated, rural and economically backward people to understand the insurance concept is a challenging task. Insurers may succeed if they develop separate strategies for each segment. Promotional activities and agents of life insurance companies is all about to inform, bringing awareness, develop belief, to reinforce trust etc. in the minds of the consumers by using tools such as advertising, public relations, displays, word of mouth, sales promotion, personal selling etc. Promotion bring positive attitude or may cause negative attitude so knowing the feelings of respondents found essential. Today customers 3

D’Andrea & Schleicher A 2006. The role of promotions and other factors affecting overall store price image in Latin America. The International Journal of Retail & Distribution Management Vol. 34 No. 9, 2006 pp. 688-700. 4 P Venugopal A 2010. Attitude of Insured on Agents and Promotional Activities of Life Insurance Companies. Drishtikon: A Management Journal Vol. 1 no. 2. 2010 pp. 369-394.

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are more informed with number of options, even still majority of the customers trusts only LIC. Therefore it is the duty of all insurers to study the attitudes of customers on their agents and promotional activities to reinforce trust in the customers. Literature no. 5 A study by Beenish Shameem & Dr Sameer Gupta(2012)5. The study is designed to evaluate the marketing strategies in life insurance service sector & how these strategies boost sales & marketability of a product which ultimately lead to customer satisfaction. The insurance scenario faces multiple challenges such as increased costs of operation, regulatory pressures, and inflexible technology infrastructure. These pressures are compounded by low to moderate premium growth & the increasing burdens of regulatory compliance. Keeping all the above problems around the study would attempt to study all the factors that contributed to the effective marketing strategies. This paper presents different marketing strategies that are taken up in life insurance services keeping in view external and internal environment of the firm. Marketing strategy is the basic approach that the business units will use to achieve its objectives, and it consists of broad decisions on target markets, market positioning and mix, and marketing expenditure levels.

5

Shameem B. & Dr. Gupta A 2012. Marketing Strategies In Life Insurance Services. International Journal of Marketing, Financial Services & Management Research Vol.1 Issue 11,November2012 pp132-141

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II.

CHAPTER

INDUSTRY PROFILE INTRODUCTION TO INSURANCE INDUSTRY: Insurance is a form of risk management that shields insured from the risk of any uncertain of unfortunate events. In simple terms insurance can be defined as transfer of risk from one entity to another in exchange of the payment. The transaction consists of insured assuming a guaranteed small loss in the form of payment to the insurer in exchange of the promise to compensate insured in case of any kind of financial loss to insured. In a layman’s term, insurance is a guard against monetary loss arising on the happening of an unforeseen event. In developing countries like India insurance sector still holds lot of potential which need to be tapped. TYPES OF INSURANCE: Insurance can be classified into three categories: 1. Life Insurance: Life Insurance is a concord between the insurer and the policyholder, where insurer promises to pay beneficiary designated sum of money upon death of the insured person. Life Insurance covers number of contingencies like Death, Disability, and Disease. 2. General Insurance: General Insurance is a non-life insurance policy including automobile and homeowner policy. General insurance specifically consist of non- life insurance. It includes property insurance, liability insurance and other forms of insurance. Fire and Marine insurance are called property insurance. 3. Social Insurance: Social insurance is another type of insurance for weaker section of the society. It provides protection to weaker section of the society who are unable to pay premium. Industrial Insurance, sickness insurance, pension plan, disability benefits, unemployment benefits are some the type of social insurance.

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INSURANCE SECTOR IN INDIA: Indian insurance sector has gone through different phases of competition, from being an open competitive market to a nationalized market and then again getting back to liberalized market. Indian insurance sector has witnessed complete dynamism in past few centuries. Insurance sector in India has a deep- rooted history. Its mention has been found in writings of Manu (Manusmriti), Yagnavalkya (dharmashastra) and Kautilya (Arthshastra). Ancient Indian history has preserved traces of insurance in the form of marine trade loans and carrier contracts. Insurance industry in India is governed by Insurance Act of 1938, Life Insurance Corporation Act of 1956 and General Insurance business Act, 1972, Insurance Regulatory and Development Authority (IRDA) Act of 1999 and other related acts. Insurance industry in India is considered as an industry with big potential market. One of the reason that India is seen as huge potential market is because of its huge population and untapped market area of this population. In terms of population India has an immense potential expanding their life insurance cover. Majority of people in India are unaware of the functions and benefits of Insurance because of which insurance sector has a bright future in India. But it is relevant to consider factors like different varieties of social structure, urban and rural composition other than very important factors like age, sex, income level, literacy level. Making assessment of Life Insurance potential of India is very difficult task due to wide variance in every aspect of Indian circumstances and without a refined

analysis

any

estimate

would

be

meaningless.

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INDIAN INSURANCE INDUSTRY AT PRESENT: Life Insurance Corporation (LIC) had the monopoly over the market till the late 90’s when the insurance sector in India was opened for private players. Before that there were only two state insurer, one was LIC (Life Insurance Corporation of India) and GIC (General Insurance corporation of India). Indian insurance sector at present has undergone many structural changes in 2000. The Government of India has liberalized the insurance sector in 2000 with IRDA (Insurance Regulatory and development authority) lifting all entry restriction of foreign players with a specific limit on direct foreign ownership. Under the current guideline 26% of equity cap is there for foreign players in an insurance company and proposal is being given to increase this limit to 49%. Post liberalization insurance industry in India have come a long way and today it stands as one of the most competitive, challenging and exploring industry in India. Increased use of new distribution channels are in limelight today due to entry of private players. In the long run the use of these distribution channels and modern IT tools has increased scope of the insurance industry. Also the changing economics patterns, changing political scenario, modern IT tools will eventually help in reshaping future of Indian financial market and Life Insurance business in the country. REGULATORY ISSUES: Insurance Regulatory and Development Authority (IRDA) is a national agency of government of India. It was formed by an act of Indian Parliament known as IRDA Act 1999 which was amended in 2002 to incorporate some upcoming requirement. It is responsible for protecting the interest of policy holders, to regulate and promote orderly growth of Insurance Industry in India. To achieve this objective IRDA has taken following steps: 1. IRDA has notified protection of policyholders Interest Regulation 2001 to provide for: policy proposal document is in easily understandable language; claims procedure in both life and non-life; setting up grievance redress machinery; speedy settlement of claims and policy holders servicing. The regulation also provides for payment of interest by insurer for delay in settlement of claims. 2. Solvency margins are to be maintained by the insurer so that they can be in a position to meet their obligation towards the policyholder with respect to payment of claims.

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3. The Insurance Company has to clearly disclose the benefits, terms and condition under the policy. 4. The advertisement issued by the insurer should not mislead the insuring public. 5. Proper grievance redress machinery should be set up in the head office and all the other offices by the insurer. 6.

If any complaints are received by the policyholder with respect to the services provided by the insurer under the insurance contact, then the authority takes up with the insurer.

7. Insurer has to maintain separate account related to the fund of Policyholder. The funds of the policyholder should be retained within the country. 8. According to the new regime, Insurance companies will have to exposure to rural and social sector.

CRITICAL SUCCESS FACTORS: Post Liberalization Insurance industry in India has become very competitive. With private players entering into the India market making the market lot more competitive. Insurance industry in India has become highly competitive with different companies and individual agents competing against each other to gain higher market share. In order to gain higher market share companies have to differentiate themselves from others. Companies can differentiate themselves in the market by using a number of critical success factors:

1. Product Quality: One the most important factor that differentiates companies is by the quality of product it offers. Quality of product instills a confidence in the customer that the product offered by the company is better. Better the quality of product, more successful is the company. 2. Developing relationships with the customer: Insurance Industry is a highly competitive industry. In order to gain the market share first priority is to be given to the customer. Range of product and services should be designed to give the customer what he desires. 3. Market Segmentation:

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Greater market segmentation should be done in which target audience should be divided into homogenous groups and products and services should be targeted towards such market. This would tie company to their client by customized combination of coverage, easy payment plan, risk management advice and quick claim handling. 4. Designing new strategies: Insurance Industry cannot be satisfied with consolidation of their existing market, but have to achieve future growth and penetration. Companies must focus on new distribution channels, strengthening their existing point of services, direct contact with their ultimate customer, refresh their marketing setup, new comers should focus on tapping the market which is left unexploited by public sector companies. 5. Shift towards Rural market: Rural market is India is still uncovered by this sector. Insurance penetration can be achieved by tapping the untapped rural market of India. 6. Motivating sales force: Sales force is one the major strength that the company has that could differentiate them from their competitors. A good sales force can do wonders to the future of the company, because of which a proper motivation of sales force is very important for the company. Life Insurance Company should constantly involve in motivating their sales force so that they can meet their target on time. 7. Use of technology: Technology plays a very important role in the success of the company. Internet based Life insurance will help companies to reduce time and transaction cost and also improves quality of services to its customer. DOMESTIC ECONOMIC CONDITIONS: Domestic economic conditions play a major role in growth or downfall of an Insurance company, No matter how financially stable an insurer is; none is immune to the slow economic growth. In an Indian economy double digit inflation is one the uncomfortable factor and RBI which is the central bank of India has a huge task of controlling the inflation without hampering the economic growth. Tradeoff between Interest rates and Inflation has been the core the business of the RBI and the past one year has been very difficult for the RBI. In an attempt to

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manage inflation, RBI has been constantly raising repo rate and reverse-repo rates every quarter but it has not succeeded in moderating inflation. This simply implies that inflation is more of a supply side issue than a monetary implication. The implications of this relatively high interest rates and high inflation regime are unlikely to be positive for insurance industry. It would be difficult for an Insurance industry to manage return expectations as they are likely to be high. While competing with a fixed income product higher assured returns are required for high. Interest rates in order to increase penetration. There may be some reductions in actual growth rates, but Indian’s long term fundamentals remain intact as life Insurance being an industry with long time horizon, it would be able to tide over economic cycle. Inflation on the other hand means lower disposal incomes in the hand of the consumer leading to lower household savings which currently stands at 34.7%, though significantly lower than china which is 50%.

GLOBAL ECONOMIC ENVIRONMENT: According to the Swiss Re’s newly appointed Economist, Kurl Karl low interest rates and euro debt crisis will prove to be a problem for insurance industry. According to Kurt karl momentum of growth has been slowed down due to this two factors, but the only bright spot according to him is the ongoing growth in the emerging market. However Kurl is lot more optimistic looking forward to 2013 forecasting a pick-up in investment yield and premium in a modest improvement in economic conditions. 1. Political Development: Political developments are the more serious threat in Europe and US. In Europe this can lead to serious sovereign defaults and also exit from the euro monetary union. 2. Emerging markets has been negatively impacted by faltering growth in the developed economy. Also tighter monetary policies on the part of several emerging economies also slowed down growth. 3. Both global in-force and new business life insurance fell in 2011, but it again recovered. According to the economist in order to return to the pre-crisis profitability short- term factors like low investment returns, high hedging cost and more onerous

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capital requirement. Life Insurance industry’s capitalization has improved markedly and it is in the better shape to cope up with the future challenges. 4. Because of some Regulatory changes in China and India, coming two years will see life insurance business in emerging market returning to its long term trend of around 8%.

DEMAND DRIVERS: Insurance industry in India has become lot more competitive in recent years. With private players entering into the market, competition level has significantly increased with more private players trying to gain more market share. Some of the demand drivers that give change to the smaller companies to compete against giants like Life Insurance Corporation of India Ltd (LIC) which has 70% market share are: 1. Rural market: According to the Mckinsey report, titled India Insurance 2012: Fortune Favors the Bold, finds that the sector is still in a dissident with different players in different stage of development and market presence. According to the Mckinsey’s report the rural penetration is likely to increase from about 25% at present to around 35-40% in 2012. With 65% of the Life insurance coming from rich urban class, smaller companies can look for rural and low income group as potential demand driver. 2. Product Mix; A better product mix would also drive growth of insurance companies, with companies making a move to lower the share of single premium products. Life insurance product can also fill the gap that is created by growing demand for investment products and long-term savings. CHALLENGES FACING INSURANCE INDUSTRY: Threat of New Entrants: The insurance industry has been budding with new entrants every other day. Therefore the companies should carve out niche areas such that the threat of new entrants might not be a hindrance. There is also a chance that the big players might squeeze the small new entrants.

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Power of Suppliers: Those who are supplying the capital are not that big a threat. For instance, if someone as a very talented insurance underwriter is presently working for a small insurance company, there exists a chance that any big player willing to enter the insurance industry might entice that person off. Power of Buyers: No individual is a big threat to the insurance industry and big corporate houses have a lot more negotiating capability with the insurance companies. Big corporate clients like airlines and pharmaceutical companies pay millions of dollars every year in premiums. Availability of Substitutes: There exist a lot of substitutes in the insurance industry. Majorly, the large insurance companies provide similar kinds of services – be it auto, home, commercial, health or life insurance. With the size of world's population reaching gigantic proportions, global insurance is also gaining in stature. Private as well government insurance agencies around the world are running for insuring lives of millions (and in the process insuring their own businesses more). In fact, the insurance industry is a key component of the world economy today owing to its premiums, its investment and, above all, the social and economic role it plays in covering personal and business risks.

FINANCIAL VIABILITY OF INSURANCE COMPANIES: However, although the insurance industry is a flourishing in world economy today, one need to keep in mind that financial viability/stability of the insurance company is a major consideration at the time of purchasing insurance contract. The viability factor is important because many a times, an insurance premium paid currently provides coverage for losses in distant future and there are instances where a number of insurance companies have gone insolvent, thus leaving their policyholders with little helpful or no coverage. Therefore, even if the global industry is strengthening more and more, the weak links are also co-existent and blind faith can lead to a severe downfall. There are also independent rating agencies for insurance companies which could be helpful in providing sound information on financial viability of various insurance companies.

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MARKETING IN INSURANCE: Insurance comes under the service sector and while marketing this service, due care is to be taken in quality product and customer satisfaction. While marketing the services, it is also pertinent that they think about the innovative promotional measures. It is not sufficient that you perform well but it is also important that you let others know about the quality of your positive contributions. The creativity in the promotional measures is the need of the hour. The advertisement, public relations, word of mouth communication needs due care and personal selling requires intensive care. There are insurance marketing strategies that can take any insurance agency from mediocre to success when utilized correctly. Hence it is necessary that an insurance company formulize their marketing strategies with lot of thought and diligence to capture the untapped potential in the insurance industry. Through this project we aim to understand the strategies adopted by IDBI Federal and to find out the effectiveness of these promotional strategies through a study on consumer behaviour.

PRESENT SCENARIO OF INSURANCE INDUSTRY: The brief outlook about the regulatory changes done by the Indian Government over the years is given below:-

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The effect of insurance reforms has been positive on the insurance industry. There has been positive growth in all the segments, with investments flowing in the right direction. Reforms have helped to achieve rapid growth in critical areas and sustain them over a period of time through channelized strategies. Post reforms, the number of players have increased from 4 to 24 players presently registered under IRDA (INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY OF INDIA).

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COMPETITOR ANALYSIS Competitor analysis in marketing and strategic management is a judgment of strength and weakness of the competitors. Companies generally do this analysis to understand the strength and weakness of their current and potential competitors. This analysis provides both offensive and defensive strategy to identify both opportunity and threats. IDBI federal Life Insurance is one of emerging insurance company. It is one of the few companies that have shown rapid growth since the day of its inception. In order to gain higher market Share Company has to understand its competitors that is their strength and weakness .Competitor analysis will help IDBI to understand strength and weakness of their competitors. This analysis will help IDBI to come up with offensive or defensive strategy to identify both opportunity and threats. Some of the main competitors of IDBI federal are: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19.

AEGON Religare Life Insurance Shriram Life Insurance Bajaj Allianz Life Insurance Bharti AXA Life Insurance Co Ltd Birla Sun Life Insurance DLF Pramerica Life Insurance HDFC Standard Life Insurance Company Limited ICICI Prudential ING Vysya Life Insurance Kotak Life Insurance Max Life Insurance PNB MetLife India Life Insurance Reliance Life Insurance Company Limited Sahara Life Insurance SBI Life Insurance Company Limited TATA AIA Life Insurance Oriental insurance company National insurance company limited United India insurance company limited

1. Life Insurance Corporation of India ( LIC): 20 | P a g e

LIC was founded in 1956 with the merger of 243 insurance company and provident societies. It is the largest insurance and investment company in India. It is a state owned with 100% stake owned by government of India. Products offered by LIC are: 1. Jeevan Arogya plan: Jeevan arogya plan is a unique non-linked health insurance plan which provides health insurance against certain specified health risk. LIC’s jeevan arogya plan is a direct competition to IDBI’s Healthsurance plan. 2. Bima Account plan: Under this plan the premiums payed by the customer after deduction of all charges, will be credited to the policyholders account maintained separately for each policyholder. If all premiums are paid the amount held in policyholder’s account will earn an annual interest rate of 6% p.a 3. Endowment plan: It’s a unit linked endowment plan which offers investment cum insurance cover during the term of the policy. 4. Children Plans 5. Plan for Handicapped Dependents 6. Endowment assurance plans 7. Plans for high worth Individual 8. Money Back Plans 9. Special Money Back Plan for Women 10. Whole Life Plans 11. Term assurance plans 12. Joint Life Plan 1.1 SWOT Analysis of LIC: SWOT Analysis is a strategic planning method used to analyze strength, weakness, opportunity and threat involved in a business or a project. 1. Strength:  LIC is India’s largest state-owned company and also India’s largest investors  LIC has over 20000 branches all across India and more than 1, 00,000 agents.  LIC is the largest investor in India with largest fund base.  LIC has over 1, 15,000 employees across India.  LIC is the 8th most trusted brand of India.  LIC has subsidiaries like LIC card services Ltd, LIC Housing finance Ltd, LIC Nomura mutual fund. 2. Weakness:  It lacks imagination since it has an image of a government company  Red tape, bureaucracy causes the problem since it is a government company.  During the economic crises managing a he workforce is a lot of burden.

2. ICICI Prudential: ICICI prudential Life Insurance Company is the joint venture of ICICI bank and Prudential Plc, one of the leading financial service groups in UK. 21 | P a g e

Products offered by ICICI prudential: 1. ICICI pru care: It is an insurance plan that protects family’s future and ensures they lead their life comfortably. 2. Save n Protect 3. Cash back 4. Home Assure 5. Life Guard 6. ICICI pru iprotect 7. Smartkid Regular premium 8. ICICI pru Elite Life 9. Group term insurance plan 10. Group Gratuity plan 11. Annuity solution 12. ICICI pru life link pension SP 13. Forever Life 14. Immediate annuity 15. ICICI pru heath saver 16. ICICI pru Hospital care 17. ICICI pru crisis cover 18. ICICI pru Mediassure SWOT Analysis of ICICI prudential: STRENGTHS: 1.Strong tie up 2.Brand Equity 3.Strong network 4.Huge customer database 5.Strong financial base OPPORTUNITIES: 1.Untouched Rural market 2.Large Uninsured population 3.Network Building

Weaknesses: 1.Low customer awareness 2.Less promotion 3.Untouched Rural Population

Threats: 1.Competitors 2.Customer beliefs in LIC 3.Fast turnover of employees

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MARKET SHARE

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COMPANY PROFILE

ABOUT IDBI FEDERAL LIFE INSURANCE: IDBI Federal Life Insurance Co Ltd. is a joint-venture of IDBI Bank, India's premier development and commercial bank, Federal Bank, one of India's leading private sector banks and Ageas, a multinational insurance giant based out of Europe. In this venture, IDBI Bank owns 48% equity while Federal Bank and Ageas own 26% equity each. Having started in March 2008, in just five months of inception, IDBI Federal became one of the fastest growing new insurance companies by garnering Rs.100 Cr in premiums. Through a continuous process of innovation in product and service delivery IDBI Federal aims to deliver world-class wealth management, protection and retirement solutions that provide value and convenience to the Indian customer. The company offers its services through a vast nationwide network 2,308 partner bank branches of IDBI Bank and Federal Bank in addition to a sizeable network of advisors and partners. As on 31st December 2013, the company has issued nearly 5.5 lakh policies with a sum assured of over Rs. 32,110.48 crores. About the sponsors of IDBI Federal Life Insurance Co Ltd IDBI Bank Ltd. continues to be, since its inception, India's premier industrial development bank. It came into being as on July 01, 1964 to support India's industrial backbone. Today, it is amongst India's foremost commercial banks, with a wide range of innovative products and services, serving retail and corporate customers in all corners of the country from 1201 branches and 2156 ATMs. The Bank offers its customers an extensive range of diversified services including project finance, term lending, working capital facilities, lease finance, venture capital, loan syndication, corporate advisory services and legal and technical advisory services to its corporate clients as well as mortgages and personal loans to its retail clients. As part of its development activities, IDBI Bank has been instrumental in sponsoring the development of key institutions involved in India's financial sector - National Stock Exchange of India Limited

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(NSE) and National Securities Depository Ltd, SHCIL (Stock Holding Corporation of India Ltd), CARE (Credit Analysis and Research Ltd). Federal Bank is one of India's leading private sector banks, with a dominant presence in the state of Kerala. It has a strong network of over 1,142 branches and 1,312 ATMs spread across India. The bank provides over four million retail customers with a wide variety of financial products. Federal Bank is one of the first large Indian banks to have an entirely automated and interconnected branch network. In addition to interconnected branches and ATMs, the Bank has a wide range of services like Internet Banking, Mobile Banking, Tele Banking, Any Where Banking, debit cards, online bill payment and call centre facilities to offer round the clock banking convenience to its customers. The Bank has been a pioneer in providing innovative technological solutions to its customers and the Bank has won several awards and recommendations. Ageas is an international insurance group with a heritage spanning more than 180 years. Ranked among the top 20 insurance companies in Europe, Ageas has chosen to concentrate its business activities in Europe and Asia, which together make up the largest share of the global insurance market. These are grouped around four segments: Belgium, United Kingdom, Continental Europe and Asia and served through a combination of wholly owned subsidiaries and partnerships with strong financial institutions and key distributors around the world. Ageas operates successful partnerships in Belgium, UK, Luxembourg, Italy, Portugal, Turkey, China, Malaysia, India and Thailand and has subsidiaries in France, Hong Kong and UK. Ageas is the market leader in Belgium for individual life and employee benefits, as well as a leading non-life player through AG Insurance. In the UK, Ageas has a strong presence as the fourth largest player in private car insurance and the over 50's market. Ageas employs more than 13,000 people and has annual inflows of more than EUR 21 billion.

VISION, MISSION AND VALUES Vision of the company To be the leading provider of wealth management, protection and retirement solutions that meets the needs of our customers and adds value to their lives.

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Mission of the company To continually strive to enhance customer experience through innovative product offerings, dedicated relationship management and superior service delivery while striving to interact with our customers in the most convenient and cost effective manner. To be transparent in the way we deal with our customers and to act with integrity. To invest in and build quality human capital in order to achieve our mission. Values of the company 

Transparency: Crystal Clear communication to our partners and stakeholders

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Value to Customers: A product and service offering in which customers perceive value

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Rock Solid and Delivery on Promise: This translates into being financially strong, operationally robust and having clarity in claims

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Customer-friendly: Advice and support in working with customers and partners

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Profit to Stakeholders: Balance the interests of customers, partners, employees, shareholders and the community at large

ORGANIZATION STRUCTURE

CEO VIGNESH SHAHANE

Marketing & Promotion

Under writing

Finance

Human Resour ce

North Zonal Support Manager

East Zonal Support Manager

South Zonal Support Manager

West Zonal Support Manager

Product

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PRODUCTS OF IDBI FEDERAL At IDBI Federal, it’s our constant endeavour to create innovations that create value for our customers. These innovations are brought to life through our wide array of products that fit the varying financial and investment needs at different stages of life. 

LIFESURANCE



CHILDSURANCE



INCOMESURANCE



TERMSURANCE



WEALTHSURANCE



LOANSURANCE



MICROSURANCE

LIFESURANCE: Often, the first step towards a long and arduous journey is the toughest. However, once you have taken that first stride, the rest of the journey seems easier and more enjoyable. With your investments, it is the same approach that will ensure you build the right corpus to fulfil your dreams for yourself and your family – start small, save big! HOW IT WORKS

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CHILDSURANCE: Whether your child wants to be a doctor, an engineer, an MBA, a sportsman, a performing artist, or dreams of being an entrepreneur, the IDBI Federal Childsurance Dream builder Insurance Plan will keep you future-ready against both, changing dreams and life’s twists. It allows you to create build and manage wealth by providing several choices and great flexibility so that your plan meets your specific needs. However, what makes Childsurance a must-have for any parent who is looking to make their child’s future shock-proof is its powerful insurance benefits. Childsurance allows you to protect your child plan with triple insurance benefits so that your wealth-building efforts remain unaffected by unforeseen events and your child’s future goals can be achieved without any hindrance. HOW IT WORKS This second illustration below explains how the product works for a limited premium policy with a policy term of 20 years.

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INCOMESURANCE: IDBI Federal Incomesurance Endowment and Money Back Plan is loaded with lots of benefits which ensure that you get Guaranteed Annual Payout along with insurance protection which will help you to reach you goals with full confidence. Incomesurance Plan is very flexible and allows you to customise your Plan as per your individual and family’s future requirements. Moreover it also allows you to choose Premium Payment Period, Payout Period, Payout Options and more. HOW IT WORKS

Age

Pay-out

Age

Pay-out

18-30

138%

47

131%

31-36

137%

48

131%

37-39

136%

49

130%

40

135%

50

130%

41

135%

51

130%

42

134%

52

128%

43

134%

53

128%

44

133%

54

127%

45

133%

55

126%

46

132%

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SWOT ANALYSIS OF IDBI FEDERAL LIFE SWOT analysis of IDBI Federal Life Insurance represents analysing strength, weakness, opportunities, and threat of the company which are as follows:Strength:

The major strength of IDBI Federal Life is its sponsor companies which are IDBI bank, Federal bank and Fortis. Because of its innovative ideas it is the first insurance company to collect 100cr within five months of its commencement of business. One major strength of IDBI Federal is its combined network of more than 1600 branches of IDBI bank and Federal bank.

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Superior customer service with huge network and innovative products

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High level of customer (both internal & external) satisfaction because of its management policy.

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Large pool of technically skilled workforce with deep knowledge of insurance market.

Weakness:

The major weakness of IDBI Federal is the constraint sectorial growth due to low unemployment level.

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Low confidence of people in private insurance company.

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The corporate clients under group schemes and salary savings schemes are captured by other major players.

Opportunities:

Only 10% of Indian population is covered by insurance policy out of 30% insurable population.

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Due to liberalization it can operate globally.

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Fast track carrier development opportunities on an industrial wide basis.

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After liberalization it is expected that insurance business is roughly 400 billion rupees per year now which shows big opportunities and market for IDBI Federal Life Insurance.

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

The existing LIC and GIC, have created a large group of dissatisfied customers due to the poor quality of service. Hence there will be shift of large number of customers for other players.

Threats:

Big public insurance companies like LIC, National Insurance Companies Limited, Oriental Life Insurance etc. are the biggest threats to IDBI Federal Life Insurance. Large potential market attracts new rivals.

CUSTOMERS Insurance industry has the specialty of targeting every individual who is earning the only constraint is the perception of the customer toward the insurance company. The customers for IDBI Federal Life Insurance Co Ltd are the age group of 25-45(mainly) and children for child insurance product aged from 3months to 17 years.

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III.

CHAPTER

THEORETICAL ASPECT RELATED TO TOPIC OF THE STUDY A. Marketing Mix at IDBI Federal Life Insurance The term insurance marketing refers to the marketing of Insurance services with the aim to create customer and generate profit through customer satisfaction. The Insurance Marketing focuses on the formulation of an ideal mix for Insurance business so that the Insurance organization survives and thrives in the right perspective. The marketing mix is the combination of marketing activities that an organization engages in so as to best meet the needs of its targeted market. The Insurance business deals in selling services and therefore due weight age in the formation of marketing mix for the Insurance business is needed. The marketing mix includes sub-mixes of the 7 P’s of marketing i.e. the product, its price, place, promotion, people, process & physical attraction. The above mentioned 7 P’s can be used for marketing of Insurance products, in the following manner:

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1 - PRODUCT: A product means what we produce. If we produce goods, it means tangible product and when we produce or generate services, it means intangible service product. A product is both what a seller has to sell and a buyer has to buy. Thus, an Insurance company sells services and therefore services are their product. When a person or an organization buys an Insurance policy from the insurance company, he not only buys a policy, but along with it the assistance and advice of the agent, the prestige of the insurance company and the facilities of claims and compensation. It is natural that the users expect a reasonable return for their investment and the insurance companies want to maximize their profitability. Hence, while deciding the product portfolio or the product-mix, the services or the schemes should be motivational. IDBI Federal provides many products which caters to the needs of the Indian customers. IDBI Federal products:-



CHILDSURANCE



GROUP MICROSURANCE



INCOMESURANCE



LIFESURANCE



LOANSURANCE



TERMSURANCE



WEALTHSURANCE

CHILDSURANCE Whether your child wants to be a doctor, an engineer, an MBA, a sportsman, a performing artist, or dreams of being an entrepreneur, the IDBI Federal Childsurance Dream builder Insurance Plan will keep you future-ready against both, changing dreams and life’s twists. It allows you to create build and manage wealth by providing several choices and great flexibility so that your plan meets your specific needs. However, what makes Childsurance a must-have for any parent who is looking to make their child’s future shock-proof is its powerful insurance benefits. Childsurance allows you to protect your child plan with triple insurance

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benefits so that your wealth-building efforts remain unaffected by unforeseen events and your child’s future goals can be achieved without any hindrance.

INCOMESURANCE IDBI Federal Incomesurance Endowment and Money Back Plan is loaded with lots of benefits which ensure that you get Guaranteed Annual Payout along with insurance protection which will help you to reach you goals with full confidence. Incomesurance Plan is very flexible and allows you to customise your Plan as per your individual and family’s future requirements. Moreover it also allows you to choose Premium Payment Period, Payout Period, Payout Options and more.

LIFESURANCE IDBI Federal Lifesurance Savings Insurance Plan is a fixed term non-linked participating plan that provides you the twin benefits of long-term savings and life cover. With Lifesurance Savings, your small savings will help you realise the big dreams that you have for yourself and your family. This plan also offers you the benefit of life cover that will provide financial security to your family in your absence. Despite all these tailored products there is still scope for improvement in this field. The Group Insurance scheme is required to be promoted, the Crop Insurance is required to be expanded and the new schemes and policies for the villagers or the rural population are to be included. . The introduction of Rural Career Agents Scheme has been found instrumental in inducing the rural prospects but the process is at infant stage and requires more professional excellence. So there is lot of potential in insurance sector which is waiting to be uncorked hence revealing to the economy the benefits of insurance industry. The policymakers are required to activate the efforts. It would be prudent that the LIC is allowed to pursue a policy of direct investment for rural development. Investment in Government securities should be stopped and the investment should be channelized in private sector for maximizing profits. In short, the formulation of product-mix should be in the face of innovative product strategy. While initiating

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the innovative process it is necessary to take into consideration the strategies adopted by private and foreign insurance companies.

2 – PLACE: This component of the marketing mix is related to two important facets  Managing the insurance personnel, and  Locating a branch. The management of agents and insurance personnel is found significant with the viewpoint of maintaining the norms for offering the services. This is also to process the services to the end user in such a way that a gap between the services- promised and services offered is bridged over. In a majority of the service generating organizations, such a gap is found existent which has been instrumental in making worse the image problem. The transformation of potential policyholders to the actual policyholders is a difficult task that depends upon the professional excellence of the personnel. The agents and the rural career agents acting as a link, lack professionalism. The frontline staff and the branch managers also are found not assigning due weight age to the degeneration process. The insurance personnel if not managed properly would make all efforts insensitive. Even if the policy makers make provision for the quality up gradation, the promised services hardly reach to the end users. It is also essential that they have rural orientation and are well aware of the lifestyles of the prospects or users. They are required to be given adequate incentives to show their excellence. While recruiting agents, the branch managers need to prefer local persons and provide them training and conduct seminars. In addition to the agents, the front-line staff also needs an intensive training programmed to focus mainly on behavioural management. Another important dimension to the Place Mix is related to the location of the insurance branches. While locating branches, the branch manager needs to consider a number of factors, such as smooth accessibility, availability of infrastructural facilities and the management of branch offices and premises. In addition it is also significant to provide safety measures and also factors like office furnishing, civic amenities and facilities, parking facilities and interior office decoration should be given proper attention.

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Thus the place management of insurance branch offices needs a new vision, distinct approach and an innovative style. This is essential to make the work place conducive, attractive and proactive for the generation of efficiency among employees. The branch managers need professional excellence to make place decisions productive. IDBI Federal has around thousands and thousands of insurance agents all over India to manage their regional customers effectively. Also, IDBI Federal has over 1201 branches all over India which help in increasing their customer base.

3 - PRICING: In the insurance business the pricing decisions are concerned with: i) The premium charged against the policies ii) Interest charged for defaulting the payment of premium and credit facility, and iii) Commission charged for underwriting and consultancy activities. With a view of influencing the target market or prospects the formulation of pricing strategy becomes significant. In a developing country like India where the disposable income in the hands of prospects is low, the pricing decision also governs the transformation of potential policyholders into actual policyholders. The strategies may be high or low pricing keeping in view the level or standard of customers or the policyholders. The pricing in insurance is in the form of premium rates. The three main factors used for determining the premium rates under a life insurance plan are mortality, expense and interest. The premium rates are revised if there are any significant changes in any of these factors.  Mortality (deaths in a particular area): When deciding upon the pricing strategy the average rate of mortality is one of the main considerations. In a country like South Africa the threat to life is very important as it is played by host of diseases.  Expenses: The cost of processing, commission to agents, reinsurance companies as well as registration are all incorporated into the cost of instalments and premium sum and forms the integral part of the pricing strategy.  Interest: The rate of interest is one of the major factors which determine people’s willingness to invest in insurance. People would not be willing to put their funds to

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invest in insurance business if the interest rates provided by the banks or other financial instruments are much greater than the perceived returns from the insurance premiums.

4 - PROMOTION: The insurance services depend on effective promotional measures. In a country like India, the rate of illiteracy is very high and the rural economy has dominance in the national economy. It is essential to have both personal and impersonal promotion strategies. In promoting insurance business, the agents and the rural career agents play an important role. Due attention should be given in selecting the promotional tools for agents and rural career agents and even for the branch managers and front line staff. They also have to be given proper training in order to create impulse buying. Advertising and Publicity, organization of conferences and seminars, incentive to policyholders are impersonal communication. Arranging Kirtans, exhibitions, participation in fairs and festivals, rural wall paintings and publicity drive through the mobile publicity van units would be effective in creating the impulse buying and the rural prospects would be easily transformed into actual policyholders. IDBI Federal has also adopted various promotional strategies like:  Commercial Ads  Print Ads  Events  Personnel selling  Word of mouth  Viral marketing They have brought out many interesting and humorous ads of their products such as Lifesurance, Incomesurance, Childsurance etc which has got very good response from customers. They have also conducted events with an aim to create interest around financial planning with Life Insurance at branches which was critical to getting prospects interested in IDBI Federal products. Building an engagement process around the solution being offered gives an additional boost to this cause. Spelling Bee was a specially created spelling contest created to connect with children. The philosophy of this module hinged around making learning fun. The event was timed to coincide with Children’s day in November 2010. The spellings to be completed

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revolved around visual and verbal cues to words related to saving, money and finance and aimed at teaching children the value of money early in life. The engagement started with the spelling contest for kids and gave their IRMs a natural opening for a discussion with parents about financial planning for their children’s future needs like education. This is a sort of channel marketing which IDBI Federal had adopted to create awareness as well as to educate the future generation about the company and the importance of saving. Also IDBI Federal involved them in developing their business by joining hands with SAMHITA, a community development organization based out of Bhopal which works towards bringing financial literacy to the underprivileged population in Madhya Pradesh. They believe that such financial literacy among the under banked population will help bring a holistic change in the way people perceive and understand financial products and their utility at various stages in their life. This will ultimately help bring them closer to financial inclusion. They started this journey with SAMHITA in 2008 by providing low cost group coverage female members of SAMHITA under Group Microsurance. This way they have covered 86,721 lives for a sum assured of Rs. 66.7 crores since then. They also offer the protection of Termsurance Grameen Suraksha to the family members of these people. IDBI Federal Termsurance Grameen Suraksha is especially designed to make life insurance affordable to rural customers with options of four convenient premium slabs of Rs 49.08, Rs 98.17, Rs 147.25 and Rs 196.33 (inclusive of taxes) with corresponding sums assured of Rs 5,000, Rs 10,000, Rs 15,000 and Rs 20,000. In this way IDBI Federal has made intelligent moves to capture the rural market which has lot of potential and promise in the future. Promotional strategies are very important for any intangible product especially like life insurance and financial savings where people should be given complete education about such products because of which all insurance companies take due care while formulizing their promotional strategies.

5 – PEOPLE: Understanding the customer better allows in designing appropriate products. Being a service industry which involves a high level of people interaction, it is very important to use this 38 | P a g e

resource efficiently in order to satisfy customers. Training, development and strong relationships with intermediaries are the key areas to be kept under consideration. Training the employees, use of IT for efficiency, both at the staff and agent level, is one of the important areas to look into. IDBI Federal has created various financial products which have been tailored according to the needs of the customers. They have over thousands of sales personnel who are trained efficiently to bridge in the gap between the customers and the company.

6 - PROCESS: The process should be customer friendly in insurance industry. The speed and accuracy of payment is of great importance. The processing method should be easy and convenient to the customers. Instalment schemes should be streamlined to cater to the ever growing demands of the customers. IT & Data Warehousing will smoothen the process flow. IT will help in servicing large number of customers efficiently and bring down overheads. Technology can either complement or supplement the channels of distribution cost effectively. It can also help to improve customer service levels. The use of data warehousing management and mining will help to find out the profitability and potential of various customers product segments. IDBI Federal cushions their customers with their services in such a way that the whole process involved is simple and convenient for them. They have trained personnel to convert the prospective clients to net worthy customers. The whole process starts off with meeting the prospect client and making them understand the product and finally closing the deal .They also categorize their high net worth customers from others. The customers are also given a set of choices for their mode of payment. They also get the forms and bonds delivered to their doorstep thus making the whole buying process very simple and tension free.

7 - PHYSICAL DISTRIBUTION: Distribution is a key determinant of success for all insurance companies. Today, the nationalized insurers have a large reach and presence in India. Building a distribution network is very expensive and time consuming. If the insurers are willing to take advantage of India’s large population and reach a profitable mass of customers, then new distribution avenues and alliances will be necessary. Initially insurance was looked upon as a 39 | P a g e

complex product with a high advice and service component. Buyers prefer a face-to-face interaction and they place a high premium on brand names and reliability. As the awareness increases, the product becomes simpler and they become off-the-shelf commodity products. Today, various intermediaries, not necessarily insurance companies, are selling insurance. For example, in UK, retailer like Marks & Spencer sells insurance products. The financial services industries have successfully used remote distribution channels such as telephone or internet so as to reach more customers, avoid intermediaries, bring down overheads and increase profitability. A good example is UK insurer Direct Line. It relied on telephone sales and low pricing. Today, it is one of the largest motor insurance operators. Technology will not replace a distribution network though it will offer advantages like better customer service. Finance companies and banks can emerge as an attractive distribution channel for insurance in India. In Netherlands, financial services firms provide an entire range of products including bank accounts, motor, home and life insurance and pensions. In France, half of the life insurance sales are made through banks. In India also, banks hope to maximize expensive existing networks by selling a range of products. It is anticipated that rather than formal ownership arrangements, a loose network of alliance between insurers and banks will emerge, popularly known as bancassurance. Another innovative distribution channel that could be used is the non-financial organizations. For an example, insurance for consumer items like fridge and TV can be offered at the point of sale. This increases the likelihood of insurance sales. Alliances with manufacturers or retailers of consumer goods will be possible and insurance can be one of the various incentives offered. IDBI Federal has built a vast network of distributors and agents because a face to face interaction is mostly preferred by the customers. Also, they have formed alliances with IDBI Bank and Federal Bank through which they have been able to tap the bank customers too.

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B. Promotional Strategies at IDBI Federal Life Insurance Promotional strategies are very important especially in a service oriented sector because it deals with intangible products. Insurance is a field where much effort is required in making people understand about the product and educate them about its features. Every insurance company put their best efforts in formulizing promotional strategies which attract people to their product and company. Push strategy is followed in insurance industry .This is the strategy used when the manufacturer uses its sales force and trade promotion money to induce intermediaries to carry, promote and sell the product to end users.

Consumers today value information. We live in the information age, and the savvy, faithful customer is one that has knowledge about the products and services offered. The next 41 | P a g e

most valuable insurance marketing tips include the salesperson being the source of financial information for the client. Newsletters, email updates, and notifications will keep customers informed about issues surrounding insurance and other financial programs. There are creative ways to approach these insurance marketing strategies. Newsletters could include contests, special interest areas for kids, safety concerns, and economic updates. There could even be an area for customer spotlights, or encouraging testimonies of how the customers were helped through the office. Of course, all new products and services should be showcased in any informative hard copy or email communication. There are insurance marketing strategies that can take any insurance agency from mediocre to success when utilized correctly. Breaking into a new business climate and finding customers is hard work, but when equipped with innovative ideas and proven techniques, financial markets sales personnel can become extremely successful. Getting an education and training is very important in every industry, sales is certainly no exception. Those selling insurance will want begin their careers with the very best tools of the trade and those with already established businesses that are in need of a motivational push will also gain great benefits by researching and learning new insurance marketing tips. Key insurance marketing strategies will always include an in-depth review of the value of follow-up. All successful sales agents understand that consumers need to be contacted again and again in order to make a vital connection. Also, great follow-up protocol lets the potential customer know that good, solid customer service will be part of the over-all package. Follow-up says to a consumer that they are important, thought of, and that their business would be greatly appreciated. The consumer today not only wants a product at a great price, they also want a personal relationship, especially when it comes to financial system sales, such as various insurances. Letters and phone calls are gentle reminders that the salesperson intends to serve with his or her whole heart. And, once a sale is secured, a thank you call is strongly advised. Those in this industry will also want to keep constant contact with existing customers, too. The competition is fierce today, and no one wants to lose a customer to the next guy or service to come along. Clients that have had no contact for a period of time loose loyalty. Keep birthday and anniversary postcards going into the home on a regular basis. Keeping a name before a consumer will keep a name in their conscience. A small gift or token of appreciation is also a means for keeping customers loyal. Christmas goody packages or dinner out certificates

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will leave lasting impressions on consistent customers. These are few necessary tips which will help any insurance company to take its business to the path of success. Community marketing is another great way to get advertising and name recognition. Successful networkers join local community agencies, such as the local Chamber of Commerce, and sign up to help in activities. This is a great way to get name and photographs listed in newspaper articles and other media avenues. Also, charity work cannot only be greatly beneficial to the community and those served, but may also open doors to communicating with other volunteers, who could be potential clients. People enjoy using services extended by like-minded providers. Creating a sense of community is extremely important to insurance marketing strategies. There are other insurance marketing tips and resources available and insurance agents may find investigating several options to be beneficial. Many marketing support companies offer email or publication updates, sharing information and techniques that are proven to bring in success. Agents may want to browse the Internet and find a few different insurance marketing tips programs to choose from. Not only will these resources help keep salespersons abreast of the latest strategies, but these support programs can also create a sense of community and an opportunity for agents to share their own struggles and challenges with others in the field. Perhaps the most important insurance marketing tips are tips that speak of integrity and honest business dealings. There are so many scams in various industries today; consumers are looking for products and services that they can trust. Building trust will be crucial to keeping a business growing in a stable direction. The most effective and followed modes of communication are: ADVERTISING: Advertising reaches geographically dispersed buyers it can build up a long term image for a product or trigger quick sales. Certain forms of advertising such as television can require a large budget were as other forms such as newspapers do not. Just the presence of advertising might have an effect on sales. Consumers might believe that a heavily advertised brand must offer “good value” .Because of the many forms and uses of advertising it is worth wise to note few observations

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 Pervasiveness: Advertising permits the seller to repeat a message many times it also allows the buyer to receive and compare the messages of various competitors .large scale advertising says something positive about the sellers’ size, power and success.  Amplified Expressiveness: Advertising provides opportunities for dramatizing the company and its products through the artful use of print, sound and color.  Impersonality: the audience does not feel obligated to pay attention or respond to advertising. Advertising is a monologue in front of, not a dialog with the audience. They have brought out many interesting and humorous ads of their products such as Wealthsurance, Incomesurance, Lifesurance, Childsurance etc which has got very good response from customers. a) SALES PROMOTION: Companies use sales promotion tools like coupons, contest, premiums, and the like to draw a stronger and quicker buyer response, including short run effects, such as highlighting, product offers and boosting sagging sales. Sales promotion tools offer three distinctive benefits:  Communication: they gain attention and may lead the customer to the product  Incentive: They incorporate some concession, inducement, or contribution that gives value to the customer.  Invitation: They include a distinct invitation to engage in the transaction now. This mode of communication is mostly followed by insurance companies because this sector deals with a product which requires the full knowledge of the customer. b) PUBLIC RELATIONS AND PUBLICITY: Marketers tend to underuse public relations yet a well thought out program coordinated with the other communication mix elements can be extremely effective, especially if a company needs to challenge consumer’s misconceptions. A company can generate brand awareness either by creating good will or negative buzz to capture the attention of customers. The appeal of public relations and publicity is based on three distinctive qualities:  High Credibility: News, stories and features are more authentic and credible to readers than ads.

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 Ability to catch buyers off guard: Public relations can reach prospects that prefer to avoid salespeople and advertisements.  Dramatization: Public relations have the potential for dramatizing a company or product.

c) EVENTS AND EXPERIENCES: Events and experiences reach out to the customer and can be used for brand- building as well as selling products. There are many advantages to events and experiences.  Relevant: A well-chosen event or experience can be seen as highly relevant because the customer gets personally involved.  Involving: Given their live, real time quality, events and experiences are more actively engaging for customers.  Implicit: Events are an indirect “soft sell”. IDBI Federal have also conducted events with an aim to create interest around financial planning with Life Insurance at branches which was critical to getting prospects interested in their products. Building an engagement process around the solution being offered gives an additional boost to this cause. Spelling Bee was a specially created spelling contest created to connect with children. The philosophy of this module hinged around making learning fun. The event was timed to coincide with Children’s day in November 2010. The spellings to be completed revolved around visual and verbal cues to words related to saving, money and finance and aimed at teaching children the value of money early in life. The engagement started with the spelling contest for kids and gave their IRMs a natural opening for a discussion with parents about financial planning for their children’s future needs like education. This is a sort of channel marketing which IDBI Federal had adopted to create awareness as well as to educate the future generation about the company and the importance of saving. Also IDBI Federal involved them in developing their business by joining hands with SAMHITA, a community development organization based out of Bhopal which works towards bringing financial literacy to the underprivileged population in Madhya Pradesh. They believe that such financial literacy among the under banked population will help bring a holistic change in the way people perceive and understand financial products and their utility at various stages in

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their life. This will ultimately help bring them closer to financial inclusion. They started this journey with SAMHITA in 2008 by providing low cost group coverage female members of SAMHITA under Group Microsurance. This way they have covered 86,721 lives for a sum assured of Rs. 66.7 crores since then. They also offer the protection of Termsurance Grameen Suraksha to the family members of these people. IDBI Federal Termsurance Grameen Suraksha is especially designed to make life insurance affordable to rural customers with options of four convenient premium slabs of Rs 49.08, Rs 98.17, Rs 147.25 and Rs 196.33 (inclusive of taxes) with corresponding sums assured of Rs 5,000, Rs 10,000, Rs 15,000 and Rs 20,000.

d) DIRECT AND INTERACTIVE MARKETING: Direct and interactive marketing takes many forms over the phone, online or in person. They share three distinctive characteristics. Direct and interactive marketing messages are:  Customized: The message can be prepared to appeal to the addressed individual.  Up- to –date: The message can be prepared very quickly.  Interactive: the message can be changed depending on the person’s response.  e) WORD-OF- MOUTH MARKETING: Word of mouth marketing also takes many forms, online or offline. Three noteworthy characters are:  Credible: Because people trust others they know and respect, word of mouth can be highly influential.  Personal: Word of mouth can be very intimate dialogue that reflects personal facts, opinions and experiences.  Timely: It occurs when people want it to and when they are most interested, and it often follows noteworthy or eventful events or experiences.

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PERSONAL SELLING: Personal selling is the most effective tool at later stages of the buying process, particularly in building up buyer preference, conviction and action. Personal selling has three distinctive qualities:  Personal interaction: Personal selling creates an immediate and interactive episode between two or more persons. Each party is able to observe the others reaction.  Cultivation: Personal selling also permits all kinds of relationships to spring up, ranging from a matter of fact selling relationship to a deep personal friendship.  Response: The buyer may feel under some obligation for having listened to the sales talk. IDBI Federal has over thousands of sales personnel all over India to help them with their sales thereby clarifying the doubts of any customer then and there.

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C. Promotional Strategies Adopted By IDBI Federal Following are the main ways in which IDBI Federal life Insurance company ltd promotes its products/services and creates awareness in the market. NEWSPAPER: IDBI Federal has attained notice through many articles and advertisements published in various national and regional newspapers in India like the Economic Times, Times of India, The Hindu , Samachar Jagat, Vir Arjun, Meghalaya Guardian etc. IDBI Federal spends around Rs 1040 per sq.cm for promotional activities through newspapers. They position the ads and articles in such a way that it catches the eye of the reader as soon as they start reading the newspaper. HOARDINGS: IDBI Federal has also tried making their potential customer aware of their products and policies through billboards and hoardings by positioning them in strategic locations. As of now, the total number of hoardings which are put up in Hyderabad region counts to a good 17 number. The total expenses spent by the company for this promotional activity is Rs 4 lakh. PAMPHLETS: Pamphlets are distributed across India at least 5 times in a month without any cost. It’s done to create maximum awareness about the products/services. MAGAZINES: There is no specific magazine in which advertisement is given. It’s given in magazines depending upon their sales and reputed magazines like Outlook, Money etc. The advertisement is given every month at least once in any magazine. TELEVISION: Mainly, the advertisement is shown on cricket channels, Star channels. The main promotions were done during FEB & MARCH to:

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 Highlight the tax benefits  To combat competition as all the insurance companies would advertise during this time at a great frequency. Also the company will soon start displaying their advertisements on Satellite TV like SUN network, etc. DISTRIBUTORS: A strong network of distributors and parent advisors also helps a lot in promoting products/services of IDBI Federal by word of mouth. A Viral campaign is also run on the Internet by wherein flash videos of working of products are explained in a very humorous manner. LOCAL EVENTS: The overall costs associated with such events totals to Rs. 2,00,000 per annum such events are mainly conducted in Apartments, Schools, etc. Building an engagement process around the solution being offered gives an additional boost to this cause. Spelling Bee was a specially created spelling contest created to connect with children. The engagement started with the spelling contest for kids and gave their IRMs a natural opening for a discussion with parents about financial planning for their children’s future needs like education. This is a sort of channel marketing which IDBI Federal had adopted to create awareness as well as to educate the future generation about the company and the importance of saving. Also IDBI Federal involved them in developing their business by joining hands with SAMHITA, a community development organization based out of Bhopal which works towards bringing financial literacy to the underprivileged population in Madhya Pradesh. They believe that such financial literacy among the under banked population will help bring a holistic change in the way people perceive and understand financial products and their utility at various stages in their life. This will ultimately help bring them closer to financial inclusion.

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IV. CHAPTER DATA ANALYSIS & INTERPRETATION

An analytical review of the effectiveness of promotional strategy of IDBI Federal The survey was administered to 101 respondents through google doc and personal meeting about the insurance policy. The questionnaire method to find out the effectiveness of promotional strategy of IDBI Federal Life Insurance co. ltd was used. The main objective of this study is to create awareness and identifying which the strongest promotional strategy to be used by IDBI Federal. This survey has been conducted in Hyderabad and in Lucknow. With the help of charts some graphs and tables are shown below to understand the conducted research.

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Chart no.: 1 Age group of the respondents

Table no.: 1

Age group years

Respondents Percentage

Below 25 25 - 30 30 - 35 Above 35 Total

14 45 33 9 101

14% 45% 33% 9% 100%

Figure no.: 1

50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% Percentage

Below 25

25 - 30

30 - 35

Above 35

14%

45%

33%

9%

INTERPRETATION- From the graph, it is clear that 45% respondents are in the age

group of 25-30 years. 33% respondents are in the age group of 30-35 years however 14% respondents are in the age group of below 25 years and only 9% respondents are above 35 years.

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Chart no.: 2 Gender of the respondents

Table no.: 2 Gender Male Female Total

Respondents 72 29 101

Percentage 71% 29% 100%

Figure no.: 2

Gender of the respondents

Female 29%

Male 71%

INTERPRETATION: - Out of total number of people surveyed 71% are male and 29% are female. So it clear that company should more focus on male people,

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Chart no.: 3 Marital status of the respondents

Table no.: 3 Marital status Married Un-Married Total

Respondents 66 35 101

Percentage 65% 35% 100

Figure no.: 3 Marital status of the respondents

Un-Married, 35%

Married , 65%

INTERPRETATION: - In the above table we can see that out of the total respondents 65% are married and 35% are unmarried. Therefore company should target married people.

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Chart no.: 4 Education Qualification of the respondents

Table no.: 4 Education Qualification Degree Post Graduate M.Phil. Other Total

Respondents 19 72 8 2 101

Percentage 19% 71% 8% 2% 100%

Figure no.: 4

Education Qualification 80%

71%

70% 60% 50% 40% 30% 20%

19% 8%

10%

2%

0%

Degree

Post Graduate

M.Phil.

Other

INTERPRETATION: - In the above table the respondents have been segmented on the basses of their education qualification in which majority i.e. 71% are post-graduate where as 19% are degree holders, 8% are M.Phil. and 21% are having other qualification.

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Chart no.: 5 Job Experience of the respondents

Table no.: 5

Experience

Respondents Percentage

Less than 1 year 1-5 years 5-10 years Above 10 years Total

11 33 40 17 101

11% 33% 40% 17% 100%

Figure no.: 5

Job Experience 45%

40%

40%

33%

35% 30% 25%

17%

20% 15%

11%

10% 5% 0%

Less than 1 year

1-5 years

5-10 years

Above 10 years

INTERPRETATION: - In the above table the respondents have been segmented on the basses of their job experience in which 40% have experience of 5-10 years, 33% are having 1-5 years’ experience, 17% are have above 10 years’ experience, and 11% have less than 1 year experience.

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Chart no.: 6 Income Slab of the respondents

Table no.: 6 Income Slab Less than 2 lacs 2 to 4 lacs 4 to 6 lacs Above 6 lacs Total

Respondents Percentage 10 10% 13 13% 28 28% 50 50% 101 100%

Figure no.: 6

Income Slabe 60% 50%

50%

40% 30%

28%

20% 10%

10%

13%

0%

Less than 2 lacs

2 to 4 lacs

4 to 6 lacs

Above 6 lacs

INTERPRETATION: - In the above table the respondents have been segmented on the basses of their income in which 50% of the respondents are having above rupees 6 lacs per annum income. 28% have income of rupees 4-6 lacs per annum income, 13% have rupees 2-4 lacs per annum income, and 10% have less than rupees 2 lacs per annum income.

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Chart no.: 7 Have you heard about IDBI Federal life insurance Co.Ltd?

Table no.: 7 Awareness about the brand Respondents Yes 88 No 13 Total 101

Percentage 87% 13% 100%

Figure no.: 7

Awarness about the IDBI Federal No 13%

Yes 87%

INTERPRETATION: - From the above table we can find that 87% of the respondents are aware about IDBI Federal Life Insurance Co. Ltd. whereas 13% are not aware.

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Chart no.: 8 How did you come to know about IDBI Federal life insurance Co.Ltd?

Table no.: 8 Source of awareness about brand TV Advertisement You tube Newspaper Bill Board / hoardings Agents Friends Other Total

Respondents 6 5 14 5 31 23 17 101

Percentage 6% 5% 14% 5% 31% 23% 17% 100%

Figure no.: 8 Source of awerness for IDBI Federal Other

17%

Friends

23%

Agents Bill Board / hoardings

31% 5%

Newspaper You tube TV Advertisement

14% 5% 6%

INTERPRETATION: - From the above table we can find that majority of the respondents came to know IDBI Federal Life Insurance through agents and friend, whereas YouTube and bill board / hoardings contributed least as the source of awareness about IDBI Federal Life Insurance.

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Chart no.: 9 Did you enquire more about the product after you came to know about it?

Table no.: 9 Enquire about the product Enquired Un-Enquired Total

Respondents 56 45 101

Percentage 55% 45% 100%

Figure no.: 9

Enquire about the product Un-Enquired 45%

Enquired 55%

INTERPRETATION: - In the above table we can find that 55% of the respondents enquired about product of IDBI Federal Life Insurance whereas as 45% of respondents did not enquire.

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Chart no.: 10 Have you seen the advertisement of IDBI Federal?

Table no.: 10 Awareness of the advertisement Aware Un- Aware Total

Respondents 32 69 101

Percentage 32% 68% 100%

Figure no.: 10

Awareness of the advertisement Un- Aware 68% Aware 32%

INTERPRETATION: - From the above table we can find that 68% of the respondents are not aware of the advertisement of IDBI Federal Life Insurance, whereas 32% are aware. So company should put more focus on advertisement.

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Chart no.: 11 Do you feel these ads educate people about the product?

Table no.: 11 Impact of advertisement on Respondents production education Agree 65 Disagree 36 Total 101

Percentage 64% 36% 100%

Figure no.: 11

Impact of advertisment on production education Disagree 36%

Agree 64%

INTERPRETATION: - From the above table we can find that 64% of the respondents are agreed that these advertisements educate people about the product whereas 36% of the respondents are disagree.

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Chart no.: 12 What is the first thing which comes in your mind when you think of IDBI Federal?

Table no.: 12 Factors affecting recall IDBI bank LOGO Advertisement Services Provided Products Other Total

Respondents 47 6 15 16 14 3 101

Percentage 46% 6% 15% 16% 14% 3% 100%

Figure no.: 12

Factors affacting recall of IDBI Federal Life Insurance 46%

15% 6%

16%

14% 3%

INTERPRETATION: - From the above table we can find that majority of the respondents recalls IDBI Bank when they think about IDBI Federal Life Insurance. Whereas least number of respondents recalls logo or others.

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Chart no.: 13 Which other insurance company you know?

Table no.: 13 Awareness of other brand LIC ICICI Prudential Bajaj Allianz HDFC Standard Life Bharti Axa Birla Sun Life SBI Life Other Total

Respondents

Percentage

40 15 11 14 2 5 9 5 101

39% 15% 11% 14% 2% 5% 9% 5% 100%

Figure no.: 13

Awareness of Other Insurance company 45% 40% 35% 30% 25% 20% 15% 10% 5% 0%

39%

15%

11%

14% 2%

LIC

ICICI Bajaj Prudential Allianz

5%

HDFC Bharti Axa Birla Sun Standard Life Life

9%

SBI Life

5% Other

INTERPRETATION: - From the above table we can find that majority of the respondents are aware about LIC among other insurance company. Whereas least number of respondents knows about Bharti Axa, Birla Sun Life and other insurance company.

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Chart no.: 14 How did you come to know of these insurance company ?

Table no.: 14 Source of awareness about other insurance company TV Advertisement Newspaper Advertisements Bill Board Hoardings Word of Mouth Sales Representatives Friends Other Total

Respondents

Percentage 31 16 13 16 18 6 1 101

30% 16% 13% 16% 18% 6% 1% 100%

Figure no.: 14

Source of awareness Other Friends

1% 6%

Sales Representatives

18%

Word of Mouth Bill Board Hoardings Newspaper Advertisements TV Advertisement

16% 13% 16% 30%

INTERPRETATION: - From the above table we can find that majority of the respondents came to know about other insurance companies through TV advertisement whereas least no of respondents came to know through friends and other sources.

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Chart no.: 15 Main consideration that a customer looks while purchases an insurance policy?

Table no.: 15 Main consideration while purchase TAX Protection Investment Saving Pension Total

Respondents

Percentage

14 30 17 30 10 101

14% 29% 17% 30% 10% 100%

Figure no.: 15

Main consideration while purchase 30%

29%

17%

14%

10%

TAX

Protection

Investment

Saving

Pension

INTERPRETATION: - From the above table we can find that majority of the respondents consider saving and protection while purchasing of insurance policies, whereas least number of respondents consider pension.

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Chart no.: 16 What type pf plan you have?

Table no.: 16 Type of plan that respondents have Lifesurance Incomesurance Childsurance Wealthsurance Other Total

Respondents

Percentage

38 18 22 19 4 101

37% 18% 22% 19% 4% 100%

Figure no.: 16

Type of plan 40%

37%

35% 30% 25%

20%

18%

22%

19%

15% 10%

4%

5% 0%

Lifesurance Incomesurance Childsurance Wealthsurance

Other

INTERPRETATION: - From the above table we can find that 37% of the respondents have life insurance, 22% have child insurance, 19% have wealth insurance, 18% have income insurance and rest 4% of the respondents have other type of insurance.

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V.

CHAPTER

FINDINGS & SUGGESTIONS After analysis it is found that,  Television for entertainment and gaining information. So it is the best media for promotion.  People don’t give more importance for the advertisements while compared to brand, tax benefit, death benefit, security and low premium.  The promotional efforts and word of mouth is most influencing while compared to internet.  The unmarried people are actually not interested to take insurance. They wanted to invest their money in other fields like buying a house, bike, buildings, and real-estate etc. They are even ready to take risk for more earnings. 

The married peoples are interested in insurance for the benefit of their partner as well as their children and medical expenses. Generally educated people understand easily so most of graduate clearly understand the benefits of insurance policies.



So IDBI Federal Life Insurance Corporation Limited can develop a new policy by targeting the unmarried people.

 IDBI have to increase their promotional activities in such a way that even unskilled persons understand the importance of their Insurance add value to their customer.  The company’s advertisement should be more in Local TV channel and News Paper.  The company should be open more branches in, zonal areas.  Hoardings at prime areas in recommended.  In rural and tribal areas enormous promotional activities have to be taken for bringing the awareness regarding different types of insurance and their uses. IDBI Federal Life Insurance should develop promotional activities in such a way that it should reach to the tribal and interior areas in an easy and understandable manner. And it has to increase its

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promotional activities in tribal area. In rural and tribal areas they have to use a different type of promotion, to make them understand the various policies and their benefits.  Most of the insured people select policies based on the agent’s advice. Company should advertise about their policies, as the agents suggest the policies that fetch more commission to them, and this creates a negative attitude among the customers.  Irrespective of the occupation, age, marital status, caste, religion and educational qualification everyone has to feel the need of life insurance. Hence the company should bring awareness about the insurance and its importance and need. The unfavorable feeling of illiterates, daily wage workers etc., can be washed out by educating the households extensively. IDBI Federal should create awareness about insurance among people. Most of the uninsured have negative attitude as they don’t have knowledge about insurance. Generally insurance is considered as only for high income people. This notion must be changed, through social marketing among the low income people.

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REFERENCES

Literatures from different journals 

1

Garg, M.C.& Verma A.2010. An empirical analysis of the marketing mix in the Life

Insurance Industry in India. The IUP journal of management research .Vol.9. pp07-20. 

2

Abdalelah S. Saaty A 2011. Factors Critical in Marketing Strategies of Insurance

Companies in Saudi Arabia. The International Journal of Marketing Studies. Vol.3. pp104-122. 

3

D’Andrea & Schleicher A 2006. The role of promotions and other factors affecting

overall store price image in Latin America. The International Journal of Retail & Distribution Management Vol. 34 No. 9, 2006. pp. 688-700. 

4

P Venugopal A 2010. Attitude of Insured on Agents and Promotional Activities of Life

Insurance Companies. Drishtikon: A Management Journal Vol. 1 no. 2. 2010. pp. 369394. 

5

Shameem B. & Dr. Gupta A 2012. Marketing Strategies In Life Insurance Services. International Journal of Marketing, Financial Services & Management Research Vol.1 Issue 11, November2012. pp132-141.

Internet Sources: http://www.irda.gov.in/Defaulthome.aspx?page=H1 https://www.idbifederal.com/Pages/home.aspx http://www.scribd.com/search?query=idbi+federal+life+insurance http://www.articlesbase.com/find-articles.php?q=idbi+federal+life+insurance http://www.lifeinscouncil.org/ http://www.ibef.org/industry/insurance-sector-india.aspx

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ANNEXURE Questionnaire

An analytical review of the effectiveness of promotional strategy of IDBI Federal This study attempts to understand your perception on promotional strategy and is purely for an academic purpose only. It is not intended to by publish anywhere. Your cooperation will be appreciated. Thanking you in advance! Q.1. Name ______________________ Q.2. Age Below 25 years 30-35 years 25-30 years Above 35 years Q.3. Sex Male Females Q.4. Married Yes No Q.5. Educational qualification Degree Post Graduate M.Phils. Q.6. Experience Less than 1 year 1-5 years 5-10 years Above 10 years Q.7. Income Less than 2 lacs 2 to 4 lacs 4 to 6 lacs Above 6 lacs Q.8. Have you heard about IDBI Federal life insurance Co.Ltd? Yes No Q.9. How did you come to know about IDBI Federal life insurance Co.Ltd? TV Advertisement You tube Newspaper Bill Board / hoardings Agents Friends Others please specify__________ Q.10. Did you enquire more about the product after you came to know about it? Yes No Q.11. Have you seen the advertisement of IDBI Federal Yes No If yes specify the advertisement you have seen and rate them according to the example: Excellent (5) , Good (4), Average (3), poor(2) , worst (1) Incomesurance Lifesurance Wealthsurance Childsurance Q.12. Do you feel these ads educate people about the product? Yes No

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Q.13. What is the first thing which comes in your mind when you think of IDBI Federal? IDBI bank LOGO Advertisement Services Provided Products Others please specify__________ Q.14. Which other insurance company you know? LIC Bharti Axa SBI Life National Insurance HDFC ICICI Bajaj Allianz Others please specify_________ Q.15. How did you come to know of these insurance company ? TV Advertisement Newspaper Advertisements Bill Board Hoardings Word of Mouth Sales Representatives Friends Others please specify________ Q.16. Main consideration that a customer looks while purchases an insurance policy? TAX Protection Investment Saving Pension Q.17. What type pf plan you have Lifesurance Incomesurance Childsurance Wealthsurance Other please specify Q.18. According to you the purpose of insurance is? Pre matured death Living too long Child future Wealth creation Tax saving Q.19. Any suggestions for IDBI Federal life Insurance Co.Ltd.

Q.20. Please give reference of two people who might be in insurance? A. Name…………………. Address…………………. B. Name………………… Address………………….. Date___________

____________ Signature

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