Customer Satisfaction in LIC

PROJECT REPORT ON CUSTOMERS SATISFACTION IN

(SATISFACTION OF CUSTOMERS WITH THE SERVICES OF THE LIFE INSURANCE INDUSTRY IN INDIA WITH SPECIAL REFERENCE OF LIC)

P RE F AC E The field of insurance has taken a giant leap at the threshold of twentieth century. Insurance have become an integral part of life of man all over the globe. The proverb ‘Need is the mother of invention’ is proving equally correct in case of insurance.

Insurance have already had a considerable impact on

many

aspects

of

our

society.

This

project on “life Insurance corporation of India” deals with the automation of various activities done in insurance like how the insurance companies doing there business and what is the feature of life insurance.

ACKNO WLEDGEMENT

We are hearty grateful to Mr. ………………………….sir (director). They have always been an invaluable source of inspiration had work, sincerity and dedication. It gives me immense pleasure in submitting this project on “Life Insurance Corporation of India”. I have developed this project in partial fulfillment of b.b.a 6th sem from ‘sarswati institute of management and technology I would like to express my sincere ineptness to my Project Guide mrs preeti ma,am for his constant guidance and valuable support during the project work. Encouragement and excellent guidance in the successful completion of the project work. And of course nothing could have come true without the support of my family, friends and all the classmates for their constant encouragement and useful tips through out my project. I will always

grateful to them.

Student name-

Contents Chapter 1- introduction And objective Chapter 2-industry profile Chapter 3-company profile Chapter 4-subject matter Introduction of topic Research methodology

Chapter 5- dat analysis and interpretation Chapter 6-conclusion Cchapter7-recommentation Chapter8- bibliography

Chapter 1

INTRODUCTION

INTRODUCTION LIFE INSURANCE IN INDIA Life insurance in India made its debut well over 100 years ago. In our country, which is one of the most populated in the world, the prominence of insurance is not as widely understood, as it ought to be. What follows is an attempt to acquaint readers with some of the concepts of life insurance, with special reference to LIC It should, however, be clearly understood that the following content is by no means an exhaustive description of the terms and conditions of an LIC policy or Its benefits or privileges. For more details, please contact our branch or divisional office. Any LIC Agent will be glad to help you choose the life insurance plan to meet your needs and render policy servicing.

What Is Life Insurance? Life insurance is a contract that pledges payment of an amount to the person assured (or his nominee) on the happening of the event insured against. The contract is valid for payment of the insured amount during: • The date of maturity, or • Specified dates at periodic intervals, or • Unfortunate death, if it occurs earlier.

Among other things, the contract also provides for the payment of premium periodically to the Corporation by the policyholder. Life insurance is universally acknowledged to be an institution, which eliminates 'risk', substituting certainty for uncertainty and comes to the timely aid of the family in the unfortunate event of death of the breadwinner. By and large, life insurance is civilization’s partial solution to the problems caused by death. Life insurance, in short, is concerned with two hazards that stand across the life-path of every person: 1. That of dying prematurely leaving a dependent family to fend for itself. 2. That of living till old age without visible means of support.

Customer satisfied with LIC service because the LIC totally concentrate customer relations and it makes customers attract towards the LIC

LIC

moves

towards

better

customer

relations Plans to start a new portal for its policyholders Our Regional Bureau / Hyderabad September 07, 2005

Life Insurance Corporation of India (LIC) is embarking on a number of customer relationship management initiatives to retain its foothold in the market, in the wake of private players inching their way up in the life insurance sector. The Insurance behemoth is planning to tie-up with a number of banks to enable a payment gateway wherein the policyholders can make their premium payments via credit cards. LIC is planning to start a new portal for its policyholders where a customer can log in, get details on his/her policies, change the resident address when he/she shifts to a new place and even take a printout of the income tax certificate. The portal is likely to be ready in a month’s time. Besides, it has already started work on allotment of customer folio number to know each customer's holding. “The allotment of customer folio number for all our holders will still take a year’s time in this zone,” H Nanda, regional manager, information technology, LIC (south-central zone), said. “The electronic clearance system that we have launched at Hyderabad, Bangalore, Vijayawada and Visakhapatnam, has been doing very well. Here the customer’s premium is automatically debited from his account at the time of payment,” he added. Shortly, the zone will also see the launch of this system in Mysore, Mangalore and Hubli. “This month, we will also be setting up five satellite branches in the zone, with two being in Hyderabad and three in Bangalore,” A K Sahoo, regional manager (marketing), LIC (south-central zone), said at a press conference organised on the occasion of the beginning of the golden jubilee year for LIC. Regarding the recently launched Bima Gold policy, a money-back policy with premium payment options, the corporation plans to sell 15 lakh policies this year in the south central zone with the national figure being one crore. LIC also plans to launch three-four products this year with one of these being unit-linked insurance plan in October. As on August 31, 2005, the zone has issued 12,47,795 policies under new business.

OBJECTIVES OF THE STUDY The main objective of this study is to carry on brief study on “Customer satisfaction survey on insurance products of LIC Other objectives of this project are as follows:  To identify the insurance needs of the Indian population with respect to their emotional, physical and financial

conditions. 

Comparative study of various insurance players in the market



To study the varied reasons of availing life insurance plans



To

clearly

understand

the

rationale

behind

the

investment in policies of LIC and private sector insurance companies  To test the awareness of customers on various aspects of life insurance policies offered by LIC and other private sector insurance companies and find whether there is any relation between them.  The prime objective of the study is to find out the level of satisfaction of a

customer (policy holders or beneficiary) so far as the settlement of claims.  To find out the procedure of claim policy holder or the beneficiary

Chapter 2

Industry profile

Industry profile ABOUT THE ORGANIZATION Life Insurance in its modern form came to India from England in the year 1818. Oriental Life Insurance Company stated by Europeans in Calcutta was the first life insurance company on Indian Soil. All the insurance companies established during that period were brought up with the purpose of looking after the needs of

European community and Indian natives were not being insured by these companies. However, later with the efforts of eminent people like Babu Muttylal Seal, the foreign life insurance companies started insuring Indian lives. But Indian lives were being treated as sub-standard lives and heavy extra premiums were being changed on them. Bombay Mutual Life Assurance Society heralded the birth of first Indian life insurance company in the year 1870, and covered Indian lives at normal rates. Starting

as

Indian

enterprise

with

highly

patriotic

motives,

insurance companies came tito existence to carry the message of insurance and social security through insurance to various sectors of society. Bharat Insurance Company (1896) was also one of such companies inspired by natioalism. the Swadeshi movement of 19051907 gavwe rise to more insurance companies. The United India in Madras, National Indian and National Insurance in Calcutta and the Hindustan Co-operative Insurance Company took its birth in one of the rooms of the Jorasanko, house of the great poet Rabindranath Tagore, in Calcutta. The Indian Mercantile, General Assurance and Swadeshi Life (later Bombay Life) were some of the companies established during

the same period. Prior to 1912. India had no legislation to regulate insurance business. In the year 1912, the Life Insurance Companies Act, and the Provident Fund Act were passed. The Life Insurance Companies Act, 1912 made it necessary that the premium rate tables and periodical valuations of companies should be certified by an actuary. But the act discriminated between foreign and Indian companies on many accounts, putting the Indian companies at a disadvantage. The first two decades of the twentieth century saw lot of growth in insurance business. From 44 companies with total business-in force as Rs. 22.44 crore, it rose to 176 companies with total business-in-force as Rs. 298 crore in 1938. During the mushrooming of insurance companies many financially unsound concerns were also floated which failed miserably. The Insurance Act 1938 was the first legislation governing not only life insurance but also non-life insurance to provide strict state control over insurance business. The demand for nationalization of life insurance industry

was

made

repeatedly

in

the

past

but

it

gathered

momentum in 1944 when a bill to amend the Life Insurance Act 1938 was introduced in the Legislative Assembly. However, it was much later on the 19th of January, 1956, that life insurance

in India was nationalized. About 154 Indian insurance companies, 16 non-Indian companies and 75 provident were operating in India at the time of nationalization, nationalization

was

accomplished

in

two

stages;

initially

the

management of the companies was taken over by means of an Ordinance, and later, the ownership too by means of a comprehensive bill. The Parliament of India passed the Life Insurance Corporation Act on the 19th of June 1956, and the Life Insurance Corporation of India was created on 1st September, 1956, with the objective of spreading life insurance much more widely and in particular to the rural areas with a view to reach all insurable persons in the country, providing them adequate financial cover at a reasonable cost. LIC had 5 zonal offices, 33 divisional offices and 212 branch offices, apart from its corporate office in the year 1956. Since life insurance contracts are long term contracts and during the currency of the policy it requires a variety of services need was felt in the later years to expand the operations and place a branch office at each district headquarter, re-organization of LIC took place and large numbers of new branch offices were opened. As a result of re-organization servicing functions were

transferred to the branches, and branches were made accounting units. It worked wonders with the performance of the corporation. It may be seen that from about 200.00 crores of New Business in 1957 the corporation crossed 1000.00 crores only in the year 1969-70, and it took another 10 years for LIC to cross 2000.00 crore mark of new business. But with re-organization happening in the early eighties, by 1985-86 LIC had already crossed 7000.00 crore Sum Assured on new policies. Today LIC functions with 2048 fully computerized branch offices, 100 divisional offices, 7 zonal offices and the corporate office. LIC’s Wide Area Network covers 100 divisional offices and connects all the branches through a Metro Area Network. LIC has tied up with some Banks and Service providers to offer on-lint premium collection facility in selected cities. LIC’s ECS and ATM premium payment facility is an addition to customer convenience. Apart from on-line Kiosks and IVRS, Info Centres have been commissioned at Mumbai, Ahmedabad, Bangalore, Chennai, Hyderabad, Kolkata, New Delhi, Pune and many other cities. With a vision of providing easy access to its policyholders, LIC has launched its SATELLITE SAMPARK offices. The satellite offices are smaller, leaner and closer to the

customer. The digitalized records of the satellite offices will facilitate anywhere servicing and many other conveniences in the future. LIC continues to be the dominant life insurer even in theliberalized scenario of Indian insurance and is moving fast on a new growth trajectory surpassing its own past records. LIC has issued over one crore policies during the current year. It has crossed the milestone of issuing 1,01,32,955 new policies by 15th Oct, 2005, posting a healthy growth rate of 16.67% over the corresponding period of the previous year. From then to now, LIC ha crossed many milestones and has set unprecedented performance records in various aspects of life insurance business. The same motives which inspired our forefathers to bring insurance into existence in this country inspire us at LIC to take this message of protection to light the lamps of security in as many homes as possible and to help the people in providing security to their families. Some of the important milestones in the life insurance business in India are: 1818: Oriental Life Insurance Company, the first life insurance company on Indian soil started functioning. 1870: Bombay Mutual Life Assurance Society, the first Indian life insurance company

started its business. 1912: The Indian Life Assurance Companies Act enacted as the first statute to regulate the life insurance business. 1928: The Indian Insurance Companies Act enacted to enable the government to collect statistical information about both life and non-life insurance businesses. 1938: Earlier legislation consolidated and amended to by the Insurance Act with the objective of protecting the interests of the insuring public. 1956: 245 Indian and foreign insurers and provident societies are taken over by the central government and nationalized. LIC formed by an Act of Parliament, viz. LIC Act, 1956, with a capital contribution of Rs. 5 crore from the Government of India. The General insurance business in India, on the other hand, can trace its roots to the Triton Insurance Company Ltd., the first general insurance company established in the year 1850 in Calcutta by the British. Life insurance Corporation of India (LIC) The Life insurance Corporation was established about 44 years ago with a view to provide an insurance cover against various risks in life. A monolith then, the corporation, enjoyed a monopoly status and

become synonymous with life insurance. Its main asset is its staff strength of 1.24 lakhs employed and 2,048 branches and over six-lakhs agency force. LIC has hundred divisional offices and has established extensive training facility at all levels. At the apex, is the Management Development Institute, seven zonal Training Centre and 35 sales Training Centers. At the industry level, along with the Government and the GIC, it has helped establish the National Insurance Academy. It presently

transacts

individual

Life

Insurance

business,

group

Insurance business, social security schemes and Pensions, grants housing loans through its subsidiary. And the markets savings and Investment products through its mutual fund. It pays off about Rs 6,000 crores annually to5.6 million policyholders

LIC OPERATES ALL OVER INDIA

OBJECTIVES OF LIC



 Spread Life Insurance widely and in particular to the rural areas and to the socially and economically backward classes with a view to reaching allinsurable

persons

in

the

country

and

providing

them

adequate financial cover against death at a reasonable cost. 



Maximize

mobilization

of

people’

savings

by

making

insurance-linked savings adequately attractive. 



Bear in mind, in the investment of funds, the primary

obligation to its policyholders, whose money it holds in trust, without losing sight of the interest of the community as a whole; the funds to be deployed to the best advantage of the investors as well as the community as a whole, keeping in view national priorities and obligations of attractive return. 

 Conduct business with utmost economy and with the full realization that moneys belong to the policyholders.



 Act as trustees of the insured public in their individual and collective capacities.



 Meet the various life insurance needs of the community that would arise in the changing social and economic environment.



 Involve all people working in the Corporation to the best of their capability in

furthering the interests of the insured public by providing efficient service with courtesy. 



Promote

amongst

all

agent

and

employees

of

the

corporation a sense of participation, pride and job towards achievement of Corporate objective.

MISSION/VISION Mission “Explore and enhance the quality of life of people through financial security by providing

products

and

services

of

aspired

attributes

with

competitive returns, and by rendering resources for economic development.” Vision “A

trans-nationally

competitive

financial

conglomerate

of

significance to societies and Pride of India.” LIC of India is the one and only public sector life insurance Company in India. Some of the important milestones in the life insurance business in India are:

1818: Oriental Life Insurance Company, the first life insurance company on Indian soil started functioning. 1870: Bombay Mutual Life Assurance Society, the first Indian life insurance company started its business. 1912: The Indian Life Assurance Companies Act enacted as the first statute to regulate the life insurance business. 1928: The Indian Insurance Companies Act enacted to enable the government to collect statistical information about both life and non-life insurance businesses. 1938: Earlier legislation consolidated and amended to by the Insurance Act with the objective of protecting the interests of the insuring public. 1956: 245 Indian and foreign insurers and provident societies are taken over by the central government and nationalised. LIC formed by an Act of Parliament, viz. LIC Act, 1956, with a capital contribution of Rs. 5 crore from the Government of India. The General insurance business in India, on the other hand, can trace its roots to the Triton Insurance Company Ltd., the first general insurance company established in the year 1850 in Calcutta by the British.

Chapter 3

Company profile

Company profile

Type: Public limited company or Government-owned corporation Founded: September 1, 1956 Headquarters: Headquarters in Mumbai, India (Various other locations in India and abroad) Key people: T. S. Vijayan (Chairman), D. K. Mehta and Thomas Mathew (Managing Directors) Industry: Life insurance Products: Insurance and Pension Plans Employees: Over 10,00,000 Parent: NIL Subsidiaries: LIC Housing Finance Limited, etc. Website: http://www.licindia.com

Products of LIC LIC - Jeevan Anurag

Benefits

LIC’s Jeevan ANURAG is a with profits plan specifically designed to take care of the educational needs of children. The plan can be taken by a parent on his or her own life. Benefits under the plan are payable at prespecified durations irrespective of whether the Life Assured survives to the end of the policy term or dies during the term of the policy. In addition, this plan also provides for an immediate payment of Basic Sum Assured amount on death of the Life Assured during the term of the policy.

AssuredBenefit Payment of 20% of the Basic Sum Assured at the start of every year during last 3 policy years before maturity. At maturity, 40% of the Basic Sum Assured along with

reversionary bonuses declared from time to time on full Sum Assured for the full term and the Terminal bonus, if any shall be payable. For example, if term of the policy is 20 years, 20% of the Sum assured will be payable at the end of the 17th, 18th, 19th year and 40% of the Sum Assured along with the reversionary bonuses and the terminal bonus, if any, at the end of the 20th year.

Death Benefit Payment of an amount equal to Sum Assured under the basic plan immediately on the death of the life assured.

LIC - Jeewan Kisore

Product summary: This is an Endowment Assurance Plan available for children of less than 12 years of age. The policy may be purchased by any of the parent/grand parent.

Commencement of risk cover: The risk commences either after 2 years from the date of commencement of policy or from the policy anniversary immediately following the completion of 7 years of age of

child, whichever is later.

Premiums: Premiums are payable yearly, half-yearly, quarterly or monthly throughout the term of the policy or till earlier death of child.

Bonuses: This is a with-profits plan and participates in the profits of the Corporation’s life insurance business.

It gets a

share of the profits in the form of bonuses. Simple Reversionary Bonuses are declared per thousand Sum Assured annually at the end of each financial year. Once declared, they form part of the guaranteed benefits of the plan. A Final (Additional) Bonus may also be payable provided policy has run for certain minimum period.

LIC – Childs Career Plan Introduction: This plan is specially designed to meet the increasing educational and other needs of growing children. It provides the risk cover on the life of child not only during the policy term but also during the extended term (i.e. 7 years after the expiry of policy term). A number of Survival benefits are payable on surviving by the life assured to the end of the specified durations.

Options: You may choose Sum Assured (S.A.), Maturity Age, Policy Term, Mode of Premium payment and Premium Waiver Benefit.

Payment of

Premiums:

You may pay the premiums regularly at yearly, half-yearly, quarterly or through Salary deductions over the term of policy. Premiums may be paid either for 6 years or up to 5 years before the policy term.

LIC - Jeevan Chhaya Product summary: This is an Endowment Assurance plan that provides financial protection against death throughout the term of the plan. Besides payment of Sum Assured immediately on death, one-fourth of Sum Assured is payable at the end of each of last four years of policy term whether the life assured dies or survives the term of the policy.

Premiums: Premiums are payable yearly, half-yearly, quarterly, monthly or through salary deductions as opted by you throughout the term of the policy or till the earlier death.

LIC - Child Future Plan

Introduction: This plan is specially designed to meet the increasing educational,

marriage

and

other

needs

of

growing

children. It provides the risk cover on the life of child not only during the policy term but also during the extended term (i.e. 7 years after the expiry of policy term). A number of Survival benefits are payable on surviving by the life assured to the end of the specified durations.

Options: You may choose Sum Assured (S.A.), Maturity Age, Policy Term, Mode of Premium payment and Premium Waiver Benefit.

Payment of

Premiums:

You may pay the premiums regularly at yearly, half-yearly, quarterly or through Salary deductions over the term of policy. Premiums may be paid either for 6 years or up to 5 years before the policy term.

LIC - Jeevan Shree Product summary: This is an Endowment Assurance plan offering the choice of many convenient premium-paying terms. It provides financial protection against death throughout the term of plan with the payment of maturity amount on survival to the end of the policy term.

Premiums: Premiums are payable yearly, half-yearly, quarterly, monthly or through Salary deductions, as opted by you, throughout the premium paying term or till earlier death. Alternatively premium may be paid in one lump sum.

Guaranteed

Additions:

The policy provides for the Guaranteed Additions at the rate of Rs. 50/- per thousand Sum Assured for each completed year for first five years of the policy.

LIC - The Whole Life Policy This plan is mainly devised to create an estate for the heirs of the policyholder as the plan basically provides for payment of sum assured plus bonuses on the death of the policyholder. However, considering the increased longevity of the Indian population, the Corporation has amended the above provision, thereby providing for payment of sum assured plus bonuses in the form of maturity claim on completion of age 80 years or on expiry of term of 40 years from date of commencement of the policy whichever is later. The premiums under the policy are payable up to age 80 years of the policyholder or for a term of 35 years whichever is later. If the payment of premium ceases after 3 years, a paid-up policy for such reduced sum assured will be automatically secured provided the reduced sum assured exclusive of any attached bonus is not less than Rs.250/-. Such reduced paid-up policy is not entitled to participate in the bonus declared thereafter but the bonuses already declared on the policy will remain attach, provided the policy is converted in to a paid-up policy after the premiums

are paid for 5 years.

LIC – Amulya Jeevan

: On Death during the Term of

the Policy: Sum Assured

On Maturity:

Nil

RESTRICTIVE CONDITIONS Minimum age at entry

: 18 years (completed)

Maximum age at entry

: 60 years (nearest birthday)

Maximum

age

at

maturity

: 70 years (nearest birthday)

Minimum Policy Term

: 5 years

Maximum Policy term

: 35 years

Minimum Sum Assured

: Rs.25,00,000/-

Maximum Sum Assured

: No Upper Limit

(Policies will be issued in multiples of Rs.100,000/- for Sums Assured more than the minimum Sum Assured) Mode of premium : Yearly, Half-yearly & Single payment

Premium

ORGANISATION STRUCTURE OF LIC

Chairman Managing Director Executives Directors Chiefs Zonal Managers Regional Managers Divisional Managers 100 Seniors Divisional Managers Marketing Managers Sales Managers Senior Branch Managers (Head of the Branch) Assistant Branch Managers Sells Development Officers

Different Agent PUBLIC RELATION DEPARTMENT The Public Relation Department in LIC is divided into three major categories. Namely: 1. Communication Department 2. Crisis Management Department 3. Publicity Department

Chief Public Relation Officer

PRO (Communication Dept.)

PRO (Crisis Management Dept.)

PRO (Publicity Dept.)

CHAIRMAN OF LIC PUBLIC RELATIONS

COMMUNICATION DEPARMENT

DEPARMENT

PUBLICITY

CRISIS MANAGEMENT DEPATMENT

CHIEF PUBLIC RELATION OFFICER The Chief Public Relation Officer of LIC is Mr. M. V. Kulkarni. He heads the PR department. The above three committees are under the PRO. The PRO is responsible for the overall functioning of the PR department. He has to monitor the smooth functioning of the three departments.

RESPONSIBILITIES OF CHIEF PUBLIC RELATION OFFICER :1. PR represents whole organization. 2. Should know how to behave in a certain situation. 3. He is not a person, he is representative. 4. Should know how to create enthusiasm. 5. In crisis he has to give feedback as soon as possible. OBJECTIVES AND FUNCTIONS OF CHIEF PUBLIC RELATION OFFICER:-

• The PRO is directly answerable to the Chairman Shri. T.S. Vijayan. • The PRO looks after all the activities of the three departments all over India.

• Also he has to keep in close touch with the over-seas PR departments of LIC.

• All the policies implemented in India are informed to other PROs of the over-seas branches of LIC.

• The PRO monitors the norms and values of all the branches. • The new rules and regulations in India are informed to the PROs of the

over-seas branches.

• The PRO also holds regular workshops for the top management employees to motivate them to lift the spirit of the work culture.

• The PRO also has to provide information about latest policies to the communication department and ask them to public or air it through various mediums.

• Since a major share of workload of LIC is in the public sector, the PRO has to look after social responsibility as well as maintaining the image of the company.

COMMUNICATION DEPARTMENT The PRO of this Department is an external PR. He looks after:-

• Arranging press conferences, press releases and is in constant contact with the media.

• He is also responsible for monitoring the overseas communications. • The Communication Department PRO has to make arrangements for the guests and their overall honors. The conversations with the guests are directly done by the Communication Department PRO.

• The PRO from this department should always keep a close eye on the latest happenings in the market. Any social issue at any area is a news to be worked out for him.

• He reports directly to the Chief PRO of the company. • The Press conference usually includes the CEO of the company, the Chief PRO and the Communication Dept. PRO.

• If the case is of crisis, then only is the Crisis management Dept PRO present for the Press conference.

• Since LIC is closely related with the Public Sector, the Communication Dept. PRO has to also be in a close contact with the government officials.

• He also has to motivate the employees in his department for constant progress in the strategies for communication. In short, the communication Department PRO ensures that there is no communication gap between the company and the external concerned bodies. (recent press releases of LIC issued by Communication Department PRO enclosed)….

CRISIS MANAGEMENT DEPARTMENT The PRO in this department is an internal one. From the overall history of LIC, it is seen that the company has never been into any major crisis. This itself is one of the best achievements. He is answerable to the Chief Public Relation Officer. The PRO from crisis management, though is here to handle crisis, he has been assigned many other internal responsibilities.

• Motivating the lower employees, sales executives and sales and marketing employees.

• Building up a smooth communication between the Blue Collar and the White Collar.

• Arranging small workshops for all the employees. • He also has to know the issues going within the other departments so that these issues are solved before they create crisis. The strategy used by the PR here for crisis management is:“Wash the utensil before having food in it.” Thus all the employees right from the day of joining are kept in close

contact with the Crisis Management Dept. And regular workshops help to restrict cases like Corruption. With a company so closely associated with the government, restricting such practices is very difficult task.

PUBLICITY DEPARTMENT The PRO of the publicity Department is an External PR. This department was formed due to the fall of sales in the 1999. This fall was due to the emergence of the foreign insurance companies and their advertising strategies. Initially, the ads shown by LIC always said “no worry even after death”. All the ads portrayed death. The other insurance companies came up with the idea that insurance is for happy life. Thus the sales of LIC went down as people liked the idea of Life more than Death. Hence a separate publicity department was formed which worked only for publicity strategies. Initially it was looked up by the Communication Department. Today the publicity department PRO has to see to it that all the ads running are creating effect. The PRO is the one who along with the Marketing department looks after the strategies for publicity. He is also to carry out various campaigns. The very recent campaign is known as “Zindagi Express”. The Zindagi Express is a term that has been associated to the life of LIC. Just as humans celebrate their 50 years of life, even LIC is celebrating its life. and when any person has done a lot in his life, he is capable of writing an Autobiography. Thus Zindagi Express is an Autobiography by LIC. They had started this unique campaign of auto biography from Delhi and

will cover the entire nation and end up in Delhi again. During this journey they explain what all LIC has done for publics and what all it still intends to do

To satisfy the consumers in lic they make effective public relations and consumer relations S.W.O.T. ANALYSIS OF LIC

A proper S.W.O.T. analysis of

LIC has also been conducted to know better about the position, growth, and upcoming future and prospective of the company.

STRENGTHS

•

LIC is on 1st rank among the Insurance player.

•

Long-term plans of LIC are the main strength.

•

After sales services.

•

Products cost are very low.

•

Customer does not believe on private company.

WEEKNESS Low interest rate

OPPORTUNITIES •

Good brand promotion.

•

1/2nd- % insurance has been covered.

THREATS •

Competitors.

•

Entry of Private Insurance banks..

Chapter 4

Subject matter Introduction of topic

Research methodology Subject matter Introduction of topic What is customer satisfaction?

Customer satisfaction refers to how satisfied customers are with the products or services they receive from a particular agency. The level of satisfaction is determined not only by the quality and type of customer experience but also by the customer’s expectations.

A customer may be defined as someone who: • has a direct relationship with, or is directly affected by your agency and receives or relies on one or more of your agency’s services or

products.

Customers

referred to as

in

human

services

are

commonly

service users, consumers or clients.

• An organisation with a strong customer service culture places the customer at the centre of service design, planning and service delivery. Customer centric organisations will:

• determine the customers expectations when they plan • listen to the customer as they design • focus on the delivery of customer service activities •

Value

customer

feedback

when

they

measure

performance.

Why is it important? There are a number of reasons why customer satisfaction is important in

Insurance Sector: • Meeting the needs of the customer is the underlying rationale for the existence of community service organizations. Customers have a right to

quality services that deliver outcomes. • Organizations that strive beyond minimum standards and exceed the

expectations of their customers are likely to be leaders in their

sector. • Customers are recognized as key partners in shaping service development and assessing quality of service delivery. The process for measuring customer satisfaction and obtaining feedback on organizational performance are valuable tools for quality and continuous

service

improvement.Customer

satisfaction,

a sinebuss term, is a measure of how products and services supplied by a company meet or surpass customer expectation. It is seen as a key performance indicator within business and is part of the four of a Balanced Scorecard. In a competitive marketplace where businesses compete for customers, customer satisfaction is seen as a key differentiator and increasingly has become a key element of business strategy.[1] There is a substantial body of empirical literature that establishes the benefits of customer satisfaction for firms. Organizations need to retain existing customers while targeting non-customers; [2]

. Measuring customer satisfaction provides an indication of how successful the

organization is at providing products and/or services to the marketplace. Customer satisfaction is an abstract concept and the actual manifestation of the state of satisfaction will vary from person to person and product/service to product/service. The state of satisfaction depends on a number of both psychological and physical variables which correlate with satisfaction behaviors such as return and recommend rate. The level of satisfaction can also vary depending on other factors the customer, such as other products against which the customer can compare the organization's products.

Customer Satisfaction in 7 Steps in LIC

It's a well known fact that no business can exist without customers. In the business of Website design, it's important to work closely with your customers to make sure the site or system you create for them is as close to their requirements as you can manage. Because it's critical that you form a close working relationship with your client, customer service is of vital importance. What follows are a selection of tips that will make your clients feel valued, wanted and loved. 1. Encourage Face-to-Face Dealings

This is the most daunting and downright scary part of interacting with a customer. If you're not used to this sort of thing it can be a pretty nerve-wracking experience. Rest assured, though, it does get easier over time. It's important to meet your customers face to face at least once or even twice during the course of a project. My experience has shown that a client finds it easier to relate to and work with someone they've actually met in person, rather than a voice on the phone or someone typing into an email or messenger program. When you do meet them, be calm, confident and above all, take time to ask them what they need. I believe that if a potential client spends over half the meeting doing the talking, you're well on your way to a sale. 2. Respond to Messages Promptly & Keep Your Clients Informed

This goes without saying really. We all know how annoying it is to wait days for a response to an email or phone call. It might not always be practical to deal with all customers' queries within the space of a few hours, but at least email or call them back and let them know you've received their message and you'll contact them about it as soon as possible. Even if you're not able to solve a problem right away, let the customer know you're working on it.

A good example of this is my Web host. They've had some trouble with server hardware which has caused a fair bit of downtime lately. At every step along the way I was emailed and told exactly what was going on, why things were going wrong, and how long it would be before they were working again. They also apologised repeatedly, which was nice. Now if they server had just gone down with no explanation I think I'd have been pretty annoyed and may have moved my business elsewhere. But because they took time to keep me informed, it didn't seem so bad, and I at least knew they were doing something about the problems. That to me is a prime example of customer service. 3. Be Friendly and Approachable

A fellow SitePointer once told me that you can hear a smile through the phone. This is very true. It's very important to be friendly, courteous and to make your clients feel like you're their friend and you're there to help them out. There will be times when you want to beat your clients over the head repeatedly with a blunt object - it happens to all of us. It's vital that you keep a clear head, respond to your clients' wishes as best you can, and at all times remain polite and courteous. 4. Have a Clearly-Defined Customer Service Policy

This may not be too important when you're just starting out, but a clearly defined customer service policy is going to save you a lot of time and effort in the long run. If a customer has a problem, what should they do? If the first option doesn't work, then what? Should they contact different people for billing and technical enquiries? If they're not satisfied with any aspect of your customer service, who should they tell?

There's nothing more annoying for a client than being passed from person to person, or not knowing who to turn to. Making sure they know exactly what to do at each stage of their enquiry should be of utmost importance. So make sure your customer service policy is present on your site -- and anywhere else it may be useful. 5. Attention to Detail (also known as 'The Little Niceties')

Have you ever received a Happy Birthday email or card from a company you were a client of? Have you ever had a personalised sign-up confirmation email for a service that you could tell was typed from scratch? These little niceties can be time consuming and aren't always cost effective, but remember to do them. Even if it's as small as sending a Happy Holidays email to all your customers, it's something. It shows you care; it shows there are real people on the other end of that screen or telephone; and most importantly, it makes the customer feel welcomed, wanted and valued. 6. Anticipate Your Client's Needs & Go Out Of Your Way to Help Them Out

Sometimes this is easier said than done! However, achieving this supreme level of understanding with your clients will do wonders for your working relationship. Take this as an example: you're working on the front-end for your client's exciting new ecommerce endeavour. You have all the images, originals and files backed up on your desktop computer and the site is going really well. During a meeting with your client he/she happens to mention a hard-copy brochure their internal marketing people are developing. As if by magic, a couple of weeks later a CD-ROM arrives on their doorstep complete with high

resolution versions of all the images you've used on the site. A note accompanies it which reads: "Hi, you mentioned a hard-copy brochure you were working on and I wanted to provide you with large-scale copies of the graphics I've used on the site. Hopefully you'll be able to make use of some in your brochure."

Your client is heartily impressed, and remarks to his colleagues and friends how very helpful and considerate his Web designers are. Meanwhile, in your office, you lay back in your chair drinking your 7th cup of coffee that morning, safe in the knowledge this happy customer will send several referrals your way. 7. Honour Your Promises

It's possible this is the most important point in this article. The simple message: when you promise something, deliver. The most common example here is project delivery dates. Clients don't like to be disappointed. Sometimes, something may not get done, or you might miss a deadline through no fault of your own. Projects can be late, technology can fail and sub-contractors don't always deliver on time. In this case a quick apology and assurance it'll be ready ASAP wouldn't go amiss. Conclusion

Customer service, like any aspect of business, is a practiced art that takes time and effort to master. All you need to do to achieve this is to stop and switch roles with the customer. What would you want from your business if you were the client? How would you want to be treated? Treat your customers like your friends and they'll always come back.

Research Methodology : Secondary data is collected from various bibliographical sources such as journals, novels, magazines, publications and various websites including the official website of LIC and various other company websites. The published research reports and market studies also helped the researcher to guage into the problem. (This research is fully based on secondary data )

Chapter 5 DATA ANALYSIS AND

INTERPRETATI ON

DATA ANALYSIS AND INTERPRETATION CUSTOMERS

PRECEPTION

TOWARDS

SERVICES LIC 50%

HDFC 30%

ICICI 20%

OTHRS 10%

( LIC IS HAVE MORE CUSTOMERS RATHER THAN OTHERS)

CUSTOMERS RELATIONSHIP DEPARTMENTS LIC 40%

HDFC 30%

ICICI 20%

OTHRS 10%

(IN LIC CRM DEAPARMENTS MOST TO SATISFIED THE CUSTOMERS)

PUBLIC RELATIONS LIC 40%

HDFC 30%

ICICI 20%

OTHRS 10%

IN LIC MOSTLY CENCENTRATE ON PUBLIC RELATIONS LIC POLICIES AND BETTER PLANS LIC 50%

HDFC 30%

ICICI 20%

OTHRS 10%

LIC IS ONE OF FIRST INSURANCE COMPANY WHICH PROVIDE MORE SERVICES Project Analysis The Positive side of LIC as well as Negative side of LIC. I encourage other readers to correct me if I am wrong and also add light to any point that I may have missed. First let’s talk about the Positive side of LIC

1. LIC is owned by the government and therefore it is the only company

besides

the

PPF

that

has

the

sovereign

guarantee of the govt. of India. It is a different story that today LIC has become so powerful that the govt. leans on LIC every time that the Stock Market crashes. Imagine having an Asset base of over Rs 6 Lac Crore. . That’s a 14 digit number! No company in India can boast of such figures. Mind boggling. 2. LIC is the only Life Insurance Company making profits. Most of the Private Insurers including the self proclaimed market leaders like ICICI and Bajaj Allianz are booking heavy losses. Check IRDA website in the Annual Report column. The point is that if an insurance company makes losses year over year, then how will they manage to pay the Claim amount? Afterall no Insurance company is here to do charity business.

3. When it comes to paying claims, again LIC is Number One with the claims settlement ratio of more than 99%. Private Insurers cannot match LIC’s ability on claims settlement. Again, please visit IrDA’s website to see the claims settlement performance of various companies. 4. LIC has the world’s largest sales force, yes over 10 lac agents and now universities in western countries are trying to study how a company managed to appoint such a large sales force. A sales force of over 1 million! Truly a remarkable achievement. 5. Many people argue that LIC has not been able to penetrate the market as it has insured only 15% of the population. My point is, in a poor country like India where there are so many people living below the poverty line, so many people who die of starvation, so many people who don’t have access to basic medication, so many

people who don’t have basic necessities of life like food, shelter, education and clothing. Will such a person first feed his children or buy Insurance ? Lets not forget that a majority of the Indian population is poor and a substantial percentage is living below the poverty line. At a personal level i feel that LIC has done a satisfactory job of insuring people.

Chapter 7

Recommendations and Suggestions

Recommendations

TO CONVERT ALL NEGATIVE POINT IN POSITIVE TO SIT IN FIRST LEVEL IN INSURANCE AREAS FOREVER AND IMPROVE Q.D.C

# NOW THE NEGATIVE POINTS OF LIC #

1. The Administrative staff in LIC is in deep slumber. Try writing a complaint to them and they wont even bother to reply back. If you ask the Branch Manager for the complaints book, he probably wont have it in place. If an Agent complains against any staff, then the Agent is black listed and next time onwards his work is not done. 2. In order to show a better performance & achieve branch Targets, Agents are motivated by the Managers to split the policies. This not only adds to the inconvinience of the policyholders but it also increases the expenses of LIC. Competitions for Agents are held with Prizes being offered on the number of policies sold and not on the number of lives insured. Therefore many Agents are tempted to split the policies in order to get better prizes. However if an agent wants the forms or sales literature,

most

surprisingly just a

of

the

time

its

out

of

stock.

But

week before any scheme is about to close, the office is flooded with forms & sales literature. This is very disturbing. 3, As I earlier said, LIC is lacking in Effective Leadership in recent times.

Managers

having

designations

like

Marketing

Manager or Sales Manager donot have the capability to motivate an audience at a meeting. Yes this is true even in a city like Mumbai. Even the Senior

level

managers

cannot

make

effective

presentations or design a sales strategy. Their only mantra at an Agents meeting is "Friends, bring more policies!’. If you ask them how to bring more policies, they wont know. Its a pity ! 4. Though LIC has more than 2000 branches, they are not systematically located. In Mumbai’s Fort area, LIC has more than 20 branches within a radius of 1.5kms. Whats the use ? In the suburbs where most of the people reside, there are no branches at all. LIC has no branches in Bandra East, Khar East & West,

Santacruz East, Vile Parle East, Andheri West, Jogeshwari West, Mahim, Matunga, etc. If LIC gives a thought to systematic relocation

of

its

offices,

it

will

immensly

help

the

policyholders. 5. Even though LIC claims to have taken several initiatives in the IT sector, policyholders still face problems in revival of their policies, payment of premium in several branches, change of mode, change of address, etc. The After-sales policy services department needs to be revamped. Policyholders feel that LIC agents are humble while selling a policy and thereafter they fail to provide any service to the client. The truth is that LIC is so weak in policy services department, that even a good agent finds it difficult to get the work done from the administrative staff. To sum up, i would say that LIC will never cheat a Policyholder in payment of claim, but at the same time everyone will agree that

LIC is not responsive to the needs of the customer. If you have purchased an LIC policies then dont forget to pay the premium on time, and when your policy gets matured LIC will honestly pay your Maturity amount on time. The employees are sometimes rude in their behaviour with the Policyholder. If a claim cheques is handed over by a courteous and smiling employee of LIC, it will enhance the image of LIC in the mind of the policyholder. Today LIC is not just an Insurance Company, LIC is a Movement, LIC is a Cult, LIC is a Religion. Imagine 10 lac agents and 1 lac employees serving 16 crore policyholders in India. You cannot deny that LIC has become the way of life in India. Daily you can hear someone or the other talking of LIC in local trains, at fish markets, at restaurants, on News Channels, in your own offices, etc.

As i earlier said, LIC has started lacking in effective leadership. If a company like LIC starts sponsoring irrelevant awards like Zee Cine awards which it had done 2 years ago, then it will send the wrong message in the minds of the policyholders. Imagine India’s most famous institution sponsoring a Cine Awards function stating that it was done to increase the brand awareness of LIC. That sounded like a big joke. It is time that the top level officials of LIC come out of

their

air-conditioned

cabins

and

travel

by

public

transport for sometime in order to feel the pulse of the common man.

Why LIC is trusted brand of India?

1. As a Govt of India owned Company, LIC is 51 + years old in the field of life insurance and money management. LIC's Life Fund size as on day is more than Rs 5 Lakh Thousand Crores ! 2. Any LIC policyholder or the nominee will vouch for the best claims settlement from LIC. Perhaps, this is the only institution where you as a policyholder are virtually chased till such time your claim cheques is handed over to you ! 3. LIC has won `NDTV Profit Leadership Award 2007 under Life Insurance Category', `Outlook Money Award 2007 as the best Life Insurer', `CNBC Awaaz Consumer Award 2007 as the best Life Insurance Company', `Golden Peacock Award for excellence in Corporate Governence 2007', `Web 18 Genius of the Web Award 2007 and many more'. 4. LIC adjudged No.1 Trusted Service Brand for the 4th successive year by ET Brand Equity Survey. 5. LIC has been adjudged Superbrand India for 2004-06 and Reader's Digest `Trusted Brand' Asia 2007. 6. This is the only corporation that is catering to more than 190 million satisfied policyholders in India and abroad.

7. This is one of the very few institutions that pays ex-gratia interest on pending maturity claims ! 8. More than 2050 LIC branches all over India are connected together to serve you. You can pay your premium anywhere in the country. 9. During its long existence, LIC has kept on updating its portfolio by bringing in new plans depending on public requirement. More than 50 of them are most popular and can be customized to meet any of your requirements. LIC ULIPs have become extremely popular due to the returns they offer. Money Pluslatest LIC Unit Linked Plan is a case in point. 10. All LIC Plans come with Sovereign Guarantee i.e., Govt of India Guarantee regarding repayment. Infact, as of now, only LIC plans enjoy this Govt Guarantee. Beneficiary for this Sovereign Guarantee is you and you alone as the policyholder/ would-be policyholder. 11. All LIC plans are characterized by low premium, high life insurance coverage and a vast package of benefits offered by them. Add to this package, section 80C benefit and section 10(10D) benefit on the maturity proceeds, you will find investment on LIC plans one of the most coveted investment options available to you.

12. Premium paid under Key-Man Insurance plan is a recognized business expense under section 37(I) of the Income-Tax Act. For companies making profits, this is a very good incentive indeed. 13.

Through

Employer-Employee

Insurance

scheme,

you

can

recognize the worth of your most valuable employees whose absence you can ill afford to loose. 14. Entire contribution to LIC Group Gratuity Scheme is a recognized business expense in the hands of the employer. In addition, through this scheme, the employer can transfer his gratuity liability to the corporation and fund the same under cash accumulation scheme. The most popular among all the companies. 15. LIC is declaring quite an impressive bonus (profits) on all its with-profits policies every year. Extra attraction under LIC Bonus is (a) it is calculated every year on the insured amount and not on the premium paid and (b) entire bonus received along with insured amount either by you on maturity of your policy(ies) or by your nominee in your absence during the currency of your policy(ies) is free from income-tax under section 10(10D) of the Income-tax Act.

16. On most of the LIC plans, you can borrow to take care of your immediate monetary requirements. None of the policy benefits get affected as a result of borrowal. Infact, policy loans offer one of the most attractive investment opportunities. 17. You can pay your premium 3 years in advance at 5% discount. Chief attractions of this advance payment of premium are (a) there is no possibility of your overlooking your premium payment and getting your policy(ies) lapsed wherever you are in the world and (b) you will be earning 5% tax-free interest on the unutilized portion of the amount left with LIC after apportioning the regular installment. 18. Most of the LIC plans come with Riders to take care of Total and Permanent Disablement due to Accident and some of the most dread diseases that may result in loss of income. 19. LIC pension plans that guarantee you life pension are extremely popular. You can park your hard earned money safely with the corporation and enjoy pension as long as you are alive. Due to these reasons and lot more, LIC should be your obvious choice for all your life insurance requirements.

LIC is India’s most trusted brand, INSURING LIVES AND ENSURING SMILES from more than 50 Years. SUPER BRAND & MOST TRUSTED SERVICE BRAND OF INDIA. BEST IT USER IN INDIA (NASSCOM – 2003). Largest Institutional Investor in India and Second largest in Asia among insurers. (Source: Asian Investor) LIC - An Institution Builder promoting many financial and insurance institutes like NSE, NCDEX, LIC Mutual Fund, Stock Holding Corporation of India, National Insurance Academy, Insurance Institute of India etc. LIC is the largest life insurer of India Asset value as on 31.3.2004: 3,673,598.4 mn (INR). Offers over 45 plans to cover your life at various stages Over

160

million

customers

and

1.1

million

agents.

It

has

2019

are

underwritten more than 160 million policies. 2,048

branch

offices

(all

computerized)

of

which

networked ”From all above we can say our money is safe and secure with assured returns.”

Finding Product offered to customer

 Children's Policy Komal Jeevan - Plan No. 159 Children Deferred - Plan no.41 Jeevan Kishore - Plan no.102 Jeevan Chhaya - Plan no.103 Marriage Endowment/Educational Annuity - Plan No. 90 Jeevan Anurag - Plan no.168

 Endowment Policy Endowment with Profits - Plan no.14 Limited Payment Endowment with Profits - Plan no.48 Jeevan Mitra - Plan no.88 New JanaRaksha Policy - Plan no.91 Jeevan Anand Plan no. 149 Jeevan Mitra Triple Cover - Plan no.133

 Group Insurance Policy Janashree Bima Yojana Group Insurance Scheme in lieu of EDLI Group (Term) Insurance Scheme Group Savings Linked Insurance Scheme Group Superannuation Scheme Group Mortgage Redemption Assurance Scheme

 Joint Life Policy Jeevan Saathi - Plan no.89

 Money Back Policy Money Back with Profit - Plan no.75 New Money Back - Plan no.93 Jeevan Surabhi 15 yrs - Plan no.106 Jeevan Surabhi 20 yrs - Plan no.107 Jeevan Surabhi 25 yrs - Plan no.108

Jeevan Bharati Plan No 160 Jeevan Samriddhi Plan No 154, 155, 156 157 Bima Bachat- Plan no.175

 Pension Plans or Annuities New Jeevan Dhara - Plan no.148 New Jeevan Suraksha Plan no. 147 Jeevan Akshay II Plan no. 163 Jeevan Nidhi Plan no. 169 Jeevan Akshay V Plan no. 183

 Special Plans Term Assurance - Plan no.43 Mortgage Redemption - Plan no.52 Jeevan Aadhar - Plan no.114 Market Plus - Plan No 181 Jeevan Vishwas Plan No. 136 Jeevan Saral Plan No. 165 Jeevan Pramukh Plan No. 167 Bima Nivesh 2005 Plan No 171 Money Plus-Plan No 180

 Term Policy Convertible Term Assurance - Plan no.58 New Bima Kiran Term Assurance Anmol Jeevan I Plan No- 164 Amulya Jeevan-Plan No-177

Service Quality Your Policy Bond And Its Safety Your Policy Number Policy Conditions Alterations In Policy If Your Policy Is Lost Your Contact Address – Keep Us Posted Without Fail Admission Of Age Nomination Assignment When To Pay The Premiums Grace Period For Premium Payment How And Where To Pay The Premiums Policy Status – Where Available Revival Of Lapsed Policies Availing Loans On Policies Surrender Value Maturity, Survival Benefits, Disability And Death Claims Policies Under Salary Savings Scheme Helpline

Chapter 6

Conclusion

Conclusion After Finding’s we can see about LIC features and his The tendency to take the expedient approach and focus on the far right of the LIC spectrum, Peacetime Contingency Operations and conduct training as usual, while briefing that the LIC block has been checked, will lead us to a possibly fatal false sense of security. Instinctive behavior and ingrained training must be adjusted to fit new circumstances. STXs must be developed locally or borrowed from units who have already been through the training. The probability of becoming involved in a LIC operation is high. The potential to attract international attention, even with limited forces, is also great. Units have demonstrated that with a balanced training focus and proper preparation, many pitfalls outlined above can be avoided. LIC

is

not

conventional

warfare.

This

is

critical

for

the

counterinsurgent to understand. The insurgent’s violent and coercive strategy is applied so as to achieve political, civil, military and psychological results. Hence, the counterinsurgent must counter all of these strategic elements individually. In

addition, the target of the insurgent’s violence and coercion is the population. This is because the population is the centre of gravity in LIC. Therefore the counterinsurgent

must

also

focus

on

the

population

to

be

successful. In terms of military principles in counterinsurgency, doctrinal precision, professionalism, independence, initiative, force precision, restraint, combined arms, precision engagement, joint force, effective population based intelligence, integrated communications, a civil affairs approach and high levels of training are critical. So all policies and plan toally satisfied the customers.

Chapter 8

B IB L I O GR A PH Y

B IB L I O GR A PH Y

Important websites –  www.google.com(recummented)  www.licindia.com

Magazine  Yogkshem –Lic Magazine

 Outlook Express  Business today  Finance & Banking  Money Outlook

News Paper  Business standard  Times of India  Economic times  Hindustan times