A REPORT

ON

BUILDING BETTER Business

BY

CHAITALI BHATTACHARYA

HDFC STANDARD Life Insurance

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DATE:

A REPORT ON

BUILDING BETTER BUSINESS

BY CHAITALI BHATTACHARYA

07BS1053
(2007-2009)

A report submitted in partial fulfillment of the requirement of MBA Program of ICFAI BUSINESS SCHOOL Distribution List: 1 Prof. HARJEET KAUR Faculty guide ICFAI Business School 2 Mr. HEMANT BHALLA Company guide Manager- Channel Development (HDFC SLIC) 2 |Page

Preface
Experience is the best teacher. The saying plays a very pivotal role in our curriculum where in we try and understand the nuances of the theoretical world with a blend of practical experience. Its very important to understand how and where to implement what we have studied. Knowledge in itself is a continuous process. Getting practiced knowledge is an important thing for existence for any business concern in the competition prevailing in an industry a total awareness is the first and foremost thing necessary from all aspects, working smarter seems to be as important as working harder and longer. We completed this project on BUILDING BETTER BUSINESS in part fulfillment of our MBA curriculum. The knowledge we garnered through this exposure with the outside world will help us in taking a giant leap towards understanding investors behavior and preferences. We discovered the pattern according to which an investor chooses investment vehicle and the factors which influence his/her buying decision.

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ACKNOWLEDGEMENT
Preservation, inspiration and motivation have always played a key role in the success of any venture. In the present world of cutthroat competition project is likely a bridge between theoretical and practical working, willingly I have prepared this particular project. First of all, I would like to thank the supreme power, the almighty god who is obviously the one who has always directed me to work on the right path of my life. With this grace this project could become a reality. I feel highly delighted with the way my project report on topic BUILDING BETTER BUSINESS has been completed. Any accomplishment requires the effort of many people and this work is not different. Firstly, I would like to extend my sincere thanks to Mr. Hemant Bhalla, Senior ManagerChannel Marketing, HDFC STANDARD LIFE INSURANCE COMPANY for his kind cooperation and providing me good environment to work on. I would like to thank Prof. ___________ , Faculty of ICFAI BUSINESS SCHOOL, CHANDIGARH , to provide me the fruitful guidance to complete the project. Finally, I would like to thanks all the faculty members, respondent and other people whom directly or indirectly help me completing the project.

With Regards Chaitali Bhattacharya

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TABLE OF CONTENTS

Serial no. 1 2 3

Particulars Executive Summary Introduction Objective Of The Project Hdfc Standard Life Insurance Company Profile

Page no. 8 9 14 15 16 17 18 18 19 19 20 20 21 21 23 24 27 31 Page no.

4 5 6 7 8 9 10 11 12 13

Company Profile HDFC SLIC Journey Vision statement Of The Company The Life Insurance and HDFC Standard Life HDFC Values & Culture What HDFC Is and Is Not Brand Personality The Making Of A Brand Key Imperatives Of Company HDFCs Customers Sales Module

14 15 16 Serial no.

Sales Manager A key Position In The Org. Career Progression And Growth Sales Manager Job description Particulars

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17 18 19 20 21 22 2223 24 25 26 27 28

Sales Managers Job Profile Sales Managers Function Advisors Recruitment Activities Recruitment Of Life Advisors Life Advisors Life Advisors Function Benefits of Being Life Advisors Activating Non-contributing Life Advisors Process Of Selling Sales Chart Sales Structure Ethics Of Selling Analysis Module

37 38 38 39 40 40 41 42 43 44 45 46 48 50 50 51 51 52 52 55 57 Page no. 60 63

29 30 31 32 33 34 35 36 Serial no. 37 38
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What Is Research? Research Methodology Problem Statement Research Objective Research Design Classification Of Research Design Potential Sources Of Error Data Collection Particulars Sampling Design Sampling Technique

39 40 41 42 43 44 45 46 47 48 49

Sample Size Questionnaire Design Questionnaire Measurement And Scaling Analysis Statistical Tool Limitation Of The Study Financial Planning And Insurance Conclusion Suggestions/Recommendations References

64 65 68 71 73 93 101 103 106 107 108

EXECUTIVE SUMMARY
Management ideas without any action based on them mean nothing. That is why practical experience is vital for any management studies. Theoretical studies in the classroom are not sufficient to understand the functioning climate and the real problems coming in the way of management. So, practical exposures are indispensable to such courses. Thus, practical experience acts as a supplement to the classroom studies.
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The project Building Better Business deals with effective sales technique which include practices to support sales department with business activities, practices to re- activate non contributing Life Advisors, practices to Increase team size. As sales manager is one of the key person of company and generate revenue for the company, it necessary to study the Sales Mangers job description, recruitment and selection process. This project also emphasized on the profile of the sales manager that includes training and recruitment of Life Advisors and managing sales. This project also helps me to study the HDFC values and culture, discover the power of the brand of HDFC and identify the target segment for the company which, as a result, helps in developing a communication skill that is necessary to establishing good relation with client. The HDFC Standard Life Insurance has their definite ethics for selling. The Survey on Investment Pattern of Investors In Life Insurance enabled me to find out the investor behavior for investment. I collected data from investors varying to different age group and income group and tried to find out some basic information about the way they make their financial decision when they want to invest in insurance. In this project, the great emphasis is given to the investors mind in respect to investment in insurance as financial instruments and the needs and wants of the investors.

Introduction
Investor
An investor is any party that makes an Investment. However, the term has taken on a specific meaning in finance to describe the particular types of people and companies that regularly purchase equity or debt securities for financial gain in exchange for funding an expanding company. Less frequently the term is applied to parties who purchase real estate, currency, commodity derivatives, personal property, or other assets.
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The term implies that a party purchases and holds assets in hopes of achieving capital gain, not as a profession or for short-term income.

Investment
Investment or investing is a term with several closely-related meanings in business management, finance and economics, related to saving or deferring consumption. An asset is usually purchased, or equivalently a deposit is made in a bank, in hopes of getting a future return or interest from it.

Investment objective
The major investment objectives are

Safety Income

Growth Of Capital

Tax Minimization Marketability Liquidity

Insurance
Insurance, in law and economics, is a form of risk management primarily used to hedge against the risk of a contingent loss. Insurance is defined as the equitable transfer of the risk of a potential loss, from one entity to another, in exchange for a premium. Insurer, in economics, is the company that sells the insurance. Insurance rate is a factor used to determine the amount, called the premium, to be charged for a certain amount of insurance coverage. Risk management, the practice of appraising and controlling risk, has evolved as a discrete field of study and practice.

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Principles of insurance
Commercially insurable risks typically share seven common characteristics. A large number of homogeneous exposure units. The vast majority of insurance policies are provided for individual members of very large classes. Automobile insurance, for example, covered about 175 million automobiles in the United States in 2004. The existence of a large number of homogeneous exposure units allows insurers to benefit from the so-called law of large numbers, which in effect states that as the number of exposure units increases, the actual results are increasingly likely to become close to expected results. There are exceptions to this criterion. Lloyds of London is famous for insuring the life or health of actors, actresses and sports figures. Satellite Launch insurance covers events that are infrequent. Large commercial property policies may insure exceptional properties for which there are no homogeneous exposure units. Despite failing on this criterion, many exposures like these are generally considered to be insurable. Definite Loss. The event that gives rise to the loss that is subject to insurance should, at least in principle, take place at a known time, in a known place, and from a known cause. The classic example is death of an insured on a life insurance policy. Fire, automobile accidents, and worker injuries may all easily meet this criterion. Other types of losses may only be definite in theory. Occupational disease, for instance, may involve prolonged exposure to injurious conditions where no specific time, place or cause is identifiable. Ideally, the time, place and cause of a loss should be clear enough that a reasonable person, with sufficient information, could objectively verify all three elements. Accidental Loss. The event that constitutes the trigger of a claim should be fortuitous, or at least outside the control of the beneficiary of the insurance. The loss should be pure, in the sense that it results from an event for which there is only the opportunity for cost. Events that contain speculative elements, such as ordinary business risks, are generally not considered insurable.

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 Large Loss. The size of the loss must be meaningful from the perspective of the insured. Insurance premiums need to cover both the expected cost of losses, plus the cost of issuing and administering the policy, adjusting losses, and supplying the capital needed to reasonably assure that the insurer will be able to pay claims. For small losses these latter costs may be several times the size of the expected cost of losses. There is little point in paying such costs unless the protection offered has real value to a buyer. Affordable Premium. If the likelihood of an insured event is so high, or the cost of the event so large, that the resulting premium is large relative to the amount of protection offered, it is not likely that anyone will buy insurance, even if on offer. Further, as the accounting profession formally recognizes in financial accounting standards (See FAS 113 for example), the premium cannot be so large that there is not a reasonable chance of a significant loss to the insurer. If there is no such chance of loss, the transaction may have the form of insurance, but not the substance. Calculable Loss. There are two elements that must be at least estimatable, if not formally calculable: the probability of loss, and the attendant cost. Probability of loss is generally an empirical exercise, while cost has more to do with the ability of a reasonable person in possession of a copy of the insurance policy and a proof of loss associated with a claim presented under that policy to make a reasonably definite and objective evaluation of the amount of the loss recoverable as a result of the claim. Limited risk of catastrophically large losses. The essential risk is often aggregation. If the same event can cause losses to numerous policyholders of the same insurer, the ability of that insurer to issue policies becomes constrained, not by factors surrounding the individual characteristics of a given policyholder, but by the factors surrounding the sum of all policyholders so exposed. Typically, insurers prefer to limit their exposure to a loss from a single event to some small portion of their capital base, on the order of 5%. Where the loss can be aggregated, or an individual policy could produce exceptionally large claims, the capital constraint will restrict an insurers appetite for additional policyholders. The classic example is earthquake insurance, where the ability of an underwriter to issue a new policy depends on the number and size of the policies that it has already underwritten. Wind insurance in hurricane zones, particularly along coastlines, is another example of this phenomenon. In extreme cases, the aggregation can
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affect the entire industry, since the combined capital of insurers and reinsures can be small compared to the needs of potential policyholders in areas exposed to aggregation risk. In commercial fire insurance it is possible to find single properties whose total exposed value is well in excess of any individual insurers capital constraint. Such properties are generally shared among several insurers, or are insured by a single insurer who syndicates the risk into the reinsurance market.

Life Insurance
You think twice before taking the plunge into buying insurance. Is buying insurance a necessity now? Spending an 'extra' amount as premium at regular intervals where you do not see immediate benefits does not seem a necessity at the moment. Well you could be wrong. Buying Insurance cannot be compared with any other form of investment. Insurance gives you a life long benefit and the returns will definitely come but only when you need it the most i.e. at the right time. Besides buying insurance early in life is one of the wise decisions you could take. Because the premium you would be paying would be comparatively lower. Insurance is not about how much more it can offer you when the stock market is at its peak. It may not be an attractive investment option. But weigh the pros and cons and consider how much more it offers at a small price. Most important of all it provides you with that unique sense of security that no other form of investment provides. It gives you a sense of financial support especially during that time of crisis irrespective of the fluctuations in the stock market. Insurance provides for your career goals right from your childhood years. If the earning member of the family is no more your child's educational needs will not suffer. In fact his higher education too will be provided for. You need not spend sleepless nights thinking about how to save for your child's marriage. Life Insurance will take care of that typical once-ina-life-time spending on marriages. An accident or a disability may be devastating but an insurance policy can be of utmost support for the family during such times too. Besides it provides for additional benefits such as bonuses. You need not worry about your retirement years. The rising prices, taxes, and your lifestyle will be taken care of easily. And you can relax and spend your old age in comfort and peace. Life insurance today plays a major role in ones life at various stages. Considering the benefits it offers one cannot but give a thought to buying an insurance policy at the earliest.
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Need for Life Insurance

The need for life insurance comes from the need to safeguard our family. If you care for your familys needs you will definitely consider insurance. Today insurance has become even more important due to the disintegration of the prevalent joint family system, a system in which a number of generations co-existed in harmony, a system in which a sense of financial security was always there as there were more earning members. Times have changed and the nuclear family has emerged. Apart from other pitfalls of a nuclear family, a high sense of insecurity is observed in it today besides, the family has shrunk. Needs are increasing with time and fulfillment of these needs is a big question mark. Insurance provides a sense of security to the income earner as also to the family. Buying insurance frees the individual from unnecessary financial burden that can otherwise make him spend sleepless nights. The individual has a sense of consolation that he has something to fall back on. From the very beginning of your life, to your retirement age insurance can take care of all your needs. Your child needs good education to mould him into a good citizen. After his schooling he needs to go for higher studies, to gain a professional edge over the others - a necessity in this age where cutthroat competition is the rule. His career needs have to be fulfilled.

OBJECTIVE OF THE PROJECT

1. Study the HDFC values and culture, discover the power of the brand and identify the target segment for the company. 2. Developing a communication skill that is necessary to establishing good relation with client. 3. Defining Sales Development Mangers job description, recruitment and selection. 4. Discover effective sales technique which includes
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Practices to support Sales Department with Business Activities.

Practices to Re- activate Non contributing Life Advisors. Practices to Support Sales department with Life Advisor Recruitments. Competition Activity Tracking.

5. Study the Investors Investment Pattern in Life Insurance.

6. To find out the requirement of individual investors, the major causes of financial stress and discuss why people fail to plan.

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HDFC STANDARD Life InsuranceCompany Profile

Company profile
HDFC Standard life insurance ltd is a joint venture company of HDFC bank and Standard Life.HDFC STANDARD Life Insurance is a 74:26 joint venture between HDFC Bank Ltd. and Standard Life. HDFC STANDARD Life Insurance is one of the fastest growing insurance companies in India and has shown remarkable growth since its inception in 2000.

HDFC
HDFC is one of the India s leading institutions, offering complete financial solutions that encompass every sphere of life. From commercial banking to stock broking, to mutual funds, to life insurance, to investment banking, the group to the financial needs of individuals and corporate. The group has a personal worth of Rs.100000 crore and employees in its various businesses with presence in 216 cities in India and offices in New York, London, Dubai and Mauritius, it services a customer base over 1400000. HDFC enjoys leadership position in most of the businesses including stock broking, investment banking and retail lending. With a brand slogan of CUSTOMER SATISFACTION , HDFC enjoys a particularly strong franchise in the arena of investment and capital markets. HDFC is also known for the values of trust, integrity and financial prudence with which entire business
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and franchise is developed .Not only they are the one of the most preferred company to do business with, they are also one of the most preferred employers in the financial services industry.

STANDARD LIFE
Standard Life has used its broad and well-established U.K. base to create a multinational business and is building businesses in the US and Europe that focus on sectors of the market with good fundamentals and where its skills can add value. As at 31 December 2005, 72% of funds under management are in the United States; 24% in South Africa and 4% in United Kingdom .On the embedded value bases the geographic split is 66% Africa, 25% the US and 9% rest of world.

HDFC s Journey

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Vision Statement Of Company

The Global Indian Financial services brand: Their customers will enjoy the benefits of dealing with a global Indian brand that understands their needs and delivers customized pragmatic solutions across multiple platforms. 17 | P a g e

They will be a world class Indian financial service group. Their technology and best practices will be benchmarked along international lines while their understanding of customers will be uniquely Indian. They will be more than a repository of their customers savings. They, the group, will be a single window to every financial service in a customers universe. The most preferred employer in financial services: A culture of empowerment and a spirit of enterprise attract bright minds with an entrepreneurial streak to join us and stay with us. Working with a home grown professionally managed company, which has partnerships with international leaders, gives their people a perspective that is universal as well as unique. The most trusted financial services company: They will create an ethos of trust across all their constituents. Adhering to high standards of compliance and corporate governance will be an integral part of building trust. Value creation: Value creation rather than size alone will be business driver.

The Life Insurance And HDFC Life

The Insurance market was opened up for private companies in year 2000 and currently there are 15 Life Insurance companies in India. HDFC Life Insurance in its fifth year of operations has shown commendable results. In FY 2005-06, HDFC Life Insurance laid special emphasis on strengthening the Quality of Business and succeeded remarkably in the achieving its goals. Instead of just top line growth it has concentrated on better quality business through focusing on long term regular premium business and 90% + persistency. For the second year in succession, it has met the internal value creation target which gives the confidence that going forward it will be able to maintain both aggressive top line growth and reduce losses to achieve break even by 2008-09. The main focus would be to deliver superior value to the key stakeholders and the employees. They have 650 branch offices in 31 cities in India and they are growing aggressively to increase their footprints and bring Life Insurance products to their citizens. From a macro perspective, investment in Life Insurance in developed countries is as much as 4.85% of GDP whereas in India it only accounts for 275%. Hence for the next few years due to under insurance and inherent scope present, private life insurance companies will grow as close to 100% year on year for the next few years until the gap is bridged. One of The key reason for the under insurance has been a monopolistic industry prior to 2000 which led to under development of the market.

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Life Insurance is an integral part of any Financial Planning activity. Typically one could look at least 5-10% of the total Income to be invested towards Life Insurance.

HDFC Values And Culture

The new Indian Entrepreneur -More comfortable with Indian -Is about entrepreneur values which places more importance on growing wealth than protecting wealth.

Organizational culture -About prosperity and creating wealth -Optimistic, Upbeat mood.

What HDFC Is And Is Not

Is Down to earth, Apnapan, optimistic, upbeat. Smart investor, understand how to do business and gain out of it in India, an element of risk. Is Not Sombre & Serious, a Voice of Authority a Gyaani, Cold Efficiency. Protecting money by growth, conservative. trading-off

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Brand Personality
HDFC Brand identity based on consumer perception and group aspiration. Knowledgeable of the latest business practices; has incorporated the best but believes that ultimately successful business decisions are based on instincts rather than logical processes. Values Indian traditional and rituals. HDFC is the quintessential Indian entrepreneur in touch with the global world. Constantly looking for new opportunities to grow business and make money. Believes in no guts, no glory. HDFC is seen as a leader in their field, not only in thoughts but also in their ability to spot opportunities and build on them.

The Making Of A Brand

Started operation in october 2000. Need for private players to establish brands. Need to create a brand platform that would be unique, relevant and emotionally compelling. Based their brand positioning on providing financial freedom- Sar utha kar jeo. Expressed through all customer touch points Ads/Merchandising/Corporate Stationery etc.

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Key Imperatives Of Company

To be a top five player in this industry in this, HDFC Life Insurance need to increase Distribution width and depth trough the country. Insurance is sold primarily through three sales channels: Tied agency network: sales manager recruit and develop life advisers who in turn prospects for customers and sell insurance. It is a tide agency, as these agents (life advisers) are their exclusive sales agents .key to success of a tide agency is that each sales manager has a large number (successful SMs) have a team of 8 to 10 contributing Las) OF LIFE ADVISERS who deliver 3-4 policies month on month consistently. The company helps the sales managers through brand, investment performance, technology, product design and development training and infrastructure and career support .the life adviser inurn earn good commissions and the commission income attracts them to sell more policies. The company in turn has built recognition and communications forums like MY HDFC Life, which is used to recognize performing life advisers.

Alternate channel: sales mangers works with channel partners who can use their channels sales force to sell insurance of their brand. Channel partners in alternate channel can be either a corporate agency or a broker. A corporate agency will always be exclusive for their brand and sell for their company. A broker will be a multiband player and works for the benefit of the customer. Alternate channels sales manager, apart from managing existing partners, identify new partners, built relationships and use the channel sales force to increase sales from that channel.

Group sales: sales mangers sell to corporate /institutions where a group of homogeneous character can be covered under a single insurance policy. Typically they work in the area of employee benefit programme .They sell products like Superannuation, Gratuity, Group Life Covers , EDLI and group credit term covers .Key difference from the first two channels is that this channel does not insure individual lives but insures groups of people.

HDFCs Customer
Male, age 30-45 Sec A/B1 21 | P a g e

 Salaried person, Businessman. Preferably married with children. Interested in protecting family, investment, tax saving, retirement planning, wealth creation.

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This Project is divided into two Modules. I. SALES MODULE

II. ANALYSIS MODULE

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Sales Module

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Sales Manager- A Key Position In The Organization

To achieve goal, the company recruits sales manager. Sales Manger is a key position in the organization and key person to generate revenue.

Role Summary
A sales Managers role is to develop a retail distribution franchise (Financial Consultants which sells Life Insurance Policies on behalf of brand / company. All the Advisors appointed by him are exclusively Life advisors / agents of HDFC Standard Life insurance Limited and they cannot solicit business or become Agents / Life Advisors for any other Insurance Company while they are for them. Life Advisors/ Agents are not employees of the company and hence do not report to Sales Mangers as in the case of employees: one needs to manage the Life Advisors as Retail distributors. He will have to lead by being a good manager and a leader. Towards this, he will need to have a thorough knowledge of his products and be adequately equipped on competition products and other instruments in the market. Initially he may have to assist him in closing sales but please ensure that his role is not to become a direct seller from the company but to make the Life Advisor proficient in selling policies. Successful Sales Managers typically have a retail distribution team of 20-25 Life Advisors. A majority of Life Advisors joins this industry for Recognition and Money. Successful Sales Managers use the rewards & recognition program HDFC Life, offered by the company to drive Life Advisor engagement & performance. Sales Manager report to Branch Manager or Assistant Branch as decided by the company.

Role Description
After being cleared the selection process to become a Sales Manger the following description provides clarity on career within HDFC SLIC.
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 The selection process would test on aptitude, sales personality, selling skills and your sales motivations. He will be given a candid feedback based on those tests for your own improvement. Post his joining, he will undergo a 12 day Training Program which will cover the following: a. A Corporate Induction (covering hdfc Group, vision and values, HDFC, Standard Life, our core competencies and strengths of the group, career with HDFC SLIC and the Group) b. Insurance Basics and Regulations c. Recruitment and selection Skills d. Products & Positioning Pitches e. Consultative Selling The 7 day training program will equip him to get a quick start in the insurance industry even though he may join from any industry. From the first month onwards he will start recruiting Life Advisors with the help of the learning acquired in the Recruitment and Selection Program. His Assistant Branch Manager / Branch Manager will. a. Initially coach him on recruiting skills by helping him select the first three Life Advisors. b. Will make 5-10 accompaniment calls with him along with his Life Advisors to give coaching inputs on Insurance Sales. To equate each Life Advisor to a retail distribution outlet, he will understand that more the outlets, better is the market coverage and hence higher would be the sales turnover. From the Sales Managers perspective, higher the sale, higher is the earning potential & faster is career growth. Hence coverage enhancements are a necessary requirement or enhance your earnings and Agency Sales. The Life Advisors whom he select and appoint will undergo a 100 Hours Statutory Training and Product Training. The 50 hours training is a mandatory IRDA specified training conducted by III (Insurance Institute of India). Candidates can pursuer this
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training either in a Classroom (6 days 2 hrs days program) or alternatively on-line (internet based max. 6 hours a day). Post Training, they will have to appear for an examination conducted by III, on passing the examination, they are licensed to sell insurance products. As mentioned earlier, majority of Life Advisors join this industry for recognition & money. However, a lot of them may never have sold earlier in their careers. It is sales managers job to handhold them in this initial period and help them sell. Once the Life Advisors taste success & earn commissions / recognition, he would tend to be engaged and involved with us. In the 1st 6 months of his journey with HDFC Life, he is clearly expected to build his retail distribution team and then commence business. The expected performance standards, the confirmation criteria and the reward/ incentive program for him is clearly articulated and with his BM. Post confirmation, he is expected to deliver business targets while continuing to focus on distribution build-up. As mentioned earlier, distribution is most critical for his success. He will train his FCs to report activity and Sales as per the Activity Reporting System at his Branch. As a manager he will have to continuously monitors, develop and motivate his Life Advisors to enhance performance and weed out non-performers from his team.

Career Progression And Growth

Career Progression
All newly appointed Sales Managers go through a very carefully designed Training and Development Programme and are gradually built up to reach the performance standards that
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company expect from a HDFC STANDARD LIFES Sales Manager. The development programme of a Sales Manager consists of the following phases: 1. 2. 3. 4. 5. 6. 7. 8. Induction by the Branch Manager or CD - MANAGER. Attendance of Sales Training at a local venue. Selling Insurance for some time. Attendance of Management Training. Appointing people, getting them started and delivering results for the next 12 months. Progressing to higher levels of production year after year. Attendance of Advanced Sales and Management Training on a continuous basis. Making more money and/or progression to higher levels of responsibility. The Induction

The Induction is done as soon as possible after appointment. The purpose is to give the Sales Manager a good introduction into and perspective on the Insurance Industry and also HDFC STANDARD LIFE. Most of their Sales Managers are new to the Industry and all of them to KMOMs approach to Life Insurance.

Attendance of Sales Training at a local venue

The reason for attending Sales Training at a local venue is twofold. Firstly, it is very important that the Sales Manager undergoes the necessary training in preparation for the selling phase. Secondly, it is critical that the Sales Manager forms part of a group of Life Advisers to get the opportunity to observe them, hear how they think about the Business and to develop a better understanding of Life Advisers and their issues. After all, the Life Adviser is the person on whom his success depends on. Later on in their career many Sales Managers are very thankful for having had this opportunity while many others regret the fact that they did not use the opportunity better to enhance their understanding of Life Advisers. Selling Insurance

A crucial part of a Sales Managers experience is to personally experience the selling process and develop the necessary knowledge and skills. After all, how do you teach someone to swim if you cannot swim yourself or ride a bicycle, if you cannot do it yourself? This is one of the most crucial parts of the Sales Managers Development.

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It is true that a Sales Manager is appointed because of having been successful in his/ her previous job. However, the Insurance Industry is vastly different from any other Industry. Here one will have to learn new things and apply some of the old things differently. What better way to learn than actually do the job your Life Adviser is supposed to do with the full backing of the Company in the form of a Branch Manager, T.M., Training and Sales Support. Worldwide experience (including India) also shows that sales experience in his own Industry becomes very important later in his career. Not only does it enhance your credibility, but it may count in your favor when you are considered for certain positions. But even now, in his role as a Sales Manager, this experience will help him to appoint the right people and train and coach them adequately. This is the one opportunity he should use to the full. A newly appointed Sales Managers is expected to sell for at least one month and deliver a certain result. It is important to note that the Sales Manager will start off as if he/she is a Life Adviser. This means doing the P 100, starting with his/her natural market and prospecting further from there. The person will not be given any leads. If it is not done this way, it will defeat the objective of the exercise. Attendance of Management Training

At the end of the selling phase the Sales Manager needs to start recruiting and developing Life Advisers. This signals the start of Management Training. The first module to be attended included Recruitment and Selection and very thorough training on how to develop and motivate Life Advisers. The rest of the First year

On completion of the Selling Phase the Sales Manager enters the Recruitment Phase. During this phase the focus is on recruiting Life Advisers and getting them started. There are very specific targets in terms of the number of Life Advisers recruited, the number of Life Advisers who contribute and the number who produce business above a certain level. The Sales Managers needs to perform at or above these levels to retain his/ her position. However, sales Managers showing results above this level, have the opportunity to earn an incentive. The Second Year

In this year there are certain minimum requirements in terms of recruitment, performing Life Advisers, commission and persistency. He have to perform at these minimum levels to retain his
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position as Sales Manager. However, if he perform above these levels, he will qualify for an incentive. His performance is checked monthly and incentives (if he qualify) paid quarterly. Further Years

In further years the Sales Manager will have a target for each year. His/ her ability to make and beat this target, will determine the amount of incentive. The inability to make the target may jeopardize the Sales Managers position. As the Sales Manager moves form one level to another, he/she will also make progress in terms of seniority, title and promotability to the next level. Further advanced Training

The Sales Manager will have the opportunity to attend further advanced Sales Training Modules as well as further Management and Leadership Training as he/ she advances in his/ her career. KMOM is serious about people development and will continuously provide opportunities to learn and grow. KMOM is also serious about high performance and will continuously reward performers while helping poor performers to become successful. Exiting people will always be a last resort, but will be done, if there is no improvement. Progression to higher levels of responsibility

The Sales Manager will have the opportunity to grow and develop to the extent that he/ she becomes a candidate for promotion to Branch Manager. In Addition there is the opportunity to move across to other areas in the company and/ or be promoted to more senior levels. It all depends on the persons own growth and development, the persons results over time and the profile the company may be looking for in a specific job.

Sales Careers Within HDFC SLIC

A Sales Manager can choose to: a. Remain a Sales Manager and increase size of his Agency and earn handsome incentives.

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b. Or choose to pursue a management career with HDFC SLIC. The first step towards a management career within HDFC SLIC is to become a proficient Sales Manager. After moving through the Career Express system to ABM applicant slab, the Sales Manager can then apply for a Leadership role. The promotion of a Sales Manager to an ABM will be based on Leadership Assessment and not just on meeting the criteria given above. Hence, it is entirely possible that though a Sales Manager has met the Career Express criteria, but cannot clear a Leadership Assessment test, the applicant may not get the role. Exceptional Sales Manager can also seek roles in Training and Marketing functions. These roles will be subject to internal recruitment processes and you will be benchmarked against external candidates for these roles. However, preference will be given to internal candidates as a company policy. Handling Cross Functional Roles will also be relevant to growth beyond ABM grades as this broadens ones perspective of business.

SALES MANAGERS JOB DESCRIPTION

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The KMOM Sales Process is about providing the KMOM service to customers by way of identifying their needs and providing solutions. It comprises the following. Building up a list of suspects Developing a list of prospects. Making appointments with these people. Introducing yourself and KMOM correctly by using the Sales Presenter. Adequate fact finding u sing the Needs Analyzer. The prescribed Needs Analysis. Matching solutions/ products to the needs that arise. Dealing with objections correctly. Closing the deal. Completing the required documentation correctly. Obtaining the required support documentation. Ensuring that underwriting requirements are complied with. Tracking the document flow to completion. Obtaining references as prescribed.

KMOM is very serious about its Sales Process. In a world where financial products have become merely a commodity, their Sales Process represents their value proposition to the customer and the thing that differentiates them from other companies. Following the KMOM Sales process is not negotiable and all Managers are expected to ensure that it is followed correctly at all times. It is crucial that sales manager ensure that his personally understand and follow this process. It then follows that it is crucial that his LAs understand and follow this process without exception. The various aspects of the process is dealt with in the Learning Track for Life Advisers, but it is essential that he reinforces it and constantly check that it is being done correctly. Once he starts managing Life Advisers, always remember that his purpose in life is to build a team of people who not only sell insurance, but also people who provide a service that cannot be matched by any competitor. In order to do this, there are a few crucial components that a Sales Manager has to master.The components can be summarized as follows:
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The simplest way to plan this is to allocate 2 hours a day to each of these or 12 hours per week in a six-day week. The trick is to ensure that not one week goes by in which he has not spent his 12 hours on each of these. It is important to note that the time allocation applies once he has a team of 12 or more in place. Initially (i.e. in the beginning of phase 0) a bigger portion of his time will be spent on Recruitment and less on the other activities. E.g. how can you spend time on Coaching if you have no one to coach yet? But as you appoint people and get to a team size of 12 or more, you should find the balance in terms of time allocation. Experience has shown that successful Sales Managers find the balance as indicate above.

Now let us look at each of these in a bit more detail: Recruitment The Recruitment component consists of a number of activities. They are: Generating Leads. Leads can be generated from your Family, Friends and others you know (Natural Market), through Centers of Influence as well as leads from your Branch Manager, obtained through Company Backed activities like Advertising, Mailing Campaigns, Call Centers and arranged Events. Contacting potential recruits by telephone. First screening on 4x6. Personal History Form and P 100. Arranging Interviews with the Branch Manager. Arranging Training and staying in touch for the duration. Downloading the license.

Monitoring and Admin. The success in Industry depends largely on breaking targets down to daily activities. The key to all of this is to make sure that SMs understand and interpret their activities on a daily basis. This is the starting point of successful team performance.
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The Monitoring component has to do with the Sales Managers job to ensure that the Life Adviser does the job correctly and performs in accordance with his/ her potential. The following activities are crucial.

Goal setting Daily monitoring of activities Weekly progress and review meetings Monthly performance review/ goal setting sessions

Smooth administrations are extremely important. It may not look like a big ticket item in its own right, but if you do not do it properly, it may come back to bite you. It may cause morale problems, low productivity and even harm the image of the company (marking it more difficult to sell) if it does not receive adequate attention. Admin. activities include:

Facilitating allocation of Branch resources. Follow, up of renewal premiums. Facilitate Policyholder servicing. Visit prospects as required for the Moral Hazard Report. Follow, up with Head Office to ensure that proposals are converted to policies.

Training and Coaching Sales Managers are expected to follow a very specific on boarding process with each newly appointed Life Adviser. This process includes. 34 | P a g e

Sit with LA and prioritize the P 100.

Show the LA how to make calls and then observe the LA making calls. Give feedback and repeat until you are satisfied that the LA knows how to do it.

Do joint calls as follows: 4 Joint calls where you demonstrate how to sell. 4 Joint calls where you and the LA each do certain parts. 4 Joint calls where the LA sells and you observe and give feedback. Identify development areas and implement action plans to improve them. Ensure that the LA attends the required Training and that it is reinforced and applied in practice.

The ongoing development of existing LA is equally important. It starts with the identification and rectification of Performance Gaps as well a building on strengths. The key activities are. Determine the potential of the person. Compare potential with actual results and identify gaps and opportunities for building on strengths. Determine the reason foe these gaps and/or the way in which strengths can be built up. Apply the right remedy, be it Training, Coaching, Mentoring or Motivation.

The Coaching activity is crucial and often underestimated. An integral part of this is doing joint calls. This is the purpose of the joint call, to see your LA in action. Joint calls are done for three reasons: He may already have identified a performance gap and now go on joint calls to observe a specific behaviour to determine what needs to be done to improve it. He may have coached an LA on a specific skill and need to demonstrate to the LA how it is done and then in a next call observe the LA to see whether he/ she has mastered it.

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He may just want to observe the LA to pick up strengths that could be reinforced and weaknesses that could be improved. But remember, you never do joint calls just for the sake of doing joint calls, you should always have a clear purpose and make sure that you achieve it. Also, no joint call is complete without preparing the LA beforehand and feedback afterwards. Once you have identified a gap that requires Coaching, you need to follow an effective coaching process. In practice there is more than one way to do this successfully, as long as it contains the following ingredients:

Showing the person how it should be done. Creating the opportunity it practice it in a safe environment. Observing the person in a real life situation. Constant hand holding and feedback until it is fully mastered.

Leading and Mentoring The Sales Manager is in a leadership position. In fact, all successful Sales Managers see their position as MD of their team. A Sales Manager is therefore required to display leadership qualities which includes leading by example. By the nature of our Industry continuous Mentoring of our Life Advisers is very important. But always remember that different people have different needs, Mentoring has to be given to each person where and when it is required. Some people may need a lot and others may require almost nothing. This is one of you most important judgment calls, never follow an approach of one size fits all.

Motivation Many Management Gurus will tell that one cannot motivate a person, that motivation must come within. This is probably true. But then, sales managers most important job is to create the environment within which his Life Advisers can motivate themselves. How he does this? Some ideas could be:

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By crating the desire in the Life Adviser to be successful. Often it is through linking the required performance to achieving something that he/ she really wants.

Creating enthusiasm by bombarding the Life Adviser with good news.

Giving perspective when things go wrong to ensure that minor mishaps are not seen in isolation and allowed to create a negative mindset.

Continually breaking targets down into daily activities and giving recognition for achieving them.

Lots of positive recognition. In the words of The One Minute Manager: Catch them doing something right.

Continually create interesting challenges and milestones bring a lot fun into the business of achieving great results.

Experience has proved that successful Sales Managers are well balanced Managers who give due attention to all aspects of the job and not only parts of it.

Sales Managers Job Profile

Recruitment And Training Programme :

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A Sales Managers role is to develop a retail distribution franchise (Life Advisors which sells Life Insurance Policies on behalf of brand / company. All the Advisors appointed by him are exclusively Life advisors / agents of HDFC STANDARD Life insurance Limited and they cannot solicit business or become Agents / Life Advisors for any other Insurance Company while they are for them. It is sales managers responsibility to trained Life Advisors according to company and IRDA norms so that Life Advisors become equipped for selling insurance.

Sales Management

Managing Sales so that Life advisors work with passion and motivate them with various incentives programme to keep their morale high. Sales Manager properly channelized the sales process so that it will become easy for his Life Advisors to generate leads and conversion of leads. Sales Manager continuously monitors his Life Advisors and his activities. Sales Manager accompanies his Life Advisors while visiting customers. Sales Manager meets with his Life Advisors and handles their concerns and grievances. Sales Manager not only takes care of their active Life advisor but also rejuvenate his non active Life Advisors. He finds out the reason behind non-functional Life Advisors and try to settle their problems and grievances.

Sales Managers Function

Conduct various Advisors Recruitment Activities and find out new platform.

Provide leads to Life Advisors and support the Life advisors for generating sales. Practices to support Sales Department with Business Activities.
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 Practices to Re- activate Non contributing Life Advisors.

Competition Activity Tracking.

Advisors Recruitment Activities

Cold Calling Fish Bowl Activity Classified Ads Project Internship/ Project Trainees. Umbrella Canopies Activities in High traffic areas.

Other Possible Activities

Tapping MLM meetings e.g. Amway, Modicare etc. Community activities targeting schools, housing societies e.g.Drawimg competitions, Health Check up etc. Presentations at Associations/Clubs e.g. kitty parties , Investment Consultant Meets, Small Merchants Association, Stock Broker Meets. Telling Calling.

Recruitment Of Life Advisors

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Life Advisors
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 A Business making others financially and emotionally secure.

A Licensed Representative providing need based advise and service to customer.

An Entrepreneur supported by a Company through product, training and services.

Life Advisors Function

Creates a Network of Customers Relationships through own contacts and referrals.

Achieves above through

Meeting Prospective Customers. Understanding their needs- Insurance and Investment. Providing Suitable Solution and Products. Handling their queries and objections. Closing the sale. Providing Continuous service. Generating Referrals.

Benefits Of Being A Life Advisor

Potential to earn unlimited income. 41 | P a g e

 Flexible Timings.

No capital investments.

Other Benefits

Gratitude of Families.

Status in Society.

Prestige among society.

Network of Contacts.

Good Will of Customers.

Contribution to Nation.

Activating Non-Contributing Life Advisors

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Activating non-contributing done by Sales Manager.

Collecting data of non-contributing Life Advisors.

Calling them.

Fixing appointment and meeting them.

Handling their grievances.

Identify and analyze their need and problems.

Solving them.

Explaining the benefits of being a Life Advisors and new incentives schemes and reward and recognition.

Motivating them and help them to re-activate again.

Assuring them continuous services.

Process Of Selling

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Sales Chart
Sales consist of four equal quarter year. They are Q1, Q2, Q3 and Q4.

Sales Structure
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 Each Branch Manager has 10-12 Area Sales Manager. Each Area Branch Manager has 10-12 Sales Manager. Each Sales Manager has a team of 10-12 Life Advisors.

ETHICS OF SELLING
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HDFC SLICs values strongly focus on doing business which is ethical and has been done with absolute integrity towards its customers, its products, its processes and all its stakeholders. And we have found that it has always paid off in future with the same client being a customer with us across products/services. LIMRA, which is the premier international organization on matters concerning Life Insurance Marketing, has found that ethics in Life Insurance selling consists mainly of putting the interests of the prospect and the client first. Prospects whose needs have been studied, and who have understood how the plans will meet those needs are more likely to purchase than those who have not understood the product completely. Well informed customers are the ones most likely to continue with the policy, which is critical since we are in long term business where the average tenure of policies sold may be as much as 12 to 15 years. Also, since this business is all about networking and references, the customers who have been satisfied with their experience can prove as a great source for future business.

The emphasis for doing ethical business is on:

Placing the best interests of the clients above own direct/indirect interest and not forcing/cajoling the customer into buying a product which the customer does not need. Displaying respect towards all Employees, Life Advisors, Customers at all times and never criticizing any one. Holding in strictest confidence and consider as privileged, all business and personal information pertaining to the clients affairs. Treating all clients equally and fairly. Never making false promises and ensuring that any mis-representation / misleading information or false promises made by others are immediately brought to the notice of the superiors. Making full disclosure of facts to enable clients informed decisions. Showing correct computations where there are high returns.

Compliance in terms of medical reports of the customer, such as accompaniment at time of test, facts about existing illnesses, etc.

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 Not offering rebate to customers, directly or though Life Advisors and discouraging such practices. Not allowing access to the customers / Life Advisors to any confidential company information without authorization from superiors. Making sure that all documents carry the customers consent and not to fill in data / sign on behalf of customer. The documents should be filled in by the customer and if any alternations are required, they should be done by the customer themselves or only after due authorizations have been received. Not giving incomplete documents to the Operations department for processing. Depositing all cash / cheques received from the customer / LA in the company within 24 hours of such receipt. Not using the Companys resources from personal benefits like reimbursement of travel expenses, marketing allowances, etc. Not accepting gratification for doing companys work or any gift / entertainment from customer. Trading on personal account using insider / proprietary information. Not using position with Company for personal gain.

This ethical business by HDFC life Insurance helps company in developing a communication skill that is necessary to establishing good relation with client.

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Analysis Module

What Is Research?
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Research is a systematic and continues method of defining a problem, collecting the facts and analyzing them, reaching conclusion forming generalizations. The systematic and objective identification, collection, analysis, dissemination, and use of information for the purpose of assisting management in decision making related to the identification related to solution to problems and opportunities . Marketing Research is the function that links the customer, concumer, and public to the marketer through information- information used to identify and define marketing opportunities and problems; generate, refine, and evaluate marketing actions; monitor marketing performance; and improve understanding of marketing as a process. The study of research methods provides manager knowledge and skill needed to solve the problems and meet the challenges of a fast-paced decision-making environment. Three factors that stimulate an interest of managers in research study are The managers increased need for more and better information. The availability of increased techniques and tools to meet this need. The result information overload if discipline is not employed in the process.

Research Methodology
Research methodology is a way to systematically solve the problem. It may be understood has a science of studying how research is done scientifically. In it we study the various steps that all generally adopted by a researcher in studying his research problem along with the logic behind them. The scope of research methodology is wider than that of research method. Thus when we talk of research methodology we not only talk of research methods but also consider the logic behind the method we use in the context of our research study and explain why we are using a particular method.

So we should consider the following steps in research methodology: Problem statement

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 Objective of study Research design Data collection Sample design Statistical tool Limitation of study

Problem Statement
The research problems, in general refers to some difficulty with a researcher experience in the contest of either a particular a theoretical situation and want to obtain a salutation for same, there are so many investment options available for the investors, how they invest or choose a particular investment option and what factor they consider more foe investing or choosing a particular investment option and also to find out are they satisfied with their investment decision. In Insurance as an investment vehicle we find out the investment pattern of investor in Life Insurance, their primary reason for investment, reason for choosing HDFC Life Insurance Company for investment and their level of satisfaction and services that could enhance their level of satisfaction.

Research Objective
To understand the investor pattern of investment To find out the difficulties of investors while investing. To find out that which is more popular among investor among various investment vehicle including insurance. To find out that are investor satisfied with their investment decision or not in insurance.

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Research Design
A framework or blueprint for conducting the research project. It specifies the details of the procedures necessary for obtaining the information needed to structure and/or solve research problems. A good research design lays the foundation for conducting the project. A good research design will ensure that the research project is conducted effectively and efficiently. Typically, a research design involves the following components, or tasks:
Define the information needed. Design the research.

Specify the measurement and scaling procedures. Construct and present a questionnaire or an appropriate form for data collection. Specify the sampling process and sampling size. Develop a plan of data analysis.

Classification Of Research Design

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Differences Between Exploratory and Conclusive Research.

A comparison of basic Research Design.

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Research Design used here Descriptive Research Design. A type of research that has as its major objective the description of something-----usually market characteristic or function.

Potential Sources Of Error

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Several potential sources of error can affect a research design. A good research design attempts to control the various sources of error. The Total Error is the variation between the true mean value in the population of the variable of interest and the observed mean value obtained in the marketing research project. Total Error composed of sampling error and non-sampling error.

Random Sampling Error occurs because the particular sample selected is an imperfect representation of the population of interest. Nonsampling Error can be attributed to sources other than sampling, and they may be random or nonrandom.
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Nonresponse Error arises when some of the respondents included in the sample do not respond. Response Error arises when respondents give inaccurate answer or their answers are misrecorded or misanalysed. Surrogate Information Error may be defined as the variation between the information needed for the marketing research problem and the information sought by the researcher. Measurement Error may be defined as the variation between the information sought and information generated by the measurement process employed by the researcher. Population Definition Error may be defined as the variation between the actual population relevant to the problem at hand and the population as defined by the researcher. Sampling frame Error may be defined as the variation between the population defined by the researcher and the population as implied by the sampling frame (list) used. Data Analysis Error encompasses errors occur when raw data from questionnaires are transformed into research findings. Respondent Selection Error occurs when interviewers select respondents other than those specified by the sampling design. Questioning Error denotes errors made in asking questions of the respondents or in not probing when more information is needed. Recording Error arises due to error in hearing, interpreting, and recording the answers given by the respondents. Cheating Error arises when the interviewer fabricates answers to a part or all of the interview. Inability Error results from the respondents inability to provide accurate answers. Unwillingness Error arises from the respondents unwillingness to provide accurate information. Nonsampling error are more problematic than sampling error. Sampling error can be calculated, whereas many forms of nonsampling error defy estimation. A large sample size has been selected to reduce sampling error.

Data Collection
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The task of data collection is begins after a research problem has been defined and research designed/ plan chalked out. Data collection is to gather the data from the population. The data can be collected of two types:

Primary Data Secondary Data

Primary Data
The Primary Data are those, which are collected afresh and for the first time, and thus happened to be original in character.

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Secondary Data
The Secondary Data are those which have already been collected by someone else and which have already been passed through the statistical tool. Methods of collection of Secondary data By Source By Category By Medium By Data Base Format In our case we relied on secondary source of data as sources are take from Sales Managers and their Life Advisors. However we have taken the help of different websites and journals to form the structure of our questionnaire.

Advantages And Uses Of Secondary Data

Identify the problem Better define the problem Develop an approach to the problem. Formulate an appropriate research design. Answer certain research questions and test certain hypotheses. Interpret primary data more insightfully.

Disadvantages Of Secondary Data

Because secondary data have been collected for purposes other than the problem at hand, their usefulness to the current problem may be limited in several ways, including relevance and accuracy. The objective, nature, and methods used to collect the secondary data may not appropriate to the present situation. Also, secondary data may be lacking in accuracy, or they may not be completely current or dependable. Before using secondary data, it is important to evaluate them on these factors.

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Sampling Design
A sample design is a definite plan for obtaining a sample from a given population. It refers to the technique or the procedure and the researcher would adopt in selecting items of sample. Sample design may as well lay down the number of items to be included in the sample i.e. the size of the sample. Sample design is determined before data are collected. Before going trough sampling design, let us learn some terms. Population: The aggregate of all the elements, sharing some common set of characteristics, that comprises the universe for the purpose of the research problem.

Census: A complete enumeration of the elements of a population or study objects.

Sample: A subgroup of the elements of the population selected for participation in the study.

Target Population: The Collection of elements or objects that possess the information sought by the research and about which inferences are to be made.

Element: Objects that possess the information sought by the research and about which inferences are to be made.

Sampling Unit: The basic unit containing the elements of the population to be sampled.

Sampling Frame: A representation of target population. It consists of a list or set of direction for identifying the target population

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The Sampling Design Process

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Target Population
The target population for the investment pattern in Life Insurance survey is defined as follows: Elements ---Male or Female head of the household responsible for investment in life insurance in HDFC Life Insurance. Sampling Units---Investors investing in HDFC Life Insurance. Extent---Chandigarh, Mohali and Panchkula. Time---2008.

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Sampling Techniques

Sampling Technique used in survey--- Nonprobability Sampling Techniques.

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Convenience Sampling.

Nonprobability sampling techniques do not use chance selection procedures. Rather, they rely on the personal judgment of the researcher where as probability sampling procedure each element of the population has fixed probabilistic chance of being selected for the sample. In our survey, we have used nonprobabilty sampling technique because there is no way of determining the probability of selecting any particular element for inclusion for the sample, the estimates obtained are not statistically projectable to the population. We have selected the sample with help of Sales Manager and their Life Advisors. Among nonprabability sampling techniques, the sampling technique applied here is convenience sampling. Convenience Sampling attempts to obtain a sample of convenient elements. The selection units is left primarily to the inerviewer. Convenience Sampling is the least expensive and least time consuming of all sampling techniques. The sampling units are accessible, easy to maesure, and cooperative. In spite of these advantages, his form of sampling has seroius limitations. Many potential sources of selection bias are present, including respondent selfselection. Convenience Samples aer not representative of any definable population.

Sample Size
The sample size used for our survey is 300. In order to minimize the sampling error, large sample size is chosen.

Questionnaire Design
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A Questionnaire, whether it is called a schedule, interview form, or measuring instrument, is a structured technique for data collection that consists of series of question, written or verbal, that a respondent answers.

Objective Of A Questionnaire

It must translates the information needed into a set of specific questions that the respondents can and will answer.

A questionnaire must uplift, motivate, and encourage the respondent to become involved in the interview, to cooperate, and to complete the interview.

A questionnaire should minimize response error.

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Questionnaire Design Process

Type Of Interviewing Method

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In our survey, we have used Personal Questionnaire.

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Questionnaire

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Measurement And Scaling

The assignment of numbers or other symbols to characteristics of objects according to certain prespecified rules. Scaling is the generation of a continuous upon which measured objects are located.

Primary Scales Of Measurement

In our questionnaire, Q1 , Q4 and Q5 are in ratio scale , Q1 is in nominal scale, Q7 are in ordinal scale and Q11 is in interval scale.

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Scaling Techniques

In our questionnaire, Q6 is in rank order scaling. It is a comparative scaling technique in which respondents are presented with several objects simultaneously and asked to order or rank them according to some criterion. Q11 is in Likert Scale. It is a measurement scale with five response categories ranging from highly unsatisfied to highly satisfied.

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Analysis
The analysis of this project begins with analysis of each question.

Q1. Age Group:

Age (in Yrs) No. Of Respondents

18-30 60

30-40 75

40-50 75

50-60 45

Above 60 45

Fig 1:

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Q2. Sex Ratio:

Sex No. Of Respondents

Male 184

Female 116

Fig 2:

Fem ale 39% Male 61%

Q3. Occupation:
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Occupation Business Govt.Emp. Pvt.Emp. Retired Student Homemaker

No. Of Respondents 80 71 78 22 Nil 49

Fig 3:

Q4. Annual Income(in lacs Rs.):

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Annual Income(in lacs Rs.) No.f Respondents

>2.5 90

2.5-3.5 75

3.5-4.5 60

4.5-5.5 45

Above 5.5 30

Fig 4:

Q5. Annual Investment(in lacs Rs.):

Annual Income(in lacs Rs.) No.f Respondents >0.5 98 0.5-1.5 67 1.5-2.5 70 2.5-3.5 35 Above 3.5 30

Fig 5:

Q6. Investment Ratio:

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Investment Vehicle Bank FD Equities Insurance Mutual Funds Govt. Bonds Real Estates Others

No. Of Respondents who has given their major investment ratio 35 33 52 78 31 52 19

Fig 6:

Real Estates 19% Govt Bond 11% Mutual Fund 28%

Bank FD 12%

Equities 12%

Insurance 18%

Because of portfolio diversification and diversification of risk, most of the investors consider mutual fund as a better investment vehicle for investment than others. Most of the investors have given their major investment ratio in mutual funds as mutual funds can be easily liquidated.
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Investment in a mutual fund is more liquid. An investor can liquidate the investment by selling the units to the fund. After MF, they prefer insurance and real estates. Insurance is preferred for the reason of risk coverage, security, future protection and provides tax benefit. Products under Unit Linked Investment Plan (ULIP) has made insurance more attractive for investment. Investors also have shown their inclination for investment in real estates. Real estates is a booming sector and because of growing economy , it is considered as a good investment avenue. There are some investors who like risk and thus invested their major ratio of investment in equities to get high returns but most of them risk averse. In order to hedge risk and getting regular income, there are investors who preferred to invest in Bank FD and Government Bonds. These investment vehicles are exposed to least risk among all investment vehicles and promised a regular income, that why it is preferred by some investor.

Q7. Reasons For Investment:

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Reasons for Investment Savings High Returns Tax Benefits Security

Priority 1 76 90 80 54

Priority 2 54 80 90 76

Priority 3 90 76 54 80

Priority 4 80 54 76 90

Fig 7:

Reasonsfor Investm ents

Security 18% Savings 25%

Tax Benefits 27%

High Returns 30%

This graph depicts that most of the investors primary reason for Investment is high returns, then tax benefits, then savings and then security. Thus investors invest on those investment vehicles which give him/her maximum and profitable return. Investors also invest in those investment vehicles which provide tax benefit so that they can save tax. Though most investors primary reason for investment is not saving and security yet there are some people who dont ignore these features and invest after analyzing the level of protection and future security and amount saved for future.

Q8. Reason For Choosing HDFC Life Insurance

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Reason For Investment In HDFC SM/Agent Track Record Brand Name Flexible Products Allocation Charges Profitable Returns

No. Of Respondents 90 39 34 31 35 71

Fig 8:

Reason For Investment In HDFC SLIC

Profitable Returns 24% SM/Agent 30%

Allocation Charges 12% Track Record 13% Brand Name 11%

Flexiable Products 10%

Most of the investments made by the investors because of references generated by the Sales Manager or by his Life Advisors. Thus Sales Manager is considered as key person in the organization and key person to generate revenue for the organization. So organization cannot
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ignore the contribution of Sales Manager and the business produced by his Life Advisors. Company have to keep motivate their Sales Team by rewards and recognition. Investors also invested in HDFC Life Insurance because profitable returns. High return also one of the primary reason for investors for investment in different products of HDFC Life Insurance. Company also made a brand and have good track record. Company provides good services to their customers and maintains their satisfaction level. They give proper clarity on products, information regarding newly launched product and information about claim settlement. They benefit their customer by easing in depositing premium. Sales Manager supports these all services provided to customer. The Company positioned themselves as The Global Indian Financial services brand The most preferred employer in financial services The most trusted financial services company Value creation These features of Company has been attracted many investor for investment in HDFC Life Insurance. Companys good fund management, products allocation chargers and flexible products drawn investors interest for investment in Company.

Q9. HDFC Life Insurance Products:

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Product Eternal Life Plan Child Plan Term Plan Retirement Plan Endowment Plan ULIP Flexi Plan Money Back Plan

No. Of Respondents 36 46 37 41 12 68 29 31

Fig 9:

Eternal Life Plan 15% ULIP 28% Child Plan 19%

Endowm ent Plan 5%

Retirem ent Plan 17%

TermPlan 16%

Q11.Leval Of Satisfaction:

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Level Of Satisfaction Highly Satisfied Satisfied Moderate Unsatisfied Highly Unsatisfied

No. Of Respondents 30 170 90 7 3

Fig 10:

Q12. Enhance Level Of Satisfaction

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Reasons To Enhance Level Of Satisfaction

No. Of Responde nts 85 79 59 41 33

Services From Life Advisors Clarity On Product Ease In Depositing premium Information About Claim Settlement Information Regarding Newly Launched Product Total

297

Fig.11

Q13.Looking For Further Investment.

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Response Yes No

No. Of Respondents 167 133

Fig.12

Out of pool of 300 investor , only 167 investors have decided to invest further in HDFC Life Insurance. They are mainly interested in investing products came under ULIP mainly Smart Advatage, HDFC Investment Plan and Child Plan.

Now we will show the investment pattern of investors in life insurance through different relationships.

Sex Ratio Vs Reasons For Investment:

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Reasons for Investment Savings High Returns Tax Benefits Security Total

Male 40 60 50 34 184

Female 36 30 30 20 116

Fig.13

Male and female always have different perception for investment. They have different primary reasons for investment. Men are less risk averse as compared to female. Thus males invest in those investment vehicle which gives high and profitable returns. Their priority for investment is high returns whereas females always invest for saving. Their major reason for investment is saving. Thus, female investors prefer insurance among all investment vehicles. Another reason for investment is tax benefit. Since, in India most of the working class consists of males thus they invest on those investment vehicles where they could save tax. Increasing population of working women also drawn intention of investment for tax saving. Female investors also prefer to invest for security than male.

Age Vs Reason Of Investment:

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Reasons for Investment Savings High Returns Tax Benefits Security Total

18-30

30-40

40-50

50-60

Above 60 15 10 4 16 45

11 25 16 8 60

16 29 20 10 75

16 19 30 10 75 5

18 7 10 10 4

Fig.14

30 25 20 15 10 Savings High Returns Tax Benefit Security

t d n p s e R f O . o N

5 0 18-30 30-40 40-50 Ag eG roup 50-60 Above 60

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Also different age groups have different reasons for investment. As age increases, reason for investments also changes. At the age between 18-30, people are more likly to expose risk and they invest mainly because of high returns. Here savings and security are not priority for investments. At the age between 30-40, investment are done by investors because of high returns but tax benefit also start influencing their investment pattern. Here they come under tax norms and it become necessary for them to save tax and it could be done only by investing in tax saving investment vehicles. As age increases from 30 to 50 , tax benefit become main reason for investment. Here people also start savings for future and their loved ones. They also consider security before investment. At age 50-60, people are in verge of retirement so they save more. Here main reason for investment is saving and not high returns. Above 60 are group of retired persons mostly, thus they use their savings. Here investment is not done and if any then done primarily for savings.

Sex Vs Investment Vehicle:

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Investment Vehicle Bank FD Equities Insurance Mutual Funds Govt. Bonds Real Estates Others Total

Male Respondents 16 25 31 47 14 39 12 184

Female Respondents 19 8 21 31 17 13 7 116

Fig.15
Male Investment Pattern:

Fig.17
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Female Investment Pattern:

Through this survey we came to know that males and females have different investment patterns. Males, as discussed earlier, like to expose to risk than females thus invest more on equities. Mutual Funds is favorite among both males and famales because of diverification of risk and porfolio and it could be easily liquidated. Also males have more interest in real estates than females. We already discovered that most females primary reason for investment is saving rather than high return thus insurance as investment vehicle is more popular among females than males. Females consider insurance as safe investment and thus they dont have any hesitation for investment. So insurance companies including HDFC Life Insurance not only target male customers but also positioned themselves among females. Females also show more interest for investment in Bank FD and Govt.Bonds than males . This also shows females are more prone to the need for safety, security and protection than males. Thus the attitude of females help insurance company to tap females too. Other investment options are derivative market, commodity market and gold in which males are more interested.

Age Vs Investment Vehicles:

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Investment Vehicle Bank FD Equities Insurance Mutual Funds Govt. Bonds Real Estates Others

18-30 2 7 7 20 5 10 9

30-40 3 10 8 19 5 21 5

40-50 10 10 14 18 5 13 5

50-60 10 3 12 7 8 5 0

Above 60 10 3 14 7 8 3 0

Fig.18
80 70 60 50 40 30 20 10 0 18-30 30-40 40-50 Ag eG roup 50-60 Above 60 Others Real Estates Govt. Bonds Mutual Funds Insurance Equities Bank FD

Another relationship we developed through this survey is the relationship between age and investment vehicles. Investment in Mutual Fund is done by every age groups but it is prominent investment vehicle among investors lies between age group 18- 50. After that their inclination for investment are towards insurance for saving purpose and get insured to safeguard their life and family. Insurance is always considered as good investment vehicle for tax benefit purpose among all age groups but most of them lies between 40-60. So insurance companies target the
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t d n p s e R f O . o N

customer whose age lies between 40-50. HDFC Life Insurance Companys target customers are above age of 35. Thus their marketing strategy matches with our survey pattern. Investment in real estates is prominent among investor lies between age group 30-40 as at this age investors realizes the importance of real estates and gain confidence for investment. Also more planned investment begins from the age of 30 onwards.

Statistical Tool
In this project following statistical tools are used.

Chi-Square Test
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Introduction The chi-square test (x2 -test) is an important test among the several tests of significance developed by the statisticians. The x2-square test (pronounced as chi-square test) is one of the simplest and most widely used non-parametric tests in statistical work. The chi-square test first used by KARL PEARSON in the year 1990. The quantity chi-square describes the magnitude of the discrepancy between theory and observation. It is defined as: x2 =
(O E)2

E Where O refers to the observer frequencies and E refers to the expected frequencies. The chi-square statistic used to test the statistical significance of the observed association in a cross tabulation. It assists us in determining whether a systematic association exists between the two variable. Steps to determine the value of chi-square, these steps required are: 1. Calculate the expected frequencies. In general the excepted frequencies for any call can be calculated from the following equation: E = RT X CT N E = Expected frequency RT = The row total for the row containing the cell. CT = The column total for the column containing the cell. N = The total number of observation
2. The take the difference between observed and expected frequencies and obtained the

square of these differences i. e. obtained the values of (O E)2.

3. Divide the value of (O E) 2 obtained in step(2nd) by the respective expected frequency

and obtained the total [(O E)2/ E].Gives the value of chi-square which can range from Zero to infinity. If chi-square is zero it means that the observed and expected frequencies
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completely coincide. The Greater the discrepancy between the observed and expected frequencies, the greater cell be the value of chi-square.

The calculated value of chi-square of is compared with the table value of chi-square for given degrees of freedom at a certain specified level of significant. If at the stated level (generally 5% level is selected), the calculated value of chi-square is more than the table value of chi-square, the difference between theory and observation is considered to be significant.

Degrees of freedom While comparing the calculated value of chi-square with the table value we have to determine degrees of freedom. By degrees of freedom we mean the number of classes to which the value can be assigned arbitrarily or at without violating the restrictions or limitations placed. For example in a contingency table the degree of freedom calculated in a different manner. The marginal total of frequencies places the limit on our choice of selecting cell frequencies. The cell frequencies of all columns but one ( C 1) and of all rows but one (R -1) can be assigned arbitrarily and so the number of degree of freedom for all the cell frequencies is = (C 1 ) ( R -1) where c refers to column and R refers to rows. Thus in a 3 X 3 table the degree of freedom = (3 1) (3 -1) = 4.

Application of tool In a sample of 300 investor, we are going to establish a significant relationship between income and investment.
Investment (in lacs Rs) 94 | P a g e >0.5 0.5-1.5 1.5-2.5 2.5-3.5 <3.5 Total

Income(in lacs Rs) <2.5 2.5-3.5 3.5-4.5 4.5-5.5 Above 5.5 90 8 98 67 67 60 10 70 35 35 30 30 90 75 60 45 30 300

Grand Total(GT)

Let us define null and alternative hypothesis.

Ho: There is no significant relationship between income and investment.

H1: There is significant relationship between income and investment.

X2 ANALYSIS

S.No 1 2
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90 8 29.4 24.5 60.6 -16.5

3672.36 272.25

124.91 11.11

3 4 5 6 7 Total

67 60 10 35 30 300

16.75 14 10.5 52.5 30

42.5 46 -0.5 -17.5 0

1806.25 2116 0.25 306.25 0

150.75 151.14 0.023 5.83 0 437.933

Therefore, X2 cal= 437.933

Degree of Freedom (d.o.f): (r-1) (c-1) = (5-1) (5-1) = (4*4) =16 At 5% Level of significance and d.o.f 16
X2 tab = 7.962 Since X2 cal > X2 tab. Therefore, Reject Null Hypothesis.

Conclusion: Since the calculated value of chi-square is more than the table value, we
reject the null hypothesis and conclude that there is a significant relationship between the investments by the investor and their income.

Correlation
Introduction In our day-to-day life, we find many examples when a mutual relationship exists between two variables i.e. with fall or rise in the value of one variable, the fall or rise ay take place in the value of other variable. For example, price of a commodity rises as the demand for the commodity goes up. Upto a certain time-period, weight of a person increases with the increase in the age. Similarly, the temperature rises with the rise in the sunlight. These facts indicates that
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three is certainly some mutual relationship that exists between the demand for a commodity and its price, the age of a person and his weight, and the sunlight and temperature. The correlation refers to the statistical technique used in measuring the closeness of the relationship between the variables. Definition of Correlation Some important definitions of correlation are given below: Correlation analysis deals with the association between two or ore variables- Simpson and Kafka. If two or ore quantities vary in sympathy, so that movement in one tend to be accompanied by corresponding movements in the other, then they are said to be correlated-Conner Correlation analysis attempts to determine the degree of relationship between variables- Ya-LunChou Formula r = (X i (X n))(Yi (Y n)) (X i (X n))2 (Y i (Y n))2

Where r coefficient of correlation, indicates the strength of association between two metric variables. It ranges from -1 tom+1. X n and Y n are samples mean. Here samples are income and investment. Income (X) is independent variable and Investment(Y) is dependent variable. n is total no. of samples.

S No. 1 2 3 4 5

Income(Xi) 90 75 60 45 30

Investment(Yi) 98 67 70 35 30

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Total

300

300

X n = 60. Y n = 60. Here n is 5 (X i (X n))(Yi (Y n)) = 61680 (X i (X n))2 = 2250 (X i (X n))2 = 3118 Putting these values in above formula we get the value of r as: r = 0.714. Conclusion: The positive value of r indicates a positive relation between income and investment. Also the value of r indicates that there is significant association between income and investment. HDFC Life Insurance generally target customer in affluent group i.e. customers having income lies above 3.5 lacs. So HDFC SLIC marketing strategy matches with our analysis.

Bivariate Regression
Introduction It is a procedure for deriving a mathematical relationship, in the form of an equation, between a single metric dependent variable and a single metric independent variable. The analysis is similar in many ways to determining the simple correlation between two variables. However, because an equation has to be derived, one variable must be identified as the dependent variable and the other as the independent variable. Formulate the Bivariate Regression Model In the Bivariate regression model, the general form of a straight line is:
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Y i = a + b Xi Where Y i is the estimated or predicted value of Yi . The constant b is usually referred to as the nonstandardized regression coefficient. Ti is the slope of the regression line and it indicates the expected changes in Y when X is changed by one unit. The constant a is the intercept to the Yaxis. b= (X i (X n))(Yi (Y n)) (X i (X n))2 = Xi Yi n ((X n) (Y n)) Xi 2 - n ((X n) a = (Y n) b (X n) Xi Yi =20250 Xi 2=20520 So the values of b comes as : b = 0.89 and value of a is : a = 6.43 Therefore, the Bivariate regression model comes to be: Y i = 6.43 + 0.89 Xi Conclusion: The model represents that there is linear relationship between income and investment. As persons income increases, he/she invests more to take maximum benefits of investments. As principle amount for investment increases, more growth and benefit could be obtained.

Fig.19: Scatter Diagram

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LIMITATION OF THE STUDY

Research
In every research there are chances of errors and constraints there will be following limitations of study.

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 Sample Size, which is taken, is small, on the basis of which efficient design cannot be taken. The time will also very limit. There will so many investment plans available but comparison between all the plans is difficult. Data collection might be subjected due to personal preferences of different investors.

Customers
Customers do not have any idea about their future goals. They do not want to disclose their whole life planning. Consider financial planning expensive. Most of People think about tax planning at the end of financial year. Most people still have faith on LIC, and dont have faith on private firms.

Sales Manager
They never came direct contact with customers. They cant keep track with all Life Advisors. They keep in touch with only good performing Life Advisors.
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 Budget constrain for doing different sales activities to generate leads.

Financial Planning And Insurance

Financial planning is the process of assessing your financial goals, taking an inventory of the money and other assets you already have to help you reach those goals, and estimating what you will need in the future. Financial planning also required while investing in insurance Financial planning in insurance includes:

Using a monthly spending plan, or budget, to keep your finances on track.

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Making decisions about your job and job benefits.

Getting the most out of other financial resources, including insurance and government assistance.

Saving and investing money.

Controlling expenses and staying out of debt.

Planning your estate.

BENEFITS
Financial planning provides direction and meaning to your financial decisions. Financial planning allows you to understand how each financial decision you make affects other areas of your finances. By viewing each financial decision in insurance as part of the whole, you can consider its short and long-term effects on your life goals. You can also adapt more easily to life changes and feel more secure that your goals are on track.

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Process

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Why peoples do financial planning in insurance?

To get value of money in financial planning. To minimize the defer income tax & government levies. To maximize return on investment at a reasonable level of risk. To accumulate the savings for significant family needs. To have sufficient saving & income for retirement. To have a necessary capital available in case of unexpected loss of income or savings

Common mistakes people do while doing financial planning

Dont set measurable goals. Make a financial decision without understanding its affect on other financial issues. Confused financial planning with investing. Neglect to re-evaluate their financial plan periodically. Think that financial planning is only for the wealthy peoples. Think that financial planning is for when they got older. Think that financial planning is the same as retirement planning. To wait until a money crisis to begin financial planning. To expect unrealistic returns on investments.
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Conclusion
I am finally like to conclude this project with a great feeling of having gained enormous knowledge about the insurance industry. First of all are thankful to HDFC Life Insurance who gave us such a wonderful opportunity to learn about the practical aspects of knowledge. While making the project I learnt how to communicate or deal with prospective investors and how to maintain contacts with them. I saw all the marketing factors governing insurance industry as well as marketing strategies of HDFC Life Insurance and was able to understand more about it because of seeing them practically. It has been said that practical knowledge is more important than theoretical knowledge. I learnt how to work in peoples business. I learnt how to relate the goal of the company SAR UTHA KE JEO with the most sensitive part of any persons life namely the persons own and family well being and dreams and aspiration. I learnt the selling of Insurance and the sales effort stands or falls by the effectiveness of the Sales Manager. The role of Sales Manager in the Life Industry is currently being hailed as one of the most exciting, challenging and rewarding career ever. Sales Managers are the base of better business because he is one who builds better business. I also learnt how to interpret and analyze the data and suggest the best possible ways to position products of HDFC Life Insurance. Lastly we are obliged to those who helped us from the beginning to the end for giving us an excellent of present scenario of market. Whatever we learnt from market research will definitely help in enhancing our academic career and come up as an efficient manager.

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Suggestions/Recommendations
HDFCs marketing strategy is to target affluent income group (above 3.5 lacs).though this strategy is really working for the company yet from our survey we have found that a big number of investors falls between 2.5 lacs-3.5 lacs. Thus HDFC should come up with a new marketing strategy to position itself more effectively in this particular group. We have found from our marketing survey that the number of female investors in insurance is lesser than male investors but females are more inclined towards investing in life insurance. Their primary reason for investment is safety and moderate growth of their capital with less risk. So HDFC must come up with those plans which can cater the needs of its female investors.
Because of highly competitive insurance market, every company

recruits more and more life advisers. This causes the recruitment of poor quality of life advisers which ultimately put burden on company without generating any business for it. HDFC need to concentrate on quality of recruitment rather than quantity of recruitment. Most of the companys investors are moderately satisfied their investment. So the company should work to enhance level of satisfaction if its investors. This will help HDFC to retain its existing investors as well as to attract new investors for company.
Team work the fuel that allows common people to produce

uncommon results. HDFC SLIC should arrange some programs for enhancing the cooperation among its sales managers. Instead of becoming competitor, they could work as a team to generate better business. HDFC SLIC should arrange mutually beneficial employee awareness session at different organization to:
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Safeguard interest of customers. Fight back Mis-selling. Conduct its social Responsibility.

REFERENCES
MAGAZINES : HDFC SALES CONCEPT HDFC BRAND PLUS HDFC PRODUCT RANGE HDFC SALES MANAGERS HANDBOOK BUSINESS WORLD ECONOMIC TIMES WEBSITES REFERRED : www.hdfcstandardlife.com

Books:

Prasanna Chandra Investment Analysis & Portfolio Management, Tata MC Graw-Hill Publishing Company Ltd., 2nd Edition. Kothari C.R. Research Methodology; New Age International

Publications, 2nd Edition.

Financial Management The ICFAI University. Business Research Methodology The ICFAI University. Malhotra K. Naresh Marketing Research An Applied Orientation , 4 th Edition.

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