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Contents Preface Acknowledgement Executive Summary Introduction Overview Of The Industry Overview Of The Company Marketing and Sales Department Human Resource Department Operations Department Recommendations and Suggestions Bibliography Annexure

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Chapter 1:

Chapter 2: Chapter 3: Chapter 4: Chapter 5:

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PREFACE
Insurance market is growing very fast. The opportunity is also high in this sector as only 5% of Indian market is covered by this sector and the players are trying to extend in to the rest untapped 95%. The insurance industry in India has been growing at a remarkable pace after its opening to the private players. Entry of new players into the industry has increased the competition which facilitated insurance companies to design newer insurance products according to the needs of insured. In a country like India where insurance penetration is not so high, there should be an intermediary between the insurers and insured who would not only identify and analyse insurance needs of insured but also advise the insurance companies in designing the insurance products accordingly. Insurance brokers play the role of professional risk & insurance advisors who advise the client by analysing the operational risk exposures of the client and getting proper insurance policies with the best lowest premium determined from amongst competing insurers.

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ACKNOWLEDGEMENT

There is always a sense of gratitude which one express to other for the helpful so needy services they render during all phases of life. We would like to express our gratitude towards all those who have been helpful to us in getting this mighty task of training to a successful end. First of all, I consider it a pleasant duty to express my heart felt appreciation, gratitude and indebtedness to Mr. Pragnesh Soni for his keen interest, invaluable pain taking & excellent guidance, patience, endurance, encouragement & thoughtful advice throughout the project work duration. I would also like to be thankful to Mr. Mehul Ganjawal who has given us the right way to prepare our project report at regular intervals whenever any query aroused in our mind. And last but not the least we would like to greet heartily Mr. Narendra Jadav (Principal, Navnirman Institute of Management) for providing us with an opportunity to gain proper practical knowledge and widening our mind by making us enter real corporate world and know the system.

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Executive Summary

The Indian Insurance Industry is broadly segmented into public and private insurance companies. Before year 2000, only public sector insurance companies were allowed to do business in India. But after year 2000, insurance sector was thrown open for private insurance companies as well. But as of now there now around 19 private life insurance companies and around 9 private non-life insurance companies doing business in India with around 310 Broking Companies. This report is prepared with an aim to provide an overview of present Indian Insurance Industry. Also with Beacon Insurance Brokers Pvt. Ltd., heading the broking of public and private life insurance companies. Based on this report, the prospect will get to know a vivid description about Beacon Insurance Brokers Pvt. Ltd..

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Chapter 1: INTRODUCTION
1.1 OVERVIEW OF THE INDUSTRY.
1.1.1 Insurance In India.

The insurance sector in India has come a full circle from being an open competitive market to nationalization and back to a liberalized market again. Tracing the developments in the Indian insurance sector reveals the 360 degree turn witnessed over a period of almost two centuries. 1.1.2 A Brief history of the Insurance Sector. The business of life insurance in India in its existing form started in India in the year 1818 with the establishment of the Oriental Life Insurance Company in Calcutta. Some of the important milestones in the life insurance in India are; 1912: The Indian Life Assurance- For over 50 years, life insurance in India was defined and driven by only one company- the Life Insurance Corporation of India (LIC). With the Insurance Regulatory and Development Authority (IRDA) Bill 1999 paving the way for entry of private companies into both life and general sectors there was bound to be newfound excitement- and new success stories. Today, just three years since their entry, their cumulative share has crossed 13% (source: IRDA), far exceeding expectations. Clearly insurance is on a growth path. The percentage of premium income to GDP which was just 2.3% in 2000-01 rose to 3.3% in 2002-03; and life insurance has emerged as the dominant contributor to this growth. The industry presented a huge opportunity. Life insurance penetration, for instance, was at an abysmal 22% of the insurable population. However, private players have had to rise to many challenges. They were faced with attitudinal barriers towards the category and the perception that insurance was only a tax saving tool. Insurance per se had lost it basic rationale: protection. It wasnt surprising then that its potential lay frozen and unexploited. The challenge for private insurance players was to change the established category driver and get customers to evaluate life insurance as an investment-cum-protection tool.

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1.1.3. Brief Review of Scenario Insurance Insurance in India started without any Regulation in Nineteenth century. It was story of a typical colonial era. A few British companies dominated the market mostly in large urban centers. Insurance was nationalized mainly on 3 counts First, Indian lives were not insured. Second, even if they were insured, they were treated as substandard lives and extra premium was charged. Third, there were gross irregularities in the functioning of Life insurance was nationalized in the year 1956, and then general insurance was nationalized in the year 1972. In 1999, the private insurance companies were allowed back again into insurance sector with maximum cap of 26 percent foreign holding. 1818 The British introduce to India, with the establishment of the Oriental Life Insurance company in Calcutta. 1850 Non life insurance debuts, with Triton Insurance Company. 1870 Bombay Mutual life Assurance Society is the first Indian-owned life insurer 1907 Indian mercantile Insurance is the first Indian non-life insurer. 1912 The Indian life assurance companies act enacted to regulate the life insurance business. 1938 The insurance act, which forms the basis for most current insurance laws, replaces earlier act. 1956 Life insurance nationalized, government takes over 245 Indian and foreign insurers and provident societies. 1956 Government sets up LIC 1972 Non life insurance nationalized, GIC set up. 1993 Malhotra committee, headed by former RBI governor R.N.Malhotra, set up to draw up a blue print for insurance sector reforms. 1994 Malhotra Committee recommends re-entry of private players, autonomy ot PSU insurers. 1997 Insurance regulator IRDA (Insurance Regulatory and Development Authority) set up. 2000 IRDA starts giving licensed to private insurers 2001 ICICI Prudential Life Insurance came into the market to sell a policy. 2002 Banks were allowed to sell insurance plans, as TPAs enter the scene -6-

1.1.4 The Insurance Regulatory and Development Authority (IRDA): Reforms in the Insurance sector were initiated with the passage of the IRDA Bill in Parliament in December 1999. The IRDA since its incorporation as a statutory body in April 2000 has fastidiously stuck to its schedule of framing regulations and registering the private sector insurance companies. The other decisions taken simultaneously to provide the supporting systems to the insurance sector and in particular the life insurance companies were the launch of the IRDAs online service for issue and renewal of licenses to agents. The approval of institutions for imparting training to agents has also ensured that the insurance companies would have a trained workforce of insurance agents in place to sell their products, which are expected to be introduced by early next year. Since being set up as an independent statutory body the IRDA has put in a framework of globally compatible regulations. In the private sector 12 life insurance and 6 general insurance companies have been registered. With the demographic changes and changing life styles, the demand for insurance cover has also evolved taking into consideration the needs of prospective policyholder for packaged products. There have been innovations in the types of products developed by the insurers, which are relevant to the people of different age groups, and suit their requirements. Continued innovations in product development has resulted in a wide range of flexible products to meet the requirements for cover at different stages of life -today a variety of products are available ranging from traditional to Unit linked providing protection towards child, endowment, capital guarantee, pension and group solutions. A number of new products have been introduced in the life segment with guaranteed additions, which were subsequently withdrawn/toned down; single premium mode has been popularized; unit linked products; and add-on/riders including accidental death; dismemberment, critical illness, fixed term assurance risk cover, group hospital and surgical treatment, hospital cash benefits, etc. Comprehensive packaged products have been popularized with features of endowment, money back, whole life, single premium, regular premium, rebate in premium for higher sum assured, premium mode rebate, etc., together with riders to the base products. -7-

1.1.5 Historical Perspective Prior to 1956 1956 2001 242 companies operating Nationalization- LIC monopoly player -Government control Opened up sector

1.1.6 Contribution to Indian Economy -Life Insurance is the only sector which garners long term savings. -Spread of financial services in rural areas and amongst socially less privileged. -Long term funds for infrastructure. -Strong positive correlation between development of capital markets and insurance/pension structure. -Employment generation.

1.1.7 Insurance Industry prior to de-regulation Prior to deregulation in 2000, market was a public monopoly. Public Monopoly - 2000 Offices - Over 800,000 agents Distribution through tied agents only Sales approach primarily on a tax savings platform Traditional style product offering : Endowment and money back plans Inadequate and inflexible products Pensions: Small part of product offer Limited focus on customer needs

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1.2 Overview Of The Company

BEACON INSURANCE BROKERS PVT. LTD.

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1.2.1: Company Profile-

Beacon Insurance Brokers Pvt. Ltd. Introduces itself as one of the Leading Names amongst Insurance Broking Companies in India. (IRDA Licensed No. DB 307/05)

Incorporation:

January 31, 2005

Main Objective: Act as Direct Insurance Brokers (Life & Nonlife) Paid Up Capital: INR 5 Million Net Worth : Registered Office: INR 20 Million 3rd floor,
ITC BUILDING, MAJURA GATE CHAR RASTA, RING ROAD, SURAT-395002 GUJARAT-INDIA

Our Presence : Corporate Office:

Ahmedabad, Ankleshwar, New Delhi, Mumbai, Surat, Vadodara, Jaipur, Rajkot and expanding in Northern and Southern region. A-201, Taksh complex, nr. ESI hospital crossing, Gotri Road, Vadodra- 390021.

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Beacon Insurance has a team of qualified MBAs, Engineers, Licentiates, Associates & Fellows of the Insurance Institute of India. The Organization is set up to develop core competency in Insurance Sector. We started our operations in the year 2005. Since then Beacon is effectively Managing Insurance Portfolio of numbers of Individuals, Small, Medium and Large Corporates. Professionals with 20-30 years experience in Private and Public Sector blended with young vibrant team have come up together to emerge BEACON as a one of the lastest Growing Insurance Broking Company. We have our Networks all over India and have in house expertise in all aspects of Property, Human, Liability and other insurance domains. We have stron Infrastructure which takes care of all needs of clients for General and Life Insurance. Beacon is committed to bring changes in the mindset of Indian Corporates about effectiveness of implementing insurance as Risk Management Tool.

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1.2.2. From the Desk: Beacon started its journey in 2005 with a modest strength of 7 persons. We have grown to strength of 130+ persons. We take pride in the fact that our team is known in the industry for its professional approach. We live by our principle of Trust, Tolerance & openness & believe in delivering more than we promise. We have invested in systems & technology to bring to you the most modern & complete service delivery module ensuring the best is brought to your doorstep. Continuous training & evaluation of the team ensures razor sharp capabilities to continue giving you the best possible solutions be it simple or complex. I would like to take this opportunity to thank all of our patrons who helped us reach so far by reposing faith in us at all stages. Insurance broking requires high degree of expertise as we work as your outsourced business partners to ensure maximum protection from any unforeseen eventuality. Selection of product & insurance company becomes a key decision in this process. We act as a catalyst by associating with you in this decision making process.On behalf of the company, I assure you that we shall deliver more than your expectations-always. In Beacon our philosophy is Customer satisfaction. Each & every decision of ours is towards achieving our goal of serving the customer to his fullest satisfaction. We have learnt a lot in the process & designed & redesigned our processes to keep on bettering the consumer expectations. Systems & processes so created always have customers interest in mind & we keep on reinventing things to make services more & more customer friendly.

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Feedback mechanism from customers has immensely helped us we are thankful to them for this. Our patrons have always been a source of inspiration for us. We would not like to be remembered as a company doing huge business volumes. Instead, we shall be pleased to be remembered as company giving the best customer service at all facets & in all transactions.We look forward to your complaints & suggestions which shall help us in improving ourselves

Mr. S . K. Rustagi Managing Director

Mr. Sanjay Agarwal Director

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1.2.3. Mission, Vision and Philosophy:

Mission:

"We shall deliver excellent service and superior products to our customers, remaining focused to their needs and strive for continuous improvement through communication and technology. We will unite and operate our business through the shared value of Trust, Tolerance and Openness. Our employees shall be known and respected within the industry for their expertise, commitment and professional integrity."

Vision:

The most successful and admired life insurance company, which mean that we are the most trusted company, the easiest to deal with, offer the best value for money, and set the standards in the industry. In short, The most obvious choice for all For retention in the market and highest market share, we need trust of our customer. The customer should trust on our policies, services, employs and they should be friendly with us. It wants to live in the eye and heart of the customer. It wants to give them the easiest deal so that they cane understood the terms and policies. As we know that profit is the main aim of any business but it think not only about his profit but also profit of the customer. It wants to be the choice of all people on the basis of trust of customer, delivering high value to the customer, and deliver the best value of the money

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Corporate Philosophy: To work towards the utmost satisfaction of the client by always taking care of their best. Work continuosly to improve Knowledge, Skill, Attitude, and Experience, to be most competent in the industry. Always provide the best services as an outsource partner. Flexibility in approach to innovate and continuosly deliver value added services.

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Beacons team is a perfect blend of fresh ideas in accordance with the exhaustive
experience of eminent professionals. And team truly demonstrates the statement.

Mr. S. K. Rustagi M Sc., MBA, FIII Over 25 years of experience in the insurance industry. Has worked with huge corporates such as The New India Assurance Company Ltd, IFFCO Tokio General Insurance Company, etc in various managerial capacities. He is the Managing Director of Beacon Insurance Brokers Pvt. Ltd.

Mr. Sanjay Agrawal B Sc (Hons), DIM, FIII Over 22 years of experience in Insurance Industry. Has worked with big companies such as The New India Assurance Company Ltd,IFFCO Tokio General Insurance Company Ltd,Bajaj Allianz General Insurance Company Ltd. He is the Promoter Director of Beacon Insurance Brokers Pvt. Ltd.

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Mr. Naresh Vig B.Com, AIII Over 31 years of experience in Insurance Industry. Has worked in various capacities with companies such as The Oriental Insurance Company Ltd. & Pioneer Insurance & Reinsurance Brokers Pvt. Ltd. He is the Vice President at Beacon Insurance Brokers Pvt. Ltd.

Mr. Manish Shah M.Com, AIII Over 7 years of experience in the General Insurance Industry. Has previously worked with IFFCO Tokio General Insurance Company Ltd. He is presently designated as the Vice President & Branch Head for Baroda Office.

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Mr. H G Shah B Sc. LIII Over 26 years of experience in The New India Assurance Co. Ltd. He has been associated with Beacon since inception as a consultant & is now designated as Assistant Vice President for Corporate Office at Baroda.

Ms. Rupali Misra B.Sc, MBA (HR/Mktg) Over 4 years of experience in Insurance Marketing. She is currently designated as Assistant Vice President for Ankleshwar Office.

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Mr. Sudhanshu Trivedi BCA, MBA Over 4 years of experience in General Insurance Marketing. He is currently designated as HOD-Strategic Marketing Group at Surat Office.

Ms. Deepika Goyal B.Com, MBA, FIII Over 5 years of experience in General Insurance Operations. She is currently designated as Assistant Vice President and branch head for Surat Office.

Ms. Radhalakshmi Iyer B.Com, LLB, FIII Over 22 years of experience in the General Insurance Industry wherein she has worked with companies such as United India Insurance Company Ltd., & Bajaj Allianz General Insurance Company Ltd. She is presently designated as Senior Manager (Operations) at Ahmedabad Office.

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-:MARKETING AND SALES DEPARTMENT:-

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Chapter 2: Marketing and sales department

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2.1: Basic Understanding of Marketing & Sales:

2.1.1: Meaning of marketing & sales: "The term "sales and marketing" is used so commonly that it is assumed that they are one and the same by many people - they are not. Definition for sales is the activity of taking a lead and selling the item desired. Definition for marketing is the activity of finding out what the market wants to buy"

Marketing: It is a process by which: one identifies the needs and wants of the people. one determines and creates a product/service to meet the needs and wants. [PRODUCT] one determines a way of taking the product/service to the market place. [PLACE] one determines the way of communicating the product to the market place. [PROMOTIONS] one determines the value for the product.[PRICE]. one determines the people, who have needs/ wants then creating a transaction for exchanging the product for a value and thus creating a satisfaction to the buyer's needs/wants [PEOPLE]

Insurance Marketing:

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It is corporate objectives, including profitability, which are no less important than that of industries. Marketing of insurance products has become an important activity in this business. Its marketing is found to be necessary both in life and non-life insurance sector. The main driver of growth in the life segment is the unit linked product and in case of non-life insurance, it has been the motor and health insurance portfolios.

Sales :What is selling? The essence of Selling involves discovering the prospects need, and then offering suitable Products, which will satisfy this need. Selling is a process in which the salesperson makes the prospect think, feel and do, just the way he/she wants Selling is not cheating or conning In fact a salesperson must be honest, friendly and helpful in order to win the confidence of the prospects. Selling is a practical implementation and part of marketing. It often forms a separate grouping in a corporate structure, employing separate specialist operatives known as salespersons (singular: salesperson. Sales is considered by many to be a sort of persuading "art". Sales Process:

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Proposer is convinced about Insurance Plan

Proposer Fills the relevant Proposal Form

Underwriting (Assessment of Risk)

Insurer evaluates the proposal form Policy document sent to policy holder Revised offer sent to proposer Accept Reject/Postpone Counter offer

2.1.2: Differentiate Between Marketing & Sales: Sales and marketing are closely interlinked and are aimed at increasing revenue. As sales and marketing are closely intertwined it becomes hard to realize the difference between the two. In small firms, one cannot come across much difference between sales and marketing. But bigger firms have made clear distinction between marketing and sales and they have specialized people handling them independently. Well, how is that sales and marketing are different? In very simple words, sales can be termed as a process which focuses or targets on individuals or small groups. Marketing on the other hand targets a larger group or the general public. Marketing includes research (identifying needs of the customer), development of products (producing innovative products) and promoting the product (through advertisements) and create awareness about the product among the consumers. As such

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marketing means generating leads or prospects. Once the product is out in the market, it is the task of the sales person to persuade the customer to buy the product. Well, sales means converting the leads or prospects into purchases and orders. While marketing is aimed at longer terms, sales pertain to shorter goals. Marketing involves a longer process of building a name for a brand and pursuing the customer to buy it even if they do not need it. Where as sales only involve a short term process of finding the target consumer. In concept also, sales and marketing have much difference. Sales only focuses on converting consumer demand match the products. But marketing targets on meeting the consumer demands. Marketing can be called as a footboard for sales. It prepares the ground for a sales person to approach a consumer. Marketing as such is not direct and it uses various methods like advertising, brand marketing, public relations, direct mails and viral marketing for creating an awareness of the product. Sales are really interpersonal interactions. Sales involve one-on-one meetings, networking and calls. Another difference that is seen between marketing and sales is that the former involves both micro and macro analysis focussing on strategic intentions. On the other hand, sales pertain to the challenges and relations with the customer.

Summary: 1.Sales target on individuals or small groups. Marketing on the other hand targets a larger group of the general public. 2.Marketing means generating leads or prospects. sales means converting the leads or prospects into purchases and orders. 3.Marketing involves a longer process of building a name for a brand and pursuing the customer to buy it even if they do not need it. Where as sales only involve a short term of finding the target consumer.

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2.1.3 Detailed Organization Structure of Marketing Department:

Beacon has a highly qualified marketing team with around 400 sales agents working for the Surat Branch.

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M.D. & Promoter Mr. S.K. Rastogi

Director & Promoter Mr. Sanjay Agrawal

Marketing Manager Deepika Goyal

Assistant Manager (Life Insurance) Pragnesh Soni

Assistant Manager (General Insurance) Ritesh Nai

Direct Marketing Rana Pradeep Singh

Sales Agents

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2.2 Marketing Environment :

Marketing Relating To Insurance Industry: Needless to say insurance industry is as interested in optimum result as any other industry. it has corporate objective, including profitability, which are no less important than that of other industries. before proceeding to talk at marketing and its modern trends, one has to take note of some of its special characteristics. Any undertaking where there is a risk of financial loss, there is a need for insurance cover. merchants universally have long discussed such problems with businessmen in convenient meeting places such as the now famous coffee house in which Edward Lloyd met ship owners, Seafaring men and merchants who had a common interest in shipping and marine insurance. the main classes of risk covered in those early days were marine and fire thoughts agents. Development of communications and expansion of industrial activity in the 19th and 20th centuries led to the formation of more insurers and eventually to establishment of branch network by successful companies, which absorbed local concerns. Competition development between various forms of intermediaries like agents and brokers and between insurers.

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2.2.1: Concept of target and target customer:

The "Target Market" for a life insurance broking company is the type of client that they want to concentrate on, based on income bracket, neighborhood, type of business, like Beacon Insurance Brokers Pvt. Ltd. Highly focuses on Marine Insurance and Fire Insurance in General Insurance sector while in life insurance sector almost every human being is the target customer of the company which defies very clearly that how much big is the scope for the company to unveil. Some companies want to target the low - middle income families. Some want to target the higher income families. Some want to write mostly blue collar workers, while others want to concentrate on the white collar workers. Some insurance companies just want to sell to business groups. So generally when we see the target customers of Beacon Insurance Brokers Pvt. Ltd. Is mainly the target customers of the insurance companies itself.

Apart From This every company wishes to sell minimum possible number of policies to very aged persons because there is a high risk of insuring them.

Although companies have target markets, they still have the underwriting capabilities to cross over into other markets to write business, but the majority of their business will come from their target market

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2.2.2: Macro environment: PEST Analysis of Insurance Market: There are several forces at work in every sector and every industry of an economy. The dynamic nature of every industry keeps the pulses of the companies operating in each sector racing. PEST refers to all political, economic, social and technological factors affecting insurance industry. Following are the different factors affecting the insurance sector: Political: Malhotra Committee: Till the year 1993, the insurance sector accounted to just 2% of the GDP whereas the world average was 8%. To improve the penetration of insurance as a percentage of GDP, the government set up a committee called as the Malhotra Committee in 1993. In 1993, Malhotra Committee headed by former Finance Secretary and RBI Governor R. N. Malhotra, was formed to evaluate the Indian insurance industry and recommend its future direction. The Malhotra committee was set up with the objective of complementing the reforms initiated in the financial sector.The reforms were

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aimed at creating a more efficient and competitive financial system suitable for the requirements of the economy keeping in mind the structural changes currently underway and recognizing that insurance is an important part of the overall financial system where it was necessary to address the need for similar reform. In 1994, the committee submitted the report and some of the key recommendations included: o Private Companies with a minimum paid up capital of Rs.1bn should be allowed to enter the industry o Foreign companies may be allowed to enter the industry in collaboration with the domestic companies o Only one State Level Life Insurance Company should be allowed to operate in each state The committee emphasized that in order to improve the customer services and increase the coverage of the insurance industry should be opened up to competition. But at the same time, the committee felt the need to exercise caution as any failure on the part of new players could ruin the public confidence in the industry. Hence, it was decided to allow competition in a limited way by stipulating the minimum capital requirement of Rs.100 crores. The committee felt the need to provide greater autonomy to insurance companies in order to improve their performance and enable them to act as independent companies with economic motives. For this purpose, it had proposed setting up an independent regulatory body. The Insurance Regulatory and Development Authority (IRDA): Reforms in the Insurance sector were initiated with the passage of the IRDA Bill in Parliament in December 1999. The IRDA since its incorporation as a statutory body in April 2000 has fastidiously stuck to its schedule of framing regulations and registering the private sector insurance companies. The other decision taken simultaneously to provide the supporting systems to the insurance sector and in particular the life insurance companies was the launch of the IRDAs online service for issue and renewal of licenses to agents. The approval of institutions for imparting training to agents has also ensured that the insurance companies would have a trained workforce of insurance agents in place to sell their products, which are expected to be introduced by early next year. The IRDA since its incorporation as a statutory body has been framing regulations and registering the private sector insurance companies. IRDA being an independent statutory body has put a framework of globally compatible regulations. Privatization of Insurance sector: The introduction of private players in the industry has added to the colours in the dull industry. The initiatives taken by the private players are - 31 -

very competitive and have given immense competition to the on time monopoly of the market LIC. Since the advent of the private players in the market the industry has seen new and innovative steps taken by the players in this sector. The new players have improved the service quality of the insurance. As a result LIC down the years have seen the declining phase in its career. The market share was distributed among the private players. Though LIC still holds the 80% of the insurance sector but the upcoming natures of these private players are enough to give more competition to LIC in the near future. FDI in insurance sector: Then, the issue came of amount of FDI to be allowed by a foreign player in the insurance sector. The government had allowed the private players to have foreign equity up to just 26 %. Efforts are going on to raise this to 49 %. After the opening up of the sector, a total of 18 private sector companies have entered the life insurance business and all of them have entered with a foreign partner.

Economical: Indian economy growth projections: By 2025 the Indian economy is projected to be about 60 per cent the size of the US economy. The transformation into a tri-polar economy will be complete by 2035, with the Indian economy only a little smaller than the US economy but larger than that of Western Europe. By 2035, India is likely to be a larger growth driver than the six largest countries in the EU, though its impact will be a little over half that of the US. India, which is now the fourth largest economy in terms of purchasing power parity, will overtake Japan and become third major economic power within 10 years. All these facts or forecasts only drive at one point. India is booming as a market. The global insurance industry has a big eye on India owing to its big opportunity. India is the next big thing in the global insurance industry. Many new insurance companies are planning to enter Indian markets. South African major Sanlam recently announced a tie up with Chennai based Shriram Group for life insurance business. French multinational Axa, which has been studying the Indian market for long, is expected to finalize its plan this year. Dutch insurer Aegon, on its second visit to the country after a gap of four years, is scouting for a partner and has set up an office. Korean giant Samsung, the newest kid on the block, also has set up a representative office.

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 Growing premiums: Growing premiums are obviously attracting the new players. During the financial 2004 05 alone, the life insurance premium grew by 35% to over US $ 13.5 billion in 2004-05. According to Mumbai based research agency Crystalise Research, over the next five years, Crystalise believes this figure to zoom past the US $ 33.5 billion mark. The numbers at the industry level perhaps tell only one part of the story. The entry of private insurers in India has changed the way in which life insurance business has been done in India. Premiums of each of the dozen private players has gone up significantly within two years of operations, and the incumbent, LIC is being forced to pull up its socks. SBI Life Insurance reported a rise of 166% in its premium income to US $ 138 million for the financial year 2004-05, compared with US $ 53 million it collected in 2003-04. HDFC Standard Lifes premium incomes went up from US $ 67 million to US $ 113 million for fiscal 2004-05. In terms of first year premium revenue, the biggest gainer has been Bajaj Allianz, with a growth of 446.9%. The increasing premium rates are a reason why multinational insurers are flocking to India. Per capita GDP: According to a study by Swiss Re, a leading global reinsurance company, once per capita GDP touches $10,000, life insurance premium collection takes off. Indias per capita GDP is hovering around $ 3000 but is expected to go up steeply given the economic growth projections. Also, India, despite being the second largest in terms of population and insured lives, posts a very low figure in terms of the countrys share of life insurance premium in the worlds total life premium collection about 0.8%. This shows that the insurance sector provides ample untapped market for insurers. Bank assurance: Bank assurance - selling life insurance through bank branches - has also driven life insurance business over the two years. Heres why. First, banks deposits as a percentage of total financial assets of the household sector have gone down from about 46% in 1980 to about 30% now. This means that banks have to seek other avenues, beyond just interest income, to remain profitable. Banks have found that selling life insurance policies is a great way to make profits. LIC distributes over US $ 1.6 billion as commission to its sales force every year. Even if banks succeed in capturing 10% of this amount, they would have revenue opportunities in the range of US $ 162 million, not a small sum for many banks. Result: As many as 32 banks have tied up with LIC to sell its life covers to their customers. LIC may have begun firming up its relations with banks, but by way of bank assurance, it has collected only around US $ 335 million, which is - 33 -

less than 1% of what the corporation collected by way of first premium income last fiscal year. In contrast, private players have excelled in bank assurance. SBI Life, which has vaulted to the second position among private players, owes as much as 67% of its premium income to bank assurance. SBI Life has tied up its promoter and Indias largest commercial bank, State Bank of India, which has more than 10,000 branches spread across the country, for selling its policies. Account holders with the bank are offered life covers for as little as Re 1 per month. For most of the private insurance firms, bank assurance has contributed to about 50% of premium income. Tax benefits: Payment of insurance premium had also been included in the service tax net in the 2004 budget. Although 2004 seemed to be a dampener for individuals insured, the Budget 2005 was a delight. Section 88 benefits have been scrapped. This means that tax rebate under Section 88 will not be applicable to an individual anymore. It has now been replaced by Section 80C. Under Section 80C, one can now invest a sum of up to Rs 100,000 in investment avenues like NSC, PPF, infrastructure bonds and/or life insurance and the same will be deducted from an individuals taxable income. This is a welcome move. For one, there was a limit of Rs 70,000 on life insurance premium to avail of Section 88 benefits. This ceiling has now been raised to Rs 100,000. An individual can now allocate an enhanced amount to insure himself adequately and still get a tax benefit. He can also manage his portfolio better without having to worry about tax benefits. For example, he can increase his insurance coverage by buying a term plan (pure risk cover plan) and allocate a sizable amount from his portfolio towards retirement planning. The changes in this years budget have also come as a welcome move for individuals whose annual earnings exceed Rs 500,000. Until now, these individuals did not benefit from the tax-saving on account of paying a life insurance premium. But this years budget has removed this anomaly and they too can now look at life insurance up to a ceiling of Rs 100,000 premium to avail of tax benefit. Social: Life expectancy & Mortality rate: The life expectancy is defined as the number of years for which a new born baby will live in the prevailing mortality condition of that particular year. The mortality or crude death rate refers to the number deaths per thousand people. Both these factors are very important as they are used to derive the premium of a - 34 -

particular policy. All the insurance companies follow a set standard table referring to which they decide upon the premium rates. This is generally prescribed by the government. Following is the life expectancy and death rate in India: Demographics: One of the major influences on the premiums or prices charged by insurance companies is on the basis of the demographics. Premium rates largely depend on the age, sex of the individual insured. All the insurance policies have a different rate of premiums to be paid. This is mainly due to the difference in the risk involved of different individuals insured. Gender discrimination: Gender based discrimination is rampant in any industry. In the insurance industry the companies have different premium rates for men and women. This cannot be actually called as gender discrimination. As is said earlier the premium depends on the life expectancy in the particular country. More often than not the life expectancy is different for men and women. Usually the women are expected to live more than the men and the difference is 5 years and greater. Hence, what the insurers argue is that the women are a relative less risk than the men and hence the premium charged is more for women. Demographics: One of the major influences on the premiums or prices charged by insurance companies is on the basis of the demographics. Premium rates largely depend on the age, sex of the individual insured. All the insurance policies have a different rate of premiums to be paid. This is mainly due to the difference in the risk involved of different individuals insured. Gender discrimination: Gender based discrimination is rampant in any industry. In the insurance industry the companies have different premium rates for men and women. This cannot be actually called as gender discrimination. As is said earlier the premium depends on the life expectancy in the particular country. More often than not the life expectancy is different for men and women. Usually the women are expected to live more than the men and the difference is 5 years and greater. Hence, what the insurers argue is that the women are a relative less risk than the men and hence the premium charged is more for women. Insurers are providing cover against risk In order to provide them with cover against potential liabilities (that they can pay claims or the right level of benefits), pricing would have to be biased towards the most secure -and often least favorable- variant. This is to allow insurers to fulfill all their - 35 -

commitments. "Gender-neutral" insurance in the true meaning of the word is impossible in voluntary insurance products. Religion Islam: In its modern form, insurance was introduced in Muslim countries when many of them were occupied by Western powers, or when they came under Western influence. In some cases, its introduction was delayed in a country until its international business flourished. Like everything that came with a colonial or Western colour, insurance was first viewed by Muslim scholars with grave suspicion. A verdict of disapproval was common to most things thought to be introduced by non-Muslims. Muslim scholars are divided on the subject of the permissibility of life insurance. Some consider it forbidden on the assumption that it involves a kind of gambling and it goes against the principle oftaqdir in Islam. Most of the insurance organizations today are involved inriba and other islamically prohibited transactions. It is for this reason important that Muslims should have their own insurance companies based on Islamic economic principles. Insurance can be re-organized under Islamic principles so that it is free from all prohibited practices. After Islamic banking, its the turn of Islamic insurance. Even as the Reserve Bank of India is exploring Islamic banking opportunities for Indian banks, the Life Insurance Corporation of India has set the ball rolling ontakaful (Islamic insurance). LICs new international joint venture company - Indo-Saudi Insurance Company will be the first to introduce takaful. This Arabic word means guaranteeing each other or joint guarantee. The entire pricing will be different as the benefits differ from conventional insurance policies. Its actuarial team has started working on the pricing mechanism and senior officials have been sent to Saudi Arabia to look into the product, he added. Takaful can be described as cooperative insurance where policyholders contribute a certain amount of money to a common pool. Each member pays his subscription (premium) to help those that need assistance. Insurance offered by NGOs/ community based health insurance: Community-based schemes are typically targeted at poorer populations living in communities, in which they are involved in defining contribution level and collecting mechanisms, defining the content of the benefit package, and / or allocating the schemes, financial resources. Such schemes are generally run by trust hospitals or nongovernmental organizations (NGOs). The benefits offered are mainly in terms of preventive care, though ambulatory and in-patient care is also covered. Such schemes tend to be financed through patient collection, government grants and donations. - 36 -

With these community based insurers mainly in the rural areas, the rural people have good faith on them. This is one of the main reasons why the rural areas remain untapped by most of the insurance companies. The rural population associate themselves well with these community based insurers which makes life difficult for the big companies waiting to enter the rural areas. Improving standard of living: If, by 2030 AD 50% Indian population reaches the level of middle class, Indian market for Insurance Sector will reach the level of 600 million from conservatively estimated present level of 100 million. Even at the present level of 100 million, Indian market is big enough by global standards for vigorous development as the premium density is only 0.6% as compared to 3 to 5% for developed markets. Prospects for conventional insurance development in Indian market in 21st Century are bright provided its transformation takes place in the right form and right type of strategy is developed to transform hidden potential into business. Consumer attitude and preferences: Insurance was always viewed by people as a safety net. Indians specially are very emotional as far as family members, security, social status and other such issues are concerned. The insurance industry is primarily based on the fact that people live their family their belongings and hence want them to be with them forever. This is the basic attitude of people towards insurance. The Indians, hence, are more vulnerable and tend to pay more attention towards the insurance advertisements and insurance products. Other factors: There are many other social factors that affect the insurance industry. The consumers mindset is such that insurance is viewed as a liability. This happens because, the policyholders have to pay regular premiums in the policy and as long as they live there is no benefit. Thus, this is a classic irony of insurance. One has to die to avail of the benefits. This brings about a negative picture of insurance as a product. TECHNOLOGICAL: Computerization:

Initially in the late 1950's the insurance companies used unit record machines to process data punched into cards. Computers were introduced in the mid 1960's and by the 1980's the Unit Phased Machines were phased out and the entire process was computerized. This brought about greater efficiency and quick service delivery.

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Internet:

Internet usage has drastically improved in the last decade. There was a tremendous increase in the use of technology by LIC during the late 1990's. The company launched its website www.licindia.com in the mid 1990's to offer basic services such as modifying polices and querying the status of policy. But Today, the internet has completely changed the service delivery process. Internet is today used to even selling insurance policies. Internet is infact proving to be one of the widely used distribution networks for selling insurance policies. Also internet is used for sending premium notices to policy holders through e-mails. Also LIC has a special feature on its website. It has a premium calculator which accurately displays the amount of premium month wise and the remaining balance. One just has to enter the age, name of the insurance policy, the sum assured and weather there is an accident cover or not. By keying in this information, the entire premium amount are shown within no time. This has helped the customers in a way so that he/she does not have to travel all the way to branch to ascertain the amount of premium to be paid. Electronic Clearance Service (ECS):

Almost all the big organizations today provide the ECS facility to its customers. A policy holder having an account in any bank which is a member of the local clearing house can opt for ECS debit to pay premiums. The advantage here is that once the option is exercised, the policy holder need not visit a branch for paying the premium or collecting the receipts. On the day indicated by the policy holder, the premium amount will be directly debited to the bank account of the policyholder and the receipt will be issued by the designated branch office. Bank ATMs: Many insurance companies have a tie-up with commercial banks so as to enable policyholders to use the facility of paying premiums through the bank ATMs. ICICI Prudential has a tie up with ICICI bank; LIC has a tie-up with Corporation bank and UTI Bank.

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Call Centres and SMS services: Almost all the insurance companies have their own call centres which cater to the phone based queries of the policyholders. This service is 24x7 and they have the Interactive Voice Response (IVR) systems at all the branches. Also, LIC and other companies now provide SMS services going with the new trends like SMS banking in the banking sector

2.2.3: Details of competitors: Overview of the competitors: The insurance sector is a booming sector in India, the competition in insurance industry is increasing day by day and so is with the insurance broking companies. As only 10% of Indian market is covered so far in terms of Life Insurance there is a rising scope in both Insurance Companies as well as the Insurance Broking Companies. In all there are 410 competitors of Beacon Insurance Brokers Pvt. Ltd. All over India.

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Following is the list of competitors in Surat of Beacon Insurance Brokers Pvt. Ltd.

Rajkrishna Ins. Broker Pvt. Ltd. (Earlier known as Raj Assurances) SNK General Ins. Pvt. Ltd

Rajkrishna House, 4th Floor, Opp: SMC Pumping Station, Near Navjivan Circle, Udhna Magdalla Road, Surat-395 017. SNK House, 31-A, Adarsh Society, Opp. Seventh Day Adventist School, Athwalines, Surat-395001 NJ Centre, `B` Tower, 9th Floor, Udhna Nagar Sangh Commercial Complex,

NJ Insurance Brokers Pvt Ltd

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Central Road No. 10,Udhna , Surat, 394 Loyal Insurance Brokers Pvt Ltd 210. Near Mahavir Cardiac Hospital, Athwa Gate,, 55, Maher Park, A-Wing,, Surat, Havmor Insurance Brokers Pvt Ltd Aviva Life Insurance Company India Pvt Ltd Gujarat 395001 1022, World Trade Centre, Udhana Darwaja, Ring Road, Surat - 395002 4th Floor, Hiral Shopping Complex, Near State Bank Of Indore, Ring Road, Surat - 395002

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2.3: Consumer and industrial buying behavior:

2.3.1: Meaning of consumer and industrial buying behavior Consumer Buying Behaviour: The Purchase Decisions: The purchase decision in general is prompt by number of factors viz. Psycho graphical, Economical, Social, Politico legal and Demographical. The list is not exhaustive but it is sufficient to have the deep understanding of the factors influencing the decision. Psycho graphical Factors are those factors that includes the behavioral aspect of the individual viz. lifestyle, living standard. Here purchase decision in influenced by those issues that affect the lifestyle of the consumer or in the other that reflects the status. For e.g.: purchase decision related to buying of car and that to Mercedes Benz. Talking specifically to the insurance sector, here customer will buy only that policy that has got high premium or that type of policy which company is promoting to limited high-income level group only. For e.g. "Classic Life premier" policy of Birla Sun life insurance is meant for only those individual who can pay at least Rs. 25000/- per annum. Economical factors affect the purchase decision by influencing the issues pertaining to money and income level of the individual. Consumer will buy only that product which will not have any negative effect on his pocket. For e.g. decision to buy an insurance policy is influenced by the deepness in the pocket. Social factor affect the purchase decision by influencing the issues pertaining to social beliefs and morals. Political and legal is the macro level environment. It effects in a way, say IRDA has restricted the sale of Key Man Insurance policy through Term Plan only. Demographical factor is that factor which has got the maximum of its effect in the purchase decision of the product and specially if that product is life insurance product. It is so because these factors incorporate other above said factors and includes those factors that can influence the buying decision to maximum extent viz. Occupational factor (service/business), Age factor, Gender, Marital status factor and Income level etc.

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2.3.2: Factor affecting Consumer buying behavior We analyze consumers because; this is the basis for all market strategies like segmenting, targeting, and positioning. Without an understanding of customer, it would be impossible for the market to drive the offer. A consumers buying behavior is influenced by cultural, social and personal factor. Cultural factor; Culture is fundamental determinant of a persons needs and behavior. People acquire a set of value, perception and behaviors through his or her family and other institution. Indian people want achievement and success, comfortable efficiency and practicality, freedom and youthfulness. In other word there are multicultural environment in India. Indian loves their family and they want to secure their family from unnatural event. Indian give first preference to his family after than others. They do not want to take loan and they want to invest their money in long-term investment for child education and marriage. When we say about metropolitan city, dependency on old age on son is decreasing. People want to accumulate some fund for old age so Beacon concentrates on gratuity or pension plan. Indian people also affected from sub culture. Urban people want to take more insurance comparison than rural (due to high per capita income, insurance awareness, social security, investment purpose, tax saving purpose). Religion also effect on insurance. Consumer behavior is also affected from reference group. Firstly, people see that which insurance is bestseller after that they purchase. They also influence from agent. People do not concentrate on their need due to agents influence. Social class also affect on consumer behavior. Lower class does not want insurance. Upper lower class wants insurance for saving purpose. Working and middle class want insurance for protection and saving purpose and lastly, upper class want to purchase insurance for investment tax benefit and saving purpose.

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Social factor: Consumers are also influenced by social factor for example; reference group, family, and social role and status. Consumer behavior is firstly influenced from membership group such as family, neighbor and co- worker. Insurance is such type of product where people awareness is very low so people do not very much about insurance. They think, insurance is only tax saving instrument so they fully dependent on agent for taking insurance. When agent say about any product, that time they inquiry from neighbor and co-worker about that product. If any body suggests that, this product and I have also taken this product. Individual think that, this product also best for him. He does not concentrate on his need and requirement. Secondly, he is influenced by information influences. If he goes to purchase insurance, he makes enquiry about this product from his personal sources. He study newspaper and search on Internet and gather all information related product. If he is satisfied from that information, he decides to buy insurance. People also influence from opinion leader, this opinion leader may be Mukhiya, or Surpanch in rural area or this may be any leader, actor or cricket player in urban area. If opinion leader say or advertise about any product, people are influenced from opinion leader because opinion leader keep good position in society. Family and household pattern also influence consumer behavior. Due to less security of individual family, people want to purchase insurance, but in joint family people give less attention in buying insurance. If all family are well earning, there are given less attention on insurance in such family. But if earning member is less and dependent is more in such type of family insurance is very important. Women want more security so women are taking main role in purchase decision where, women influence consumer behavior.

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Personal factor: A consumer decision is also influenced by personal characteristics for example the buyer age and stage in life cycle, occupation and economics circumstances, personality, selfconcept, life style and value. When we say about age and life, first is bachelor stage. They are generally young independent and they are in early stage of his carrier and earning. They mostly think that they have no need of insurance because in that time they have no dependent. However, some people have some dream and dependent also. They are in such stage where they can take more risk so they mostly prefer to invest in ULIP. Second stage is newly married. In that stage people need and buying decision is influenced from their future plan and earning capability. If they have to plan for purchase flat that time, they will need term insurance. There after stage is one or two children after marriage, they will be influenced from future need. They will accumulate fund for children marriage and education, they can be plan time-to-time vacation. In forth stage, they want to accumulate for retirement. People want to live alone after old age or in peaceful place so they are ready to start saving for old age. Attitude also affect consumer behavior positive attitude (about his life) person will take pension plan because people think that they will live more. But negative attitude person will take life insurance because they worry about their life.

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2.3.3: Process of buying behavior:

Stages of Adoption Process: An innovation refers to any good, service, or idea. That is perceived by someone as new. The idea may have long history, but it is an innovation to the person who sees it as new. Innovation takes time to spread through the special system. The consumer adoption process focuses on the mental process through which an individual passes from first hearing about an innovation to final adoption. Adopters of new products have moved through the following five stages. 1.AWARENESS: The consumer becomes aware of the innovation but lacks information about it. 2.INTEREST: The consumer is stimulated to see the information about the innovation. 3.EVALUATION: The Consumer considers whether to try the innovation or not. 4.TRIAL: The consumer tries the innovation to improve his estimate of its value. 5.ADOPTION: The consumer decides to make full and regular use of the Innovation.

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2.4 Product:
2.4.1: Meaning of product/Service: A service is the intangible equivalent of an economic good. Service provision is often an economic activity where the buyer does not generally, except by exclusive contract, obtain exclusive ownership of the thing purchased. The benefits of such a service, if priced, are held to be self-evident in the buyers willingness to pay for it. Public services are those society pays for as a whole through taxes and other means. 2.4.2: Types & Classification of Products & Services Offered By Organization: List of Life Insurance Companies: a) Bajaj Allianz Life Insurance Company Limited b) Birla Sun Life Insurance Co. Ltd c) HDFC Standard Life Insurance Co. Ltd d) ICICI Prudential Life Insurance Co. Ltd e) ING Vysya Life Insurance Company Ltd. f) Life Insurance Corporation of India g) Max New York Life Insurance Co. Ltd h) Met Life India Insurance Company Ltd. i) Kotak Mahindra Old Mutual Life Insurance Limited j) SBI Life Insurance Co. Ltd k) Tata AIG Life Insurance Company Limited l) Reliance Life Insurance Company Limited. m) Aviva Life Insurance Company India Limited n) Sahara India Life Insurance Co, Ltd. o) Shriram Life Insurance Co, Ltd. p) Bharti AXA Life Insurance Company Ltd. q) Future Generali India Life Insurance Company Limited r) IDBI Federal Life Insurance Company s) Canara HSBC Oriental Bank of Commerce Life Insurance Company Ltd. - 47 -

t) AEGON Religare Life Insurance Company Limited. u) DLF Pramerica Life Insurance Co. Ltd. v) Star Union Dai-ichi Life Insurance Co Ltd. List of Non Life Insurance Companies:
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24.

Bajaj Allianz General Insurance Co. Ltd. ICICI Lombard General Insurance Co. Ltd. IFFCO Tokio General Insurance Co. Ltd. National Insurance Co.Ltd. The New India Assurance Co. Ltd. The Oriental Insurance Co. Ltd. Reliance General Insurance Co. Ltd. Royal Sundaram Alliance Insurance Co. Ltd Tata AIG General Insurance Co. Ltd. United India Insurance Co. Ltd. Cholamandalam MS General Insurance Co. Ltd. HDFC ERGO General Insurance Co. Ltd. Export Credit Guarantee Corporation of India Ltd. Agriculture Insurance Co. of India Ltd. Star Health and Allied Insurance Company Limited Apollo Munich Health Insurance Company Limited Future Generali India Insurance Company Limited Universal Sompo General Insurance Co. Ltd. Shriram General Insurance Company Limited. Bharti AXA General Insurance Company Limited Raheja QBE General Insurance Company Limited, SBI General Insurance Company Limited Max Bupa Health Insurance Company Ltd. L&T General Insurance Company Limited

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NOTE: As we can see Beacon deals with a huge number of products which is nearly impossible to study for a project hence we have classified all its products into different categories of Insurance Industry.

Popular traditional products:

Term Insurance Plan: - This is the cheapest Life Insurance Policy. In this policy the Insurance is covered for a fixed amount for Fixed Term. If unfortunately the Life Assured passes away during the Policy Term than the full Sum Assured is paid to the Nominee. If everything goes well and the Life assured is alive on Maturity than nothing is payable on Maturity. It is just like a General Insurance Policy the only difference is that it is along term contract & not a Yearly Contract.

Whole Life Insurance Plan:- In this policy the risk cover continues for the whole life but the premium is either to be paid in Single Mode, Limited Payment or Whole Life. The Sum Assured is payable only on Death either with or Without Bonus as per the Policy Condition.

Endowment Insurance Plan :- In this plan the Policy is for a Fixed Term & in case of unfortunate Death the Sum Assured with or Without Bonus as per the policy Condition paid to the Nominee & if everything goes well than on Maturity the Sum Assured is paid to the Life Assured with or Without Bonus as per the policy Conditions.

Money Back Insurance Plan :- This is also one type of Endowment plan but in this plan

very 3rd. 4th or 5th year a part of Sum Assured is paid to the Life Assured as Survival Benefit & in case of unfortunate death during the policy term the Full Sum Assured without deduction of Survival Benefits will be paid to the Nominee With or Without Bonus as per the Policy Condition & in case everything goes well the Sum Assured after deducting the Survival Benefits will be paid to the Life Assured With or Without Bonus as per the Policy Condition

Beacon promise is financial security. A strong brand certainly boosts sale, but without customer-friendly, innovative products, even the best brand would not last long. - 49 -

Beacons product range has been developed on the understanding that different people have their own sets of needs at various stages of their lives. It has thus built a flexible portfolio of products that can be customized to cater to varying needs of people at each stage, and thus ensure protection in every step of life. The companys philosophy has been to help customers understand their financial needs and work closely with them to customize a product that would meet. Advisors can offer a complete range of products Savings plans, Child plans, Market-linked plans, Protection plans, and Retirement plans and tailor a flexible solution to meet customers changing needs at every stage of life. -Add on services provided by the insurance companies: Flexible Rider Options Insurance companies offers flexible riders, which can be added to the basic policy at a marginal cost, depending on the specific needs of the customer. Accident & disability benefit: If death occurs as the result of an accident during the term of the policy, the beneficiary receives an additional amount equal to the rider sum assured under the policy. If an accident results in total and permanent disability, 10% of rider sum assured will be paid each year, from the end of the 1st year after the disability date for the remainder of the base policy term or 10 years, whichever is lesser. Critical illness benefit: Critical Illness Benefit Rider provides protection against critical illnesses to the policyholder when attached to the basic plan. After Sale Services: Doorsteps claim settlement. Cheque pick up facility. Call Reminders on policy lapsing and other facilities. Site Visit Query Solving. Survey within the 24 hours of the loss

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 Preparation of documents of claims. Regular follw up with surveyor. Scrutinizing the assessment of the loss. 2.4.3: Brand & Brand equity: Beacon Insurance Brokers Pvt. Ltd. . The name itself is a brand in itself which provides unmatched services unlike any other insurance broking company. Beacon Insurance Broker Pvt Ltd is known as a hub for insurance policies where one can avail its superior experienced services. Life or General there are no bars in Beacon, it provides all kinds of insurance policies of almost all the major players of insurance industries under one roof. Hence one can say it is a combination of goodwill of all the major players of insurance industry of India. Not just India now Beacon has international partner as well. Beacon has tied up with UNIBA risk solution partners which has one of the largest independent broker network internationally. The key Features that make Beacon a Brand which is unlike any other broking company are- Team of Professionals - Blend of Experience and Youth. - Wide network of offices worldwide. - Impact of any adverse condition is countered effectively and speedily. - Beacons logo of light house indicates that it is a light in ones life that guides them away from contingencies of future. - Complete Range of Insurance Products/Services/ Risk Management. - Beacons Branding is so strong that it does not require any advertisement for its promotion, the customer references does the trick for its boosting sales figure. - Beacon is a NSIC-CRISIL rated Company (SE 2B) PERFORMANCE CAPABILITY HIGHEST FINANCIAL STRENGTH HIGH SE 1A MODERATE SE 1B LOW SE 1C

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HIGH MODERATE

SE 2A SE 3A

SE 2B SE 3B

SE 2C SE 3C

2.5: PRICE:
2.5.1: Meaning of price: Pricing : Underwriting results of many classes of general insurance make dismal reading. The history of motor and marine cargo rates over the years release a steady erosion of premium income by rate cutting and bad underwriting in the face of competition, particularly marine cargo. And, Motor had a tariff to boot. Fire, the cash cow all along with the tariff ruling high, is heading for bad days with the abolition of tariff control. One factor in the deterioration of the fire account has been the interplay of various competative elements. Whereas one might consider the growth of broker control business as such as element, it must be remember that it is the underwriter who is finally responsible for setting the rate of premium. Not unnaturally broker have competed for large accounts and have striven to preserve and enlarge the business by getting the best possible terms for their clients, but the real competition has been between underwriters. Much comments is made on the present day lack of business ethics. But who can blame the underwriter who is presented with a proposition of fixing too find a rate for securing a business that was too hotly contested. The effect of competition from life insurer is probably more marked in the sphere of term insurance and in particular, group life insurance, where rates of premium would almost appear to have reached levels which are too find even for present day mortality. Yet, as long as company are judged on total sum insured rather than premium income , group life and term insurance will be attractive as "Window Dressing". 2.5.2: Pricing Policies Adopted By The Organization: Beacon Insurance Brokers Pvt. Ltd. Is a very sound and sensible company. Its pricing policy is also as simple as its simplicity. As Beacon deals with all kind of insurance policies of several companies its pricing policy is almost same with all the companies. Every policy sold under Beacon will be entitled of 15% commission (Average) from the

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insurance company. Other charges applicable to the customers are based upon the policy sold. Price of every policy differs from company to company. In case of General Insurance Beacon may provide additional discounts from its own pocket. Hence we can see that how simple its pricing policy is.

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2.6 PLACE:
Definition: The place is where you can expect to find your customer and consequently, where the sale is realized. Knowing this place, you have to look for a distribution channel in order to reach your customer. 2.6.1: Meaning: This term really refers to any way that the customer can obtain a product. Provision of a product can occur via any number of distribution channels, such as in a retail store, through the mail, via downloadable files, on a cruise ship, in a hair salon, etc. The ease and options through which you can make your product available to your customers will have an effect on your sales volume. 2.6.2: Channel of Distribution used by Organization: There are basically two types of distribution channel Direct Channel and Indirect Channel. Beacon Insurance Brokers Pvt. Ltd follows both types of Distribution channels. Under Beacon a customer can opt for having an insurance policy directly from beacon or they may buy it from beacon through an agent. Hence beacon follows both two level channel and three level channel

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Direct Distribution channel

Two-LEVEL Distribution channel

COMPANY BEACON INSURANCE BROKERS PVT LTD

COMPANY (BEACON INSURANCE BROKERS PVT LTD)

INSURANCE AGENTS

CUSTOMERS

CUSTOMERS

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2.6.3: Functions Performed By Channel Of Distribution: Risk taking Assuming the risk connected with carrying out channel work or being a part of a channel Negotiations Reaching an agreement on pricing and other terms which may be a part of the transaction Matching Placing order with the manufacturers and matching the orders to the actual requirement. Contacts Maintaining contacts with existing customers as well establishing contacts with potential customers and maintaining the same with the regulatory bodies Promotions Carrying out effective communications to stimulate purchasing Information Gathering information about potential customers, competition as well as tracking the environmental factors. Providing Physical proof of policy to the customers Market Research Reporting

Maintaining customer relations Providing after sale services

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2.7: PROMOTION:
Definition of Promotion: An activity designed to boost the sales of a product or service. It may include an advertising campaign, increased PR activity, a free-sample campaign, offering free gifts or trading stamps, arranging demonstrations or exhibitions, setting up competitions with attractive prizes, temporary price reductions, door-to-door calling, telemarketing, personal letters on other methods. 2.7.1: Meaning of Promotion: More than any other element of the promotional mix, sales promotion is about action. It is about stimulating customers to buy a product. It is not designed to be informative a role which advertising is much better suited to. Sales promotion is commonly referred to as Below the Line promotion. Sales promotion can be directed as: The ultimate consumer (a pull strategy encouraging purchase) The distribution channel (a push strategy encouraging the channels to stock the product). This is usually known as selling into the trade Under PULL STRATEGY Beacon tries to attract the customers through its unmatched services like updating the customers through phone calls and letters, through door to door visits, by providing the services of all the insurance companies under one roof, negotiating with companies for special offers to offer to the customers and on top of all the after sales services of company acts like a cherry on the cake. Under PUSH STRATEGY the company tries to update the agents by organizing a small party under which the are informed about the new products and the companys expected target is set before them with attractive offers for the agents through which they are tempted to work for the company from their soul and whatever that comes from within will always be in favour of the companys growth.

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2.7.2: Elements of Promotion Mix: Beacon Insurance Brokers Pvt. Ltd has limited yet effective promotion mix. Mainly the reason behind this limited promotion mix is that the companys brand image is the best part of it which does the trick to boost their sales. Beacon provides a high level of customer satisfaction so the the customers themselves becomes the promoters of the company when they give reference of the company to their relatives. Following are the promotion mix performed by the company: -Sales Promotion: There are around 400 sales agent working for beacon insurance brokers pvt. Ltd. Promoting the sales by providing information to the customers about our products to the customers. They find out the customer requirements and cater with the best option available for them. Apart from sales the provide information to the company as well that what is the customer demand in the market through which company may negotiate with the insurance companies also. -Personal Selling: Beacon Insurance Brokers pvt ltd believes that there should be no third party between them and their customers which creates a sound communication between them and they can cater them with a personal touch. Beacon provides personal selling wherein they sell the insurance policy to the customers without any agents and enabling a haste free environment. -Direct Marketing: Beacon also holds Direct Marketing handled by Rana Pradeep Singh. Direct marketing is a form of advertising that reaches its audience directly through multiple channels including email, direct mail, social media, catalogs, online advertising, interactive television, etc. Businesses communicate straight to the consumer with advertising techniques such as fliers, catalog distribution, promotional letters, and street advertising. Direct Advertising is a sub-discipline and type of marketing. There are two main definitional characteristics which distinguish it from other types of marketing. The first is that it sends its message directly to consumers, without the use of intervening commercial communication media. The second characteristic is the core principle of successful Advertising driving a specific "call to action." -Publicity: As such in Beacon there is no publicity done externally but of course as said earlier customers of beacon are the core part of their publicity the customer brings customers for Beacon and this is how it goes.

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2.7.3: Communication Process:-

We need to do 3 things to achieve this 1. Greet the Customer 2. Briefly state purpose 3. Ask for time

Features

Always state most relevant Features of the product first

Advantages

Explain the advantages of the features

Benefits

Emphasize the Benefits that the prospect would derive

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S A T M C

Smile Acknowledge Turn the Objection Show More Value Close

Probe thoroughly, until you Identify the Need

Be relaxed. Business-like, and yet unhurried

Carry Conviction

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2.8 Strength and Weakness:

Promoters with Rich Industry Experience

Provision of Web Enabled Services OUR STRENGTHS

Experienced And Responsive Team

Good Organizational Infrastructure

Network of Offices Across India

Weakness:
Unavailability of Equity, Mutual funds, Fixed Deposits and other investment options.

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2.9 Marketing Control:

2.9.1: Meaning and Importance of Marketing Control: There is no planning without control. Definition of Marketing control : Marketing control is the process of monitoring the proposed plans as they proceed and adjusting where necessary. If an objective states where you want to be and the plan sets out a road map to your destination, then control tells you if you are on the right route or if you have arrived at your destination.

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1.

Type of Control Annual Plan Control

Prime Responsibility Purpose of Control To examine whether Top Management the planned results are being achieved. Middle Management

Approches Sales analysis Market Share analysis

Sales-to-expense ratios

Financial analysis Market-based scorecard analysis

1.

Profitability Ratio

Marketing Controller To examine where Profitability by: the company is making and losing money. Territory Customer Segment Trade Channel Order Size Product

1.

Efficiency Control

Line and Staff management

To evaluate and improve the and impact of marketing expenditure.

Efficiency of: Sales force Advertising Sales Promotion Distribution Marketingeffectiveness rating instrument Marketing Audit Marketing experience review

Marketing Controller spending efficiency

1.

Strategic Control

Top Management Marketing Auditor

To examine whether the company is pursuing its best opportunities with respect to markets, products and channels

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HUMAN RESOURCE MANAGEMENT DEPARTMENT

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-: OPERATIONS DEPARTMENT :-

OPERATIONS DEPARTMENT

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-: FINANCE DEPARTMENT :-

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CHAPTER 6: RECOMMENDATIONS & SUGGESTIONS

Through the course of summer internship, students need to undergo training under all the four departments of Beacon Insurance Brokers Pvt. Ltd. i.e. Marketing, Human Resource Management, Operations Department and Finance Department. We as a part of interns in Beacon Insurance Brokers Pvt. Ltd. Would recommend this organization as a better place for internship because the staff here provided us training under a very friendly atmosphere where we felt like learning from home. Under the course of training we came across few points that company may follow. As a suggestion I would like to suggest company to have a little bigger space for training under their newly established office where trainees could fit in properly. They may provide us with the financial reports as we promise them of not disclosing it and to maintain it as a part of our studies, this will make trainees learn more about the organization. On the part of departments, we would recommend company to develop more reports under all the four departments for better control.

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Bibliography
Insurance World Magazine Images from Google.com http://www.beacon.co.in/ http://www.scribd.com/doc/26345828/Marketing-Control

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Annexure

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Thanks Giving:
Finally its is a pleasure conveying our thanks to all the people who supported us in successful completion of our Internship. Firstly we would like to convey our thanks to Mr. Pragnesh Soni for providing us an opportunity to have internship under Beacon Insurance Brokers Pvt. Ltd. and to make us understand their business and insurance industry of India. We like to show are hearty regards to Mr. Sailesh Mishra for training us and shaping us through the course of two months and providing his esteemed time to us. We are thankful to Mr. Narendra Jadav (Principal NIM) for giving us such a wonderful task and opportunity of Summer Training through which we came across the real corporate world and a chance to enhance our skills. Hearty thanks to Mr. Mehul Ganjawala for his constant guiding through out our training period and providing us accuracy in building our project report.

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