CHAPTER IV. Diploma holder whereas 18% are only matriculates. policies. The remaining 14% have only one policy.

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1 CHAPTER IV 4.1. SUMMARY OF FINDINGS 1) Out of 30 staff, who formed part of the sample. 22 are insured under BIMAKIRAN plan and 19 out of 30 field force are insured under Bima Kiran. Of course, Jeevan Shree being a high premium policy doesn't figure in this category. 17 out of 40 policy holders are insured under Jeevan Shree plan only 2 policy holders have taken the policies. 2) About 69% of the people said they will recommend these products to others. 3) Out of the 100 respondents 56% are graduates 17% are post graduates, 9% are Diploma holder whereas 18% are only matriculates. 4) To the question of no, of policies held by the respondents, it is found that 20% of them have more than 3 policies. 29% of them have 3 policies, 37% have 2 policies. The remaining 14% have only one policy. 5) Regarding the mode of payment premium 33% prefer yearly, premium 20% prefer Half Yearly, 29% salaries deduction whereas the remaining 18% prefer Quarterly mode of premium. It is interesting to note that none of them prefer monthly mode of premium. 6) To the question of opening up of insurance sector to private participation 33% favour it while 67% oppose it. 7) Out of the 100 respondents 57 are having Bima Kiran policy whereas 17 are under Jeevan Shree cover. 2 people are insured under both plans. 55

2 FINDINGS RELATING TO BIMA KIRAN 8) 58% of the people observe that B.K.is well suited for low Income group of people. 38% of other respondents feel that B.K. is ideal for Average income group people. Only 4% of the population feels that it is a policy for high income group people. 9) 66% of the respondents think that Bima Kiran can be suggested as a first insurance whereas the remaining 34% are of the option that it can serve it s purpose well if it is offered as subsequent insurance. 10) Only 32% of the people think that max age at entry is not rightly fixed as 35. whereas the remaining 68% are of the view that it is rightly fixed. 11) 56% of respondents think that max age at may be raised to 40 years. 27% of the population feel that 45 years may be fixed as max age at entry while 17%are of the view that it can be fixed as 55years. 12) To a question regarding the maximum sum Assured 90% of the respondents feel that it can be increased while 10% of them are against this. 13) 57% of the respondents are of the view that max SA allowed under BIMA KIRAN can be increased to 5 lac. 22% are of the opinion that it can be increased to 4 lac. 14% of them feel that it can be fixed at 6 lac whereas the remaining 7% are of the opinion that in can be fixed at 7 lac. 14) To an important question of claim concession provision to operate under this policy. 70% of them reacted in favour of it. While the rest 30% were against it since it is a low premium an high risk plan. 56

3 15) From this survey it is found that 53% of the Bima Kiran policy holders are unaware of the fact that max. S.A.allowed under this plan is 3 lac. Whereas 43% of the population do not know that Accident benefit is coming free of cost. 16) Most worrying revelation is that about 78% of Bima Kiran policy holders do not know that they are eligible for free insurance cover even after maturity. 17) It is found that the above policy conditions were briefed to the policy holders only through agents. It is interesting to find that even though the percentage of policy holders knowing the above 3 policy benefits are low it is only through agents they have come to know about it. It sows that only very few agents are aware of this policy conditions itself. 18)83% of the respondents feel that Bimakiran policy along is not sufficient to cover the risk under the life as many of the respondents want savings aspect also to combine with insurance. As many as 78% of the people want insurance cover linked with savings aspect also. FINDINGS FELATION TO JEE VAN SHREE 1. To a question relating to target group for the above said policy. 58% of the respondents are view that it is best suited for high income group whereas 32% feel that business people this policy % of the population feel that many people are deprived of the benefits provided under Jeevan Shree policy because of the policy condition that the minimum Sum Assured allowed under this plan is 5 lac. 57

4 3. As many a 73% of respondents who have favored the reduction in Sum Assured feel that minimum Sum Assured may fixed at 3 Lac. While the majority of other people feel that it may be fixed at 4 Lac. 4. A whopping 87% of the respondents were ready to pay extra availing Accident benefit exclusively under this policy. 5. Around 52% of the people have expressed satisfaction regarding the yield under this policy 35% of the people are of the view that yield is somewhat low when compared to other plans in LIC. 6. Guaranteed addition of Rs.75/-, Key-man insurance and non availability of Accident benefit are some of the features of this plan. As many as 60% of the respondents know about the available guaranteed Additions. But 70% of responds are unaware of the Key-man insurance facility facility. Similarly 85% of the respondents doesn't know about the fact that this policy can be transferred to another person. Since the last 2 benefits are applicable to big companies who are sponsoring a person for insurance, it is not surprising that many people are unaware of this. But what is worrying really is that many staff & Agents are also unaware of this. 7. Another interesting revelation is that those who have expressed that they are aware of Key-man insurance facilities & Transferability factor have said that cam to know about this only through pamphlets. Agents have not played any role in conveying the same to policy holders. 8. About 40% policyholders of this plan expect yield around 11%. 9-11% is the rate of return expected from this plan by around 45% of the policy holders.

5 9. Continuing with the yield only 35% of the people have felt it satisfactory. 48% have viewed yield as low. It has also been observed that 8% of respondents feel that the yield under this plan is high when compared to other plans in LIC. 10. When asked about whether the policy holders are prepared to pay estra premium for getting periodical installments form this policy like in the case of money back policy 70% have responded favorably. BIMAKIRAN 1. A series of advertising campaigns targeting low & Average income group people have to be launched immediately. 2. More catchy advertisements have to be prepared. 3. Maximum age at entry can slightly be increased to 40 years as per survey findings. Many people feel that need for insurance cover will more felt only after the age of 35. So max age at entry allowed under this plan can slightly be increased. 4. Maximum sum assured allowed under this plant may also be raised to 5 Lac. 5. Claim concession clause may be allowed to operate under this plan. It is unfair to deny insurance protection to a person who as discontinued premium payment after paying for a long term. Claim concession clause may be allowed to operate after imposing condition like payment of premium should have been made atleast for 10 years. 6. Benefits like free insurance cover after maturity and free accident benefit cover should be highlighted in the policy bond. 7. Agents are to be motivated to sell this product even though commission earned by selling this product is less since it is low premium policy. 59

6 8. This plan can be best suited for those who are going for subsequent insurance. So efforts can be made to identify the eligible form the data base available at each branch can mail pamphlets directly to them. 9. A meeting can be held by LIC among the eligible groups like college students, social service organizations like traffic wardens, home guards that this Bimakiran policy can be offered to the group as a whole. Spreading the concept of insurance to the mass is one of two objectives of nationalization and this is in e such a way to achieve this. JEE VAN SHREE 1. Minimum sum assured allowed under this plan may be reduced to 3 lac. 2. Accident benefit may be allowed exclusively to this plan. 3. More effective advertisements can be made through TV & Newspapers. 4. Periodical can be hand delivered with a special and exclusive cover through special messenger as it is costly policy. 5. Policies can be hand delivered with a special and exclusive cover through special messenger as it is costly policy. 6. Free gifts like diaries & Calendars may be given to Jeevan Shree policy holders every years to tell them that they are specially cared. 7. Agents should be trained to canvas this policy under "key man insurance" aspect. So that they can prepare a "businees-talk" with properties of company. More thrust should be given to sell this policy on this project. 8. Benefits like transferability i.e. the policy can be transferred from are life to another has to be highlighted both in the pamphlets and in the policy bond. 9. LIC can directly send pamphlets or it can depute a term to leading organizations and institution for canvassing the plan under key man insurance. 60

7 10. If one company proposes more then 2 persons under this Jeeven Shree plan, special concession in premium rate can be offered SUGGESTIOS RECOMMENDTIONS I. Policy conditions printed on the back of the policy bond should be simple in language and also in vernacular language. 2. The special benefits provided under each policy should be highlighted. 3. Policy bonds should be more attractive. 4. Policy bonds can be prepared in regional languages also. 5. When the policy is dispatched a pamphlet about the policy should be kept inside the cover. 6. Advertisement appearing in TV and Newspapers should wear a new look. Advertisements coming out now are boring and not catchy. 7. More advertisements should be prepared to educate the people about the concept & need of insurance cover. So far advertisement are prepared about the plans offered LIC only. 8. Facilities like payment of premium at any branch within a city and interactive voice response system. (Enquiry through telephone) has to be extended to many more places. 9. Agents should be educated about need based selling, as the two products which are under study, BIMA KIRAN, JEEVAN SHREE can be of much use when it is offered to right person, training and educating an agent is must. 10. Proposal forms can be redesigned in such a way that the policy holders can select the feature they want to be included in the policy. For example features like low premium Accident Benefit cover, savings aspect, periodical returns etc., can be given in the proposal term the policy holder can select the benefits 61

8 he wants to avail and based on the benefits he intends to avail a suitable policy can be offered to him. 11. In each branch an advisory cell may be formed so that policy holders can contact them to know which plan is mote suitable for them. 12. LIC can sponsor events like sports (like LIC cup for cricket, football) and entertainment or some local functions. This will help them in taking the concept of insurance to masses sending a message that LIC forms part of the society. 62

9 4.3. CONCLUSION The project work, "A study on Product Life Cycle of Life Insurance policies BIMAKIRAN and JEEVAN SHREE. A questionnaire was designed and circulated among the policy holders, agents and staff of LIC to study the reasons for the decline in sales of these two products. The views expressed by the respondents were analyzed and some remedial measures are suggested in this study. I hope that the products which are launched to cater the needs of both low income group and high income group, after much research and study, will again capture the market it has lost if the above said suggestions are taken care of 63