Study the customer satisfaction of Life

insurance product FOR IDBI Federal LIC

DONE FOR

Project report submitted in partial fulfilment of the requirement of

PONDICHERRY UNIVERSITY for the award of the degree of
MASTER OF BUSINESS ADMINISTRATION

Submitted By
MOHD SHAFAQ
(Reg. No. 17397056)

Under the Guidance of

Dr. B. CHARUMATHI
Professor,
DEPARTMENT OF MANAGEMENT STUDIES
SCHOOL OF MANAGEMENT
PONDICHERRY UNIVERSITY
PONDICHERRY-605014

May – June 2018

DEPARTMENT OF MANAGEMENT STUDIES

SCHOOL OF MANAGEMENT
PONDICHERRY UNIVERSITY
PONDICHERRY-605014

CERTIFICATE

This is to certify that this project report entitled “Study the customer satisfaction of Life
insurance product FOR IDBI Federal LIC
” done for IDBI Federal LIC is submitted by MOHD SHAFAQ, 2nd year MBA to
the DEPARTMENT OF MANAGEMENT STUDIES, SCHOOL OF MANAGEMENT,
PONDICHERRY UNIVERSITY in partial fulfilment of the requirements for the award of the
degree of MASTER OF BUSINESS ADMINISTRATION and is certified to be an original
and bonafide work done under the guidance of Dr. B. Charumathi, Associate Professor,
Department of Management Studies. This report has not formed the basis for the award of
any degree, diploma, associate ship, fellowship or other similar title to the candidate and that
the report represents an independent and original work on the part of the candidate.

Dr.B.Rajeswari
Professor & Guide
Department of Management Studies

Dr. Chitra Sivasubramanian

Professor and Head
Department of Management Studies

Date:
Pondicherry 605 014

DECLARATION

I hereby declare that this project report entitled “Study the customer satisfaction of
Life insurance product FOR IDBI Federal LIC” in IDBI Federal LIC submitted in the partial
fulfilment of the degree requirement for the award of the degree MASTER OF BUSINESS
ADMINISTRATION (MBA) Of DEPARTMENT OF MANAGEMENT STUDIES,
SCHOOL OF MANAGEMENT, PONDICHERRY UNIVERSITY, PUDUCHERRY-605014
is based on secondary data found by me in various departments, websites, databases, annual
reports & collected by me and done under the guidance of Dr. B. CHARUMATHI,
Professor, Department of Management Studies, Pondicherry University.

Date: MOHD SHAFAQ

Reg. No.17397056
MBA (2ND YEAR)
Department of Management Studies
Pondicherry University
TABLE OF CONTENTS

CHAPTER DESCRIPTION PAGE NO

CERTIFICATE FROM ORGANISATION
CERTIFICATE FROM DEPARTMENT
DECLARATION
EXECUTIVE SUMMARY
ACKNOWLEDGEMENTS
LIST OF TABLES
LIST OF FIGURES (IF ANY)
ACRONYMS USED (IF ANY)
1 INTRODUCTION
1.1 INTRODUCTION TO THE TOPIC
1.2 REVIEW OF LITERATURE
1.3 NEED FOR THE STUDY
1.4 STATEMENT OF THE PROBLEM
1.5 OBJECTIVES OF THE STUDY
1.6 RESEARCH METHODOLOGY (type of research, nature of
data, sources of data, variables used (if any), methodology (if any),
sample size, sampling methodology, statistical or financial tools
1.7. PERIOD OF THE STUDY (if any)
used, software packages used
1.8 LIMITATIONS OF THE STUDY
1.9 CHAPTERIZATION
PROFILE OF INDUSTRY AND COMPANY (PRODUCTS
2
IF ANY)
2.1 PROFILE OF INDUSTRY
2.2 PROFILE OF COMPANY
3 CONCEPTUAL FRAMEWORK (Fill your topic)
4 ANALYSIS AND INTERPRETATION
SUMMARY OF FINDINGS, SUGGESTIONS AND
5
CONCLUSION
5.1 GENERAL FINDINGS
5.2 SPECIFIC FINDINGS
5.3 SUGGESTIONS
5.4 CONCLUSION
BIBLIOGRAPHY
EXECUTIVE SUMMARY

The insurance industry of India consists of 57 insurance companies of which 24

are in life insurance business and 33 are non-life insurers. Among the life insurers,
Life Insurance Corporation (LIC) is the sole public sector company. Apart from
that, among the non-life insurers there are six public sector insurers. In addition to
these, there is sole national re-insurer, namely, General Insurance Corporation of
India (GIC Re). Other stakeholders in Indian Insurance market include agents
(individual and corporate), brokers, surveyors and third party administrators
servicing health insurance claims.

The domestic life insurance industry registered 10.99 per cent y-o-y growth for new
business premium in 2017-18, generating a revenue of Rs 1.94 trillion (US$ 30.1 billion).

Insurance sector companies in India raised around Rs 434.3 billion (US$ 6.7 billion)
through public issues in 2017.

In 2017, insurance sector in India saw 10 merger and acquisition (M&A) deals worth US$
903 million.

India's leading bourse Bombay Stock Exchange (BSE) will set up a joint venture with
Ebix Inc to build a robust insurance distribution network in the country through a new
distribution exchange platform.

The future looks promising for the life insurance industry with several changes in
regulatory framework which will lead to further change in the way the industry conducts
its business and engages with its customers.
The overall insurance industry is expected to reach US$ 280 billion by 2020.
Demographic factors such as growing middle class, young insurable population and
growing awareness of the need for protection and retirement planning will support the
growth of Indian life insurance.
ACKNOWLEDGEMENT

It’s a great privilege that I have done project in such a well-organized & diversified
organization. I am very grateful to all those who helped and supported me in completing
the project.
First of all I would like to thank MISS. SNEHA JAIN, team lead, IDBI Federal life
insurance company for giving me an opportunity to do project work as summer trainee in
IDBI Federal life insurance company & also I would like to thank to all the staff members
for their cooperation & help given by them. Their experiences & feedback kept me on
track and helped me produce much better results.
I sincerely thank Dr. B. Charumathi, Associate Professor, Department of Management
Studies, for her guidance and support in shaping my project, correcting errors, clearing
doubts throughout the project.
I thank Dr. Chitra Sivasubramanian, Head of the Department of Management Studies
for giving me an opportunity to do this project.
Finally I would like to thank my parents, almighty and my friends who have
supported me in successful completion of this project.

MOHD SHAFAQ

Chapter 1

Introduction
 INTRODUCTION

Man is exposed to risk and uncertainties. For instance, the time of death of a person is not
certain and in case of his premature death a man’s dependents may find themselves deprived
of all means of existence. Similarly, the property of a person is open to all risks of its being
destroyed by fire. Every prudent man will carefully consider how best he can prevent such
risks or minimise or provide against its effects. It is difficult for an individual or even a large
business enterprise to invest millions of rupees in the huge factory building and equipment or
ships unless the arrangement for covering the risk is possible. This arrangement is made
possible by insurance. Life insurance is not only designed to protect the future interest of
one’s family, but also to provide reasonable returns on one/s investment. Consequently,
many people use life insurance as a form of investment as saving for their child education,
preparation for retirement or adding to the value of their savings pool in general and they
may also use it as a backup in case of a financial emergency The life Insurance is a contract
between two parties where one party agrees to indemnity the loss suffered by the other party
for consideration of some money called premium. The party, which promises to indemnity
the loss, is called “Insurance” and the person or the party subjected to the risk is called
“Insurer”. “Insurance” is a contract in which a sum of money is paid by the insured in
consideration of the Insurer’s incurring the risk of paying a large sum up on a given
contingency.

Insurance may be defined as a system of collective security under which any member who
suffers is paid compensation for a loss, from a fund jointly contributed by the members.

INTRODUCTION TO THE TOPIC

In today’s world of intense competition, the key to sustainable competitive advantage lies
in delivering high quality service that will in turn result in satisfied customers . The need
for striving for customer satisfaction lies in its ability to result in economic success.
Customer satisfaction is considered a prerequisite for customer retention and loyalty, and
obviously helps in realizing economic goals like profitability, market share, r eturn on
investment, etc. Although there is a general conformity on the distinctiveness of service
quality and customer satisfaction from a conceptual point of view, the operationalization
of customer satisfaction is somewhat hazy.

In order to measure customer satisfaction the operating elements of service quality have
been used. The respondents have been asked to give their responses regarding their level
of satisfaction on a five‐point scale (ranging from 1 (indicating very high dissatisfaction)
to 5 (indicating very high satisfaction)) for all the items. Data have been collected from
the customers (40 customers) who responded to the survey on service quality.
REVIEW OF LITERATURE

This chapter presents the review of literature to identify and understand the implications of
different issues related to consumer behaviour and life insurances in India. A comprehensive
review of related past studies helps to adopt, modify and improve the conceptualisation of
framework and provide a link with past approaches. The findings and recommendation of the
past literature relating to consumer satisfaction towards life insurance services are not many.
Only few comprehensive studies exclusively towards consumer satisfaction on is carried out
in India. Based on the review of literature the Research has enable to identify the source for
the present study. The available studies are collected from research articles, committee
reports, projects and surveys conducted.

The Planning Wing of the LIC Divisional Office, Thanjavur (1987)4 has conducted a sample
survey on “Customer Satisfaction”. The objectives of the study found the level of consumer
satisfaction regarding the services, particularly on the aspects such as timely dispatch of
discharge forms, reminders, the cooperation given by agents or development officers,
courtesy and sympathy of Company officials, receipt of the policy amount within the due
date etc.

The Insurance Institute of India prepared a Project Report on “Marketing of Life Insurance”,
(1987)5. This project was undertaken to examine the following aspects: Extent of life
insurance coverage, awareness, attitudes and beliefs of people on life insurance, perceptions,
sense of identification of employees with Life Insurance Company. LIC products are sold
easily among the consumers on account of its reliability.

Krirubashni, B. (1991)6 in her study attempts to know the level of awareness, preference and
influencing factor pertaining to policy holdings and to test the relationship between the
influencing factors and policy holdings. The study reveals that the majority of the
respondents aware of the endowment assurance policy and considered to rank it as number
one. The study also revealed that there was a significant relationship between personal factors
and policy holdings.

The past related reviews are basically relating to marketing strategies, its current impacts,
customers awareness towards new polices, insurance penetration, insurance perception,
buying behaviour towards Life Insurance Company, opportunities and challenges in Life
Insurance Company, case study, operations of Life Insurance Company, comparison with
other countries, channels of distribution, potential growth in insurance, reforms adopted by
Life Insurance Company, consumer preference in insurance industry, attitude of
policyholders to its life insurance company services and its contribution towards the
development of an economy. There is no specific and in depth study relating to the Customer
satisfaction of Life Insurance Company. This enabled to carry out the intensive research in
the field of Consumer behaviour and satisfaction in IDBI FEDERAL LIFE INSURANCE
COMPANY in DELHI CP region.

NEED FOR THE STUDY

The insurance industry is a notoriously difficult one in which to profit, with enormous
amounts of data put through incredibly complicated risk analysis formulae required to set
premiums, and the possibility of huge numbers of unforeseen claim expenses coming through
at once. Additionally, competition legislation which makes it easy for customers to switch
insurers means that customer satisfaction is more critical than ever to profits.

The most obvious method of satisfying customers in the insurance industry, paying a high
percentage of claims, is unfortunately a method that eats directly into profits. So looking at
the facts and figures, and think laterally about what customer satisfaction means in the
insurance industry.

the things that keep insurance customers happy are changing, because we know the
customers themselves are evolving! Compared to the baby boomers, e-surveys have found
that the new generations of insurance shoppers are:

 Not responsive to traditional advertising methods

 Incredibly savvy about using the internet to gather and compare information about
companies
 More sensitive to customer experience than to price
 More likely to be referred to a company by word of mouth
 More likely to switch insurers several times over their lifespan
Therefore, satisfaction for the upcoming generation of insurance purchasers is linked more to
their own experiences of the company, to other customers’ experiences of the company, more
to your online presence and reputation, and less to the price of your product. Contrary to
popular belief, it seems that insurance customers are certainly willing to pay more for better
service!
OBJECTIVES OF THE STUDY

 To Study the services provided by IDBI to their customers.

 To Study the Challenges faced by IDBI federal in current market.
 To study the marketing activities of Life Insurance product in IDBI.
RESEARCH METHODOLOGY

The data collected from customers of IDBI FEDERAL LIFE INSURANCE COMPANY in Delhi
Region of India, this has been used for analyzing the link between service quality and
customer satisfaction. The sampling procedure used for the study was stratified random
sampling. The stratification has been done based on the customers visiting company office.
From them, about 40 customers were randomly selected. Data were collected using the
“personal‐contact” approach, i.e. the respondents were approached personally and explained
in detail about the survey (including its purpose, the meaning of the items and what is
expected of the respondents). Questionnaires were distributed to the customers and they
were asked to give their perception of the level of service quality delivered by IDBI federal
life insurance company on a five‐point Likert scale((ranging from 1 (indicating very poor) to 5
(indicating very good)).The customers were also asked to indicate their level of satisfaction
with the IDBI federal life insurance company on a five‐point Likert scale (ranging from 1
(indicating very high dissatisfaction) to 5 (indicating very high satisfaction)) with respect to all
the items. The respondents were asked to contact the researchers whenever they
encountered any difficulty in responding to the questionnaire. A total of 62 customers have
been approached, from whom 40 correctly completed questionnaires have been obtained,
thereby yielding a response rate of about 65 percent. The high response rate is due to the
personal‐contact approach used followed by periodic follow‐ups over telephone and
personal visits. The Software Used was IBM SPSS & Excel, And the Tools Used is
Independent Variable T-Test, Anova,
PERIOD OF THE STUDY
LIMITATIONS OF THE STUDY

Like any other research, this study also has some limitations. One ofthe limitations was even
though the researcher wanted to take customers view through structured questionnaire, due
to lot of regulations and privacy policies of companies, such information could not be
collected at a mass level. Secondly, a huge amount of time was invested while collecting data
from all respondents which incurred lot financial implications. Thirdly, the questionnaire was
exhaustive which required roughly 15-20 minutes to respond and that lead many
questionnaire left unfilled or incomplete. Hence rejection was on higher side and to achieve
the reasonable number of respondents, researcher has decided to collect large number of data
from customers. Difficult to access all customers of the company for timing reasons.
PROFILE OF INDUSTRY AND COMPANY

PROFILE OF INDUSTRY

4.0. INTRODUCTION

The economic reforms initiated in the early 90s paved the way for the growth and opening up
of the financial sector, which led to a sustained period of economic growth. The insurance
industry was opened up for private players in 2000, and has seen tremendous growth over the
past decade with the entry of global insurance majors. India is fast emerging as one of the
world’s most dynamic insurance markets with significant untapped potential. The insurance
sector plays a critical role in a country’s economic development. It acts as a mobilize of
savings, a financial intermediary, a promoter of investment activities, a stabilizer of financial
markets and a risk manager. The life insurance sector plays an important role in providing
risk cover, investment and tax planning for individuals; the non-life insurance industry
provides a risk cover for assets. Health insurance and pension systems are fundamental to
protecting individuals against the hazards of life, and India, as the second-most populous
nation in the world, offers significant potential for that type of cover. Furthermore, fire and
liability insurance are essential for corporations to safeguard infrastructure projects and
investment risks. Private insurance systems complement social security systems and add
value by matching risk with price. India is prone to natural catastrophes of one or other kind,
the insurance cover to mitigate the negative financial consequences of these adverse events is
still underdeveloped, leading to significant untapped potential in various segments of the
market. The same is true for both pension and health insurance, where insurers can play a
critical role in bridging demand and supply gaps. The major changes in both national
economic policies and insurance regulations will highlight the prospects of these segments
going forward. Appropriate risk pricing is one of the most powerful tools for setting the right
incentives for the allocation of resources, a feature which is the key to a fast-developing
country such as India. Life insurance sector is the biggest in the world with about 360 million
policies which are expected to increase between 12-15% over the next five years. The
country’s insurance market is expected to quadruple in size over the next 10 years from its
current size of $60 billion. During this period, the life insurance market is slated to cross US$
160 billion. The Indian insurance market is a huge business opportunity waiting to be
harnessed. India currently accounts for less than 1.5 per cent of the world’s total insurance
premiums and about 2 per cent of the world’s life insurance premiums despite being the
second most populous nation. The country is the fifteenth largest insurance market in the
world in terms of premium volume, and has the potential to grow exponentially in the coming
years.

DEFINITIONS

"The act or system of insuring against death; a contract by which the insurer undertakes, in
consideration of the payment of a premium (usually at stated periods), to pay a stipulated sum in
the event of the death of the insured or of a third person in whose life the insured has an interest."
Tindall Justice

"Insurance paid to named beneficiaries when the insured person dies; 'in England they call life
insurance life assurance” Poter Hary
HISTORY OF INSURANCE INDUSTRY

Ever since the beginning of human habitation on this earth, especially in the Neolithic Age of human
Civilization man has been exposed to innumerable harms and hazards which urged upon him to
searchfor ways and means to cope with them. A study ofthe evolution ofthe human race reveals that
man has continuously sought for security and happinessfor himselfand hisfamilyfrom times
immemorial Early Insurance Risk protection has been a primary goal of humans and institutions
throughout history. Protecting against risk is what insurance is all about. Over 5000 years ago, in
China, insurance was seen as a preventative measure against piracy on the sea. Piracy, in fact, was
so prevalent, that as a way of spreading the risk, a number ofships would carry a portion of another
ship's cargo so that ifone ship was captured, the entire shipment would not be lost. In another part
ofthe world, nearly 4,500 years ago, in the ancient land of Babylonia, traders used to bear risk of the
caravan trade by giving loans that had to be later repaid with interest when the goods arrived safely.
In 2100BC, the Code of Hammurabi granted legal status to the practice. It formalized concepts of
“bottom” referring to vessel bottoms and “respondent” referring to cargo..
Modern Insurance

The concept of insurance as we know today took shape in 1688 at a place called Lloyd’s Coffee
House in London where risk bearers used to meet to transact business. This coffee house became so
popular that Lloyd’s became the one of the first modem insurance companies by the end of the
eighteenth century. The primary purpose of the work of Morah was on the process and purposes of
industrial assurance and its influence on the community during the early days of political upheavals
in England [6]. Dickson (1960) expounded the history and experiences of Sun Insurance Office in
London and evaluated the insurance habit of the British.
Insurance industry in India

Globally, share of life insurance business in total premium is ~55%. In

India, that figure is 79%. This shows 2 things a) relative success of life
insurance products and b) poor performance of other insurance relative
to life.

Life insurance penetration is ~2.7%, which means that for every

100$ of GDP India generates, 2.7$ is collected via life
insurance premium. This figure is lower than world average that
is around 3.5%. As per SwissRe, India ranks 10′th in the world
in terms of absolute premium.
Insurance density, which is a real measure of maturity of
insurance sector, is defined as total insurance premium by the
population. This number for life insurance is 43$ - that means,
on average, every Indian is paying roughly 2500 rupees
annually for protecting the life.
Company wise Market Share
There are a total of 24 life insurance companies in India, 23 private and one
public sector company underwriting a total of 3,66,943 crores in 2015-16. Of this,

LIC is the only public sector company contributing 72% of total premium whereas
all the remaining 23 private companies contribute 28% of premium. Domination of
LIC is slowly waning and every passing year, a great proportion of new business
is captured by private players. Lot of LIC's domination comes from its vast pool of
renewal premium which isn't going to drop anytime soon.
Leaving LIC, the top 5 players in the life insurance space are ICICI Prudential,
HDFC Standard, SBI Life, Max Life and Bajaj Allianz. ICICI Pru being the largest
private player commands ~5% market share and between them, top 5 companies
cover 18% of market share.

Distribution channels
Life insurance products in India are distributed by individual agents, corporate
agents, banks (bancassurance), brokers and direct selling by insurance
companies themselves. Largest number of policies sold and also the highest
amount of premium sold is via the individual agent channel. As of 2016, a total of
20 lac individual agents are registered in India.
Last few years, bancassurance channel has been expanding aggressively

interms of market share and individual agent channel has been shrinking. It is
expected that the individual agent model will degrade exponentially in future as
new online/direct channels take its place. Amount of labor is too high and
efficiency of labor is too low to justify this channel for the overall industry; this
channel is ripe for a technological disruption.

Average premium per policy for an individual agent is Rs 18,000 whereas for a
corporate agent, this number is Rs 48,000.

ICICI Prudential, Max New York and SBI Life policies sold by individual agents
have the highest premium per policy. Tata AIA and ICICI Prudential policies sold
by corporate agents have the highest premium per policy. Compared to this, LIC
offers very competitive prices to both individual and corporate agents.

Overall business growth

Overall life insurance business in last 3 years has grown at 8% CAGR with bulk
of that growth coming from private players. Private players have grown at more
than double the rate (~14%) compared to LIC (~6%). Part of this is also because
private players are starting from a much lower base.

Geographic distribution
Top 6 states account for 55% of all premium in the country. Maharashtra tops the
list both in terms of number of policies issued as also the premium. Other top
states in terms of premium are West Bengal, Uttar Pradesh, Gujarat, Tamil Nadu
and Karnataka.
Claim history and settlement ratios
An average of 8.5 lacs of claims are settled in a year with a claim settlement of
~12,600 crores. Last 3 years have seen a growth rate of 7.8% in claims.
Considering that the overall business has grown by 8%, operational ratio for life
insurance business is fairly stable.

Commission paid by insurance companies

Commission paid as a percentage of insurance premium is reducing over the
years. This is partly because distribution is increasingly moving away from
agents. Other reason for this is also the increasing popularity of simple term
insurance that offers lesser commission rates.

LIC traditionally has offered better commission rates than its private counterparts.
Following table shows the commission rates over last 3 years
Retention of Customers

Persistency is the ratio of customers who renew their policies without allowing
them to lapse. Persistency ratio directly tells us the retention rate of customers.
High persistency ratio is extremely important for an industry that offers long term
benefits to customers.

Low persistency ratio is an unfortunate reality of Indian life insurance industry.

Overall average persistency after first year is 60% which drops to a paltry 29%
after fifth year. Out of every 100 customers, only 60 survive by the end of first
year and only 30 survive by the time the policy is 5 years old.

This is very different for global life insurance companies. Overall, OECD
countries reported a 90% persistency after first year and a 65% persistency after
5 years.

Indian life insurance persistency is almost 40% that of global average.

Low persistency ratio is a biggest systemic

challenge for Indian life insurance companies.
Assets under Management
Overall, insurance companies are managing assets worth ~25 lac crores as of
March 2016. Assets are split among the life fund, Pension & annuity fund and
lastly, unit ULIP fund.
More than 2/3'rd assets are held in Life fund that essentially comprises of
government, money market and equity securities.

Solvency ratio of insurance companies

Solvency ratio for insurance companies is the ratio of Net liabilities to equity
capital. Greater the solvency ratio, better is the chance of insurance company to
survive large losses. LIC has the lowest solvency because the govt. of India is
the final underwriter incase a worst case scenario pans out.
Incase of private insurers, Bajaj Allianz has the best solvency ratio among larger
companies.

Profitability of insurance companies

As of 2016, total Equity capital base of Insurance companies was 26,691 crores
and a net profit of 7414 crores giving a healthy Return on Equity of 27%.

Bajaj, ICICI Prudential and HDFC have a solid income generating portfolio and
good operational efficiency and underwriting infrastructure that churns out strong
bottomline numbers. LIC on the other hand has a poor business efficiency and
hence has a much lower profit levels when compared to total business premium.

Overall, life insurance business has good competition and good solvency levels.
Company profile

IDBI Federal Life Insurance

DBI Federal Life Insurance Co Ltd. is a three way joint-venture of IDBI Bank,
an Indian development and commercial bank; Federal Bank, one of India’s
leading[peacock term] private sector banks and Ageas, a multinational insurance giant
based out of Europe.

IDBI Federal distributes its products through a multi-channel network consisting

of Insurance agents, Bancassurance partners (IDBI Bank, Federal Bank) Direct
channel, and Insurance Brokers.

History
In the year 2006, IDBI Bank, Federal Bank and Belgian-Dutch insurance major
Fortis Insurance International NV signed a MoU to start a life insurance company
in India. The company received its license from Insurance Regulatory and
Development Authority of India (IRDAI) (j.Arul jegadeesh one of the trainee in the
idbi federal life insurance company in Madurai) in December 2007.[3]

IDBI Fortis Life Insurance Co. Ltd. officially began its operations in March 2008.
In August 2008, the company collected the premium of over Rs.100 crore within a
record time of five months, thus becoming the fastest growing new life insurance
company in the private sector.[4]

India-Sri Lanka ODI series that took place in October 2009, found a title sponsor
in insurance major IDBI Fortis. The company’s AUM crossed the Rs. 1,000 crore
mark for the first time in March 2010.[5]

In August 2010, the company was rechristened as IDBI Federal Life Insurance
Company. In 2012-13, it declared its maiden profits in record 5 years, thus was
one of the fastest to do so in the industry. It yet again clocked Rs. 80 crore profits
for the financial year 2013-14 and has maintained its profitable trajectory from
thereon.[6]
Ten years ago we entered the industry with the firm mindset that we would become
the best. We started from scratch, with a team of 12 members.

Today, we are among the top 10 trusted life insurance brands in the country,
passionately driven by a team of more than 1,600 members

Company General Information Date of Incorporation January 22, 2007 Corporate

Identity Number U66010MH2007PLC167164 IRDAI Registration No. 135 Website
address www.idbifederal.com Contact Number 022-23029200 Address for
Correspondence IDBI Federal Life Insurance Co Ltd, 22nd Floor, Board room, “A”
Wing, Marathon Futurex, N.M. Joshi Marg, Lower Parel- East, Mumbai 400 013. India

IDBI FEDERAL LIFE INSURANCE IS A JOINT-VENTURE of IDBI BANK ,FEDERAL BANK

and AGEAS.

IDBI BANK: India’s premier development and commercial bank.

Serving retail and corporate customers with an extensive suite of

innovative products and services.

Pan-India presence comprising 1,878 branches.

FEDERAL BANK: India’s major private sector bank with a dominant presence in Kerala.

Serving retail customers with a robust portfolio of financial

solutions.

Nationwide footprint of over 1,250 branches and over 1,600 ATMs.

AGEAS: An international insurance Group with a heritage spanning 190 years.

Offers retail and business customers insurance products designed to suit

their specific needs.

As one of Europe’s larger insurance companies, Ageas is the No.1 insurer in

Belgium and ranks among the market leaders in most of the countries in which it
operates.
Business Highlights

Our Purpose: Empowering you to create the life and lifestyle of your choice.

Our Values: Passion Integrity Execution Ambition Transparency.

Our Guiding Principles: Think Different Display Ownership Be Solution Focused Be

Agile Embrace Openness.

Our Mission: Reaching out to customers, through empowered & engaged employees
and distributors facilitated by cutting-edge technology, right selling & seamless
service to meet their ever evolving needs.

 Individual new business premium grew 15%

 23% Renewal premium growth
 32 new HR initiatives launched
 Successfully maintained 13th rank in new business (individual life)
 Operating cost to gross premium stood at 15%
 81% Persistency for 13th month - amongst the best in the industry
 Net profit grew by 94%
 Recorded the 6th consecutive year of profit
 Total premium went up by 14%
  Net profit grew by 94% to ` 101 crore. Recorded the sixth consecutive year of
profits.
 88% of employees are proud to be part of this organization
 87% of employees relate their work with organisational goals
 82% of employees feel the organisation inspires them to do the best work every
day
 The Company’s Corporate Social Responsibility (CSR) interventions
particularly focus on the development of the vulnerable and marginalised
sections of society. Special emphasis is given to children’s education,
promotion of sports and health. From time to time, our employees visit
institutions within the community and spread cheer along with closely
examining and supporting the needs of the community members.

Awards & accolades

Emerging Asia Insurance Awards & Conclave 2018 Bagged the award of ‘A special
recognition for growth in Life insurance’

Economic Times’ Brand Equity Survey 2018 IDBI Federal Life Insurance is among the
top 10 trusted life insurance brands in the country for the 2nd consecutive year

Finnoviti Awards 2018 Received the prestigious award in the category ‘System
Integration through Robots’

Bombay Chamber of Commerce and Industry Received Civic Award 2017 under ‘Social
Development’ category

MILESTONES

MARCH 2008 SOLD THE FIRST INSURANCE POLICY

AUGUST 2008 ACHIEVED THE FASTEST 100 CR. SALES MARK

APRIL 2014 INTRODUCED NEW EMPLOYEE FOCUSED POLICIES

JULY 2014 IMPLEMENTED 8 DAYS CLAIMS GUARANTEE

MARCH 2015 REACHED THE 1,000 CR. SALES MARK

APRIL 2016 SIGNED SACHIN TENDULKAR AS THE FACE OF THE MARATHONS

MAY 2016 AUM REACHED 5K CR. MARK

OCTOBER 2016 MOVED HEADQUARTERS TO A NEW BUSINESS LOCATION IN

MUMBAI

DECEMBER 2016 TIED-UP WITH PULLELA GOPICHAND’S BADMINTON ACADEMY

MARCH 2018 RECORDED THE 6TH CONSECUTIVE YEAR

OF PROFIT

Board of Directors

Mr. Filip Coremans

Mr. Shyam Srinivasan

Mr. gopalkrishna Annaji Tadas

Mr. philippe Latour

Mr. Ashutosh Khajuria

Mr. Mahadev Narendra Rao

Mr. Jayaraman Balasubramanian

Mrs. Bhagyam Ramani

Mr. Vighnesh Shahane

 Total Risk

Financial Risks Insurance Liability Risk Operational Risks Strategic Risks

Counterparty Life Risk Internal fraud Solvency
Default Risk Mortality External fraud Conduct of Business
Risk mitigating Longevity Information Security Tax
Contracts Disability/Morbidity Malicious Damage Accounting
Receivables and Lapse/Persistency Employee practices Competitor Risk
Loans Expense & workplace safety Distribution Risk
Other Assets Revision Business Continuity
Concentration Disaster & Public
safety
Technology failures
FINANCIAL AND OPERATING RATIOS IDBI FEDERAL LIFE INSURANCE COMPANY LIMITED [IRDAI
Registration No.135 dated December 19, 2007]

Accounting Ratios
s.no. Particulars March 2018 March 2017
1 New business premium income growth (segmentwise)
(New business premium for current year less new
business premium of previous year divided by new
business premium for previous year)
2 Participating –Life (20.83%) -3.54%
3 Non Participating –Life (21.32%) 131.96%

4 Non Participating -Health NA NA

5 Non Participating -Pension NA NA

6 Non Participating -Group 9.19% 72.88%

7 Non Participating -Group Variable (Fund Based) (98.84%) 0.05%

8 Non Participating -Group Variable Pension (Fund (93.27%) 79.00%

Based)

9 NA NA
Linked Group (Fund Based)

10 Linked Life 53.39% 33.05%

11 Linked Pension (8.99%) NA

12 Net retention ratio (Net premium divided by gross 99.38% 99.28%

premium)

13 Ratio of expenses of management (Expenses of 20.19% 22.44%

management divided by the total gross direct
premium)

14 Commission Ratio (Gross Commission paid to Gross P) 5.60% 6.41%

15 Ratio of policyholders liabilities (*) to shareholders 878.85% 818.32%
funds

16 Growth Rate of shareholders funds 14.61% 8.31%

17 Ratio of surplus to policyholders liability (The company NL NL

does not have any surplus and therefore this ratio
cannot be calculated)

18 Change in net worth 9,92,083 5,21,129

19 Profit after tax / Total income 4.25% 2.40%

20 (Total Real Estate + Loans) / Cash & invested assets NA NA

Acting on behalf of the Board of Directors

Filip A.L. Coremans G.A. Tadas Ashutosh Khajuria Chairman Director Director DIN: 03178684 DIN:
00161730 DIN: 05154975

Vighnesh Shahane Kedar patki shivank chandra CEO & Whole Time Director Chief Financial Officer
Appointed Actuary DIN: 06800850

Place: Mumbai dilip c. chakraborty Rajesh Ajgaonkar Date: April 24, 2018 Mentor - Appointed
Actuary Company Secretary
CONCEPTUAL FRAMEWORK
ANALYSIS

Analysis of variance (ANOVA) is a collection of statistical models and their associated

estimation procedures (such as the "variation" among and between groups) used to analyze
the differences among group means in a sample. ANOVA was developed by statistician and
evolutionary biologist Ronald Fisher. In the ANOVA setting, the observed variance in a
particular variable is partitioned into components attributable to different sources of variation.
In its simplest form, ANOVA provides a statistical test of whether the population means of
several groups are equal, and therefore generalizes the t-test to more than two groups.
ANOVA is useful for comparing (testing) three or more group means for statistical
significance. It is conceptually similar to multiple two-sample t-tests, but is more
conservative, resulting in fewer type I errors, and is therefore suited to a wide range of
practical problems.

The normal-model based ANOVA analysis assumes the independence, normality and
homogeneity of the variances of the residuals. The randomization-based analysis assumes
only the homogeneity of the variances of the residuals (as a consequence of unit-treatment
additivity) and uses the randomization procedure of the experiment. Both these analyses
require homoscedasticity, as an assumption for the normal-model analysis and as a
consequence of randomization and additivity for the randomization-based analysis.

However, studies of processes that change variances rather than means (called dispersion
effects) have been successfully conducted using ANOVA.[36] There are no necessary
assumptions for ANOVA in its full generality, but the F-test used for ANOVA hypothesis
testing has assumptions and practical limitations which are of continuing interest.

Problems which do not satisfy the assumptions of ANOVA can often be transformed to
satisfy the assumptions. The property of unit-treatment additivity is not invariant under a
"change of scale", so statisticians often use transformations to achieve unit-treatment
additivity. If the response variable is expected to follow a parametric family of probability
distributions, then the statistician may specify (in the protocol for the experiment or
observational study) that the responses be transformed to stabilize the variance.[37] Also, a
statistician may specify that logarithmic transforms be applied to the responses, which are
believed to follow a multiplicative model.[28][38] According to Cauchy's functional equation
theorem, the logarithm is the only continuous transformation that transforms real
multiplication to addition.
Independent T-test for gender & Marketing activities

H0:There is no significant difference b/w marketing activities & gender of respondents.

H1:There is significant difference b/w marketing activities & gender of respondents.

Sales

female
28%

male
72%