PRN 13020841127

AMIT KUMAR

SBI LIFE INSURANCE

INTRODUCTION:
SBI Life Insurance is a joint venture life insurance company
between State Bank of India (SBI), the largest state-owned banking
and financial services company in India, and BNP Paribas Assurance.
SBI owns 74% of the total capital and BNP Paribas Assurance the
remaining 26% of the capital. SBI Life Insurance has an authorized
capital of 20 billion (US$310 million) and a paid up capital of 10
billion (US$160 million).
In 2007, CRISIL Ltd, a subsidiary of global rating agency Standard &
Poor's, gave the company AAA/Stable/P1+ rating. When
the government of India opened the life insurance sector to private
companies, SBI started SBI Life as a joint venture with BNP Paribas
in 2001. While in its initial stage its business was mainly
from bancassurance channel, now it is developing its own agency
team for selling its life insurance products.

MULTI DISTRIBUTION MODEL

SBI Life has a unique multi-distribution model encompassing vibrant
Bancassurance, Retail Agency, Institutional Alliance and Corporate
Solutions distribution channels.
SBI Life extensively leverages the State Bank Group relationship as a
platform for cross-selling insurance products along with its numerous
banking product packages such as housing loans and personal loans.
SBIs access to over 100 million accounts across the country provides
a vibrant base for insurance penetration across every region and
economic strata in the country, thus ensuring true financial inclusion.
Agency Channel, comprising of the most productive force of over
80,000 Insurance Advisors, offers door to door insurance solutions to
customers.

COMPETETORS
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LIC
SAHARA LIFE INSURANCE
HDFC STANDARD LIFE
BIRLA SUN
TATA AIG
AVIVA
RELIANCE LIFE INSURANCE
MAX NEW YORK LIFE INSURANCE
KOTAK MAHINDRA

COMPETETORS
AVIVA LIFE INSURANCE:
Aviva Life Insurance Company India Pvt. Ltd. Is a joint venture
between Aviva of UK and Dabur, one of India's leading producers of
traditional healthcare products? Aviva holds a 26 per cent stake in the
joint venture and the Dabur group holds the balance 74 per cent share.
BAJAJ ALLIANZ

Bajaj Allianz is a joint venture between Allianz AG one of the world's

largest insurance companies, and Bajaj Auto, one of the biggest 2 and
3 wheeler manufacturers in the world. Bajaj Allianz is into both life
insurance and general insurance. Allianz Group is one of the world's
leading insurers and financial services providers. Founded in 1890 in
Berlin, Allianz is now present in over 70 countries
HDFC STANDARD LIFE INSURANCE CO. LTD
Is a joint venture between HDFC Ltd., India's largest housing finance
institution and Standard Life Assurance Company, Europe's largest
mutual life company. It was the first life insurance company to be
granted a certificate of registration by the IRDA on the 23rd of
October 2000.

ING VYSYA LIFE INSURANCE COMPANY LIMITED

It is a joint venture between Vysya Bank and ING Group of Holland,
the world's 4th largest financial services group, with presence
across50 countries, and a heritage of over 150 years.
KOTAK MAHINDRA OLD MUTUAL LIFE INSURANCE LTD
Is a joint venture between Kotak Mahindra Bank Ltd. (KMBL), and
Old Mutual plc. Kotak Mahindra is one of India's leading financial
institutions and offers a range of financial services such as
commercial banking.
LIFE INSURANCE CORPORATION OF INDIA
(LIC) is an autonomous body authorized to run the life insurance
business in India with its Head Office at Mumbai. It has been
established by enact of the Parliament and started functioning from
1/9/1956.
MAX NEW YORK LIFE INSURANCE COMPANY LIMITED
It is a joint venture between Max India Limited, a multi-business
corporate, and New York Life International, a global expert in life
insurance. New York Life is a Fortune 100 company that has over 160
years of experience in the life insurance business.
METLIFE INDIA INSURANCE CO. PVT LTD
Is a joint venture between MetLife Group and its Indian partners. The
Indian partners include J&K Bank, Dhanalakshmi Bank, Karnataka

Bank, Karvy Consultants, Geojit Securities, Way2Wealth, and Mini

Muthoothu.
RELIANCE LIFE INSURANCE COMPANY
Limited is a part of Reliance Capital Ltd. of the Reliance- Anil
Dhirubhai Ambani Group. The company acquired 100 per cent
shareholding in AMPSanmar Life Insurance Company in August
2005. Taking over AMP Sanmar Life provided Reliance Life
Insurance a readymade infrastructure and a portfolio.
TATA AIG LIFE INSURANCE COMPANY
Limited is a joint venture between Tata Group and American
International Group, Inc. (AIG). Tata Group is one of the oldest and
leading business groups of India. Tata Group has had a long
association with India's insurance sector having been the largest
insurance company in India prior to the nationalization of insurance.
The Late Sir Dorab Tata was the founder Chairman of New India
Assurance Co. Ltd., a group company incorporated way back in 1919.

MARKET SHARE:

SWOT ANALYSIS for SBI Life Insurance

Strength:
1. Healthy Financials. The Company has earned a Gross Written
Premium (GWP) of `10,450crores on the back of consistent
growth in Individual business during the financial year(FY)
2012-13. During the financial year 2012-13, the Company
has added nearly 8.89 lakh new policies to its portfolio.
2. Association with State Bank Group offers platform for cross
selling insurance products to over 100 million accounts across
the country.
3. Strong market share 16.33% amongst private insurers and
4.64% overall in terms of total premium collected.
4. Despite slowdown of economy, the Company has
improved renewal premium collection and retention of clients
over years.
5. Profitable business growth demonstrated by all key distribution
channels
6. Superior Claims Settlement Process (Certified by ISO
9001:2000)

Weakness:
1. Is less aggressive in generating business compared to other
private life insurance players.
2. Over dependence on the banc-assurance channels.

3. The bureaucratic attitude is frequently held responsible for

sluggish growth

Opportunities:
1. Growing population, strengthening incomes, purchasing power,
and transforming demographics provide growth opportunities.
2. Awareness of need to invest for a secured future for self and
family.
3. Increasing universe of potential insurance takers Individuals and
Companies across industries.
4. Mobile-based insurance model: There are over 865 million
mobile users in India as of December 2012 of which around
535million are urban users while 330 million are rural users.
Extending the business capabilities to mobile devices has
quickly become a fundamental requirement for companies.

Threats
1. Introduction of new players in the market with high level of
product differentiation threatening the existing market share
of the companies.
2. Increasing number of providers offering a comprehensive range
of products at competitive prices and higher level of customer
satisfaction.
3. Decrease in the savings of the people which will lea d to lesser
income to be invested in insurance plans.

4. Ban of three years on operations by Haryana Government can

have detrimental effect in group image.
5. Regulations and standardization of business from IRDA.

PORTER FIVE FORCES MODEL

Competitive rivalry: HIGH
SBI Life Insurance experiences a high level of rivalry from existing
firms. The total market share of SBI Life Insurance in terms of total
premium collected for fiscal year 2011-12 stands at 4.64%.The major
share of market in the insurance sector is served by LIC (71.61%)
which is the only public sector enterprise in the industry.
There are mainly 13 private organizations and 1 public organization in
life insurance competition
Ministry of finance controls all the insurance companies that are in
the industry at present hence there are less chance of exit.
Power of suppliers: MODERATE
Policy designer tend to have less leverage to Bargain over premium.
Insurance is tax exempted so that suppliers bargaining power
increases. Solvency of private players is not certain.
Threat of substitute as a Risk-Coverage tool LOW

There are not many substitutes which can provide the benefits of riskcoverage to the customers at the same cost.
Threat of substitute as an Investment and saving tool HIGH
There are multiple tools available in capital market that provides
similar returns for the risk involved.
Power of buyer HIGH
There are signs of fundamental changes in consumer behaviour, a
factor which will affect all insurers.
Due to a high level of competition in the life insurance sector, the
customers enjoy a moderate to high bargaining power. Firms compete
with each other on the basis of customer service, lower premiums,
higher coverage, tax benefits which result in an overall benefit to the
customer.
Market is highly segmented
Insurance industry very return oriented and switches easily
High switching cost creates buyers lock in and makes a buyers
bargaining power
Exercise bargaining leverage over premium
Threat of new entrants: LOW
Though there are high barriers to entry in the life insurance sector;
joint-venture and partnering models are changing the competitive

landscape across the world. Insurers are teaming up with large nontraditional players or companies from other industry sectors.
Information from data provider BvD suggests that both mature and
emerging markets find joint ventures attractive: 40 percent of almost
400 joint ventures in the insurance sector since 2000 were established
in the Far East and Central Asian region, with about 30 percent in
Western Europe.
Potential Indian would seek for a brand with high brand
visibility and thus they would attribute higher reliability to it.
The acceptability of new brand is also very low.
Economies of scale are difficult to find in the initial stage of
entry in to market.
Special permission is required from the government to enter
in the insurance sector.

PEST ANALYSIS

Economical
factors

Political
factors

PEST
Socio-cultural
factors

Technological
factors

Political
a. Insurance business rural sector
b. Capital requirement:
By training the excessive staff, the company could reduce
management expense which will lead to reduction in capital
requirement and also the resources will be used to the optimum.
c. Renewal of registration
d. Investment of funds outside India
e. Power to investigation
f. Tax policy and insurance sector

 Economical
a. Adequacy of capital:
i. The company has a lot of capital since its the largest in India.
ii. The company has large balance sheet and funds.
b. Increased economic activity:
Due to increasing knowledge about insurance in India, there has been
an increase in economic activities for the company.
Also, the company has come up with various policy plans to cater to
all kinds of public.
Hence, a considerable increase has been noticed in their economic
activities.
c. Interest rates and Inflation rates.
d. Customer satisfaction:
As their tagline suggests: with us, you are sure; SBI life insurance
aims to satisfy the customer in the best possible ways by having
various policy plans and benefits. With customer satisfaction comes
customer loyalty and hence, sbi life insurance is fast growing.
e. Market Related factors

Socio-cultural factors
a. Population:

i. The company has huge presence in rural sectors and has products
catering to the rural population.
ii. The products offered are a bit differentiated on age and gender.
iii. The growing population of country has offered SBI Life Insurance
with young population which considers life insurance as an
investment.
b. Life style and Level of earning:
The policies are for all the income groups and hence it caters to all
kind of customers.

Technological
A. E-business:
Internet based life insurance helps SBI life insurance reduce cost and
time. At the same time, it can improve the quality of service. Also,
with e-business, it has been able to reach more customers.
B. maintaining the database:
With the efficient use of technology, SBI life insurance has a
systematically maintained database which makes it easier for the
company to target the customers as well get back to them later. With
the database they have, they know what new can be done to expand
their market.

CONCLUSION
To conclude we can say that there is a huge untapped market in India
which is going to benefit the sector in the upcoming years. The share
of private players is increasing. LIC is the biggest player but private
players with their strengths are increasing their market share. With
new FDI norms the sector and the players are surely to benefit.